Revenue from Contract with Customer

3 Months Ended

Mar. 31, 2025

Revenue from Contract with Customer [Abstract]

REVENUE

REVENUE

Ticket revenue is recorded as Passenger revenue, and represents the primary source of the Company's revenue. Also included in Passenger revenue is passenger ancillary revenue such as bag fees, on-board food and beverage, and certain revenue from Alaska's Mileage Plan program and Hawaiian's HawaiianMiles program. Loyalty program other revenue includes brand and marketing revenue from the Alaska Airlines Visa Signature and Hawaiian Airlines World Elite Mastercard co-branded credit cards and other partners, and certain interline loyalty program revenue, net of commissions. Cargo and other revenue consists of freight and mail revenue, services provided to Amazon under the Air Transportation Services Agreement (the ATSA), and other ancillary revenue products such as lounge membership and certain commissions.

The level of detail within the Company’s unaudited condensed consolidated statements of operations and in this note depict the nature, amount, timing, and uncertainty of revenue and how cash flows are affected by economic and other factors.

Passenger Revenue

Passenger revenue recognized in the unaudited condensed consolidated statements of operations:

	Three Months Ended March 31,
(in millions)	2025		2024
Passenger ticket revenue, net of taxes and fees	$	2,352	$	1,648
Passenger ancillary revenue	140		108
Loyalty program passenger revenue	316		248
Total Passenger revenue	$	2,808	$	2,004

Domestic passenger revenue includes operations in the U.S., including between the Hawaiian Islands (the Neighbor Island routes), and Canada. Latin America passenger revenue includes operations in Mexico, Costa Rica, Guatemala, Belize, and Bahamas. Pacific passenger revenue includes operations in the South Pacific, Australia, New Zealand, and Asia.

The table below presents the Company's passenger revenue by principal geographic region (as defined by the U.S. Department of Transportation):

	Three Months Ended March 31,
(in millions)	2025		2024
Domestic	$	2,462	$	1,805
Latin America	214		199
Pacific	132		—
Total Passenger revenue	$	2,808	$	2,004

Loyalty Program Revenue

Loyalty program revenue included in the unaudited condensed consolidated statements of operations:

	Three Months Ended March 31,
(in millions)	2025		2024
Loyalty program passenger revenue	$	316	$	248
Loyalty program other revenue	207		164
Total Loyalty program revenue	$	523	$	412

Cargo and Other Revenue

Cargo and other revenue included in the unaudited condensed consolidated statements of operations:

	Three Months Ended March 31,
(in millions)	2025		2024
Cargo revenue	$	57	$	28
Other revenue	65		36
Total Cargo and other revenue	$	122	$	64

Air Traffic Liability and Deferred Revenue

Passenger ticket and ancillary services liabilities

The Company recognized Passenger revenue of $904 million and $584 million from the prior year-end air traffic liability balance for the three months ended March 31, 2025 and 2024.

Loyalty program assets and liabilities

The Company records a receivable for amounts due from affinity card partners and from other partners as mileage credits are sold until the payments are collected. The Company had $111 million of such receivables as of March 31, 2025 and $118 million as of December 31, 2024.

The table below presents a roll forward of the total loyalty program liability:

	Three Months Ended March 31,
(in millions)	2025		2024
Total Deferred Revenue balance at January 1	$	3,256	$	2,603
Travel miles and companion certificate redemption - Passenger revenue	(307)		(234)
Miles redeemed on partner airlines - Loyalty program other revenue	(49)		(28)
Increase in liability for mileage credits issued	414		292
Total Deferred Revenue balance at March 31	$	3,314	$	2,633