JetBlue Airways Corporation

    JBLU ·NASDAQ ·Air Transportation, Scheduled ·Inc. in DE
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    ITEM 1.    BUSINESS
    OVERVIEW
    General
    JetBlue Airways Corporation is New York's Hometown Airline®. As of December 31, 2025, JetBlue served 112 destinations across the United States, the Caribbean and Latin America, Canada and Europe.
    JetBlue was incorporated in Delaware in August 1998 and commenced service on February 11, 2000. We believe our differentiated product and culture combined with our competitive cost structure enable us to compete effectively in the high-value geographies we serve. Looking to the future, we plan to continue to grow in our high-value geographies, invest in industry-leading products, and provide award-winning service by our 23,000 dedicated employees, whom we refer to as crewmembers. Going forward, we believe we will continue to differentiate ourselves from other airlines, enabling us to continue to attract a greater mix of customers, and to drive continued growth. We are focused on delivering solid results for our stockholders, our customers, and our crewmembers.
    Our principal executive offices are located at 27-01 Queens Plaza North, Long Island City, New York 11101 and our telephone number is (718) 286-7900.
    Our Industry and Competition
    The U.S. airline industry is extremely competitive and challenging, and results are often volatile. It is uniquely susceptible to external factors such as fuel costs, downturns in domestic and international economic conditions, weather-related disruptions, air traffic control ("ATC") shortages, reduced or suspended operation of applicable regulatory agencies, the spread of infectious diseases, the impact of airline restructurings or consolidations, and military actions or acts of terrorism. We operate in a capital and energy intensive industry that has high fixed costs, as well as heavy taxation and fees. Airline returns are sensitive to slight changes in fuel prices, average fare levels, and customer demand. The industry's principal competitive factors include fares, brand and customer service, frequent flyer loyalty programs, route networks, flight schedules, aircraft types, safety records, codeshare and interline relationships, inflight entertainment and connectivity systems.
    JETBLUE EXPERIENCE
    We offer our customers a distinctive flying experience which we refer to as the "JetBlue experience". We believe we deliver award-winning service and product with competitive fares that focuses on the entire customer experience, from booking an itinerary to arrival at the final destination. We believe JetBlue is the carrier of choice for the majority of travelers who have been underserved by other airlines.
    In July 2024, we announced JetForward, our new strategic framework which is driving new initiatives focused on four priority moves: delivering reliable and caring service, building the best east coast leisure network, offering products and perks customers value, and providing a secure financial future. Refer to Part II, Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" of this report for further details on progress made on our JetForward initiatives.
    Differentiated Product and Culture
    Delivering the JetBlue experience to our customers through our differentiated product and culture is core to our mission to bring humanity back to air travel. We look to attract new customers to our brand and provide current customers with a reason to come back by continuing to innovate and evolve the JetBlue experience. We believe we can adapt to the changing needs of our customers and a key element of our success is the belief that competitive fares and a great product need not be mutually exclusive.
    We offer customers a choice of one of three JetBlue experiences: the core experience, EvenMore® and Mint®. Within the core experience, there are four fares to choose from: Blue Basic, Blue, Blue Plus, and Blue Extra. All JetBlue fares include a free carry-on bag, free seatback entertainment, free high-speed Wi-Fi, free snacks, and free non-alcoholic beverages. Customers can choose to "buy up" to an option with additional offerings. These different fares allow customers to select the products or services they need or value when they travel, without having to pay for the things they do not need or value.
    We offer core customers comfortable seating to relax and enjoy the JetBlue experience. Beginning in January 2025, EvenMore® Space was rebranded to EvenMore® which, in addition to giving customers the opportunity to enjoy additional legroom, priority security access, and early boarding, also includes dedicated overhead bin space, complimentary alcoholic beverages, and premium snack options. Our EvenMore® experience is available for purchase across our fleet. Additionally in 2025, we enhanced our EvenMore® offering, with EvenMore® now selling via global distribution systems, providing customers more opportunities to book our premium economy offering on a single ticket through travel agents and online travel agencies.
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    Customers on select coast-to-coast, Caribbean and Latin American routes and all transatlantic flights have the option to purchase Mint®, our lie-flat premium service. Each Mint® seat includes a fully lie-flat bed with our exclusive Tuft & Needle® sleep experience. Our Mint® customers also have access to an assortment of complimentary food, beverages and products including a small-plates menu, artisanal snacks, alcoholic beverages, a blanket, pillows, an amenity kit and headphones.
    On select transatlantic and coast-to-coast flights, we offer a reimagined version of our Mint® experience with a completely refreshed cabin design featuring private suites with aisle access. Each of these select Mint® aircraft also includes two front row Mint® Studios which offer the largest TV on a U.S. airline and an extra seat and space to work, lounge and entertain.
    In 2024, we announced plans to launch a domestic first-class experience across our non-Mint® fleet to offer an additional option for customers seeking a premium travel experience. The first-class experience is expected to roll out on a portion of our fleet in 2026 with the majority planned to be completed by the end of 2027.
    We offer seatback screens across our fleet, with AVANT systems installed on majority of our aircraft. AVANT equipped aircraft feature an inflight entertainment library of approximately 300 movies and 1,000 television episodes, while a small portion of the fleet operates other systems with more limited content. Customers also enjoy at least 18 channels of live TV on most flights. Our entire fleet is equipped with Fly-Fi®, our high-speed broadband service, providing gate-to-gate Wi-Fi access at every seat.
    In September 2025, we announced that JetBlue was the first airline in the world to sign on with Amazon's Leo, an advanced low Earth orbit satellite broadband network, to bring even faster and more reliable connectivity to our onboard Wi-Fi. We expect to adopt Amazon Leo's cutting-edge technology on a portion of our fleet in 2027.
    In December 2025, we opened BlueHouse, JetBlue's first airport lounge, at John F. Kennedy International Airport ("JFK") Terminal 5. The next BlueHouse location is scheduled to open at Boston Logan International Airport ("BOS") Terminal C in 2026, reinforcing our ongoing investment in premium offerings.
    Because of our network strength in leisure destinations, we also sell vacation packages through our wholly owned subsidiary, Paisly, LLC ("Paisly") (f/k/a JetBlue Travel Products), which offers one-stop, value-priced vacation services for self-directed packaged travel planning. These packages offer competitive fares for air travel on JetBlue along with a selection of JetBlue-recommended hotels and resorts, car rentals, and local attractions.
    Network
    We are a predominantly point-to-point system carrier with 95% of our routes touching at least one of our six focus cities: the New York metropolitan area, Boston, Fort Lauderdale-Hollywood, Orlando, Los Angeles and San Juan. All six of our focus cities are in regions with a diverse mix of traffic.
    Leisure traveler focused airlines are often faced with high seasonality. As a result, we continually work to manage our mix of customers to include both business travelers and travelers visiting friends and relatives ("VFR"). VFR travelers tend to be slightly less seasonal and less susceptible to economic downturns than traditional leisure destination travelers. Understanding the purpose of our customers' travel helps us optimize destinations, strengthen our network, and increase revenue.
    As of December 31, 2025, we served 112 destinations ("BlueCities") in 29 states, the District of Columbia, the Commonwealth of Puerto Rico, the U.S. Virgin Islands, Canada, and 30 countries in the Caribbean and Latin America, and Europe.
    We group our capacity distribution based upon geographical regions rather than on mileage or a length-of-haul basis. The historic distribution of available seat miles ("ASMs"), which we also refer to as capacity, by region for the years ending December 31 was:
    Capacity Distribution202520242023
    Transcontinental26.0 %27.0 %29.9 %
    Caribbean & Latin America (1)
    		36.5 35.9 33.2 
    Florida25.4 23.8 23.7 
    Other (East, Central, West)7.0 8.0 10.1 
    Transatlantic5.1 

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    Financial statements

    data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .

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    From 10-Q filed 2026-10-26 (period ending 2026-09-30).

    PART I. FINANCIAL INFORMATION
    ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

    Part I, Item 2 of this Report should be read together with our condensed consolidated financial statements and related notes included elsewhere in this Report and our audited consolidated financial statements and related notes included in our 2025 Form 10-K. This discussion contains forward-looking statements based upon current plans, expectations and beliefs involving risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in Part I, Item 1A "Risk Factors" of our 2025 Form 10-K and in Part II, Item 1A "Risk Factors" and other parts of this Report.
    We expect our operating results to fluctuate significantly from quarter-to-quarter in the future due to factors such as economic and geopolitical conditions, weather events, cost of aircraft fuel, and various other factors, many of which are outside of our control. Consequently, we believe quarter-over-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 from wage rate cost pressures, as we acquire additional aircraft, and as our fleet ages.
    OVERVIEW
    Third Quarter 2026 Results
    In the third quarter of 2026, we had an operating loss of $144 million and an operating margin of (5.1)%, compared to an operating loss of $100 million and operating margin of (4.3)% in the 2025 period. The increase in operating loss was primarily driven by significantly higher fuel prices, with average fuel price per gallon for the quarter increasing 57.4% year-over-year. Operating results were also impacted by disruptions resulting from severe weather and air traffic control constraints across our core Northeast markets, which reduced completed capacity and increased crew and other operating costs. These pressures were partially offset by higher revenue driven by resilient demand and higher fares. Despite significantly higher fuel prices and operational disruptions, adjusted operating margin (1), a non-GAAP financial measure that excludes special items, improved to (3.9)% in the third quarter of 2026 from (4.1)% in the third quarter of 2025.
    As we progressed through the third quarter of 2026, demand remained resilient across our network despite higher fares, with strength across the booking curve, including peak and off-peak periods. Revenue growth was primarily driven by higher yields, supported in part by improvements in our revenue management technology, while customer volumes remained relatively resilient.
    Our third quarter 2026 highlights include the following:
    •Third quarter 2026 system available seat miles ("ASMs" or "capacity") increased by 2.3% year-over-year.
    •Operating revenue for the third quarter of 2026 was $2.8 billion, a 21.1% increase year-over-year.
    •Operating expense for the third quarter of 2026 was $3.0 billion, a 22.1% increase year-over-year.
    •Operating expense, excluding special items (1) for the third quarter of 2026 was $2.9 billion, a 20.9% increase year-over-year.
    •Operating expense per available seat mile ("CASM") for the third quarter of 2026 increased by 19.4% year-over-year to 17.12 cents compared to the third quarter of 2025.
    •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 7.0% to 11.78 cents in the third quarter of 2026 compared to the third quarter of 2025.
    Recent Developments
    JetForward
    JetForward, our strategic framework, is focused on four priority moves: delivering reliable and caring service, building the best East Coast leisure network, offering products and perks customers value, and providing a secure financial future. Our JetForward plan, which is designed to support our long-term profitability goals, reflects various assumptions regarding factors that may impact our operational and financial performance. For further information on potential factors that could affect the success of our strategic initiatives, including JetForward, see Part I, Item 1A "Risk Factors" within our 2025 Form 10-K.


    (1) Refer to "Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
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    PART I. FINANCIAL INFORMATION
    ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    The sections below highlight some actions made to support these priority moves during the quarter.
    Reliable and Caring Service
    We remain focused on delivering safe, reliable, and caring service for our customers. During the third quarter of 2026, our operations were impacted by a challenging summer operating environment, including severe weather and air traffic control constraints across our core Northeast markets, which reduced completed capacity and increased crew and other operating costs. Throughout these challenges, our crewmembers remained focused on caring for our customers and recovering our operations. We continue to work with the FAA to support longer-term improvements to the air traffic control system aimed at reducing delays.
    Best East Coast Leisure Network
    We are focused on high-performing leisure, visiting-friends-and-relatives and transcontinental routes in core geographies like New York, New England, Florida, and Puerto Rico.
    During the third quarter, we continued executing our strategy to build the best East Coast leisure network. As part of these efforts, we continued expanding our presence in Fort Lauderdale, where customer demand remained strong despite significant capacity growth, with third-quarter revenue per available seat mile ("RASM") increasing nearly 15% year-over-year on more than 65% capacity growth. We continued adding destinations and frequencies to expand travel options and connecting opportunities, with peak daily departures expected to exceed 150 in the fourth quarter of 2026. This performance reinforces our strategy of concentrating growth in markets where we see opportunities to build scale and generate attractive returns.
    Additionally, during the third quarter, we were selected as the successful bidder to acquire 22 operating authorizations (slots) previously operated by Spirit Airlines at New York's LaGuardia Airport. Following receipt of regulatory approval, the Company completed the acquisition in October 2026.
    Products and Perks Customers Value
    During the third quarter of 2026, we continued to enhance our products and services through the expansion of our premium offerings, loyalty program, and strategic partnerships. We also completed the transition to a new revenue management system designed to improve forecasting and optimize revenue across our network, including Mint® and connecting itineraries.
    We continued advancing our Blue Sky collaboration with United Airlines, providing customers with expanded travel options and reciprocal loyalty benefits. Since the partnership launched, TrueBlue® members have redeemed more than 1.1 billion points on United flights. Paisly also continued expanding its travel platform offerings, including car rentals through MileagePlus Travel. Hotels and travel insurance are expected to launch before the end of 2026, followed by flight-and-hotel packages and cruises in the first half of 2027.
    Our loyalty program continued to build momentum during the third quarter, with loyalty revenue increasing approximately 20% year-over-year. Following the refresh of our Premier Card, acquisitions increased more than eightfold year-over-year, while spending across our co-brand portfolio grew double digits. We also continued enhancing our premium customer experience through investments such as the opening of our BlueHouse™ lounge in Boston, creating additional opportunities to deepen customer engagement.
    Additionally, BlueFirst™, our new domestic first-class product and largest JetForward initiative, is now available for sale across more than 30 routes, with service expected to begin in December 2026 between Boston and Fort Lauderdale before expanding to additional routes. The majority of aircraft retrofits are expected to be completed by the end of 2027, with the earnings contribution from the product expected to continue building through 2028 and beyond.
    A Secure Financial Future
    To secure our financial future, we remain focused on preserving liquidity, maintaining cost discipline, and proactively managing our balance sheet.
    During the third quarter, elevated fuel prices and operational disruptions presented additional cost pressures. Geopolitical developments, including continued conflict in the Middle East, contributed to volatility in global energy markets and higher aircraft fuel prices, adversely affecting our operating results. Fuel prices remain subject to significant volatility based on geopolitical developments, global supply and demand, refining capacity, and other factors outside of our control.
            
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    PART I. FINANCIAL INFORMATION
    ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    Against this backdrop, and amid continued macroeconomic uncertainty, we remained focused on managing the factors within our control, including disciplined capacity deployment, commercial initiatives, and cost management. Our JetForward cost initiatives continue to focus on improving operational efficiency and productivity through business partner spend management, improved crew utilization, and technology modernization.
    Additionally, during the third quarter of 2026, the Company satisfied the applicable requirements to access the additional $250 million in financing under its existing aircraft-secured financing agreement, including delivery of the required advance notice. The financing is expected to fund in the fourth quarter of 2026, subject to the completion of customary funding mechanics. We continue to take a disciplined and proactive approach to managing our balance sheet, with a focus on maintaining liquidity and financial flexibility.
    We remain on track to achieve our 2026 JetForward targets and continue to focus on returning to sustained operating profitability in 2027. We also remain focused on disciplined capital investment, with annual capital expenditures expected to remain below $1 billion through the end of the decade. These priorities are intended to support improved profitability, positive free cash flow, and balance sheet strengthening over time.
    Liquidity
    At September 30, 2026, we had $2.2 billion in liquidity, which includes $1.6 billion in unrestricted cash, cash equivalents, and investment securities and our $600 million undrawn Citibank line of credit.
    Pratt & Whitney
    In July 2023, Pratt & Whitney, a division of RTX Corporation, announced the requirement, mandated by the FAA, for removal of certain engines for inspection due to a rare condition involving powdered metal used in the production of certain engine parts on the PW1100G and PW1500G engine types. These engines power our Airbus A321neo and Airbus A220 fleets. The powdered metal affects engines manufactured between October 2015 and September 2021. Those 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 durability deficiencies, as of September 30, 2026, we had two aircraft grounded due to lack of engine availability. The Company currently expects each removed engine to take approximately 170 days for the PW1500G engines and approximately 270 days for the PW1100G engines to complete a shop visit and return to a serviceable condition. We believe we are past the peak number of groundings and expect the number of aircraft on the ground due to lack of engine availability to remain in the single digits for the remainder of 2026.
    On July 27, 2026, we entered into supplemental support and other agreements with International Aero Engines, LLC ("IAE"), an affiliate of RTX Corporation, Pratt & Whitney Division, related to certain PW1100G and PW1500G engine operational disruptions, technical issues occurring through December 31, 2025 and other matters. Under the agreements, we received consideration including credits up to $105 million that may be applied toward future purchases of qualifying goods and services from IAE, IAE International Aero Engines AG and Pratt & Whitney through December 31, 2027, including in exchange for waiving certain claims.
    These credits are accounted for as vendor consideration under ASC 705-20 and are allocated to qualifying purchases through December 31, 2027 based on our estimated eligible spend for applicable goods and services during that period. Credits associated with operating expenditures are recognized as reductions of the related operating expenses, while credits associated with capital expenditures are recognized as reductions of the cost basis of the related assets.
    Embraer E190 Fleet Transition
    In 2025, as part of the Company's fleet transition plan, we retired our remaining Embraer E190 aircraft and entered into definitive agreements to sell the remaining E190 fleet. During the nine months ended September 30, 2026, we completed the sale of our remaining owned Embraer E190 airframes and engines and continued to sell related spare parts, and recorded a net gain of $28 million, which is included in other operating expenses in our consolidated statements of operations. We also returned our remaining leased E190 aircraft.


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    PART I. FINANCIAL INFORMATION
    ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    RESULTS OF OPERATIONS
    Three Months Ended September 30, 2026 vs. 2025
    Overview
    We reported a net loss of $257 million, operating loss of $144 million and an operating margin of (5.1)% for the three months ended September 30, 2026. This compares to a net loss of $143 million, an operating loss of $100 million and an operating margin of (4.3)% for the three months ended September 30, 2025. Our loss per share was $0.68 for the third quarter of 2026 compared to a loss per share of $0.39 for the same period in 2025. Net loss increased $114 million year-over-year primarily due to elevated fuel prices as well as higher salaries, wages and benefits, largely attributable to operational disruptions, as well as a lower current year income tax benefit. The increases in expense were partially offset by higher revenue driven by stronger demand and higher fares.
    Our reported results for the three months ended September 30, 2026 and 2025 included the effects of special items and certain gains on investments. Adjusting for these items, our adjusted net loss (1) was $226 million, adjusted operating loss (1) was $111 million, adjusted operating margin (1) was (3.9)%, and adjusted loss per share (1) was $0.60 for the three months ended September 30, 2026. This compares to an adjusted net loss (1) of $144 million, adjusted operating loss (1) of $95 million, adjusted operating margin (1) of (4.1)%, and adjusted loss per share (1) of $0.40 for the three months ended September 30, 2025.

    Operating Revenues
    (Revenues in millions; percent changes based on unrounded numbers)Three Months Ended September 30,Year-over-Year Change
    20262025$%
    Passenger revenue$2,600 $2,135 $465 21.8 %
    Other revenue212 187 25 13.4 
    Total operating revenues$2,812 $2,322 $490 21.1 %
    Average fare$245.11 $205.67 $39.44 19.2 %
    Yield per passenger mile (cents)18.01 14.86 3.15 21.2 
    Passenger revenue per ASM (cents)15.06 12.65 2.41 19.1 
    Operating revenue per ASM (cents)16.28 13.75 2.53 18.4 
    Average stage length (miles)1,289 1,317 (28)(2.1)
    Revenue passengers (thousands)10,607 10,381 226 2.2 
    Revenue passenger miles (millions)14,439 14,372 67 0.5 
    Available seat miles (ASMs) (millions)17,268 16,884 384 2.3 
    Load factor83.6 %85.1 %(1.5)pts.
    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 EvenMore®. Passenger revenue increased 21.8% for the three months ended September 30, 2026 compared to the same period in 2025. This was mainly driven by a 21.2% higher yield and a 2.2% increase in revenue passengers compared to the prior period.
    Other revenue increased $25 million, or 13.4%, primarily due to higher customer spend related to loyalty revenue from the non-transportation elements of the sale of TrueBlue® points. Other revenue also includes revenue from the sale of vacation packages, airport concessions, charters, advertising, and lounge revenue.
    We measure capacity in terms of available seat miles, which represents the number of seats available for passengers multiplied by the number of miles the seats are flown. Yield, or the average amount one passenger pays to fly one mile, is calculated by dividing passenger revenue by revenue passenger miles. We attempt to increase passenger revenue by increasing our yield and also increasing our load factor of flights, when possible. Our objective is to optimize our fare mix to increase our overall revenue per available seat mile while continuing to provide our customers with competitive fares.
    (1) Refer to "Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
    27
    PART I. FINANCIAL INFORMATION
    ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    Operating Expenses
    In detail, our operating costs per ASM, were as follows:
    (in millions; per ASM data in cents; percent changes based on unrounded numbers)Three Months Ended September 30,Year-over-Year ChangeCents per ASM
    20262025$%20262025% Change
    Aircraft fuel$868 $539 $329 61.0 %5.03 3.19 57.5 %
    Salaries, wages and benefits946 865 81 9.4 5.48 5.12 6.9 
    Landing fees and other rents199 179 20 11.1 1.15 1.06 8.7 
    Depreciation and amortization186 173 13 7.4 1.08 1.03 5.1 
    Aircraft rent19 21 (2)(8.3)0.11 0.12 (10.4)
    Sales and marketing92 78 14 17.2 0.53 0.46 14.5 
    Maintenance, materials and repairs204 210 (6)(2.3)1.18 1.24 (4.5)
    Special items33 5 28 
    NM (1)
    		0.19 0.03 NM
    Other operating expenses409 352 57 15.9 2.37 2.09 13.4 
    Total operating expenses$2,956 $2,422 $534 22.1 %17.12 14.34 19.4 %
    (1) Not meaningful or greater than 100% change.
    Aircraft Fuel
    Aircraft fuel increased by $329 million, or 61.0%, for the three months ended September 30, 2026 compared to the same period in 2025. The average fuel price increased by 57.4% to $3.91 per gallon and fuel consumption increased by 2.3%, or 5 million gallons.
    Salaries, wages and benefits
    Salaries, wages and benefits increased by $81 million or 9.4%, for the three months ended September 30, 2026 compared to the same period in 2025, primarily driven by higher overtime and incentive pay due to operational disruptions as well as pay rate increases.
    Landing Fees and Other Rents
    Landing fees and other rents increased by $20 million, or 11.1%, for the three months ended September 30, 2026 compared to the same period in 2025, primarily due to rate increases in certain cities.
    Depreciation and Amortization
    Depreciation and amortization increased by $13 million, or 7.4%, for the three months ended September 30, 2026 compared to the same period in 2025. This increase was primarily driven by the induction of new aircraft and spare engines, partially offset by the retirement of the Embraer E190 fleet as part of the Company's fleet transition plan.
    Aircraft Rent
    Aircraft rent decreased by $2 million, or 8.3%, in the three months ended September 30, 2026 compared to the same period in 2025, primarily due to fewer leases for Airbus A320 aircraft and Embraer E190 aircraft. As part of the Company's fleet transition plan, Embraer E190 aircraft leases reached their lease expiration and were returned to the lessor. The decrease was partially offset by an increase in the number of leased engines.
    Sales and Marketing
    Sales and marketing increased by $14 million, or 17.2%, in the three months ended September 30, 2026 compared to the same period in 2025, primarily due to higher credit card fees as a result of the increase in passenger revenue.

    28
    PART I. FINANCIAL INFORMATION
    ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    Special Items
    For the three months ended September 30, 2026, special items consisted of a $33 million adjustment to litigation reserves. For the three months ended September 30, 2025, special items consisted of $3 million relating to severance expenses and $2 million relating to other special items.
    Other Operating Expenses
    Other operating expenses increased by $57 million, or 15.9%, in the three months ended September 30, 2026 compared to the same period in 2025. The increase was driven by lower net gains on asset sale transactions, primarily related to E190 aircraft and engine sales, as well as higher airport-related costs due to contractual rate increases and network changes. The increase also reflects higher costs associated with operational disruption events.

    Other Income (Expense)
    (in millions; percent changes based on unrounded numbers)Three Months Ended September 30,Year-over-Year Change
    20262025$%
    Interest expense$(149)$(146)$(3)2.3 %
    Interest income17 30 (13)(45.4)
    Capitalized interest1 2 (1)(32.0)
    Gain on investments, net— 8 (8)(94.3)
    Other5 10 (5)(53.2)
    Total other expense$(126)$(96)$(30)32.2 %
    Interest Income
    Interest income decreased by $13 million, or 45.4%, for the three months ended September 30, 2026 compared to the same period in 2025, driven by lower short-term investment balances.
    Gain on investments, net
    Gain on investments, net decreased by $8 million for the three months ended September 30, 2026, compared to the same period in 2025, primarily due to lower current year realized gains from maturities of available-for-sale securities.
    Other
    Other income decreased by $5 million, or 53.2%, for the three months ended September 30, 2026 compared to the same period in 2025. This decrease was primarily due to lower income recorded related to our share of equity method investees' financial results compared to the prior year.
    Income Taxes
    For the three months ended September 30, 2026, we recorded an income tax benefit of $13 million, compared to an income tax benefit of $53 million for the same period in 2025, with the decrease primarily due to a valuation allowance included in our forecasted annual effective tax rate that offsets most of the income tax benefit for the current period.

    29
    PART I. FINANCIAL INFORMATION
    ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    RESULTS OF OPERATIONS
    Nine Months Ended September 30, 2026 vs. 2025
    Overview
    We reported a net loss of $823 million, an operating loss of $509 million and an operating margin of (6.6)% for the nine months ended September 30, 2026. This compares to a net loss of $425 million, an operating loss of $268 million and an operating margin of (3.9)% for the nine months ended September 30, 2025. Our loss per share was $2.20 for the nine months ended September 30, 2026 compared to a loss per share of $1.18 for the same period in 2025. Net loss increased $398 million year-over-year primarily due to an increase in fuel expense and higher salaries, wages and benefits and other operating expenses, largely attributable to operational disruption events during the year, lower current year net gains related to asset sale transactions, as well as a lower current year income tax benefit. The increases in expense were partially offset by higher revenue driven by stronger demand and higher fares.
    Our reported results for the nine months ended September 30, 2026 and 2025 included the effects of special items and certain gains on investments. Adjusting for these items, our adjusted net loss (1) was $795 million, adjusted operating loss (1) was $476 million, adjusted operating margin (1) was (6.1)%, and adjusted loss per share (1) was $2.12 for the nine months ended September 30, 2026. This compares to an adjusted net loss (1) of $412 million, adjusted operating loss (1) of $239 million, adjusted operating margin (1) of (3.5)%, and adjusted loss per share (1) of $1.15 for the nine months ended September 30, 2025.
    Operating Revenues
    (Revenues in millions; percent changes based on unrounded numbers)Nine Months Ended September 30,Year-over-Year Change
    20262025$%
    Passenger revenue$7,135 $6,284 $851 13.6 %
    Other revenue614 534 80 14.8 
    Total operating revenues$7,749 $6,818 $931 13.7 %
    Average fare$234.59 $212.16 $22.43 10.6 %
    Yield per passenger mile (cents)17.30 15.48 1.82 11.8 
    Passenger revenue per ASM (cents)14.33 12.79 1.54 12.1 
    Operating revenue per ASM (cents)15.57 13.88 1.69 12.2 
    Average stage length (miles)1,298 1,308 (10)(0.8)
    Revenue passengers (thousands)30,416 29,618 798 2.7 
    Revenue passenger miles (millions)41,237 40,600 637 1.6 
    Available seat miles (ASMs) (millions)49,778 49,126 652 1.3 
    Load factor82.8 %82.6 %0.2 pts.
    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 EvenMore®. Passenger revenue increased 13.6% for the nine months ended September 30, 2026 compared to the same period in 2025. This was mainly driven by a 11.8% higher yield and a 2.7% increase in revenue passengers compared to the prior period.
    Other revenue increased $80 million, or 14.8%, primarily due to higher customer spend related to loyalty revenue from the non-transportation elements of the sale of TrueBlue® points. Other revenue also includes revenue from the sale of vacation packages, airport concessions, charters, advertising, and lounge revenue.
    We measure capacity in terms of available seat miles, which represents the number of seats available for passengers multiplied by the number of miles the seats are flown. Yield, or the average amount one passenger pays to fly one mile, is calculated by dividing passenger revenue by revenue passenger miles. We attempt to increase passenger revenue by increasing our yield and also increasing our load factor of flights, when possible. Our objective is to optimize our fare mix to increase our overall revenue per available seat mile while continuing to provide our customers with competitive fares.
    (1) Refer to "Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
    30
    PART I. FINANCIAL INFORMATION
    ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    Operating Expenses
    In detail, our operating costs per ASM, were as follows:
    (in millions; per ASM data in cents; percent changes based on unrounded numbers)Nine Months Ended September 30,Year-over-Year ChangeCents per ASM
    20262025$%20262025% Change
    Aircraft fuel $2,352 $1,554 $798 51.4 %4.73 3.16 49.4 %
    Salaries, wages and benefits2,717 2,579 138 5.3 5.46 5.24 4.0 
    Landing fees and other rents551 509 42 8.2 1.10 1.04 6.8 
    Depreciation and amortization548 512 36 6.9 1.10 1.04 5.5 
    Aircraft rent49 60 (11)

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    holders ( registered funds via N-PORT, institutional investors via 13F). Showing top by dollar value.

    Holder Type ETF MF Position ($) % of holder Δ % of holder Holder AUM

    Recent insider activity

    Last 90 days. Open-market trades (purchases & sales) by directors, officers, and 10%+ owners. 5 transactions across 3 insiders. Net: +194,000 shares, $599,924.

    Date Insider Role Action Shares Price Value
    2026-11-03 Mittal Nik Director Buy +100,000 ×2 $3.24 $323,844
    2026-10-30 Clements Carol Ann Chief Digital & Tech Officer Sell -2,000 $2.96 -$5,920
    2026-10-29 BONEPARTH PETER Director Buy +100,000 $3.00 $300,000
    2026-09-30 Clements Carol Ann Chief Digital & Tech Officer Sell -2,000 $4.29 -$8,580
    2026-08-31 Clements Carol Ann Chief Digital & Tech Officer Sell -2,000 $4.71 -$9,420

    Source: SEC Form 4 filings.

    Next expected filings

    • ~2027-02-13 10-K expected by 2027-02-26 (in 90 days)
    • ~2027-04-27 10-Q expected by 2027-05-09 (in 163 days)
    • ~2027-07-27 10-Q expected by 2027-08-08 (in 254 days)
    • ~2027-10-25 10-Q expected by 2027-11-06 (in 344 days)

    Predicted from historical filing cadence; not an SEC commitment.

    Recent SEC filings

    • 2026-10-26 8-K Earnings Release; Regulation FD Disclosure; Financial Statements and Exhibits
    • 2026-10-26 10-Q Quarterly Report
    • 2026-08-27 8-K Officer/Director Change; Financial Statements and Exhibits
    • 2026-07-31 S-8 Employee Benefit Plan Registration
    • 2026-07-28 10-Q Quarterly Report
    • 2026-07-28 8-K Earnings Release; Regulation FD Disclosure; Financial Statements and Exhibits
    • 2026-04-28 8-K Earnings Release; Regulation FD Disclosure; Financial Statements and Exhibits
    • 2026-04-28 10-Q Quarterly Report
    • 2026-04-17 8-K Other Events
    • 2026-02-12 10-K Annual Report
    • 2026-01-27 8-K Earnings Release; Regulation FD Disclosure; Financial Statements and Exhibits
    • 2025-10-28 10-Q Quarterly Report
    • 2025-10-28 8-K Earnings Release; Regulation FD Disclosure; Financial Statements and Exhibits
    • 2025-07-29 10-Q Quarterly Report
    • 2025-07-29 8-K Earnings Release; Regulation FD Disclosure; Financial Statements and Exhibits