Southwest Airlines Co. warned that costs will climb faster than expected as it grapples with heavy labor expenses, undercutting gains from strong demand for leisure travel.

Southwest Airlines stock was falling on Thursday after the carrier’s fourth-quarter revenue and forward guidance both came in a little short of Wall Street’s expectations. Shares fell 2.7% to $30.80 in premarket trading.

The airline also forecast better-than-expected unit revenue (RASM), a proxy for pricing power, for the first quarter. Airlines across the U.S. have cut seating to boost fares after a surplus capacity, introduced last summer in anticipation of a demand surge, forced airlines to offer discounts and sacrifice margins.

Southwest Airlines said Thursday it swung to a fourth-quarter profit of 42 cents a share from a year-ago loss of 42 cents a share, as overall expenses fell on lower fuel costs.

The class action lawsuit, filed on behalf of 60,000 plan participants, alleges the airline failed to replace a “chronically underperforming” large-cap fund holding over $2 billion in retirement plan assets for 15 years – and “still continues to this day.

Despite pressure to cut costs and an activist investor campaign, Southwest reported a healthy profit for the fourth quarter.

American Eagle flight 5342 collided with a Black Hawk helicopter over the Potomac River, home to some of the country's most restricted airspace.

Figure skaters and coaches returning from the national championships were aboard the American Airlines flight that collided with a Black Hawk helicopter near Reagan National Airport on Wednesday, the U.

Below are the earnings highlights for Southwest Airlines Inc. (LUV): Earnings: $261 million in Q4 vs. -$252 million in the same

Southwest's results echo sentiments laid out by Delta Air Lines, which reported quarterly results earlier in the month. Delta said demand accelerated throughout the fourth quarter, with a handful of its highest revenue days in history taking place in November and December. The company also expects travel demand to remain strong this year.

In the midst of the airline’s financial woes, the company just revealed that it will be making some major changes in an effort to cut costs. According to a new report from CNBC, Southwest Airlines is putting a freeze on corporate hiring and promotions.

An American Airlines jet with 60 passengers and four crew members aboard collided Wednesday with an Army helicopter while landing at Ronald Reagan National Airport near Washington, prompting a