Southwest Airlines (NYSE:LUV) Issues Q2 2026 Earnings Guidance

Key Points

• Q2 2026 EPS guidance of $0.35–$0.65 was issued, with the midpoint below the Street consensus of $0.60 and management citing higher fuel costs; the stock fell about $1.49 to $39.43 on the update.
• Southwest also missed Q1 expectations, reporting $0.45 EPS vs. $1.19 expected and $7.25B revenue vs. $8.46B consensus, which pressures near‑term earnings visibility despite improving margins and $227M net income.
• The company paid a $0.18 quarterly dividend (1.8% yield) and analyst sentiment is mixed, with a consensus rating of "Hold" and a $44.22 target after several price‑target cuts.

Southwest Airlines (NYSE:LUV - Get Free Report) issued an update on its second quarter 2026 earnings guidance on Wednesday morning. The company provided EPS guidance of 0.350-0.650 for the period, compared to the consensus EPS estimate of 0.600. The company issued revenue guidance of -.

Southwest Airlines Price Performance

Shares of Southwest Airlines stock traded down $1.49 on Wednesday, reaching $39.43. 9,260,176 shares of the stock were exchanged, compared to its average volume of 9,621,628. The firm's 50 day moving average is $43.46 and its 200-day moving average is $40.16. Southwest Airlines has a one year low of $24.63 and a one year high of $55.11. The company has a debt-to-equity ratio of 0.57, a quick ratio of 0.45 and a current ratio of 0.52. The firm has a market cap of $19.36 billion, a PE ratio of 46.94, a P/E/G ratio of 0.47 and a beta of 1.19.

Southwest Airlines (NYSE:LUV - Get Free Report) last issued its quarterly earnings data on Wednesday, April 22nd. The airline reported $0.45 EPS for the quarter, missing the consensus estimate of $1.19 by ($0.74). The company had revenue of $7.25 billion during the quarter, compared to the consensus estimate of $8.46 billion. Southwest Airlines had a net margin of 1.57% and a return on equity of 6.18%. Southwest Airlines has set its Q2 2026 guidance at 0.350-0.650 EPS. As a group, analysts anticipate that Southwest Airlines will post 2.72 EPS for the current fiscal year.

Southwest Airlines Announces Dividend

The firm also recently declared a quarterly dividend, which was paid on Thursday, April 2nd. Shareholders of record on Thursday, March 12th were given a $0.18 dividend. This represents a $0.72 annualized dividend and a yield of 1.8%. The ex-dividend date was Thursday, March 12th. Southwest Airlines's dividend payout ratio is 85.71%.

Analyst Ratings Changes

Several equities research analysts have recently weighed in on LUV shares. Weiss Ratings reiterated a "hold (c)" rating on shares of Southwest Airlines in a research report on Friday, March 27th. Citigroup decreased their price objective on shares of Southwest Airlines from $54.00 to $44.00 and set a "neutral" rating for the company in a research report on Friday, March 20th. Susquehanna reduced their price target on shares of Southwest Airlines from $55.00 to $42.00 and set a "neutral" rating for the company in a report on Thursday, April 2nd. JPMorgan Chase & Co. reduced their price target on shares of Southwest Airlines from $58.00 to $56.00 in a report on Friday, March 27th. Finally, BMO Capital Markets reduced their price target on shares of Southwest Airlines from $57.50 to $45.00 and set an "outperform" rating for the company in a report on Tuesday, March 31st. Eight equities research analysts have rated the stock with a Buy rating, eight have assigned a Hold rating and four have issued a Sell rating to the company's stock. According to data from MarketBeat.com, the stock currently has a consensus rating of "Hold" and a consensus target price of $44.22.

More Southwest Airlines News

Here are the key news stories impacting Southwest Airlines this week:

• Positive Sentiment: Transformation is showing early benefits — Southwest reported improved margins, $227M net income, $0.45 EPS in line with company guidance, 4.6% operating margin (up ~8.1 pts YoY), $1.4B operating cash flow and record first‑quarter passenger and revenue metrics, supporting the company's turnaround narrative. SOUTHWEST AIRLINES REPORTS FIRST QUARTER RESULTS
• Positive Sentiment: Product and digital initiatives could support revenue per passenger over time — new Chief Digital & Marketing Officer appointment and programs (e.g., Sip and Ship, route expansion) aim to monetize the network and customer base. Southwest Ties New Digital Leadership And Perks To Lofty LUV Valuation
• Neutral Sentiment: Sell‑side positioning remains mixed — BNP Paribas Exane raised its price target (to $33) but kept an Underperform rating, and analysts' consensus is a Hold; this signals differing views on outlook versus valuation. BNP Paribas adjusts PT on Southwest Airlines
• Negative Sentiment: Big quarter and revenue miss — Southwest reported $0.45 EPS vs. the $1.19 consensus and revenue of $7.25B vs. $8.46B consensus, directly pressuring sentiment; shortfall reduces near‑term earnings visibility. View Press Release
• Negative Sentiment: Q2 guidance below consensus and fuel headwinds — Southwest set Q2 EPS guidance of $0.35–$0.65 (midpoint < consensus) and cited higher fuel costs; management has offset some pressure via new fees and seat assignment charges, but fuel remains a key downside risk. Southwest forecasts quarterly earnings below estimates on higher fuel
• Negative Sentiment: Analyst caution and media scrutiny — commentary (e.g., Barron's) flags that this earnings print is a test of Southwest's resilience after prior outperformance, which can amplify short‑term selling. Southwest Airlines Stock Has Defied the Turbulence

Institutional Trading of Southwest Airlines

Hedge funds and other institutional investors have recently modified their holdings of the business. Los Angeles Capital Management LLC bought a new stake in shares of Southwest Airlines in the fourth quarter valued at approximately $26,000. DV Equities LLC bought a new stake in shares of Southwest Airlines in the fourth quarter valued at approximately $30,000. Quarry LP bought a new stake in shares of Southwest Airlines in the fourth quarter valued at approximately $35,000. IFC & Insurance Marketing Inc. bought a new stake in shares of Southwest Airlines in the fourth quarter valued at approximately $47,000. Finally, Strive Financial Group LLC bought a new stake in shares of Southwest Airlines in the fourth quarter valued at approximately $50,000. Institutional investors own 80.82% of the company's stock.

Southwest Airlines Company Profile

Southwest Airlines Co is a U.S.-based low-cost carrier that operates a point-to-point domestic and near-international airline network. Headquartered in Dallas, Texas, the company primarily flies Boeing 737 aircraft and offers no-frills, single-class service designed to keep fares competitive. Southwest's operating model emphasizes high aircraft utilization, quick turnaround times and an open seating policy, allowing customers to board and select seats on a first-come, first-served basis.

Founded in 1967 by Herb Kelleher and Rollin King as Air Southwest Company, Southwest began commercial service in 1971, initially connecting Dallas, Houston and San Antonio.

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