Airlines are extremely low-margin businesses, discount airlines like SWA doubly so. “Posting a record loss” of this magnitude isn’t something that can be afforded. What you’re talking about is likely to turn into some form of bankruptcy. Maybe it’s a relatively minor Chapter 11 where all those refunds get written down by the bankruptcy court, or maybe SWA goes the way of TWA and Pan-Am.

Airlines make a lot of their money from loyalty programs

https://www.forbes.com/sites/advisor/2020/07/15/how-airlines...

And loyalty programs are bigger business for the higher end airlines that cater to business travels and the more affluent.

On top of that, the top 3 airlines make a lot of money off a first class and business travelers who are using other people’s money.

You just listed a bunch of revenue sources SWA doesn’t have.

That’s the point…

Gotcha.

Or maybe their lobbyists get on the phones and secure them a nice bailout, since they’re so “essential” as we’ve just seen.

Replying to a sibling comment. There will never be a bailout for SWA. Too small, too many competitors and based in a red state with a blue administration in power.

They lost $300M in Q1 and made $800M in Q2. They can take another $300M loss (1B?) in the short term to mitigate reputational damage and legislation.

In the last fiscal quarter pre-pandemic, they had operating income of $3 billion on revenue of $22 billion, or 13%. This is not a low-margin business.

If they have operating income of eight to ten billion a year, spending a third of a billion to upgrade systems seems like it would have been a reasonable investment instead of buying back shares and increasing the dividend.