Southwest said it is evaluating options to enhance its customer experience, "including onboard seating and our cabin."
Southwest has long been the only U.S. carrier that does not assign seats or charge bag fees. It also has one-cabin planes and doesn't have an extra-legroom product.
Deutsche Bank investment analyst Michael Linenberg wrote Thursday that he is encouraged by the carrier's statement that it is evaluating its customer experience.
"We have long made the case that the company's inability to monetize its cabin and participate in various high-margin revenue streams was a drag on relative margin performance," Linenberg wrote.
When Bob Jordan was preparing to take the CEO position in early 2022, he said that Southwest would consider doing seat assignments.
"Could we one day need to take back up the assigned-seating question? I think we may have to do that," Jordan said during a Southwest Business virtual town hall meeting.
Southwest will exit four airports
Southwest also is cutting airports from its network and reducing service in underperforming markets to improve operating margins and overall financial performance.
Southwest Airlines will remove Syracuse, N.Y.; Bellingham, Wash.; Cozumel, Mexico; and Houston Bush Intercontinental from its network.
Also, operations will be reduced in Atlanta and Chicago O'Hare.
Southwest made those announcements as it reported a net loss for the first quarter of $231 million, including an operating loss of $393 million. Plus, Southwest's revenue of $6.33 billion for the quarter came in on the low edge of its projection.
Boeing delivery delays are part of Southwest's troubles. Last month, the airline reduced capacity expectations for the year and planned other cost-cutting steps because of it.
Syracuse, Bellingham, Houston Bush and O'Hare were among 18 airports that Southwest added to its network during the pandemic, when the airline pursued a unique strategy of expanding its footprint even as the airline industry suffered through a massive downturn.
The carrier said Thursday that in exiting or cutting back in those markets, as well as in Cozumel and Atlanta, it is working to optimize its network by moving aircraft out of underperforming markets.
"Achieving our financial goals is an immediate imperative," Southwest said.