According to Reuters, Southwest Airlines (NYSE: LUV) announced today it nearly doubled its profit from $57 million in Q4 ‘06 to $111 million in Q4 ‘07, exceeding analyst expectations. A good portion of the budget carrier’s increase came via a 154% gain in its fuel hedging positions (up from $118 million to about $300 million). The announcement, while positive, did little to allay the market’s concerns about rising fuel costs and their impact on airline stocks moving forward.
A Glimmer of Hope
Still, Southwest offers a small glimmer of hope in a tough industry, and continues to maintain a focus on customer service through conduits such as its Rapid Rewards program and Business Select offering. Further, it continues to innovate. Per CEO Gary Kelly, Southwest will start testing inflight internet connectivity on several of its aircraft this year.
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