Southwest Airlines Earnings Cheat Sheet: Revenue Grows Again by Double-Digits

S&P 500 (NYSE:SPY) component Southwest Airlines Co. (NYSE:LUV) reported higher profit for the second quarter as revenue showed growth. Southwest Airlines Co. is a passenger airline that provides air transportation in the United States.

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Southwest Airlines Earnings Cheat Sheet for the Second Quarter

Results: Net income for Southwest Airlines Co. rose to $161 million (21 cents per share) vs. $112 million (15 cents per share) in the same quarter a year earlier. This marks a rise of 43.8% from the year earlier quarter.

Revenue: Rose 30.6% to $4.14 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: LUV reported adjusted net income of 15 cents per share. By that measure, the company fell short of mean estimate of 21 cents per share. Analysts were expecting revenue of $4.17 billion.

Quoting Management: Gary C. Kelly, Chairman of the Board, President, and Chief Executive Officer, stated, “With energy prices surging, and Brent crude oil near $120 a barrel, significant revenue growth was critical to achieve second quarter 2011 operating income of $276 million and net income of $121 million (both excluding special items). Record load factors and record passenger yields resulted in a record $3.9 billion in passenger revenues. Still, with our economic fuel costs rising 72 percent, our year-over-year revenue growth could not keep pace. However, total operating revenues of $4.1 billion, another record, is a notable accomplishment. Southwest Airlines celebrated a momentous milestone this quarter with the closing of our AirTran acquisition, and it couldn’t have come at a more critical time with volatile fuel prices and economic uncertainty. We have the opportunity to optimize AirTran’s flight schedule to boost its profitability. Ultimately, integrating their network into Southwest’s provides even more substantial opportunities to boost combined revenues and profits.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 20.8%, with the biggest boost coming in the most recent quarter when revenue rose 30.6% from the year earlier quarter.

The company fell short of estimates last quarter after being in line with expecations the quarter before with net income of 3 cents.

Competitors to Watch: AirTran Holdings, Inc. (NYSE:AAI), JetBlue Airways Corp. (NASDAQ:JBLU), Delta Air Lines, Inc. (NYSE:DAL), AMR Corporation (NYSE:AMR), US Airways Group, Inc. (NYSE:LCC), Allegiant Travel Company (NASDAQ:ALGT), Republic Airways Hldgs. Inc. (NASDAQ:RJET), SkyWest, Inc. (NASDAQ:SKYW), Alaska Air Group, Inc. (NYSE:ALK), and United Continental Hldgs., Inc. (NYSE:UAL).

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(Source: Xignite Financials)

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