Southwest Airlines has trimmed its average core cash burn forecast by $1m a day for the second quarter.
The airline said that improving demand for leisure travel was expected to more than offset higher fuel prices.
US airlines are preparing for a rebound in summer bookings after nearly a year in the doldrums as mass vaccination gains pace and countries ease travel restrictions for vaccinated travelers.
Southwest said it had seen improvements in leisure passenger travel demand and bookings for May and June this year, adding that based on current bookings, leisure fare levels in June are nearing June 2019 levels.
The company also said it was continuing to see "modest, consistent improvements" in business passenger demand and bookings, though it still lagged leisure travel trends.
The company now estimates its average core cash burn, excluding changes in working capital, to be in the range of $1-3m a day in the quarter, compared with its previous estimation in the range of $2-4m a day.
Cash burn, a measure that US airlines began providing in 2020 to measure liquidity in light of the pandemic hit, was about $6m a day in April. The company said operating revenues for the month performed in line with its expectations.
Southwest added it now expects capacity to increase about 87% in the second quarter from the year-ago quarter.
This compares with its previous forecast of a rise of about 90%, primarily due to changes in its service plans.
The Dallas, Texas-based carrier also raised its estimates for fuel costs in the second quarter to be between $1.90 and $2 a gallon, from its previous forecast in the range of $1.85 to $1.95 a gallon.
