Southwest Airlines To Slash Corporate Workforce By 15%, Retail Chatter Heats Up

Southwest Airlines (LUV) garnered retail attention on Monday after the company said it would lay off 15% of its corporate workforce as part of a restructuring plan.

The job cuts would affect about 1,750 employees, almost entirely in corporate overhead and leadership positions. The airline company would also lay off 11 employees in senior leadership positions, including vice presidents and above.

The layoffs are expected to be completed by the end of the second quarter, the company said.

"This decision is unprecedented in our 53-year history, and change requires that we make difficult decisions,” CEO Bob Jordan said.

The Dallas-based company said following the layoffs, it expects partial-year 2025 savings to be about $210 million and full-year 2026 savings to be about $300 million.

Southwest said that the savings exclude an anticipated one-time charge in the first quarter between $60 million and $80 million, substantially all of which is related to severance payments and post-employment benefits.

The company unveiled a plan to reduce $500 million in costs through 2025 in September last year.

It had flagged during its fourth-quarter earnings call that it was experiencing above-normal unit cost inflation, primarily in market-driven wage rates, airport costs, and health care.

Southwest also named former United Airlines executive Tom Doxey as its chief financial officer earlier in February.

The company had reported record full-year and fourth-quarter operating revenue in January.

Retail sentiment on Stocktwits moved higher in the ‘extremely bullish’ (90/100) territory than a day ago, while retail chatter rose to ‘high’ levels.

Over the past year, Southwest stock has fallen 11.8% and lagged behind rivals Delta Airlines and United Airlines.   

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