How does Southwest Airlines (LUV) make money?

Southwest Airlines (LUV) generates revenue primarily from Passenger, which accounted for 91.1% of total revenue in TTM through Q1 2026. The company reported $28.88B in revenue and converted 2.8% of it into net profit, equivalent to roughly $817.00M in net income — what's left after the cost of revenue, operating expenses, interest, and income taxes.

What is the gross profit margin of Southwest Airlines (LUV)?

Southwest Airlines (LUV) reported a gross profit margin of 16.5% in TTM through Q1 2026, equivalent to $4.75B in gross profit on $28.88B in revenue. Gross margin measures how much of each dollar of revenue remains after the direct cost of producing or delivering the product — a higher figure typically signals pricing power, scale, or a less capital-intensive business model.

What is the operating profit margin of Southwest Airlines (LUV)?

Southwest Airlines (LUV) reported an operating profit margin of 3.4% in TTM through Q1 2026, equivalent to $981.00M in operating income. Operating margin captures profitability after research & development, sales & marketing, and general & administrative expenses — but before interest, taxes, and one-off items — and is the cleanest single read on the underlying business's efficiency.

What is the net profit margin of Southwest Airlines (LUV)?

Southwest Airlines (LUV) reported a net profit margin of 2.8% in TTM through Q1 2026, equivalent to $817.00M in net income. Net margin is the bottom-line share of revenue that survives every expense — operating costs, interest, and income taxes — and is the figure that flows directly into earnings per share.

Is Southwest Airlines (LUV) profitable?

Yes. Southwest Airlines (LUV) reported $817.00M in net income for TTM through Q1 2026, with a net profit margin of 2.8%. The company earned more from its operations than it paid out in costs, interest, and income taxes, leaving positive earnings on the bottom line.

How much does Southwest Airlines (LUV) spend on capital expenditures?

Southwest Airlines (LUV) spent $2.80B on capital expenditures (CapEx) during TTM through Q1 2026, roughly 9.7% of total revenue. CapEx represents long-lived investment in property, equipment, data centres, and other physical infrastructure, and is subtracted from operating cash flow to arrive at free cash flow.

How much free cash flow does Southwest Airlines (LUV) generate?

Southwest Airlines (LUV) generated −$401.00M in free cash flow during TTM through Q1 2026, a free-cash-flow margin of -1.4%. Free cash flow is the cash left after capital expenditures and represents the discretionary pool the company can use to pay dividends, repurchase shares, repay debt, or fund acquisitions without raising external capital.

What is the effective tax rate of Southwest Airlines (LUV)?

Southwest Airlines (LUV) had an effective tax rate of 21.4% in TTM through Q1 2026. The effective rate is the actual share of pre-tax income paid as income taxes and can differ materially from the statutory rate due to foreign earnings mix, tax credits (such as R&D), share-based compensation deductions, and one-off discrete items.

What are the main business segments of Southwest Airlines (LUV)?

Southwest Airlines (LUV) reports revenue across 3 reportable product segments, led by Passenger at 91.1% of total revenue in TTM through Q1 2026. See the revenue-by-segment table on this page for the full breakdown and how each segment feeds into the income-statement waterfall above.

How Southwest Airlines Makes Money: 2026 Visual Revenue Map

Southwest Airlines (LUV) Income Statement Flow — TTM through Q1 2026

Calculated from the four most recent reported quarters, ending March 31, 2026 (reported April 23, 2026).

Southwest Airlines discloses geographic revenue only in annual filings. to view the full breakdown.

Southwest Airlines (LUV) Revenue by Product Segment — TTM through Q1 2026

Aggregated from the four quarterly disclosures behind this TTM. Minor differences vs the company's annual filing can occur if reported segments changed mid-year.

Revenue contribution by product segment for Southwest Airlines (LUV) in TTM through Q1 2026.
Segment	Revenue (USD)	% of total
Passenger	$26.32B	91.1%
Product and Service, Other	$2.40B	8.3%
Cargo and Freight	$174.00M	0.6%
Total	$28.88B	100%

Passenger$26.32B
Product and Service, Other$2.40B
Cargo and Freight$174.00M
Total$28.88B

Revenue Breakdown — TTM through Q1 2026

In TTM through Q1 2026, Southwest Airlines (LUV) reports revenue across 3 operating segments; the largest segment was Passenger at 91.1%, followed by Product and Service, Other (8.3%) and Cargo and Freight (0.6%).

Frequently asked questions

Data & methodology

Southwest Airlines (LUV) Key Financials

Charts, filings, and peer comparison for every metric

Explore more

Deep-dives across the income statement, cash flow, capital return, and valuation