SOUTHWEST AIRLINES CO
For the period ended Dec 31, 2025. Filed Feb 5, 2026.
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FY2025 · Filed Feb 5, 2026
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3. Net Income Per Share
- NET INCOME PER SHARE
The following table sets forth the computation of basic and diluted net income per share (in millions except per share amounts). Basic net income per share is calculated by dividing net income by the weighted average of shares outstanding during the period. Diluted net income per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock. An immaterial number of shares related to the Company's restricted stock units were excluded from the denominator for the fiscal years ended December 31, 2024 and 2023 because inclusion of such shares would be antidilutive. There were no antidilutive restricted stock units for the fiscal year ended December 31, 2025. During second quarter 2025, the Company's remaining balance of 1.25 percent Convertible Senior Notes due 2025 (the "Convertible Notes") of
$1.6 billion was repaid, settling both principal and accrued interest. Since they were outstanding for a portion of the period prior to repayment, the Convertible Notes had a weighted-average dilutive impact on the net income per share calculation for the year ended December 31, 2025.
| Year ended December 31, | |||
|---|---|---|---|
| 2025 | 2024 | 2023 | |
| NUMERATOR: | |||
| Net income | $441 | $465 | $465 |
| Add: Interest expense (a) | 6 | 20 | 19 |
| Deduct: Unrealized mark-to market adjustment on forward contract (a)(b) | (5) | — | — |
| Net income attributable to common stockholders | $442 | $485 | $484 |
| DENOMINATOR: | |||
| Weighted-average shares outstanding, basic | 540 | 598 | 595 |
| Dilutive effects of convertible notes | 15 | 43 | 43 |
| Dilutive effect of restricted stock units | 3 | 2 | 2 |
| Adjusted weighted-average shares outstanding, diluted | 558 | 643 | 640 |
| NET INCOME PER SHARE: | |||
| Basic | $0.82 | $0.78 | $0.78 |
| Diluted | $0.79 | $0.76 | $0.76 |
(a) Net of profitsharing benefit and income taxes
(b) See Note 8 for further information
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