American Airlines Group, Inc.

Thank you for standing by and welcome to American Airlines Group's third quarter 2026 earnings conference call. Currently, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. To remove yourself from the queue, press star 1-1 again. I would now like to hand the call over to Neil Russell, Vice President, Investor Relations. Please go ahead.

Thanks, Lateef, and good morning, everyone. Welcome to the American Airlines Earnings Conference Call. On the call with prepared remarks, we have our Chief Executive Officer, Robert Isom, our Chief Commercial Officer, Nat Pieper, and our Chief Financial Officer, Devon May. After our prepared remarks, we will open the call for analyst questions followed by questions from the media. To get in as many questions as possible, please limit yourself to one question and one follow-up. Before we begin, please note that today's call contains forward-looking statements, including statements concerning future events, costs, forecast of capacity, and fleet plans. These statements represent our predictions and expectations of future events but numerous risks and uncertainties could cause actual results to differ from those projected. Information about some of these risks and uncertainties can be found in our earnings news release that was issued earlier this morning, Form 10-K for the year ended December 31st, 2025 and subsequent quarterly reports on Form 10-Q. Unless otherwise specified, all references to loss per share are on an adjusted and diluted basis. Additionally, we will be discussing certain non-GAAP financial measures which exclude the impact of net special items. A reconciliation of those numbers to the GAAP financial measures is included in the earnings news release and investor presentation, each of which can be found in the investor relations section of our website. A webcast of this call will also be archived on our website. The information we're giving you on this call this morning is as of today's date, and we undertake no obligation to update the information subsequently. Thank you for your interest in American and for joining us this morning. With that, I'll turn the call over to our CEO, Robert Isom.

Thanks, Neil, and good morning, everyone. American's third quarter revenue grew 19.3% year over year to $16.3 billion, above the high end of our guidance. excluding the years following the pandemic, that's the strongest quarterly revenue growth of my career. Unfortunately, the significant increase in fuel prices more than offset that strength. Higher fuel added $1.9 billion to our costs in the third quarter, nearly 70% more than we paid during the same period last year. We produced a loss in the quarter that, but for this fuel spike, would have been solidly profitable. but short-term pressures notwithstanding, we're moving in the right direction and with urgency. We're not satisfied with a loss no matter the reason and we will do better. The work we're doing now is laying the foundation for solid profitability as we move to 2027. Our confidence comes from the strength we see in the underlying business. bolstered by encouraging results from our commercial initiatives and delivering on our commitments, even as higher fuel prices obscure some of that progress in our reported results. We said we would elevate the customer experience, and we are. You've seen our announcements, modernizing our fleet, installing Starlink on our entire mainline fleet, expanding seatback entertainment to our narrowbody aircraft, adding premium amenities, creating and updating lounges and more. We said we would rebuild our network, and we have. We grew in Miami and Phoenix and are investing in Charlotte. We've re-banked our DFW and Philadelphia operations, producing meaningfully stronger operational and financial performance. And we've re-established ourselves in Chicago. And we're restoring our presence in Los Angeles over time. That's competitive growth we needed to do. At the same time, we're focused on achieving profitable, sustainable growth in any environment, and given today's elevated fuel prices, we now expect our growth rate in 2027 to decelerate considerably. We said we would grow premium revenue and we have. Premium generates roughly half of our ticket revenue on only about 30% of our seats and we're adding more premium seats with every new aircraft and retrofit. This is the most profitable real estate on our planes and these moves position us well and finally, we said we'd lead in loyalty and we are. Advantage enrollments and spending on our co-branded credit cards are up year over year and the Advantage program remains one of our strongest competitive advantages. The U.S. economy remains strong, supported by healthy employment, rising household incomes and significant wealth accumulation. Consumers continue to prioritize travel and recent yield strength is allowing airlines to regain our historical share of the travel wallet. In the near term, our focus is on what we can control. We continue to have industry-leading cost performance. The efficiency efforts we prioritize are producing meaningful savings that will benefit us well beyond this year. Our premium product investments are paying off both now and in the future. Our year-over-year revenue growth has accelerated every quarter this year, and we expect that momentum to continue in the fourth quarter, with revenue up 19.5% to 22.5% year-over-year. And we will adjust our capacity to support profitability as high fuel costs persist. American is taking the right actions for long-term success. Our job now is to convert all this progress into better margins, free cash flow, and an even stronger balance sheet. We expect the benefits of our strategy and the investments to become increasingly apparent, especially as fuel prices stabilize. Of course, none of this happens without the American Airlines team. And I want to thank all of our team members for taking care of our customers and each other. And with that, I'll turn it over to Nat.