Southwest Airlines’ stock rises after seeing ‘modest improvement’ in passenger demand in August

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Shares of Southwest Airlines Co. rose 1.4% in premarket trading Wednesday, after the air carrier said that while revenue and bookings “stalled” in early July, and remain “depressed” for the rest of the month, there was “modest improvement” in close-in leisure passenger demand so far in August. The company said July revenue fell 70% to 75% from a year ago as a result of the COVID-19 pandemic, while capacity decreased 31% and load factor was about 43%, which were all in line with previous expectations. For August, Southwest expects revenue to be down 70% to 75%, capacity to fall to 27% and load factor to be in the range of 40% to 45%. The company had previously expected August revenue to drop 70% to 80%, capacity to be down 20% and load factor to be 30% to 40%. The stock has tumbled 36.7% year to date through Tuesday, while the U.S. Global Jets ETF dropped 46.8% and the S&P 500 gained 4.9%.
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