Story perspectives

Southwest, American Slash 2026 Profit Forecasts Amid Fuel Surge

7/24/2026

Summary

Story summary

Southwest Airlines and American Airlines cut their 2026 profit forecasts after jet-fuel prices spiked.
Southwest now expects full-year adjusted earnings of $3.25-$4.25 per share, forecasts Q3 earnings of $0.50-$0.75 per share, trims capacity growth to about 1 %, and removes six seats per Boeing 737-700 for extra-legroom rows, raising non-fuel unit-cost growth by 1.1 percentage points.
Both carriers anticipate average jet-fuel costs of about $3.75 per gallon in the third quarter.

History

Historical Context

In October 1973 OAPEC embargoed the United States and other Israel supporters, prompting OPEC to raise the posted barrel price from about $5 to $11.65. The shock, amplified by Saudi Arabia’s 25 % share of world reserves, persisted until March 1974 and reshaped airline economics, echoing today’s jet-fuel global surge.

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Story summary

Southwest Airlines and American Airlines cut their 2026 profit forecasts after jet-fuel prices spiked.
Southwest now expects full-year adjusted earnings of $3.25-$4.25 per share, forecasts Q3 earnings of $0.50-$0.75 per share, trims capacity growth to about 1 %, and removes six seats per Boeing 737-700 for extra-legroom rows, raising non-fuel unit-cost growth by 1.1 percentage points.
Both carriers anticipate average jet-fuel costs of about $3.75 per gallon in the third quarter.

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