# Allegiant Travel CO (ALGT) Informational only - not investment advice. CIK: 0001362468 SIC: 4512 Air Transportation, Scheduled SIC breadcrumb: [Transportation, Communications, Electric, Gas, And Sanitary Services](/division/E/) > [SIC Major Group 45](/major-group/45/) > [SIC 4512 Air Transportation, Scheduled](/industry/4512/) Latest 10-K filed: 2026-02-26 SEC page: https://www.sec.gov/edgar/browse/?CIK=1362468 Filing source: https://www.sec.gov/Archives/edgar/data/1362468/000136246826000008/algt-20251231.htm ## Selected Fundamentals | Metric | Value | Unit | FY | Filed | | --- | ---: | --- | ---: | --- | | Revenue | 2606579000 | USD | 2025 | 2026-02-26 | | Net income | -44697000 | USD | 2025 | 2026-02-26 | | Assets | 4209401000 | USD | 2025 | 2026-02-26 | ## Financials Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-26. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001362468.json. Derived margins are computed from the extracted annual SEC facts. | Metric | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Revenue | 1,378,942,000 | 1,511,203,000 | 1,667,447,000 | 1,840,965,000 | 990,073,000 | 1,707,910,000 | 2,301,829,000 | 2,509,857,000 | 2,512,589,000 | 2,606,579,000 | | Net income | 220,866,000 | 198,148,000 | 161,802,000 | 232,117,000 | -184,093,000 | 151,853,000 | 2,493,000 | 117,596,000 | -240,238,000 | -44,697,000 | | Operating income | 372,567,000 | 230,630,000 | 243,459,000 | 363,950,000 | -280,985,000 | 263,075,000 | 91,646,000 | 220,981,000 | -239,976,000 | 37,167,000 | | Diluted EPS | 13.29 | 12.13 | 10.00 | 14.26 | -11.53 | 8.68 | 0.14 | 6.29 | -13.49 | -2.48 | | Assets | 1,671,576,000 | 2,180,157,000 | 2,498,668,000 | 3,010,803,000 | 3,258,925,000 | 3,991,073,000 | 4,511,297,000 | 4,856,667,000 | 4,429,853,000 | 4,209,401,000 | | Liabilities | 1,197,954,000 | 1,626,846,000 | 1,808,347,000 | 2,127,252,000 | 2,559,562,000 | 2,767,521,000 | 3,290,599,000 | 3,528,107,000 | 3,340,461,000 | 3,156,724,000 | | Stockholders' equity | 473,622,000 | 553,311,000 | 690,321,000 | 883,551,000 | 699,363,000 | 1,223,552,000 | 1,220,698,000 | 1,328,560,000 | 1,089,392,000 | 1,052,677,000 | | Cash and cash equivalents | 64,711,000 | 59,449,000 | 81,520,000 | 121,888,000 | 152,764,000 | 363,378,000 | 229,989,000 | 143,259,000 | 285,892,000 | 172,696,000 | | Net margin | 16.02% | 13.11% | 9.70% | 12.61% | -18.59% | 8.89% | 0.11% | 4.69% | -9.56% | -1.71% | | Operating margin | 27.02% | 15.26% | 14.60% | 19.77% | -28.38% | 15.40% | 3.98% | 8.80% | -9.55% | 1.43% | ## Quarterly Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-05-06. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001362468.json. Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived. | Quarter | End date | Revenue | Net income | Diluted EPS | Method | | --- | --- | ---: | ---: | ---: | --- | | 2022-Q2 | 2022-06-30 | | | 0.24 | reported discrete quarter | | 2022-Q3 | 2022-09-30 | | | -2.58 | reported discrete quarter | | 2023-Q1 | 2023-03-31 | | | 3.09 | reported discrete quarter | | 2023-Q2 | 2023-06-30 | 683,810,000 | 88,469,000 | 4.80 | reported discrete quarter | | 2023-Q3 | 2023-09-30 | 565,359,000 | -25,066,000 | -1.44 | reported discrete quarter | | 2023-Q4 | 2023-12-31 | 611,002,000 | -1,956,000 | | derived Q4 = FY annual - nine-month YTD | | 2024-Q1 | 2024-03-31 | 656,406,000 | -919,000 | -0.07 | reported discrete quarter | | 2024-Q2 | 2024-06-30 | 666,283,000 | 13,699,000 | 0.75 | reported discrete quarter | | 2024-Q3 | 2024-09-30 | 562,196,000 | -36,789,000 | -2.05 | reported discrete quarter | | 2024-Q4 | 2024-12-31 | 627,705,000 | -216,230,000 | | derived Q4 = FY annual - nine-month YTD | | 2025-Q1 | 2025-03-31 | 699,074,000 | 32,102,000 | 1.73 | reported discrete quarter | | 2025-Q2 | 2025-06-30 | 689,384,000 | -65,166,000 | -3.62 | reported discrete quarter | | 2025-Q3 | 2025-09-30 | 561,932,000 | -43,574,000 | -2.41 | reported discrete quarter | | 2025-Q4 | 2025-12-31 | 656,189,000 | 31,941,000 | | derived Q4 = FY annual - nine-month YTD | | 2026-Q1 | 2026-03-31 | 732,432,000 | 42,478,000 | 2.30 | reported discrete quarter | ## Macro Cross-References - [CPIAUCSL](/indicator/CPIAUCSL/): Consumer Price Index for All Urban Consumers: All Items in U.S. City Average - [UNRATE](/indicator/UNRATE/): Unemployment Rate - [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate - [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private - [DFEDTARU](/indicator/DFEDTARU/): Federal Funds Target Range - Upper Limit - [DFEDTARL](/indicator/DFEDTARL/): Federal Funds Target Range - Lower Limit - [DGS3MO](/indicator/DGS3MO/): Market Yield on U.S. Treasury Securities at 3-Month Constant Maturity - [DGS2](/indicator/DGS2/): Market Yield on U.S. Treasury Securities at 2-Year Constant Maturity - [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity - [DGS30](/indicator/DGS30/): Market Yield on U.S. Treasury Securities at 30-Year Constant Maturity - [T10Y2Y](/indicator/T10Y2Y/): 10-Year Treasury Constant Maturity Minus 2-Year Treasury Constant Maturity - [CPILFESL](/indicator/CPILFESL/): Consumer Price Index for All Urban Consumers: All Items Less Food and Energy - [CPIUFDSL](/indicator/CPIUFDSL/): Consumer Price Index for All Urban Consumers: Food - [CPIENGSL](/indicator/CPIENGSL/): Consumer Price Index for All Urban Consumers: Energy - [CUSR0000SAH1](/indicator/CUSR0000SAH1/): Consumer Price Index for All Urban Consumers: Shelter - [PCEPI](/indicator/PCEPI/): Personal Consumption Expenditures: Chain-type Price Index - [PCEPILFE](/indicator/PCEPILFE/): Personal Consumption Expenditures Excluding Food and Energy: Chain-type Price Index - [PPIACO](/indicator/PPIACO/): Producer Price Index by Commodity: All Commodities - [T10YIE](/indicator/T10YIE/): 10-Year Breakeven Inflation Rate - [U6RATE](/indicator/U6RATE/): Total Unemployed, Plus All Marginally Attached Workers Plus Total Employed Part Time for Economic Reasons - [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm - [CIVPART](/indicator/CIVPART/): Labor Force Participation Rate - [EMRATIO](/indicator/EMRATIO/): Employment-Population Ratio - [UNEMPLOY](/indicator/UNEMPLOY/): Unemployed - [CE16OV](/indicator/CE16OV/): Employment Level - [ICSA](/indicator/ICSA/): Initial Claims - [JTSJOL](/indicator/JTSJOL/): Job Openings: Total Nonfarm - [JTSQUR](/indicator/JTSQUR/): Quits: Total Nonfarm - [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product - [A191RL1Q225SBEA](/indicator/A191RL1Q225SBEA/): Real Gross Domestic Product: Percent Change from Preceding Period - [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index - [TCU](/indicator/TCU/): Capacity Utilization: Total Index - [HOUST](/indicator/HOUST/): New Privately-Owned Housing Units Started: Total Units - [PERMIT](/indicator/PERMIT/): New Privately-Owned Housing Units Authorized in Permit-Issuing Places: Total Units - [RSAFS](/indicator/RSAFS/): Advance Retail Sales: Retail Trade - [PCE](/indicator/PCE/): Personal Consumption Expenditures - [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income - [PSAVERT](/indicator/PSAVERT/): Personal Saving Rate - [M2SL](/indicator/M2SL/): M2 - [BOPGSTB](/indicator/BOPGSTB/): U.S. International Trade in Goods and Services: Balance - [MSPUS](/indicator/MSPUS/): Median Sales Price of Houses Sold for the United States - [HSN1F](/indicator/HSN1F/): New One Family Houses Sold: United States - [RHORUSQ156N](/indicator/RHORUSQ156N/): Homeownership Rate in the United States - [TTLCONS](/indicator/TTLCONS/): Total Construction Spending: Total Construction in the United States - [RRVRUSQ156N](/indicator/RRVRUSQ156N/): Rental Vacancy Rate in the United States - [TOTALSL](/indicator/TOTALSL/): Total Consumer Credit Owned and Securitized - [REVOLSL](/indicator/REVOLSL/): Revolving Consumer Credit Owned and Securitized - [DRCCLACBS](/indicator/DRCCLACBS/): Delinquency Rate on Credit Card Loans, All Commercial Banks - [GDP](/indicator/GDP/): Gross Domestic Product - [GPDI](/indicator/GPDI/): Gross Private Domestic Investment - [GCE](/indicator/GCE/): Government Consumption Expenditures and Gross Investment - [PCEC](/indicator/PCEC/): Personal Consumption Expenditures - [NETEXP](/indicator/NETEXP/): Net Exports of Goods and Services - [GFDEBTN](/indicator/GFDEBTN/): Federal Debt: Total Public Debt - [GFDEGDQ188S](/indicator/GFDEGDQ188S/): Federal Debt: Total Public Debt as Percent of Gross Domestic Product - [FYFSD](/indicator/FYFSD/): Federal Surplus or Deficit - [FGRECPT](/indicator/FGRECPT/): Federal Government Current Receipts - [FGEXPND](/indicator/FGEXPND/): Federal Government: Current Expenditures - [MANEMP](/indicator/MANEMP/): All Employees, Manufacturing - [USCONS](/indicator/USCONS/): All Employees, Construction - [USTRADE](/indicator/USTRADE/): All Employees, Retail Trade - [USFIRE](/indicator/USFIRE/): All Employees, Financial Activities - [USGOVT](/indicator/USGOVT/): All Employees, Government - [AWHAETP](/indicator/AWHAETP/): Average Weekly Hours of All Employees, Total Private - [DGORDER](/indicator/DGORDER/): Manufacturers' New Orders: Durable Goods - [NEWORDER](/indicator/NEWORDER/): Manufacturers' New Orders: Nondefense Capital Goods Excluding Aircraft - [BUSINV](/indicator/BUSINV/): Total Business Inventories - [EXPGS](/indicator/EXPGS/): Exports of Goods and Services - [IMPGS](/indicator/IMPGS/): Imports of Goods and Services - [IR](/indicator/IR/): Import Price Index (End Use): All Commodities - [PPIFIS](/indicator/PPIFIS/): Producer Price Index by Commodity: Final Demand ## Latest quarter (10-Q) Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1362468/000136246826000022/algt-20260331.htm Extracted between Part I Item 2 and the next Item 3/4 or Part II heading after HTML sanitization. Confidence: high Filing date: 2026-05-06 Report date: 2026-03-31 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis presents factors that had a material effect on our results of operations during the three months ended March 31, 2026 and 2025. Also discussed is our financial position as of March 31, 2026 and December 31, 2025. You should read this discussion in conjunction with our unaudited consolidated financial statements, including the notes thereto, appearing elsewhere in this Form 10-Q and our consolidated financial statements appearing in our annual report on Form 10-K for the year ended December 31, 2025. This discussion and analysis contains forward-looking statements. Please refer to the section below entitled “Cautionary Note Regarding Forward-Looking Statements” for a discussion of the uncertainties, risks and assumptions associated with these statements. First Quarter 2026 Review First quarter 2026 highlights include: •Signed the Merger Agreement to acquire Sun Country and received the necessary regulatory approvals to close the Merger •Record first quarter total operating revenue of $732.4 million, up 9.6 percent year-over-year when excluding prior year Sunseeker results •Fixed fee revenue of $18.1 million, up 11.5 percent year-over-year •Total revenue per available seat mile (TRASM) up 16.4 percent year-over-year •Airline-only operating cost per available seat mile (CASM), excluding fuel and special charges of 8.64 ¢, up 7.1 percent year-over-year •System capacity down 5.9 percent year-over-year •Available seat miles per gallon of fuel of 86.7, up 1.2 percent year-over-year •$39.3 million in total cobrand credit card remuneration received, up 8.9 percent year-over-year AIRCRAFT The following table sets forth the aircraft in service and operated by us as of the dates indicated: March 31, 2026 December 31, 2025 Airbus A320(1) 78  79  Airbus A319(2) 28  28  Boeing 737-8200 17  16  Total 123  123  (1)Includes 23 aircraft under finance lease and 9 aircraft under operating lease as of March 31, 2026 and December 31, 2025. Excludes two aircraft under operating lease as of March 31, 2026 and three aircraft under operating lease as of December 31, 2025, which were removed from service pending redelivery. (2)Excludes three aircraft under operating lease that were removed from service pending redelivery as of December 31, 2025. As of March 31, 2026, we are party to forward purchase agreements for 33 aircraft with deliveries expected between 2026 and 2028. Due to the heavy maintenance needs on certain aging Airbus airframes and capacity constraints at the maintenance, repair, and overhaul contractors, we identified aging airframes for early retirement to coincide with the delivery schedule for our 737 MAX aircraft provided in an amendment to our Boeing purchase agreement signed in September 2023. As of March 31, 2026, 16 airframes have been retired, with eight additional retirements scheduled between May 2026 and January 2027. The accelerated depreciation resulting from the revised estimated useful life of these aircraft is recorded as a special charge in the consolidated financial statements, including $1.3 million recognized in first quarter 2026. The engines from these aircraft will be retained for future overhaul cost mitigation and may be sold on an opportunistic basis if we determine the engine has no better economic use in our operating fleet. NETWORK As of March 31, 2026, we were selling 576 routes versus 577 as of the same date in 2025. Network growth in the future will continue to be affected by high fuel prices, the timing of aircraft deliveries, aircraft in heavy maintenance, airport construction and disruption, trends in domestic, leisure air travel demand and other factors such as macroeconomic conditions and geopolitical unrest. We have identified over 1,400 incremental domestic nonstop routes as opportunities for future network growth, of which over 75 percent currently have no non-stop service. Our total active number of origination cities and leisure destinations were 91 and 35, respectively, as of March 31, 2026. Our unique model is predicated around expanding and contracting capacity to meet seasonal leisure travel demands. 17 TRENDS Proposed Acquisition of Sun Country Airlines In January 2026, we entered into an agreement to acquire Sun Country Airlines, subject to satisfaction of customary closing conditions, including each company's receipt of shareholder approval and regulatory reviews and approvals (please see Note 11 to the consolidated financial statements included in this report). We believe the proposed transaction aligns with our long-term strategic objectives and is expected to enhance our network breadth, operational flexibility, and ability to respond to demand shifts, while supporting scheduled service, charter and cargo operations of both airlines. Integration planning activities are underway, while both companies continue to operate independently and maintain normal business operations. We now expect the closing of the transaction to occur as early as May 13, 2026, following shareholder approval at special meetings scheduled to be held by both companies on May 8, 2026. There are several risks associated with the completion of the proposed transaction, as well as risks related to future operations if the transaction is completed, and future results of operations may be affected by regulatory outcomes, integration considerations, transaction-related costs, and other factors. Aircraft Fuel The cost of fuel, including refining costs and applicable crack spreads, remains volatile, and are influenced by numerous economic and geopolitical factors beyond our control or prediction, including geopolitical conflict and war. The recent escalation of hostilities in the Middle East has significantly impacted the market prices of products that are derived from crude oil. Our first quarter fuel expense was $180.2 million, or $3.04 per gallon, which is 16.5 percent higher than the $2.61 we paid in first quarter 2025. As the geopolitical unrest in the Middle East began in late February, the volatility only impacted our results for approximately one month of the quarter. However, as this situation persists, we may continue to see significant increases in fuel costs that will materially impact our overall cost structure, operating results and profitability. We have not used financial derivative products to hedge against fuel price volatility, nor do we have any plans to do so in the future. Demand Environment Although air travel demand in the first part of 2026 has been strong, demand could be impacted in the future by macroeconomic, geopolitical, and airline industry events as it has in the past. In first quarter 2026, we strategically reduced off-peak day of week capacity and, in turn, increased peak day ASMs on fewer total aircraft year-over year. This contributed to a 3.9 percentage point increase in load factor on a 5.9 percentage decrease in capacity. We expect to continue to manage our peak period utilization as the demand environment allows. Boeing Agreement We have signed an agreement and amendments with Boeing to purchase 50 newly manufactured 737 MAX aircraft with options to purchase up to an additional 80 737 MAX aircraft. We have taken delivery of 17 MAX aircraft from this order and all of these aircraft are currently in revenue service. We believe this new aircraft purchase is complementary with our low-cost strategy based on our intent to retain ownership of the aircraft, the longer useful life for depreciation purposes, and expected fuel savings and operational reliability from the use of these new aircraft. There continues to be regulatory focus on increasing quality control standards at Boeing and its suppliers with the aim of stabilizing aircraft production. These factors and the requirements for Boeing to obtain routine and necessary regulatory approvals could delay deliveries to us beyond management's current expectations. We currently expect ten more aircraft to be delivered to us in the last nine months of 2026. Delays in aircraft deliveries could impact our ability to schedule additional growth when the demand environment allows. Union Negotiations The collective bargaining agreement with our pilots has been amendable since 2021. We and the International Brotherhood of Teamsters ("IBT") jointly requested the mediation services of the National Mediation Board in January 2023 to assist with the negotiations. The mediation process with the NMB is continuing. At this time, the announced acquisition of Sun Country has not changed the mediation process. Separately from the ongoing collective bargaining agreement negotiations, to address retention and pilot pay issues and increase pilot staffing levels, effective in May 2023, we began accruing a retention bonus, with IBT's agreement, for pilots who continue employment with us until a new labor agreement is approved. The amount being accrued is 35 percent of current hourly pay rates, except for our first year first officers for whom the percentage is 82 percent, in each case, calculated at a minimum of 85 pay credit hours per month. Our implementation of the retention bonus has allowed us to effectively increase pay rates for our pilot team members (by way of the accrual of the retention bonus), add pilots through hiring and significantly slow attrition. For the three months ended March 31, 2026, we recorded estimated pilot retention bonus accruals of $20.1 million, bringing the total accrual to $256.0 million as of March 31, 2026, including the related payroll taxes. The bonus will be paid to all pilots remaining employed with us after ratification of a new collective bargaining agreement. 18 RESULTS OF OPERATIONS Comparison of three months ended March 31, 2026 to three months ended March 31, 2025 Operating Revenue Three Months Ended March 31, Percent Change Operating Revenues (in thousands) 2026 2025 YoY Passenger $ 671,799  $ 616,750  8.9  % Third party products 42,335  35,203  20.3 Fixed fee contracts 18,123  16,252  11.5 Resort and other 175  30,869  NM Total operating revenues $ 732,432  $ 699,074  4.8 NM    Not meaningful Passenger revenue. Passenger revenue increased $55.0 million or 8.9 percent compared to first quarter 2025. The increase was primarily driven by strong leisure demand, which resulted in a 19.8 percent increase in average scheduled service base fare and a 3.9 percentage point improvement in scheduled service load factor, on a 5.9 percent decrease in scheduled service capacity. Third party products revenue. Third party products revenue for first quarter 2026 increased $7.1 million or 20.3 percent compared to first quarter 2025. The increase was primarily attributable to a $5.1 million increase in the marketing component of co-brand revenue, a $1.7 million increase in rental car revenue, and a $1.3 million increase in revenue from the sales of a third party travel insurance product. These increases were offset by a $0.6 million decrease in third party hotel revenue as the result of a decrease in the number of room nights sold. Fixed fee contract revenue. Fixed fee contract revenue increased $1.9 million or 11.5 percent in first quarter 2026. The increase was driven by a 5.5 percent increase in fixed fee departures and a 5.7 percent increase in revenue per departure, reflecting continued strength in sports flying during March Madness. Resort and other revenue. Resort and other revenues decreased compared to the prior-year period as we sold Sunseeker Resort on September 4, 2025. Operating Expenses The following table presents airline only operating unit costs on a per available seat mile (ASM) basis, defined as Operating CASM, for the indicated periods. Excluding fuel on a per ASM basis provides management and investors the ability to measure and monitor our c [Excerpt truncated for page length; source filing is linked above.] ## Latest 10-K MD&A Extracted between Item 7 and the next Item 7A/8 heading after HTML sanitization. Confidence: high Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis presents factors that had a material effect on our results of operations during the years ended December 31, 2025 and 2024. Unless otherwise expressly stated, for discussion and analysis of 2024 and a comparison of our 2024 results to 2023 results, please refer to our Annual Report on Form 10-K for the year ended December 31, 2024, under Part II Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations. Also discussed is our financial position as of December 31, 2025 and 2024. Investors should read this discussion in conjunction with our consolidated financial statements, including the notes thereto, appearing elsewhere in this annual report. This discussion and analysis contains forward-looking statements. Please refer to the section entitled “Disclosure Regarding Forward-Looking Statements” at the beginning of this annual report on Form 10-K for a discussion of the uncertainties, risks and assumptions associated with these statements. 39 2025 Highlights •In January 2026, announced a definitive merger agreement under which Allegiant plans to acquire Sun Country Airlines •Record total airline-only operating revenue of $2.5 billion, up 4.3 percent year-over-year •Achieved controllable completion of 99.9% for the year •Airline-only operating CASM, excluding fuel and special charges of 8.04 cents, down 6.1 percent as compared with full-year 2024, on capacity growth of 12.6 percent •During the year, expanded the network by announcing 54 new routes, including service to eight new cities: Atlantic City (NJ), Burbank (CA), Columbia (MO), Fort Myers (FL), Huntsville (AL), La Crosse (WI), Philadelphia (PA), and Trenton (NJ) •Ranked 2nd best airline among major US carriers in the Wall Street Journal's "The Best and Worst Airlines of 2025" •The only US Airline named by Newsweek as one of America's Most Loved Brands 2025 •Named Best Airline Credit Card by USA TODAY's Readers' Choice Awards for the seventh consecutive year and Best Frequent Flyer Program by USA TODAY's Readers' Choice Awards for the second consecutive year •$139.6 million in total co-brand credit card remuneration received from Bank of America, up 3.6 percent from the prior year •Ended the year with 21 million total active Allways Rewards members •Completed the sale of Sunseeker Resort on September 4, 2025 •Published the company's fourth annual sustainability report AIRCRAFT Operating Fleet The following table sets forth the number and type of aircraft in service and operated by us as of the dates indicated. All of the aircraft in our fleet as of December 31, 2025 are owned by us except as indicated in the footnotes to the table: As of December 31, 2025 2024 2023 A320(1) 79  87  92  A319(2) 28  34  34  737-8200 16  4  —  Total 123  125  126  (1)Includes 23 aircraft under finance lease and 9 aircraft under operating lease as of December 31, 2025, and 23 aircraft under finance lease and 13 aircraft under operating lease as of December 31, 2024 and December 31, 2023. As of December 31, 2025, excludes three aircraft under operating lease which have been removed from service pending redelivery. (2)As of December 31, 2025, excludes three aircraft under operating lease which have been removed from service pending redelivery. Includes four aircraft under operating lease as of December 31, 2024, and December 31, 2023. As of December 31, 2025, we are party to forward purchase agreements for 34 aircraft with 11 deliveries expected in 2026, 15 in 2027, and the remainder in 2028. The timing of these deliveries is based on management's best estimates and differs from the contract in place. Refer to Part I - Item 2. Properties for further detail regarding our aircraft fleet. 40 NETWORK As of February 1, 2026, and including service announcements through that date, we were selling travel on 578 routes to 126 cities in 42 states. These include 39 routes scheduled to begin service in 2026. Network growth in the future will continue to be affected by timing of aircraft deliveries, aircraft in heavy maintenance, airport construction and disruptions, trends in domestic, leisure air travel demand and other factors. We have identified over 1,400 incremental domestic nonstop routes as opportunities for future network growth, of which over 75 percent currently have no nonstop service. Our total number of origination cities and leisure destinations were 91 and 35, respectively, as of February 1, 2026, including announced routes. Our unique model is predicated on expanding and contracting capacity to meet seasonal leisure travel demands. The following table shows the number of leisure destinations and cities served as of the dates indicated (includes cities served seasonally): As of December 31, 2025 2024 2023 Leisure destinations 34  34  33  Origination cities 88  87  91  Total cities 122  121  124  Total routes 540 541 544 TRENDS Proposed Acquisition of Sun Country Airlines In January 2026, we entered into an agreement to acquire Sun Country subject to satisfaction of customary closing conditions, including each company's receipt of certain shareholder approvals and regulatory reviews and approvals. See Item 1. Business - "Announced Acquisition of Sun Country Airlines." We believe the proposed transaction aligns with our long-term strategic objectives and is expected to enhance our network breadth, operational flexibility, and ability to respond to demand shifts, while supporting scheduled service, charter and cargo operations of both airlines. We believe the combination of our two financially strong leisure carriers in the U.S. will create benefits for customers, communities, employees, and partners by enhancing stability, expanding opportunities, and enabling continued investment and innovation. There are several risks associated with whether or not the transaction will close and also with respect to future operations if the transaction does close. See Item 1A. Risk Factors - "Risks Related to our Proposed Acquisition of Sun Country Airlines Holdings, Inc.” Future results of operations will be affected by the timing of regulatory approvals, integration considerations, transaction costs and other factors. Business and Macroeconomic Conditions Consumer confidence vacillated during 2025, which along with other macroeconomic and airline industry events, initially contributed to a general decline in consumer spending and, in particular, softened demand for domestic, leisure air travel. Although demand fluctuates, macroeconomic uncertainty persists, driven by factors such as trade policies and tariffs. These factors have impacted our fares, load factors, and profitability. Our results of operations may continue to be impacted while these conditions persist. We continue to monitor how these factors could impact our business and take steps to mitigate their effect on our business. Aircraft Fuel The cost of fuel is volatile, as it is subject to many economic and geopolitical factors we can neither control nor predict. Significant increases in fuel costs could materially affect our operating results and profitability. We have not sought to use financial derivative products to hedge our exposure to fuel price volatility, nor do we have any plans to do so in the future. Elevated fuel costs in the future may impact our overall cost structure and operating results. Boeing Agreement We have signed an agreement and amendments with Boeing to purchase 50 newly manufactured 737 MAX aircraft with options to purchase up to an additional 80 737 MAX aircraft. We have taken delivery of 16 MAX aircraft from this order and all 16 aircraft are currently in revenue service. We believe this new aircraft purchase is complementary with our low-cost strategy based on our intent to retain ownership of the aircraft, the longer useful life for depreciation purposes, and expected fuel savings and operational reliability from the use of these new aircraft. 41 There continues to be regulatory focus on increasing quality control standards at Boeing and its suppliers with the aim of stabilizing aircraft production. These factors and the requirements for Boeing to obtain routine and necessary regulatory approvals could delay deliveries to us beyond management's current expectations. Although the contract provides for more deliveries, at this time, we currently expect eleven aircraft to be delivered to us in 2026. Further delays in aircraft deliveries will impact our ability to schedule additional growth in late 2026 and beyond. Union Negotiations The collective bargaining agreement with our pilots has been amendable since 2021. We and the International Brotherhood of Teamsters ("IBT") jointly requested the mediation services of the National Mediation Board in January 2023 to assist with the negotiations. The mediation process with the NMB is continuing. At this time, the announced acquisition of Sun Country has not changed the mediation process. Separately from the ongoing collective bargaining agreement negotiations, to address retention and pilot pay issues and increase pilot staffing levels, effective in May 2023, we began accruing a retention bonus, with IBT's agreement, for pilots who continue employment with us until a new labor agreement is approved. The amount being accrued is 35 percent of current hourly pay rates, except for our first year first officers for whom the percentage is 82 percent, in each case, calculated at a minimum of 85 pay credit hours per month. Our implementation of the retention bonus has allowed us to effectively increase pay rates for our pilot team members (by way of the accrual of the retention bonus), add pilots through hiring and significantly slow attrition. For the year ended December 31, 2025, we recorded estimated pilot retention bonus accruals of $89.8 million bringing the total accrual to $235.9 million at year end, including the related payroll taxes. The bonus will be paid to all pilots remaining employed with us after ratification of a new collective bargaining agreement. Network Expansion We have identified more than 1,400 incremental routes as opportunities for future network growth, with approximately 75 percent of these additional routes having no current nonstop service. Our ability to add significant numbers of new routes has been constrained in recent years by aircraft availability, flight crew staffing, high fuel costs, economic conditions and other factors. During 2026, we expect to continue focusing on the strategic utilization of our fleet, particularly during peak demand periods with only minimal scheduled service growth expected at this time. We anticipate that projected fleet growth after 2026 will provide additional flexibility to pursue network expansion opportunities. Sunseeker Resort In September 2025, we completed the sale of Sunseeker Resort. The sale aligns with our strategic focus on our core Airline operations. 42 Our Operating Expenses A brief description of the items included in our operating expense line items follows. Salaries and benefits expense includes wages, salaries, employee bonuses and pilot retention bonus accruals, as well as expenses associated with employee benefit plans, stock compensation expense related to equity grants, and employer payroll taxes. Salaries and benefits expense also includes such costs for Sunseeker Resort personnel through the sale of the Resort in September 2025. Aircraft fuel expense includes the cost of aircraft fuel, fuel taxes, into plane fees and airport fuel flowage, storage or throughput fees.  Station operations expense includes the fees charged by airports for the use or lease of airport facilities and fees charged by third party vendors for ground handling services, commissary expenses, and other related services. Station operations expense also includes most of our irregular operations costs. Depreciation and amortization expense includes the depreciation of all owned fixed assets, including aircraft and engines, Sunseeker Resort assets (until determined to be an asset held for sale in June 2025), and assets recorded in connection with finance leases. Also included is the amortization of heavy maintenance expenses on our aircraft and engines, which are capitalized under the deferral method of accounting and amortized as a component of depreciation and amortization expense over the estimated period until the next scheduled major maintenance event. Maintenance and repairs expense includes all parts, materials and spares required to maintain our aircraft. Also included are fees for repairs performed by third party vendors. Sales and marketing expense includes all advertising, promotional expenses, sponsorships, travel agent commissions, debit and credit card processing fees associated with the sale of scheduled service and air-related ancillary charges. Prior to the sale of Sunseeker Resort on September 4, 2025, sales and marketing expense also included costs related to advertising and marketing for the Resort, and credit card processing fees for Resort bookings. Aircraft lease rentals expense consists of the cost of leasing aircraft under operating leases with third parties as well as the cost for sub-service which may be utilized in order to accommodate passengers in the event of operational disruption. Other expense includes travel and training expenses for crews and ground personnel, facility lease expenses, professional fees, personal property taxes, information technology consulting, the cost of passenger liability insurance, aircraft hull insurance and all other insurance policies, excluding employee welfare insurance. Additionally, this expense includes gains and losses on disposals of aircraft and other equipment, and all other administrative and operational overhead expenses not included in other line items above. Special charges for 2025 include expenses related to organizational restructuring driven by reduced air travel demand amid heightened macroeconomic uncertainty, accelerated amortization and disposal of software identified for redevelopment, costs related to the proposed acquisition of Sun Country Airlines, and charges related to the sale of Sunseeker Resort. Additional special charges in 2025, 2024, and 2023 include costs associated with the accelerated retirement of 24 airframes to align with planned 737 MAX aircraft deliveries, a ratification bonus for our flight attendants in 2024, an impairment charge in 2024 for Sunseeker Resort, as well as losses incurred at the Resort from hurricanes and other severe weather events, net of insurance recoveries. 43 RESULTS OF OPERATIONS 2025 compared to 2024 Operating Revenue Year Ended December 31, Percent Change Operating Revenues (in thousands) 2025 2024 YoY Passenger $ 2,324,348  $ 2,217,059  4.8  % Third party products 143,188  142,128  0.7 Fixed fee contracts 77,647  80,660  (3.7) Resort and other 61,396  72,742  (15.6) Total operating revenues $ 2,606,579  $ 2,512,589  3.7 Passenger revenue. Passenger revenue increased $107.3 million or 4.8 percent in 2025 compared to 2024, driven by a 10.5 percent increase in scheduled service passengers on a 13.1 percent increase in scheduled service departures. The increase in scheduled service passengers was offset by a 5.3 percent decrease in scheduled service total fare, which largely resulted from a 12.3 percent decline in average base fare due to demand softness in the industry. This decrease was partially offset by a 1.9 percent increase in average fare for air-related charges. Over the last year, revenues for air-related charges have been bolstered by sales of our Allegiant Extra product. Since December 31, 2024, we have configured an additional 31 aircraft with the extra legroom seating for our Allegiant Extra offering, bringing the total number to 87 aircraft as of December 31, 2025. The restoration of functionality around our third party bundled product offering, which began in late 2024, has also contributed to ancillary revenue increases over the last year. Third party products revenue. Third party products revenue increased $1.1 million or 0.7 percent in 2025 compared to 2024. The increase was driven by a $3.8 million increase in revenue from sales of a third party travel insurance product, as well as a $1.4 million increase from sales of rental cars. These increases were partially offset by a $3.7 million decrease in the marketing component of co-brand revenue as certain bonus compensation was phased out in late 2024 and a decline in revenue from sales of hotel rooms. Fixed fee contract revenue. Fixed fee contract revenue decreased $3.0 million or 3.7 percent in 2025 compared to 2024. While fixed fee departures were consistent year over year, revenue per departure declined due to operating a higher proportion of ad-hoc charter flights, which generated lower fuel pass through contributions (the fuel pass throughs being accounted for as revenue) driven by the decrease in average fuel prices year over year. Resort and other revenue. Resort and other revenue decreased $11.3 million or 15.6 percent primarily due to the sale of Sunseeker Resort on September 4, 2025, resulting in approximately four fewer months of revenue included in 2025 compared to 2024. Operating Expenses The following table presents airline only operating unit costs on a per ASM basis, defined as Operating CASM, for the indicated periods. Excluding fuel on a per ASM basis provides management and investors the ability to measure and monitor our cost performance absent fuel price volatility. Both the cost and availability of fuel are subject to many economic and political factors beyond our control. Excluding special charges allows management and investors to better compare our airline unit costs with those of other airlines. 44 Year Ended December 31, Percent Change Airline Unitized Costs (in cents) 2025 2024 YoY Salaries and benefits 3.77   ¢ 4.06   ¢ (7.1) % Aircraft fuel 2.99  3.31  (9.7) Station operations 1.39  1.44  (3.5) Depreciation and amortization 1.13  1.22  (7.4) Maintenance and repairs 0.70  0.66  6.1  Sales and marketing 0.44  0.52  (15.4) Aircraft lease rentals 0.17  0.12  41.7  Other 0.44  0.54  (18.5) Special charges 0.21  0.24  (12.5) Airline operating CASM 11.24   ¢ 12.11   ¢ (7.2) Airline operating CASM, excluding fuel 8.25   ¢ 8.80   ¢ (6.3) Airline operating CASM, excluding fuel and special charges 8.04   ¢ 8.56   ¢ (6.1) Airline operating CASM, excluding fuel and airline special charges. Airline operating CASM, excluding fuel and airline special charges, decreased by 6.1 percent to 8.04 ¢ from 8.56 ¢ in 2024. The primary driver of the CASM-ex decrease was a 12.6 percent increase in ASMs, as we grew into our existing infrastructure. In particular, we achieved the increased capacity with no increase to the average number of aircraft in service. A majority of expense line items were lower on a per ASM basis due in part to the increase in capacity. With limited ASM growth currently expected in 2026, CASM-ex is expected to increase to some extent during the year. Salaries and benefits expense. Airline salaries and benefits expense increased $34.8 million or 4.5 percent in 2025 compared to 2024. The increase was primarily attributable to an increase in flight crew wages as the result of a 13.5 percent increase in total block hours flown resulting in part from our efforts to increase peak period utilization to pre-pandemic levels. Additionally, average flight crew wages increased due to an increase in average tenure. These increases were partially offset by savings from the organizational restructuring implemented in April 2025. Salaries and benefits expense at Sunseeker Resort decreased by $21.6 million or 43.9 percent primarily due to the sale of the Resort on September 4, 2025, resulting in approximately four fewer months of expense included in 2025 compared to 2024. In addition, during the period prior to the sale, average full-time equivalent employees declined as certain functions were outsourced and staffing levels were strategically adjusted to align with operational needs. Aircraft fuel expense. Aircraft fuel expense increased $12.0 million or 1.9 percent in 2025 compared to 2024. The increase was primarily driven by a 10.4 percent increase in fuel gallons consumed, attributable to a 12.6 percent increase in total system ASMs. This increase was partially offset by a 7.6 percent decrease in average fuel cost per gallon. Fuel efficiency improved by 1.9 percent year over year. Station operations expense. Station operations expense increased $24.7 million or 9.1 percent in 2025 compared to 2024. The increase was primarily driven by a 12.7 percent year-over-year increase in total system departures that resulted in a corresponding rise in airport and landing fees, ground handling, deicing costs, and other stations-related expenses. In addition, station operations expense increased due to higher rent expense resulting from rate increases at multiple stations. These increases were partially offset by a reduction in passenger compensation expense resulting from fewer irregular operations events compared to the prior year as our controllable completion increased to 99.9 percent in 2025. Depreciation and amortization expense. Airline depreciation and amortization expense increased $10.2 million or 4.4 percent in 2025 compared to 2024. This increase was primarily attributable to the addition of 12 new aircraft from our 737 MAX order, which were placed into service during 2025. Additionally, there was an increase in software amortization resulting from the airline's implementation of new enterprise resource planning systems throughout 2024 and 2025. These increases were partially offset by decreases in depreciation and heavy maintenance amortization associated with the retirement of six Airbus airframes during 2025. Sunseeker Resort depreciation and amortization decreased by $19.3 million in 2025 compared to 2024. Depreciation of the Resort's assets ceased upon meeting held-for-sale classification criteria in June 2025. In addition, depreciation expense recorded during the first half of 2025 was lower than the same period in 2024 as a result of an impairment charge recorded in fourth quarter 2024 which reduced the carrying amount of Resort assets. Maintenance and repairs expense. Maintenance and repairs expense increased by $24.5 million or 19.5 percent in 2025 compared to 2024, primarily as the result of the 12.6 percent increase in capacity. The increase was further driven by higher volumes of certain rotable part repairs and expendable consumption, as well as an increase in drop-in engine repairs during 45 2025. Maintenance and repairs expense was also impacted by tariffs and repairs to aircraft that we plan to return from operating leases. Sales and marketing expense. Airline sales and marketing expense decreased by $4.2 million or 4.2 percent in 2025 compared to 2024 driven by a decrease in sponsorship expenses and a decrease in credit card processing fees. Notably, credit card processing fees decreased year over year, despite an increase in passenger revenue. We have made strategic efforts throughout the year to manage card processing fees, including adding a new payment option for our customers and migrating to a lower-fee card processor for our buy-on-board transactions. Sunseeker Resort sales and marketing expense decreased by $2.7 million or 37.9 percent in 2025 compared to 2024 primarily due to the sale of Sunseeker Resort on September 4, 2025, resulting in approximately four fewer months of expense included in the year ended December 31, 2025 compared to 2024. Aircraft lease rentals. Aircraft lease rental expense increased $12.9 million or 54.8 percent in 2025 compared to 2024. The increase is attributable to estimated lease return costs we began to accrue in second quarter 2025 for certain aircraft on operating leases related to redeliveries in 2025 and future years. Other operating expense. Airline other operating expense decreased by $9.7 million or 9.5 percent in 2025 compared to 2024, reflecting reductions across several expense categories as a result of continued cost-management initiatives. These decreases were driven by lower corporate and crew travel, reduced crew administration and training costs, decreased legal expense, and lower corporate administrative costs during 2025. Other operating expenses were also impacted by gains and losses on sales of assets in each year. Sunseeker Resort other operating expense decreased $14.3 million or 29.6 percent in 2025 compared to 2024 primarily due to the sale of Sunseeker Resort on September 4, 2025, resulting in approximately four fewer months of expense included in the year ended December 31, 2025 compared to 2024. Special charges. Airline special charges were $43.5 million in 2025. Special charges included $8.0 million of accelerated depreciation on airframes identified for early retirement, $12.1 million related to corporate restructuring charges, $19.3 million related to accelerated amortization and disposal of certain internal-use software designated for redevelopment, and $4.1 million for initial professional services and other costs related to the proposed acquisition of Sun Country. Sunseeker Resort special charges were $94.2 million in 2025, which primarily related to the sale of the Resort and the associated Aileron Golf Course. This included an asset write-down charge of $100.4 million, slightly offset by $2.1 million in other items and adjustments associated with the sale. Special charges also included further offsets of $4.2 million for net insurance recoveries received during 2025, related to previous damage from weather events. Refer to Note 15 in the consolidated financial statements for additional information on the sale of Sunseeker Resort. Interest Expense and Income Interest expense, net of interest income and capitalized interest, increased by $23.9 million or 35.6 percent, compared to 2024. The increase was primarily driven by a $27.8 million decrease in capitalized interest resulting from the delivery of 12 aircraft from our 737 MAX order since December 31, 2024, as interest on the related acquisition debt is no longer eligible for capitalization. In addition, we recognized $7.9 million of losses on debt extinguishment, primarily associated with the early repayment of various debt instruments during 2025, including $3.4 million related to the repayment of the Sunseeker construction loan, all of which are reflected in interest expense. These increases were partially offset by a $14.1 million or 9.0 percent decrease in interest expense attributable to a lower average outstanding debt balance year over year and a reduction in the weighted‑average variable interest rate on our debt compared to 2024. Income taxes We recorded a $10.2 million tax benefit in 2025 compared to a $68.2 million tax benefit in 2024. The effective tax rates for 2025 and 2024 differed from the statutory federal income tax rate of 21.0 percent primarily due to state income taxes and the impact of permanent tax differences. 2024 compared to 2023 The comparison of our 2024 results to 2023 results is included in our Annual Report on Form 10-K for the year ended December 31, 2024, under Part II Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations. 46 Airline Operating Statistics The following table shows the airline operating statistics for the last three years. For the Year Ended December 31, Airline operating statistics (unaudited): 2025 2024 2023 Total system statistics: Passengers 18,737,151  16,982,836  17,342,236  Available seat miles (ASMs) (thousands) 21,369,532  18,984,711  18,772,110  Airline operating expense per ASM (CASM) (cents) 11.24  ¢ 12.11  ¢ 12.02  ¢ Fuel expense per ASM (cents) 2.99  ¢ 3.31  ¢ 3.71  ¢ Airline special charges per ASM (cents) 0.21  ¢ 0.24  ¢ 0.19  ¢ Airline operating CASM, excluding fuel and special charges (cents) 8.04  ¢ 8.56  ¢ 8.12  ¢ Departures 137,039  121,580  120,525  Block hours 327,440  288,407  285,453  Average stage length (miles) 887  887  882  Average number of operating aircraft during period 124.8  124.7  125.2  Average block hours per aircraft per day 7.2  6.3  6.2  Full-time equivalent employees at end of period 5,616  5,991  5,643  Fuel gallons consumed (thousands) 251,049  227,345  224,996  ASMs per gallon of fuel 85.1  83.5  83.4  Average fuel cost per gallon $ 2.55  $ 2.76  $ 3.09  Scheduled service statistics: Passengers 18,518,653  16,765,283  17,143,870  Revenue passenger miles (RPMs) (thousands) 16,947,654  15,303,737  15,639,329  Available seat miles (ASMs) (thousands) 20,679,905  18,314,867  18,208,820  Load factor 82.0  % 83.6  % 85.9  % Departures 131,668  116,441  116,044  Block hours 316,137  277,626  276,313  Average seats per departure 175.4  176.0  176.3  Yield (cents)(1) 6.22  ¢ 7.11  ¢ 7.59  ¢ Total passenger revenue per ASM (TRASM) (cents)(2) 11.93  ¢ 12.88  ¢ 13.38  ¢ Average fare - scheduled service(3) $ 56.89  $ 64.89  $ 69.25  Average fare - air-related charges(3) $ 68.62  $ 67.35  $ 66.33  Average fare - third party products $ 7.73  $ 8.48  $ 6.57  Average fare - total $ 133.25  $ 140.72  $ 142.15  Average stage length (miles) 893  893  888  Fuel gallons consumed (thousands) 242,673  219,061  218,129  Average fuel cost per gallon $ 2.54  $ 2.76  $ 3.09  Percent of sales through website during period 92.3  % 93.6  % 95.8  % Other Data: Rental car days sold 1,347,975  1,306,775  1,377,710  Hotel room nights sold 122,780  196,605  249,933  (1)Defined as scheduled service revenue divided by revenue passenger miles (2)Various components of this measure do not have a direct correlation to ASMs. These figures are provided on a per ASM basis so as to facilitate comparisons with airlines reporting revenues on a per ASM basis. (3)Reflects division of passenger revenue between scheduled service and air-related charges in our booking path. The following terms used in this section and elsewhere in this annual report have the meanings indicated below: “Available seat miles” or “ASMs” represents the number of seats available for passengers multiplied by the number of miles the seats are flown. “Average fuel cost per gallon” represents total aircraft fuel expense for our total system or scheduled service (as applicable) divided by the total number of fuel gallons consumed in our total system or scheduled service. 47 “Average stage length” represents the average number of miles flown per flight.  “Block hours” represents the number of hours during which the aircraft is in revenue service, measured from the time of gate departure until the time of gate arrival at the destination. “Load factor” represents the percentage of aircraft seating capacity utilized (revenue passenger miles divided by available seat miles). “Airline operating expense per ASM” or “CASM” represents airline only operating expenses excluding Sunseeker divided by total system available seat miles. “Airline operating CASM, excluding fuel and special charges” represents airline only operating expenses excluding Sunseeker, less aircraft fuel expense and special charges, divided by total system available seat miles. This statistic provides management and investors the ability to measure and monitor our airline cost performance absent fuel price volatility. Both the cost and availability of fuel are subject to many economic and political factors and therefore are beyond our control. “Passengers” represents the total number of passengers flown on all flight segments. “Revenue passenger miles” or “RPMs” represents the number of miles flown by revenue passengers. “Total passenger revenue per ASM” or “TRASM” represents total passenger revenue divided by scheduled service available seat miles. 48 LIQUIDITY AND CAPITAL RESOURCES Current liquidity Cash, cash equivalents and investment securities (short-term and long-term) increased to $838.5 million at December 31, 2025, from $832.9 million at December 31, 2024. Investment securities represent highly liquid marketable securities which are available-for-sale. As of December 31, 2025, we had $250.0 million of undrawn capacity under revolving credit facilities, plus another $25.1 million of undrawn capacity under a PDP financing facility. Restricted cash represents escrowed funds under fixed fee contracts and cash collateral against letters of credit required by hotel properties for guaranteed room availability, airports and certain other parties. Under our fixed fee flying contracts, we require our customers to prepay for flights to be provided by us. The prepayments are escrowed until the flight is completed and are recorded as restricted cash with a corresponding amount reflected as air traffic liability. Our operating cash flows and long-term debt borrowing have allowed us to invest in our fleet renewal. Future capital needs are primarily for the acquisition of additional aircraft, including our existing aircraft commitments, and for the proposed acquisition of Sun Country and related expenditures. Our share repurchase authority at December 31, 2025 is $64.7 million. During the first quarter of 2025, we made $11.0 million of open market share repurchases. We did not repurchase any shares on the open market during the second, third, or fourth quarters of 2025. We have indefinitely suspended our quarterly cash dividend in anticipation of upcoming capital needs related to our fleet investments. We believe we have more than adequate liquidity resources through our cash, cash equivalents and short term investment balances, financing commitments, our undrawn capacity under existing credit facilities, operating cash flows and anticipated access to liquidity, to meet our current contractual obligations and remain in compliance with the debt covenants in our existing financing agreements for the next 12 months. We will continue to consider raising funds through debt financing as needed to fund capital expenditures. Debt Our debt and finance lease obligations balance, without reduction for related issuance costs, decreased from $2.08 billion as of December 31, 2024 to $1.82 billion as of December 31, 2025. During 2025, we borrowed $638.9 million of which $589.0 million was secured by aircraft and aircraft related assets. Additionally, we made principal payments (scheduled principal payments and prepayments) totaling $906.3 million, including $390.2 million of the principal amount of facilities secured by aircraft and aircraft-related assets, $147.0 million of the principal amount of our Senior Secured Notes, a $100.0 million prepayment of the remaining principal balance of our Sunseeker construction loan, and $263.1 million related to our unsecured debt and PDP financing. As of December 31, 2025, approximately 58.8 percent of our debt and finance lease obligations are fixed-rate. Sources and Uses of Cash Operating Activities. During 2025, we generated cash flows from operations of $389.8 million, compared to $338.5 million during 2024. Our operating cash flows are impacted by the following factors: Advance Ticket Sales. Tickets for air travel are typically purchased in advance of the travel date. When we receive a cash payment at the time of booking, we record the cash received as deferred revenue in air traffic liability. When the flight is flown, we recognize the liability from air traffic liability into revenue. Due to the seasonal nature of our operations, our air traffic liability balances will fluctuate in line with our peak flying seasons. Salaries and Benefits. Salaries and benefits expense represents our single largest expense and has increased considerably in recent years. Cash payments for our salaries and benefits expense are typically made in the period that they are incurred with the exception of our pilot retention bonus, which will be paid to all pilots after ratification of a new collective bargaining agreement. At December 31, 2025 and 2024, we have recorded a liability of $235.9 million and $146.1 million, respectively, in relation to the pilot retention bonus, including related payroll taxes. Fuel. Fuel expense is our second largest expense. The market price for jet fuel is volatile, which can impact the comparability of our periodic cash flows from operations. During 2025, we increased our year over year flying capacity by 12.6 percent, which led to a 10.4 percent increase in fuel gallons consumed and a $12.0 million increase in fuel expense. This increase was partially offset by a 7.6 percent decrease in average fuel cost per gallon. 49 Investing Activities. Investments. We hold various financial assets and will strategically purchase and sell these assets based on operational cash needs. During 2025, we had $105.2 million of net investment purchases (net cash outflows) compared to $196.5 million of net investment maturities (net cash inflows) during 2024. Capital Expenditures. Capital expenditures for 2025 and 2024 (including aircraft pre-delivery deposits) were $387.6 million and $335.2 million, respectively. In December 2021, we committed to purchase 50 Boeing 737 MAX aircraft, of which we began to receive delivery in September 2024. During 2025, we took delivery of 12 aircraft, and as of December 31, 2025, we have firm commitments to purchase 34 more aircraft. Proceeds from Sale of Assets. During 2025, we received $266.7 million in proceeds from the sale of assets, which included $189.9 million from the sale of Sunseeker Resort, which was completed on September 4, 2025. During 2024, proceeds from the sale of assets totaled $86.2 million. Financing Activities. Long-Term Debt and Finance Leases. During 2025 and 2024, we received proceeds of $638.9 million and $387.0 million, respectively, from issuances of new debt, driven by our aircraft acquisition activity. In the same periods, we made principal payments (scheduled principal payments and prepayments) totaling $906.3 million and $585.5 million, respectively, on long term debt and finance lease obligations. We had heightened debt repayment activity in 2025 due to the prepayment of the Sunseeker construction loan, refinancing of our pre-delivery deposit loans upon aircraft delivery, redemptions and repurchases (prepayments) of a portion of our 2027 Senior Secured Notes, and prepayments of other aircraft secured debt. 50 OFF-BALANCE SHEET ARRANGEMENTS, COMMITMENTS AND CONTRACTUAL OBLIGATIONS The following table discloses aggregate information about our contractual cash obligations and off-balance sheet arrangements as of December 31, 2025 and the periods in which payments are due: Contractual obligations (in thousands) Less than 1 year 2-3 years 4-5 years More than 5 years Total Long-term debt obligations(1) $ 182,976  $ 767,736  $ 284,421  $ 588,923  $ 1,824,056  Finance lease obligations 51,108  117,016  209,629  126,539  504,292  Operating lease obligations 14,143  22,430  20,399  25,176  82,148  Aircraft acquisition obligations(2) 632,159  671,167  —  —  1,303,326  Total future payments under contractual obligations $ 880,386  $ 1,578,349  $ 514,449  $ 740,638  $ 3,713,822  (1)Long-term debt obligations (including variable interest entities) include scheduled interest payments, using applicable reference rates as of December 31, 2025, and excluding debt issuance costs. (2)Includes aircraft and engine acquisition obligations under existing purchase agreements based on our current expectations of aircraft deliveries (which differs from the contractual provisions). These amounts are not reflected on our balance sheet. 51 CRITICAL ACCOUNTING POLICIES AND ESTIMATES The discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amount of assets and liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities at the date of our financial statements based on events and transactions occurring during the periods reported. Note 2 to our Consolidated Financial Statements provides a detailed discussion of our significant accounting policies. Critical accounting policies are defined as those policies that reflect significant judgments about matters that are inherently uncertain. Our actual results may differ from these estimates under different assumptions or conditions. We believe our critical accounting policies are limited to those described below.  Allways Rewards® Credit Card Program Under the Allegiant co-brand credit card arrangement, points are sold and consideration is received under an agreement which expires in 2031. Under this arrangement, we identified the following deliverables: travel points to be awarded (the travel component), use of our brand and access to our member lists, and certain other advertising and marketing elements (collectively the marketing component). Each of these deliverables is accounted for separately and allocation of the consideration from the agreement is determined based on the relative selling price of each deliverable. We applied a level of management judgment and estimation in determining the best estimate of selling price for each deliverable by considering multiple inputs and methods including, but not limited to, the redemption value of points awarded, discounted cash flows, brand value, volume discounts, published selling prices, number of points to be awarded and number of points expected to be redeemed. Revenue from the travel component is deferred based on its relative selling price and is recognized into revenue when the points are redeemed by cardholders and the related service is provided. Revenue from the marketing component is considered earned in the period in which points are sold and is therefore recognized into third party products revenue in the same period. Accounting for Long-Lived Assets We record impairment losses on long-lived assets used in operations, consisting principally of property and equipment, when events or changes in circumstances indicate, in management’s judgment, that the assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than the carrying amount of those assets. In making these determinations, we exercise judgment in making certain assumptions, including, but not limited to: (i) estimated fair value of the assets; and (ii) estimated future cash flows expected to be generated by those assets which are based on additional assumptions such as (but not limited to) the overall effect of trends in the airline and hospitality industries and the economy, asset utilization, average fare, block hours, fuel costs, fixed fee contracts, average daily rates, occupancy, cost of goods sold, group bookings, reserve for capital replacement, length of service the asset will be used in operations, and estimated salvage values. In estimating the useful lives and residual values of our aircraft, we have primarily relied upon actual experience with the same or similar aircraft types, current and projected future market information, and input from other industry sources. Subsequent revisions to these estimates could be caused by changing market prices of our aircraft, changes in utilization of the aircraft, and other fleet events. We classify assets as held for sale when the asset or asset group meets all of the accounting requirements to be classified as held for sale. Assets held for sale and any related liabilities are presented as single asset and liability amounts on the balance sheet with a valuation allowance, if necessary, to reduce the carrying amount of the net assets to the lower of carrying amount or estimated fair value less cost to sell. Estimates are required to determine the fair value and the related disposal costs. The estimated fair value is generally based on solicited offers or a discounted cash flow model. During second quarter 2025, we determined that Sunseeker Resort met all of the held for sale accounting criteria. In estimating the fair value of Sunseeker Resort, we relied on an agreed-upon transaction price as the best indicator of the Resort's fair value. The sale of the Resort was completed on September 4, 2025. 52 RECENT ACCOUNTING PRONOUNCEMENTS See related disclosure in Note 2 to our Consolidated Financial Statements. 53