Southwest Airlines(US:LUV) ZACKS·2026-01-21 16:01Core Viewpoint - Southwest Airlines is anticipated to report a year-over-year decline in earnings despite an increase in revenues for the quarter ended December 2025, with actual results being a significant factor influencing its near-term stock price [1][2]. Earnings Expectations - The upcoming earnings report is scheduled for January 28, and if the results exceed expectations, the stock may rise; conversely, a miss could lead to a decline [2]. - The consensus estimate for quarterly earnings is $0.55 per share, reflecting a year-over-year decrease of 1.8%, while revenues are projected to be $7.49 billion, an increase of 8% from the previous year [3]. Estimate Revisions - Over the last 30 days, the consensus EPS estimate has been revised 14.06% higher, indicating a positive reassessment by analysts [4]. - The Most Accurate Estimate for Southwest is higher than the Zacks Consensus Estimate, resulting in an Earnings ESP of +7.27%, suggesting a bullish outlook on the company's earnings prospects [12]. Earnings Surprise History - In the last reported quarter, Southwest was expected to post earnings of $0.01 per share but actually reported $0.11, resulting in a surprise of +1,000.00% [13]. - Over the past four quarters, the company has beaten consensus EPS estimates three times [14]. Industry Context - In the broader airline industry, American Airlines is expected to report earnings of $0.38 per share for the same quarter, indicating a year-over-year decline of 55.8%, with revenues projected at $14.07 billion, up 3% [18]. - The consensus EPS estimate for American Airlines has been revised down by 29.4% over the last 30 days, resulting in an Earnings ESP of -1.21%, making it challenging to predict a beat on the consensus EPS estimate [19].