Segment Reporting

9 Months Ended

Sep. 30, 2024

Segment Reporting

Segment Reporting

(6) Segment Reporting

The Company’s two reportable segments consist of (1) the operations of SkyWest Airlines and SWC (collectively, “SkyWest Airlines and SWC”) and (2) SkyWest Leasing activities.

The Company’s chief operating decision maker analyzes the profitability of operating new aircraft financed through the issuance of debt, including the Company’s E175 fleet, separately from the profitability of the Company’s capital deployed for ownership and financing of such aircraft. The SkyWest Airlines and SWC segment includes revenue earned under the applicable capacity purchase agreements attributed to operating such aircraft and the respective operating costs. The SkyWest Airlines and SWC segment also includes revenue and operating expenses attributed to

other flying agreements and airport services agreements. The SkyWest Leasing segment includes applicable revenue earned under the applicable capacity purchase agreements attributed to the ownership of new aircraft acquired through the issuance of debt and the respective depreciation and interest expense of such aircraft. The SkyWest Leasing segment also includes the activity of leasing regional jet aircraft and spare engines to third parties and other activities. The SkyWest Leasing segment’s total assets and capital expenditures include new aircraft acquired through the issuance of debt and assets leased to third parties. Additionally, aircraft removed from SkyWest Airlines’ operations and held for sale are included in the SkyWest Leasing segment.

The following represents the Company’s segment data for the three-month periods ended September 30, 2024 and 2023 (in thousands):

	Three months ended September 30, 2024
	SkyWest Airlines		SkyWest
	and SWC		Leasing		Consolidated
Operating revenues (1)	$	758,425	$	154,361	$	912,786
Operating expense		712,650		68,701		781,351
Depreciation and amortization expense		37,105		59,557		96,662
Interest expense		2,864		24,944		27,808
Segment profit (2)		42,911		60,716		103,627
Total assets (as of September 30, 2024)		2,673,084		4,283,516		6,956,600
Capital expenditures (including non-cash)		59,331		24,956		84,287

	Three months ended September 30, 2023
	SkyWest Airlines		SkyWest
	and SWC		Leasing		Consolidated
Operating revenues (1)	$	626,780	$	139,391	$	766,171
Operating expense		652,599		64,281		716,880
Depreciation and amortization expense		37,320		59,240		96,560
Interest expense		4,450		28,093		32,543
Segment profit (loss) (2)		(30,269)		47,017		16,748
Total assets (as of September 30, 2023)		2,557,850		4,501,268		7,059,118
Capital expenditures (including non-cash)		33,436		14,816		48,252

(1) Prorate revenue and airport customer service revenue are reflected in the SkyWest Airlines and SWC segment.

(2) Segment profit (loss) is equal to operating income less interest expense.

The following represents the Company’s segment data for the nine-month periods ended September 30, 2024 and 2023 (in thousands):

	Nine months ended September 30, 2024
	SkyWest Airlines		SkyWest
	and SWC		Leasing		Consolidated
Operating revenues (1)	$	2,117,018	$	466,500	$	2,583,518
Operating expense		2,032,115		200,822		2,232,937
Depreciation and amortization expense		110,217		179,129		289,346
Interest expense		9,595		77,008		86,603
Segment profit (2)		75,308		188,670		263,978
Total assets (as of September 30, 2024)		2,673,084		4,283,516		6,956,600
Capital expenditures (including non-cash)		144,588		24,956		169,544

	Nine months ended September 30, 2023
	SkyWest Airlines		SkyWest
	and SWC		Leasing		Consolidated
Operating revenues (1)	$	1,781,429	$	402,216	$	2,183,645
Operating expense		1,910,481		196,717		2,107,198
Depreciation and amortization expense		113,544		174,334		287,878
Interest expense		13,207		86,674		99,881
Segment profit (loss) (2)		(142,259)		118,825		(23,434)
Total assets (as of September 30, 2023)		2,557,850		4,501,268		7,059,118
Capital expenditures (including non-cash)		80,156		102,036		182,192

(1) Prorate revenue and airport customer service revenue are reflected in the SkyWest Airlines and SWC segment.

(2) Segment profit (loss) is equal to operating income less interest expense.