Good morning, and welcome to United Airlines Holdings' Earnings Conference Call for the Third Quarter of 2025. My name is Regina, and I will be your conference facilitator today. Following the initial remarks from management, we will open the lines for questions. This call is being recorded and is copyrighted. Please note that no portion of the call may be recorded, transcribed or rebroadcast without the company's permission. Your participation implies your consent to our recording of this call. If you do not agree with these terms, simply drop off the line. I will now turn the presentation over to your host for today's call, Kristina Edwards, Managing Director of Investor Relations. Please go ahead.

Thanks, Regina. Good morning, everyone, and welcome to United's Third Quarter 2025 Earnings Conference Call. Yesterday, we issued our earnings release, which is available on our website at ir.united.com. Information in yesterday's release and the remarks made during this conference call may contain forward-looking statements, which represent the company's current expectations, based upon information currently available to the company. A number of factors could cause actual results to differ materially from our current expectations. Please refer to our earnings release, Form 10-K and 10-Q and other reports filed with the SEC by United Airlines Holdings and United Airlines for a more thorough description of these factors. Unless otherwise noted, we will be discussing our financial metrics on a non-GAAP basis on this call, and historical operational metrics will exclude pandemic years of 2020 to 2022. Please refer to the related definitions and reconciliations of these non-GAAP measures to the most directly comparable GAAP measures at the end of our earnings release. Joining us on the call today to discuss our results and outlook are Chief Executive Officer, Scott Kirby; President, Brett Hart; Executive Vice President and Chief Commercial Officer, Andrew Nocella; and Executive Vice President and Chief Financial Officer, Mike Leskinen. We also have other members of the executive team on the line available for the Q&A. And now I'll put the call over to Scott.

Thanks, Kristina, and good morning, everyone. For the last few years, we've talked about an industry that is transforming, and United Airlines is competitively positioned to win. For United, that's meant winning brand loyal customers. The third quarter is another data point that is consistent with the structural, permanent, and irreversible changes occurring in this industry. We delivered strong third-quarter results despite macro volatility in the first nine months of the year, and we now expect to grow earnings for the full year. The first three quarters of the year were an economic downturn for airlines at least, and our ability to grow earnings in the face of the macro issues is proof that the brand loyalty strategy is resilient in tough times and a clear proof point on our path to solid double-digit margins. What we've really proven is air travel is not a commodity. In our calls over the last few years, we spent a lot of time appropriately discussing the industry structure and making predictions about how that would play out in the future. We're now seeing those predictions come true, and even though it's only the second or third inning, I think the general contours of how that is going to end are widely known and easy to forecast at this point. And given that, I think it's time to shift the focus and talk about how United gets to double-digit margins even in the current industry environment. There are two points on the revenue side and likewise, two points on the cost side. On the revenue side, it starts with winning brand loyal customers. United is investing over $1 billion in customer product enhancements annually. And that investment is in all cabins and class of service. Every customer who flies United gets more value. For basic economy customers, we don't just offer them a competitively priced ticket. We offer them the best app and on-time flight performance in every seat, seatback screens, a great loyalty program, just to name a few. For brand loyal customers, we offer all these benefits plus expansive clubs, more seats upfront, better food, and a more extensive route network to exotic destinations around the globe, and a loyalty program that gives bigger rewards and a tremendous amount of utility for their miles. And most importantly, our people are our best asset, and they're delivering for all of our customers each and every day. We're in the people business, and our people have done an amazing job of caring and providing friendly service that makes customers feel good and is the foundation of keeping them brand loyal. From basic economy all the way to the Polaris class, every United customer simply gets more value at United than what our competitors offer. And that's why they are brand loyal. It's also why we're winning more brand loyal customers every day, and it's the important competitive advantage that's giving us a generational lead versus most of the industry. We believe that winning brand loyal customers sets up our second revenue advantage, which is the potential to double the EBITDA from our loyalty program in the years to come. We're still in the pre-game warm-ups for taking the United loyalty program to another level. But in order to invest over $1 billion per year in incremental customer products and services, we had to find a different and better way to manage costs. Historically, airlines looking to reduce costs have focused on cutting customer-friendly amenities like food because most of our expense is in areas we can't control, like union contracts, airport fees, fuel, etc., or by adding utilization flying late at night on off-peak days or during slower times of the year. United is doing the exact opposite of that industry practice, namely investing more for the customer and focusing on flying at times that can be profitable instead of just trying to maximize aircraft utilization. And you can see it in our numbers. Our major cost focus at United is to drive real cost efficiencies through our use of technology that can also improve the customer experience. In public discussions, we tended to focus more on customer-facing technology, but we're doing far more behind the scenes and we're the most cutting-edge technology airline in the world. Mike will give you some examples of these technology-driven savings that allow us to lower true CASM-ex. These technology investments are efficient for costs, but they also help us to run a more reliable operation for customers. And secondly, on costs, we have large gauge increases coming as both Boeing and Airbus get back to a better delivery cadence. This strategy is working, and I expect us to add at least one point or more of margin each year normalized for any unusual macroeconomic activity up or down, which gets us to the low teen margins in this industry capacity environment. But as I said earlier, the industry restructuring, i.e., each airline focusing its capacity in markets where they can be profitable is only in the second or third inning. And as that process plays out, I expect that to add several more margin points to United, moving us up into the mid-teens margins. And as we deliver on that, I bet that our multiples will move up meaningfully as well. I'll now turn it back to the team for a run through the quarter and our outlook.

Thank you, Scott, and good morning. This summer was the busiest in United's history. We surpassed 1 billion available seat miles in a single day and flew over 48 million customers in the quarter. Even with these volumes, as well as significant summer weather disruptions and system-wide ATC challenges, our operation was resilient this quarter. The third quarter marked our lowest rate of cancellations for any third quarter in company history, and six of our seven hubs ranked first or second for on-time departures. We continue to adapt under pressure and maintain flexibility during irregular operations, preserving travel plans for more than 290,000 customers by managing delays rather than canceling flights. This is what drives the most value for our customers and helps build the brand loyalty we speak so much about. And our customer NPS score was up nearly 7% this summer versus summer 2024. This performance is a testament to the dedication of our United team, so thank you to each of you. At United, we remain focused on innovation and providing our teams with the most advanced tools in the industry to help them deliver their best every day. We are modernizing applications for employees that allow us to recover faster, scale support for customers, and enable better experiences even when things don't go as planned. We also continue to invest in our industry-leading digital customer experience with a new dedicated section of our mobile app focused on making tight connections smoother and more predictable for customers through real-time personalized tools and communication, driving further improvements in our customer experience and NPS scores. As we continue to take aircraft deliveries, we will also be growing our team. In 2026, we expect to hire over 2,000 pilots and over 3,200 new flight attendants. We are all proud of the fact that we continue to be a destination for great talent with over 27,000 applicants in just a few days for the most recent flight attendant posting. Regarding the negotiations with the AFA, we met with the mediator in mid-September, and our negotiation is scheduled for the end of October. We remain focused on getting our flight attendants, the best in the industry, the industry-leading contract they deserve. I want to thank Secretary Duffy, Administrator Bedford, and the administration for their support and leadership on the improvement at Newark. We are pleased with the FAA's announcement that flights in Newark will be capped through October 2026 at 72 operations per hour, which better matches the capacity of the airport. The reduction in emissions, along with the continued focus on technology upgrades and ATC staffing further underpins our confidence in Newark's long-term outlook. Newark achieved its best-ever on-time departure and Star D0 for any third quarter, clear proof that the investments being made are working. Yesterday, our first Starlink Equipped Boeing 737-800 took off from Newark following FAA certification last month. This marks a major milestone in our journey to deliver the fastest, most reliable, and free WiFi for Mileage Plus members in the skies. More than half of our regional flights now have Starlink successfully installed. We believe this superior in-flight experience will be truly game-changing as it expands across the remainder of our fleet by 2027. Thank you to the entire United team for your continued hard work and commitment to excellence this quarter. I will now hand it over to Andrew to provide an update on the revenue environment.

Thanks, Brett. United's top line revenues increased 2.6% to $15.2 billion in the quarter on a 7.2% increase in capacity. Consolidated TRASM for the quarter was down 4.3%. Domestic PRASM was down 3.3% in Q3 on 6.6% more capacity; premium cabins outperformed the main cabin once again. After a long stream of positive RASM in recent quarters, United's international flights in Q3 had PRASM down 7.1%. Global long-haul demand continues to spread both earlier and later in the year out of Q3, making those periods stronger, but trade we take any day. Premium revenues were up 6% year-over-year, and PRASM for premium cabins outperformed the main cabin by 5 points. United had the company's all-time highest business revenue during the week ended October 5; of the top five best weeks in our history, three of the remaining four occurred in September 2025. Leisure demand is also healthy as we head into Q4. Not unlike 2024, capacity and demand are simply better balanced in the last quarter of this year, particularly for global long-haul flying. We saw bookings inflect positively in early July, and industry revenues are expected to be positive year-over-year for all remaining months of 2025. We expect our consolidated RASM to meaningfully improve in Q4 year-over-year. International RASMs in Q4 will outperform domestic based on the current outlook. We also expect that Q4 will have United's best revenue quarter ever, but also have the highest absolute RASM of any quarter of 2025. As you can see by the stressed financials at many airlines, it is clear much of their domestic flying once again lost money in 2025, but also in the peak summer quarter. It is already beginning, but we believe more unprofitable industry flying will continue to be scaled back, although the timing remains uncertain. While the supply/demand imbalance did impact United's profits in the third quarter, we can report all seven of our hubs were profitable in the quarter. We, at United, remained focused on refinements we can make to the network and commercial strategies to build a stronger margin, particularly in the third quarter of each year. Two years ago, we focused on adjustments to our Q1 network deployment that led to nearly a 4-point improvement in pretax margins. In 2026, we're going to take a similar approach to Q3. For most of the recent prepandemic history, Q3 RASMs were consistent with Q2 and Q4, with a modest peaking of the capacity in Q3, where marginal RASM was greater than marginal CASM. However, in 2024, we saw GAAP emerge where Q3 RASM at United trailed Q2 and Q4. We expect that to once again exist and to have widened in 2025. This Q3 issue appears to be an industry issue not specific to United. As much as we love the relative Q4 performance in recent years, the idea that Q3 trails by the magnitude we've seen in 2024 and in 2025 represents an opportunity for margin expansion. In 2026, we'll adjust how peaked our summer capacity plan is by ending the summer schedule a week early, operating 15% fewer red-eye flights and tending more capacity from the July 4 holiday, to name a few, in pursuit of higher margins. I also expect that our Atlantic capacity year-over-year, excluding Tel Aviv, will be flat to negative in Q3 2026. United's business model now has a more balanced demand level across more of the year as our increasingly optimal mix between leisure demand, premium leisure demand, and business demand is yet another emerging advantage we have over commodity-based airlines. United's ability to further de-seasonalize capacity, we think, creates yet another opportunity for cost convergence versus commodity airlines, as they only see profit opportunities on peak leisure travel demand days or months. I think it's interesting to note that profitability is now inversely correlated with aircraft utilization in the U.S. The highest utilization airlines have the lowest margins. Mileage Plus had another strong quarter with total loyalty revenues up over 9%, overhead remuneration was up 15% year-over-year and should end the year up over 12%. We are seeing increased retention of cardholders along with higher spend as United's brand grows. Today, I'd also like to share my view of where United has come from in the past decade, why our actual 2025 results thus far have proven so durable and what we expect to drive continued gains among brand loyal customers and double-digit margins down the line. Starting with our many transformational annual investments of over $1 billion for our customers, we have successfully decommoditized most of United's passenger revenues. We believe that our tilt to brand loyal capacity and products in the last five years was well timed, but also consistent with the demand profile in our hub cities, which is why it's worked so well and why our premium efforts will be more margin accretive than others. However, it's important to understand we're always investing to create value for all passengers in all cabins. Even our most premium yield passengers often fly in the main cabin, and our efforts to convert passengers to brand loyal clearly starts in the main cabin. Basic Economy has altered the competitive landscape in the U.S. and provided United a profitable entry to attract many customers over a full life cycle. Quality and value matter more than ever to U.S. consumers; clubs that are not overcrowded, enhanced meals, great wine, industry leading technology, great customer service, seat-back screens, and fast WiFi, to name a few, those are the attributes we focus on. The quality part of the product offering was often overlooked by many as we favored simplicity and low cost. In our view, quality goes well beyond the schedule we offer and our inherent excellent reliability. Smaller details do matter, and that combined with best-in-class customer service our team members deliver sets us up for success. Consistency of our products and services was unsurprisingly low at the early stages of our transformation, but is now reaching critical mass. United now operates 765 jets with more than 146,000 seat-back screens. These screens are one way of defining a premium airline in the U.S. Our signature interior conversion is now at 64% and with an investment of over $1.6 million. At United, we've proven our ability to increase our relative RASM with the best results, while at the same time increasing domestic gauge by almost 20% since 2019. We said a decade ago that not all capacity was created equal, and our results have proven that business case. The statement is only true for brand loyal airlines. Domestic gauge is expected to once again accelerate in 2027 as our A321 fleet reaches critical mass after years of delay, helping drive better customer experience, but also creating cost convergence with others. This gauge increase is a proven formula for margin growth and accelerates as we retire smaller, lower-margin A319 and A320 aircraft from our fleet by 2030. United hubs can support this higher gauge and allows us to accept more basic economy customers at a profit. Our transformation is making the world a smaller place for United and allowed us to add unique flight places including, but not limited to, Greenland and Mongolia. A large thanks to the 100,000-plus United team members who together have built this durable generational lead. I'm going to turn it over to Mike to talk about our financial results.

Thanks, Andrew. We delivered a strong third quarter. Customers are speaking with their wallets and are increasingly choosing to fly United because of our strong operational performance and the significant investments we made and continue to make in the airline. StarLink is another example of how we're differentiating our customer experience for the better. This quarter, I'm particularly proud of our team for our disciplined cost management. I expect that our CASM-ex performance will be industry-leading. As Scott mentioned, we made strategic investments in our products that drive higher costs, but we are helping to offset those by running the core airline more efficiently. And those investments are increasingly differentiating United Airlines, creating brand loyal customers, decommoditizing United, and driving solid margins and returns on capital. We've been investing over $1 billion annually over the last few years into improving our aircraft, our clubs, our food, and our WiFi, and we expect to spend another $1 billion next year. We increased the amount we spend on food by 25% this year. We're investing $1 billion on our rollout of Starlink WiFi so that our customers have the best-in-class connectivity. Our investments in clubs doubled in 2025 and are expected to more than double in 2026 as demand for this product continues to grow. These are just a few examples, but it's important to note that we're doing this all while delivering industry-leading cost performance. Being able to invest in our customer experience is possible because we're simultaneously driving efficiency in the core operation. That produces meaningful and permanent savings. Some examples include modernizing all of our maintenance technologies so they can be used on iPads, allowing our technicians quicker access to United resources. For example, before introducing iPads throughout the shift, our technicians would walk to and from our hangars and aircraft, checking the aircraft's paper logbook, printing manuals from the legacy mainframe systems at the hangar, and ordering parts from their terminal at the hangar to ultimately fix the aircraft. Today, iPads give technicians the ability to instantaneously access troubleshooting manuals and order parts, all while at the aircraft, turning airplanes faster and improving the efficiency of our workforce. Additionally, significant investments in people, process, and technology have been made to improve our recovery from irregular operations events, which enable us to restart the airline following an event much quicker than we have in the past. One particular tool already in use is our Orca tool, which optimizes aircraft routing, crew pairings, and customer connections to ensure our targeted delays or cancels prioritize our customers in the optimal plan for guiding the airline through significant events. Our operational leadership and frontline employees are performing the best in our history. This has led to United leading the industry in the quickest recovery following significant events, and you can see the direct impact of that comparing our third-quarter cost to others in the industry. We're not just looking to make our operation more efficient. We're making process-changing changes and using AI to make the work of our headquarters management team more efficient too. In fact, our management headcount is 4% lower than last year as this efficiency work continues, and we're planning to shrink another 4% in 2026. This is a new culture at United Airlines, and as such, I'm going to give a long-term framework on how we're thinking about CASM-ex. General inflation in this industry is running about 3% to 4% annually, and we expect that to continue, inclusive of labor. At United, our gauge growth should provide about a one-point annual tailwind through the end of the decade. We're also committed to driving efficiency into the core business of another point per year. So together, our core CASM-ex growth should run up at 1% to 2% annually if we did nothing else. But as we've been highlighting, United is transforming because of our investments we have made into improving the customer experience and decommoditizing air travel. You should expect that to continue, and on average, we expect that to add about one point of CASM-ex pressure per year that is more than offset by revenue generation. Altogether, our CASM-ex run rate should run up around 2% to 3% annually. Now turning to the quarter. We delivered third-quarter earnings per share of $2.78, above the top end of our guidance range of $2.25 to $2.75 and ahead of Wall Street expectations of $2.68. Our pretax margin was 8% and would have been a point higher absent the disruptions earlier this year at Newark. We had industry-leading operational performance that underpins strong unit cost performance. Our third-quarter CASM-ex was down 0.9%. Our costs in the quarter did benefit by approximately 1 point of expense moving to the fourth quarter, primarily driven by maintenance and approximately 1 point from the timing of certain labor contracts. Looking to the fourth quarter, the momentum in the revenue environment, Andrew described, continues, and we expect fourth-quarter EPS to be $3 to $3.50, which brings our full-year EPS towards the better half of our full-year 2025 guidance range of $9 to $11, and should position us to be the only airline to grow earnings this year. This demonstrates that winning brand loyal customers drives resilience in the business and when the economy rallies provides upside. As I mentioned last quarter, the industry now has two brand-loyal, structurally profitable, and revenue diverse airlines, which together will represent about 100% of industry profits in 2025. We continue to target double-digit pretax margins in the long term. Turning to the balance sheet, we continue to march towards our goal of an investment-grade balance sheet. During the quarter and earlier this month, we bought back aircraft off of expensive COVID leases, carrying implied interest rates in the high single digits. This accelerated our deleveraging efforts while further optimizing our cost of capital. We've eliminated all expensive financing from the balance sheet and have no fixed coupons over 6%, an average floating margin of 1.9%, and an average cost of debt of less than 5%. These actions are being noticed by the rating agencies. We were upgraded by S&P to BB+ from BB on August 12, the highest they have rated us in over two decades. This change gives recognition to the fact that our business plan is working as our earnings grow and become more resilient and continue our migration towards investment-grade credit ratings. Free cash flow generation also remains a key focus, and we expect to generate over $3 billion in free cash flow this year. I've talked about free cash flow conversion around 50%, and this year we're trending well above that due to the timing of aircraft deliveries. As aircraft deliveries accelerate and CapEx rises, we expect to remain in the 50% range. As we exit the decade, we expect the conversion to accelerate closer to around 75%. On the buyback, we continue to take a measured approach and take advantage of opportunistic moves in the market while also working towards getting our net leverage below 2x. To wrap it up, I want to thank the team for their continued execution. Our ability to manage through what has been an earnings recession for the airline industry has been remarkable. And while I still think there is upside to our absolute margin, and that matters the most, our relative margin is outstanding. My confidence in the financial future continues to grow as we exit the year. United Airlines and the industry continue to transform into a customer-centric brand-loyal business. United Airlines will continue to provide more value to our customers, to our employees, and to our shareholders. Now back to Kristina to start Q&A.

Thanks, Mike. We will now take questions from the analyst community. We want to get to as many of you as possible, so please limit yourself to one question and if absolutely needed, one follow-up question. Regina, please describe the procedure to ask a question.

The first question comes from Catherine O'Brien with Goldman Sachs.

So first, a follow-up to Scott's margin commentary to kick off the call. We've seen domestic main cabin seats come out of the market this year, although there has been backfill. You noted that system margins would go up a couple of points if the industry rationalized more. But what's your view on what would happen to main cabin margins if there was a step-function change in main cabin supply? Would that narrow or even close the gap between main cabin and premium cabin margins? Or is there just always going to be a gap given the demand profile of price-sensitive versus more premium customers?

Thank you, Catherine, for the thought-provoking question. To address it, let me provide some background on the industry's development. Throughout my career, those involved in the airline industry, including executives like myself, Wall Street analysts, and investors, have mainly viewed it as a commodity, regarding both price and schedule. This perspective has dominated our thinking, which is why many on Wall Street believe every seat is the same and conduct competitive capacity analyses based on that assumption. I also believe this contributes to our low trading multiples, as is typical in commodity industries. However, what we have demonstrated and continue to demonstrate is that it is indeed feasible to evolve into a brand-loyal airline, which stands in stark contrast to the commoditized aspect of this industry. When considering brand-loyal customers, they represent a significant portion of the market, albeit not the entirety. For these customers, schedule remains the most critical factor, shaping our initial perception of the industry as commoditized. Many customers have several airlines with comparable schedules to choose from and often prefer to establish loyalty with one airline to accumulate miles, obtain credit cards, and travel to exciting destinations worldwide. To capture these customers, we must focus on delivering exceptional value, starting with a reliable schedule, then enhancing product, technology, and service quality, complemented by excellent customer interactions. Over the past five years, we've gained substantial market share among customers in our hubs, particularly with those who are brand loyal. This achievement results from nearly a decade of strategic investments amounting to billions, and a consistent strategy over time. I refer to this as a structural change because it is both permanent and irreversible. Regarding the commodity aspect of our business, we do have some seats that serve this segment, although this constitutes a smaller percentage for us than for others. Currently, this part of the business is unprofitable for all involved, especially for ultra-low-cost carriers, which are entirely commoditized. Despite this, brand loyalty leads to higher margins, while the commodity side tends to incur losses. However, supply within the commodity market is shifting, beginning with airlines that are entirely involved in it, and I anticipate this trend will extend beyond them. I expect that within a few years, supply and demand will align for the commodity sector, resulting in profitability for all, albeit with low margins typical in commodity industries. The positive aspect for us is that a significant portion of our revenue will stem from brand-loyal customers. This year, we are demonstrating that this revenue source remains robust even in challenging times, with even greater potential during favorable periods. I believe that airlines with a largely commoditized seat offering will see reduced margins, but they will still find ways to remain profitable. Ultimately, the future will lean toward a few brand-loyal airlines that can achieve more stable earnings and higher margins in the mid-teens.

I really appreciate it. Maybe if I can squeeze in a quick follow-up for Mike on costs. So last quarter, you had said fourth quarter costs will look similar to 2Q inclusive of certain deals. There's quite a lot of moving pieces since then with the flight attendants and some maintenance shifts. Can you just update us on pulling that tethered? Could CASM still be close to that 2Q reference point? Or if not, just help us frame it a bit more?

Thanks for the question, Catie. And look, we've got about a point benefit from maintenance moving from Q3 into Q4, as I said. We also get about a one-point benefit from the labor agreement. Underlying that, we also got a further third point of goodness that I think is indicative of what you're going to see in the future from us, of underlying core efficiency. So all that came together for really an excellent result. I do expect Q4 to trend up from the Q3 level, but really proud of those results.

So a question for Andrew. Last week, the topic of premium leisure yields exceeding certain corporate yields came up. Obviously, it's easy to find isolated examples of this. But my question to you is how widespread might this be across your network? And does this potentially represent a secular change? Or should investors still remain focused on corporate yields as representing the gold standard in the long run, the way they clearly were a decade ago?

Happy to, it's a really good question, Jamie. And it's a new dynamic based on everything else in our business that's complicated. So the answer is, the premise is correct that we've seen the growth of premium leisure and the yield quality accelerate really fast. When we look at it across our domestic system, we find, in fact, the quality of premium leisure business often exceeds that traditional corporate business, which, by the way, is a much smaller percentage of United business than it was in 2019. I think the distinction that I'll give you, that's a little bit different, is that the same phenomenon is not yet true in global long haul, that the corporate there does remain a much higher yield than the premium leisure business at this point. But again, premium leisure continues to accelerate. The percentage of the cabin continues to grow, and our overall sold load factors and Polaris continue to grow. So we seek through revenue management, the best of both worlds. We seek to maintain all that corporate business and gain corporate share, while at the same time, as we reconfigure aircraft, taking on more and more premium leisure business. I couldn't be more excited about this trend; it's just an amazing now that I don't think anybody would have predicted in 2019, but it's come true and it's come true quarter after quarter, I think for three years in a row now, and it will come true again in Q4 this year, and we will lean further into premium capacity next year as a result with things we planned a couple of years ago.

First question for Andrew. I guess I noticed the air traffic liability fell only 3% sequentially. If I look back historically, it's been closer to down 25% to 30%, so I think this clearly supports some of the bullish commentary that you've had on the call. I guess my question is how should we read into this decline in the ATL? Does this speak to just the strong pricing that you're seeing? Or does it say something just in terms of how you're booked today for the rest of the year in terms of volumes than maybe you typically are at this point in time?

Those facts are correct in terms of the ATL. I would say it’s the momentum in the business. It is clearly a lot of good bookings that we've taken over the last few months reflecting our outlook for Q4, which we're really proud of the outlook for Q4 and how it has inflected nicely from Q3. We're also booked a little bit ahead as we go into Q4, and that reflects that. But overall, we've seen a really good environment. I said in my prepared remarks what we saw from business traffic at United, our bookings over the last few weeks, which have been really amazing. So looking forward to a positive news for Q4 and great 2026.

Got it. And then just as a follow-up, I kind of wanted to ask you about the Latin America results in the quarter. Your calls are very focused on margins. So just curious, why did you grow so much in Latin America in Q3 when it seems like the RASM performance certainly didn't warrant it? Just curious your thoughts there and how maybe you can fix that going forward?

Yes. I think that's a very fair question. Look, results for Latin were disappointing. As we look towards Q4, I think Latin will have our largest sequential improvement, but that's not an easy comp. So look, I expect elevated year-over-year capacity in the region to exist for approximately another two quarters by United and the industry, while competitive capacity tailwinds are favorable across most of our network in the coming quarters that isn't true in Latin America, and that's very focused on Mexico and Central America. As we see in our domestic line, we believe most of the new competitive line in the region to the United States is unprofitable and transitory. We have a good position in Houston, and we intend to hold our ground. Non-core, non-Houston line by United that underperformed will be removed. And I'll also say deep south line is setting up for a nice peak season driving improvements. But core United capacity from Houston to Mexico and Central America will continue as planned, and we remain very focused on the long term when it comes to our Houston hub and our Latin American franchise.

Maybe two questions. The first one, short term. Can we talk about the sequential unit revenue trajectory for Q4, the moving pieces of domestic versus international? It's just somewhat interesting that international is going to outperform given where schedules are shaping up? Can you just give us a little bit of data on the booking curve and how the holidays are looking?

Sure. Look, it's Andrew. Q4 is setting up nicely, as I've indicated. And I think as you all can figure out, if you look at our guidance, we're seeing really significant sequential gains in our RASMs. I'll start off with is Newark; clearly had a substantial negative impact on Q3 by a little more than one point, and while we're always yield focused as a premium branded loyal airline, we did temporarily use lower prices across all products to regain share following that event, and that continued for most of Q3. New York share did rebound first with lower yield in local leisure passengers and then with higher yield leisure and corporate business following the improvement throughout the quarter. And while the impact of bookings is largely dissipated, we did build a small deficit of Q3 bookings traveling into Q4, which is in our guide, by the way. The remainder of our Q3 gap relates to the timing of events in 2024, including the Paris Olympics and CrowdStrike. And I think that's pretty simple math that others in the industry have explained. So I'm really excited about the inflection. I think all three international entities are going to see really good sequential improvement. By the way, I think Atlantic, even with elevated capacity, will absolutely be positive in Q4 year-over-year, and probably the same is true for our Pacific entity. We did see this onetime gap in Q3 based on how we shape capacity. And as I said earlier in my prepared remarks, we're going to alter our schedule for 2026 to account for that. And then in the end, across the entire globe, Hawaii has definitely been a strong spot for us. But I'd say the rest of the globe is all performing at the same rate, which is a rate we're pretty happy with when we look again at the sequential improvement.

And maybe a longer-term question. So maybe for you, Scott. You mentioned the 100 bps of margin improvement per year. How do you think about that as 2% to 3% per year? It implies margin expansion is assuming low to mid-single digits per year. So how do you think about the drivers of that? And obviously, a significant divergence from history?

Yes, the math indicates that RASM needs to exceed CASM, and I do expect that to occur. Looking ahead to next year, we will have comparisons to consider. However, we continue to see strong engagement from loyal customers, and when we analyze the data, we notice that we gained market share in each of our hubs, positively impacting our margins. I am quite confident that we can achieve at least one point of margin growth annually. Reflecting on this year, there has been an extraordinary amount of activity industry-wide and specifically in Newark. The fact that we are set to see earnings growth this year is impressive. I use the term resilient because it highlights our strategy. Even if we exclude these factors, we could generate over a full point of margin this year. We are optimistic about our analysis of loyal customers and the trends in our hubs, which will contribute positively. Additionally, I briefly touched on our loyalty program in my opening statements; we have ambitious plans that we won't disclose today, but I believe we can significantly increase our EBITDA from this program by the end of the decade, indicating substantial potential ahead for us.

Sheila, I can provide more insight. When I mentioned the buildup in CASM-ex, I referred to a 1% to 2% increase in CASM-ex due to inflation after we implement efficiencies. Additionally, we are carefully introducing another point as we enhance segmentation and offer more premium products. This cautious approach is driven by consumer preference, encouraging customers to upgrade their cabins and purchase premium products. This strategy is beneficial for profits; if it didn't enhance profitability, we wouldn't pursue it.

And then I'll just add since we're all talking about next year, our premium capacity will be up 2 to 3 points more than our total capacity. I'm not going to give you guidance for next year. But we've preprogrammed this long ago to take advantage of these premium trends and we know that we need to change our commercial strategies, our configurations, and our products in order to achieve those RASM gains. The good news is we’ve preplanned it, and it's going to happen.

I appreciate you've covered a lot of good stuff already. But I wondered if we could bridge from the tone mid-September conferences to today, not really about the third quarter, but forward bookings. I assume you have a good head start on 4Q bookings and advanced yields year-over-year. Can you comment on how much of a head start you've built, specifically maybe on advanced booked yields? And is your relative optimism about transatlantic, is that a volume comment? Or is that a yield comment?

Look, definitely, over the next two months, we've booked ourselves ahead versus last year. So we go into the quarter booked a couple of points ahead, which was intentional on our part. We did use a little bit of yield to make that happen again, but that was intentional based on what we did last year and how we manage the capacity. And so we're happy with that. On the Atlantic, there's a Tel Aviv story, which is different than the rest. But Atlantic, again, we've learned a lot about Q3 seasonality and where capacity should be placed, and we are going to be a lot more prudent with July and August in particular next year and push capacity out into the other quarters. As we look at Atlantic, and you can see the numbers, we're growing pretty swiftly in Q4. I told you already that we expect we will be positive RASM across the Atlantic. So we properly placed our capacity; we're aware of the demand trends, and we're very happy with what it looks like. The last thing I'll add is, in particular for us, the propensity or the share of revenue in premium cabins is the lowest in Q3 and the highest in Q4, which favors United Airlines, given our business-centric airline and how we do well. We're heading into Q4, which is a point of strength for us across the Atlantic, which, again, I don't think if we went back to 2017, '18 or '19, I would be able to say that, and I'm really excited about that.

Can you elaborate on the maintenance expense that has shifted? It seems like there's always something expected to return that doesn't. You've been cautious about this in the past. Is there an accrual for flight attendants included in the Q4 guidance? Should we consider 2026 as one of your key framework years?

Thanks, Duane. I think there are three questions in there. Let me try to address them in order. The Q4, the 1% movement was primarily engines. This happens with some frequency where an engine event that we had been expecting pushes from Q3 to Q4 or Q2 to Q3; that happens. And then, yes, sometimes what happens is that another separate engine event pushes from Q4 into Q1, and therefore, you don't see a catch-up. I do think you'll see the catch-up of that point in Q4 of this year. So that was the point. Regarding flight attendants, look, we've got the best flight attendants in the business; they deserve an industry-leading contract. We're going to give them an industry-leading contract. We're hoping to get back to the negotiation table here in late October and very optimistic we will have a ratified deal in early 2026 to get them that industry-leading pay, but we're not going to accrue for expenses in the quarter when we don't expect a ratification in that quarter. As for your final question around 2026, I think that 2% to 3% is the right expectation for CASM-ex as you look over a multi-year time frame. We do have a build to pay on the labor front. I've been saying for some time that that bill is 2 to 3 points when all of those labor agreements ratify. So we will have some added expense relative to that in 2026.

Scott, I know you asked us not to ask about the doubling of the loyalty EBITDA, but it's a significant topic, so I feel compelled to inquire. Could you discuss the revised agreement on your credit card with Chase prior to the pandemic? I believe we are approaching the time to renegotiate a new agreement. Perhaps you could explain the factors contributing to the doubling, particularly regarding a new rate, and what steps you plan to take behind the scenes to enhance the value of the loyalty program?

Well, look, I'll start. Look, we couldn’t be more excited about the opportunity. There's a lot going on in the space, and I'm not going to divulge the details of our Chase contract in terms of its term; that remains confidential, but the term doesn't go forever, just like every contract we enter into. I think the broader point is that when we think about the frequent flyer program, United is a true loyalty program. And loyalty is different than a reward program. It's important that we manage our program in that vein. There are a bunch of things we can do to take advantage of our unique status. We think there are only in the United States, two to four loyalty programs; everything else we talk about is a reward program. We're not going to announce it today, but we're going to be working very hard to make sure that consumers fully understand the distinction between our program and the alternatives and the rewards and the value that can be achieved at United in a way that I don't think has been done in the past. So I think that's enough of a hint for now, and more to come. But as Scott said, we're very excited about this, and we'll see where we get.

Okay. We'll look forward to that. Maybe sticking with the whole hub theme and capacity in general. Scott, I believe you did an interview recently where you mentioned that United only competes from a position of strength. When you first came here and you all took over United, you talked quite a bit about the Mid-Con hub strategy. I was hoping you could update us on that rebuild. It seems like the industry is currently in a state of change. There's a chance to think about focus cities and similar concepts. Could you discuss the opportunities beyond the seven hubs?

Well, I'll start off and I'm sure Scott can add some of his insights to the conversation. But we haven't completed the United Next assignment that we set out to do. We should complete that either probably in late 2026 or maybe early 2027, and that goal is to reach a certain level of connectivity, critical mass engage that allows us to achieve much higher domestic margins than we have traditionally achieved in our domestic hubs. As I've said many times and I'll say again today, international margins lead the way at United. While I expect that to be true over the long run, I do expect the gap to be able to shrink dramatically based on what we plan for the hubs. In particular, this gauge calculation, we still remain under-gauged; that gauge is going to change our cost convergence calculation even further, allowing us to capture more share at the high end and more share at the low end, all profitably. But we still have roughly one to two more years to go. We'll figure out the exact endpoint. But after that endpoint, we will take a broader look beyond our hubs at what makes sense. But for right now, we're still very focused on our hubs.

I have two quick questions that I'll combine. First, can you provide an approximate percentage of today's EBITDA that comes from loyalty EBITDA, just to understand the base? Second, Mike, regarding your comment about a 2 to 3 point increase from labor, is that an entire incremental 2 to 3 points? Have you already realized some of that from previous labor agreements? I'm trying to clarify the incremental 2 to 3 points.

Let me take the expense question, Scott. This is not the time where we would give 2026 guidance, nor do we give CASM and TRASM guidance anymore. But what I will tell you is with the underlying inflation, with the labor headwinds we expect, we feel very confident about margin expansion and growth in earnings in 2026. For more detail on that, you're going to have to wait for the Q4 call. I'll give loyalty to Andrew.

We can answer. I mean, Andrew just answered a very similar question right before this, Scott. We'll also wait and see for an Investor Day when we provide a clear breakdown of the contribution of this business. But it's obviously a very meaningful portion of our earnings. And for those of you that are next in the queue, I'd suggest you take my recommendation to limit yourself to one question.

I was wondering if you could just update us on the cadence of Starlink installation as we move through 2026, and then how the opportunities that opens up for Connective Media?

I'll give it a start. For United Express, I think we're over halfway through at this point with the Embraer 175s and the overall installation of Starlink on board the aircraft is amazing. Hopefully, everybody tuned into the Today show yesterday to see that demonstration on board. If you haven't, you can find it on social media and TikTok because it was quite amazing. Our first 737-800 took off yesterday from New York to Houston with dramatically higher NPS scores like off the chart on that aircraft equipped with Starlink. It is a game changer, a gate-to-gate experience, reliable and as fast as your living room. This is going to be a unique differentiator versus our other competition. One of the more exciting things is how we intersect Starlink and the ability to deliver unique content to each and every seat in our Connected Media business. Obviously, we have, I think, through the end of 2027 to install Starlink on all of our aircraft, and we're going to do it on every single one of our aircraft. When we have that fully enabled, there's still a bit down the road, the unique things we can do by knowing who's in a seat and being able to deliver unique content to that seat very quickly. That's not only the media opportunity, but also helping in the travel journey, whether you're luggage made it onboard the aircraft or what you're about to eat or any other thing you need to know to make sure that you are stress-free when you travel on United Airlines. So, so much upside. Again, I'm going to go back to the NPS scores on that flight the other day were off the charts; it's a game changer for United. We couldn't be more excited about this; it's one of the biggest things we've done in a really long time and may be underappreciated but will soon be appreciated.

And if you want to geek out, this is Toby on statistics; we had 145 paying customers, 170 devices connected on the inaugural and 145 gigabytes used on the flight, which is about 1,000 times more than a normal flight.

Scott, I know this fourth quarter, I believe, you're going to be making a decision on the future shape and size of your wide-body fleet. I know historically, at least the prevailing view has been that bringing on another airplane type, especially on the wide body side, comes with various pain points. Can you just discuss some of the factors like how that has evolved? Or is it still as prohibitively expensive to bring on an additional type? Just your thoughts around that?

Mike, this is Mike. I'm going to take that question. You're right. We're always thinking about fleet decisions, and this fourth quarter is an important decision for us. There are complexity costs around having additional aircraft types. That is always true for United given the nature of our hub network that has not changed. The larger we grow and to the extent it to a larger sub fleet that gives us the opportunity to mitigate that. There are also different capabilities of different aircraft, and you need different range and you need different gauge. We're weighing those against one another, and we're weighing the price and we're weighing the expected maintenance cost of the aircraft, and we're going to make the decision that optimizes profits for the long term for United. So stay tuned.

I was curious if you could remind us again how you're thinking about the fleet plan. It seems like you had a few more deliveries this year than you had planned, so Airbus and Boeing getting their act together. Curious how you're thinking about kind of 2026 and how that progresses?

Thanks, Savi. Look, Boeing is definitely getting their act together on the narrow-body side. And we're getting some additional deliveries versus what we had expected. I think that's going to continue in '26, maybe even '27. On the wide-body front, we're still seeing some delays, although there's reason for some optimism on that front as well. To the extent that occurs, we'll see additional deliveries that will drive CapEx up in the short term. But the updating on the narrow-body side, in particular, combined with the financing terms and our prices, is margin accretive, it's pretty quickly actually even return on capital accretive. So we're welcoming some faster deliveries of aircraft. As I talk about free cash conversion, we run a whole multitude of scenarios, and I feel very good about expanding free cash conversion even with growing CapEx.

Apologies if I missed this, but I think there hasn't been much talk of the government shutdown so far. If you can just help quantify what you're seeing out there? What are some of the puts and takes in terms of the range of outcomes, and whether that is your active guard building your guidance for the quarter?

Okay, I'll try. First, the controllers, despite a lot of the press, the controllers are professionals. The vast majority of the controller workforce is showing up for work. We also have more communication and coordination at all levels with the FAA than I ever have seen in my entire career. The sum of those two means that the system is actually running well. We have our most cancellation rate in a decade for October, and the second-best on-time performance. From a bookings perspective, the first couple of weeks, there hasn't really been a measurable impact in the first couple of weeks of October. Though I think the longer this drags on, obviously, the risk will grow on both of those points. So I hope our politicians will figure out how to get in the room, compromise, and get something done. Rob, to your question of an active guide, I think we calibrated the range of earnings per share for Q4 with government shutdown in mind. It's one active guard, but we've got reasonable room there for continued government shutdown, but it's not infinite.

I have a question for Andrew regarding the difference between brand loyal airlines and low-cost carriers. It seems that the booking window might be shorter for airlines like Spirit right now. Can you discuss how the capacity reduction from the low end of the market, due to their reorganization plan, will affect competitive dynamics as we approach the fourth quarter? I’m looking for any insights you can share on this matter.

Sure. I'll give it a try. Clearly, future schedules have been recently loaded that are materially different than past schedules, and unprofitable capacity is leaving the system. Certain airlines definitely have a very close-in booking curve based on pricing and how they price relative to others, I suppose, is the macro level thing I would say. Their booking curves are different than United’s booking curves because we have a full range of customers and products and flying all over the world. What it means for the future is that as more and more unprofitable capacity comes out, we'll continue to adjust. Basic economy is an entry point. There are always going to be ultra-low-cost carriers in the marketplace. They may have different names over time, and we will always be competitive with them. One thing we do think is going to change is unprofitable flying is going to be diminished because it just doesn't make sense in the long run, whether it be for United or any other carrier. We're going to make adjustments to Q3 as I reiterated earlier, and others will be forced to make adjustments. So it's a really great setup as that unprofitable capacity and that commoditized capacity leaves the system, and supply and demand rebalance to a great outlook.

We will now switch to the media portion of the call. Our first question will come from the line of Niraj Chokshi with the New York Times.

I was just curious; you guys have talked about how premium demand will be resilient in a downturn. Can you just kind of talk through a little bit more about how that is and why you believe that?

Sure. I refer to it as brand loyal demand instead of premium demand to start because many of our loyal customers are flying in economy class. While some do fly up front, a significant portion is flying in economy. I believe this demand has been robust. Many people still have the financial means to continue traveling, and travel remains a top priority for them. This includes a large number of business travelers. The higher share of business travel is what truly contributes to that resilience, and our results this year reflect that.

Scott, I had a question on Russian overflights. United said this week that restrictions on flying over Russia mean you are effectively barred from flying directly to China from Chicago, Washington, or New York. You have called for expanding a proposed ban on Russian overflights to include Hong Kong. Should this ban be included for other countries to bar their airlines from using Russian aerospace for flights to the U.S.? And the second part of my question is how much of a competitive disadvantage is it for U.S. airlines compared with other non-U.S. carriers that are currently using the same aerospace?

I'm going to focus on China. And I absolutely think this is just a matter of basic fairness. The Russian government does not allow U.S. airlines to fly over Russia. We are competing with Chinese airlines that are allowed to, by the way, a country that is supporting Russia in the Ukrainian war. A perfect example is we used to fly from New York to Hong Kong, and we cannot do it now. We're competing with a Chinese airline that is allowed to fly from New York to Hong Kong, and that just isn't right, that isn't fair. All we want is a level playing field, and I absolutely think we should get it. I appreciate that this administration is looking at the issue and focusing on the issue; it started with Beijing and Shanghai, and I hope they will continue the logical efforts and include the other large city, Hong Kong, in those efforts.

With the shutdown, is there a certain point that you think the airline could start feeling some of the impact? We heard from another airline that maybe if they went on for 10 days longer, which we're kind of in that territory now, that things could get a little bit more difficult. Is there sort of a cutoff that you see there? And then second, there are a lot of other airlines large and small that are trying to go premium now. How successful do you think that can be? And how long do you think it takes to, I guess, to go upscale in certain products?

So on the first question, the answer is we don't know. It was a little unprecedented, or at least it doesn't happen often, so you don't really know. I think that at least for the first couple of weeks, people thought it was going to get resolved, so they just kind of continued business as usual. But as time goes on, as people read headlines and say it's not going to get resolved soon, people start to lose confidence in the government and the government's ability to resolve this. That's going to start to impact bookings. So I don't know when that happens. It's not some magic step function. But every day that goes by, the risk to the U.S. economy grows. I hope we will avoid an unforced error here. And the second question on other airlines. Look, we've been doing the investment in the customer for a decade. It is billions of dollars of CapEx and OpEx. There's two ways that you can get market revenue improvements from the kinds of premium investments that people are making. One, you can get your own customer base to buy up to those products. Two, you can get market share shift. The other airlines, I think, will have some success in getting their own customers to pay more for some of their products. But the biggest upside is getting market share shift, and you're not going to get market share shift away from an airline that's been investing for a decade. Another airline getting a little bit better than they are today is not going to close the 100-point gap between United and them. So I'm going to switch my loyalty. They're going to stick with United. So I think they might have upside in their own customer base, but there's really not much upside in the market share shift part of it.

And I will now turn the call back over to Kristina Edwards for closing comments. Thanks, Mike. We will now take questions from the analyst community. We want to get to as many of you as possible, so please limit yourself to one question and if absolutely needed, one follow-up question. Regina, please describe the procedure to ask a question.

Thank you. Ladies and gentlemen, this concludes today's conference. You may now disconnect.