Wheels Up Experience (UP) - 2025 Q1 - Quarterly Results

First Quarter 2025 Results Wheels Up reported Q1 2025 financial and operational results, highlighting revenue decline alongside significant improvements in profitability metrics and strategic advancements Financial & Operational Highlights Wheels Up reported Q1 2025 revenue of $177.5 million, a 10% decrease year-over-year, yet achieved significant improvements in gross loss and a 51% reduction in Adjusted EBITDA loss, coupled with key strategic initiatives Q1 2025 Key Financial Results (YoY) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $177.5M | $197.1M | (10)% | | Gross Loss | $(1.1)M | $(16.6)M | n/m | | Adjusted Contribution | $22.4M | $2.0M | n/m | | Adjusted Contribution Margin | 12.6% | 1.0% | +12 pp | | Net Loss | $(99.3)M | $(97.4)M | (2)% | | Adjusted EBITDA Loss | $(24.2)M | $(49.2)M | 51% improvement | Q1 2025 Key Operating Metrics (YoY) | Metric | Q1 2025 | Q1 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Gross Bookings | $241.9M | $224.7M | 8% | | Live Flight Legs | 10,895 | 11,754 | (7)% | | Private Jet Gross Bookings per Live Flight Leg | $18,843 | $16,315 | 15% | | Utility | 38.1 | 30.9 | 23% | | Active Users | 6,166 | 10,218 | (40)% | - The company is focused on improving profitability through increased operational efficiency, as evidenced by a $15 million year-over-year improvement in Gross Loss despite a $20 million revenue decline, driven by a 23% increase in Utility[7] - Key strategic initiatives announced or progressing in the quarter include: - Delta Partnership: New corporate accounts are the fastest-growing segment, and a new hybrid commercial/private travel option for European destinations will launch in the summer[1] - Fleet Modernization: A definitive agreement was signed with Gogo to install high-speed satellite Wi-Fi, with installations beginning this summer[4] - Liquidity: An agreement was reached with Delta to extend the $100 million revolving credit facility through September 2026[10] - Shareholder Value: The Board of Directors authorized a $10 million open market share repurchase program[10] Consolidated Financial Statements The company's consolidated financial statements for the quarter ending March 31, 2025, detail a net loss of $99.3 million, with total assets of $1.09 billion and total liabilities of $1.37 billion, resulting in a negative total equity position of $288.1 million, while net cash used in operating activities improved to $47.9 million Condensed Consolidated Statements of Operations For Q1 2025, Wheels Up reported revenue of $177.5 million, a 10% decrease from $197.1 million in Q1 2024, with a loss from operations of $80.8 million, an improvement from the prior-year period, and a net loss attributable to the company of $99.3 million, or $(0.14) per share Q1 2025 vs Q1 2024 Statement of Operations (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $177,530 | $197,101 | | Cost of revenue | $158,424 | $198,260 | | Loss from operations | $(80,766) | $(84,548) | | Net loss | $(99,313) | $(97,393) | | Net loss per share | $(0.14) | $(0.14) | Condensed Consolidated Balance Sheets As of March 31, 2025, the company's balance sheet showed $171.8 million in cash and cash equivalents, a decrease from year-end 2024, with total assets at $1.09 billion and total liabilities at $1.37 billion, resulting in a widened total stockholders' equity deficit of $288.1 million Balance Sheet Comparison (in thousands) | Line Item | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $171,845 | $216,426 | | Total current assets | $298,807 | $332,069 | | Total assets | $1,090,982 | $1,158,011 | | Total current liabilities | $925,404 | $917,284 | | Total liabilities | $1,370,865 | $1,354,239 | | Total equity | $(288,106) | $(202,109) | Condensed Consolidated Statements of Cash Flows In Q1 2025, net cash used in operating activities improved by 35% to $47.9 million, with net cash provided by investing activities at $16.1 million, primarily from aircraft sales, and net cash used in financing activities at $8.7 million, ending the quarter with $207.1 million in total cash, cash equivalents, and restricted cash Q1 2025 vs Q1 2024 Cash Flow Summary (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(47,924) | $(73,794) | | Net cash provided by investing activities | $16,113 | $19,603 | | Net cash used in financing activities | $(8,686) | $(24,314) | | Net decrease in cash, cash equivalents and restricted cash | $(39,405) | $(79,535) | Key Metrics and Non-GAAP Measures This section defines the key operating and non-GAAP financial measures used by the company to evaluate performance, including operating metrics like Total Gross Bookings and Utility for business scale and asset efficiency, and non-GAAP measures such as Adjusted EBITDA and Adjusted Contribution for a clearer view of ongoing operational performance, with detailed reconciliations to their nearest GAAP equivalents Definitions of Key Operating Metrics The company defines its primary operating metrics to measure business scale, platform usage, and operational efficiency, including Total Gross Bookings, Live Flight Legs, Utility, and Active Users, with an updated calculation for Completion Rate and On-Time Performance in Q1 2025 to include wholesale flight activity - Key metric definitions include: - Total Gross Bookings: Total gross spend by customers on all private jet, group charter, and cargo flight services[25] - Live Flight Legs: Number of completed one-way revenue-generating private jet flights[29] - Utility: Total revenue-generating flight hours on the controlled fleet divided by the average number of available aircraft, expressed as a monthly average[31] - Active Users: Unique non-member customers who flew in the period plus all members at period end[32] - The presentation of Completion Rate and On-Time Performance was changed for Q1 2025 to include wholesale flight activity, which was previously excluded, to better align with internal operational evaluation[34] Definitions of Non-GAAP Financial Measures Wheels Up utilizes non-GAAP measures to supplement its GAAP results and provide insight into ongoing operations, with Adjusted EBITDA and Adjusted EBITDAR calculated to assess operating performance by removing the effects of financing, capital spending, and certain non-recurring expenses, while Adjusted Contribution and Adjusted Contribution Margin are used to understand core profitability and scalability by adjusting gross profit for specific non-cash or non-indicative costs within the cost of revenue - Adjusted EBITDA & Adjusted EBITDAR: Calculated by adjusting Net Income for items such as interest, taxes, depreciation, amortization, equity-based compensation, and other expenses not indicative of ongoing operating performance, with Adjusted EBITDAR further adjusting for aircraft lease costs[35][36][37] - Adjusted Contribution & Adjusted Contribution Margin: Calculated by taking Gross Profit (Loss) and excluding depreciation, amortization, and certain other items within Cost of Revenue, with this metric used to assess profitability trends over time[38][39] Reconciliations of Non-GAAP Financial Measures The company provides detailed reconciliations of its non-GAAP measures to the most comparable GAAP figures, showing Adjusted EBITDA improved significantly to a loss of $24.2 million in Q1 2025 from a loss of $49.2 million in Q1 2024, and Adjusted Contribution showed a substantial positive swing, reaching $22.4 million from $2.0 million in the prior-year quarter, boosting the Adjusted Contribution Margin to 12.6% from 1.0% Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss | $(99,313) | $(97,393) | | Adjustments (Depreciation, Interest, etc.) | $75,163 | $48,164 | | Adjusted EBITDA | $(24,150) | $(49,229) | Reconciliation of Gross Profit (Loss) to Adjusted Contribution (in thousands) | Line Item | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Gross profit (loss) | $(1,104) | $(16,554) | | Add back: Depreciation and amortization | $20,210 | $15,395 | | Other adjustments | $3,335 | $3,174 | | Adjusted Contribution | $22,441 | $2,015 | Supplemental Information This section provides a more detailed breakdown of revenue by category and the allocation of specific expenses, highlighting that Membership revenue saw the sharpest year-over-year decline at 45%, whereas Flight revenue, the largest component, decreased by only 2%, with expense details covering costs associated with equity-based compensation, fleet modernization, and business integration Supplemental Revenue Information In Q1 2025, total revenue of $177.5 million was primarily driven by $147.6 million in Flight revenue, with Membership revenue at $9.2 million, a 45% decrease year-over-year, representing the most significant decline among the categories, and Other revenue at $20.8 million, down 29% from the prior year Supplemental Revenue by Type (in thousands) | Revenue Type | Q1 2025 | Q1 2024 | $ Change | % Change | | :--- | :--- | :--- | :--- | :--- | | Membership | $9,189 | $16,854 | $(7,665) | (45)% | | Flight | $147,568 | $150,929 | $(3,361) | (2)% | | Other | $20,773 | $29,318 | $(8,545) | (29)% | | Total | $177,530 | $197,101 | $(19,571) | (10)% | Supplemental Expense Information For Q1 2025, the company allocated $12.7 million in equity-based compensation, with the majority ($11.9 million) in General and Administrative expenses, while fleet modernization expenses totaled $5.1 million, split between Cost of Revenue and G&A, and integration and transformation expenses were $1.2 million Q1 2025 Supplemental Expense Allocation (in thousands) | Expense Type | Cost of revenue | General and administrative | Total | | :--- | :--- | :--- | :--- | | Equity-based compensation | $78 | $11,908 | $12,661 | | Integration and transformation | $363 | $320 | $1,183 | | Fleet modernization expense | $3,057 | $2,018 | $5,147 |