Southwest Airlines Co. filed a free writing prospectus on October 26, 2026, disclosing the pricing terms for a two-tranche senior notes offering totaling $1.25 billion, with settlement set for November 2, 2026.

Key Highlights

  • Two tranches priced: $600,000,000 of 5.750% Notes due November 15, 2029, and $650,000,000 of 6.000% Notes due November 15, 2031.
  • Prices to public: The 2029 Notes priced at 99.936% of principal; the 2031 Notes priced at 99.710% of principal, each plus accrued interest from November 2, 2026.
  • Yields to maturity: 5.772% for the 2029 Notes and 6.067% for the 2031 Notes, according to the filing.
  • Treasury spreads: The 2029 Notes priced at +100 basis points over the 4.875% UST due October 15, 2029; the 2031 Notes at +125 basis points over the 5.000% UST due September 30, 2031.
  • Expected ratings: The filing lists expected ratings of Baa2 (Moody's), BBB (S&P), and BBB+ (Fitch), with the notation that ratings are not recommendations to buy, sell, or hold.
  • Change of control provision: If a change of control triggering event occurs, the issuer will be required to offer to repurchase the applicable notes at 101% of principal plus accrued interest.
  • Settlement: T+5, on November 2, 2026, with interest payments semi-annually on May 15 and November 15 each year, beginning May 15, 2027.

Southwest Airlines' $1.25 Billion Dual-Tranche Debt Pricing Terms

According to the free writing prospectus filed under Rule 433 (Registration No. 333-276909), Southwest Airlines Co. priced two series of senior notes on October 26, 2026. The first tranche consists of $600,000,000 aggregate principal of 5.750% Notes maturing November 15, 2029, carrying CUSIP 844741 BN7 / ISIN US844741BN72. The second tranche consists of $650,000,000 aggregate principal of 6.000% Notes maturing November 15, 2031, carrying CUSIP 844741 BP2 / ISIN US844741BP21. Both series will pay interest semi-annually on May 15 and November 15, using a 30/360 day count convention.

The filing discloses that the 2029 Notes were priced at a spread of +100 basis points over the benchmark 4.875% U.S. Treasury due October 15, 2029, which was quoted at a price of 100-09 and a yield of 4.772%. The 2031 Notes were priced at +125 basis points over the 5.000% U.S. Treasury due September 30, 2031, quoted at 100-25 1/4 and a yield of 4.817%. The term sheet states that this communication supplements and, where inconsistent, supersedes the preliminary prospectus supplement.

Redemption provisions disclosed in the filing include a make-whole call option prior to October 15, 2029 (for the 2029 Notes) and October 15, 2031 (for the 2031 Notes), calculated using the Treasury Rate plus 15 basis points for the 2029 Notes and 20 basis points for the 2031 Notes. On or after those Par Call Dates, the issuer may redeem either series at 100% of principal plus accrued interest. The joint book-running managers listed include Barclays Capital Inc., BNP Paribas Securities Corp., Standard Chartered Bank, U.S. Bancorp Investments Inc., Wells Fargo Securities LLC, BofA Securities Inc., Citigroup Global Markets Inc., Goldman Sachs and Co. LLC, J.P. Morgan Securities LLC, Morgan Stanley and Co. LLC, and PNC Capital Markets LLC.

What Was Disclosed

Southwest Airlines Co. disclosed the full pricing terms for a $1.25 billion two-tranche note offering dated October 26, 2026, covering coupon rates, prices to public, yields, Treasury spreads, redemption terms, CUSIP identifiers, and the expected credit ratings for each series.