Core Insights - Allegiant Travel Company announced five new nonstop routes connecting eight cities, including Huntsville, Alabama, with one-way fares starting at $39 to celebrate the launch [1][7] - The new routes aim to enhance Allegiant's presence in popular leisure destinations, catering to travelers seeking budget-friendly options [1][2] - The airline's business model focuses on connecting underserved markets to top vacation destinations, allowing for quick responses to consumer demand [2] Route Details - New route from Orlando, Florida (MCO) to Appleton, Wisconsin (ATW) starts January 16, 2026, with one-way fares as low as $69 [3] - New route from Sarasota/Bradenton, Florida (SRQ) to Rochester, New York (ROC) begins February 13, 2026, with one-way fares starting at $59 [3] - Additional routes include Fort Lauderdale, Florida (FLL) starting November 19, 2025, and St. Petersburg, Florida (PIE) beginning March 5, 2026, both with one-way fares as low as $39 [7] Business Model and Strategy - Allegiant's all-nonstop flight network enhances travel convenience, allowing passengers to spend less time at the airport [4] - The company has extended its flight schedule through May 2026, enabling travelers to plan vacations in advance [3] - Allegiant's average base airfares are less than half the cost of the average domestic roundtrip ticket, emphasizing its focus on affordability [6]

Core Insights - Allegiant Travel Company (ALGT) reported Q2 2025 earnings of $1.23 per share, exceeding the Zacks Consensus Estimate of 83 cents, but reflecting a 30.5% decline year-over-year [1][9] - Operating revenues reached $689.4 million, slightly below the Zacks Consensus Estimate of $698.4 million, yet showing a 3.5% year-over-year improvement [1][9] Revenue Performance - Passenger revenues, which constituted 89.6% of total revenues, increased by 3.9% year-over-year [2] - Air traffic, measured in revenue passenger miles, grew by 12% year-over-year, while capacity, measured in available seat miles (ASMs), increased by 16.1% [2] - The load factor decreased to 81.9% from 84.7% year-over-year, indicating that traffic did not keep pace with capacity growth [2] Cost Analysis - Operating costs per available seat mile, excluding fuel, decreased by 2.5% year-over-year to 8.29 cents [3] - The average fuel cost per gallon for scheduled services fell by 22.2% year-over-year to $2.49 [3] - Total scheduled service passenger revenue per available seat mile declined to 13.01 cents from 13.16 cents a year ago [3] Liquidity Position - As of June 30, 2025, Allegiant's total unrestricted cash and investments amounted to $852.7 million, down from $906.3 million in the previous quarter [5] - Long-term debt and finance lease obligations totaled $1.77 billion, slightly up from $1.74 billion in the prior quarter [5] Future Guidance - For Q3 2025, scheduled service ASMs are expected to increase by 10% year-over-year, with total system ASMs projected to rise by 9% [6] - Adjusted loss per share for the airline is anticipated to be in the range of $1.25 to $2.25, while the consolidated loss per share is expected between $1.75 and $2.75 [6] - For the full year 2025, scheduled service ASMs are projected to increase by 13% year-over-year, with adjusted EPS expected to exceed $2.25 [7] Capital Expenditures - Aircraft-related capital expenditures are expected to be in the range of $260-$280 million, with additional capitalized deferred heavy maintenance between $50 million and $70 million [8] - The company aims to expand its fleet size to 122 by the end of Q3 2025 [8]

PART I. FINANCIAL INFORMATION [ITEM 1. Consolidated Financial Statements](index=4&type=section&id=ITEM%201.%20Consolidated%20Financial%20Statements) Presents unaudited consolidated financial statements, including balance sheets, income, equity, cash flows, and detailed accounting notes [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets) Total assets decreased to **$4,389.141 million** by June 30, 2025, due to cash, investment, and Sunseeker Resort reclassification changes Consolidated Balance Sheets (in thousands) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **CURRENT ASSETS** | | | | Cash and cash equivalents | $209,873 | $285,892 | | Short-term investments | 632,946 | 495,234 | | Assets held for sale | 194,650 | — | | **TOTAL CURRENT ASSETS** | **1,206,750** | **991,605** | | Property and equipment, net | 2,892,648 | 3,069,949 | | **TOTAL ASSETS** | **$4,389,141** | **$4,429,853** | | **CURRENT LIABILITIES** | | | | Current maturities of long-term debt and finance lease obligations | 183,063 | 454,769 | | **TOTAL CURRENT LIABILITIES** | **1,093,656** | **1,277,404** | | Long-term debt and finance lease obligations, net | 1,778,855 | 1,611,735 | | **TOTAL LIABILITIES** | **$3,333,220** | **$3,340,461** | | **TOTAL EQUITY** | **1,055,921** | **$1,089,392** | | **TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY** | **$4,389,141** | **$4,429,853** | [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income) Net loss reported for Q2 and H1 2025, driven by significant special charges from Sunseeker write-down and corporate restructuring Consolidated Statements of Income (in thousands, except per share amounts) | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **OPERATING REVENUES:** | | | | | | Total operating revenues | $689,384 | $666,283 | $1,388,458 | $1,322,688 | | **OPERATING EXPENSES:** | | | | | | Total operating expenses | 756,873 | 631,386 | 1,390,945 | 1,272,344 | | **OPERATING INCOME (LOSS)** | **(67,489)** | **34,897** | **(2,487)** | **50,344** | | **INCOME (LOSS) BEFORE INCOME TAXES** | **(88,564)** | **18,025** | **(46,624)** | **16,688** | | INCOME TAX PROVISION (BENEFIT) | (23,398) | 4,326 | (13,560) | 3,908 | | **NET INCOME (LOSS)** | **$(65,166)** | **$13,699** | **$(33,064)** | **$12,780** | | Earnings (loss) per share: Basic | $(3.62) | $0.75 | $(1.84) | $0.69 | | Earnings (loss) per share: Diluted | $(3.62) | $0.75 | $(1.84) | $0.68 | [Consolidated Statements of Comprehensive Income](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Total comprehensive loss widened significantly in Q2 and H1 2025, reflecting the net loss, partially offset by securities changes Consolidated Statements of Comprehensive Income (in thousands) | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | NET INCOME (LOSS) | $(65,166) | $13,699 | $(33,064) | $12,780 | | Other comprehensive income (loss): Change in available for sale securities, net of tax | 305 | (254) | (505) | (1,462) | | **TOTAL COMPREHENSIVE INCOME (LOSS)** | **$(64,861)** | **$13,445** | **$(33,569)** | **$11,318** | [Consolidated Statements of Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity) Shareholders' equity decreased to **$1,055.921 million** by June 30, 2025, due to net loss and share repurchases Consolidated Statements of Shareholders' Equity (in thousands) | | Balance at December 31, 2024 | Share-based compensation | Shares repurchased | Stock issued under employee stock purchase plan | Other comprehensive loss | Net loss | Balance at June 30, 2025 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Total shareholders' equity** | **$1,089,392** | **$6,302** | **$(11,470)** | **$5,266** | **$(505)** | **$(33,064)** | **$1,055,921** | [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow increased to **$283.647 million** in H1 2025, but investing and financing outflows led to a net cash decrease Consolidated Statements of Cash Flows (in thousands) | | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net income (loss) | $(33,064) | $12,780 | | Net cash provided by operating activities | 283,647 | 236,737 | | Net cash used in investing activities | (241,842) | (109,752) | | Net cash used in financing activities | (116,223) | (54,432) | | **NET CHANGE IN CASH, CASH EQUIVALENTS, AND RESTRICTED CASH** | **(74,418)** | **72,553** | | CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT BEGINNING OF PERIOD | 302,319 | 159,584 | | **CASH, CASH EQUIVALENTS, AND RESTRICTED CASH AT END OF PERIOD** | **$227,901** | **$232,137** | [Notes to Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Detailed notes explain accounting policies, special charges, revenue, debt, income taxes, fair value, EPS, contingencies, segments, and Sunseeker sale [Note 1 — Summary of Significant Accounting Policies](index=10&type=section&id=Note%201%20%E2%80%94%20Summary%20of%20Significant%20Accounting%20Policies) Unaudited financial statements follow U.S. GAAP, relying on management estimates, with reclassifications for presentation conformity - Unaudited consolidated financial statements include Allegiant Travel Company and its majority-owned subsidiaries, with all intercompany balances and transactions eliminated[18](index=18&type=chunk) - The preparation of financial statements requires management to make estimates and assumptions that affect reported amounts, and actual results may differ from these estimates[20](index=20&type=chunk) - Certain prior period amounts have been reclassified to conform to the current period presentation[21](index=21&type=chunk) [Note 2 — Special Charges](index=10&type=section&id=Note%202%20%E2%80%94%20Special%20Charges) Q2 2025 special charges totaled **$117.9 million**, mainly from Sunseeker write-down and corporate restructuring - In Q2 2025, the Company recorded **$102.2 million** in special charges related to the pending sale of Sunseeker Resort, including a **$100.4 million** write-down and **$1.8 million** for retention pay[22](index=22&type=chunk) - The Company recorded **$12.1 million** of special charges in Q2 2025 for corporate restructuring efforts, including voluntary separation packages and termination of marketing agreements, in response to softened air travel demand[26](index=26&type=chunk) Summary of Special Charges (in thousands) | (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Accelerated depreciation on airframes identified for early retirement | $2,501 | $9,251 | $3,892 | $24,166 | | Flight attendant ratification bonus | — | 10,821 | — | 10,821 | | Organizational restructuring | 12,095 | — | 12,095 | — | | Airline special charges | 14,596 | 20,072 | 15,987 | 34,987 | | Sunseeker special charges, net of insurance recoveries | 103,328 | (1,958) | 100,382 | (3,775) | | **Total special charges** | **$117,924** | **$18,114** | **$116,369** | **$31,212** | [Note 3 — Revenue Recognition](index=11&type=section&id=Note%203%20%E2%80%94%20Revenue%20Recognition) Passenger revenue increased in Q2 and H1 2025, driven by ancillary charges and loyalty, while resort revenue also grew Passenger Revenue (in thousands) | (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Scheduled service | $247,208 | $272,715 | $530,576 | $562,594 | | Ancillary air-related charges | 352,873 | 307,390 | 668,152 | 582,183 | | Loyalty redemptions | 17,827 | 14,394 | 35,930 | 29,657 | | **Total passenger revenue** | **$617,908** | **$594,499** | **$1,234,658** | **$1,174,434** | Resort Revenue (in thousands) | (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Rooms | $8,732 | $6,653 | $24,163 | $16,610 | | Food and beverage | 7,766 | 7,643 | 17,728 | 18,415 | | Other | 4,136 | 2,515 | 9,431 | 5,673 | | **Total resort revenue** | **$20,634** | **$16,811** | **$51,322** | **$40,698** | - As of June 30, 2025, the air traffic liability balance was **$363.5 million**, with approximately **$322.9 million** related to forward bookings and **$40.6 million** to credit vouchers[29](index=29&type=chunk) [Note 4 — Property and Equipment](index=12&type=section&id=Note%204%20%E2%80%94%20Property%20and%20Equipment) Net property and equipment decreased to **$2,892.648 million** by June 30, 2025, due to Sunseeker Resort asset reclassification Property and Equipment, Net (in thousands) | (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Airline Flight equipment | $3,487,636 | $3,345,458 | | Sunseeker Resort Land and buildings/leasehold improvements | — | 255,201 | | **Total property and equipment, net** | **$2,892,648** | **$3,069,949** | - As of June 30, 2025, all assets related to Sunseeker Resort and Aileron Golf Course are presented as 'Assets held for sale' on the balance sheet due to a pending sale agreement[35](index=35&type=chunk) - The Company had firm commitments to purchase **37 aircraft** as of June 30, 2025[35](index=35&type=chunk) [Note 5 — Long-Term Debt](index=13&type=section&id=Note%205%20%E2%80%94%20Long-Term%20Debt) Long-term debt decreased to **$1,961.918 million** by June 30, 2025, with new aircraft debt offset by significant principal repayments Long-Term Debt and Finance Lease Obligations (in thousands) | (in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Fixed-rate debt and finance lease obligations due through 2032 | $1,336,800 | $1,481,186 | | Variable-rate debt due through 2037 | 625,118 | 585,318 | | **Total long-term debt and finance lease obligations, net of related costs** | **1,961,918** | **2,066,504** | | Less current maturities, net of related costs | 183,063 | 454,769 | | **Long-term debt and finance lease obligations, net of current maturities and related costs** | **$1,778,855** | **$1,611,735** | - During the six months ended June 30, 2025, the Company borrowed **$218.5 million** under credit agreements for new aircraft and drew down **$55.3 million** from a new **$221.3 million** facility[38](index=38&type=chunk)[39](index=39&type=chunk) - The Company fully repaid the **$100.0 million** Sunseeker construction loan in February 2025 and the **$130.5 million** unsecured credit facility during the six months ended June 30, 2025[43](index=43&type=chunk)[45](index=45&type=chunk) - As of June 30, 2025, the Company had **$275.0 million** available under revolving credit facilities and **$335.0 million** in undrawn aircraft and pre-delivery deposit financing commitments[46](index=46&type=chunk) [Note 6 — Income Taxes](index=14&type=section&id=Note%206%20%E2%80%94%20Income%20Taxes) Income tax benefit recorded in Q2 and H1 2025, with effective tax rate differing from statutory due to state taxes and Sunseeker write-down - For the three months ended June 30, 2025, the Company recorded a **$23.4 million** income tax benefit at a **26.4%** effective tax rate, compared to a **$4.3 million** income tax expense at **24.0%** in 2024[47](index=47&type=chunk) - For the six months ended June 30, 2025, the Company recorded a **$13.6 million** income tax benefit at a **29.1%** effective tax rate, compared to a **$3.9 million** income tax expense at **23.4%** in 2024[48](index=48&type=chunk) - The effective tax rate for both periods in 2025 differed from the statutory federal income tax rate of **21.0%** primarily due to state income taxes, permanent tax differences, and discrete items, mainly the Sunseeker write-down[47](index=47&type=chunk)[48](index=48&type=chunk) [Note 7 — Fair Value Measurements](index=14&type=section&id=Note%207%20%E2%80%94%20Fair%20Value%20Measurements) Financial assets are measured at fair value using market approach (Level 2), while long-term debt uses discounted cash flow (Level 3) - The Company utilizes the market approach to measure the fair value of its financial assets, with Level 2 assets primarily using quoted market prices or models with market observable inputs[49](index=49&type=chunk) - The estimated fair value of long-term debt is determined using the discounted cash flow method and classified as Level 3, as certain inputs are unobservable[50](index=50&type=chunk) Financial Instruments Measured at Fair Value (in thousands) | (in thousands) | As of June 30, 2025 Total | As of June 30, 2025 Level 1 | As of June 30, 2025 Level 2 | As of December 31, 2024 Total | As of December 31, 2024 Level 1 | As of December 31, 2024 Level 2 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Cash equivalents:** | | | | | | | | Money market funds | $45,979 | $45,979 | $— | $41,494 | $41,494 | $— | | Commercial paper | 18,527 | — | 18,527 | 22,689 | — | 22,689 | | US Government and agency obligations | 17,992 | — | 17,992 | 81,535 | — | 81,535 | | **Total cash equivalents** | **94,012** | **45,979** | **48,033** | **160,150** | **41,494** | **118,656** | | **Short-term investments:** | | | | | | | | Corporate debt securities | 304,380 | — | 304,380 | 242,313 | — | 242,313 | | Commercial paper | 217,224 | — | 217,224 | 149,807 | — | 149,807 | | US Government and agency obligations | 99,939 | — | 99,939 | 94,295 | — | 94,295 | | **Total short-term investments** | **632,946** | **—** | **632,946** | **495,234** | **—** | **495,234** | | **Long-term investments:** | | | | | | | | US Government and agency obligations | 5,257 | — | 5,257 | 10,452 | — | 10,452 | | Corporate debt securities | 4,674 | — | 4,674 | 39,931 | — | 39,931 | | **Total long-term investments** | **9,931** | **—** | **9,931** | **51,725** | **—** | **51,725** | | **Total financial instruments** | **$736,889** | **$45,979** | **$690,910** | **$707,109** | **$41,494** | **$665,615** | [Note 8 — Earnings per Share](index=15&type=section&id=Note%208%20%E2%80%94%20Earnings%20per%20Share) Basic and diluted loss per share of **$(3.62)** and **$(1.84)** reported for Q2 and H1 2025, a significant decline from prior year - Basic and diluted earnings per share are computed using the two-class method, with unvested restricted stock awards considered participating securities[52](index=52&type=chunk) Earnings (Loss) Per Share (in thousands, except per share amounts) | (in thousands, except per share amounts) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Basic:** | | | | | | Net income (loss) attributable to common stock | $(65,166) | $13,366 | $(33,064) | $12,162 | | Earnings (loss) per share, basic | $(3.62) | $0.75 | $(1.84) | $0.69 | | Weighted-average shares outstanding | 17,995 | 17,828 | 17,989 | 17,746 | | **Diluted:** | | | | | | Net income (loss) attributable to common stock | $(65,166) | $13,366 | $(33,064) | $12,162 | | Earnings (loss) per share, diluted | $(3.62) | $0.75 | $(1.84) | $0.68 | | Adjusted weighted-average shares outstanding under two-class method | 17,995 | 17,869 | 17,989 | 17,836 | [Note 9 — Contingencies](index=16&type=section&id=Note%209%20%E2%80%94%20Contingencies) Routine legal and administrative actions are not expected to materially impact financial position, liquidity, or operations - The Company is subject to certain legal and administrative actions considered routine to its business activities[55](index=55&type=chunk) - Management believes the ultimate outcome of any potential and pending legal or administrative matters will not have a material adverse impact on its financial position, liquidity, or results of operations[55](index=55&type=chunk) [Note 10 — Segments](index=16&type=section&id=Note%2010%20%E2%80%94%20Segments) Operates Airline (profitable) and Sunseeker Resort (significant operating loss due to sale-related special charges) segments - The Company's two operating segments are Airline and Sunseeker Resort, with performance evaluated by the President and CEO based on operating income and pretax income[56](index=56&type=chunk) - The Airline segment includes scheduled service air transportation, ancillary air-related products, third-party products, and fixed-fee contract air transportation[57](index=57&type=chunk) - The Sunseeker Resort segment includes hotel rooms, group meeting facilities, food and beverage options, Aileron Golf Course, and other Resort amenities[58](index=58&type=chunk) Segment Operating Income (Loss) (in thousands) | (in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Airline Operating Income (Loss) | $43,157 | $46,956 | $104,009 | $71,172 | | Sunseeker Operating Income (Loss) | $(110,646) | $(12,059) | $(106,496) | $(20,828) | | **Consolidated Operating Income (Loss)** | **$(67,489)** | **$34,897** | **$(2,487)** | **$50,344** | [Note 11 — Sale of Sunseeker Resort](index=19&type=section&id=Note%2011%20%E2%80%94%20Sale%20of%20Sunseeker%20Resort) Agreement to sell Sunseeker Resort for **$200 million** led to a **$100.4 million** Q2 2025 write-down and 'held for sale' reclassification - In June 2025, the Company's board approved a plan for the sale of Sunseeker Resort and related Aileron Golf Course, meeting held-for-sale accounting requirements[63](index=63&type=chunk) - On July 3, 2025, the Company entered into an Agreement of Purchase and Sale for substantially all Resort assets for approximately **$200 million**, with closing anticipated in September 2025[64](index=64&type=chunk) - A **$100.4 million** write-down charge was recorded in Q2 2025 to reduce the Resort's carrying value to fair value less costs to sell, and its assets and liabilities were reclassified as 'held for sale'[65](index=65&type=chunk) Sunseeker Resort Assets and Liabilities Held for Sale (in thousands) | (in thousands) | As of June 30, 2025 | | :--- | :--- | | **Assets:** | | | Accounts receivable | $2,552 | | Inventories, net | 1,372 | | Prepaid expenses and other current assets | 5,260 | | Property and equipment, net | 284,587 | | Deposits and other assets | 1,290 | | Valuation allowance | (100,411) | | **Assets held for sale** | **$194,650** | | **Liabilities:** | | | Accrued liabilities | $5,355 | | Other noncurrent liabilities | 1,960 | | **Liabilities held for sale** | **$7,315** | [Note 12 — Subsequent Events](index=20&type=section&id=Note%2012%20%E2%80%94%20Subsequent%20Events) Post-June 30, 2025, Sunseeker Resort sale finalized, and **$210.1 million** borrowed for aircraft and debt prepayment - On July 3, 2025, the Company and its Sunseeker subsidiaries entered into an Agreement of Purchase and Sale with affiliates of Blackstone Real Estate Group for the sale of Sunseeker Resort Charlotte Harbor[66](index=66&type=chunk) - In July 2025, the Company borrowed **$210.1 million** on previously reported but undrawn credit facilities, collateralized by aircraft assets, to finance aircraft deliveries and prepay other outstanding debt[67](index=67&type=chunk) [ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=ITEM%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 and H1 2025 financial performance, condition, liquidity, capital, and trends, including Sunseeker sale impact [Second Quarter 2025 Review](index=21&type=section&id=Second%20Quarter%202025%20Review) Q2 2025 revenue grew **3.5%** to **$689.4 million**, but Sunseeker write-down caused a **$67.5 million** operating loss; airline operations were profitable - Total consolidated operating revenue was **$689.4 million**, up **3.5%** year-over-year, on capacity growth of **15.7%**[73](index=73&type=chunk) - The Company reported an operating loss of **$67.5 million** and a loss before income tax of **$88.6 million**, primarily due to the Sunseeker write-down charge[73](index=73&type=chunk) - Airline-only operating income was **$43.2 million**, yielding an airline-only operating margin of **6.5%**[73](index=73&type=chunk) - Airline-only operating cost per available seat mile (CASM), excluding fuel and special charges, decreased **6.7%** year-over-year to **7.68 ¢**[73](index=73&type=chunk) - In early July 2025, the Company entered into a contract to sell Sunseeker Resort and related properties for **$200.0 million**, with the transaction scheduled to close in September 2025[73](index=73&type=chunk) [Trends](index=22&type=section&id=Trends) Softened air travel demand, volatile fuel costs, ongoing pilot negotiations, and the pending Sunseeker sale are key operational trends - Consumer confidence fluctuations and macroeconomic uncertainty have contributed to softened demand for domestic leisure air travel, impacting fares, load factors, and profitability[77](index=77&type=chunk) - Aircraft fuel costs remain volatile, influenced by economic and geopolitical factors, and the Company does not use financial derivative products to hedge against fuel price volatility[78](index=78&type=chunk)[79](index=79&type=chunk) - The Company is focusing on increasing peak period aircraft utilization to 2019 levels, with June 2025 utilization at **8.7 hours** per aircraft compared to **9.7 hours** in June 2019[80](index=80&type=chunk) - Pilot union negotiations are ongoing, and the Company has accrued **$192.6 million** for a pilot retention bonus, payable upon ratification of a new collective bargaining agreement[81](index=81&type=chunk)[82](index=82&type=chunk)[83](index=83&type=chunk) - The VivaAerobus alliance application for antitrust immunity remains suspended by the US DOT due to measures forcing the Mexican Government to correct perceived violations of the air transport agreement[85](index=85&type=chunk)[86](index=86&type=chunk) [Results of Operations](index=25&type=section&id=Results%20of%20Operations) Revenue grew in Q2 and H1 2025, but significant special charges from Sunseeker write-down led to operating losses [Comparison of three months ended June 30, 2025 to three months ended June 30, 2024](index=25&type=section&id=Comparison%20of%20three%20months%20ended%20June%2030,%202025%20to%20three%20months%20ended%20June%2030,%202024) Q2 2025 total operating revenues rose **3.5%** to **$689.4 million**, but **$117.9 million** in special charges led to a **$67.5 million** operating loss Operating Revenue (in thousands) - Three Months Ended June 30 | Operating Revenues (in thousands) | 2025 | 2024 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Passenger | $617,908 | $594,499 | 3.9% | | Third party products | 33,649 | 37,102 | (9.3)% | | Fixed fee contracts | 17,019 | 17,699 | (3.8)% | | Resort and other | 20,808 | 16,983 | 22.5% | | **Total operating revenues** | **$689,384** | **$666,283** | **3.5%** | - Passenger revenue increased by **$23.4 million (3.9%)** due to an **11.0%** increase in scheduled service passengers, with a **3.4%** increase in average ancillary fare offsetting a **16.9%** decline in average base fare[87](index=87&type=chunk) - Resort revenues increased by **$3.8 million (22.7%)** with occupancy rising to **51.0%** from **33.0%** in Q2 2024, partially offset by a decrease in average daily rate[90](index=90&type=chunk) Airline Unitized Costs (in cents) - Three Months Ended June 30 | Airline Unitized costs (in cents) | 2025 | 2024 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Salaries and benefits | 3.51 ¢ | 3.94 ¢ | (10.9)% | | Aircraft fuel | 2.86 | 3.39 | (15.6)% | | Station operations | 1.30 | 1.39 | (6.5)% | | Depreciation and amortization | 1.12 | 1.18 | (5.1)% | | Maintenance and repairs | 0.63 | 0.61 | 3.3% | | Sales and marketing | 0.43 | 0.52 | (17.3)% | | Aircraft lease rentals | 0.19 | 0.11 | 72.7% | | Other | 0.50 | 0.48 | 4.2% | | Special charges | 0.25 | 0.40 | (37.5)% | | **Airline operating CASM** | **10.79 ¢** | **12.02 ¢** | **(10.2)%** | | **Airline operating CASM, excluding fuel** | **7.93 ¢** | **8.63 ¢** | **(8.1)%** | | **Airline operating CASM, excluding fuel and special charges** | **7.68 ¢** | **8.23 ¢** | **(6.7)%** | - Airline operating CASM, excluding fuel and special charges, decreased **6.7%** to **7.68 ¢**, primarily due to a **15.7%** increase in ASMs and efficient capacity growth without increasing full-time equivalent employees[92](index=92&type=chunk) - Special charges totaled **$117.9 million**, including a **$100.4 million** write-down for Sunseeker Resort and **$14.6 million** for airline corporate restructuring efforts[104](index=104&type=chunk)[105](index=105&type=chunk) [Comparison of six months ended June 30, 2025 to six months ended June 30, 2024](index=28&type=section&id=Comparison%20of%20six%20months%20ended%20June%2030,%202025%20to%20six%20months%20ended%20June%2030,%202024) H1 2025 total operating revenues rose **5.0%** to **$1,388.5 million**, but **$116.4 million** in special charges resulted in a **$2.5 million** operating loss Operating Revenue (in thousands) - Six Months Ended June 30 | Operating Revenues (in thousands) | 2025 | 2024 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Passenger | $1,234,658 | $1,174,434 | 5.1% | | Third party products | 68,852 | 70,501 | (2.3)% | | Fixed fee contracts | 33,271 | 36,560 | (9.0)% | | Resort and other | 51,677 | 41,193 | 25.5% | | **Total operating revenues** | **$1,388,458** | **$1,322,688** | **5.0%** | - Passenger revenue increased by **$60.2 million (5.1%)** due to a **9.9%** increase in scheduled service passengers, with a **4.4%** increase in average ancillary fare offsetting a **13.0%** decline in average base fare[108](index=108&type=chunk) - Resort revenues increased by **$10.6 million (26.1%)** with occupancy rising to **60.6%** from **36.1%** in H1 2024, partially offset by a decrease in average daily rate[111](index=111&type=chunk) Airline Unitized Costs (in cents) - Six Months Ended June 30 | Airline Unitized costs (in cents) | 2025 | 2024 | YoY Change (%) | | :--- | :--- | :--- | :--- | | Salaries and benefits | 3.77 ¢ | 4.06 ¢ | (7.1)% | | Aircraft fuel | 2.95 | 3.48 | (15.2)% | | Station operations | 1.32 | 1.39 | (5.0)% | | Depreciation and amortization | 1.11 | 1.20 | (7.5)% | | Maintenance and repairs | 0.63 | 0.62 | 1.6% | | Sales and marketing | 0.43 | 0.56 | (23.2)% | | Aircraft lease rentals | 0.15 | 0.12 | 25.0% | | Other | 0.46 | 0.58 | (20.7)% | | Special charges | 0.14 | 0.36 | (61.1)% | | **Airline operating CASM** | **10.96 ¢** | **12.37 ¢** | **(11.4)%** | | **Airline operating CASM, excluding fuel** | **8.01 ¢** | **8.90 ¢** | **(10.0)%** | | **Airline operating CASM, excluding fuel and special charges** | **7.87 ¢** | **8.54 ¢** | **(7.8)%** | - Airline operating CASM, excluding fuel and special charges, decreased **7.8%** to **7.87 ¢**, driven by a **15.0%** increase in ASMs and efficient capacity growth[113](index=113&type=chunk) - Special charges totaled **$116.4 million**, including a **$100.4 million** write-down for Sunseeker Resort and **$16.0 million** for airline corporate restructuring and accelerated depreciation[126](index=126&type=chunk)[127](index=127&type=chunk)[128](index=128&type=chunk) [Comparative Airline-Only Operating Statistics](index=31&type=section&id=Comparative%20Airline-Only%20Operating%20Statistics) Airline operations in Q2 and H1 2025 saw significant capacity and passenger growth, with improved CASM excluding fuel and special charges Airline Operating Statistics - Three Months Ended June 30 | Airline operating statistics (unaudited) | 2025 | 2024 | Percent Change YoY | | :--- | :--- | :--- | :--- | | Passengers | 5,127,025 | 4,621,848 | 10.9 % | | Available seat miles (ASMs) (thousands) | 5,799,409 | 5,013,209 | 15.7 | | Airline operating CASM, excluding fuel and special charges (cents) | 7.68 ¢ | 8.23 ¢ | (6.7) | | Departures | 37,314 | 32,252 | 15.7 | | Average block hours per aircraft per day | 7.7 | 6.6 | 16.7 | | Average fuel cost per gallon | $2.42 | $2.83 | (14.5) | | Load factor | 81.9 % | 84.7 % | (2.8) ppt | | Average fare - total | $128.32 | $138.12 | (7.1) | Airline Operating Statistics - Six Months Ended June 30 | Airline operating statistics (unaudited) | 2025 | 2024 | Percent Change YoY | | :--- | :--- | :--- | :--- | | Passengers | 9,578,331 | 8,726,708 | 9.8 % | | Available seat miles (ASMs) (thousands) | 11,250,993 | 9,785,180 | 15.0 | | Airline operating CASM, excluding fuel and special charges (cents) | 7.87 ¢ | 8.54 ¢ | (7.8) | | Departures | 70,549 | 61,477 | 14.8 | | Average block hours per aircraft per day | 7.6 | 6.5 | 16.9 | | Average fuel cost per gallon | $2.51 | $2.92 | (14.0) | | Load factor | 81.2 % | 84.3 % | (3.1) ppt | | Average fare - total | $137.23 | $144.05 | (4.7) | [Liquidity and Capital Resources](index=33&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity increased to **$852.8 million** by June 30, 2025, with decreased net debt and suspended dividends for fleet investments - Cash, cash equivalents, and investment securities increased to **$852.8 million** as of June 30, 2025, from **$832.9 million** at December 31, 2024[133](index=133&type=chunk) - As of June 30, 2025, the Company had **$275.0 million** of undrawn capacity under revolving credit facilities and **$335.0 million** in undrawn borrowing capacity under aircraft financing facilities[133](index=133&type=chunk)[139](index=139&type=chunk) - Net debt (total debt less unrestricted cash, cash equivalents, and investments) decreased by **$124.5 million** to **$1.11 billion** as of June 30, 2025, from December 31, 2024[138](index=138&type=chunk) - The Company has indefinitely suspended its quarterly cash dividend in anticipation of upcoming capital needs related to fleet investments[136](index=136&type=chunk) - Approximately **68.1%** of the Company's debt and finance lease obligations are fixed-rate as of June 30, 2025[140](index=140&type=chunk) [Sources and Uses of Cash](index=33&type=section&id=Sources%20and%20Uses%20of%20Cash) Operating activities generated **$283.6 million** cash in H1 2025, while investing and financing activities resulted in significant outflows - Net cash provided by operating activities was **$283.6 million** for the six months ended June 30, 2025, compared to **$236.7 million** in 2024[141](index=141&type=chunk) - Net cash used in investing activities was **$241.8 million** for the six months ended June 30, 2025, compared to **$109.8 million** in 2024, primarily due to **$90.0 million** of net investment purchases and **$186.9 million** in capital expenditures[16](index=16&type=chunk)[145](index=145&type=chunk)[146](index=146&type=chunk) - Net cash used in financing activities was **$116.2 million** for the six months ended June 30, 2025, compared to **$54.4 million** in 2024, driven by **$432.6 million** in debt principal payments, partially offset by **$323.8 million** from new debt issuances[16](index=16&type=chunk)[147](index=147&type=chunk) - Operating cash flows are impacted by advance ticket sales (recorded as air traffic liability), salaries and benefits (including a **$192.6 million** pilot retention bonus accrual), and volatile fuel expenses[142](index=142&type=chunk)[143](index=143&type=chunk)[144](index=144&type=chunk) [CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS](index=35&type=section&id=CAUTIONARY%20NOTE%20REGARDING%20FORWARD-LOOKING%20STATEMENTS) Forward-looking statements involve risks and uncertainties, with actual results potentially differing materially due to various factors, including the Sunseeker sale - Forward-looking statements are based on management's beliefs and assumptions and involve risks, uncertainties, and assumptions, with actual results potentially differing materially[148](index=148&type=chunk)[149](index=149&type=chunk) - Important risk factors include regulatory reviews, aircraft issues, reliance on automated systems and Boeing, data security breaches, volatility of fuel costs, labor issues, economic conditions, government regulations, aircraft financing, the VivaAerobus alliance, terrorist attacks, competitive environment, and the Sunseeker Resort sale[149](index=149&type=chunk) - The Company undertakes no obligation to publicly update any forward-looking statements[150](index=150&type=chunk) [CRITICAL ACCOUNTING POLICIES AND ESTIMATES](index=35&type=section&id=CRITICAL%20ACCOUNTING%20POLICIES%20AND%20ESTIMATES) Critical accounting estimates focus on Sunseeker Resort assets held for sale, valued based on transaction price, subject to revision - Assets are classified as held for sale when all accounting requirements are met, presented at the lower of carrying amount or estimated fair value less costs to sell, with a valuation allowance if necessary[151](index=151&type=chunk) - Sunseeker Resort met held-for-sale criteria in Q2 2025, with its fair value estimated based on an agreed-upon transaction price, leading to a valuation allowance[152](index=152&type=chunk) - Subsequent revisions to these estimates could occur if the underlying transaction or terms change, or due to changing market conditions, industry, economy, or weather events[152](index=152&type=chunk) [ITEM 3. Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=ITEM%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Market risks include volatile fuel prices and interest rate fluctuations on variable-rate debt, with quantified impacts on expenses - Aircraft fuel expense represented **23.9%** of total operating expenses for the six months ended June 30, 2025, making the Company's results significantly impacted by changes in fuel prices[155](index=155&type=chunk) - A hypothetical **10%** increase in the average price per gallon of fuel would have increased fuel expense by approximately **$33.8 million** for the six months ended June 30, 2025[155](index=155&type=chunk) - As of June 30, 2025, the Company had **$629.1 million** of variable-rate debt; a hypothetical **100 basis point** change in interest rates would have affected interest expense by approximately **$3.3 million** for the six months ended June 30, 2025[156](index=156&type=chunk) - The Company does not hedge fuel price risk[155](index=155&type=chunk) [ITEM 4. Controls and Procedures](index=36&type=section&id=ITEM%204.%20Controls%20and%20Procedures) Disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - Disclosure controls and procedures were evaluated and deemed effective as of June 30, 2025, ensuring timely and accurate reporting of required information[157](index=157&type=chunk) - No material changes in internal control over financial reporting occurred during the quarter ending June 30, 2025[158](index=158&type=chunk) PART II. OTHER INFORMATION [ITEM 1. Legal Proceedings](index=37&type=section&id=ITEM%201.%20Legal%20Proceedings) Routine legal and administrative actions are not expected to materially impact financial position, liquidity, or operations - The Company is subject to certain legal and administrative actions considered routine to its business activities[159](index=159&type=chunk) - Management believes the ultimate outcome of any pending legal or administrative matters will not have a material adverse impact on its financial position, liquidity, or results of operations[159](index=159&type=chunk) [ITEM 1A. Risk Factors](index=37&type=section&id=ITEM%201A.%20Risk%20Factors) No changes to risk factors previously disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024 - The Company has evaluated its risk factors and determined there are no changes to those set forth in Part I, Item 1A. of its Annual Report on Form 10-K for the year ended December 31, 2024[160](index=160&type=chunk) [ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=ITEM%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q2 2025, **6,980** shares were repurchased at **$50.36** average, mainly for tax withholding, with **$64.7 million** remaining authority Repurchases of Common Stock - Second Quarter 2025 | Period | Total Number of Shares Purchased | Average Price Paid per Share | Approximate Dollar Value of Shares that May yet be Purchased Under the Plans or Programs (in thousands) | | :--- | :--- | :--- | :--- | | April | 6,600 | $50.14 | | | May | 380 | $54.24 | | | June | — | $— | | | **Total** | **6,980** | **$50.36** | **$64,694** | - Shares repurchased were primarily from employees who vested a portion of their restricted stock grants, to satisfy income tax withholding requirements[161](index=161&type=chunk) [ITEM 3. Defaults Upon Senior Securities](index=37&type=section&id=ITEM%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported during the period - None[162](index=162&type=chunk) [ITEM 4. Mine Safety Disclosures](index=37&type=section&id=ITEM%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's operations - Not applicable[162](index=162&type=chunk) [ITEM 5. Other Information](index=37&type=section&id=ITEM%205.%20Other%20Information) No directors or executive officers adopted or terminated Rule 10b5-1 trading plans in Q2 2025 - During the three months ended June 30, 2025, none of the Company's directors or executive officers adopted or terminated any Rule 10b5-1 trading plans or non-Rule 10b5-1 trading arrangements[162](index=162&type=chunk) [ITEM 6. Exhibits](index=38&type=section&id=ITEM%206.%20Exhibits) Lists exhibits filed with Form 10-Q, including corporate documents, officer certifications, and XBRL taxonomy - Exhibits include Articles of Incorporation, Bylaws, Rule 13a-14(a)/15d-14(a) Certifications of Principal Executive and Financial Officers, Section 1350 Certifications, and XBRL Taxonomy Extension Documents[165](index=165&type=chunk) [Signatures](index=39&type=section&id=Signatures) Report signed on August 6, 2025, by Robert J. Neal, Executive Vice President and Chief Financial Officer - The report was signed on August 6, 2025, by Robert J. Neal, Executive Vice President and Chief Financial Officer of Allegiant Travel Company[169](index=169&type=chunk)

Core Insights - Allegiant Travel reported revenue of $689.38 million for the quarter ended June 2025, reflecting a 3.5% increase year-over-year, but fell short of the Zacks Consensus Estimate of $698.37 million by 1.29% [1] - The company's EPS was $1.23, down from $1.77 in the same quarter last year, but exceeded the consensus estimate of $0.83 by 48.19% [1] Financial Performance Metrics - Airline operating CASM, excluding fuel, was reported at 7.68 cents, better than the average estimate of 8.32 cents [4] - Available seat miles (ASMs) were 5.63 billion, slightly above the estimated 5.59 billion [4] - Airline operating expense per ASM (CASM) was 10.79 cents, lower than the average estimate of 11.3 cents [4] - Revenue passenger miles (RPMs) reached 4.61 billion, in line with the average estimate of 4.6 billion [4] - Average fuel cost per gallon was $2.4, matching the average estimate [4] - Total passenger revenue per ASM (TRASM) was 11.57 cents, below the average estimate of 11.77 cents [4] - Load factor was reported at 81.2%, exceeding the estimated 80.6% [4] Revenue Breakdown - Operating Revenues from Other sources were $20.81 million, compared to the average estimate of $23.78 million, representing a year-over-year increase of 22.5% [4] - Operating Revenues from Passenger services totaled $617.91 million, slightly below the average estimate of $622.56 million, with a year-over-year increase of 3.9% [4] - Operating Revenues from Third-party products were $33.65 million, below the average estimate of $36.94 million, reflecting a year-over-year decrease of 9.3% [4] - Operating Revenues from Fixed fee contracts were $17.02 million, exceeding the average estimate of $15.57 million, but showing a year-over-year decrease of 3.8% [4] Stock Performance - Allegiant Travel's shares have returned -20.2% over the past month, contrasting with the Zacks S&P 500 composite's +0.6% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Company Performance - Allegiant Travel reported quarterly earnings of $1.23 per share, exceeding the Zacks Consensus Estimate of $0.83 per share, but down from $1.77 per share a year ago, representing an earnings surprise of +48.19% [1] - The company posted revenues of $689.38 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 1.29%, compared to $666.28 million in the same quarter last year [2] - Over the last four quarters, Allegiant Travel has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times [2] Stock Performance and Outlook - Allegiant Travel shares have declined approximately 48.9% since the beginning of the year, while the S&P 500 has gained 6.1% [3] - The current consensus EPS estimate for the upcoming quarter is -$1.62 on revenues of $599.03 million, and for the current fiscal year, it is $2.70 on revenues of $2.67 billion [7] - The estimate revisions trend for Allegiant Travel was unfavorable ahead of the earnings release, resulting in a Zacks Rank 4 (Sell) for the stock, indicating expected underperformance in the near future [6] Industry Context - The Transportation - Airline industry, to which Allegiant Travel belongs, is currently in the top 37% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Core Insights - Allegiant Travel reported adjusted earnings per share (EPS) of $1.23, significantly exceeding the analyst estimate of $0.77, while GAAP revenue reached $689.4 million, slightly above expectations of $685.07 million [1][2] - The company's earnings outperformance was primarily driven by cost discipline, although key demand metrics such as yields and ancillary sales faced ongoing pressure [1][5] Financial Performance - Adjusted diluted EPS for Q2 2025 was $1.23, down 30.5% from $1.77 in Q2 2024 [2] - GAAP revenue increased by 3.5% year-over-year, from $666.3 million in Q2 2024 to $689.4 million in Q2 2025 [2] - Operating margin (Non-GAAP) decreased to 7.3%, down 3.0 percentage points from 10.3% in the previous year [2] - Adjusted net income fell by 30.2% to $22.7 million compared to $32.5 million in Q2 2024 [2] - Total revenue per available seat mile (TRASM) was 11.57¢, a decline of 11.2% year-over-year [6] Business Strategy - Allegiant operates as a low-cost carrier targeting leisure travelers in small and medium-sized cities, focusing on non-stop flights to popular vacation destinations [3] - The company aims to deepen its network in underserved markets and grow ancillary revenue through digital enhancements and loyalty programs [4] - Allegiant is refocusing on its core airline business, planning to divest the Sunseeker Resort, which has led to $103.3 million in special charges [8][10] Operational Highlights - The airline operated a record 37,000 flights in the quarter and added new nonstop routes while maintaining a focus on competition-light markets [8] - Ancillary revenue per passenger improved by $3 in the first half of 2025, attributed to enhanced digital pricing tools [7] - The company continued to invest in its fleet, adding more Boeing 737 MAX aircraft, which are expected to deliver operational and financial improvements [9] Future Outlook - For Q3 2025, Allegiant anticipates adjusted airline-only operating margins to turn negative, with projected adjusted diluted EPS losses between $1.25 and $2.25 [10] - The company expects full-year adjusted airline-only EPS above $3.25 and adjusted consolidated EPS above $2.25 [10] - System capacity is forecasted to increase by about 12% for the full year, but remain flat in fiscal 2026 [10]

Financial Data and Key Metrics Changes - The company reported consolidated net income of $22.7 million and earnings per share of $1.23 for Q2 2025, with airline segment net income at $34.3 million and airline earnings per share at $1.86, exceeding initial expectations [24] - The airline operating margin was 8.6%, ahead of guidance, with a first half operating margin close to 9%, an improvement compared to 2024 [5][24] - Total airline revenue for Q2 was $669 million, approximately 3% above the prior year, with TRASM at $0.157, down 11.2% year over year [17] Business Line Data and Key Metrics Changes - The airline segment's EBITDA was $122.5 million, yielding an EBITDA margin of 18.3% [24] - Fixed fee revenue was down 4% year over year, but ahead of internal estimates [17] - The MAX aircraft accounted for roughly 10% of ASMs in Q2, expected to exceed 15% by year-end [7] Market Data and Key Metrics Changes - Domestic leisure demand was softer than anticipated during the first half of the year, impacting overall performance [6] - The company experienced a decline in TRASM during shoulder and off-peak periods, but managed to maintain profitability due to being one of the lowest cost providers in the industry [7][9] - The company is cautiously optimistic about a modest strengthening of leisure demand in the second half of the year, despite the third quarter typically being the weakest for leisure travel [10][11] Company Strategy and Development Direction - The company is focusing on enhancing its commercial offerings and simplifying its business by exiting non-core operations like Sunseeker [9][10] - Plans for 2026 include a flat capacity outlook, with expectations to improve yields through enhanced Navitaire capabilities and a more mature route network [12][13] - The company aims to divest some Airbus fleet and increase the usage of MAX aircraft, which are expected to be more than 20% of ASMs in 2026 [15] Management's Comments on Operating Environment and Future Outlook - Management expressed pride in the operational performance, achieving a 99.9% controllable completion rate and record passenger numbers [5] - The company remains focused on cost control and operational efficiency, with a commitment to earning the right to grow [12][15] - Management anticipates a consolidated loss per share of $2.25 for Q3, including a loss of approximately $0.50 from Sunseeker, but expects a healthy operating profit for the full year [30][31] Other Important Information - The company ended the quarter with total liquidity of $1.1 billion, including $853 million in cash and investments [26] - The company is planning to retire eight A320 family aircraft and induct nine MAX aircraft into the operating fleet next year [31] - The sale of Sunseeker Resort for $200 million is expected to close in early September, with proceeds used for debt repayment [30] Q&A Session Summary Question: Clarification on full year earnings guidance - Management clarified that the guidance excludes Sunseeker's impact moving forward, with expectations for airline-only EPS around $1.02 for Q3 [36] Question: Details on the Sunseeker sale - The sale is a clean transaction with $200 million in cash proceeds to Allegiant upon closing [39] Question: Outlook for 2026 cost execution - Management indicated that they are not prepared to guide for 2026 yet, as they are still assessing capacity and cost structures [41] Question: Impact of growth headwinds on RASM - Management confirmed that the growth headwind to RASM was approximately five points year-to-date, consistent with Q2 performance [51] Question: Cost leverage from MAX investments - Management stated that there is still significant cost leverage to achieve from the MAX investments, with expectations for improved fuel efficiency [56][58] Question: Booking curve and demand outlook - Management noted that July bookings are complete, with 35-40% left to book for August and September, while 85% remains for Q4 [93]

Financial Data and Key Metrics Changes - The company reported consolidated net income of $22.7 million and earnings per share of $1.23 for Q2 2025, with airline segment net income at $34.3 million and airline earnings per share at $1.86, exceeding initial expectations of approximately $1.00 [27][28] - The airline operating margin was 8.6%, ahead of guidance, and the first half operating margin was close to 9%, an improvement compared to 2024 [5][27] - Total airline revenue for Q2 was $669 million, approximately 3% above the prior year, with a TRASM of $0.157, down 11.2% year over year [18][27] Business Line Data and Key Metrics Changes - The airline segment's EBITDA was $122.5 million, yielding an EBITDA margin of 18.3% [28] - Fixed fee revenue was down 4% year over year, but ahead of internal estimates [18] - The MAX aircraft accounted for roughly 10% of ASMs in Q2, expected to exceed 15% by year-end [8] Market Data and Key Metrics Changes - Domestic leisure demand was softer than anticipated during the first half of the year, impacting overall performance [6][11] - The company noted that peak TRASM performed relatively well, while shoulder and off-peak periods experienced demand softness [10] Company Strategy and Development Direction - The company is exiting the Sunseeker business to simplify operations and focus on its core airline [10] - Plans for the second half of the year include cautious optimism regarding leisure demand, with adjustments to capacity growth expectations due to macroeconomic uncertainties [11][12] - The company aims to enhance revenue through initiatives like Allegiant Extra and improved Navitaire capabilities, expecting to drive incremental revenue [14] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about recent bookings suggesting a modest strengthening of leisure demand, despite the third quarter typically being the weakest for leisure travel [11][12] - The company expects to incur an operating loss in Q3 but anticipates a healthy operating profit for the full year, with Q4 expected to be stronger [12][35] - Management emphasized the importance of operational excellence in driving cost efficiencies and maintaining competitive advantages [51] Other Important Information - The company ended the quarter with total liquidity of $1.1 billion, including $853 million in cash and investments [31] - The company plans to retire eight A320 family aircraft and induct nine MAX aircraft in 2026, with no expected fleet count-driven capacity growth next year [35] Q&A Session Summary Question: Clarification on full-year earnings guidance - Management clarified that the guidance for earnings excludes Sunseeker's impact post-sale, which is expected to close in early September [42][45] Question: Thoughts on 2026 cost execution - Management indicated that they are not ready to guide for 2026 yet, as they are still assessing capacity and pilot deal impacts [47][49] Question: Growth headwinds to RASM - Management acknowledged that the growth profile contributed to headwinds in RASM, similar to previous quarters [56] Question: Booking curve status - Management stated that July bookings are fully booked, with 35-40% left to book for August and September, and 85% left for Q4 [101][102] Question: Margin targets for future growth - Management did not specify margin targets but emphasized the need to earn the right to grow based on operational performance and cost management [106]

[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) Allegiant Travel Company reported a Q2 2025 GAAP diluted loss per share of $(3.62) while achieving record operational performance, revenue growth from commercial initiatives, and strategic business simplification [Second Quarter 2025 Financial Performance Overview](index=1&type=section&id=Second%20Quarter%202025%20Financial%20Performance%20Overview) Allegiant Travel Company reported a GAAP diluted loss per share of $(3.62) for Q2 2025, alongside adjusted airline-only diluted earnings per share of $1.86 and adjusted diluted earnings per share of $1.23 Second Quarter 2025 Financial Performance Overview | Metric | Q2 2025 ($) | Q2 2024 ($) | | :----------------------------------- | :---------- | :---------- | | GAAP Diluted Loss Per Share | $(3.62) | $0.75 | | Adjusted Airline-Only Diluted EPS | $1.86 | $2.24 | | Adjusted Diluted EPS | $1.23 | $1.77 | [Operational Achievements](index=1&type=section&id=Operational%20Achievements) The company achieved its highest quarterly flight total in history with 37,000 flights and a remarkable 99.9% controllable completion factor, earning a second consecutive SkyTrax Award for best low-cost carrier in North America - Operated **37,000 flights**, the highest quarterly total in company history[2](index=2&type=chunk) - Achieved a **99.9% controllable completion factor**, considered among the top in the industry[2](index=2&type=chunk) - Earned a second consecutive SkyTrax Award for best low-cost carrier in North America[2](index=2&type=chunk) [Commercial Initiatives & Revenue Growth](index=1&type=section&id=Commercial%20Initiatives%20%26%20Revenue%20Growth) Commercial initiatives, including new pricing tools, product evolutions, and Allegiant Extra expansion, led to a $3 per passenger improvement in ancillary revenue during the first half of 2025, with further improvements expected from digital transformation - Ancillary revenue increased by **$3 per passenger** during the first half of 2025[4](index=4&type=chunk) - Improved performance resulted from higher productivity of existing assets, with aircraft utilization up nearly **17% year-over-year**, combined with strong cost controls[3](index=3&type=chunk) - Achieved an industry-leading reduction in unit costs, excluding fuel and special charges, of nearly **8% year-over-year**[3](index=3&type=chunk) [Strategic Business Simplification & Outlook](index=1&type=section&id=Strategic%20Business%20Simplification%20%26%20Outlook) The company is simplifying its business by focusing on core strengths, evidenced by the pending sale of Sunseeker Resort. For 2026, full-year capacity is forecasted to be roughly flat, with expected TRASM improvement from new markets, off-peak mix reduction, and commercial initiatives - Pending sale of Sunseeker Resort is expected to close shortly, simplifying the business and focusing on core strengths[6](index=6&type=chunk) - Forecasting full-year capacity for 2026 to be roughly **flat year-over-year**, with MAX deliveries serving as replacement aircraft[7](index=7&type=chunk) - Expect TRASM to improve in 2026 due to new markets maturing, off-peak ASMs becoming a smaller mix, and continued traction from new commercial initiatives[7](index=7&type=chunk) [Summary Financial Results](index=2&type=section&id=Summary%20Financial%20Results) Consolidated operating revenue increased in Q2 2025 and H1 2025, but significant expense increases led to operating losses, while the airline-only segment showed mixed results with special charges impacting overall performance [Consolidated Financial Performance](index=2&type=section&id=Consolidated%20Financial%20Performance) For Q2 2025, consolidated operating revenue increased by 3.5% YoY to $689.4 million, but total operating expense rose significantly by 19.9%, leading to an operating loss of $(67.5) million. For the first six months of 2025, total operating revenue grew 5.0% to $1,388.5 million, but operating expenses increased 9.3%, resulting in an operating loss of $(2.5) million Consolidated Financial Performance (Q2 2025 vs Q2 2024) | Metric | 2025 | 2024 | Percent Change | | :--------------------- | :--- | :--- | :------------- | | Total operating revenue (millions) | $689.4 | $666.3 | 3.5 % | | Total operating expense (millions) | $756.9 | $631.4 | 19.9 % | | Operating income (loss) (millions) | $(67.5) | $34.9 | NM | | Net income (loss) (millions) | $(65.2) | $13.7 | NM | | Diluted earnings (loss) per share ($) | $(3.62) | $0.75 | NM | Consolidated Financial Performance (Six Months Ended June 30, 2025 vs 2024) | Metric | 2025 | 2024 | Percent Change | | :--------------------- | :--- | :--- | :------------- | | Total operating revenue (millions) | $1,388.5 | $1,322.7 | 5.0 % | | Total operating expense (millions) | $1,390.9 | $1,272.3 | 9.3 % | | Operating income (loss) (millions) | $(2.5) | $50.3 | NM | | Net income (loss) (millions) | $(33.1) | $12.8 | NM | | Diluted earnings (loss) per share ($) | $(1.84) | $0.68 | NM | [Airline-Only Financial Performance](index=2&type=section&id=Airline-Only%20Financial%20Performance) The airline-only segment saw operating revenue increase by 3.0% in Q2 2025 to $668.8 million, but operating income decreased by 8.1% to $43.2 million. For the first six months of 2025, airline operating revenue grew 4.3% to $1,337.1 million, with operating income increasing significantly by 46.1% to $104.0 million Airline-Only Financial Performance (Q2 2025 vs Q2 2024) | Metric | 2025 | 2024 | Percent Change | | :--------------------- | :--- | :--- | :------------- | | Airline operating revenue (millions) | $668.8 | $649.5 | 3.0 % | | Airline operating expense (millions) | $625.6 | $602.5 | 3.8 % | | Airline operating income (millions) | $43.2 | $47.0 | (8.1)% | | Adjusted airline-only operating margin (%) | 8.6 % | 10.3 % | (1.7) | | Adjusted airline-only diluted earnings per share ($) | $1.86 | $2.24 | (17.0)% | Airline-Only Financial Performance (Six Months Ended June 30, 2025 vs 2024) | Metric | 2025 | 2024 | Percent Change | | :--------------------- | :--- | :--- | :------------- | | Airline operating revenue (millions) | $1,337.1 | $1,282.0 | 4.3 % | | Airline operating expense (millions) | $1,233.1 | $1,210.8 | 1.8 % | | Airline operating income (millions) | $104.0 | $71.2 | 46.1 % | | Adjusted airline-only operating margin (%) | 9.0 % | 8.3 % | 0.7 | | Adjusted airline-only diluted earnings per share ($) | $3.96 | $3.31 | 19.6 % | [Notes on Special Charges and Non-GAAP Measures](index=3&type=section&id=Notes%20on%20Special%20Charges%20and%20Non-GAAP%20Measures) The company recognized special charges in 2025 and 2024 related to Airline activities, the pending sale of Sunseeker Resort, and weather-related damages. Adjusted financial figures in the release exclude these special charges and a Q1 2025 non-operating loss on debt extinguishment - Special charges in 2025 and 2024 relate to Airline activities, the pending sale of Sunseeker Resort and Aileron Golf Course, and weather-related damages at Sunseeker Resort[10](index=10&type=chunk) - Adjusted numbers in the earnings release exclude the effect of these special charges[10](index=10&type=chunk) - A **$3.4 million** non-operating loss on the extinguishment of debt secured by Sunseeker Resort in Q1 2025 is added back to adjusted results[10](index=10&type=chunk) [Second Quarter 2025 Detailed Results and Highlights](index=4&type=section&id=Second%20Quarter%202025%20Detailed%20Results%20and%20Highlights) Q2 2025 saw a 3.5% increase in consolidated operating revenue, $1.1 billion in liquidity, $137.7 million in capital expenditures, and a pending $200 million sale of Sunseeker Resort [Key Financial Metrics](index=4&type=section&id=Key%20Financial%20Metrics) Allegiant reported total consolidated operating revenue of $689.4 million, a 3.5% increase year-over-year, driven by 15.7% capacity growth. Adjusted airline-only operating CASM, excluding fuel, decreased by 6.7% year-over-year to 7.68 cents - Total consolidated operating revenue: **$689.4 million**, up **3.5% YoY**, on capacity growth of **15.7% YoY**[15](index=15&type=chunk) - Adjusted consolidated operating income: **$50.4 million**, yielding an adjusted operating margin of **7.3%**[15](index=15&type=chunk) - Adjusted airline-only operating CASM, excluding fuel: **7.68 cents**, down **6.7% YoY**[15](index=15&type=chunk) [Balance Sheet, Cash and Liquidity](index=4&type=section&id=Balance%20Sheet%2C%20Cash%20and%20Liquidity) As of June 30, 2025, total available liquidity was $1.1 billion, including $852.7 million in cash and investments. The company generated $92.2 million in cash from operations during Q2 2025, with total debt at $2.0 billion and net debt at $1.1 billion - Total available liquidity at June 30, 2025: **$1.1 billion**, including **$852.7 million** in cash and investments, and **$275.0 million** in undrawn revolving credit facilities[15](index=15&type=chunk) - Cash from operations during Q2 2025: **$92.2 million**[15](index=15&type=chunk) - Total debt at June 30, 2025: **$2.0 billion**; Net debt: **$1.1 billion**[15](index=15&type=chunk) [Airline Capital Expenditures](index=4&type=section&id=Airline%20Capital%20Expenditures) Second quarter capital expenditures totaled $137.7 million, with $108.3 million allocated to aircraft-related capital expenditures and $29.4 million to other airline capital expenditures. Deferred heavy maintenance expenditures were $10.0 million - Second quarter capital expenditures: **$137.7 million**, including **$108.3 million** for aircraft-related and **$29.4 million** in other airline capital expenditures[15](index=15&type=chunk) - Second quarter deferred heavy maintenance expenditures: **$10.0 million**[15](index=15&type=chunk) [Sunseeker Resort Charlotte Harbor Update](index=4&type=section&id=Sunseeker%20Resort%20Charlotte%20Harbor%20Update) Sunseeker Resort reported 51% occupancy in Q2 2025 with an average daily rate of $225. A contract for its sale for $200 million was announced in Q3, expected to close in the same quarter, leading to $102.2 million in special charges for a write-down to fair value - Second quarter occupancy for Sunseeker Resort was **51%** with an average daily rate of **$225 per night**[15](index=15&type=chunk) - A contract for the sale of Sunseeker Resort for **$200 million** was announced during the third quarter, with the transaction expected to close in Q3[15](index=15&type=chunk) - Recorded special charges of **$102.2 million** during Q2 related to the pending sale of Sunseeker Resort and Aileron Golf Course, reflecting a write-down to fair value[15](index=15&type=chunk) [Guidance and Fleet Plan](index=5&type=section&id=Guidance%20and%20Fleet%20Plan) Allegiant provided Q3 and full-year 2025 guidance, projecting system ASM growth and adjusted airline-only EPS, alongside a detailed aircraft fleet plan showing a slight reduction by year-end 2025 [Third Quarter and Full-Year 2025 Guidance](index=5&type=section&id=Third%20Quarter%20and%20Full-Year%202025%20Guidance) For Q3 2025, Allegiant anticipates system ASMs to increase by approximately 9.0% year-over-year, with an adjusted airline-only operating margin between (3.0%) and (6.0%). Full-year 2025 guidance projects system ASMs to grow by about 12.0% and adjusted airline-only earnings per share to be greater than $3.25 Third Quarter 2025 Airline-Only Guidance | Metric | Guidance | | :----------------------------------- | :------- | | System ASMs - year over year change (%) | ~9.0% | | Scheduled service ASMs - year over year change (%) | ~10.0% | | Fuel cost per gallon ($) | $2.55 | | Adjusted airline-only operating margin (%) | (3.0%) to (6.0%) | | Adjusted airline-only earnings per share ($) | ($1.25) to ($2.25) | | Adjusted consolidated earnings per share ($) | ($1.75) to ($2.75) | Full-Year 2025 Guidance | Metric | Guidance | | :----------------------------------- | :------- | | System ASMs - year over year change (%) | ~12.0% | | Scheduled service ASMs - year over year change (%) | ~13.0% | | Fuel cost per gallon ($) | ~$2.53 | | Adjusted airline-only earnings per share ($) | > $3.25 | | Adjusted consolidated earnings per share ($) | > $2.25 | | Interest expense (millions) | $140 to $150 | | Capitalized interest (millions) | ($15) to ($25) | | Interest income (millions) | $30 to $40 | | Airline full-year CAPEX (Aircraft-related, millions) | $260 to $280 | | Capitalized deferred heavy maintenance (millions) | $50 to $70 | | Other airline capital expenditures (millions) | $95 to $115 | | Recurring principal payments (millions) | $160 to $170 | [Aircraft Fleet Plan](index=6&type=section&id=Aircraft%20Fleet%20Plan) The company's aircraft fleet is projected to decrease from 126 aircraft at the end of Q2 2025 to 122 aircraft by the end of Q3 2025 and remain at 122 by year-end 2025, with changes in the mix of Boeing 737-8200 and various Airbus A320/A319 models Aircraft Fleet Plan by End of Period | Aircraft - (seats per AC) | 2Q25 (count) | 3Q25 (count) | YE25 (count) | | :------------------------ | :----------- | :----------- | :----------- | | Boeing 737-8200 (190 seats) | 9 | 10 | 16 | | Airbus A320 (180 seats) | 67 | 74 | 71 | | Airbus A320 (186 seats) | 8 | — | — | | Airbus A320 (177 seats) | 10 | 8 | 7 | | Airbus A319 (156 seats) | 32 | 30 | 28 | | Total | 126 | 122 | 122 | [Company Information and Forward-Looking Statements](index=7&type=section&id=Company%20Information%20and%20Forward-Looking%20Statements) Allegiant Travel Company, a Las Vegas-based integrated travel company, provides nonstop flights to vacation destinations, with its press release containing forward-looking statements subject to inherent risks and uncertainties [Company Profile](index=7&type=section&id=Company%20Profile) Allegiant Travel Company is a Las Vegas-based integrated travel company, primarily an airline, connecting travelers in underserved cities to vacation destinations with nonstop flights and low fares since 1999 - Allegiant (NASDAQ: ALGT) is a Las Vegas-based integrated travel company with an airline at its core[20](index=20&type=chunk) - Focuses on connecting customers in underserved cities to world-class vacation destinations with all-nonstop flights and industry-low average fares since 1999[20](index=20&type=chunk) [Safe Harbor Statement](index=7&type=section&id=Safe%20Harbor%20Statement) The press release includes forward-looking statements, which are estimates based on management's beliefs and assumptions, and are subject to risks, uncertainties, and assumptions that could cause actual results to differ materially. The company undertakes no obligation to update these statements - Statements in the press release that are not historical facts are forward-looking statements, based on management's beliefs and assumptions[21](index=21&type=chunk) - Forward-looking statements involve risks, uncertainties, and assumptions, and actual results may differ materially[22](index=22&type=chunk) - The company undertakes no obligation to publicly update any forward-looking statements[23](index=23&type=chunk) [Detailed Financial Statements (GAAP)](index=8&type=section&id=Detailed%20Financial%20Statements%20%28GAAP%29) Detailed GAAP statements reveal a consolidated net loss for Q2 and H1 2025, primarily due to increased operating expenses and significant special charges, despite revenue growth and improved airline operating income for the six-month period [Consolidated Statements of Income (Three Months)](index=8&type=section&id=Consolidated%20Statements%20of%20Income%20%28Three%20Months%29) For the three months ended June 30, 2025, Allegiant reported a consolidated net loss of $(65.166) million, a significant decline from a net income of $13.699 million in the prior year, primarily due to a substantial increase in total operating expenses, particularly special charges Consolidated Statements of Income (Three Months Ended June 30) | Metric | 2025 (thousands) | 2024 (thousands) | Percent Change | | :---------------------- | :--------------- | :--------------- | :------------- | | Total operating revenues | $689,384 | $666,283 | 3.5 % | | Total operating expenses | $756,873 | $631,386 | 19.9 % | | Operating income (loss) | $(67,489) | $34,897 | NM | | Net income (loss) | $(65,166) | $13,699 | NM | | Diluted earnings (loss) per share ($) | $(3.62) | $0.75 | NM | - Special charges, net of recoveries, increased significantly from **$18,114 thousand** in Q2 2024 to **$117,924 thousand** in Q2 2025[25](index=25&type=chunk) [Segment Profit or Loss (Three Months)](index=9&type=section&id=Segment%20Profit%20or%20Loss%20%28Three%20Months%29) In Q2 2025, the Airline segment reported an operating income of $43.157 million, a decrease from $46.956 million in Q2 2024. The Sunseeker segment incurred a substantial operating loss of $(110.646) million, primarily due to $103.329 million in special charges related to its pending sale Segment Operating Income (Loss) (Three Months Ended June 30) | Segment | 2025 (thousands) | 2024 (thousands) | | :--------------------- | :--------------- | :--------------- | | Airline operating income | $43,157 | $46,956 | | Sunseeker operating loss | $(110,646) | $(12,059) | | Consolidated operating income (loss) | $(67,489) | $34,897 | - Sunseeker special charges, net of recoveries, were **$103,329 thousand** in Q2 2025, compared to **$(1,959) thousand** in Q2 2024[27](index=27&type=chunk) [Airline Operating Statistics (Three Months)](index=10&type=section&id=Airline%20Operating%20Statistics%20%28Three%20Months%29) For Q2 2025, total system ASMs increased by 15.7% year-over-year, while airline operating expense per ASM (CASM) decreased by 10.2% to 10.79 cents. Load factor declined by 2.8 percentage points to 81.9%, and total passenger revenue per ASM (TRASM) decreased by 11.2% to 11.57 cents Airline Operating Statistics (Three Months Ended June 30) | Metric | 2025 | 2024 | Percent Change | | :----------------------------------- | :--- | :--- | :------------- | | Passengers | 5,127,025 | 4,621,848 | 10.9 % | | Available seat miles (ASMs) (thousands) | 5,799,409 | 5,013,209 | 15.7 % | | Airline operating expense per ASM (CASM) (cents) | 10.79 ¢ | 12.02 ¢ | (10.2)% | | Load factor (%) | 81.9 % | 84.7 % | (2.8) | | Total passenger revenue per ASM (TRASM) (cents) | 11.57 ¢ | 13.03 ¢ | (11.2)% | | Average fuel cost per gallon ($) | $2.42 | $2.83 | (14.5)% | [Consolidated Statements of Income (Six Months)](index=11&type=section&id=Consolidated%20Statements%20of%20Income%20%28Six%20Months%29) For the six months ended June 30, 2025, consolidated total operating revenues increased by 5.0% to $1,388.458 million. However, total operating expenses rose by 9.3%, leading to a consolidated operating loss of $(2.487) million, compared to an operating income of $50.344 million in the prior year Consolidated Statements of Income (Six Months Ended June 30) | Metric | 2025 (thousands) | 2024 (thousands) | Percent Change | | :---------------------- | :--------------- | :--------------- | :------------- | | Total operating revenues | $1,388,458 | $1,322,688 | 5.0 % | | Total operating expenses | $1,390,945 | $1,272,344 | 9.3 % | | Operating income (loss) | $(2,487) | $50,344 | NM | | Net income (loss) | $(33,064) | $12,780 | NM | | Diluted earnings (loss) per share ($) | $(1.84) | $0.68 | NM | - Special charges, net of recoveries, for the six months increased from **$31,212 thousand** in 2024 to **$116,369 thousand** in 2025[31](index=31&type=chunk) [Segment Profit or Loss (Six Months)](index=12&type=section&id=Segment%20Profit%20or%20Loss%20%28Six%20Months%29) For the first six months of 2025, the Airline segment's operating income increased by 46.1% to $104.009 million. Conversely, the Sunseeker segment reported a significant operating loss of $(106.496) million, primarily driven by $100.382 million in special charges Segment Operating Income (Loss) (Six Months Ended June 30) | Segment | 2025 (thousands) | 2024 (thousands) | | :--------------------- | :--------------- | :--------------- | | Airline operating income | $104,009 | $71,172 | | Sunseeker operating loss | $(106,496) | $(20,828) | | Consolidated operating income (loss) | $(2,487) | $50,344 | - Sunseeker special charges, net of recoveries, were **$100,382 thousand** for the six months ended June 30, 2025, compared to **$(3,775) thousand** in the prior year[33](index=33&type=chunk) [Airline Operating Statistics (Six Months)](index=13&type=section&id=Airline%20Operating%20Statistics%20%28Six%20Months%29) For the first six months of 2025, total system ASMs increased by 15.0% year-over-year, while airline operating expense per ASM (CASM) decreased by 11.5% to 10.96 cents. Load factor declined by 3.1 percentage points to 81.2%, and total passenger revenue per ASM (TRASM) decreased by 9.2% to 11.92 cents Airline Operating Statistics (Six Months Ended June 30) | Metric | 2025 | 2024 | Percent Change | | :----------------------------------- | :--- | :--- | :------------- | | Passengers | 9,578,331 | 8,726,708 | 9.8 % | | Available seat miles (ASMs) (thousands) | 11,250,993 | 9,785,180 | 15.0 % | | Airline operating expense per ASM (CASM) (cents) | 10.96 ¢ | 12.38 ¢ | (11.5)% | | Load factor (%) | 81.2 % | 84.3 % | (3.1) | | Total passenger revenue per ASM (TRASM) (cents) | 11.92 ¢ | 13.13 ¢ | (9.2)% | | Average fuel cost per gallon ($) | $2.51 | $2.92 | (14.0)% | [Summary Balance Sheet](index=14&type=section&id=Summary%20Balance%20Sheet) As of June 30, 2025, total unrestricted cash and investments increased by 2.4% to $852.7 million compared to December 31, 2024. Total debt decreased by 5.1% to $1,962.0 million, resulting in a 10.1% reduction in net debt to $1,109.3 million Summary Balance Sheet (June 30, 2025 vs December 31, 2024) | Metric | June 30, 2025 (millions) | December 31, 2024 (millions) | Percent Change | | :----------------------------------- | :----------------------- | :--------------------------- | :------------- | | Unrestricted cash and investments | $852.7 | $832.8 | 2.4 % | | Total debt | $1,962.0 | $2,066.5 | (5.1)% | | Debt, net of unrestricted cash and investments | $1,109.3 | $1,233.7 | (10.1)% | | Total Allegiant Travel Company shareholders' equity | $1,055.9 | $1,089.4 | (3.1)% | [EPS Calculation](index=14&type=section&id=EPS%20Calculation) The basic and diluted earnings per share calculations for Q2 2025 show a loss of $(3.62), compared to earnings of $0.75 in Q2 2024. For the six months ended June 30, 2025, basic and diluted EPS were $(1.84), down from $0.69 and $0.68 respectively in the prior year Earnings (Loss) Per Share (Three Months Ended June 30) | Metric | 2025 ($) | 2024 ($) | | :----------------------------------- | :--- | :--- | | Earnings (loss) per share, basic | $(3.62) | $0.75 | | Earnings (loss) per share, diluted | $(3.62) | $0.75 | | Weighted-average shares outstanding (thousands) | 17,995 | 17,828 | Earnings (Loss) Per Share (Six Months Ended June 30) | Metric | 2025 ($) | 2024 ($) | | :----------------------------------- | :--- | :--- | | Earnings (loss) per share, basic | $(1.84) | $0.69 | | Earnings (loss) per share, diluted | $(1.84) | $0.68 | | Weighted-average shares outstanding (thousands) | 17,989 | 17,746 | [Non-GAAP Financial Measures Reconciliation (Appendix A)](index=15&type=section&id=Non-GAAP%20Financial%20Measures%20Reconciliation%20%28Appendix%20A%29) Allegiant provides reconciliations for various adjusted non-GAAP financial measures, excluding special charges and a debt extinguishment loss, to offer a clearer view of airline performance and enhance comparability for investors [Explanation of Non-GAAP Measures](index=15&type=section&id=Explanation%20of%20Non-GAAP%20Measures) Allegiant presents various adjusted non-GAAP financial measures, including adjusted operating expense/income, adjusted income before taxes, adjusted net income, adjusted diluted EPS, adjusted CASM, and adjusted EBITDA. These measures exclude special charges related to Sunseeker and airline activities, and a one-time loss on debt extinguishment, to provide a clearer view of airline performance and enhance comparability - Adjusted consolidated and airline-only measures exclude special charges related to Sunseeker (losses, write-down) and Airline activities (accelerated depreciation, restructuring, ratification bonus), and a one-time loss on debt extinguishment[39](index=39&type=chunk)[40](index=40&type=chunk) - These non-GAAP measures are presented to help investors better gauge airline performance, compare results to other airlines, and understand non-fuel costs[41](index=41&type=chunk)[42](index=42&type=chunk) - EBITDA and adjusted EBITDA are supplemental measures used to evaluate operating performance and liquidity, but have limitations such as not reflecting capital expenditures or debt service requirements[43](index=43&type=chunk)[45](index=45&type=chunk)[48](index=48&type=chunk) [Reconciliation of Special Charges](index=16&type=section&id=Reconciliation%20of%20Special%20Charges) Consolidated special charges, net of recoveries, significantly increased to $117.9 million in Q2 2025 from $18.1 million in Q2 2024, and to $116.4 million for the six months ended June 30, 2025, from $31.2 million in the prior year. This was primarily driven by Sunseeker special charges, which included a write-down related to its pending sale Special Charges (millions) | Metric | Three Months Ended June 30, 2025 (millions) | Three Months Ended June 30, 2024 (millions) | Six Months Ended June 30, 2025 (millions) | Six Months Ended June 30, 2024 (millions) | | :----------------------------------- | :---------------------------------------- | :---------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Accelerated depreciation on airframes | $2.5 | $9.3 | $3.9 | $24.2 | | Flight attendant ratification bonus | — | $10.8 | — | $10.8 | | Organizational restructuring | $12.1 | — | $12.1 | — | | Airline special charges | $14.6 | $20.1 | $16.0 | $35.0 | | Sunseeker special charges, net | $103.3 | $(2.0) | $100.4 | $(3.8) | | Consolidated special charges, net | $117.9 | $18.1 | $116.4 | $31.2 | [Reconciliation of Adjusted Operating Metrics (Three Months)](index=16&type=section&id=Reconciliation%20of%20Adjusted%20Operating%20Metrics%20%28Three%20Months%29) For Q2 2025, adjusted consolidated operating income was $50.4 million (7.3% margin), a decrease from $53.0 million (8.0% margin) in Q2 2024. Adjusted airline-only operating income was $57.8 million (8.6% margin), down from $67.0 million (10.3% margin) in the prior year, reflecting the impact of special charges Adjusted Operating Metrics (Three Months Ended June 30, 2025) | Metric | GAAP (millions) | Adjustments (millions) | Adjusted (Non-GAAP) (millions) | | :----------------------------------- | :-------------- | :--------------------- | :----------------------------- | | Consolidated Operating income (loss) | $(67.5) | $117.9 | $50.4 | | Consolidated Operating margin (percent) | (9.8) | | 7.3 | | Airline Operating income (loss) | $43.2 | $14.6 | $57.8 | | Airline Operating margin (percent) | 6.5 | | 8.6 | | Consolidated Income (loss) before income taxes | $(88.6) | $117.9 | $29.4 | | Airline Income (loss) before income taxes | $29.7 | $14.6 | $44.3 | Adjusted Operating Metrics (Three Months Ended June 30, 2024) | Metric | GAAP (millions) | Adjustments (millions) | Adjusted (Non-GAAP) (millions) | | :----------------------------------- | :-------------- | :--------------------- | :----------------------------- | | Consolidated Operating income (loss) | $34.9 | $18.1 | $53.0 | | Consolidated Operating margin (percent) | 5.2 | | 8.0 | | Airline Operating income (loss) | $47.0 | $20.1 | $67.0 | | Airline Operating margin (percent) | 7.2 | | 10.3 | | Consolidated Income (loss) before income taxes | $18.0 | $18.1 | $36.1 | | Airline Income (loss) before income taxes | $35.5 | $20.1 | $55.6 | [Reconciliation of Adjusted Operating Metrics (Six Months)](index=18&type=section&id=Reconciliation%20of%20Adjusted%20Operating%20Metrics%20%28Six%20Months%29) For the six months ended June 30, 2025, adjusted consolidated operating income was $113.9 million (8.2% margin), an increase from $81.6 million (6.2% margin) in the prior year. Adjusted airline-only operating income rose to $120.0 million (9.0% margin) from $106.2 million (8.3% margin) in 2024 Adjusted Operating Metrics (Six Months Ended June 30, 2025) | Metric | GAAP (millions) | Adjustments (millions) | Adjusted (Non-GAAP) (millions) | | :----------------------------------- | :-------------- | :--------------------- | :----------------------------- | | Consolidated Operating income (loss) | $(2.5) | $116.4 | $113.9 | | Consolidated Operating margin (percent) | (0.2) | | 8.2 | | Airline Operating income (loss) | $104.0 | $16.0 | $120.0 | | Airline Operating margin (percent) | 7.8 | | 9.0 | | Consolidated Income (loss) before income taxes | $(46.6) | $119.8 | $73.2 | | Airline Income (loss) before income taxes | $79.3 | $16.0 | $95.3 | Adjusted Operating Metrics (Six Months Ended June 30, 2024) | Metric | GAAP (millions) | Adjustments (millions) | Adjusted (Non-GAAP) (millions) | | :----------------------------------- | :-------------- | :--------------------- | :----------------------------- | | Consolidated Operating income (loss) | $50.3 | $31.2 | $81.6 | | Consolidated Operating margin (percent) | 3.8 | | 6.2 | | Airline Operating income (loss) | $71.2 | $35.0 | $106.2 | | Airline Operating margin (percent) | 5.6 | | 8.3 | | Consolidated Income (loss) before income taxes | $16.7 | $31.2 | $47.9 | | Airline Income (loss) before income taxes | $48.0 | $35.0 | $83.0 | [Reconciliation of EBITDA and Adjusted EBITDA](index=19&type=section&id=Reconciliation%20of%20EBITDA%20and%20Adjusted%20EBITDA) Consolidated EBITDA for Q2 2025 was $0.8 million, significantly lower than $100.2 million in Q2 2024, but adjusted consolidated EBITDA increased slightly to $118.7 million from $118.3 million. For the six months, adjusted consolidated EBITDA grew to $244.8 million from $210.6 million, and adjusted airline-only EBITDA increased to $243.7 million from $223.3 million Consolidated EBITDA and Adjusted Consolidated EBITDA (millions) | Metric | Three Months Ended June 30, 2025 (millions) | Three Months Ended June 30, 2024 (millions) | Six Months Ended June 30, 2025 (millions) | Six Months Ended June 30, 2024 (millions) | | :----------------------------------- | :---------------------------------------- | :---------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Consolidated EBITDA | $0.8 | $100.2 | $128.4 | $179.4 | | Adjusted consolidated EBITDA | $118.7 | $118.3 | $244.8 | $210.6 | Adjusted Airline-Only EBITDA (millions) | Metric | Three Months Ended June 30, 2025 (millions) | Three Months Ended June 30, 2024 (millions) | Six Months Ended June 30, 2025 (millions) | Six Months Ended June 30, 2024 (millions) | | :----------------------------------- | :---------------------------------------- | :---------------------------------------- | :-------------------------------------- | :-------------------------------------- | | Adjusted airline-only EBITDA | $122.5 | $126.3 | $243.7 | $223.3 | [Reconciliation of Adjusted EPS](index=19&type=section&id=Reconciliation%20of%20Adjusted%20EPS) Adjusted consolidated net income for Q2 2025 was $22.7 million, resulting in adjusted diluted EPS of $1.23, down from $1.77 in Q2 2024. Adjusted airline-only net income was $34.3 million, yielding adjusted diluted EPS of $1.86, a decrease from $2.24 in the prior year. For the six months, adjusted consolidated diluted EPS increased to $3.03 from $2.34, and adjusted airline-only diluted EPS rose to $3.96 from $3.31 Adjusted Consolidated Earnings Per Share (Three Months Ended June 30) | Metric | 2025 Amount (millions) | 2025 Per Share ($) | 2024 Amount (millions) | 2024 Per Share ($) | | :----------------------------------- | :--------------------- | :----------------- | :--------------------- | :----------------- | | Net income (loss) attributable to common stock (GAAP) | $(65.2) | $(3.62) | $13.4 | $0.75 | | Adjusted net income attributable to common stock | $22.2 | $1.23 | $31.7 | $1.77 | Adjusted Airline-Only Earnings Per Share (Three Months Ended June 30) | Metric | 2025 Amount (millions) | 2025 Per Share ($) | 2024 Amount (millions) | 2024 Per Share ($) | | :----------------------------------- | :--------------------- | :----------------- | :--------------------- | :----------------- | | Net income (loss) attributable to common stock (GAAP) | $(65.2) | $(3.62) | $13.4 | $0.75 | | Adjusted airline-only net income attributable to common stock | $33.5 | $1.86 | $40.0 | $2.24 | Adjusted Consolidated Earnings Per Share (Six Months Ended June 30) | Metric | 2025 Amount (millions) | 2025 Per Share ($) | 2024 Amount (millions) | 2024 Per Share ($) | | :----------------------------------- | :--------------------- | :----------------- | :--------------------- | :----------------- | | Net income (loss) attributable to common stock (GAAP) | $(33.1) | $(1.84) | $12.2 | $0.68 | | Adjusted net income attributable to common stock | $54.8 | $3.03 | $41.7 | $2.34 | Adjusted Airline-Only Earnings Per Share (Six Months Ended June 30) | Metric | 2025 Amount (millions) | 2025 Per Share ($) | 2024 Amount (millions) | 2024 Per Share ($) | | :----------------------------------- | :--------------------- | :----------------- | :--------------------- | :----------------- | | Net income (loss) attributable to common stock (GAAP) | $(33.1) | $(1.84) | $12.2 | $0.68 | | Adjusted airline-only net income attributable to common stock | $71.5 | $3.96 | $59.0 | $3.31 |

Financial Performance - In Q2 2025, Allegiant Travel Company reported a GAAP diluted loss per share of $(3.62) and an adjusted diluted earnings per share of $1.23, down 30.5% year-over-year [1][8] - Total operating revenue for Q2 2025 was $689.4 million, a 3.5% increase from $666.3 million in Q2 2024 [8] - Total operating expenses rose to $756.9 million, a 19.9% increase compared to $631.4 million in the prior year [8] Operational Highlights - The company operated 37,000 flights in Q2 2025, achieving a 99.9% controllable completion factor, one of the highest in the industry [2] - Adjusted airline-only operating margin was 8.6%, surpassing initial projections despite a challenging demand environment [3] - Aircraft utilization improved by nearly 17% year-over-year, contributing to higher productivity [3] Revenue and Cost Management - Ancillary revenue per passenger improved by $3 during the first half of 2025, aided by new pricing tools and product expansions [4] - The company achieved a nearly 8% reduction in unit costs, excluding fuel and special charges, year-over-year [3] - Adjusted airline-only operating income was $57.8 million, yielding an adjusted airline-only operating margin of 8.6% [8] Future Outlook - The company forecasts flat full-year capacity for 2026, with MAX deliveries expected to serve as replacement aircraft [7] - Recent bookings indicate strengthening domestic demand for the second half of the year, although Q3 is typically the weakest quarter [5] - The company plans to continue focusing on core strengths and simplifying operations, including the pending sale of the Sunseeker Resort for $200 million [6][8] Balance Sheet and Liquidity - As of June 30, 2025, total liquidity was $1.1 billion, including $852.7 million in cash and investments [8] - Total debt stood at $2.0 billion, with net debt at $1.1 billion [8] - The company recorded $92.2 million in cash from operations during Q2 2025 [8]