10-Q 1 jblu-20220331.htm 10-Q jblu-20220331
000115846312/312022Q1falseReconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets:
March 31, 2022March 31, 2021
Cash and cash equivalents$1,815 $2,358 
Restricted cash$67 52 
Total cash, cash equivalents and restricted cash$1,882 $2,410 
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q

    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2022
or
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from __________ to__________
Commission File Number: 000-49728
jblu-20220331_g1.jpg
JETBLUE AIRWAYS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware87-0617894
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
27-01 Queens Plaza North
Long Island City
New York
11101
(Address of principal executive offices)  (Zip Code)
(718) 286-7900
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, $0.01 par valueJBLUThe NASDAQ Stock Market LLC
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer Accelerated filer
Non-accelerated filer Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes      No
As of March 31, 2022, there were 320,789,028 shares outstanding of the registrant’s common stock, par value $0.01.


JETBLUE AIRWAYS CORPORATION
FORM 10-Q
INDEX
Page


2

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED BALANCE SHEETS
(unaudited, in millions, except per share data)


March 31, 2022December 31, 2021
ASSETS
CURRENT ASSETS
Cash and cash equivalents$1,834 $2,018 
Investment securities950 824 
Receivables, less allowance (2022-$3; 2021-$3)
248 207 
Inventories, less allowance (2022-$25; 2021-$24)
68 74 
Prepaid expenses and other172 124 
Total current assets3,272 3,247 
PROPERTY AND EQUIPMENT 
Flight equipment11,265 11,161 
Predelivery deposits for flight equipment369 337 
Total flight equipment and predelivery deposits, gross11,634 11,498 
Less accumulated depreciation3,324 3,227 
Total flight equipment and predelivery deposits, net8,310 8,271 
Other property and equipment1,228 1,205 
Less accumulated depreciation681 662 
Total other property and equipment, net547 543 
Total property and equipment, net8,857 8,814 
OPERATING LEASE ASSETS767 729 
OTHER ASSETS 
Investment securities110 39 
Restricted cash67 59 
Intangible assets, less accumulated amortization (2022-$417; 2021-$405)
274 284 
Other456 470 
Total other assets907 852 
TOTAL ASSETS$13,803 $13,642 
See accompanying notes to condensed consolidated financial statements.
3

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED BALANCE SHEETS
(unaudited, in millions, except per share data)
March 31, 2022December 31, 2021
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable$624 $499 
Air traffic liability1,939 1,618 
Accrued salaries, wages and benefits478 480 
Other accrued liabilities496 359 
Current operating lease liabilities108 106 
Current maturities of long-term debt and finance lease obligations381 355 
Total current liabilities4,026 3,417 
LONG-TERM DEBT AND FINANCE LEASE OBLIGATIONS3,545 3,651 
LONG-TERM OPERATING LEASE LIABILITIES726 690 
DEFERRED TAXES AND OTHER LIABILITIES  
Deferred income taxes702 843 
Air traffic liability - non-current655 640 
Other551 552 
Total deferred taxes and other liabilities1,908 2,035 
COMMITMENTS AND CONTINGENCIES (Note 6)
STOCKHOLDERS’ EQUITY  
Preferred stock, $0.01 par value; 25 shares authorized, none issued
  
Common stock, $0.01 par value; 900 shares authorized, 479 and 478 shares issued and 321 and 320 shares outstanding at March 31, 2022 and December 31, 2021, respectively
5 5 
Treasury stock, at cost; 158 and 158 shares at March 31, 2022 and December 31, 2021, respectively
(1,995)(1,989)
Additional paid-in capital3,058 3,047 
Retained earnings2,531 2,786 
Accumulated other comprehensive (loss)(1) 
Total stockholders’ equity3,598 3,849 
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY$13,803 $13,642 


See accompanying notes to condensed consolidated financial statements.
4

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in millions, except per share data)

Three Months Ended March 31,
20222021
OPERATING REVENUES
Passenger$1,603 $670 
Other133 63 
Total operating revenues1,736 733 
OPERATING EXPENSES
Aircraft fuel and related taxes571 193 
Salaries, wages and benefits688 521 
Landing fees and other rents132 115 
Depreciation and amortization143 125 
Aircraft rent26 25 
Sales and marketing57 23 
Maintenance, materials and repairs152 104 
Other operating expenses334 210 
Special items (289)
Total operating expenses2,103 1,027 
OPERATING LOSS(367)(294)
OTHER INCOME (EXPENSE)
Interest expense(37)(58)
Interest income4 4 
Gain on investments, net2 4 
Other (3)
Total other income (expense)(31)(53)
LOSS BEFORE INCOME TAXES(398)(347)
Income tax benefit(143)(100)
NET LOSS$(255)$(247)
LOSS PER COMMON SHARE:
Basic$(0.79)$(0.78)
Diluted$(0.79)$(0.78)


See accompanying notes to condensed consolidated financial statements.
5

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(unaudited, in millions)
Three Months Ended March 31,
20222021
NET LOSS$(255)$(247)
Changes in fair value of available-for-sale securities, net of reclassifications into earnings, net of deferred taxes of $0 and $0 in 2022 and 2021, respectively
(1) 
Total other comprehensive loss(1) 
COMPREHENSIVE LOSS $(256)$(247)

See accompanying notes to condensed consolidated financial statements.
6

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in millions)
Three Months Ended March 31,
20222021
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss$(255)$(247)
Adjustments to reconcile net loss to net cash provided by operating activities:
Deferred income taxes(141)(97)
Depreciation130 117 
Amortization13 8 
Stock-based compensation11 8 
Changes in certain operating assets and liabilities499 304 
Deferred federal payroll support program grants 87 
Other, net(10)(3)
Net cash provided by operating activities247 177 
CASH FLOWS FROM INVESTING ACTIVITIES 
Capital expenditures(85)(211)
Predelivery deposits for flight equipment(49)(6)
Purchase of held-to-maturity investments(63) 
Purchase of available-for-sale securities(290) 
Proceeds from the sale of available-for-sale securities153 270 
Other, net (1)
Net cash provided by (used in) investing activities(334)52 
CASH FLOWS FROM FINANCING ACTIVITIES 
Proceeds from issuance of long-term debt 855 
Proceeds from issuance of stock warrants 8 
Repayment of long-term debt and finance lease obligations(83)(644)
Acquisition of treasury stock(6)(6)
Other, net (1)
Net cash provided by (used in) financing activities(89)212 
INCREASE (DECREASE) IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH(176)441 
Cash, cash equivalents and restricted cash at beginning of period2,077 1,969 
Cash, cash equivalents and restricted cash at end of period(1)
$1,901 $2,410 
SUPPLEMENTAL CASH FLOW INFORMATION
Cash payments for interest
$20 $40 
See accompanying notes to condensed consolidated financial statements.
7

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in millions)
Three Months Ended March 31,
20222021
Cash payments for income taxes (net of refunds)
1  
NON-CASH TRANSACTIONS
Operating lease assets obtained under operating leases$59 $ 
(1) Reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets:
March 31, 2022March 31, 2021
Cash and cash equivalents$1,834 $2,358 
Restricted cash(2)
67 52 
Total cash, cash equivalents and restricted cash$1,901 $2,410 
(2) Restricted cash primarily consists of security deposits, funds held in escrow for estimated workers’ compensation obligations, and performance bonds for aircraft and facility leases.
See accompanying notes to condensed consolidated financial statements.
8

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(unaudited, in millions)

Common
Shares
Common
Stock
Treasury
Shares
Treasury
Stock
Additional
Paid-In
Capital
Retained
Earnings
Accumulated
Other
Comprehensive
Income (Loss)
Total
Balance at December 31, 2021478 $5 158 $(1,989)$3,047 $2,786 $ $3,849 
Net loss— — — — — (255)— (255)
Other comprehensive (loss)— — — — — — (1)(1)
Vesting of restricted stock units1 — — (6)— — — (6)
Stock compensation expense— — — — 11 — — 11 
Balance at March 31, 2022479 $5 158 $(1,995)$3,058 $2,531 $(1)$3,598 
Common
Shares
Common
Stock
Treasury
Shares
Treasury
Stock
Additional
Paid-In
Capital
Retained
Earnings
Accumulated
Other
Comprehensive
 Income
Total
Balance at December 31, 2020474 $5 158 $(1,981)$2,959 $2,968 $ $3,951 
Net loss— — — — — (247)— (247)
Vesting of restricted stock units1 — — (6)— — — (6)
Stock compensation expense— — — — 8 — — 8 
Warrants issued under federal support programs— — — — 8 — — 8 
Balance at March 31, 2021475 $5 158 $(1,987)$2,975 $2,721 $ $3,714 

See accompanying notes to condensed consolidated financial statements.
9

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)


Note 1—Summary of Significant Accounting Policies
Basis of Presentation
JetBlue Airways Corporation, or JetBlue, provides air transportation services across the United States, the Caribbean and Latin America, and between New York and London. Our condensed consolidated financial statements include the accounts of JetBlue and our subsidiaries which are collectively referred to as “we” or the “Company”. All majority-owned subsidiaries are consolidated on a line by line basis, with all intercompany transactions and balances being eliminated. These condensed consolidated financial statements and related notes should be read in conjunction with our 2021 audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021, or our 2021 Form 10-K.
These condensed consolidated financial statements are unaudited and have been prepared by us following the rules and regulations of the U.S. Securities and Exchange Commission, or the SEC. In our opinion they reflect all adjustments, including normal recurring items, that are necessary to present fairly the results for interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States, or GAAP, have been condensed or omitted as permitted by such rules and regulations; however, we believe that the disclosures are adequate to make the information presented not misleading.
Due to the ongoing impacts from the coronavirus ("COVID-19") pandemic, seasonal variations in the demand for air travel, the volatility of aircraft fuel prices, and other factors, our operating results for the periods presented herein are not necessarily indicative of the results that may be expected for other interim periods or the entire fiscal year.
Investment Securities
Investment securities consist of available-for-sale investment securities, held-to-maturity investment securities, and equity securities. When sold, we use a specific identification method to determine the cost of the securities.
Available-for-sale investment securities. Our available-for-sale investment securities include investments such as time deposits, U.S. Treasury bills with maturities between three and twelve months, commercial paper, and convertible debt securities.
The fair values of these instruments are based on observable inputs in non-active markets, which are therefore classified as Level 2 in the fair value hierarchy. We did not record any material gains or losses on these securities during the three months ended March 31, 2022 or 2021. Refer to Note 7 to our condensed consolidated financial statements for an explanation of the fair value hierarchy structure.
Held-to-maturity investment securities. Our held-to-maturity investment securities consist of investment-grade interest bearing instruments, such as corporate bonds and U.S. Treasury notes, which are stated at amortized cost. We do not intend to sell these investment securities and the contractual maturities are not greater than 24 months. Those with maturities less than twelve months are included in short-term investments on our consolidated balance sheets. Those with remaining maturities in excess of twelve months are included in long-term investments on our consolidated balance sheets. We did not record any material gains or losses on these securities during the three months ended March 31, 2022 or 2021.
Equity investment securities. Our equity investment securities include investments in common stocks of publicly traded companies which are stated at fair value. We recognized a net unrealized loss of $2 million on these securities during the three months ended March 31, 2022. No gains or losses were recorded during the same period in 2021.
The aggregate carrying values of our short-term and long-term investment securities consisted of the following at March 31, 2022 and December 31, 2021 (in millions):

10

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

March 31, 2022December 31, 2021
Available-for-sale investment securities
Time deposits$865 $790 
Commercial paper61 2 
Debt securities10 8 
Total available-for-sale investment securities936 800 
Held-to-maturity investment securities
Corporate bonds100 37 
Total held-to-maturity investment securities100 37 
Equity investment securities24 26 
Total investment securities$1,060 $863 
Other Investments
Our wholly-owned subsidiary, JetBlue Technology Ventures, LLC, or JTV, has equity investments in emerging companies which do not have readily determinable fair values. In accordance with Topic 321, Investments - Equity Securities of the Financial Accounting Standards Board (the "FASB") Accounting Standards Codification (the "Codification"), we account for these investments using a measurement alternative which allows entities to measure these investments at cost, less any impairment, adjusted for changes from observable price changes in orderly transactions for identifiable or similar investments of the same issuer. The carrying amount of these investments, which is included within other assets on our consolidated balance sheet, was $73 million and $72 million as of March 31, 2022 and December 31, 2021, respectively. We did not record any material gains or losses on these investments during the three months ended March 31, 2022 and 2021.
We have an approximate 10% ownership interest in the TWA Flight Center Hotel at John F. Kennedy International Airport and it is also accounted for under the measurement alternative. The carrying amount of this investment was $14 million as of March 31, 2022 and December 31, 2021.
Equity Method Investments
Investments in which we can exercise significant influence are accounted for using the equity method in accordance with Topic 323, Investments - Equity Method and Joint Ventures of the FASB Codification. The carrying amount of our equity method investments was $37 million and $32 million as of March 31, 2022 and December 31, 2021, respectively, and is included within other assets on our consolidated balance sheets. In March 2022, we recognized a gain of $3 million on one of our equity method investments related to its issuance of additional shares upon the closing of a subsequent financing round.


Note 2— Revenue Recognition
The Company categorizes the revenues received from contracts with its customers by revenue source as we believe it best depicts the nature, amount, timing, and uncertainty of our revenue and cash flow. The following table provides the revenues recognized by revenue source for the three months ended March 31, 2022 and 2021 (in millions):
Three Months Ended March 31,
20222021
Passenger revenue
Passenger travel$1,490 $625 
Loyalty revenue - air transportation113 45 
Other revenue
Loyalty revenue88 45 
Other revenue45 18 
Total revenue$1,736 $733 

11

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

TrueBlue® is our customer loyalty program designed to reward and recognize our customers. TrueBlue® points earned from ticket purchases are presented as a reduction to Passenger travel within passenger revenue. Amounts presented in Loyalty revenue - air transportation represent the revenue recognized when TrueBlue® points have been redeemed and the travel has occurred. Loyalty revenue within other revenue is primarily comprised of the non-air transportation elements of the sales of our TrueBlue® points.
Contract Liabilities
Our contract liabilities primarily consist of ticket sales for which transportation has not yet been provided, unused credits available to customers, and outstanding loyalty points available for redemption (in millions):
March 31, 2022December 31, 2021
Air traffic liability - passenger travel$1,643 $1,323 
Air traffic liability - loyalty program (air transportation)912 891 
Deferred revenue(1)
595 613 
Total$3,150 $2,827 
(1) Deferred revenue is included within other accrued liabilities and other liabilities on our consolidated balance sheets.
During the three months ended March 31, 2022 and 2021, we recognized passenger revenue of $709 million and $237 million respectively, that was included in passenger travel liability at the beginning of the respective periods.
The Company elected the practical expedient that allows entities to not disclose the amount of the remaining transaction price and its expected timing of recognition for passenger tickets if the contract has an original expected duration of one year or less or if certain other conditions are met. We elected to apply this practical expedient to our contract liabilities relating to passenger travel and ancillary services as our tickets or any related passenger credits generally expire one year from the date of issuance.
TrueBlue® points are combined in one homogeneous pool and are not separately identifiable. As such, the revenue is comprised of the points that were part of the air traffic liability balance at the beginning of the period as well as points that were issued during the period.
The table below presents the activity of the current and non-current air traffic liability for our loyalty program, and includes points earned and sold to participating companies for the three months ended March 31, 2022 and 2021 (in millions):
Balance at December 31, 2021$891 
TrueBlue® points redeemed
(113)
TrueBlue® points earned and sold
134 
Balance at March 31, 2022$912 
Balance at December 31, 2020$733 
TrueBlue® points redeemed
(45)
TrueBlue® points earned and sold
70 
Balance at March 31, 2021$758 
The timing of our TrueBlue® point redemptions can vary; however, the majority of our points are redeemed within approximately three years of the date of issuance.


Note 3—Long-term Debt, Short-term Borrowings and Finance Lease Obligations
During the three months ended March 31, 2022, we made principal payments of $83 million on our outstanding debt and finance lease obligations.
We had pledged aircraft, engines, other equipment, and facilities with a net book value of $5.6 billion at March 31, 2022 as security under various financing arrangements.

12

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

At March 31, 2022, scheduled maturities of our long-term debt and finance lease obligations were $267 million for the remainder of 2022, $557 million in 2023, $332 million in 2024, $192 million in 2025, $929 million in 2026, and $1.6 billion thereafter.
The carrying amounts and estimated fair values of our long-term debt, net of debt acquisition costs, at March 31, 2022 and December 31, 2021 were as follows (in millions):
March 31, 2022December 31, 2021
Carrying Value
Estimated Fair Value(2)
Carrying Value
Estimated Fair Value(2)
Public Debt
Fixed rate special facility bonds, due through 2036$42 $44 $42 $45 
Fixed rate enhanced equipment notes:
  2019-1 Series AA, due through 2032532 398 532 442 
  2019-1 Series A, due through 2028166 141 166 150 
2019-1 Series B, due through 202795 113 94 121 
2020-1 Series A, due through 2032587 566 587 634 
2020-1 Series B, due through 2028153 183 153 199 
Non-Public Debt
Fixed rate enhanced equipment notes, due through 202366 65 88 88 
Fixed rate equipment notes, due through 2028575 519 620 706 
Floating rate equipment notes, due through 202889 83 103 99 
2020 sale-leaseback transactions, due through 2024346 358 347 374 
Unsecured CARES Act Payroll Support Program loan, due through 2030259 188 259 219 
Unsecured Consolidated Appropriations Act Payroll Support Program Extension loan, due through 2031144 104 144 121 
Unsecured American Rescue Plan Act of 2021 Payroll Support loan, due through 2031132 95 132 111 
0.50% convertible senior notes due 2026
737 628 736 673 
Total(1)
$3,923 $3,485 $4,003 $3,982 
(1) Total excludes finance lease obligations of $3 million and $3 million at March 31, 2022 and December 31, 2021, respectively.
(2) The estimated fair values of our publicly held long-term debt are classified as Level 2 in the fair value hierarchy. The fair value of our non-public debt are estimated using a discounted cash flow analysis based on our borrowing rates for instruments with similar terms and therefore classified as Level 3 in the fair value hierarchy. Refer to Note 7 to our condensed consolidated financial statements for an explanation of the fair value hierarchy structure.
We have financed certain aircraft with Enhanced Equipment Trust Certificates, or EETCs. One of the benefits of this structure is being able to finance several aircraft at one time, rather than individually. The structure of EETC financing is that we create pass-through trusts in order to issue pass-through certificates. The proceeds from the issuance of these certificates are then used to purchase equipment notes, which are issued by us and are secured by our aircraft. These trusts meet the definition of a variable interest entity, or VIE, as defined in Topic 810, Consolidation of the FASB Codification, and must be considered for consolidation in our financial statements. Our assessment of our EETCs considers both quantitative and qualitative factors including the purpose for which these trusts were established and the nature of the risks in each. The main purpose of the trust structure is to enhance the credit worthiness of our debt obligation through certain bankruptcy protection provisions and liquidity facilities, and also to lower our total borrowing cost. We concluded that we are not the primary beneficiary in these trusts because our involvement in them is limited to principal and interest payments on the related notes, the trusts were not set up to pass along variability created by credit risk to us, and the likelihood of our defaulting on the notes. Therefore, we have not consolidated these trusts in our financial statements.


13

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

Federal Payroll Support Programs
As a result of the adverse economic impact of COVID-19, we have received assistance under various payroll support programs provided by the federal government.
CARES Act – Payroll Support Program
On March 27, 2020, Congress passed the Coronavirus Aid, Relief, and Economic Security Act (the "CARES Act"). Under the CARES Act, assistance was made available to the aviation industry in the form of direct payroll support (the "Payroll Support Program") and secured loans (the "Loan Program").
On April 23, 2020, we entered into a Payroll Support Program Agreement (the "PSP Agreement") under the CARES Act with the United States Department of the Treasury ("Treasury") governing our participation in the Payroll Support Program. Under the Payroll Support Program, Treasury provided us with a total of approximately $963 million (the "Payroll Support Payments") consisting of $704 million in grants and $259 million in unsecured term loans. The loans have a 10-year term and bear interest on the principal amount outstanding at an annual rate of 1.00% until April 23, 2025, and the applicable Secured Overnight Financing Rate ("SOFR") plus 2.00% thereafter until April 23, 2030. The principal amount may be repaid at any time prior to maturity at par. As part of the agreement, JetBlue issued to Treasury warrants to acquire more than 2.7 million shares of our common stock under the program at an exercise price of $9.50 per share.
Consolidated Appropriations Act – Payroll Support Program 2
On January 15, 2021, we entered into a Payroll Support Program Extension Agreement (the "PSP Extension Agreement") with Treasury governing our participation in the federal Payroll Support Program for passenger air carriers under the United States Consolidated Appropriations Act, 2021 (the “Payroll Support Program 2"). Treasury provided us with a total of approximately $580 million (the "Payroll Support 2 Payments") under the program, consisting of $436 million in grants and $144 million in unsecured term loans, with funding received on January 15, 2021, March 5, 2021 and April 29, 2021. The loans have a 10-year term and bear interest on the principal amount outstanding at an annual rate of 1.00% until January 15, 2026, and the applicable SOFR plus 2.00% thereafter until January 15, 2031. In consideration for the Payroll Support 2 Payments, we issued warrants to purchase approximately 1.0 million shares of our common stock to Treasury at an exercise price of $14.43 per share.
American Rescue Plan Act – Payroll Support Program 3
On May 6, 2021, we entered into a Payroll Support 3 Agreement (the "PSP3 Agreement") with Treasury governing our participation in the federal payroll support program for passenger air carriers under Section 7301 of the American Rescue Plan Act of 2021 (the "Payroll Support Program 3"). Treasury provided us with a total of approximately $541 million (the "Payroll Support 3 Payments") under the program, consisting of $409 million in grants and $132 million in unsecured term loans. The loans have a 10-year term and bear interest on the principal amount outstanding at an annual rate of 1.00% until May 6, 2026, and the applicable SOFR plus 2.00% thereafter until May 6, 2031. In consideration for the Payroll Support 3 Payments, we issued warrants to purchase approximately 0.7 million shares of our common stock to Treasury at an exercise price of $19.90 per share.
The warrants associated with each of the payroll support programs described above will expire 5 years after issuance and will be exercisable either through net cash settlement or net share settlement, at our option, in whole or in part at any time.
The carrying values relating to the payroll support grants were recorded within other accrued liabilities and were recognized as a contra-expense within special items on our consolidated statements of operations as the funds were utilized. The relative fair value of the warrants were recorded within additional paid-in capital and reduced the total carrying value of the grants. Proceeds from the payroll support grants and from the issuance of payroll support warrants were classified within operating activities and financing activities, respectively, on our condensed consolidated statements of cash flows. Our funding from all payroll support grants has been fully utilized since September 30, 2021.
The carrying values relating to the unsecured payroll support loans were recorded within long-term debt and finance lease obligations on our consolidated balance sheets. The proceeds from the loans were classified as financing activities on our condensed consolidated statement of cash flows.
CARES Act – Secured Loan Program
Under the CARES Act Loan Program, JetBlue had the ability to borrow up to a total of approximately $1.9 billion from Treasury. We entered into a loan and guarantee agreement (the "Loan Agreement") with Treasury and made an initial drawing

14

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

of $115 million under the CARES Act Loan Program on September 29, 2020. In connection with this initial drawing, we entered into a warrant agreement with Treasury, pursuant to which we issued to Treasury warrants to purchase approximately 1.2 million shares of our common stock at an exercise price of $9.50 per share. The warrants will expire five years after issuance and will be exercisable either through net cash settlement or net share settlement, at our option, in whole or in part at any time.
On September 15, 2021, the Company repaid the full amount of outstanding borrowings under the Loan Agreement, which, together with accrued interest and fees, totaled approximately $118 million. As of March 31, 2022, we did not have a balance outstanding and all obligations under the Loan Agreement, including all pledges of collateral, were terminated in full.
0.50% Convertible Senior Notes due 2026
In March 2021, we completed a private offering for $750 million of 0.50% convertible notes due 2026. The notes are general unsecured senior obligations and will rank equal in right of payment with all of our existing and future senior unsecured indebtedness and senior in right of payment to our existing and future subordinated debt. The notes will effectively rank junior in right of payment to any of our existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness and are structurally subordinated to all of our indebtedness and other liabilities. The net proceeds from this offering were approximately $734 million.
Holders of the notes may convert them into shares of our common stock prior to January 1, 2026 only under certain circumstances (such as upon the satisfaction of the sale price condition, the satisfaction of the trading price condition, notice of redemption, or specified corporate events) and thereafter at any time at a rate of 38.5802 shares of common stock per $1,000 principal amount of notes, which corresponds to an initial conversion price of approximately $25.92 per share. The conversion rate is subject to adjustment upon the occurrence of certain specified events, including, but not limited to, the issuance of certain stock dividends on common stock, the issuance of certain rights or warrants, subdivisions, combinations, distributions of capital stock, indebtedness or assets, cash dividends and certain issuer tender or exchange offers.
Upon conversion, the notes will be settled in cash up to the aggregate principal amount of the notes to be converted and, at our election, in shares of our common stock, cash or a combination of cash and shares of our common stock in respect of the remainder, if any, of our conversion obligation.
We are not required to redeem or retire the notes periodically. We may, at our option, redeem any of the notes for cash at a redemption price of 100% of their principal amount, plus accrued and unpaid interest at any time on or after April 1, 2024 if the last reported sale price of our common stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive), including the trading day immediately preceding the date on which we provide notice of redemption, during any 30 consecutive trading day period ending on, and including, the trading day immediately preceding the date on which we provide a notice of redemption to the holders.
We evaluated the conversion feature of this note offering for embedded derivative in accordance with Topic 815, Derivatives and Hedging of the FASB Codification, and the substantial premium model in accordance with Topic 470, Debt of the FASB Codification. Based on our assessment, separate accounting for the conversion feature of this note offering is not required.
Interest expense recognized during the three months ended March 31, 2022 was $2 million, which included $1 million in amortization of debt issuance costs. Interest expense recognized during the three months ended March 31, 2021 was insignificant.
Short-term Borrowings
Citibank Line of Credit
We have a revolving Credit and Guaranty Agreement with Citibank N.A. as the administrative agent, for up to $550 million. The term of the facility runs through August 2023. Borrowings under the Credit and Guaranty Agreement bear interest at a variable rate equal to LIBOR, plus a margin. The Credit and Guaranty Agreement are secured by unencumbered aircraft, simulators, and certain other assets. The Credit and Guaranty Agreement includes covenants that require us to maintain certain minimum balances in unrestricted cash, cash equivalents, and unused commitments available under revolving credit facilities. In addition, the covenants restrict our ability to, among other things, dispose of certain collateral, or merge, consolidate, or sell assets. As of and for the periods ended March 31, 2022 and December 31, 2021, we did not have a balance outstanding or any borrowings under this line of credit.


15

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

Morgan Stanley Line of Credit
We have a revolving line of credit with Morgan Stanley for up to approximately $200 million. This line of credit is secured by a portion of our investment securities held by Morgan Stanley and the amount available to us under this line of credit may vary accordingly. This line of credit bears interest at a floating rate based upon LIBOR, plus a margin. As of and for the periods ended March 31, 2022 and December 31, 2021, we did not have a balance outstanding or any borrowings under this line of credit.

Note 4—Loss Per Share
Basic earnings per share is calculated by dividing net (loss) income by the weighted average number of shares outstanding during the period. Diluted earnings per share is calculated similarly but includes potential dilution from restricted stock units, the Crewmember Stock Purchase Plan, convertible notes, and any other potentially dilutive instruments using the treasury stock and if-converted methods. Anti-dilutive common stock equivalents excluded from the computation of diluted earnings per share amounts were 2.9 million and 3.5 million for the three months ended March 31, 2022 and 2021, respectively.
The following table shows how we computed loss per common share for the three months ended March 31, 2022 and 2021 (dollars and share data in millions):
Three Months Ended March 31,
 20222021
Net loss$(255)$(247)
Weighted average basic shares320.5 316.3 
Effect of dilutive securities  
Weighted average diluted shares320.5 316.3 
Loss per common share
Basic$(0.79)$(0.78)
Diluted$(0.79)$(0.78)

Note 5—Crewmember Retirement Plan
We sponsor a retirement savings 401(k) defined contribution plan, or the Plan, covering all of our crewmembers where we match 100% of our crewmember contributions up to 5% of their eligible wages. The contributions vest over three years and are measured from a crewmember's hire date. Crewmembers are immediately vested in their voluntary contributions.
Another component of the Plan is a Company discretionary contribution of 5% of eligible non-management crewmember compensation, which we refer to as Retirement Plus. Retirement Plus contributions vest over three years and are measured from a crewmember's hire date.
Certain Federal Aviation Administration, or FAA, licensed crewmembers receive an additional contribution of 3% of eligible compensation, which we refer to as Retirement Advantage.
Our pilots receive a non-elective Company contribution of 16% of eligible pilot compensation per the terms of the finalized collective bargaining agreement between JetBlue and the Air Line Pilots Association ("ALPA"), in lieu of the above 401(k) Company matching contribution, Retirement Plus, and Retirement Advantage contributions. The Company's non-elective contribution of eligible pilot compensation vests after three years of service.
Our non-management crewmembers are eligible to receive profit sharing, calculated as 10% of adjusted pre-tax income before profit sharing and special items up to a pre-tax margin of 18% with the result reduced by Retirement Plus contributions and the equivalent of Retirement Plus contributions for pilots. If JetBlue's resulting pre-tax margin exceeds 18%, non-management crewmembers will receive 20% profit sharing on amounts above an 18% pre-tax margin.

16

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

Total 401(k) company match, Retirement Plus, Retirement Advantage, pilot retirement contribution, and profit sharing expensed for the three months ended March 31, 2022 and 2021 was $62 million and $48 million, respectively.

Note 6—Commitments and Contingencies
Flight Equipment Commitments
In February 2022, we exercised our option to purchase 30 additional Airbus A220-300 aircraft under our existing agreement with Airbus Canada Limited Partnership. The 30 additional A220-300 aircraft are expected to be delivered from 2022 to 2026. Options for 20 additional A220-300 aircraft remain available to us.
As of March 31, 2022, our firm aircraft orders consisted of 64 Airbus A321neo aircraft and 92 Airbus A220 aircraft, scheduled for delivery through 2027. Committed expenditures for these aircraft and related flight equipment, including estimated amounts for contractual price escalations and predelivery deposits as of March 31, 2022 is approximately $0.7 billion for the remainder of 2022, $1.6 billion in 2023, $2.0 billion in 2024, $1.7 billion in 2025, $1.4 billion in 2026, and $1.0 billion thereafter.
The amount of committed expenditures stated above represents the current delivery schedule set forth in our Airbus order book as of March 31, 2022. In February 2022, we received notice from Airbus of anticipated delivery delays for the A220 aircraft. We expect a delivery of a maximum of nine A220 aircraft in 2022 as a result of the delays.
In October 2019, the Office of the U.S. Trade Representative announced a 10% tariff on new commercial aircraft and related parts imported from certain European Union member states, which include aircraft and other parts we are already contractually obligated to purchase, including those noted above. The U.S. Trade Representative increased the tariff to 15% effective March 2020. In March 2021, the U.S. Trade Representative announced a four-month suspension of the tariff that was followed by an announcement in June 2021 that the suspension will be extended for five years. We continue to work with our business partners, including Airbus, to evaluate the potential financial and operational impact of these announcements on our future aircraft deliveries, including after the suspension is lifted. The imposition of this or any tariff could substantially increase the cost of new aircraft and parts.
Other Commitments
We utilize several credit card processors to process our ticket sales. Our agreements with these processors do not contain covenants, but do generally allow the processor to withhold cash reserves to protect the processor from potential liability for tickets purchased, but not yet used for travel. While we currently do not have any collateral requirements related to our credit card processors, we may be required to issue collateral to our credit card processors, or other key business partners, in the future.
As of March 31, 2022, we had approximately $32 million in assets serving as collateral for letters of credit relating to a certain number of our leases. These are included in restricted cash and expire at the end of the related lease terms. Additionally, we had approximately $26 million pledged related to our workers' compensation insurance policies and other business partner agreements, which will expire according to the terms of the related policies or agreements.
Except for our pilots and inflight crewmembers who are represented by the Air Line Pilots Association ("ALPA") and the Transport Workers Union of America ("TWU"), respectively, our other frontline crewmembers do not have third party representation.
In April 2021, ALPA, on behalf of the JetBlue pilot group, filed a grievance relating to the Northeast Alliance Agreement ("NEA"), an expanded codeshare and marketing alliance between JetBlue and American Airlines, Inc. ("American") at four Northeast airports. ALPA claims that in entering the NEA, JetBlue violated certain scope clauses as contained in the pilots’ ALPA collective bargaining agreement. A final mediation session concluded in September 2021 and in January 2022, the parties submitted final written briefs to the System Board. Shortly after submission of the briefs, the parties agreed to enter into non-binding mediation with the assistance of the arbitrator with a temporary hold on a System Board decision. As a result of the mediation process, the parties agreed to certain changes to the collective bargaining agreement. The agreement, ratified by the JetBlue pilot group in April 2022, included a one-time payment of $30 million to be paid and recorded as expense in the second quarter of 2022 and a 3% base pay increase effective May 1, 2022.

17

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

We enter into individual employment agreements with each of our non-unionized FAA-licensed crewmembers, which include dispatchers, technicians, and inspectors, as well as air traffic controllers. Each employment agreement is for a term of five years and automatically renews for an additional five years unless either the crewmember or we elect not to renew it by giving at least 90 days' notice before the end of the relevant term. Pursuant to these agreements, these crewmembers can only be terminated for cause. In the event of a downturn in our business that would require a reduction in work hours, we are obligated to pay these crewmembers a guaranteed level of income and to continue their benefits if they do not obtain other aviation employment.
Legal Matters
Occasionally, we are involved in various claims, lawsuits, regulatory examinations, investigations and other legal matters involving suppliers, crewmembers, customers, and governmental agencies, arising, for the most part, in the ordinary course of business. The outcome of litigation and other legal matters is always uncertain. The Company believes it has valid defenses to the legal matters currently pending against it, is defending itself vigorously, and has recorded accruals determined in accordance with GAAP, where appropriate. In making a determination regarding accruals, using available information, we evaluate the likelihood of an unfavorable outcome in legal or regulatory proceedings to which we are a party and record a loss contingency when it is probable a liability has been incurred and the amount of the loss can be reasonably estimated. These subjective determinations are based on the status of such legal or regulatory proceedings, the merits of our defenses, and consultation with legal counsel. Actual outcomes of these legal and regulatory proceedings may materially differ from our current estimates. It is possible that resolution of one or more of the legal matters currently pending or threatened could result in losses material to our consolidated results of operations, liquidity, or financial condition.
To date, none of these types of litigation matters, most of which are typically covered by insurance, has had a material impact on our operations or financial condition. We have insured and continue to insure against most of these types of claims. A judgment on any claim not covered by, or in excess of, our insurance coverage could materially adversely affect our consolidated results of operations, liquidity, or financial condition.
On September 21, 2021, the United States Department of Justice (the "DOJ"), along with the Attorneys General of each of the States of Arizona, California, and Florida, the Commonwealths of Massachusetts, Pennsylvania, and Virginia, and the District of Columbia, filed a lawsuit in the United States District Court for the District of Massachusetts against JetBlue and American, and, together with JetBlue, the “Carriers” concerning the Carriers’ previously implemented NEA. The lawsuit asserts and seeks an adjudication that the NEA violates Section 1 of the Sherman Act, and that the Carriers be permanently enjoined from continuing and restrained from further implementing the NEA.
Also on September 21, 2021, the Department of Transportation (the "DOT") published a Clarification Notice relating to the agreement that had been reached between the DOT, JetBlue, and American in January 2021, at the conclusion of the DOT’s review of the NEA ("DOT Agreement"). The DOT Clarification Notice stated, among other things, that the DOT Agreement remains in force during the pendency of the DOJ action against the NEA and, while the DOT retains independent statutory authority to prohibit unfair methods of competition in air transportation, the DOT intends to defer to DOJ to resolve the antitrust concerns that the DOJ has identified with respect to the NEA. The DOT simultaneously published a Notice Staying Proceeding in relation to a complaint by Spirit Airlines, Inc. regarding the NEA, pending resolution of the DOJ action described above.
JetBlue believes the lawsuit is without merit and, along with American, intends to defend itself vigorously. Given the nature of this case, we are unable to estimate the reasonably possible loss or range of loss, if any, arising from this matter. In November 2021, JetBlue and American filed a motion to dismiss the DOJ's lawsuit against the NEA. Motion practice has concluded and the parties await a decision, while the lawsuit proceeds concurrently.

Note 7—Fair Value
Under Topic 820, Fair Value Measurement of the FASB Codification disclosures are required about how fair value is determined for assets and liabilities and a hierarchy for which these assets and liabilities must be grouped is established, based on significant levels of inputs as follows:

18

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

Level 1 - observable inputs such as unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2 - quoted prices in active markets for similar assets and liabilities, and other inputs that are observable directly or indirectly for the asset or liability; or
Level 3 - unobservable inputs for the asset or liability, such as discounted cash flow models or valuations.
The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
The following is a listing of our assets and liabilities required to be measured at fair value on a recurring basis and where they are classified within the fair value hierarchy as of March 31, 2022 and December 31, 2021 (in millions):
March 31, 2022
Level 1Level 2Level 3Total
Assets
Cash equivalents$1,128 $15 $ $1,143 
Available-for-sale investment securities 936  936 
Equity investment securities24   24 
December 31, 2021
Level 1Level 2Level 3Total
Assets
Cash equivalents$1,515 $ $ $1,515 
Available-for-sale investment securities 800  800 
Equity investment securities26   26 
Refer to Note 3 to our condensed consolidated financial statements for fair value information related to our outstanding debt obligations as of March 31, 2022 and December 31, 2021.
Cash equivalents
Our cash equivalents include money market securities and time deposits which are readily convertible into cash, have maturities of three months or less when purchased, and are considered to be highly liquid and easily tradable. The money market securities are valued using inputs observable in active markets for identical securities and are therefore classified as Level 1 within our fair value hierarchy. The fair values of remaining instruments are based on observable inputs in non-active markets, which are therefore classified as Level 2 in the hierarchy.
Available-for-sale investment securities
Our available-for-sale investment securities include investments such as time deposits and convertible debt securities. The fair values of these instruments are based on observable inputs in non-active markets, which are therefore classified as Level 2 in the hierarchy. We did not record any material gains or losses on these instruments during the three months ended March 31, 2022 and 2021.
Equity investment securities
Our equity investment securities include investments in common stocks of publicly traded companies. The fair values of these instruments are classified as Level 1 in the hierarchy as they are based on unadjusted quoted prices in active markets for identical assets. We recognized a net unrealized loss of $2 million on these securities during the three months ended March 31, 2022. No gains or losses were recorded during the same period in 2021.
Other Investments

19

PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

As discussed in Note 1 to our condensed consolidated financial statement, JTV has equity investments in emerging companies that do not have readily determinable fair values. In accordance with Topic 321, Investments - Equity Securities of the FASB Codification, we account for these investments using a measurement alternative which allows entities to measure these investments at cost, less any impairment, adjusted for changes from observable price changes in orderly transactions for identifiable or similar investments of the same issuer. We did not record any material gains or losses on these investments during the three months ended March 31, 2022 and 2021.

Note 8—Accumulated Other Comprehensive Income (Loss)
Comprehensive income (loss) includes changes in fair value of our available-for-sale securities. A rollforward of the amounts included in accumulated other comprehensive income (loss), net of taxes for the three months ended March 31, 2022 and 2021 is as follows (in millions):
Available-for-sale securities(1)
Total
Balance of accumulated income, at December 31, 2021$ $ 
Reclassifications into earnings, net of deferred taxes of $0
  
Change in fair value, net of deferred taxes of $0
(1)(1)
Balance of accumulated (loss), at March 31, 2022$(1)$(1)
Balance of accumulated income, at December 31, 2020$ $ 
Reclassifications into earnings, net of deferred taxes $0
  
Change in fair value, net of deferred taxes of $0
  
Balance of accumulated income, at March 31, 2021$ $ 
(1) Reclassified to interest income.

Note 9—Special Items
The following is a listing of special items presented on our consolidated statements of operations for the three months ended March 31, 2022 and 2021 (in millions):
Three Months Ended March 31,
20222021
Special Items
Federal payroll support grant recognition(1)
$ $(288)
CARES Act employee retention credit(2)
 (1)
Total$ $(289)
(1) As discussed in Note 3 to our condensed consolidated financial statements, we received assistance in the form of grants and unsecured loans under various federal payroll support programs. Funds under these federal payroll support programs were to be used exclusively for the continuation of payment of crewmember wages, salaries and benefits. The carrying values of the payroll support grants (after consideration of the warrants we issued) were recorded within other liabilities and were recognized as contra-expenses within special items on our consolidated statements of operations as the funds were utilized. We utilized $288 million of payroll support grants for the three months ended March 31, 2021. Our payroll support grants were fully utilized as of December 31, 2021.
(2) The Employee Retention Credit ("ERC") under the CARES Act is a refundable tax credit which encourages business to keep employees on the payroll during the COVID-19 pandemic. Eligible employers can qualify for up to $5,000 of credit for each employee based on qualified wages paid after March 12, 2020 and before January 1, 2021. The Internal Revenue Service ("IRS") subsequently issued Notice 2021-23 and Notice 2021-49 which collectively extended the ERC eligibility to cover qualified wages paid after December 31, 2020 and before January 1, 2022. Qualified wages are the wages paid to an employee

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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

for the time that the employee is not providing services due to an economic hardship, specifically, either (1) a full or partial suspension of operations by order of a governmental authority due to COVID-19, or (2) a significant decline in gross receipts. Our policy is to recognize the ERC when it is filed with the IRS. We recognized $1 million of ERC as a contra-expense within special items on our consolidated statements of operations for the three months ended March 31, 2021.

Note 10—Subsequent Event
Proposal to Acquire Spirit Airlines
On April 5 2022, we announced that we have delivered to the board of directors of Spirit Airlines, Inc. ("Spirit") a proposal to acquire all of the outstanding shares of Spirit common stock for a per share consideration of $33.00 in cash.
We intend to fund the transaction with cash on hand and debt financing.
Any transaction with Spirit would be subject to negotiation and execution of, among other agreements, a definitive merger agreement between JetBlue and Spirit which would be subject to approval by each company’s Board of Directors. Completion of the transaction would be subject to customary closing conditions, including receipt of required regulatory approvals and approval of Spirit’s shareholders.

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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
OVERVIEW
The COVID-19 pandemic continued to have an adverse impact on our business and operating results in the first quarter of 2022. We have seen continued improvements in our business during the first quarter, which we expect to continue throughout 2022.
First Quarter 2022 Results
Our operating results in the first quarter of 2021 and 2020 were adversely impacted by the COVID-19 pandemic. As a result, comparisons of our year-over-year performance are inflated and would not necessarily be indicative of our future operating results. In certain cases, we have also provided comparisons of our first quarter 2022 results to our first quarter 2019 results, which are more reflective of pre-pandemic operations, allowing for a better understanding of the full impact of the COVID-19 pandemic and the progress of our recovery.
First quarter system capacity increased by 69.2% year-over-year and decreased by 0.3% compared to the first quarter of 2019.
Revenue for the first quarter of 2022 increased by 137.0%, or $1.0 billion year-over-year, to $1.7 billion. Compared to the first quarter of 2019, revenue decreased by 7.2%, or $135 million.
Operating revenue per available seat mile ("RASM") for the first quarter of 2022 increased by 40.0% year-over-year to 11.29 cents. This compares to a decrease of 6.9% from the first quarter of 2019.
Operating expense for the first quarter of 2022 increased by 104.8% year-over-year to $2.1 billion. Compared to the first quarter of 2019, operating expense increased by 17.1%, or $308 million.
Operating expense per available seat mile ("CASM") for the first quarter of 2022 increased by 21.0% year-over-year to 13.67 cents. This compares to an increase of 17.5% from the first quarter of 2019.
Our operating expense for the first quarter of 2021 and 2019 included the effects of special items. Excluding fuel and related taxes, special items, as well as operating expenses related to our non-airline businesses, our operating expense(1) increased by 36.3% to $1.5 billion year-over-year. This compares to an increase of 13.5% from the first quarter of 2019. Refer to our ''Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for details of the special items.
Excluding fuel and related taxes, special items, as well as operating expenses related to our non-airline businesses, our cost per available seat mile ("CASM ex-fuel")(1) decreased by 19.4% year-over-year to 9.87 cents for the first quarter of 2022. This compares to an increase of 13.9% from the first quarter of 2019.
Our reported (loss) earnings per share for the first quarter of 2022, 2021, and 2019 were $(0.79), $(0.78), and $0.14, respectively. Excluding mark-to-market and certain gains and losses on our investments, our adjusted loss per share(1) for the first quarter of 2022 was $(0.80). Excluding special items, our adjusted (loss) earnings per share(1) for the first quarter of 2021 and 2019 were $(1.48) and $0.16, respectively.
Network
Enabled by our NEA with American, we added three new destinations to our network in the first quarter of 2022.
DestinationService Commenced
Puerto Vallarta, Mexico
February 19, 2022
Kansas City, MissouriMarch 27, 2022
Milwaukee, WisconsinMarch 27, 2022
We expect to continue diversifying our network as we recover from the pandemic. We have previously announced services to the following new destinations:
DestinationService Expected to Commence
Vancouver, Canada
June 9, 2022
Asheville, North CarolinaJune 16, 2022
(1) Refer to our ''Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Following the success of our inaugural transatlantic service between New York's John F. Kennedy International Airport and London, which began in August 2021, we have announced plans to begin service to London from Boston Logan International Airport this summer.
Fleet
In February 2022, we exercised our option to purchase 30 additional Airbus A220-300 aircraft under our existing agreement with Airbus Canada Limited Partnership. The 30 additional A220-300 aircraft are expected to be delivered from 2022 to 2026. Options for 20 additional A220-300 aircraft remain available to us.
Properties
Reaffirming our commitment to New York, in February 2022, we executed a new lease for our primary corporate offices that will extend our stay in the present Long Island City location until 2039. This new lease contributed $59 million to our total operating lease assets and liabilities balances at March 31, 2022.
Environmental, Social, and Governance ("ESG")
We remain focused on continuing to lead in ESG initiatives. Our efforts include:
In March 2022, the JetBlue Foundation awarded 10 charitable organizations with grants to support and advance their education and mentorship programs. These grants are expected to further the Foundation's mission of increased advocacy for inclusion, gender and racial parity within science, technology, engineering and math education, and aviation.
We expanded our Gateway program to provide a pathway for families of our crewmembers to become pilots through a defined education, training, and time-building program.
We made an investment in Electric Power Systems, a leading provider of aerospace battery systems, through JetBlue Technology Ventures ("JTV"), our wholly owned subsidiary.
In April 2022, JTV announced its investment as a limited partner in TPG Rise Climate, the climate investing strategy of TPG's global impact investing platform TPG Rise, further continuing its commitment to creating a more sustainable travel industry.
In April 2022, we announced the execution of an offtake agreement with Aemetis for 125 million gallons of blended sustainable aviation fuel ("SAF") to be delivered over 10 years beginning in 2025.
Outlook for 2022
We are pleased with the momentum in demand and revenue trends which accelerated throughout the first quarter. We expect revenue for the second quarter of 2022 to increase between 11% to 16 % compared to the same period in 2019, sustained by the underlying momentum.
To alleviate the recent operational challenges, we are further moderating our capacity growth for the remainder of the year. For the second quarter of 2022, we expect capacity to increase between 0% to 3% compared to the same period in 2019. Full year 2022 capacity is expected to increase between 0% to 5% compared to 2019. Our original expectation for full year 2022 capacity was an increase of between 11% to 15% versus 2019. We believe our operational investments and capacity reductions will improve our operational performance in the coming months while we expect to fly a record number of customers. Given our reduced capacity outlook, we are also exploring the potential to accelerate the retirement of some of our older aircraft.
Operating expenses per available seat mile, excluding fuel and related taxes, other non-airline operating expenses, and special items ("CASM Ex-Fuel")(1) for the second quarter of 2022 is expected to increase between 15% to 17%. This increase is primarily attributed to the following factors: certain inefficient, close-in capacity reductions; premium and incentive pay to our frontline crewmembers to support the operation; ramp-up costs to maintain our hiring pace for the summer; and recent changes
(1) Refer to our ''Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
to the collective bargaining agreement with our pilots group. We expect full year 2022 CASM Ex-Fuel to increase between 10% to 15% compared to 2019.
Despite the temporary cost challenges expected in the near term, we expect the Company will return to profitability in the second half of 2022.

(1) Refer to our ''Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Three Months Ended March 31, 2022 vs. 2021
Overview
We reported a net loss of $255 million, an operating loss of $367 million and an operating margin of (21.1)% for the three months ended March 31, 2022. This compares to a net loss of $247 million, an operating loss of $294 million and an operating margin of (40.2)% for the three months ended March 31, 2021. Loss per share was $(0.79) for the three months ended March 31, 2022 compared to $(0.78) for the same period in 2021.
Our reported results for the three months ended March 31, 2022 included mark-to-market and certain gains and losses on our investments. Adjusting for these items, our adjusted net loss(1) was $256 million, and adjusted loss per share(1) was $(0.80) for the three months ended March 31, 2022.
Our reported results for the three months ended March 31, 2021 included the effects of special items. Adjusting for these special items(1), our adjusted net loss(1) was $467 million, adjusted operating loss(1) was $583 million, adjusted operating margin(1) was (79.6)%, and adjusted loss per share(1) was $(1.48) for the three months ended March 31, 2021.
On-time performance, as defined by the Department of Transportation ("DOT"), is arrival within 14 minutes of scheduled arrival time. In the first quarter of 2022, our system wide on-time performance was 65.6% compared to 78.9% for the same period in 2021. Our completion factor decreased by 3.0 points to 94.9% in the first quarter of 2022 from 97.9% for the same period in 2021. We experienced operational challenges in the first quarter of 2022 which continued into April.
Operating Revenues
(Revenues in millions; percent changes based on unrounded numbers)Three Months Ended March 31,Year-over-Year Change
20222021$%
Passenger revenue$1,603 $670 $933 139.5 %
Other revenue133 63 70 111.0 
Total operating revenues$1,736 $733 $1,003 137.0 %
Average Fare$195.99 $149.97 $46.02 30.7 %
Yield per passenger mile (cents)14.67 11.52 3.15 27.3 
Passenger revenue per ASM (cents)10.42 7.36 3.06 41.5 
Operating revenue per ASM (cents)11.29 8.06 3.23 40.0 
Average stage length (miles)1,231 1,277 (46)(3.6)
Revenue passengers (thousands)8,177 4,463 3,714 83.2 
Revenue passenger miles (millions)10,927 5,808 5,119 88.1 
Available Seat Miles (ASMs) (millions)15,383 9,090 6,293 69.2 
Load Factor71.0 %63.9 %7.1 pts.
Passenger revenue is our primary source of revenue, which includes seat revenue and baggage fees, as well as revenue from our ancillary product offerings such as Even More® Space. The increase in passenger revenue of $933 million, or 139.5%, for the three months ended March 31, 2022 compared to the same period in 2021, was primarily driven by the return in demand for travel as we continue to recover from the COVID-19 pandemic. Revenue passengers increased by 83.2% to 8.2 million for the three months ended March 31, 2022 from 4.5 million for the same period in 2021.
Other revenue is primarily comprised of the marketing component of the sales of our TrueBlue® points. It also includes revenue from the sale of vacation packages, ground handling fees received from other airlines, and rental income. The increase in other revenue of $70 million, or 111.0%, was principally driven by an increase in marketing revenue associated with our TrueBlue® program due to higher customer spend along with improved metrics from our new co-branded credit card agreements, which became effective in mid-2021.
(1) Refer to our ''Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Our first quarter 2022 results were characterized by a very strong demand acceleration, with revenue coming in more than six points ahead of our original forecast of a decline between 11% and 16% compared to the same period in 2019. Load factors improved meaningfully from an average of 62% in January to 80% in March. We delivered positive year-over-three revenue growth in the month of March as we exited the quarter with tremendous revenue momentum driven by very strong underlying travel demand across our business.
Operating Expenses
In detail, our operating costs per available seat mile, or ASM, were as follows:
(in millions; per ASM data in cents; percent changes based on unrounded numbers)Three Months Ended March 31,Year-over-Year ChangeCents per ASM
20222021$%20222021% Change
Aircraft fuel and related taxes$571 $193 $378 195.0 %3.71 2.13 74.3 %
Salaries, wages and benefits688 521 167 32.0 4.47 5.74 (22.0)
Landing fees and other rents132 115 17 14.8 0.86 1.26 (32.2)
Depreciation and amortization143 125 18 15.1 0.93 1.37 (32.0)
Aircraft rent26 25 4.2 0.17 0.27 (38.4)
Sales and marketing57 23 34 152.9 0.37 0.25 49.4 
Maintenance, materials and repairs152 104 48 45.8 0.99 1.15 (13.8)
Other operating expenses334 210 124 59.2 2.17 2.31 (5.9)
Special items— (289)289 (100.0)— (3.18)(100.0)
Total operating expenses$2,103 $1,027 $1,076 104.8 %13.67 11.30 21.0 %
Total operating expenses excluding special items(1)
$2,103 $1,316 $787 59.8 %13.67 14.48 (5.6)%
Aircraft Fuel and Related Taxes
Aircraft fuel and related taxes increased by $378 million, or 195.0%, for the three months ended March 31, 2022 compared to the same period in 2021. The average fuel price for the three months ended March 31, 2022 increased by 68.4% to $2.90 per gallon. Our fuel consumption increased by 75.2%, or 85 million gallons, due to the increase in capacity as demand for travel returned. Scheduled departures increased to 78,393 flights, or 78.0%, for the three months ended March 31, 2022. Given the significant rise in fuel costs, we moderated our capacity growth for the first quarter of 2022.
Salaries, Wages and Benefits
Salaries, wages and benefits increased by $167 million, or 32.0%, for the three months ended March 31, 2022 compared to the same period in 2021. The increase was driven primarily by higher total hours worked by our crewmembers as we align our workforce with the increased demand for travel. As of March 31, 2022, we have approximately 23,500 crewmembers compared to approximately 20,000 crewmembers at March 31, 2021. The average number of full-time equivalent crewmembers increased by 33.2% compared to the same period in 2021. We expect near-term pressures on salaries, wages and benefits driven by premium and incentive pay to our frontline crewmembers to support the operation, ramp-up costs to maintain our hiring pace for the summer, and recent changes to the collective bargaining agreement with our pilots group.
Landing Fees and Other Rents
Landing fees and other rents increased by $17 million, or 14.8%, for the three months ended March 31, 2022 compared to the same period in 2021 primarily due to increases in departures.
Depreciation and Amortization
Depreciation and amortization increased by $18 million, or 15.1%, for the three months ended March 31, 2022 compared to the same period in 2021 primarily driven by the addition of 16 new aircraft that were placed into service since March 31, 2021. The average number of our operating aircraft increased by 6.0% during the three months ended March 31, 2022 as compared to the same period in 2021.
(1) Refer to our ''Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
26

PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Sales and Marketing
Sales and marketing increased $34 million, or 152.9%, for the three months ended March 31, 2022 compared to the same period in 2021 principally driven by higher credit card fees and computer reservation system charges, which are directly related to return in demand as we continue to recover from the pandemic. Revenue passengers increased by 4 million, or 83.2%, year-over-year.
Materials and Repairs
Maintenance materials and repairs increased $48 million, or 45.8%, for the three months ended March 31, 2022 compared to the same period in 2021, primarily driven by the increase in flying and timing of heavy maintenance visits and engine maintenance.
Other Operating Expenses
Other operating expenses consist of the following categories: outside services (including expenses related to fueling, ground handling, skycap, security, and janitorial services), insurance, personnel expenses, professional fees, onboard supplies, shop and office supplies, bad debts, communication costs, and taxes other than payroll and fuel taxes.
Other operating expenses increased $124 million, or 59.2%, for the three months ended March 31, 2022 compared to the same period in 2021 as we ramped up the level of our operations in response to the return in demand for air travel.
Special Items
Special items for the three months ended March 31, 2021 included the following:
Contra-expense of $288 million, which represents the amount of federal payroll support grants utilized during the period; and
Contra-expenses of $1 million related to the recognition of Employee Retention Credits provided by the CARES Act.
There were no special items for the three months ended March 31, 2022.
Operational Statistics
The following table sets forth our operating statistics for the three months ended March 31, 2022 and 2021:
(1) Refer to our ''Regulation G Reconciliation of Non-GAAP Financial Measures" at the end of this section for more information on this non-GAAP measure.
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PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
<
Three Months Ended March 31,Year-over-Year Change
(percent changes based on unrounded numbers)20222021%
Operational Statistics
Revenue passengers (thousands)8,177 4,463 83.2 
Revenue passenger miles (RPMs) (millions)10,927 5,808 88.1 
Available seat miles (ASMs) (millions)15,383 9,090 69.2 
Load factor71.0 %63.9 %7.1 pts
Aircraft utilization (hours per day)9.9 5.9 67.8 
Average fare$195.99 $149.97 30.7 
Yield per passenger mile (cents)14.67 11.52 27.3 
Passenger revenue per ASM (cents)10.42 7.36 41.5 
Operating revenue per ASM (cents)11.29 8.06 40.0 
Operating expense per ASM (cents)13.67 11.30 21.0 
Operating expense per ASM, excluding fuel(1)
9.87 12.25 (19.4)
Departures78,393 44,049 78.0 
Average stage length (miles)1,231 1,277 (3.6)
Average number of operating aircraft during period282.0 266.0