The airline introduced the fee last week, matching those implemented by rivals this year as carriers attempt to offset skyrocketing fuel bills. Continental said in a government filing that the $100 million would be generated through the new revenue as well as cost savings, such as savings associated with not having to check as many bags.
Continental's shares rose 95 cents, or nearly 6 percent, to $17.02 in morning New York Stock Exchange trading.
Continental, which plans to trim its domestic mainline capacity 11 percent in the fourth quarter, said it expects its domestic mainline capacity to be down 2.9 percent in the third quarter.
The airline said it is comfortable with its forward bookings over the next six weeks. Consolidated domestic bookings for the coming six weeks were about 2 percentage points higher than last year, Continental said.
The airline said it has hedged about 53 percent of its expected consolidated fuel needs for the third quarter.
The company expects to end the third quarter with about $2.8 billion in cash and short-term investments.
(Reporting by Kyle Peterson, editing by Maureen Bavdek)