Southwest Airlines on Monday said it expects revenue to fall in the second quarter after a decline in bookings following a deadly engine failure aboard one of its flights in April.
The airline, which carries more travelers within the U.S. than any other carrier, forecast a 3 percent drop in revenue it generates per each seat it flies a mile, a key industry metric. The airline had warned of a 1 percent to 3 percent drop in operating revenue per available seat mile in April following the accident after it pulled marketing.
Southwest, a low-cost airline with peppy advertising campaigns, changed its website and tone after the April 17 accident. A fan blade broke off one of Southwest’s Boeing 737’s engines when a New York to Dallas flight was flying above 30,000 fleet. Debris scattered, rupturing a window and partially sucking one passenger, who died, out of the opening. The plane made an emergency landing in Philadelphia.
Southwest also warned it is trimming its growth plans this year because of a surge in fuel prices, increasing capacity, or the number of seats it offers, in the “low four percent range” from a previous plan of around 5 percent.
Southwest’s shares were little changed on Monday in premarket trading, and are down 22 percent so far this year, while the NYSE Arca Airline index is down about 10 percent.
