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Southwest rises above fuel prices, puts up strong 2Q profit

🕐 1 min read

DALLAS (AP) — Southwest Airlines overcame rising fuel prices to top second-quarter profit expectations, though an inflight disaster in which a passenger was killed had an adverse effect on revenue.

Flight 1380 was traveling from New York to Dallas in April when it experienced engine failure. A fan blade snapped off the engine and struck a window, leading to the death of an executive from New Mexico.

Southwest CEO and Chairman Gary Kelly said Thursday that the incident led to a $100 million drop in passenger revenue during the quarter, but he said there has been strong demand for flights on the airline. Kelly anticipates the revenue impact will be temporary and subside in the third quarter.

For the three months ended June 30, Southwest Airlines Co. earned $733 million, or $1.27 per share. The Dallas-based company earned $743 million, or $1.23 per share, a year earlier.

Stripping out certain items, earnings were $1.26 per share. That’s a penny better than what analysts polled by Zacks Investment Research predicted.

Operating revenue edged up to $5.74 billion from $5.73 billion, but fell just short of analysts’ estimates.

The company’s shares slipped less than 1 percent before the market opened.

Portions of this story were generated by Automated Insights (http://automatedinsights.com/ap) using data from Zacks Investment Research. Access a Zacks stock report on LUV at https://www.zacks.com/ap/LUV

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