Frontier Group Holdings, Inc.
For the period ended Mar 31, 2026. Filed May 5, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 5, 2026
ULCC$7.43+4.4%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-05.
0001670076-25-000155
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsGlossary of Airline TermsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-05.
0001670076-26-000051
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsGlossary of Airline TermsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 189 previous paragraphs and 172 current paragraphs.
64 unchanged; 77 reworded; 28 added; 37 removed; 11 previous and 3 current paragraphs rearranged.
Tables are not compared: 15 previous and 12 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (28)
Current report
Recent geopolitical tensions and military conflict in the Middle East, including developments involving Iran, have contributed to volatility in global energy markets. Higher crude oil prices can increase our jet fuel costs, which we experienced during the three months ended March 31, 2026. In addition, related instability may create supply chain challenges affecting aircraft parts and other operational inputs. Continued uncertainty or further escalation could pressure our operating costs and negatively affect our financial performance. We continue to monitor the situation and the related impacts to our business.
Current report
Legal/Regulatory. During 2025, we obtained a revised preliminary assessment in the amount of $133 million related to the applicability of federal excise tax to certain optional ancillary products and services. We established reserves for certain fees subject to the assessment where we believe a loss for this matter is probable and estimable and we are contesting the assessment.
Current report
We previously received an immaterial audit assessment from the U.S. Transportation Security Administration (the “TSA”) that covered the third quarter of 2016 through the fourth quarter of 2018 and related to the remittance of TSA fees where flight credits expired unused (the “2016-2018 Audit”). We appealed this assessment to the United States Tenth Circuit Court of Appeals. In addition, we are under audit by the TSA for the period from the fourth quarter of 2019 through the fourth quarter of 2022 (the “2019-2022 Audit”). In April 2026, we lost our appeal regarding the 2016-2018 Audit and received a preliminary assessment for the 2019-2022 Audit in the amount of $42 million, which mainly covered remittance of TSA fees where flight credits expired unused as well as for other passengers that purchased tickets and did not travel. As of March 31, 2026, we recorded an additional estimated liability of $77 million (the “TSA Reserve”), which is largely related to remittance of TSA fees for passengers that purchased tickets and did not travel and is included in other current liabilities and other long-term liabilities on our condensed consolidated balance sheets and in passenger revenues within our condensed consolidated statements of operations. We could be subject to further TSA audit examinations and resulting assessments.
Current report
Fleet. In March 2026, we entered into an agreement (the “Early Return Agreement”) to terminate the leases associated with 24 A320neo aircraft, expected to be completed by the second quarter of 2026. For the three months ended March 31, 2026, we recognized $139 million of operating expenses related to the Early Return Agreement, which includes one-time charges for lease return costs and costs related to the write-off of non-recoverable capitalized prepaid maintenance and accelerated depreciation of capitalized maintenance. Please refer to “Notes to Condensed Consolidated Financial Statements — 6. Operating Leases” for additional information.
Current report
Operating Expenses
Current report
Our non-fuel expenses increased by 40% during the three months ended March 31, 2026, as compared to the corresponding prior year period, driven primarily by expenses related to the Early Return Agreement, higher rent expense due to increased lease return costs and larger fleet, and higher employee costs. CASM (excluding fuel), a non-GAAP measure, increased 42% to 10.27¢, on a 1% decrease in capacity, for the three months ended March 31, 2026, as compared to the corresponding prior year period, due to the aforementioned drivers of increased non-fuel expenses.
Current report
Operating Expenses
Current report
(a)Cost per ASM figures may not recalculate due to rounding.
Current report
Reconciliation of GAAP to Non-GAAP Financial Data
Current report
(a)Revenue and cost per ASM figures may not recalculate due to rounding.
Current report
(b)We received a court ruling relating to the remittance of TSA fees for unused travel covering the 2016-2018 Audit that resulted in a $73 million charge, the TSA Reserve, that covers probable losses in prior years subject to audit that were recorded during the three months ended March 31, 2026. See “Notes to the Condensed Consolidated Financial Statements — 8. Commitments and Contingencies” and “Reconciliation of Passenger Revenue to Adjusted Passenger Revenue” for additional information.
Current report
(e)We entered into the Early Return Agreement to early terminate the leases associated with 24 A320neo aircraft and as a result incurred non-recurring charges of $139 million in the first quarter of 2026. The $139 million includes $73 million related to the write-off of non-recoverable capitalized prepaid maintenance balances recorded in maintenance, materials and repairs; $37 million of accelerated depreciation expense related to the remeasurement of useful lives of capitalized maintenance; $35 million of lease return costs recorded in aircraft rent and $(6) million of a reversal of previously accrued lease return costs. See “Notes to Condensed Consolidated Financial Statements — 6. Operating Leases” for additional information.
Current report
Reconciliation of Passenger Revenue to Adjusted Passenger Revenue
Current report
(a)Revenue per passenger figures may not recalculate due to rounding.
Current report
(b)See “Reconciliation of GAAP to Non-GAAP Financial Data” above for discussion of adjusting items.
Current report
(c)Adjusted fare revenue, adjusted non-fare revenue, adjusted other revenue, adjusted ancillary and adjusted total revenue, and respective metrics per passenger, (collectively, “revenue per passenger”) are included as supplemental disclosures because we believe they are useful metrics to properly compare our revenue performance to our peers, as revenue per passenger metrics are well-recognized performance measurements in the airline industry that are frequently used by our management, as well as by investors, securities analysts and other interested parties in comparing the operating performance of companies in the airline industry. Additionally, we believe these metrics are useful because they remove certain items that may not be indicative of our base operating performance or future results. These metrics are not determined in accordance with GAAP, may not be comparable across all carriers and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Current report
(b)Represents lease termination costs and write-off of non-recoverable capitalized maintenance costs associated with the Early Return Agreement. See “Notes to Condensed Consolidated Financial Statements — 6. Operating Leases” for additional information.
Current report
(c)Represents lease termination costs related to aircraft rent associated with the Early Return Agreement. See “Notes to Condensed Consolidated Financial Statements — 6. Operating Leases” for additional information.
Current report
The $234 million of inflows from changes in operating assets and liabilities included:
Current report
•$256 million in increases in other liabilities primarily driven by the TSA Reserve, cash received for supplier incentives, increased leased aircraft return accruals related to the Early Return Agreement, and increases to other operational related accruals;
Current report
•$104 million in adjustments for the Early Return Agreement primarily related to non-cash impacts from non-recoverable capitalized prepaid maintenance and accelerated depreciation;
Current report
The $15 million of outflows from changes in operating assets and liabilities included:
Current report
•$16 million in increases in accounts receivable; partially offset by
Current report
During the three months ended March 31, 2026, net cash provided by investing activities totaled $33 million, driven by:
Current report
•$45 million in net inflows for PDP activity; partially offset by
Current report
“Adjusted RASM” is a non-GAAP measure and means total revenues, excluding special items, divided by ASMs. For a discussion of such special items and a reconciliation of RASM to adjusted RASM, please see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations.”
Current report
“Net interest expenses (income)” means interest expense, capitalized interest, interest income and other.
Current report
“TSA” means the U.S. Transportation Security Administration.
Removed paragraphs (37)
Previous report
In July 2025, the One Big Beautiful Bill Act (the “OBBBA”) was signed into law. We will continue to monitor the situation but do not believe this legislation will have a material impact on our income tax expense or materially change our effective income tax rate for 2025. Please refer to “Notes to Condensed Consolidated Financial Statements — 10. Income Taxes” for additional information.
Previous report
Beginning October 1, 2025, the most recent federal government shutdown began. The government shutdown is not expected to impede the eventual operation of our incoming aircraft, however there could be unforeseen delays as a result. Further, the shutdown may cause operational issues at airports resulting from lower attendance by air traffic controllers and Transportation Security Administration officers. We continue to monitor the situation and the related impacts to our business.
Previous report
Pratt & Whitney. Since 2022, we have introduced aircraft into our fleet that use the Pratt & Whitney PW1100 Geared Turbo Fan (“GTF”) engine, and we have selected this engine for our planned future deliveries. During 2023, Pratt & Whitney announced the requirement, mandated by the U.S. Federal Aviation Administration, that certain engines be removed for inspection due to a possible condition in the powdered metal used to manufacture certain engine parts. This will require accelerated inspection of the PW1100 GTF engine, which we use for certain of our A320neo family aircraft, and could result in lengthy turnaround times to perform these inspections, including any resulting repairs or other modifications that may be identified. Although our operations have not been materially impacted as of September 30, 2025, this inspection program may have an adverse impact on our operations, particularly when we are required to temporarily take aircraft out of service. We continue to assess the impact on our future capacity plans.
Previous report
Total operating revenues for the nine months ended September 30, 2025 totaled $2,727 million, a decrease of 2% compared to the nine months ended September 30, 2024. This was primarily due to a decrease in RASM of 1% driven by a 1% decrease in total revenue per passenger, as compared to the corresponding prior year period.
Previous report
Our non-fuel expenses increased by 11% during the three months ended September 30, 2025, as compared to the corresponding prior year period, driven primarily by the benefit from a legal settlement in the prior period, higher employee benefit and incentive costs, and increased station costs due to station mix and rate inflation, partly offset by decreased operations from fewer departures and passengers. CASM (excluding fuel), a non-GAAP measure, increased 16% to 7.53¢, on a 4% decrease in capacity for the three months ended September 30, 2025, as compared to the corresponding prior year period based on the aforementioned factors.
Previous report
Total operating expenses during the nine months ended September 30, 2025 increased to $2,925 million, resulting in a CASM of 9.77¢, an increase of 6% compared to the nine months ended September 30, 2024. Fuel expense for the nine months ended September 30, 2025 was $110 million lower than the corresponding prior year period. The 14% decrease in fuel expense for the nine months ended September 30, 2025 was driven by the 12% decrease in fuel cost per gallon and a 2% decrease in fuel gallons consumed.
Previous report
Our non-fuel expenses increased 14% during the nine months ended September 30, 2025, as compared to the corresponding prior year period, driven primarily by increased aircraft rent due to a larger fleet, increased station costs due to station mix and rate inflation, a decrease in sale-leaseback transactions, increased employee costs, as well as the benefit from a legal settlement in the prior period, partly offset by lower lease return costs during the same period. CASM (excluding fuel), a non-GAAP measure, increased 15% to 7.42¢, while capacity remained consistent for the nine months ended September 30, 2025, as compared to the corresponding prior year based on the aforementioned factors.
Previous report
We generated a net loss of $190 million during the nine months ended September 30, 2025, compared to net income of $31 million for the nine months ended September 30, 2024. There were no non-GAAP adjustments for the nine months ended September 30, 2025. Considering the aforementioned non-GAAP adjustments, as well as the $5 million valuation allowance and the write-off of $1 million in unamortized deferred financing costs, our adjusted net loss, a non-GAAP measure, was $1 million for the nine months ended September 30, 2024.
Previous report
Total operating revenue decreased $49 million, or 5%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 primarily driven by 4% lower capacity, as measured by ASMs, and a 2% decrease to RASM. Strategic initiatives to stabilize pricing resulted in a moderation of capacity, which was driven by a 15% decrease in average daily aircraft utilization during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, partially offset by the 9% increase in average aircraft in service. The decrease in RASM was driven by 7% higher average stage length, supported by 12% fewer departures, partially offset by the 2.7-point increase in load factor and a 1% increase in total revenue per passenger, as compared to the corresponding prior year period.
Previous report
N/M = Not meaningful
Previous report
Aircraft Fuel. Aircraft fuel expense decreased by $27 million, or 10%, during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. The decrease was primarily due to the 6% decrease in fuel gallons consumed, driven by lower capacity, as well as a 5% decrease in fuel cost per gallon.
Previous report
This decrease was primarily due to lower engine repair costs from recognition of vendor credits, partially offset by the increase in aircraft repairs and materials costs, driven by the 9% increase to average aircraft in service.
Previous report
Other Operating. Other operating resulted in an expense of $10 million during the three months ended September 30, 2025, compared to a net gain of $40 million during the three months ended September 30, 2024. This movement was primarily driven by a legal settlement gain of $40 million in the corresponding prior year period.
Previous report
Results of Operations
Previous report
Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024
Previous report
Operating Revenues
Previous report
N/M = Not meaningful
Previous report
Aircraft Rent. Aircraft rent expense increased by $53 million, or 11%, during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, primarily due to a larger fleet, partially offset by lower aircraft lease return costs.
Previous report
Station Operations. Station operations expense increased by $67 million, or 14%, during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, primarily due to an increase in station mix and rate inflation.
Previous report
Sales and Marketing. Sales and marketing expense decreased by $15 million, or 11%, during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, primarily due to the decrease in third-party distribution channel fees, call center operation fees, credit card fees and media advertising. The following table presents our distribution channel mix:
Previous report
Depreciation and Amortization. Depreciation and amortization expense increased by$12 million, or 23%, during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, primarily due to an increase in capital maintenance depreciation driven by our growing fleet.
Previous report
(c)We reached a legal settlement with a former lessor for breach of contract for a total of $40 million. $38 million of the settlement represents a one-time reimbursement of damages incurred and $2 million relates to the reimbursement of previously recorded legal expenses.
Previous report
(e)In 2024, we reduced the capacity of the PDP Financing Facility from $365 million to $135 million. The downsize of the facility resulted in a one-time write-off of $1 million in unamortized deferred financing costs. This amount is a component of interest expense within our condensed consolidated statements of operations.
Previous report
(c)We reached a legal settlement with a former lessor for breach of contract for a total of $40 million. $38 million of the settlement represents a one-time reimbursement of damages incurred and $2 million relates to the reimbursement of previously recorded legal expenses.
Previous report
(e)In 2024, we reduced the capacity of the PDP Financing Facility from $365 million to $135 million. The downsize of the facility resulted in a one-time write-off of $1 million in unamortized deferred financing costs. This amount is a component of interest expense within our condensed consolidated statements of operations.
Previous report
(b)During the nine months ended September 30, 2024, we recorded a $5 million non-cash valuation allowance against our U.S. federal and state net operating loss deferred tax assets, which largely do not expire, mainly as a result of being in a three-year historical cumulative pre-tax loss position and due to the loss generated during the three months ended March 31, 2024, which has no impact on cash taxes and is not reflective of our effective tax rate for deductible net operating losses generated or actual cash tax obligations created. Please refer to “Notes to Condensed Consolidated Financial Statements — 10. Income Taxes” for additional information.
Previous report
During the nine months ended September 30, 2024, we reached an agreement with one of our aircraft lessors which eliminated requirements to pay maintenance reserves held as collateral in advance of our required performance of major maintenance activities on our aircraft leases. As a result of the agreement, the lessor disbursed back to us previously paid aircraft maintenance deposits of approximately $104 million. As a result, we no longer have any aircraft maintenance deposits with any of our lessors.
Previous report
The $172 million of outflows from changes in operating assets and liabilities included:
Previous report
The $51 million of outflows from changes in operating assets and liabilities included:
Previous report
•$53 million in increases in accounts receivable primarily from a legal settlement; partially offset by
Previous report
•$82 million in decreases in our capitalized aircraft maintenance deposits;
Previous report
•$1 million loss on extinguishment of debt.
Previous report
During the nine months ended September 30, 2024, net cash used in investing activities totaled $46 million, driven by:
Previous report
•$1 million in cash outflows relating to other investing activity; partially offset by
Previous report
•$17 million in net proceeds for PDP activity.
Previous report
•$420 million in cash outflows from principal repayments on debt, which includes $404 million on our Pre-delivery Credit Facilities and $16 million on our prior building note that reached maturity; and
Previous report
In September 2025, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No. 2025-06, Targeted Improvements to the Accounting for Internal-Use Software. This standard is intended to improve the operability and application of guidance related to capitalized software development costs and will become effective January 1, 2028. We are assessing the potential impact this ASU may have on our consolidated financial statements upon adoption.
Reworded paragraphs (77)
Previous wording
Effective September 2025, the United States and European Union reached a trade agreement. The agreement, among other changes, included an exemption on tariffs for aircrafts and aircraft parts. We continue to monitor the situation and the related impacts to our business.
Current wording
Macroeconomic Conditions. In February 2026, the Supreme Court ruled that the International Emergency Economic Powers Act (“IEEPA”) does not give the President the authority to impose tariffs and therefore any tariffs imposed by President Trump under the IEEPA were not authorized. Subsequently, the Trump Administration imposed a new 10% across-the-board surcharge on imports. Additionally, effective September 2025, the United States and European Union reached a trade agreement. The agreement, among other changes, included an exemption on tariffs for aircraft and aircraft parts. We continue to monitor the situation and the related impacts to our business.
Previous wording
Macroeconomic Conditions. The Trump Administration is in the process of expanding the scope of tariffs, which has significantly increased the rates on goods imported into the United States. In response, foreign governments have imposed, and are expected to impose, retaliatory measures against the United States. These or additional changes in U.S. or international trade policies, along with continued uncertainty surrounding such policies, could lead to further weakened business conditions for the transportation industry, which may adversely impact our operations through increased supply chain challenges, commodity price volatility and a decline in discretionary spending and consumer confidence, among other impacts.
Current wording
These or additional changes in U.S. or international trade policies, along with continued uncertainty surrounding such policies, could lead to further weakened business conditions for the transportation industry, which may adversely impact our operations through increased supply chain challenges, commodity price volatility and a decline in discretionary spending and consumer confidence, among other impacts.
Previous wording
Labor. We are currently in negotiations with the unions which represent our pilots, flight attendants, material specialists, aircraft technicians and maintenance controllers regarding their next labor contracts. Please refer to “Notes to Condensed Consolidated Financial Statements — 8. Commitments and Contingencies” for additional information.
Current wording
Labor. We are currently in negotiations with the unions which represent our pilots, flight attendants, and aircraft technicians regarding their next labor contracts. Please refer to “Notes to Condensed Consolidated Financial Statements — 8. Commitments and Contingencies” for additional information.
Previous wording
The following table provides select financial and operational information for the three and nine months ended September 30, 2025 and 2024 (in millions, except for per share data):
Current wording
The following table provides select financial and operational information for the three months ended March 31, 2026 and 2025 (in millions):
Previous wording
Total operating revenues for the three months ended September 30, 2025 totaled $886 million, a decrease of 5% compared to the three months ended September 30, 2024. This was primarily due to a 4% moderation in capacity, as measured by ASMs, as part of our disciplined capacity deployment, and a 2% decrease in revenue per available seat mile (“RASM”) for the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. The RASM decrease was driven by a 7% higher average stage length supported by 12% fewer departures, which also contributed to the 6% decrease in passenger enplanements, partly offset by the 2.7-point increase in load factor and 1% increase in total revenue per passenger, as compared to the corresponding prior year period.
Current wording
Total operating revenues for the three months ended March 31, 2026 totaled $992 million, an increase of 9% compared to the three months ended March 31, 2025. Revenue per available seat mile (“RASM”), increased by 10% driven by a 2% increase in total revenue per passenger as compared to the corresponding prior year period, alongside a 3.5-point increase in load factor. Capacity, as measured by ASMs, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, decreased by 1%.
Previous wording
Adjusted CASM (excluding fuel), a non-GAAP measure, increased from 6.60¢ for the nine months ended September 30, 2024 to 7.42¢ for the nine months ended September 30, 2025. There were no adjustments for the nine months ended September 30, 2025. For the nine months ended September 30, 2024, this excludes the impact of the $38 million relating to the legal settlement.
Current wording
Adjusted RASM, a non-GAAP measure, increased from $9.17 during the three months ended March 31, 2025 to $10.86 during the three months ended March 31, 2026. For the three months ended March 31, 2026, this excludes the impact of $73 million related to the TSA Reserve associated with prior periods. There were no adjustments for the three months ended March 31, 2025.
Previous wording
Total operating expenses during the three months ended September 30, 2025 increased to $963 million, resulting in a cost per available seat mile (“CASM”) of 9.95¢, an increase of 9%, as compared to the three months ended September 30, 2024. Fuel expense for the three months ended September 30, 2025 was $27 million lower than the corresponding prior year period. The 10% decrease in fuel expense for the three months ended September 30, 2025 was primarily driven by the 6% decrease in fuel gallons consumed as a result of our 4% capacity reduction, as well as the 5% decrease in fuel cost per gallon.
Current wording
Total operating expenses during the three months ended March 31, 2026 increased to $1,275 million, resulting in a cost per available seat mile (“CASM”) of 13.00¢, an increase of 35%, as compared to the three months ended March 31, 2025. Fuel expense for the three months ended March 31, 2026 was $30 million higher than the corresponding prior year period. The 13% increase in fuel expense for the three months ended March 31, 2026 was primarily driven by the 13% increase in fuel cost per gallon.
Previous wording
Adjusted CASM (excluding fuel), a non-GAAP measure, increased from 6.89¢ for the three months ended September 30, 2024 to 7.53¢ for the three months ended September 30, 2025. There were no adjustments for the three months ended September 30, 2025. For the three months ended September 30, 2024, this excludes the impact of $38 million relating to the legal settlement.
Current wording
Adjusted CASM (excluding fuel), a non-GAAP measure, increased from 7.24¢ for the three months ended March 31, 2025 to 8.85¢ for the three months ended March 31, 2026. For the three months ended March 31, 2026, this excludes the impact of $139 million in expenses relating to the Early Return Agreement. There were no adjustments for the three months ended March 31, 2025.
Previous wording
We generated a net loss of $77 million during the three months ended September 30, 2025, compared to net income of $26 million for the three months ended September 30, 2024. There were no non-GAAP adjustments for the three months ended September 30, 2025. Considering the aforementioned non-GAAP adjustments, as well as the write-off of $1 million in unamortized deferred financing costs, our adjusted net loss, a non-GAAP measure, was $11 million for the three months ended September 30, 2024.
Current wording
We generated a net loss of $272 million during the three months ended March 31, 2026, compared to net loss of $43 million for the three months ended March 31, 2025. Considering the aforementioned non-GAAP adjustments and related $8 million of tax impacts, our adjusted net loss, a non-GAAP measure, was $68 million for the three months ended March 31, 2026. There were no non-GAAP adjustments for the three months ended March 31, 2025.
Previous wording
For the reconciliation to the corresponding GAAP measures of the aforementioned non-GAAP adjusted measures, see “Results of Operations — Reconciliation of CASM to CASM (excluding fuel), Adjusted CASM (excluding fuel), Adjusted CASM, Adjusted CASM including net interest and CASM including net interest” and “Results of Operations — Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss), Pre-Tax Income (Loss) to Adjusted Pre-Tax Income (Loss), and Net Income (Loss) to EBITDA, EBITDAR, Adjusted EBITDA, and Adjusted EBITDAR.”
Current wording
For the reconciliation to the corresponding GAAP measures of the aforementioned non-GAAP adjusted measures, see “Results of Operations — “Reconciliation of GAAP to Non-GAAP Financial Data.”, “Reconciliation of Passenger Revenue to Adjusted Passenger Revenue”, and “Results of Operations — Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss), Pre-Tax Income (Loss) to Adjusted Pre-Tax Income (Loss), and Net Income (Loss) to EBITDA, EBITDAR, Adjusted EBITDA, and Adjusted EBITDAR.”
Previous wording
As of September 30, 2025, our total available liquidity was $691 million, consisting of $561 million of unrestricted cash and cash equivalents and availability under our revolving line of credit (the “Revolving Loan Facility”).
Current wording
As of March 31, 2026, our total available liquidity was $974 million, consisting of $754 million of unrestricted cash and cash equivalents and availability under our revolving line of credit (the “Revolving Loan Facility”).
Previous wording
(b)This metric is not calculated in accordance with GAAP. For the reconciliation to the corresponding GAAP measures of the aforementioned non-GAAP adjusted measures, see “Reconciliation of CASM to CASM (excluding fuel), Adjusted CASM (excluding fuel), Adjusted CASM, Adjusted CASM including net interest and CASM including net interest.”
Current wording
(a)This metric is not calculated in accordance with GAAP. For the reconciliation to the corresponding GAAP measures of the aforementioned non-GAAP adjusted measures, see “Reconciliation of GAAP to Non-GAAP Financial Data.”
Previous wording
Total operating revenue decreased $46 million or 2% during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. Revenue was unfavorably impacted by the 1% decrease in RASM, driven by 3% higher average stage length, supported by 5% fewer departures, and a 1% decrease in total revenue per passenger, partially offset by the 1.9-point increase in load factor as compared to the corresponding prior year period. Capacity, as measured by ASMs, for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024, remained consistent due to the 10% increase in average aircraft in service, offset by an 11% decrease in average daily aircraft utilization.
Current wording
Total operating revenue increased $80 million, or 9%, during the three months ended March 31, 2026 compared to the three months ended March 31, 2025. Revenue was favorably impacted by the 10% increase in RASM, driven by a 2% increase in total revenue per passenger as compared to the corresponding prior year period, alongside a 3.5-point increase in load factor. Revenue was unfavorably impacted by $77 million related to the TSA Reserve during the three months ended March 31, 2026. In addition, capacity, as measured by ASMs, for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, decreased by 1% primarily due to a 12% decrease in average daily aircraft utilization partially offset by the 14% increase in average aircraft in service.
Previous wording
(b)These metrics are not calculated in accordance with GAAP. For the reconciliation to the corresponding GAAP measures of the aforementioned non-GAAP adjusted measures, see “Reconciliation of CASM to CASM (excluding fuel), Adjusted CASM (excluding fuel), Adjusted CASM, Adjusted CASM including net interest and CASM including net interest.”
Current wording
(b)These metrics are not calculated in accordance with GAAP. For the reconciliation to the corresponding GAAP measures of the aforementioned non-GAAP adjusted measures, see “Reconciliation of GAAP to Non-GAAP Financial Data.”
Previous wording
Aircraft Fuel. Aircraft fuel expense decreased by $110 million, or 14%, during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024. The decrease was primarily due to the 12% decrease in fuel cost per gallon, as well as a 2% decrease in fuel gallons consumed.
Current wording
Aircraft Fuel. Aircraft fuel expense increased by $30 million, or 13%, during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase was due to a 13% increase in fuel cost per gallon.
Previous wording
Salaries, Wages and Benefits. Salaries, wages and benefits expense increased by $15 million, or 6%, during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. The increase was primarily due to higher employee benefit and incentive costs, as compared to the corresponding prior year period.
Current wording
Salaries, Wages and Benefits. Salaries, wages and benefits expense increased by $22 million, or 9%, during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The increase was primarily due to higher crew costs, as compared to the corresponding prior year period.
Previous wording
Aircraft Rent. Aircraft rent expense increased by $4 million, or 2%, during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, primarily due to a larger fleet, partially offset by lower aircraft lease return costs.
Current wording
Aircraft Rent. Aircraft rent expense increased by $104 million, or 65%, during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to additional lease return expense, in part related to the Early Return Agreement, and a larger fleet.
Previous wording
Station Operations. Station operations expense increased by $9 million, or 5%, during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, primarily due to an increase in station mix and rate inflation, partially offset by a 6% decrease in passengers and 12% decrease in departures.
Current wording
Station Operations. Station operations expense increased by $12 million, or 7%, during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to an increase in airport cost sharing arrangements and a 6% increase in passengers.
Previous wording
Maintenance, Materials and Repairs. Maintenance, materials and repair expense decreased by $1 million, or 2%, during the three months ended September 30, 2025, as compared to the three months ended September 30,
Current wording
Maintenance, Materials and Repairs. Maintenance, materials and repair expense increased by $91 million, or 178%, during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. This increase was primarily due to the write-off on non-recoverable prepaid maintenance balances related to the Early Return Agreement and the 14% increase in average aircraft in service, which resulted in higher aircraft repair and materials costs.
Previous wording
Sales and Marketing. Sales and marketing expense decreased by $8 million or 17%, during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, primarily due to a decrease in third-party distribution channel fees and a decrease in call center operation fees. The following table presents our distribution channel mix:
Current wording
Sales and Marketing. Sales and marketing expense increased by $2 million, or 5%, during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to an increase in credit card fees, partially offset by a decrease in third-party distribution channel fees. The following table presents our distribution channel mix:
Previous wording
Depreciation and Amortization. Depreciation and amortization expense increased by $5 million, or 26%, during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024, primarily due to an increase in capital maintenance depreciation driven by our growing fleet.
Current wording
Depreciation and Amortization. Depreciation and amortization expense increased by$42 million, or 210%, during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025, primarily due to the accelerated depreciation on capitalized maintenance costs related to the Early Return Agreement and the increase in capitalized maintenance depreciation due to our growing fleet.
Previous wording
Other Operating. Other operating resulted in an expense of $69 million during the nine months ended September 30, 2025, compared to a net gain of $42 million during the nine months ended September 30, 2024. This movement was primarily driven by the decrease in sale-leaseback gains, as a result of 9 aircraft inductions and 8 engine inductions subject to sale-leaseback transactions in the current period, compared to 17 aircraft inductions and 3 engine inductions subject to sale-leaseback transactions in the corresponding prior year period, as well as a legal settlement gain of $40 million during the nine months ended September 30, 2024.
Current wording
Other Operating Expense. Other operating expenses increased by $14 million, or 78%, during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. This increase was primarily driven by the decrease in sale-leaseback gains, as a result of 7 aircraft inductions compared to 4 aircraft inductions and 2 engine inductions in the corresponding prior year period subject to sale-leaseback transactions, and an increase in travel costs.
Previous wording
Other Income (Expense). Other income decreased by $7 million, or 88%, during the three months ended September 30, 2025, as compared to the three months ended September 30, 2024. The decrease was primarily due to increased interest expense, driven by higher principal balances on our debt and decreased interest income from lower balances in interest-bearing cash accounts, partially offset by greater capitalized interest.
Current wording
Other Income (Expense). Other income decreased by $4 million, or 67%, during the three months ended March 31, 2026, as compared to the three months ended March 31, 2025. The decrease was primarily due to increased interest expense, driven by higher principal balances on our debt from the addition of the class A-1 enhanced equipment trust certificates (the “2025-1 EETCs”) and decreased interest income from lower interest rates on interest-bearing cash accounts.
Previous wording
Income Taxes. Our effective tax rate for the nine months ended September 30, 2025 was an expense of 2.2%, compared to an expense of 11.4% for the nine months ended September 30, 2024, on pre-tax loss and pre-tax income for each of the respective periods. The primary difference between the effective tax rate and the federal statutory rate for the nine months ended September 30, 2025 was related to an increase in our valuation allowance relating to federal and state net operating losses. Please refer to “Notes to Condensed Consolidated Financial Statements — 10. Income Taxes” for additional information.
Current wording
Income Taxes. Our effective tax rate for the three months ended March 31, 2026 was a benefit of 3.2%, compared to an expense of 7.5% for the three months ended March 31, 2025, on pre-tax loss for each of the respective periods. The primary difference between the effective tax rate and the federal statutory rate for the three months ended March 31, 2026 was related to the increase in our valuation allowance relating to U.S. federal and state net operating loss. Please refer to “Notes to Condensed Consolidated Financial Statements — 10. Income Taxes” for additional information.
Previous wording
(d)Adjusted CASM is included as supplemental disclosure because we believe it is a useful metric to properly compare our cost management and performance to other peers, as derivations of Adjusted CASM are well-recognized performance measurements in the airline industry that are frequently used by our management, as well as by investors, securities analysts and other interested parties in comparing the operating performance of companies in the airline industry. Additionally, we believe this metric is useful because it removes certain items that may not be indicative of our base operating performance or future results. Adjusted CASM is not determined in accordance with GAAP, may not be comparable across all carriers and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Current wording
(c)Adjusted RASM is included as a supplemental disclosure because we believe it is a useful metric to properly compare our revenue performance to our peers, as RASM metrics are well-recognized performance measurements in the airline industry that are frequently used by our management, as well as by investors, securities analysts and other interested parties in comparing the operating performance of companies in the airline industry. Additionally, we believe this metric is useful because it removes certain items that may not be indicative of our base operating performance or future results. Adjusted RASM is not determined in accordance with GAAP, may not be comparable across all carriers and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Previous wording
(b)CASM (excluding fuel) and Adjusted CASM (excluding fuel) are included as supplemental disclosures because we believe that excluding aircraft fuel is useful to investors as it provides an additional measure of management’s performance excluding the effects of a significant cost item over which management has limited influence. The price of fuel, over which we have limited control, impacts the comparability of period-to-period financial performance, and excluding the price of fuel allows management an additional tool to understand and analyze our non-fuel costs and core operating performance, and increases comparability with other airlines that also provide a similar metric. CASM (excluding fuel) and Adjusted CASM (excluding fuel) are not determined in accordance with GAAP and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Current wording
(d)CASM (excluding fuel) and Adjusted CASM (excluding fuel) are included as supplemental disclosures because we believe that excluding aircraft fuel is useful to investors as it provides an additional measure of management’s performance excluding the effects of a significant cost item over which management has limited influence. The price of fuel, over which we have limited control, impacts the comparability of period-to-period financial performance, and excluding the price of fuel allows management an additional tool to understand and analyze our non-fuel costs and core operating performance, and increases comparability with other airlines that also provide a similar metric. CASM (excluding fuel) and Adjusted CASM (excluding fuel) are not determined in accordance with GAAP and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Previous wording
(d)Adjusted CASM is included as supplemental disclosure because we believe it is a useful metric to properly compare our cost management and performance to other peers, as derivations of Adjusted CASM are well-recognized performance measurements in the airline industry that are frequently used by our management, as well as by investors, securities analysts and other interested parties in comparing the operating performance of companies in the airline industry. Additionally, we believe this metric is useful because it removes certain items that may not be indicative of our base operating performance or future results. Adjusted CASM is not determined in accordance with GAAP, may not be comparable across all carriers and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Current wording
(f)Adjusted CASM is included as supplemental disclosure because we believe it is a useful metric to properly compare our cost management and performance to other peers, as derivations of Adjusted CASM are well-recognized performance measurements in the airline industry that are frequently used by our management, as well as by investors, securities analysts and other interested parties in comparing the operating performance of companies in the airline industry. Additionally, we believe this metric is useful because it removes certain items that may not be indicative of our base operating performance or future results. Adjusted CASM is not determined in accordance with
Previous wording
(f)Adjusted CASM including net interest and CASM including net interest are included as supplemental disclosures because we believe they are useful metrics to properly compare our cost management and performance to other peers that may have different capital structures and financing strategies, particularly as it relates to financing primary operating assets such as aircraft and engines. Additionally, we believe Adjusted CASM including net interest is useful because it removes certain items that may not be indicative of our base operating performance or future results. Adjusted CASM including net interest and CASM including net interest are not determined in accordance with GAAP, may not be comparable across all carriers and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Current wording
(g)Adjusted CASM including net interest and CASM including net interest are included as supplemental disclosures because we believe they are useful metrics to properly compare our cost management and performance to other peers that may have different capital structures and financing strategies, particularly as it relates to financing primary operating assets such as aircraft and engines. Additionally, we believe Adjusted CASM including net interest is useful because it removes certain items that may not be indicative of our base operating performance or future results. Adjusted CASM including net interest and CASM including net interest are not determined in accordance with GAAP, may not be comparable across all carriers and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Previous wording
Adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA have limitations as analytical tools. Some of the limitations applicable to these measures include: adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA do not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations; adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA do not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments; EBITDA and adjusted EBITDA do not reflect changes in, or cash requirements for, our working capital needs; EBITDA, and adjusted EBITDA do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on our indebtedness or possible cash requirements related to our warrants; although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA and adjusted EBITDA do not reflect any cash requirements for such replacements; and other companies in our industry may calculate adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA differently than we do, limiting their usefulness as comparative measures. Because of these limitations, adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA should not be considered in isolation from or as a substitute for performance measures calculated in accordance with GAAP. In addition, because derivations of adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA are not determined in accordance with GAAP, such measures are susceptible to varying calculations and not all companies calculate the measures in the same manner. As a result, derivations of pre-tax income (loss), net income (loss) and EBITDA, including adjusted pre-tax income (loss), adjusted net income (loss) and adjusted EBITDA, as presented may not be directly comparable to similarly titled measures presented by other companies.
Current wording
Adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA have limitations as analytical tools. Some of the limitations applicable to these measures include: adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA do not reflect the impact of certain cash charges resulting from matters we consider not to be indicative of our ongoing operations; adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA do not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments; EBITDA and adjusted EBITDA do not reflect changes in, or cash requirements for, our working capital needs; EBITDA, and adjusted EBITDA do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments on our indebtedness; although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA and adjusted EBITDA do not reflect any cash requirements for such replacements; and other companies in our industry may calculate adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA differently than we do, limiting their usefulness as comparative measures. Because of these limitations, adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA should not be considered in isolation from or as a substitute for performance measures calculated in accordance with GAAP. In addition, because derivations of adjusted pre-tax income (loss), adjusted net income (loss), EBITDA and adjusted EBITDA are not determined in accordance with GAAP, such measures are susceptible to varying calculations and not all companies calculate the measures in the same manner. As a result, derivations of pre-tax income (loss), net income (loss) and EBITDA, including adjusted pre-tax income (loss), adjusted net income (loss) and adjusted EBITDA, as presented may not be directly comparable to similarly titled measures presented by other companies.
Previous wording
(a)See “Reconciliation of CASM to CASM (excluding fuel), Adjusted CASM (excluding fuel), Adjusted CASM, Adjusted CASM including net interest and CASM including net interest” above for discussion of adjusting items.
Current wording
(a)See “Reconciliation of GAAP to Non-GAAP Financial Data” above for discussion of adjusting items.
Previous wording
The following table sets forth our operating statistics for the three and nine months ended September 30, 2025 and 2024. These operating statistics are provided because they are commonly used in the airline industry and, as such, allow readers to compare our performance against our results for the corresponding prior year period, as well as against the performance of our peers.
Current wording
The following table sets forth our operating statistics for the three months ended March 31, 2026 and 2025. These operating statistics are provided because they are commonly used in the airline industry and, as such, allow readers to compare our performance against our results for the corresponding prior year period, as well as against the performance of our peers.
Previous wording
(b)These metrics are not calculated in accordance with GAAP. For the reconciliation to corresponding GAAP measures, see “Results of Operations—Reconciliation of CASM to CASM (excluding fuel), Adjusted CASM (excluding fuel), Adjusted CASM, Adjusted CASM including net interest and CASM including net interest.”
Current wording
(b)These metrics are not calculated in accordance with GAAP. For the reconciliation to corresponding GAAP measures, see “Results of Operations—Reconciliation of GAAP to Non-GAAP Financial Data.”
Previous wording
As of September 30, 2025, our total available liquidity was $691 million, consisting of $561 million of unrestricted cash and cash equivalents and funds available to be drawn under our Revolving Loan Facility. We had $668 million of total debt, net, of which $363 million is short-term and consists primarily of amounts outstanding under our Pre-delivery Credit Facilities. Our total debt, net is comprised of $419 million outstanding under our Pre-delivery Credit Facilities, $101 million outstanding under our pre-purchased miles facility with Barclays Bank Delaware (“Barclays”), $75 million in outstanding borrowings under the Revolving Loan Facility in order to manage the timing of fleet deliveries heavily weighted to the fourth quarter of 2025 and timing of maintenance expenditures, $66 million in 10-year notes (collectively, the “PSP Promissory Notes”) from the U.S. Department of the Treasury (the “Treasury”) and $12 million in secured indebtedness for our headquarters building, partially offset by $5 million in deferred debt acquisition costs.
Current wording
As of March 31, 2026, our total available liquidity was $974 million, consisting of $754 million of unrestricted cash and cash equivalents and $220 million of funds available to be drawn under our undrawn Revolving Loan Facility. We had $583 million of total debt, net, of which $240 million is short-term and consists primarily of amounts outstanding under our Pre-delivery Credit Facilities. Our total debt, net is comprised of $298 million outstanding under our Pre-delivery Credit Facilities, $119 million outstanding under our pre-purchased miles facility with Barclays Bank Delaware (“Barclays”), $105 million of 2025-1 EETCs and $66 million in 10-year notes (collectively, the “PSP Promissory Notes”) from the U.S. Department of the Treasury (the “Treasury”), partially offset by $5 million in deferred debt acquisition costs.
Previous wording
In connection with the term loan facility entered into with the Treasury in September 2020, which was repaid in full in February 2022, and the PSP Promissory Notes, we issued warrants (the “Warrants”) to purchase 3,117,940 shares of FGHI common stock at a weighted-average price of $6.95 per share. In June 2024, the Treasury sold all such Warrants to a financial institution. During the nine months ended September 30, 2025, 1,244,608 Warrants were exercised. We settled the exercises through a net share settlement of 248,893 shares of FGHI common stock and cash of less than $1 million. During the nine months ended September 30, 2025, 1,636,058 Warrants expired. As of September 30, 2025, Warrants to purchase 237,274 shares of FGHI common stock were outstanding and set to expire during 2026.
Current wording
In connection with the term loan facility entered into with the Treasury in September 2020, which was repaid in full in February 2022, and the PSP Promissory Notes, we issued warrants (the “Warrants”) to purchase 3,117,940 shares of FGHI common stock at a weighted-average price of $6.95 per share. In June 2024, the Treasury sold all such Warrants to a financial institution. During the three months ended March 31, 2026, 103,208 warrants expired and no warrants were exercised. As of March 31, 2026, warrants to purchase 134,066 shares of FGHI common stock were outstanding and set to expire by June 2026.
Previous wording
We expect to meet our cash requirements for the next twelve months through use of our available cash and cash equivalents, our debt facilities, cash flows from operating activities and sale-leaseback financing. We expect to meet our long-term cash requirements with cash flows from operating and financing activities, including, but not limited to, potential future borrowings under the Pre-delivery Credit Facilities, our Revolving Loan Facility and/or potential issuances of debt or equity. The Revolving Loan Facility also permits us to enter into additional indebtedness secured by our loyalty program and brand-related assets, to the extent such indebtedness is pari passu to that of the Revolving Loan Facility. Our primary uses of cash are for working capital, aircraft PDPs, debt repayments, and capital expenditures.
Current wording
We expect to meet our cash requirements for the next twelve months through use of our available cash and cash equivalents, our Pre-delivery Credit Facilities, cash flows from operating activities and sale-leaseback financing. We expect to meet our long-term cash requirements with cash flows from operating and financing activities, including, but not limited to, potential future borrowings under the Pre-delivery Credit Facilities, our undrawn Revolving Loan Facility and/or potential issuances of debt or equity. The Revolving Loan Facility also permits us to enter into additional indebtedness secured by our loyalty program and brand-related assets, to the extent such indebtedness is pari passu to that of the Revolving Loan Facility. Our primary uses of cash are for working capital, aircraft PDPs, debt repayments, and capital expenditures.
Previous wording
Our single largest capital commitment relates to the acquisition of aircraft. As of September 30, 2025, we operated all of our 166 aircraft under operating leases. PDPs relating to future deliveries under our agreement with Airbus are required at various times prior to each aircraft’s delivery date. As of September 30, 2025, our Pre-delivery Credit Facilities, which allow us to draw up to an aggregate of $476 million, had $419 million outstanding. As of September 30, 2025, we had $509 million of PDPs held by Airbus which have been partially financed by our Pre-delivery Credit Facilities.
Current wording
Our single largest capital commitment relates to the acquisition of aircraft. As of March 31, 2026, we operated a total of 183 aircraft under operating leases. PDPs relating to future deliveries under our agreement with Airbus are required at various times prior to each aircraft’s delivery date. As of March 31, 2026, our Pre-delivery Credit Facilities, which allow us to draw up to an aggregate of $326 million, had $298 million outstanding. As of March 31, 2026, we had $383 million of PDPs held by Airbus which have been partially financed by our Pre-delivery Credit Facilities.
Previous wording
As of September 30, 2025, we had a firm obligation to purchase 178 A320neo family aircraft and 31 additional spare engines to be delivered by 2031. Of our aircraft commitments, 30 had committed operating leases for deliveries occurring between 2025 and 2026. We intend to evaluate financing options for the remaining aircraft.
Current wording
As of March 31, 2026, we had a firm obligation to purchase 161 A320neo family aircraft and 20 additional spare engines to be delivered by 2033. Of our aircraft commitments, 23 had committed operating leases for deliveries occurring between 2026 and 2029. We intend to evaluate financing options for the remaining aircraft.
Previous wording
(a)Includes principal commitments only associated with our Pre-delivery Credit Facilities with borrowings as of September 30, 2025, our Revolving Loan Facility’s outstanding borrowings maturing in 2027, our affinity card unsecured debt due through 2029, our building notes due through 2031, and the PSP Promissory Notes due through 2031. See “Notes to Condensed Consolidated Financial Statements — 5. Debt.”
Current wording
(a)Includes principal commitments only associated with our Pre-delivery Credit Facilities with borrowings as of March 31, 2026, our affinity card unsecured debt due through 2029, the PSP Promissory Notes through 2031, and our class A-1 enhanced equipment certificate through 2032. See “Notes to Condensed Consolidated Financial Statements — 5. Debt.”
Previous wording
(b)Represents interest and commitment fees on debt obligations and our Revolving Loan Facility.
Current wording
(b)Represents interest and commitment fees on debt obligations and our undrawn Revolving Loan Facility.
Previous wording
(c)Represents gross cash payments related to our operating fixed lease obligations that are not subject to discount as compared to the obligations measured on our condensed consolidated balance sheets. See “Notes to Condensed Consolidated Financial Statements — 6. Operating Leases.”
Current wording
(c)Represents gross cash payments related to our operating fixed lease obligations that are not subject to discount as compared to the obligations measured on our condensed consolidated balance sheets. Also includes lease return obligations related to the Early Return Agreement. See “Notes to Condensed Consolidated Financial Statements — 6. Operating Leases.”
Showing the first 40 of 77 pairs. Open the source sections for the rest.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
GAAP, may not be comparable across all carriers and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Current report — wording carried from elsewhere
•$28 million in cash outflows from principal repayments on the Pre-delivery Credit Facilities; and
Current report — wording carried from elsewhere
“A320 family” means, collectively, the Airbus series of single-aisle aircraft, including the A320ceo, A320neo, A321ceo and A321neo aircraft.
Rearranged previous paragraphs (11)
Previous report — wording carried elsewhere
Income Taxes. Our effective tax rate for the three months ended September 30, 2025 was an expense of 1.3% on a pre-tax loss, compared to an expense of 3.7% on pre-tax income for the three months ended September 30, 2024. The primary difference between the effective tax rate and the federal statutory rate was related to an increase in our valuation allowance relating to federal and state net operating losses. Please refer to “Notes to Condensed Consolidated Financial Statements — 10. Income Taxes” for additional information.
Previous report — wording carried elsewhere
Salaries, Wages and Benefits. Salaries, wages and benefits expense increased by $41 million, or 6%, during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024. The increase was primarily due to higher crew and employee benefit and incentive costs, as compared to the corresponding prior year period.
Previous report — wording carried elsewhere
Maintenance, Materials and Repairs. Maintenance, materials and repair expense increased by $6 million, or 4%, during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024.
Previous report — wording carried elsewhere
This increase was primarily due to the 10% increase in average aircraft in service, which resulted in higher aircraft repair and materials costs, partially offset by lower engine repair costs from recognition of vendor credits.
Previous report — wording carried elsewhere
Other Income (Expense). Other income decreased by $10 million during the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024. The decrease was primarily due to increased interest expense, driven by higher principal balances on our debt and decreased interest income from lower balances in interest-bearing cash accounts, partially offset by greater capitalized interest.
Previous report — wording carried elsewhere
Reconciliation of CASM to CASM (excluding fuel), Adjusted CASM (excluding fuel), Adjusted CASM, Adjusted CASM including net interest and CASM including net interest
Previous report — wording carried elsewhere
Reconciliation of CASM to CASM (excluding fuel), Adjusted CASM (excluding fuel), Adjusted CASM, Adjusted CASM including net interest and CASM including net interest
Previous report — wording carried elsewhere
(b)CASM (excluding fuel) and Adjusted CASM (excluding fuel) are included as supplemental disclosures because we believe that excluding aircraft fuel is useful to investors as it provides an additional measure of management’s performance excluding the effects of a significant cost item over which management has limited influence. The price of fuel, over which we have limited control, impacts the comparability of period-to-period financial performance, and excluding the price of fuel allows management an additional tool to understand and analyze our non-fuel costs and core operating performance, and increases comparability with other airlines that also provide a similar metric. CASM (excluding fuel) and Adjusted CASM (excluding fuel) are not determined in accordance with GAAP and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Previous report — wording carried elsewhere
(f)Adjusted CASM including net interest and CASM including net interest are included as supplemental disclosures because we believe they are useful metrics to properly compare our cost management and performance to other peers that may have different capital structures and financing strategies, particularly as it relates to financing primary operating assets such as aircraft and engines. Additionally, we believe Adjusted CASM including net interest is useful because it removes certain items that may not be indicative of our base operating performance or future results. Adjusted CASM including net interest and CASM including net interest are not determined in accordance with GAAP, may not be comparable across all carriers and should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP.
Previous report — wording carried elsewhere
•$7 million in decreases in other liabilities primarily driven by leased aircraft return accruals and other operational related accruals, partially offset by an increase in manufacturer credits; partially offset by
Previous report — wording carried elsewhere
•$1 million in proceeds from the exercise of stock options; partially offset by