Surf Air Mobility Inc.

Thank you for standing by my name is Kate and I will be your conference operator today at this time, I would like to welcome everyone to serve air mobility second quarter 2025 earnings call. All lines have been placed on mute to prevent any background noise after the speaker's remarks, or there will be a question and answer session. If you would like to ask a question during this time simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star 1 again. Thank you. I would now like to turn the call over to Sam Levinson. Please go ahead.

Thank you, Operator. Welcome to Surfing Mobility's second quarter 2025 earnings call. I'm joined today by Deanna White, Chief Executive Officer and Chief Operating Officer, and Oliver Reeves, Chief Financial Officer. Our earnings release can be found on the SEC EDGAR website and on our SURF Air Mobility investor relations page at investors.surfair.com. During this call, we will discuss our outlook and expectations for future performance. These forward-looking statements may be preceded by words such as we expect, we believe, we anticipate, or other similar statements. These statements are subject to risks and uncertainties, and our actual results could differ materially from the views expressed today. Some of these risks have been set forth in our earnings release and in our periodic reports filed with the SEC. During today's call, we will present both GAAP and non-GAAP measures. Additional disclosures regarding non-GAAP measures, including a reconciliation of GAAP to non-GAAP measures, are included in the earnings release we issued earlier today, posted on the Surf Air Mobility Investor Relations website, and in our findings with the SEC. I will now turn the call over to Surf Air Mobility CEO, Deanna White. Deanna?

Thank you, Sam, and thank you to everyone who has joined our call today. I am extremely pleased to update our shareholders on the exceptional progress that the Surf Air Mobility team has achieved to completely transform our company. As the financial and operational results of the second quarter demonstrate, we are making phenomenal progress. These achievements for the quarter and year to date are the outcome of a deliberate and focused plan to strategically rebuild surf air mobility. The result will be a company leading the regional air mobility market, built for speed, flexibility, and software-first performance. Here are some highlights of the achievements we have made toward our transformation. Beginning with our airline operation, in the past six months, we have substantially augmented our leadership team. moved our Systems Operations Center to the Aviation Hub of Dallas, hired amazing talent throughout the organization, implemented new processes, benchmarks, and standards powered by technology, and successfully aligned our organization around focused execution. These efforts are paying off in operational, commercial, and financial ways. We substantially improved all our key operating performance metrics, including on-time departure, on-time arrival, and controllable completion factor by double-digit percentages as compared with the prior year. We achieved profitability in our airline operations for the second quarter, keeping us on track toward our goal of profitability in our airline operations for the full year. We signed an interline agreement with a fifth major carrier, Japan Airlines, which can provide significant passenger flow into our Hawaiian route network. And we renewed an essential air service contract for Kalaupapa Hawaii during the quarter and for Waimea Hawaii in July, which represent a combined $14 million total contract value spanning four years. Turning to our on-demand business, in the first half of 2025, we have recalibrated this business through a relaunch of our brand and product portfolio. We are running this business utilizing our broker OS software platform. Our hyper focus on product profitability has led to the introduction of an industry standard jet card and a shift to a larger cabin sales strategy. To improve the unit economics of our offering, we signed volume purchase agreements with two operators, each beta users of the Surf OS software platform. These efforts have resulted in improvements in flight margins and positive margins for the on-demand business in the month of June. The success of our brand and product relaunch has resulted in July being our highest sales month since the inception of this business. Lastly, our path to commercialization of the Surf OS software platform is advancing as planned. We are building Surf OS powered by Palantir to be the backbone of a smarter and more modern regional air mobility system. Palantir is more than just powering our software. They are our largest shareholder. Our software platform isn't a thesis. It's already in motion in our business and with beta users who have signed on to evaluate the system. Real-world stakeholders like ourselves are actively engaged in shaping the platform's core modules and are providing direct operational feedback. Many aspects of the platform are driving the commercial and operational performance of our air operations and on-demand businesses. SurfOS has replaced spreadsheets and PDFs with a fully integrated aviation stack powered by live flight data and real-time decision-making. Some features of BrokerOS recently launched include a sales quote lead form and mobile app which enables charter operators to accelerate boat creation and improve conversion, integrations to increase charter supply and improve accuracy of pricing and aircraft availability, and consolidated charter supply sourcing to enable personalized offerings and provide intelligent charter aircraft recommendations. Some features of Operator OS we have introduced include a flight and cruise scheduling tool developed with Palantir to help optimize flight operations, and fully integrated flight docs to help streamline our maintenance processes. We have completed a parallel test of the Operator OS flight and cruise scheduling tool in the eastern region of our network, which was reviewed by the FAA. We are in the process of rolling this tool out across our entire network. This initiative will be completed by the end of the year. The company and Palantir entered into a five-year software license agreement as an expansion and enhancement of the overall relationship between the two companies. The company will be Palantir's exclusive partner with respect to the configuration and sale of software to Part 135 operators and charter brokers. The company will have the ability to sub-license certain of its rights under the agreement to third-party clients. Lastly, the agreement contemplates the company and Palantir teaming to bid on software development projects for Part 135 operators and brokers, aircraft manufacturers, and the FAA. Our achievements demonstrate improvements across all areas of the business. We set out to transform our company, and we are winning. The culmination of all these achievements led us to outperform our financial guidance for the second quarter. Second quarter revenue of $27.4 million exceeded the company's guidance of $23.5 to $26.5 million and rose 17% sequentially versus the first quarter, with scheduled service revenue rising 20% and on-demand revenue rising 5%. The increase in scheduled service revenue is directly correlated to improvement in our controllable completion factor from 82% in the first quarter to 95% in the second quarter. On-demand revenue benefited from our increased focus on profitable bookings. Adjusted EBITDA also exceeded our expectations. Our adjusted EBITDA loss for Q2 was $9.5 million. outperforming our guidance of a loss of 10 to 13 million. The loss improved by 4.8 million sequentially as a result of the improved performance in both our scheduled service and on-demand businesses. Another significant achievement during the second quarter was raising approximately 45 million in additional capital. This infusion of capital has helped to accelerate the pace of positive change in our operations and in our organization. We are witnessing warp speed achievements delivered by a new management team enabled with new capital. Surfer Mobility is more than just an airline. We are a technology-led organization that will transform regional air mobility. Our SurferOS platform will empower the regional air mobility market to capture efficiencies and growth through network effects. We are positioned at the forefront of the fast-growing regional air mobility market. providing exclusive access to a leading software platform powered by Palantir. In 2025, we are optimizing our operations and setting ourselves up for growth. In 2026, we will expand our scheduled service network with new Tier 1 routes and aircraft from Textron Aviation. We are already hard at work on detailed launch plans for the routes we intend to unveil next year. We are scheduled for delivery of two new Cessna Grand Caravan aircraft in each of the first and second quarters of 2026, and we are pursuing future deposits on deliveries for the second half of 2026. We recently introduced three flagship products on our ServOS software platform, BrokerOS, OperatorOS, and OwnerOS. We have secured LOI agreements with six clients to purchase these products ahead of the commercial launch. These LOIs illustrate expanding interest in the SurfOS platform and a clear step toward commercial rollout in 2026. As mentioned in our first quarter earnings release, the company is actively pursuing the creation of one or more ventures or partnerships with key vendors to separately capitalize the company's electrification efforts. We continue to work with third parties in the electrification space. We have a bilateral agreement with Electra, an advanced aerospace company, building a hybrid electric ultra-short aircraft to bring their EL-9 nine-passenger aircraft to market and incorporate SURF-OS into joint systems. We participated with Electra last month at Virginia Tech during the first commercial flight demonstration of their ultra-short takeoff and landing EL-2 prototype aircraft. Surfer Mobility previously secured preferred delivery positions for 90 electric ultra-short aircraft. Surfer Mobility is positioned at the intersection of numerous growth sectors across air mobility, technology, software, electrification, and AI. We have unique and exclusive relationships with Palantir and Textron Aviation, We have years of experience flying millions of passengers millions of miles. We have a leadership team steeped in aviation technology and software experience. We are uniquely qualified to win, and we have the right team to do it. I have never been as excited about the company's opportunities as I am today. With that, let me now turn the call over to Oliver to cover our Q2 results, our capital raise, and our outlook for the balance of this year.