Southwest Airlines stock drops on demand concerns
Investing.com — Shares of Southwest Airlines (NYSE:LUV) fell 3.1% as the company made cautious comments regarding demand at the Wolfe Research Global Transportation & Industrials Conference. The airline’s executive leadership expressed concerns about current revenue trends and the lack of a rebound in industry-wide demand.
Tom Doxey, Executive Vice President and Chief Financial Officer of Southwest Airlines, indicated that the first quarter unit revenues were approximately 3 percentage points below the company’s plan, and projections for the second quarter are about 6 points lower. He emphasized that there has not yet been an industry-wide inflection back in demand. Furthermore, Doxey reiterated the company’s expectations of incremental EBIT contributions of $1.8 billion in the current fiscal year and over $4 billion in the next year.
The cautious stance on demand has raised concerns among investors, contributing to the decline in Southwest Airlines’ stock price.
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