477143AP6

Part I, Item 2 of this Report should be read together with our condensed consolidated financial statements and related notes included elsewhere in this Report and our audited consolidated financial statements and related notes included in our 2025 Form 10-K. This discussion contains forward-looking statements based upon current plans, expectations and beliefs involving risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including those set forth in Part I, Item 1A "Risk Factors" of our 2025 Form 10-K and in Part II, Item 1A "Risk Factors" and other parts of this Report. We expect our operating results to fluctuate significantly from quarter-to-quarter in the future due to factors such as economic and geopolitical conditions, weather events, cost of aircraft fuel, and various other factors, many of which are outside of our control. Consequently, we believe quarter-over-quarter comparisons of our operating results may not necessarily be meaningful; you should not rely on our results for any one quarter as an indication of our future performance. Except for uncertainty related to the cost of aircraft fuel, we expect our expenses to continue to increase from wage rate cost pressures, as we acquire additional aircraft, and as our fleet ages. OVERVIEW Second Quarter 2026 Results In the second quarter of 2026, we had an operating loss of $141 million, compared to an operating income of $6 million in the 2025 period. The increase in operating loss is driven by higher operating expenses, primarily due to higher fuel prices. The increase in operating expenses was partially offset by higher revenue driven by stronger demand and increased pricing. As we progressed through the second quarter of 2026, demand remained resilient across our network, even as JetBlue and industry fares moved higher throughout the quarter. Strength was robust throughout the booking curve, including close-in demand. Our second quarter 2026 highlights include the following: •Second quarter 2026 system available seat miles ("ASMs" or "capacity") increased by 3.2% year-over-year. •Operating revenue for the second quarter of 2026 was $2.7 billion, a 14.5% increase year-over-year. •Operating expense for the second quarter of 2026 was $2.8 billion, a 20.8% increase year-over-year. •Operating expense, excluding special items (1) for the second quarter of 2026 was $2.8 billion, a 22.0% increase year-over-year. •Operating expense per available seat mile ("CASM") for the second quarter of 2026 increased by 17.0% year-over-year to 16.53 cents compared to the second quarter of 2025. •Excluding fuel, special items, and operating expenses related to our non-airline businesses, our cost per available seat mile ("CASM ex-fuel") (1) increased by 2.4% to 11.12 cents in the second quarter of 2026 compared to the second quarter of 2025. Recent Developments JetForward JetForward, our strategic framework, is focused on four priority moves: delivering reliable and caring service, building the best east coast leisure network, offering products and perks customers value, and providing a secure financial future. Our JetForward plan, which is designed to support our long-term profitability goals, reflects various assumptions regarding factors that may impact our operational and financial performance. For further information on potential factors that could affect the success of our strategic initiatives, including JetForward, see Part I, Item 1A "Risk Factors" within our 2025 Form 10-K. The sections below highlight some actions made to support these priority moves during the quarter. (1) Refer to "Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure. 24 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Reliable and Caring Service We remain focused on delivering safe, reliable, and caring service for our customers. On-time performance, as defined by the DOT, is arrival within 14 minutes of scheduled arrival time. In the three months ended June 30, 2026, our system-wide on-time performance was 78.2% compared to 77.3% for the same period in 2025. Our completion factor was in line with the prior period at 99.5% for the three months ended June 30, 2026 compared to 99.6% for the same period in 2025. Best East Coast Leisure Network We are focused on high-performing leisure, visiting-friends-and-relatives and transcontinental routes in core geographies like New York, New England, Florida, and Puerto Rico. In the second quarter, we continued executing our strategy to build the best East Coast leisure network, and launched seasonal service from Boston to two new destinations, Barcelona and Milan, with Milan marking JetBlue's first-ever service to Italy. Together, these additions expanded our Boston transatlantic reach to nine European destinations. In addition, we continued expanding our presence in Fort Lauderdale, where Spirit’s exit represents one of the most significant strategic opportunities JetBlue has seen in many years. Fort Lauderdale continued to benefit from very strong customer demand, and second quarter revenue per ASM ("RASM") increased 11%, while capacity increased nearly 40%. In July 2026, we launched additional service from Fort Lauderdale and now operate more than 125 daily departures to more than 55 nonstop destinations, representing our largest schedule from the airport. We also introduced a more structured bank schedule, with two southbound and two northbound banks designed to better connect customers to the Caribbean and Latin America. By December, we expect to surpass 150 daily flights from Fort Lauderdale and operate the largest Mint® schedule from Fort Lauderdale in JetBlue's history. In July 2026, we were selected as the successful bidder to acquire certain operating authorizations (slots) previously operated by Spirit Airlines at New York's LaGuardia Airport. If completed, the acquisition would support up to 12 daily roundtrips at LaGuardia. The transaction closing remains subject to regulatory approvals and other conditions. Products and Perks Customers Value During the second quarter of 2026, we continued to enhance our products and services by increasing the value of our loyalty program, expanding premium offerings, and introducing additional benefits designed to improve the customer experience. Blue Sky implementation advanced in the second quarter of 2026 with the introduction of reciprocal loyalty benefits for eligible Mosaic and MileagePlus members, including priority boarding, preferred and extra legroom seating, and same-day standby options. In July 2026, Paisly began distributing United's car rental products, with hotels and travel insurance expected in the fourth quarter of 2026, further supporting our broader travel platform strategy. We continued to see strong engagement across our loyalty offerings, supported in part by the relaunch of our premium co-brand credit card and demand for its BlueHouseTM benefit, which contributed to growth in new card acquisitions and loyalty remuneration during the quarter. In addition, we launched a new Buy Now, Pay Later option through ClarityPay, providing customers with additional payment flexibility. We continue to invest in our premium offerings, including our BlueHouseTM lounge network, with the second location expected to open in Boston in August 2026. BlueFirstTM, our planned domestic first-class product is our largest individual JetForward initiative, and an important next step in evolving our product offering. We plan to launch sales in the fall of 2026, with the majority of the retrofit work expected to be completed by the end of 2027. We also continued to enhance Mint®, which earned the highest ranking in customer satisfaction in the first/business class segment in North America by J.D. Power for the second consecutive year. During the quarter, we announced new onboard culinary partnerships for Mint® with refreshed menu offerings inspired by New York restaurants expected to begin in the third quarter of 2026. A Secure Financial Future To secure our financial future, we remain focused on preserving liquidity, maintaining cost discipline, and proactively managing our balance sheet. In the second quarter, as fuel prices remained elevated and the macroeconomic and geopolitical backdrop remained fluid, we focused on the levers within our control, including disciplined capacity, commercial actions, cost 25 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS initiatives, and fuel burn. JetForward continued to support profitability through cost initiatives, including enhanced digital tools and technology modernization to improve crewmember productivity, improved fuel efficiency through advanced flight planning and routing, real-time data, and predictive analytics, and expanded AI- and data science-enabled capabilities to improve planning, automate decision-making, and better manage disruptions. We also completed a $500 million aircraft-backed financing transaction, further strengthening our liquidity position.We continue to take a disciplined and proactive approach to managing the balance sheet, with a focus on maintaining liquidity, supporting JetForward, and optimizing our cost of capital. Liquidity At June 30, 2026, we had $2.2 billion in liquidity, which included unrestricted cash, cash equivalents, and investment securities. In addition, we have a $600 million Citibank undrawn line of credit. Pratt & Whitney In July 2023, Pratt & Whitney, a division of RTX Corporation, announced the requirement, mandated by the FAA, for removal of certain engines for inspection due to a rare condition involving powdered metal used in the production of certain engine parts on the PW1100G and PW1500G engine types. These engines power our Airbus A321neo and Airbus A220 fleets. The powdered metal affects engines manufactured between October 2015 and September 2021. Those engines are now required to be inspected after they have reached a reduced number of cycles dependent on the fleet type. As a result of these required inspections and other engine durability deficiencies, as of June 30, 2026, we had four aircraft grounded due to lack of engine availability. The Company currently expects each removed engine to take approximately 200 days for the PW1500G engines and approximately 300 days for the PW1100G engines to complete a shop visit and return to a serviceable condition. We believe we are past the peak number of groundings and expect the number of aircraft on the ground due to lack of engine availability to be in mid-single digits for the remainder of 2026. On July 27, 2026, we entered into supplemental support and other agreements with International Aero Engines, LLC ("IAE"), an affiliate of RTX Corporation, Pratt & Whitney Division, related to certain PW1100G and PW1500G engine operational disruptions, technical issues occurring through December 31, 2025 and other matters. Under the agreements, we received consideration including credits up to $105 million that may be applied toward future purchases of qualifying goods and services from IAE, IAE International Aero Engines AG and Pratt & Whitney through December 31, 2027, including in exchange for waiving certain claims. These credits are accounted for as vendor consideration under ASC 705-20 and will be allocated to qualifying purchases through December 31, 2027 based on our estimated eligible spend for applicable goods and services during that period. Credits associated with operating expenditures will be recognized as reductions of the related operating expenses, while credits associated with capital expenditures will be recognized as reductions of the cost basis of the related assets. Embraer E190 Fleet Transition In 2025, as part of the Company's fleet transition plan, we retired our remaining Embraer E190 aircraft and entered into definitive agreements to sell the remaining E190 fleet. During the six months ended June 30, 2026, we sold our remaining owned Embraer E190 airframes, as well as certain Embraer E190 engines and related spare parts, and recorded a net gain of $30 million, which is included in other operating expenses on our consolidated statements of operations. We also returned our remaining leased E190 aircraft. As of June 30, 2026, one Embraer E190 engine and certain related spare parts remained available for sale. 26 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS Three Months Ended June 30, 2026 vs. 2025 Overview We reported a net loss of $247 million, operating loss of $141 million and an operating margin of (5.2)% for the three months ended June 30, 2026. This compares to a net loss of $74 million, an operating income of $6 million and an operating margin of 0.3% for the three months ended June 30, 2025. Our loss per share was $0.66 for the second quarter of 2026 compared to a loss per share of $0.21 for the same period in 2025. Net loss increased $173 million year-over-year primarily due to an increase in fuel expense partially offset by higher revenue driven by stronger demand and increased pricing as compared to the same period in 2025. Our reported results for the three months ended June 30, 2026 and 2025 included the effects of certain gains on investments. For the three months ended June 30, 2025, our reported results also included the effects of special items. Adjusting for these items, our adjusted net loss (1) was $247 million, adjusted operating loss (1) was $141 million, adjusted operating margin (1) was (5.2)%, and adjusted loss per share (1) was $0.66 for the three months ended June 30, 2026. This compares to an adjusted net loss (1) of $58 million, adjusted operating income (1) of $30 million, adjusted operating margin (1) of 1.3%, and adjusted loss per share (1) of $0.16 for the three months ended June 30, 2025. Operating Revenues (Revenues in millions; percent changes based on unrounded numbers) Three Months Ended June 30, Year-over-Year Change 2026 2025 $ % Passenger revenue $ 2,487 $ 2,179 $ 308 14.1 % Other revenue 210 177 33 18.6 Total operating revenues $ 2,697 $ 2,356 $ 341 14.5 % Average fare $ 237.38 $ 218.52 $ 18.86 8.6 % Yield per passenger mile (cents) 17.53 15.99 1.54 9.6 Passenger revenue per ASM (cents) 14.49 13.10 1.39 10.6 Operating revenue per ASM (cents) 15.71 14.17 1.54 10.9 Average stage length (miles) 1,300 1,309 (9) (0.7) Revenue passengers (thousands) 10,479 9,973 506 5.1 Revenue passenger miles (millions) 14,192 13,627 565 4.1 Available seat miles (ASMs) (millions) 17,170 16,634 536 3.2 Load factor 82.7 % 81.9 % 0.8 pts. Passenger revenue is our primary source of revenue, which includes seat revenue and baggage fees, as well as revenue from our ancillary product offerings such as EvenMore®. Passenger revenue increased 14.1% for the three months ended June 30, 2026 compared to the same period in 2025. This was mainly driven by a 9.6% higher yield and a 5.1% increase in revenue passengers than the prior period. Other revenue increased $33 million, or 18.6%, primarily due to higher customer spend related to loyalty revenue from the non-transportation elements of the sale of TrueBlue® points. Other revenue also includes revenue from the sale of vacation packages, airport concessions, charters, advertising, and lounge revenue. We measure capacity in terms of available seat miles, which represents the number of seats available for passengers multiplied by the number of miles the seats are flown. Yield, or the average amount one passenger pays to fly one mile, is calculated by dividing passenger revenue by revenue passenger miles. We attempt to increase passenger revenue by increasing our yield and also increasing our load factor of flights, when possible. Our objective is to optimize our fare mix to increase our overall revenue per available seat mile while continuing to provide our customers with competitive fares. (1) Refer to "Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure. 27 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Operating Expenses In detail, our operating costs per ASM, were as follows: (in millions; per ASM data in cents; percent changes based on unrounded numbers) Three Months Ended June 30, Year-over-Year Change Cents per ASM 2026 2025 $ % 2026 2025 % Change Aircraft fuel $ 911 $ 504 $ 407 80.7 % 5.31 3.03 75.1 % Salaries, wages and benefits 875 852 23 2.7 5.10 5.12 (0.5) Landing fees and other rents 183 171 12 7.1 1.06 1.03 3.8 Depreciation and amortization 183 171 12 6.9 1.06 1.03 3.5 Aircraft rent 15 20 (5) (23.7) 0.09 0.12 (26.1) Sales and marketing 88 76 12 14.9 0.51 0.46 11.3 Maintenance, materials and repairs 204 198 6 3.1 1.19 1.19 (0.1) Special items — 24 (24) (99.4) — 0.14 (99.4) Other operating expenses 379 334 45 13.4 2.21 2.01 9.9 Total operating expenses $ 2,838 $ 2,350 $ 488 20.8 % 16.53 14.13 17.0 % Aircraft Fuel Aircraft fuel increased by $407 million, or 80.7%, for the three months ended June 30, 2026 compared to the same period in 2025. The average fuel price increased by 76.3% to $4.23 per gallon and fuel consumption increased by 2.5%, or 5 million gallons. Landing Fees and Other Rents Landing fees and other rents increased by $12 million, or 7.1%, for the three months ended June 30, 2026 compared to the same period in 2025, primarily due to rate increases in certain cities and a decrease in airport rent credits received. Depreciation and Amortization Depreciation and amortization increased by $12 million, or 6.9%, for the three months ended June 30, 2026 compared to the same period in 2025. This increase was primarily driven by the induction of new aircraft and spare engines, partially offset by the retirement of the Embraer E190 fleet as part of the Company's fleet transition plan. Aircraft Rent Aircraft rent decreased by $5 million, or 23.7%, in the three months ended June 30, 2026 compared to the same period in 2025, primarily due to fewer leases for Airbus A320 aircraft and Embraer E190 aircraft. As part of the Company's fleet transition plan, Embraer E190 aircraft leases reached their lease expiration and were returned to the lessor. The decrease was partially offset by an increase in the number of leased engines. Sales and Marketing Sales and marketing increased by $12 million, or 14.9%, in the three months ended June 30, 2026 compared to the same period in 2025, primarily due to higher credit card fees as a result of the increase in passenger revenue. Special Items There were no special items for the three months ended June 30, 2026. For the three months ended June 30, 2025, special items consisted of $24 million of voluntary opt-out costs. 28 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Other Operating Expenses Other operating expenses increased by $45 million, or 13.4%, in the three months ended June 30, 2026 compared to the same period in 2025. The increase was primarily driven by higher airport-related and operational support costs, reflecting increased flight activity and contractual rate increases, as well as higher customer experience-related costs. The increase also reflects lower net gains on asset sale transactions, as gains from current year E190 aircraft sales were lower than prior year period gains from sale-leaseback and engine sale transactions. Other Income (Expense) (in millions; percent changes based on unrounded numbers) Three Months Ended June 30, Year-over-Year Change 2026 2025 $ % Interest expense $ (147) $ (147) $ — 0.4 % Interest income 17 33 (16) (47.3) Capitalized interest 1 3 (2) (63.0) Gain on investments, net 1 3 (2) (65.5) Other (2) 8 (10) NM (1) Total other expense $ (130) $ (100) $ (30) 29.4 % (1) Not meaningful or greater than 100% change. Interest Income Interest income decreased by $16 million, or 47.3%, for the three months ended June 30, 2026 compared to the same period in 2025, driven by lower short-term investment balances. Gain on investments, net Gain on investments, net resulted in a $1 million gain for the three months ended June 30, 2026, compared to a $3 million gain for the same period in 2025, primarily due to lower current year gains related to our JetBlue Technology Ventures LLC ("JBV") equity investments. Income Taxes For the three months ended June 30, 2026, we recorded an income tax benefit of $24 million, compared to an income tax benefit of $20 million for the same period in 2025, with the increase primarily due to an income tax benefit on a higher pre-tax loss partially offset by a valuation allowance for the current period. 29 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS Six Months Ended June 30, 2026 vs. 2025 Overview We reported a net loss of $566 million, an operating loss of $365 million and an operating margin of (7.4)% for the six months ended June 30, 2026. This compares to a net loss of $282 million, an operating loss of $168 million and an operating margin of (3.7)% for the six months ended June 30, 2025. Our loss per share was $1.51 for the six months ended June 30, 2026 compared to a loss per share of $0.79 for the same period in 2025. Net loss increased $284 million year-over-year primarily due to an increase in fuel expense and higher salaries, wages and benefits and other operating expenses, largely attributable to operational disruption events during the year, lower current year net gains related to asset sale transactions, as well as a lower current year income tax benefit. The increases in expense were partially offset by higher revenue driven by stronger demand and increased pricing. Our reported results for the six months ended June 30, 2026 and 2025 included the effects of certain gains on investments. For the six months ended June 30, 2025, our reported results also included the effects of special items. Adjusting for these items, our adjusted net loss (1) was $569 million, adjusted operating loss (1) was $365 million, adjusted operating margin (1) was (7.4)%, and adjusted loss per share (1) was $1.52 for the six months ended June 30, 2026. This compares to an adjusted net loss (1) of $267 million, adjusted operating loss (1) of $144 million, adjusted operating margin (1) of (3.2)%, and adjusted loss per share (1) of $0.75 for the six months ended June 30, 2025. Operating Revenues (Revenues in millions; percent changes based on unrounded numbers) Six Months Ended June 30, Year-over-Year Change 2026 2025 $ % Passenger revenue $ 4,535 $ 4,149 $ 386 9.3 % Other revenue 402 347 55 15.6 Total operating revenues $ 4,937 $ 4,496 $ 441 9.8 % Average fare $ 228.95 $ 215.66 $ 13.29 6.2 % Yield per passenger mile (cents) 16.92 15.82 1.10 7.0 Passenger revenue per ASM (cents) 13.95 12.87 1.08 8.4 Operating revenue per ASM (cents) 15.19 13.95 1.24 8.9 Average stage length (miles) 1,302 1,303 (1) (0.1) Revenue passengers (thousands) 19,809 19,237 572 3.0 Revenue passenger miles (millions) 26,798 26,228 570 2.2 Available seat miles (ASMs) (millions) 32,511 32,242 269 0.8 Load factor 82.4 % 81.3 % 1.1 pts. Passenger revenue is our primary source of revenue, which includes seat revenue and baggage fees, as well as revenue from our ancillary product offerings such as EvenMore®. Passenger revenue increased 9.3% for the six months ended June 30, 2026 compared to the same period in 2025. This was mainly driven by a 7.0% higher yield and a 3.0% increase in revenue passengers than the prior period. Other revenue increased $55 million, or 15.6%, primarily due to higher customer spend related to loyalty revenue from the non-transportation elements of the sale of TrueBlue® points. Other revenue also includes revenue from the sale of vacation packages, airport concessions, charters, advertising, and lounge revenue. We measure capacity in terms of available seat miles, which represents the number of seats available for passengers multiplied by the number of miles the seats are flown. Yield, or the average amount one passenger pays to fly one mile, is calculated by dividing passenger revenue by revenue passenger miles. We attempt to increase passenger revenue by increasing our yield and also increasing our load factor of flights, when possible. Our objective is to optimize our fare mix to increase our overall revenue per available seat mile while continuing to provide our customers with competitive fares. (1) Refer to "Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure. 30 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Operating Expenses In detail, our operating costs per ASM, were as follows: (in millions; per ASM data in cents; percent changes based on unrounded numbers) Six Months Ended June 30, Year-over-Year Change Cents per ASM 2026 2025 $ % 2026 2025 % Change Aircraft fuel $ 1,484 $ 1,015 $ 469 46.2 % 4.56 3.15 45.0 % Salaries, wages and benefits 1,771 1,714 57 3.3 5.45 5.32 2.5 Landing fees and other rents 352 330 22 6.6 1.09 1.02 5.7 Depreciation and amortization 362 339 23 6.7 1.11 1.05 5.8 Aircraft rent 30 39 (9) (23.4) 0.09 0.12 (24.0) Sales and marketing 160 147 13 9.4 0.50 0.45 8.5 Maintenance, materials and repairs 398 389 9 2.3 1.22 1.21 1.4 Special items — 24 (24) (99.4) — 0.07 (99.4) Other operating expenses 745 667 78 11.7 2.29 2.07 10.8 Total operating expenses $ 5,302 $ 4,664 $ 638 13.7 % 16.31 14.47 12.7 % Aircraft Fuel Aircraft fuel increased by $469 million, or 46.2%, for the six months ended June 30, 2026 compared to the same period in 2025. The average fuel price increased by 46.2% to $3.63 per gallon, while fuel consumption was relatively consistent with the prior-year period. Landing Fees and Other Rents Landing fees and other rents increased by $22 million, or 6.6%, for the six months ended June 30, 2026 compared to the same period in 2025, primarily due to rate increases in certain cities and a decrease in airport rent credits received. Depreciation and Amortization Depreciation and amortization increased by $23 million, or 6.7%, for the six months ended June 30, 2026 compared to the same period in 2025. This increase was primarily driven by the induction of new aircraft and spare engines, partially offset by the retirement of the Embraer E190 fleet as part of the Company's fleet transition plan. Aircraft Rent Aircraft rent decreased by $9 million, or 23.4%, in the six months ended June 30, 2026 compared to the same period in 2025, primarily due to fewer leases for Airbus A320 aircraft and Embraer E190 aircraft. As part of the Company's fleet transition plan, Embraer E190 aircraft leases reached their lease expiration and were returned to the lessor. The decrease was partially offset by an increase in the number of leased engines. Sales and Marketing Sales and marketing increased by $13 million, or 9.4%, in the six months ended June 30, 2026 compared to the same period in 2025, primarily due to higher credit card fees as a result of the increase in passenger revenue. Special Items There were no special items for the six months ended June 30, 2026. For the six months ended June 30, 2025, special items consisted of $24 million of voluntary opt-out costs. Other Operating Expenses Other operating expenses increased by $78 million, or 11.7%, in the six months ended June 30, 2026 compared to the same period in 2025. The increase was primarily driven by higher costs associated with operational disruption events, higher airport-related and operational support costs reflecting contractual rate increases, and higher customer experience-related costs. The increase also reflects lower net gains on asset sale transactions, as gains from current year E190 aircraft sales were lower than prior year gains from sale-leaseback and engine sale transactions. 31 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Other Income (Expense) (in millions; percent changes based on unrounded numbers) Six Months Ended June 30, Year-over-Year Change 2026 2025 $ % Interest expense $ (291) $ (295) $ 4 (1.3) % Interest income 40 71 (31) (43.5) Capitalized interest 2 6 (4) (64.3) Gain on investments, net 4 4 — (5.4) Other 3 17 (14) (78.9) Total other expense $ (242) $ (197) $ (45) (22.5) % Interest Income Interest income decreased by $31 million, or 43.5%, for the six months ended June 30, 2026 compared to the same period in 2025. This decrease was primarily driven by lower short-term investment balances. Gain on investments, net Gain on investments, net was $4 million for both the six months ended June 30, 2026 and 2025, primarily reflecting gains related to our JetBlue Technology Ventures LLC ("JBV") equity investments. Other Other income decreased by $14 million, or 78.9%, for the six months ended June 30, 2026 compared to the same period in 2025. This decrease was primarily due to lower income recorded related to our share of equity method investees' financial results compared to the prior year. Income Taxes For the six months ended June 30, 2026, we recorded an income tax benefit of $41 million, compared to an income tax benefit of $83 million for the same period in 2025, with the decrease primarily due to a valuation allowance reflected in the current year forecasted annual effective tax rate. 32 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Operational Statistics The following table sets forth our operating statistics for the three and six months ended June 30, 2026 and 2025: Three Months Ended June 30, Year-over-Year Change Six Months Ended June 30, Year-over-Year Change (percent changes based on unrounded numbers) 2026 2025 % 2026 2025 % Operational Statistics Revenue passengers (thousands) 10,479 9,973 5.1 19,809 19,237 3.0 Revenue passenger miles (RPMs) (millions) 14,192 13,627 4.1 26,798 26,228 2.2 Available seat miles (ASMs) (millions) 17,170 16,634 3.2 32,511 32,242 0.8 Load factor 82.7 % 81.9 % 0.8 pts 82.4 % 81.3 % 1.1 pts Aircraft utilization (hours per day) (1) 10.2 10.2 (0.2) 9.8 10.0 (2.0) Average fare $ 237.38 $ 218.52 8.6 $ 228.95 $ 215.66 6.2 Yield per passenger mile (cents) 17.53 15.99 9.6 16.92 15.82 7.0 Passenger revenue per ASM (cents) 14.49 13.10 10.6 13.95 12.87 8.4 Operating revenue per ASM (cents) 15.71 14.17 10.9 15.19 13.95 8.9 Operating expense per ASM (cents) 16.53 14.13 17.0 16.31 14.47 12.7 Operating expense per ASM, excluding fuel (cents) (2) 11.12 10.86 2.4 11.63 11.15 4.4 Departures 81,647 78,809 3.6 154,167 153,562 0.4 Average stage length (miles) 1,300 1,309 (0.7) 1,302 1,303 (0.1) Average number of operating aircraft during period (1) 294 286 2.8 292 287 1.7 Average fuel cost per gallon $ 4.23 $ 2.40 76.3 $ 3.63 $ 2.48 46.2 Fuel gallons consumed (millions) 215 210 2.5 408 408 — Fuel efficiency (ASMs per fuel gallon) 80 79 0.7 80 79 0.8 Average number of full-time equivalent crewmembers 19,847 18,956 4.7 19,647 19,050 3.1 (1) This table includes aircraft that have been temporarily removed from service, including four aircraft impacted by the Pratt & Whitney engine groundings. All aircraft temporarily removed from service are expected to return to operation in the future. (2) Refer to "Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure. 33 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS LIQUIDITY AND CAPITAL RESOURCES The airline business is capital intensive. Our ability to successfully execute our growth plans is largely dependent on the continued availability of capital on attractive terms. In addition, our ability to successfully operate our business depends on maintaining sufficient liquidity. We believe we have adequate resources from a combination of cash and cash equivalents, investment securities on hand, and available lines of credit. Additionally, our unencumbered assets could be an additional source of liquidity, if necessary. As part of our fleet strategy, we have deferred certain aircraft deliveries in prior periods to better align capacity with demand and reduce near-term capital expenditures. In parallel, we are investing in targeted modifications to certain Airbus A320 aircraft, based on operational needs, to extend useful lives and support more efficient utilization of our existing assets. This strategy is intended to optimize utilization of our existing fleet, enhance financial flexibility, and moderate capital spending in the near term while preserving long-term operational capacity. In connection with these initiatives, we revised the estimated useful lives and residual values of certain aircraft, and reflected prospectively in depreciation expense. While these changes affect depreciation expense, they did not have a material impact on our results of operations. We expect these actions to support our broader objective of navigating demand volatility while strengthening our financial position over time. In the future, we may decide to seek additional financing or to further increase our capital resources by issuing shares of our capital stock, offering debt or other equity securities or refinancing outstanding debt or securities. Issuing additional shares of our capital stock, other equity securities or additional securities convertible into equity may dilute the economic and voting rights of our existing stockholders, reduce the market price of our common stock, or both. Our debt agreements contain various affirmative, negative and financial covenants and complying with certain of these covenants, or entering into agreements with additional covenants, may restrict our ability to pursue our strategy or otherwise constrain our operations. Failure to comply with these covenants could lead to an event of default under the agreements, which may result in, among other things, an acceleration of outstanding obligations under such agreements. Our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, which may adversely affect the availability, amount, timing, or nature of our future offerings. As a result, holders of our common stock bear the risk that our future offerings may reduce the market price of our common stock and dilute their percentage ownership. In July 2026, the Company was selected as the successful bidder to acquire certain operating authorizations (slots) previously operated by Spirit Airlines at New York's LaGuardia Airport for an aggregate purchase price of $58.5 million. If completed, the acquisition would support up to 12 daily roundtrips at LaGuardia. The transaction closing remains subject to regulatory approvals and other conditions. At June 30, 2026, we had unrestricted cash, cash equivalents, and investment securities of $2.2 billion. We also have a $600 million Citibank undrawn line of credit. We believe this will be sufficient to satisfy our liquidity needs for at least the next 12 months from the date of this Report, and we expect to meet our long-term liquidity needs with our projected cash from operations, available lines of credit and debt financing. On April 1, 2026, the Company paid in full its 0.50% convertible senior notes due 2026, including $325 million of principal and $1 million of interest. A portion of this payment was funded using amounts previously held in escrow pursuant to the Company's revolving credit facility agreement with Citibank. Following this repayment, the Company has no remaining obligations under these notes. On April 14, 2026, the Company entered into an agreement providing for up to $500 million in debt financing, secured by certain owned A321, A320, and A220 aircraft. As of June 30, 2026, the Company borrowed an aggregate of $500 million under the agreement. The borrowings have maturities ranging from 2033 through 2036 and interest rates based on U.S. Treasury rates plus an applicable margin. In addition, the agreement provides for the potential to obtain up to an additional $250 million in incremental aircraft-secured financing beyond the initial $500 million commitment, subject to agreed upon terms. We believe a healthy liquidity position is a crucial element of our ability to weather any part of the economic cycle while continuing to execute on our plans for profitable growth and increased returns. Our goal is to continue to be diligent with our liquidity, maintain financial flexibility, and be prudent with capital spending. 34 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Analysis of Cash Flows Operating Activities We use operating cash flows to provide working capital for current and future operations. Cash flows used in operating activities were $35 million and $1 million for the six months ended June 30, 2026 and 2025, respectively. The increase in cash flows used in operating activities is primarily due to higher operating losses driven by increased fuel costs, salaries, wages and benefits, and other operating expenses, including costs associated with operational disruption events. These impacts were partially offset by higher revenue, driven by stronger demand and pricing, and favorable changes in working capital, particularly an increase in air traffic liability. Investing Activities During the six months ended June 30, 2026, flight equipment capital expenditures included $251 million related to the purchase of aircraft and spare engines as well as aircraft interior modifications. Flight capital expenditures also included $34 million in spare part purchases and $27 million in aircraft pre-delivery deposit payments. Other property and equipment capital expenditures included ground equipment purchases and facilities improvements for $49 million, software purchases for $12 million, and a $2 million deposit for the purchase of LaGuardia slots. Investing activities for the current year also included $21 million in net proceeds from investment securities, $71 million of proceeds primarily from the sale of Embraer E190 airframes, Embraer E190 engines, and other flight equipment, and net $6 million for other investing activities. During the six months ended June 30, 2025, flight equipment capital expenditures included $358 million related to the purchase of aircraft and spare engines as well as aircraft interior modifications. Flight capital expenditures also included $44 million in spare part purchases and $23 million in aircraft pre-delivery deposit payments. Other property and equipment capital expenditures included ground equipment purchases and facilities improvements for $71 million. Investing activities also included $804 million in net proceeds from investment securities and $121 million of proceeds from the sale of assets and sale-leaseback transactions. Financing Activities Financing activities for the six months ended June 30, 2026 primarily consisted of $495 million in net proceeds from issuance of long-term debt, $570 million in payments on our outstanding debt and finance lease obligations, and issuance of common stock of $19 million related to our crewmember stock purchase plan. Financing activities for the six months ended June 30, 2025 primarily consisted of $228 million in payments on our outstanding debt and finance lease obligations and issuance of common stock of $30 million related to our crewmember stock purchase plan. Working Capital We had a working capital deficit of $1.4 billion at June 30, 2026 and working capital deficit of $1.2 billion at December 31, 2025, respectively. Our working capital decreased by $213 million due to an increase in air traffic liability and decreases in cash and cash equivalents and current portion of restricted cash. These impacts were partially offset by lower current maturities of long-term debt following the repayment of our 0.50% convertible senior notes due in 2026, as well as increases in investment securities and inventory. We expect to meet our obligations as they become due through available cash, investment securities, and internally generated funds, supplemented, as necessary, by financing activities which may be available to us. However, we cannot predict what the effect on our business might be from future developments related to the extremely competitive environment in which we operate, or from events beyond our control, such as volatile or increasing fuel prices, economic conditions, the effectiveness and timing of our efforts to increase fees and fares to align with volatile input costs, weather-related disruptions, airport infrastructure challenges, the spread of infectious diseases, the impact of other airline bankruptcies, restructurings or consolidations, U.S. or international military actions, acts of terrorism, or other external geopolitical events and conditions. We believe there is sufficient liquidity available to us to meet our cash requirements for at least the next 12 months. 35 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS CONTRACTUAL OBLIGATIONS Our material cash requirements for known contractual and other obligations includes the following (in millions): Remainder of 2026 2027 2028 2029 2030 Thereafter Total Debt and finance lease obligations (1) $ 529 $ 1,043 $ 1,117 $ 2,314 $ 1,040 $ 5,268 $ 11,311 Operating lease obligations (2) 81 146 111 89 84 937 1,448 Flight equipment purchase obligations (3) 337 383 525 444 338 3,444 5,471 Other obligations (4) 211 397 433 289 313 7 1,650 Total $ 1,158 $ 1,969 $ 2,186 $ 3,136 $ 1,775 $ 9,656 $ 19,880 The amounts stated above do not include additional obligations incurred as a result of financing activities executed after June 30, 2026, except as otherwise noted. (1) Includes actual interest and estimated interest for floating-rate debt. Estimated floating rate is equal to Secured Overnight Financing Rate ("SOFR") plus a margin based on June 30, 2026 rates. (2) Primarily relates to JFK Terminal 5, aircraft and spare engines, and our corporate office in Long Island City. (3) Includes obligations for one Airbus A321neo XLR variant aircraft which is expected to be sold following delivery of the aircraft. The aircraft is anticipated to deliver in the third quarter of 2026. (4) Amounts primarily include non-cancelable commitments for flight equipment maintenance, infrastructure and information technology. As of June 30, 2026, we were in compliance with the material covenants of our debt and lease agreements. In August 2024, JetBlue co-issued with JetBlue Loyalty LP, the TrueBlue® Notes and TrueBlue® Term Loan Facility. The agreements governing the TrueBlue® Notes and TrueBlue® Term Loan Facility contain affirmative, negative and financial covenants including compliance with certain debt service coverage ratios and minimum liquidity requirements. These agreements also contain events of default, including a cross-default to other material indebtedness. We have $58 million of restricted cash pledged under standby letters of credit related to certain leases that will expire at the end of the related lease terms. Approximately 67% of our owned property and equipment and intangible assets at net book value were pledged or committed to be pledged as security under various loan agreements. 36 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Aircraft As of June 30, 2026, our operating fleet consisted of (1), (2): Aircraft Type Aircraft Count Airbus A220 65 Airbus A320 8 Airbus A320 Restyled 121 Airbus A321 28 Airbus A321 with Mint® 35 Airbus A321neo 16 Airbus A321neo with Mint® 12 Airbus A321neoLR with Mint® 11 Total 296 (1) Excludes one Airbus A321neo XLR variant owned aircraft included in assets held for sale. (2) Includes aircraft that have been temporarily removed from service but are expected to return to operation in the future. Of our operating fleet, 286 are owned by us and 10 are leased under operating leases. Our owned aircraft include aircraft associated with sale-leaseback transactions that did not qualify as sales for accounting purposes, also referred to as failed sale-leasebacks. As of June 30, 2026, the average age of our operating fleet was 12 years. Embraer E190 Fleet Transition In 2025, as part of the Company's fleet transition plan, we retired our remaining Embraer E190 aircraft and entered into definitive agreements to sell the remaining E190 fleet. During the six months ended June 30, 2026, we sold our remaining owned Embraer E190 airframes, as well as certain Embraer E190 engines and related spare parts, and recorded a net gain of $30 million, which is included in other operating expenses on our consolidated statements of operations. We also returned our remaining leased E190 aircraft. As of June 30, 2026, one Embraer E190 engine and certain related spare parts remained available for sale. 37 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Flight Equipment Deliveries As of June 30, 2026, our committed aircraft deliveries include the following aircraft (1): Year Airbus A220 Airbus A321neo (2) Total Remainder of 2026 6 1 7 2027 7 — 7 2028 11 — 11 2029 10 — 10 2030 1 2 3 Thereafter — 42 42 Total (3) 35 45 80 (1) The timing of aircraft deliveries and related committed expenditures presented in the table above is based on contractual delivery schedules, adjusted for delivery delays based on management’s current expectations as of the date of this filing. These expectations reflect recent communications from Airbus regarding delivery delays resulting from global supply chain disruptions. Actual delivery timing may differ from the periods presented and remains subject to change due to manufacturer production schedules, supply chain constraints, contractual modifications, regulatory matters and other factors. (2) Includes one Airbus A321neo XLR variant aircraft which is expected to be sold following delivery of the aircraft. The aircraft is anticipated to deliver in the third quarter of 2026. (3) In addition, we have options to purchase 20 A220-300 aircraft in 2028 through 2030. Committed expenditures for our firm aircraft and spare engines include estimated amounts for contractual price escalations and pre-delivery deposits. We expect to meet our pre-delivery deposit requirements for our aircraft by paying cash or by using short-term borrowing facilities for deposits generally required six to 24 months prior to delivery. Any pre-delivery deposits paid by the issuance of notes are fully repaid at the time of delivery of the related aircraft. Depending on market conditions, we may use a mix of cash and debt financing for aircraft scheduled for delivery in the remainder of 2026. Although we believe debt and/or lease financing should continue to be available to us, we cannot give any assurance that we will be able to secure financing on attractive terms, if at all. To the extent we cannot secure financing on terms we deem attractive, we may be required to pay in cash, further modify our aircraft acquisition plans, or incur higher than anticipated financing costs. Off-Balance Sheet Arrangements There have been no material changes to off-balance sheet arrangements from the information provided in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations-Off Balance Sheet Arrangements included in our 2025 Form 10-K. Critical Accounting Policies and Estimates There have been no material changes to our critical accounting policies and estimates from the information provided in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations-Critical Accounting Policies and Estimates included in our 2025 Form 10-K. 38 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS REGULATION G RECONCILIATION OF NON-GAAP FINANCIAL MEASURES We report our financial results in accordance with GAAP; however, we present certain non-GAAP financial measures in this Report. Non-GAAP financial measures are financial measures that are derived from the condensed consolidated financial statements, but that are not presented in accordance with GAAP. We present these non-GAAP financial measures because we believe they provide useful supplemental information that enables a meaningful comparison of our results to others in the airline industry and our prior year results. Investors should consider these non-GAAP financial measures in addition to, and not as a substitute for, our financial performance measures prepared in accordance with GAAP. Further, our non-GAAP information may be different from the non-GAAP information provided by other companies. The information below provides an explanation of each non-GAAP financial measure used in this Report and shows a reconciliation of certain non-GAAP financial measures to its most directly comparable GAAP financial measure. Operating Expenses, excluding Fuel, Other Non-Airline Operating Expenses, and Special Items ("Operating Expenses ex-fuel") and Operating Expense ex-fuel per Available Seat Mile ("CASM ex-fuel") Operating Expense per Available Seat Mile ("CASM") is a common metric used in the airline industry. Our CASM for the relevant periods are summarized in the table below. We exclude aircraft fuel, operating expenses related to other non-airline businesses, such as Paisly and JetBlue Technology Ventures (JBV), and special items from total operating expenses to determine Operating Expenses ex-fuel, which is a non-GAAP financial measure, and we exclude the same items from CASM to determine CASM ex-fuel, which is also a non-GAAP financial measure. We believe the impact of these special items distorts our overall trends and that our metrics are more comparable with the presentation of our results excluding such impact. For the three and six months ended June 30, 2026, there were no special items. For each of the three and six months ended June 30, 2025, special items included voluntary opt-out costs. We believe Operating Expenses ex-fuel and CASM ex-fuel are useful for investors because they provide investors the ability to measure our financial performance excluding items that are beyond our control, such as fuel costs, which are subject to many economic and political factors, as well as items that are not related to the generation of an available seat mile, such as operating expense related to certain non-airline businesses and special items. We believe these non-GAAP measures are more indicative of our ability to manage airline costs and are more comparable to measures reported by other major airlines. The table below provides a reconciliation of our total operating expenses (GAAP measure) to Operating Expenses ex-fuel, and our CASM to CASM ex-fuel for the periods presented. NON-GAAP FINANCIAL MEASURE RECONCILIATION OF OPERATING EXPENSE AND OPERATING EXPENSE PER ASM (CASM), EXCLUDING FUEL Three Months Ended June 30, $ Cents per ASM (in millions; per ASM data in cents; percent changes based on unrounded numbers) 2026 2025 Percent Change 2026 2025 Percent Change Total operating expenses $ 2,838 $ 2,350 20.8 16.53 14.13 17.0 Less: Aircraft fuel 911 504 80.7 5.31 3.03 75.1 Other non-airline expenses 18 16 10.1 0.10 0.10 6.6 Special items — 24 (99.4) — 0.14 (99.4) Operating expenses, excluding fuel $ 1,909 $ 1,806 5.7 11.12 10.86 2.4 39 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NON-GAAP FINANCIAL MEASURE RECONCILIATION OF OPERATING EXPENSE AND OPERATING EXPENSE PER ASM (CASM), EXCLUDING FUEL Six Months Ended June 30, $ Cents per ASM (in millions; per ASM data in cents; percent changes based on unrounded numbers) 2026 2025 Percent Change 2026 2025 Percent Change Total operating expenses $ 5,302 $ 4,664 13.7 16.31 14.47 12.7 Less: Aircraft fuel 1,484 1,015 46.2 4.56 3.15 45.0 Other non-airline expenses 36 32 11.8 0.12 0.10 10.9 Special items — 24 (99.4) — 0.07 (99.4) Operating expenses, excluding fuel $ 3,782 $ 3,593 5.3 11.63 11.15 4.4 Operating Expense, Operating Income (Loss), Operating Margin, Pre-tax Loss, Pre-tax Margin, Net Loss and Loss per Share, excluding Special Items and Gain on Investments For the three and six months ended June 30, 2026, there were no special items. For each of the three and six months ended June 30, 2025, special items included voluntary opt-out costs. Certain gains on our investments, net were also excluded from our June 30, 2026 and 2025 non-GAAP results. We believe the impact of these items distort our overall trends and that our metrics are more comparable with the presentation of our results excluding the impact of these items. The table below provides a reconciliation of our GAAP reported amounts to the non-GAAP amounts excluding the impact of these items for the periods presented. NON-GAAP FINANCIAL MEASURE RECONCILIATION OF OPERATING EXPENSE, OPERATING INCOME (LOSS), OPERATING MARGIN, PRE-TAX LOSS, PRE-TAX MARGIN, NET LOSS, LOSS PER SHARE, EXCLUDING SPECIAL ITEMS AND GAIN ON INVESTMENTS Three Months Ended June 30, Six Months Ended June 30, (in millions except percentages) 2026 2025 2026 2025 Total operating revenues $ 2,697 $ 2,356 $ 4,937 $ 4,496 RECONCILIATION OF OPERATING EXPENSE Total operating expenses $ 2,838 $ 2,350 $ 5,302 $ 4,664 Less: Special items — 24 — 24 Total operating expenses excluding special items $ 2,838 $ 2,326 $ 5,302 $ 4,640 Percent change 22.0 % 14.3 % RECONCILIATION OF OPERATING INCOME (LOSS) Operating income (loss) $ (141) $ 6 $ (365) $ (168) Add back: Special items — 24 — 24 Operating income (loss) excluding special items $ (141) $ 30 $ (365) $ (144) RECONCILIATION OF OPERATING MARGIN Operating margin (5.2) % 0.3 % (7.4) % (3.7) % Operating income (loss) excluding special items $ (141) $ 30 $ (365) $ (144) Total operating revenues 2,697 2,356 4,937 4,496 Adjusted operating margin (5.2) % 1.3 % (7.4) % (3.2) % 40 Table of Contents PART I. FINANCIAL INFORMATION ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS NON-GAAP FINANCIAL MEASURE RECONCILIATION OF OPERATING EXPENSE, OPERATING INCOME (LOSS), OPERATING MARGIN, PRE-TAX LOSS, PRE-TAX MARGIN, NET LOSS, LOSS PER SHARE, EXCLUDING SPECIAL ITEMS AND GAIN ON INVESTMENTS Three Months Ended June 30, Six Months Ended June 30, (in millions except percentages) 2026 2025 2026 2025 RECONCILIATION OF PRE-TAX LOSS Loss before income taxes $ (271) $ (94) $ (607) $ (365) Add back: Special items — 24 — 24 Less: Gain on investments, net 1 3 4 4 Loss before income taxes excluding special items and gain on investments $ (272) $ (73) $ (611) $ (345) RECONCILIATION OF PRE-TAX MARGIN Pre-tax margin (10.0) % (4.0) % (12.3) % (8.1) % Loss before income taxes excluding special items and gain on investments $ (272) $ (73) $ (611) $ (345) Total operating revenues 2,697 2,356 4,937 4,496 Adjusted pre-tax margin (10.1) % (3.1) % (12.4) % (7.7) % RECONCILIATION OF NET LOSS Net loss $ (247) $ (74) $ (566) $ (282) Add back: Special items — 24 — 24 Less: Income tax benefit related to special items — 6 — 6 Less: Gain on investments, net 1 3 4 4 Less: Income tax expense related to gain on investments, net (1) (1) (1) (1) Net loss excluding special items and gain on investments $ (247) $ (58) $ (569) $ (267) CALCULATION OF LOSS PER SHARE Loss per common share Basic $ (0.66) $ (0.21) $ (1.51) $ (0.79) Add back: Special items — 0.07 — 0.07 Less: Income tax benefit related to special items — 0.02 — 0.02 Less: Gain on investments, net — — 0.01 0.01 Less: Income tax expense related to gain on investments, net — — — — Basic excluding special items and gain on investments $ (0.66) $ (0.16) $ (1.52) $ (0.75) Diluted $ (0.66) $ (0.21) $ (1.51) $ (0.79) Add back: Special items — 0.07 — 0.07 Less: Income tax benefit related to special items — 0.02 — 0.02 Less: Gain on investments, net — — 0.01 0.01 Less: Income tax expense related to gain on investments, net — — — — Diluted excluding special items and gain on investments $ (0.66) $ (0.16) $ (1.52) $ (0.75) 41 Table of Contents PART I. FINANCIAL INFORMATION