Southwest Airlines as well as American Airlines have raised the revenue assumptions for the fourth quarter of 2024 as they benefit from strong demand and pricier fares and the stock is surging significantly. 

Southwest Airlines boosted its outlook on unit revenue in the fourth quarter, raising it 5.5% to 7% compared to last year. This surpassed a previous outlook for no better than 5.5% improvement. According to the company, it is able to achieve this by virtue of network adjustments that allow it to eliminate unprofitable flights. Meanwhile, Southwest is optimistic about the demand for travel up through the end of the year, particularly during the busiest holiday period, and the firm believes that this strong revenue trend will be sustained into 2025. The firm also indicated that it is planning to finalize its first sale-leaseback transaction, which involves aircraft, during early 2025. 

American Airlines increased its view for the fourth quarter of 2024, where the company expects its unit revenue to be flat or up as much as 1% in that period versus the same period in 2023. That is better than the previous forecast that had plummeted as much as 3%. Aside from its upwardly adjusted earnings guidance-a range of 55 cents to 75 cents, per share-up from its original guidance at 25 to 50 cents per share-American also told investors of a major new co-branding partnership involving it. Following the cut-off of years of affiliation with Barclays-as had been long in coming-that carrier also named Citi as its single credit card issuer. 

The positive updates from both airlines follows an earlier in the week increase in revenue forecast by JetBlue Airways. JetBlue announced that it would keep streamlining its operations by eliminating unprofitable routes and changing its summer 2025 Europe schedule. As the airlines are riding this promising trend, prospects for the rest of 2024 and into next year look bright indeed, supported by persistent demand for travel and strategic operational adjustments.