What to look for when Southwest Airlines (LUV) reports Q3 2025 earnings results

Shares of Southwest Airlines Co. (NYSE: LUV) stayed green on Wednesday. The stock has dropped 10% over the past three months. The airline is scheduled to report its earnings results for the third quarter of 2025 on Thursday, October 23, before market open. Here’s a look at what to expect from the earnings report:

Revenue

Analysts are projecting revenue of $6.93 billion for Southwest in the third quarter of 2025, which implies a slight gain from $6.87 billion reported in the third quarter of 2024. In the second quarter of 2025, total operating revenues dipped 1.5% year-over-year to $7.2 billion.

Earnings

Analysts are forecasting a loss of $0.04 per share for LUV in Q3 2025, which compares to adjusted earnings per share of $0.15 reported in the year-ago quarter. In Q2 2025, adjusted EPS declined nearly 26% YoY to $0.43.

Points to note

Southwest can be expected to benefit from a stabilization and improvement in travel demand, which is anticipated to continue through the latter half of the year. In addition, the roll-out of various initiatives such as free checked bags, seat selection, and credit card benefits are expected to yield benefits. The company’s efforts in network expansion and flight partnerships are also expected to drive growth.

LUV expects unit revenues for Q3 2025 to range between down 2% to up 2% and capacity to be roughly flat YoY, assuming modest sequential improvement in demand. Unit revenues in Q2 were down 3.1% while capacity was up 1.6% YoY.

Last quarter, Southwest’s non-fuel unit costs were up 4.7% YoY. The airline expects non-fuel unit costs for the third quarter to increase 3.5-5.5% YoY, mainly due to inflationary pressures and other expenses. Fuel cost per gallon is expected to be $2.40-2.50.