Financial Data and Key Metrics Changes - In Q4 2025, total operating revenues reached $882 million, a 5.6% increase compared to the same quarter in 2024, driven by a recovery in cross-border travel and diversification of revenues [20][21] - The full-year total operating revenues for 2025 were $3 billion, reflecting a 3% decrease from 2024 [24] - EBITDA for Q4 was $328 million with a margin of 37.2%, while full-year EBITDA totaled $988 million, a 13% decrease with an EBITDA margin of 32.5% [24][25] - CASM (Cost per Available Seat Mile) was $0.0829, a 3.2% increase, while CASM ex-fuel was $0.0576, up 1.4% year-over-year [22] Business Line Data and Key Metrics Changes - Ancillary revenues comprised 56% of total operating revenues, indicating a strong performance in this area [4] - The international load factor reached 79% in Q4, up from 77.5% in the first nine months of the year, while the domestic load factor was 89.8% [5][12] Market Data and Key Metrics Changes - The cross-border market showed stable recovery, with improved travel sentiment and positive results from capacity deployment [5][12] - The company plans to allocate most of its incremental capacity to international markets, which now represent approximately 42% of total capacity [19] Company Strategy and Development Direction - The company aims to stimulate demand through its low-fare model, focusing on profitable growth and capital efficiency [6] - A proposed airline group with Viva is expected to enhance access to low-fare travel in domestic and cross-border markets while preserving brand identity [9][10] - The company anticipates a 7% ASM (Available Seat Mile) growth for 2026, with a focus on disciplined capacity deployment [6][31] Management's Comments on Operating Environment and Future Outlook - Management noted that the Mexican economy is showing signs of improvement, with better-than-expected inflation and recovery in consumption trends [6] - The company expects to see a reduction in grounded aircraft and improved fleet productivity as it moves into 2026 [30] Other Important Information - The company ended Q4 with a liquidity position of $774 million, representing 25.5% of the last twelve months' total operating revenues [26] - The average age of the fleet is 6.6 years, with 66% being fuel-efficient newer models [27] Q&A Session Summary Question: What were the key drivers behind the reported tax rate of 89% in the quarter? - The tax rate reflects the application of the actual tax rate for the year, with an effective tax rate of 11.8% for the full year [42][43] Question: How should the 7% capacity growth for 2026 be viewed in terms of domestic versus international mix? - The capacity growth will be skewed towards international markets, with domestic growth expected to be in the low to mid-single digits [45][46] Question: What does the flat fleet count through 2030 mean for multi-year capacity growth and potential CapEx? - The company expects to grow capacity by 7% over the next five years, with growth coming from unproductive fleet being put into service [49][50]

Financial Data and Key Metrics Changes - Total operating revenues for Q3 2025 were $784 million, a 4% decrease compared to Q3 2024 [24] - EBITDA reached $264 million with a margin of 33.6%, aligned with guidance [27] - Net profit was $6 million, translating to earnings per ADS of $0.05 [27] - Cash flow generated by operating activities in Q3 was $205 million, with total liquidity at $794 million [28] Business Line Data and Key Metrics Changes - Domestic load factor reached 89.8%, consistent with last year's levels, reflecting stable demand [6][14] - International load factor was at 77%, prioritizing yield over loads to optimize profitability [14] - Average ancillary revenue per passenger for Q3 was $56, consistently above $50 for eight consecutive quarters [15] Market Data and Key Metrics Changes - The recovery in cross-border demand is evident, with traffic improving month over month [6][15] - Booking trends in the US-Mexico transborder market show sustained improvement compared to last year [40][54] Company Strategy and Development Direction - The company is focused on maintaining a disciplined growth strategy, with a capacity growth outlook of approximately 7% for 2025 [7][23] - Volaris aims to enhance its ultra-low-cost carrier model by expanding ancillary products and optimizing distribution channels [11][21] - The company is adapting its fleet plan to ensure flexibility in response to demand trends [8][31] Management's Comments on Operating Environment and Future Outlook - Management noted that demand momentum is building, with a stable domestic demand and improved travel sentiment in cross-border markets [4][5] - The company expects to close 2025 and enter 2026 stronger and more efficient, with a focus on capturing opportunities and driving sustained profitability [12][36] Other Important Information - The company has a favorable position with an order book of 122 aircraft, with 84% being A320neo to A321neo models [31] - Volaris is leveraging technology to enhance customer service, with 79% of customer interactions now handled through digital channels [22] Q&A Session Summary Question: Can you elaborate on the stronger-than-normal seasonality in international markets and the inflection point in the US-Mexico transborder market? - Management indicated that since mid-August, sales in the US-Mexico transborder market have been above last year's levels, showing optimism for Q4 traffic evolution [40] Question: How many lease returns are expected next year, and how does that compare to this year? - Management expects 17 re-deliveries next year compared to 7 this year, emphasizing the importance of managing capacity in line with consumer demand [42] Question: What is the expected RASM uplift from new initiatives? - Management expects a positive year-over-year impact on RASM from new products starting in 2026, with specific targets to be communicated in future guidance [46] Question: How will the customer mix diversification impact costs? - Management assured that broadening the customer base will not significantly impact costs or complexity, maintaining a low-cost model [48] Question: What is the outlook for grounded aircraft and AOGs? - Management anticipates an average of 32-33 grounded aircraft next year, with a goal of no material impacts from AOGs by the end of 2027 [57][71] Question: What is the expected CapEx for 2026 compared to 2025? - Management indicated that CapEx for 2026 is expected to be higher than the $250 million planned for 2025 due to maintenance and re-delivery investments [61]

Group 1 - The ultra-low-cost carrier model is still viable in the U.S., according to Frontier Airlines CEO Barry Biffle, despite claims from industry peers that it is struggling [1] - Frontier Airlines aims to become the leading low-fare carrier in the top 20 U.S. metropolitan areas and intends to fill the market gap left by Spirit Airlines, which recently filed for bankruptcy protection for the second time in a year [1] - Biffle noted that the domestic airline market is currently oversupplied, which is negatively impacting yields across the industry [2] Group 2 - Biffle predicts that within the next one to two years, there will be a reduction in the number of seats available across both ultra-low-cost carriers and legacy carriers [2] - United Airlines CEO Scott Kirby has criticized the no-frills airline business model, questioning its long-term viability [2][3] - Kirby described the ultra-low-cost airline business model as "an interesting experiment" that has ultimately "failed" [3]