JetBlue Announces Second Quarter 2024 Results

Exceeded second quarter guidance targets

Introducing JetForward, the evolution of JetBlue's strategy to restore profitability

Targeting $800M - $900M of incremental EBIT (1) in 2027

JetBlue Airways has reported its financial results for the second quarter of 2024.

"We closed the first half of 2024 with meaningful year-over-year improvements in our operation and exceeded our second quarter guidance through strong execution, early evidence the changes we are implementing as part of our refocused strategy are yielding positive benefits," said Joanna Geraghty, JetBlue's chief executive officer. "Today, and as the year progresses, we are excited to share more details about JetForward, our strategic framework to return JetBlue to sustained profitability, and the four priority moves aimed at driving significant value over the coming years.

"These include boosting reliability and doubling down on our commitment to caring service to improve satisfaction and drive cost savings; reinvesting in building the best leisure network on the East Coast, where we are positioned to win; enhancing our existing product offerings and loyalty perks to better deliver the elevated and differentiated experiences our customers want; and keeping our costs low so that we can continue to offer customers exceptional value in the sky as we build a secure financial future for JetBlue."

"In the second quarter, we continued to implement our JetForward strategy with the announcement of more significant network changes. We are actively reinvesting in our core geographies in New York, New England, Florida and Puerto Rico, while exiting routes and BlueCities that don't meet our financial hurdle rate. As we progress through the second half of the year, we'll be announcing additional initiatives designed to further enhance our customer value proposition, close the gap in our product offering to our peers and drive significant financial benefit," said Marty St. George, JetBlue's president.

Four Priority Moves Underpin $800M - $900M Targeted Incremental EBIT from 2025 - 2027

Reliable & Caring Service

Improving on-time performance through multiple approaches including investments in tools and technology, designed to enable better planning and recovery.

Delivering outstanding customer service and a consistent experience, from pre-booking to post-travel.

Best East Coast Leisure Network

Refocusing our network around leisure flying originating in New York, New England, Florida and Latin geographies.

Recently announced new routes to meet our core customers' needs by doubling down on leisure flying in New England, including adding Manchester, New Hampshire to our network, the tenth airport with JetBlue service in New England.

Announced four tranches of network changes to-date culminating in 15 BlueCity closures and over 50 route exits as we reduce unprofitable flying.

Products & Perks Customers Value

Enhancing our product offerings and loyalty perks to attract customers that value high quality and premium experiences.

Optimizing product merchandising to maximize revenue potential, including through the recent addition of a complimentary carry-on bag to our Blue Basic fare.

A Secure Financial Future

Sustaining our historical cost advantage through our new business cost transformation program, enabled by data-science driven optimization, new technology investments, and labor & infrastructure productivity, which is forecasted to drive $175 million of structural cost savings through 2027.

Restoring balance sheet health through capital discipline, including deferring approximately $3.0 billion of capital expenditures through 2029, designed to also improve our cash flow outlook.

" While many of these underlying initiatives will take time to ramp to their full potential, with the strong foundation of JetForward, we are poised to generate $800 - $900 million of incremental EBIT from 2025 through 2027 and expect the benefit to be realized evenly over those three years," said Ursula Hurley, JetBlue's chief financial officer. "We are setting ourselves on a path to restore our balance sheet health, and in support of securing our financial future, we are announcing an incremental aircraft deferral of approximately $3 billion of planned capital expenditures. Our focus going forward will be on driving value from our existing asset base and, ultimately, generating positive free cash flow."

Second Quarter 2024 Financial Results

Net income for the second quarter of 2024 under Generally Accepted Accounting Principles ("GAAP") of $25 million or $0.07 earnings per share. Excluding special items, adjusted net income for the second quarter of 2024 of $26 million (1) or $0.08 (1) earnings per share.

Second quarter 2024 system capacity decreased by 2.7% year-over-year.

Operating revenue of $2.4 billion for the second quarter of 2024, down 6.9% year-over-year.

Operating expense of $2.4 billion for the second quarter of 2024, a decrease of 0.1% year-over-year.

Operating expense per available seat mile ("CASM") for the second quarter of 2024 increased 2.6% year-over-year.

Operating expense, excluding special items for the second quarter of 2024, increased 0.9% (1) year-over-year.

Operating expense per available seat mile, excluding fuel, other non-airline operating expenses, and special items ("CASM ex-Fuel") (1) for the second quarter of 2024 increased 3.7% (1) year-over-year.

Average fuel price in the second quarter of 2024 of $2.87 per gallon.

Second Quarter 2024 Key Highlights

Continued implementation of refocused strategy through network optimization announcements, improved merchandising efforts and initial progress on multi-year reliability initiative.

Delivered improved operational performance year-over-year with a completion factor of 98.8%, up from 97.8% in 2Q23.

Progressed on our $300 million 2024 revenue initiative target, delivering ~$140 million of incremental top-line benefit year-to-date.

Executed on our cost initiatives, as evidenced by structural cost program savings of ~$145 million to-date and fleet modernization cost avoidance of $83 million to-date.

Ended the quarter with ~$1.6 billion in liquidity, excluding our undrawn $600 million revolving credit facility.

Outlook

"As we execute on our strategy to return to profitability, we remain focused on delivering on our near-term financial goals. In the second half, we expect sequential year-over-year unit revenue momentum to bolster the top-line, supported by our $300 million of revenue initiatives and the continuing normalization of competitive capacity in our core geographies," said Marty St. George.

"We've faced a number of unit cost headwinds this year, including approximately one point of pressure from the change in recognition of Pratt & Whitney compensation and one point from lower capacity than planned, yet we are maintaining our full year CASM-ex Fuel (1) guidance and now expect it be in the range of 6.5% - 8.5% for the full year," said Ursula Hurley. "We remain committed to cost execution in the second half of the year, when we expect our structural cost program to ramp to run-rate and we introduce our new cost transformation program as part of JetForward."

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