Southwest Airlines said Thursday that last week's Flight
1380 accident, which claimed the life of one passenger, has depressed bookings.
The airline forecasts that second-quarter revenue will be
down 1% to 3%, mostly due to the impact of the accident, in which one of the
engines blew apart at 32,000 feet, spraying the plane with shrapnel and causing
a window to burst. Jennifer Riordan, 43, was partially sucked out the window
and died.
During the airline's first-quarter earnings call on Thursday,
Southwest president Tom Nealon said the airline sees an impact on travel "for
May and beyond."
Southwest will begin to recover when it restarts marketing
efforts, he said.
"We really do want to get our marketing back online
with our paid search," Nealon said. "And keep in mind, we are not
running any TV or any social [media] right now. The reason we're not doing that
is because our TV and our social has a lot of personality, and it has a lot of
fun. And we just don't think it's appropriate yet to bring that back up on line."
Southwest CEO Gary Kelly called the booking softness since
the accident "predictable." He is confident in a rebound.
"Demand has been strong, it remains strong. Tax reform
should help that. Our outlook is positive, and the prospect of record non-GAAP
earnings per share is very much alive," he said.
Southwest reported a strong first quarter, saying net income
was $438 million excluding special items, a 22% increase. The
airline's net margin was 8.9%, up from 7.4%, due to the realization of savings
from the lower corporate tax rate, said CFO Tammy Romo.