Southwest Airlines (NYSE:LUV) Posts Earnings Results, Beats Expectations By $0.09 EPS

Southwest Airlines (NYSE:LUV) released its quarterly earnings data on Wednesday. The airline reported $0.66 earnings per share for the quarter, beating analysts’ consensus estimates of $0.57 by $0.09, FiscalAI reports. Southwest Airlines had a return on equity of 14.15% and a net margin of 2.78%. The firm had revenue of $8.42 billion during the quarter, compared to analyst estimates of $8.25 billion.

Southwest Airlines Stock Up 0.5%

Shares of LUV traded up $0.20 during mid-day trading on Wednesday, reaching $39.85. The company had a trading volume of 9,045,662 shares, compared to its average volume of 7,419,942. The company has a debt-to-equity ratio of 0.54, a quick ratio of 0.42 and a current ratio of 0.49. The company has a market capitalization of $19.50 billion, a price-to-earnings ratio of 24.45, a price-to-earnings-growth ratio of 1.00 and a beta of 1.16. The firm has a 50-day moving average price of $40.78 and a 200 day moving average price of $42.85. Southwest Airlines has a 52 week low of $29.26 and a 52 week high of $55.11.

Southwest Airlines Announces Dividend

The business also recently declared a quarterly dividend, which was paid on Thursday, September 24th. Stockholders of record on Thursday, September 3rd were given a $0.18 dividend. This represents a $0.72 dividend on an annualized basis and a dividend yield of 1.8%. The ex-dividend date of this dividend was Thursday, September 3rd. Southwest Airlines’s payout ratio is currently 44.17%.

Analyst Ratings Changes

LUV has been the subject of several recent analyst reports. BMO Capital Markets lowered their price objective on shares of Southwest Airlines from $60.00 to $50.00 and set an “outperform” rating for the company in a research note on Monday, September 28th. Weiss Ratings upgraded Southwest Airlines from a “hold (c)” rating to a “hold (c+)” rating in a report on Tuesday, August 18th. Susquehanna cut their price target on shares of Southwest Airlines from $50.00 to $45.00 and set a “neutral” rating on the stock in a report on Wednesday, October 7th. JPMorgan Chase & Co. cut their price target on shares of Southwest Airlines from $60.00 to $59.00 and set an “overweight” rating on the stock in a report on Friday, July 24th. Finally, Wall Street Zen downgraded shares of Southwest Airlines from a “buy” rating to a “hold” rating in a research report on Saturday, September 5th. Nine equities research analysts have rated the stock with a Buy rating, nine have issued a Hold rating and four have issued a Sell rating to the stock. According to MarketBeat, the stock presently has an average rating of “Hold” and an average price target of $47.41.

Southwest Airlines News Roundup

Here are the key news stories impacting Southwest Airlines this week:

• Positive Sentiment: Quarterly results exceeded expectations: Southwest reported $8.42 billion in third-quarter revenue, above the $8.25 billion consensus estimate, while reported EPS of $0.66 topped expectations of $0.57. Southwest Airlines earnings press release
• Positive Sentiment: Demand and revenue remained strong: Record third-quarter operating revenue increased 21.2% year over year, driven by a 22.8% rise in passenger revenue. Operating margin improved to 4.5% from 0.5% a year earlier, and Southwest ended the quarter with $5.6 billion of liquidity. Southwest reports record third-quarter revenue
• Neutral Sentiment: Near-term guidance remains profitable but cautious: Southwest forecast fourth-quarter adjusted EPS of $0.55 to $0.80, giving investors a range for performance as the airline manages rising operating costs.
• Negative Sentiment: Southwest cut its 2026 profit forecast: The airline became the third major U.S. carrier this month to lower its outlook, citing a spike in fuel prices. Brent crude recently exceeded $110 per barrel, creating a significant earnings headwind. Southwest cuts 2026 profit forecast on higher fuel
• Negative Sentiment: Fuel inflation is offsetting operational gains: Third-quarter fuel expense increased by $821 million year over year, while total operating expenses rose 16.3% to $8.04 billion. The higher cost base is limiting the benefit of strong passenger demand and revenue growth. Reuters report on Southwest profit forecast
• Negative Sentiment: Investors remain concerned about pricing pressure: Reports that Southwest may introduce additional customer charges for bags, seats or boarding could support ancillary revenue, but may also risk weakening the airline’s value-focused brand and customer appeal. Southwest CEO message on additional fees

Southwest Airlines Company Profile

Southwest Airlines Co is a major U.S. passenger airline headquartered in Dallas, Texas. The company provides scheduled air transportation for leisure and business travelers, with service connecting cities throughout the United States and selected destinations in Mexico, the Caribbean, and Central America.

Southwest is known for its predominantly domestic network and point-to-point operating model. In addition to passenger flights, the company offers ancillary services and air cargo transportation.