Southwest posted a second-quarter earnings loss on Thursday, but the air carrier said it expects air travel demand to remain depressed until a vaccine or treatment for the coronavirus becomes available.
Southwest Airlines posted a net loss of $915 million, or $1.63 per share, compared with net income of $741 million, or $1.37 per share a year ago. The adjusted loss came to $2.67 per share, compared with FactSet's consensus estimate for a loss of $2.73 per share.
Revenue tumbled 82.9% from a year ago to $1.01 billion, beating FactSet's estimate for $947.9 million.
Passenger revenue declined 87.2% to $704 million, beatings expectations of $577 million.
Load factor, which measures the percentage of available seating capacity that is filled with passengers, slid to 31.4% from 86.4%, ahead of expectations of 20.5%.
"We were encouraged by improvements in May and June leisure passenger traffic trends, compared with March and April; however, the improving trends in revenue and bookings have recently stalled in July with the rise in COVID-19 cases," Gary Kelly, chairman and CEO, said in a statement. "We expect air travel demand to remain depressed until a vaccine or therapeutics are available to combat the infection and spread of COVID-19."
Kelly, in an interview with Jim Cramer on CNBC, urged the importance of mask-wearing.
When asked whether or not, with Southwest's safety protocols, he thinks that Southwest is safe for those who choose to fly.
However, Southwest is still an airline.
"They're real bad," noted Cramer.
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