Extra legroom, assigned seats, overnight flights: Inside Southwest Airlines' plan for its future
DALLAS — Southwest Airlines executives on Thursday outlined for Wall Street their vision to boost profits: extra legroom seats starting in 2026, assigned seating, international partnerships and overnight flights.
DALLAS — Southwest Airlines executives on Thursday outlined for Wall Street their vision to boost profits: extra legroom seats starting in 2026, assigned seating, international partnerships and overnight flights. Southwest’s new plan comes as its leaders seeks to fend off activist Elliott Investment Management, which has called for leadership changes.
Southwest said its three-year plan will add $4 billion to earnings before interest and taxes in 2027.
Southwest shares were up nearly 10% in early afternoon trading after it raised its third-quarter revenue forecast and said its board authorized $2.5 billion in share buybacks.
The airline said it expects unit revenue to rise as much as 3% in the third quarter over the same period last year, up from a previous forecast of a decline of as much as 2%, helped in part by rebooking passengers who were originally flying on airlines affected by July’s CrowdStrike outage.
Like with many changes in the airline industry, those new initiatives won’t happen overnight. Seats with extra legroom won’t debut until 2026, as the carrier requires Federal Aviation Administration approval and time to retrofit aircraft, according to a slide from Thursday investor’s presentation. It estimated that the new cabins, in which about a third of the seats will have additional legroom, will generate $1.7 billion in earnings before interest and taxes in 2027.
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