(Bloomberg) -- Southwest Airlines Co. and JetBlue Airways Group Inc. strengthened their revenue outlook for this quarter, citing strong summer travel demand even in the face of inflation.
Southwest expects revenue to climb as much as 15% from 2019, compared with an earlier outlook for growth of up to 12%, the Dallas-based carrier said in a regulatory filing. It credited full planes and higher fares. Bookings are exceeding expectations at JetBlue, which now sees revenue “at or above” the high end of its previous guidance for growth of as much as 16%.
US carriers are counting on the surge of summer travel as consumers shrug off broadly higher prices to initiate a return to sustained profitability after two years of depressed demand linked to the coronavirus pandemic. Full planes are allowing airlines to boost fares, in some cases enough to offset higher fuel prices. Southwest reiterated its forecast for second-quarter and full-year profits. Both carriers commented ahead of presentations at a Wolfe Research investor conference Thursday.
United Airlines Holdings Inc. offered a similarly upbeat forecast last week, saying passenger revenue would jump as much as 25% in the quarter over the 2019 level.
Southwest and JetBlue shares each rose 2.1% as of 9:11 a.m. in New York, ahead of regular trading.
Southwest maintained an earlier outlook for second-quarter capacity to be 7% below the same period in 2019, while JetBlue said capacity will be up 2% to 3%, compared with flat to up 3% previously. JetBlue expects to pay $4.08 a gallon for fuel, up from an earlier forecast of $3.79. Southwest, which uses hedging contracts to help offset price spikes, will pay as much as $3.40, compared with a prior outlook of as much as $3.15.
Unit costs, a measure of efficiency, will rise as much as 18% at Southwest and 17% at JetBlue, both unchanged from prior forecasts. The guidance excludes fuel.
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