Southwest gets boost from tax law; beats Street 4Q forecasts

DALLAS (AP) — Southwest Airlines said Thursday that fourth-quarter profit jumped to $1.89 billion as the recent tax law reduced the company's deferred tax liability and should boost 2018 earnings too.

The nation's fourth-biggest airline also said that travel bookings so far in 2018 appear solid, and it gave a cautiously upbeat forecast of revenue in the first quarter.

The report indicated, however, that Southwest continues to be dogged by rising costs for labor and fuel. Overall, costs are rising nearly twice as fast as revenue.

Strong demand for travel is boosting Southwest and other carriers, although investors worry that the airlines are undercutting their ability to raise fares by adding too many flights and seats.