Southwest Airlines Revenue & Financials

Southwest Airlines generated approximately 26.1 billion dollars in total operating revenue in fiscal year 2024, essentially flat with the 26.1 billion dollars reported in fiscal year 2023, reflecting an operating environment in which the airline faced both capacity constraints from Boeing delivery delays and intensifying price competition in key domestic markets. The airline reported a net income attributable to common shareholders of approximately 465 million dollars in fiscal 2024, down sharply from the 1.2 billion dollars earned in fiscal 2023, as rising costs — particularly labor costs following the 2023 pilot contract ratification — outpaced revenue growth. The operating margin contracted to approximately 3 to 4 percent, well below the 10 to 12 percent margins that Delta Air Lines achieved in the same period, and this gap is precisely what Elliott Advisors and other institutional investors have focused on in their critique of Southwest's management. Cost per Available Seat Mile excluding fuel (CASM-ex) deteriorated in 2024 to approximately 11.6 to 11.8 cents, compared with roughly 10.5 cents two years earlier, reflecting not only the pilot contract economics but also increased technology investment, higher airport costs, and the costs associated with operational remediation following the December 2022 meltdown. Fuel costs, which represent approximately 22 to 25 percent of Southwest's total operating expenses, remained volatile in 2024, with the airline's average fuel cost per gallon tracking the broader crude oil market. Southwest has historically used fuel hedging to manage this volatility, though its hedging program has been scaled back. Total liquidity as of late 2024 stood at approximately 8 billion dollars, providing meaningful financial flexibility. The airline's long-term debt was approximately 7 billion dollars, reflecting the pandemic-era borrowing that remains on the balance sheet.