American Airlines and Southwest Airlines both posted second-quarter profits on Thursday thanks to generous federal pandemic relief that covers most of their labor costs.

The reports on Thursday underscored the progress that airlines are making in rebuilding after the coronavirus crushed air travel — and how much farther they must go to fully recover.

American eked out a second-quarter profit of $19 million due to nearly $1.5 billion in taxpayer support. Southwest reported a profit of $348 million, including $724 million in federal help.

Southwest said it made money in June even without the government aid. CEO Gary Kelly said the recent quarter “marked an important milestone in the pandemic recovery as leisure travel demand surged.” He added that Southwest hopes to be profitable by any measure in the third and fourth quarters if the pandemic doesn’t get worse.

Both carriers reported revenue far above 2020 levels. That reflects the rising number of people taking flights in the U.S. — now about 2 million a day, or about 80% of pre-pandemic levels. Domestic leisure travel is roughly back to normal, but business and international travelers are still mostly absent.

As passengers stream back, airlines are adding flights. The airlines persuaded thousands of employees to quit or take long-term leaves of absence last year to avoid financial ruin. Now they are scrambling to hire workers as labor shortages contribute to massive flight delays and cancellations.

The problems have been greatest at Southwest and American, which have struggled with hundreds of delayed flights a day. The carriers blame summer thunderstorms, but Southwest’s Kelly conceded that the sudden increase in passenger traffic has affected operations.

Southwest is recalling some workers from leaves earlier than scheduled. American recently announced plans to bulk up staffing by recalling 3,300 flight attendants from leave later this year and hiring 800 more by next spring. It plans to hire 350 pilots this year and more than 1,000 next year.

Excluding federal funds and other special items, American reported a second-quarter adjusted loss of $1.1 billion. That is American’s smallest adjusted loss in any quarter since 2019, and at $1.69 per share it was less than the $2.03 per share loss forecast by analysts, according to a FactSet survey.

Fort Worth, Texas-based American’s revenue jumped more than four-fold from a year ago but was down 37% from the same quarter in 2019.

Southwest’s profit reversed a loss of $915 million in the second quarter of 2020. Excluding federal relief and other special items, the Dallas-based airline said it would have lost $206 million or 35 cents per share — more than analysts’ prediction of a loss of 21 cents per share.

Southwest said it hopes to be profitable in the third and fourth quarters even excluding federal pandemic aid but cautioned that the pandemic could upset current booking trends. Airline stocks have gyrated recently on concern that COVID-19 variants and rising infection cases could hinder travel.

Revenue quadrupled from a year ago to $4.01 billion but remained 32% lower than the same quarter in 2019.

Alaska Airlines, the nation’s fifth-largest carrier, said it earned $397 million in the second quarter. Excluding $503 million in federal aid and other items, Alaska lost $38 million, or 30 cents per share, on revenue of $1.53 billion.

In afternoon trading, shares of Southwest Airlines Co. were down 3.2% while American Airlines Group Inc. dipped 1.4% and Alaska Air Group Inc. bucked the trend and rose 1.4%.

(AP)