ALGT

The following discussion and analysis presents factors that had a material effect on our results of operations during the three and six months ended June 30, 2026 and 2025. Also discussed is our financial position as of June 30, 2026 and December 31, 2025. You should read this discussion in conjunction with our unaudited consolidated financial statements, including the notes thereto, appearing elsewhere in this Form 10-Q and our consolidated financial statements appearing in our annual report on Form 10-K for the year ended December 31, 2025. This discussion and analysis contains forward-looking statements. Please refer to the section below entitled “Cautionary Note Regarding Forward-Looking Statements” for a discussion of the uncertainties, risks and assumptions associated with these statements. Second Quarter 2026 Highlights Second quarter 2026 highlights include the following. Note that second quarter consolidated results include Sun Country operations only from and after the May 13, 2026 closing date of the transaction until the period end on June 30, 2026 (the "stub period"). •On May 13, 2026, we completed the acquisition of Sun Country just four months after announcing the transaction. •Consolidated total operating revenue of $943.5 million •Record Allegiant Air revenue of $776.2 million, up 16.1 percent year over year on 6.8 percent less capacity compared to the prior year quarter •Allegiant Air quarterly TRASM record of 14.42 ¢, up 24.6 percent year over year •Consolidated third-party products revenue of $45.8 million ◦Allegiant Air third-party products revenue of $44.5 million, up 32.2 percent year over year driven by cobrand remuneration •Available seat miles per gallon of fuel of 86.2 •Allegiant Air available seat miles per gallon of fuel of 85.4, up 0.8 percent year over year •$41.2 million in total Allegiant Air cobrand credit card remuneration received, up 23.6 percent year over year •Received proceeds of $874.7 million from debt financings during the quarter ◦Issued $650.0 million Senior Secured Notes due 2031 and used the proceeds to refinance $377.5 million of our Senior Secured Notes due 2027. ◦Received proceeds of $224.7 million from debt secured by aircraft and aircraft related assets Subsequent Events •In July, entered a 12-month exclusive distribution agreement with Expedia Group, Allegiant's first-ever authorized online travel agency ("OTA") partner, bringing the company's nonstop network to all of Expedia Group's U.S. brands and expanding reach to new leisure customers •In July, announced enhancements to the onboard experience, including complimentary inflight beverage service on all Allegiant flights beginning August 1, 2026, and Allegiant First, a new premium seating tier scheduled to debut on select aircraft in spring 2027 •On July 31, a new collective bargaining agreement with the International Brotherhood of Teamsters representing the Allegiant pilots was ratified with nearly 80 percent of votes in favor 27 AIRCRAFT The following table sets forth the aircraft in service and operated by us as of the dates indicated: June 30, 2026 December 31, 2025 Passenger service Airbus A320(1) 77 79 Airbus A319(2) 28 28 Boeing 737 MAX 8200 19 16 Boeing 737-800 (Sun Country)(3) 44 — Boeing 737-900ER (Sun Country) 3 — Total aircraft in passenger service 171 123 Boeing 737-800 in cargo service 22 — Aircraft held for operating lease Boeing 737-800(4) 1 — Boeing 737-900ER 2 — Total 196 123 (1)Includes 23 aircraft under finance lease and 9 aircraft under operating lease as of June 30, 2026 and December 31, 2025. Excludes one aircraft under operating lease as of June 30, 2026 and three aircraft under operating lease as of December 31, 2025, which were removed from service pending redelivery. (2)Excludes three aircraft under operating lease that were removed from service pending redelivery as of December 31, 2025. (3)Includes 12 aircraft under finance lease as of June 30, 2026. (4)Includes one aircraft under finance lease as of June 30, 2026. As of June 30, 2026, we are party to forward purchase agreements for 30 aircraft with deliveries expected between 2026 and 2028. Due to the heavy maintenance needs on certain aging Airbus airframes and capacity constraints at the maintenance, repair, and overhaul contractors, we identified aging airframes for early retirement to coincide with the delivery schedule for our 737 MAX aircraft provided in an amendment to our Boeing purchase agreement signed in September 2023. As of June 30, 2026, 17 airframes have been retired, with seven additional retirements scheduled between July 2026 and January 2027. The accelerated depreciation resulting from the revised estimated useful life of these aircraft is recorded as a special charge in the consolidated financial statements, including $1.3 million recognized in second quarter 2026. The engines from these aircraft will be retained for future overhaul cost mitigation and may be sold on an opportunistic basis if we determine the engine has no better economic use in our operating fleet. NETWORK As of June 30, 2026, and with the Sun Country acquisition, we were selling 675 routes versus 579 as of the same date in 2025. Network growth in the future will continue to be affected by high fuel prices, the timing of aircraft deliveries, aircraft in heavy maintenance, crew availability, airport construction and disruption, trends in domestic, leisure air travel demand and other factors such as macroeconomic conditions and geopolitical unrest. We have identified over 1,400 incremental domestic nonstop routes as opportunities for future network growth, of which over 75 percent currently have no non-stop service. The Allegiant Air network included 90 origination cities and 34 leisure destinations, as of June 30, 2026. Sun Country's largest and primary base is Minneapolis-Saint Paul International Airport ("MSP"), where it is the largest low-cost carrier and the second largest airline overall. Our MSP network served approximately 96 markets as of June 30, 2026. As of that date, Sun Country also served approximately 17 non-MSP markets and was selling a total of 109 routes. TRENDS Acquisition of Sun Country Airlines In May 2026, we closed on our agreement to acquire Sun Country. We believe the transaction aligns with our long-term strategic objectives and is expected to enhance our network breadth, operational flexibility, and ability to respond to demand shifts, while supporting the passenger and cargo operations of both airlines. The acquisition of Sun Country involves the integration of Sun Country’s business with our existing business, which is a complex, costly, and time-consuming process. Integration of the two companies is underway. 28 Both companies continue to operate as separate airlines under FAA rules. We have applied with the FAA for a single operating certificate which we currently expect will be obtained in 2028. Our ability to combine operations will be limited until we receive a single operating certificate and there are joint collective bargaining agreements in place with the various unionized work groups. Aircraft Fuel The cost of fuel, including refining costs and applicable crack spreads, remains volatile, and is influenced by numerous economic and geopolitical factors beyond our control or prediction, including geopolitical conflict and war. The recent escalation of hostilities in the Middle East has significantly impacted the market prices of products that are derived from crude oil. Our second quarter fuel expense was $307.7 million or $4.14 per gallon, which is 71.1 percent higher than the $2.42 per gallon we paid in second quarter 2025. As hostilities and uncertainty continue in the Middle East, we may continue to see significant increases in fuel costs that will materially impact our overall cost structure, operating results and profitability. We have not used financial derivative products to hedge against fuel price volatility, nor do we have any plans to do so in the future. Demand Environment Although air travel demand in the first half of 2026 has been strong, demand could be impacted in the future by macroeconomic, geopolitical, and airline industry events as it has in the past. During 2026, we strategically reduced off-peak day of week capacity and, in turn, increased peak day ASMs on fewer total aircraft year-over year. For Allegiant Air, this contributed to a 4.0 percentage point increase in load factor on a 6.2 percent decrease in scheduled service capacity in second quarter 2026. Our unique model is predicated around expanding and contracting capacity to meet seasonal leisure travel demands. We expect to continue to manage our peak period utilization as the demand environment allows. Commercial Initiatives In July 2026, we entered into a 12-month exclusive distribution agreement with Expedia Group to be Allegiant Air's first-ever authorized online travel agency ("OTA") partner, bringing our nonstop network to all of Expedia Group's U.S. brands and expanding reach to new leisure customers. Early results are promising, comprising of approximately 3% of bookings since the launch, with meaningfully more than half of those bookings from net new customers. We have also announced enhancements to our onboard experience. Beginning August 1, 2026, all Allegiant Air flights will include a complimentary inflight beverage service. We have also announced Allegiant First, a new premium seating tier scheduled to debut on future MAX deliveries, with service expected to begin in spring 2027. The introduction of Allegiant First will feature a redesigned and enhanced cabin with eight new Allegiant First seats with minimal impact to seating capacity. The new seating to be included on these future deliveries will feature improved seat cushions and in-seat power in all cabins. Boeing Agreement We have signed an agreement and amendments with Boeing to purchase 50 newly manufactured 737 MAX aircraft with options to purchase up to an additional 80 737 MAX aircraft. We have taken delivery of 20 737 MAX aircraft from this order through June 30, 2026, and all of these aircraft are currently in revenue service. We believe this new aircraft purchase is complementary with our low-cost strategy based on our intent to retain ownership of the aircraft, the longer useful life for depreciation purposes, and expected fuel savings and operational reliability from the use of these new aircraft. Our 737 MAX aircraft represented approximately 21% of our ASMs in second quarter 2026 as compared to 11% during the same period 2025. We currently expect seven aircraft to be delivered to us in the last six months of 2026 with the remaining aircraft under contract to be delivered in 2027 and 2028. Delays in aircraft deliveries could impact our ability to schedule additional growth when the demand environment allows. Union Negotiations The Allegiant Air pilots, who are represented by the International Brotherhood of Teamsters (“IBT”), ratified a new collective bargaining agreement on July 31, 2026. Among other new and modified terms, that new agreement provides for increased compensation and enhanced benefits to the Allegiant Air pilot group and contains improvements to the scheduling process for the Company. In addition, pursuant to the terms of that agreement, the pilot retention bonuses we have accrued will be payable no later than fourth quarter 2026. In 2026, the collective bargaining agreement between Allegiant Air and its air dispatchers represented by the IBT became amendable under the Railway Labor Act (“RLA”). The parties are engaged in negotiations over new and modified rates of pay, rules, and working conditions pursuant to the procedures set forth in Section 6 of the RLA. In 2025, the collective bargaining agreement covering the Sun Country pilots, who are represented by the Air Line Pilots Association (“ALPA”), became amendable. The parties continue to engage in negotiations under Section 6 of the RLA for a new agreement addressing rates of pay, rules, and working conditions for those employees. 29 In order to fully integrate the pre-merger union represented employee groups of Allegiant Air and Sun Country, we may be required to negotiate joint collective bargaining agreements covering the respective combined crafts or classes of employees. Where necessary, these negotiations will likely begin after a single post-merger representative has been certified by the National Mediation Board. 30 RESULTS OF OPERATIONS Items affecting comparability As the acquisition of Sun Country was completed on May 13, 2026, the three and six months ended June 30, 2026 include the results of Sun Country for the period May 13, 2026 through June 30, 2026, while the comparative periods in 2025 do not. Consolidated revenue and expenses all increased compared to the prior period due to the incorporation of Sun Country's operations into the Company. As a result, the below discussion of changes to our revenue and expenses compared to the prior year largely focuses on material factors independent of the acquisition. Comparison of three months ended June 30, 2026 to three months ended June 30, 2025 Operating Revenue Three Months Ended June 30, 2026 Three Months Ended June 30, 2025 Percent Change Operating Revenues (in thousands) Allegiant Air Sun Country* Consolidated Allegiant Air Sunseeker Consolidated YoY Passenger $ 717,016 $ 105,475 $ 822,491 $ 617,908 $ — $ 617,908 33.1 % Third party products 44,483 1,275 45,758 33,649 — 33,649 36.0 % Fixed fee contracts 14,523 31,200 45,723 17,019 — 17,019 168.7 % Cargo — 27,586 27,586 — — — NM Resort and other 185 1,747 1,932 174 20,634 20,808 (90.7) % Total operating revenues $ 776,207 $ 167,283 $ 943,490 $ 668,750 $ 20,634 $ 689,384 36.9 % NM Not meaningful * Sun Country numbers only after May 13, 2026 Passenger revenue. Passenger revenue for second quarter 2026 increased $204.6 million or 33.1 percent, of which Sun Country contributed $105.5 million during the stub period. The remaining change is attributable to strength in demand, which drove a 17.9 percent increase in average total fare for Allegiant Air, including a 39.9 percent increase in average scheduled service base fare. Allegiant Air scheduled service passengers decreased by 0.8 percent on a capacity reduction of 6.2 percent, resulting in a 4.0 percentage point increase in the Allegiant Air load factor. Third party products revenue. Third party products revenue increased $12.1 million or 36.0 percent, of which Sun Country contributed $1.3 million during the stub period. The remaining increase is attributable to a $9.3 million increase in the marketing component of Allegiant Air's co-brand remuneration and smaller increases in Allegiant Air's third party rental car and travel insurance revenue. These increases were slightly offset by a decrease in hotel room revenue. Fixed fee contract revenue. Fixed fee contract revenue increased $28.7 million, all of which was attributable to Sun Country during the stub period. Allegiant Air fixed fee revenue decreased $2.5 million driven by fewer charter flights flown during the quarter. Cargo revenue. Cargo revenue was $27.6 million, which was wholly attributable to the acquisition of Sun Country, and which was generated during the stub period. Resort and other revenue. Resort and other revenues decreased by $18.9 million due to the sale of Sunseeker Resort in September 2025. Operating Expenses The following table presents airline only operating unit costs on a per available seat mile (ASM) basis, defined as Operating CASM, for the indicated periods. Excluding fuel on a per ASM basis provides management and investors the ability to measure and monitor our cost performance absent fuel price volatility. Both the cost and availability of fuel are subject to many economic and political factors beyond our control. We also show Operating CASM excluding fuel costs, special charges, and cargo expenses. Excluding fuel costs, special charges, and cargo expenses allows management and investors to better compare our airline unit costs with those of other airlines. Sun Country cargo expenses (which are included in salaries and benefits, station operations, depreciation and amortization, maintenance and repairs, and other expenses in our consolidated statements of income) are excluded as those expenses do not drive ASMs. 31 Three Months Ended June 30, 2026 Three Months Ended June 30, 2025 Percent Change Airline Unitized costs (in cents) Allegiant Air Sun Country* Consolidated Allegiant Air Allegiant Air Aircraft fuel 4.90 ¢ 4.26 ¢ 4.80 ¢ 2.86 ¢ 71.3 % Salaries and benefits 3.72 4.90 3.91 3.51 6.0 Station operations 1.41 1.94 1.49 1.30 8.5 Depreciation and amortization 1.08 1.22 1.10 1.12 (3.6) Maintenance and repairs 0.73 0.99 0.77 0.63 15.9 Sales and marketing 0.55 0.53 0.55 0.43 27.9 Aircraft rent 0.13 — 0.11 0.19 (31.6) Other 0.55 1.15 0.64 0.50 10.0 Special charges 0.73 2.64 1.03 0.25 NM Airline operating CASM 13.80 ¢ 17.63 ¢ 14.40 ¢ 10.79 ¢ 27.9 Airline operating CASM, excluding fuel 8.90 ¢ 13.37 ¢ 9.60 ¢ 7.93 ¢ 12.2 Cargo expenses — ¢ 2.40 ¢ 0.38 ¢ — ¢ NM Airline operating CASM, excluding fuel, special charges, and cargo 8.17 ¢ 8.33 ¢ 8.19 ¢ 7.68 ¢ 6.4 NM Not meaningful * Sun Country numbers only after May 13, 2026 Airline operating CASM, excluding fuel, special charges and cargo expenses. Allegiant Air operating CASM, excluding fuel and special charges, increased 6.4 percent to 8.17 ¢ in second quarter 2026 from 7.68 ¢ in second quarter 2025. The increase was primarily driven by a 6.8 percent decrease in Allegiant Air capacity compared to the prior year quarter, which resulted in higher unit costs across most expense categories. CASM-ex was also impacted by the year-over-year expense increases discussed below. Sun Country CASM, excluding fuel, special charges, and cargo expenses, was 8.33 ¢ in second quarter 2026 (after May 13, 2026) and drove a 0.02 ¢ spread between Allegiant Air and Consolidated adjusted CASM. Aircraft fuel expense. Aircraft fuel expense increased by $141.9 million or 85.6 percent, of which Sun Country contributed $42.5 million during the stub period. The remaining increase of $99.4 million was driven by an increase in Allegiant Air fuel cost per gallon to $4.19 from $2.42 in the prior year quarter as a result of the geopolitical unrest in the Middle East. Increased fuel costs were partially offset by a decrease in Allegiant Air consumption consistent with a 6.8 percent decrease in total system ASMs and a 0.7 percent improvement in fuel efficiency as the percentage of ASMs flown by MAX aircraft continues to increase. Salaries and benefits expense. Salaries and benefits expense increased by $36.2 million or 16.9 percent, of which Sun Country contributed an increase of $49.0 million during the stub period, offset by a decrease of $10.6 million resulting from the sale of Sunseeker Resort. The remaining decrease of $2.1 million was driven by organizational restructuring initiatives implemented by Allegiant Air during 2025, which resulted in a 4.9 percent reduction in full-time equivalent Allegiant Air employees, offset by increased wages for certain employee workgroups due to contractual and annual merit raises. Station operations expense. Station operations expense increased $20.3 million or 27.0 percent, of which Sun Country contributed $19.4 million during the stub period. Depreciation and amortization expense. Depreciation and amortization expense increased by $2.2 million or 3.2 percent. Sun Country contributed an increase of $12.2 million during the stub period, and the sale of Sunseeker Resort resulted in a decrease of $3.6 million. The remaining decrease of $6.4 million was driven primarily by lower Allegiant Air heavy maintenance amortization resulting from a low volume of recent engine overhauls and 12 capitalized overhauls which became fully amortized since the prior year quarter. Maintenance and repairs expense. Maintenance and repairs expense increased $12.9 million, or 35.4 percent, of which Sun Country contributed $9.9 million during the stub period. The remaining increase of $3.0 million was driven by a higher volume of Allegiant Air engine check and repair costs and rotable part repairs compared to the prior year quarter. 32 Sales and marketing expense. Sales and marketing expense increased $8.4 million or 31.1 percent, of which $5.3 million was contributed by Sun Country during the stub period and a decrease of $1.7 million was attributable to the sale of Sunseeker Resort. The remaining increase of $4.7 million was primarily driven by higher Allegiant Air credit card processing fees consistent with the increase in Allegiant Air passenger revenue compared to the prior year quarter. Aircraft rent. Aircraft rent decreased $4.0 million as a result of lease return costs accrued during the prior year quarter that were not present in second quarter 2026 and as a result of seven leased aircraft which were returned to the lessor from operating leases since June 30, 2025. Other operating expense. Consolidated other operating expenses were relatively flat quarter over quarter as $11.5 million of other operating expenses contributed by Sun Country during the stub period were more than offset by a decrease of $12.1 million resulting from the sale of Sunseeker Resort. Special charges. Special charges were $66.0 million in second quarter 2026, of which $55.2 million relates to costs of the Sun Country acquisition and integration, $10.0 million relates to accelerated amortization of software identified for redevelopment, and $1.3 million relates to accelerated depreciation of airframes identified for early retirement. During second quarter 2025, special charges included a $102.2 million write-down of Sunseeker Resort assets as a result of the agreement to sell the Resort, $12.1 million of organizational restructuring charges, and $2.5 million from accelerated depreciation of airframes identified for early retirement. 33 Comparison of six months ended June 30, 2026 to six months ended June 30, 2025 Operating Revenue Six Months Ended June 30, 2026 Six Months Ended June 30, 2025 Percent Change Operating Revenues (in thousands) Allegiant Air Sun Country* Consolidated Allegiant Air Sunseeker Consolidated YoY Passenger $ 1,388,815 $ 105,475 $ 1,494,290 $ 1,234,658 $ — $ 1,234,658 21.0 % Third party products 86,818 1,275 88,093 68,852 — 68,852 27.9 % Fixed fee contracts 32,646 31,200 63,846 33,271 — 33,271 91.9 % Cargo — 27,586 27,586 — — — NM Resort and other 359 1,747 2,106 355 51,322 51,677 (95.9) % Total operating revenues $ 1,508,638 $ 167,283 $ 1,675,921 $ 1,337,136 $ 51,322 $ 1,388,458 20.7 % NM Not meaningful * Sun Country numbers only after May 13, 2026 Passenger revenue. Passenger revenue increased $259.6 million or 21.0 percent, of which $105.5 million was contributed by Sun Country during the stub period. The remaining increase is attributable to strength in demand, which drove a 14.0 percent increase in average total fare for Allegiant Air, including a 29.2 percent increase in scheduled service base fare. Allegiant Air passengers decreased by 0.7 percent on a scheduled service capacity reduction of 6.0 percent, resulting in a 3.9 percentage point increase in Allegiant Air load factor. Third party products revenue. Third party products revenue increased $19.2 million or 27.9 percent, of which $1.3 million was contributed by Sun Country during the stub period. The remaining increase is attributable to a $14.4 million increase in the marketing component of Allegiant Air co-brand remuneration and smaller increases in Allegiant Air's third party rental car and travel insurance revenue. These increases were slightly offset by a decrease in hotel room revenue. Fixed fee contract revenue. Fixed fee contract revenue increased $30.6 million or 91.9 percent, all of which is attributable to an increase of $31.2 million contributed by Sun Country during the stub period. The remaining decrease is attributable to a 13.7 percent decrease in Allegiant Air charter departures compared to the prior year period. Cargo revenue. Cargo revenue was $27.6 million, which was wholly attributable to the acquisition of Sun Country, and which was generated during the stub period. Resort and other revenue. Resort and other revenue decreased $49.6 million due to the sale of Sunseeker Resort in September 2025. Operating Expenses The following table presents airline only operating unit costs on a per available seat mile (ASM) basis, defined as Operating CASM, for the indicated periods. Excluding fuel on a per ASM basis provides management and investors the ability to measure and monitor our cost performance absent fuel price volatility. Both the cost and availability of fuel are subject to many economic and political factors beyond our control. Excluding fuel costs, special charges, and cargo expenses allows management and investors to better compare our airline unit costs with those of other airlines. Sun Country cargo expenses (which are included in salaries and benefits, station operations, depreciation and amortization, maintenance and repairs, and other expenses in the Company's consolidated statements of income) are excluded as those expenses do not drive ASMs. 34 Six Months Ended June 30, 2026 Six Months Ended June 30, 2025 Percent Change Airline Unitized costs (in cents) Allegiant Air Sun Country Consolidated Allegiant Air Allegiant Air Aircraft fuel 4.23 ¢ 4.26 ¢ 4.23 ¢ 2.95 ¢ 43.4 % Salaries and benefits 3.98 4.90 4.06 3.77 ¢ 5.6 Station operations 1.45 1.94 1.49 1.32 9.8 Depreciation and amortization 1.11 1.22 1.11 1.11 — Maintenance and repairs 0.71 0.99 0.73 0.63 12.7 Sales and marketing 0.55 0.53 0.55 0.43 27.9 Aircraft rent 0.14 — 0.13 0.15 (6.7) Other 0.46 1.15 0.54 0.46 — Special charges 0.63 2.64 0.81 0.14 NM Airline operating CASM 13.26 ¢ 17.63 ¢ 13.65 ¢ 10.96 ¢ 21.0 Airline operating CASM, excluding fuel 9.03 ¢ 13.37 ¢ 9.42 ¢ 8.01 ¢ 12.7 Cargo expenses — ¢ 2.40 ¢ 0.21 ¢ — ¢ NM Airline operating CASM, excluding fuel, special charges, and cargo 8.40 ¢ 8.33 ¢ 8.40 ¢ 7.87 ¢ 6.7 Airline operating CASM, excluding fuel and special charges. Allegiant Air operating CASM, excluding fuel and special charges, increased by 6.7 percent to 8.40 ¢ compared to 7.87 ¢ for the same period in 2025. The increase was primarily driven by a 6.3 percent reduction in capacity compared to the prior year period, which resulted in higher unit costs across most expense categories. CASM-ex was also impacted by the year-over-year expense increases discussed below. Sun Country CASM, excluding fuel, special charges, and cargo expenses, was 8.33 ¢ during the stub period and did not drive any significant change to Consolidated CASM for the period. Aircraft fuel expense. Aircraft fuel expense increased $155.8 million or 46.9 percent, of which Sun Country contributed $42.5 million during the stub period. The remaining increase of $113.3 million was driven by an increase in Allegiant Air fuel cost per gallon to $3.63 from $2.51 in the prior year period as a result of the geopolitical unrest in the Middle East. Increased fuel costs were partially offset by a decrease in Allegiant Air consumption consistent with a 6.3 percent decrease in total system ASMs and a 1.0 percent increase in fuel efficiency as the percentage of ASMs flown by MAX aircraft continues to increase. Salaries and benefits expense. Salaries and benefits expense increased by $22.9 million or 5.1 percent. Sun Country contributed an increase of $49.0 million during the stub period, and a decrease of $21.7 million resulted from the sale of Sunseeker Resort. The remaining decrease of $4.4 million was primarily driven by organizational restructuring initiatives implemented at Allegiant Air during 2025, which resulted in a 4.9 percent reduction in Allegiant Air full-time equivalent employees, offset by increased wages for certain employee workgroups due to contractual and annual merit raises. Station operations expense. Station operations expense increased $23.3 million or 15.7 percent, of which Sun Country contributed $19.4 million during the stub period. The remaining increase of $3.9 million was primarily driven by higher Allegiant Air ground handling rates and the transition of certain station positions to outsourced operations. These increases were partially offset by decreases in Allegiant Air airport fees consistent with the 6.0 percent decrease in departures. Depreciation and amortization expense. Depreciation and amortization expense decreased $3.2 million or 2.4 percent. Sun Country contributed an increase of $12.2 million during the stub period, and the sale of Sunseeker Resort resulted in a decrease of $7.2 million. The remaining decrease of $8.2 million was driven primarily by lower Allegiant Air heavy maintenance amortization resulting from a low volume of recent engine overhauls and 12 capitalized overhauls which became fully amortized since the prior year period. Maintenance and repairs expense. Maintenance and repairs expense increased $13.2 million or 18.6 percent, of which Sun Country contributed $9.9 million during the stub period. 35 The remaining increase of $3.3 million was driven by a higher volume of Allegiant Air engine check and repair costs and rotable part repairs compared to the prior year period. Sales and marketing expense. Sales and marketing expense increased $11.5 million or 22.1 percent, of which $5.3 million was contributed by Sun Country during the stub period and a decrease of $3.4 million was attributable to the sale of Sunseeker Resort. The remaining increase of $9.6 million was driven by higher Allegiant Air credit card processing fees consistent with the increase in passenger revenue and a non-recurring item related to our credit card agreement that offset expenses in the prior year period. Aircraft rent. Aircraft rent decreased $2.5 million or 14.6 percent as a result of lease return costs accrued during the prior year period which are not present in current period results and as a result of seven leased aircraft which have been returned to the lessor from operating leases since June 30, 2025. Other operating expense. Other operating expenses were impacted primarily by $11.5 million contributed by Sun Country during the stub period and a decrease of $25.2 million resulting from the sale of Sunseeker Resort. Special charges. Special charges were $93.7 million for the six months ended June 30, 2026, of which $64.8 million relates to costs of the Sun Country acquisition and integration, $19.9 million relates to accelerated amortization of software identified for redevelopment, $7.0 million relates to a credit loss on a note receivable, and $2.7 million relates to accelerated depreciation of airframes identified for early retirement. During the six months ended June 30, 2025, special charges included a $102.2 million write-down of Sunseeker Resort assets as a result of the agreement to sell the Resort, $12.1 million of organizational restructuring charges, and $3.9 million from accelerated depreciation of airframes identified for early retirement. 36 Comparative Operating Statistics The following tables set forth our operating statistics for the three-month periods indicated: Three Months Ended June 30, Percent Change (1) 2026 2025 YoY Airline operating statistics (unaudited): Total system statistics: Passengers 5,753,539 5,127,025 12.2 % Available seat miles (ASMs) (thousands) 6,406,325 5,799,409 10.5 Airline operating expense per ASM (CASM) (cents) 13.89 ¢ 10.79 ¢ 28.7 Airline operating CASM, excluding fuel, special charges and cargo expenses (cents) 8.19 ¢ 7.68 ¢ 6.6 Departures 42,833 37,314 14.8 Block hours 104,652 88,749 17.9 Average stage length (miles) 905 886 2.1 Average block hours per aircraft per day 7.2 7.7 (6.5) Full-time equivalent employees at end of period 8,484 5,980 41.9 Fuel gallons consumed (thousands) 74,292 68,452 8.5 ASMs per gallon of fuel 86.2 84.7 1.8 Average fuel cost per gallon $ 4.14 $ 2.42 71.1 Scheduled service statistics: Passengers 5,616,207 5,077,788 10.6 Revenue passenger miles (RPMs) (thousands) 5,226,070 4,610,321 13.4 Available seat miles (ASMs) (thousands) 6,097,107 5,629,040 8.3 Load factor 85.7 % 81.9 % 3.8 Departures 37,502 36,056 4.0 Block hours 92,259 85,980 7.3 Average seats per departure 177.0 175.1 1.1 Yield (cents) (2) 8.26 ¢ 5.75 ¢ 43.7 Total passenger revenue per ASM (TRASM) (cents)(3) 14.24 ¢ 11.57 ¢ 23.1 Average fare - scheduled service(4) $ 76.90 $ 52.20 47.3 Average fare - air-related charges(4) $ 69.55 $ 69.49 0.1 Average fare - third party products $ 8.15 $ 6.63 22.9 Average fare - total $ 154.60 $ 128.32 20.5 Average stage length (miles) 914 891 2.6 Fuel gallons consumed (thousands) 70,655 66,419 6.4 Average fuel cost per gallon $ 4.15 $ 2.43 70.8 Three Months Ended June 30, 2026 Allegiant Air Sun Country AIRLINE OPERATING STATISTICS (BY SEGMENT) Total system statistics: Passengers 5,073,414 680,125 Available seat miles (ASMs) (thousands) 5,406,461 999,864 Departures 34,733 8,100 Scheduled service statistics: . Revenue passenger miles (RPMs) (thousands) 4,538,749 687,322 Available seat miles (ASMs) (thousands) 5,281,688 815,419 Block hours 80,881 11,378 Fuel cost per gallon, excluding indirect fuel credits $4.19 $3.87 (1)Except load factor during period, which is presented as a percentage point change. (2)Defined as scheduled service revenue divided by revenue passenger miles. (3)Various components of this measure do not have a direct correlation to ASMs. This measure is provided on a per ASM basis so as to facilitate comparison with airlines reporting revenues on a per ASM basis. (4)Reflects division of passenger revenue between scheduled service (base fare) and air-related charges in our booking path. 37 The following tables set forth our operating statistics for the six-month periods indicated: Six Months Ended June 30, Percent Change (1) 2026 2025 YoY Airline operating statistics (unaudited): Total system statistics: Passengers 10,182,002 9,578,331 6.3 % Available seat miles (ASMs) (thousands) 11,536,867 11,250,993 2.5 Airline operating expense per ASM (CASM) (cents) 13.37 ¢ 10.96 ¢ 22.0 Airline operating CASM, excluding fuel, special charges and cargo (cents) 8.40 ¢ 7.87 ¢ 6.7 Departures 74,403 70,549 5.5 Block hours 183,475 172,620 6.3 Average stage length (miles) 906 909 (0.3) Average block hours per aircraft per day 7.2 7.6 (5.3) Full-time equivalent employees at end of period 8,484 5,980 41.9 Fuel gallons consumed (thousands) 133,492 132,089 1.1 ASMs per gallon of fuel 86.4 85.2 1.4 Average fuel cost per gallon $ 3.65 $ 2.51 45.4 Scheduled service statistics: Passengers 10,014,314 9,498,599 5.4 Revenue passenger miles (RPMs) (thousands) 9,436,965 8,881,650 6.3 Available seat miles (ASMs) (thousands) 11,088,667 10,934,232 1.4 Load factor 85.1 % 81.2 % 3.9 Departures 67,974 68,189 (0.3) Block hours 168,756 167,394 0.8 Average seats per departure 176.6 175.0 0.9 Yield (cents) (2) 8.38 ¢ 6.38 ¢ 31.3 Total passenger revenue per ASM (TRASM) (cents)(3) 14.27 ¢ 11.92 ¢ 19.7 Average fare - scheduled service(4) $ 78.99 $ 59.64 32.4 Average fare - air-related charges(4) $ 70.22 $ 70.34 (0.2) Average fare - third party products $ 8.80 $ 7.25 21.4 Average fare - total $ 158.01 $ 137.23 15.1 Average stage length (miles) 920 914 0.7 Fuel gallons consumed (thousands) 128,197 128,245 — Average fuel cost per gallon $ 3.65 $ 2.52 44.8 Six Months Ended June 30, 2026 Allegiant Air Sun Country AIRLINE OPERATING STATISTICS (BY SEGMENT) Total system statistics: Passengers 9,501,877 680,125 Available seat miles (ASMs) (thousands) 10,537,003 999,864 Departures 66,303 8,100 Scheduled service statistics: . Revenue passenger miles (RPMs) (thousands) 8,749,644 687,322 Available seat miles (ASMs) (thousands) 10,273,248 815,419 Block hours 157,378 11,378 Fuel cost per gallon, excluding indirect fuel credits $3.63 $3.87 (1)Except load factor during period, which is presented as a percentage point change. (2)Defined as scheduled service revenue divided by revenue passenger miles. (3)Various components of this measure do not have a direct correlation to ASMs. This measure is provided on a per ASM basis so as to facilitate comparison with airlines reporting revenues on a per ASM basis. (4)Reflects division of passenger revenue between scheduled service (base fare) and air-related charges in our booking path. 38 LIQUIDITY AND CAPITAL RESOURCES Current liquidity Cash, cash equivalents and investment securities (short-term and long-term) increased to $1.1 billion as of June 30, 2026, from $0.8 billion at December 31, 2025. Investment securities represent highly liquid marketable securities which are available-for-sale. As of June 30, 2026, we had $250.0 million of undrawn capacity under revolving credit facilities and $177.0 million under prearranged aircraft financing facilities. Restricted cash represents escrowed funds under fixed fee contracts and cash collateral against letters of credit required by hotel properties for guaranteed room availability, airports and certain other parties. Under our fixed fee flying contracts, we require our customers to prepay for flights to be provided by us. The prepayments are escrowed until the flight is completed and are recorded as restricted cash with a corresponding amount reflected as air traffic liability. Our operating cash flows and long-term debt borrowings have allowed us to invest in our fleet renewal. Future capital needs are primarily for the acquisition of additional aircraft, including our existing aircraft commitments, as well as investments related to the integration and ongoing operations of Sun Country following the acquisition. Our share repurchase authority at June 30, 2026 is $64.7 million. We did not repurchase any shares on the open market during the first six months of 2026. We have indefinitely suspended our quarterly cash dividend in anticipation of upcoming capital needs related to our fleet investments. We believe we have more than adequate liquidity resources through our cash, cash equivalent and short-term investment balances, existing aircraft financing facilities, our undrawn capacity under existing credit facilities, operating cash flows and anticipated access to liquidity, to meet our current contractual obligations and remain in compliance with the debt covenants in our existing financing agreements for the next 12 months. We will continue to consider raising funds through debt financing as needed to fund capital expenditures. Debt Our debt and finance lease obligations balance, before reduction for related issuance costs, was $2.8 billion as of June 30, 2026, compared to $1.8 billion as of December 31, 2025. Net debt (total debt less unrestricted cash, cash equivalents, and investments) totaled $1.7 billion as of June 30, 2026, representing an increase of $749.4 million from December 31, 2025. The increase in debt was attributable to the acquisition of Sun Country, which contributed $546.8 million of the increase in balance sheet debt, and to $895.2 million of new borrowings which were offset by principal repayments of $451.8 million and debt issuance costs. Sun Country's debt structure assumed in the acquisition consisted primarily of finance lease obligations, enhanced equipment trust certificates, and term loan borrowings. During the six months ended June 30, 2026, we borrowed $895.2 million, including the issuance of $650.0 million aggregate principal amount of Senior Secured Notes due 2031. The borrowings during the period also included $245.2 million of debt which was secured by aircraft and aircraft related assets. A portion of the proceeds from the Senior Secured Notes due 2031 was used to refinance our Senior Secured Notes due 2027. During the period, we made principal payments of $475.4 million, including the repurchase of approximately $377.5 million aggregate principal amount of our Senior Secured Notes due 2027 in a tender offer and a $13.8 million prepayment under our PDP financing facility. In connection with the acquisition of Sun Country, we assumed approximately $570.3 million of debt and finance lease obligations. As of June 30, 2026, approximately 66.9 percent of our debt and finance lease obligations are fixed-rate. Sources and Uses of Cash Operating Activities During the six months ended June 30, 2026, and 2025, we generated cash flows from operations of $314.1 million and $283.6 million respectively. Our operating cash flows are impacted by the following factors: Advance Ticket Sales. Tickets for air travel are typically purchased in advance of the travel date. When we receive a cash payment at the time of booking, we record the cash received as deferred revenue in air traffic liability. When the flight is flown, we recognize the liability from air traffic liability into revenue. Due to the seasonal nature of our operations, our air traffic liability balances will fluctuate in line with our peak flying seasons. 39 Fuel. With the recent fuel price increases, fuel is our largest expense. The market price for jet fuel is volatile, which can impact the comparability of our periodic cash flows from operations. During the six months ended June 30, 2026, Allegiant Air decreased our year over year flying capacity by 6.3 percent, which led to a 7.2 percent decrease in fuel gallons consumed when compared to the same period in 2025. However, this decrease was offset by a 44.6 percent increase in average fuel cost per gallon for Allegiant Air over the same period in 2025, stemming from the Iranian conflict beginning on February 28, 2026. We expect to continue to see material increases in fuel costs while these circumstances persist. Salaries and Benefits. Salaries and benefits expense represents our second largest expense and has increased considerably in recent years. Cash payments for our salaries and benefits expense are typically made in the period that they are incurred with the exception of our pilot retention bonus, which we expect will be paid to all pilots no later than fourth quarter 2026 as a new collective bargaining agreement was ratified in July 2026. For the quarters ended June 30, 2026 and 2025, we recognized, within the accrued liabilities line item in our balance sheet, approximately $17.0 million and $23.8 million, respectively, of expense related to the pilot retention bonus, including related payroll taxes. Investing Activities Investments. We hold various financial assets and will strategically purchase and sell these assets based on operational cash needs. During the six months ended June 30, 2026, we had $161.1 million of net investment maturities (net cash inflows) compared to $90.0 million of net investment purchases (net cash outflows) during the same period in 2025. Capital Expenditures. Capital expenditures for the six months ended June 30, 2026 and 2025 were $386.0 million and $186.9 million, respectively. In December 2021, we committed to purchase 50 Boeing 737 MAX aircraft, of which we began to receive delivery in September 2024. During the six months ended June 30, 2026, we took delivery of four aircraft and made pre-delivery payments on certain of the remaining 30 aircraft under firm commitment. Acquisition of Sun Country. We paid cash consideration of $167.1 million to acquire Sun Country, which is net of $139.9 million cash acquired. Financing Activities Long-Term Debt and Finance Leases. Cash provided by financing activities for the six months ended June 30, 2026 was $411.1 million, which was net of $22.8 million used by Sun Country during the stub period, compared to $116.2 million used for financing activities of legacy Allegiant only during the same period in 2025. During the six months ended June 30, 2026, we received proceeds of $895.2 million from our Senior Secured Notes due 2031 and other borrowings secured by aircraft and made principal payments of $474.4 million on our debt and finance lease obligations. During the six months ended June 30, 2025, we made $432.6 million of principal repayments on our debt and finance leases, largely related to prepayments of the Sunseeker construction loan and a PDP financing facility, and received proceeds from the issuance of aircraft financing debt totalling $323.8 million. 40 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS We have made forward-looking statements in this quarterly report on Form 10-Q, and in the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” that are based on our management’s beliefs and assumptions, and on information currently available to our management. Forward-looking statements include our statements regarding future airline operations, revenue, expenses and earnings, available seat mile growth, expected capital expenditures, the cost of fuel, the timing of aircraft acquisitions and retirements, the number of contracted aircraft to be placed in service in the future, our ability to consummate announced aircraft transactions, estimated tax rate, as well as other information concerning future results of operations, business strategies, financing plans, industry environment and potential growth opportunities. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words "believe," "expect," “guidance,” "anticipate," "intend," "plan," "estimate", “project”, “hope” or similar expressions. Forward-looking statements involve risks, uncertainties and assumptions. Actual results may differ materially from those expressed in the forward-looking statements. Important risk factors that could cause our results to differ materially from those expressed in the forward-looking statements generally may be found in our periodic reports filed with the Securities and Exchange Commission at www.sec.gov. These risk factors include, without limitation, regulatory reviews of, and production limits on, Boeing impacting our aircraft delivery schedule, an accident involving, or problems with, our aircraft, public perception of our safety, our reliance on our automated systems, our reliance on Boeing to deliver aircraft under contract to us on a timely basis, risk of breach of security of personal data, volatility of fuel costs, labor issues and costs, the ability to obtain regulatory approvals as needed in connection with our fleet and network, the effect of economic conditions on leisure travel, debt covenants and balances, the impact of government regulations on the airline industry, the ability to finance aircraft to be acquired, the ability to obtain necessary government approvals to offer international service, terrorist attacks, risks inherent to airlines, our competitive environment, our reliance on third parties who provide facilities or services to us, the impact of the possible loss of key personnel, economic and other conditions in markets in which we operate, increases in maintenance costs and availability of outside maintenance contractors to perform needed work on our aircraft on a timely basis and at acceptable rates, cyclical and seasonal fluctuations in our operating results, the perceived acceptability of our environmental, social and governance efforts, the risk that the combined company after the Sun Country acquisition will not realize expected benefits, cost savings, accretion, synergies and/or growth from the Sun Country acquisition or that any of the foregoing may take longer to realize or be more costly to achieve than expected, the diversion of management's attention and time from ongoing business operations and opportunities to integration matters, the risk that the integration of Sun Country's operations will be materially delayed or will be more costly or difficult than expected or that Allegiant is otherwise unable to successfully integrate Sun Country's businesses into its businesses, and reputational risk and potential adverse reactions of Allegiant's or Sun Country's customers, suppliers, employees, labor unions or other business partners, including those resulting from the completion of the Sun Country acquisition and the integration of the companies. Any forward-looking statements are based on information available to us today and we undertake no obligation to update publicly any forward-looking statements, whether as a result of future events, new information or otherwise. CRITICAL ACCOUNTING POLICIES AND ESTIMATES Except as set forth below, there were no material changes to our critical accounting estimates during the six months ended June 30, 2026. For information regarding our critical accounting policies and estimates, see disclosures in the Consolidated Financial Statements and accompanying notes contained in our 2025 Form 10-K, and in Note 1 of Notes to Consolidated Financial Statements (unaudited) in this Form 10-Q. Business Combination Accounting To record the value of assets acquired and liabilities assumed as a result of our acquisition of Sun Country on May 13, 2026, we have performed a purchase price allocation utilizing the best information available to management. The purchase price allocation is provisional and is subject to further adjustments as additional information becomes available concerning the fair value of the assets acquired and liabilities assumed, with any adjustments to the purchase price allocation to be made as soon as practicable but no later than May 13, 2027. Business combination accounting requires management to make assumptions and apply judgment. The fair values of the assets and liabilities acquired were determined using a market basis, relief from royalty, or multi-period excess earnings approach. Key assumptions include, but are not limited to, selecting discount rates and valuation methodologies. These estimates and assumptions are subjective. 41