Southwest cuts 2026 profit forecast due to higher fuel costs — CNBC

In the United States, Southwest Airlines has lowered its adjusted profit forecast for 2026 due to higher fuel costs. As CNBC reports, the carrier expects adjusted earnings of between $2.60 and $2.85 per share, compared with its July forecast of between $3.25 and $4.25 per share.

The third major U.S. airline

Southwest became the third major U.S. airline to revise its 2026 profit forecast downward during October due to higher fuel prices.

At the same time, the company exceeded Wall Street expectations in the third quarter. Adjusted earnings per share amounted to 66 cents, compared with an LSEG consensus forecast of 58 cents. Adjusted revenue reached $8.42 billion, while analysts had expected $8.25 billion.

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Business model change

Chief Executive Officer Bob Jordan said demand remained strong despite comparisons with the same period last year, when baggage fees and other commercial initiatives were already in effect. According to him, this strengthens the company’s confidence in the resilience of its ability to generate profit even with significantly higher fuel costs.

In recent years, Southwest has been changing its traditional business model in an effort to increase revenue. The company is abandoning practices that differentiated it from competitors, including its policy of two free checked bags per passenger and open seating. Instead, the carrier has begun charging for many seat-selection options and introduced a baggage fee.