Southwest no longer sees profit in Q3 amid variant

Southwest Airlines said Wednesday that it no longer expects to turn a profit in the third quarter as a surge in COVID-19 infections fueled by the highly contagious delta variant darkens the outlook for travel.

The disclosure comes just three weeks after Southwest CEO Gary Kelly said the airline had passed a milestone by earning a profit in

June even excluding government pandemic relief.

The airline said Wednesday that it was profitable again in July, but it believes that the pandemic’s shadow makes it less likely that the airline can post a profit in the third quarter without federal aid for payroll costs.

Southwest is the second U.S. airline to lower expectations because of the highly contagious delta variant of COVID-19. Last week Frontier Airlines, a smaller discount carrier, blamed the virus for causing bookings to weaken more than the usual decline that occurs each year as summer winds down.

Savanthi Syth, an airline analyst for Raymond James, predicted that other airlines will lower their revenue projections but probably not until early September.

In another sign of the impact that the surge in virus cases is having on travel, United Airlines announced last week that it will require workers to be vaccinated against COVID19. Hawaiian Airlines followed with a similar announcement Monday, and Frontier will require workers who don’t get vaccinated to undergo “regular” testing for the virus.

Southwest, however, has resisted making vaccinations mandatory. American Airlines and Delta Air Lines also have stuck to their current strategy of encouraging but not requiring workers to get the shots.

United CEO Scott Kirby was scheduled to take part in an online meeting Wednesday with President Joe Biden that is designed to persuade more companies to require vaccinations for their employees.