Southwest Airlines cuts earnings outlook on government shutdown demand hit

Core Insights - Southwest Airlines has reduced its 2025 earnings forecast due to a demand dip caused by the federal government shutdown, which is the longest on record [1] - The revised earnings before interest and taxes for 2025 is now expected to be approximately $500 million, a decrease from the previous forecast range of $600 million to $800 million [1] - Contributing factors to the earnings revision include lower revenue during the shutdown and increased fuel prices [1] Company Performance - Following the temporary decline in demand due to the shutdown, Southwest Airlines reported that bookings have returned to previous expectations [2] - Delta Air Lines also reported a financial impact from the shutdown, estimating a loss of $200 million, but indicated that demand appears strong as they move into 2026 [2]