Southwest Airlines Lowers 2026 Profit Forecast Amid Rising Fuel Costs

Southwest Airlines lowered its 2026 profit forecast to between $2.60 and $2.85 per adjusted share, a significant drop from its July estimate of $3.25 to $4.25. The company attributed the revision to increased fuel costs, making it the third major U.S. carrier to reduce its outlook this month after similar moves by Delta Air Lines and United Airlines.

Despite the lowered forecast, the airline reported third-quarter adjusted earnings of 66 cents per share on $8.42 billion in revenue, surpassing Wall Street expectations. The company is currently shifting its business model to include paid seat assignments and bag fees to increase revenue.

CEO Bob Jordan noted that demand remains strong even as fares rose to an average of $231.69 in the third quarter, a nearly 27% increase over the previous year. Jordan stated that the company's earnings power is durable despite the pressure of higher fuel costs.