Southwest Airlines posted a first-quarter loss after the airline suffered a major operational letdown during the busy holiday season. The company’s stock dropped to 30.90 on Thursday from 32.16 during the previous session.
Based in Dallas, Texas, Southwest Airlines suffered a major operational failure that resulted in the company canceling more than 16,700 flights around the holiday season; a decision that cost the airline over $800 million.
In response to this failure, the Department of Justice (DOJ) on Monday joined an ongoing investigation with the Department of Transportation to determine “whether Southwest engaged in unrealistic flight scheduling which is illegal under federal law, and whether Southwest Airlines provided timely refunds and reimbursements to affected passengers as required.”
Following the busy festive season, Southwest Airlines again suffered a temporary halt in operations when a “data connection” issue led to the delay of 1,820 flights.
The first quarter saw Southwest incur an adjusted loss per share of $0.27; worse than analysts’ forecasts of a $0.22 loss per share. The company lost $159 million in the quarter.