American Airlines has small profit, Southwest loses $159 million

DALLAS — American Airlines eked out a narrow profit for the first quarter, while Southwest Airlines lost $159 million as it felt aftershocks from the December meltdown that caused thousands of canceled flights.

Both airlines said today that they expect to be solidly profitable in the April-through-June quarter that includes the start of the peak summer travel season.

American earned $10 million and revenue jumped 37% from a year ago, as planes were relatively full during what is normally the slowest travel period of the year.

Excluding one-time items, the Fort Worth, Texas-based airline said it earned five cents per share, a penny better than analysts expected. The company lowered expectations two weeks ago.

American said it expects to earn between $1.20 and $1.40 per share in the second quarter, which would beat analysts’ average forecast of $1.04 per share.

Southwest said that despite the first-quarter loss it made money in March and expects to be back in the black in the second quarter — although it did not provide a figure.

Southwest had already indicated it would lose money in the first quarter. The loss was narrower than Southwest’s $278 million loss a year earlier. After one-time items, it worked out to 27 cents per share, matching the expectation of analysts surveyed by FactSet.

Revenue rose 22% to a first-quarter record of $5.71 billion, slightly less than analysts expected.

The Dallas-based airline said the winter breakdown cost $380 million in the quarter from lost bookings and extra expenses. Southwest failed to bounce back after a winter storm just before Christmas, and its problems were compounded when its crew-rescheduling system broke down, leading to 16,700 canceled flights in a 10-day stretch.

Airlines are looking ahead to this summer. Strong travel demand and a limited supply of flights are keeping average fares high, which will boost airline revenue. But the carriers are facing higher costs for labor and fuel, plus the possibility of a recession that could hurt ticket sales.