Thank you for standing by. Welcome to American Airlines Group's fourth quarter 2022 earnings call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. I would now like to hand the call over to Managing Director of Investor Relations, Scott Long. Please go ahead. Thank you, Atif. Good morning, everyone, and welcome to the American Airlines Group fourth quarter and full year 2022 earnings conference call. On the call this morning, we have our CEO, Robert Isom, our Vice Chair, President of American Eagle, and Strategic Advisor, Derek Kerr, and our new CFO, Devon May. A number of our other senior executives are also on the call for the Q&A session. Robert will start the call this morning with an overview of our performance and our 2023 priorities. Derek will follow with details on the fourth quarter and full year. Devon will then outline our operating plans and outlook going forward. After Devn's comments, we'll open the call for analysts' 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 today, we must state that today's call contains forward-looking statements, including statements concerning future revenues, costs, forecasts of capacity, and fleet plans. These statements represent our predictions and expectations of future events, 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 press release that was issued this morning, as well as our Form 10-Q for the quarter ended September 30, 2022. In addition, we'll be discussing certain non-GAAP financial measures this morning, which exclude the impact of unusual items. A reconciliation of those numbers to the GAAP financial measures is included in the earnings press release, 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 the call this morning is as of today's date. We undertake no obligation to update the information subsequently. Thanks for your interest and for joining us this morning. With that, I'll turn the call over to our CEO, Robert Isom. Thanks, Scott, good morning, everyone. Thanks for joining us. This morning, American reported a fourth quarter GAAP net income of $803 million and a full-year net income of $127 million. Excluding net special items, we reported a fourth quarter net income of $827 million and a full-year net income of $328 million. Our performance in the fourth quarter and for the full year was driven by continued strength of demand and revenue environment and the incredible efforts of the American Airlines team. We're tremendously proud of what the team has accomplished over the past year. We committed to running a reliable operation, we're delivering. Coming out of the holidays, American had the best completion factor of any major U.S. airline. We also said we would return American to profitability, we've done that as well. Our team has delivered a third consecutive quarterly profit and four-quarter margins that are higher than the fourth quarter of 2019, despite our fuel price increasing by approximately 70%. We generated nearly $2.4 billion in pre-tax profits over the past three quarters, and we're pleased to report a full-year profit for the first time since 2019. In addition to running a reliable operation and generating sustained profits, we're making significant progress on repairing our balance sheet. We recently prepaid a $1.2 billion term loan a year before its scheduled maturity date, we have now reduced our total debt by more than $8 billion from peak levels in mid-2021. This puts us well past the halfway point of our $15 billion total debt reduction goal only 18 months into the program. Derek will talk more about our deleveraging plans in just a few minutes. Let's talk more about the fourth quarter and full-year results. We produced revenues of $13.2 billion in the fourth quarter, an increase of 16.6% versus 2019, and the highest fourth quarter revenue in company history. Notably, we achieved this record revenue while flying 6.1% less capacity than we did in the fourth quarter of 2019. American also produced record revenues of $49 billion for the full year, which is a 7% increase over 2019, while flying 8.7% less capacity. Demand remains strong and our revenue performance is in line with our expectations following our strong holiday performance. Post-holiday bookings are off to a strong start. In fact, this is our best ever post-holiday booking period with broad strength across all entities and travel periods. Demand for domestic and short-haul international travel continues to lead the way. We expect a strong demand environment to continue in 2023 and anticipate further improvement in demand for long-haul international travel this year. Now turning to the operation. The American Airlines team delivered a fantastic performance in the fourth quarter. We operated more than 475,000 flights in the quarter with an average load factor of approximately 84%, and we ranked first in completion factor among the nine largest U.S. carriers. Our team delivered an even stronger performance over the holidays, despite challenging conditions in many parts of the country. American outperformed the industry over the December holiday period, ranking first in completion factor. Key to our success has been sizing our airline for the resources we have available and the operating conditions we expect to encounter, and we will continue to do that going forward. We're doubling down on our efforts to run a reliable operation in 2023, including investing in our team, our fleet and technology to support our operation, and we're seeing this work pay off as our operation is off to a strong start just a few weeks into 2023. Including the best on-time arrival performance of the nine largest U.S. carriers so far this year. American is proud to operate the simplest, youngest and most efficient fleet among U.S. network carriers. In August, we began taking deliveries of new 787 aircraft from Boeing for the first time in 15 months. In the fourth quarter, we took delivery of five 787s, and we expect to receive the remaining four in the first half of 2023. Our Boeing 787-9s are expected to be delivered starting in 2024. During the fourth quarter... Oops, I'm sorry about that. Okay. During the fourth quarter, we also took delivery of seven A321neos,three E175s, and five 737-800s from long-term storage. Devon's gonna talk more about that. What I'd like to say is that the results the American Airlines team produced in 2022 and what we are projecting in 2023 are proof positive that the actions we have taken in recent years have put us in a position of strength and allowed us to take full advantage of the recovery. We spent more than 5 years on the most complex integration in the history of the airline industry, 3 years navigating the pandemic and making the airline more efficient, now we're poised to drive the business forward in 2023 and beyond. We have simplified and harmonized our fleet, modernizing our facilities, fine-tuned our network to focus on the most profitable clients, developed new partnerships, introduced new tools for our customers and team, and hired tens of thousands of people. Through it all, the American Airlines team has gone above and beyond to deliver strong operational and financial results. Before I turn it over to Derek to provide more detail on our 2022 financial performance, I wanna thank him for his partnership over the past 20 years as CFO. He's a great friend and has been a trusted advisor throughout my career. Quite simply, he's the best CFO in the history of the airline industry. His financial leadership has helped create the largest airline in the world through the mergers of America West and U.S. Airways in 2005 and U.S. Airways and American Airlines in 2013. Derek Kerr was instrumental in raising $25 billion in capital during the pandemic to ensure American Airlines would not just survive, but also be in a position to thrive on the other side of it. I'm very pleased that Derek Kerr will remain at American Airlines Vice Chair and continue to lead our American Eagle and cargo teams and serve as a Strategic Advisor to the company. As we look forward to 2023, we remain focused on running a reliable operation, achieving sustained profitability and reducing debt. We have made tremendous progress in all three of these areas thanks to Derek's leadership, we will continue to sharpen that focus with Devon May as our CFO. On behalf of the entire American Airlines team, I wanna thank Derek for his leadership and tremendous contributions to the airline as our CFO. Now I'll hand it over to Derek. Well, thank you, Robert. Thanks for your kind words. I really appreciate it. It's been an honor, tremendous honor to serve as CFO of American, U.S. Airways and America West over the past 20 years. I'm incredibly proud of what the team has accomplished in that time. On to the business of the morning. Excluding special items, we reported a fourth quarter net income of $827 million or earnings of $1.17 per diluted share. We produced our best fourth quarter pre-tax margins since 2016, when we produced roughly the same results at fuel prices that were nearly double the price per gallon lower than 2022. Throughout 2022, you heard us talk about our focus on returning the airline to profitability, we have done that. We achieved a full-year profit due to continued demand strength and the hard work of our team, despite a $1.9 billion pre-tax loss in the first quarter. Excluding net special items, we produced a full-year net income of $328 million or $0.50 per diluted share. Fourth quarter revenue far exceeded our initial guidance due to continued strong demand. Revenue in the fourth quarter was higher than any fourth quarter in company history. As Robert mentioned, the domestic and short-haul international entities continued to lead the way, and we expect further improvement in long-haul international as we continue to grow back our capacity. Costs for the quarter, excluding fuel, came in at the high end of our initial guidance range, primarily due to higher profit sharing and expense, driven by higher earnings in the quarter. American is proud to operate the simplest, youngest and efficient fleet among U.S. network carriers. In August, we began taking deliveries of our new 788 aircraft from Boeing for the first time in 15 months. In the fourth quarter, we took delivery of five 788s, and we expect to receive the remaining four in the first half of 2023. Our Boeing 789s are expected to be delivered starting in 2024. During the fourth quarter, we also took delivery of seven A321neos, three E175s and reactivated five 737-8s from long-term storage. In 2023, we expect to take delivery of two A321neos, and we plan to reactivate nine more 738s from long-term storage. Based on our latest guidance from Boeing, we now expect to take delivery of 17 737 MAX 8s in 2023 compared to Boeing's contractual commitment of 27 deliveries. This change in timings will shift planned CapEx out of 2023 and into future years. Our 2023 aircraft CapEx is now expected to be approximately $1.5 billion. Repairing our balance sheet remains a top priority, and our actions in the fourth quarter show our commitment to debt reduction. In the fourth quarter, we repaid $1.2 billion term loans secured by domestic slots. This prepayment increased estimated first lien borrowing capacity to $10.3 billion and addressed our most significant 2023 maturity. With the actions we have taken, we have now reduced our total debt by $8.2 billion, or more than half of our goal to reduce total debt by $15 billion by the end of 2025, only 18 months into our deleveraging program. We ended the year with $12 billion of total available liquidity. We will continue to balance both debt reduction opportunities and investments in the business while meeting appropriate target liquidity levels. We will target $10 billion-$12 billion in total liquidity in the medium term and intend to utilize excess liquidity to accelerate our deleveraging initiative at the appropriate time. With no meaningful maturity towers until 2025, we have the flexibility as to how and when we begin to address those instruments. I'm happy to turn the call over to our new CFO, Devon May, who will share our outlook for 2023. Devon has more than 20 years of airline industry experience across finance, operations, network planning, and alliances, and he is the perfect person to lead our finance organization going forward. He has been an integral part of our executive team for more than a decade and has built a great team around him. The CFO transition has been and will continue to be a seamless one. I'll turn it over to Devon. Thank you, Derek, and good morning, everyone. Before we get into our guidance, I wanna start by thanking Derek for his leadership over the past 20 years. I've had the privilege of working with Derek since 2002 when I joined America West Airlines. He has been a close friend and mentor during this time, and our airline is set up well for the future because of his leadership. I'm honored to be taking on the CFO role and being part of an incredible senior leadership team. I look forward to leading the finance team and building on the progress we've made on our financial priorities. For 2023, we will continue to size the airline for the resources we have with a focus on reliability and sustained profitability. We continue to expect to produce capacity that is 95%-100% of 2019 levels or up approximately 5%-8% year-over-year. We are on track to hire over 2,000 mainline pilots in 2023, and we expect to achieve our run rate level of training throughput in the back half of this year, allowing for further aircraft utilization improvements in 2024. We continue to expect regional pilot supportability to be constrained throughout this year and next. Demand for air travel strengthened as we went through 2022, and we expect industry revenue will return to its historical share of GDP in 2023. Given our level of capacity production, the strength of our network, and industry supply constraints, we expect total unit revenue to be up low single digits year-over-year. For the full year, we expect CASM-ex to be up 2%-5% versus 2022. These projections include the estimated impact of anticipated labor agreements, which account for roughly 3 points of CASM-ex fuel. For the full year, we expect to produce earnings of $2.50-$3.50 per diluted share. Using the midpoint of that EPS guidance, we are forecasting operating cash flows of approximately $5.5 billion and free cash flow of nearly $3 billion. Looking to the first quarter, we expect to produce an operating margin of between 2.5% and 4.5% based on our current demand and fuel price forecast. While we are eager to get new labor agreements ratified, given where we are at in the quarter and the time required for ratification, we do not anticipate ratifying new contracts prior to the end of the first quarter. If that does occur, we will update our guidance accordingly. In the first quarter, continued strength and demand is expected to result in total revenue for Available Seat Mile that is 24% to 27% higher year-over-year. Our first quarter CASM, excluding fuel and net special items, is expected to be flat to down 3% year-over-year. The current fuel forecast for the first quarter assumes a fuel price of between $3.33 and $3.38 per gallon and a full-year price of between $3.00 and $3.10 per gallon. As Derek noted earlier, we'll continue to focus on debt reduction, and I'm proud of the progress we have made to date. In 2023, we expect to make further progress on our $15 billion debt reduction goal. We will use our free cash flow to pay down $3.3 billion in debt amortization this year. We expect that by the end of 2023, we will have reduced total debt by $10 billion-$11 billion from peak levels in mid-2021. Based on the forecast I just provided, we expect that by the end of the first quarter, we will have lower net debt and better net debt to EBITDA than we did at the end of 2019. By the end of the year, we anticipate having the lowest net debt-to-EBITDA ratio we have had since 2017. In conclusion, in 2023, we will continue to focus on delivering on our stated objectives. We are set up to run a reliable airline, grow margins, and strengthen the balance sheet. Importantly, American is uniquely positioned to deliver substantial free cash flow in 2023. The confidence in our ability to execute on these goals is due to our world-class network and incredible team. With that, let's open the line for analyst questions. Thank you. As we open our lines for analyst questions, as a reminder, to ask a question, you will need to press star one one on your telephone. Again, that's star one one on your telephone to ask a question. Please stand by while we compile the Q&A roster. Our first question comes from the line of Helane Becker of Cowen. Please go ahead, Helane Thanks very much, operator. Hi, everybody, and thanks for your time. Derek, I'm gonna miss you, but good to know that you'll still be at the company. Thanks,. you know, sorry about Michigan. Okay. so here's- It's just business, Helane. Just business. Yeah, yeah. Here's my question actually. The first one is on CapEx. The guidance that you gave for CapEx seems low in light of the fact that you're taking four 787-8s this year. Is that a mix where it's leased versus owned in there? Hi, Elaine. Yeah, this is Devon. That is what's happening with CapEx this year. We're taking delivery of 23 airplanes. Four of those are 787s, which are direct leases. Those four are not included in the CapEx guidance. Okay. All right. That's very helpful. Just for my follow-up question, as you're thinking about long-haul international, do you see in your bookings... I think you mentioned that you think it'll improve, you know, as the year goes on. Do you see that in bookings that's already starting to occur at some point in first or second quarter? Hi, Helane. This is Vasu. Yes is the short answer. We very much see it in bookings. We started seeing it, frankly, in Q4 of last year. In Q1, we see continued strength across all of the geographies that we have, and that's continuing out into the summer. We are very encouraged by the trends that we're seeing, all the more encouraged because it is coming often at lower cost of sale and we're still filling business class cabins and things like that. That's very helpful. Thank you. Thank you. Our next question comes from the line of Catherine O'Brien of Goldman Sachs. Your line is open, Catherine. Hey, good morning, everyone. Also wanna add my congrats to Derek on a wonderful career. Just, you know, on your operational performance, really stood out during the issues the industry experienced over the holidays. You know, obviously it wasn't anything geographical considering what happened to some of your peers. Can you walk us through what you think drove it? You know, were there investments being made behind the scenes over the last couple of years that maybe just got smaller billing than the aircraft investments? Oh, hey, Catherine. Thanks. We're really proud of the operating performance. I'll tell you, it's something that, you know, we've been working on, you know, a long time. It starts with making sure that we have the resources, you know, available to fly the schedule. We don't put out a schedule that we're not confident that we can really fly. That's where we start. Yes, it's investments in so many different places. You know, we benefit from, you know, having the youngest most efficient, you know, fleet of aircraft. We spent a tremendous amount of time investing in technology to make sure that we can identify where our crews and our planes and our maintenance requirements are. Really, you know, I wanna give credit to the team here. We have so much experience on board that we're just really watchful. You know, it all came together over the holidays. The investments that we've made, the team that we have out there, making sure that we have the right schedule. I've got, you know, David Seymour here as well. He'll probably wanna add to it. You know, look, there's a lot of good decision-making going on out there too. Yeah, Robert. No, I emphasize the point you talked about, another key item here is, you know, for these storms that we've been very focused on recovery after that because it's so critical to us, and it's one that I think throughout this year we're doing better and better on, and we certainly showed that over the holidays. The key for us, along with, you know, having, you know, more new positions that we've put in that are focused when we have storms like this, we've changed a lot of our processes and procedures and how we manage these. We've also been partnering with our IT group and really enhancing some of the technology resources that we have to manage through these events because they change very dynamically and very quickly, and we have to stay in front of them. More importantly is the recovery. We started looking at the forward look of what the storm potentially could be and started building our recovery plan before the storm hit. That's where we're very focused on. Again, as Robert said, very proud of the team, very proud of the partnership with all the whole airline because it's not just operations, it's a lot of our support groups that are very critical to us getting through these. It was a great job, and we're gonna continue to improve on that. Catherine, it speaks to what we're going to be focused on going forward as well. It's still reliability and profitability here and, you know, we're gonna try to get better every day. You know, today we have, you know, another 5,000+ flights and half a million customers that we have to service. So, you know, we make it, we make it our business to take care of people every day. We're back out there in business. Thank you. That's great. That's a super helpful call. If I could just sneak one more in, maybe for Vasu. Can you just help us think about some of the assumptions that drive your full-year revenue outlook? You know, like what are the assumptions on business and international recovery? Is there an assumption in there that the industry is gonna pass on higher price of labor and fuel on a one-for-one basis? just any thoughts that drive the full-year revenue outlook. Thanks. Absolutely. I would be happy to do that. Look, first of all, in our revenue forecast, we don't assume any change to some of the fundamentals of airline demand. We presume that airline industry revenues will regain its historical relationship with GDP, roughly about 1%. We also presume the same historical relationship between revenue and fuel prices. What is very important is that as we've talked about for some time, what's different about us is that we have used the last few years to really materially change our network, our partnerships, and our fleet, and that really bleeds through in our forecast for next year. If you compare our capacity mix just in future schedules that we have published, to what we did in 2019, we've taken 5 points of capacity out of our lowest RASM, lowest margin long-haul flights, and we've grown 5 points of capacity in our highest margin, short-haul flights. Additionally, within the short-haul system, we've taken 5 points of capacity from some of our lowest performing, lowest RASM markets and redeployed it into our Sun Belt hub, which are not just our highest RASM markets, but some of the highest RASM markets, in the industry. When you think about that's 10 points of capacity mix that we've taken from truly the lowest RASM, lowest margin things and put into some of the highest margin things that are out there. You're seeing some of that trend already through 2022. That was a thing that had been in our past schedules. You see it in our quarter 1 schedules, and that drives a lot of our revenue performance. Now to put that into a bit of focus, 10 points of capacity in an airline of our size, you can think of that as the larger than just about any airline hub with the exception of DFW, Charlotte, and maybe one or two other hubs that our competitors operate. That is a material reworking of our airline network over the last few years. What's just as important is how we have done it, which is really through a significant amount of fleet simplification. We over the last few years, we've shed 50 long-haul capable airplanes, many of which were really inefficient, like the Boeing 757, the Boeing 767. We've up gauged both the regional jet and the main lines that we've got, and we've simplified the airline down to four fleet types. What that enables us to do is, in the fleet that's left, we can much more dynamically alter schedules to follow where the demand is. We can produce schedules that, as you heard David and Robert talk about, are a lot more operable and frankly, a lot more efficient. We've seen the benefits of that in our recent revenue performance, and we anticipate the benefits of that in the year ahead. Thanks. Thank you. Our next question comes from the line of Jamie Baker of J.P. Morgan. Your question, please, Jamie. Hey, good morning, everybody. you know, first, Derek, what a run you've had. Just wanted to wish you the very best from the J.P. Morgan team as you transition. I still remember hanging up on you on October twenty-fourth, two thousand and three. Apologies again for that. Hopefully, it's water under the bridge by now. Thanks, Jamie. Question for Vasu. Southwest cited passenger cancellations in book away as part of its first quarter guide this morning. I'm wondering what the benefit for American in Dallas and Chicago might look like, and whether you see share tapering back to pre-December levels in March, or do you think there's possibly a longer tail to any Southwest benefit that you might be picking up? After all, I mean, you're on time and completion factors obviously, you know, speak for themselves over the holidays. Hey, Jamie, thanks for the question. Look, we don't see any recognizable benefit from what other airlines are doing. For us, it really is as simple as when we go put the flights in places people wanna go and operate it well, the bookings come, the revenue materializes. There's really not a lot of fact that we can point to beyond that very simple truth. Okay, fair enough. As a follow-up, you, Doug wasn't shy in discussing hub profitability. You know, L.A., Miami, and JFK being the real drags on margin, D.C., Charlotte, Dallas, the obvious standouts. You know, L.A. has obviously seen some rationalization. You have NEA contribution up here in my neck of the woods. I'm just wondering whether your internal model shows the range between your most and least profitable hubs narrowing, and if so, what, you know, the specific drivers might be. Yes. The short story is, we do see an improvement in very many of our hubs as we've gone and restructured the network. In some cases, too, like, look, as you think about partnerships for us, we don't see those very differently from how we think about our own airline network. That when you put a code share flight number or a American Airlines-operated flight number, it has the same effect of creating more network for customers, and there's a real benefit for it. As much as anything, there's two things going on, that one, demographically, we see so much growth in the interior of the country. Two, what is really driving our hub profitability is for a great number of cities, American Airlines has the best network for so many customers. There's 300 cities that we serve today. In 2019, we served roughly the same amount of cities. Most of our competitors have actually shrunk the number of cities that we've served. Furthermore, within the cities that we have, in about 200 of those 300 cities, we have a material schedule AAdvantage to other airlines that operate there. That, that creates an effect that is actually really beneficial across all of the hubs in our network. Indeed, some of how we see hub profitability and how these hubs work together has changed materially through the pandemic. To my earlier comment, that's why we've restructured so much of the airline network as we have. Hey, Jamie, you mentioned Los Angeles, so, you know, I'd like to ask you to expand on that a little bit. Look, you know, in Los Angeles we're, you know, there's a limited amount of gates and, you know, let's face it, we need to use those, we need to use those in a way that's profitable. We've taken a look at that. Vasu can tell you the kind of changes we've made. Yeah, look, and in L.A., much like in New York, through our partnerships, we've been able to create something really cool for customers where, if you think about it in times past, we flew 50-seaters and small RJs in markets where we didn't really have a schedule proposition for customers. In both of those markets, take it L.A. and New York, effectively what we've done is we've turned 50-seaters, which are not particularly efficient in the long haulers, 777s that are flying a whole lot farther. We've upgauged in both of those markets materially. We've been able to use partnerships to go and offer a much broader network for customers. Now we're in this place where, lo and behold, we're adding a third L.A. Heathrow, because it's a really, to Robert's point, a very efficient way to go use gates and leverage what we've got with customers. In New York, so much of our growth is actually powered by long-haul flights that are flying within the partnerships that we have with Qatar, British Airways. The net effect of that has been really positive outside of really good financial results, which we see in our revenue trends. For the first time ever, our top two markets for AAdvantage enrollments are New York and Los Angeles. We're signing up more credit cards there. We're having growing originating market share in those places. A lot of what we've done is frankly upgauged those markets. We've gotten a lot smarter about what we do for customers, yet at the same time through our partnerships, we can offer them so much more. I'll sound like a broken record, but thank you yet again for such a thorough response. That's what we do around here, Jay. Indeed. Anything for you. Yeah. Thank you. Our next question comes from the line of Scott Group of Wolfe Research. Your line is open, Scott. Hey, thanks. Good morning. If I just look at the first quarter TRASM guide versus Q4, it implies a much sort of bigger drop than normal sequentially Q4 to Q1. Just any thoughts color there? Then I wanna kinda ask that in the context of fuel. Are spots obviously a lot higher than what you're guiding to. What's your confidence that you can recapture fuel with higher TRASM than you're already guiding to for the year? Yeah. Hey, Scott, this is Vasu. I'll start. I think Devon will finish this one out. Look, first and foremost, as we're starting this year, we have been really encouraged by demand trends. Historically, the first three weeks coming out of a holiday season are our strongest sales weeks. These first three weeks have been the strongest that we've seen in the post-merger airline. We're really encouraged by that. You see that, of course, in our TRASM guide out there. Now, what is interesting, though, is as we're building first quarter, what is different from times past, is we have been very conscious in Q1 about how we use the airline's resources. It's people, it's planes, it's facilities, everything, largely so that we can have as much of that capacity for the summer peak as possible. When you look at our Q1, we have peaked the airline a lot less than what we had historically. It's at a lower percentage of Q2 than what it's historically been, and that's really a conscious design. That is really what you see in our Q4 to Q1 change that's there, and that's sort of a unique thing. To my earlier point, we don't presume any change to the historical relationship between airline revenues and fuel prices, but Devon May may wanna add more to that too. Just really quick on your comment on fuel price. Our fuel price forecast is based on Friday's close, where Brent was trading almost exactly where it's at today, and then using the forward curve for Brent and crack spread from there. I think our forecast that we have delivered today is pretty much in line with where fuel was at, where fuel is at today. Okay. Just separately, can you just give any color what you're assuming for the cargo and other revenue, and then the non-op expense is, you know, up a good amount from the Q4 run rate? Any color there? Thank you. Yeah, this is Devon. Just on cargo revenue, we are expecting it to be down slightly year-over-year. When it comes to non-op, the largest change you're seeing in non-op is due to a non-cash pension credit that we got last year based on the prior year's market performance of our pension assets and what were relatively low interest rates. This year, we saw interest rates increase, pension assets came down. This non-cash credit that was fairly significant in 2022 is much smaller in 2023. That's something that I'm sure you're hearing from other companies and seeing in other industries. Thank you, guys. Appreciate it. Thank you. Our next question comes from the line of Michael Linenberg of Deutsche Bank. Your line is open, Michael. Oh, hey, good morning, everyone. Hey, Derek, I'm gonna miss you. I know you're gonna still be with the company, but we've had a lot of fun over the years. Yes, we have. Anyway. Thanks. Next drink's on me. Boston. Um- Boston trip. Never forget Boston. Yeah, Boston. Anyway, I have two here. If I could just start off with Vasu because I think, you know, we're trying to get our arms around, you know, the run-up in fuel and the pass-through, and I think, you know, Delta, you know, is out there sort of guiding to, you know, exceed 60% of their revenue in premium and ancillary, and I think right now they're in the mid-fifties. When I think about those revenue segments, you know, many of them come with a price elasticity of demand that's less than one. Many of them are the types of segments where, you know, you can have a fuel surcharge. Vasu, as you think about it, you know, like sort of, you know, what% of your routes maybe are subject to fuel surcharges, you know, whether they're international long haul or, you know, which ones are premium, corporate, cargo. How should we think about like, you know, in round numbers, maybe what percent of your revenue where you stand a very good chance of passing on 100% of the rise in fuel? Sort of where do you sit there, and just any color on how you guys think about it? Yeah. Hey, Mike, it's a great question. Look, I would actually even simplify it further. Look, in the airline network business, if you can offer something unique to the customer, they pay you a premium for it. It is as simple as that. We see it time and time again. We've seen it through the pandemic. The most unique thing we can offer customers is to take them to places where our competitors can't at better schedules than what our competitors can do. As long as that's the case, we find that those routes, regardless of whether customers purchase a transaction which is first class or economy or fly for leisure or business, they always have yields that index to the top of our system. If you think about us, right, to my earlier point, in 200 of the 300 cities that we serve in the Western Hemisphere, we have a material schedule AAdvantage. When you look at it on the number of origin and destination markets that we make, that turns into like 65%-70% of our origin and destination markets, we have a material AAdvantage over what our competitors are. That is what drives our revenue performance. Unsurprisingly, demand at large for the airline product is relatively inelastic. In so many of those places, it is inelastic. We're also further benefited by just general trends that we're seeing, that so much of what is driving the economy and likely to continue to do so are markets in the Sun Belt and the interiors of the country, and less so the coastal markets, which creates an immediate benefit for American Airlines. We're benefited from that. We're benefited from how we can uniquely serve it, are likely to continue to be able to uniquely serve it. When fuel prices rise, it's a really simple thing for us. Like, we have any number of ways to go and manage capacity down so that the airline continues to produce. Very good. Just, second question to Robert all the talk about capacity constraints across the aviation ecosystem. As I think about American, it feels like things like pilots and mechanics, you know, maybe that's not an issue. If you sort of think about, like, what are the big hurdles that you have from a constraint issue, and is it just that maybe you don't have enough wide-body airplanes and therefore, you know, it's an issue with the OEMs delivering the airplanes that you need? Is it air traffic control? Like, where are the roadblocks that you're running into with respect to, you know, constraint in the aviation ecosystem? Thanks for answering my question. Hey, Mike, thanks for that. Yeah, we're in a environment of a lot of constraints coming out of the pandemic. We certainly saw, you know, everything, you know, last year. It's just things that we never thought we would have issues with, you know, pillows and blankets and food and, you know, fuelers and things like that. You know, we've gotten our arms around a lot of that. What we have now is, you know, aircraft manufacturers that are just starting to get their feet back under 'em. I mentioned that, you know, Boeing is starting to deliver aircraft. A shout-out to the Boeing team and Dave Calhoun. We need them to keep it up. You know, there's constraints out there in terms of, of engines and aircraft. You know, at American right now, we have, you know, really an issue with regional aircraft and then some issue with mainline aircraft. On the regional side, it's largely a pilot constraint. You know, we're not flying the fleet that we'd like to. You know, Vasu would actually like to deploy more aircraft. On that front, it's pretty explainable. It's just a shortfall in pilots. We didn't attract people into the business for a couple of years, we're working our way through that as we have retirements that are coming out the other side. American took the monumental step last year of greatly increasing regional pilot pay. I think that that is the biggest thing that any, you know, company can do and has done to actually, you know, get the pump primed and people flowing back again. We're seeing that. We're seeing that, you know, that we've stabilized the pilot ranks at our regionals, and we see potential growth as we come through the end of the year. Now, from a mainline perspective, you know, look, we're going through the greatest training cycle of pilots that we've ever experienced. We had, I think, almost 900 retirements last year, probably, you know, nearly the same number this year. We're stretching our training resources like we've never before. Fortunately, we planned for this. Mm-hmm. You know, an equipment perspective, like simulators, we've got those in place. One of the things that we're really working on is to make sure that we have the people resources and having the check pilots that we need to really address all of our training needs. I'm hopeful that as we work with the APA and we get a new contract, that we'll be able to get even more flexibility. Overall, I do see from a mainline perspective, we should be through, you know, the constraints that related to pilots as we progress through the year. Regionals probably take, you know, a couple of years. As we've said, we have aircraft that we can deploy and will, and it's gonna be done in a very efficient fashion. You mentioned some other areas that are absolutely positively, you know, out on the horizon. You know, the large airports, you know, all have, you know, constraints, whether that's at the gate, you know, or out on the airfield. We have airspace issues that, you know, clearly, we need to address. That's going to take leadership. Fortunately, we're working with the DOT and FAA, I know that Secretary Buttigieg has an interest like we all do in making sure that we can invest for the future. It's gonna take, you know, a long-term view. Overall, look, I'm, these constraints right now are things that we're managing through. I think it, you know, bodes well, at least from a, you know, a demand environment and, you know, being able to, ensure that we can achieve profitability. Over the long run, you know, we're gonna make sure that we have a business model that, works in any demand environment with any set of constraints. Great. Great. Thanks, Robert. Thank you. Our next question comes from the line of Conor Cunningham of Melius Research. Your line is open, Conor. Hi, everyone. Thank you. Congrats, Derek and Devon. It's great to hear. Just on back to Jamie's question on the operation and, you know, maybe some of the Southwest issues. I'm just curious if you could speak to how your conversation with your corporate partners has evolved, given your just operational strength. Like, I would imagine it would be a lot easier these days, but can you just talk about how that's changed at all and what your expectation is for new contracts and so on? Thank you. Hey, Conor, I'll start, and I'm gonna hand it straight off to Vasu. I'll tell you what, one thing that, you know, hasn't changed is that reliability, you know, it translates into likelihood to recommend. It translates into net promoter scores. We see it, you know, over the holidays and as we really progressed through last year and got, you know, reliability to, you know, a really high level. You know, our scores have improved to the highest levels that we've seen. Those are the kind of things that I think that our corporate customers are interested in as well, Vasu. Yeah. That is Robert's 100% right. First, I'll say for our customers at large, they clearly benefit from a better operation, and we see it. For the year, we, as Robert said, we posted our best likelihood to recommend scores, by a meaningful amount, in any time post-merger. That's no accident. That is the operation. Look, what's really important out there is, yeah, many of our corporate partners are encouraged. What's really important, and this links back to some of the other questions, is that also the marketplace has changed very meaningfully. As I mentioned on our last call, we see the same trends where roughly, 30% of our revenues are coming from what we've historically called leisure. About 45% are blended trips. Only about 25% are what we've historically called, business trips. Of that 25%, historically, that number would have been about 35%, so it's shifted a lot. Within the 25%, only about 5 to 7 points of that are coming from contracted corporations. The rest are non-contracted, unmanaged businesses who are flying on us. What we see amongst those contracted corporations is quite striking. Almost two-thirds, to 75% of our corporate contracts are actually not fulfilling, the terms of their contracts for understandable reasons. Um, for so many companies, if you're struggling to bring people back to the office, it's hard to compel them to go do a day trip to Chicago or New York. Uh, and so we, we, we see that broadly. And so even though, uh, many customers, um, are happy with our service, uh, and many corporate travel buyers are very happy with our service, um, the reality is, uh, same-day corporate business trips, which used to be three to four percent of our traffic, is less than one percent of our traffic. And that's been out there for a while, and, uh, we are planning that that's gonna be the new norm. Okay, great. That's awesome. Then you're talking about free cash flow again, that's obviously great to hear. I'm just curious how your, how your expectation for future aircraft deliveries has changed. Should we expect that we're gonna start paying cash for these planes going forward? I realize that your CapEx budget's lower, but just curious on how you're thinking about financing those aircraft in the future. Thank you again. Bye. Yeah, this year is a low point for aircraft CapEx. We'll see it come up a little bit next year and then get back to more of a run rate type capital expenditures as we get out into, you know, 2024, 2025. In terms of financing, it's gonna be dependent on where the market is at. Yeah, there's potential opportunity that we may pay cash for some airplanes, but it's dependent on what sort of free cash flow we are delivering and what sort of market rates we're able to achieve. Okay. Thank you. Thank you. Our next question comes from the line of David Vernon of Bernstein. Your line is open, David. Hey, good morning, everyone. Robert, I wanted to ask you about, you know, how we're exiting 2023 on the cost side. You guys have been running a pretty clean operation and the margins are obviously pretty healthy. I'm just wondering how much baggage are you carrying in the 2023 outlook from, you know, lower productivity, more full training classrooms? Is there a way to think about, you know, what that penalty would be from a unit cost perspective, because of some of those lingering effects of restoring the network embedded inside of the 2023 guidance? I'm gonna ask Devon to help me out. David, I would tell you that I think the biggest issue that we have right now is we have aircraft that we could be utilizing at a much higher level. You know, absolutely, positively, you know, we're going through some training cycles that are just unprecedented. The hiring that's going on at American right now, that is going to over time, you know, stabilize, and we won't have to work those assets quite as hard. Biggest thing right now is aircraft. Devon, do you wanna give some numbers on what you think that? Yeah. I'd just say for aircraft utilization, we are just starting to approach historical levels. We're just starting to approach our 2019 levels of aircraft utilization as we get through this year. Like we've talked about, this is a fleet that should be able to produce higher aircraft utilization than the fleet we had prior to the pandemic. Just recall, prior to the pandemic, we had a lot of older aircraft, smaller sub fleets that had really high spare ratios. Even though we will likely put more into operational support than we would've planned to a year or two ago, we still think this is a fleet that can produce significantly higher utilization than what we're doing today. Okay. I mean, the leverage on the aircraft ownership cost is pretty straightforward. As you think about increasing that utilization, can you talk about the impact at the margin on costs in things like labor and the rest of the business? I'm getting a lot of questions about scalability and how unit costs should be moving as we're thinking about not just 2023, but also 2023 into 2024. Any added color there would be helpful. Yeah. I think just as Robert said, there's certainly some more operating leverage in the business. You know, if you're asking specifically about the salary line or the training headwinds, I think that is absolutely a part of it. You know, as we get through this year, and get our training throughput to a level that it should be at, I think we are gonna see some efficiencies on that side. You know, through the rest of the P&L, yeah, there's opportunities as we increase aircraft utilization in areas like airport rent and landing fees, and that type of thing. In maintenance. When you have, you know, aircraft that, you know, sit on the ground, especially within our regional fleets, it's not as if those don't require maintenance. You know, look, the fleet is meant to be flown. Whether it's, you know, things like, you know, rents and landing fees, maintenance, those are the areas that I would probably look to, you know, most as being, you know, opportunities for us to see much greater efficiency. All right. Thanks for that. Then one last real quick one. You know, free cash flow should be something like 130% of net income in this, based on the guidance today. As you think about the go forward look, I'm just curious about whether you're able to use the loss of the last couple of years, how long is that gonna affect sort of cash taxes and when do you, when do you think, you know, cash taxes are gonna start to become a part of the equation here? Is that a 2024, 2025, 2026 thing, or is that a, you know, like any sense of when that might kick in? We don't expect to be cash taxpayers in that period for at least through 2026. Okay. Thank you. Thank you. Our next question comes from the line of Andrew Didora of Bank of America. Your question please, Andrew. Hi this line-. Andrew. Andrew, your line is open. Hey, good morning, everyone. It's Andrew Didora. Just in terms of the balance sheet and the debt pay down, of the $8 billion of gross pay down done thus far, am I doing my calculations right? There's about $3.5 billion of that coming from the pension. Of the $15 billion kind of total gross debt pay down number, how much of that do you assume is just a reduction of pension benefit? Yeah. That is the right calculation. In the summer of 2021, when we had historically low interest rates, our pension obligation was obviously significantly higher. It's sitting around $2 billion at the end of 2022. By the end of 2025, where we've set our $15 billion goal, it's still right around that number, maybe a little bit lighter, based on expected asset returns and the pension contributions we're gonna make. Got it. I know you've answered a lot of questions in terms of asset utilization, hiring and things like that. As you sit here today for your 2023 capacity plan, do you have the pilots and the aircraft in-house to hit that plan, or does the plan require additional hiring and, you know, additional kind of deliveries from the OEMs relative to plan in order to hit that capacity goal? Thanks. We will be hiring pilots throughout the year. We feel really good, though, about the hiring forecast we have and what we're expecting for training throughput. In terms of deliveries, as we talked earlier, we do expect to take 23 aircraft this year. Those deliveries would be required to hit this plan. I think we've taken a pretty conservative approach to what we have for in-service dates, and we feel like this is a plan we're going to be able to hit. Yeah. Andrew, that's, look, as Vasu and Devon did get together to build the network and work with David Seymour on, you know, our operating capacity, you know, we're being really mindful of making sure that we have the resources to fly the schedule. There's a confidence factor that, you know, we're using in that as well. Okay, that makes sense. Makes sense. Thank you. Thank you. Thank you. Our next question comes from the line of Duane Pfennigwerth of Evercore ISI. Your question please, Duane. Hey, good morning. Thanks. Congrats to Derek and Devon. Just to follow up just where you left off there. I think at one point last year, I believe you paused mainline hiring because of the pilot training throughput and the pilot training lead times. Can you just mark-to-market, like did you restart hiring? When did you restart hiring, and how many incremental do you need to hire to hit your growth plan this year? Yeah. We were hiring ahead of needs and training throughput as we got later in the year. We did pause hiring for most of the month of December, I believe. That hiring has resumed here in January. Our expectations are we're gonna hire around 2,000 pilots for this year and probably a little bit on the higher end as we get through the year and training capacity continues to increase. Okay, thanks. Just, you know, most of my questions have been asked, but just an aircraft financing question. You know, hypothetically, if you had $100 million in aircraft CapEx, and you know, you debt finance that, you know, where do you see LTVs? Is it, you know, is it $80 million or $85 million that would go on the balance sheet? Where do you see LTVs and cost of debt today? Alternatively, if you lease that $100 million of gross CapEx, how much would go on the balance sheet in the form of an operating lease liability? Okay, there's a lot to that. I'll just say our treasury team right now, we have 23 deliveries, 12 of which are already financed. Our financing requirements for the remainder of this year are pretty limited. Those are all the factors they're gonna be looking at, is what sort of rates are embedded in the operating leases that are in the market today, what sort of LTV we can get on the debt, what's happening with the rest of the balance sheet and our free cash flow, they're gonna make the right economic decision. We have a great treasury team. They're looking at these remaining nine aircraft we need to finance for this year and looking out to 2024 as well. Okay. I mean, fair enough. It's, it's not like if you will or if you won't, it's, you know, if you do debt finance $100 million in CapEx, you know, where is the market in terms of that LTV and cost of debt today? It's something that obviously we expect is going to move around over the next handful of months. I don't have a number that I'm ready to give right here today, but it's something that we're gonna stay tight with, and we have a team that knows the market well. Okay. Thank you for taking the questions. Thank you. Our final analyst question before we open the line to media, comes from Ravi Shanker of Morgan Stanley. Ravi, your line. Good. Thanks. Morning, everyone. One short-term and one long-term question. The short-term question is kind of it's good to hear that you said you're having your best ever post-holiday booking period so far this year. Can you just expand a little bit more? Are you seeing any changes in customer behavior? Are they flying to different destinations? Are they looking to, maybe kind of, you know, downgrade their tickets or look for more flexibility? Kind of any signs at all of,, any change in customer behavior or kind of again, where macro is? Yes, we are seeing some changes in customer behavior. People are especially leisure travelers are booking even further out. We see that the blended customers are also much more willing to book further out. Third, we see that customers, especially blended customers, or people purchasing a blended trip, are more willing to buy higher value fare products and shop direct with us. We continue to see a world where roughly 60-ish percent of our revenues are coming direct to us through our dot-com and mobile app, and we see that continuing to grow. Furthermore, as those blended trips come in to our, as we call them, own channels, 70% of the people shopping for the lowest fare end up buying a higher fare than that. We're encouraged by that. As far as where people are flying, I suppose that's pretty simple too. They're flying everywhere they possibly can except for places in Asia. That's great to hear. Thanks a lot. Maybe just to follow up, you guys have come a really long way, kind of in the last year, kind of since where everyone was during the pandemic, but the markets may be not recognizing that. I'm wondering if there's any plan to kind of host an analyst day to kind of give us a long-term plan on strategic priorities, long-term financial guidance and such. Hey, Robbie, thanks for that question. The answer to that is, look, we've been really pleased with the work that we've done throughout the pandemic in setting American up. The answer to your question is yes. We're going to, you know, get out and make sure that people know our story. More details on that as time progresses, you'll hear more from us on that. Very helpful. Thank you. Thank you. At this time, we'd like to open the line to our media questions. As a reminder, to ask a question, you will need to press star one one on your telephone. Again, that's star one one on your telephone to ask a question. Again, our line is open to our media questions. Please stand by while we compile the Q&A roster. Our first question comes from the line of Mary Schlangenstein of Bloomberg. Your line is open, Mary. Hi. Thanks. Good morning, everybody, and congratulations to Derek and Devon. Hey, I wanted to ask a couple of business-related questions quickly. On your business travel, whether it's corporate managed or not, do you anticipate any impact from the growing number of companies that are laying off workers, particularly in high tech, but also now extending to some manufacturing companies? My second question is your expectation that this shift to blended trips is in fact a structural change within the industry and will not diminish going forward in terms of at least as far out as you can see? Thank you. Hey, thanks, Mary. This is Vasu, I'll answer the questions in reverse order. First, look, we do see a meaningful change in the trip purposes that people are booking, that there's a lot more blended trips. Even so many people who are searching for what conventionally would have been a business-style itinerary, we see it in our dot com, end up selecting something which is pretty unconventional, where they, you know, stay a Saturday night or they book another person for a midweek trip or something like that. We do see that. Our credit card partners at Citi see the same thing too, that demand for travel is still a really strong category and travel at large has preserved its relationship with GDP, if not somewhat grown a little bit. There is a meaningful thing. We're coming out of the pandemic. There's clearly a value the consumer is placing on travel. As far as how layoffs are impacting things, what's really important to note about business travel is, yes, it's 25% of our revenues, but those companies that are tending to do the largest of them, the biggest, largest ones tend to buy on a corporate contract. That's so much of that business just really hasn't recovered, and we haven't built an airline plan around it. However, non-contracted business is 100% recovered. Contracted business is about 75% recovered. We don't presume that it grows much further than that. We aren't seeing a really significant impact, but we also aren't building a plan, based on a lot of that demand returning. Is that 75% recovery for contract, is that down from prior estimates? I thought that you had said perhaps 80% in the past. No, it's hovered in the... Sorry, Mary. It's hovered in the 75%-80% range. To be conservative, we build our plan around the lower end of that. Okay, that's revenue? Correct. Okay. Thank you. As a% of IT. Thank you. Our next question comes from the line of Leslie Josephs of CNBC. Your line is open, Leslie. Hi. Good morning, everyone. Thanks for taking my question. Curious if what your hiring needs are outside of the unionized groups, like the offices and if you're seeing anyone apply or maybe you can benefit from some of the tech layoffs. Secondly, with your plans to do this high J configuration cabin, are you planning to increase staffing at all of cabin crews to kind of handle the more high-touch service and more passengers in that cabin? Thanks. Hey, Leslie. I'll start, and Mecole Brown, our Chief People Officer can help me out. Look, the hiring at American is really, you know, at unprecedented levels. You know, you mentioned our pilot hiring. Yes, we, you know, anticipate 2,000 pilots this year. Over the last 2 years, Cole will correct me, I think we've hired almost 40,000 people. Yes. Which is across all groups. We have a view that we're gonna bring folks in, make sure that they're really well trained, but it really is throughout all of our operations and headquarters and administrative staff. We're gonna bring the best and the brightest in. Cole, you wanna add anything to that? Robert, I would just push what your point said. We are taking a hard and thoughtful look as it relates to any hiring outside of operations, making sure that we're bringing in the best and the brightest, but also that we're thinking through not only what our needs are today, but where we're going tomorrow. Some of those skill sets might, you know, evolve and change. We have an exciting new CIO that's come on board and is taking a really important look at our IT organization. More to come. Right now we feel like we are focused on the right things and being very thoughtful and measured in where we are hiring at the corporate level. It's certainly the focus of the areas that we've previously discussed with you all. Got it. Thanks. On staffing, for the Hijj. Hey, this is Vasu. We're really excited for the new high J product. Our customers love our new business class, and we've gotten great feedback as we've shared concept designs with some of our most loyal customers and our flight attendants. We haven't yet determined a number of things with how it operates, where it operates, things like that too. It's a little bit premature right now. Okay. Thank you. Thank you. Our next question comes from the line of Claire Bushey of Financial Times. Your line is open, Claire. Hello. Hello. Thanks for taking my question. I was wondering if you're at all concerned about new regulation in response to perceived increasing unreliability of air travel. Hey, Claire, I'll just start. Look, our primary focus is on making sure that we run the best airline we possibly can. That's the way that, you know, ultimately we address customers' needs and ensure that, you know, our customers are being treated fairly. Of course, you know, we'll work with, you know, government authorities to make sure that, you know, we're taking care of people in the right fashion. Nate, do you wanna add anything? No? Good. Okay. Thank you, Claire. Thank you. Our next question comes from the line of Doug Cameron of WSJ. Doug, your line is open. Doug Cameron, or is there another Doug? Go ahead, Doug Cameron. Okay. Thanks. I got a hugely loaded question for Devon and Derek, and a super quick follow-up for Vasu, if you'll let me. The loaded one. You must be relieved that you don't have to finance 100 planes this year, given where interest rates are and the vagaries of supplier delays. Just on that latter point, what sort of complication does the, you know, the uncertainty over when you actually get planes, as opposed to contractually getting them, what does that do to, you know, your ability and choices for aircraft finance options? Well, you're right. I am happy that we're taking 23 airplanes and 12 of them are already financed this year. I will say, you know, we did go through a huge wave of investment prior to the pandemic. Over that period, I think that the timing is obviously fortunate. We were in a nice economic environment, a really good environment for financing those airplanes. As we look out to this year, I don't think the timing of the deliveries as it sits today is too concerning with how we're gonna finance the airplane. More than anything, we just wanna make sure the airplanes are delivered and in schedule so we can run a great operation and have really solid schedules for our customers. What we've done on that front is we have planned conservatively with in-service dates that we believe are coming in far later than when we'll actually take delivery of the airplanes. That's something that's gonna be really great for our customers. Yeah. We continue to work with both Airbus and Boeing to make sure that we encourage them in an appropriate fashion to deliver on time. You know, I know that they're working hard to make sure that they can meet our needs. That's great. Just as I say quickly for Vasu. Vasu, are you seeing any kind of skirmishes on the fare and scheduling or scheduling front, just given, how competitive capacity trends are going? Is demand just that strong that you ain't seeing anything anywhere? Hey, thanks for the question. We don't comment on fare and competitive scheduling trends. I will say we are really encouraged with the demand trends that we see and are very confident in the airline we've set up to go and take care of our customers along the way. Fair enough. Thank you. Thank you. Our next question comes from the line of Kyle Arnold of Dallas Morning News. Your line is open, Kyle. Hey. Thanks so much. You've had some cuts at the regional level of service to some smaller cities. What's your strategy behind the regional served locations right now? Do you think there'll be further cuts as we continue to go through this pilot shortage at the regional level? Hey, hey, Kyle. I'll just start on this. Look, it's really unfortunate that we've had to reduce service anywhere. You know, most, especially to some of the smaller communities. That's solely a result of, you know, the issues that we faced with pilot staffing at our regional airlines. As I mentioned before, we're working really hard on it. American, I think, has taken the biggest step to get people into the industry of anyone, and I know others have followed us there. That's gonna have an impact. We've seen the benefits of those efforts, and we're stabilizing the fleet, and I think that we just grow back from here. Is there any outlook on how long there might be constraints at that level? You know, I think from a regional perspective, you know, it takes, you know, time to get people back into the industry. But again, for anybody that, you know, is listening and reading, it's a great time to come into aviation. You know, these are careers, or pilot careers are ones that can be, you know, great quality of life and also, you know, very lucrative as well. You know, I think it's an opportunity that as we look to the future, that there are communities that haven't typically been places where we've sourced pilots that we're going to look to in the future. We're showing great progress in, you know, hiring pilots of color and also female pilots. I look at that as an opportunity going forward that's gonna greatly benefit and really change the face of our flight crews. Really looking forward to it. I think it's something that's probably, you know, over the course of the next 2 years. Thank you. Our next question comes from the line of Ted Reed of Forbes. Your line is open, Ted. Thanks for taking the question. My question is for Robert. Robert, we've been hearing you say for a long time that you're gonna make a reliable airline and a profit-profitable airline, and you seem to have done that this year or last year. Now I wanna know, what is the vision for the future? Can American be restored to being the greatest airline as it once was perceived? Do you have a path to do that now that you've started to accomplish your other goals? Well, hey, Ted, great to hear from you. you know, let me just start with this. I'm really pleased with, you know, three profitable quarters and producing a profit, you know, for the full year in 2022. The things that we've talked about doing are the right things. you know, getting customers to where they wanna go, having the broadest network and doing it in a fashion that can produce profits, pay down debt is exactly where we need to go. Off of that platform, I see great things. What you're going to see from us, as certainly in the near term, is more the same. Intense focus on reliability, profitability and accountability. For our customers, that's gonna mean we're gonna deliver for 'em. Deliver with the best network that Vasu has talked about, making sure that we have a travel rewards program that's best in the industry. We're gonna operate with excellence, it's going to require even greater planning and day-to-day execution. When things don't go right, and let's face it, we're in a business where all sorts of things can happen, we gotta be the best at recovering, and you're gonna see us continue to invest in that. Along the way, we have, you know, the opportunity to really make better use of technology to further digitalize our operations and our customer experience. Ganesh Jayaram, who's our new CIO, has been charged with executing exactly that and ultimately put this all together in a business model that is incredibly efficient, improves margins and reduces debt. That's what we're focused on right now. I wanna keep the team with their head in the game every day and really excited about what that means for the future, 'cause I do think it means that American is not just more competitive, you know, out in the marketplace, but we're gonna be more competitive, in terms of stock performance as well. All right. Let me just ask a follow-up to that. When you look back at the history of the industry, the people who've been considered the greatest leaders have been the ones who've expanded the airline, Wolf, Crandall. Going forward, I don't mean right away, but over the years, can this airline expand maybe more in Asia or places where you're perceived as weak? Hey, Ted, just first off, just in terms of ego around here, you know, look, we are focused on business and really making sure that we have the capacity, you know, to address the opportunities in the marketplace. American's been around for 96 years now. We're coming up, you know, on our 100th anniversary in 2026, and I want American to be the airline that meets the needs of our customers, our communities and our shareholders as well. We're focused on that right now. you know, look, we're really encouraged by what we're seeing. All right. Thank you, Robert. Good to hear from you, Ted. Thank you. That concludes the media Q&A. I would now turn the call back over to Robert Isom for closing remarks. Thanks for, thanks for that. Thanks, everybody, for listening in. Look, American's in a position of strength, especially as we take a look at coming out of the pandemic. We're poised to recover. We're gonna focus on our goals, reliability, profitability, making sure that we reduce our leverage and put American in the position to take AAdvantage of opportunities that come about. We're really encouraged by the results and excited about the opportunities ahead. Thank you very much. This concludes today's conference call. 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