Sun Country Airlines Reports Fourth Quarter and Full Year 2025 Results

Core Insights - Sun Country Airlines reported its fourteenth consecutive profitable quarter and fifth consecutive year of profitability, with Q4 2025 total revenue reaching $281.0 million, the highest fourth quarter on record [1][2] - The company achieved a full year total revenue of $1.13 billion for FY 2025, also the highest full year on record [1][2] Financial Performance - Q4 2025 GAAP diluted EPS was $0.15, while adjusted diluted EPS was $0.17, reflecting a decrease from $0.24 in Q4 2024 [1][3] - For FY 2025, GAAP diluted EPS remained stable at $0.96, with adjusted diluted EPS increasing to $1.10 from $1.05 in FY 2024 [1][4] - Total operating revenue for Q4 2025 increased by 7.9% compared to Q4 2024, while operating income decreased by 30.3% [3][4] Operational Highlights - The company expanded its cargo fleet by eight aircraft, which required adjustments in its scheduled service network, leading to a 9.8% decrease in scheduled service capacity [2][5] - Scheduled service TRASM grew by 8.9% year-over-year, driven by strong demand despite reduced capacity [5][8] - Cargo revenue surged by 67.9% in Q4 2025, primarily due to the additional cargo aircraft [9] Cost and Efficiency - Q4 2025 GAAP operating expenses increased by 12.1%, while CASM rose by 19.1% due to headcount growth and increased maintenance costs [10][30] - The company reported an operating income margin of 6.5% for Q4 2025, down from 10.0% in Q4 2024 [4][40] Balance Sheet and Liquidity - As of December 31, 2025, total liquidity was $302.8 million, with net debt at $364.0 million [12][32] - Cash and cash equivalents increased to $144.7 million from $83.2 million in the previous year [12][32] Future Outlook - Sun Country announced plans to open a new operational base at Cincinnati/Northern Kentucky International Airport in early 2026, which is expected to enhance operational efficiencies [11] - The company is set to merge with Allegiant, with the transaction expected to close in the second half of 2026, pending regulatory approvals [15][16]