What to look for when Southwest Airlines (LUV) reports Q1 2025 earnings results | AlphaStreet

Shares of Southwest Airlines Co. (NYSE: LUV) had been up over 2% on Tuesday. The inventory has dropped 21% over the previous three months. The airline is scheduled to report its earnings results for the primary quarter of 2025 on Thursday, April 24, earlier than market open. Right here’s a look at what to count on from the earnings report:

Income

Analysts are projecting revenues of $6.4 billion for Southwest in Q1 2025, which signifies a development of 1% from the identical interval a 12 months in the past. Within the fourth quarter of 2024, working income rose almost 2% year-over-year to $6.9 billion.

Earnings

Analysts are forecasting a lack of $0.19 per share for Q1 2025, which compares to an adjusted lack of $0.36 per share reported in Q1 2024. In This autumn 2024, adjusted earnings per share rose 47% YoY to $0.56.

Factors to observe

The airline business has been seeing weak point in bookings and journey demand due to a tough macro atmosphere. Southwest is amongst these experiencing this strain. These challenges, together with a higher-than-expected completion issue, much less authorities journey, and a greater-than-estimated impression from the California wildfires, led the corporate to revise its steering for the primary quarter of 2025 in an investor replace final month.

Southwest now expects unit revenues for Q1 2025 to be up 2-4% YoY and capability to be down approx. 2% YoY. The earlier expectations had been for unit revenues to enhance 5-7% and capability to be down 2-3% YoY.

The airline now expects CASM-X for Q1 2025 to enhance approx. 6% YoY versus the prior estimate of up 7-9%, primarily due to elevated capability and lower-than-expected wage, wages and advantages, upkeep, and different bills. CASM-X stands for working bills per accessible seat mile, excluding gasoline and oil expense, particular gadgets, and revenue sharing. Gas price per gallon is now anticipated to vary between $2.35-2.45 versus the prior expectation of $2.50-2.60.