Full-year 2026 adjusted EPS guided at least $4, up from $0.93 in 2025.
Southwest reported strong Q4 2025 results (record revenue, EBIT above guidance) and guided FY2026 adjusted EPS of at least $4.00, a massive step up from $0.93. Management highlighted the successful rollout of assigned seating and extra legroom, with further upside expected as booking behavior normalizes. Boeing was confirmed as a reliable supplier with 66 737-8 deliveries planned. FY2025 EPS of $0.93; Q4 revenue record $7.4B.
Buzzberg readFull-year 2026 adjusted EPS guided at least $4, up from $0.93 in 2025.Southwest reported strong Q4 2025 results (record revenue, EBIT above guidance) and guided FY2026 adjusted EPS of at least $4.00, a massive step up from $0.93. Management highlighted the successful rollout of assigned seating and extra legroom, with further upside expected as booking behavior normalizes. Boeing was confirmed as a reliable supplier with 66 737-8 deliveries planned. FY2025 EPS of $0.93; Q4 revenue record $7.4B.Read full analysisCollapse analysis
Southwest reported strong Q4 2025 results (record revenue, EBIT above guidance) and guided FY2026 adjusted EPS of at least $4.00, a massive step up from $0.93. Management highlighted the successful rollout of assigned seating and extra legroom, with further upside expected as booking behavior normalizes. Boeing was confirmed as a reliable supplier with 66 737-8 deliveries planned. FY2025 EPS of $0.93; Q4 revenue record $7.4B.
FY2026 EPS guided 'at least $4.00' (floor), with Q1 2026 at least $0.45.
Q1 2026 RASM expected up at least 9.5% YoY; capacity up 1-2%.
CASM-X up ~3.5% in Q1, including 1.1pts from seat removal.
Revenue$7.442B
+7% QoQ
EPS$0.58
reported
Gross margin20.3%
reported
Op margin5.25%
reported
What changed this quarter
01
Guidance
Full-year 2026 adjusted EPS guided at least $4, up from $0.93 in 2025.
Guidance · revenue to 9.5%
02
Revenue
Q1 2026 RASM expected up at least 9.5% year-over-year.
FY2025 EPS of $0.93; Q4 revenue record $7.4B.
03
Product
Assigned seating and extra legroom launch exceeded expectations.
FY2026 EPS guided 'at least $4.00' (floor), with Q1 2026 at least $0.45.
04
Demand
Corporate business up mid-single digits, strong January bookings.
Management expressed strong confidence in 2026 guidance and momentum, citing record revenues, operational improvements, and successful implementation of major initiatives.
Demand & capex
Demand
Bookings & conversion
Corporate business up mid-single digits, strong January bookings.. Management expressed strong confidence in 2026 guidance and momentum, citing record revenues, operational improvements, and successful implementation of major initiatives.
Capex
Investment and capacity
Southwest guided full year 2026 net capital spending to $3 billion to $3.5 billion, down from prior levels, reflecting aircraft deliveries and retirements while maintaining investment-grade rating.
Tone · Upbeat
Management expressed strong confidence in 2026 guidance and momentum, citing record revenues, operational improvements, and successful implementation of major initiatives.
Supply-chain alpha
A1
Southwest expects 66 Boeing 737-8 deliveries in 2026 and will retire 60 aircraft, implying net fleet growth of 6 units despite a flat fleet count in 2025.
Removing six seats per 737-700 for extra legroom seating will add 1.1 points to CASM-X growth in Q1 2026, a direct cost impact from the product transformation.
Southwest expects 66 Boeing 737-8 deliveries in 2026 and will retire 60 aircraft, implying net fleet growth of 6 units despite a flat fleet count in 2025. — Positive signal for Boeing's production ramp; Southwest is a major 737 customer and these deliveries support the MAX program's cash flow.
“Boeing continues to execute on its delivery commitments. We expect 66 Boeing 737-8 deliveries in 2026 and anticipate retiring 60 aircraft during the year.”
… quarter of 2025. We expect continued strong cost discipline with CASMX projected to increase approximately 3.5% year-over-year, which includes approximately 1.1 points of impact from the removal of six seats from our 737-700 fleet to enable extra legroom seating. We plan to keep management headcount expense flat to 2025 levels in 2026, and we'll also be focused on operational efficiency within our frontline teams. Turning to fleet, Boeing continues to execute on its delivery commitments. We expect 66 Boeing 737-8 deliveries in 2026 and anticipate retiring 60 aircraft during the year. Full year net capital spending is expected to be in the range of $3 billion to $3.5 billion. In November, we issued $1.5 billion unsecured bonds at industry-leading terms. We ended the quarter with $3.2 billion in cash and a gross leverage ratio of 2.4 times, both within our targets. During 2025, we repurchased $2.6 billion of shares, and distributed $399 million in dividends. At the same time, we plan to make the necessary investments in our business while staying within the guardrails that support our investment grade rating. In closing, 2026 is positioned to be a year of significant margin …
Removing six seats per 737-700 for extra legroom seating will add 1.1 points to CASM-X growth in Q1 2026, a direct cost impact from the product transformation.
… year 2026, we are providing an adjusted EPS guide of at least $4, which represents the lower end of our forecast. For the first quarter of 2026, we are guiding an adjusted EPS of at least 45 cents per share which also represents the lower end of our forecast and compares to a loss of 13 cents in the first quarter of 2025. We expect continued strong cost discipline with CASMX projected to increase approximately 3.5% year-over-year, which includes approximately 1.1 points of impact from the removal of six seats from our 737-700 fleet to enable extra legroom seating. We plan to keep management headcount expense flat to 2025 levels in 2026, and we'll also be focused on operational efficiency within our frontline teams. Turning to fleet, Boeing continues to execute on its delivery commitments. We expect 66 Boeing 737-8 deliveries in 2026 and anticipate retiring 60 aircraft during the year. Full year net capital spending is expected to be in the range of $3 billion to $3.5 billion. In November, we issued $1.5 billion unsecured bonds at industry-leading terms. We ended the quarter with $3.2 billion in cash and a gross leverage ratio of 2.4 times, both within our targets. During 2025, …
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