Core Viewpoint - Surf Air Mobility (SRFM) is expected to report a loss per share of $1.09 for Q2 2025, with revenues estimated at $25.9 million, indicating a 20% year-over-year decline [1][8]. Financial Performance - The Zacks Consensus Estimate for loss per share has remained unchanged at $1.09 over the past 60 days, compared to a loss of $1.96 per share a year ago [1]. - The company reported a loss of $1.31 per share in Q1 2025, which was wider than the Zacks Consensus Estimate of a loss of $1.08 [2]. Revenue Expectations - Scheduled service revenues are anticipated to decrease due to the elimination of unprofitable routes and service interruptions earlier this year [4]. - On-Demand service revenues are also expected to decline year-over-year as the company focuses on charter profitability [4]. - The company expects Q2 revenues to fall within the range of $23.5 million to $26.5 million [4]. Cost Management - Lower technology and compensation costs are expected to positively impact the bottom line for the upcoming quarter [5]. - The company is optimizing its airline plans, which is anticipated to aid results [5]. - Efficiencies from SurfOS, an AI-enabled software platform developed with Palantir Technologies, are expected to contribute positively, with an update anticipated during the Q2 conference call [5]. Earnings Prediction - The Zacks model does not predict an earnings beat for SRFM, as the Earnings ESP is 0.00%, indicating that the Most Accurate Estimate aligns with the Zacks Consensus Estimate [6][7]. Company Ranking - SRFM currently holds a Zacks Rank of 3, indicating a hold position [9].

Summary of Surf Air Mobility Conference Call Company Overview - **Company**: Surf Air Mobility (SRFM) - **Industry**: Regional Air Mobility - **Location**: Los Angeles, California - **Key Operations**: One of the largest commuter airlines in the US by scheduled departures, and the largest US passenger operator of Cessna Caravans [1][2] Core Business Model and Strategy - **Business Segments**: - Air Mobility Business: Scheduled service and charter flight operations - Air Technology Business: Development of Surf OS (software platform) and electrification initiatives [7][11] - **Partnerships**: Collaboration with Palantir for AI-powered software and Textron for electrified aircraft technology [2][12] Industry Insights - **Market Growth**: The global regional air mobility market is projected to grow to between $75 billion and $115 billion by 2035, with the US market accounting for $15 billion to $22 billion [14] - **Electrification Impact**: Anticipated reduction in direct flying costs by 50% for all-electric powertrains and 25% for hybrid powertrains [15][40] Growth Catalysts 1. **Transformation Plan**: A four-phase plan initiated to reposition the company, with the first phase completed in 2024 [18][19] 2. **Scheduled Service Profitability**: Expected profitability in scheduled airline services by 2025 [22] 3. **Launch of Surf OS**: Commercial launch planned for 2026, targeting third-party operators [20] 4. **Electrification Initiative**: Completion of electrified powertrain certification expected by 2027 [21] Competitive Advantages - **Scale**: One of the largest commuter airlines in the US [24] - **Experience**: Over a decade in the aviation industry with extensive operational experience [24] - **Strategic Partnerships**: Exclusive relationships with Textron and Palantir [25] - **Operational Reach**: Interline agreements with major airlines, extending reach to over 430 million customers [27] Operational Performance - **Improved Metrics**: Achieved a 10% increase in controllable completion factor and a 20% increase in on-time departures and arrivals compared to fiscal year 2024 [43] - **Revenue from EAS**: Essential Air Service contracts represent 43% of total revenue, providing recurring government revenues [32] Financial Position - **Capital Structure**: Raised $50 million in a term loan and over $30 million in a registered direct offering to support transformation [48] - **Cost Management**: Streamlined operations by exiting unprofitable routes and addressing deferred maintenance [46] Future Outlook - **Market Positioning**: Positioned at the epicenter of the regional air mobility market with sustainable competitive advantages [53] - **Investment Opportunity**: Unique investment opportunity due to the company's transformation, operational improvements, and market growth potential [52][53]

Core Insights - The article discusses Robert F. Abbott's investment strategies, which include options trading such as covered calls and collars alongside long stock positions since 2010 [1]. Group 1 - Robert F. Abbott has been managing his family's investment accounts since 1995, indicating a long-term commitment to investment management [1]. - In 2010, Abbott diversified his investment approach by incorporating options trading, specifically covered calls and collars, which suggests a strategy aimed at risk management and income generation [1]. - Abbott is also a freelance writer and operates a website aimed at providing information for new and intermediate-level mutual fund investors, highlighting his engagement in financial education [1].

Core Insights - Surf Air Mobility stock (NYSE:SRFM) has seen a significant increase, nearly doubling to approximately $7.60 per share, primarily driven by Palantir increasing its stake from 10% to almost 20% [1] - The company focuses on regional air travel, offering scheduled commercial air service, on-demand charter flights, and air cargo services, with plans to electrify short-haul regional air travel by 2027 [1] Financial Performance - Surf Air Mobility's revenue has grown by 31.2% over the last 12 months, increasing from $86 million to $112 million [3] - The company reported an Operating Income of -$44 million, resulting in an Operating Margin of -39.5% and an Operating Cash Flow of -$57 million, leading to an OCF margin of -51.0% [3] Balance Sheet Analysis - The company has $91 million in debt, leading to a Debt-to-Equity Ratio of about 30%, which is higher than the S&P 500 average of 19.4% [4] - Cash and cash equivalents are at $6.6 million, with a Cash-to-Assets Ratio of 6.3%, although this may have improved following a $27 million direct equity offering [4]

Company Overview - Surf Air Mobility Inc. (SRFM) currently holds a Momentum Style Score of A, indicating strong potential for momentum investing [3] - The company has a Zacks Rank of 2 (Buy), which is associated with a history of outperforming the market [4] Price Performance - SRFM shares have increased by 70.31% over the past week, significantly outperforming the Zacks Transportation - Airline industry, which rose by 5.4% during the same period [6] - Over the past quarter, SRFM shares have gained 63.16%, and over the last year, they have increased by 30.64%, while the S&P 500 only moved 10.42% and 14.64%, respectively [7] Trading Volume - The average 20-day trading volume for SRFM is 13,316,514 shares, which serves as a bullish indicator when combined with rising stock prices [8] Earnings Outlook - In the past two months, one earnings estimate for SRFM has moved higher, while none have moved lower, resulting in an increase in the consensus estimate from -$4.81 to -$3.47 [10] - For the next fiscal year, two estimates have been revised upwards, with no downward revisions during the same period [10] Conclusion - Given the strong price performance, positive earnings outlook, and high Momentum Style Score, SRFM is positioned as a promising investment opportunity [12]

Group 1: Momentum Investing Overview - Momentum investing deviates from the traditional strategy of "buying low and selling high," focusing instead on "buying high and selling higher" to achieve quicker profits [1] - Fast-moving trending stocks can be challenging to enter at the right time, as they may lose momentum if future growth does not justify their inflated valuations [2] Group 2: Investment Strategy - A safer investment approach involves targeting bargain stocks that exhibit recent price momentum, utilizing tools like the Zacks Momentum Style Score to identify promising candidates [3] - Surf Air Mobility Inc. (SRFM) is highlighted as a strong candidate, having experienced a 44% price increase over the past four weeks [4] Group 3: Performance Metrics - SRFM has shown a 35.3% price gain over the last 12 weeks, with a beta of 2.35, indicating it moves 135% more than the market [5] - The stock has a Momentum Score of B, suggesting it is an opportune time to invest [6] Group 4: Earnings and Valuation - SRFM has received a Zacks Rank 2 (Buy) due to positive earnings estimate revisions, which typically attract more investor interest [7] - The stock is currently trading at a Price-to-Sales ratio of 0.62, indicating it is undervalued at 62 cents for each dollar of sales [7] Group 5: Additional Opportunities - Besides SRFM, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [8] - The Zacks Premium Screens offer over 45 different strategies tailored to outperform the market [9]

Core Insights - Surf Air Mobility Inc. (SRFM) reported Q1 2025 revenue of $23.5 million, achieving the high end of its guidance range, with adjusted EBITDA of ($14.4) million and adjusted EPS of ($1.09) [1][5] - The company is transitioning from the Transformation Phase to the Optimization Phase, aiming to improve profitability through strategic cost reductions and optimizations, with significant growth expected in the latter half of FY25 [1][5] - SRFM has entered into its first interline agreement with Japan Airlines, which is expected to enhance end-user experience alongside the launch of a new Jet Card [1][5] Financial Performance - Q1 2025 revenue was $23.5 million, aligning with the high end of the guidance range [5] - Adjusted EBITDA for the quarter was reported at ($14.4) million [1] - Adjusted EPS for the quarter was ($1.09) [1] Strategic Developments - The company is focusing on charter profitability, which has led to a decrease in OnDemand services revenue [1] - The interline agreement with Japan Airlines marks a significant milestone for SRFM, indicating a strategic partnership with an international airline [1][5] - The launch of the new Jet Card emphasizes the company's commitment to enhancing the end-user experience [1][5]

Financial Data and Key Metrics Changes - First quarter revenue was $23,500,000, at the high end of the expected range of $21,000,000 to $24,000,000, keeping the company on track to meet the full year expectation of over $100,000,000 in revenue [8][26] - Adjusted EBITDA loss in Q1 was $14,400,000, within the expected range provided in the last earnings release [8][27] - Scheduled service revenue decreased by 23% year over year, primarily due to the elimination of unprofitable routes and a brief interruption of service in January [27] - On-demand service revenue decreased by 25% year over year, driven by lower sales and flight completions [27] Business Line Data and Key Metrics Changes - The Essential Air Service (EAS) Program represents approximately 40% of revenue, with long-term subsidized contracts providing connectivity to underserved domestic markets [21] - The company is focusing on profitability in the on-demand business and has exited several unprofitable charter products [13][27] - The company returned five older aircraft to lessors during Q1, simplifying the fleet to focus on the operationally efficient Cessna Grand Caravan [10] Market Data and Key Metrics Changes - The company operates almost exclusively in the U.S., primarily flying aircraft manufactured domestically, which mitigates the impact of tariffs [4][20] - The current economic environment has benefited the company, particularly with lower fuel costs [22] Company Strategy and Development Direction - The company aims to become a premier regional air mobility platform, focusing on three growth vectors: expansion of air mobility operations, commercial rollout of the regional air mobility software platform, and sale of electrified powertrains for the Cessna Caravan [29] - The company is in late-stage discussions with key partners to advance its electrification initiative [18][29] Management's Comments on Operating Environment and Future Outlook - Management acknowledges a challenging economic, regulatory, and funding environment but emphasizes proactive management of operations and cost structure [29] - The company expects to achieve positive adjusted EBITDA in airline operations by 2025 [19][28] Other Important Information - The company raised an incremental $5,000,000 in funding subsequent to the end of Q1 [9] - The interline agreement with Japan Airlines allows for expanded access to over 435 million customers [12] Q&A Session Summary Question: Impact of changes to the essential air service budget - Management believes that being a low-cost operator provides a competitive advantage, especially if higher-cost operators face subsidy reductions [33][36] Question: Core versus non-core scheduled and charter flights - Hawaii is identified as a core area, with a focus on profitability and operational efficiency in route selection [37][38] Question: Adding new profitable routes - The company is currently focused on exiting unprofitable routes and plans to enter new tier one routes next year [41] Question: Progress on Surf OS product - The company is integrating feedback from beta users and plans a full commercial rollout of Surf OS in 2026 [44][46] Question: Service interruption details - The service interruption in January was unplanned and related to maintenance issues, which have since been resolved [48] Question: Future partnerships and geographic targets - The company is open to expanding partnerships beyond the U.S., following the successful agreement with Japan Airlines [50]

Financial Data and Key Metrics Changes - First quarter revenue was $23,500,000, at the high end of the expected range of $21,000,000 to $24,000,000, keeping the company on track to meet the full year expectation of over $100,000,000 in revenue [7][25] - Adjusted EBITDA loss in Q1 was $14,400,000, within the expected range provided in the last earnings release [7][26] - Scheduled service revenue decreased by 23% year over year, primarily due to the elimination of unprofitable routes and a brief interruption of service in January [26] - On-demand service revenue decreased by 25% year over year, driven by lower sales and flight completions [26] Business Line Data and Key Metrics Changes - The Essential Air Service (EAS) Program represents approximately 40% of revenue, with the company being the lowest cost provider on routes below 500 miles [5][21] - The company returned five older aircraft to lessors during Q1, focusing on operationally efficient Cessna Grand Caravan [10] - Flight completion factors improved to above 92% in the first six weeks of Q2, with a goal to return to 96% prior to route expansion [12] Market Data and Key Metrics Changes - The company operates almost exclusively in the US, with minimal impact from tariffs due to domestic operations and aircraft manufacturing [4][20] - The current economic environment has benefited the company, particularly with lower fuel costs [22] Company Strategy and Development Direction - The company is focused on three growth vectors: expanding air mobility operations, commercial rollout of the regional air mobility software platform, and marketing electrified powertrains for the Cessna Caravan [28] - The transformation plan includes an optimization phase, with a goal to achieve positive adjusted EBITDA in airline operations in 2025 [19][24] Management's Comments on Operating Environment and Future Outlook - Management noted substantial changes in the economic, regulatory, and political environment, but expressed confidence in the company's competitive advantage as a low-cost provider [4][5] - The company anticipates minimal impacts from potential tariffs and is actively managing operations to improve cost structure and efficiencies [20][28] Other Important Information - The company raised an incremental $5,000,000 in funding after the end of Q1 [8] - An interline agreement with Japan Airlines was announced, expanding access to over 435 million customers [12][48] Q&A Session Summary Question: Thoughts on changes to the essential air service budget - Management acknowledged the potential budget cuts but emphasized their competitive advantage as a low-cost operator [31][34] Question: Discussion on core versus non-core scheduled and charter flights - Management identified Hawaii as a core area and discussed the importance of profitability in route selection [35][36] Question: Plans for adding new profitable routes - Management indicated that while they have targeted drafts to exit, some routes are being held longer than planned due to additional subsidies [38] Question: Service interruption details - Management clarified that the service interruption in January was unplanned and related to maintenance issues [47] Question: Potential for more interline agreements - Management expressed excitement about the Japan Airlines partnership and indicated interest in expanding to other carriers globally [48]

Core Insights - Stonegate Capital Partners has initiated coverage on Surf Air Mobility Inc. (NYSE: SRFM) [1] - Surf Air Mobility reported revenue of $28.0 million, adjusted EBITDA of ($6.9) million, and adjusted EPS of $1.27 for the quarter and full year [1] - The company exceeded both revenue and EBITDA guidance, driven by a 39% increase in On Demand service revenue over 4Q23 and a 28% increase for FY24 compared to FY23 [1][5] - Surf Air Mobility is transitioning from the Transformation Phase to the Optimization Phase, with expectations of improved profitability through strategic cost reductions and optimizations, particularly in the latter half of FY25 [1] Financial Performance - Revenue for the quarter and full year stood at $28.0 million [1] - Adjusted EBITDA was reported at ($6.9) million [1] - Adjusted EPS was $1.27 [1] Growth Indicators - On Demand service revenue increased by 39% compared to 4Q23 and 28% for FY24 compared to FY23 [1][5] - The company signed MOUs with seven customers to upgrade approximately 100 aircraft [5] - In 4Q24, Surf Air Mobility secured a $50.0 million term loan in addition to extending the maturity of its secured debt [5]