Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q

☑QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
þQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2017March 31, 2024
or
oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to__________
Commission file numberFile Number: 000-49728
jetblue-logoa34.jpgjetbluelogoa15.jpg
JETBLUE AIRWAYS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware87-0617894
Delaware87-0617894
(State or other jurisdiction of Other Jurisdiction of Incorporation)incorporation or organization)(I.R.S. Employer Identification No.)
27-01 Queens Plaza NorthLong Island CityNew York11101
(Address of principal executive offices)  (Zip Code)
(718) 286-7900
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
N/A
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, $0.01 par valueJBLUThe NASDAQ Stock Market LLC
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. þ☑ Yes o☐ No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). þ☑ Yes o☐ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large"large accelerated filer,” “accelerated" "accelerated filer,” “smaller" "smaller reporting company,”" and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filerþ
☑
Accelerated filero☐
Non-accelerated filero (Do not check if a smaller reporting company)
☐
Smaller reporting companyo☐
Emerging growth companyo☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o ☐     No þ☑
As of September 30, 2017,March 31, 2024, there were 320,646,948340,135,050 shares outstanding of the registrant’s common stock, par value $.01.
$0.01.


Table of Contents


JETBLUE AIRWAYS CORPORATION
FORM 10-Q
INDEX
Page
Forward-Looking Information
3
Page
Item 1. Financial Statements
35
Condensed Consolidated Balance Sheets - September 30, 2017March 31, 2024 and December 31, 20162023
35
Consolidated Statements of Operations - Three and Nine Months Ended September 30, 2017March 31, 2024 and 2016.2023
57
Consolidated Statements of Comprehensive IncomeLoss - Three and Nine Months Ended September 30, 2017March 31, 2024 and 2016.2023
68
Condensed Consolidated Statements of Cash Flows - NineThree Months Ended September 30, 2017March 31, 2024 and 2016.2023
79
Consolidated Statements of Stockholders' Equity - Three Months Ended March 31, 2024 and 2023
10
Notes to Condensed Consolidated Financial Statements
811
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
1723
Item 3. Quantitative and Qualitative Disclosures About Market Risk
2636
Item 4. Controls and Procedures
2736
Item 1. Legal Proceedings
2737
Item 1A. Risk Factors
2737
Item 2. Unregistered Sales of Equity Securities, and Use of Proceeds, and Issuer Purchases of Equity Securities
2737
Item 5. Other Information
37
Item 6. Exhibits
2838
39















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Forward-Looking Information
This Quarterly Report on Form 10-Q (the "Report") contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements other than statements of historical facts contained in this Report are forward-looking statements.In some cases, you can identify forward-looking statements by terms such as "expects," "plans," "intends," "anticipates," "indicates," "remains," "believes," "estimates," "forecast," "guidance," "outlook," "may," "will," "should," "seeks," "goals," "targets" or the negative of these terms or other similar expressions.Additionally, forward-looking statements include statements that do not relate solely to historical facts, such as statements which identify uncertainties or trends, discuss the possible future effects of current known trends or uncertainties, or which indicate that the future effects of known trends or uncertainties cannot be predicted, guaranteed, or assured.Forward-looking statements contained in this Report include, without limitation, statements regarding our outlook and future results of operations and financial position, our business strategy and plans for future operations, our sustainability initiatives, the impact of industry or other macroeconomic trends affecting our business, seasonality, and our expectations regarding the wind-down of our Northeast Alliance with American Airlines Group Inc. (the "NEA") and the related impact on our business, financial condition and results of operations. Forward-looking statements involve risks, uncertainties and assumptions, and are based on information currently available to us.Actual results may differ materially from those expressed in the forward-looking statements due to many factors, including, without limitation, the risk associated with the execution of our strategic operating plans in the near-term and long-term; our extremely competitive industry; risks related to the long-term nature of our fleet order book; volatility in fuel prices and availability of fuel; increased maintenance costs associated with fleet age; costs associated with salaries, wages and benefits; risks associated with a potential material reduction in the rate of interchange reimbursement fees; risks associated with doing business internationally; our reliance on high daily aircraft utilization; our dependence on the New York metropolitan market; risks associated with extended interruptions or disruptions in service at our focus cities; risks associated with airport expenses; risks associated with seasonality and weather; our reliance on a limited number of suppliers for our aircraft, engines, and our Fly-Fi® product; risks related to new or increased tariffs imposed on commercial aircraft and related parts imported from outside the United States; the outcome of legal proceedings with respect to the NEA and our wind-down of the NEA; risks associated with cybersecurity and privacy, including information security breaches; heightened regulatory requirements concerning data security compliance; risks associated with reliance on, and potential failure of, automated systems to operate our business; our inability to attract and retain qualified crewmembers; our being subject to potential unionization, work stoppages, slowdowns or increased labor costs; reputational and business risk from an accident or incident involving our aircraft; risks associated with damage to our reputation and the JetBlue brand name; our significant amount of fixed obligations and the ability to service such obligations; our substantial indebtedness and impact on our ability to meet future financing needs; financial risks associated with credit card processors; risks associated with seeking short-term additional financing liquidity; failure to realize the full value of intangible or long-lived assets, causing us to record impairments; risks associated with disease outbreaks or environmental disasters affecting travel behavior; compliance with environmental laws and regulations, which may cause us to incur substantial costs; the impacts of federal budget constraints or federally imposed furloughs; impact of global climate change and legal, regulatory or market response to such change; increasing attention to, and evolving expectations regarding, environmental, social and governance matters; changes in government regulations in our industry; acts of war or terrorism; and changes in global economic conditions or an economic downturn leading to a continuing or accelerated decrease in demand for air travel. It is routine for our internal projections and expectations to change as the year or each quarter in the year progresses, and therefore it should be clearly understood that the internal projections, beliefs, and assumptions upon which we base our expectations may change prior to the end of each quarter or year.
Given the risks and uncertainties surrounding forward-looking statements, you should not place undue reliance on these statements. You should understand that many important factors, in addition to those discussed or incorporated by reference in this Report, could cause our results to differ materially from those expressed in the forward-looking statements. Further information concerning these and other factors is contained in JetBlue's filings with the U.S. Securities and Exchange Commission (the "SEC"), including but not limited to in our Annual Report on Form 10-K for the year ended December 31, 2023 (the "2023 Form 10-K"). In light of these risks and uncertainties, the forward-looking events discussed in this Report might not occur. Our forward-looking statements speak only as of the date of this Report. Other than as required by law, we undertake no obligation to update or revise forward-looking statements, whether as a result of new information, future events, or otherwise.



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Where You Can Find Other Information
Our website is www.jetblue.com. Information contained on our website is not part of this Report. Information we furnish or file with the SEC, including our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to or exhibits included in these reports are available for download, free of charge, on our website soon after such reports are filed with or furnished to the SEC. Our SEC filings, including exhibits filed therewith, are also available at the SEC’s website at www.sec.gov.


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PART 1.I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

JETBLUE AIRWAYS CORPORATION
CONSOLIDATED BALANCE SHEETS
(in millions, except per share data)
JETBLUE AIRWAYS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in millions, except per share data)
 September 30, 2017 December 31, 2016
ASSETS   
CURRENT ASSETS   
Cash and cash equivalents$394
 $433
Investment securities420
 538
Receivables, less allowance (2017-$1; 2016-$5)186
 172
Prepaid expenses and other323
 260
Total current assets1,323
 1,403
PROPERTY AND EQUIPMENT   
Flight equipment8,569
 7,868
Predelivery deposits for flight equipment230
 223
Total flight equipment and predelivery deposits, gross8,799
 8,091
Less accumulated depreciation2,047
 1,823
Total flight equipment and predelivery deposits, net6,752
 6,268
Other property and equipment1,017
 972
Less accumulated depreciation387
 345
Total other property and equipment, net630
 627
Assets constructed for others561
 561
Less accumulated depreciation201
 185
Total assets constructed for others, net360
 376
Total property and equipment7,742
 7,271
OTHER ASSETS   
Investment securities—
 90
Restricted cash60
 62
Other471
 497
Total other assets531
 649
TOTAL ASSETS$9,596
 $9,323
    
 



March 31, 2024December 31, 2023
(unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents$1,237 $1,166 
Investment securities326 401 
Receivables, less allowance (2024 - $4; 2023 - $3)362 336 
Inventories, less allowance (2024 - $37; 2023 - $35)111 109 
Prepaid expenses and other128 148 
Total current assets2,164 2,160 
PROPERTY AND EQUIPMENT 
Flight equipment13,050 12,796 
Pre-delivery deposits for flight equipment389 393 
Total flight equipment and pre-delivery deposits, gross13,439 13,189 
Less accumulated depreciation3,974 4,021 
Total flight equipment and pre-delivery deposits, net9,465 9,168 
Other property and equipment, gross1,300 1,310 
Less accumulated depreciation821 803 
Total other property and equipment, net479 507 
Total property and equipment, net9,944 9,675 
OPERATING LEASE ASSETS571 593 
OTHER ASSETS 
Investment securities145 163 
Restricted cash156 151 
Intangible assets, net of accumulated amortization (2024 - $534; 2023 - $518)383 349 
Other358 762 
Total other assets1,042 1,425 
TOTAL ASSETS$13,721 $13,853 
See accompanying notes to condensed consolidated financial statements.

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED BALANCE SHEETS
(in millions, except per share data)

March 31, 2024December 31, 2023
(unaudited)
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable$647 $641 
Air traffic liability1,723 1,463 
Accrued salaries, wages and benefits597 591 
Other accrued liabilities613 509 
Current operating lease liabilities112 117 
Current maturities of long-term debt and finance lease obligations330 307 
Total current liabilities4,022 3,628 
LONG-TERM DEBT AND FINANCE LEASE OBLIGATIONS4,682 4,409 
LONG-TERM OPERATING LEASE LIABILITIES528 547 
DEFERRED TAXES AND OTHER LIABILITIES  
Deferred income taxes689 743 
Air traffic liability - non-current743 740 
Other424 449 
Total deferred taxes and other liabilities1,856 1,932 
COMMITMENTS AND CONTINGENCIES (Note 6)
STOCKHOLDERS’ EQUITY  
Preferred stock, $0.01 par value; 25 shares authorized, none issued— — 
Common stock, $0.01 par value; 900 shares authorized, 500 and 499 shares issued and 340 and 339 shares outstanding at March 31, 2024 and December 31, 2023, respectively5 5 
Treasury stock, at cost; 160 and 159 shares at March 31, 2024 and December 31, 2023, respectively(2,002)(1,999)
Additional paid-in capital3,233 3,221 
Retained earnings1,398 2,114 
Accumulated other comprehensive loss(1)(4)
Total stockholders’ equity2,633 3,337 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$13,721 $13,853 

JETBLUE AIRWAYS CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited, in millions, except per share data)
 September 30, 2017 December 31, 2016
LIABILITIES AND STOCKHOLDERS’ EQUITY   
CURRENT LIABILITIES   
Accounts payable$295
 $242
Air traffic liability1,262
 1,120
Accrued salaries, wages and benefits288
 342
Other accrued liabilities282
 321
Current maturities of long-term debt and capital leases224
 189
Total current liabilities2,351
 2,214
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS1,031
 1,195
CONSTRUCTION OBLIGATION445
 457
DEFERRED TAXES AND OTHER LIABILITIES   
Deferred income taxes1,555
 1,354
Other75
 90
Total deferred taxes and other liabilities1,630
 1,444
STOCKHOLDERS’ EQUITY   
Preferred stock, $0.01 par value; 25 shares authorized, none issued—
 —
Common stock, $0.01 par value; 900 shares authorized, 417 and 414 shares issued and 321 and 337 shares outstanding at September 30, 2017 and December 31, 2016, respectively4
 4
Treasury stock, at cost; 96 and 77 shares at September 30, 2017 and December 31, 2016, respectively(890) (500)
Additional paid-in capital2,100
 2,050
Retained earnings2,921
 2,446
Accumulated other comprehensive income4
 13
Total stockholders’ equity4,139
 4,013
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$9,596
 $9,323




See accompanying notes to condensed consolidated financial statements.

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in millions, except per share amounts)data)




Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Three Months Ended March 31,
Three Months Ended March 31,
Three Months Ended March 31,
2024
2024
2024
OPERATING REVENUES
OPERATING REVENUES
OPERATING REVENUES       
Passenger$1,623
 $1,571
 $4,724
 $4,536
Passenger
Passenger
Other
Other
Other190
 161
 535
 455
Total operating revenues1,813
 1,732
 5,259
 4,991
Total operating revenues
Total operating revenues
OPERATING EXPENSES       
Aircraft fuel and related taxes347
 293
 994
 782
OPERATING EXPENSES
OPERATING EXPENSES
Aircraft fuel
Aircraft fuel
Aircraft fuel
Salaries, wages and benefits
Salaries, wages and benefits
Salaries, wages and benefits466
 421
 1,397
 1,270
Landing fees and other rents104
 98
 301
 276
Landing fees and other rents
Landing fees and other rents
Depreciation and amortization
Depreciation and amortization
Depreciation and amortization114
 102
 328
 289
Aircraft rent26
 28
 75
 84
Aircraft rent
Aircraft rent
Sales and marketing68
 60
 195
 197
Maintenance materials and repairs149
 153
 467
 427
Sales and marketing
Sales and marketing
Maintenance, materials and repairs
Maintenance, materials and repairs
Maintenance, materials and repairs
Special items
Special items
Special items
Other operating expenses
Other operating expenses
Other operating expenses229
 223
 691
 650
Total operating expenses1,503
 1,378
 4,448
 3,975
OPERATING INCOME310
 354
 811
 1,016
Total operating expenses
Total operating expenses
OPERATING LOSS
OPERATING LOSS
OPERATING LOSS
OTHER INCOME (EXPENSE)
OTHER INCOME (EXPENSE)
OTHER INCOME (EXPENSE)       
Interest expense(23) (28) (72) (85)
Interest expense
Interest expense
Interest income
Interest income
Interest income
Capitalized interest3
 2
 7
 6
Interest income and other3
 2
 5
 5
Total other income (expense)(17) (24) (60) (74)
INCOME BEFORE TAXES293
 330
 751
 942
Income tax expense114
 131
 276
 355
NET INCOME$179
 $199
 $475
 $587
Capitalized interest
Capitalized interest
Gain (loss) on investments, net
Gain (loss) on investments, net
Gain (loss) on investments, net
Other
Other
Other
Total other expense
Total other expense
Total other expense
LOSS BEFORE INCOME TAXES
LOSS BEFORE INCOME TAXES
LOSS BEFORE INCOME TAXES
Income tax benefit
Income tax benefit
Income tax benefit
NET LOSS
NET LOSS
NET LOSS
       
EARNINGS PER COMMON SHARE:       
LOSS PER COMMON SHARE
LOSS PER COMMON SHARE
LOSS PER COMMON SHARE
Basic
Basic
Basic$0.55
 $0.61
 $1.44
 $1.81
Diluted$0.55
 $0.58
 $1.43
 $1.72
Diluted
Diluted





See accompanying notes to condensed consolidated financial statements.

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PART I. FINANCIAL INFORMATION


ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOMELOSS
(unaudited, in millions)
Three Months Ended March 31,
20242023
NET LOSS$(716)$(192)
Changes in fair value of available-for-sale securities and derivative instruments, net of reclassifications into earnings, net of taxes of $0 and $(1) in 2024 and 2023, respectively.3 (5)
Total other comprehensive income (loss)3 (5)
COMPREHENSIVE LOSS$(713)$(197)

 Three Months Ended September 30,
 2017 2016
NET INCOME$179
 $199
Changes in fair value of derivative instruments, net of reclassifications into earnings (net of $1 and $(4) of taxes in 2017 and 2016, respectively)4
 (6)
Total other comprehensive income4
 (6)
COMPREHENSIVE INCOME$183
 $193

 Nine Months Ended September 30,
 2017 2016
NET INCOME$475
 $587
Changes in fair value of derivative instruments, net of reclassifications into earnings (net of $(7) and $8 of taxes in 2017 and 2016, respectively)(9) 13
Total other comprehensive income(9) 13
COMPREHENSIVE INCOME$466
 $600


See accompanying notes to condensed consolidated financial statements.

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in millions)

Three Months Ended March 31,
20242023
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss$(716)$(192)
Adjustments to reconcile net loss to net cash provided by operating activities:
Deferred income taxes(54)(78)
Depreciation and amortization158 151 
Spirit special items, non cash450 — 
Stock-based compensation12 10 
Changes in certain operating assets and liabilities331 520 
Other, net23 (6)
Net cash provided by operating activities204 405 
CASH FLOWS FROM INVESTING ACTIVITIES 
Capital expenditures(427)(172)
Pre-delivery deposits for flight equipment(39)— 
Purchase of held-to-maturity investments— (4)
Proceeds from the maturities of held-to-maturity investments19 4 
Purchase of available-for-sale securities(1)(102)
Proceeds from the sale of available-for-sale securities75 267 
Payment for Spirit Airlines acquisition(22)(33)
Other, net(4)— 
Net cash used in investing activities(399)(40)
CASH FLOWS FROM FINANCING ACTIVITIES 
Proceeds from sale-leaseback transactions332 38 
Repayment of long-term debt and finance lease obligations(58)(109)
Acquisition of treasury stock(3)(3)
Net cash provided by (used in) financing activities271 (74)
INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH76 291 
Cash, cash equivalents and restricted cash at beginning of period1,317 1,188 
Cash, cash equivalents and restricted cash at end of period (1)
$1,393 $1,479 
SUPPLEMENTAL CASH FLOW INFORMATION
Cash payments for interest$(24)$(6)
Cash payments for income taxes, net(6)— 
NON-CASH TRANSACTIONS
Operating lease assets acquired under operating leases$6 $4 
Flight equipment acquired under finance leases20 — 
(1) Reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets.
March 31, 2024March 31, 2023
Cash and cash equivalents$1,237 $1,333 
Restricted cash (2)
156 146 
Total cash, cash equivalents and restricted cash$1,393 $1,479 
(2) Restricted cash primarily consists of funds held in escrow for estimated workers' compensation obligations and other letters of credit.
JETBLUE AIRWAYS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in millions)
 Nine Months Ended September 30,
 2017 2016
CASH FLOWS FROM OPERATING ACTIVITIES   
Net income$475
 $587
Adjustments to reconcile net income to net cash provided by operating activities:   
Deferred income taxes207
 204
Depreciation283
 248
Amortization45
 41
Stock-based compensation22
 18
Gains on sale of assets and debt extinguishment—
 (4)
Changes in certain operating assets and liabilities58
 235
Other, net(24) (12)
Net cash provided by operating activities1,066
 1,317
CASH FLOWS FROM INVESTING ACTIVITIES   
Capital expenditures(705) (480)
Predelivery deposits for flight equipment(90) (118)
Purchase of held-to-maturity investments(92) (151)
Proceeds from the maturities of held-to-maturity investments128
 282
Purchase of available-for-sale securities(223) (507)
Proceeds from the sale of available-for-sale securities395
 345
Other, net(6) (1)
Net cash used in investing activities(593) (630)
CASH FLOWS FROM FINANCING ACTIVITIES   
Proceeds from issuance of common stock28
 26
Repayment of long-term debt and capital lease obligations(138) (148)
Acquisition of treasury stock(390) (14)
Other, net(12) 4
Net cash used in financing activities(512) (132)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS(39) 555
Cash and cash equivalents at beginning of period433
 318
Cash and cash equivalents at end of period$394
 $873


See accompanying notes to condensed consolidated financial statements.

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(unaudited, in millions)

Common Stock Issued
Shares Amount		Treasury Stock Shares AmountAdditional
Paid-In
Capital		Retained
Earnings		Accumulated Other Comprehensive Income (Loss)Total
Balance at December 31, 2023499 $5 159 $(1,999)$3,221 $2,114 $(4)$3,337 
Net loss— — — — — (716)— (716)
Other comprehensive income— — — — — — 3 3 
Vesting of restricted stock units1 — 1 (3)— — — (3)
Stock compensation expense— — — — 12 — — 12 
Balance at March 31, 2024500 $5 160 $(2,002)$3,233 $1,398 $(1)$2,633 
Common Stock Issued
Shares Amount		Treasury Stock Shares AmountAdditional
Paid-In
Capital		Retained
Earnings		Accumulated Other Comprehensive LossTotal
Balance at December 31, 2022486 $5 159 $(1,995)$3,129 $2,424 $— $3,563 
Net loss— — — — — (192)— (192)
Other comprehensive loss— — — — — — (5)(5)
Vesting of restricted stock units1 — — (3)— — — (3)
Stock compensation expense— — — — 10 — — 10 
Balance at March 31, 2023487 $5 159 $(1,998)$3,139 $2,232 $(5)$3,373 
See accompanying notes to condensed consolidated financial statements.
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)





Note 1—1 - Summary of Significant Accounting Policies
Basis of Presentation
JetBlue Airways Corporation or JetBlue,("JetBlue") provides air transportation services across the United States, the Caribbean, Latin America, Canada, and Latin America.Europe. Our condensed consolidated financial statements include the accounts of JetBlue and our subsidiaries which are collectively referred to as “we”"we" or the “Company.”"Company." All majority-owned subsidiaries are consolidated on a line by lineline-by-line basis, with all intercompany transactions and balances being eliminated. These condensed consolidated financial statements and related notes should be read in conjunction with our 20162023 audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2016, or our 20162023 (the "2023 Form 10-K.10-K").
These condensed consolidated financial statements are unaudited and have been prepared by us followingin accordance with the rules and regulations of the U.S. Securities and Exchange Commission or the SEC.(the "SEC"). In our opinion, they reflect all adjustments, including normal recurring items, that are necessary to present fairly the results for interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the U.S., or GAAP,United States ("GAAP") have been condensed or omitted as permitted by such rules and regulations; however, we believe that the disclosures included herein are adequate to make the information presented not misleading. Operating results
We have reclassified certain prior periods to conform to the current period presentation. Unless otherwise noted, all amounts disclosed are stated before consideration of income taxes.
Note 2 - Revenue Recognition
The Company categorizes revenue recognized from contracts with its customers by revenue source as we believe it best depicts the nature, amount, timing, and uncertainty of our revenue and cash flow. The following table provides revenue recognized by revenue source for the periodsthree months ended March 31, 2024 and 2023 (in millions):
Three Months Ended March 31,
20242023
Passenger revenue
Passenger travel$1,888 $2,026 
Loyalty revenue - air transportation167 156 
Other revenue
Loyalty revenue107 100 
Other revenue47 46 
Total operating revenue$2,209 $2,328 
TrueBlue® is our customer loyalty program designed to reward and recognize our customers. TrueBlue® points earned from ticket purchases are recorded as a reduction to Passenger travel within passenger revenue. Amounts presented herein are not necessarily indicativein Loyalty revenue - air transportation represent revenue recognized when TrueBlue® points have been redeemed and travel has occurred. Loyalty revenue within other revenue is primarily comprised of the results that may be expected for other interim periods ornon-air transportation elements from the entire fiscal year.
Investment securities
Investment securities consistsale of available-for-sale investment securities and held-to-maturity investment securities. We use a specific identification method to determine the cost of the securities when they are sold.
Held-to-maturity investment securities. The contractual maturities of the corporate bonds we held as of September 30, 2017 were not greater than 24 months. We did not record any significant gains or losses on these securities during the three and nine months ended September 30, 2017 or 2016. The estimated fair value of these investments approximated their carrying value as of September 30, 2017 and December 31, 2016, respectively.
The carrying values of investment securities consisted of the following at September 30, 2017 and December 31, 2016 (in millions):
 September 30, 2017 December 31, 2016
Available-for-sale securities   
Time deposits$150
 $160
Commercial paper10
 60
Debt securities3
 —
Treasury bills—
 115
Total available-for-sale securities163
 335
Held-to-maturity securities   
Treasury notes$205
 $283
Corporate bonds52
 10
Total held-to-maturity securities257
 293
Total investment securities$420
 $628
Recent Accounting Pronouncements
During the first quarter of 2017, we adopted Accounting Standards Update, or ASU, 2015-17, Income Taxes, Balance Sheet Classification of Deferred Taxes topic of the FASB Codification, or Codification. This standard requires all deferred tax assets and liabilities to be classified as non-current on the balance sheet instead of separating deferred taxes into current and non-current amounts. In addition, valuation allowance allocations between current and non-current deferred tax assets are no longer required because those allowances also will be classified as non-current. Our condensed consolidated balance sheet as of December 31, 2016 reflects retrospective application. As a result of the adoption, $9 million of deferred tax liabilities previously included within other accrued liabilities and $164 million of deferred tax assets previously included within current assets have been moved to long-term liabilities on our December 31, 2016 balance sheet.


TrueBlue® points.
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)



Contract Liabilities
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). Under ASU 2016-02, a lessee will recognizeOur contract liabilities primarily consist of ticket sales for lease paymentswhich transportation has not yet been provided, unused credits available to customers, and right-of-use assets representing its right to use the underlying assetoutstanding loyalty points available for the lease term. While we are still evaluating the full impact of adopting the amendmentsredemption (in millions):
March 31, 2024December 31, 2023
Air traffic liability - passenger travel$1,354 $1,099 
Air traffic liability - loyalty program (air transportation)1,076 1,072 
Deferred revenue (1)
472 487 
Total$2,902 $2,658 
(1) Deferred revenue is included within other accrued liabilities and other liabilities on our consolidated financial statementsbalance sheets.
During the three months ended March 31, 2024 and disclosures,2023, we have determined that it will impact our accounting for leased aircraftrecognized passenger revenue of $834 million and other leasing agreements. The amendments are effective for fiscal years beginning after December 15, 2018 and include interim periods within those fiscal years. Early adoption is permitted, and companies are required to use a modified retrospective approach$858 million, respectively, which was included in passenger travel liability at the earliest period presented.
In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230), Restricted Cash. The amendments clarified how entities should present restricted cash and restricted cash equivalents in the statement of cash flows. ASU 2016-18 requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. The amendments are effective for fiscal years beginning after December 15, 2017 and include interim periods within those years. Early adoption is permitted.
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers, which supersedes existing revenue recognition guidance. Under the new standard, a company will recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled to in exchange for those goods or services. The standard allows for either full retrospective or modified retrospective adoption and is effective for interim and annual reporting periods beginning after December 15, 2017.  JetBlue will adopt ASU 2014-09 effective January 1, 2018 and expects to use the full retrospective method.
While we are evaluating the full impact of ASU 2014-09 on our consolidated financial statements, we have determined that the most significant impact of the standard will be on the accounting for our TrueBlue® Loyalty Program. The standard eliminates the incremental cost method for loyalty program accounting which the Company currently uses and will require us to re-value the liability for points earned on qualifying JetBlue purchases using a relative fair value approach. We currently estimate that applying a relative fair value approach would increase air traffic liability by approximately $250 million to $350 million as of the beginning of the retrospective reporting period, depending on various assumptions made atrespective periods.
The Company elected the timepractical expedient that allows entities to not disclose the amount of measurement.the remaining transaction price and its expected timing of recognition for passenger tickets if the contract has an original expected duration of one year or less or if certain other conditions are met. We elected to apply this practical expedient to our contract liabilities relating to passenger travel and ancillary services as our tickets or any related passenger credits expire generally one year from the date of booking.
In addition, we currently have a liability for outstandingTrueBlue® points are combined into one homogeneous pool and are not separately identifiable. As such, the revenue is comprised of points that were earned in conjunction with our previous co-branded credit card agreement. Those points had been recorded using the residual method. The new standard does not permit the usagepart of the residual method for this contractair traffic liability balance at the beginning of the period as well as points that were issued during the period.
The table below presents the activity of the current and instead the transaction price will be allocated to the performance obligations on a relative selling price basis. This change in accounting methodology will decrease the relative value allocated to the transportation performance obligation and will result in a decrease to thenon-current air traffic liability for which we are inour loyalty program, and includes points earned and sold to participating companies for the process of quantifying the impact.three months ended March 31, 2024 and 2023 (in millions):
Currently, passenger revenue from unused tickets or passenger credits is recognized at expiration. Under the new standard, revenue will be recorded in proportion to flown revenue based on estimates of expected expiration.
Balance at December 31, 2023$1,072
TrueBlue® points redeemed passenger
(160)
TrueBlue® points redeemed other
(7)
TrueBlue® points earned and sold
171 
Balance at March 31, 2024$1,076
Balance at December 31, 2022$1,000
TrueBlue® points redeemed passenger
(156)
TrueBlue® points redeemed other
— 
TrueBlue® points earned and sold
154 
Balance at March 31, 2023$998
We also expect this standard to result in a change in theThe timing and classification of our revenue recognition for certain ancillary fees directly related to passenger tickets. We expect that these revenues, which wereTrueBlue® point redemptions can vary; however, the majority of points are redeemed within approximately $425 million for 2016, will be reclassified from other revenue inthree years of the current presentation to passenger revenue after adoption.date of issuance.

Note 2—Long Term3 - Long-term Debt, Short TermShort-term Borrowings and CapitalFinance Lease Obligations
During the ninethree months ended September 30, 2017,March 31, 2024, we made scheduled principal payments of $138$58 million on our outstanding long-term debt and capitalfinance lease obligations.
We haveAt March 31, 2024, we had pledged aircraft, engines, other equipment, and facilities with a net book value of $2.4$6.4 billion at September 30, 2017 as security under various loan agreements. As of September 30, 2017, we owned, free of encumbrance, 74 Airbus A320 aircraft, 36 Airbus A321 aircraft and 37 spare engines. At September 30, 2017, scheduled maturities of all of our long-term debt and capital lease obligations were $55 million for the remainder of 2017, $194 million in 2018, $215 million in 2019, $179 million in 2020, $164 million in 2021 and $448 million thereafter.

financing arrangements.
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)



At March 31, 2024, scheduled maturities of our long-term debt and finance lease obligations were as follows (in millions):
YearTotal
Remainder of 2024$265 
2025302 
20261,044 
2027297 
2028403 
Thereafter2,701 
Total$5,012 
The carrying amounts and estimated fair values of our long-term debt, net of debt acquisition costs, at September 30, 2017March 31, 2024 and December 31, 20162023 were as follows (in millions):
March 31, 2024December 31, 2023
Carrying Value
Estimated Fair Value (1)
Carrying ValueEstimated Fair Value
Public Debt
Fixed rate special facility bonds, due through 2036$42 $43 $42 $43 
Fixed rate enhanced equipment notes:
  2019-1 Series AA, due through 2032477 483 476 474 
  2019-1 Series A, due through 2028149 151 149 150 
2019-1 Series B, due through 202770 86 70 86 
2020-1 Series A, due through 2032506 606 506 597 
2020-1 Series B, due through 2028117 150 117 150 
Non-Public Debt
Fixed rate equipment notes, due through 2028290 278 322 305 
Floating rate equipment notes, due through 2030 (2)
101 106 109 113 
Aircraft sale-leaseback transactions, due through 20361,962 2,121 1,648 1,738 
Unsecured CARES Act Payroll Support Program loan, due through 2030259 190 259 184 
Unsecured Consolidated Appropriations Act Payroll Support Program Extension loan, due through 2031144 104 144 101 
Unsecured American Rescue Plan Act of 2021 Payroll Support loan, due through 2031132 96 132 93 
0.50% convertible senior notes due through 2026743 671 742 657 
Total (3)
$4,992 $5,085 $4,716 $4,691 
 September 30, 2017 December 31, 2016
 Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value
Public Debt       
Fixed rate special facility bonds, due through 2036$42
 $45
 $42
 $45
Non-Public Debt       
Fixed rate enhanced equipment notes, due through 2023169
 178
 188
 197
Floating rate equipment notes, due through 2025157
 163
 171
 179
Fixed rate equipment notes, due through 2026761
 824
 843
 915
Total(1)
$1,129
 $1,210
 $1,244
 $1,336
(1) Total excludes capital lease obligations of $126 million for September 30, 2017 and $140 million for December 31, 2016
The estimated fair valuesvalues of our publicly held long-term debt are classified as Level 2 in the fair value hierarchy. The fair values of our enhanced equipment notes and our special facility bonds were based on quoted market prices in markets with low trading volumes. The fair value of our non-public debt wasare estimated using a discounted cash flow analysis based on our borrowing rates for instruments with similar terms and therefore classified as Level 3 in the fair value hierarchy. The fair values of our other financial instruments approximate their carrying values. Refer to Note 7 for an explanation of the fair value hierarchy structure.
(2) Floating rate debt is equal to Secured Overnight Financing Rate ("SOFR"), plus a margin.
(3) Total excludes finance lease obligations of $20 million at March 31, 2024 and an immaterial amount at December 31, 2023.

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

We have financed certain aircraft with Enhanced Equipment Trust Certificates or EETC, as one("EETCs"). One of the benefits of this structure is being able to finance several aircraft at one time, rather than individually. The structure of EETC financing is that we create pass-through trusts in order to issue pass-through certificates. The proceeds from the issuance of these certificates are then used to purchase equipment notes which are issued by us and are secured by our aircraft. These trusts meet the definition of a variable interest entity or VIE,("VIE"), as defined in the Consolidations topicTopic 810, Consolidation of the Financial Accounting Standards Board ("FASB") Codification, and must be considered for consolidation in our condensed consolidated financial statements. Our assessment of our EETCs considers both quantitative and qualitative factors including the purpose for which these trusts were established and the nature of the risks in each. The main purpose of the trust structure is to enhance the credit worthinesscreditworthiness of our debt obligation through certain bankruptcy protection provisions and liquidity facilities, and also to lower our total borrowing cost. We concluded that we are not the primary beneficiary in these trusts because our involvement in them is limited to principal and interest payments on the related notes, the trusts were not set up to pass along variability created by credit risk to us, and the likelihood of our defaulting on the notes. Therefore, we have not consolidated these trusts in our financial statements.
2024 Sale-Leaseback Transactions
During the three months ended March 31, 2024, we entered into $332 million of sale-leaseback transactions. These transactions did not qualify as sales for accounting purposes. The assets associated with these transactions remain on our consolidated balance sheets within property and equipment and the related liabilities under the lease are classified within debt and finance leases obligations. These transactions are treated as cash from financing activities on our condensed consolidated financial statements.statements of cash flows.
Short-term Borrowings
Citibank Line of Credit
As of September 30, 2017, we had anOn October 21, 2022, JetBlue entered into the $600 million Second Amended and Restated Credit and Guaranty Agreement or the Amended and Restated Facility, with(the "Facility"), among JetBlue, Citibank N.A., as the administrative agent, for up to approximately $425 million. The term ofand the Amended and Restated Facility runs through April 6, 2021.lenders party thereto. Borrowings under the Amended and Restated Facility bear interest at a variable rate equal to LIBOR,based on SOFR, plus a margin and areof 2.00% per annum, or another rate (at JetBlue's election) based on certain market interest rates, plus a margin of 1.00% per annum, in each case with a floor of 0%. The Facility is secured by Slots at John F. Kennedy International Airport, LaGuardia Airportspare parts, aircraft, simulators, and Reagan National Airport as well as certain other assets. Slots are rights to take-off or land at a specific airport during a specific time period during the day and are a means by which airport capacity and congestion can be managed.assets as permitted thereunder. The Amended and Restated Facility includes covenants that require us to maintain certain minimum balances in unrestricted cash, cash equivalents, and unused commitments available under all revolving credit facilities. In addition, the covenants restrict our ability to, among other things, dispose of certain collateral, or merge, consolidate, or sell assets. On October 17, 2023, JetBlue further amended the Facility to, among other things, extend the maturity date to October 21, 2025.
As of and for the periods ended September 30, 2017March 31, 2024 and December 31, 2016,2023, we did not have a balance outstanding or any borrowings under this line of credit.

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JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)


the Facility.
Morgan Stanley Line of Credit
We have a revolving line of credit with Morgan Stanley for up to approximately $200 million. This line of credit is secured by a portion of our investment securities held by Morgan Stanley and the amount available to us under this line of credit may vary accordingly. This line of credit bears interest at a floating rate based upon LIBOR (or such replacement index as the bank shall determine from time to time in accordance with the terms of the agreement), plus a margin. As of and for the periods ended September 30, 2017March 31, 2024 and December 31, 2016,2023, we did not have a balance outstanding or any borrowings under this line of credit.
2022 $3.5 Billion Senior Secured Bridge Facility

Note 3—Earnings Per Share
The following table shows how we computed basic and diluted earnings per common share (in millions):
 Three Months Ended September 30, Nine Months Ended September 30,
 2017 2016 2017 2016
Numerator:       
Net Income(1)
$179
 $199
 $475
 $587
Effect of dilutive securities:       
Interest on convertible debt, net of income taxes and profit sharing—
 1
 —
 2
Net income applicable to common stockholders after assumed conversions for diluted earnings per share$179
 $200
 $475
 $589
        
Denominator:       
Weighted average shares outstanding326.1
 323.7
 330.8
 322.8
Effect of dilutive securities:       
Employee stock options, restricted stock units and stock purchase plan1.7
 1.9
 1.6
 2.2
Convertible debt—
 17.6
 —
 17.6
Adjusted weighted average shares outstanding and assumed conversions for diluted earnings per share327.8
 343.2
 332.4
 342.6
(1) We early adopted ASU 2016-09, Improvements to Employee Share-Based Payment Accounting, during the fourth quarter of 2016. The adoption of this standard resulted in the recognition of $8 million of excess tax benefits to the income tax provision for the year ended December 31, 2016. Net income and shares outstanding data for the three months and nine months ended September 30, 2016 are presented as if the ASU was adopted at the beginning of 2016.
We have no convertible debt outstanding as of September 30, 2017. During the three and nine months ended September 30, 2016, there were no shares excluded from earnings per share upon assumed conversion of our convertible debt.
On March 6, 2017, JetBlue entered into an accelerated share repurchase, or ASR, agreement with Barclays Bank PLC, or Barclays, paying $100 million for an initial delivery of approximately 4.1 million shares. The term of the Barclays ASR concluded on April 24, 2017 with Barclays delivering approximately 0.8 million additional shares to JetBlue on April 27, 2017. A total of 4.9 million shares, at an average price of $20.23 per share, were repurchased under the agreement. The total number of shares repurchased by JetBlue was based on the volume weighted average price of JetBlue's common stock during the term of the Barclays ASR agreement.
On April 27, 2017, JetBlue entered into an ASR agreementa Second Amended and Restated Commitment Letter (the "Commitment Letter"), dated July 28, 2022, with Goldman Sachs & Co.Bank USA; BofA Securities, Inc.; Bank of America, N.A.; BNP Paribas; Credit Suisse AG, New York Branch; Credit Suisse Loan Funding LLC; Credit Agricole Corporate and Investment Bank; Natixis, New York Branch; Sumitomo Mitsui Banking Corporation; and MUFG Bank, Ltd. (collectively, the "Commitment Parties"), pursuant to which the Commitment Parties committed to provide a senior secured bridge facility in an aggregate principal amount of up to $3.5 billion to finance the acquisition of Spirit Airlines, Inc. ("Spirit") under the Agreement and Plan of Merger (the "Merger Agreement"). The Commitment Letter was terminated on March 4, 2024. Prior to its termination, we did not have a balance outstanding or GS&Co., paying $150 millionany borrowings under this facility. Please refer to Note 12 for an initial delivery of approximately 5.4 million shares. The termadditional details on the termination of the GS&Co. ASR concluded on July 24, 2017 with GS&Co. delivering approximately 1.4 million additional shares to JetBlue on July 27, 2017. A total of 6.8 million shares, at an average price of $21.99 per share, were repurchased under the agreement. The total number of shares repurchased by JetBlue was based on the volume weighted average price of JetBlue's common stock during the term of the GS&Co. agreement.

Merger Agreement.
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)



Note 4 - Loss Per Share
On September 11, 2017, JetBlue entered into an ASR agreement with Morgan Stanley & Co. LLC, or Morgan Stanley, paying $130 million for an initial delivery of approximately 5.4 million shares. The term of the Morgan Stanley ASR concluded on September 26, 2017 with Morgan Stanley delivering approximately 1.5 million additional shares to JetBlue on September 28, 2017. A total of 6.9 million shares, at an average price of $18.86Basic loss per share were repurchased underis calculated by dividing net loss by the agreement. The totalweighted average number of shares repurchased by JetBlue was based onoutstanding. Diluted loss per share is calculated similarly but includes potential dilution from restricted stock units, the volume weighted average price of JetBlue'screwmember stock purchase plan, convertible notes, warrants issued under various federal payroll support programs, and any other potentially dilutive instruments using the treasury stock and if-converted method. Anti-dilutive common stock duringequivalents excluded from the termcomputation of diluted loss per share amounts were 3.8 million and 1.6 million for the Morgan Stanley agreement.three months ended March 31, 2024 and March 31, 2023, respectively.
The following table shows how we computed basic and diluted loss per common share for the three months ended March 31, 2024 and 2023 (dollars and share data in millions):

Three Months Ended March 31,
 20242023
Net loss$(716)$(192)
Weighted average basic shares339.7 327.6 
Effect of dilutive securities— — 
Weighted average diluted shares$339.7 327.6 
Loss per common share
Basic$(2.11)$(0.58)
Diluted$(2.11)$(0.58)
Note 4—5 - Crewmember Retirement Plan and Profit Sharing
We sponsor a retirement savings 401(k) defined contribution plan or the Plan,(the "Plan"), covering all of our employees, who we refer to as Crewmembers,U.S. and Puerto Rico crewmembers, where we match 100% of our Crewmembers'eligible crewmember's contributions up to 5% of their eligible wages. TheEmployer contributions vest over 5after three years of service and are measured from a Crewmember'screwmember's hire date. Crewmembers are vested immediately vested in their voluntary contributions.
Another component of the Plan is a Company discretionary contribution of 5% of eligible non-management Crewmember compensation, which we refer to as Retirement Plus. Retirement Plus contributions vest over 3 years and are measured from a Crewmember's hire date.
For years of service prior to 2017, our non-management Crewmembers were also eligible to receive profit sharing, calculated as 15% of adjusted pre-tax income before profit sharing and special items with the result reduced by Retirement Plus contributions. Beginning with 2017, non-management Crewmembers are eligible to receive profit sharing, calculated as 10% of adjusted pre-tax income before profit sharing and special items up to a pre-tax margin of 18%. If JetBlue's resulting pre-tax margin exceeds 18%, non-management Crewmembers will receive 20% profit sharing above an 18% pre-tax margin. The result is reduced by Retirement Plus contributions and Crewmembers may elect to have their profit sharing contributed directly to the Plan.
Certain Federal Aviation Administration or FAA-licensed Crewmembers, receive an additional("FAA") licensed crewmembers received a discretionary contribution of 3% of eligible compensation, which we refer to as Retirement Advantage. As of January 2024, the Retirement Advantage program ended and these licensed Crewmembers now receive a discretionary contribution of 8% of eligible compensation, which we refer to as Retirement Non-elective Licensed Crewmember contributions. System Controllers also receive a Company discretionary contribution of 5% of eligible compensation, referred to as Retirement Non-elective Crewmember contributions.The Company’s non-elective contributions vests after three years of service.
Our Pilots receive a non-elective Company contribution of 16% of eligible compensation per the terms of the finalized collective bargaining agreement between JetBlue and the Air Line Pilots Association ("ALPA"), in lieu of the above 401(k) Company matching contribution, Retirement Non-elective, and Retirement Advantage contributions. The Company's non-elective contribution of eligible Pilot compensation vests after three years of service.
Total 401(k) company match Retirement Plus, profit sharing and Retirement Advantage expensed non-elective crewmember contribution expense was $66 million for each of the three months ended September 30, 2017 March 31, 2024 and 2016 was $49 million and $74 million, respectively, while the total amount expensed for the nine months ended September 30, 2017 and 2016 was $143 million and $221 million, respectively.2023.


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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

Note 5—6 - Commitments and Contingencies
Flight Equipment Commitments
As of September 30, 2017, March 31, 2024, our firm aircraft orders consisted of 25 Airbus A320 new engine option (neo) aircraft, 17 Airbus A321 aircraft, 60 Airbus A321neo aircraft, 24 Embraer 190 aircraft and 10 spare engines scheduled for delivery through 2024. Committedcommitted expenditures for these aircraft and related flight equipment, including estimated amounts for contractual price escalations and predeliverypre-delivery deposits, willis set forth in the table below (in millions):
Flight equipment commitments
YearTotal
Remainder of 2024
$820 
20251,165 
20261,144 
20271,011 
20281,529 
Thereafter1,198 
Total$6,867 
As of March 31, 2024, our firm aircraft orders included the following aircraft:
Flight equipment deliveries (1)
YearAirbus A220Airbus A321neoTotal
Remainder of 202415 4 19 
202520 5 25 
202620 4 24 
20275 9 14 
20287 16 23 
Thereafter4 14 18 
Total (2)
71 52 123 
(1) The aircraft orders stated above represents the current delivery schedule set forth in our Airbus order book as of March 31, 2024.
(2) In addition, we have options to purchase an additional 20 A220-300 aircraft.
Other Commitments and Contingencies
We utilize several credit card processors to process our ticket sales. Our agreements with these processors do not contain covenants, but do generally allow the processor to withhold cash reserves to protect the processor from potential liability for tickets purchased, but not yet used for travel. While we currently do not have any collateral requirements related to our credit card processors, we may be approximately $343 million forrequired to issue collateral to our credit card processors, or other key business partners, in the remainderfuture.
As of 2017, $814March 31, 2024, we had $59 million in 2018, $1.0 billion in 2019, $1.4 billion in 2020, $1.5 billion in 2021 and $2.6 billion thereafter.

Other Commitments
As part of the 2014 sale of LiveTV, LLC, or LiveTV, formerly a wholly owned subsidiary of JetBlue, to Thales Holding Corporation a $3 million liability relating to Airfone, a former subsidiary of LiveTV, was assigned to JetBlue under the purchase agreement with Thales. Separately, prior to the sale of LiveTV, JetBlue had an agreement with ViaSat Inc. through 2020 relating to in-flight broadband connectivity technology on our aircraft. That agreement stipulated a $20 million minimum commitment for the connectivity service and a $25 million minimum commitment for the related hardware and software purchase. As part of the sale of LiveTV, these commitments to ViaSat Inc. were assigned to LiveTV and JetBlue entered into two new service agreements with LiveTV pursuant to which LiveTV will provide in-flight entertainment and connectivity services to JetBlue for a minimum of seven years.
As of September 30, 2017, we had approximately $29 million inrestricted cash assets serving as collateral for letters of credit relating to a certain number of our leases. These are included in restricted cash andleases, which will expire at the end of the related lease terms. We also had a $65 million letter of credit relating to our 5% ownership in JFK Millennium Partner LLC, a private entity that will finance, develop, and operate John F. Kennedy International Airport ("JFK") Terminal 6. The letters of credit are included in restricted cash on the consolidated balance sheets. Additionally, we had approximately $27$32 million cash pledged primarily related to our workersworkers' compensation insurance policies and other business partner agreements, which will expire according to the terms of the related policies or agreements.

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)



Labor Unions and Non-Unionized Crewmembers
As of March 31, 2024, 52% of our full-time equivalent crewmembers were represented by labor unions. The pilot group, which represents 22% of our full-time equivalent crewmembers, is covered by a collective bargaining agreement that have begun initial negotiations in April 2024. Our pilots are represented by ALPA. Our inflight crewmembers and flight instructors are represented by the Transport Workers Union of America ("TWU"); our other frontline crewmembers do not have third party representation.
ALPA
In January 2023, JetBlue pilots approved a two-year contract extension effective March 1, 2023, which included a ratification payment and adjustments to paid-time-off accruals resulting from pay rate increases of $95 million. This was recorded as an expense within special items in the first quarter of 2023.
TWU
On July 14, 2022, TWU filed a representation application with the National Mediation Board ("NMB") seeking an election among the 35 pilot instructors (called "Flight Instructors"). JetBlue disputed TWU’s application alleging that "Flight Instructors" do not constitute a craft or class. On October 26, 2023, the NMB notified the participants that it rejected JetBlue’s argument and ordered an election. The Flight Instructors voted for TWU representation. Contract negotiations have not yet begun.
Non-Unionized Crewmembers
We enter into individual employment agreements with each of our non-unionized FAA-licensed crewmembers, which include dispatchers, technicians, inspectors, and air traffic controllers. Each employment agreement is for a term of five years and automatically renews for an additional five years unless either the crewmember or we elect not to renew it by giving at least 90 days' notice before the end of the relevant term. Pursuant to these agreements, these crewmembers can only be terminated for cause. In the event of a downturn in our business that would require a reduction in work hours, we are obligated to pay these crewmembers a guaranteed level of income and to continue their benefits if they do not obtain other aviation employment.
Legal Matters
Occasionally, we are involved in various claims, lawsuits, regulatory examinations, investigations, and other legal matters involving suppliers, crewmembers, customers, and governmental agencies, arising, for the most part, in the ordinary course of business. The outcome of litigation and other legal matters is always uncertain. The Company believes it has valid defenses to the legal matters currently pending against it, is defending itself vigorously, and has recorded accruals determined in accordance with GAAP, where appropriate. In making a determination regarding accruals, using available information, we evaluate the likelihood of an unfavorable outcome in legal or regulatory proceedings to which we are a party and record a loss contingency when it is probable a liability has been incurred and the amount of the loss can be reasonably estimated. These subjective determinations are based on the status of such legal or regulatory proceedings, the merits of our defenses, and consultation with legal counsel. Actual outcomes of these legal and regulatory proceedings may materially differ from our current estimates. It is possible that resolution of one or more of the legal matters currently pending or threatened could result in losses material to our condensed consolidated results of operations, liquidity, or financial condition.
To date, none of these types of litigation matters, most of which are typically covered by insurance, has had a material impact on our operations or financial condition. We have insured and continue to insure against most of these types of claims. A judgment on any claim not covered by, or in excess of, our insurance coverage could materially adversely affect our condensed consolidated results of operations, liquidity, or financial condition.
As previously disclosed, in July 2020, JetBlue and American Airlines Group Inc. ("American") entered into the Northeast Alliance (the "NEA"), which was designed to optimize our respective networks at JFK Airport, LaGuardia Airport, Newark Liberty International Airport, and Boston Logan International Airport. On September 21, 2021, the United States Department of Justice, along with the Attorneys General of six states and the District of Columbia filed suit against JetBlue and American seeking to enjoin the NEA, alleging that it violated Section 1 of the Sherman Act. The court issued a decision on May 19, 2023, permanently enjoining the NEA, and shortly thereafter we initiated a wind down of the NEA. On July 28, 2023, the court issued its Final Judgement and Order Entering Permanent Injunction, which took effect on August 18, 2023 (the "Final Injunction"). The wind down of the NEA is substantially complete, but remaining impacts could require us to incur additional costs and therefore have an impact on our financial condition orand results of operations.


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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

In December 2022 and February 2023, four putative class actions lawsuits were filed in the United States District Court for the Eastern District of New York and the United States District Court for the District of Massachusetts, respectively, alleging that the NEA violates Sections 1 and 2 of the Sherman Act. Among other things, plaintiffs seek monetary damages on behalf of a putative class of direct purchasers of airline tickets from JetBlue and American and, depending on the specific case, other airlines on flights to or from NEA airports from July 16, 2020 through the present. Plaintiffs in these actions also seek to enjoin the NEA. JetBlue believes these lawsuits are without merit and has moved to dismiss the claims.
For information on legal proceedings related to our previously planned acquisition of Spirit, see Note 12.
Note 6—7 - Fair Value
Under Topic 820, Fair Value Measurement of the FASB Accounting Standards Codification, (the "Codification"), disclosures are required about how fair value is determined for assets and liabilities and a hierarchy for which these assets and liabilities must be grouped is established, based on significant levels of inputs as follows:
Level 1 - observable inputs such as unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2 - quoted prices in active markets for similar assets and liabilities, and other inputs that are observable directly or indirectly for the asset or liability; or
Level 3 - unobservable inputs for the asset or liability, such as discounted cash flow models or valuations.
The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
The following is a listing of our assets required to be measured at fair value on a recurring basis and where they are classified within the fair value hierarchy as of March 31, 2024 and December 31, 2023 (in millions):
March 31, 2024
Level 1Level 2Level 3Total
Assets
Cash equivalents$897 $— $— $897 
Available-for-sale investment securities— 240 16 256 
Aircraft fuel derivatives— 4 — 4 
December 31, 2023
Level 1Level 2Level 3Total
Assets
Cash equivalents$724 $— $— $724 
Available-for-sale investment securities— 314 16 330 
Aircraft fuel derivatives— 4 — 4 
Refer to Note 3 for fair value information related to our outstanding debt obligations as of March 31, 2024 and December 31, 2023.
Cash Equivalents
Our cash equivalents include money market securities and time deposits which are readily convertible into cash, have maturities of three months or less when purchased, and are considered to be highly liquid and easily tradable. The money market securities are valued using inputs observable in active markets for identical securities and are therefore classified as Level 1 within our fair value hierarchy and recorded within cash and cash equivalents on our consolidated balance sheets.

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

Available-for-Sale Investment Securities
Our available-for-sale investment securities include investments such as time deposits, commercial paper, and convertible debt securities. The fair value of time deposits and commercial paper is based on observable inputs in non-active markets, which are therefore classified as Level 2 in the hierarchy. The fair value of convertible debt securities is based on unobservable inputs and is classified as Level 3 in the hierarchy.
Aircraft Fuel Derivatives
Our aircraft fuel derivatives include call spread options which are not traded on public exchanges. Their fair values are determined using a market approach based on inputs that are readily available from public markets for commodities and energy trading activities; therefore, they are classified as Level 2 inputs. The data inputs are combined into qualitative models and processes to generate forward curves and volatility related to the specific terms of the underlying hedge contracts. Aircraft fuel derivatives are included in prepaid expenses and other within current assets of our consolidated balance sheets.
Held-to-Maturity Investment Securities
Our held-to-maturity investment securities consist of corporate bonds, which are stated at amortized cost. If the corporate bonds were measured at fair value, they would be classified as Level 2 in the fair value hierarchy, based on quoted prices in active markets for similar securities.
We do not intend to sell these investment securities. The carrying value and estimated fair value of our held-to-maturity investment securities were as follows (in millions):
March 31, 2024December 31, 2023
Carrying ValueFair ValueCarrying ValueFair Value
Held-to-maturity investment securities$215 $212 $234 $231 
Note 8 - Investments
Investments in Debt Securities
Investments in debt securities consist of available-for-sale and held-to-maturity investment securities. The carrying amount is recorded within investment securities in the current assets section of our consolidated balance sheets if the remaining maturity is less than twelve months. Maturities greater than twelve months are recorded within investment securities in the other assets section of our consolidated balance sheets. The aggregate carrying values of our short-term and long-term debt investment securities consisted of the following at March 31, 2024 and December 31, 2023 (in millions):
March 31, 2024December 31, 2023
Available-for-sale investment securities
Time deposits$215 $290 
Commercial paper25 24 
Debt securities16 16 
Total available-for-sale investment securities256 330 
Held-to-maturity investment securities
Corporate bonds215 234 
Total held-to-maturity investment securities215 234 
Total investments in debt securities$471 $564 
When sold, we use a specific identification method to determine the cost of the securities. Refer to Note 7 for an explanation of the fair value hierarchy structure.
We did not record any material gains or losses on available-for-sale or held-to-maturity investment securities during the three months ended March 31, 2024 and 2023.

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

Equity Investments
The aggregate carrying values of our equity investments are recorded in other assets on the consolidated balance sheets and consist of the following at March 31, 2024 and December 31, 2023 (in millions):
March 31, 2024December 31, 2023
Equity method investments (1)
$47 $43 
JetBlue Ventures equity investments (2)
79 96 
TWA Flight Center (3)
14 14 
Total equity investments (4)
$140 $153 
(1)We have the ability to exercise significant influence over these investments and therefore they are accounted for using the equity method in accordance with Topic 323, Investments - Equity Method and Joint Ventures of the FASB Codification. Our share of our equity method investees’ financial results is included in other income on our consolidated statement of operations. We did not record any material gains or losses on our equity method investment securities during the three months ended March 31, 2024 and 2023.
(2)Our wholly owned subsidiary JetBlue Technology Ventures LLC ("JBV") has equity investments are in emerging companies which do not have readily determinable fair values. In accordance with Topic 321, Investments - Equity Securities of the FASB Codification, we account for these investments using a measurement alternative which allows entities to measure these investments at cost, less any impairment, adjusted for changes from observable price changes in orderly transactions for identifiable or similar investments of the same issuer. Refer to the table below for investment gain (loss) activity during the three months ended March 31, 2024 and 2023.
(3) We have an approximate 10% ownership interest in the TWA Flight Center Hotel at JFK, which is accounted for under the measurement alternative described above. We did not record any material gains or losses on our TWA Flight Center Hotel during the three months ended March 31, 2024 and 2023.
(4) As of March 31, 2024 and December 31, 2023, we had an immaterial amount of equity securities recorded within investment securities in the current asset section of our consolidated balance sheets. Our equity securities include investments in common stocks of publicly traded companies which are stated at fair value. Refer to the table below for investment gain (loss) activity during the three months ended March 31, 2024 and 2023 (in millions):
March 31, 2024March 31, 2023
JBV Equity Investments
Unrealized loss recognized in gain (loss) on investments, net (1)
$(22)$— 
Equity Securities
Unrealized gain recognized in gain (loss) on investments, net— 3 
(1) The net unrealized loss primarily relates to a mark-to-market adjustment on our preferred shares of one of our JBV equity investments.
Note 9 - Financial Derivative Instruments and Risk Management
As part of our risk management techniques, we periodically purchase over the counter energy derivative instruments and enter into fixed forward price agreements, or FFPs, to manage our exposure to the effect of changes in the price of aircraft fuel. Prices for the underlying commodities have historically been highly correlated to aircraft fuel, making derivatives of them effective at providing short-term protection against sharp increases in average fuel prices. We also periodically enter into jet fuel basis swaps for the differential between heating oil and jet fuel, to further limit the variability in fuel prices at various locations. We do not hold or issue any derivative financial instruments for trading purposes.

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

Aircraft fuel derivativesFuel Derivatives
We attempt to obtain cash flow hedge accounting treatment for each fuel derivative that we enter into. This treatment is provided for under the Derivatives and Hedging topic of the FASB Codification which allows for gains and losses on the effective portion of qualifying hedges to be deferred until the underlying planned jetaircraft fuel consumption occurs, rather than recognizing the gains and losses on these instruments into earnings during each period they are outstanding. The
For the effective portion of realizedhedges, when aircraft fuel hedgingis consumed and the related derivative gains and lossescontract settles, any gain or loss previously recorded in other comprehensive income (loss) is recognized in aircraft fuel expense in the period during which the underlyingexpense. All cash flows related to our fuel is consumed.hedging derivatives are classified as operating cash flows.
Ineffectiveness occurs, in certain circumstances, when the change in the total fair value of the derivative instrument differs from the change in the value of our expected future cash outlays for the purchase of aircraft fuel. Ineffectiveness is recognized immediately in interest income and other. If a hedge does not qualify for hedge accounting, the periodic changes in its fair value are also recognized in interest income and other. When aircraft fuel is consumed and the related derivative contract settles, any gain or loss previously recorded in other comprehensive income is recognized in aircraft fuel expense. All cash flows related to our fuel hedging derivatives are classified as operating cash flows.
Our current approach to fuel hedging is to enter into hedges on a discretionary basis without a specific target of hedge percentage needs.basis. We view our hedge portfolio as a form of insurance to help mitigate the impact of price volatility and protect us against severe spikes in oil prices, when possible.
The following table illustrates the approximate hedged percentages of our projected fuel usage by quarter as of September 30, 2017March 31, 2024 related to our outstanding fuel hedging contracts that were designated as cash flow hedges for accounting purposes.
 Jet fuel swap
agreements		 Jet fuel collar agreements Heating oil collar agreements Total
Fourth Quarter 201710% —% —% 10%

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JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)



Aircraft fuel call option spread agreements
Second quarter 202427 %
Third quarter 20243 %
Fourth quarter 20245 %
The table below reflects quantitative information related to our derivative instruments and where these amounts are recorded in our financial statements (dollar amounts in millions):
March 31, 2024December 31, 2023
Fuel derivatives
Asset fair value recorded in prepaid expenses and other current assets (1)
$4 $4 
Longest remaining term (months)33
Hedged volume (barrels, in thousands)1,827 2,706 
Estimated amount of existing gains (losses) expected to be reclassified into earnings in the next 12 months$— $(3)
Fuel derivativesSeptember 30,
2017		 December 31,
2016
Asset fair value recorded in prepaid expense and other(1)
$6
 $22
Longest remaining term (months)3
 12
Hedged volume (barrels, in thousands)480
 1,920
Estimated amount of existing (gains) expected to be reclassified into earnings in the next 12 months$(5) $(22)
 Three Months Ended September 30, Nine Months Ended September 30,
Fuel derivatives2017 2016 2017 2016
Hedge effectiveness (gains) recognized in aircraft fuel expense$(4) $(1) $(8) $(1)
Hedge (gains) losses on derivatives recognized in comprehensive income(9) 8
 8
 (23)
Percentage of actual consumption economically hedged10% 24% 10% 8%

(1) Gross asset or liability of each contract prior to consideration of offsetting positions with each counterparty and prior to the impact of collateral paid.
Three Months Ended March 31,
20242023
Fuel derivatives
Hedge effectiveness gains (losses) recognized in aircraft fuel expense$(2)$1 
Hedge gains (losses) on derivatives recognized in comprehensive income$1 $(5)
Percentage of actual consumption economically hedged30 %9 %
Any outstanding derivative instrument exposes us to credit loss in connection with our fuel contracts in the event of nonperformance by the counterparties to our agreements, butagreements; however, we do not expect that any of our counterparties will fail to meet their obligations. The amount of such credit exposure is generally the fair value of our outstanding contracts for which we

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

are in a receivable position. To manage credit risks we select counterparties based on credit assessments, limit our overall exposure to any single counterparty, and monitor the market position with each counterparty. Some of our agreements require cash deposits from either JetBlue or our counterparty if market risk exposure exceeds a specified threshold amount.
We have master netting arrangements with our counterparties allowing us the right of offset to mitigate credit risk in derivative transactions. The financial derivative instrument agreements we have with our counterparties may require us to fund all, or a portion of, outstanding loss positions related to these contracts prior to their scheduled maturities. The amount of collateral posted, if any, is periodically adjusted based on the fair value of the hedge contracts. Our policy is to offset the liabilities represented by these contracts with any cash collateral paid to the counterparties.
The impact ofThere were no offsetting derivative instruments is depicted below (in millions):as of March 31, 2024 and December 31, 2023.
 Gross Amount of Recognized Gross Amount of Cash Collateral Net Amount Presented on Balance Sheet
Fuel derivativesAssets Liabilities Offset Assets Liabilities
As of September 30, 2017$6
 $—
 $—
 $6
 $—
As of December 31, 2016$22
 $—
 $—
 $22
 $—



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JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)


Note 7—Fair Value
Under the Fair Value Measurements and Disclosures topic of the Codification, disclosures are required about how fair value is determined for assets and liabilities and a hierarchy for which these assets and liabilities must be grouped is established, based on significant levels of inputs as follows:
Level 1 quoted prices in active markets for identical assets or liabilities;
Level 2 quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability; or
Level 3 unobservable inputs for the asset or liability, such as discounted cash flow models or valuations.
The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
The following is a listing of our assets and liabilities required to be measured at fair value on a recurring basis and where they are classified within the fair value hierarchy as of September 30, 2017 and December 31, 2016 (in millions):
 September 30, 2017
AssetsLevel 1 Level 2 Level 3 Total
Cash equivalents$254
 $—
 $—
 $254
Available-for-sale investment securities—
 163
 —
 163
Aircraft fuel derivatives—
 6
 —
 6
 $254
 $169
 $—
 $423

 December 31, 2016
AssetsLevel 1 Level 2 Level 3 Total
Cash equivalents$313
 $—
 $—
 $313
Available-for-sale investment securities115
 220
 —
 335
Aircraft fuel derivatives—
 22
 —
 22
 $428
 $242
 $—
 $670
Refer to Note 2 for fair value information related to our outstanding debt obligations as of September 30, 2017 and December 31, 2016.
Cash equivalents
Our cash equivalents include money market securities and commercial paper which are readily convertible into cash, have maturities of 90 days or less when purchased and are considered to be highly liquid and easily tradable. These securities are valued using inputs observable in active markets for identical securities and are therefore classified as Level 1 within our fair value hierarchy.
Available-for-sale investment securities
Included in our available-for-sale investment securities are U.S. treasury bills, time deposits, commercial paper and debt securities with maturities of greater than 90 days but less than one year. The U.S. treasury bills are valued using inputs observable in active markets for identical securities and are therefore classified as Level 1 within our fair value hierarchy. The fair values of our time deposits, commercial paper and debt securities instruments are based on observable inputs in non-active markets and are therefore classified as Level 2 in the hierarchy. We did not record any significant gains or losses on these securities during the three and nine months ended September 30, 2017 and 2016.

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JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)


Aircraft fuel derivatives
Our aircraft fuel derivatives include swaps, collars, and basis swaps which are not traded on public exchanges. Heating oil and jet fuel are the products underlying these hedge contracts as they are highly correlated with the price of jet fuel. Their fair values are determined using a market approach based on inputs that are readily available from public markets for commodities and energy trading activities. Therefore, they are classified as Level 2 in the hierarchy. The data inputs are combined into quantitative models and processes to generate forward curves and volatilities related to the specific terms of the underlying hedge contracts.

Note 8—10 - Accumulated Other Comprehensive Income (Loss)
Comprehensive income (loss) includes changes in fair value of our aircraft fuel derivatives and interest rate swap agreements, which qualify for hedge accounting.accounting and unrealized gain (loss) on available-for-sale securities. A rollforward of the amounts included in the accumulated other comprehensive income (loss), net of taxes for the three months ended September 30, 2017March 31, 2024 and September 30, 2016 are2023 is as follows (in millions):
 
Aircraft Fuel Derivatives(1)
 
Interest Rate Swaps(2)
 Total
Balance of accumulated income at June 30, 2017$—
 $—
 $—
Reclassifications into earnings (net of $(2) of taxes)(2) —
 (2)
Change in fair value (net of $3 of taxes)6
 —
 6
Balance of accumulated income at September 30, 2017$4
 $—
 $4
      
Balance of accumulated income at June 30, 2016$15
 $1
 $16
Reclassifications into earnings (net of $0 of taxes)(1) (1) (2)
Change in fair value (net of $(4) of taxes)(4) —
 (4)
Balance of accumulated income at September 30, 2016$10
 $—
 $10
Aircraft fuel derivatives (1)
Available-for-sale securitiesTotal
Balance of accumulated loss, at December 31, 2023$(3)$(1)$(4)
Reclassifications into earnings, net of taxes of $02 — 2 
Change in fair value, net of taxes of $01 — 1 
Balance of accumulated gain (loss), at March 31, 2024$— $(1)$(1)
Balance of accumulated income (loss), at December 31, 2022$1 $(1)$— 
Reclassifications into earnings, net of taxes $0(1)— (1)
Change in fair value, net of taxes of $(1)(4)— (4)
Balance of accumulated loss, at March 31, 2023$(4)$(1)$(5)

    (1) Reclassified to aircraft fuel expenseexpense.
(2) Reclassified to interest expense
A rollforwardNote 11 - Special Items
The following is a listing of the amounts included in the accumulated other comprehensive income (loss), netspecial items presented on our consolidated statements of taxesoperations for the ninethree months ended September 30, 2017March 31, 2024 and September 30, 2016 are as follows2023 (in millions):
Three Months Ended March 31,
20242023
Special items
Spirit-related costs (1)
$532 $17 
Voluntary opt-out costs (2)
15 — 
Embraer E190 fleet transition costs (3)
15 — 
Union contract costs (4)
— 95 
Total special items$562 $112 
 
Aircraft Fuel Derivatives(1)
 
Interest Rate Swaps(2)
 Total
Balance of accumulated income at December 31, 2016$13
 $—
 $13
Reclassifications into earnings (net of $(3) of taxes)(5) —
 (5)
Change in fair value (net of $(4) of taxes)(4) —
 (4)
Balance of accumulated income at September 30, 2017$4
 $—
 $4
      
Balance of accumulated income (losses) at December 31, 2015$(4) $1
 $(3)
Reclassifications into earnings (net of $0 of taxes)(1) (1) (2)
Change in fair value (net of $(8) of taxes)15
 —
 15
Balance of accumulated income at September 30, 2016$10
 $—
 $10
(1) As a result of the termination of the Merger Agreement in the first quarter of 2024, we wrote off the Spirit prepayment and breakup fee discussed in Note 12. These costs also include consulting, professional, and legal fees. Spirit costs in the first quarter of 2023 primarily relate to consulting, professional and legal fees.
(1) Reclassified(2) Voluntary opt-out costs relate to aircraft fuel expense
(2) Reclassified to interest expense

severance and benefit costs associated with the Company's opt-out program for eligible
16

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)


crewmembers in the airports, customer support, JetBlue Travel Products and support center workgroups.
(3) Embraer E190 fleet transition costs relate to the early termination of a flight-hour engine services agreement.
(4) Union contract costs primarily relate to pilot ratification payments and adjustments to paid-time-off accruals resulting from pay rate increases. See Note 6 for further discussion.
Note 12 - Termination ofMerger Agreement with Spirit
The Merger Agreement
As previously disclosed, on July 28, 2022, JetBlue entered into the Merger Agreement with Spirit and Sundown Acquisition Corp., formerly a Delaware corporation and a direct wholly owned subsidiary of JetBlue ("Merger Sub"), pursuant to which and subject to the terms and conditions therein, Merger Sub would merge with and into Spirit, with Spirit continuing as the surviving corporation (the "Merger").
On March 1, 2024, JetBlue, Spirit and Merger Sub entered into a Termination Agreement (the "Termination Agreement"), pursuant to which the parties agreed to terminate the Merger Agreement, effective immediately, subject to limited exceptions related to JetBlue’s previously agreed indemnification obligations.Pursuant to the Termination Agreement, JetBlue agreed to pay the $69 million breakup fee on March 5, 2024, which was recorded in special items on the consolidated statement of operations. The parties also agreed to release each other from claims, demands, damages, actions, causes of action and liability relating to or arising out of the Merger Agreement and the transactions contemplated therein or thereby.
In accordance with the terms of the Merger Agreement, on a monthly basis between January 2023 and February 2024, JetBlue paid to the holders of record of outstanding Spirit shares an amount in cash equal to $0.10 per Spirit share (such amount, the "Additional Prepayment Amount", and each such monthly payment, an "Additional Prepayment"). During the quarter ended March 31, 2024, JetBlue made an aggregate of $22 million in Additional Prepayments to Spirit shareholders resulting in a total prepayment of $425 million. These Additional Prepayments have been written off, in addition to the $25 million reimbursement payment to Spirit in connection with the Frontier transaction costs as a result of the termination of the Merger Agreement. The write off is recorded in special items on the consolidated statement of operations for the period ending March 31, 2024.
In the first quarter of 2024, the Company recorded a valuation allowance of $134 million related to the tax impact of the Spirit transaction costs.
Refer to Note 3 for further detail of the $3.5 billion Senior Secured Bridge Facility commitment to fund the purchase of Spirit, which was terminated concurrently with the termination of the Merger Agreement.
Legal Proceedings Related to the Merger
As previously disclosed, in March 2023, the U.S. Department of Justice, along with the Attorneys General of six states and the District of Columbia, filed suit in the U.S. District Court for the District of Massachusetts against JetBlue and Spirit, seeking a permanent injunction preventing the Merger (the "Government Merger Lawsuit"). The trial commenced on October 31, 2023 and on January 17, 2024, the Court issued its Final Judgment and Order granting the plaintiffs' request for a permanent injunction of the Merger. On January 19, 2024, JetBlue and Spirit filed a Notice of Appeal with respect to the January 17, 2024 Final Judgment and Order and the Court’s corresponding January 16, 2024 Findings of Facts and Conclusion of Law, which the parties then moved to dismiss following their entrance into the Termination Agreement. On March 5, 2024, the Court approved JetBlue and Spirit's voluntary dismissal of the appeal.
As also previously disclosed, on November 3, 2022, 25 individual consumers filed suit in the U.S. District Court for the Northern District of California against JetBlue and Spirit seeking to enjoin the Merger, alleging that it violates Section 7 of the Clayton Act (the "Private Merger Lawsuit"). On March 29, 2023, the Private Merger Lawsuit was transferred to the U.S. District Court for the District of Massachusetts. The trial in the Private Merger Lawsuit was stayed pending resolution of the Government Merger Lawsuit. Following the execution of the Termination Agreement, JetBlue and Spirit moved to dismiss all proceedings related to the Private Merger Lawsuit in the U.S. District Court for the District of Massachusetts and The United States Court of Appeals for the First Circuit. The motions to dismiss remain pending at this time.


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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Part I, Item 2 of this Report should be read together with our condensed consolidated financial statements and related notes included elsewhere in this Report and our audited consolidated financial statements and related notes included in our 2023 Form 10-K. This discussion contains forward-looking statements based upon current plans, expectations and beliefs involving risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in Part I, Item 1A "Risk Factors" of our 2023 Form 10-K and in Part II, Item 1A "Risk Factors" and other parts of this Report.
OVERVIEW
ThirdFirst Quarter 2017 Highlights2024 Results
We had an $81 million increase in operating revenueIn the first quarter of 2024, we experienced improved operational reliability and healthy peak demand. Despite industry cost pressures, we continue to execute on our controllable cost initiatives.
Our first quarter highlights include as follows:
•First quarter 2024 system capacity decreased by 2.7% compared to the thirdfirst quarter of 2016 due primarily to a 3.7% increase in capacity, and a 1.0% increase in yield per passenger mile.2023.
We generated $1.1 billion in cash from operations•Revenue for the nine months ended September 30, 2017.
•
Operating expense per available seat mile increased by 5.2% to 10.5 cents, primarily due to an increase in aircraft fuel expenses. Excluding fuel and related taxes, as well as operating expenses related to our non-airline operations,  our cost per available seat mile(1) increased by 2.7% including a 2.7 point impact from Hurricanes Irma and Maria.
Operating income was $310 million, a decrease of $44 million from the comparable period in 2016. This decrease was principally driven by an increase in salaries and aircraft fuel expenses, partially offset by an increase in revenues. Hurricanes Irma and Maria negatively impacted our operating income by approximately $33 million.
Balance Sheet
We ended the thirdfirst quarter of 2017 with unrestricted cash, cash equivalents and short-term investments of $8142024 decreased by $119 million and undrawn lines of credit of approximately $625 million. In June 2017, Moody's Investor Service upgraded our debt ratingyear-over-year to Ba1 from Ba3 with$2.2 billion, a stable outlook reflecting5.1% decrease compared to the strength of our financial position. Our unrestricted cash, cash equivalents and short-term investments are approximately 12% of trailing twelve months revenue. We increased the number of unencumbered aircraft by three during the quarter by using cash on hand to pay for our deliveries. We had 110 unencumbered aircraft and 37 unencumbered spare engines as of September 30, 2017.
Network
Our growth strategy remains targeted on margin-accretive opportunities in our focus cities, particularly in Boston and Fort Lauderdale. Approximately 97% of our growth in the past five years has been in our six focus cities, and 92% has been in New York, Boston and Fort Lauderdale. Targeted growth continues as we work towards 200 daily departures from Boston and 140 from Fort Lauderdale. We now have weekday Mint service in New York, Boston and Fort Lauderdale to Los Angeles and San Francisco. In Boston, we expect to launch service to Syracuse and Minneapolis in 2018 bringing our network in Boston to 65 destinations. In Fort Lauderdale, we expect to add new service to Atlanta during March 2018.
Outlook for 2017
For the fourthfirst quarter of 2017, cost2023.
•Operating expense for the first quarter of 2024 increased by 14.0% year-over-year to $2.9 billion.
•Operating expense, excluding special items for the first quarter of 2024 decreased 3.7%(1) year-over-year.
•Operating expense per available seat mile excluding("CASM") for the first quarter of 2024 increased by 17.1% year-over-year to 17.95 cents compared to the first quarter of 2023.
•Our operating expense for the first quarter of 2024 and 2023 included the effects of special items. Excluding aircraft fuel,(1) is expected special items, and operating expenses related to increase between 5.0% and 7.0% over the comparable 2016 period, including an impact of approximately 2.5 points from Hurricanes Irma and Maria. In addition, we expect operating capacity to increase between 4.5% and 5.5% over the comparable 2016 period, including a negative impact from hurricanes of approximately 2.9 points.
For the full year 2017, we expectour non-airline businesses, our operating capacityexpense (1) increased by 4.2% to increase between 4.0%$1.7 billion year-over-year.
•Excluding fuel, special items, and 5.0% over full year 2016 with the addition of six Airbus A321 aircraftoperating expenses related to our operating fleet during the fourth quarter of 2017, including a negative impact from hurricanes of approximately 1.4 points. We expectnon-airline businesses, our cost per available seat mile excluding fuel("CASM ex-fuel")(1), increased by 7.1% to 10.57 cents in the first quarter of 2024 compared to the first quarter of 2023.
•For the first quarter of 2024 and 2023, our reported loss per share was $2.11 and $0.58, respectively. Excluding special items, our adjusted loss per share (1) for full year 2017the first quarter of 2024 and 2023 was $0.43 and $0.34, respectively.
Recent Developments
Network
During the quarter, we expanded our presence in the transatlantic market with new seasonal service to increase between 4.0%Dublin, Ireland from New York and 5.0% over full year 2016,Boston, and launched daily nonstop service to Paris Charles de Gaulle Airport from Boston. We also began service to Tallahassee, Florida.
We announced we will be moving a number of routes and markets from daily service to seasonal service to free up aircraft for increased frequency and relevance in markets that are more profitable. We have actioned to leave Baltimore, Maryland; Bogota, Colombia; Burlington, Vermont; Kansas City, Missouri; Lima, Peru; Newburgh, New York; and Quito, Ecuador, to better utilize our aircraft in other markets.
Customer Experience
We announced new and improved signature perks for Mosaic program members, including an impact of approximately 1.5 points from Hurricanes Irmadedicated phone support, greater access to the Mint cabin, and Maria.the ability to gift Mosaic 1 status, further expanding the ways our most loyal customers can be awarded.

We announced new Mint® product offerings expected to launch in Spring 2024, including new amenity partners, menu changes and entertainment options.

We launched preferred seating on select routes, giving customers more options to choose the seat that best aligns with their preferences.


(1)Refer to our "Regulation G Reconciliation"Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.

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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Pratt & Whitney
In July 2023, Pratt & Whitney, a division of Raytheon Technologies, announced the requirement, mandated by the Federal Aviation Administration ("FAA"), for removal of certain engines for inspection due to contaminated powdered metal used in high-pressure turbine disks on the V2500, PW1100G, and PW1500G engine types. These engines power our Airbus A320, Airbus A220 and Airbus A321neo fleets. The contaminated powdered metal affects engines manufactured between October 2015 and September 2021. Engines are now required to be inspected after they have reached a reduced number of cycles dependent on the fleet type. As of March 31, 2024, we had nine aircraft grounded for required inspection. The Company currently expects each removed engine to take up to 360 days to complete a shop visit and return to a serviceable condition and expects an average of 11 aircraft out of service throughout the year.
In 2023, we reached a confidential settlement agreement with Pratt & Whitney, which was intended to address damages incurred by us in 2023 due to the grounding of the affected engines. Into 2024 and beyond, we expect to have a certain number of engines grounded and, therefore, will continue to assess the resulting impact on our future capacity plans. We are currently working with Pratt & Whitney on compensation arrangements.
While we are working with Pratt & Whitney to secure additional compensation, the full impact of the removal and any potential remediation steps remains uncertain. The engine groundings, including but not limited to a reduction in capacity, could adversely impact our operations and financial results.
RESULTS OF OPERATIONS
Three Months Ended September 30, 2017March 31, 2024 vs. 20162023
Overview
We reported a net incomeloss of $179$716 million, operating loss of $719 million and an operating margin of (32.6)% for the three months ended March 31, 2024. This compares to net loss of $192 million, an operating incomeloss of $310$242 million and an operating margin of 17.1%(10.4)% for the three months ended September 30, 2017. This compares to net income of $199 million, an operating income of $354 million and an operating margin of 20.5%March 31, 2023. Our loss per share was $2.11 for the three months ended September 30, 2016. Diluted earningsfirst quarter of 2024 compared to a loss per share were $0.55 for the third quarter of 2017 compared to $0.58 for the same period in 2016. The third quarter presented unprecedented weather challenges for JetBlue, with two2023. Net loss increased $524 million year-over-year primarily due to the write off of Spirit-related costs as a result of the largest hurricanestermination of the Merger Agreement discussed in Note 12 to our history impactingcondensed consolidated financial statements included in Part I, Item 1 of this Report.
Our reported results for the three months ended March 31, 2024 included the effects of special items. Adjusting for these one-time items, our network. We estimate that third quarter revenueadjusted net loss (1) was negatively impacted by approximately $44 million. Revenue$145 million, adjusted operating loss (1) was $157 million, adjusted operating margin (1) was (7.1)%, and adjusted loss per available seat mile (RASM)share (1) was positively impacted by an approximate 0.3 percentage points by$0.43 for the hurricanes. Operating income three months ended March 31, 2024.
Our reported results for the three months ended March 31, 2023 included the effects of special items. Adjusting for these one-time items,our adjusted net loss (1) was negatively impacted by approximately $33 million.$111 million, adjusted operating loss (1) was $130 million, adjusted operating margin (1) was (5.6)%, and adjusted loss per share (1) was $0.34 for the three months ended March 31, 2023.
On-time performance, as defined by the Department of Transportation, or DOT, is arrival within 14 minutes of scheduled arrival time. In the thirdfirst quarter of 2017,2024, our systemwide on-time performance was 68.8% 70.9% compared to 73.9%70.4% for the same period in 2016.2023. Our on-time performance remains challenged by our concentration of operationscompletion factor decreased to 98.7% in the northeast of the U.S., one of the world's most congested airspaces. Our completion factor was 95.3% in the thirdfirst quarter of 2017 and 98.9%2024 from 98.8% in the same period in 2016. Hurricanes Irma and Maria resulted in over 3,000 canceled flights, or about 3%2023.
(1) Refer to "Regulation G Reconciliation of departures. In addition, runway closuresNon-GAAP Financial Measures" at JFK and Boston had a negative impactthe end of this section for more information on our on-time performance in the third quarterthis non-GAAP measure.            
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Table of 2017.Contents
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Operating Revenues
(Revenues in millions; percent changes based on unrounded numbers)Three Months Ended March 31,Year-over-Year
Change
20242023$%
Passenger revenue$2,055 $2,182 $(127)(5.8)%
Other revenue154 146 8 5.5 %
Total operating revenues$2,209 $2,328 $(119)(5.1)%
Average fare$214.39 $214.07 $0.32 0.1 %
Yield per passenger mile (cents)15.80 16.31 (0.51)(3.1)
Passenger revenue per ASM (cents)12.60 13.01 (0.41)(3.2)
Operating revenue per ASM (cents)13.54 13.88 (0.34)(2.5)
Average stage length (miles)1,279 1,199 80 6.7 
Revenue passengers (thousands)9,584 10,192 (608)(6.0)
Revenue passenger miles (millions)13,002 13,375 (373)(2.8)
Available seat miles (ASMs) (millions)16,313 16,769 (456)(2.7)
Load factor79.7 %79.8 %(0.1)pts.
(Revenues in millions; percent changes based on unrounded numbers)Three months ended September 30, Year-over-Year Change
2017 2016 $ %
Passenger revenue$1,623
 $1,571
 $52
 3.3
 
Other revenue190
 161
 29
 18.2
 
Total operating revenues$1,813
 $1,732
 $81
 4.7
 
         
Average Fare$158.68
 $157.87
 $0.81
 0.5
 
Yield per passenger mile (cents)13.32
 13.20
 0.12
 1.0
 
Passenger revenue per ASM (cents)11.34
 11.39
 (0.05) (0.4) 
Operating revenue per ASM (cents)12.67
 12.55
 0.12
 0.9
 
Average stage length (miles)1,069
 1,091
 (22) (2.0) 
Revenue passengers (thousands)10,227
 9,953
 274
 2.8
 
Revenue passenger miles (millions)12,180
 11,905
 275
 2.3
 
Available Seat Miles (ASMs) (millions)14,306
 13,796
 510
 3.7
 
Load Factor85.1% 86.3%   (1.2)pts.
Passenger revenue is our primary source of revenue, which includes seat revenue and baggage fees, as well as revenue from our ancillary product offerings such as EvenMore™Even More® Space. The increase decrease in passenger revenue of $52$127 million, or 3.3%5.8%, for the three months ended September 30, 2017,March 31, 2024, compared to the same period in 2016,2023, was primarily attributabledue to both a 2.8% increase6.0% decrease in revenue passengers and a 3.1% decrease in addition to a 0.5% increase in average fare. The increase in otheryield per passenger mile.
Other revenue is primarily comprised of $29 million, or 18.2%, for the three months ended September 30, 2017, compared tomarketing component of the same period in 2016, was primarily attributable to an increase insales of our loyaltyTrueBlue® points. It also includes revenue from our co-brand credit card agreement. Operating revenues for the three months ended September 30, 2017 were negatively impact by approximately $44 million due to Hurricanes Irmasale of vacation packages, airport concessions and Maria. We are continuously looking to expand our other ancillary revenue opportunities and improve our TrueBlue® loyalty program.

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advertising revenue.
Operating Expenses
In detail, our operating costs per available seat mile, or ASM, were as follows:
(in millions; per ASM data in cents; percent changes based on unrounded numbers)Three Months Ended March 31,Year-over-Year ChangeCents per ASM
20242023$%20242023% Change
Aircraft fuel$625 $785 $(160)(20.4)%3.84 4.68 (18.1)%
Salaries, wages and benefits823 741 82 11.0 5.04 4.42 14.1 
Landing fees and other rents165 160 5 3.1 1.01 0.95 5.9 
Depreciation and amortization158 151 7 4.6 0.97 0.90 7.6 
Aircraft rent27 32 (5)(16.1)0.16 0.19 (13.8)
Sales and marketing77 76 1 1.7 0.47 0.45 4.6 
Maintenance, materials, and repairs132 176 (44)(24.2)0.81 1.04 (22.1)
Special items562 112 450 
NM (2)
3.44 0.68 NM
Other operating expenses359 337 22 6.3 2.21 2.01 9.3 
Total operating expenses$2,928 $2,570 $358 14.0 %17.95 15.32 17.1 %
Total operating expenses excluding special items (1)
$2,366 $2,458 $(92)(3.7)%14.51 14.64 (1.0)%
(2) Not meaningful or greater than 100% change.
(1) Refer to "Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
26
(in millions; per ASM data in cents; percent changes based on unrounded numbers)Three Months Ended September 30, Year-over-Year Change Cents per ASM
2017 2016 $ % 2017 2016 % Change
Aircraft fuel and related taxes$347
 $293
 $54
 18.3 % 2.42
 2.13
 14.1 %
Salaries, wages and benefits466
 421
 45
 10.9
 3.26
 3.05
 7.0
Landing fees and other rents104
 98
 6
 5.4
 0.73
 0.71
 1.6
Depreciation and amortization114
 102
 12
 11.8
 0.79
 0.74
 7.8
Aircraft rent26
 28
 (2) (9.5) 0.18
 0.19
 (12.7)
Sales and marketing68
 60
 8
 13.2
 0.48
 0.44
 9.2
Maintenance materials and repairs149
 153
 (4) (2.4) 1.04
 1.11
 (5.9)
Other operating expenses229
 223
 6
 2.9
 1.60
 1.62
 (0.8)
Total operating expenses$1,503
 $1,378
 $125
 9.1 % 10.50
 9.99
 5.2 %
Table of Contents
Aircraft Fuel and Related TaxesPART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Aircraft Fuel
Aircraft fuel and related taxes increaseddecreased by $54$160 million, or 18.3%20.4%, for the three months ended September 30, 2017March 31, 2024 compared to the same period in 2016. The2023. Over the same period, the average fuel price decreased by 17.3% to $2.97 per gallon and fuel consumption decreased by 3.8%, or 9 million gallons.
Salaries, Wages and Benefits
Salaries, wages and benefits increased $82 million, or 11.0%, for the third quarter 2017 increased by 14.6% to $1.69 per gallon. Our fuel consumption increased 3.3%, or 7 million gallons, due to an increase in the average number of aircraft operating during the third quarter 2017 asthree months ended March 31, 2024 compared to the same period in 2016.2023 driven by wage rate increases. The wage rate increase was primarily due to the new pilot union contract effective March 1, 2023, which included an initial pay rate increase of 14% and an additional 3% pay rate increase effective August 2023.
Salaries, Wages and BenefitsAircraft Rent
Salaries, wages and benefits increased $45Aircraft rent decreased $5 million, or 10.9%16.1%, in the three months ended March 31, 2024 compared to the same period in 2023, primarily due to fewer leases for Airbus A320 aircraft and Embraer E190 aircraft.
Maintenance, Materials, and Repairs
Maintenance, materials, and repairs decreased $44 million, or 24.2%, for the three months ended September 30, 2017March 31, 2024 compared to the same period in 2016, primarily driven by additional headcount. It was our largest expense for the quarter, representing approximately 31% of our total operating expenses. During 2016, we announced that effective January 1, 2017, non-management profit sharing eligible Crewmembers would receive an 8% raise and a modified profit sharing plan. We believe this recognition and change to our compensation structure reflects industry trends and ensures that our Crewmember compensation and rewards are fair and competitive. The wage increase, along with higher labor costs2023 due to challenging conditions intiming and the operation, were partially offset by lower profit sharing.
Depreciation and Amortization
Depreciation and amortization increased $12 million, or 11.8%, for the three months ended September 30, 2017 compared to the same period in 2016, primarily driven by a 6.7% increase in the average numbertype of aircraft operatingmaintenance events that occurred during the third quarter of 2017 as compared to the same period in 2016.period.


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Nine Months Ended September 30, 2017 vs. 2016
Overview
We reported net income of $475 million, an operating income of $811 million and an operating margin of 15.4% for the nine months ended September 30, 2017. This compares to net income of $587 million, an operating income of $1.0 billion and an operating margin of 20.4% for the nine months ended September 30, 2016. Diluted earnings per share were $1.43 for the nine months ended September 30, 2017 compared to $1.72 for the same period in 2016. We faced unprecedented weather challenges during the third quarter for 2017 with two of the largest hurricanes in our history impacting our network. Operating income was reduced by approximately $33 million. Available seat miles were negatively impacted by approximately 2.7% due to the hurricanes. For the third quarter of 2017, capacity increased approximately 3.7%.
Approximately 75% of our operations reside in the heavily populated northeast corridor of the U.S., which includes the New York and Boston metropolitan areas. During the first three months of 2016, a series of winter storms impacted this area, with Boston's Logan Airport experiencing record breaking snowfall totals. During the third quarter of 2017, a series of hurricanes caused over 33 days of interrupted service, resulting in an estimated $44 million negative impact to revenue.
Operating Revenues
(Revenues in millions; percent changes based on unrounded numbers)Nine Months Ended September 30, Year-over-Year Change
2017 2016 $ %
Passenger revenue$4,724
 $4,536
 $188
 4.2
 
Other revenue535
 455
 80
 17.4
 
Total operating revenues$5,259
 $4,991
 $268
 5.4
 
         
Average Fare$156.17
 $157.88
 $(1.71) (1.1) 
Yield per passenger mile (cents)13.23
 13.17
 0.06
 0.4
 
Passenger revenue per ASM (cents)11.21
 11.22
 (0.01) (0.1) 
Operating revenue per ASM (cents)12.48
 12.35
 0.13
 1.1
 
Average stage length (miles)1,072
 1,099
 (27) (2.5) 
Revenue passengers (thousands)30,251
 28,731
 1,520
 5.3
 
Revenue passenger miles (millions)35,712
 34,434
 1,278
 3.7
 
Available Seat Miles (ASMs) (millions)42,131
 40,421
 1,710
 4.2
 
Load Factor84.8% 85.2%   (0.4)pts.
The increase in passenger revenue of $188 million, or 4.2% for the nine months ended September 30, 2017, compared to the same period in 2016, was primarily attributable to a 5.3% increase in revenue passengers, partially offset by a 1.1% decrease in average fare. The increase in other revenue of $80 million, or 17.4%, for the nine months ended September 30, 2017, compared to the same period in 2016, was primarily attributable to an increase in our loyalty revenue from our co-brand credit card which originally launched in the first quarter of 2016. We are continuously looking to expand our other ancillary revenue opportunities and improve our TrueBlue® loyalty program.


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Operating Expenses
In detail, our operating costs per available seat mile, or ASM, were as follows:
(in millions; per ASM data in cents; percent changes based on unrounded numbers)Nine Months Ended September 30, Year-over-Year Change Cents per ASM
2017 2016 $ % 2017 2016 % Change
Aircraft fuel and related taxes$994
 $782
 $212
 27.1 % 2.36
 1.94
 22.0 %
Salaries, wages and benefits1,397
 1,270
 127
 10.0
 3.32
 3.14
 5.5
Landing fees and other rents301
 276
 25
 9.1
 0.71
 0.68
 4.7
Depreciation and amortization328
 289
 39
 13.2
 0.78
 0.71
 8.6
Aircraft rent75
 84
 (9) (9.9) 0.18
 0.21
 (13.5)
Sales and marketing195
 197
 (2) (0.8) 0.46
 0.49
 (4.8)
Maintenance materials and repairs467
 427
 40
 9.3
 1.11
 1.05
 4.9
Other operating expenses691
 650
 41
 6.3
 1.64
 1.61
 1.9
Total operating expenses$4,448
 $3,975
 $473
 11.9 % 10.56
 9.83
 7.4 %
Aircraft Fuel and Related Taxes
Aircraft fuel and related taxes increased by $212 million, or 27.1%, for the nine months ended September 30, 2017 compared to the same period in 2016, and represented approximately 22.4% of our total operating expenses. The increase was primarily driven by a increase in average fuel cost per gallon from $1.37 in 2016 to $1.66 in 2017. Our fuel consumption increased 25 million gallons or 4.3% mainly due to a 6.4% increase in the average number of operating aircraft in 2017 compared to 2016 as well as a 5.0% increase in departures.
Salaries, Wages and Benefits
Salaries, wages and benefits increased $127 million, or 10.0%, for the nine months ended September 30, 2017 compared to the same period in 2016. The primary drivers were the compensation structure changes previously discussed, higher labor costs due to challenging conditions in the operation, as well as additional headcount, partially offset by lower profit sharing. Our average number of full-time equivalent crewmembers in the nine months ended September 30, 2017 increased by 9.9% compared to the same period in 2016.
Depreciation and Amortization
Depreciation and amortization increased $39 million, or 13.2%, for the nine months ended September 30, 2017 compared to the same period in 2016, primarily driven by a 6.4% increase in the average number of aircraft operating during the nine months ended September 30, 2017 compared to the same period in 2016.
Maintenance Materials and Repairs
Maintenance materials and repairs increased $40 million, or 9.3%, for the nine months ended September 30, 2017 compared to the same period in 2016, primarily driven by increased flight hours on our engine flight-hour based maintenance repair agreements and by the number of airframe heavy maintenance repairs.
Other Operating Expenses
Other operating expenses increased $41consist of the following categories: outside services, airport expenses (including expenses related to ground handling, skycap, security, and catering services), personnel expenses, professional and legal fees, onboard supplies, shop and office supplies, bad debts, communication costs and taxes other than payroll and fuel taxes.
Other operating expenses increased $22 million, or 6.3%, for the ninethree months ended September 30, 2017March 31, 2024 compared to the same period in 2016, primarily2023 due in part to an increase in airportinformation technology service costs, outside services, and on-board supplies resulting from an increased numberpersonnel expenses.
Special Items
For the three months ended March 31, 2024, special items included the following:
•$532 million relating to Spirit-related costs;
•$15 million relating to voluntary opt-out costs; and
•$15 millionrelating to Embraer E190 fleet transition costs.
For the three months ended March 31, 2023, special items included the following:
•$95 million relating to union contract costs; and
•$17 million relating to Spirit-related costs.

(1) Refer to "Regulation G Reconciliation of customers flown.Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.

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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Operational Statistics
The following table sets forth our operating statistics for the three and nine months ended September 30, 2017March 31, 2024 and 2016:2023:
Three Months Ended March 31,Year-over-Year Change
(percent changes based on unrounded numbers)20242023%
Operational Statistics
Revenue passengers (thousands)9,584 10,192 (6.0)
Revenue passenger miles (RPMs) (millions)13,002 13,375 (2.8)
Available seat miles (ASMs) (millions)16,313 16,769 (2.7)
Load factor79.7 %79.8 %(0.1)pts
Aircraft utilization (hours per day)10.2 11.1 (8.1)
Average fare$214.39 $214.07 0.1 
Yield per passenger mile (cents)15.80 16.31 (3.1)
Passenger revenue per ASM (cents)12.60 13.01 (3.2)
Operating revenue per ASM (cents)13.54 13.88 (2.5)
Operating expense per ASM (cents)17.95 15.32 17.1 
Operating expense per ASM, excluding fuel (1) (cents)
10.57 9.87 7.1 
Departures79,700 87,481 (8.9)
Average stage length (miles)1,279 1,199 6.7 
Average number of operating aircraft during period285 278 2.5 
Average fuel cost per gallon$2.97 $3.59 (17.3)
Fuel gallons consumed (millions)210 219 (3.8)
Average number of full-time equivalent crewmembers20,222 20,536 (1.5)
 Three Months Ended September 30, Year-over-Year Change Nine Months Ended September 30, Year-over-Year Change
(percent changes based on unrounded numbers)2017 2016 % 2017 2016 % 
Operational Statistics             
Revenue passengers (thousands)10,227
 9,953
 2.8
  30,251
 28,731
 5.3
 
Revenue passenger miles (RPMs) (millions)12,180
 11,905
 2.3
  35,712
 34,434
 3.7
 
Available seat miles (ASMs) (millions)14,306
 13,796
 3.7
  42,131
 40,421
 4.2
 
Load factor85.1% 86.3% (1.2)pts 84.8% 85.2% (0.4)pts
Aircraft utilization (hours per day)11.8
 12.2
 (3.3)  11.9
 12.2
 (2.2) 
              
Average fare$158.68
 $157.87
 0.5
  $156.17
 $157.88
 (1.1) 
Yield per passenger mile (cents)13.32
 13.20
 1.0
  13.23
 13.17
 0.4
 
Passenger revenue per ASM (cents)11.34
 11.39
 (0.4)  11.21
 11.22
 (0.1) 
Operating revenue per ASM (cents)12.67
 12.55
 0.9
  12.48
 12.35
 1.1
 
Operating expense per ASM (cents)10.50
 9.99
 5.2
  10.56
 9.83
 7.4
 
Operating expense per ASM, excluding fuel(1)
8.07
 7.86
 2.7
  8.19
 7.89
 3.7
 
              
Departures90,021
 86,801
 3.7
  265,980
 253,325
 5.0
 
Average stage length (miles)1,069
 1,091
 (2.0)  1,072
 1,099
 (2.5) 
Average number of operating aircraft during period234.3
 219.6
 6.7
  231.7
 217.8
 6.4
 
Average fuel cost per gallon, including fuel taxes$1.69
 $1.48
 14.6
  $1.66
 $1.37
 21.9
 
Fuel gallons consumed (millions)205
 198
 3.3
  598
 573
 4.3
 
Average number of full-time equivalent crewmembers       17,051
 15,521
 9.9
 
(1) ReferWe expect our operating results to significantly fluctuate from quarter-to-quarter in the future as a result of various factors, many of which are outside of our “Regulation G Reconciliation” note below for more information on this non-GAAP measure.
Althoughcontrol. For example, air traffic controller shortages in the Northeast and Florida continue to cause disruptions in the industry, resulting in the FAA waiving the minimum usage requirement and permitting us to voluntarily turn in up to 10% of our slots in the New York area to help protect our operations. Even with the flight cutbacks, we experienced revenue growth throughout 2016 as well asand continue to expect challenges in the first nine monthsoperating environment. Consequently, we believe quarter-to-quarter comparisons of 2017, this trendour operating results may not continue.necessarily be meaningful; you should not rely on our results for any one quarter as an indication of our future performance. Except for the uncertainty related to the directioncost of aircraft fuel, prices, we expect our expenses to continue to increase as we acquire additional aircraft, as our fleet ages, and as we expand the frequency of flights in existing markets as well as enter into new markets. In addition, we expect
Operational challenges impacted our operating results to significantly fluctuate from quarter-to-quarterbusiness in the future as a resultfirst quarter of various factors, many of which are outside2024. These challenges include disruptions in our supply chains and those of our control. Consequently, we believe quarter-to-quarter comparisonsbusiness partners, leading to aircraft delivery delays. Additionally, reliability challenges with some of our operating results may not necessarily be meaningful; you should not rely on our results for any one quarter as an indication of our future performance.aircraft engines using new technology have led to grounded aircraft events. These challenges have resulted - and are expected to continue to result - in flight delays and cancellations.
LIQUIDITY AND CAPITAL RESOURCES
The airline business is capital intensive. Our ability to successfully execute our growth plans is largely dependent on the continued availability of capital on attractive terms. In addition, our ability to successfully operate our business depends on maintaining sufficient liquidity. We believe we have adequate resources from a combination of cash and cash equivalents, investment securities on hand, and two available lines of credit. Additionally, as of September 30, 2017, we had 110our unencumbered aircraft and 37 unencumbered spare engines which we believeassets could be an additional source of liquidity, if necessary.
At March 31, 2024, we had unrestricted cash, cash equivalents, short-term investments, and long-term marketable securities of approximately $1.7 billion, which we believe will be sufficient to satisfy our liquidity needs for at least the next twelve months from the date of this Report, and we expect to meet our long-term liquidity needs with our projected cash from operations, available lines of credit and debt financing.
(1) Refer to "Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
We believe a healthy liquidity position is a crucial toelement of our ability to weather any part of the economic cycle while continuing to execute on our plans for profitable growth and increased returns. Our goal is to continue to be diligent with our liquidity, maintainingmaintain financial flexibility, and allowing forbe prudent with capital spending.
At September 30, 2017, we had unrestricted cash and cash equivalents of $394 million and short-term investments of $420 million. We believe our current level of unrestricted cash, cash equivalents and short-term investments of approximately 12% of trailing twelve months revenue, combined with our available lines of credit and portfolio of unencumbered assets provides us with a strong liquidity position and the potential for higher returns on cash deployment.

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Analysis of Cash Flows
Operating Activities
We rely primarily on operating cash flows to provide working capital for current and future operations. Cash flows from operating activities were $1.1 billion $204 million and $1.3 billion$405 million for the ninethree months ended September 30, 2017March 31, 2024 and 2016,2023, respectively. Lower earnings, principally driven by an increase in aircraft fuel expenses and higher labor costs and maintenance, materials and repairs expenses, partially offset by higher operating revenues, contributed to our reductionThe decrease in operating cash flows.flow is driven by the change in working capital and Spirit merger termination.
Investing Activities
During the ninethree months ended September 30, 2017,March 31, 2024, flight equipment capital expenditures related to our purchase of flight equipment included $476$386 million related to the purchase of nine Airbus A321 aircraft and three Airbus A320 lease buyouts, $114spare engines as well as aircraft interior modifications. Flight capital expenditures also included $20 million in work-in-progress relating to flight equipment, $90 million for flight equipment deposits, and $47 million for spare part purchases. Other property and equipment capital expenditures also included ground equipment purchases and facilities improvements for $68$21 million. Investing activities for the current year period also included the$93 million in net proceeds of $208from investment securities, $39 million from the sale of investment securities.in pre-delivery deposit payments for future aircraft deliveries and $22 million in Spirit shareholder payments.
During the ninethree months ended September 30, 2016,March 31, 2023, flight equipment capital expenditures related to our purchase of flight equipment included $296$131 million related to the purchase of seven Airbus A321 aircraft $67and spare engines as well as aircraft interior modifications. Flight capital expenditures also included $10 million in work-in-progress relating to flight equipment, 118 million for flight equipment deposits, and $12 million for spare part purchases. Other property and equipment capital expenditures also included ground equipment purchases and facilities improvements for $105$31 million. Investing activities also included $165 million in net proceeds from investment securities and $33 million in Spirit shareholder payments.
Financing Activities
Financing activities for the ninethree months ended September 30, 2017March 31, 2024 primarily consisted of proceeds from sale-leaseback transactions of $332 million partially offset by $58 million in payments relating to share repurchase activities which totaled $380 million and  scheduled maturities of $138 million relating toon our outstanding debt and capitalfinance lease obligations.
Financing activities for the ninethree months ended September 30, 2016March 31, 2023 primarily consisted of the scheduled maturities proceeds from a sale-leaseback transaction of $148$38 million, relating tooffset by $109 million in payments on our outstanding debt and capitalfinance lease obligations.
Working Capital
We had a working capital deficit of $1.0$1.9 billion and $811 million$1.5 billion at September 30, 2017March 31, 2024 and December 31, 2016,2023, respectively. Working capital deficits can be customary in the airline industry because air traffic liability is classified as a current liability. Our working capital deficit increased by $217$390 million due to several factors, including an overall decrease in cash and short-term investments, an increase in our air traffic liability and an increase in scheduled short-term debt and capital lease commitmentsother accrued liabilities.
We expect to meet our obligations as they become due through available cash, investment securities, and internally generated funds, supplemented, as necessary, by financing activities which may be available to us. We expect to generate positive working capital through our operations. However, we cannot predict what the effect on our business might be from future developments related to the extremely competitive environment in which we operate, or from events beyond our control, such as volatile fuel prices, economic conditions, weather-related disruptions, airport infrastructure challenges, the spread of infectious diseases, the impact of other airline bankruptcies, restructurings or consolidations, U.S. or international military actions, or acts of terrorism.terrorism, or other external geopolitical events and conditions. We believe the working capitalthere is sufficient liquidity available to us will be sufficient to meet our cash requirements for at least the next 12 months.
As part of our efforts to effectively manage our balance sheet and improve Return on Invested Capital, or ROIC, we expect to continue to actively manage our debt balances. Our approach to debt management includes managing the mix of fixed and floating rate debt, annual maturities of debt and the weighted average cost of debt. We intend to continue to opportunistically pre-pay outstanding debt when market conditions and terms are favorable as well as when excess liquidity is available. Additionally, our unencumbered assets allow some flexibility in managing our cost of debt and capital requirements.
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PART I. FINANCIAL INFORMATION

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Contractual Obligations
Our noncancelablematerial cash requirements for known contractual and other obligations at September 30, 2017, includeas of March 31, 2024 includes the following (in millions):
Remainder of 20242025202620272028ThereafterTotal
Debt and finance lease obligations (1)
$442 $507 $1,238 $474 $561 $3,193 $6,415 
Operating lease obligations118 116 92 86 74 365 851 
Flight equipment purchase obligations (2)
820 1,165 1,144 1,011 1,529 1,198 6,867 
Other obligations (3)
253 330 324 334 404 — 1,645 
Total$1,633 $2,118 $2,798 $1,905 $2,568 $4,756 $15,778 
 Payments due in
 Total 2017 2018 2019 2020 2021 Thereafter
Debt and capital lease obligations(1)
$1,464
 $67
 $245
 $255
 $209
 $187
 $501
Lease commitments1,226
 43
 169
 148
 128
 115
 623
Flight equipment purchase obligations7,622
 343
 814
 1,019
 1,350
 1,466
 2,630
Other obligations(2)
2,490
 373
 343
 322
 299
 204
 949
Total$12,802
 $826
 $1,571
 $1,744
 $1,986
 $1,972
 $4,703
The amounts stated above do not include additional obligations incurred as a result of financing activities executed after March 31, 2024.
(1) Includes actual interest and estimated interest for floating-rate debtdebt. Estimated floating rate is equal to Secured Overnight Financing Rate ("SOFR") plus a margin based on September 30, 2017 ratesMarch 31, 2024 rates.
(2) Amounts represent obligations based on the current delivery schedule set forth in our Airbus order book as of March 31, 2024.
(3) Amounts primarily include noncancelablenon-cancelable commitments for the purchase of goodsflight equipment maintenance, construction and servicesinformation technology.
As of September 30, 2017, we believeMarch 31, 2024, we are in compliance with the covenants of our debt and lease agreements. We have approximately $29$59 million of restricted cash pledged under standby letters of credit related to certain leases that will expire at the end of the related lease terms. Approximately 61% of our owned property and equipment and intangible assets at net book value were pledged or committed to be pledged as security under various loan agreements.
As of September 30, 2017, we operated aMarch 31, 2024, our operating fleet consisted of 46 Airbus A321 aircraft, 130 (1):
Aircraft TypeAircraft Count
Airbus A22029 
Airbus A32011 
Airbus A320 Restyled119 
Airbus A32128 
Airbus A321 with Mint®35 
Airbus A321neo16 
Airbus A321neo with Mint®8 
Airbus A321neoLR with Mint®9 
Embraer E190 (2)
32 
Total287
(1) This table includes aircraft that have been temporarily removed from service, but are expected to return to operation in the future.
(2) Embraer E190 excludes 10 permanently parked owned aircraft and 60 Embraer 190 aircraft. 6 parked aircraft awaiting lease return.
Of our fleet, 186 244 are owned by us, of which 110 are unencumbered, 4443 are leased under operating leases, and sixnone are leased under capitalfinance leases. Our owned aircraft include aircraft associated with sale-leaseback transactions that did not qualify as sales for accounting purposes. As of September 30, 2017,March 31, 2024, the average age of our operating fleet was 9.3 years and our firmwas 12.2 years.
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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Our committed future aircraft order wasdeliveries as follows:of March 31, 2024 are as follows (1):
YearAirbus A220Airbus A321neoTotal
Remainder of 202415 4 19 
202520 5 25 
202620 4 24 
20275 9 14 
20287 16 23 
Thereafter4 14 18 
Total (2)
71 52 123 
Year Airbus A320neo Airbus A321 Airbus A321neo Embraer 190 Total
2017 — 6 — — 6
2018 — 11 — — 11
2019 — — 13 — 13
2020 6 — 7 10 23
2021 16 — 4 7 27
2022 3 — 17 7 27
2023 — — 14 — 14
2024 — — 5 — 5
Total 25 17 60 24 126
(1) Our committed future aircraft deliveries are subject to change based on modifications to the contractual agreements or changes in the delivery schedules.
(2) In addition, we have options to purchase an additional 20 A220-300 aircraft.
Committed expenditures for our firm aircraft and spare engines include estimated amounts for contractual price escalations and predeliverypre-delivery deposits. We expect to meet our predeliverypre-delivery deposit requirements for our aircraft by paying cash or by using short-term borrowing facilities for deposits generally required six to 24 months prior to delivery. Any predeliverypre-delivery deposits paid by the issuance of notes are fully repaid at the time of delivery of the related aircraft.
WeDepending on market conditions, we anticipate using a mix of cash and debt financing for the remaining aircraft scheduled for delivery in 2017, depending on market conditions. For deliveries after 2017, although2024. Although we believe debt and/or lease financing should be available to us, we cannot give any assurance that we will be able to secure financing on attractive terms, if at all. While these financings may or may not result in an increase in liabilities on our balance sheet, our fixed costs will increase regardless of the financing method ultimately chosen. To the extent we cannot secure financing on terms we deem attractive, we may be required to pay in cash, further modify our aircraft acquisition plans, or incur higher than anticipated financing costs.
Capital expenditures for non-aircraft such as facility improvements are expected to be between approximately $100 million and $120 million for the full year 2017.
Off-Balance Sheet Arrangements
NoneThere have been no material changes to off-balance sheet arrangements from the information provided in Item 7. Management's Discussion and Analysis of our operating lease obligations are reflected on our balance sheet. Although someFinancial Condition and Results of our aircraft lease arrangements are with variable interest entities, as defined by the Consolidations topic of the Codification, none of them require consolidationOperations-Off Balance Sheet Arrangements included in our financial statements. Our decision to finance these aircraft through operating leases rather than through debt was based on an analysis of the cash flows and tax consequences of each financing alternative and a consideration of liquidity implications. We are responsible for all maintenance, insurance and other costs associated with operating these aircraft; however, we have not made any residual value or other guarantees to our lessors.

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We have determined that we hold a variable interest in, but are not the primary beneficiary of, certain pass-through trusts. The beneficiaries of these pass-through trusts are the purchasers of equipment notes issued by us to finance the acquisition of aircraft. They maintain liquidity facilities whereby a third party agrees to make payments sufficient to pay up to 18 months of interest on the applicable certificates if a payment default occurs.
We have also made certain guarantees and indemnities to other unrelated parties that are not reflected on our balance sheet, which we believe will not have a significant impact on our results of operations, financial condition or cash flows. We have no other off-balance sheet arrangements.2023 Form 10-K.
Critical Accounting Policies and Estimates
There have been no material changes to our critical accounting policies and estimates from the information provided in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Critical Accounting Policies and Estimates included in our 20162023 Form 10-K.
Forward-Looking Information
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This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act, which represent our management's beliefs and assumptions concerning future events. When used in this document and in documents incorporated herein by reference, the words “expects,” “plans,” “anticipates,” “indicates,” “believes,” “forecast,” “guidance,” “outlook,” “may,” “will,” “should,” “seeks,” “targets” and similar expressions are intended to identify forward-looking statements. Forward-looking statements involve risks, uncertainties and assumptions, and are based on information currently available to us. Actual results may differ materially from those expressed in the forward-looking statements due to many factors, including, without limitation, our extremely competitive industry; volatility in financial and credit markets which could affect our ability to obtain debt and/or lease financing or to raise funds through debt or equity issuances; volatility in fuel prices, maintenance costs and interest rates; our significant obligations and substantial indebtedness; our ability to implement our growth strategy; our ability to attract and retain qualified personnel and maintain our culture as we grow; our reliance on high daily aircraft utilization; our dependence on the New York and Boston metropolitan markets and the effect of increased congestion in these markets; our reliance on automated systems and technology; reputational and business risk from information security breaches or cyber-attacks; our being subject to potential unionization, work stoppages, slowdowns or increased labor costs; our reliance on a limited number of suppliers; our presence in some international emerging markets that may experience political or economic instability or may subject us to legal risk; changes in or additional government regulation; changes in our industry due to other airlines' financial condition; acts of war or terrorism; global economic conditions or an economic downturn leading to a continuing or accelerated decrease in demand for air travel; the spread of infectious diseases; adverse weather conditions or natural disasters; and external geopolitical events and conditions. It is routine for our internal projections and expectations to change as the year or each quarter in the year progresses, and therefore it should be clearly understood that the internal projections, beliefs and assumptions upon which we base our expectations may change prior to the end of each quarter or year.
Given the risks and uncertainties surrounding forward-looking statements, you should not place undue reliance on these statements. You should understand that many important factors, in addition to those discussed or incorporated by reference in this Report, could cause our results to differ materially from those expressed in the forward-looking statements. Potential factors that could affect our results include, in addition to others not described in this Report, those described in Item 1A of our 2016 Form 10-K under “Risks Related to JetBlue” and “Risks Associated with the Airline Industry” and our other filings with the SEC. In light of these risks and uncertainties, the forward-looking events discussed in this Report might not occur.
Where You Can Find Other Information
Our website is www.jetblue.com. Information contained on our website is not incorporated into this Report. Information we file or furnish with the U.S. Securities and Exchange Commission, or SEC, including our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to or exhibits included in these reports are available for download, free of charge, on our website soon after such reports are filed with or furnished to the SEC. Our SEC filings, including exhibits filed therewith, are also available at the SEC’s website at www.sec.gov. You may obtain and copy any document we file or furnish with the SEC at the SEC’s public reference room at 100 F Street, NE, Room 1580, Washington, D.C. 20549. You may obtain information on the operation of the SEC’s public reference facilities by calling the SEC at 1-800-SEC-0330. You may request copies of these documents, upon payment of a duplicating fee, by writing to the SEC at its principal office at 100 F Street, NE, Room 1580, Washington, D.C. 20549.


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PART I. FINANCIAL INFORMATION

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
REGULATION G RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
We sometimes usereport our financial results in accordance with GAAP; however, we present certain non-GAAP financial measures in this Report. Non-GAAP financial measures are financial measures that are derived from the condensed consolidated financial statements, but that are not presented in accordance with generally accepted accounting principles in the U.S., or GAAP. We believepresent these non-GAAP financial measures because we believe they provide useful supplemental information that enables a meaningful comparison of our results to others in the airline industry and our prior year results. Investors should consider these non-GAAP financial measures in addition to, and not as a substitute for, our financial performance measures prepared in accordance with GAAP. Further, our non-GAAP information may be different from the non-GAAP information provided by other companies. The information below provides an explanation of each non-GAAP financial measure presented in this Report and shows a reconciliation of each such non-GAAP financial measure to its most directly comparable GAAP financial measure.
Operating Expenses, excluding Fuel, Other Non-Airline Operating Expenses, and Special Items ("Operating Expenses ex-fuel") and Operating Expense ex-fuel per Available Seat Mile excluding fuelex-fuel ("CASM ex-fuel")
Operating expensesExpense per available seat mile, or CASM,Available Seat Mile ("CASM") is a common metric used in the airline industry. Our CASM for the relevant periods are summarized in the table below. We exclude aircraft fuel, and related taxes, and operating expenses related to other non-airline expenses,businesses, such as JetBlue Technology Ventures and JetBlue Travel Products, and special items from total operating expenses to determine Operating Expenses ex-fuel, which is a non-GAAP financial measure, and we exclude the same items from CASM ex-fuel. to determine CASM ex-fuel, which is also a non-GAAP financial measure. We believe the impact of these special items distorts our overall trends and that our metrics are more comparable with the presentation of our results excluding such impact.
We believe that Operating Expenses ex-fuel and CASM ex-fuel providesare useful for investors withbecause they provide investors the ability to measure our financial performance excluding items that are beyond our control, such as fuel costs, which are subject to many economic and political factors, beyond our control, oras well as items that are not related to the generation of an available seat mile, such as operating expense related to othercertain non-airline expenses.businesses and special items. We believe thisthese non-GAAP measure ismeasures are more indicative of our ability to manage airline costs and isare more comparable to measures reported by other major airlines.
For the three months ended March 31, 2024, special items included Spirit-related costs, voluntary opt-out costs, and Embraer E190 fleet transition costs. Please refer to Note 11 in our condensed consolidated financial statements included in Part 1, Item 1 of this Report.
For the three months ended March 31, 2023, special items included union contract costs and Spirit-related costs.
The table below provides a reconciliation of our total operating expenses ("GAAP measure") to Operating Expenses ex-fuel, and our CASM to CASM ex-fuel for the periods presented.

NON-GAAP FINANCIAL MEASURE
RECONCILIATION OF OPERATING EXPENSE AND OPERATING EXPENSE PER ASM (CASM), EXCLUDING FUEL
Three Months Ended March 31,
Three Months Ended March 31,Cents per ASM
($ in millions; per ASM data in cents; percent changes based on unrounded numbers)20242023Percent Change20242023Percent Change
Total operating expenses$2,928$2,57014.0 17.95 15.32 17.1 
Less:
Aircraft fuel625785(20.4)3.84 4.68 (18.1)
Other non-airline expenses1718(4.4)0.10 0.09 (1.8)
Special items562112
NM (1)
3.44 0.68 NM
Operating expenses, excluding fuel$1,724$1,6554.2 10.57 9.87 7.1 
(1) Not meaningful or greater than 100% change.

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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Reconciliation of Operating Expense per ASM, excluding fuel
(in millions; per ASM data in cents)Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
$ per ASM $ per ASM $ per ASM $ per ASM
Total operating expenses$1,503
 10.50
 1,378
 9.99
 4,448
 10.56
 3,975
 9.83
Less:
               
   Aircraft fuel and related taxes347
 2.42
 293
 2.13
 994
 2.36
 782
 1.94
   Other non-airline expenses1
 0.01
 —
 —
 3
 0.01
 1
 —
Operating expenses, excluding fuel
$1,155
 8.07
 1,085
 7.86
 3,451
 8.19
 3,192
 7.89
Operating Expense, Operating Loss, Adjusted Operating Margin, Pre-tax Loss, Adjusted Pre-tax Margin, Net Loss and Loss per Share, excluding Special Items and Gain (Loss) on Investments
Our GAAP results in the applicable periods were impacted by credits and charges that were deemed special items.

For the three months ended March 31, 2024, special items included Spirit-related costs, voluntary opt-out costs, and Embraer E190 fleet transition costs. Please refer to Note 11 in our condensed consolidated financial statements included in Part 1, Item 1 of this Report.
For the three months ended March 31, 2023, special items included union contract costs and Spirit-related costs.
Certain net gains and losses on our investments were also excluded from our March 31, 2024 and 2023 non-GAAP     results.
We believe the impact of these items distort our overall trends and that our metrics are more comparable with the presentation of our results excluding the impact of these items. The table below provides a reconciliation of our GAAP reported amounts to the non-GAAP amounts excluding the impact of these items for the periods presented.




























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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
NON-GAAP FINANCIAL MEASURE
RECONCILIATION OF OPERATING EXPENSE, OPERATING LOSS, ADJUSTED OPERATING MARGIN, PRE-TAX LOSS, ADJUSTED PRE-TAX MARGIN, NET LOSS, LOSS PER SHARE, EXCLUDING SPECIAL ITEMS AND GAIN (LOSS) ON INVESTMENTS
Three Months Ended March 31,
(in millions except percentages)20242023
Total operating revenues$2,209 $2,328 
RECONCILIATION OF OPERATING EXPENSE
Total operating expenses$2,928 $2,570 
Less: Special items562 112 
Total operating expenses excluding special items$2,366 $2,458 
Percent change(3.7)%
RECONCILIATION OF OPERATING LOSS
Operating loss$(719)$(242)
Add back: Special items562 112 
Operating loss excluding special items$(157)$(130)
RECONCILIATION OF ADJUSTED OPERATING MARGIN
Operating margin(32.6)%(10.4)%
Operating loss excluding special items$(157)$(130)
Total operating revenues2,209 2,328 
Adjusted operating margin(7.1)%(5.6)%
RECONCILIATION OF PRE-TAX LOSS
Loss before income taxes$(767)$(266)
Add back: Special items562 112 
Less: Gain (loss) on investments, net(22)3 
Loss before income taxes excluding special items and gain (loss) on investments, net$(183)$(157)
RECONCILIATION OF ADJUSTED PRE-TAX MARGIN
Pre-tax margin(34.7)%(11.4)%
Loss before income taxes excluding special items$(183)$(157)
Total operating revenues2,209 2,328 
Adjusted pre-tax margin(8.3)%(6.8)%
RECONCILIATION OF NET LOSS
Net loss$(716)$(192)
Add back: Special items562 112 
Less: Income tax benefit related to special items7 29 
Less: Gain (loss) on investments, net(22)3 
Less: Income tax benefit (expense) related to gain (loss) on investments, net6 (1)
Net loss excluding special items and gain (loss) on investments, net$(145)$(111)

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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
NON-GAAP FINANCIAL MEASURE
RECONCILIATION OF OPERATING EXPENSE, OPERATING LOSS, ADJUSTED OPERATING MARGIN, PRE-TAX LOSS, ADJUSTED PRE-TAX MARGIN, NET LOSS, LOSS PER SHARE, EXCLUDING SPECIAL ITEMS AND GAIN (LOSS) ON INVESTMENTS (CONTINUED)
Three Months Ended March 31,
CALCULATION OF LOSS PER SHARE20242023
Loss per common share
Basic$(2.11)$(0.58)
Add back: Special items1.65 0.34 
Less: Income tax benefit related to special items0.02 0.09 
Less: Gain (loss) on investments, net(0.06)0.01 
Less: Income tax benefit related to gain (loss) on investments, net0.01 — 
Basic excluding special items and gain (loss) on investments, net$(0.43)$(0.34)
Diluted$(2.11)$(0.58)
Add back: Special items1.65 0.34 
Less: Income tax benefit related to special items0.02 0.09 
Less: Gain (loss) on investments, net(0.06)0.01 
Less: Income tax benefit related to gain (loss) on investments, net0.01 — 
Diluted excluding special items and gain (loss) on investments, net$(0.43)$(0.34)



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PART I. FINANCIAL INFORMATION
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
ThereExcept as described below, there have been no material changes in market risks from the information provided in Item 7A. Quantitative and Qualitative Disclosures About Market Risk included in our 20162023 Form 10-K, except as follows:10-K.
Aircraft Fuel
Our results of operations are affected by changes in the price and availability of aircraft fuel. Market risk is estimated as a hypothetical 10% increase in the September 30, 2017March 31, 2024 cost per gallon of fuel. Based on projected fuel consumption for the next 12 months, including the impact of our hedging position, such an increase would result in an increase to aircraft fuel expense of approximately $159 $262 million. As of September 30, 2017March 31, 2024, we hadhave hedged approximately 10%27% of our projected 2017fuel requirements. All fuel hedge contracts existing at September 30, 2017 settle by December 31, 2017. The financial derivative instrument agreements we have with our counterparties may require us to fund all, or a portionrequirement for the second quarter of outstanding loss positions related to these contracts prior to their scheduled maturities. The amount2024, 3% for the third quarter of collateral posted, if any, is periodically adjusted based on2024, and 5% for the fair valuefourth quarter of the hedge contracts. Refer to Note 6 in our unaudited condensed consolidated financial statements, included in Part I, Item 1 of this Report, for additional information.2024.
Interest

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Our earnings are affected by changes in interest rates due to the impact those changes have on interest expense from variable-rate debt instruments and on interest income generated from our cash and investment balances. The interest rate is fixed for $1.1$4.6 billion of our debt and capitalfinance lease obligations, with the remaining $0.2 billion$395 million having floating interest rates. As of September 30, 2017,March 31, 2024, if interest rates were on average 100 basis points higher in 2017year-over-year, our annual interest expense would increase by approximately $2$4 million. This amount is determined by considering the impact of the hypothetical change in interest rates on our variable rate debt and capital leases.debt.
If interest rates were to average 10%100 basis points lower in 20172024 than they didwere during 2016,2023, our interest income from cash and investment balances would remain relatively constant. These amounts aredecrease by approximately $7 million. This amount is determined by considering the impact of the hypothetical change in interest rates on the balances of our cash equivalentsmoney market funds and investment securities balances at September 30, 2017 and December 31, 2016.short-term, interest-bearing investments for the trailing twelve-month period.

ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as defined in RuleRules 13a-15(e) and Rule 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed by us in reports that we file under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information required to be disclosed by us in reports that we file under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer or CEO,("CEO"), and our Chief Financial Officer or CFO,("CFO"), as appropriate, to allow timely decisions regarding required disclosure. Management, with the participation of our CEO and CFO, performed an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of September 30, 2017.March 31, 2024. Based on that evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of September 30, 2017.March 31, 2024.
Changes in Internal Control Over Financial Reporting
There were no changes in the Company’sour internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) identified in connection with the evaluation of our controls performed during the fiscal quarter ended September 30, 2017,March 31, 2024 that have materially affected, or are reasonably likely to materially affect, the Company’sour internal control over financial reporting.


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PART II. OTHER INFORMATION



ITEM 1. LEGAL PROCEEDINGS
In the ordinary course of our business, we are party to various legal proceedings and claims which we believe are incidental to the operation of our business.business. Refer to Note 5 in6 to our unaudited condensed consolidatedconsolidated financial statements included in Part I, Item 1 of this Report for additional information.

ItemITEM 1A. RISK FACTORS
Part I, Item 1A Risk Factors contained in"Risk Factors" of our 20162023 Form 10-K includes a discussion of our risk factors which are incorporated herein. For information on the termination of our planned merger with Spirit, refer to Note 12 to our condensed consolidated financial statements included in Part I, Item 1 of this Report. There werehave been no other material changes from the risk factors associated with our business previously disclosed in Part I, Item 1A “Risk Factors” of our 20162023 Form 10-K.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES, AND USE OF PROCEEDS, AND ISSUER PURCHASES OF EQUITY SECURITIES
In September 2015, the Board of Directors authorized a three-year share repurchase program starting in 2016, of up to $250 million worth of shares. This authorization replaced the Company's 2012 authorization. On December 7, 2016, the Board approved changes to our share repurchase program to increase the aggregate authorization to $500 million worth of shares, and extend the term of the program through December 31, 2019.None.
ITEM 5. OTHER INFORMATION
(a) None.
(b) None.
(c) During the three months ended September 30, 2017, we completed the repurchase program. During the three months ended September 30, 2017, the following shares were repurchasedMarch 31, 2024, no director or "officer" (as defined in Rule 16a-1(f) under the program (in millions, except for per share data):Exchange Act) of the Company adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of Regulation S-K.



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Period Total Number of Shares Purchased Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Plans Approximate Dollar Value of Shares that May Yet be Purchased Under the Plan or Program
July 2017 1.4
 
(1) 
 1.4
 $130
September 2017 6.9
 
(2) 
 6.9
 $—
Total 8.3
 
 8.3
 


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(1) On April 27, 2017, JetBlue entered into an ASR agreement with Goldman, Sachs & Co., or GS&Co., paying $150 million for an initial delivery of approximately 5.4 million shares. The term of the GS&Co. ASR concluded on July 24, 2017 with GS&Co. delivering approximately 1.4 million additional shares to JetBlue on July 27, 2017. A total of 6.8 million shares, at an average price of $21.99 per share, were repurchased under the agreement. The total number of shares repurchased by JetBlue was based on the volume weighted average price of JetBlue's common stock during the term of the GS&Co. agreement.

(2) On September 11, 2017, JetBlue entered into an ASR agreement with Morgan Stanley & Co. LLC, or Morgan Stanley, paying $130 million for an initial delivery of approximately 5.4 million shares. The term of the Morgan Stanley ASR concluded on September 26, 2017 with Morgan Stanley delivering approximately 1.5 million additional shares to JetBlue on September 28, 2017. A total of 6.9 million shares, at an average price of $18.86 per share, were repurchased under the agreement. The total number of shares repurchased by JetBlue was based on the volume weighted average price of JetBlue's common stock during the term of the Morgan Stanley agreement.

ITEM 6. EXHIBITS
EXHIBIT INDEX

Exhibit NumberExhibit
10.1
10.2Exhibit10.1 to our Current Report on Form 8-K dated February 7, 2024).
10.1*10.3
10.4
10.5
10.6*^§
12.131.1*
31.1
Rule 13a-14(a)/15d-14(a) Certification of the Chief Executive Officer
31.231.2*
3232**
101.INSInline XBRL Instance Document - The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.
101.SCHInline XBRL Taxonomy Extension Schema Document
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document
101.LABInline XBRL Taxonomy Extension Labels Linkbase Document
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document
                  (*)104Cover Page Interactive Data File (embedded within the Inline XBRL document and contained in Exhibit 101)
*Filed herewith.
**Furnished herewith.
^Information in this exhibit identified by brackets is confidential and has been excluded because it (i) is not material and (ii) is the type of information that the registrant treats as private or confidential.
§Pursuant to a Confidential Treatment Request under Rule 24b-2 filed with and approved by the SEC, portionsItem 601(a)(5) of this exhibitRegulation S-K, schedules have been omitted.omitted and will be furnished on a supplemental basis to the Securities and Exchange Commission upon request.



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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
JETBLUE AIRWAYS CORPORATION
(Registrant)
Date:April 25, 2024By:/s/ Dawn Southerton
Date:October 27, 2017By:/s/     Alexander ChatkewitzDawn Southerton
Vice President, Controller and Chief
(Principal Accounting Officer (Principal Accounting Officer)





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