Southwest Airlines Co. Investor Booklet – April 2018

Cautionary Statement Regarding Forward-Looking Statements

This booklet contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on, and include statements about, the Company’s estimates, expectations, beliefs, intentions, and strategies for the future, and are not guarantees of future performance. Specific forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and include without limitation statements related to (i) the Company’s financial position, goals, strategies, expectations, opportunities, and outlook, and its projected results of operations, including factors expected to impact the Company’s results of operations; (ii) the Company’s operational goals, strategies, and initiatives; (iii)the Company’s fleet plans and expectations, including with respect to its fleet modernization initiatives, and the Company’s related financial and operational expectations; (iv) the Company’s expectations and goals with respect to returning value to Shareholders; (v) the Company’s plans and expectations with respect to its new reservation system, and the Company’s related multi-faceted financial and operational expectations and opportunities; and (vi) the Company’s Vision. Forward-looking statements involve risks, uncertainties, assumptions, and other factors that are difficult to predict and that could cause actual results to vary materially from those expressed in or indicated by them. Factors include, among others, (i) changes in demand for the Company’s services and other changes in consumer behavior; (ii) the impact of a continually changing business environment, economic conditions, fuel prices, actions of competitors (including, without limitation, pricing, scheduling, capacity, and network decisions and consolidation and alliance activities), governmental actions, and other factors beyond the Company’s control, on the Company’s business decisions, plans, strategies, and results; (iii) the Company’s dependence on third parties, in particular with respect to its fleet and technology plans; (iv) the Company’s ability to timely and effectively implement, transition, and maintain the necessary information technology systems and infrastructure to support its operations and initiatives; (v) the impact of labor matters on the Company’s business decisions, plans, strategies, expectations, and costs; and (vi) other factors, as described in the Company's filings with the Securities and Exchange Commission, including the detailed factors discussed under the heading "Risk Factors" in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017.

Notice Regarding Third Party Content This presentation may contain information obtained from third parties, including ratings from credit ratings agencies such as S&P Global Ratings. Reproduction and distribution of third party content in any form is prohibited except with the prior written permission of the related third party. Third party content providers do not guarantee the accuracy, completeness, timeliness or availability of any information, including ratings, and are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, or for the results obtained from the use of such content. THIRD PARTY CONTENT PROVIDERS GIVE NO EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE. THIRD PARTY CONTENT PROVIDERS SHALL NOT BE LIABLE FOR ANY DIRECT, INDIRECT, INCIDENTAL, EXEMPLARY, COMPENSATORY, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES, COSTS, EXPENSES, LEGAL FEES, OR LOSSES (INCLUDING LOST INCOME OR PROFITS AND OPPORTUNITY COSTS OR LOSSES CAUSED BY NEGLIGENCE) IN CONNECTION WITH ANY USE OF THEIR CONTENT, INCLUDING RATINGS. Credit ratings are statements of opinions and are not statements of fact or recommendations to purchase, hold or sell securities. They do not address the suitability of securities or the suitability of securities for investment purposes, and should not be relied on as investment advice.

2

Competitive differentiators

3

Unmatched profitability record with cost discipline and a strong balance sheet

Outstanding Customer Service and Hospitality that drives brand loyalty and recognition

Low fares and a point-to-point network that support market leadership and non-stop service

The best People and Culture in the industry

Reliable, efficient operations

Unmatched profitability record1

4

Chapter 7

Chapter 11

U.S. Airline Industry Bankruptcies, 2000-2011

2005 2004 & 2002 2003

2002 2001 2001

2008 2004 2003

2011 2008 2008 & 2004

2005 2005 2005

1In the U.S. Airline industry.

Southwest has remained profitable for 45 consecutive years

1These results will be recast primarily due to the retrospective application transition option selected as part of the Company’s adoption of Accounting Standards Update 2014-09, Revenue from Contracts with Customers. See the Company’s Current Report on Form 8-K furnished to the Securities and Exchange Commission on March 20, 2018 for further information. 2Excludes special items. 3ROIC is defined as annual pre-tax return on invested capital, excluding special items. Note: See reconciliation of reported amounts to non-GAAP financial measures.

2017: an outstanding year!

5

1, 2 1, 2

1, 3

1

6

1Excludes special items. 2Net Margin, excluding special items, is calculated as net income, excluding special items, divided by operating revenues, excluding special items. 3These results will be recast primarily due to the retrospective application transition option selected as part of the Company’s adoption of Accounting Standards Update 2014-09, Revenue from Contracts with Customers. See the Company’s Current Report on Form 8-K furnished to the Securities and Exchange Commission on March 20, 2018 for further information. Note: See reconciliation of reported amounts to non-GAAP financial measures.

Our annual profits and margins significantly improved since 2012, largely due to the successful implementation of our strategic initiatives

0%

2%

4%

6%

8%

10%

12%

14%

$-

$500

$1,000

$1,500

$2,000

$2,500

2012 2013 2014 2015 2016 2017

Net incomeNet margin

Net

inco

me

(in m

illio

ns) N

et margin

Y/Y % Change 26.4 93.0 73.5 68.6 0.6 (11.1)

1

2

Significant profit expansion

3 3

Delivering strong returns on investment

7 1ROIC is defined as annual pre-tax return on invested capital, excluding special items. ROIC is for the 12 months ended December 31 in each year shown. 2These results will be recast primarily due to the retrospective application transition option selected as part of the Company’s adoption of Accounting Standards Update 2014-09, Revenue from Contracts with Customers. See the Company’s Current Report on Form 8-K furnished to the Securities and Exchange Commission on March 20, 2018 for further information. Note: See reconciliation of reported amounts to non-GAAP financial measures.

• AirTran integration

• All New Rapid Rewards

• International

• New reservation system

• Fleet modernization/Boeing 737-800

• Network optimization

• Low fuel prices

Drivers of ROIC

Y/Y Pt. Change 0.4 5.9 8.1 11.5 (2.7) (4.1)

ROIC1

7.2%

13.1%

21.2%

32.7%

30.0%

25.9%

0%

5%

10%

15%

20%

25%

30%

35%

2012 2013 2014 2015 2016 20172 2

Low cost advantage

8 8

While the gap to the industry has contracted over the past 10 years, we are committed to preserving a meaningful competitive cost advantage

1Network airlines: Trans World, American, US Airways, Northwest, Delta, Continental, United, America West (post-American merger) 2LCC airlines: JetBlue, Alaska, Virgin America, America West (pre-AA merger), AirTran (pre-Southwest merger), Allegiant, Spirit, Frontier Source: DOT form 41 and T100 data, through December 31, 2017. Estimated unit costs have been stage-length adjusted to Southwest’s average stage-length, represents domestic mainline

-

2.00

4.00

6.00

8.00

10.00

12.00

14.00

16.00

1Q 2000 4Q 2017

SouthwestNetworkLCC

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2

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Fleet modernization has been a significant contributor to our cost control efforts

9

Aircraft by fleet type Year end aircraft on property

Average seats per aircraft Year end average

The increase in the seat gauge of our aircraft drives down unit costs and allows for efficient growth opportunities

694 681 665 704 723 706

2012 2013 2014 2015 2016 2017

717s Classics 700s 800s MAX 8

136

141

145 146 149

152

2012 2013 2014 2015 2016 2017

Reducing fuel consumption and improving efficiency through fleet modernization and other fuel initiatives

10

69.4

71.7

72.7

73.9 74.4

75.2

66

67

68

69

70

71

72

73

74

75

76

2012 2013 2014 2015 2016 2017

In addition to modernizing the fleet:

• Split scimitar winglets • Galley refresh • Fuel and flight planning • New seats • Single engine taxi • Electronic flight bags

Fuel saving initiatives ASMs per gallon

Y/Y % Change 1.5 3.3 1.5 1.6 0.7 1.1

First quarter 2018 results

11

27.1% pre-tax ROIC1

81.5% load factor

$438M net income2

$648M returned to

Shareholders

$102M profitsharing

(0.3)% nonfuel

CASM2,3, y/y

$0.75 earnings per diluted share2

$4.9B operating revenues

1Q Record

20.8% after-tax ROIC1

1Q Record

1ROIC is defined as annual return on invested capital, excluding special items, for the last twelve months. 2excluding special items. 3excluding profitsharing. Note: see reconciliation of reported amounts to non-GAAP financial measures.

Sustaining a strong financial position

12

1Includes off balance sheet aircraft leases. 2In 1Q 2018, $648 million was returned to Shareholders through a combination of $148 million in dividends and $500 million in share repurchases. 3Free cash flow is calculated as operating cash flows less capital expenditures less assets constructed for others, net. See reconciliation of reported amounts to non-GAAP financial measures. 4Includes payments of debt and capital lease obligations. Note: Balance sheet information is as of March 31, 2018. All other information presented is for the three months ended March 31, 2018.

Investment grade rating by

all three agencies

• Cash flow from operations of $1.0 billion

• Capital spending of $409 million

• Free cash flow of $708 million3

• Debt repayments of $82 million4

• $3.2 billion in unrestricted core cash and short-

term investments and $1 billion line of credit fully undrawn and available

• Balance Sheet leverage goal in the low-to-mid 30% range1

Balanced capital deployment

Strong balance sheet

Returned $648 million

to Shareholders in 1Q 20182

Southwest is focused on preserving a strong balance sheet and healthy cash flows and is the only domestic carrier with a decades-long history of consistently returning capital to Shareholders

13 Source: Bloomberg as of April 20, 2018. Moody’s Senior Unsecured rating used (if unavailable, Long Term Corporate Family or Long Term rating used); S&P’s Long Term Issuer rating used; Fitch’s Senior Unsecured rating used (if unavailable, Long-term Issuer rating used). Note: Please see S&P disclaimer language on slide 2.

Industry-leading balance sheet

Non-investment grade Investment grade

S&P/ Fitch B- B B+ BB- BB BB+ BBB- BBB BBB+ A-

Moody’s B3 B2 B1 Ba3 Ba2 Ba1 Baa3 Baa2 Baa1 A3

Future delivery schedule provides significant flexibility and continued fleet modernization opportunities

14 (a) The Company has flexibility to substitute 737 MAX 7 in lieu of 737 MAX 8 firm orders beginning in 2019. (b) Includes eleven 737-800s, one 737-700, and one 737 MAX 8 delivered as of April 25, 2018. Note: Delivery schedule is as of April 25, 2018.

-800Firm

Orders

MAX 7Firm

Orders

MAX 8Firm

Orders

MAX 8Options

Additional-700s

AdditionalMAX 8s Total

2018 26 — 19 — 1 — 46 (b)2019 — 7 20 — — 3 302020 — — 35 — — — 352021 — — 44 — — — 442022 — — 27 14 — — 412023 — 12 22 23 — — 572024 — 11 30 23 — — 642025 — — 40 36 — — 762026 — — — 19 — — 19

26 30 237 (a) 115 1 3 412

The Boeing Company

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5 Free cash flowShare repurchasesDividends

Creating value for Shareholders

15 1Free cash flow is calculated as operating cash flows less capital expenditures less assets constructed for others, net. Note: See reconciliation of reported amounts to non-GAAP financial measures.

2012 2013 2014 2015 2011 2016

From 2011 through first quarter 2018, we returned more than $8.2 billion to Shareholders through share repurchases and dividends, and completed a $500 million ASR in first quarter 2018.

(in b

illio

ns)

2017 1Q18

1

LUV market outperformance

16 Note: This graph compares the cumulative total shareholder return on the Company’s common stock over the five-year period ended December 31, 2017, with the cumulative total return during such period of the Standard and Poor’s 500 Stock Index and the NYSE ARCA Airline Index. The comparison assumes $100 was invested on December 31, 2012, in the Company’s common stock and in each of the foregoing indices and assumes reinvestment of dividends. The stock performance shown on this graph represents historical stock performance and is not necessarily indicative of future stock price performance.

$0

$100

$200

$300

$400

$500

$600

$700

2012 2013 2014 2015 2016 2017

Tota

l Cum

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ive

Ret

urn

(dol

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)

Southwest

NYSE ARCA Airline

S&P 500

Customer Experience builds loyalty

17

“It’s a good experience. I feel a sense of Hospitality that other airlines do not have.”

• 100% seat availability1

• No blackout dates • Points don’t expire2

Rapid Rewards®

Frequent Flyer Program • Live TV • $8 Wi-Fi flat rate per day • Complimentary snacks and beverages

Exceptional Inflight Offerings

1Members are able to redeem their points for every available seat. 2Must have points earning activity during the most recent 24 months.

Consistently loved and recognized brand

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• Ranked #8 in FORTUNE’S list of the World’s Most Admired Companies, the only commercial airline among the Top 10

• Readers’ pick for Best Frequent Flyer Program (U.S.) for Rapid Rewards by SmarterTravel

• Best Loyalty Credit Card, Best Airline Redemption Ability, and Best Customer Service by the Freddie Awards

• Air Forwarders Association’s Domestic Carrier of the Year

• Ranked among the Best Airline Rewards Programs by U.S News & World Report

Awards in 2017

TransfarencySM is a philosophy created by Southwest Airlines in which Customers are treated honestly and fairly, and low fares actually stay low—no unexpected bag fees3, change fees4, or hidden fees

1No Hidden fees determined by having bag and reservation change/cancellation fees per domestic passenger below the industry average, as determined by Bureau of Transportation Statistics for the year ending December 31, 2017. 2Low fares defined by having an average domestic fare below the industry average US domestic fare, as determined by data from the Department of Transportation O&D survey for the year ending December 31, 2017. 3First and second checked pieces of luggage, size and weight limits apply. 4There are never change fees, though fare differences might apply. 5Alaska Airlines data includes Virgin America for the year ending December 31, 2017

No

Hid

den

Fees

1

Low Fares2

5

19

Behind every seat is a story. Behind every story is the reason for Transfarency.

Culture of celebration & appreciation

20

Mission to our Employees

We are committed to provide our Employees a stable work environment with equal opportunity for learning and personal growth. Creativity and innovation are encouraged for improving the effectiveness of Southwest Airlines. Above all, Employees will be provided the same concern, respect, and caring attitude within the organization that they are expected to share externally with every Southwest Customer.

Our network in 1996

21 Source: EDW DOT Traffic December 1996.

1996

TUL

STL

SNA

SMF

SLC

SFO

SEA

SAT

RNO

PVD

PDX

ONT

OMA

OKC

OAK

MDW

MCO

MCI

LITLAX

IND

IAH

GEG

DTW

CRP

CMH

CLE

BWI

BUR

BOI

AUS

AMA

TUS

TPA

SJCSDF

SANPHX

MSY

MAF

LBB

LAS

HRL

HOU

FLL

ELP

DAL

BNA

BHM

ABQ

By 2006…

22 Source: EDW DOT Traffic December 1996, 2006.

1996 2006

SNA

SMF

SLC

SJC

SEA

SAT

RNO

PVD

PHL

PDX

PBI

ONT

OMA

OAK

MHT

MDW

MCO

LAX

ISP

GEG

DTW

DEN

CRP

BWI

BUR

BUFBOI

BDL

ALB

TUS

TUL

TPA

STLSDF

SAN

RSW

RDU

PIT

PHX

ORF

OKC

MSY

MCI

MAF

LIT

LBB

LAS

JAX

JAN

INDIAD

HRL

HOU

FLL

ELP

DAL

CMH

CLE

BNA

BHM

AUS

AMAABQ

… and today

23 Source: EDW DOT Traffic December 2006, Diio schedules December 2017.

2006 2017

HRL

BUF

OAK

SJC

SAT

SFO

PLSHAV

GCM

TUS

LAX

BZE

MKE

MBJ

SLC

SAN

DEN

SJOLIR

AUA

PUJ

CUN

SJU

PVR

ALB

PDX

GRR

SJD

GEG

PVD

ROC MHT

BOS

SEA

MSP

MEX

PWM

24

1During peak travel seasons. 21996 market share based on enplaned passengers; 2006 and 2017 market share based on revenue passengers. 2017 market share data presented herein as measured by the Department of Transportation O&D Survey for the twelve months ended September 30, 2017 based on domestic originating passengers boarded. O&D stands for Origin and Destination. 32006 includes 32 states and the District of Columbia; 2017 includes 40 states, the District of Columbia, and the Commonwealth of Puerto Rico. 4Fleet is as of December 31 for each year shown. 5ROIC is defined as annual pre-tax return on invested capital, excluding special items and is for the twelve months ended December 31 for each year shown. 6These results will be recast primarily due to the retrospective application transition option selected as part of the Company’s adoption of Accounting Standards Update 2014-09, Revenue from Contracts with Customers. See the Company’s Current Report on Form 8-K furnished to the Securities and Exchange Commission on March 20, 2018 for further information. Note: See reconciliation of reported amounts to non-GAAP financial measures.

The expansion of our robust network has driven meaningful results

1996 2006 2017

Daily departures1 >2,100 >3,200 >4,000

Market share2 11% 18% 24%

Number of cities3 49 63 100

Number of states3 24 32 40

Number of countries3 1 1 11

Fleet4 243 481 706

ROIC5 12% 11% 25.9%6

The evolution of our network

25

29% 18% 14%

LA Basin (LAX, LGB, ONT, SNA, BUR)

27% 14% 12%

Orlando (MCO, SFB)

32% 24%

18%

DC/BWI Area (BWI, DCA, IAD)

36% 27%

14%

Denver

Source: Data presented herein as measured by the Department of Transportation O&D Survey for the twelve months ended December 31, 2017 based on domestic originating passengers boarded. O&D stands for Origin and Destination. 1Metro Areas: A geographic area around a city that includes multiple major airports. In some cases, the airports within a metro area may serve separate competitive markets. 2Co-terminal: Airports that share a common city or region; for example Newark, LaGuardia and JFK are considered co-terminals to one another.

• 24% of total domestic market share

• Market leader in 26 of the top 50 U.S. metro areas1

• Serve (offer itineraries for sale) 96 of the top 100 domestic O&D city pairs (including co-terminal airports2)

Market share

LUV OA #1 OA #2

Southwest has a strong market presence in many of the nation’s top metro areas

32% 22%

16%

Bay Area (OAK, SFO, SJC)

37%

11% 10%

Las Vegas

39% 32%

9%

Phoenix (PHX, AZA)

The nation’s largest domestic airline

#2 #1 #1 #1 #3 #3

#11 #10 #10

#5 #5 #5

#7 #7 #6

#6 #6 #7

#13 #12 #12

#10 #9 #8

Focus on Customer Service

26

Southwest has earned the DOT’s best customer satisfaction ranking for 23 of the past 27 years

2015 2016 2017

Source: Air Travel Consumer Reports for each year shown. Rankings based on complaints filed with the Department of Transportation (DOT) per 100,000 passengers enplaned.

Focus on Reliability

27

2.0

2.5

3.0

3.5

2015 2016 201776%

78%

80%

82%

2015 2016 2017

With record passengers in 2017, our strong OTP and a record-low MBR were notable operational achievements

Mishandled Baggage Rate (MBR)

Ontime Performance (OTP)

New reservation system

28

New Reservation

System

• Electronic Miscellaneous Documents (EMDs) for ancillary services

• Interline & codeshare • Foreign currency • Foreign point of sale • New distribution capabilities

• O&D Controls • Improved fare flexibility • Ancillary controls

• IROPS automation & optimization • Mobile enhancements at airport • Standby capability & policy

improvements

• Schedule variation • Increased days of inventory • Redeyes • Improved connection times

29

Purpose Connect People to what’s important in

their lives through friendly, reliable, and low-cost air travel.

Vision To become the world’s most loved,

most flown, and most profitable airline.

Non-GAAP Reconciliation

30

(a) One-time adjustment related to the amendment of the Company's co-branded credit card agreement with Chase Bank USA, N.A. and a resulting change in accounting methodology. (b) Expenses associated with the Company’s acquisition and integration of AirTran Holdings, LLC, the parent company of AirTran Airways, Inc. ("AirTran"). Such expenses were primarily incurred during the acquisition and integration period of the two companies from 2011 through 2015 as a result of the Company’s acquisition of AirTran, which closed on May 2, 2011. The exclusion of these expenses provides investors with a more applicable basis with which to compare results in future periods now that the integration process has been completed. Further, pursuant to the terms of the Company’s ProfitSharing Plan, acquisition and integration costs were excluded from the calculation of profitsharing expense from April 1, 2011, through Dec. 31, 2013. These costs, totaling $385 million, are being amortized on a pro rata basis as a reduction of operating profits, as defined by the ProfitSharing Plan, from 2014 through 2018, in the calculation of profitsharing. In addition, acquisition and integration costs incurred during 2014 and 2015 will reduce operating profits, as defined, in the calculation of profitsharing. (c) Tax amounts for each individual special item are calculated at the Company's effective rate for the applicable period and totaled in this line item. (d) Adjustment related to the Tax Cuts and Jobs Act legislation passed in December 2017, which resulted in a re-measurement of the Company's deferred tax assets and liabilities at the new corporate tax rate. (e) Includes the impact of the AirTran acquisition as of May 2, 2011. (f) These results will be recast primarily due to the retrospective application transition option selected as part of the Company’s adoption of Accounting Standards Update 2014-09, Revenue from Contracts with Customers. See the Company’s Current Report on Form 8-K furnished to the Securities and Exchange Commission on March 20, 2018 for further information.

in millions, except per share amounts2011(e) 2012 2013 2014 2015 2016(f) 2017(f)

Operating revenues, as reported $ 15,658 $ 17,088 $ 17,699 $ 18,605 $ 19,820 $ 20,425 $ 21,171 Deduct: Special revenue adjustment (a) - - - - (172) - - Operating revenues, excluding special items $ 15,658 $ 17,088 $ 17,699 $ 18,605 $ 19,648 $ 20,425 $ 21,171

Net income, as reported 178$ 421$ 754$ 1,136$ 2,181$ 2,244$ 3,488$ Deduct: Special revenue adjustment (a) - - - - (172) - - Add: Contract ratification bonuses - - - 9 334 356 - Add (Deduct): Mark-to-market impact from fuel contracts settling in future periods 21 (221) (103) 251 373 9 69 Add (Deduct): Ineffectiveness from fuel hedges settling in future periods 33 42 11 5 (9) (11) 31 Add (Deduct): Other net impact of fuel contracts settling in the current or a prior period (excluding reclassifications)

35 (10) 87 24 (251) (197) (150)

Add: Acquisition and integration costs (b) 132 183 86 126 39 - - Deduct: Litigation settlement - - - - (37) - - Add: Asset impairment 14 - - - - 21 - Add: Lease termination expense - - - - - 22 33 Add: Aircraft grounding charge - - - - - - 63 Add (Deduct): Net income tax impact of fuel and special items, excluding Tax reform impact (c) (83) 2 (30) (154) (103) (74) (17) Deduct: Tax reform impact (d) - - - - - - (1,410) Net income, excluding special items 330$ 417$ 805$ 1,397$ 2,355$ 2,370$ 2,107$

Net cash provided by operating activities 1,356$ 2,064$ 2,477$ 2,902$ 3,238$ 4,293$ 3,929$ Deduct: Capital expenditures (968) (1,348) (1,433) (1,748) (2,041) (2,038) (2,123) Deduct: Assets constructed for others - - (14) (80) (102) (109) (126) Add: Reimbursement for assets constructed for others - - - 27 24 107 126 Free cash flow 388$ 716$ 1,030$ 1,101$ 1,119$ 2,253$ 1,806$

Net income per share, diluted, as reported 5.79$ Deduct: Impact from fuel contracts (0.08) Add: Impact of special items 0.16 Deduct: Net income tax impact of fuel and special items, excluding Tax reform impact (c) (0.03) Deduct: Tax reform impact (d) (2.34) Net income per share, diluted, excluding special items 3.50$

Year ended December 31,

Non-GAAP Reconciliation (continued)

31

(a) One-time adjustment related to the amendment of the Company's co-branded credit card agreement with Chase Bank USA, N.A. and a resulting change in accounting methodology. (b) Expenses associated with the Company’s acquisition and integration of AirTran Holdings, LLC, the parent company of AirTran Airways, Inc. ("AirTran"). Such expenses were primarily incurred during the acquisition and integration period of the two companies from 2011 through 2015 as a result of the Company’s acquisition of AirTran, which closed on May 2, 2011. The exclusion of these expenses provides investors with a more applicable basis with which to compare results in future periods now that the integration process has been completed. Further, pursuant to the terms of the Company’s ProfitSharing Plan, acquisition and integration costs were excluded from the calculation of profitsharing expense from April 1, 2011, through Dec. 31, 2013. These costs, totaling $385 million, are being amortized on a pro rata basis as a reduction of operating profits, as defined by the ProfitSharing Plan, from 2014 through 2018, in the calculation of profitsharing. In addition, acquisition and integration costs incurred during 2014 and 2015 will reduce operating profits, as defined, in the calculation of profitsharing. (c) Net adjustment related to presumption that all aircraft in fleet are owned (i.e., the impact of eliminating aircraft rent expense and replacing with estimated depreciation expense for those same aircraft). The Company makes this adjustment to enhance comparability to other entities that have different capital structures by utilizing alternative financing decisions. (d) The Adjustment for fuel hedge accounting in the numerator is due to the Company's accounting policy decision to classify fuel hedge accounting premiums below the Operating income line, and thus is adjusting Operating income to reflect such policy decision. The Equity adjustment for hedge accounting in the denominator adjusts for the cumulative impacts, in Accumulated other comprehensive income and Retained earnings, of gains and/or losses associated with hedge accounting related to fuel hedge derivatives that will settle in future periods. The current period impact of these gains and/or losses are reflected in the Net impact from fuel contracts in the numerator. (e) Calculated as an average of the five most recent quarter end balances or remaining obligations. The Net present value of aircraft operating leases represents the assumption that all aircraft in the Company's fleet are owned, as it reflects the remaining contractual commitments discounted at its estimated incremental borrowing rate as of the time each individual lease was signed. (f) Includes the impact of the AirTran acquisition as of May 2, 2011. (g) These results will be recast primarily due to the retrospective application transition option selected as part of the Company’s adoption of Accounting Standards Update 2014-09, Revenue from Contracts with Customers. See the Company’s Current Report on Form 8-K furnished to the Securities and Exchange Commission on March 20, 2018 for further information. (h) As the twelve month rolling tax rate no longer approximates an annual tax rate due to the significant impact of the Tax Cuts and Jobs Act legislation enacted in December 2017 had on corporate tax rates, the Company is utilizing the first quarter tax rate for 2018 ROIC, after-tax. The first quarter 2018 GAAP tax rate was 23.1 percent, and the Non-GAAP tax rate for the period was also 23.1 percent. See Note Regarding Use of Non-GAAP Financial Measures for additional information. For full year 2018, the Company continues to estimate its effective tax rate to be in the 23 to 23.5 percent range.

in millions1996 2006 2011(f) 2012 2013 2014 2015 2016(g) 2017(g)

Operating income, as reported 351$ 934$ 693$ 623$ 1,278$ 2,225$ 4,116$ 3,760$ 3,515$ Special revenue adjustment (a) - - - - - - (172) - - Contract ratification bonuses - - - - - 9 334 356 - Net impact from fuel contracts - 41 - 32 84 28 (323) (202) (156) Acquisition and integration costs (b) - - 132 183 86 126 39 - - Litigation settlement - - - - - - (37) - - Asset impairment - - 14 - - - - 21 - Lease termination expense - - - - - - - 22 33 Aircraft grounding charge - - - - - 63 Operating income, non-GAAP 351$ 975$ 839$ 838$ 1,448$ 2,388$ 3,957$ 3,957$ 3,455$ Net adjustment for aircraft leases (c) 84 72 129 117 143 133 114 111 109 Adjustment for fuel hedge accounting (d) - (52) (107) (36) (60) (62) (124) (152) (135) Adjusted Operating income, non-GAAP (A) 435 995 861 919 1,531 2,459 3,947 3,916 3,429

Debt, including capital leases (e) 668 1,864 3,780 3,343 2,954 2,763 2,782 3,304 3,259 Equity (e) 1,538 6,693 6,678 6,961 7,017 7,249 7,032 7,833 8,881 Net present value of aircraft operating leases (e) 1,468 1,110 1,981 2,276 1,693 1,458 1,223 1,015 785 Average invested capital 3,674$ 9,667$ 12,439$ 12,580$ 11,664$ 11,470$ 11,037$ 12,152$ 12,925$ Equity adjustment for hedge accounting (d) - (897) 184 145 50 104 1,027 886 296 Adjusted average invested capital (B) 3,674 8,770 12,623 12,725 11,714 11,574 12,064 13,038 13,221

ROIC, pre-tax (A) / (B) 11.8% 11.3% 6.8% 7.2% 13.1% 21.2% 32.7% 30.0% 25.9%

Twelve months ended December 31,2018

Operating income, as reported $ 3,417 Contract ratification bonuses - Net impact from fuel contracts (125)Asset impairment - Lease termination expense 28 Aircraft grounding charge 63 Gain on sale of grounded aircraft (25)Operating income, non-GAAP $ 3,358 Net adjustment for aircraft leases(c) 107 Adjusted Operating income, non-GAAP (A) 3,465$

Non-GAAP tax rate (B) 23.1% (h)

Net operating profit after-tax, NOPAT (A* (1-B) = C) 2,665$

Debt, including capital leases (e) 3,300 Equity (e) 8,561 Net present value of aircraft operating leases (e) 732 Average invested capital 12,593$ Equity adjustment for hedge accounting (d) 196 Adjusted average invested capital (D) 12,789$

Non-GAAP ROIC, pre-tax (A/D) 27.1%

Non-GAAP ROIC, after-tax (C/D) 20.8%

Twelve months ended March 31,

Non-GAAP Reconciliation (continued)

32 (a) Tax amounts for each individual special item are calculated at the Company's effective rate for the applicable period and totaled in this line item.

Three months ended March 31,

2018

Fuel and oil expense, unhedged 1,014$ Add: Premium cost of fuel contracts 34

Deduct: Fuel hedge gains included in Fuel and oil expense, net (30)

Fuel and oil expense, as reported 1,018$ Add: Net impact from fuel contracts 7

Fuel and oil expense, excluding special items (economic) 1,025$

Total operating expenses, as reported 4,328$ Add: Net impact from fuel contracts 7 Add: Gain on sale of grounded aircraft 25

Total operating expenses, excluding special items 4,360$

Deduct: Fuel and oil expense, excluding special items (economic)

(1,025)

Operating expenses, excluding Fuel and oil expense and special items 3,335$

Deduct: Profitsharing expense (102) Operating expenses, excluding profitsharing, Fuel and oil expense and special items 3,233$

Net cash provided by operating activities 1,002$ Capital expenditures (409) Assets constructed for others (24) Reimbursement for assets constructed for others 139 Free cash flow 708$

Net income, as reported 463$ Deduct: Net impact from fuel contracts (7) Deduct: Gain on sale of grounded aircraft (25) Add: Net income tax impact of fuel and special items (a) 7 Net income, excluding special items 438$

Net income per share, diluted, as reported 0.79$

Deduct: Impact from fuel contracts (0.01) Deduct: Impact of special items (0.04) Add: Net income tax impact of fuel and special items (a) 0.01 Net income per share, diluted, excluding special items 0.75$

Three months ended March 31,

2017as recast

Fuel and oil expense, unhedged 816$ Add: Premium cost of fuel contracts 34 Add: Fuel hedge losses included in Fuel and oil expense, net 106 Fuel and oil expense, as recast 956$ Add (Deduct): Net impact from fuel contracts 37 Fuel and oil expense, as recast, excluding special items (economic) 993$

Total operating expenses, as recast 4,248$ Add (Deduct): Net impact from fuel contracts 37 Deduct: Lease termination expense (5) Total operating expenses, as recast, excluding special items 4,280$ Deduct: Fuel and oil expense, as recast, excluding special items (economic) (993)

Operating expenses, as recast, excluding Fuel and oil expense and special items 3,287$

Deduct: Profitsharing expense (99) Operating expenses, as recast, excluding profithsaring, Fuel and oil expense, and special items 3,188$

April 2018