Southwest Cuts Financial Outlook, Blames Revenue Management 'Complexities'


A Southwest Airlines Boeing 737-800

Skift Take

Southwest's cut in revenue guidance for the current quarter comes just three weeks after a vocal activist investor called for big changes at the airline.

Southwest Airlines has cut its revenue guidance for the current quarter. On Wednesday morning, the low-cost carrier said it now expects operating revenue per available seat mile (RASM) to be down 4% to 4.5% for the quarter. Its prior guidance forecast a drop of 1.5% to 3.5%.

The company cited difficulties in keeping pace with changing consumer preferences and travel patterns as a key reason for the reduction.

RASM is calculated by dividing an airline's total operating revenues by its available seat miles. It is an important industry indicator for the financial and operational