The purpose of this assignment is for students to receive Six Sigma Yellow Belt Training Executing DMAIC Six Sigma quality improvement (analyze, improve, and control) projects. Assignment Steps Resources: Microsoft® PowerPoint® ( Southwest Airlines) Ex

Southwest Airlines Co. Profile

2702 Love Field Dr Dallas, TX 75235 United States Phone : 214-792-4000 Fax : 214-792-5015 http://www.southwest.com

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WELCOME

HIDDEN TEXT TO MARK THE BEGINNING OF THE TOC

PAGE iDec 01, 2016• •866-541-3770 HOOVERS.COM

Table of Contents 2Company Overview

Key Information 2

Key Financials 2

Company Rankings 2

Key People 3

4Company Description

5Company History

6Industry Information

7People

People 8

Board Members 9

9Biographies

Gary C. Kelly 10

Ron Ricks 10

Michael G. (Mike) Van de Ven 11

Tammy Romo 12

Craig Maccubbin 13

Randy Sloan 13

Robert E. (Bob) Jordan 13

Jeff Lamb 14

Tom Nealon 15

Ryan Green 15

Jim McKeon 15

Jeff Martin 15

Vance Toler 15

Michael Van Houweling 15

Julie Weber 16

Robert (Bob) Champagne 16

Megan (Meg) Lee 16

Alison (Alli) Schermerhorn 16

Jeffery Hillis 16

Cheryl Hughey 16

Jennifer (Jen) Paine 16

Brandon (Bran) Hopper 16

Del Mann 16

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Jeff Mitchell 17

Joe (Joey) Paris 17

Steven (Steve) Stockton 17

Earl Thompson 17

16Company Financials

Financial Summary 16

Annual Income Statement 18

Quarterly Income Statement 19

Annual Balance Sheet 20

Quarterly Balance Sheet 21

Annual Cash Flow 22

Quarterly Cash Flow 23

Earnings Estimates 24

Financial Market Data 25

Historical Financials 26

27Competition

Competitors List 27

Competitive Landscape 28

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Company Overview 2702 Love Field Dr Dallas, TX 75235 United States Phone : 214-792-4000 Fax : 214-792-5015 http://www.southwest.com

Southwest Airlines will fly any plane (as long as it's a Boeing) and let passengers sit anywhere they like (as long as they get there first). Sticking with what has worked, Southwest has expanded its low-cost, no-frills, no-reserved- seats approach to air travel throughout the US to serve nearly 90 destinations across North America. Now the largest carrier of US domestic passengers, Southwest still stands as an inspiration for scrappy low-fare upstarts the world over. The carrier has enjoyed 43 straight profitable years, amid the airline industry's ups and downs. Southwest's fleet numbers about 700 aircraft, including 700 Boeing 737s.

Key Information DUNS Number 055329262

Location Type Headquarters Subsidiary Status No Manufacturer No Company Type Public Plant/Facility Size (sq. ft.) 17,522.00 Foreign Trade Imports Accountant Ernst & Young LLP Total Employees 49,583 1-Year Employee Growth 7.14% Employees At This Location 3,064 Year of Founding or Change in Control 1971 Primary Industry 1600:Airlines Primary SIC Code 45120000:Air transportation, scheduled Primary NAICS Code 481111:Scheduled Passenger Air Transportation Tradestyle Southwest Airlines Latitude/Longitude 32.845398 / -96.864547

Key Financials Fiscal Year-End December Sales ($ M) $19,820.00M 1-Year Sales Growth 6.53% Net Income $2,181.00M 1-Year Net Income Growth 91.99% Total Assets $21,312.00M Market Value $29,080.85M

Prescreen Score Low Risk

Company Rankings 142 in FORTUNE 500 (June 2016) S&P 500 Dow Jones Transports 387 in FT Global 500 (June 2015) 142 in FORTUNE 1000 (June 2016)

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Key People

Name Title

Mr. Gary C. Kelly Chairman, President, and CEO

Mr. Ron Ricks Vice Chairman

Mr. Michael G. (Mike) Van de Ven EVP and COO

Ms. Tammy Romo EVP and CFO

Mr. Craig Maccubbin VP Technology Operations and CTO

Mr. Randy Sloan SVP and CIO

Mr. Robert E. (Bob) Jordan EVP and Chief Commercial Officer; President, AirTran Airways

Mr. Jeff Lamb EVP Corporate Services and Aiport Affairs

Mr. Tom Nealon EVP Strategy and Innovation

Mr. Ryan Green VP Marketing

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Company Description

Geographic Reach Southwest serves more than 90 destinations in some 40 US states in addition to the District of Columbia, Puerto Rico, Mexico, Jamaica, The Bahamas, Aruba, and the Dominican Republic. Operations Simplicity has been key to Southwest's success. Most of the carrier's flights are less than two hours, and it usually lands at small airports to avoid congestion at competitors' larger hubs; in Dallas it's the big dog at little Love Field, its birthplace, and in Chicago it accounts for most of the traffic at Midway Airport. Southwest's (and AirTran's) fleet consists primarily of one type of aircraft -- the Boeing 737 -- to minimize training and maintenance costs. Financial Performance

Southwest has achieved unprecedented growth over the last six years. Its revenues grew 7% from $18.6 billion in 2014 to $19.8 billion in 2015, a historic milestone. Profits also skyrocketed 92% from $1.1 billion in 2014 to a record-setting $2.2 billion in 2015 due to the higher revenue coupled with a significant decline in fuel and oil prices. The historic growth for 2015 was driven by a bump in passenger revenues fueled by increased passenger yield, increased fares, and a marginal increase in capacity. Freight revenues for 2015 also rose by 2% primarily due to higher average rates charged as a result of fuel surcharges and an increase in other revenues. Southwest's operating cash flow increased from $2.9 billion in 2014 to $3.2 billion in 2015 due to the higher profits in addition to cash generated from accounts payable and accrued liabilities and air traffic liability. Strategy Protective of its low-cost image, Southwest has staunchly resisted charging passengers baggage fees. However, it has seen the value of this strategy and has rolled out new fees that have included allowing passengers to bring small dogs or cats into the cabin for a one-way charge of $75 and charging a one-way $50 fee for unaccompanied minors. A large part of the carrier's strategy to stay profitable includes fleet modernization. Southwest is replacing older Boeing 737 planes with the larger and more fuel-efficient Boeing 737-800 for expansion to locations of greater distance, and it plans to begin using another new fuel-efficient model, the Boeing 737 Max, in 2017.

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Company History

Company Background Texas businessman Rollin King and lawyer Herb Kelleher founded Air Southwest in 1967 as an intrastate airline linking Dallas, Houston, and San Antonio. The now-defunct Braniff and Texas International sued, questioning whether the region needed another airline, but the Texas Supreme Court ruled in Southwest's favor. In 1971 the company, renamed Southwest Airlines, made its first scheduled flight. Operating from Love Field in Dallas, Southwest adopted "love" as the theme of its early ad campaigns, serving love potions (drinks) and love bites (peanuts). When other airlines moved to the new Dallas/Fort Worth International Airport (DFW) in 1974, Kelleher insisted on staying at Love Field, gaining a virtual monopoly there.

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Industry Information Hoover's Industries

> Transportation Services Sector

> Airlines ( primary )

Denotes In-depth Industry Insight by Hoover's Editorial Staff

Primary SIC Code 45120000 : Air transportation, scheduled Primary NAICS Code 481111 : Scheduled Passenger Air Transportation

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People

Employees

Name Age SalaryTitle Bonus

Mr. Gary C. Kelly $675,000.00 --60Chairman, President, and CEO Mr. Ron Ricks $468,750.00 --66Vice Chairman Mr. Michael G. (Mike) Van de Ven

$469,375.00 --54EVP and COO

Ms. Tammy Romo $451,250.00 --53EVP and CFO Mr. Craig Maccubbin -- --49VP Technology Operations and CTO Mr. Randy Sloan -- --SVP and CIO Mr. Robert E. (Bob) Jordan $469,375.00 --55EVP and Chief Commercial Officer;

President, AirTran Airways Mr. Jeff Lamb $448,750.00 --53EVP Corporate Services and Aiport

Affairs Mr. Tom Nealon -- --EVP Strategy and Innovation Mr. Ryan Green -- --VP Marketing Mr Jim McKeon -- --Managing Director Global Sales Mr Jeff Martin -- --Vp Operations Coordination Center Mr Vance Toler -- --Director of Corporate Security Mr Michael Van Houweling -- --Director, Online Marketing Ms Julie Weber -- --Senior Director People Mr Robert (Bob) Champagne

-- --Senior Manager

Ms Megan (Meg) Lee -- --Senior Manager Of Community Outreach

Ms Alison (Alli) Schermerhorn

-- --Product Management Intern

Mr Jeffery Hillis -- --Director Technology Ms Cheryl Hughey -- --Director Of Compensation Ms Jennifer (Jen) Paine -- --Information Technology Director Mr Brandon (Bran) Hopper -- --Manager, E Commerce Testing Mr Del Mann -- --Pilot Mr Jeff Mitchell -- --Aesthetic Design Mr Joe (Joey) Paris -- --Ramp Agent Mr Steven (Steve) Stockton -- --Pilot Mr Earl Thompson -- --Operation Agent

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Board Members

Name AgeTitle

Mr. Gary C. Kelly 60Chairman, President, and CEO

Mr. Ron Ricks 66Vice Chairman

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Biographies

Gary C. Kelly, Age 60

Title held since 2008 : Chairman, President, and CEO

Current Company Titles 2008 - 2013 : Chairman, President, and CEO

2008 - 2008 : Chairman and CEO

2004 - 2008 : Vice Chairman and CEO

2001 - 2004 : EVP and CFO

Current Company Compensation History Salary Bonus Total

-- --2015 : --

$675,000.00 $224,775.002014 : $5,002,785.00

$675,000.00 $202,500.002013 : $4,036,167.00

$675,000.00 $961,000.002012 : $4,031,359.00

$648,750.00 $925,000.002011 : $3,516,201.00

$465,000.00 $930,000.002010 : $3,357,570.00

$441,750.00 $590,000.002009 : $1,559,431.00

$441,121.00 $462,000.002008 : $1,680,272.00

$424,065.00 $462,000.002007 : $1,301,438.00

$416,860.00 $462,000.002006 : $1,405,883.00

$404,719.00 $275,000.002005 : --

$322,436.00 $220,000.002004 : --

$256,872.00 $184,450.002003 : --

$243,793.00 $184,450.002002 : --

$213,246.00 $197,000.002001 : --

Biography

Source : Proxy, April 6, 2015

Gary C. Kelly has served as the Companys Chairman of the Board since May 2008, as its President since July 2008, and as its Chief Executive Officer since July 2004. Mr. Kelly also served as the Companys Executive Vice President and as its Chief Financial Officer from June 2001 to July 2004 and Vice President Finance and Chief Financial Officer from 1989 to 2001. Mr. Kelly joined the Company in 1986 as its Controller. During the past five years, Mr. Kelly has served as a Director of one publicly traded company other than Southwest: Lincoln National Corporation (since November 2009). Mr. Kelly recently completed a two year term as Chairman of the Board of Directors for Airlines for America.

Ron Ricks, Age 66

Title held since 2015 : Vice Chairman

Current Company Titles 2015 - Present : Vice Chairman

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2012 - 2015 : EVP and Chief Legal and Regulatory Officer

2008 - 2012 : EVP Corporate Services and Corporate Secretary

2007 - 2008 : EVP Law, Airports, and Public Affairs

2002 - 2006 : SVP, Law, Airports, and Public Affairs

Current Company Compensation History Salary Bonus Total

$468,750.00 --2015 : $3,058,199.00

$457,500.00 $132,480.002014 : $2,441,864.00

$440,000.00 $116,160.002013 : $2,171,120.00

$438,525.00 $528,000.002012 : $2,194,700.00

$420,925.00 $465,000.002011 : $1,872,983.00

$370,000.00 $475,000.002010 : $1,814,896.00

$370,000.00 $375,000.002009 : $1,044,835.00

$346,375.00 $340,000.002008 : $881,341.00

$326,729.00 $340,000.002007 : $864,106.00

$286,986.00 $340,000.002006 : $822,505.00

$249,972.00 $217,800.002005 : --

$225,569.00 $198,000.002004 : --

$210,103.00 $168,300.002003 : --

$202,179.00 $168,300.002002 : --

Biography

Source : 10K, February 6, 2015

Ron Ricks has served as the Companys Executive Vice President & Chief Legal & Regulatory Officer since September 2011. Mr. Ricks also served as Corporate Secretary from May 2008 to January 2013, Executive Vice President Corporate Services from May 2008 to September 2011, Executive Vice President Law, Airports, & Public Affairs from September 2006 to May 2008, and Senior Vice President Law, Airports, & Public Affairs from August 2004 until September 2006. Mr. Ricks joined the Company in 1986 as its Vice President Governmental Affairs.

Michael G. (Mike) Van de Ven, Age 54

Title held since 2008 : EVP and COO

Current Company Titles 2008 - Present : EVP and COO

2005 - 2008 : EVP Aircraft Operations

Current Company Compensation History Salary Bonus Total

$469,375.00 --2015 : $3,053,184.00

$465,000.00 $139,500.002014 : $2,475,970.00

PAGE 10Dec 01, 2016• •866-541-3770 HOOVERS.COM

Salary Bonus Total

$465,000.00 $122,760.002013 : $2,224,248.00

$465,000.00 $530,000.002012 : $2,223,175.00

$452,500.00 $495,000.002011 : $2,118,608.00

$365,000.00 $500,000.002010 : $2,001,015.00

$365,000.00 $375,000.002009 : $1,037,602.00

$340,208.00 $300,000.002008 : $865,758.00

Biography

Source : 10K, February 6, 2015

Michael G. Van de Ven has served as the Companys Executive Vice President & Chief Operating Officer since May 2008. Mr. Van de Ven also served as Chief of Operations from September 2006 to May 2008, Executive Vice President Aircraft Operations from November 2005 through August 2006, Senior Vice President Planning from August 2004 to November 2005, Vice President Financial Planning & Analysis from 2001 to 2004, Senior Director Financial Planning & Analysis from 2000 to 2001, and Director Financial Planning & Analysis from 1997 to 2000. Mr. Van de Ven joined the Company in 1993 as its Director Internal Audit.

Tammy Romo, Age 53

Title held since 2015 : EVP and CFO

Current Company Titles 2015 - Present : EVP and CFO

2012 - 2015 : SVP Finance and CFO

2012 - 2012 : SVP Planning

2008 - 2012 : VP Planning

Current Company Compensation History Salary Bonus Total

$451,250.00 --2015 : $2,139,876.00

$426,250.00 $103,200.002014 : $1,627,993.00

$391,250.00 $85,000.002013 : $1,259,305.00

$326,650.00 $330,000.002012 : $1,007,824.00

Biography

Tammy Romo has served as the Companys Senior Vice President Finance & Chief Financial Officer since September 2012. Ms. Romo also served as Senior Vice President of Planning from February 2010 to September 2012, Vice President of Financial Planning from September 2008 to February 2010, Vice President Controller from February 2006 to August 2008, Vice President Treasurer from September 2004 to February 2006, Senior Director of Investor Relations from March 2002 to September 2004, Director of Investor Relations from December 1994 to March 2002, Manager of Investor Relations from September 1994 to December 1994, and Manager of Financial Reporting from September 1991 to September 1994.

PAGE 11Dec 01, 2016• •866-541-3770 HOOVERS.COM

Source : 10K, February 6, 2015

Craig Maccubbin, Age 49

Title held since 2013 : VP Technology Operations and CTO

Current Company Titles 2013 - Present : VP Technology Operations and CTO

Biography

Source : Company Press Release, April 19, 2013

Maccubbin most recently served as Vice President and CIO of Spirit Airlines, where he was responsible for all information technology and systems. During his career, Maccubbin has held various executive positions in the IT sector across a broad range of industries, including aviation. As Vice President and CTO of Zeta Interactive, a major digital marketing agency, he led product development, infrastructure, professional services, and customer support and delivery for several Fortune 500 Companies, including US Airways, Mattel, JP Morgan Chase, Sony, Time, Inc., and Warner Music Group. He also served as Vice President and CTO for Black Entertainment Television where he successfully led the design and delivery of the world's largest African American vertical portal. Previously, he also established a large consulting practice that was focused on enterprise systems development for a variety of clients including Nationwide Insurance, Verizon, Sprint, Mercedes-Benz and the U.S. Department of Education. As CTO, Maccubbin joins the Technology Leadership team and will oversee approximately 500 Employees engaged in support of the airline's technology agenda. His primary function is to support the day-to-day operational aspects of running technology solutions for all of Southwest Airlines, including operations of the airline's data centers. In addition, he will lead the Quality Assurance function within Technology.

Randy Sloan

Current Company Titles Unknown - Present : SVP and CIO

Robert E. (Bob) Jordan, Age 55

Title held since 2012 : EVP and Chief Commercial Officer; President, AirTran Airways

Current Company Titles 2012 - Present : EVP and Chief Commercial Officer; President, AirTran Airways

2011 - 2012 : EVP Strategy and Planning; President, AirTran Airways

2008 - 2011 : EVP Strategy and Planning

2006 - 2008 : EVP Strategy and Technology

Unknown - 2006 : SVP Enterprise Spend Management

Current Company Compensation History Salary Bonus Total

PAGE 12Dec 01, 2016• •866-541-3770 HOOVERS.COM

Salary Bonus Total

$469,375.00 --2015 : $2,947,877.00

$465,000.00 $123,876.002014 : $2,460,346.00

$465,000.00 $111,600.002013 : $2,213,088.00

$458,525.00 $500,000.002012 : $2,186,700.00

$404,050.00 $450,000.002011 : $1,841,108.00

$340,000.00 $470,000.002010 : $1,780,180.00

$340,000.00 $370,000.002009 : $976,720.00

$311,483.00 $270,000.002008 : $722,044.00

Biography

Source : 10K, February 6, 2015

Robert E. Jordan has served as the Companys Executive Vice President & Chief Commercial Officer since September 2011 and as President of AirTran Airways, Inc. since May 2011. Mr. Jordan also served as Executive Vice President Strategy & Planning from May 2008 to September 2011, Executive Vice President Strategy & Technology from September 2006 to May 2008, Senior Vice President Enterprise Spend Management from August 2004 to September 2006, Vice President Technology from 2002 to 2004, Vice President Purchasing from 2001 to 2002, Controller from 1997 to 2001, Director Revenue Accounting from 1994 to 1997, and Manager Sales Accounting from 1990 to 1994. Mr. Jordan joined the Company in 1988 as a programmer.

Jeff Lamb, Age 53

Title held since 2015 : EVP Corporate Services and Aiport Affairs

Current Company Titles 2015 - Present : EVP Corporate Services and Aiport Affairs

Unknown - 2015 : EVP and Chief People and Administrative Officer

Current Company Compensation History Salary Bonus Total

$448,750.00 --2015 : $2,750,831.00

Biography

Source : 10K, February 6, 2015

Jeff Lamb has served as the Companys Executive Vice President & Chief People & Administrative Officer since September 2011. Mr. Lamb also served as Senior Vice President Administration & Chief People Officer from October 2007 to September 2011, Vice President People & Leadership Development from February 2006 to October 2007, and as Senior Director People Development from December 2004 until February 2006.

PAGE 13Dec 01, 2016• •866-541-3770 HOOVERS.COM

Tom Nealon

Title held since 2016 : EVP Strategy and Innovation

Current Company Titles 2016 - Present : EVP Strategy and Innovation

Ryan Green

Title held since 2016 : VP Marketing

Current Company Titles 2016 - Present : VP Marketing

Unknown - 2016 : Managing Director of Customer Strategy & Development

Biography

Source : Company Press Release, January 26 2016

Ryan Green has served in a number of marketing leadership positions during his 14-year tenure at Southwest. Positions include Director of Loyalty Marketing and Manager of Product Development. In these previous positions, he launched Rapid Rewards A-List the frequent flyer program's tiered status level, led the development and launch of the Southwest® gift card, helped relaunch the Rapid Rewards program in 2011, and laid the groundwork for numerous inflight experience enhancements. He previously directly managed the Southwest Airlines Rapid Rewards credit card program with Chase.

Jim McKeon

Current Company Titles Unknown - Present : Managing Director Global Sales

Jeff Martin

Title held since 2010 : Vp Operations Coordination Center

Current Company Titles 2010 - Present : Vp Operations Coordination Center

Vance Toler

Current Company Titles Unknown - Present : Director of Corporate Security

Michael Van Houweling

Current Company Titles Unknown - Present : Director, Online Marketing

PAGE 14Dec 01, 2016• •866-541-3770 HOOVERS.COM

Julie Weber

Current Company Titles Unknown - Present : Senior Director People

Robert (Bob) Champagne

Current Company Titles Unknown - Present : Senior Manager

Megan (Meg) Lee

Current Company Titles Unknown - Present : Senior Manager Of Community Outreach

Alison (Alli) Schermerhorn

Current Company Titles Unknown - Present : Product Management Intern

Jeffery Hillis

Current Company Titles Unknown - Present : Director Technology

Cheryl Hughey

Current Company Titles Unknown - Present : Director Of Compensation

Jennifer (Jen) Paine

Current Company Titles Unknown - Present : Information Technology Director

Brandon (Bran) Hopper

Current Company Titles Unknown - Present : Manager, E Commerce Testing

Del Mann

Current Company Titles Unknown - Present : Pilot

PAGE 15Dec 01, 2016• •866-541-3770 HOOVERS.COM

Jeff Mitchell

Current Company Titles Unknown - Present : Aesthetic Design

Joe (Joey) Paris

Current Company Titles Unknown - Present : Ramp Agent

Steven (Steve) Stockton

Current Company Titles Unknown - Present : Pilot

Earl Thompson

Current Company Titles Unknown - Present : Operation Agent

PAGE 16Dec 01, 2016• •866-541-3770 HOOVERS.COM

Company Financials

Auditor

$19,820.00M

$2,181.00M

PublicCompany Type

1-Year Sales Growth

Prescreen Score 91.99%1-Year Net Income Growth

6.53%

Low Risk Ernst & Young LLP

Financial Summary

Fiscal Year-End December

NYSE Arca: LUV Headquarters

2015 Sales

2015 Net Income

PAGE 17Dec 01, 2016• •866-541-3770 HOOVERS.COM

Annual Income Statement All amounts in millions of US Dollars except per share amounts.

Dec 2015

Revenue 19,820.00 Cost of Goods Sold 6,025.00 Gross Profit 13,795.00

Gross Profit Margin 69.60% SG&A Expense 6,383.00 Depreciation and Amortization 1,015.00 Operating Income 4,116.00 Operating Margin 20.77% Nonoperating Income -- Nonoperating Expenses -- Income Before Taxes 3,479.00 Income Taxes 1,298.00 Net Income After Taxes 2,181.00

Continuing Operations 2,181.00 Discontinued Operations -- Total Operations 2,181.00 Total Net Income 2,181.00 Net Profit Margin 11.00%

Diluted EPS from Continuing Operations 3.27 Diluted EPS from Total Operations 3.27 Diluted EPS from Total Net Income 3.27 Dividends per Share 0.29

Dec 2014

18,605.00

7,677.00 10,928.00

58.74% 5,434.00

938.00 2,225.00

11.96% --

1,816.00 680.00

1,136.00

1,136.00 --

1,136.00 1,136.00

6.11%

1.64 1.64 1.64

0.22

Dec 2013

17,699.00

8,307.00 9,392.00

53.07% 5,035.00

867.00 1,278.00

7.22% --

1,209.00 455.00 754.00

754.00 --

754.00 754.00 4.26%

1.05 1.05 1.05 0.13

Dec 2012

17,088.00

8,650.00 8,438.00

49.38% 4,749.00

844.00 623.00 3.65% 62.00 62.00

685.00 264.00 421.00

421.00 --

421.00 421.00 2.46%

0.56 0.56 0.56 0.03

Dec 2011

15,658.00

7,866.00 7,792.00

49.76% 4,371.00

715.00 693.00 4.43%

-- --

323.00 145.00 178.00

178.00 --

178.00 178.00 1.14%

0.23 0.23 0.23 0.02

PAGE 18Dec 01, 2016• •866-541-3770 HOOVERS.COM

Quarterly Income Statement All amounts in millions of US Dollars except per share amounts.

Sep 2016Quarter Ending

Revenue 5,139.00 Cost of Goods Sold 1,562.00 Gross Profit 3,577.00

Gross Profit Margin 69.60% SG&A Expense 1,909.00 Depreciation and Amortization 315.00 Operating Income 695.00 Operating Margin 13.52% Nonoperating Income -- Nonoperating Expenses -- Income Before Taxes 618.00 Income Taxes 230.00 Net Income After Taxes 388.00

Continuing Operations 388.00 Discontinued Operations -- Total Operations 388.00 Total Net Income 388.00 Net Profit Margin 7.55%

Diluted EPS from Continuing Operations 0.62 Diluted EPS from Total Operations 0.62 Diluted EPS from Total Net Income 0.62 Dividends per Share 0.10

Jun 2016

5,384.00

1,551.00 3,833.00

71.19% 1,639.00

299.00 1,276.00 23.70%

28.00 28.00

1,304.00 484.00 820.00

820.00 --

820.00 820.00 15.23%

1.28 1.28 1.28 0.10

Mar 2016

4,826.00

1,475.00 3,351.00

69.44% 1,539.00

290.00 944.00 19.56%

-- --

816.00 305.00 511.00

511.00 --

511.00 511.00

10.59%

0.79 0.79 0.79 0.08

Dec 2015

4,977.00

1,412.00 3,565.00

71.63% 1,658.00

264.00 1,026.00 20.61%

--

847.00 311.00

536.00

536.00 --

536.00 536.00 10.77%

0.82 0.82 0.82 0.08

Sep 2015

5,318.00

1,558.00 3,760.00

70.70% 1,699.00

258.00 1,225.00 23.03%

--

933.00 349.00 584.00

584.00 --

584.00 584.00 10.98%

0.88 0.88 0.88 0.08

PAGE 19Dec 01, 2016• •866-541-3770 HOOVERS.COM

Annual Balance Sheet All amounts in millions of US Dollars except per share amounts.

Current Assets

Inventories

Dec 2015

Cash Net Receivables

Total Current Assets

474.00

Net Fixed Assets

188.00

15,601.00

1,583.00

4,024.00

311.00

213.00

Other Current Assets

21,312.00Total Assets

Assets

Other Noncurrent

Preferred Stock Equity Common Stock Equity

--

Dec 2015

808.00

Shares Outstanding (M) 647.60 7,358.00Total Equity

Shareholder's Equity

Long-Term Debt

Accounts Payable

Other Current Liabilities

Dec 2015

1,316.00 Total Liabilities Other Noncurrent

Current Liabilities

2,541.00

637.00

13,954.00

1,188.00

2,990.00 7,406.00

Short-Term Debt

Total Current Liabilities

Liabilities

Dec 2014

365.00

232.00

14,292.00

1,282.00

4,404.00

342.00

136.00 20,200.00

--

Dec 2014

675.59 6,775.00

Dec 2014

1,640.00 2,434.00

258.00

13,425.00

1,203.00

2,897.00 5,923.00

Dec 2013

419.00

250.00

13,389.00

1,355.00

4,456.00

467.00

320.00 19,345.00

--

Dec 2013

700.47 7,336.00

Dec 2013

1,070.00 2,191.00

629.00

12,009.00

1,247.00

2,571.00 5,676.00

Dec 2012

332.00

210.00

12,766.00

1,113.00

4,227.00

469.00

454.00 18,596.00

--

Dec 2012

730.32 6,992.00

Dec 2012

1,187.00 2,883.00

271.00

11,604.00

1,107.00

2,170.00 4,650.00

Dec 2011

299.00

238.00

12,127.00

829.00

4,345.00

401.00

374.00 18,068.00

--

Dec 2011

772.56 6,877.00

Dec 2011

985.00 3,107.00

644.00

11,191.00

1,057.00

1,836.00 4,533.00

PAGE 20Dec 01, 2016• •866-541-3770 HOOVERS.COM

Quarterly Balance Sheet All amounts in millions of US Dollars except per share amounts.

Quarter Ending Current Assets

Inventories

Sep 2016

Cash Net Receivables

Total Current Assets

848.00

Net Fixed Assets

214.00

16,546.00

1,966.00

4,839.00

331.00

225.00

Other Current Assets

23,045.00Total Assets

Assets

Other Noncurrent

Preferred Stock Equity Common Stock Equity

--

Quarter Sep 2016

808.00

Shares Outstanding (M) 615.60 8,047.00Total Equity

Shareholder's Equity

Long-Term Debt

Accounts Payable

Other Current Liabilities

Quarter Ending Sep 2016

1,240.00 Total Liabilities Other Noncurrent

Current Liabilities

2,323.00

972.00

14,998.00

1,021.00

3,831.00 7,816.00

Short-Term Debt

Total Current Liabilities

Liabilities

Jun 2016

524.00

202.00

16,294.00

2,040.00

4,469.00

328.00

235.00 22,447.00

--

Jun 2016

620.23 7,821.00

Jun 2016

1,183.00 2,391.00

963.00

14,626.00

1,247.00

4,019.00 7,833.00

Mar 2016

511.00

192.00

15,964.00

2,388.00

4,574.00

289.00

232.00 22,241.00

--

Mar 2016

668.69 7,496.00

Mar 2016

1,154.00 2,355.00

953.00

14,745.00

1,153.00

4,033.00 8,253.00

Dec 2015

474.00

188.00

15,601.00

1,583.00

4,024.00

311.00

213.00 21,312.00

--

Dec 2015

647.60 7,358.00

Dec 2015

1,316.00 2,541.00

637.00

13,954.00

1,188.00

2,990.00 7,406.00

Sep 2015

465.00

239.00

14,929.00

1,740.00

4,573.00

308.00

178.00 21,159.00

--

Sep 2015

650.36 6,968.00

Sep 2015

1,265.00 2,381.00

287.00

14,191.00

1,235.00

4,054.00 7,084.00

PAGE 21Dec 01, 2016• •866-541-3770 HOOVERS.COM

Annual Cash Flow All amounts in millions of US Dollars except per share amounts.

Dec 2015

Cash and Cash Equivalents at the Beginning of Year

1,282.00

Net Cash Provided in Operating Activities 3,238.00 Net Cash Provided by Investing Activities (1,913.00) Net Cash Provided by Financing Activities (1,024.00) Net Increase/Decrease in Cash and Cash Equivalents

301.00

Cash and Cash Equivalents at the End of Year

1,583.00

Dec 2014

1,355.00

2,902.00 (1,727.00) (1,248.00)

(73.00)

1,282.00

Dec 2013

1,113.00

2,477.00 (1,384.00)

(851.00) 242.00

1,355.00

Dec 2012

829.00

2,064.00 (833.00) (947.00)

284.00

1,113.00

Dec 2011

1,261.00

1,385.00 (1,051.00) (766.00) (432.00)

829.00

PAGE 22Dec 01, 2016• •866-541-3770 HOOVERS.COM

Quarterly Cash Flow All amounts in millions of US Dollars except per share amounts.

Quarter Ending Sep 2016

Cash and Cash Equivalents at the Beginning of Year

2,040.00

Net Cash Provided in Operating Activities 3,584.00 Net Cash Provided by Investing Activities (1,433.00) Net Cash Provided by Financing Activities (1,768.00) Net Increase/Decrease in Cash and Cash Equivalents

383.00

Cash and Cash Equivalents at the End of Year

1,966.00

Jun 2016

2,388.00

2,728.00 (849.00)

(1,422.00) 457.00

2,040.00

Mar 2016

1,583.00

1,616.00 (175.00) (636.00)

805.00

2,388.00

Dec 2015

1,740.00

3,238.00 (1,913.00)

(1,024.00) 301.00

1,583.00

Sep 2015

1,772.00

2,914.00 (967.00)

(1,489.00) 458.00

1,740.00

PAGE 23Dec 01, 2016• •866-541-3770 HOOVERS.COM

Earning Estimates

High Estimate

Average Estimate

Year ago EPS Growth Rate

--

--

--

--

Low Estimate

Consensus Recommendation

Dec 16

Number of Analysts

Current Quarter

-- -- --

--

Dec 16

Next Quarter

-- --

Current Year Next Year

Dec 16 Dec 16

-- -- -- -- -- --

PAGE 24Dec 01, 2016• •866-541-3770 HOOVERS.COM

Financial Market Data Current Information

1,051 Latest Short Interest Ratio

Dividend Yield 0.74% # of Institutional Holders

--

-- Market Cap

6.15

615.60M $29,080.85M

52-Week High $47.24

30.04%

$49.58 10.92

Last Close (30-Sep-2016)

52-Week Low

10.20%

1.29

Price/Cash Flow Ratio

Price/Sales Ratio

Price/Earnings Ratio Price/Book Ratio

Return on Assets

% Owned by Institutions Latest Net Insider Transactions

Long-Term Debt/Equity

Return on Equity

0

0.41 68.84%

2.98 $34.72

Shares Outstanding

60-Month Beta

Dividend Rate 0.40 Current Ratio 0.62

29.63%

12 MonthGrowth 36 Month 60 Month

51.83% --

4.38% 5.23% 6.75% 29.45% 59.95% 74.50%

Revenue Growth EPS Growth Dividend Growth

PAGE 25Dec 01, 2016• •866-541-3770 HOOVERS.COM

Historical Financials

Income Statement

Year Revenue ($ M) Net Income ($ M) Net Profit Margin Employees

Dec 2015 19,820.00 2,181.00 11.00% 49,583

Dec 2014 18,605.00 1,136.00 6.11% 46,278

Dec 2013 17,699.00 754.00 4.26% 44,831

Dec 2012 17,088.00 421.00 2.46% 45,861

Dec 2011 15,658.00 178.00 1.14% 45,392

Dec 2010 12,104.00 459.00 3.79% 34,901

Dec 2009 10,350.00 99.00 0.96% 34,726

Dec 2008 11,023.00 178.00 1.61% 35,499

Dec 2007 9,861.00 645.00 6.54% 34,378

Dec 2006 9,086.00 499.00 5.49% 32,664

2015 Year-End Financials

Debt Ratio 34.53% Return on Equity 30.04% Cash ($ M) 1,583.00 Current Ratio 0.54 Long-Term Debt ($ M) 2,541.00 Shares Outstanding (M) 647.60 Dividend Yield 0.74% Dividend Payout 0.09 Market Cap ($ M) 27,885.73

Stock History Stock Price ($) P/E Per Share ($)

Year FY High FY Low FY Close High Low Earns. Div. Book Value

Dec 2015 49.58 32.36 43.06 15.16 9.90 3.27 0.29 1.25

Dec 2014 42.17 18.84 42.32 25.71 11.49 1.64 0.22 1.20

Dec 2013 18.95 10.24 18.84 18.05 9.75 1.05 0.13 1.15

Dec 2012 10.56 7.88 10.24 18.86 14.07 0.56 0.03 1.11

Dec 2011 13.32 7.35 8.56 57.91 31.96 0.23 0.02 1.05

Dec 2010 14.26 10.63 12.98 23.38 17.43 0.61 0.02 1.08

Dec 2009 11.61 5.01 11.43 89.31 38.54 0.13 0.02 1.09

Dec 2008 16.47 7.28 8.62 68.63 30.33 0.24 0.02 1.09

Dec 2007 16.60 12.23 12.20 19.76 14.56 0.84 0.02 1.10

Dec 2006 18.15 14.62 15.32 29.75 23.97 0.61 0.02 1.03

PAGE 26Dec 01, 2016• •866-541-3770 HOOVERS.COM

Competitors List Gross Revenue Net Profit

Margin Net Operating Cash FlowCompany

$5,598.00M $1,584.00M15.40%Alaska Air

$40,990.00M $6,249.00M14.16%American Airlines Group (Top Competitor)

$40,704.00M $7,927.00M11.92%Delta Air Lines (Top Competitor)

$532.38M --(15.07%)Frontier Airlines

$6,416.00M $1,598.00M11.66%JetBlue (Top Competitor)

$37,864.00M $5,992.00M7.36%United Continental

$931.00M ($327.00M)(22.34%)US Airways

PAGE 27Dec 01, 2016• •866-541-3770 HOOVERS.COM

Competitive Landscape

Annual Sales ($ M) Employees Market Cap ($ M)

Southwest Airlines Co.

$19,820.00M 49,583

$27,885.73M

Companies listed are Top Competitors.

Key Numbers

$26,452.76M

American Airlines Group Inc.

$40,990.00M 118,500

$39,476.56M

DELTA AIR LINES, INC.

$40,704.00M 83,000 16,862

Jetblue Airways Corporation

$6,416.00M

$7,293.30M

Profitability

Gross Profit Margin Pre-Tax Profit Net Profit Margin Return on Equity Return on Assets

Southwest Airlines Co.

70.48% 17.64% 11.09%

30.04% 10.20%

Return on Invested Capital

--

American Airlines Group Inc.

60.69% 10.10% 14.16%

139.04% 11.36%

--

DELTA AIR LINES, INC.

59.98% 18.19% 11.92%

41.40% 9.05%

--

Jetblue Airways Corporation

66.97% 18.91% 11.66%

22.38% 8.45%

--

Industry

38.24% 0.31% 1.63% 1.27%

0.22% 1.03%

Market

39.35% 6.76% 5.68% 5.93% 1.85% 4.96%

Valuation

Price/Sales Ratio Price/Earnings Ratio Price/Book Ratio Price/Cash Flow

Southwest Airlines Co.

1.29 10.92 2.98 6.15

American Airlines Group Inc.

0.54 3.94 4.33 3.14

DELTA AIR LINES, INC.

0.84 6.33 2.32 3.85

Jetblue Airways Corporation

0.85 7.21 1.45 3.44

Industry

0.76 23.16 2.85 8.35

Market

1.67 20.59

1.96 12.60

Operations

Days of Sales Outstanding Inventory Turnover Days Cost of Goods Sold in Inventory Asset Turnover Net Receivables Turnover Flow Effective Tax Rate

Southwest Airlines Co.

15.2

63.6 19.4

0.9 31.0

37.10%

American Airlines Group Inc.

15.5

37.9 24.5

0.8 22.7

(40.16%)

DELTA AIR LINES, INC.

18.4

54.0 16.9

0.8 18.2

34.45%

Jetblue Airways Corporation

8.0

-- --

0.7 44.8

38.31%

Industry

14.8

27.7 9.2

0.8 12.1

24.63%

Market

49.2

9.2 62.0

0.5 7.3

30.68%

PAGE 28Dec 01, 2016• •866-541-3770 HOOVERS.COM

Financial

Current Ratio Quick Ratio Leverage Ratio Total Debt/ Equity Interest Coverage

Southwest Airlines Co.

0.62 --

0.29 0.41

66.80

American Airlines Group Inc.

0.76 --

4.91 5.32 6.12

DELTA AIR LINES, INC.

0.48 --

0.52 0.60 19.27

Jetblue Airways Corporation

0.80 --

0.44 0.56

13.33

Industry

0.85 0.71 1.01

0.46 4.17

Market

1.90 1.31

0.57 0.54 5.92

Per Share Data

Per Share Data Dividend Per Share Cash Flow Per Share Working Capital Per Share Long-Term Debt Per Share Book Value Per Share Total Assets Per Share

Southwest Airlines Co.

$32.89 $0.35 $6.32

($4.84) $3.77

$13.07 $37.44

American Airlines Group Inc.

$76.17 $0.40 $11.66

($6.71) $41.50 $8.46

$98.44

DELTA AIR LINES, INC.

$53.63 $0.61

$10.21 ($10.62)

$8.79 $16.99 $69.19

Jetblue Airways Corporation

$20.34 --

$5.01 ($1.54) $5.29 $11.88

$29.59

Industry

$3.29 $0.23 $0.26

($0.03) $1.78 $1.43 $5.98

Market

$10.52 $0.80 $1.38 $1.78 $6.23 $9.25

$21.90

Growth

12-Month Revenue 12-Month Net Income 12-Month EPS Growth 12-Month Dividend Growth 36-Month Revenue Growth 36-Month Net Income Growth 36-Month EPS Growth 36-Month Dividend Growth

Southwest Airlines Co.

4.38% 22.84% 29.45% 29.63%

5.23% 53.77% 59.95% 51.83%

American Airlines Group Inc.

(3.60%) 15.03% 28.67%

-- 16.50%

135.99% 39.80%

--

DELTA AIR LINES, INC.

(2.85%) 66.76% 73.26% 50.00%

2.09% 31.78% 36.61%

--

Jetblue Airways Corporation

5.05% 33.49% 29.89%

-- 7.71%

84.62% 77.14%

--

Industry

3.13% (5.12%) (4.97%) 69.23%

5.55% 2.19% 2.42%

53.78%

Market

5.67% 7.45% 6.66% 8.79% 4.38% 6.69% 6.03% 8.17%

PAGE 29Dec 01, 2016• •866-541-3770 HOOVERS.COM