Southwest Airlines Raises Q3 Revenue Forecast

Southwest Airlines has raised its third-quarter revenue forecast, expecting unit revenue growth up to 3%, a significant improvement from prior estimates of a 2% decline, largely attributed to increased bookings post-CrowdStrike outage. The airline announced a $2.5 billion share buyback program and is implementing changes to enhance profitability, including introducing premium seating and retrofitting cabins, projected to yield $1.5 billion. Amid pressure from activist investor Elliott Investment Management, Southwest is also adding Bob Fornaro to its board to bolster industry expertise. The airline plans to present its turnaround strategy during an investor day, amidst calls from Elliott for leadership changes. Additionally, Southwest will be cutting service in Atlanta, affecting hundreds of flight crew positions, as part of its operational adjustments. These moves come as part of a broader goal to generate an additional $4 billion in earnings before interest and taxes by 2027.