Q1 2024 JetBlue Airways Corp Earnings Call

Okay.

James: Good morning, My name is James I'd like to welcome everyone to the Jetblue Airways first quarter 2024 earnings conference call.

Operator: Good morning, my name is James. I'd like to welcome everyone to the JetBlue Airways first quarter 2024 earnings conference call. As a reminder, today's call is being recorded. At this time, all participants are in a listen-only mode. I would now like to turn the call over to JetBlue's Director of Investor Relations, Koosh Patel. Please go ahead, sir.

James: A reminder, today's call is being recorded at this time all participants are in a listen only mode.

James: Now like to turn the call over to Jetblue as director of Investor Relations <unk>. Please go ahead Sir.

Speaker Change: Thanks, James Good morning, everyone and thanks for joining us for our first quarter 2024 earnings call. This morning, we issued our earnings release and the presentation that we will reference during this call.

Koosh Patel: Good morning, everyone, and thanks for joining us for our first quarter 2024 earnings call. This morning, we issued our earnings release and the presentation that we will reference during this call. All of those documents are available on our website at investor.jetblue.com and on the SEC's website at www.sec.gov. In New York to discuss our results are Joanna Geraghty, our Chief Executive Officer, Marty St. George, our President, and Ursula Hurley, our Chief Financial Officer. Also joining us for Q&A is Dave Clark, our former Head of Revenue and Planning and newly appointed Head of Financial Planning and Analysis, Investor Relations, and Strategy.

Jetblue: All of those documents are available on our website at investors at Jetblue Dot com and on the Sec's website at Www SEC Gov.

Jetblue: In New York to discuss our results are Joanna Geraghty, our Chief Executive Officer, Marty St. George Our President and Ursula Hurley, Our Chief Financial Officer also joining us for Q&A is Dave Clark, our former head of revenue and planning and newly appointed head of Finance financial planning and analysis Investor Relations and strategy turning today's call. We will make forward looking statements within the meat.

Koosh Patel: Turning to today's call, we will make forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, without limitation, statements regarding our second quarter and full year 2024 financial outlook and our future results of operations and financial position, industry, market trends, expectations with respect to tailwinds and headwinds, our ability to achieve operational and financial targets, our business strategy and plans for future operations, and the associated impacts on our business.

Jetblue: The safe Harbor provisions of the private Securities Litigation Reform Act of 1995, such forward looking statements include without limitation statements regarding our second quarter and full year 2024 financial outlook and our future results of operations and financial position industry market trends expectations with with.

Jetblue: With respect to tailwind as it happens our ability to achieve operational and financial targets, our business strategy and plans for future operations and the associated impacts on our business. All such forward looking statements are subject to risks and uncertainties and actual results may differ materially from these expressed or implied in these statements.

Koosh Patel: All such forward-looking statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in these statements. Please refer to our most recent earnings release as well as our fiscal year 2023 10-K and other filings for a more detailed discussion of the risks and uncertainties that could cause actual results to differ materially from those contained within our forward-looking standards, and the statements made during today's call. It is made only as of the date of the call.

Jetblue: Please refer to our most recent earnings release as well as our fiscal year 2023, 10-K, and other filings for a more detailed discussion of the risks and uncertainties that could cause actual results to differ materially from those contained within our forward looking statements. The statements made during today's call.

Jetblue: Are made only as of the date of the call.

Jetblue: And other than as may be required by law, we undertake no obligation to update the information investors should not place undue reliance on these forward looking statements also during the course of our call. We may discuss certain non-GAAP financial measures for an explanation of these non-GAAP measures and a reconciliation to the corresponding GAAP measures. Please refer to our earnings release, a copy of which is available on our web.

Koosh Patel: And other than as may be required by law, we undertake no obligation to update the information. Investors should not place undue reliance on these forward-looking statements. Also, during the course of our call, we may discuss certain non-GAAP financial measures. For an explanation of these non-GAAP measures and a reconciliation to the corresponding GAAP measures, please refer to our earnings release, a copy of which is available on our website and on sec.gov. And now I'd like to turn the call over to Joanna Geraghty, JetBlue's CEO.

Jetblue: And at SEC Gov, and now I'd like to turn the call over to Joanna guarantee Jetblue CEO. Thank you and good morning, everyone and thanks for joining US today, it's been a busy start to the year, but the spirit transaction now resolved we are moving quickly to execute on our refocused Standalone plan, our first quarter beat demonstrates our sense of urgency.

Joanna L. Geraghty: Thank you, Koosh. Good morning, everyone, and thanks for joining us today. It's been a busy start to the year. With the Spirit transaction now resolved, we are moving quickly to execute on our refocused standalone plan. Our first quarter beat demonstrates our sense of urgency.

Joanna L. Geraghty: And while we are adjusting our full-year guidance to reflect headwinds in our Latin flying associated with continued elevated capacity in the region, our early progress supports our confidence that we are building the right plan to create long-term sustainable value for our owners and all of our stakeholders. As always, the success of our efforts depends on our crew members, and they are stepping up for JetBlue every day. I would like to thank each of them, first and foremost, for running a safe operation and ensuring a strong safety culture.

Joanna L. Geraghty: And while we are adjusting our full year guidance to reflect headwinds in our Latin flying associated with continued elevated capacity in the region. Our early progress supports our confidence that we are building the right plan to create long term sustainable value for our owners and all of our stakeholders.

Joanna L. Geraghty: As always the success of our efforts depends on our crew members and they are stepping up for Jetblue every day I would like to thank each of them first and foremost we're running a safe operation and ensuring a strong safety culture I'd also like to thank them for supporting one another and our customers as they strive to deliver an outstanding experience every day there.

Joanna L. Geraghty: I'd also like to thank them for supporting one another and our customers as they strive to deliver an outstanding experience every day. Their actions contributed to our better first quarter performance, which included generating an adjusted pre-tax profit for the month of March. In my first two months in this role, building the right senior leadership team has been a top priority. We've been able to appoint several seasoned leaders into key roles, including attracting great outside talent, giving us an ideal mix of expertise and skills at a pivotal time for JetBlue.

Joanna L. Geraghty: Actions contributed to our better first quarter performance, which included generating an adjusted pre tax profit for the month of March.

Joanna L. Geraghty: In my first two months in this role building the right senior leadership team has been a top priority we've been able to appoint several seasoned leaders into key roles, including attracting great outside talent, giving us an ideal mix of expertise and skills at a pivotal time for jetblue.

Joanna L. Geraghty: In addition to Warren's promotion to Chief Operating Officer in January, we welcomed Marty St. George back to JetBlue in February as our new president. It's great to have Marty back here and on the call with us today.

Joanna L. Geraghty: In addition to warrants promotion to Chief operating Officer in January we welcomed Marty St. George back to Jetblue in February as our new President it's great to have Marty back here and on the call with US today. In addition last week, we announced that Daniel shares has joined Jetblue as our new head of revenue networking Enterprise planning Daniel has an impressive track record in the industry and.

Joanna L. Geraghty: In addition, last week we announced that Daniel Schurz has joined JetBlue as our new Head of Revenue, Network, and Enterprise Planning. Daniel has an impressive track record in the industry and is ready to hit the ground running. Dave Clark, who has demonstrated his capabilities over the past 15 years at JetBlue and is already familiar to many on this call, is transitioning to lead financial planning and analysis, investor relations, and strategy. Among our new leadership team, it's essential that we have alignment on our path forward.

Joanna L. Geraghty: It's ready to hit the ground running Dave Clark, who has demonstrated his capabilities over the past 15 years at Jetblue and is already familiar to many on this call. It's transitioning to lead financial planning and analysis Investor Relations and strategy.

Joanna L. Geraghty: Among our new leadership team, it's essential that we have alignment on our path forward I want to ensure they have sufficient time to pressure test our strategy and frankly began executing on more of it before we communicate our long term plans to investors. We also need to make additional progress with Pratt and Whitney for our team to feel confident in our multiyear growth plans with.

Joanna L. Geraghty: I want to ensure they have sufficient time to pressure test our strategy and, frankly, begin executing on more of it before we communicate our long-term plans to investors. We also need to make additional progress with Pratt & Whitney for our team to feel confident in our multi-year growth plans. With these things in mind, we are shifting our investor day from May 30 to the fall of this year.

Joanna L. Geraghty: These things in mind, we are shifting our investor day from May 30th to the fall of this year with that said, we remain bias towards action as reflected by the steps we are already taking including resolving the spirit transaction differing Airbus deliveries announcing meaningful network changes implementing new ancillary fee initiatives implementing.

Joanna L. Geraghty: With that said, we remain biased toward action, as reflected by the steps we are already taking, including resolving the Spirit transaction, delaying Airbus deliveries, announcing meaningful network changes, implementing new ancillary fee initiatives, implementing early pieces of our multi-year reliability initiative, and announcing key members of the senior leadership team. As we work toward Investor Day, we will continue to implement early pieces of the strategy in the weeks and months ahead Now, turning to slide three.

Joanna L. Geraghty: Early pieces of our multiyear reliability initiative and announcing key members of the senior leadership team as we work toward Investor Day, We will continue to implement early pieces of the strategy in the weeks and months ahead.

Joanna L. Geraghty: Now turning to slide three during the first quarter of 2024, we began expeditiously implementing our strategic priorities. The investments we've made to build resiliency and recoverability into our schedule enabled us to complete more flights than planned despite facing weather events, which were more severe and greater frequency than last year.

Joanna L. Geraghty: During the first quarter of 2024, we began expeditiously implementing our strategic priorities. The investments we've made to build resiliency and recoverability into our schedule enabled us to complete more flights than planned, despite facing weather events that were more severe and with greater frequency than last year. These investments have also benefited us financially, setting the foundation to generate more revenue and better control our costs, while positioning us to deliver a better experience for our customers.

Joanna L. Geraghty: These investments also benefited us financially setting the foundation to generate more revenue and better control our costs, while positioning us to deliver a better experience for our customers as a result, I am pleased to share that our year over year revenue performed at the better end of our initial guidance metrics, while both capacity and unit costs exceeded the better.

Joanna L. Geraghty: As a result, I am pleased to share that our year-over-year revenue performed at the better end of our initial guidance metrics, while both capacity and unit costs exceeded the better end of their respected updated ranges, all of which was well ahead of our original guidance. As we look ahead, we are continuing to work with urgency to strengthen our competitive position. As we discussed last quarter, demand trends in our core geographies and from our core customers have changed considerably since before the pandemic.

Joanna L. Geraghty: Their respected updated ranges all of which was well ahead of our original guidance as.

Joanna L. Geraghty: As we look ahead, we are continuing to work with urgency to strengthen our competitive position.

Joanna L. Geraghty: As we discussed last quarter demand trends in our core geographies and from our core customers have changed considerably since before the pandemic. Many of these changes play to Jetblue strength for instance, leisure travel remains an increasing priority for customers and there is no longer the same divide between corporate and leisure travel as more people can take advantage of the ability.

Joanna L. Geraghty: Many of these changes play to JetBlue's strengths. For instance, leisure travel remains an increasing priority for customers, and there is no longer the same divide between corporate and leisure travel, as more people can take advantage of the ability to work from anywhere.

Joanna L. Geraghty: To work from anywhere however that also means most of the industry has shifted a portion of their flying to meet this increasing demand for leisure travel allocating capacity to many of Jetblue, the bread and butter routes.

Joanna L. Geraghty: However, that also means most of the industry has shifted a portion of their flying to meet this increasing demand for leisure travel, allocating capacity to many of JetBlue's bread-and-butter routes. Specifically, we continue to see elevated capacity in the Latin region, which represents 35% of our total ASMs and is one of our most valuable and profitable geographies. The elevated capacity in this region is significantly pressuring the overall revenue acceleration we expected to see from the first quarter into the second quarter. We've therefore revised our full-year guidance and no longer expect to approach break-even adjusted operating margin for the full year.

Joanna L. Geraghty: Specifically, we continue to see elevated capacity and the Latin region, which represents 35% of our total ASM and is one of our most valuable and profitable geographies. The elevated capacity in this region is significantly pressuring the overall revenue acceleration, we expected to see from the first quarter into the second quarter.

Therefore revised our full year guidance and no longer expect to approach breakeven adjusted operating margin for the full year, Marty and Ursula will share more on our outlook for the second quarter and full year, but before we get to the remarks I want to stress the confidence I have in the near term actions, we are taking and our long term plan to return to profitability again, we've made.

Joanna L. Geraghty: Marty and Ursula will share more on our outlook for the second quarter and full year, but before we get to their remarks, I want to stress the confidence I have in the near-term actions we are taking and our long-term plan to return to profitability again. We've made progress, and we know we need to continue to do more. Since our last earnings call, we've taken significant steps to rebalance our network, and we expect to continue implementing additional tranches in the coming weeks and months, including trimming capacity in the fall trough to better match supply with demand. Given we are not yet profitable and not growing this year, we have increased the hurdle rate of underperforming markets and, as a result, have announced the closure of seven Blue Cities.

Joanna L. Geraghty: <unk> and we know we need to continue to do more.

Speaker Change: Since our last earnings call, we've taken significant steps to rebalance our network and we expect to continue implementing additional tranches in the coming weeks and months, including trimming capacity in the fall trough to better match supply with demand.

Speaker Change: Given we are not yet profitable and not growing this year, we have increased the hurdle rate of underperforming markets and as a result have announced the closure of seven blue cities. It is never an easy decision for us to close the station and I want to extend a heartfelt. Thank you to the crew members in those blue cities for their dedication to Jetblue and.

Speaker Change: In addition to significant network changes, we're making solid progress on the $300 million of revenue initiatives, we announced during our FERC fourth quarter call, which Marty will elaborate on further our team is moving swiftly to continue to launch a number of these initiatives over the remainder of this year and we remain on track to achieve the $300 million of <unk>.

Joanna L. Geraghty: It is never an easy decision for us to close a station, and I want to extend a heartfelt thank you to the crew members in those Blue Cities for their dedication to JetBlue. In addition to significant network changes, we're making solid progress on the $300 million of revenue initiatives we announced during our fourth-quarter call, which Marty will elaborate on further. Our team is moving swiftly to continue to launch a number of these initiatives over the remainder of this year.

Speaker Change: <unk> topline benefit in the fourth quarter with additional ramp expected into 2025 as these initiatives achieve their full revenue potential.

Speaker Change: As we advance these initiatives and as we evaluate industry wide changes. We're also rigorously assessing the evolving needs and preferences of our core customers, particularly in how we merchandize our product offering and the experience. They receive onboard we know there are still gaps in our product offering where our customers' needs may not be fully met.

Joanna L. Geraghty: And we remain on track to achieve the $300 million of cumulative top-line benefit in the fourth quarter, with additional ramp-up expected into 2025 as these initiatives achieve their full revenue potential. As we advance these initiatives, and as we evaluate industry-wide changes, we are also rigorously assessing the evolving needs and preferences of our core customers, particularly in how we merchandise our product offering and the experience they receive on board. We know there are still gaps in our product offering where our customers' needs may not be fully met, and our team is working swiftly to address them.

Speaker Change: And our team is working swiftly to address them.

Speaker Change: Finally, a key component of our work to return our business to profitability is ensuring we maintain a low cost base in a year, where we're not growing it is imperative that we right size, our fixed cost base to the current operating environment to that end action several initiatives in the first quarter, such as offering a voluntary opt out program continuing.

Speaker Change: To optimize our real estate footprint and leveraging technology to help us make decisions more efficiently.

Joanna L. Geraghty: Finally, a key component of our work to return our business to profitability is ensuring that we maintain a low cost base. In a year where we are not growing, it is imperative that we right-size our fixed cost base to the current operating environment. To that end, we implemented several initiatives in the first quarter, such as offering a voluntary opt-out program, continuing to optimize our real estate footprint, and leveraging technology to help us make decisions more efficiently.

Speaker Change: Across the board, we are acting quickly to take self help measures and advance our refocused strategy to return to profitability again I am confident the benefits of this plan will help us to more effectively compete in our core geographies.

Speaker Change: And coupled with our low cost base strong brand and the industry's best crew members will distinguish us from the competition and set jetblue up for long term success.

Speaker Change: I'd like to close by extending another thank you to our crew members for their continued commitment to delivering a safe experience for our customers and for each other and what another each day the safety of our crew members and customers has always been our top priority and we as our number one value will continue to stress the importance of it and everything that we do.

Joanna L. Geraghty: Across the board, we are acting quickly to take self-help measures and advance our refocused strategy to return to profitability again. I am confident the benefits of this plan will help us to more effectively compete in our core geography.

Speaker Change: I will now pass it over to Marty who I'm excited to welcome back to Jetblue. While it is not your first earnings call with US It has been a while and I know I speak for all of US when I say, how happy we are to have you back in the room over to you Marty.

Joanna L. Geraghty: And, coupled with our low-cost base, strong brand, and the industry's best crew members, it will distinguish us from the competition and set JetBlue up for long-term success. I'd like to close by extending another thank you to our crew members for their continued commitment to delivering a safe experience for our customers and for each other and one another each day. The safety of our crew members and customers has always been our top priority, and we, as our number one value, will continue to stress the importance of it in everything that we do.

Marty: Thank you Joanna let.

Marty: Let me start by saying, how thrilled I am to be back at Jetblue at such a pivotal moment for our business I see so much opportunity ahead.

Marty: Jetblue has an exceptional brand incredibly high value geographies and the strategies that I am excited to execute on.

Marty: Most importantly, we have the industry's best crew members has.

Marty: It's been great to reconnect with so many of our talented crew members over the past several weeks and.

Joanna L. Geraghty: I will now pass it over to Marty, who I'm excited to welcome back to JetBlue. While this is not your first earnings call with us, it has been a while, and I know I speak for all of us when I say how happy we are to have you back in the room. Thank you, Joanna.

Marty: And I'd like to Echo Joanna and adding my thanks for all that you do for our customers and for each other.

Marty: Turning to slide five for the first quarter capacity contracted 7% exceeding our guidance as a continued focus on operational liability drove a strong completion factor of 98, 7% exceeding plan.

Marty St. George: Thank you, Joanna. Let me start by saying how thrilled I am to be back at JetBlue at such a pivotal moment for our business. I see so much opportunity ahead. JetBlue has an exceptional brand, incredibly high-value geographies, and a strategy that I am excited to execute on. Most importantly, we have the industry's best crew members. It's been great to reconnect with so many of our talented crew members over the past several weeks. And I'd like to echo Joanna in adding my thanks for all that you do for our customers and for each other. Turn to slide five.

Marty: This reflects the strong execution by the team and the planning we have done to position of operation to respond more effectively to operational disruptions.

Marty: Looking ahead, we expect second quarter capacity to be down 2% to 5% year over year.

Marty: Driven primarily by the continued headwinds we faced related to the GTS engine issues first we will provide more detail on that front and as you'll hear we are actively seeking opportunities to drive near term capacity growth, including extending the life of our <unk> hundred 20. Please.

Marty: As Randy mentioned, we remain focused on rebalancing our network to ensure we are allocating aircraft to support both our operational and financial goals.

Marty St. George: For the first quarter, capacity contracted 2.7%, exceeding our guidance as a continued focus on operational liability drove a strong completion factor of 98.7%, exceeding plan. This reflects the strong execution by the team and the planning we have done to position our operation to respond more effectively to operational disruptions. Looking ahead, we expect second-quarter capacity to be down 2-5% year-over-year, driven primarily by the continued headwinds we face related to the GTF engine issue.

Marty: We are making margin accretive network changes changes.

Marty: At our core customers and geographies redeploying capacity from underperforming markets and doubling down on proven leisure and VFR markets.

Marty: As part of this work we have closed a handful of blue cities.

And we're also scaling back our flying in Los Angeles, and a number of underperforming and through West Coast International markets.

Marty: As we prioritize our focus in L. A on a transcon routes.

Marty: We also continued the planned margin accretive unwinding of our Laguardia flying.

Marty: Starting this month, we will operate under 30 daily flights Johnson 50 at this time last year with another planned reduction anticipated at the end of October.

Marty: This reduction is driven over a 15 point improvement to margin that laguardia.

Marty St. George: Ursula will provide more detail on that front, and as you will hear, we are actively seeking opportunities to drive near-term capacity growth, including extending the life of our A320 fleet. As Joanna mentioned, we remain focused on rebalancing our network to ensure we are allocating aircraft to support both our operational and financial goals. We are making ModGen and Creative Network changes. Changes, targeted at our core customers and geographies, redeploying capacity from underperforming markets and doubling down on proven leisure and VFR markets. As part of this work, we have closed a handful of blue cities.

Marty: And it's benefited the trailing 12 months margin performance of New York City versus where it was at this time last year, albeit.

Marty: Albeit slowly we continue to see signs that New York is recovering and we are encouraged by the improvement of various economic indicators such as the forecasted return of tourism to 2019 levels beginning next year.

Marty: Moving on to revenues first quarter revenues declined five 1% year over year at the better end of artwork drew.

Marty: Driven by improving close them and strong peak period revenue and aided by the shift of Easter holiday outbound travel into late March.

Marty: This shift contributed an estimated one five points of unit revenue growth through the first quarter.

Marty: Within the cabin, our premium offerings are performing exceptionally well, particularly our even more space ceiling, which produced double digit more revenue year over year on a low single digit decline in capacity.

Marty St. George: And we're also scaling back our flying in Los Angeles, ending a number of underperforming inter-West Coast international markets as we prioritize our focus in L.A. on a transcontinental route. We also continue the planned, modular, creative unwinding of our LaGuardia flight. Starting this month, we will operate under 30 daily flights, down from 50 at this time last year, with another planned reduction anticipated at the end of October.

Marty: Our award winning <unk>, Kevin also continues to perform well with revenue growth up year over year in both our transcon and Trans Atlantic franchises.

Marty: And our network, we saw improved results in our domestic markets with unit revenues and reflecting positive for the quarter.

Marty: This was supported by double digit year over year growth in contracted corporate travel revenue.

Marty: We've also seen significant improvements in trans Atlantic performance with unit revenues upgrades and 25% year over year.

Marty: However, as Joanna mentioned, we continue to be challenged by elevated capacity.

Marty: Region, which makes up roughly 35% total capacity.

Marty St. George: This reduction has driven over a 15-point improvement in margin at LaGuardia, and it's benefited the trailing 12-month margin performance of New York City versus what it was at this time last year. I'll be taking it slow, but we continue to see signs that New York is recovering, and we are encouraged by the improvement of various economic indicators, such as the forecasted return of tourism to 2019 levels beginning next year. Moving on to revenues, first quarter revenues declined 5.1% year-over-year at the better end of our forecast, driven by improving close-in and strong peak-period revenue and aided by the shift of the Easter holiday outbound travel

Marty: And where we are nearly double the size of our next largest competitor.

Marty: Industry capacity in our Latin leisure markets has increased over 60% since 2019.

Marty: And it is growing double digits each quarter since the start of the second half of 2023 Sigma.

Marty: Significantly pressuring our yields in fairs.

Marty: To put this pressure into context if.

Marty: If you exclude our Latin flying a system level unit revenue growth will be positive for the first quarter actual revpar growth, which was down two 5%.

Marty: In order to offset this weakness the other two thirds of our network would have to perform fab year on planned levels.

Marty: Despite these headwinds we remain confident in our Latin leisure and VFR strongholds. These are core jetblue geographies and they remain a top part of our refocused strategy and a meaningful component of our profit engine.

Marty St. George: This shift contributed an estimated 1.5 points of unit revenue growth to the first quarter. Within the cabin, our premium offerings are performing exceptionally well, particularly our even more space seating, which produced double-digit more revenue year-over-year on a low single-digit decline in capacity. Our award-winning Mint Cabin also continues to perform well, with unit revenue growth up year-over-year in both our Transcon and Transatlantic franchise. On our network, we saw improving results in our domestic markets, with unit revenues inflecting positive for the quarter.

Marty: We are committed to aggressively addressing challenges and winning in these core markets.

Marty: The key tenants of our refresh strategy will help us get there.

Marty: Our reinvigorated focus on reliability to a handful to program improved merchandising efforts and evolve product I am confident we are putting the right focus in place to win these Max.

Marty: Turning to our revenue outlook for the second quarter, we expect revenue to decline 605 to 10, 5% year over year.

Marty: We continue to cycle against a difficult revenue comparison, given the unprecedented demand we experienced throughout the first half of 2023 and as mentioned elevated new supply.

Marty: And region.

Marty: Second quarter is further challenged by the Easter holiday shift.

Marty: When adjusting for the shift the midpoint of our implied year over year RASM growth in <unk> is in line to slightly improve versus Q1.

Marty St. George: This was supported by double-digit year-over-year growth and contracted corporate travel revenue. We've also seen significant improvements in transatlantic performance, with unit revenues up greater than 25% year-over-year. However, as Joanna mentioned, we continue to be challenged by elevated capacity in our Latin region, which makes up roughly 35% of our total capacity and where we are nearly double the size of our next largest competitor. Industry capacity in our Latin leisure markets has increased over 60% since 2019, and it's grown double digits each quarter since the start of the second half of 2023.

Marty: Given these factors we expect unit revenue, we remain largely stable throughout the first half as opposed to accelerating at the pace. We had originally anticipated in Q2.

Marty: That said, we do expect stronger year over year RASM acceleration in the second half of the year.

Marty: As our revenue initiatives ramp emulator and additional initiatives.

Marty: In the first quarter, we delivered $40 million in benefits, including preferred seat revenue, which is already exceeding our expectations.

Marty: And we expect the cumulative $300 million to ramp in the second half.

Marty: We're also encouraged by the growth in the diversified revenue stream from our royalty program and Jetblue travel products.

Our loyalty program continues to drive margin accretive revenue as we roll out additional ways for customers to earn points and be rewarded for their loyalty through our enhanced <unk> program.

Marty St. George: Significantly pressuring our yields and fares. To put this pressure into context, if you exclude our Latin flying, our system-level unit revenue growth would have been positive for the first quarter versus actual unit revenue growth, which was down 2.5%. In order to offset this weakness, the other two-thirds of our network would have to perform at five-year unplanned levels.

Marty: Which now enables our customers to choose the perks that are most valuable to them.

Marty: We're also expanding opportunities for our customers to redeem points and we expect to add a number of global redemption partners in the current months.

Marty: In the first quarter <unk> members accounted for a record percentage of overall revenue, reflecting the increased engagement, we're seeing from our enhanced program overall.

Marty St. George: Despite these headwinds, we remain confident in our Latin Leisure and VFR strongholds. These are core JetBlue geographies, and they remain a key part of our refocus strategy and a meaningful component of our profit engine. We are committed to aggressively addressing challenges and winning in these core matches. The key tenets of our refresh strategy will help us get there, from our reinvigorated Focus on Reliability to our Enhanced Loyalty Program, Improved Merchandising Efforts, and Evolved Products. I am confident we are putting the right focus in place to win these matches.

Marty: Overall spending on our co brand card is up 10% year over year.

Marty: And new cardholder growth remained steady, particularly with ametek's, the vast majority of whom that carry jetblue path.

As we refocus our core franchises.

Marty: We're encouraged by continued outsized growth of active members and our proven geographies, especially the northeast region in Florida and.

Marty: And this loyal customer base will be key to our success as we rebalance the network.

Marty: Similarly, jetblue travel products out of 2020 for continuing the momentum from a record set in 2023.

Marty: Commission revenues from Jetblue vacations, and Paisley grew by 21% in the first quarter.

Marty St. George: Turning to our revenue outlook for the second quarter, we expect revenue to decline 6.5% to 10.5% year-over-year. We continue to cycle against a difficult revenue comparison given the unprecedented debt demand we experienced throughout the first half of 2023. And, as mentioned, elevated industry supply in the Latin region. Second quarter is further challenged by the Easter holiday. When adjusting for the shift, the midpoint of our implied year-over-year RASM growth and 2Q is in line to slightly improve versus Q1.

Marty: And we see promising trends around forward summer bookings relative to last year I'm.

Marty: Im, particularly encouraged by the fact that not only the awareness of these product offerings, increasing but that repeat customers.

Marty: Excuse me, our fastest growing segment for both products.

Marty: Before I turn it over to Ursula.

Marty: I returned to Jetblue, because I love This brand our crew members and our customers are.

Marty: Our culture is a true differentiator when the powers our brand drives a safe operation and distinguishes us from our competition.

Ursula L. Hurley: Crew members are at the core enabling us to deliver the jetblue experience our customers expect.

Ursula L. Hurley: And positioning us for operational and financial success.

Ursula L. Hurley: I'm excited to be back here at this pivotal moment, because ICD amaze potential this company.

Marty St. George: Given these factors, we expect unit revenue to remain largely stable throughout the first half, as opposed to accelerating at the pace we had originally anticipated in Q2. That said, we do expect stronger year-over-year RASM acceleration in the second half of the year, as our revenue initiatives ramp up, and we layer in additional initiatives. In the first quarter, we delivered $40 million in benefits, including preferred seating revenue, which is already exceeding our expectations, and we expect the cumulative $300 million to ramp up in the second half.

Ursula L. Hurley: Also see the collective commitment to evolving the strategy in order to restore our historical earnings power.

Ursula L. Hurley: This team is leaving no stone unturned as we pursue the path back to profitability and I am confident we are building the right plan to effectively compete and generate value for the stakeholders again with that over to you Russell.

Russell: Thank you Marty.

Russell: As Joanna and Marty has noted the Swift actions, we took in the first quarter allowed us to exceed our Q1 financial commitments one early indicator of our ability to advance towards our goal of generating positive returns again.

Marty St. George: We're also encouraged by the growth and the diversified revenue streams from our loyalty program and JetBlue travel products. Our loyalty program continues to drive margin-increased revenue as we roll out additional ways for customers to earn points and be rewarded for their loyalty through our Enhanced True Blue program, which now enables our customers to choose the perks that are most valuable to them. We are also expanding opportunities for our customers to redeem points, and we expect to add a number of global redemption patents in the current...

Russell: And though we were profitable in the first quarter, our operating margin exceeded our expectations.

Russell: <unk> by our improving operational reliability solid peak period demand and continued execution on controllable costs.

Russell: Starting on slide seven we.

Russell: We delivered better than expected CASM X fuel in the first quarter with unit costs, increasing by seven 1%, beating the better end of our revised March outlook.

Marty St. George: In the first quarter, the True Blue members accounted for a record percentage of overall revenue, reflecting the increased engagement we are seeing from our enhanced program. Overall, spending on our Cobra and Cod is up 10% yearly here, and UConn holds a growth-maintained study, particularly LaMosaics, the vast majority of whom now carry JetBlue cards, as we refocus our core franchise. We're encouraged by continued outsized growth of active members in our proven geography, especially the greater Northeast region and Florida, and the FLOIL customer base will be key to our success as we rebalance the network.

Russell: This was partially driven by improved operational performance as our continued focus on driving reliability allowed us to complete more flights than planned resulting in cost efficiencies. Additionally.

Russell: Additionally, we saw a shift in the timing of certain expenses, primarily maintenance related to later in the year.

Russell: Also benefiting our cost performance as our structural cost program and fleet modernization program in the first three months of the year, our structural cost program delivered $30 million in incremental savings.

Russell: Driven by more efficient management of disruption costs and optimizing mid to end of life maintenance spend.

Marty St. George: Similarly, JetBlue travel products started 2024, continuing the momentum for my record-setting 2023. Commission revenues from JetBlue Vacations and Paisley grew by 21% in the first quarter, and we see promising trends around forward summer bookings relative to last year. I'm particularly encouraged by the fact that not only is the awareness of these products' offerings increasing, but repeat customers are our fastest growing segment for both products. Before I turn it over to Ursula...

Russell: With to date savings of $100 million, we remain on track to deliver run rate savings in the range of $175 million to $200 million by the end of the year and we expect savings to ramp significantly throughout this year driven by productivity improvements.

Russell: Our fleet modernization program is coming to fruition as we continue to replace our <unk> hundred 90 fleet with the margin accretive <unk> hundred 20, which deliver a 20% improvement in ex fuel unit cost economics versus the <unk> hundred 90 days.

Marty St. George: I returned to JetBlue because I love this brand, our crew members, and our customers. Our culture is a true differentiator, one that powers our brand, drives a safe operation, and distinguishes us from the competition. Our crew members are at the core, enabling us to deliver the JetBlue experience our customers expect and positioning us for operational and financial success. I'm excited to be back here at this pivotal moment because I see the amazing potential of this company and I also see the collective commitment to evolve the strategy in order to restore our historical earnings power.

Russell: By the end of the month, we will have reached a milestone on our fleet transition with more <unk> hundred <unk> and active service than even nineties.

Russell: We will continue to replace our <unk> with <unk> hundred 20 is on a one for one basis by the end of 2025.

Russell: When the even 90 fleet is set to officially retire.

Russell: In addition to better economics, we've already realized $70 million today in maintenance savings and we now expect to realize $100 million in maintenance cost savings through the end of this year up from the original 75 million goal, we previously forecasted.

Marty St. George: This team is leaving no stone unturned as we pursue the path back to profitability. I'm confident we are building the right plan to effectively compete and generate value for the stakeholders again. With that, over to you, Ursula.

Ursula L. Hurley: As Joanna and Marty have noted, the swift actions we took in the first quarter allowed us to exceed our Q1 financial commitments, one early indicator of our ability to advance towards our goal of generating positive returns again. And though we weren't profitable in the first quarter, our operating margin exceeded our expectations, supported by our improving operational reliability, solid peak period demand, and continued execution on controllable costs, starting on slide seven.

Russell: Once we are through this transition period, we expect or a meaningful tailwind to our cost as we returned to operating just two fleet types.

Russell: With regard to our aircraft availability in the second quarter and full year. We expect an average of 11 aircraft to be out of service due to the GTS issues throughout the year.

Russell: We expect will peak in the low teens in the late second early third quarter.

Russell: As we run long range capacity plans to support our multiyear refocused Standalone plan, we continue to face uncertainty around the expected number of aircraft on the ground for 2025 and 2026.

Ursula L. Hurley: We delivered better than expected CHASM-X fuel in the first quarter, with unit costs increasing by 7.1%, beating the better end of our revised March outlook. This was partially driven by improved operational performance, as our continued focus on driving reliability allowed us to complete more flights than planned, resulting in cost efficiencies. Additionally, we saw a shift in the timing of certain expenses, primarily maintenance related to later in the year. Also benefiting our cost performance are our Structural Cost Program and Fleet Modernization Program.

Russell: While we expect this number will increase about 2024 levels. This situation remains frustratingly fluid.

Russell: We also continue to work towards reaching an agreement with Pratt <unk> Whitney on 2020 for compensation.

Russell: As far as the initial GTS compensation that we had included in our 2024 plan. We had originally been advised that the accounting treatment for this compensation could be recorded as an offset to operating expenses.

Ursula L. Hurley: In the first three months of the year, our Structural Cost Program delivered $30 million in incremental savings, driven by more efficient management of disruption costs and optimizing mid to end of life maintenance spend. With savings to date of $100 million, we remain on track to deliver run rate savings in the range of $175 to $200 million by the end of the year. And we expect savings to ramp significantly throughout this year driven by productivity improvement.

Russell: However, following analysis of precedent industry transaction of similar nature, we will now record compensation as a reduction to aircraft assets or as amortization of maintenance expense.

Russell: This is expected to have an adverse impact on CASM ex fuel as this benefit will now be recognized over a longer period of time.

Ursula L. Hurley: Our fleet modernization program is coming to fruition as we continue to replace our E-190 fleet with the margin-accretive A-220s, which deliver a 20% improvement in ex-fuel unit cost economics versus the E-190s. By the end of the month, we'll have reached a milestone on our fleet transition with more A220s in active service than E190s, and we will continue to replace our E-190s with A-220s on a one-for-one basis by the end of 2025, when the E-190 fleet is set to officially retire.

Russell: Despite the significantly reduced compensation recognized in 2024 earnings full year CASM ex fuel growth is expected to be within the range of our initial January guidance, partially driven by incremental cost offsets we have already internally identified.

Russell: For the second quarter, we expect CASM ex fuel to increase between five and a half and 75% year over year coming down from the first quarter levels as we lap a full year of costs related to our 2023 pilot agreement and as we execute on our controllable costs and fixed.

Ursula L. Hurley: In addition to better economics, we've already realized $70 million to date in maintenance savings, and we now expect to realize $100 million in maintenance cost savings through the end of this year, up from the original $75 million goal we previously forecasted. Once we are through this transition period, we expect a more meaningful tailwind to our costs as we return to operating just two fleet types. With regard to our aircraft availability in the second quarter and full year, we expect an average of 11 aircraft to be out of service due to the GTF issues throughout the year. We expect we'll peak in the low teens in the late second to early third quarter.

Russell: Cost reductions for.

Russell: For the full year, we continue to expect CASM ex fuel growth of mid to high single digits year over year.

Russell: To better align our cost base with our operating levels. During this challenged growth period, we've scaled back fixed cost spending where we can.

Russell: In January we offered a voluntary opt out program to targeted work groups across our operation and support centers and the cost savings are on track with our expectation.

Russell: In addition, we are right sizing our real estate footprint in several airports with above average airport costs, such as Laguardia and lax.

Ursula L. Hurley: As we run long-range capacity plans to support our multi-year refocused standalone plan, we continue to face uncertainty around the expected number of aircraft on the ground for 2025 and 2026. While we expect this number will increase above 2024 levels, the situation remains frustratingly fluid. We also continue to work towards reaching an agreement with Pratt & Whitney on 2024 compensation. As far as the initial GTF compensation that we had included in our 2024 plan, we had originally been advised that the accounting treatment for this compensation could be recorded as an offset to operating expenses.

Russell: Bind these fixed cost savings are expected to drive a half a point of unit cost savings for the full year, which is reflected in our full year guidance.

Russell: Additionally, as Joanna mentioned, we are utilizing technology to further enhance our efficiency and productivity and we expect it will be a main driver of incremental cost savings.

Finally, though we no longer plan to approach breakeven profitability. This year I'm confident we have a strong plan in place to overcome the headwinds we face and the continued control of our cost structure will provide the baseline support we need to become profitable again.

Ursula L. Hurley: However, following analysis of precedent industry transactions of a similar nature, we will now record compensation as a reduction in aircraft assets or as amortization of maintenance expense. This is expected to have an adverse impact on CASM-X fuel, as this benefit will now be recognized over a longer period of time.

Russell: Turning to liquidity and our balance sheet on slide eight.

Russell: As we continue to work through near term growth challenges stemming from the GTS issues, we are exploring cost effective and capital light way to grow our fleet today.

Russell: To date, we have committed to purchase or purchased 12 <unk> hundred 20 aircraft off lease that was set for returned to lessors.

Ursula L. Hurley: Despite the significantly reduced compensation recognized in 2024 earnings, full year CASMX fuel growth is expected to be within the range of our initial January guidance, partially driven by incremental cost offsets we have already internally identified. For the second quarter, we expect CASMX fuel to increase between five and a half and seven and a half percent year over year, coming down from the first quarter levels as we lap a full year of costs related to our 2023 pilot agreement and as we execute on our controllable costs and fixed cost reductions.

Looking ahead, we have further optionality and could elect to extend the life of approximately 30 <unk> hundred 20 aircraft in total which represents approximately 10% of our total fleet today.

Russell: We also continue to receive new aircraft from our order book with Airbus and in the first quarter, we took delivery of eight aircraft through the remainder of the year, we expect to take delivery of 19 aircraft for a total of 27 deliveries in 2020 for 20 of which are <unk> hundred <unk>.

Ursula L. Hurley: For the full year, we continue to expect CASM-X fuel growth of mid to high single digits year over year. To better align our cost base with our operating levels during this challenged growth period, we've scaled back fixed cost spending where we can. In January, we offered a voluntary opt-out program to targeted work groups across our operation and support centers, and the cost savings are on track with our expectations.

Russell: 'twenty.

Russell: Prioritizing <unk> 'twenty deliveries in the near term helps to better match the needs of our customers with our cost goals, while continuing to evolve our product offering as the <unk> hundred 20 offers 90% more premium seating that are E 190 aircraft.

Russell: In addition, all of our 2024 and 2025 <unk> hundred 21, Neo deliveries will be configured with our award winning mint product further increasing our mix of premium S. M.

Ursula L. Hurley: In addition, we are right-sizing our real estate footprint in several airports with above-average airport costs, such as LaGuardia and LAX. Combined, these six cost savings are expected to drive a half a point of unit cost savings for the full year, which is reflected in our full year guidance. Additionally, as Joanna mentioned, we are utilizing technology to further enhance our efficiency and productivity, and we expect it will be a main driver of incremental cost savings.

Russell: Ultimately our fleet is a key enabler to delivering a more premium experience, which is a core piece of our strategic evolution to better serve the full spectrum of leisure customers.

Russell: We ended the quarter with $1 7 billion in liquidity, excluding our undrawn $600 million revolving credit facility.

Ursula L. Hurley: Finally, though we no longer plan to approach break-even profitability this year, I'm confident we have a strong plan in place to overcome the headwinds we face, and the continued control of our cost structure will provide the baseline support we need to become profitable again. Turning to liquidity and our balance sheet on slide eight.

Russell: As we reached the peak of our fleet modernization efforts, we have been actively financing our aircraft deliveries and we have secured nearly $1 6 billion of committed financing year to date.

Russell: Finally, we continue to Opportunistically look at hedging as a means to manage risk, particularly in a market that continues increased volatility as a result of geopolitical concerns and the middle East.

Ursula L. Hurley: As we continue to work through near-term growth challenges stemming from the GTF issues, we are exploring cost-effective and capital-light ways to grow our fleet. To date, we have committed to purchase, or purchased, 12 A320 aircraft off-lease that were set for return to lessors. Looking ahead, we have further optionality and could elect to extend the life of approximately 30 A320 aircraft in total, which represents approximately 10% of our total fleet today.

Russell: As of today, we have hedged approximately 27% of our expected fuel consumption for the second quarter and approximately 16% for the full year.

Speaker Change: In closing I want to thank our amazing crew members for all their hard work and dedication day in and day out we are 100% focused on executing on our strategic initiatives to meet the challenges of our industry.

Ursula L. Hurley: We also continue to receive new aircraft from our order book with Airbus, and in the first quarter, we took delivery of eight aircraft. Through the remainder of the year, we expect to take delivery of 19 more aircraft for a total of 27 deliveries in 2024, 20 of which are A220s. Prioritizing A220 deliveries in the near term helps to better match the needs of our customers with our cost goals while continuing to evolve our product offering, as the A220 offers 90% more premium seating than our E190 aircraft.

Speaker Change: We have already taken action across the board as evidenced by the deferral of $2 $5 billion of planned Capex significant network changes.

Speaker Change: Launch of our revenue initiatives and our continued laser focus on costs all with our eyes trained on our ultimate goal of profitability.

I am confident we are building a strong plan to fully leverage our unique position in the market and as you can see from our results. We are already executing on this plan and moving with urgency to set the airline on a path back to delivering long term value for our owners and all of our.

Ursula L. Hurley: In addition, all of our 2024 and 2025 A321neo deliveries will be configured with our award-winning Mint product, further increasing our mix of premium ASMs. Ultimately, our fleet is a key enabler to delivering a more premium experience, which is a core piece of our strategic evolution to better serve the full spectrum of leisure customers. We ended the quarter with $1.7 billion in liquidity, excluding our undrawn $600 million revolving credit facility.

Speaker Change: Stakeholders.

Speaker Change: With that we will now take your questions.

Speaker Change: Thanks, everyone. We're now ready for the question and answer session. James. Please go ahead with the instructions.

James: Thank you at this time I'd like to ask a question. Please press star and one on your telephone keypad, you may remove yourself from the queue at any time by pressing star two.

James: Again that is star and wanted to ask a question.

James: And we'll take our first question today from Dan Mckenzie with Seaport Global.

Ursula L. Hurley: As we reach the peak of our fleet modernization efforts, we have been actively financing our aircraft deliveries, and we have secured nearly $1.6 billion of committed financing year-to-date. Finally, we continue to opportunistically look at hedging as a means to manage risk, particularly in a market that continues to increase volatility as a result of geopolitical concerns in the Middle East. As of today, we have hedged approximately 27% of our expected fuel consumption for the second quarter and approximately 16% for the full year.

Daniel J. McKenzie: Oh, Hey, thanks, good morning, guys.

Daniel J. McKenzie: I guess Joanna following up on the steps that you outlined to restore earnings and feel free to Tampa sized those steps again, but what normalized margins are you targeting at this point and what does that trajectory look like and I guess, what I'm getting at is.

Daniel J. McKenzie: Should investors view the changes is a gradual ramp up to normalized earnings C. Two years from now maybe three or wherever the steps you've outlined or is there some low hanging fruit that could really move the dial near term.

Ursula L. Hurley: In closing, I want to thank our amazing crew members for all their hard work and dedication day in and day out. We are 100% focused on executing on our strategic initiatives to meet the challenges of our industry. We have already taken action across the board, as evidenced by the deferral of $2.5 billion of planned CapEx, significant network changes, the launch of our revenue initiatives, and our continued laser focus on costs, all with our eyes trained on our ultimate goal of profitability.

Joanna L. Geraghty: Hi, Dan Thanks for the question I'm not going to put a timeline around when we start to see meaningful margin accretion I think our focus right now is about returning to profitability.

Speaker Change: And that is where all all of our priorities are focused.

Speaker Change: We've talked about our unique position in the industry.

Speaker Change: Obviously coming out of Covid leisure is a strong point for Jetblue, we've got great geography, some of which obviously are the impaired at this point in time, but we do think they will become a tailwind we've got a good product we know theres gaps we're working to fill those are brand our cost structure. Our focus right now is executing what we can control and I think youre seeing that in <unk>.

Ursula L. Hurley: I am confident we are building a strong plan to fully leverage our unique position in the market. And, as you can see from our results, we are already executing on this plan and moving with urgency to set the airline on a path back to delivering long-term value for our owners and all of our stakeholders. With that, we will now take your questions.

Speaker Change: Any of the steps that we have undertaken in the last several weeks, including the network redeployment.

Speaker Change: Some of the changes to ancillary fees and revenue doing some nice work around driving that $300 million of our revenue initiatives, our reliability initiatives and early wins there stronger completion factor in Q1, and improved <unk> <unk> compared to Q1 of 'twenty, three obviously loyalty and <unk> are doing well and then our cost initiative.

Operator: Thanks, everyone. We're now ready for the question and answer session. James, please go ahead with the instructions. Thank you.

Operator: Thank you. At this time, if you would like to ask a question, please press star and 1 on your telephone keypad. You may remove yourself from the queue at any time by pressing star 2. Once again, that is star and 1 to ask a question. And we'll take our first question today from Dan McKenzie with Seaport Global.

Speaker Change: Thank the Pratt situation is a challenge we'd like more certainty there.

Speaker Change: We're working toward having that but the team is focused on executing and really focus on returning to profitability. The challenge in the Latin region that will cycle through and we'd hoped that we would see acceleration into Q2, we're not seeing that but again, we view that as transitory in nature in terms of what could provide re.

Daniel J. McKenzie: Oh, hey, thanks. Good morning, guys.

Joanna L. Geraghty: I guess, Joanna, following up on the steps that you outlined to restore earnings, and, you know, feel free to emphasize those steps again, but what normalized margins are you targeting at this point? And what does that trajectory look like? And I guess what I'm getting at is, you know, should investors view the changes as a gradual ramp-up to normalized earnings, say, you know, two years from now, maybe three? Or are the steps you've outlined, there some low-hanging fruit? That could really move the dial in the near term?

Speaker Change: Acceleration honestly the network changes as we look at those in the $300 million of revenue initiatives. Many of those network changes haven't actually layered in yet so they are announced but youre not seeing the benefit of those so again focused on making sure that we're executing quickly.

Speaker Change: And with haste to return to profitability.

Speaker Change: Very good I guess on that point.

Joanna L. Geraghty: Hi Dan, thanks for the question. You know, I'm not going to put a timeline around when we start to see meaningful margin accretion. I think our focus right now is returning to profitability. And that is where, you know, all of our priorities are focused. You know, we've talked about our unique position in the industry. Obviously, coming out of COVID, leisure is a strong point for JetBlue. We've got great geography, some of which, obviously, are a bit impaired at this point in time, but we do think they will become a tailwind in the future.

Speaker Change: I guess the second question is for Marty on the network announcement is there an adjustment period as the new client ramps up or.

Marty: Or is it typically a move up in RASM as you lop off the unprofitable flying in and my thought is maybe it's the latter just given your expectation for RASM acceleration in the back half of the year, but if you could just clarify a little bit more on sort of where you.

Marty: If theres more to do.

Joanna L. Geraghty: And so, you know, we've mentioned we've got a good product. But we know there are gaps. We're working to fill those. Our brand, our cost structure, and our focus right now is executing what we can control. And I think you're seeing that in many of the steps that we have undertaken in the last several weeks, including the network redeployment, some of the changes to ancillary fees and revenue, doing some nice work around driving that $300 million revenue initiative, our reliability initiatives and early wins there, a stronger completion factor in Q1 and improved performance in Q14 compared to Q1 of 23. Obviously, loyalty and JTP are doing well. And then our cost initiative. You know, I'll be upfront; the Pratt situation is a challenge.

Marty: And how that would impact how youre thinking about revenues back half of this year into 2025, thanks for taking the hi, Dan Thanks for the question.

Speaker Change: But first I'll say that our expectations as far as the accretion due to the network changes are part of the $300 million. We've already communicated is our expectation for 2024, so that's actually built in there.

Speaker Change: To make a point that reiterate a point that you intimated.

Speaker Change: The first city closure actually isn't until next week. So we havent really seen a lot of the benefits going forward I would say as far as redeploying of aircrafts.

Speaker Change: We're coming into the third quarter I think we have identified some very.

Speaker Change: [noise] desirable places to redeploy and that again its all reflect the numbers that we saw I have to say that some of the some of the network changes were directly related to aircraft shortfalls to our situation with prep so.

Joanna L. Geraghty: We'd like more certainty there, and we're working toward having that. But the team is focused on executing and really focused on returning to profitability. The challenge in the Latin region, you know, that will cycle through. We hoped that we would see acceleration into Q2, but we're not seeing that. But again, we view that as transitory in nature. In terms of what could provide real acceleration, honestly, the network changes, as we look at those and the $300 million in revenue initiatives, many of those network changes haven't actually been layered in yet. So they're announced, but you're not seeing the benefit of those. So again, focused on making sure that we're executing quickly and with haste to return to profitability.

Speaker Change: One of the reasons why we thought the best way to communicate this would be just to explain the $3 million number and again thats. The number will be getting by the end of the year. So that's sort of how we should view the accretion of the network changes and I'll also say that.

Speaker Change: There are more network changes to come back to the point that joined you made about.

Speaker Change: Postponing the Investor day.

Speaker Change: These are all tied together as far as making sure that we have rolled out all the changes that we want to do with respect to the opportunities.

Speaker Change: It would be the case the next tranches in the $300 million, but.

Speaker Change: I think it's fair to say, we are not done as far as continue to fine tune the network.

Speaker Change: Thanks, so much guys.

Speaker Change: Yeah.

Speaker Change: Our next question comes from Jamie Baker with Jpmorgan.

Marty St. George: Yeah, very good. I guess on that point, I guess the second question is for Marty on the network. Is there an adjustment period as the new flying ramps up? Or, you know, as you, or is it typically a move up in RASM as you lap up the unprofitable flying? My thought is maybe it's the latter, just given your expectation for RASM acceleration in the back half of the year. But if you could just clarify a little bit more on sort of where you are, you know, if there's more to do and, you know, how that would impact how you're thinking about revenue back half of this year into the quarter, I think we have identified some very desirable places to redeploy.

Jamie Nathaniel Baker: Oh yeah.

Jamie Nathaniel Baker: Good morning, everybody, so probably for Marty.

No airlines don't like to offer.

Jamie Nathaniel Baker: Route.

Jamie Nathaniel Baker: P&L commentary, but I figured I'd try to ask the question in a way you might answer so without speaking to individual stations can you give us some margin commentary on the <unk>.

Jamie Nathaniel Baker: Aggregate.

Jamie Nathaniel Baker: Baltimore, Kansas City, the short haul.

Jamie Nathaniel Baker: And Latin markets.

Speaker Change: You are exiting them.

Perhaps margin basis, or maybe just sheer dollars of law suits, just trying to any color as to what that reduction in loss production sums to.

Marty St. George: And that again, it's all reflected in the numbers that we saw. I have to say that some of the network changes were directly related to aircraft shortfalls due to our situation with Pratt. So it's one of the reasons why we thought the best way to communicate this would be just to explain the $300 million number. And again, that's a number we'll be getting by the end of the year.

Speaker Change: Well.

Speaker Change: Listen I appreciate your efforts and trying to get me to give you that number I mean, we generally really don't talk about that level of detail.

Marty St. George: So that's sort of how we should view the accumulation of network changes. And I will also say that, you know, there are more network changes to come. And back to the point that Joanna made about, you know, the postponement of yesterday. I think these things are all tied together as far as making sure that we have rolled out all the changes that we want to do with respect to the opportunities. If that be the case, the next tranche is in the $300 million. But I think it's fair to say we are not done as far as continuing to fine-tune the network.

Speaker Change: I will just say that the aggregate of those changes and the redeployment of airplanes is all based in the $300 million. So that's really sort of how we look at that and how we communicate it.

Speaker Change: <unk>.

Speaker Change: Feel like.

Speaker Change: Given more time and.

Different competitive situations, you will feed made them in different as far as some of the stuff that.

Speaker Change: That we chose to exit but between the stuff you mentioned between the la short haul.

Speaker Change: And the imperative back to Jordan's point, the imperative of improving profitability now.

Operator: Our next question will come from Jamie Baker with J.P. Morgan.

Jamie Nathaniel Baker: Oh, yeah. Good morning, everybody.

Speaker Change: It was really it was time for us to make moves and we're very excited about the changes it's always unfortunate given the situation of our crew members but.

Marty St. George: So probably for Marty, I know airlines don't like to offer, you know, route P&L commentary. But I figured I'd try to ask the question in a way you might answer. So without speaking to individual stations, can you give us some margin commentary on the aggregate of Baltimore, Kansas City, the short haul LA, and Latin markets that you know you are exiting, perhaps on a margin basis or or maybe just sheer dollars of loss, just trying to give us any color as to what that reduction in loss production sums to?

Speaker Change: We have to prioritize returns right now.

Speaker Change: Okay.

Speaker Change: And then second probably for his long liquidity.

Speaker Change: What's the minimum cash balance that you internally target to run the airline and all so if we set aside branded loyalty.

Marty St. George: Well, listen, I appreciate your efforts and trying to get me to give you that number. I mean, we generally really don't talk about that level of detail. I will just say that the aggregate of those changes and the redeployment of airplanes is all based on the 300 million. So that's really sort of how we look at that and how we communicate it. Okay.

Speaker Change: What's the size of the remaining unencumbered asset pool in your estimate.

Speaker Change: Thanks for the question Jami and I think you are celebrating a birthday. This week aren't you.

Speaker Change: Okay.

Robyn as legacy lives on.

Speaker Change: Yes.

Speaker Change: Of course [laughter].

Speaker Change: Sure.

David: David actually.

David: Yeah.

Marty St. George: Um, you know, given more time and, um, you know, different competitive situations, things may have been different as far as some of the stuff that we chose to exit. But, you know, between the stuff you mentioned between the LA short haul and the imperative, back to Joanna's point, the imperative of improving profitability now, it was really time for us to make moves. And we're very excited about the changes. It's always unfortunate, given the situation with our crew members, but, you know, we have to prioritize returns right now.

David: So we are targeting somewhere between one five and one point.

David: $6 billion.

David: Of cash at any point in time as a reminder, we also have the $600 million revolving credit facility on top of that.

David: And to your question on the unencumbered asset base. So we've publicly commented that we have about $10 billion and just over half of that is associated with the loyalty and the brands. So the remaining of that unencumbered asset pool of the combination of slots gates and routes.

David: Aircraft and engines.

Ursula L. Hurley: Yeah, okay. And then second, for Ursula on liquidity, what's the minimum cash balance that you internally target to run the airline? And also, if we set aside brand and loyalty, what's the size of the remaining unencumbered asset pool in your estimate?

Speaker Change: Okay perfect. Thank you very much.

Speaker Change: Okay.

Our next question will come from Mike Lindenberg with Deutsche Bank.

Michael John Linenberg: Good morning, everyone.

Michael John Linenberg: The downward revision in top line for the year is that entirely Latin America or is there you know.

Ursula L. Hurley: Thanks for the question, Jamie, and I think you're celebrating a birthday this week.

Michael John Linenberg: A shift in maybe GTS, groundings and or delayed Airbus narrow bodies I mean are there other components that.

Ursula L. Hurley: We are targeting somewhere between $1.5 and $1.6 billion of cash at any point in time. As a reminder, we also have the $600 million Revolving Credit Facility on top of that. And to your question on the unencumbered asset base, so we've publicly commented that we have about $10 billion, and just over half of that is associated with loyalty and the brand. So the remaining of that unencumbered asset pool is a combination of slots, gates, and Okay, perfect. Thank you very much.

Michael John Linenberg: Hi, Mike This is Dave Clarke I'm happy to take that yes. It is primarily sort of.

David C. Clark: Unit revenue related.

David C. Clark: And as exemplified with the latent capacity and pressure were seeing thats, causing you to not accelerate as quickly as we expected there is a little bit of capacity. We're trimming the fall trough as we look at the latest demand and supply trends and try to better match supply with demand.

David C. Clark: You don't see that in the capacity guidance because completion factors running ahead, but it's mostly sort of unit revenue and there is a bit of a lower trough capacity in the back half of the year and Mike maybe I will just add we did see capacity growth coming down slightly in Q2. So we had expected acceleration from Q1 into Q2, we're just not seeing that.

Operator: Our next question will come from Mike Linenberg of Deutsche Bank.

Michael John Linenberg: Good morning, everyone. Just a downward revision in top line for the year. Is that entirely Latin America or is there, you know, a shift in maybe GTF groundings and or delayed Airbus narrowbodies? I mean, are there other components to that?

David C. Clark: And so as you think about the size of the Latin market to Jetblue and its importance. We think this is the most the most prudent move as we know capacity comes and goes this region tends to be quite resilient and performs well for us we will continue to double down in this area because it is so core to geos to our geographies, but it is frustrating that we aren't seeing that.

David C. Clark: Hi Mike, this is Dave Clark. I'm happy to take that. Yes, it is primarily sort of unit revenue related. And, you know, as exemplified by the Latin capacity and pressure we're seeing that's causing it to not accelerate as quickly as we expected. There is a little bit of capacity; we're trimming the fall trough, as we look at the latest demand and supply trends and try to better match supply with demand. You don't see that in the capacity guidance because completion factors run ahead, but it's mostly sort of unit revenue, and there's a bit of lower trough capacity in the back half of the year.

David C. Clark: <unk>.

David C. Clark: That that acceleration into Q2 that we thought we would see with capacity growth slightly moderating from Q1 to Q2 okay.

Speaker Change: Okay, Great and just a second question.

Speaker Change: I think I heard you correctly, you said that all of the airplanes.

Joanna L. Geraghty: And, Mike, maybe I'll just add, you know, we did see capacity growth coming down slightly in Q2, so we had expected acceleration from Q1 into Q2. We're just not seeing that.

Speaker Change: Maybe you or at least the <unk> hundred 21, Neo is coming into 'twenty, $4, 25, which I guess are all the airplanes I could be wrong, except for <unk> hundred twenty's.

Speaker Change: Are coming with the mint configuration is that the.

Joanna L. Geraghty: And so, as you think about the size of the Latin market for JetBlue and its importance, you know, we think this is the most prudent move. As we know, capacity comes and goes. This region tends to be quite resilient and performs well for us. We will continue to double down on this area because it is so core to our geographies. But it is frustrating that we aren't seeing that acceleration into Q2 that we thought we would see with capacity growth slightly moderating from Q1 to Q2. Okay, great.

Speaker Change: Large mint configuration, or small mint configuration, and I guess, what I'm getting to is should we anticipate additional trans Atlantic cities over the next year or two above and beyond what you've already announced thanks for taking my question.

Speaker Change: Yeah. Thanks, Mike So as a reminder, we have 27 deliveries. This year in 2024 seven of them are <unk> hundred 21, neo so they will be in the 16 feet.

Speaker Change: Mint configuration, and then in 2025, we have 25 deliveries and five of those are <unk> hundred 21, <unk>, which will be in Mint and then maybe I'll pick up on the Trans Atlantic question.

Ursula L. Hurley: Okay, great. And just a second question. I think I heard you correctly, Ursula, you said that all of the airplanes... Maybe, or at least the A321neo is coming in 24 and 25, which I guess are all the airplanes, I could be wrong, except for, well, the A220s, are coming with the mint configuration. Is that the, you know, large mint configuration or small mint configuration? And I guess also what I'm getting to is, should we anticipate additional transatlantic cities over the next year or two above and beyond what you've already announced? Thanks for taking my question.

Speaker Change: Trans Atlantic has performed very well for us this summer will be strong as we mentioned before however, as we look at growth. There. We are currently serving what we believe are sort of the top underserved markets for Jetblue out of Boston and New York.

Speaker Change: We will look to continue doing this further seasonal <unk> them as appropriate if you look at Edinburgh in Dublin on both seasonal markets doing well for us so far but great contributors right now on the <unk> question. I'll also emphasize premium is doing exceptionally well, 25% of our seats or premium or combination of men in even more space. So.

Ursula L. Hurley: Yeah, thanks, Mike. So as a reminder, we have 27 deliveries this year in 2024. Seven of them are A321neos, so they will be in the 16-seat Mint configuration. And then in 2025, we have 25 deliveries, and five of those are A321neos, which will be in Mint. And then maybe I'll pick up on the Trans Atlantic question.

Speaker Change: Between the <unk> hundred 20, and the <unk> hundred 20 ones that were saving we will see an increase in our premium mix, which is great.

Speaker Change: Very good thank you.

Speaker Change: Okay.

Speaker Change: Our next question will come from Duane <unk> with Evercore ISI.

Joanna L. Geraghty: And then maybe I'll pick up on the transatlantic question. You know, transatlantic has performed very well for us. We know the summer will be strong, as we've mentioned before.

Speaker Change: Yes.

Duane: Okay. Thank you.

Duane: I wonder if we could drill a little bit deeper on on the Latin trends is this primarily U.

Joanna L. Geraghty: However, as we look at growth there, we are currently serving what we believe are sort of the top underserved markets for JetBlue out of Boston and New York. So we'll look to continue doing this further, seasonalizing them as appropriate. If you look at Edinburgh and Dublin, both seasonal markets doing well for us so far but great contributors right now. On the mint question, I'll also emphasize that premium is doing exceptionally well. 25% of our seats are premium, a combination of mint green and even more space. And so between the A220 and the 321s that we're receiving, we will see an increase in our premium mix, which is great. Very good

Duane: U S to Caribbean I think of Jetblue historically is more of a Caribbean network you are too.

Duane: Two largest markets by a very wide margin, our Puerto Rico.

Duane: And the Dominican Republic can you speak to trends in those two markets specifically.

Duane: And then if you would is there any differentiation in trend.

Duane: Between Caribbean originating from the northeast and Caribbean originating from South Florida.

Duane: Thanks, Duane this is Dave I'll take that I think the easiest way to think about it is the breakdown between sort of Caribbean beach destinations in the Caribbean VFR destinations.

Duane Thomas Pfennigwerth: Our next question will come from Duane Pfennigwerth with Evercore ISI.

The VFR is holding up relatively well industry capacity there has been relatively less so that is still under some pressure, but not as much as the beach destinations, where we see increased <unk>.

David C. Clark: Thank you. I wonder if we could drill a little bit deeper on the Latin trends. Is this primarily U.S. to Caribbean? I think of JetBlue historically as more of a Caribbean network. Your two largest markets by a very wide margin are Puerto Rico and the Dominican Republic. Can you speak to trends in those two markets specifically? And then, if you would, is there any differentiation and trend between Caribbeans originating from the Northeast and Caribbeans originating from South Florida?

Duane: <unk> really high increase capacity, which is driving even higher.

Speaker Change: Sure on the yields.

Dave: Puerto Rico, and Dominican Republic, both extremely important market to us we are 100% committed to winning competing.

Dave: Turning our leadership in these markets. So we feel very good about them, we have a deep history of their large operation.

David C. Clark: Thanks, Duane. This is Dave.

Dave: We are working to rollout some enhancements to be performing even better in each so I'm really committed to these markets. They are under a bit of pressure with competitive capacity that ebbs and flows but we feel it's transitory in nature and we will continue to be a very important and profitable region for us.

David C. Clark: I'll take that. I think the easiest way to think about it is the breakdown between sort of Caribbean beach destinations and Caribbean VFR destinations. The VFR is holding up relatively well. Industry capacity there has been relatively low, so that is still under some pressure, but not as much as the beach destinations where we see increased capacity, really high increased capacity, which is driving even higher pressure on yield. You know, Puerto Rico and the Dominican Republic are both extremely important markets to us.

Dave: I guess, those two which one is more VFR and which one is more beach.

The Dominican Republic in general is a bit more VFR, especially a very large operations incentive Domingo and Santiago, which are almost entirely VFR.

Speaker Change: Thanks, and then just for my follow up on reliability I Wonder if you can survey this in any way.

Speaker Change: But as Youre reliability has improved do you think there may be a gap between how customers perceive your reliability.

David C. Clark: We are 100 percent committed to winning, competing, and maintaining our leadership in these markets, so we feel very good about them. We have a deep history there, a large operation, and are working to roll out some enhancements to be performing even better in each. So I'm really committed to these markets. They're under a bit of pressure with competitive capacity that ebbs and flows, but we feel it has a transitory nature and will continue to be a very important and profitable region for us.

Speaker Change: And where it stands.

Speaker Change: The improvement you've made how long of a hangover may exist.

Speaker Change: From past operational perceptions, thanks for taking the questions.

Speaker Change: Yes. Thanks, Thanks, Wayne So we are in the early stages of our operational reliability initiatives. So we're seeing some nice progress, but it is a multi year initiative and we've got some work to do so I definitely think there'll be a lag in customer perceptions. We obviously are also focused on this summer ATC is going to be a challenge. This summer so despite many of the.

David C. Clark: I guess of those two, which one is more VFR and which one is more beach?

David C. Clark: The Dominican Republic, in general, is a bit more VFR. We have very large operations in Santo Domingo and Santiago, which are almost entirely VFR.

David C. Clark: Thanks, and then just for my follow-up on reliability, I wonder if you can survey this in any way? But as your reliability has improved, do you think there may be a gap between how customers perceive your reliability and where it stands, you know, the improvement you've made? How long of a hangover may exist from past operational perceptions?

Speaker Change: The efforts that we're making we're still going to have bad weather days.

Speaker Change: We'll probably be fairly acute in new York, So theres definitely.

Speaker Change: <unk> definitely some work to do on the customer perception piece, but we got to start somewhere and I am pleased with the progress that we've made in Q1 and it will be.

Speaker Change: Some I think incremental progress quarter over quarter until we're in a much better place over the next couple of years.

Joanna L. Geraghty: Thanks for taking the question. Yeah, thanks. Thanks, Wayne. So we are in the early stages.

Speaker Change: Okay. Thank you.

Speaker Change: Our next question will come from Savi <unk> with Raymond James.

Joanna L. Geraghty: Yep, thanks. Thanks, Wayne.

Savi: Hey, Good morning, I was just kind of curious on the unit revenue.

Joanna L. Geraghty: We are in the early stages of our operational reliability initiative. We're seeing, you know, some nice progress, but it's a multi-year initiative, and we've got some work to do. So I definitely think there'll be a lag in customer perceptions. You know, we're obviously also focused on this summer. ATC is going to be a challenge this summer. So despite many of the efforts that we're making, you know, we're still going to have bad weather days, and we'll probably be fairly acute in New York.

Savi: The guidance seems to be calling for going from like down mid single digits to up mid single digits.

Savi: And you kind of called out some of the components that drive that but I was wondering just you know.

Savi: Generally how much of that is driven by maybe easier comps in the second half last year versus this year versus kind of the network changes you've talked about and just maybe the third bucket how much of that might be coming from just industry capacity moderating in Latin.

Joanna L. Geraghty: So there's definitely, definitely some work to be done. There's a lot of work to do on the customer perception piece, but, you know, we got to start somewhere, and I'm pleased with the progress that we made in Q1. It'll be, you know, some, I think, incremental progress quarter over quarter until we're in a much better place over the next couple of years.

Yes. Thanks, Ravi this is Dave I'll take that.

Dave: You hit the big three components right. There, there's a few things that help us as we go from the first half of the second half of in terms of the continued progress of our sequential unit revenue.

Savvy Sith: Our next question will come from Savvy Sith with Raymond James.

Dave: The $300 million of revenue initiatives ramping up is clearly the first one as mentioned we secured $40 million in the first quarter that will continue to ramp over the next three to get us to a total of 300 or 300 million across all of them. So that's clearly a C.

David C. Clark: Hey, good morning. I'm just kind of curious about the unit revenue guidance needs to be calling for, you know, going from like down the single digits to up the single digits. And you kind of called out some of the components that drive that, but I was wondering just, you know, generally, how much of that is driven by maybe easier comps in the second half of last year versus this year, versus kind of the network changes you've talked about, and just maybe the third bucket, you know, how much of that might be coming from just industry capacity, moderating, and that.

Dave: Significant tailwind excuse me.

Dave: There is a comp certainly easing coming up.

Dave: The first half of 2023 had a lot of pent up.

Dave: Covid demand, especially in our sort of spring break, Florida and geographies that we're still cycling against them this quarter, but that eases as we go through the quarter. So I think those are the two biggest ones capacity.

Dave: Right now it looks to moderate we'll sort of see as schedules from up as we go through the year and that could be sort of a third benefit as well.

David C. Clark: Yeah, thanks, Savi. This is Dave.

David C. Clark: I'll take that. You hit the big three components right there. There are a few things that help us as we go from the first half to the second half, in terms of the continued progress of our sequential unit revenue. The $300 million of revenue initiatives ramping up is clearly the first one. As mentioned, we secured $40 million in the first quarter, and that will continue to ramp up over the next three to get us to a total of $300 million across all of them.

Speaker Change: Got it.

Speaker Change: And if I might on and it's not just.

Speaker Change: Just on the financing for this year could you talk about.

What youre seeing and just as all of that kind of comes together in what you're kind of expecting in terms of net interest expense.

Speaker Change: Yeah, I think savi.

David C. Clark: So that's clearly a significant tailwind, excuse me. And then there is a comp, certainly, an easing coming up. The first half of 2023 had a lot of pent-up COVID demand, especially in our sort of spring break Florida and Latin geographies that we're still cycling against in this quarter, but that eases as we go through the quarter. So I think those are the two biggest ones. Capacity, you know, right now it looks to moderate. We'll sort of see if schedules firm up as we go through the year. And that could be sort of the third benefit as well.

Speaker Change: We had previously communicated we were targeting to raise $1 $6 billion and so I mentioned.

Speaker Change: In my prepared remarks that we have committed financing up to $1 3 billion, so and that's a combination of finance leases and just some bilateral.

Speaker Change: Bank loans.

Speaker Change: Obviously with the adjusted.

Speaker Change: <unk> revenue that we provided today, we'll most likely need to raise some incremental capital beyond the one six that we originally targeted so we will clearly be out in the market later this year and as a reminder, we've got a healthy mix of unencumbered assets. So.

Ursula L. Hurley: Got it. And then, if I might ask Ursula, just on the financing for this year, could you talk about, you know, what you're seeing? And just as all of that kind of comes together, what you're kind of expecting in terms of net interest expense? Yeah.

Ursula L. Hurley: Yeah, thanks, Savi. So we had previously communicated that we were targeting to raise $1.6 billion. And so I mentioned in my prepared remarks that we've committed financing up to $1.3 billion. So that's a combination of finance leases and just some bilateral bank loans.

Speaker Change: We can optimize across markets to focus on quite frankly, the cost of the debt as well as building in some prepayment flexibility because those are priorities of ours in terms of interest expense on a full year basis in my prepared remarks and.

Ursula L. Hurley: Obviously, with the adjusted revenue that we provided today, we'll most likely need to raise some incremental capital beyond the $1.6 billion that we originally targeted. So we will clearly be out in the market later this year. And as a reminder, we've got a healthy mix of unencumbered assets. So we can optimize across markets to focus on, quite frankly, the cost of the debt as well as build in some prepayment flexibility because those are priorities of ours.

Speaker Change: January I provided.

Speaker Change: Guidance $320 million to $330 million.

Speaker Change: We are trending even despite having to raise incremental debt. We are we're trending slightly below that just given we've been more thoughtful about the timing that we're bringing in cash but also we've been seeing some relief on in terms of rate as well. So hopefully that gives you a little bit.

Ursula L. Hurley: In terms of interest expense on a full year basis, in my prepared remarks in January, I provided guidance of $320 million to $330 million. We are trending, even despite having to raise incremental debt, slightly below that. Just given, we've been more thoughtful about the timing that we're bringing in cash, but we've also been seeing some relief in terms of rates as well. So hopefully, that gives you a little bit of color.

Speaker Change: Color.

Speaker Change: Very helpful. Thank you.

Speaker Change: Okay.

Speaker Change: Our next question will come from Helane Becker with TD Cowen.

Helane Renee Becker: Thanks, very much operator, hi, everybody just one.

Helane Renee Becker: One point of clarification.

Helane Renee Becker: In your slide I think in my opinion, it's slide nine but it might be slide eight you talk about not having any significant debt due before 2026.

Helane Renee Becker: Our next question will come from Helane Becker with TD Coward.

Helane Renee Becker: And maybe you just answered this in <unk> question. I think you also have a $750 million convert that has to be addressed are you thinking of refinancing.

Helane Renee Becker: Thanks very much, Operator. Hi everybody. Just, Ursula, one point of clarification.

Ursula L. Hurley: In your slide, I think, on my page, it's slide nine, but it might be slide eight, you talk about not having any significant death due before 2026. I think you also have a $750 million debt that has to be addressed. Are you thinking of refinancing your debt that's coming due? How should we think about, I guess maybe replacing debt versus paying down debt.

Helane Renee Becker: Your your debt that's coming due like how should we think about.

Helane Renee Becker: I guess, maybe replacing debt versus paying down debt.

Speaker Change: Yeah. Thanks for the question Helane. So in regards to the comment in the presentation. The significant debt maturity due in 2026 that actually is the convertible debt deal.

Ursula L. Hurley: Yeah, thanks for the question, Helane. So in regards to the comment in the presentation, the significant debt maturity due in 2026, that actually is a convertible debt deal. So that's the next significant maturity that we'll face. We do intend to refinance that. It's quite early at this point, but the team's exploring opportunities to refinance that. Again, we've got a significant amount of unencumbered collateral, and we can target specific markets just through the lens of raising, you know, the most cost-effective money.

Speaker Change: So that's the the next significant maturity that will face.

Speaker Change: We do intend to refinance that it's quite early at this point, but the teams are exploring opportunities to refinance that.

Speaker Change: Again, we've got a significant amount of unencumbered collateral and we can target specific markets and.

Speaker Change: Just through the lens of raising the most cost effective money that is.

Speaker Change: The convertible debt is the most friendly.

Speaker Change: In terms of rate that we have in the capital structure. So in terms of financing, we will do that as close to maturity as possible.

Ursula L. Hurley: That is, the convertible debt is the most friendly in terms of the rate that we have in the capital structure. So in terms of financing, we'll do that as close to maturity as possible. And we got to get the business back to profitability so that we're actually generating free cash flow so that we can then pivot to actually start paying down debt. That is the goal that we're focused on.

Speaker Change: We got to get the business back to profitability. So that we're actually generating free cash flow. So that we can then pivot to actually start paying down debt and that is the goal that we're focused on.

Ursula L. Hurley: Okay, that's very helpful. Thanks, Ursula. And then, on the $562 million of special items in the quarter, can you say, like, what percent was related to Spirit versus opt-out versus the E-190 transition? And are all the Spirit costs now behind you?

Speaker Change: Okay. That's very helpful. Thanks, and then.

Speaker Change: On the $562 million of special items in the quarter can you say like what percent was related to spirit versus opt out versus the <unk> hundred 90, 90 transition and are all the spirit costs now behind you.

Speaker Change: And so put very simply all of the spirit costs are behind us and the $560 million 530 ish million were associated with spirit.

Ursula L. Hurley: So, put very simply, all of the spirits costs are behind us, and of the $560 million, $530-ish million were associated with spirits.

Ursula L. Hurley: Thanks. Thanks very much, team. Thanks, Ursula.

Speaker Change: Thanks, Thanks, very much Kim Thanks Ursula.

Speaker Change: Our next question will come from Scott Group with Wolfe Research.

Scott H. Group: Our next question will come from Scott Group with Wolf Research.

Scott H. Group: Hey, thanks. Good morning.

Scott H. Group: Hey, Thanks, good morning, So I understand.

Ursula L. Hurley: So I understand I'm not breakeven for the year. I'm just wondering, do you see a path back to breakeven in the second half? And then I just want to clarify that the second quarter sort of rasm. So I guess, given Latin, it seems like domestic rasm flats up slightly year over year. Is that right? And, I guess, why not better, just given domestic capacity down over the past year

Scott H. Group: The breakeven for the year I'm, just wondering do you see a path back to a breakeven in the second half and then I just wanted to clarify the second quarter or sort of RASM. So I guess given.

Scott H. Group: It seems like domestic RASM flat to up slightly year over year is that right and I guess why not better just given domestic capacity down over 10%.

Ursula L. Hurley: Yeah, so I'll take the first part of the question in terms of operating margin. And make no mistake, our number one priority is getting this business back to consistent profitability. We were profitable in the month of March, and we're focused on driving sustainable long-term profitability. And, you know, I, we were in an environment where we were constrained over the last few years, given the state of the company. And so I feel confident that we're showing action between the network changes, the revenue initiatives, controllable costs, as well as reducing our fixed costs. I do believe that these actions are going to continue to ramp up and put us on a path to drive creative value.

Speaker Change: Yes, so I'll take the first part of the question in terms of operating margin.

Speaker Change: Make no mistake, our number one priority is getting this business back to consistent profitability, we were profitable in the months of March and the month of March and we're focused on driving sustainable long term profitability.

Speaker Change: We were in an environment, where we were constrained over the last few years, given spirit and so I feel confident that we're showing action between the network changes the revenue initiatives controllable costs.

Speaker Change: As well as reducing our fixed costs I do believe that these actions are going to continue to ramp up and put us on a path to drive accretive value in terms of the second half of the year I mean.

Ursula L. Hurley: In terms of the second half of the year, I mean, it's a little early to tell. It's very dependent on the strength of the peak period demand during the summer and, obviously, over the holidays in November and December and fuel. I mean, we can't ignore that the volatility of fuel over the last few weeks has been extremely volatile. So it's challenging to tell whether we'll break even in 2H. Obviously, that's the ultimate goal.

Speaker Change: It's a little early to tell I mean, it's very dependent on the strength of the peak periods of demand during the summer and obviously over the holidays in November and December and fuel I mean, we can't ignore that the volatility of fuel over the last few weeks. It has been extremely volatile so it's challenge.

Speaker Change: Trying to tell them, whether we're breakeven in two age obviously, that's the ultimate goal.

David C. Clark: And then, Scott, this is Dave. With regard to the second quarter RASM question, so yes, Latin is the entire headwind, right? It's down mid-teens. As we said in the presentation, it's about 35% of our capacity. So that's a big piece.

Speaker Change: Yeah.

Speaker Change: And then Scott this is Dave with regards to the second quarter RASM question. So yes is the entire headwind right. It's down mid teens as we said in the presentation. It's about 35% of our capacity. So that's a big piece. If you look at the rest of our network excluding.

David C. Clark: If you look at the rest of our network, excluding Latin, it continues to be RASM positive, as it was in the first quarter. And then, in terms of why it might not be better, regardless, given the capacity being down, keep in mind, you know, we're still competing against very significant pent-up demand. Last year, in the first half of the year, especially spring break destinations, had pent-up demand that had been sort of built up during COVID. And then, secondly, competitive capacity does tick up a bit for us in the second quarter. It's one point higher than it was in the first round, so there's a bit of pressure there as well.

It continues to be RASM positive as it was in the first quarter and then in terms of why not better.

Dave: Regardless, given the capacity being down keep in mind, we're still comping against very significant pent up demand last year in the first half of the year is especially spring break destinations had pent up demand that had been sort of built up during COVID-19.

Dave: Then secondly, competitive capacity does pick up a bit for us in the second quarter. Its one point higher than it was in the first so theres a bit of pressure there as well.

Ursula L. Hurley: Okay, that's helpful. And then separately, on the cash balance, can you just let us know where the ATL stood at the end of the quarter? And then on the financing side, are there any covenants we need to be aware of just in terms of limits on how much more debt you can take on?

Speaker Change: Okay. That's helpful and then just separately.

Speaker Change: On the cash balance can you just let us know where the ATL stood at the end of the quarter and then on the financing side are there any covenants, we need to be aware of just in terms of.

Speaker Change: Limits on how much more debt you can.

Ursula L. Hurley: Yeah, thanks for the question, Scott. And we'll take the ATL question offline. I'll have Koosh circle up with you.

Speaker Change: Reyes.

Reyes: Yes. Thanks for the question Scott will take the ATR question offline I'll have him Couche circle up with you there hasn't been a material change and then in regards to your covenants question Theres nothing material I mean in a few of our agreements we have them in liquidity target, which we are more than well.

Ursula L. Hurley: There hasn't been a material change. And then, in regards to your covenants question, there's nothing material. I mean, in a few of our agreements, we have a minimum liquidity target, which we are more than well above. So there's nothing else material beyond that.

Speaker Change: <unk>.

Speaker Change: So theres nothing else material beyond that.

Operator: Thank you, guys. I appreciate it.

Okay. Thank you guys appreciate it.

Christopher Nicholas Stathoulopoulos: Our next question will come from Chris Stathoulopoulos with Susquehanna International Group.

Speaker Change: Our next question will come from Chris <unk> with Susquehanna International Group.

Joanna L. Geraghty: Good morning. Thanks for taking my question. So, Joanna or Dave, I understand the revised revenue guide, primarily due to LATAM and the full trough line, but if you could give a finer detail as we think about perhaps the zero to 60-day booking window, but then also the second half when we look at the various segments. So maybe you could give a finer detail, domestic leisure, business, short haul, international, long haul, peak, off-peak.

Chris: Good morning, Thanks for taking my question so.

Chris: Joanna or Dave.

Chris: Understand.

Chris: The revised revenue guidance, primarily due to Latam and for trough line, but if you could put a finer details we think about.

Perhaps the zero to 60 day booking window, but then also the second half when we look at the various segments. So maybe if you could put a finer detail domestic leisure business short haul international long haul peak off peak and then tying it all together just kind of what gives you the confidence here that other parts of the network I know you have the ancillary.

Joanna L. Geraghty: And then, you know, tying it all together, just kind of what gives you the confidence here that, you know, other parts of the network. I know you have the ancillary initiatives in place, but that can offset what looks like this persistent LATAM weakness. Thank you.

Chris: Initiatives in place, but that can offset what looks like this persistent.

Speaker Change: Latam weakness. Thank you, yes, maybe I'll take the kind of second flip it today for a deep dive on the network by geography.

David C. Clark: Yeah, maybe I'll take the second flip of the day for a deep dive on the network by geography. So, you know, we're confident that the Latin headwinds are transitory in nature.

Speaker Change: So we're confident that the Latin headwinds are transitory in nature.

Joanna L. Geraghty: You know, we've seen capacity while it's still up, it is moderating, and it will continue to moderate in Latin through the rest of the year. And the reality is, this is a very strong market for Jet Blue from a margin perspective, and it will continue to be. These headwinds are transitory, and, you know, we're going to continue to double down in this area because this is part of our core part of our core geography.

Speaker Change: We've seen capacity wallet is still up it is moderating and it continues to moderate and Latin through through the rest of the year.

Speaker Change: And in the reality is this is a very strong market for jetblue from a margin perspective, and it will continue to be.

Speaker Change: These headwinds are transitory and we're going to continue to double down in this area. Because this is part of our core part of our core geography, we're pleased with the progress of domestic.

Joanna L. Geraghty: We're pleased with the progress of domestic that has, you know, generated positive unit revenue into Q1 and then into Q2. We expect to see about the same. Transatlantic RASM is up 20% against significant capacity ads in that region. So, again, very happy there. So, as we think about kind of looking at the full year, this Latin headwind, given the presence of Jet Blue in those markets, 35% is really, you know, the big challenge that we're currently facing. But we've been there before. It will cycle out, and Jet Blue will win in these geographies. Dave, if you'd like to maybe take a deeper dive into some of the other areas. Yeah, thanks, Kristen.

Speaker Change: And that has.

Speaker Change: Generated positive unit revenue into Q1, and then into Q2, we expect to see about the same trans Atlantic RASM was up 20%.

Speaker Change: <unk>.

Speaker Change: Capacity adds in that region. So again very happy there and so as we think about kind of looking at the full year. This Latin headwind given the presence of Jetblue and that those markets, 35% is really the big challenge that we're currently facing but we've been there before it will cycle out and Jetblue will win in these geographies, Dave if you'd.

Dave: Like to maybe grab a deeper dive on some of the other areas. Yes. Thanks, Kristen I think you'd noted theres a lot of different moving pieces.

David C. Clark: You know, I think, there are a lot of different moving pieces as sort of we come out of this COVID period. You know, to address a couple of them, peaks remain stronger than off peaks. You know, that's been consistent for about a year or so now.

Dave: Sort of we come out of this COVID-19 period.

Dave: To address a couple of them peaks remains stronger than off peaks.

Dave: That's been consistent for about a year or so now we're taking those learnings and continuing to plan our trough periods.

David C. Clark: We're taking those learnings and continuing to plan our trough period a bit differently than we had before in order to try to drive the best financial performance during that. We've already been doing that for the fall trough. As mentioned, we're going to pull a bit more capacity out of the fall trough as well. So, we're working hard with those learnings. You know, the competition gets easier as we go through the year, as we sort of get away from cycling against this pent-up COVID demand that we've seen in the first half.

Dave: Bit differently than we've had before in order to drive that drive the best financial performance during that we've already been doing that for the fall trough as mentioned, we're going to pull a bit more capacity the fall trough as well so working hard with those learnings.

Dave: The comp gets easier as we go through the year as we sort of get away from cycling against this pent up demand that we've seen in the first half. So thats another piece too and then lastly, I mean, the booking window.

Dave: We still have customers booking relatively close to it and that's where the majority of our revenue comes that can give us.

David C. Clark: So, that's another piece, too. And then lastly, I mean, the booking window. We still have customers booking relatively close in. That's where the majority of our revenue comes from. It can give us, you know, more challenges looking further ahead, which is why we sort of go one quarter at a time generally with our guidance. The booking curve has moved out a little bit, I'd say, over the past year as sort of COVID concerns have dissipated and as more and more customers are buying, you know, our blue fare, which is our main cabin fare and has no change fees.

Dave: More challenges looking further ahead, which is why we sort of go one quarter at a time generally with our guidance the booking curve has moved a little bit.

I'd say over the past year as sort of Cobra concerns have dissipated.

Dave: As more and more customers are buying our blue fare, which is our main Kevin fair and has no change for you. So there's less risk to book further out but.

Dave: But within all of those things we feel really good.

About the moves we're making about the <unk>.

Dave: Geography over the long term as it cycles through this temporary increased competitive capacity and feel that all parts of our network with the moves we're making there'll be contributing meaningfully in the future.

David C. Clark: So, there's less risk to book further out. But within all those things, we feel really good about the moves we're making in our Latin geography over the long term as it cycles through this temporary increased competitive capacity, and we feel that all parts of our network with the moves we're making are going to be contributing meaningfully in the future.

Speaker Change: Okay. Thank you and my follow up so on slide seven here, where you referenced.

Speaker Change: Central for exploring additional cost savings opportunities could you walk us through sort of what areas.

Speaker Change: We're thinking about there whether it's on maintenance, where there is perhaps additional opportunities within these voluntary op out.

Ursula L. Hurley: Okay, thank you. And my follow up. So on slide seven here, where you referenced the potential for exploring additional cost savings opportunities, could you walk us through sort of what areas you're thinking about there, whether it's maintenance, or there's perhaps additional opportunities within these voluntary opt-outs. And within that, could you kind of clarify the work groups that those have been applied to, but also, does that opportunity also move with depending on where these fall trough capacity revisions are made? Thank you. Yes, so we have

Speaker Change: Within that if you could kind of clarify the work groups that those have been applied to but also.

Speaker Change: Does that opportunity also move with depending on what were these fall trough.

Speaker Change: City revisions are made thank you.

Yes, so we have committed given the accounting change due to the Pratt and Whitney GTS compensation, we have to your point committed to offset a good portion of that and so the team has identified opportunities.

Speaker Change: To better leverage technology to drive better productivity in our frontline workforce and also being more strategic and thoughtful about maintenance timing as well as what level of investments take place when obviously not.

Ursula L. Hurley: Yes, so we have committed, given the accounting change due to the Pratt & Whitney GTF compensation, we have, to your point, committed to offset a good portion of that. And so the team has identified opportunities to better leverage technology to drive better productivity in our frontline workforce and also be more strategic and thoughtful about maintenance timing, as well as what level of investment takes place when, obviously not at the expense of safety.

Speaker Change: At the at the expense of safety.

Speaker Change: And so these are areas that the team is doubling down on to help overcome the prod offset in.

Speaker Change: In terms of the opt out.

Speaker Change: That has trended where we thought it would.

Ursula L. Hurley: And so these are areas that the team is doubling down on to help overcome the Pratt offset. In terms of the opt-out, that has trended where we thought it would. The areas that were covered within the opt-out are our support centers, so corporate functions, as well as some of the frontline workgroups. And so we also, I do think we're pleased with the results. The other area we've been diving into is real estate footprints and downsizing in high-cost cities.

Speaker Change: The areas that were covered within the opt out or our support center, so think corporate functions.

Speaker Change: As well as <unk>.

Speaker Change: Some of the frontline.

Speaker Change: Work groups.

Speaker Change: And so we also so I do think we're pleased with the result.

Speaker Change: Other area, we've been diving into.

Speaker Change: Is real estate footprints and downsizing and high cost cities and then the third focus continues and always continues in terms of strategic sourcing and just working to be more thoughtful and strategic about the contracts that we enter into them whether it be pricing.

Ursula L. Hurley: And then the third focus continues and always continues in terms of strategic sourcing and just working to be more thoughtful and strategic about the contracts that we enter into, whether it be pricing, service expectations, as well as variability to move with the business.

Speaker Change: Service expectations as well as variability.

Speaker Change: To move with the business.

Speaker Change: Okay. Thank you.

Conor T. Cunningham: Our next question will come from Conor Cunningham with Milius Research.

Speaker Change: Okay.

Speaker Change: Our next question will come from Conor Cunningham with Melius research.

Marty St. George: Everyone, thank you. You know, as you've made all these network changes, I was wondering how you're gauging your change in relevancy with your core customers. You didn't cite any loyalty numbers or credit card signups. I'm just curious about why the lack of comments there. Is there anything to dive deeper into that?

Conor T. Cunningham: Everyone. Thank you.

Conor T. Cunningham: You know as you've made all these network changes I was wondering how you're gauging your change and relevancy with your core customers.

Conor T. Cunningham: You didn't cite any loyalty members or credit card sign ups, just curious on why the lack of comments there is there anything that.

Speaker Change: <unk> deeper into that thank you.

Marty St. George: Yep, sure. I think we mentioned in Marty's prepared remarks some loyalty commentary, but I think importantly, the network changes are focused around retrenching into our core strengths, which should drive improvement and relevance for our customers who tend to be overindexing in those areas. So think New York, Boston, South Florida.

Speaker Change: Yeah sure. So I think we mentioned in marty's prepared remarks, some loyalty commentary, but I think importantly, the network changes are focused around retrenching into our core strength, which should drive.

Speaker Change: <unk> and relevance for our customers.

Speaker Change: Who tend to be over indexing in those areas. So I think New York, Boston, South, Florida, We're really pleased with loyalty and we've had strong growth of our true blue base below mosaic in Q1 versus Q1 'twenty three.

Marty St. George: We're really pleased with loyalty, and we've had strong growth of our True Blue base below Mosaic in Q1 versus Q1-23. Our Mosaics continue to grow. We have a much higher attach rate this quarter compared to year-over-year. We've seen healthy growth in customer spend, and healthy remuneration from Barclays. So we're very pleased with their trajectory. The majority of our Mosaics now hold a JetBlue co-brand credit card. So I think that's a great indicator of the value that they place on the loyalty program and the value that the Barclays co-brand card drives.

Speaker Change: Our mosaic continued to grow we'd have a much higher attach rate this quarter compared to year over year, and we've seen healthy growth in customer spend healthier remuneration from Barclays. So we're very pleased with the trajectory and the majority of our mosaic now hold the Jetblue co brand credit card. So I think thats a great.

Indicator of the value that they place and the loyalty program and the value that the Barclays Co brand card drives the other piece I mentioned as we've introduced a number of new purchase this quarter. We will continue to introduce new perks and we think we've got more opportunity with diversification of the card portfolio products. So overall I think a lot of great.

Marty St. George: I'm actually excited by this retrenchment because I think it will actually drive even more relevance for our customers in those locations. Marty, do you have something to add? most specifically in Boston, to a lesser extent in Fort Lauderdale.

Speaker Change: Yes, there, but we're focused on being highly relevant in our key focus cities and over the last several years some of that relevance came at the expense of those focus cities, because we pause things for spirit or because NEA was in place that we had to draw down from certain areas I'm actually excited by this retrenching, because I think it will actually drive even more relevance for our customers in those locations Marty if something that yes.

Marty St. George: And you look over the last five years, we've actually done a lot of compromising on the schedules to take advantage of things like the NEA. And frankly, you know, going from 20-something flights to 50-something flights in LaGuardia, those planes came from somewhere, and a lot of that came from schedule quality. So I would actually say the exact opposite, which is that this is actually going to supercharge the schedule quality in some markets that we've neglected over the years because we were trying to do a lot of things at the same time. And I'm actually very excited about what this is giving us the opportunity to do as far as reclaiming some of the strength that we've had historically.

Speaker Change: I think if you actually were to look at the schedule patterns that we've had.

Speaker Change: Most specifically in Boston to a lesser extent in Fort Lauderdale.

Speaker Change: And you look over the last five years, we've actually done a lot of compromising on our schedules to take advantage of things like the NDA and frankly.

Going from 20, something flights to 50 something flights from Laguardia those planes came from somewhere and lot of that came from schedule quality. So I would actually say the exact opposite which is this is actually going to supercharge their scheduled quality in some markets, we've actually like neglected over the years, because we were trying to do a lot of things at the same time and I'm actually very excited about what does it give me this is really to do.

Speaker Change: As far as reclaiming some of the strength that we've had historically.

Marty St. George: But that's helpful. And then

Speaker Change: That's helpful and then.

Marty St. George: I've heard a lot of talk about Latin America headwinds being somewhat transitory, and I'm trying to understand why you think that. Do you expect the market to shrink, or do you believe it just takes a little bit of time for it to mature a little bit from here? Just trying to understand the transitory comment there. Thank you.

Speaker Change: I've heard a lot of talk about Latin America headwinds being somewhat transitory and I don't I'm trying to understand why why do you think that do you expect the market to shrink or do you believe this just it just takes a little bit of time for it to mature a little bit from here I'm just trying to understand the transitory comments there. Thank you.

Marty St. George: So I'll make two comments. First of all, I think if you look at total ASMs to Latin America since, as you know, short Latin America, the Caribbean, since 2019, they're up 50 or 60, like 60%. Now, to be clear, there has been a permanent shift in, you know, the business leisure mix, and a lot of those ASMs have actually been absorbed by the marketplace. That being the case, I think if you look back six or nine months when the industry was all talking about Florida and how much capacity is thrown into Orlando, capacity tends to moderate when RASM is pressured.

Speaker Change: So I'll make two comments first of all I think if you look at.

Total ASM to Latin America, since short Latin and Caribbean.

Speaker Change: Since 2019 about 50 or 60% now to be clear there has been a permanent shift in the business leisure mix and a lot of those <unk> sorry.

Speaker Change: Now those cases, a lot of those are some have actually been absorbed by the marketplace.

Speaker Change: That being the case I think if you look at go back six or nine months.

Speaker Change: The industry was all talking about Florida, and how much capacity has grown in Orlando.

Speaker Change: Capacity tends to moderate when RASM is pressured and frankly this is the period, where RASM is pressured.

Marty St. George: And frankly, this is a period when RASM is pressured. And, you know, I think if you look at the way capacity ebbs and flows, it does tend to return to the mean, and mostly because there's opportunity costs. You know, frankly, I think that we're already seeing a bit of that moderation, and we expect to see it continue.

Speaker Change: And I think if you look at the way capacity ebbs and flows it does tend to be to return to the mean and mostly because there is opportunity cost for every ASM that we fly and every other semi competitive slot. So.

Speaker Change: Frankly, I think that we're already seeing a bit of that moderation already and we expect to see it continue.

Speaker Change: Okay. Thank you.

Speaker Change: Our final question will come from Stephen Trent with Citi.

Stephen Trent: Many thanks to everybody and I. Appreciate you squeezing me in just one very quick follow up.

Marty St. George: Okay, thank you. Our final question will come from Stephen Trent with Citi. Many thanks to everybody, and I appreciate you squeezing me in. Just one very quick follow-up to...

Stephen Trent: Joe <unk> question earlier, when we think about.

Stephen Trent: Your cash level do you sort of have a.

Stephen Trent: Our final question will come from Stephen Trent with Citi. Many thanks.

Stephen Trent: Minimum cash balance in mind that you think about maintaining his.

Ursula L. Hurley: Thanks, Stephen. And yeah, we target about $1.5 to $1.6 billion in cash on hand at any point in time. We actually ended the quarter slightly on the higher end of that. As a reminder, we have a $600 million revolving credit facility. So between cash on hand and the revolver, we think that that's a healthy balance. And also, as a reminder, we've got a healthy unencumbered asset base as well that we can utilize at any point to raise funding when necessary.

Stephen Trent: You look at your aircraft needs in 2026 convert would just love your color on that thank you.

Thanks, Steven and Yeah, we target about one five to one 6 billion in cash on hand at any point in time.

Speaker Change: We actually.

Speaker Change: Ended the quarter slightly on the higher end of that and as a reminder, we have a $600 million revolving credit facility. So between cash on hand, and the revolver, we think that that's a healthy balance.

Speaker Change: And also as a reminder, we've got a healthy unencumbered asset base as well that we can utilize at any point to raise funding when necessary.

Koosh Patel: That will conclude today's question and answer session. I will now turn the conference over to Mr. Patel for any additional closing remarks.

Speaker Change: Okay appreciate that thank you.

Koosh Patel: That will conclude today's question and answer session I will now turn the conference over to Mr. Patel for any additional closing remarks.

Koosh Patel: And that concludes our first quarter 2024 call. Thanks for joining us, and have a great day.

Koosh Patel: Yeah.

Patel: And that concludes our first quarter 2024 call. Thanks for joining us and have a great day.

Operator: And again, that will conclude today's conference. Thank you for your participation.

Speaker Change: And again that will conclude today's conference. Thank you for your participation.

Speaker Change: Mhm.

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Speaker Change:

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Speaker Change: Mhm.

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