Southwest Airlines Shares Gain 3.7%

WASHINGTON (dpa-AFX) - Southwest Airlines Inc. (LUV) on Friday lowered its full-year 2025 earnings before interest and taxes (EBIT), before special items, citing weaker revenue during the U.S. government shutdown and higher fuel costs.

The carrier now expects EBIT of about $500 million for the year, down from its previous forecast of $600 million to $800 million.

Southwest said demand temporarily declined during the shutdown period but noted that bookings have since returned to prior expectations.

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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