SkyWest Q2 2026 Earnings Call Transcript

On Thursday, SkyWest (NASDAQ: SKYW ) discussed second-quarter financial results during its earnings call. The full transcript is provided below. APIs provide real-time access to earnings call transcripts and financial data. Visit to learn more.

The full earnings call is available at Summary SkyWest Inc. 54, driven by strong demand despite higher fuel costs. The company announced a major agreement with American Airlines for the purchase and operation of 11 new E175s, with plans for a total of 34 additional E175s by the end of 2028. SkyWest Inc.

has reduced its debt by $1 billion since 2020 and announced a $250 million increase to its stock repurchase program. 9% adjusted completion rate on nearly 228,000 flights and recognition as one of America's Greatest Workplaces in 2026. Future guidance suggests a 5% increase in block hour production for 2026, with anticipated GAAP EPS around $11, and strong demand expected to continue in both the contract and prorate segments. Full Transcript OPERATOR Thank you for standing by and welcome to the SkyWest Inc.

second quarter 2026 results call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during that time, simply press star then the number one on your telephone keypad.

I would now like to turn the call over to Rob Simmons, Chief Financial Officer. Sir, please go ahead. Rob Simmons, Chief Financial Officer Thanks everyone for joining us on the call today. As the operator indicated, this is Rob Simmons, SkyWest Chief Financial Officer.

On the call with me today are Chip Childs, President and Chief Executive Officer, Wade Steele, SkyWest Airlines President and Chief Operating Officer, and Eric Woodward, Chief Accounting Officer. I'd like to start today by asking Eric to read the Safe Harbor. Then I will turn the time over to Chip for some comments. Following Chip, I will take us through the financial results.

Then Wade will discuss the fleet and related flying arrangements. Following Wade, we will have the customary Q&A session with our sell-side analysts. Eric Woodward, Chief Accounting Officer Today's discussion contains forward-looking statements that represent our current beliefs, expectations and assumptions regarding future events and are subject to risks and uncertainties. We assume no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.

Actual results will likely vary and may vary materially from those anticipated, estimated or projected for a number of reasons. Some of the factors that may cause such differences are included in our most recent Form 10-K and other reports and filings with the Securities and Exchange Commission. And now I'll turn the call over to Chip. Chip Childs, President and Chief Executive Officer Thank you Rob and Eric.

Good afternoon everyone and thank you for joining us on the call today. 54 per diluted share, for the second quarter of 2026. The second quarter's results include increased block hours and were affected by higher fuel costs impacting our prorate business. We are pleased to continue to see very strong demand both in our contract and prorate flying despite the higher fuel cost similar to our major partners.

That strong demand enabled us to offset about 60% of the fuel impact in the fare portion of our prorate business. Overall, our disciplined strategic choices and continued execution have strengthened our model and we remain well positioned to adapt quickly to respond to market demands better than anybody else. 9% adjusted completion on nearly 228,000 flights. We're incredibly proud to be named one of America's Greatest Workplaces in 2026 by Newsweek, as well as one of Fortune World's Most Admired Companies in 2026.

These accomplishments are made possible by SkyWest's more than 16,000 professionals and their commitment to excellence, and I want to thank them for their ongoing teamwork to deliver. Today we're pleased to announce an agreement with American for SkyWest to purchase and operate 11 new E175s with deliveries beginning this year, with 11 E175s expected during the second half of this year and 23 more in the next couple of years. We expect a total of 34 additional E175s by the end of 2028. Additionally, we continue converting CRJ700s to the customer favorite CRJ550 and we're very excited about the CRJ450 service beginning for United this fall.

With these transitions, we look forward to ultimately operating an all dual-class fleet. As I mentioned, prorate demand remains strong and we believe these fleet initiatives will benefit prorate growth. Our opportunities remain strong. We expect our growth will continue to come from three key areas: 1) solid demand from our major partners and our solid E175 order book; 2) underserved communities with our prorate business; and 3) execution of our fleet initiatives and conversions.

The free cash flow that we continue to generate is still directed toward fleet growth opportunities, debt reduction and share repurchase. We announced today that SkyWest Board of Directors has also approved a $250 million increase to our existing stock repurchase program. Our steadfast commitment to maintaining a strong balance sheet and liquidity benefits our employees, our partners and our shareholders. Additionally, we've continued to reduce our debt and we now have $1 billion less debt than we did at the end of 2020.

We also expect to have over 100 unencumbered E175s by the end of 2029. Overall, our debt ratios and leverage metrics are among the best in the industry. SkyWest continues to lead our industry in