JETBLUE AIRWAYS CORP

Previous wording

•First quarter 2024 system capacity decreased by 2.7% compared to the first quarter of 2023.

Current wording

•Second quarter 2024 system capacity decreased by 2.7% compared to the second quarter of 2023.

Previous wording

•Revenue for the first quarter of 2024 decreased by $119 million year-over-year to $2.2 billion, a 5.1% decrease compared to the first quarter of 2023.

Current wording

•Operating Revenue for the second quarter of 2024 decreased by $182 million year-over-year to $2.4 billion, a 6.9% decrease compared to the second quarter of 2023.

Previous wording

•Operating expense, excluding special items for the first quarter of 2024 decreased 3.7%(1)year-over-year.

Current wording

•Operating expense, excluding special items, for the second quarter of 2024 increased 0.9%(1)year-over-year.

Previous wording

•Operating expense per available seat mile ("CASM") for thefirst quarter of 2024 increased by 17.1% year-over-year to 17.95 cents compared to thefirst quarter of 2023.

Current wording

•Operating expense per available seat mile ("CASM") for thesecond quarter of 2024 increased by 2.6% year-over-year to 14.04 cents compared to thesecond quarter of 2023.

Previous wording

•Our operating expense for thefirst quarter of 2024 and 2023 included the effects of special items. Excluding aircraft fuel, special items, and operating expenses related to our non-airline businesses, our operating expense(1) increased by 4.2% to $1.7 billion year-over-year.

Current wording

•Our operating expense for thesecond quarter of 2024 and 2023 included the effects of special items. Excluding aircraft fuel, special items, and operating expenses related to our non-airline businesses, our operating expense(1) was $1.7 billion, an increase of 1.0% year-over-year.

Previous wording

•Excluding fuel, special items, and operating expenses related to our non-airline businesses, our cost per available seat mile ("CASM ex-fuel")(1) increased by 7.1% to 10.57 cents in thefirst quarter of 2024 compared to the first quarter of 2023.

Current wording

•Excluding fuel, special items, and operating expenses related to our non-airline businesses, our cost per available seat mile ("CASM ex-fuel")(1) increased by 3.7% to 10.24 cents in thesecond quarter of 2024 compared to the second quarter of 2023.

Previous wording

•For the first quarter of 2024 and 2023, our reported loss per share was $2.11 and $0.58, respectively. Excluding special items, our adjusted loss per share(1) for the first quarter of 2024 and 2023 was $0.43 and $0.34, respectively.

Current wording

•For the second quarter of 2024 and 2023, our reported earnings per share was $0.07 and $0.41, respectively. Excluding special items, our adjusted earnings per share(1) for the second quarter of 2024 and 2023 was $0.08 and $0.45, respectively.

Previous wording

In July 2023, Pratt & Whitney, a division of Raytheon Technologies, announced the requirement, mandated by the Federal Aviation Administration ("FAA"), for removal of certain engines for inspection due to contaminated powdered metal used in high-pressure turbine disks on the V2500, PW1100G, and PW1500G engine types. These engines power our Airbus A320, Airbus A220 and Airbus A321neo fleets. The contaminated powdered metal affects engines manufactured between October 2015 and September 2021. Engines are now required to be inspected after they have reached a reduced number of cycles dependent on the fleet type. As of March 31, 2024, we had nine aircraft grounded for required inspection. The Company currently expects each removed engine to take up to 360 days to complete a shop visit and return to a serviceable condition and expects an average of 11 aircraft out of service throughout the year.

Current wording

In July 2023, Pratt & Whitney, a division of Raytheon Technologies, announced the requirement, mandated by the Federal Aviation Administration ("FAA"), for removal of certain engines for inspection due to a rare condition in powdered metal used to manufacture certain engine parts on the PW1100G and PW1500G engine types. These engines power our Airbus A220 and Airbus A321neo fleets. The rare condition powdered metal affects engines manufactured between October 2015 and September 2021. Engines are now required to be inspected after they have reached a reduced number of cycles dependent on the fleet type. As a result of these required inspections and other engine reliability deficiencies, as of June 30, 2024, we had 10 aircraft grounded due to lack of engine availability. The Company currently expects each removed engine to take up to 360 days to complete a shop visit and return to a serviceable condition. The Company has had an average of 11 aircraft grounded through June 30, 2024 and we expect this to remain consistent for the balance of the year. We currently expect aircraft out of service in 2025 to be in the mid-to-high teens.

Previous wording

In 2023, we reached a confidential settlement agreement with Pratt & Whitney, which was intended to address damages incurred by us in 2023 due to the grounding of the affected engines. Into 2024 and beyond, we expect to have a certain number of engines grounded and, therefore, will continue to assess the resulting impact on our future capacity plans. We are currently working with Pratt & Whitney on compensation arrangements.

Current wording

Given that we expect to have a certain number of aircraft groundings into 2024 and beyond, we will continue to assess the resulting impact on our future capacity plans. We are currently working with Pratt & Whitney on compensation arrangements.

Previous wording

While we are working with Pratt & Whitney to secure additional compensation, the full impact of the removal and any potential remediation steps remains uncertain. The engine groundings, including but not limited to a reduction in capacity, could adversely impact our operations and financial results.

Current wording

While we are working with Pratt & Whitney to secure compensation for 2024, the full impact of the removal and any potential remediation steps remains uncertain. The effect of aircraft groundings due to lack of engine availability, including but not limited to a reduction in capacity, could adversely impact our operations and financial results.

Previous wording

We reported a net loss of$716 million, operating loss of$719 million and an operating margin of(32.6)% for the three months ended March 31, 2024. This compares to net loss of $192 million, an operating loss of $242 million and an operating margin of (10.4)% for the three months ended March 31, 2023. Our loss per share was$2.11 for the first quarter of 2024 compared to a loss per share of $0.58 for the same period in 2023. Net loss increased $524 million year-over-year primarily due to the write off of Spirit-related costs as a result of the termination of the Merger Agreement discussed in Note 12 to our condensed consolidated financial statements included in Part I, Item 1 of this Report.

Current wording

We reported net income of$25 million, operating income of$57 million and an operating margin of 2.3% for the three months ended June 30, 2024. This compares to net income of $138 million, an operating income of $235 million and an operating margin of 9.0% for the three months ended June 30, 2023. Our earnings per share was$0.07 for the second quarter of 2024 compared to a earnings per share of $0.41 for the same period in 2023. Net income decreased $113 million year-over-year primarily due to lower revenue driven by lower capacity.

Previous wording

Our reported results for the three months ended March 31, 2024 included the effects of special items. Adjusting for these one-time items, our adjusted net loss(1) was $145 million, adjusted operating loss(1) was $157 million, adjusted operating margin(1) was (7.1)%, and adjusted loss per share(1) was $0.43 for the three months ended March 31, 2024.

Current wording

Our reported results for the three months ended June 30, 2024 included the effects of special items. Adjusting for these one-time items, our adjusted net income(1) was $26 million, adjusted operating income(1) was $58 million, adjusted operating margin(1) was 2.4%, and adjusted earnings per share(1) was $0.08 for the three months ended June 30, 2024.

Previous wording

Our reported results for the three months ended March 31, 2023 included the effects of special items. Adjusting for these one-time items, our adjusted net loss(1)was $111 million, adjusted operating loss(1) was $130 million, adjusted operating margin(1)was (5.6)%, and adjusted loss per share(1)was $0.34 for the three months ended March 31, 2023.

Current wording

Our reported results for the three months ended June 30, 2023 included the effects of special items. Adjusting for these one-time items, our adjusted net income(1)was $152 million, adjusted operating income(1) was $259 million, adjusted operating margin(1)was 9.9%, and adjusted earnings per share(1)was $0.45 for the three months ended June 30, 2023.

Previous wording

On-time performance, as defined by the DOT, is arrival within 14 minutes of scheduled arrival time. In the first quarter of 2024, our systemwide on-time performance was 70.9% compared to 70.4% for the same period in 2023. Our completion factor decreased to 98.7% in the first quarter of 2024 from 98.8% in the same period in 2023.

Current wording

On-time performance, as defined by the DOT, is arrival within 14 minutes of scheduled arrival time. In the second quarter of 2024, our systemwide on-time performance was 74.8% compared to 67.4% for the same period in 2023. Our completion factor increased to 98.8% in the second quarter of 2024 from 97.8% in the same period in 2023.

Previous wording

Passenger revenue is our primary source of revenue, which includes seat revenue and baggage fees, as well as revenue from our ancillary product offerings such as Even More® Space. The decrease in passenger revenue of$127 million, or 5.8%, for the three months ended March 31, 2024, compared to the same period in 2023, was due to both a 6.0% decrease in revenue passengers and a 3.1% decrease in yield per passenger mile.

Current wording

Passenger revenue is our primary source of revenue, which includes seat revenue and baggage fees, as well as revenue from our ancillary product offerings such as Even More® Space. The decrease in passenger revenue of$195 million, or 7.9%, for the three months ended June 30, 2024, compared to the same period in 2023, was due to both a 7.4% decrease in revenue passengers and a 4.0% decrease in yield per passenger mile.

Previous wording

Other revenue is primarily comprised of the marketing component of the sales of our TrueBlue® points. It also includes revenue from the sale of vacation packages, airport concessions and advertising revenue.

Current wording

Other revenue is primarily comprised of the marketing component of the sales of our TrueBlue® points. It also includes revenue from the sale of vacation packages, airport concessions and advertising revenue. The year-over-year increase in other revenue of$13 million, or 9.1%, was principally driven by an increase in TrueBlue® marketing revenue due to higher customer spend as well as an increase in vacation bookings.

Previous wording

Aircraft rent decreased $5 million, or 16.1%, in the three months ended March 31, 2024 compared to the same period in 2023, primarily due to fewer leases for Airbus A320 aircraft and Embraer E190 aircraft.

Current wording

Aircraft rent decreased $9 million, or 25.2%, in the three months ended June 30, 2024 compared to the same period in 2023, as a result of fewer leases for the Airbus A320 aircraft and Embraer E190 aircraft. The Company purchased certain A320 aircraft off lease and certain Embraer E190 aircraft leases reached their lease expiration and were subject to return to the lessor as part of the Company's fleet transition plan.

Previous wording

Aircraft fuel decreased by$160 million, or 20.4%, for the three months ended March 31, 2024 compared to the same period in 2023. Over the same period, the average fuel price decreased by 17.3% to $2.97 per gallon and fuel consumption decreased by 3.8%, or 9 million gallons.

Current wording

Aircraft fuel decreased by $155 million, or 11.0%, for the six months ended June 30, 2024 compared to the same period in 2023. The average fuel price for the six months ended June 30, 2024 decreased by 7.3% to $2.92 per gallon and fuel consumption decreased by 4.0%, or 17 million gallons.

Previous wording

Salaries, wages and benefits increased $82 million, or 11.0%, for the three months ended March 31, 2024 compared to the same period in 2023 driven by wage rate increases. The wage rate increase was primarily due to the new pilot union contract effective March 1, 2023, which included an initial pay rate increase of 14% and an additional 3% pay rate increase effective August 2023.

Current wording

Salaries, wages and benefits increased by $93 million, or 6.2%, for the six months ended June 30, 2024 compared to the same period in 2023, driven primarily by wage rate increases. The wage rate increases were primarily due to the new pilot union contract effective March 1, 2023, which included an initial pay rate increase of 14% and an additional 3% pay rate increase in August 2023.

Previous wording

For the three months ended March 31, 2024, special items included the following:

Current wording

For the six months ended June 30, 2024, special items included the following:

Previous wording

•$15 million relating to voluntary opt-out costs; and

Current wording

•$16 million relating to voluntary opt-out costs; and

Previous wording

For the three months ended March 31, 2023, special items included the following:

Current wording

For the six months ended June 30, 2023, special items included the following:

Previous wording

The following table sets forth our operating statistics for the three months ended March 31, 2024 and 2023:

Current wording

The following table sets forth our operating statistics for the three and six months ended June 30, 2024 and 2023:

Previous wording

We expect our operating results to significantly fluctuate from quarter-to-quarter in the future as a result of various factors, many of which are outside of our control. For example, air traffic controller shortages in the Northeast and Florida continue to cause disruptions in the industry, resulting in the FAA waiving the minimum usage requirement and permitting us to voluntarily turn in up to 10% of our slots in the New York area to help protect our operations. Even with the flight cutbacks, we experienced and continue to expect challenges in the operating environment. Consequently, we believe quarter-to-quarter comparisons of our operating results may not necessarily be meaningful; you should not rely on our results for any one quarter as an indication of our future performance. Except for uncertainty related to the cost of aircraft fuel, we expect our expenses to continue to increase as we acquire additional aircraft, as our fleet ages, and as we expand the frequency of flights in existing markets as well as enter into new markets.

Current wording

We expect our operating results to significantly fluctuate from quarter-to-quarter in the future as a result of various factors, many of which are outside of our control. For example, air traffic controller shortages in the Northeast and Florida continue to cause disruptions in the industry, resulting in the FAA waiving the minimum usage requirement and permitting us to voluntarily turn in up to 10% of our slots in the New York area to help protect our operations. Even with a reduced number of flights, we experienced and continue to expect challenges in the operating environment. Consequently, we believe quarter-to-quarter comparisons of our operating results may not necessarily be meaningful; you should not rely on our results for any one quarter as an indication of our future performance. Except for uncertainty related to the cost of aircraft fuel, we expect our expenses to continue to increase as we acquire additional aircraft and as our fleet ages.

Previous wording

Operational challenges impacted our business in the first quarter of 2024. These challenges include disruptions in our supply chains and those of our business partners, leading to aircraft delivery delays. Additionally, reliability challenges with some of our aircraft engines using new technology have led to grounded aircraft events. These challenges have resulted - and are expected to continue to result - in flight delays and cancellations.

Current wording

Operational challenges have had an impact on our business in the second quarter of 2024. Additionally, reliability challenges with some of our aircraft engines using new technology have led to grounded aircraft events. These challenges have resulted - and are expected to continue to result - in flight delays and cancellations.

Previous wording

At March 31, 2024, we had unrestricted cash, cash equivalents, short-term investments, and long-term marketable securities of approximately $1.7 billion, which we believe will be sufficient to satisfy our liquidity needs for at least the next twelve months from the date of this Report, and we expect to meet our long-term liquidity needs with our projected cash from operations, available lines of credit and debt financing.

Current wording

At June 30, 2024, we had unrestricted cash, cash equivalents, short-term investments, and long-term marketable securities of$1.6 billion, which we believe will be sufficient to satisfy our liquidity needs for at least the next twelve months from the date of this Report, and we expect to meet our long-term liquidity needs with our projected cash from operations, available lines of credit and debt financing.

Previous wording

We rely primarily on operating cash flows to provide working capital for current and future operations. Cash flows from operating activities were $204 million and $405 million for the three months ended March 31, 2024 and 2023, respectively. The decrease in operating cash flow is driven by the change in working capital and Spirit merger termination.

Current wording

We rely primarily on operating cash flows to provide working capital for current and future operations. Cash flows from operating activities were $190 million and $663 million for the six months ended June 30, 2024 and 2023, respectively. The decrease in operating cash flow is driven by the change in working capital and Spirit merger termination.

Previous wording

During the three months ended March 31, 2024, flight equipment capital expenditures included $386 million related to the purchase of aircraft and spare engines as well as aircraft interior modifications. Flight capital expenditures also included $20 million in spare part purchases. Other property and equipment capital expenditures included ground equipment purchases and facilities improvements for $21 million. Investing activities for the current year period also included $93 million in net proceeds from investment securities, $39 million in pre-delivery deposit payments for future aircraft deliveries and $22 million in Spirit shareholder payments.

Current wording

During the six months ended June 30, 2024, flight equipment capital expenditures included $766 million related to the purchase of aircraft and spare engines as well as aircraft interior modifications. Flight capital expenditures also included $45 million in spare part purchases. Other property and equipment capital expenditures included ground equipment purchases and facilities improvements for $43 million. Investing activities for the current year period also included $277 million in net proceeds from investment securities, $63 million in pre-delivery deposit payments for future aircraft deliveries and $22 million in Spirit shareholder payments.

Previous wording

During the three months ended March 31, 2023, flight equipment capital expenditures included $131 million related to the purchase of aircraft and spare engines as well as aircraft interior modifications. Flight capital expenditures also included $10 million in spare part purchases. Other property and equipment capital expenditures included ground equipment purchases and facilities improvements for $31 million. Investing activities also included $165 million in net proceeds from investment securities and $33 million in Spirit shareholder payments.

Current wording

During the six months ended June 30, 2023, flight equipment capital expenditures included $351 million related to the purchase of aircraft and spare engines as well as aircraft interior modifications. Flight capital expenditures also included $24 million in spare part purchases. Other property and equipment capital expenditures included ground equipment purchases and facilities improvements for $64 million. Investing activities also included $148 million in net proceeds from investment securities, $66 million in Spirit shareholder payments and $18 million in pre-delivery deposit payments.

Previous wording

Financing activities for the three months ended March 31, 2024 primarily consisted of proceeds from sale-leaseback transactions of $332 million partially offset by $58 million in payments on our outstanding debt and finance lease obligations.

Current wording

Financing activities for the six months ended June 30, 2024 primarily consisted of proceeds from sale-leaseback transactions of $470 million, issuance of $281 million in equipment notes to finance certain aircraft and issuance of common stock of$31 million related to our crewmember stock purchase plan. These proceeds were partially offset by $166 million in payments on our outstanding debt and finance lease obligations.

Previous wording

We had a working capital deficit of $1.9 billion and $1.5 billion at March 31, 2024 and December 31, 2023, respectively. Our working capital deficit increased by $390 million due to several factors, including an increase in air traffic liability and other accrued liabilities.

Current wording

We had a working capital deficit of $1.8 billion and $1.5 billion at June 30, 2024 and December 31, 2023, respectively. Our working capital deficit increased by $342 million due to several factors, including an increase in air traffic liability and other accrued liabilities as well as a decrease in investment securities.

Previous wording

Our material cash requirements for known contractual and other obligations as of March 31, 2024 includes the following (in millions):

Current wording

Our material cash requirements for known contractual and other obligations includes the following (in millions):

Previous wording

The amounts stated above do not include additional obligations incurred as a result of financing activities executed after March 31, 2024.

Current wording

The amounts stated above do not include additional obligations incurred as a result of financing activities executed after June 30, 2024, except as otherwise noted.

Previous wording

As of March 31, 2024, we are in compliance with the covenants of our debt and lease agreements. We have approximately$59 million of restricted cash pledged under standby letters of credit related to certain leases that will expire at the end of the related lease terms. Approximately 61% of our owned property and equipment and intangible assets at net book value were pledged or committed to be pledged as security under various loan agreements.

Current wording

As of June 30, 2024, we were in compliance with the material covenants of our debt and lease agreements. We have approximately$57 million of restricted cash pledged under standby letters of credit related to certain leases that will expire at the end of the related lease terms. Approximately 63% of our owned property and equipment and intangible assets at net book value were pledged or committed to be pledged as security under various loan agreements.

Previous wording

(1)This table includes aircraft that have been temporarily removed from service, but are expected to return to operation in the future.

Current wording

(1)This table includes aircraft that have been temporarily removed from service, including 10 aircraft grounded as of June 30, 2024, due to the required removal of certain Pratt & Whitney engines for inspection and lack of engine availability. All aircraft temporarily removed from service are expected to return to operation in the future.

Previous wording

(2) Embraer E190 excludes 10 permanently parked owned aircraft and 6 parked aircraft awaiting lease return.

Current wording

(2) Embraer E190 excludes 13 permanently parked owned aircraft and 8 parked aircraft awaiting lease return.

Previous wording

Of our fleet,244 are owned by us, 43 are leased under operating leases, and none are leased under finance leases. Our owned aircraft include aircraft associated with sale-leaseback transactions that did not qualify as sales for accounting purposes. As of March 31, 2024, the average age of our operating fleet was 12.2 years.

Current wording

Of our fleet,253 are owned by us, 31 are leased under operating leases, and none are leased under finance leases. Our owned aircraft include aircraft associated with sale-leaseback transactions that did not qualify as sales for accounting purposes. As of June 30, 2024, the average age of our operating fleet was 12.2 years.

Previous wording

(2)In addition, we have options to purchase an additional 20 A220-300 aircraft.

Current wording

(2)In addition, we have options to purchase 20 A220-300 aircraft between 2027 and 2028.

Previous wording

Operating Expenses, excluding Fuel, Other Non-Airline Operating Expenses, and Special Items ("Operating Expenses ex-fuel") and Operating Expense ex-fuel per Available Seat Mile ex-fuel ("CASM ex-fuel")

Current wording

Operating Expenses, excluding Fuel, Other Non-Airline Operating Expenses, and Special Items ("Operating Expenses ex-fuel") and Operating Expense ex-fuel per Available Seat Mile ("CASM ex-fuel")

Previous wording

For the three months ended March 31, 2024, special items included Spirit-related costs, voluntary opt-out costs, and Embraer E190 fleet transition costs. Please refer to Note 11 in our condensed consolidated financial statements included in Part 1, Item 1 of this Report.

Current wording

For the three months ended June 30, 2024, special items included voluntary opt-out costs. For the six months ended June 30, 2024, special items included Spirit-related costs, voluntary opt-out costs, and Embraer E190 fleet transition costs.