(Reuters) -Southwest Airlines on Thursday raised its fourth-quarter available seat mile revenue forecast, benefiting from better pricing and a rebound in domestic travel demand.
Shares of the low-cost airline rose about 2.5% before the bell rang.
Travel demand has seen an increase since the holiday season and after the US presidential election.
Southwest said it was encouraged by recent revenue and future booking trends, and expects them to continue through 2025.
On Monday, the US Transportation Security Administration said it had screened the largest number of airline passengers in a single day: 3.08 million.
However, the airline has struggled to find its footing post-pandemic, in part due to aircraft delivery delays from Boeing (NYSE ) and industry-wide overcapacity in the domestic market.
That led it to make a series of efforts over the past year to help revitalize demand, including partnerships, seats with more legroom for customers and aircraft leasing.
In October, the airline announced it had reached a deal with activist Elliott to end a bitter board battle that had raged for months.
Southwest added Thursday that it continues to take about 20 deliveries of Boeing 737-8 aircraft this year and expects to retire about 40 older 737 models from its fleet.
The airline now expects its fourth-quarter RASM, an indicator of pricing power, to rise between 5.5% and 7%, compared to its previous expectation of between 3.5% and 5.5 %.
It also expects its economic fuel costs per gallon for the current quarter to fall in a range of $2.35 to $2.45, down from its previous guidance of $2.25 and $2.35.
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