Southwest’s profitability has been well-publicized, and they’ve had another fine quarter due to them running a fantastic operation, and their oft-discussed fuel hedges. Well done.
Allegiant, which I speak of frequently, also turned a tidy profit and got almost no credit for it. Their management team has built an impressive operation around a tight strategy: fly leisure travelers from tertiary cities a couple of times a week to sun destinations, and upsell everything. And this works. Really well. Their planes were 94% full in June, and 90% full for the quarter. Their non-air revenue per passenger hit almost $28 (JetBlue is about $8). They are basically a seller of travel products (hotels, show tickets, etc) that happen to run an airline. Oh, and they manage to do that flying old MD-80s with no fuel hedges. Incredibly impressive.
(I own a small number of shares in Allegiant…)