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Southwest Airlines Is Rewriting Its Revenue Playbook With Product Segmentation!

Southwest Airlines has recently reported a strong performance for the fourth quarter of 2025, marking a significant milestone in its transformative efforts. The company has seen an impressive upward movement in operating revenues, reaching $7.4 billion for the fourth quarter and $28 billion for the full year, both of which are quarterly and annual records. The company achieved an EBIT of $574 million, surpassing prior forecasts and demonstrating solid execution on their strategic initiatives. Throughout 2025, Southwest Airlines has made substantial changes to its business model. These include the introduction of bag fees, the addition of a basic economy fare product, and strategic amendments to its Rapid Rewards program. Other initiatives include revamping their co-branded credit card agreement with Chase, offering free WiFi for loyalty members through a partnership with T-Mobile, and expanding online presence via collaborations with Expedia and Priceline.