Southwest shares fall on disappointing revenue outlook

Southwest is giving a surprisingly weak revenue forecast, the latest sign that airfares aren't rising as quickly as airlines expected.

Shares of Southwest Airlines Co. fell 56 cents, or 1 percent, to $55.80 in Friday afternoon trading.

Average fares fell in 2015 and 2016 as competition increased from discount airlines including Spirit Airlines and Frontier Airlines. Trends in recent months have pointed to higher fares this year, but Southwest's pullback follows cautious outlooks from American and Delta.

Southwest, the nation's fourth-biggest airline, said it expects a decline of 2 percent to 3 percent in revenue for each seat flown one mile compared with the first quarter of 2016.

That's a closely watched number in the airline business, and it generally tracks fares.

(The Associated Press)