Allegiant Travel Company

Reported Q2 2026 consolidated pretax income was $64.5 million, consolidated EPS was $2.19, operating margin was 9.2%, and EBITDA was nearly $158 million with EBITDA margin of nearly 17%. Stand-alone Allegiant revenue was $776 million, up 16.1% year over year, while stand-alone Allegiant TRASM was $0.1442, up 24.6% year over year. Stand-alone Allegiant nonfuel unit costs were $0.0817, up 6.4% year over year. On a combined basis, revenue was $943.5 million, available liquidity was $1.3 billion, total debt was $2.8 billion, net debt was $1.7 billion, and pro forma net leverage was approximately 2.6x. For Q3, management expects combined scheduled service capacity down approximately 5.5%, operating margin around 2% at the midpoint, and consolidated loss per share of approximately $0.50 based on an assumed share count of 27.3 million and fuel at $3.80 per gallon. For full-year 2026, guidance is now greater than $6 of EPS, assuming fuel at $3.80 in Q3 and $3.70 in Q4; earlier CEO commentary also framed full-year EPS as at least $6 per share assuming fuel at $3.75 for the remainder of the year. Capex outlook was updated to approximately $850 million for the full year.

Greg Anderson emphasized that the quarter showed the durability of the business model, pointing to record revenue, industry-leading operating margin, and strong operational execution despite closing the Sun Country acquisition. He framed Allegiant’s strategy around customer loyalty, low-utilization scheduling discipline, aircraft ownership, community position, and balance-sheet strength, saying the company is “better positioned today than at any point in our history.” He also highlighted new commercial initiatives, including Expedia distribution, higher cobrand remuneration, and the planned Allegiant First product, while stressing that capacity growth must be earned based on returns rather than pursued for its own sake.

Robert Neal focused on the financial outperformance versus the June 30 update, saying it was driven mainly by a $0.06 improvement in fuel price plus some nonfuel cost shifts. He cited Q2 stand-alone Allegiant nonfuel unit costs of $0.0817, up 6.4%, and noted pilot CBA-related wage and benefit pressure will create a modest back-half CASM ex headwind; he also said the third quarter should be the peak year-over-year increase in CASM ex. On capital and liquidity, he highlighted $188 million of Q2 capex, a revised full-year capex outlook of about $850 million, $1.3 billion of available liquidity, $275 million of pilot retention bonus cash payout coming soon, and confidence that no additional financing commitments are needed until next year. He also reiterated at least $140 million of run-rate synergies by 2029 and said the company expects to finish 2026 with remaining aircraft deliveries unencumbered.

Analysts pressed management on 2027 capacity growth, with the company saying it will not grow “for growth’s sake” and will let fuel and returns drive decisions; management described 2027 MAX deliveries as an option for growth rather than automatic growth. Questions also focused on Sun Country pilot attrition, and management said the issue is temporary, concentrated among newer MSP pilots, and being addressed by full training classes and capacity reductions in off-peak Twin Cities flying. On integration, management said the company is already cross-selling between brands, will keep reporting legacy Allegiant and Sun Country as segments for now, and expects a full code-share or fuller selling capability around the PSS timeframe, roughly 12 to 18 months out. Analysts also asked about OTA distribution and onboard beverages; management said Expedia is mainly a scalable customer-acquisition channel for a broad network and that complimentary beverages are not a material cost headwind this year.