Southwest Airlines has spent the past year undergoing a major transformation, adding bag fees, assigned seating, and extra legroom seats while fares have climbed. On top of that, jet fuel prices have spiked, which would usually spell trouble for any airline. But according to the company’s CEO, flyers haven’t been scared off.

Southwest CEO Bob Jordan said the carrier still grew its profit margins in the third quarter, thanks to steady demand despite higher prices. And he expects that trend to keep going, even with fuel costs staying high.

Fuel Costs Soar

In its Oct. 22 earnings call, Southwest Airlines revealed that higher fuel prices cost the airline $820 million more in the third quarter than in the same period a year ago. The good news, however, is that Southwest was able to make up for it in revenue.

Southwest posted record third-quarter revenue of $8.4 billion, and its adjusted operating margin rose 4.8 points to 5.4%.…