Core Insights - Sun Country Airlines reported a total revenue of $264 million for the second quarter of 2025, marking a 3.6% increase compared to the same period in 2024 [3][8] - The company achieved a GAAP diluted EPS of $0.12 and an adjusted diluted EPS of $0.14, reflecting significant year-over-year growth [2][4] - The airline has successfully integrated additional cargo aircraft into its operations, with expectations to have all 20 freighters in service by the end of the third quarter [2][5] Financial Performance - Total operating revenue for the second quarter was $263.6 million, up from $254.4 million in 2024, representing a 3.6% increase [3] - Operating income increased by 31.5% to $16.3 million, with a GAAP operating margin of 6.2% and an adjusted operating margin of 6.8% [3][4] - Net income for the quarter was approximately $6.6 million, a 263% increase from $1.8 million in the previous year [3][4] Cargo and Charter Operations - Cargo revenue surged by 36.8% to $35 million, driven by a 9.5% increase in cargo block hours and new contract rates with Amazon [9][5] - Charter revenue also saw a 6.4% increase, totaling $54 million, although it was slightly below the growth rate of charter block hours [8][9] Capacity and Demand - The company experienced a 3.9% decline in total available seat miles (ASMs) due to a strategic reduction in passenger service to accommodate cargo growth [2][7] - Scheduled service TRASM increased by 3.7%, indicating robust demand despite a 6.2% decrease in scheduled service ASMs [2][8] Cost Structure - CASM increased by 6.3%, while adjusted CASM rose by 11.3%, primarily due to reduced scheduled service capacity [5][10] - Total operating expenses increased by 2.2% year-over-year, reflecting the impact of rising landing fees and airport rent [10][11] Balance Sheet and Liquidity - As of June 30, 2025, total liquidity stood at $207 million, with net debt at $431 million [12][13] - Cash and cash equivalents decreased to $37 million from $83.2 million in the previous year, indicating a need for careful cash management [12][32] Fleet and Future Outlook - The airline's fleet included 45 passenger aircraft and 19 cargo aircraft as of June 30, 2025, with plans to expand the cargo fleet further [14][30] - Guidance for the third quarter of 2025 anticipates total revenue between $250 million and $260 million, reflecting a modest growth outlook [15]