Elliott Investment Management disclosed on Monday that it has a $1.9 billion stake in Southwest Airlines, which amounts to approximately 11%. The activist investor didn’t waste time putting pressure, going public with calls for a new leadership at the airliner.
Elliott sent a letter to Southwest’s board, criticizing the company’s inability to “evolve,” poor financial performance in recent quarters, and the work of CEO Robert Jordan.
“Poor execution and leadership’s stubborn unwillingness to evolve the Company’s strategy have led to deeply disappointing results for shareholders, employees and customers alike,” Elliott wrote in the letter, adding that they believe “that new leadership is required at Southwest.”
Responding to the letter with a statement, Southwest reiterated their support for Jordan and management while adding that they are looking forward to a “better understanding” of Elliott’s views on the company.
Southwest’s revenue for the past quarter came at $6.33 billion, marking a 10.92% increase year over year. However, the airliner saw its net income dip by 45.28% and incurred a net loss of $231 million or $0.39 loss per diluted share.
After the news of Elliott’s stake went public, Southwest’s stock jumped by 7% to close at $29.72 per share. The company’s shares are up around 3% year-to-date.