Dj Southwest Cuts Outlook Over Government Shutdown, Higher Fuel Costs

By Dean Seal

Southwest Airlines cut its profit guidance for the year, citing rising fuel costs and lost revenue from this fall's U.S. government shutdown.

The carrier said Friday that demand temporarily sputtered during the 43-day shutdown, which included 10 days of government-ordered flight restrictions at 40 major airports. Southwest now expects earnings before interest and taxes to come in at $500 million for 2025, down from a prior projection for $600 million to $800 million.

Bookings have since bounced back to the company's previous expectations, Southwest said.

Shares ticked down about 1% to $35.53 in premarket trading.

The Federal Aviation Administration ordered a reduction in air traffic early last month in response to staffing shortages among federal transportation workers, who went weeks without pay while the government shut down.

Delta Air Lines disclosed Wednesday that its bookings fell 5% to 10% during the 10 days that flights were restricted. The airline said the shutdown dented its fourth-quarter profit by about $200 million, or 25 cents a share.

Alaska Air Group, which owns Alaska Airlines and Hawaiian Airlines, forecasts that the shutdown's disruption and related revenue losses will eat into its fourth-quarter adjusted earnings by 15 cents a share.

Write to Dean Seal at dean.seal@wsj.com