JetBlue(US:JBLU)2023-10-30 16:00Financial Performance - In Q3 2023, the company reported a revenue decrease of 8.2%, or $209 million, year-over-year, totaling $2.4 billion[105]. - The operating loss for Q3 2023 was $156 million, with a net loss of $153 million, compared to a net income of $57 million in Q3 2022[110]. - Adjusted earnings per share for Q3 2023 was $(0.39), down from $0.21 in Q3 2022[110]. - The company expects Q4 2023 revenue to decrease between 10.5% and 6.5% compared to Q4 2022, while full-year revenue is projected to increase by 3.0% to 5.0%[109]. - For the nine months ended September 30, 2023, the company reported a net loss of $207 million, an operating loss of $163 million, and an operating margin of (2.2)%, compared to a net loss of $386 million and an operating margin of (5.1)% for the same period in 2022[125]. - Operating cash flows improved to $486 million for the nine months ended September 30, 2023, compared to $321 million in the same period of 2022[152]. - Free Cash Flow for the nine months ended September 30, 2023, was $(287) million, compared to $(278) million in the same period of 2022[179]. - Total operating revenues for the three months ended September 30, 2023, were $2,353 million, a decrease of 8.2% from $2,562 million in the same period of 2022[175]. - Total operating expenses for the three months ended September 30, 2023, increased to $2,509 million, up 3.6% from $2,423 million in the same period of 2022[175]. - Operating loss for the three months ended September 30, 2023, was $(156) million compared to an operating income of $139 million in the same period of 2022[175]. - Net loss for the three months ended September 30, 2023, was $(153) million, compared to a net income of $57 million in the same period of 2022[177]. Revenue and Passenger Metrics - Passenger revenue increased by $523 million, or 8.3%, to $6,842 million for the nine months ended September 30, 2023, driven by an 11.1% increase in revenue passengers[126]. - Revenue passengers increased to 10,911 thousand for the three months ended September 30, 2023, up 3.9% from 10,502 thousand in the same period last year[141]. - Revenue passenger miles (RPMs) rose to 14,777 million, a 5.8% increase from 13,963 million year-over-year[141]. - The average fare decreased by 12.3% to $201.73, while passenger yield per mile dropped by 13.9% to 14.89 cents[112]. - Average fare decreased to $201.73, down 12.3% from $229.95 in the prior year[141]. Operating Expenses - Operating expenses increased by $369 million, or 5.2%, to $7,453 million for the nine months ended September 30, 2023, with special items contributing $111 million to this increase[129]. - Salaries, wages, and benefits increased by 17.0%, or $115 million, in Q3 2023, primarily due to a new pilot union contract[117]. - Aircraft fuel and related taxes decreased by 17.8%, or $147 million, with the average fuel price dropping by 23.3% to $2.94 per gallon[116]. - Other operating expenses increased by $103 million, or 10.0%, driven by increased demand and costs associated with ATC delays and weather-related disruptions[137]. - Landing fees and other rents increased by $87 million, or 21.1%, due to rate increases and a 6.4% rise in departures[132]. - Salaries, wages, and benefits rose by $246 million, or 12.0%, primarily due to a new pilot union contract that included a 14% initial pay rate increase[131]. - Aircraft fuel and related taxes decreased by $262 million, or 11.4%, with the average fuel price dropping by 18.0% to $3.02 per gallon[130]. Fleet and Capacity - System capacity increased by 7.1% in Q3 2023 compared to Q3 2022, with available seat miles (ASMs) reaching 17,362 million[112]. - As of September 30, 2023, the total fleet consisted of 296 aircraft, with 231 owned and 65 leased under operating leases[161]. - The average age of the operating fleet was 12.6 years as of September 30, 2023[161]. - The aircraft order book includes 137 aircraft scheduled for delivery from 2023 to 2027, with 56 Airbus A321neo and 81 Airbus A220[164]. Future Outlook and Risks - The company expects operating results to fluctuate significantly due to external factors, including air traffic controller shortages and supply chain disruptions[141]. - The company anticipates continued increases in expenses as it acquires additional aircraft and expands flight frequencies[141]. - The company anticipates using a mix of cash and debt financing for aircraft scheduled for delivery in 2023, with potential increases in fixed costs regardless of financing method[164]. - A hypothetical 10% increase in aircraft fuel costs would result in an additional expense of approximately $312 million over the next 12 months[182]. - As of September 30, 2023, the company has hedged approximately 31% of its fuel requirements for the fourth quarter of 2023[182]. - The company has $3.9 billion of fixed-rate debt, with $113 million subject to floating interest rates[183]. - If interest rates were to increase by 100 basis points, the annual interest expense would rise by approximately $1 million[183]. Special Items and Non-GAAP Measures - Special items for the nine months ended September 30, 2023 included $104 million related to union contract costs and $64 million related to Spirit acquisition costs[138]. - Special items for the three and nine months ended September 30, 2023, included Spirit acquisition costs and union contract costs[172]. - The company believes that non-GAAP financial measures provide useful supplemental information for comparing results to others in the airline industry[169]. - The company is unable to provide a reconciliation of CASM ex-fuel guidance to GAAP CASM due to the unpredictability of certain excluded items[172].