Southwest flies lower
Southwest Airlines’ shares sank Wednesday after it reported a 34 percent drop in third-quarter profit on falling fares and higher costs. The company also gave a weak revenue forecast for the rest of the year.
The Dallas-based airline said that overall pricing remains “soft.” The average fare on Southwest — one of the few airlines to disclose that figure — fell 5 percent in one year to $147. As a result, passenger revenue per available seat mile dropped, as it did at American Airlines, Delta Air Lines and United Airlines.
Investors had hoped to see signs of an end to a two-year-long slide in prices caused by the carriers adding more seats than could be absorbed by demand.
Southwest shares fell 9 percent Wednesday, leading other airline stocks lower too.