American Airlines Group vs Southwest Airlines
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KIRA’s take AI analyst
I put American Airlines Group and Southwest Airlines side by side, using each one’s latest annual report. Here is what stands out:
- American Airlines Group is the larger business, with $54.6B of revenue in fiscal 2025 against $28.1B for Southwest Airlines, about 1.9 times as much.
- Southwest Airlines grew revenue faster (2.1%, against 0.8%).
- American Airlines Group kept more of each dollar of sales as operating profit (2.7% operating margin, against 1.5%).
- American Airlines Group turned more of its sales into free cash flow (−1.2% FCF margin, against −3.0%).
- American Airlines Group earned a higher return on the capital invested in it (5.7%, against 3.7%).
Who comes out ahead
Of the 9 measures where higher (or lower) is clearly better, how many each company leads.
American Airlines Group
AAL
4/9
5-year growthOperating marginFCF marginReturn on capital
Southwest Airlines
LUV
5/9
Revenue growthNet marginPiotroski F-scoreNet debt / EBITDAShare count change
Side by side
Best in the row
| Latest fiscal year | AAL FY25 | LUV FY25 |
|---|---|---|
| Size | ||
| Market cap | $8.1B | $21.2B |
| Revenue | $54.6B | $28.1B |
| Free cash flow | −$680M | −$831M |
| Net income | $111M | $441M |
| Growth | ||
| Revenue growth | 0.8% | 2.1% |
| 5-year growth | 25.8% | 25.4% |
| Share count change | −8.4% | −13.2% |
| Profitability | ||
| Gross margin | — | — |
| Operating margin | 2.7% | 1.5% |
| Net margin | 0.2% | 1.6% |
| FCF margin | −1.2% | −3.0% |
| Return on capital | 5.7% | 3.7% |
| Return on equity | — | 4.8% |
| Balance sheet | ||
| Net debt | $19.4B | $1.8B |
| Net debt / EBITDA | 5.3x | 0.9x |
| Dividends and buybacks | $0.0M | $2.9B |
| Valuation & quality | ||
| P/E | — | 20.9x |
| Piotroski F-score | 5 | 7 |
Ten years
Revenue
Operating margin
Free cash flow
Return on capital
Each company's latest fiscal year; fiscal years end in different months. The best value in each row is highlighted where higher (or lower) is clearly better. Not investment advice.