Frontier (ULCC) - 2025 Q1 - Quarterly Results

Highlights and CEO Commentary Frontier reported record first-quarter operating revenues of $912 million, a 5% increase YoY, with a net loss of $43 million due to softer March demand - CEO Barry Biffle stated that softer travel demand in March impacted results, but booking trends for May and early summer have stabilized. The company is targeting a return to profitability in the second half of 2025, leveraging commercial investments, capacity optimization, and cost management[3] Q1 2025 Key Financial Metrics | Metric | Q1 2025 Result | YoY Change | | :--- | :--- | :--- | | Total Operating Revenues | $912 million | +5% | | Revenue per ASM (RASM) | 9.17 cents | Roughly flat | | Cost per ASM (CASM) | 9.63 cents | +1% | | Net Loss | $43 million | Increased from $26 million loss | | Diluted Loss Per Share | $(0.19) | Increased from $(0.12) loss | - Operational and strategic highlights for the quarter include: - Ended the quarter with $889 million in total liquidity - Took delivery of four A321neo aircraft - 82% of the fleet is now composed of fuel-efficient A320neo family aircraft - Launched 17 new routes and announced 22 more for the spring[4] Q1 2025 Financial Performance In Q1 2025, Frontier achieved record revenue of $912 million, up 5% YoY, offset by a 7% rise in operating expenses to $958 million, leading to a $43 million net loss Q1 2025 GAAP Financial Summary | Financial Metric | Q1 2025 (GAAP) | Q1 2024 (GAAP) | | :--- | :--- | :--- | | Total operating revenues | $912 million | $865 million | | Total operating expenses | $958 million | $896 million | | Pre-tax loss | $(40) million | $(24) million | | Net loss | $(43) million | $(26) million | | Earnings per share, diluted | $(0.19) | $(0.12) | Revenue Performance Record first-quarter revenue of $912 million increased 5% YoY, driven by capacity growth, but tempered by softer March demand and industry-wide fare discounting - Total operating revenue reached a record $912 million for a first quarter, 5% higher than Q1 2024, on 5% capacity growth, though tempered by softer demand in March[6] Comparative Revenue Metrics | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | RASM | 9.17 cents | 9.16 cents | ~ Flat | | Enplanements | 7.8M | 7.0M | +12% | | Total Revenue per Passenger | $116.33 | $123.53 | -6% | | Load Factor | 74.9% | 72.7% | +2.2 pts | Cost Performance Total operating expenses for Q1 2025 were $958 million, with CASM rising 1% to 9.63 cents and CASM excluding fuel increasing 8% to 7.24 cents - Total operating expenses were $958 million, with fuel expenses at $238 million (average cost of $2.55/gallon) and non-fuel operating expenses at $720 million[9] Comparative Cost Metrics | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | CASM | 9.63 cents | 9.49 cents | +1% | | CASM (excluding fuel) | 7.24 cents | 6.71 cents | +8% | | Average daily aircraft utilization | 9.7 hours | 10.6 hours | -8% | Earnings The company reported a pre-tax loss of $40 million (4.4% margin) and a net loss of $43 million, resulting in a loss per share of $0.19 Earnings Summary | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Pre-tax loss | $40 million | $24 million | | Pre-tax loss margin | 4.4% | 2.8% | | Net loss | $43 million | $26 million | | Loss per share | $(0.19) | $(0.12) | Operational and Balance Sheet Overview As of March 31, 2025, Frontier maintained $889 million in liquidity, with a fleet of 163 Airbus aircraft, 82% of which are fuel-efficient A320neo family models Liquidity At the end of Q1 2025, Frontier's total liquidity stood at $889 million, comprising $684 million in cash and $205 million from an undrawn revolving credit facility - Total liquidity as of March 31, 2025, was $889 million, consisting of $684 million in cash and $205 million in undrawn revolving credit[13] Fleet Frontier's fleet comprises 163 Airbus aircraft, with 82% being fuel-efficient A320neo family models, and 183 additional aircraft committed through 2031 Fleet Composition | Equipment | Quantity | | :--- | :--- | | A320neo | 82 | | A320ceo | 8 | | A321ceo | 21 | | A321neo | 52 | | Total fleet | 163 | - The company has commitments for an additional 183 aircraft (27 A320neo, 156 A321neo) to be delivered through 2031[15] - Frontier achieved a record 107 available seat miles (ASMs) per gallon, a 1% improvement YoY, reinforcing its position as "America's Greenest Airline"[17] Forward Guidance Frontier projects an adjusted loss per share between $(0.23) and $(0.37) for Q2 2025, will not issue full-year EPS guidance, and plans to reduce capacity for the remainder of 2025 Q2 2025 Guidance | Guidance Metric | Q2 2025 Estimate | | :--- | :--- | | Adjusted (non-GAAP) loss per share | $(0.23) to $(0.37) | - The company has reduced planned capacity for Q2 and the remainder of 2025 to be down low single digits YoY, with a focus on adjusting off-peak day schedules[20] - Full-year 2025 adjusted EPS guidance will not be provided due to uncertainty in the demand outlook for the rest of the year[21] Appendix: Financial Statements and Reconciliations This section provides detailed unaudited financial tables for Q1 2025, including statements of operations, operating statistics, and non-GAAP reconciliations Condensed Consolidated Statements of Operations The Q1 2025 income statement shows total operating revenues of $912 million and expenses of $958 million, resulting in a $46 million operating loss and a $43 million net loss Condensed Consolidated Statements of Operations (in millions) | (in millions) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Total operating revenues | $912 | $865 | | Total operating expenses | $958 | $896 | | Operating income (loss) | $(46) | $(31) | | Net income (loss) | $(43) | $(26) | Comparative Operating Statistics Key Q1 2025 operating statistics show a 5% increase in ASMs to 9,949 million and a 12% increase in passengers to 7.8 million, despite an 8% decrease in aircraft utilization Comparative Operating Statistics | Operating Metric | Q1 2025 | Q1 2024 | Percent Change | | :--- | :--- | :--- | :--- | | ASMs (millions) | 9,949 | 9,446 | 5% | | Passengers (thousands) | 7,839 | 7,005 | 12% | | Load Factor | 74.9% | 72.7% | 2.2 pts | | Average daily aircraft utilization (hours) | 9.7 | 10.6 | (8)% | | Total revenue per passenger ($) | 116.33 | 123.53 | (6)% | | CASM (¢) | 9.63 | 9.49 | 1% | | CASM (excluding fuel) (¢) | 7.24 | 6.71 | 8% | | Fuel cost per gallon ($) | 2.55 | 2.93 | (13)% | Non-GAAP Reconciliations This section reconciles non-GAAP metrics to GAAP, showing adjusted net loss matching reported GAAP figures and adjusted EBITDAR at $135 million for Q1 2025 Non-GAAP Reconciliation (in millions) | Reconciliation (in millions) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net loss, as reported | $(43) | $(26) | | Adjusted net loss | $(43) | $(21) | | EBITDAR | $135 | $144 | | Adjusted EBITDAR | $135 | $144 | Non-GAAP Reconciliation (per ASM, ¢) | Reconciliation (per ASM, ¢) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | CASM | 9.63 | 9.49 | | CASM (excluding fuel) | 7.24 | 6.71 |