Southwest Airlines Co.LUV
NYSE•Industrials•Airlines
Southwest Airlines Co. operates as a passenger airline company that provides scheduled air transportation services in the United States and internationally. It also provides Rapid Rewards loyalty program; SWABIZ, an online booking tool; and inflight entertainment platform that includes movies-on-demand live and on-demand television, flight tracker, and additional curated content, as well as a variety of premium snacks and coffee. In addition, the company offers ancillary services, such as in-flight purchases, baggage fees, EarlyBird Check-In, and upgraded boarding, as well as transportation of pets and unaccompanied minors. As of December 31, 2025, the company operated a total fleet of 803 Boeing 737 aircraft; and served 117 destinations in 42 states, the District of Columbia, and the Commonwealth of Puerto Rico, as well as ten near-international countries, including Mexico, Jamaica, the Bahamas, Aruba, the Dominican Republic, Costa Rica, Belize, Cuba, the Cayman Islands, and Turks and Caicos. Southwest Airlines Co. was incorporated in 1967 and is headquartered in Dallas, Texas.
Southwest Airlines Company (LUV) reported trailing twelve months revenue of $28.88B as of March 2026, a 4.7% increase year-over-year. Quarterly revenue reached $7.25B, reflecting continued top-line momentum.
Southwest Airlines Company generated $817.00M in TTM net income, with quarterly EBITDA of $728.00M. The operating margin expanded from -3.5% to 4.6%, suggesting improving cost efficiency and pricing discipline.
The spread between operating margin (4.6%) and net margin (3.1%) indicates tight cost control with minimal non-operating drag. Net margin has improved from -2.3% a year ago, signaling stronger bottom-line efficiency.
LUV trades at a P/E of 22.3x (in line with broad market averages) and a P/S of 0.6x. The price-to-book ratio of 2.7x reflects a moderate premium to book value.
The company generated $788.00M in free cash flow over the trailing twelve months, a 119.5% increase year-over-year, indicating strong cash generation ability. The balance sheet shows $29.36B in total assets with $4.54B in long-term debt against $6.88B in stockholders equity for a debt-to-equity ratio of 0.7. Data based on the most recent quarterly reports.
Competitive analysis based on 21 quarters of fundamental data
Operating margins are under pressure, averaging 2.5%. The business may lack pricing power or face rising costs.'
ROE is low or negative, suggesting limited competitive advantage or capital allocation challenges.
Only 3 of the last 8 quarters had positive FCF — the business may require external capital to sustain operations.
TTM revenue has grown consistently (6 of 7 quarters up), with ~6.9% growth over the period. Strong demand durability.
Data-driven red flags and warnings across 21 quarters
The company posted negative operating margins in recent quarters — core operations are unprofitable.
Free cash flow has been negative in 5 of the last 8 quarters — earnings are not translating to cash.
Debt-to-equity has risen 51.2% recently — increasing financial risk even if the current ratio is manageable.
Revenue is stable or growing over recent quarters — demand appears durable.
5 of the last 8 quarters had negative FCF — inconsistent cash generation raises sustainability concerns.
Shares decreased 21.8% — net buybacks are reducing shares outstanding and boosting per-share value.
Quarterly standardized metrics.
Stock price and market valuation
Revenue and earnings growth across quarters
Assets, cash, debt, and leverage
Price multiples and return ratios
Operating efficiency and return metrics
Free cash flow, earnings quality, and capital allocation