Thank you for standing by, and welcome to American Airlines Group's fourth quarter and full year 2023 earnings conference 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. To remove yourself from the queue, you may press star one one again. I would now like to hand the call over to Scott Long, VP of Investor Relations and Corporate Development. Please go ahead. Thank you, Lateef. Good morning, and welcome to the American Airlines Group Fourth Quarter and Full Year 2023 Earnings Conference Call. On the call with prepared remarks, we have our CEO, Robert Isom, and our CFO, Devon May. A number of our other senior executives are also in the room this morning for the Q&A session. Robert will start the call with an overview of our performance, and Devon will follow with details of the fourth quarter and full year, in addition to outlining our operating plans and outlook going forward. After our prepared remarks, we'll 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 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, 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 press release that was issued this morning, as well as our Form 10-Q for the quarter ended September 30th, 2023. 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 are giving you on the call this morning is as of today's date, and we undertake no obligation to update the information subsequently. Thank you for your interest and for joining us this morning. With that, I'll turn the call over to our CEO, Robert Isom. Thanks, Scott, and good morning, everyone. Today, American reported an adjusted pre-tax profit of $257 million for the fourth quarter and approximately $2.5 billion for the full year, driven by the strength of our network, continued demand for our product and fantastic execution by our team. I want to thank the American Airlines team for their incredible work to care for our customers and deliver a 2023 that we're proud of. We're running a historically strong operation, driving incremental revenue through our commercial, commercial initiatives, managing our costs, producing record-free cash flow, and strengthening our balance sheet through debt reduction. This year, we'll continue to prioritize reliability, profitability, and accountability while building an even more efficient and resilient airline. We also remain focused on taking care of our team and continue to make progress on our labor agreements. Our commitment in negotiations has been consistent: reach deals as quickly as possible and ensure our team is paid as well as their industry peers. We finalized a new contract with the APA in the third quarter last year, and a few weeks ago, we did the same for our customer service team, represented by the CWA -IBT, giving team members increased pay and quality-of-life improvements. We continue to negotiate with the APFA with the shared goal of reaching a deal that will pay our flight attendants at the top of the industry. Now, let's talk more about our financial results. We produced record full-year revenues of approximately $53 billion, driven by strong demand for our product and record revenue from our travel rewards program. Demand remains strong, and we have seen robust bookings to start the year as travel trends have begun to normalize across entities. We're also very encouraged by the trends we're seeing in business travel. Domestic revenues from business travel ended the fourth quarter at approximately 90% of 2019 levels. We're excited about the continued rollout of the AAdvantage Business program, and we continue to see strength among small and medium-sized businesses. We see further potential revenue upside as we restore our hubs domestically, enabled in part by the recovery in regional supportability. This year, we expect our system capacity growth to be balanced between domestic and international. More than ever, our revenue growth is fueled by a growing number of AAdvantage customers who acquired our co-brand credit cards in record numbers in 2023. AAdvantage customers represent both our greatest source of value and greatest opportunity going forward. In 2023, two-thirds of our revenue came from AAdvantage customers. These customers also account for 70% of our upsell, loyalty, and partnership revenue. Over the past year, we have made changes to our distribution strategy to give customers direct, improved access to our best products and enable American to provide better customer service to the individual traveler. We're very encouraged by the results. Customers who shop directly with us have a more enjoyable experience and are 11 points more likely to recommend American than those shopping in traditional outlets. They are purchasing more valuable content and doing so at lower expense. In 2023, our revenue was 15% higher than 2019, while our selling expenses were 10% lower. Our fleet, network, and travel rewards program will continue to drive significant value moving forward, and our limited near-term capital requirements will position us to continue to generate free cash flow. Turning now to the operation. The American Airlines team continues to achieve industry-leading operational results. We produced our best ever performance in the fourth quarter and over the full year, including a record on-time departure rate and completion factor during the busy holiday season. American ranked first among the U.S. network carriers in mainline and regional completion factor in 2023, with our lowest number of cancellations for any year since the merger. All of this led to record likelihood to recommend scores in the fourth quarter and full year. No network airline has operated more reliably than American over the past year and a half. We're running the best operation in our history, thanks to a focus on operational excellence and strong collaboration across the entire organization. We'll continue to build on that performance and deliver exceptional service for our customers. Now, I'll turn it over to Devon to share more about our fourth quarter and full year financial results and outlook for the rest of the year. Thank you, Robert, and thank you to the American Airlines team for continuing to produce outstanding results. In the fourth quarter and for the full year, we delivered a fantastic operation for our customers. We took further action to strengthen our balance sheet, and early this year, we finalized a new contract for our customer service team members. In the fourth quarter, excluding net special items, we reported net income of $192 million or adjusted earnings per diluted share of $0.29, an earnings result above our guidance for the quarter, driven by strong operational performance and better ex-fuel unit cost performance. For the full year, we delivered on our stated objectives and produced results in line with the guidance we provided last January, including on capacity production, unit revenue, CASM-ex, and earnings per share. Excluding net special items, we generated full-year net income of $1.9 billion or adjusted earnings per diluted share of $2.65. Importantly, for the full year, we generated free cash flow of $1.8 billion. In 2023, American produced record revenue of approximately $53 billion. We generated an adjusted EBITDAR margin of 14.5% and an adjusted operating margin of 7.6%. In the fourth quarter, revenue was more than $13 billion, our adjusted EBITDAR margin was 12%, and we produced an adjusted operating margin of 5.1%. Our strong operational performance in the fourth quarter resulted in capacity that was 5.8% higher year-over-year, slightly above the midpoint of our guidance range. Unit revenue for the quarter was in line with the midpoint of our previous guidance, down 6.4% year-over-year. Unit cost, excluding net special items and fuel, was up 4.2% year-over-year, nearly a point better than the low end of our prior guidance range. This outcome was driven in part by the strength of our operation, resulting in more capacity, lower overtime and premium pay, and lower interrupted trip expense. Turning now to our fleet. We have modest aircraft CapEx requirements this decade due to the fleet investments we made over the past decade. In 2023, we took delivery of 23 new mainline aircraft. This year, we expect to take delivery of 28 new mainline aircraft, including 27 737 MAX 8, 6 787-9, and 2 A321neo aircraft. Our 2024 aircraft CapEx is expected to be approximately $2.3 billion, and our 2024 non-aircraft CapEx is expected to be approximately $850 million. We continue to have discussions with manufacturers for additional aircraft to deliver later this decade and into the 2030s. Due to the young age of our fleet, we have very modest aircraft replacement needs. As a result, we expect aircraft CapEx to average less than $3.5 billion per year from 2025 through 2030. Our relatively low capital requirements, along with our free cash flow production, has allowed for significant progress in strengthening the balance sheet. We have now reduced total debt by approximately $11.4 billion from peak levels in 2021, and by the end of this year, we expect to have reduced total debt by approximately $13 billion from peak levels in 2021, which is over 85% of the way towards our $15 billion total debt reduction goal. Now, onto the outlook for 2024. Our focus this year will be to continue to deliver industry-leading reliability and to reengineer our business to ensure we run the airline as efficiently as possible while enhancing the customer experience. This year, we'll finally be producing more capacity than we did in 2019. Consistent with our prior expectations, we plan to grow capacity mid-single digits year over year in 2024. This growth will be enabled by improved asset utilization and new aircraft deliveries. Based on current assumptions, we expect full-year TRASM to be flat to down 3% year-over-year. For the full year, we expect CASM-ex to be up approximately 0.5%- 3.5% versus 2023. This unit cost guidance reflects approximately 2.5 points of year-over-year CASM-ex pressure due to collective bargain agreements ratified in 2023 and early 2024, an anticipated agreement with our flight attendants in 2024. Our ability to achieve this full-year unit cost result is due to our focus on operating more efficiently and improving our asset utilization. In 2024, we expect aircraft utilization to be up 2%-4%, and we expect to deliver approximately $400 million in cost savings through the use of digital solutions, reengineering processes, and transforming procurement. We have spent the last 18 months sizing the opportunity and developing plans to reengineer our business to be more productive while improving the customer and team member experience. We are excited about the early results, and we will spend more time discussing these opportunities in greater detail at our upcoming Investor Day. This year, we expect to produce adjusted earnings per diluted share of between $2.25 and $3.25. Using the midpoint of that guidance, we are forecasting free cash flow production of over $2 billion. Looking at the first quarter, we expect travel to be down approximately 3.5%-5.5% on 6.5%-8.5% more capacity year-over-year. We expect first quarter CASM ex to be up approximately 2%-4% year-over-year. Recall that we did not have the cost impact of our new pilot agreement accrued in the first quarter of 2023. Our year-over-year CASM ex performance improves throughout the year as we lap the pilot agreement increases. Our current forecast for the first quarter assumes a fuel price of between $2.65 and $2.85 per gallon. Based on our current demand assumptions and fuel price forecast, we expect to produce an adjusted operating margin of between 0% and 2% in the first quarter and an adjusted loss per share of between $0.15 and $0.35. We are pleased with the progress the American Airlines team has made in 2023, and we remain focused on delivering results to unlock additional value in 2024 and beyond. Now back to Robert for closing remarks. Thanks, Devon. The American Airlines team continues to produce outstanding operational and financial results. When I moved into the CEO role two years ago, we made a commitment to be reliable and profitable, and we have delivered in a big way. We made it clear to all of you what we are gonna do, and our team made it happen. Moving forward, we will continue to execute on our plans and control what we can control. Our team has done tremendous work, but there's much more in front of us as we continue to leverage our fleet and our network and build on our operational momentum. We see significant opportunities to reengineer the business to build a more efficient airline. All of this will enable us to generate sustainable free cash flow. We look forward to sharing much more at our Investor Day on March fourth. Now, operator, please open the line for analyst questions. As a reminder, to ask a question, you will need to press star one one on your telephone. To remove yourself from the question queue, you may press star one one again. To allow everyone the opportunity to ask a question, you will be limited to one question and one follow-up. Please stand by while we compile the Q&A roster. Our first question comes from the line of Michael Linenberg of Deutsche Bank. Oh, hey. Hey, thanks. Good morning, everyone. I guess, sort of a two-part question that involves Latin America, too, I guess, Vasu. December quarter, it did look like that was the geography that underperformed, and I know some have called out that that's going to be a challenging geography in the March quarter as well. Obviously, it's a region that you're very strong in. I believe last quarter, Vasu, you did indicate that you were sort of going to add even more capacity into the region. There were markets that maybe were working there. Can you differentiate between near international beach markets and maybe Latin America long haul? Is there a distinction, one's outperforming the other? Any color on that, and then I have a quick follow-up related to the region as well. Thank you. Absolutely, Mike. No, it's a great question. There's actually two things to clarify. One is the difference between, as we call it, short-haul and long-haul Latin America, and also the difference between year-over-year RASM and actually, marginal profitability. And I'll do the second one first. First, in December, we flew our largest schedule ever in Miami, with so much of it going to Latin America. It also got the most profitable we've seen the Miami hub. We've been able to drive a lot of efficiency over South America. And so while we do see some more challenging near-term revenue trends, the important thing is it's near term, both in short and in long. As we look at Q1, the entirety of our short-haul business, domestic, plus, the short-haul Latin markets together, basically any way where we can fly a narrow body, turns positive by the end of Q1. So we do see the issues as really more near term, and related within the long-haul market too. We see improving trends as we move through the course of the year. Okay, great. Then just my second on Latin America. You know, your partner down in Brazil looks like they may potentially file for bankruptcy. When I think about your CapEx and investments for 2024, are you including in that some potential additional investment in GOL, or is that a TBD, or maybe that's not even on the table? How should we think about that and your relationship there? Hey, hey, Mike, there's probably a lot about this that we're not gonna quite answer yet, but at least let me offer this. First, foremost, and always, our partnership with GOL is a commercial partnership, and we benefit them tremendously through our network, our AAdvantage program, and our customer base. We're a massive source of value for them, and whatever course of action they choose to take, that will hold true. And the last thing I'll say is really for our customers, that no matter what might happen in the region, we see no compromise to our network connectivity, the quality of service, or whatever else might be the case. So we're prepared for all eventualities, but our partnerships are first and foremost commercial partnerships. Thank you. Our next question comes from the line of Scott Group of Wolfe Research. Hey, thanks. Good morning. So overall, we've seen some of the other airlines so far guide to positive RASM this year. How come you guys are so flat to you guys are flat to down on RASM? Any thoughts that explains the difference between what you're guiding to and maybe what some of the others are saying? Thanks, Scott Group. Hey, look, we see, obviously, tremendous demand, but we build our plan based on what, you know, we think is gonna happen. Now, that said, if other carriers are actually seeing, you know, that kind of benefit, it's gonna accrue to American as well. And so I have no doubt that if there are adjustments to our assumptions based on any, you know, reason, whether that be, you know, capacity or, you know, demand, that, look, we're gonna be the beneficiaries, as well as for overall economic performance in the U.S. Yeah, and Scott, I'll only add, our focus in this company is margin performance. And there's so much that can change as you get out into Q3 or Q4. But as we see it right now, as the year has started, we are intaking revenues at the same growth rate that our capacity is coming in. As I mentioned earlier, we will exit Q1 as we anticipate it with positive year-over-year RASM in our domestic and short-haul business. And we expect a lot of the same strength in international RASMs to continue. But first and always, we're margin-focused. So just so I'm understanding, within your RASM guide for Q1, you're expecting domestic RASM to inflect positive by the end of the quarter. Is that right? Correct. Okay. And then just so I hear, just wanna clarify, the full year guide does include expectations for a flight attendant deal? Yes, it does have an assumed flight attendant deal. Okay. All right. Thank you, guys. Appreciate the time. Thank you. Our next question comes from the line of Catherine O'Brien of Goldman Sachs. Your question, please, Catherine. Hey, good morning, team. Maybe one for Devon first. You know, congrats on the progress towards your total debt goal. You know, seems like that's tracking ahead of schedule. You know, what's the right debt reduction target we should be thinking about for 2024, with over $2 billion in free cash flow currently expected? You know, I'm sure we'll hear more in March, but any high-level thoughts on where you want leverage to go in the short term? And what's the appropriate long-term level of net debt or EBITDA or whatever your preferred metric is? Thanks so much. Hey, thanks for the question, Katie. We are pretty focused on the next 24 months right now. So as we mentioned in the prepared remarks, we expect total debt reduction to be down $13 billion by the end of 2024, so about a $1.5 billion improvement from where we were at the end of 2023. We still have a target for $15 billion of total debt reduction by the end of 2025. So we're really proud of the progress we have made over the last couple of years. Also really proud of the progress we've made in smoothing out our debt towers going forward. You know, at the start of 2023, we had over $9 billion of debt due in 2025. Through debt paydown and some refinancings, we have significantly smoothed that tower, and we feel really good about where we're at now. Still feel great about the $15 billion total debt reduction target, and yeah, as we get to the Investor Day in March, we'll talk a lot more about our longer-term goals for the balance sheet. Got it. And then maybe if I could just dig in a little more with you, Vasu, on, on, you know, how you expect the different regions to perform underlying that 1Q unit revenue guide, down 3.5-5.5. You know, understand what you already told us about short-haul and domestic turning positive by the end of the quarter, but would love to just kind of run through transatlantic, LATAM, Asia -Pac, domestic, with whatever details you can provide. Thanks so much. Yeah, sure, happy to. Look, for us, we anticipate that the domestic system will turn positive by the end of the quarter. And maybe I should start by saying this, so much of our capacity is weighted to the short-haul market. In Q1, we will be over 75% of our ASMs in domestic and short-haul Caribbean. So that very much influences things. But we end Q1 with RASM across those regions turning positive. In long haul, we see a lot of effectively flat transatlantic performance year-over-year, transpacific and long-haul Latin flat to slightly down year-over-year. But all of those entities are seeing improving trends, and certainly as we see more capacity changes coming into schedules for March and beyond, those numbers will yet move again. We're probably more encouraged by what we see in short haul than in maybe any other region at this point. Thank you. Our next question comes from the line of Jamie Baker of JP Morgan Securities. Please go ahead, Jamie. Oh, hey, good morning, everybody. A couple for, for Vasu. First, the dead horse question. I know you're not gonna give specific guides on geographic profitability, but as we think about the Northeast Alliance unwind and, you know, considering demand seasonality, what quarter do you anticipate the maximum pain from the unwind being experienced, and perhaps that's behind us in your models? Just, you know, at what point are New York and Boston the largest drag or the least contributing? However you wanna think about it. Well, Jamie, the worst is behind us. Okay. That happened in Q3. In fact, New York, and I'd refer you and others to prior commentary that I've made on this, either in press or on these calls. The New York marketplace, the New York customer base has changed in the post-pandemic world. It now is a thing which our slot portfolio serves a whole lot better. Our New York performance is doing better. And unlike what led to the partnerships we've had there, we see continued growth in origination share. New York is our largest market for enrolling new customers, both in Advantage and in the credit card, and it had never been that prior to the NEA. So we're certainly open to any partnership that is better for our customers, period, full stop. But for where we are right now, the worst is certainly behind us. Perfect. And then on corporate recovery, you know, in the past, you and I, I mean, we've all spoken about blended travel and, you know, the network and pricing changes that you've made to take advantage of that phenomenon. When we think about what you are seeing today in terms of corporate recovery, though, is it robust enough that you need to make further adjustments, or is it simply incremental yield without any cost or effort? Hey, Jamie, it's a great question, and maybe one that speaks at large to our distribution strategy, so let me speak at large to that first, and I'll hit that. First, all of our changes, whether it's Vasu's with corporate travel management or travel agencies or what have you, are this simple: We sell our product through the internet. That's what our customers demand. That's how we can give them the best content at the lowest expenses to them, and the best servicing. And we see that. We see that we're producing revenue more efficiently, more strategically, more to the liking of our customers. I'll echo what Robert said. We're up 15% in revenue. We're down 8%-9% in selling expenses. Our likelihood to recommend scores are higher. But as we look at it, what has really been a change is 65% of our revenue comes from Advantage customers, but we can do that more. About 45% of our revenue is coming from Advantage customers who are buying premium content, a better seat, more refundability, more flexibility for miles, and that's up 3.0 year-over-year. So, that's all to say that. And any which way we double-click on that, it's meaningful, right? We too exit Q4 with a 90% business recovery. Within that, unmanaged business versus managed business is almost a 3-to-1 ratio, with unmanaged business 100%+ recovered, managed business down further. The impact on managed business is really flat, traffic on higher yields. So as we go forward, actually, we're gonna lean further into this. What we have realized through this is, first and foremost, we need to make it easy for our customers to consume our content through the internet. So we're gonna offer more mileage for customers who shop through the internet. We're gonna roll out better servicing capabilities for internet distribution, and we are going to start restricting the amount of selling and servicing that we do through non-internet-based channels. And we invite all the travel managers and all the travel agencies of the world to join us in this, because this is great for customers, and it should be great for them, too. All of our financial incentives targeted to that audience are really around helping them shift. So we've actually been very encouraged by what we've seen. I mean, clearly, our relative revenue performance is similar to what it was in the exit pandemic period, and now in the year ahead, we have the opportunity to optimize. Thank you. Our next question comes from the line of David Vernon of Bernstein. Hey, good morning, guys. So on the topic of sort of premium and how the you know, buy-ups are affecting the business right now, can you give us some sort of color around how you know, the premium product sales or movements up and down the fare ladder are happening, growth in basic, growth in premium? Just give us some sense of kind of where you are in that process of tapping into what is a more lucrative segment of revenue. Hey, thanks, David. This is Vasu, and I'll pick it up right where I left it off. I think I can probably give you a fact point that makes it easier to understand just why we are so focused around selling, creating more content for Advantage customers. So if you look at our system right now, about 7% of what we sell is basic economy, and indeed, that is up 20% year-over-year. But that's up 20% year-over-year because we changed its product. Last year, we included it in commission dealings and corporate travel management programs. We just took it out last year. We reintroduced it this year, and that's actually not the critical thing. What's been more interesting to us is 10% of our revenue is coming from customers who actually shop basic, but then buy something higher. And within that, that number is up 25% year-over-year, and almost all of its growth is coming through dot com and app. And we see more and more ways where customers actually, who are coming for a basic product, want more than that, and we can go and deliver that to them, which is why so many of our distribution strategies, far from, being risky, we see as a great opportunity. Okay. And then maybe just as a quick follow-up, as you think about some of the rationalization of the negative margin or lower margin capacity that's being contemplated out in the industry, you know, how do we how should we be thinking about the impact of, let's say, an unbundled operator pulling in capacity on your fare ladder? Does that is that sort of uniform impact up and down the different fare classes, or is it more concentrated in something like a basic product? Anything you can tell us to help us understand how some of the capacity changes in the market might impact American would be really helpful. Well, look at large, and I think Robert mentioned it earlier. I mean, it is, like all businesses, supply-demand driven businesses, and if there's less supply, that's gonna have a clear impact on demand. But for us, with things like basic, in fact, for all of our fare products, we do not make products that are so odious, no one will buy it. The whole point of them is to actually have customers experience travel and join Advantage. And for us, Basic Economy is not about a competitive product. It's our entry-level product that gets customers in the door and signed up for Advantage. Hey, David, I just want to add one other thing here, which is this, is that, you know, we've built technology to enable us to react to whatever may come our way. So, you know, as Vasu has said, that, you know, look, you know, our goal is to make sure that we can deliver a product to the customers the way they want to receive it. It also has to be done in a way that is incredibly, you know, nimble and can be changed. And in the past, you may have seen, you know, carriers, you know, even American, you know, unable to react very quickly. That's not the case right now. So whatever happens in the marketplace, we've got the technology, we've got the product to be super competitive, and whether it's us developing it on our own or having to compete, we'll be ready. Thank you. Our next question comes from the line of Connor Cunningham of Melius Research. Please go ahead, Connor. Again, Connor, please make sure your line isn't muted, if you're on a speakerphone, lift your handset. Or go to our next question. Our next question comes from the line of Ravi Shanker of Morgan Stanley. Your question, please, Ravi. Good morning, everyone. This is Catherine on for Ravi, so thank you for taking my question. My question is really around the Investor Day in a few weeks, which I know is probably the first one you guys have posted in about seven years. And I was just curious what investors can expect to hear during the event, whether it's, you know, new financial long-term targets, revenue initiatives, just any color around the event would be great. Hey, Catherine, thanks. No, we're excited about the Investor Day. And look, we've worked really hard to put, you know, the focus of the company on doing the fundamentals really well. You know that we've talked about returning the company to reliability, profitability, strengthening our balance sheet by paying down debt. We're in a really great spot now to talk about what's next. And on that horizon, we're gonna be talking about, you know, the benefits of all the work that we've done on our fleet. Everything we've done with our network and partnerships. Vasu's mentioned, you know, a number of times, even today, the potential within our loyalty program. We're gonna talk about even doing better in terms of what we deliver to our customers. And ultimately, we want to talk a lot about how we can do that all, a lot more efficiently. One of the things you'll see is that American's a Look, it's a, it's a changed airline. We have a focus on producing free cash flow and ultimately, rewarding our shareholders. So can't wait to tell you more, about all of that. Just as a quick follow-up, I know it's probably too early, but I was curious if you had seen any share shift in January, just due to the issue with the MAX grounding with other carriers. I wasn't sure if you had seen anything in the data. No, Vasu can add some color to that. Look, January isn't it; it's been a strong month for us, but it's never the busiest month of the year. And so we'll fly load factors in the, you know, the 70s. It's probably similar for the rest of the industry, and while I'm sure that there's benefit, I know that there is, it's not material when you think about the number of seats that are open for all carriers and the overall size of the American Airlines business. Thank you. Our next question comes from the line of Duane Pfennigwerth of Evercore ISI. Your question, please, Duane. Hey, good morning. Thank you. Maybe start with Vasu. Can you speak to advanced bookings beyond 1 Q here? Just curious, when we had this real, real surge this time last year, maybe you could just comment on, you know, what the booking curve looks like, if it's shorter, if it, if it's lengthening. And if you have any commentary on, you know, domestic versus international book yields as you, as you look a little further out into peak periods. Yeah. Hey, thanks for the question. Look, the booking curve is largely flat to last year. There is a moderate shift, let's call it two points from outside of the inside 30-day range to the outside 30-day range. What I would say is right now we're intaking revenues in line with capacity, and entity by entity, market by market, sometimes it's yield, sometimes it's traffic. But as long as that's continuing, we're encouraged. Right now in the summer, really the most impactful thing that we see is long-haul, and we're seeing long-haul book up on a revenue basis at the same rates as we saw last year, which is a particularly strong year, and we're just too early in the domestic and short-haul curve to really see that yet. But we're encouraged by what we see, even as we start selling more of March and the post-Easter period too. Thanks. You actually said more than I thought you would. Just to follow up there, on the long haul, any commentary on booked yields? Are we holding serve, or, you know, are we going backwards a bit? Yeah, so far we're holding serve, and it's still a long way to go, though. Thank you. Our next question comes from the line of Andrew Didora of Bank of America. Please go ahead, Andrew. Hey, good morning, everyone. So Robert, just on the, the operations, you've obviously made some great strides here post-pandemic. Certainly seems to really be helping your CASM. Don't want to steal any thunder from Investor Day, but just kind of want to get your bigger picture thoughts on, like, what is next operationally at American into 2024 and 2025? What's the plan? Or are you at a point now where it's sort of maintaining what you have built so far? Hey, Andrew. Oh, thanks. Well, well, look, we're really proud of the team and what they've accomplished. You know, you think about American Airlines being the most reliable carrier in the country, you know, over the last 18 months, over the last year. So nobody can claim that they, you know, flew a more reliable schedule, or canceled fewer flights, and, we're really proud of that. But I'll tell you, that's a baseline now, that we can take, going forward. And you're right about, you know, the best way to run an airline is the most reliable. All the rework costs are taken out of it. But we're not gonna stop there. We can do what we did, and we can do it more efficiently. I wanna just hand the mic over to David Seymour to talk a little bit more about how he thinks we can bring things like technology to bear. David? Yeah. No, Robert, thank you. And again, super proud of what the team has done in 2023. It was a great year, but it really, as Robert said, it is the foundation of where we're headed into 2024 and beyond. What I'd tell you is we have a much better understanding of the complexities of our operation, and we're investing in technology to solve quickly and more efficiently and more optimally than we ever have before. So, our relationship and our partnering with our IT team is just starting and we see a lot of opportunity in the future to do what we do better, more efficiently than we ever have before. Got it. And then my follow-up question, you know, Vasu, you know, a lot of discussion on the call just with, with regards to your distribution strategy. You know, I thought the, the 80%, you know, of, of bookings coming through these new channels was, was interesting. Now, where do you think this can go? I mean, 80% already seems pretty high. And what, what have been the growing pains thus far, with the NDC rollout? Thank you. Yeah. Hey, thanks for the question. Look, I'll answer it in this way. We have been similarly enthusiastic and even a little surprised at how quickly the transition has happened. It's not just that we're 80% coming through internet-based technology. Within that, 65%+ is coming just strictly through our own channels, which is our greatest rate of growth. So first, I will say, our strategically, we're gonna distribute through the internet. It's what our customers demand. That's how we give them the best fares and the lowest expenses and the best servicing. So at some point, the number becomes 100. And the real issue in 2024 is we want to just continue to transition as many of our retailing partners to use the internet with us. So ultimately, it becomes 100. We're really encouraged by what we've seen there. Thank you. Our next question comes from the line of Savi Syth of Raymond James. Your question please, Savi. Hey, good morning. I just to follow up on the commentary about balanced growth between domestic and international, I was curious if you can talk a little bit about, like, on the international side, if there's kind of a difference in growth trends between Atlantic and Latam and Asia. And then on the domestic side, just, you know, if the regional mix you you know, what kind of a improvement in mix you're expecting this year? Sure. Just so that I understand, you're talking about the American Airlines capacity mix, correct? Exactly. Not like the industry capacity mix or something? That's right. Correct. Okay. Well, look, at large, consistent with pretty much all that we've talked about, we will, through the course of the year, be a roughly 75-25 short-haul, long-haul carrier. Increasingly, about 50, our growth will be split about 50/50 between short haul and long haul. Certainly the thing that we are maybe most enthusiastic about is the continued improved utilization of our wholly owned regional jets. In fact, so much of how domestic turns to positive RASM is directly correlated to us bringing regional jets back. And, as good as that's starting to look in the weeks and months ahead, we know we still have 10% more utilization to do there. So, that's really where our opportunity is. In long haul, I mean, you can kind of see the schedule that's out there right now. There's probably not a lot of difference when it actually goes to fly. But a big chunk of our footprint will be in transatlantic in the summer, which tends to be the highest demand thing, followed by Latin America and last of all, Pacific. That's helpful. Vasu, if I might, just kind of the converse of the basic economy discussion on the premium revenue side, just wondering if you can talk about what you're seeing there, and, you know, if you're seeing any, you know, what you're seeing on the kind of the booked first class load factor, those kind of trends. Yeah, look, 60% of our revenue comes from customers buying premium content, of which 45 points of that are Advantage customers and 15 points are non-Advantage customers. So I'd say at large, our real commercial opportunity is to make those people who are help those people who are 15% buying premium content join our program, and give continuity of great content to the people who do. And we see continued improvements in premium load factors, pretty much every way there is. Premium revenues across our system are up 15%. Premium book load factors are at their highest levels, you know, approaching close to 80 in some periods that are there. And really a lot of what we're endeavoring to do is reserve so much of our premium capacity for Advantage customers. Thank you. Our next question comes from the line of Connor Cunningham of Melius Research. Please go ahead, Connor. Hi, everyone. Can you hear me? We've got you, Connor. Go ahead. Thanks. Sorry about that. Just in terms of, of, headcount for 2024, we haven't heard a lot about that from you guys. You know, from the industry standpoint, it's obviously slowing, but what do you need to add this year to kinda hit your 2024 trajectory in terms of capacity and maybe beyond that? Thank you. Yeah, for this year, it certainly is a lot less higher than what we've done in the past. We are gonna be bringing on about 1% more headcount, so we'll call it somewhere around 1,000 or 2,000 more heads this year, but a big reduction from where we were last year. And it's just a sign of where we're at with efficiencies as well. We probably hired ahead a little bit in 2023, but, you know, this year we're looking to grow the airline mid-single digits, and headcount's gonna grow by about 1%. Okay, perfect. We haven't actually heard a lot about maintenance headwinds from you guys, and that's been, like, a major theme from a lot of the other carriers. Are you seeing any meaningful call-out into 2024? And then what are you guys doing specifically to mitigate a lot of those headwinds? I realize that it grew a lot last year, but is that kind of normalized going forward? Thank you. Yeah, I'll start and just maybe talk about where the P&L has been, and then turn it over to Robert and David. But we did have some headwinds in 2023. I want to say our maintenance expense in 2023 versus 2022 was up something close to $500 million. This year, it flattens out a bit. We do expect it to be up, and it's one of the areas of the P&L where we'll have a little bit of variability, just depending on how many in-house engine overhauls that we end up doing this year. But 2023 was a big step up. 2024 is less so, and there is a lot of great work being done on David's team to address it, so I'll hand it over to them. Yeah, so I'll just start, Connor. I think one of the things that I look at is that, you know, maintenance needs for the industry as a whole are gonna increase greatly. American's really well-positioned, not only because of what we've done over the past decade by bringing in, you know, more new aircraft than anyone, but as well, remember that we have maintenance capabilities where we're not fully solely dependent on outside resources that are gonna be incredibly constrained. So one of the things that I know David can talk to us about is that, you know, we're going to make sure that we have even more capacity to do engine overhauls. We already have 12,000 mechanics, more than anybody else in commercial aviation, and we're gonna put them to good use, and I think that that's going to be, you know, even more of a strategic advantage for American as we take a look at a really constrained resource. David? Yeah, Robert. Yeah, there's a lot of effort, but both what Robert and Devon talked about is that a lot of focus here, and we have these normal waves that we run into with maintenance cycles that we have on heavy checks and engine checks that we gotta do. But a lot of emphasis this past year and going into 2024 of getting a lot more efficient in how we manage that maintenance. As Robert talked about, we have really good control with longer-term resources to get that work done. So we're very confident that we're gonna be able to get the efficiencies and reduce some of that cost here in the near future. Thank you. Our next question comes from the line of Daniel McKenzie of Seaport Global. Your question, please, Daniel. Oh, hey, thanks. Good morning, guys. My two questions are on technology as well here. So 65% of the bookings going to 100% on aa.com, what percent or portion of the revenue does this represent today? And, you know, what percent of the revenue was up 15% exactly? What I would say is, let me first clarify. So 65% of our bookings are going through our digital channels. On a revenue basis, it's actually a little bit north of that. It's probably a little closer to 70%, as we're intake, and those are our revenue intakes that are coming in. Separately from that, when we go look back at 2023, 60% of our revenue came from customers buying premium content, which is a premium seat or greater flexibility around a premium seat. Of those, 15% of our total customer base is non-AAdvantage, about 45% is AAdvantage. Yeah. Oh, thanks, Vasu, that's helpful. And then the second question is really a bigger, longer-term question on potential cost savings, and it relates to the transition to the cloud. I'm wondering, you know, where American is at with respect to that transition and what kind of cost savings that could ultimately represent on an annual run rate? So is it $10s of millions, $100s of millions, or, you know, maybe somewhere in between? Hey, Dan, let me start on this one. As need be, Devon or others can pick up. But, this is actually a great one, which we look forward to talking about more in our Investor Day. We are operating the entirety of the company with a tech-first mindset. This is one of many initiatives, but by no means the biggest, as promising as it is, as you've laid out. So more to come soon. Yeah, and Vasu, I'll just add that, look, you know, all that kind of work will be a facilitator to delivering product, you know, faster, more efficiently, and so that's the kind of mindset. So, we're not. I'd rather not talk about it just as a discrete item. We'll bring it all together, as we get to March fourth. Mm-hmm. Okay, thanks, guys. Great job. Thank you. At this time, we ask all media, if you have a question, to please press star one one on your telephone. Again, that's star one one on your telephone to ask a question. To remove yourself from the question queue, you may press star one one again. To allow everyone the opportunity to ask a question, you will be limited to one question and one follow-up. Again, at this time, we ask media to press star one one. Our first question comes from the line of Alison Sider of Wall Street Journal. Please go ahead, Alison. Hi, thanks so much. I was wondering, you know, what is your level of confidence in Boeing's current leadership? Hey, Ally, look, a couple of quick things. You know, first off, some of Boeing's current issues are all around the MAX 9 and the 737-900s. American Airlines does not fly those aircraft. We're a huge Boeing customer, though, and you know, we're dependent on them for just producing. We're gonna hold them accountable. Boeing needs to get their act together. The issues that they've been dealing with over the recent period of time, but also going back a number of years now, is unacceptable. And no matter who it is, all of Boeing needs to come together and to get back on the right track. The production limits that the FAA announced last night for the MAX, like, do you expect that to have any impact on deliveries for American? I mean, do you think that that makes sense for Boeing? So, look, we will encourage Boeing to do everything that they can to get back on track and produce a quality product, you know, plain and simple. You know, for us, we have a fleet right now of over 1,500 aircraft, so we have 20 MAX 8s that are on the horizon for this next year. These aircraft are, you know, likely already in production, and I don't anticipate to run into any issues. But I'll say this as well, though, nobody has taken on more new aircraft than American Airlines in recent history, and, you know, we take that acceptance process, you know, very, very seriously, and we've done that for years. We have the teams of people in place to make sure that what comes on to American's property is ready to go, ready to fly. As I said before, we encourage Boeing to get their act together, get back on the right track. Thank you. Our next question comes from the line of Mary Schlangenstein of Bloomberg News. Please go ahead, Mary. Good morning. Just to follow up on that, as you continue to talk to OEMs about a potential narrow body order this year, are the things that are occurring at Boeing right now having any impact at all as you think about placing that order? And then also wondering if you think that federal officials are taking the right steps in looking at Boeing. They've said, you know, they may expand to other production lines in the MAX. Do you see them taking the right steps, or would you like to see them doing something different, maybe going even stronger on new requirements from Boeing? So Mary, thanks for the questions. Let me just start with this first. Administrator Whitaker, we have incredible confidence in. He's the right person for the job right now, and I'm very confident that he will hold all of us, but especially Boeing, accountable for what they do. And to that end, I think that's the right approach. Look, aviation in the United States, aviation throughout the world, it's the safest form of transportation. We have a commitment to keep it that way, and Boeing has to be part of that equation. Now, as we take a look at future needs for aircraft, again, American Airlines is, you know, we have 1,500 aircraft, and a lot of the growth that we've been talking about is getting planes back up in the air that, you know, we could get more utilization out of. So we're fortunate from that perspective. We're also fortunate to be the operator of the world's largest fleet of Airbus aircraft. So look, we need Boeing to be successful over the long run. They've got to get their act together. We need all OEMs to do their job. It's hard enough running an airline. We need quality product, and that's what we demand. Can you comment on whether what's going on at Boeing will reflect your ultimate decision on a narrow-body order? Well, we'll take. Look, we take the acquisition of new aircraft, of bringing new aircraft down to American fleet very seriously, and we're gonna make sure that whatever is purchased, whether it be from Airbus, Boeing, Embraer, you name it, that's something we take very seriously, and we're gonna make sure that that product is incredibly reliable, safe, right from the get-go, right off the factory floor. Thank you. Thank you. Please stand by for our next question. Our next question comes from the line of Leslie Josephs of CNBC. Your question please, Leslie. Hi, thank you. Are you increasing your oversight personally at Boeing, and do you see that as a permanent change, just given that it's kind of been one issue after another? And then, just another question, is Boeing providing any compensation, whether cash or in the form of, you know, discounts or anything else because of the issue and the FAA blocking any further production that could impact deliveries? Thanks. Hey, Leslie. Look, as I've said before, American Airlines has taken more new aircraft than anyone in really the history of commercial aviation over the last 10 years. And, you know, on that front, we've had to deal with quality issues that we've had to make sure that we were protected against. And so from that perspective, we have a very robust aircraft acceptance process with people that are dedicated to that, and we're gonna make sure that whatever we take from any manufacturer, and especially Boeing, that we have the right resources to ensure that they meet our specifications and are ready to go when they come in, into our fleet. And I'll leave it at that. Thank you. That does conclude the Q&A portion of our call. I would now like to turn the conference back to Robert Isom for closing remarks. Sir? Thanks, Lateef. Look, 2023 was an exceptional year for us. It was another year of building back from the pandemic, and I'm really proud of what the team has done. They've established us as the industry leader in reliability. We've restored the airline to profitability. We produced record free cash flow last year. We've got another year of really making sure that we continue the progress. It's a year that we're still recovering from the pandemic, and we're gonna have to see how demand and capacity all shakes out. But as I've said, you know, or even earlier today, we expect the demand to be very strong. The spring and summer, I think, are gonna be exceptional times for us in terms of demand for product. And as we look forward, you know, I'm very interested in sitting down with folks and talking on March fourth at our Investor Day and talking about the future of American. Building on that platform, showing how we have changed and that we have a mindset of producing for our customers, taking care of our team, and also making sure that we reward shareholders. More on that in the next month, and everybody take care, and we'll talk soon. This concludes today's conference call. Thank you for participating. You may now disconnect.