Southwest Airlines passenger revenues in the second quarter
increased 6.7 percent year over year to a quarterly record of $5.2 billion,
despite an impact from its cutover to a new reservations system during the
quarter.
Southwest CEO Gary Kelly said the May cutover to its new
Amadeus-based reservation system was "literally a flawless
deployment" in terms of operations, though the carrier is still working
through a few minor issues that affected revenues during the quarter. For
example, gate agents are having difficulty selling Southwest's Upgraded Boarding
product—the ability for passenger to buy a position in the first boarding group
at the gate—and canceled reservations from its group sales product are not
always going back into the inventory to be resold, he said. Southwest already
is working on fixes for those issues, he said.
"Aside from what I would describe as normal breaking-in
issues, it is all we expected it to be," Kelly said. "Frontline
employees have worked hard to learn and use a new system, and they have made it
look easy to our customers."
Southwest also reported its first growth in average fares, up
1.5 percent year over year to $153.95 in the second quarter, for the first time
in about two years, Kelly said. Traffic increased 5.1 percent year over year during the
quarter, the same rate at which Southwest increased capacity. Load factor was
flat year over year at 85.6 percent.
Southwest's net income for the quarter was $746
million, down from $820 million in the second quarter of 2016.