Southwest Airlines posted June-quarter net income of $224 million, down slightly from $228 million in the prior-year period.

The carrier's average quarterly fare increased 0.4 percent year over year to $151.23, with a 0.4 percent increase in paying passengers. Total traffic was up 2.7 percent  as capacity increased 3 percent. "While the lingering effects of government sequestration and higher taxes continued to be a drag on air travel demand, second-quarter 2013 revenues and passenger traffic still reached record levels," according to CEO Gary Kelly.