"Nope. No one is saying that the catering costs alone exceed the revenue. The fact is that the catering costs are a small part of the total incremental cost of carrying a passenger from ABC to XYZ. The biggest cost is the fuel needed to lift the plane which is about 230lb heavier (average passenger plus average carryon plus average checked baggage). There are also costs for check-in, cleaning, wear and tear on the seats, etc. It all adds up. It's not always better to leave the seat empty rather than take a low fare, but it often is."

I do believe that they will be paying the check in agents and the cleaning crews to be there whether the seat if full or not. Unless of course their business falls off to the point where they need less people to perform these functions.....and that would not be a good thing. Some costs are fixed...others are variable.