Company Quick10K Filing
Quick10K
Jetblue Airways
Closing Price ($) Shares Out (MM) Market Cap ($MM)
$18.34 301 $5,520
10-Q 2019-06-30 Quarter: 2019-06-30
10-Q 2019-03-31 Quarter: 2019-03-31
10-K 2018-12-31 Annual: 2018-12-31
10-Q 2018-09-30 Quarter: 2018-09-30
10-Q 2018-06-30 Quarter: 2018-06-30
10-Q 2018-03-31 Quarter: 2018-03-31
10-K 2017-12-31 Annual: 2017-12-31
10-Q 2017-09-30 Quarter: 2017-09-30
10-Q 2017-06-30 Quarter: 2017-06-30
10-Q 2017-03-31 Quarter: 2017-03-31
10-K 2016-12-31 Annual: 2016-12-31
10-Q 2016-09-30 Quarter: 2016-09-30
10-Q 2016-06-30 Quarter: 2016-06-30
10-Q 2016-03-31 Quarter: 2016-03-31
10-K 2015-12-31 Annual: 2015-12-31
10-Q 2015-09-30 Quarter: 2015-09-30
10-Q 2015-06-30 Quarter: 2015-06-30
10-Q 2015-03-31 Quarter: 2015-03-31
10-K 2014-12-31 Annual: 2014-12-31
10-Q 2014-09-30 Quarter: 2014-09-30
10-Q 2014-06-30 Quarter: 2014-06-30
10-Q 2014-03-31 Quarter: 2014-03-31
10-K 2013-12-31 Annual: 2013-12-31
8-K 2019-08-01 Enter Agreement, Off-BS Arrangement
8-K 2019-07-23 Earnings, Regulation FD, Exhibits
8-K 2019-07-16 Officers
8-K 2019-07-15 Officers
8-K 2019-07-11 Regulation FD, Exhibits
8-K 2019-06-13 Regulation FD
8-K 2019-06-12 Regulation FD, Exhibits
8-K 2019-06-04 Officers
8-K 2019-05-16 Shareholder Vote
8-K 2019-05-10 Regulation FD, Exhibits
8-K 2019-04-23 Earnings, Regulation FD, Exhibits
8-K 2019-04-10 Regulation FD, Exhibits
8-K 2019-03-12 Regulation FD, Exhibits
8-K 2019-03-11 Regulation FD
8-K 2019-02-12 Regulation FD, Exhibits
8-K 2019-01-24 Earnings, Regulation FD, Exhibits
8-K 2019-01-24 Earnings, Regulation FD, Exhibits
8-K 2019-01-11 Regulation FD, Exhibits
8-K 2018-12-12 Regulation FD, Exhibits
8-K 2018-11-13 Regulation FD, Exhibits
8-K 2018-10-23 Earnings, Regulation FD, Exhibits
8-K 2018-10-10 Regulation FD, Exhibits
8-K 2018-10-02 Regulation FD, Exhibits
8-K 2018-09-13 Regulation FD, Exhibits
8-K 2018-09-05 Regulation FD
8-K 2018-08-14 Officers
8-K 2018-08-10 Regulation FD, Exhibits
8-K 2018-08-01 Regulation FD
8-K 2018-07-31 Regulation FD, Exhibits
8-K 2018-07-24 Earnings, Regulation FD, Exhibits
8-K 2018-07-12 Regulation FD, Exhibits
8-K 2018-07-11 Regulation FD, Exhibits
8-K 2018-07-07 Regulation FD, Exhibits
8-K 2018-06-12 Regulation FD, Exhibits
8-K 2018-05-24 Regulation FD
8-K 2018-05-17 Officers, Shareholder Vote, Regulation FD, Exhibits
8-K 2018-05-10 Regulation FD, Exhibits
8-K 2018-04-24 Earnings, Regulation FD, Exhibits
8-K 2018-04-13 Regulation FD, Exhibits
8-K 2018-04-11 Regulation FD, Exhibits
8-K 2018-03-30 Enter Agreement
8-K 2018-03-12 Regulation FD, Exhibits
8-K 2018-03-01 Regulation FD
8-K 2018-01-25 Earnings, Regulation FD, Exhibits
8-K 2018-01-11 Regulation FD, Exhibits
8-K 2018-01-08 Amend Bylaw, Exhibits
TM Toyota Motor 168,980
AME Ametek 19,470
ENLC EnLink Midstream 5,210
XELA Exela Technologies 507
RCUS Arcus Biosciences 490
GCBC Greene County Bancorp 261
RNGR Ranger Energy Services 121
ATV Acorn 72
DSS Document Security Systems 20
JGRI Joshua Gold Resources 0
JBLU 2019-06-30
Part I. Financial Information
Item 1. Financial Statements
Note 1-Summary of Significant Accounting Policies
Part I. Financial Information
Item 1. Financial Statements
Note 2- Revenue Recognition
Part I. Financial Information
Item 1. Financial Statements
Note 3-Long-Term Debt, Short-Term Borrowings, and Finance Lease Obligations
Part I. Financial Information
Item 1. Financial Statements
Note 4-Leases
Part I. Financial Information
Item 1. Financial Statements
Note 5-Earnings per Share
Note 6-Crewmember Retirement Plan
Part I. Financial Information
Item 1. Financial Statements
Note 7-Commitments and Contingencies
Part I. Financial Information
Item 1. Financial Statements
Note 8-Financial Derivative Instruments and Risk Management
Part I. Financial Information
Item 1. Financial Statements
Note 9-Fair Value
Part I. Financial Information
Item 1. Financial Statements
Note 10-Accumulated Other Comprehensive Income (Loss)
Part I. Financial Information
Item 1. Financial Statements
Note 11-Special Items
Part I. Financial Information
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II. Financial Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 6. Exhibits
EX-10.1 q22019exhibit101.htm
EX-10.2 q22019exhibit102.htm
EX-31.1 q22019exhibit311.htm
EX-31.2 q22019exhibit312.htm
EX-32 q22019exhibit32.htm

Jetblue Airways Earnings 2019-06-30

JBLU 10Q Quarterly Report

Balance SheetIncome StatementCash Flow

Document
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Table of Contents

 
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 June 30, 2019
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
jetbluelogoa07.jpg
JETBLUE AIRWAYS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware
 
 
87-0617894
(State of Other Jurisdiction of Incorporation)
 
 
(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 class
Trading Symbol
Name of each exchange on which registered
Common Stock, $0.01 par value
JBLU
The 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 June 30, 2019, there were 296,266,931 shares outstanding of the registrant’s common stock, par value $0.01.
 


Table of Contents

JETBLUE AIRWAYS CORPORATION
FORM 10-Q
INDEX
 
Page
PART I. FINANCIAL INFORMATION
 
 
 
PART II. OTHER INFORMATION
 



2

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



 
June 30, 2019
 
December 31, 2018
ASSETS
 
 
 
CURRENT ASSETS
 
 
 
Cash and cash equivalents
$
461

 
$
474

Investment securities
448

 
413

Receivables, less allowance (2019-$2; 2018-$1)
282

 
211

Inventories, less allowance (2019-$20; 2018-$18)
85

 
78

Prepaid expenses and other
193

 
212

Total current assets
1,469

 
1,388

PROPERTY AND EQUIPMENT
 
 
 
Flight equipment
9,814

 
9,525

Predelivery deposits for flight equipment
408

 
293

Total flight equipment and predelivery deposits, gross
10,222

 
9,818

Less accumulated depreciation
2,609

 
2,448

Total flight equipment and predelivery deposits, net
7,613

 
7,370

Other property and equipment
1,102

 
1,074

Less accumulated depreciation
494

 
461

Total other property and equipment, net
608

 
613

Total property and equipment
8,221

 
7,983

OPERATING LEASE ASSETS
998

 
1,056

OTHER ASSETS
 
 
 
Investment securities
4

 
3

Restricted cash
61

 
59

Other
483

 
470

Total other assets
548

 
532

TOTAL ASSETS
$
11,236

 
$
10,959

 
 
 
 
 

See accompanying notes to condensed consolidated financial statements.
3

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

 
June 30, 2019
 
December 31, 2018
LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
CURRENT LIABILITIES
 
 
 
Accounts payable
$
504

 
$
437

Air traffic liability
1,290

 
1,035

Accrued salaries, wages and benefits
335

 
313

Other accrued liabilities
352

 
298

Current operating lease liabilities
133

 
133

Current maturities of long-term debt and finance leases
275

 
309

Total current liabilities
2,889

 
2,525

LONG-TERM DEBT AND FINANCE LEASE OBLIGATIONS
1,217

 
1,361

LONG-TERM OPERATING LEASE LIABILITIES
753

 
798

DEFERRED TAXES AND OTHER LIABILITIES
 
 
 
Deferred income taxes
1,158

 
1,112

Air traffic liability - loyalty non-current
470

 
447

Other
52

 
31

Total deferred taxes and other liabilities
1,680

 
1,590

COMMITMENTS AND CONTINGENCIES (Note 7)
 
 
 
STOCKHOLDERS’ EQUITY
 
 
 
Preferred stock, $0.01 par value; 25 shares authorized, none issued

 

Common stock, $0.01 par value; 900 shares authorized, 425 and 422 shares issued and 296 and 306 shares outstanding at June 30, 2019 and December 31, 2018, respectively
4

 
4

Treasury stock, at cost; 129 and 116 shares at June 30, 2019 and December 31, 2018, respectively
(1,503
)
 
(1,272
)
Additional paid-in capital
2,221

 
2,203

Retained earnings
3,974

 
3,753

Accumulated other comprehensive income (loss)
1

 
(3
)
Total stockholders’ equity
4,697

 
4,685

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
11,236

 
$
10,959




See accompanying notes to condensed consolidated financial statements.
4

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


 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019

2018
 
2019
 
2018
OPERATING REVENUES
 
 
 
 
 
 
 
Passenger
$
2,031

 
$
1,858

 
$
3,833

 
$
3,549

Other
74

 
70

 
144

 
133

Total operating revenues
2,105

 
1,928

 
3,977

 
3,682

OPERATING EXPENSES
 
 
 
 
 
 
 
Aircraft fuel and related taxes
484

 
491

 
921

 
908

Salaries, wages and benefits
576

 
486

 
1,151

 
985

Landing fees and other rents
121

 
122

 
237

 
230

Depreciation and amortization
127

 
114

 
251

 
226

Aircraft rent
25

 
24

 
50

 
48

Sales and marketing
75

 
75

 
141

 
142

Maintenance materials and repairs
168

 
188

 
324

 
329

Other operating expenses
277

 
261

 
563

 
522

Special items
2

 
319

 
14

 
319

Total operating expenses
1,855

 
2,080

 
3,652

 
3,709

OPERATING INCOME (LOSS)
250

 
(152
)
 
325

 
(27
)
OTHER INCOME (EXPENSE)
 
 
 
 
 
 
 
Interest expense
(19
)
 
(16
)
 
(38
)
 
(32
)
Capitalized interest
3

 
3

 
6

 
5

Interest income and other
2

 
3

 
1

 
5

   Total other income (expense)
(14
)
 
(10
)
 
(31
)
 
(22
)
INCOME (LOSS) BEFORE INCOME TAXES
236

 
(162
)
 
294

 
(49
)
Income tax expense (benefit)
57

 
(41
)
 
73

 
(18
)
NET INCOME (LOSS)
$
179

 
$
(121
)
 
$
221

 
$
(31
)
 
 
 
 
 
 
 
 
EARNINGS PER COMMON SHARE:
 
 
 
 
 
 
 
Basic
$
0.60

 
$
(0.39
)
 
$
0.73

 
$
(0.10
)
Diluted
$
0.59

 
$
(0.39
)
 
$
0.73

 
$
(0.10
)



See accompanying notes to condensed consolidated financial statements.
5

Table of Contents
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited, in millions)

 
Three Months Ended June 30,
 
2019

2018
NET INCOME (LOSS)
$
179

 
$
(121
)
Changes in fair value of derivative instruments, net of reclassifications into earnings (net of tax benefit/(expense) of $1 and $0 in 2019 and 2018, respectively)
2

 

Total other comprehensive income
2

 

COMPREHENSIVE INCOME (LOSS)
$
181

 
$
(121
)
 
 
 
 
 
Six Months Ended June 30,
 
2019
 
2018
NET INCOME (LOSS)
$
221

 
$
(31
)
Changes in fair value of derivative instruments, net of reclassifications into earnings (net of tax benefit/(expense) of $1 and $0 in 2019 and 2018, respectively)
4

 

Total other comprehensive income
4

 

COMPREHENSIVE INCOME (LOSS)
$
225

 
$
(31
)



See accompanying notes to condensed consolidated financial statements.
6

Table of Contents
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in millions)

 
Six Months Ended June 30,
 
2019

2018
CASH FLOWS FROM OPERATING ACTIVITIES
 
 
 
Net income (loss)
$
221

 
$
(31
)
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Deferred income taxes
46

 
(36
)
Depreciation
229

 
205

Amortization
22

 
21

Stock-based compensation
17

 
14

Impairment of long-lived assets

 
319

Changes in certain operating assets and liabilities
430

 
233

Other, net
3

 
(3
)
Net cash provided by operating activities
968

 
722

CASH FLOWS FROM INVESTING ACTIVITIES
 
 
 
Capital expenditures
(328
)
 
(368
)
Predelivery deposits for flight equipment
(142
)
 
(38
)
Purchase of held-to-maturity investments
(289
)
 
(175
)
Proceeds from the maturities of held-to-maturity investments
250

 
211

Purchase of available-for-sale securities
(609
)
 
(210
)
Proceeds from the sale of available-for-sale securities
545

 
250

Other, net
5

 
(11
)
Net cash used in investing activities
(568
)
 
(341
)
CASH FLOWS FROM FINANCING ACTIVITIES
 
 
 
Proceeds from issuance of common stock
27

 
24

Proceeds from issuance of long-term debt

 
279

Repayment of long-term debt and finance lease obligations
(182
)
 
(124
)
Acquisition of treasury stock
(256
)
 
(257
)
Net cash used in financing activities
(411
)
 
(78
)
(DECREASE) INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH
(11
)
 
303

Cash, cash equivalents and restricted cash at beginning of period
533

 
359

Cash, cash equivalents and restricted cash at end of period(1)
$
522

 
$
662

 
 
 
 
SUPPLEMENTAL CASH FLOW INFORMATION
 
 
 
Cash payments for interest (net of amount capitalized)
$
33

 
$
26

Cash payments for income taxes (net of refunds)
(88
)
 
10

 
 
 
 
(1) Reconciliation of cash, cash equivalents and restricted cash reported within the Consolidated Balance Sheets:
 
June 30, 2019
 
June 30, 2018
Cash and cash equivalents
$
461

 
$
603

Restricted cash
61

 
59

Total cash, cash equivalents and restricted cash
$
522

 
$
662



See accompanying notes to condensed consolidated financial statements.
7

Table of Contents
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited, in millions)

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 March 31, 2019
 
423

 
$
4

 
122

 
$
(1,377
)
 
$
2,186

 
$
3,795

 
$
(1
)
 
$
4,607

Net income
 

 

 

 

 

 
179

 

 
179

Other comprehensive income
 

 

 

 

 

 

 
2

 
2

Vesting of restricted stock units
 

 

 

 
(1
)
 

 

 

 
(1
)
Stock compensation expense
 

 

 

 

 
8

 

 

 
8

Stock issued under Crewmember stock purchase plan
 
2

 

 

 

 
27

 

 

 
27

Shares repurchased
 

 

 
7

 
(125
)
 

 

 

 
(125
)
Balance at June 30, 2019
 
425

 
$
4

 
129

 
$
(1,503
)
 
$
2,221

 
$
3,974

 
$
1

 
$
4,697

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common
Shares
 
Common
Stock
 
Treasury
Shares
 
Treasury
Stock
 
Additional
Paid-In
Capital
 
Retained
Earnings
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Total
Balance at March 31, 2018
 
419

 
$
4

 
103

 
$
(1,021
)
 
$
2,134

 
$
3,654

 
$

 
$
4,771

Net (loss)
 

 

 

 

 

 
(121
)
 

 
(121
)
Other comprehensive income
 

 

 

 

 

 

 

 

Vesting of restricted stock units
 

 

 

 
(1
)
 

 

 

 
(1
)
Stock compensation expense
 

 

 

 

 
6

 

 

 
6

Stock issued under Crewmember stock purchase plan
 
2

 

 

 

 
24

 

 

 
24

Shares repurchased
 

 

 
5

 
(100
)
 
(25
)
 

 

 
(125
)
Balance at June 30, 2018
 
421

 
$
4

 
108

 
$
(1,122
)
 
$
2,139

 
$
3,533

 
$

 
$
4,554

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common
Shares
 
Common
Stock
 
Treasury
Shares
 
Treasury
Stock
 
Additional
Paid-In
Capital
 
Retained
Earnings
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Total
Balance at December 31, 2018
 
422

 
$
4

 
116

 
$
(1,272
)
 
$
2,203

 
$
3,753

 
$
(3
)
 
$
4,685

Net income
 

 

 

 

 

 
221

 

 
221

Other comprehensive income
 

 

 

 

 

 

 
4

 
4

Vesting of restricted stock units
 
1

 

 

 
(6
)
 

 

 

 
(6
)
Stock compensation expense
 

 

 

 

 
17

 

 

 
17

Stock issued under Crewmember stock purchase plan
 
2

 

 

 

 
26

 

 

 
26

Shares repurchased
 

 

 
13

 
(225
)
 
(25
)
 

 

 
(250
)
Balance at June 30, 2019
 
425

 
$
4

 
129

 
$
(1,503
)
 
$
2,221

 
$
3,974

 
$
1

 
$
4,697

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Common
Shares
 
Common
Stock
 
Treasury
Shares
 
Treasury
Stock
 
Additional
Paid-In
Capital
 
Retained
Earnings
 
Accumulated
Other
Comprehensive
Income (Loss)
 
Total
Balance at December 31, 2017
 
418

 
$
4

 
97

 
$
(890
)
 
$
2,127

 
$
3,564

 
$

 
$
4,805

Net (loss)
 

 

 

 

 

 
(31
)
 

 
(31
)
Other comprehensive income
 

 

 

 

 

 

 

 

Vesting of restricted stock units
 
1

 

 

 
(7
)
 

 

 

 
(7
)
Stock compensation expense
 

 

 

 

 
14

 

 

 
14

Stock issued under Crewmember stock purchase plan
 
2

 

 

 

 
23

 

 

 
23

Shares repurchased
 

 

 
11

 
(225
)
 
(25
)
 

 

 
(250
)
Balance at June 30, 2018
 
421

 
$
4

 
108

 
$
(1,122
)
 
$
2,139

 
$
3,533

 
$

 
$
4,554


See accompanying notes to condensed consolidated financial statements.
8

Table of Contents
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JETBLUE AIRWAYS CORPORATION
NOTES TO 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. 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 2018 audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2018, or our 2018 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 U.S., 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 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. We recast financial information previously filed under Accounting Standards Codification (ASC), or the Codification, Topic 840, Leases for the periods presented to reflect the modified retrospective method of transition to Accounting Standards Update (ASU) 2016-02, Leases (Topic 842) of the Codification. Refer to Note 4 to our consolidated financial statements for more information.
Investment Securities
Investment securities consist of available-for-sale investment securities and held-to-maturity investment securities. We use a specific identification method to determine the cost of the securities when they are sold.
Held-to-maturity investment securities. The contractual maturities of the held-to-maturity investments we held as of June 30, 2019 were not greater than 24 months. We did not record any significant gains or losses on these securities during the three and six months ended June 30, 2019 or 2018. The estimated fair value of these investments approximated their carrying value as of June 30, 2019 and December 31, 2018, respectively.
The carrying values of investment securities consisted of the following at June 30, 2019 and December 31, 2018 (in millions):
 
June 30, 2019
 
December 31, 2018
Available-for-sale securities
 
 
 
Time deposits
$
290

 
$
190

U.S. Treasury

 
39

Debt securities
7

 
7

Total available-for-sale securities
297

 
236

Held-to-maturity securities
 
 
 
U.S. Treasury
155

 
180

Total investment securities
$
452

 
$
416


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 ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, 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 were $26 million and $25 million as of June 30, 2019 and December 31, 2018, respectively.


9

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



Recent Accounting Pronouncements
In February 2016, the Financial Accounting Standards Board, or FASB, issued ASU 2016-02, Leases (Topic 842) of the Codification, which requires lessees to recognize leases on the balance sheet and disclose key information about leasing arrangements. Topic 842 was subsequently amended by ASU 2018-01, Land Easement Practical Expedient for Transition to Topic 842; ASU 2018-10, Codification Improvements to Topic 842, Leases; ASU 2018-11, Targeted Improvements; ASU 2018-20, Narrow-Scope Improvements for Lessors; and ASU 2019-01, Leases (Topic 842): Codification Improvements. Under the new standard, a lessee will recognize liabilities on the balance sheet, initially measured at the present value of the lease payments, and right-of-use (ROU) assets representing its right to use the underlying asset for the lease term. For leases with a term of 12 months or less at the commencement date, a lessee is permitted to make an accounting policy election not to recognize lease assets and lease liabilities. The new standard also eliminates the build-to-suit lease accounting guidance which results in the derecognition of build-to-suit assets and liabilities that remained on the balance sheet after the end of the construction period.
We adopted the requirements of ASU 2016-02 as of January 1, 2019, utilizing the modified retrospective method of transition for all leases existing at or commencing after the date of initial application. We recorded a $58 million cumulative adjustment to retained earnings as of January 1, 2017, the beginning of the retrospective reporting period, for the impact of the new accounting standard. The adjustment to retained earnings was driven principally by the derecognition of our existing assets constructed for others and construction obligation related to our Terminal 5 (T5) build-to-suit project at John F. Kennedy International Airport in New York.
We elected to use the package of transition provisions available for expired or existing contracts, which allowed us to carryforward our historical assessment of whether contracts are or contain leases, lease classification, and initial direct costs. Refer to Note 4 to our consolidated financial statements for more information.
In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement. The update eliminates, adds, and modifies certain disclosure requirements for fair value measurements. ASU 2018-13 is effective for annual reporting periods beginning after December 15, 2019, with early adoption permitted of the entire standard or only the provisions that eliminate or modify disclosure requirements. We are still evaluating the full impact of adopting the amendments on our consolidated financial statements.
In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other— Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The update provides guidance for determining if a cloud computing arrangement is within the scope of internal-use software guidance, and would require capitalization of certain implementation costs. ASU 2018-15 is effective for annual reporting periods beginning after December 15, 2019, with early adoption permitted. We adopted the requirements of ASU 2018-15 on April 1, 2019 using the prospective transition method. The adoption of this amendment did not have a material impact on our consolidated financial statements.

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 and six months ended June 30, 2019 and 2018 (in millions):


10

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


 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019
2018
 
2019
2018
Passenger revenue
 
 
 
 
 
Passenger travel
$
1,981

$
1,820

 
$
3,733

$
3,471

Loyalty revenue - air transportation
50

38

 
100

78

Other revenue
 
 
 
 
 
Loyalty revenue
49

44

 
93

80

Other revenue
25

26

 
51

53

Total revenues
$
2,105

$
1,928

 
$
3,977

$
3,682


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)
June 30, 2019
 
December 31, 2018
Contract liabilities
 
 
 
Air traffic liability - passenger travel
$
1,133

 
$
892

Air traffic liability - loyalty program (air transportation)
617

 
580

Deferred revenue
10

 
10

Total contract liabilities
$
1,760

 
$
1,482


During the six months ended June 30, 2019 and 2018, we recognized revenue of $819 million and $759 million, respectively, which was included in contract liabilities 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 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 TrueBlue® points, and includes points earned and sold to participating companies (in millions):
Balance at December 31, 2018
$
580

TrueBlue® points redeemed
(100
)
TrueBlue® points earned and sold
137

Balance at June 30, 2019
$
617

 
 
Balance at December 31, 2017
$
502

TrueBlue® points redeemed
(78
)
TrueBlue® points earned and sold
112

Balance at June 30, 2018
$
536


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.


11

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



Note 3—Long-Term Debt, Short-Term Borrowings, and Finance Lease Obligations
During the six months ended June 30, 2019, we made scheduled principal payments of $182 million on our outstanding long-term debt and finance lease obligations.
We had pledged aircraft, engines, other equipment and facilities with a net book value of $2.8 billion at June 30, 2019 as security under various financing arrangements. At June 30, 2019, scheduled maturities of all of our long-term debt and finance lease obligations were $128 million for the remainder of 2019, $273 million in 2020, $263 million in 2021, $240 million in 2022, $223 million in 2023, and $365 million thereafter.
The carrying amounts and estimated fair values of our long-term debt, net of debt acquisition costs, at June 30, 2019 and December 31, 2018 were as follows (in millions):
 
June 30, 2019
 
December 31, 2018
 
Carrying Value
 
Estimated Fair Value
 
Carrying Value
 
Estimated Fair Value
Public Debt
 
 
 
 
 
 
 
Fixed rate special facility bonds, due through 2036
$
42

 
$
45

 
$
42

 
$
44

Non-Public Debt
 
 
 
 
 
 
 
Fixed rate enhanced equipment notes, due through 2023
140

 
147

 
151

 
153

Floating rate equipment notes, due through 2028
223

 
225

 
245

 
245

Fixed rate equipment notes, due through 2028
988

 
1,054

 
1,125

 
1,135

Total(1)
$
1,393

 
$
1,471

 
$
1,563

 
$
1,577


(1) Total excludes finance lease obligations of $99 million for June 30, 2019 and $107 million for December 31, 2018.
The estimated fair values of our publicly held long-term debt are classified as Level 2 in the fair value hierarchy. The fair values of our enhanced equipment notes and our special facility bonds were based on quoted market prices in markets with low trading volumes. The fair value of our non-public debt was 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. The fair values of our other financial instruments approximate their carrying values. Refer to Note 9 to our 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 the Consolidations topic of the Codification, and must be considered for consolidation in our condensed consolidated 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, liquidity facilities and 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 condensed consolidated financial statements.


12

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


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 approximately $425 million. The term of the facility runs through April 2021. Borrowings under the Credit and Guaranty Agreement bear interest at a variable rate equal to LIBOR, plus a margin. The Credit and Guaranty Agreement is secured by Slots at John F. Kennedy International Airport, LaGuardia Airport and Reagan National Airport as well as certain other assets. Slots are rights to take-off or land at a specific airport during a specific time period and are a means by which airport capacity and congestion can be managed. 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 June 30, 2019 and December 31, 2018, we did not have a balance outstanding or any borrowings under this line of credit.
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 June 30, 2019 and December 31, 2018, we did not have a balance outstanding or any borrowings under this line of credit.

Note 4—Leases
As discussed in Note 1 to our consolidated financial statements, we adopted ASU 2016-02, Leases (Topic 842) of the Codification, as of January 1, 2019. The new standard requires leases with durations greater than twelve months to be recognized on the balance sheet. Our 2018 and 2017 financial statements have been recast to reflect the retrospective application of the new standard.
Operating lease assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term.
Leases with a term of 12 months or less are not recorded on the balance sheet. Our lease agreements do not contain any residual value guarantees. For facility leases, we account for the lease and non-lease components as a single lease component.
The table below presents the lease-related assets and liabilities recorded on our consolidated balance sheets (in millions):


13

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


 
 
Classification on Balance Sheet
 
June 30,
2019
 
December 31,
2018
Assets
 
 
 
 
 
 
Operating lease assets
 
Operating lease assets
 
$
998

 
$
1,056

Finance lease assets
 
Property and equipment, net
 
174

 
181

Total lease assets
 
 
 
$
1,172

 
$
1,237

 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
Current:
 
 
 
 
 
 
Operating lease liabilities
 
Current operating lease liabilities
 
$
133

 
$
133

Finance lease liabilities
 
Current maturities of long-term debt and finance leases
 
18

 
18

Long-term:
 
 
 
 
 

Operating lease liabilities
 
Long-term operating lease liabilities
 
753

 
798

Finance lease liabilities
 
Long-term debt and finance lease obligations
 
81

 
89

Total lease liabilities
 
 
 
$
985

 
$
1,038

 
 
 
 
 
 
 
 
 
June 30,
2019
 
December 31,
2018
Weighted-average remaining lease term (in years)
 
 
 
 
Operating leases
 
11

 
11

Finance leases
 
3

 
4

Weighted-average discount rate
 
 
 
 
Operating leases
 
5.96
%
 
5.95
%
Finance leases
 
4.79
%
 
4.73
%

Flight Equipment Leases
We operated a fleet of 254 aircraft as of June 30, 2019. Of our fleet, 42 aircraft were under operating leases and six aircraft were under finance leases. Our aircraft leases generally have long durations with remaining terms of three months to nine years.
The majority of aircraft operating leases can be renewed at rates based on fair market value at the end of the lease term for one or two years. None of our aircraft operating leases have variable rate rent payments. We have purchase options for 42 of our aircraft leases at the end of their lease term. These purchase options are at fair market value and have a one-time option during the term at fixed amounts that were expected to approximate the fair market value at lease inception.
Facility Leases
Our facility leases are primarily for space at the airports we serve. These leases are classified as operating leases and reflect our use of passenger terminal service facilities consisting of ticket counters, gate space, operations support area, and baggage service offices. We generally lease space directly or indirectly from the local airport authority on varying terms dependent on prevailing practices at each airport. The remaining terms of our airport leases vary from six months to 16 years. Our leases at certain airports contain provisions for periodic adjustments of rental rates based on the operating costs of the airports or the frequency of use of the facilities. Because of the variable nature of the rates, these leases are not recorded as operating lease assets and operating lease liabilities on our condensed consolidated balance sheets.
We also have leases for our corporate offices, training center, and various hangars and airport support facilities at our focus cities.
Other Ground Property and Equipment
We lease certain IT assets, ground support equipment, and various other pieces of equipment. The lease terms of our ground support equipment are less than 12 months, while the amount of other equipment we have is not significant.


14

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


Lease Costs
The table below presents certain information related to our lease costs during the three and six months ended June 30, 2019 and 2018 (in millions):
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019
 
2018
 
2019

2018
Operating lease cost
$
46

 
$
44

 
$
92

 
$
89

Short-term lease cost
1

 
1

 
1

 
1

Finance lease cost:

 

 
 
 
 
Amortization of assets
2

 
2

 
4

 
4

Interest on lease liabilities
1

 
1

 
2

 
2

Variable lease cost
99

 
101

 
194

 
188

Sublease income
(4
)
 
(4
)
 
(7
)
 
(7
)
Total net lease cost
$
145

 
$
145

 
$
286

 
$
277



Other Information
The table below presents supplemental cash flow information related to leases during the three and six months ended June 30, 2019 and 2018 (in millions):
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019
 
2018
 
2019
 
2018
Cash paid for amounts included in the measurement of lease liabilities
 
 
 
 
 
 
 
Operating cash flows for operating leases
$
35

 
$
44

 
$
75

 
$
80

Operating cash flows for finance leases
1

 
1

 
3

 
3

Financing cash flows for finance leases
2

 
2

 
9

 
8



Lease Commitments
The table below presents scheduled future minimum lease payments for operating and finance leases recorded on our consolidated balance sheets, as of June 30, 2019 (in millions):
 
As of June 30, 2019
 
Operating Leases
 
Finance Leases
2019
$
66

 
$
11

2020
132

 
35

2021
127

 
39

2022
118

 
10

2023
109

 
10

Thereafter
678

 
5

Total minimum lease payments
1,230

 
110

Less: amount of lease payments representing interest
(344
)
 
(11
)
Present value of future minimum lease payments
886

 
99

Less: current obligations under leases
(133
)
 
(18
)
Long-term lease obligations
$
753

 
$
81





15

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


We do not have any lease commitments that have not yet commenced as of June 30, 2019.

Note 5—Earnings Per Share
Basic earnings per share is calculated by dividing net 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, and any other potentially dilutive instruments using the treasury stock method. There were no anti-dilutive common stock equivalents during the three and six months ended June 30, 2019. Anti-dilutive common stock equivalents excluded from the computation of diluted earnings per shares amounts were 1.4 million and 1.5 million for the three and six months ended June 30, 2018, respectively.
The following is a reconciliation of weighted average shares and a calculation of earnings per share (in millions, except per share amounts):
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2019
 
2018
 
2019
 
2018
Net income (loss)(1)
$
179

 
$
(121
)
 
$
221

 
$
(31
)
 
 
 
 
 
 
 
 
Weighted average basic shares
300.3

 
315.0

 
303.1

 
318.0

Effect of dilutive securities
1.5

 

 
1.5

 

Weighted average diluted shares
301.8

 
315.0

 
304.6

 
318.0