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Image source: The Motley Fool. Monday, Aug. 3, 2026 at 9:00 a.m. ET Managing Director of Investor Relations - Sherry Wilson Chief Executive Officer - Gregory Anderson Chief Commercial Officer - Drew Wells President and Chief Financial Officer - Robert Neal Operator: Thank you for standing by. My name is Rebecca, and I will be your conference operator today. At this time, I would like to welcome everyone to the Allegiant Travel Company Second Quarter 2026 Earnings Call. [Operator Instructions] I would now like to turn the call over to Sherry Wilson, Managing Director of Investor Relations. Please go ahead. Sherry Wilson: Thank you, and good afternoon, everyone. Welcome to Allegiant Travel Company's Second Quarter 2026 Earnings Call. On the call with me today are Greg Anderson, Chief Executive Officer; Drew Wells, Chief Commercial Officer; and Robert Neal, President and Chief Financial Officer. Earlier this afternoon, we issued our second quarter earnings release, which is available on the Investor Relations section of our website, along with the supplemental materials accompanying today's call. We ask that you refer to those documents as we walk through our results. The company's comments today will contain forward-looking statements, including our third quarter and full year 2026 outlook, statements regarding the integration of Sun Country and expected synergies and other statements concerning our future performance and strategic plans. These statements are subject to risks and uncertainties, and actual results could differ materially from those anticipated. For additional information, please refer to the safe harbor language in this afternoon's earnings release and our filings with the SEC. We will also be discussing non-GAAP financial measures. A reconciliation of these measures to the most directly comparable GAAP measures, where available, is included in the earnings release posted on our Investor Relations website. Before we begin, a brief note on comparability. Second quarter results are presented in this afternoon's earnings release, include the full quarter of Allegiant as well as Sun Country results from May 13, the date of acquisition, through June 30. Prior year results are Allegiant stand-alone. In order to provide the most meaningful commentary, some results will be discussed on an Allegiant stand-alone basis on today's call and will be noted as such. Outlook commentary on today's call is generally for the combined entity, unless otherwise specified. Finally, in order to fully outline the results of the combined entity, our prepared remarks today are a bit longer than usual. [Operator Instructions] With that, I'll turn the call to Greg. Gregory Anderson: Thank you, Sherry, and thanks to everyone joining our call. I also want to welcome the Sun Country team members that are on the call for the first time, as part of the Allegiant family. We are thrilled to have you with us. So let me begin with our results. The second quarter delivered record quarterly revenue with both Allegiant and Sun Country achieving year-over-year TRASM improvement of more than 20%. Importantly, unit revenue growth outpaced unit costs, driven in part by strong execution across several new commercial initiatives. This performance helped us lead the industry in operating margin for the third consecutive quarter, underscoring the strength and resilience of both stand-alone business models and the exceptional contributions of our team members. We delivered strong operational results, including industry-leading controllable completion and mishandled bag performance, while in-flight NPS remains very healthy. These achievements are even more impressive given we delivered them while closing the Sun Country acquisition and beginning integration. June, our first full month post close in a peak summer demand period was particularly strong for both companies. We are excited about what we can achieve together, and we remain focused on disciplined growth from a strong operating foundation and our performance shows we are doing just that. And so while I'm pleased with the quarter's results, I'm proud of why we believe they are sustainable. Our performance is supported by a distinct competitive moat that is difficult to replicate. First, outstanding service to our customers is the foundation of our business and is the key to building a loyal customer base that continues to fly with us. Roughly 70% of our customers are repeat flyers. Second, our operating philosophy is the engine behind our success. We run a low utilization model, maximizing flying during high demand periods, while reducing capacity on days that do not meet our financial hurdles. Third, owning our aircraft at attractive prices gives us significant operational flexibility and adds to our cost advantage versus our peers. MAX deliveries are contributing meaningfully to our results with these aircraft representing 21% of scheduled service ASMs in the second quarter, and this is up from 11% during the same period last year. Together with Sun Country, our well-timed MAX order gives us valuable aircraft access and expands our attractive route opportunities. Fourth, our deep community relationships create powerful local brand equity in markets we serve. Together, Allegiant and Sun Country are the #1 or #2 carriers in roughly 95% of our originating markets. And finally, our strong balance sheet is a critical advantage. Thanks to our deleveraging efforts over the past year and our combination with Sun Country, an already strong balance sheet is even stronger. The true sustainability of our business comes from checking all of those boxes. And in short, we are better positioned today than at any point in our history. Next, I want to turn to our commercial initiatives, which are gaining real momentum. Over the past 2 years, we've modernized our commercial technology, and we are now building on that foundation with enhanced digital, data and distribution capabilities as we build greater flexibility to personalize customer offerings. Previous highlighted initiatives such as Allegiant Extra, improved bundling and schedule and network optimization continue to mature and are contributing meaningfully to our TRASM outperformance. I'm also encouraged by the new initiatives our teams continue to advance. Our cobrand credit card is a clear example with remuneration to us up 24% year-over-year. Coupled with planned enhancements to this program, we remain confident we can double cobrand remuneration over time from 5% of revenue today to 10%. Third-party distribution is another example. Our recently launched Expedia partnership marks Allegiant's entry into OTAs. Retaining control of our brand, product offering and customer relationship is nonnegotiable. And our direct API connection with Expedia enables us to reach new travelers while complementing, not replacing the direct channels that remain at the core of our strategy. Additionally, building on the success of Allegiant Extra and strong demand for premium products, we recently announced plans to debut Allegiant First, which will be phased in on select aircraft in 2027. Together, these initiatives further strengthen our customer value proposition and are expected to support sustained earnings momentum in the years ahead. Turning to the integration. A quick close of our Sun Country acquisition reflects strong team alignment and early momentum. We remain very confident in the synergies we outlined and both airlines continue to perform well independently. Importantly, we have already made some good progress with our integration. Customers can now search for flights across both airlines, access a broader range of destinations and complete bookings through a redirect to the operating carrier. Our commercial teams are beginning to form a holistic view of the combined network with an eye towards the future of optimizing schedules and route decisions based on demand, financial returns and the seasonal strength of each network. Our procurement teams are finding ways to streamline the supplier base and leverage the combined company's scale. In fact, in the coming days, we will integrate our Las Vegas Airport real estate. On the regulatory front, we submitted our single operating certificate transition plan to the FAA and are targeting approval in the first half of 2028. That said, over the past few months, Sun Country has experienced elevated pilot attrition, concentrated among its junior MSP pilots and largely driven by increased hiring at the largest carrier in the Twin Cities. In response to this attrition and elevated fuel prices, we are reducing off-peak capacity in the Twin Cities during the back half of the year. We have already taken steps to expand training classes in preparation for the first quarter of 2027, and the supply of qualified pilots remains strong. Our training classes are full and these pilots are scheduled to enter service later this year. We are confident this capacity reduction is temporary, and we expect to grow MSP capacity in 2027 through a combination of Sun Country and Allegiant flying. Turning to our Allegiant pilots. We're pleased to have reached a new collective bargaining agreement with nearly 80% voting in favor. This is an important milestone that recognizes the hard work of our pilots while preserving the work rules that support our differentiated scheduling model. I want to thank both negotiating teams for their tireless work in getting this agreement across the finish line. And looking ahead, we expect unit revenue growth to be in line with the second quarter's 24.6% increase for the third quarter. We also expect the combined company to generate an operating profit in the third quarter, a meaningful improvement from the modest operating losses reported in the same period over the last 2 years despite much lower fuel prices at that time. As a reminder, the September quarter is seasonally the weakest period for both carriers. For the full year, we continue to see broad-based demand supported by strong bookings, and we will remain aggressive in managing capacity through this volatile fuel environment. As a result, we expect full year 2026 EPS for the combined company to be at least $6 per share. This assumes fuel per gallon at $3.75 for the remainder of the year, which reflects the recent forward curve. I should note that fuel prices remain volatile and for reference, a $0.10 increase in fuel is worth roughly $0.50 of earnings per share in the combined companies. We are proud of our ability to navigate a wide range of challenges while remaining an industry profitability leader. We remain focused on what we can control, delivering great service to our loyal customers, operating safely and reliably, maintaining capacity discipline, managing costs tightly and seamlessly integrating Sun Country to unlock operating synergies. And before I hand things over, I want to again thank our team members across both airlines. This quarter, we delivered strong operating and financial results while closing a historic transaction. For the full year, we remain on track for margin expansion despite significantly higher fuel costs. Allegiant is better positioned than ever, and our commitment to building the leading leisure carrier in the U.S. remains unwavering. Every single day, our team is focused on delivering continuous improvement. And finally, please mark your calendars for December 7 in Las Vegas when we plan to host an Analyst Day. We look forward to sharing a deeper look at our business, providing an integration update and outlining our long-term financial framework to highlight the full value of the combined company. With that, I'll turn it over to Drew to discuss our commercial performance. Drew Wells: Thank you, Greg, and thanks, everyone, for joining us this afternoon. Stand-alone Allegiant finished the second quarter with $776 million in total revenue, up 16.1% versus the prior year. Despite 6.8% less system capacity in the quarter, we held passenger counts nearly flat and set yet another record revenue quarter, overtaking the first quarter of 2026. Similarly, the stand-alone Allegiant 2Q TRASM of $0.1442, up 24.6% year-over-year, set an all-time Allegiant [indiscernible]. The gains came from nearly every lever, yield up more than 40%, load factor up approximately 4 points, and third-party per passenger up more than 30%. In a quarter with many incredible revenue data points, my favorite is this, stand-alone Allegiant scheduled service air revenue increased $102 million versus last year, more than covering the $99 million increase in fuel expense. Zooming out to the combined company, we produced $943.5 million across all lines of business, including Sun Country brand contribution from May 13 close to quarter end, highlighting some full quarter figures for context. The $14.5 million stand-alone Allegiant fixed fee revenue was down approximately 14.7%, but in line with expectations. Stand-alone Sun Country fixed fee revenue of $65.7 million and Sun Country cargo revenue of $50.6 million were record quarters for stand-alone Sun Country for full quarter 2Q '26. Focusing on the Sun Country brand a bit, the record cargo revenue perhaps comes as no surprise. During the 3Q '25 Sun Country earnings call, cargo expansion was discussed as a focus. And in January, we mentioned two additional airplanes coming online this summer. As a reminder, at stand-alone Sun Country and in the current state of integration, cargo flying is less efficient on a crew hour basis and will typically draw from scheduled service resources during the ramp-up period as additional aircraft enter the cargo program. As a result of the additional aircraft coming online, we expect cargo revenue to ramp slightly into the third quarter as compared with the second. One final reminder on the cargo front. The program is a fuel pass-through. Fixed fee charter programs represent a fuel pass-through as well. And in combination with cargo, they provide a very predictable foundation in any environment, on top of which we can continue to drive highly flexible scheduled service options to match our capacity with demand. Our long-term fixed fee and cargo programs, including both brands, constitute approximately 9% of our trailing 12-month revenue, and we opportunistically fill in the broader schedule with additional fixed fee flying. On the scheduled service side, the Sun Country stand-alone TRASM of $0.1264 was also a robust 22% higher year-over-year in the full second quarter. And while the commercial approach is quite similar between the brands, it is important to note that the Sun Country stage length is nearly 20% longer than the Allegiant one. In fact, when comparing the trailing 12 months, more than 85% of Sun Country brand flights are longer than the average Allegiant brand flight. Turning to the network. As noted earlier this year, 39 markets began operation across the first 2 quarters of the year in the stand-alone Allegiant network and represent between 9% to 10% of the second and third quarter ASMs. We are encouraged by the outperformance of the new market additions through the summer. And as we look to start optimizing our combined networks into 2027, there is tremendous potential. While Allegiant strength is connecting underserved, small and midsized communities to leisure destinations, Sun Country brings a powerful position in Minneapolis, St. Paul. Together, these brands create a network that is broader, more flexible and more resilient. The core theme through the quarter for both stand-alone Allegiant and stand-alone Sun Country Networks was the continued exceptional demand. And while the macroenvironment certainly played a role, we were very deliberate in our peak focused schedule. Even with the overall reduction of 6.2% scheduled service ASMs, stand-alone Allegiant was able to grow peak days approximately 1%. The leisure customer remains incredibly resilient and all indications, internal and external, are that travel spend remains strong, even into the fall. Most importantly, cash sales were up double digits through July despite forward capacity remaining slightly down year-over-year. This amounts to an expectation of third quarter total revenue of approximately 16.5% against combined airline-only third quarter 2025 revenue of approximately $808 million. Specific to scheduled service, we expect third quarter ASMs for the combined entity to be down approximately 5.5% from the prior year pro forma base of 6.1 billion ASMs. Two dynamics are at work in that figure. First, in response to the fuel environment, both Allegiant and Sun Country brands have reduced off-peak flying in the back half of the third quarter. Second, as Greg discussed, Sun Country brand additionally pulled down September capacity in response to elevated pilot attrition and the planned increases in cargo flying. On our first quarter call, I indicated stand-alone Allegiant capacity would be flat to slightly down in the third quarter. With fuel remaining elevated, stand-alone Allegiant will now be down a little more than 3%. No other business model is better positioned to remain flexible in sculpting the schedule to protect the best flying through peak periods and peak days of week. While fuel continues to be volatile, I expect a downward bias to fourth quarter ASMs for the combined airline and a full year number to be down mid-single digits. Some of the support for the third quarter unit revenue outlook will come from our first external distribution connection with Expedia. After a measured rollout, we were 100% live on July 10. In the few weeks since launch, approximately 3% of bookings have come from the Expedia network with meaningfully more than half of bookings coming from net new customers to Allegiant. We're thrilled with the early returns as an acquisition channel. Beyond the near-term booking contribution, the channel helps address one of the unique challenges of operating such a broad network by providing a scalable way to build awareness, attract new customers and accelerate demand in newer markets. In past Sun Country filings, they've noted approximately 20% of bookings from external distribution, part of that coming from Expedia. We intentionally launched with a simplified airfare-only offering and over time, expect to enhance the integration with additional products and capabilities, while preserving the flexibility that has long been a hallmark of our commercial approach. In the meantime, we still maintain control of ancillary sales post purchase for these bookings. Expedia isn't the only commercial initiative underway, however. Our Navitaire platform, an initiative we've discussed at length on prior calls, is paying an added dividend in the integration. With Sun Country running on the same Navitaire passenger service system back end, the platform combination is meaningfully simplified. Even so, we will have a lot of decisions to make around policy and product alignment in the coming weeks and months. Our move to complimentary onboard beverages is the first of those and a true win for our customers' experience on board. And while this will pose a mild near-term headwind to air ancillary revenue and commissary costs, we expect to grow third quarter air ancillary per passenger. That expectation comes on the heels of air ancillary per passenger being roughly flat year-over-year for the last 4 quarters as our larger focus on conversion and in turn driving yield success, produced the intended total revenue results. Into the third quarter, the improvements Greg referred to on our product merchandising and dynamic pricing capabilities, continue to mature and are beginning to impact a larger swath of bookings, supporting that increase in air ancillary per passenger. Our Allegiant Allways Rewards card program contribution continues to excel. Bank compensation increased 24% for 2Q '25 and new cardholder acquisition ramped slightly higher than that. In fact, when official numbers come across, we expect July 2026 to set a record for new accounts. We expect continued momentum into the quarter before hitting more challenging comps from the end of 2025. I expect to have more detail to speak to during our Analyst Day later this year. Lastly, we are excited about the recent announcement of our new premium product coming spring 2027, Allegiant First. After Allegiant Extra exceeded our expectations by such a wide margin, this was a logical next step and has been a couple of years in the making. The success of Extra clearly demonstrates the value of our customers and their appetite for premium services and products. The product is based on the elements most important to those customers as shared directly by them, including extra legroom and recline. The entire cabin will feature a new Recaro seat design with the Extra cabin and main cabin each seeing improvements, including the seat cushion and power available throughout. The new layout is a reduction of just two seats from our current 190-seat max layout, with the upside of eight premium seats. I also look forward to providing more detail, including expected economics about Allegiant First, during our Analyst Day. Demand persisted through the quarter at incredible levels and looks strong into the third quarter, even into the off-peak fall. When coupled with the initiatives we've talked about, we're creating significant short and long-term tailwinds while maintaining the core scheduling flexibility principles that make the now larger Allegiant story so compelling. I'd like to thank the commercial teams that have worked so hard to deliver these incredible results and to all of our team members for making travel and experiences possible for millions. With that, I'd like to turn it to Robert. Robert Neal: Thank you, Drew, and good afternoon. I appreciate everyone joining us today. 2026 has already been an eventful year, and the strength of the model is alive and well in our results. My comments will reference financial results on an adjusted basis and year-over-year comps will reference prior year Allegiant airline-only results unless otherwise noted. For the second quarter, the combined entity produced pretax income of $64.5 million, with Sun Country contributing $13.4 million during the stub period, resulting in a consolidated earnings per share of $2.19. We delivered a consolidated operating margin of 9.2%, which is the best of any U.S. carrier this quarter, and generated nearly $158 million of EBITDA with Sun Country contributing $29.7 million and yielding a consolidated EBITDA margin of nearly 17%. These results came in well ahead of our June 30 guidance update with the outperformance driven primarily by a $0.06 improvement in fuel price, along with some nonfuel cost shifts, which I'll touch on in a moment. Drew has already covered the revenue detail, so I'll simply note that record revenue performance, cost discipline across the businesses and strong ops execution made this quarter successful. Turning to costs. Second quarter nonfuel unit costs for Allegiant on a stand-alone basis were $0.0817, up 6.4% year-over-year on capacity down 6.8%. CASM ex fuel came in modestly better than we were estimating in our recent guidance update and ahead of our initial expectation for a sequential step-up from the first quarter. Primary drivers of that beat included maintenance and labor expenses, some of which we expect to shift into the third quarter. Looking at the cost trajectory through the remainder of the year, as Greg noted, we are pleased to have reached a new CBA with legacy Allegiant pilots, providing well-deserved compensation along with other benefits. While wage rates for Allegiant pilots will step up just about 2% through the remainder of the year from the bonus rates we were accruing, these wages will now become subject to 401(k) contribution and other benefit elements, creating incremental cost pressure in the back half of the year at the legacy segment. However, we continue to expect increased crew productivity to be achieved ahead of the March peak, at which point that cost pressure should begin to abate. With the timing elements previously mentioned, removal of planned capacity from our schedules and incremental pilot benefit costs discussed, we now expect the third quarter to mark our peak CASM ex year-over-year increase. During the second quarter, we invested $188 million in capital expenditures on a combined basis, including $157 million in aircraft-related investments and $31 million in other CapEx. In addition, we had $18 million of deferred heavy maintenance spend across the two airlines. For the full year, we have updated our CapEx outlook to approximately $850 million. The increase from our prior guide includes capital spending in the Sun Country segment as well as incremental PDP payments for future aircraft as we've now aligned our 2027 aircraft delivery estimates to contractual commitments, following the much improved delivery performance at Boeing this year. We ended the quarter in a strong financial position with total available liquidity of $1.3 billion, including $1.1 billion in cash and investments and $250 million in undrawn revolvers. Total debt at quarter end was $2.8 billion and net debt was $1.7 billion with pro forma net leverage of approximately 2.6x for the combined entity. During June, we completed the refinancing and upsize of our senior secured notes, issuing $650 million in aggregate principal amount. The new notes are due in 2031 and carry a coupon of 7.125%. We were very pleased with the level of subscription and overall execution of the transaction. I want to recognize our finance, accounting and treasury teams at both airlines for their work in getting this done and for moving at such pace during the quarter to support this right on top of the acquisition closing. Reflecting the new bond terms as well as Sun Country interest, we are expecting $43 million in net interest expense in the third quarter. As we look at liquidity and leverage through year-end, there are a few things to keep in mind. First, we expect to pay out our pilot retention bonus of approximately $275 million in the coming weeks. This is inclusive of payroll taxes and will be funded from cash on the balance sheet. This is a planned, discreet use of cash that has been fully contemplated in our liquidity planning, and the balance sheet has the strength and flexibility to absorb it without the need to seek further financing commitments. And second, I wanted to touch on some of the financing commitments we've disclosed during this year. Early in the second quarter, we took a proactive approach to liquidity planning, mindful of a sharp rise in fuel costs, an accelerated closing time line for Sun Country, an anticipated payout of the pilot retention bonus, upcoming 2026 fleet CapEx and the 2027 maturity of our senior secured notes. We raised more than $750 million in commitments for aircraft and PDP financing in addition to the upsized bond refinance I just mentioned. We had drawn approximately $200 million at the end of the quarter with the remaining $550 million available for drawing into 2027 with significant flexibility. With this in mind, we do not anticipate the need for additional financing commitments until next year and currently expect remaining 2026 aircraft deliveries to be unencumbered at year-end. Taken together, we expect net leverage to move up slightly and reach its peak following payout of the retention bonus. Cash as a percentage of trailing 12-month pro forma revenue stood at 27%, which remains a bit higher than we need. So you'll likely see us carry less cash on hand by year-end, especially considering prearranged financing. And moving to fleet. We ended the quarter with 193 aircraft in the combined operating fleet, including 105 A320 family aircraft, 66 737 passenger aircraft and 22 737 cargo aircraft, which are owned or leased by our cargo customer. 69 of these airplanes are operated on the Sun Country certificate, while the remaining 124 are operated by legacy Allegiant. We've taken delivery of a single 737 MAX aircraft in July and expect six additional MAX deliveries through year-end. This will result in six 737 MAX aircraft entering service in the second half, offset by seven aircraft retirements, leaving the year-end operating fleet count for the combined entity at 192. In addition, we have three 737NGs leased to other operators and scheduled to return to us through 2029. Looking further out, our 2027 MAX aircraft will deliver with the new Allegiant First configuration Drew highlighted. These airplanes will operate with just two fewer seats as compared to our existing MAXs, preserving our competitive unit cost profile, while increasing our premium seat offering. At this time, we are planning for the new cabin only on new deliveries and have not yet contemplated retrofit on the in-service fleet. We can make broader fleet-wide decisions after we've taken some time to gather further information from both airlines, and we expect to update on that program at our December 7 Analyst Day. More broadly, fleet flexibility underpinned by aircraft ownership continues to be a key competitive advantage for the company. Now turning to our earnings outlook. For the third quarter, we expect combined entity scheduled service capacity to be down approximately 5.5% year-over-year. Based on an assumed fuel price of $3.80 per gallon, we expect an operating margin of 2% at the midpoint and a consolidated loss per share of approximately $0.50 based on an assumed share count of 27.3 million. This guide is reflective of another quarter of margin improvement year-over-year despite the significantly higher fuel price. As a reminder, the third quarter is the softest seasonal period of the year at both airlines. We are maintaining our disciplined approach to capacity with reductions focused on off-peak day of week and shoulder season flying, which ties directly to the cost cadence I discussed a moment ago. For the full year, we now expect consolidated earnings per share of greater than $6 based on an assumed share count of 23.9 million. This number assumes a fuel price per gallon of $3.80 for the third quarter and $3.70 for the fourth quarter. Our ability to flex capacity and response to changing industry headwinds such as higher fuel, continues to position Allegiant as the leading carrier in leisure travel. On the integration, the team is working hard to identify and capture synergies across the combined business, and we remain confident in a minimum of $140 million in run rate synergies expected by 2029. As we continue working through the data, we'll provide further updates on both the size and timing of synergy capture at our upcoming Analyst Day. In closing, I'd like to thank our more than 9,000 team members at Allegiant and Sun Country for their tremendous efforts and unwavering professionalism as we are hard at work on integrating the 2 airlines, while continuing to deliver unbeatable value for our customers day in and day out. And with that, operator, this concludes our prepared remarks. We can now begin the Q&A portion of the call. Operator: [Operator Instructions] And your first question comes from the line of Atul Maheswari with UBS. Atul Maheswari: I know we're not talking 2027 yet, but do you have any preliminary thoughts around capacity plans for next year? And then related to that, now that the pilot deal is done, what capacity growth do you need to fully leverage cost inflation next year? Gregory Anderson: Atul, it's Greg. I'll kick it off, just maybe more high level, and Drew may want to add some on his thoughts for next year. But the way we think about capacity at Allegiant here is that we need to earn the right to grow and that the returns in the environment, they should drive that growth. We're not just going to grow for growth's sake. I'd like to see more flying in the peak periods. I was impressed by what Drew and team have been able to do this year in '26, where we've had less capacity overall. But in the peak periods, we were up a point in capacity. And just as a philosophy, the fleet flexibility really supports our discipline around capacity growth. But Drew, do you want to add anything, how you're thinking about it in the near term? Drew Wells: Maybe just at kind of the highest level, I think we've communicated in the past that our kind of mature run rate would be maybe in the mid-single digits to the higher single digits, such that, to Greg's point, the environment dictates. I think fuel will obviously be the biggest driver in how much we're able to fly next year. There's obviously some slack in the schedule relative to what we have pulled back this year. And then I don't know if Robert wants to talk to fleet at all, but we have a number of MAX deliveries next year, but -- which will provide us with the ultimate flexibility on how much we'd like to grow into the year. Robert Neal: Sure. Atul, yes, I think we've shared in the past that 2027 is our peak year for quantity of aircraft deliveries from our firm order. So we do have a bit of a step-up in available fleet next year. I don't really think of that specifically as growth. I think that's an option for growth. But like Greg said, we'll earn the right to grow based on how the business is performing, and we just have a lot of flexibility to retire some of our older aircraft. Operator: Your next question comes from the line of Scott Group with Wolfe Research. Scott Group: So I'm wondering, I know the guidance was sort of all on a consolidated basis. Just I guess a two-parter, like I know this quarter, you reported consolidated but gave us a breakdown of Allegiant for Sun Country. Are you going to continue to do that for the time being? And I guess, assuming that you are -- any way you can help us break down some of the pieces of the guide between Allegiant and Sun Country in terms of some of the margins and earnings and maybe some of the RASM and CASM commentary, that would be helpful. Robert Neal: Scott, it's BJ. Yes. So how we reported today, I think, is how you should expect things to look at least through the end of the year. So we would report two business segments being legacy Allegiant and Sun Country. We may continue doing that through 2027. There's some materiality tests that we have to look at. And so we'll make that decision as we get closer to next year. I do think we will continue to -- we will break out cargo expenses so that you can understand nonfuel unit costs, excluding cargo, across the combined entity. [indiscernible] question, what else I'm missing. Scott Group: Just help on margin and guidance? Robert Neal: Yes, we had talked about -- we've talked for the last couple of quarters about moving away from providing unit metrics, but maybe I'll just use this since we didn't in the prepared remarks to tell you a little bit about kind of how we're thinking about the unit cost side of things, at least for the third quarter. We recognize that if you're looking through the guide, you're probably getting a really high all-in CASM ex year-over-year, if you're looking at that number compared to Allegiant stand-alone in 2025. So maybe I'll just break it out for you to tell you what we're thinking about in the third quarter, which would be, I would expect legacy Allegiant nonfuel unit cost to be up in the 9% to 10% area. And then I would expect consolidated nonfuel unit costs, excluding cargo, to be up a little bit more than that, let's call it, 10% to 12%. Now I want to be clear, it's not a guide. It's an estimate. We're working with this information relatively fresh, but hopefully, that helps a little bit with modeling. Scott Group: That does. And just as long as you're doing -- like when you talked about RASM being similar in Q3 as Q2, was that a Allegiant comment or all-in comment? Robert Neal: It was a consolidated comment. So I'll peel it back one layer deeper that you're not going to see a ton of variance in the individual components. Operator: Your next question comes from the line of Mike Linenberg. Michael Linenberg: Just 3 months into the merger, where are the quick wins or low-hanging fruit? What are the pain points? I know, Drew, you mentioned moving into the OTA world for the first time, obviously, uncharted territory for Allegiant. Maybe you could just kind of run through some of the -- sort of what you're seeing and maybe how things play out in this first year since you're going to maintain a separate operating certificate? Gregory Anderson: Mike, it's Greg. Thanks for the question. I'll start it off, and Drew may want to jump in on the distribution or other elements of it. But overall, I think the integration and bringing the two companies together is off to a strong start. It's first and foremost stability above all. Both airlines are performing well operationally, financially. As we're bringing -- as we're going through the plan, we have similar cultures, which is good. We have tech systems that align several of them. So that's also very positive. I mentioned in my opening remarks, some of the early progress that we've made. Some of that's around the cross-selling on the websites or we filed with the FAA on our single operating certificate, although that will take some time to work through on the procurement and supply chain side as well. But what I'm encouraged by with the integration office, the IMO is, just even with all of that, but the big milestones, which are the SOC or the PSS or the JCBA, just the plans we have in place as we think about those, those are a little bit longer term. But I wanted to highlight just we have the right people in the right places with experts helping us plan out so that we can continue to integrate as smoothly as possible. But Drew, any other comments you want to add? Drew Wells: Not a ton from my side. Obviously, the Expedia process, we had started well before we knew we'd be coming together through the acquisition. I think it's going to be very helpful as we think about combining some of the commercial processes and some of the connectivity we'll need to fully optimize what we'd like to do. But just, yes, the team is coming together and having kind of a unique perspective on how to accomplish a lot of the same goals has led to some really fun debates, and I think it's going to lead to some really incredible results as we can get from planning into the execution. So really excited where this is going to go. Operator: Your next question comes from the line of John Godyn with Citigroup. Unknown Analyst: This is Max on for John. I wanted to plug into your fleet strategy at large a bit. Can you speak a bit more on the delivery cadence of the 737s kind of through '27 and the incremental margin you're expecting from these aircraft kind of in the short to medium term? And if you can provide some of the contours around fuel efficiency, capacity contributions and segmentation benefits you expect from these aircraft, including the Allegiant First? Gregory Anderson: Max, this is Greg. Thanks for the question. Let me give some high-level thoughts and turn it over to the team. But overall, you asked about our fleet strategy and I'd say owning our fleet and buying and selling aircraft at the right prices are a key part of our strategy. We want to be, and I think we are very good at both operating aircraft and also very good as asset traders. And I think that shows because we have some of the lowest ownership costs when it comes to fleet, I think, in the industry. And on the MAX order specifically, I just want to call out, we view that as a competitive advantage. It provides us access to aircraft at very attractive prices and kind of tying it all together with the fleet strategy. What BJ, [indiscernible] and team have done is with some of the older, less utilized assets that we've sold, we've been able to pay for, I think, roughly 25% of the MAX orders. So just hats off to the team and how they're handling the fleet. But BJ, do you want to get into the specifics on how they're performing, how the MAX is performing and the benefits? Robert Neal: Sure. Yes. Maybe, Max, I'll hit on your question on schedule first. You asked about sort of what does the delivery cadence look like from here. What you see in the release largely covers our deliveries through this year. There may be one or two aircraft on property that are not in service at the end of 2026. I would expect the MAX fleet to grow by around 20 shells during 2027. That should take you up to, call it, 45 to 47 in-service airplanes at the end of 2027. And then just remember, our firm order was for 50 aircraft. The rest of those would deliver in 2028. They are all MAX 8 variant at this point. And so that's the entirety of the firm order. As I think you're aware, we do have a very attractive option book, which kicks in, in early 2028 and runs out past the end of the decade. So we're taking a close look at that now. Of course, the combination with Sun Country opens up a lot of opportunities to dip into that option book. a little bit more. And then the way I'm kind of thinking about that, at least certainly in the current environment with fuel where it is, the MAX aircraft are outperforming the -- probably the NGs, but certainly the 320s on an ASMs per gallon basis, which is driving incrementally better earnings at a higher fuel price. And then just the last thing I would mention is we're starting to appreciate quite a bit more at this point that we were one of the later operators to have a power by-the-hour agreement on our engines. And so we just have an attractive engine maintenance profile on the new airplanes as well, and that's another reason to consider those airplanes very seriously. Gregory Anderson: One thing we didn't hit on this quarter but did last, just the fuel efficiency aspect and kind of the second order effects. We think it saves about 1% worth of capacity in the current year by having that fuel-efficient MAX aircraft, which won't show up directly in kind of the margin difference between the two, but does show up on the bottom line, and I think it's important to keep in mind. Operator: Your next question comes from the line of Savi Syth. Savanthi Syth: I know there's a lot of kind of planning here and kind of stay tuned for Investor Day, but I was kind of hoping you could drill down a little bit more on the two things you're actually kind of doing today, which is kind of Expedia, just the reason for that change and what might be different, kind of doing an OTA today versus maybe in the past that kind of kept you away and then the onboard kind of beverages, just how much of the impact should we think of that in terms of cost or kind of efficiency and things like that? Drew Wells: Sure. I'd be happy to take that. Expedia was really about finding an efficient source for the breadth of network that we have. We will continue to have direct bookings as our core source of revenue generation. But when you think about network with 120-plus cities, 550-plus routes at any given time, achieving efficient marketing across the entirety of that breadth is not always easy. And so this was a method that we found to be scalable and effective at reaching folks that were in or showing interest for travel, a product that we're proud of and proud to put out there. So I don't view it so much as a huge pivot away from the core pillars, [indiscernible] remain that. But this is an attractive kind of customer acquisition plot from my side. On the in-flight beverages, this is the first of kind of those healthy debates I was referring to in the previous answer. Both the Sun Country brand and the Allegiant brand are very interested in kind of customer experience and exploring kind of this void that exists in kind of the smart value area of the industry. And for me, as we started talking, it became a no-brainer that we go down this path and explore and match the Sun Country offering on complementary in-flight beverages. I don't have the number off the top of my head for explicit headwinds. I don't think it's a material headwind, especially as we're talking about still expanding the air ancillary unit revenue into the next quarter. Robert Neal: Yes. On the cost side, it's not material, at least for the remainder of this year. Gregory Anderson: And Savi, I just want to add just a little finer point on the Expedia commentary that Drew provided. And that's just -- we know the direct bookings, that's part of our DNA. That will always be part of our DNA and it's important as we -- as Drew and the team, they work through the Expedia structure, that we continue to own the relationship with our customer. And so that was an important part of the deal for us. As Drew mentioned, the early results, they're very encouraging. The vast majority of folks using this channel are new customers or win back. So we're pleased with what we see thus far. Operator: Your next question comes from the line of Duane Pfennigwerth with Evercore. Duane Pfennigwerth: It will be tough for me to limit it to one, but I'm going to follow directions here. Can you speak to when you think you'll be able to get code sharing switched on? And I guess, any early learnings as you look at the combined network? How do the peaks at Sun Country differ from the peaks at Allegiant seasonally, for example? Drew Wells: Yes, Duane, I'll take that one. So we're able to kind of cross-sell today, which is effectively showcasing the inventory that the other carrier has and then ship them into the appropriate booking funnel to continue the purchase path. I think a little bit later this year, we'll expand what we're able to do from a merchandising perspective, but a full code share or selling will probably come in the PSS time frame, I'd assume, and you're 12 to 18 months out, looking at Michael Broderick maybe for confirmation, maybe 12 to 18 months out on that. Gregory Anderson: And then talking seasonality and peaks, we're both very much after the leisure customers. So there's going to be a lot of similarities from that perspective. I think you're going to get a slightly, I guess, more hyper peak in the spring period, which is common for the geography coming out of Minneapolis, St. Paul and probably a slightly stronger summer peak coming from the Allegiant side and maybe one other strong peak in October on some country. Yes. So nothing drastically different, just kind of some of the seasonality peaked up slightly more for one carrier or another. Operator: Your next question comes from the line of Dan McKenzie with Seaport Global. Daniel McKenzie: Congrats on the quarter here. Drew, I was wondering if you can elaborate more on the decision for a first-class product? And I guess I'm just -- is it simply a competitive response since others in the low-cost segment have introduced it? So Allegiant has does it -- do it as well? Or was it something you've been planning for a while? And I guess, historically, I think the average fare in the first class has typically been 4 to 6x the leisure fare. And I'm just curious if -- on the work that you did there to arrive at that decision and what this could really mean to the business as you look ahead, say, 2 to 3 years out, say, as a percent of total revenue? Drew Wells: Yes, I'll probably save kind of any of the economic discussion for the Analyst Day later this year. But speaking to the process a little bit, this has been a couple of years in the making, and it really did generate from the results we saw through the Allegiant Extra process. We started that in 2018, 2019 as a test across four aircraft and never could have dreamed it would have expanded to the success that we've seen over the last 2, 3 years. So when we couple that with kind of looking at our customer strength and in particular, household incomes meaningfully over $100,000 and a nice tail end of that distribution into the higher income brackets and some of the repeat travelers we have inside Allegiant Extra, it really opened the door, at least to me to say, hey, there's more that we can provide that gives value to the customer. So we'll have more of the economics there, but it really came down to the success we saw on Allegiant Extra and the customer strength profile. Operator: Your next question comes from the line of Ravi Shanker with Morgan Stanley. Ravi Shanker: Plenty to unpack on the call, but if I can just follow up on the pilot situation with your competitor kind of taking some of your junior pilots. Can you just expand on that a little bit? How convinced are you that this is a onetime event? And even though you said that you're pretty confident in the pipeline being restored later this year, kind of is this potentially likely to be an ongoing thing? Gregory Anderson: Ravi, it's Greg. Let me take that one. Yes, we view it as temporary. But just maybe taking a step back, just in general, like pilot attrition, we have a number of pilots across both airlines that -- ultimately, it's a small number, I hope, but ultimately that want to work for a full-service carrier. As we drill down a little bit deeper with our Sun Country pilots and what we've seen there, the vast majority of them have been hired within the last 3 years. And then they're going to the largest full-service carrier in MSP who recently increased their hiring by maybe double or more. But importantly, and you called out, our school house is full. It's full on the Sun Country side, we have multiple classes. On the Allegiant side, we just opened a class. The number of applications for candidates, cadets and pilots is off the charts, very highly qualified. And they value what we offer. We offer competitive pay, but we also offer unique quality of life overall where our team members, our flight crews are home every night. And so we're confident we'll manage through it. It's a headwind in the near term. We're going to manage through it, and we look forward to restoring and getting back to where we want to be and particularly for flying in March of '27. Ravi Shanker: Apologies for the follow-up, but do you think that this is a precursor to like more capacity coming in from them in MSP or kind of why are they doing this? Gregory Anderson: I don't want to comment on other carriers and why they're hiring, but I don't believe it's from a capacity standpoint trying to come in MSP. Operator: Your next question comes from the line of James Kirby with JPMorgan. James Kirby: Just wanted to ask about the implied step change from Q3 to Q4. I know you talked about the CASM ex being peak in Q3. So I assume a step down in Q4, but maybe just any RASM assumptions or macro that is embedded in the implied 4Q guide? Or any color you can share really how it's booking? I assume you have like a month or 2 of data there, but any color you can share on how RASM is trending there? Drew Wells: Sure. Drew here. Real early for 4Q, still more than 80%, 85% left to go there. So everything is kind of small sample size theater for now. I mean, things look great. I mean we're not baking in any kind of reduction or slowdown in the demand environment. Our growth rate ticks up a little bit from combined down 5 -- or down 5.5% to the Allegiant stand-alone getting slightly positive there. We haven't talked to a combined piece. And then just bear in mind that the Q4 comp from last year got meaningfully tougher on our end as well. So I think the environment persists. I'm extremely bullish and have been -- I think I've communicated all year that the holiday period is going to show up and show up really well. So I think 4Q is going to be really strong again. James Kirby: Got it. And then just a really quick follow-up on the Sun Country pilot attrition. Are you expecting that to kind of be the worse in 3Q and then improve 4Q? I know you said 2027 is when you expect this fully to abate and probably return to growth there in MSP, but just for the cadence of the year? Gregory Anderson: Yes, the recent trends over the past couple of weeks have been encouraging, but we're planning for the worst, and we're going to continue to hire and try and get ahead of it as quickly as we can. But -- so I don't want to make a call here or there. They're still -- it's out of our control to a degree. But like I said, we're going to react and manage through it with the tools we have the best we can. Operator: Your next question comes from the line of Chris Stathoulopoulos with SIG. Christopher Stathoulopoulos: On this CBA with the pilots, I appreciate the color with the 401(k) contribution, the cash piece. There're some comments around the crew productivity side. And if you could frame how we should think -- I'm guessing you're thinking about that in utilization or block hours per aircraft, but the timing around that and the cadence or perhaps the fourth quarter exit rate and how you're thinking about that utilization for next year? Gregory Anderson: Chris, it's Greg. Why don't I kick it off. And if BJ wants to add some commentary, he'll jump in here. But first and foremost, we're very happy to have a deal ratified by our pilots. It's been a long time coming. And as you mentioned, it improves pay benefits, quality of life. There's a unique pay feature with a retention bonus in there as well that we've been accruing since May of 2023 and just genuinely happy to be able to pay that out, very well earned and deserved. Importantly, I think on both sides, it's -- we're able to roll out a new preferential bidding system that is off the shelf. It's called NAVBLUE. Many other carriers use it. And within that bidding system, we think that we'll have that in place by the end of the year is what we're working towards. And I think this will just help with transparency. It will help us in the sense of building more productive lines around scheduling. And so I think that's what BJ's -- or that's what we've been talking about that we'll see. That won't happen until next year, we would expect. But BJ, any other commentary you want to hit? Robert Neal: Yes, Chris, I mean, I think you mentioned the 401(k) contribution and some of the other benefit elements, and then there's just a small step-up in wage rates through the end of this year versus the rates that we were accruing. That's probably driving one to two points in CASM ex in the back half of the year. But keep in mind, pilot headcount is relatively flat on more than 1,300 pilots. I think we're down around 50 heads year-over-year, something like that. And so we just -- you just -- we're going to see a little bit of cost pressure because we didn't have the aircraft to fully utilize the crew members that we have through the end of this year, and that's where the productivity comes back in as we head into March. Operator: Your next question comes from the line of Conor Cunningham with Melius Research. Robert Neal: Hey, Conor are you there? Operator? Operator: And going to the next question from Catherine O'Brien with Goldman Sachs. Catherine O'Brien: One question, admittedly a little bit of a multiparter on RASM. But I guess, first, what drove the better Allegiant stand-alone RASM versus your June 30 guide? And could you maybe give us some color just on where you exited 2Q on a consolidated RASM basis? It's not an exact number for June, just maybe how to think about it versus that total 2Q performance? And how much of 3Q do you have booked and any parts of the network you'd call it bright spots? Gregory Anderson: I will do my best to handle all the parts. Maybe just kind of generally on the 2Q cadence, end of April was probably the relative low point. And then we hit kind of almost flattish from early May through the end of June. So maybe not quite as stark of a cadence through the quarter as some others have commented on, but everything looks pretty good for virtually the entirety of the quarter. So I feel really good about that. And I think that's true generally of the combined entity, but I'm speaking specifically to Allegiant on that front. Probably won't talk too much about hotspots either. Again, with the unit revenue performance, there's just hard to point to a lot of things that didn't live up to the excitement. So I feel really good broadly there. Cathie, what else did you want to hit on? Catherine O'Brien: Just how much of 3Q is booked? Gregory Anderson: Yes. I would hate admitting this number in this call. We're about 80% booked for the quarter. So we have pretty good line of sight to 3Q at this point. Operator: I will now turn the call back over to Sherry Wilson for closing remarks. Sherry Wilson: Thank you, all, for joining today's call. Please reach out if you have questions. Otherwise, we will talk to you next quarter. Operator: Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect. 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This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool recommends Allegiant Travel. The Motley Fool has a disclosure policy. Allegiant Travel (ALGT) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Allegiant Travel Company ALGT reported second-quarter 2026 adjusted earnings of $2.19 per share, up 78% year over year and 72.4% above the Zacks Consensus Estimate of $1.27. Strong standalone Allegiant results and roughly seven weeks of Sun Country contributions supported the earnings beat. Quarterly revenues rose 36.9% to $943.5 million but missed the consensus mark of $1.03 billion by 8.4%. Standalone Allegiant set a quarterly record for total revenue per available seat mile or TRASM, which climbed 24.6% year over year to 14.42 cents. Allegiant Travel Company price-consensus-eps-surprise-chart | Allegiant Travel Company Quote Passenger revenues increased 33.1% year over year to $822.5 million and represented the largest part of the top line. Third-party products revenues rose 36% to $45.8 million, while fixed-fee contract revenues surged 168.7% to $45.7 million. Cargo revenues were $27.6 million, reflecting Sun Country's contribution following the May 13 acquisition closing. Sun Country generated $167.3 million of consolidated revenues during the post-closing period, while standalone Allegiant revenues advanced 16.1% to a record $776.2 million. Standalone Allegiant delivered its record revenues despite a 6.8% reduction in capacity. Management attributed the performance to strong leisure demand, peak-period scheduling and progress across commercial initiatives. Cobrand credit card remuneration increased 23.6% to $41.2 million. The company also began distributing flights through Expedia, giving Allegiant access to new customers while retaining its direct sales channels. Management said the partnership accounted for roughly 3% of bookings shortly after its July launch. Total operating expenses increased 21.9% to $922.4 million. Aircraft fuel expenses climbed 85.6% to $307.7 million, with the consolidated average fuel cost per gallon rising 71.1% to $4.14. Adjusted operating income totaled $87.1 million, producing an adjusted operating margin of 9.2%. Standalone Allegiant's adjusted margin improved 40 basis points to 9%, even as its fuel price per gallon increased 73%. Adjusted operating cost per available seat mile, excluding fuel, special charges and cargo expenses, was 8.19 cents. Allegiant ended June with $1.3 billion of available liquidity, including $1.1 billion of cash and investments and $250 million of undrawn revolving credit facilities. Consolidated cash from operations totaled $46 million during the second quarter. Total debt was $2.8 billion, including $546.8 million attributable to Sun Country, while net debt stood at $1.7 billion. The company issued $650 million of 7.125% senior secured notes due 2031 and used part of the proceeds to repurchase $377.5 million of notes due in 2027. For the third quarter of 2026, management expects system capacity to decline roughly 6.5% year over year, with scheduled-service capacity down about 5.5%. The adjusted operating margin is projected to be between 1% and 3%, while adjusted results are expected to range from a loss of $1 per share to breakeven. Fuel cost per gallon is projected to be $3.80 for the third quarter. Management expects combined-company unit revenue growth to be roughly consistent with standalone Allegiant's second-quarter increase, supported by healthy leisure demand and reduced off-peak flying. For 2026, Allegiant expects adjusted earnings of more than $6 per share and fuel costs of $3.70 per gallon. The company remains confident in achieving at least $140 million of annual run-rate synergies within three years of the Sun Country acquisition closing. Currently, Allegiant carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Westinghouse Air Brake Technologies WAB, operating as Wabtec Corporation, reported encouraging second-quarter 2026 results, wherein both earnings and revenues surpassed the Zacks Consensus Estimate and increased year over year. Quarterly adjusted earnings of $2.76 per share beat the Zacks Consensus Estimate of $2.63 by 4.9% and increased 21.6% year over year, owing to higher sales and operating margin expansion. Revenues climbed 17.5% to $3.18 billion and surpassed the consensus mark of $3.08 billion by 3.2%. United Airlines Holdings, Inc. UAL reported second-quarter 2026 adjusted earnings of $1.99 per share, down 48.6% year over year but above the Zacks Consensus Estimate of $1.92 by 3.7%. Operating revenues rose 16% to $17.67 billion and were essentially in line with the $17.68 billion consensus mark. A 12.1% increase in total revenues per available seat mile or TRASM, and broad-based gains across premium, loyalty and cargo revenues, supported the top line despite sharply higher fuel costs. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Allegiant Travel Company (ALGT) : Free Stock Analysis Report United Airlines Holdings Inc (UAL) : Free Stock Analysis Report Wabtec (WAB) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

This article first appeared on GuruFocus. Total Revenue (Combined): $943.5 million, including Sun Country results from May 13 acquisition date. Standalone Allegiant Revenue: $776 million, up 16.1% year-over-year, a record quarter. Standalone Allegiant TRASM: $14.42, up 24.6% year-over-year, an all-time company record. Standalone Sun Country TRASM: $12.64, up 22% year-over-year. Pre-Tax Income (Combined): $64.5 million, with Sun Country contributing $13.4 million. Consolidated EPS: $2.19. Consolidated Operating Margin: 9.2%, leading the US carrier industry. Consolidated EBITDA: Nearly $158 million, with Sun Country contributing $29.7 million; EBITDA margin of nearly 17%. Standalone Allegiant CASM-X Fuel: $0.17, up 6.4% year-over-year. Capital Expenditures (Combined): $188 million in Q2, including $157 million in aircraft-related investments. Full-Year 2026 CapEx Outlook: Approximately $850 million. Total Available Liquidity: $1.3 billion, including $1.1 billion in cash and investments. Total Debt: $2.8 billion; net debt of $1.7 billion with pro forma net leverage of approximately 2.6 times. Co-Brand Credit Card Remuneration: Up 24% year-over-year. Expedia Bookings: Approximately 3% of bookings since launch, with over half from net new customers. Third-Quarter Revenue Outlook: Expected up approximately 16.5% against combined airline-only Q3 2025 revenue of ~$808 million. Third-Quarter Capacity Outlook: Combined scheduled service ASMs expected down approximately 5.5% year-over-year. Full-Year 2026 EPS Outlook: At least $6 per share. Warning! GuruFocus has detected 3 Warning Sign with ALGT. Is ALGT fairly valued? Test your thesis with our free DCF calculator. Release Date: August 04, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Allegiant Travel Co (NASDAQ:ALGT) delivered record quarterly revenue with both Allegiant and Sun Country achieving year-over-year TRASM improvement of more than 20%, leading the industry in operating margin for the third consecutive quarter. The company's new commercial initiatives, including the Expedia partnership and Allegiant First premium product, are gaining momentum, with Expedia already contributing 3% of bookings and more than half coming from new customers. Allegiant Travel Co (NASDAQ:ALGT) has a strong balance sheet with $1.3 billion in total available liquidity and pro forma net leverage of approximately 2.6 times, providing financial flexibility for integration and growth. The integration of Sun Country is progressing well, with early wins including cross-selling on websites, streamlined procurement, and a simplified platform combination due to shared Navitair systems. The company's co-brand credit card program is excelling, with bank compensation up 24% year-over-year and a record month for new accounts expected in July 2026, supporting the goal of doubling remuneration to 10% of revenue. Allegiant Travel Co (NASDAQ:ALGT) expects full year 2026 EPS of at least $6 per share, with third quarter unit revenue growth expected to be in line with the second quarter's 24.6% increase. The new Allegiant First premium product, launching in 2027, is expected to enhance customer value proposition with only a two-seat reduction from the current 190-seat layout, preserving unit cost advantages. Sun Country has experienced elevated pilot attrition, concentrated among junior MSP pilots, driven by increased hiring at the largest carrier in the Twin Cities, leading to reduced off-peak capacity in the back half of the year. Elevated fuel prices remain a significant headwind, with a $0.10 increase in fuel per gallon worth roughly $0.50 of earnings per share for the combined company, and fuel costs are expected to remain volatile. The company expects third quarter CASM-ex fuel to be the peak year-over-year increase, driven by new pilot CBA costs, including 401 contributions and other benefits, along with timing shifts in maintenance and labor expenses. Allegiant Travel Co (NASDAQ:ALGT) is reducing combined entity scheduled service capacity by approximately 5.5% in the third quarter, with full year capacity expected to be down mid-single-digits, limiting growth potential. The company anticipates a consolidated loss per share of approximately $0.50 in the third quarter, reflecting the seasonally weakest period for both carriers and continued cost pressures. The transition to complementary onboard beverages will pose a mild near-term headwind to air ancillary revenue and commissary costs, though the company expects to grow third quarter air ancillary per passenger. Full year 2026 CapEx outlook has been increased to approximately $850 million, including incremental PDP payments for future aircraft, which may pressure cash flow and liquidity. Q: What are your preliminary thoughts on capacity plans for 2027, and what capacity growth is needed to fully leverage cost inflation following the new pilot deal?A: CEO Greg Anderson emphasized that Allegiant needs to "earn the right to grow" and that returns in the environment should drive growth, not growth for growth's sake. He noted the success of flying more in peak periods despite lower overall capacity. CFO Robert Neal added that 2027 is the peak year for aircraft deliveries from their firm order, providing an option for growth, but they retain flexibility to retire older aircraft if the environment doesn't support expansion. Q: Can you elaborate on the decision to introduce the new Allegiant First premium product? Was it a competitive response or a long-planned initiative, and what could it mean for revenue in the coming years?A: CCO Drew Wells explained that Allegiant First has been in development for a couple of years, stemming from the unexpected success of Allegiant Extra. The decision was driven by customer data showing strong household incomes and an appetite for premium services. He deferred detailed economics to the upcoming Analyst Day but indicated the product is a logical next step based on customer demand. Q: How should we think about the breakdown of the Q3 guidance between the Allegiant and Sun Country segments, particularly regarding unit costs and margins?A: CFO Robert Neal stated they will continue reporting two business segments (Legacy Allegiant and Sun Country) at least through year-end. He provided estimates for Q3, expecting legacy Allegiant non-fuel unit costs to be up 9%-10%, and consolidated non-fuel unit costs excluding cargo to be up 10%-12%. He clarified this was an estimate, not a formal guide, to help with modeling. Q: Where are the quick wins or low-hanging fruit in the Sun Country integration, and what are the main pain points?A: CEO Greg Anderson highlighted strong early progress, including cross-selling on websites, filing for a single operating certificate, and procurement synergies. He emphasized stability as the top priority, with both airlines performing well operationally and financially. CCO Drew Wells noted the Expedia partnership, started pre-acquisition, will help combine commercial processes, and the teams are having productive debates that should lead to strong results. Q: Can you provide more detail on the 737 MAX delivery cadence through 2027 and the incremental margin expectations from these aircraft?A: CFO Robert Neal outlined that the MAX fleet should grow by around 20 aircraft during 2027, reaching 45-47 in-service planes by year-end, with the remaining firm order delivering in 2028. He noted the MAX aircraft are outperforming older NGs and A320s on fuel efficiency, driving better earnings at higher fuel prices. CCO Drew Wells added that the fuel-efficient MAX fleet saves about 1% of capacity in the current year, positively impacting the bottom line. Q: What drove the decision to launch the Expedia partnership, and how significant is the impact of the new complimentary onboard beverages?A: CCO Drew Wells explained Expedia provides an efficient, scalable way to reach new customers across their broad network, complementing rather than replacing direct bookings. Early results show about 3% of bookings from Expedia, with over half from new customers. On beverages, he noted it's the first of several policy alignments between the brands, and while it poses a mild near-term headwind to ancillary revenue, it's not material, and they still expect to grow air ancillary per passenger in Q3. Q: When will code-sharing between Allegiant and Sun Country be enabled, and how do the seasonal peaks differ between the two networks?A: CCO Drew Wells stated that cross-selling is already live, but a full code-share will likely come with the single passenger service system, estimated at 12-18 months out. On seasonality, both carriers target leisure customers, but Sun Country has a stronger spring peak from Minneapolis-St. Paul, while Allegiant has a stronger summer peak, with Sun Country also seeing a notable October peak. Q: How confident are you that the elevated Sun Country pilot attrition is a one-time event, and what is the pipeline to restore capacity?A: CEO Greg Anderson views the attrition as temporary, driven by a competitor in MSP doubling hiring. He noted the vast majority of departing pilots were hired within the last three years. Importantly, training classes are full with highly qualified candidates, and the company values its unique quality-of-life proposition (crews home every night). He expects to restore flying capacity by March 2027, though recent trends are encouraging. Q: What is driving the implied step-change in performance from Q3 to Q4, and what are your RASM assumptions for Q4?A: CCO Drew Wells noted it's very early for Q4 (over 80% unbooked), but the demand environment remains strong with no slowdown expected. He highlighted that Allegiant standalone capacity turns slightly positive in Q4, and the year-over-year comp gets tougher. He remains "extremely bullish" on the holiday period, expecting Q4 to be strong. Q: What drove the better-than-expected Allegiant standalone RASM versus the June 30 guidance, and how much of Q3 is booked?A: CCO Drew Wells indicated that late April was the relative low point, with demand remaining strong through the end of June. He noted it's hard to point to specific bright spots given the broad-based strength. He also revealed that Q3 is approximately 80% booked, providing good line of sight into the quarter's performance. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Allegiant Travel (ALGT) reported $943.49 million in revenue for the quarter ended June 2026, representing a year-over-year increase of 36.9%. EPS of $2.19 for the same period compares to $1.23 a year ago. The reported revenue compares to the Zacks Consensus Estimate of $1.03 billion, representing a surprise of -8.38%. The company delivered an EPS surprise of +72.44%, with the consensus EPS estimate being $1.27. While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expectations to determine their next course of action, some key metrics always provide a better insight into a company's underlying performance. Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance. Here is how Allegiant Travel performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts: Scheduled service statistics - Revenue passenger miles (RPMs): 5.23 billion versus 5 billion estimated by five analysts on average. Scheduled service statistics - Load factor: 85.7% compared to the 85.2% average estimate based on five analysts. Scheduled service statistics - Available seat miles (ASMs): 6.1 billion compared to the 5.69 billion average estimate based on five analysts. Total system statistics - Available seat miles (ASMs): 6.41 billion versus 6.07 billion estimated by five analysts on average. Total system statistics - Airline operating CASM, excluding fuel: 8.19 cents versus the four-analyst average estimate of 9.79 cents. Scheduled service statistics - Total passenger revenue per ASM (TRASM): 14.24 cents compared to the 15.57 cents average estimate based on four analysts. Total system statistics - Average fuel cost per gallon: $4.1 per gallon versus $4.2 per gallon estimated by four analysts on average. Total system statistics - Passengers: 5,753,539 versus the three-analyst average estimate of 5,334,570. Total system statistics - Full-time equivalent employees at end of period: 8,484 versus the three-analyst average estimate of 5,996. Operating Revenues- Fixed fee contracts: $45.72 million versus $37.94 million estimated by four analysts on average. Compared to the year-ago quarter, this number represents a +168.7% change. Operating Revenues- Passenger: $822.49 million versus the four-analyst average estimate of $868.15 million. The reported number represents a year-over-year change of +33.1%. Operating Revenues- Third party products: $45.76 million compared to the $50.44 million average estimate based on four analysts. The reported number represents a change of +36% year over year. View all Key Company Metrics for Allegiant Travel here>>> Shares of Allegiant Travel have returned -10.5% over the past month versus the Zacks S&P 500 composite's +1.7% change. The stock currently has a Zacks Rank #2 (Buy), indicating that it could outperform the broader market in the near term. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Allegiant Travel Company (ALGT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Allegiant Travel (ALGT) came out with quarterly earnings of $2.19 per share, beating the Zacks Consensus Estimate of $1.27 per share. This compares to earnings of $1.23 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +72.44%. A quarter ago, it was expected that this travel services company would post earnings of $3.4 per share when it actually produced earnings of $3.77, delivering a surprise of +10.88%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Allegiant Travel, which belongs to the Zacks Transportation - Airline industry, posted revenues of $943.49 million for the quarter ended June 2026, missing the Zacks Consensus Estimate by 8.38%. This compares to year-ago revenues of $689.38 million. The company has topped consensus revenue estimates two times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Allegiant Travel shares have added about 21.4% since the beginning of the year versus the S&P 500's gain of 11%. While Allegiant Travel has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Allegiant Travel was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.08 on $950.15 million in revenues for the coming quarter and $7.50 on $3.73 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Transportation - Airline is currently in the bottom 40% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Surf Air Mobility Inc. (SRFM), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 10. This company is expected to post quarterly loss of $0.18 per share in its upcoming report, which represents a year-over-year change of +80.7%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Surf Air Mobility Inc.'s revenues are expected to be $28.45 million, up 3.7% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Allegiant Travel Company (ALGT) : Free Stock Analysis Report Surf Air Mobility Inc. (SRFM) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Interested in Allegiant Travel Company? Here are five stocks we like better. Record Q2 performance: Allegiant generated $776 million in standalone revenue, up 16.1% year over year, while combined revenue with Sun Country reached $943.5 million. The combined company posted a 9.2% operating margin, nearly $158 million of EBITDA and adjusted EPS of $2.19. Sun Country integration is progressing toward at least $140 million in annualized synergies by 2029, though pilot attrition is forcing reduced off-peak Minneapolis-St. Paul capacity in the second half of 2026. The company is targeting FAA approval for a single operating certificate in the first half of 2028. Near-term costs and seasonality remain challenges: Allegiant expects third-quarter capacity to decline 5.5%, an operating margin of roughly 2% and a loss per share of about $0.50. Management still forecasts full-year adjusted EPS above $6 and plans to launch premium Allegiant First seating in 2027. Travel Demand Soars Despite Fuel Costs—Are Airline Stocks a Buy? Allegiant Travel (NASDAQ:ALGT) reported record second-quarter revenue as the company began integrating Sun Country Airlines following the May 13 acquisition close. Management said both airlines posted year-over-year unit-revenue improvement of more than 20%, while the combined company delivered what it described as the highest operating margin among U.S. carriers during the quarter. The company’s reported second-quarter figures include Allegiant’s full quarter and Sun Country’s results from the acquisition date through June 30. Prior-year comparisons generally reflect Allegiant on a standalone basis. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control Is Jet Blue's Descent Into Penny Stock Territory an Opportunity? Chief Executive Officer Greg Anderson said the combined business produced strong operating results while completing the acquisition and launching integration work. He pointed to Allegiant’s repeat-customer base, flexible low-utilization scheduling model, aircraft ownership strategy, community presence and balance sheet as key competitive advantages. “We are better positioned today than at any point in our history,” Anderson said, adding that the company remains focused on building a leading U.S. leisure carrier. → Financials Hit Record Highs as the AI Trade Unravels—Can They Keep Leading? On a standalone basis, Allegiant generated $776 million of total revenue in the second quarter, up 16.1% from the prior year, according to Chief Commercial Officer Drew Wells. The airline reduced system capacity by 6.8% but kept passenger counts nearly flat, producing a record quarterly revenue total. Standalone Allegiant total revenue per available seat mile, or TRASM, reached $0.1442, up 24.6% year over year. Wells said the increase reflected gains across multiple revenue levers, including a more than 40% rise in yield, an approximately four-point improvement in load factor and more than 30% growth in third-party revenue per passenger. → Why Rare Earth Processing Could Be the Real 2027 Opportunity Allegiant’s scheduled-service air revenue increased by $102 million from a year earlier, exceeding the company’s $99 million increase in fuel expense, Wells said. For the combined entity, second-quarter revenue totaled $943.5 million. Chief Financial Officer Robert Neal said the company generated adjusted pre-tax income of $64.5 million and adjusted earnings per share of $2.19. Sun Country contributed $13.4 million of pre-tax income during the post-acquisition period. The combined company reported a 9.2% operating margin and nearly $158 million of EBITDA, representing an EBITDA margin of nearly 17%. Sun Country contributed $29.7 million of EBITDA during the stub period. Management said integration work is progressing, with customers now able to search for flights on both airlines’ websites and be redirected to the operating carrier to complete a booking. The companies are also reviewing supplier relationships, schedule planning and network opportunities. Allegiant has submitted its single operating certificate transition plan to the Federal Aviation Administration and is targeting approval in the first half of 2028. The company expects at least $140 million in annualized run-rate synergies from the transaction by 2029. However, Anderson said Sun Country has faced elevated pilot attrition among junior Minneapolis-St. Paul-based pilots, largely because of increased hiring by the largest carrier in the Twin Cities. Allegiant is reducing off-peak Minneapolis-St. Paul capacity during the second half of 2026 in response to attrition and higher fuel prices. The company said its pilot training classes are full and expects pilots entering service later this year to support renewed Minneapolis-St. Paul capacity growth in 2027. Management also said Allegiant and its pilots ratified a new collective bargaining agreement, with nearly 80% of voting pilots approving the contract. Allegiant highlighted several commercial initiatives intended to support revenue growth. The company’s Allways Rewards co-brand credit-card remuneration rose 24% year over year in the second quarter. Management reiterated its long-term goal of doubling co-brand remuneration from about 5% of revenue currently to 10%. The carrier also launched an Expedia partnership, marking Allegiant’s entry into online travel agency distribution. Wells said Allegiant was fully live on Expedia as of July 10, and about 3% of bookings in the first few weeks came through Expedia’s network. More than half of those bookings came from customers new to Allegiant, according to management. Allegiant said it intends to retain control of its brand, product offering and customer relationship while using Expedia as a customer-acquisition channel. The company initially launched a simplified airfare-only offering and expects to add products and capabilities over time. In addition, Allegiant plans to introduce a premium seating product, Allegiant First, on select aircraft beginning in 2027. The new configuration will include eight premium seats and reduce seating by two seats from the current 190-seat MAX layout. Wells said the initiative followed the stronger-than-expected performance of Allegiant Extra and demand for premium offerings. For the third quarter, Allegiant expects combined scheduled-service capacity to decline about 5.5% from a pro forma prior-year base. Wells projected total third-quarter revenue would rise approximately 16.5% from combined airline-only third-quarter 2025 revenue of about $808 million. Management expects combined unit-revenue growth in the third quarter to be broadly in line with Allegiant’s 24.6% second-quarter increase. Neal said consolidated non-fuel unit costs excluding cargo could rise approximately 10% to 12% year over year, while standalone Allegiant non-fuel unit costs could increase about 9% to 10%. Based on an assumed fuel price of $3.80 per gallon, the company expects a third-quarter operating margin of roughly 2% at the midpoint and a consolidated loss per share of approximately $0.50. Management characterized the September quarter as the seasonally weakest period for both airlines. For the full year, Allegiant expects adjusted consolidated earnings per share of more than $6, assuming fuel costs of $3.80 per gallon in the third quarter and $3.70 in the fourth quarter. The combined fleet ended the quarter with 193 aircraft, including 105 Airbus A320-family aircraft, 66 Boeing 737 passenger aircraft and 22 Boeing 737 cargo aircraft. Allegiant expects six additional 737 MAX deliveries through year-end, with six MAX aircraft entering service in the second half and seven aircraft retiring, resulting in an expected year-end operating fleet of 192 aircraft. Allegiant plans to hold an analyst day in Las Vegas on Dec. 7, where it expects to provide additional details on integration progress, Allegiant First and its longer-term financial framework. Allegiant Travel Company is a holding company that operates Allegiant Air, a low‐cost leisure airline offering scheduled and charter air service. The company focuses on connecting underserved secondary markets with popular vacation destinations across the United States. By targeting price‐sensitive leisure travelers, Allegiant Air operates a point‐to‐point network that avoids the traditional hub‐and‐spoke model, providing non‐stop flights from smaller cities to resort and entertainment hubs. In addition to its core flight operations, Allegiant Travel Company offers packaged travel services that include hotel accommodations, rental cars and attraction tickets through its online portal. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Allegiant Travel Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

Second quarter 2026 GAAP loss per share of $(0.21)(1) Second quarter 2026 adjusted diluted earnings per share of $2.19(2)(3)(4), up 78.0 percent year-over-year * Second quarter results include the financial performance of Sun Country only from and after the date the acquisition closed on May 13, 2026 LAS VEGAS., Aug. 4, 2026 /PRNewswire/ -- Allegiant Travel Company (NASDAQ: ALGT) today reported the below financial results for second quarter 2026, as well as comparisons to the prior year. "Our record quarterly revenue and strong second-quarter operating margin, achieved despite materially higher fuel costs, demonstrate the strength and resiliency of Allegiant's business model," stated Greg Anderson, chief executive officer of Allegiant Travel Company. "Despite a 6.8 percent capacity reduction, standalone Allegiant increased unit revenue 24.6 percent year over year and expanded adjusted operating margin 0.4 percentage points to 9.0 percent, keeping us on track to rank among the industry leaders in full-year operating margin. "For the combined company, adjusted earnings per share of $2.19 were well above our guidance range. The upside was supported by strong operating results and approximately seven weeks of Sun Country earnings following our mid-May close. We are pleased with the pace of integration and are confident that we will achieve a minimum of $140 million in annual run-rate synergies within three years of close. "Commercially, we are expanding customer choice through Allegiant First, which will debut on select aircraft next year; our new distribution agreement with Expedia, which is bringing in new customers to Allegiant; and our award-winning cobrand credit card, for which bank remuneration increased 23.6 percent year over year. "Looking to the second half of 2026, leisure demand remains strong, and we expect the combined company's third-quarter unit revenue growth to be approximately in line with the 24.6 percent increase achieved by standalone Allegiant in the second quarter. Given fuel volatility, we will continue to trim off-peak flying while preserving the peak-period schedule. For the full year we are introducing combined-company adjusted earnings per share guidance of more than $6.00, reflecting the addition of Sun Country and current fuel prices. "In closing, none of this happens without our team members, and I want to express my gratitude to Team Allegiant and Team Sun Country. We have never been better positioned, and I'm excited to build on this momentum in the quarters ahead as the leading leisure airline in the United States." Second Quarter 2026 Results and Highlights Second quarter consolidated results include Sun Country operations from and after the May 13, 2026 closing date of the transaction Consolidated total operating revenue(3) of $943.5M Adjusted operating income(1)(2)(3) of $87.1M, yielding an adjusted operating margin of 9.2 percent Adjusted income before income tax(1)(2)(3)(4) of $64.5M, yielding an adjusted pre-tax margin of 6.8 percent Adjusted EBITDA(1)(2)(3)(4) of $157.7M, yielding an adjusted EBITDA margin of 16.7 percent Adjusted operating CASM, excluding fuel, special charges, and cargo expenses(2)(3) of 8.19 ¢ Available seat miles per gallon of fuel of 86.2 $41.2M in total Allegiant Air cobrand credit card remuneration received, up 23.6 percent year over year In July, entered a 12-month exclusive distribution agreement with Expedia Group, Allegiant's first-ever authorized online travel agency ("OTA") partner, bringing the Company's nonstop network to all of Expedia Group's U.S. brands and expanding reach to new leisure customers In July, announced enhancements to the onboard experience, including complimentary inflight beverage service on all Allegiant flights beginning August 1, 2026, and Allegiant First, a new premium seating tier debuting on select aircraft in spring 2027, with seats anticipated to go on sale mid-August On July 31, a new collective bargaining agreement with the International Brotherhood of Teamsters representing the Allegiant pilots was ratified with nearly 80 percent of votes in favor Balance Sheet, Cash and Liquidity Consolidated total available liquidity at June 30, 2026 was $1.3B, which included $1.1B in cash and investments and $250.0M in undrawn revolving credit facilities $46.0M in consolidated cash from operations during second quarter 2026 Consolidated total debt at June 30, 2026 was $2.8B Consolidated debt principal payments of $445.0M during the quarter, which included $422.3M for Allegiant and $22.7M for Sun Country Consolidated air traffic liability at June 30, 2026 was $570.6M, which included $436.8M for Allegiant and $133.9M for Sun Country Capital Expenditures Second quarter Allegiant Air capital expenditures of $183.2M, which included $155.6M for aircraft-related capital expenditures and $27.6M in other capital expenditures Second quarter Allegiant Air deferred heavy maintenance expenditures were $15.9M Guidance, subject to revision Certain forward-looking financial information in the following tables is not presented in accordance with accounting principles generally accepted in the U.S. ("GAAP"). Non-GAAP financial figures may be useful to stakeholders, but should not be considered a substitute for GAAP figures. In reliance on the 'unreasonable efforts' exception in Item 10(e)(1)(i)(B) of SEC Regulation S-K, a reconciliation to the most comparable GAAP financial measure is not provided for adjusted earnings per share and adjusted operating margin in the table below. The Company is not able to reconcile these Non-GAAP financial figures without unreasonable effort because the special charge adjustments will not be known until the end of the indicated future periods and any range of projected values would be too broad to be meaningful. As a result, this information would not be significant to investors. The below guidance is for the combined Allegiant and Sun Country entity. Aircraft Fleet Plan by End of Period The table above is management's best estimate and is provided based on the Company's current plans and is subject to change. The numbers include aircraft expected to be in service at the end of each period and exclude both aircraft that we expect to take delivery of but not to be placed in service until a subsequent period as well as aircraft in temporary storage. The numbers exclude three aircraft owned by the Company but on operating lease to other carriers. Allegiant Travel Company will host a conference call with analysts at 4:30 p.m. ET Tuesday, August 4, 2026 to discuss its second quarter 2026 financial results. A live broadcast of the conference call will be available via the Company's Investor Relations website homepage at http://ir.allegiantair.com. The webcast will also be archived in the "Events & Presentations" section of the website. Allegiant Travel Company Las Vegas-based Allegiant (NASDAQ: ALGT) is an integrated travel company with an airline at its heart, focused on connecting customers with the people, places and experiences that matter most. Through Allegiant Air and Sun Country Airlines, the Company serves approximately 22 million annual customers across scheduled passenger, charter and cargo operations. Together, the airlines operate more than 650 routes serving nearly 175 cities throughout the United States and select international destinations. Allegiant is committed to providing affordable travel options, operational excellence and long-term value for customers, employees, communities and shareholders. For more information, visit us at Allegiant.com. Media information, including photos, is available at http://gofly.us/iiFa303wrtF. Media Inquiries: [email protected] Investor Inquiries: [email protected] Under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, statements in this press release that are not historical facts are forward-looking statements. These forward-looking statements are only estimates or predictions based on our management's beliefs and assumptions and on information currently available to our management. Forward-looking statements include our statements regarding future airline operations, revenue, expenses and earnings, available seat mile growth, expected capital expenditures, the cost of fuel, the timing of aircraft acquisitions and retirements, the number of contracted aircraft to be placed in service in the future, our ability to consummate announced aircraft transactions, estimated tax rate, as well as other information concerning future results of operations, business strategies, financing plans, industry environment and potential growth opportunities. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words "believe," "expect," "guidance," "anticipate," "intend," "plan," "estimate", "project", "hope" or similar expressions. Forward-looking statements involve risks, uncertainties and assumptions. Actual results may differ materially from those expressed in the forward-looking statements. Important risk factors that could cause our results to differ materially from those expressed in the forward-looking statements generally may be found in our periodic reports filed with the Securities and Exchange Commission at www.sec.gov. These risk factors include, without limitation, regulatory reviews of, and production limits on, Boeing impacting our aircraft delivery schedule, an accident involving, or problems with, our aircraft, public perception of our safety, our reliance on our automated systems, our reliance on Boeing to deliver aircraft under contract to us on a timely basis, risk of breach of security of personal data, volatility of fuel costs, labor issues and costs, the ability to obtain regulatory approvals as needed in connection with our fleet and network, the effect of economic conditions on leisure travel, debt covenants and balances, the impact of government regulations on the airline industry, the ability to finance aircraft to be acquired, the ability to obtain necessary government approvals to offer international service, terrorist attacks, risks inherent to airlines, our competitive environment, our reliance on third parties who provide facilities or services to us, the impact of the possible loss of key personnel, economic and other conditions in markets in which we operate, increases in maintenance costs and availability of outside maintenance contractors to perform needed work on our aircraft on a timely basis and at acceptable rates, cyclical and seasonal fluctuations in our operating results, the perceived acceptability of our environmental, social and governance efforts, the risk that the combined company after the Sun Country acquisition will not realize expected benefits, cost savings, accretion, synergies and/or growth from the Sun Country acquisition or that any of the foregoing may take longer to realize or be more costly to achieve than expected, the diversion of management's attention and time from ongoing business operations and opportunities to integration matters, the risk that the integration of Sun Country's operations will be materially delayed or will be more costly or difficult than expected or that Allegiant is otherwise unable to successfully integrate Sun Country's businesses into its businesses, and reputational risk and potential adverse reactions of Allegiant's or Sun Country's customers, suppliers, employees, labor unions or other business partners, including those resulting from the completion of the Sun Country acquisition and the integration of the companies. Any forward-looking statements are based on information available to us today and we undertake no obligation to update publicly any forward-looking statements, whether as a result of future events, new information or otherwise. Detailed financial information follows: 75,248—75,248Depreciation and amortization58,52112,18870,70964,9613,55868,519Maintenance and repairs39,3499,90349,25236,379—36,379Sales and marketing29,8605,33435,19425,1191,71826,837Aircraft rent7,015—7,01511,023—11,023Other operating expenses29,26311,45340,71629,03112,05841,089Special charges, net of recoveries39,51426,43865,95214,595103,329117,924Total operating expenses746,121176,255922,376625,593131,280756,873OPERATING INCOME/(LOSS)30,086(8,972)21,11443,157(110,646)(67,489)OTHER (INCOME) EXPENSES:Interest income(8,093)(747)(8,840)(10,359)—(10,359)Interest expense35,2004,87240,07228,1217,63535,756Capitalized interest(4,937)—(4,937)(4,562)—(4,562)Other non-operating expenses74(35)39240—240Total other expenses22,2444,09026,33413,4407,63521,075INCOME (LOSS) BEFORE INCOME TAXES$ 7,842$ (13,062)$ (5,220)$ 29,717$ (118,281)$ (88,564) Summary Balance Sheet EPS Calculation The following table sets forth the computation of net income per share, on a basic and diluted basis, for the periods indicated (share count and dollar amounts other than per-share amounts in table are in thousands): Appendix ANon-GAAP PresentationThree and Six Months Ended June 30, 2026 and 2025(Unaudited) We present adjusted consolidated operating expense and adjusted consolidated operating income, which exclude special charges related to (i) the impact of losses and insurance recoveries incurred primarily as the result of hurricanes and other insured events at Sunseeker Resort, (ii) other charges related to the sale of Sunseeker, and (iii) the airline special charges listed in the table below. We also present adjusted consolidated interest expense, adjusted consolidated income before income taxes, adjusted consolidated net income, and adjusted consolidated diluted earnings per share, which exclude the special charges described above and losses on extinguishment of debt. We present adjusted airline-only operating expense, adjusted airline-only operating income, adjusted airline-only income before income taxes, adjusted airline-only net income, and adjusted airline-only diluted earnings per share which exclude special charges and other costs related to (i) aircraft accelerated depreciation on early retirement of certain airframes, (ii) accelerated amortization of software identified to be redeveloped, (iii) costs related to the Sun Country acquisition, (iv) a credit loss on a note receivable, and (v) losses on extinguishment of debt. All of the measures described above are non-GAAP financial measures. We believe the presentation of these measures is relevant and useful for investors because it allows them to better gauge the performance of the airlines and to compare our results to other airlines. Management believes the exclusion of these items enhances comparability of financial information between periods. We also present adjusted airline-only CASM, which excludes aircraft fuel expense, special charges, and cargo expenses. Fuel price volatility impacts the comparability of year over year financial performance as do the airline special charges. Cargo expenses are excluded because they do not relate to available seat miles. We believe the adjustments for fuel expense, airline special charges, and cargo expenses allow investors to better understand our non-fuel costs and related performance. Consolidated and airline-only earnings before interest, taxes, depreciation, and amortization ("Consolidated EBITDA" and "Airline EBITDA"), adjusted Consolidated EBITDA, adjusted Airline EBITDA, and estimated adjusted earnings per share, as presented in this press release, are supplemental measures of our performance that are not required by, or presented in accordance with, accounting principles generally accepted in the United States ("GAAP"). These are not measurements of our financial performance under GAAP and should not be considered in isolation or as an alternative to net income or any other performance measures derived in accordance with GAAP or as an alternative to cash flows from operating activities as a measure of our liquidity. We define "EBITDA" as earnings before interest, taxes, depreciation and amortization. The adjusted EBITDA measures also exclude special charges and losses on the extinguishment of debt. We caution investors that amounts presented in accordance with this definition may not be comparable to similar measures disclosed by other issuers, because not all issuers and analysts calculate EBITDA in the same manner. We use EBITDA and adjusted EBITDA to evaluate our operating performance and liquidity, and these are among the primary measures used by management for planning and forecasting of future periods. We believe these presentations of EBITDA are relevant and useful for investors because they allow investors to view results in a manner similar to the method used by management and make it easier to compare our results with other companies that have different financing and capital structures. EBITDA has important limitations as an analytical tool. These limitations include the following: EBITDA does not reflect our capital expenditures, future requirements for capital expenditures or contractual commitments to purchase capital equipment; EBITDA does not reflect interest expense or the cash requirements necessary to service principal or interest payments on our debt; although depreciation and amortization are non-cash charges, the assets that we currently depreciate and amortize will likely have to be replaced in the future, and EBITDA does not reflect the cash required to fund such replacements; and other companies in our industry may calculate EBITDA differently than we do, limiting its usefulness as a comparative measure. Presented below is a quantitative reconciliation of these adjusted numbers (other than the estimated adjusted earnings per share and adjusted operating margin figures) to the most directly comparable GAAP financial performance measure. The SEC has adopted rules (Regulation G) regulating the use of non-GAAP financial measures. Because of our use of non-GAAP financial measures in this press release to supplement our consolidated financial statements presented on a GAAP basis, Regulation G requires us to include in this press release a presentation of the most directly comparable GAAP measures, which are operating expenses, operating income (loss), interest expense, income (loss) before income taxes, net income, and earnings per share, and a reconciliation of the non-GAAP measures to the most comparable GAAP measure. Our utilization of non-GAAP measurements is not meant to be considered in isolation or as a substitute for operating expenses, operating income (loss), interest expense, income (loss) before income taxes, net income (loss), earnings (loss) per share, or other measures of financial performance prepared in accordance with GAAP. Our use of these non-GAAP measures may not be comparable to similarly titled measures employed by other companies in the airline and travel industry. The reconciliation of each of these measures to the most comparable GAAP measure for the periods is indicated below. Reconciliation of Non-GAAP Financial Measures View original content to download multimedia:https://www.prnewswire.com/news-releases/allegiant-travel-company-second-quarter-2026-financial-results-302842863.html

The market expects Allegiant Travel (ALGT) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates. The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on August 4. On the other hand, if they miss, the stock may move lower. While management's discussion of business conditions on the earnings call will mostly determine the sustainability of the immediate price change and future earnings expectations, it's worth having a handicapping insight into the odds of a positive EPS surprise. This travel services company is expected to post quarterly earnings of $1.27 per share in its upcoming report, which represents a year-over-year change of +3.3%. Revenues are expected to be $1.03 billion, up 49.4% from the year-ago quarter. The consensus EPS estimate for the quarter has been revised 103.56% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. This insight is at the core of our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction). The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For Allegiant Travel, the Most Accurate Estimate is the same as the Zacks Consensus Estimate, suggesting that there are no recent analyst views which differ from what have been considered to derive the consensus estimate. This has resulted in an Earnings ESP of 0%. On the other hand, the stock currently carries a Zacks Rank of #2. So, this combination makes it difficult to conclusively predict that Allegiant Travel will beat the consensus EPS estimate. Analysts often consider to what extent a company has been able to match consensus estimates in the past while calculating their estimates for its future earnings. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that Allegiant Travel would post earnings of $3.4 per share when it actually produced earnings of $3.77, delivering a surprise of +10.88%. Over the last four quarters, the company has beaten consensus EPS estimates three times. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. Allegiant Travel doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Allegiant Travel Company (ALGT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

American Airlines (AAL) came out with quarterly earnings of $0.15 per share, beating the Zacks Consensus Estimate of $0.03 per share. This compares to earnings of $0.95 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +400.00%. A quarter ago, it was expected that this world's largest airline would post a loss of $0.45 per share when it actually produced a loss of $0.4, delivering a surprise of +11.11%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. American Airlines, which belongs to the Zacks Transportation - Airline industry, posted revenues of $16.74 billion for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 0.22%. This compares to year-ago revenues of $14.39 billion. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. American Airlines shares have lost about 3.5% since the beginning of the year versus the S&P 500's gain of 9.6%. While American Airlines has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for American Airlines was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $0.31 on $15.86 billion in revenues for the coming quarter and $0.57 on $62.71 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Transportation - Airline is currently in the top 31% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Allegiant Travel (ALGT), has yet to report results for the quarter ended June 2026. The results are expected to be released on August 4. This travel services company is expected to post quarterly earnings of $1.27 per share in its upcoming report, which represents a year-over-year change of +3.3%. The consensus EPS estimate for the quarter has been revised 103.3% higher over the last 30 days to the current level. Allegiant Travel's revenues are expected to be $1.03 billion, up 49.2% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report American Airlines Group Inc. (AAL) : Free Stock Analysis Report Allegiant Travel Company (ALGT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research