Thank you for standing by. At this time, I would like to welcome everyone to today's Allegiant Travel Company's Second Quarter 2025 Earnings Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during that time, simply press star followed by the number one on your telephone keypad. Once again, star one. If you'd like to withdraw your question, simply press star one again. Thank you. I would now like to turn the call over to Sherry Wilson, Managing Director of Investor Relations. Sherry. Thank you, Greg. Welcome to the Allegiant Travel Company Second Quarter 2025 Earnings Call. We will begin today's call with Greg Anderson, President and CEO, providing a high-level overview of our results along with an update on our business. Drew Wells, Chief Commercial Officer, will walk through our capacity plans and revenue performance, and finally Robert Neal, Chief Financial Officer, will speak to our financial results and outlook. Following commentary, we will open it up to questions. We ask that you please limit yourself to one question and one follow-up. The company's comments today will contain forward-looking statements concerning our future performance and strategic plan. Various risk factors could cause the underlying assumptions of these statements and our actual results to differ materially from those expressed or implied by our forward-looking statements. These risk factors and others are more fully disclosed in our filings with the SEC. Any forward-looking statements are based on information available to us today. We undertake no obligation to update publicly any forward-looking statements, whether as a result of future events, new information, or otherwise. The company cautions investors not to place undue reliance on forward-looking statements, which may be based on assumptions and events that do not materialize. To view this earnings release as well as the rebroadcast of the call, feel free to visit the company's investor relations site at ir.allegiantair.com. With that, I'll turn it over to Greg. Thanks Sherry and thank you all for joining us today. I'm proud of our second quarter results where once again we delivered an excellent operating performance with a 99.9% controllable completion. We flew more than 5 million passengers, a record for the second quarter, and approximately 70% of those are repeat customers, a sign of our strong net promoter scores and reflects our position as the leading airline in most of the communities we serve, offering reliable nonstop travel at unbeatable value. I'm also happy to report that we achieved an airline operating margin of 8.6%, exceeding our initial guidance. Combined with our first quarter performance, our first half operating margin was close to 9%, an improvement compared to the first half of 2024. Team Allegiant has done a good job of controlling what we can control. Aircraft utilization is back to our historic productivity levels, increasing by 17% in the first half versus a year ago, while total aircraft and personnel have remained flat. Furthermore, we are continually enhancing our commercial offerings and we are keeping a tight lid on costs. What we can't control is the demand environment. As many airlines have already commented, domestic leisure demand was noticeably softer during the first half of this year than initially anticipated. Despite this weaker domestic demand backdrop, we achieved solid profitability. Because we are one of the lowest cost providers in the industry and have a relentless focus on offering our customers attractive prices and a safe, reliable on time product, we are making headway with our Allegiant-centric initiatives. With Navitaire's initial revenue headwinds behind us, we are better positioned to accelerate our progress as we further enhance its capabilities. Along with pursuing additional commercial initiatives, our new Boeing 737 MAX aircraft are boosting our performance as expected, leading our fleet in reliability and contributing a significant margin advantage when compared to our older A320 aircraft. The MAX fleet accounted for roughly 10% of our ASMs in the second quarter and we expect that amount to exceed 15% by year end. Our premium Allegiant Extra offering is in high demand by our customers. We are benefiting from a significant price bump for this product which is both additive to margin and TRASM. Drew will speak in more detail, but I wanted to provide some insight to our overall TRASM trends. There are several factors that impact TRASM including the mix of peak versus off-peak flying, existing markets versus new markets, and of course, capacity growth. When you look deeper into the numbers, peak TRASM is performing relatively well, reflecting strong customer demand during high travel periods. It is the shoulder and off-peak periods where demand softness coupled with capacity growth has driven outside headwinds to reported TRASM. There are two things that are important here. The first is that we continue to manage our network to maximize profitability, and the shoulder and off-peak flying we've added this year have been margin accretive. Second, adjusting for the mix of flying, we believe our TRASM decline compares favorably to domestic leisure trends of our peers, highlighting our strong competitive offering and positioning with our customers. We announced last month we are exiting Sunseeker, allowing us to further simplify the business and solely focus on our core airline. With that, let me shift to our initial views for the second half of the year. Although signs from the performance of the U.S. economy appear to be mixed, we are cautiously optimistic in our recent bookings that suggest a modest strengthening of leisure demand. Keep in mind that our third quarter is typically our seasonally weakest period for leisure demand due to the higher proportion of shoulder and off-peak compared to other quarters, with the second half of August and most of September representing the lowest period for leisure travel during the year. A key attribute of Allegiant is our flexible scheduling as we live to piece to piece and apply off-peak when it makes sense economically. Appropriately, we pulled back on our capacity growth expectations for the full year due to increased macro and geopolitical uncertainty. We have made further adjustments with September ASMs now expected to be roughly flat year over year. BJ will provide more details shortly, but we expect to incur an operating loss in the third quarter. Importantly, we continue to expect to report a healthy operating profit for the full year, with our fourth quarter historically more in line with the first two quarters and a much stronger quarter than the third as leisure travel typically picks up seasonally. I also want to reiterate that we remain steadfast on our core principle that we need to earn the right to grow. While 2025 has been a year with meaningful growth and as mentioned that growth was accomplished without adding to our fleet count or to our personnel, it represents a one-time catch-up year after MAX delivery delay that sharply curtailed our capacity growth in previous years. Encouragingly, when we compare our first half 2025 year-over-year changes between TRASM and CASM- X, we believe it to be among the industry's best. As we look to 2026, we currently expect capacity to be relatively flat as we further harvest our current infrastructure. Those plans should help us improve our yields for several reasons. First, we expect to drive incremental revenue through enhanced Navitaire capabilities and new commercial initiatives. Second, we should benefit from routes maturing and with peak flying representing a greater proportion of ASMs at 2026 and 2025. Also, we expect a tailwind from a more fully ramped Allegiant Extra, which will start the year being deployed on 70% of our fleet, up from 50% at the beginning of 2025. Third, we anticipate our Allegiant credit card remuneration will continue to grow from the $140 million expected this year. It is a great source of steady incremental cash flows. Drew will provide more details, but suffice it to say those offerings as well as other revenue-generating initiatives give us confidence today that the unit revenues should improve in 2026, all else being equal on the demand backdrop. On the cost side, we are continuing to increase the usage of the MAX aircraft, which are expected to be more than 20% of our ASM for 2026, up sharply from 2025. We are planning to divest some of the Airbus fleet over the course of the coming year with any proceeds used to further strengthen our balance sheet. We are keeping a tight control over costs. Our cost structure is a key competitive advantage. When you put it all together, we are taking important steps to simplify our business and further strengthening our core airline competencies. The airline is operating extremely well and we continue to position ourselves to deliver strong incremental margins. I am excited about what's in store for us over the coming year and beyond, and let me close by highlighting how proud I am that our team's performance resulted in Allegiant being named Skytrax Best Low Cost Carrier in North America for the second year in a row. Our greatest driver of success is Team Allegiant, our dedicated team members who deliver a great service for our customers every day of the year. Their dedication sets us apart and I'm honored to work with such a talented team. With that, I'll turn it over to Drew. Thank you, Greg, and thanks to everyone for joining us this afternoon. We finished the second quarter with $669 million in airline revenue, approximately 3% above the prior year, producing a 2Q TRASM of 11.57. This was down 11.2% year over year, in line with our internal expectations from the prior call. Allegiant grew total ASMs 16% with overall utilization up 17%. Despite the increase in utilization reducing available plane space for our fixed fee slide, our fixed fee revenue was down just 4% on a year over year basis and ahead of our internal estimates for the quarter. While BJ will hit on the unit cost benefits of our growth profile, the expectedly net impact on our unit credits focusing a bit on the core of Allegiant's strengths in deploying predominantly peak day capacity, unit revenues in our markets operating the same capacity in both the current year and prior year, mainly comprised of markets flying 2 to 3 times per week, are off roughly 6% year over year, seemingly in line with commentary from others throughout the cycle. While perhaps oversimplified slightly, the growth profile contributed roughly 5 incremental points of headwinds and fell generally in line with our typical expectation of the relationship between growth and unit revenue change. We certainly saw more resilience on peak days where even in the aforementioned same capacity scenario, peak days held up about four and a half points better year- over- year than off peak days. New peak weekends even came to light. The emergence of Juneteenth as a strong traveling holiday was a welcome addition and was in fact the strongest traveling week of the summer. While a traditional peak week around the 4th of July was top in total run, our approach to capacity in the second half of the year aims to align capacity with demand in our typical fashion. Our 3Q growth rate is down more than 10 points from our estimates at the start of the year. As mentioned on the last call, those cuts are heavily focused on the off- peaks, both day of week and season. August, for example, saw an 18 point change in expected capacity and September will only be approximately 48% of July f lying. A fter the cuts, we still expect third quarter scheduled service ASMs to grow approximately 10% with the fourth quarter slightly higher than that given 2024 hurricane- related camp [audio distortion]. We've certainly seen demand pick up in July earlier than last year, and while those same capacity market did improve slightly in July relative to June, the uptake missed a good portion of the July booking window. Additionally, due to the overweight portion of third quarter ASMs falling in July, the third quarter will see a lower overall benefit than other carriers, most likely. Broadly, we do believe the back half of the year is setting up better than most of the last six months. Consumer confidence ticked higher in July and the industry setup is improving through the post summer trough. That said, the November- December industry growth profile remains elevated and in particular capacities of leisure oriented destinations have an even larger spread versus last year. Our revenue forecast for the back half of the year contemplate this year's various factors largely washing out and producing a generally similar trajectory relative to 2024, sufficient to forecast sequentially improving year over year traffic trends in each of the third and fourth quarters. Significant tailwind beyond that would represent upside more likely in the fourth quarter than the third, s imply given amount of time left to book. W e feel bullish enough about Florida demand to introduce a small handful of new markets into the network. These include service to a new airport in our network, Southwest Florida International RSW in Fort Myers, Florida, which we believe is complementary to our incredible service in Punta Gorda about 40 minutes away, as well as a ninth route into Gulf Shores, Alabama, an airport we began serving in only May of this year. All seven of our new routes launched just before Thanksgiving, focusing on peak demand times over the holidays and some next year's spring break period. A part of the improving trend is due to the continued traction of our initiatives. Allegiant Extra will grow to 2/3rd of departures in the third quarter while showing extreme resilience with the increased profile. As indicated on the last call, we recaptured $2 per passenger of lost revenue from the initial Navitaire implementation and now believe we gained the first incremental dollar of benefit from the system. Some of the early wins we're discovering aren't necessarily solely ancillary revenue per passenger lift or rather conversion and in turn load factor benefits that we expect to see manifest more fully in the coming months. In fact, July load factor should be the best month year to date, both in terms of the actual metric and the year over year performance. Finally, while we're thrilled with the trajectory and results of our award winning Allegiant Allways co-branded credit card and loyalty programs to date, we have kicked off an in depth review of the programs to ensure we are continuing to offer a value proposition that resonates with our customers after nine years and much industry change. A s we dig in on the evolution of these programs to best support our customers' need, w e'll come back with more details in the coming quarters. Now I'd like to hand it over to Robert Neal. Thank you, Drew. Good afternoon everyone. I'll walk through our results and share our outlook today, all on an adjusted basis unless otherwise noted. This afternoon we reported second quarter consolidated net income of $22.7 million and consolidated earnings per share of $1.23. The airline segment produced net income of $34.3 million and airline only earnings of $1.86 per share, exceeding our initial expectations of approximately $1. This outperformance was attributable to solid cost execution throughout the quarter on a share count of just under 18 million and drove operating margin to 8.6%, ahead of our guided range. Our second quarter consolidated results do include special charges of $103 million related to the pending sale of Sunseeker Resort announced in early July. We remain on track to close on the sale in early September. Airline EBITDA was $122.5 million, yielding an EBITDA margin of 18.3%. Fuel averaged $2.42 per gallon during the quarter, in line with our initial forecast. Our focus on growing into our labor force and leveraging existing infrastructure kept momentum during the second quarter with total airline operating expenses of $611 million, up just 4.9% year- over- year on capacity growth of 15.7%. I'm very pleased with the team's cost execution. Excluding fuel, unit costs were down 6.7% despite removal of nearly 7 points of planned capacity growth in the quarter. Our CASM-X result included a one point headwind for an expected transitory cost in the aircraft rent line as we prepare to return 11 aircraft off operating leases which originated during the pandemic. Department leaders across the organization have been focused on cost performance, especially in light of capacity reductions and the softer demand environment experienced during the first half. We will continue to set capacity for optimized margins, and we are not solely focused on unit cost results. That said, we pulled 4.5 points of capacity growth from our 2025 plan and still expect full year non-fuel unit costs to be down mid-single digits thanks to numerous budget initiatives across the organization. Turning to the balance sheet, we ended the period with robust total liquidity of $1.1 billion, which includes $853 million in cash and investments and $275 million in undrawn revolving credit facilities. In addition, we have $335 million in available undrawn loan commitments. At the end of the quarter, cash and investments were approximately 34% of trailing twelve-month revenue a t quarter end. W e made continued progress on debt reduction, repaying $152 million including $113.5 million in non-recurring repayments and $38.5 million in scheduled principal payments, ending the quarter just below $2 billion in total debt. Net leverage remained flat sequentially at 2.6 x, down from 3.8x at the end of the second quarter last year. Capital expenditures for the quarter totaled $137.7 million, comprised of $108.3 million in aircraft-related spend and $29.4 million in other airline CapEx. Deferred heavy maintenance accounted for an additional $10 million during the period. Now moving to fleet, we retired two A320 series aircraft and took delivery of five new 737 MAX aircraft, of which one was placed into service at quarter end. We are pleased to say that Boeing has exceeded our expectations on aircraft deliveries throughout this year, and we expect our remaining three aircraft for 2025 to be delivered in the third quarter as we ramp up operation of our MAX fleet in the fourth quarter. Predictable and reliable performance from Boeing provides us with tremendous fleet flexibility, and we're leaving our full year CapEx forecast unchanged at this time at $435 million. In light of staffing costs incurred in 2024, we made the conscious decision at the start of the year not to hire additional flight crews for these aircraft and plan for pilot transitions after our summer peak schedule, and thus we expect to place the remainder of these aircraft into service alongside available type rating flight crews beginning in October. In October, we transition our Fort Lauderdale base to an all 737 MAX operation. Looking ahead to the third quarter, as previously announced, we entered into a definitive agreement to sell Sunseeker Resort for $200 million with closing plans for early September and expectation for sales proceeds to be used for debt repayment. We will report consolidated and airline-only results for the third quarter, which we expect will include approximately two months of operating losses at Sunseeker during its off-peak season. As most of you know, the third quarter is seasonally our softest. While we've recently seen some strength in bookings, much of July, our peak month, would have been booked before a notable increase in demand was observed. As such, the benefit to the third quarter is somewhat muted, though we expect to capture some upside in our full year guidance, which I'll discuss in a moment. For the third quarter, we expect a consolidated loss per share of $2.25, including a loss of approximately $0.50 from Sunseeker. For the full year 2025, we are expecting airline-only earnings of greater than $3.25 per share. Factoring in eight months of operations at Sunseeker, we expect consolidated full year earnings per share above $2.25. Our outlook today contemplates some of the demand improvement observed in July. However, we believe there's still room for upside, particularly during the fourth quarter if macroeconomic conditions continue to improve. Although it's still too early for us to guide 2026, we will share that we expect to retire eight A320 family aircraft and plan to induct nine incremental MAX aircraft into the operating fleet next year, weighted to the back half. As a result, we do not expect fleet count to drive capacity growth next year. With continued progress on revenue initiatives, the earnings drag from Sunseeker removed, and an improving macroeconomic backdrop, we believe we're well positioned to deliver materially higher earnings in 2026. In closing, I want to thank the entire Allegiant team for their efforts during our peak summer travel season. We operated a record number of flights this summer and the operational performance exceeded expectations. D espite a nearly 17% increase in fleet utilization and flat employee headcount, w e operated nearly 16% more flights compared to 2024 and did so with significantly fewer operational disruptions. From cost discipline to operational execution, we're proving our ability to adapt, execute, and position Allegiant for long-term outperformance. With that, Greg, this concludes management's prepared remarks. We can now go to analyst questions. Thanks, Robert. At this time I would like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. Once again, star one. In the interest of time, we ask that you please limit your questions to one primary and one follow-up question. Thanks in advance. Excuse me. We will pause just a moment to compile the Q&A roster. Okay, looks like our first question comes from the line of Mike Linenberg with Deutsche Bank. Mike, please go ahead. Yeah. Hey, good afternoon, everyone. Hey. Just on the numbers for the full year, you have the consolidated at greater than $2.25 and the airline greater than $3.25. I guess Sunseeker has already lost over $1 per share for the first half of the year. There's another $0.50 in the third quarter for the last two months. I guess what's—I see the dollar difference, but I guess, you know, you sort of left the gap at that point. Maybe that was by design. Hey, Mike, it's Greg. Let me kick it off and BJ or the team could jump in. What we're expecting for our guide is that at the end of September, by September, that Sunseeker is no longer a part of Allegiant and excluded obviously moving forward in earnings. I think that's the way it was built. If we need to go kind of more into detail, we could do that certainly offline. What the guide suggests, you have our third quarter number, but I believe on the EPS what it would suggest is about a buck and a quarter in airline-only EPS. Okay. Okay, thanks then. Th en, just my second question on Sunseeker itself. I mean the 8K that came out talked about, you know, I guess cash proceeds of $200 million. I'm not sure if there was anything else tied to that. If there's a residual stake, I mean, is it clean $200 million coming in? Are there some other impacts there? How should we think about it? Just because, you know, the original 8K was fairly terse in providing details around that transaction. Thanks. Thanks for taking my question. Yeah, of course, Mike. It's all 100% sold to Blackstone and that's the sale agreement and then the $200 million are proceeds to Allegiant upon close of the deal. All right, thanks, Mike. Our next question comes from the line of Savi Syth with Raymond James. Savi, please go ahead. Thank you and good afternoon everyone. Maybe I can kind of talk a little bit about the 2026 kind of way you're thinking about it. Appreciate that color this early on. Just curious, your cost execution this year has been remarkable. Given the kind of the flat outlook, how should we think about non-fuel costs next year? Given that you still don't know what the pilot deal might look like, how should we think about puts and takes into 2026? Sure. Thanks, Davi. Yeah, one of the reasons we're not prepared to guide 2026, of course we're still just actually kicking off our budget initiatives now, but also just fully understanding what capacity is going to look like next year. Remember we had a good bit of off peak capacity during certain periods in 2025, and based on the current environment we wouldn't expect to see that. I'm just trying to get a handle around aircraft and team member utilization. Keep those in mind, and then timing of a pilot yield as you mentioned in the question. Anything else? A s we think about some of the cost savings that you have this year, do any of those get reversed next year, or is there kind of a rule of thumb if you did not have any of those moving parts, just how much unit cost pressure you see? I mean we expect the where you're seeing the most benefit on a unit cost basis this year is in the salaries and wages line. I would expect that the total cost for that line, I don't want to commit to it being flat, but I don't expect it to be up materially and on lower utilization. If we have lower utilization or lower ASMs, you would see some pressure there. Again, this just depends on what kind of capacity we put out there. Savi. Hey, it's Greg. I might just add just a more high-level comment and team's probably heard me say this too many times, but everything at an airline begins and ends by running a great operation. I think from a cost perspective it can get pretty expensive quickly when we don't run a good ops. I'm really proud you're hearing some of the operational performance that we're seeing and the improvements we've seen over the past couple years that's helped drive a lot of our costs out of the business. That's step one next year and giving us even some more confidence to fly a little bit more in those peak periods, given that the OPS performance. One of the things that I think I want to say as well is just the organization has been incredibly focused on just driving unnecessary costs out of the business. BJ and his team, the team of cost hawks, and we've seen, you know, closed a couple of high-cost bases like LAX and Austin. We've reduced corporate personnel over the past year by 10%. We've reduced fixed marketing expenses and we've reduced IT spend. There are areas in the business that structurally we've gone through and they've done a really nice job. What I am, I guess, very encouraged by is the culture where everyone's looking to, you know, really be prudent on the cost front. Maybe one more quick addition to the answer there, Savi. This one I can give you to help with modeling. I mentioned in the prepared remarks an increase in the aircraft rent line. I would expect that to persist through the back half of this year, maybe a little bit of relief in the fourth quarter, but in 2026 we should see that return to the same run rate that we had in 2024. Very helpful, thank you. All right, thanks, Svi. Our next question comes from the line of Duane Pfennigwerth with Evercore. Duane, please go ahead. Hey, thank you. On the growth headwind to RASM of 5 points, I assume that's a 2Q comment and this might be impossible, but how would you frame that maybe earlier in the year and even into third quarter here? Is it fair to say that the year to date impact is probably in a similar range to that 5 points? Yeah, Duane, I think that's probably fair. Year to date, just looking at the severe offseason like September, we didn't have that same comp in January as we were still kind of thriving from a booking perspective, so we're kind of forecasting that you see it similar but slightly improving through the quarter to a point, maybe a little bit better than that 6% that we put up in the. Got it. On some of the cost leverage, because I thought the driver of the growth this year was really about legging into the investments that you already made in support of this transition for the MAX. Would you say there's still cost leverage to achieve based on investments you've already made? I mean, you are effectively growing the MAX sub fleet in 2026, shrinking on the Airbus side. It doesn't feel like your average flat capacity year, maybe from a CASM perspective. Maybe just talk about what inning we're in in sort of getting cost leverage on the MAX investments you've already made. Thanks for taking the questions. Thanks, Duane. I'm happy to start, Greg, if you want to add in. For early innings, for sure. I think Greg gave the percentage of ASMs that were operated by the MAX, but certainly expect that to be up in the 20% range next year. There's definitely room to grow. We're also not able to schedule the MAX aircraft on the most optimal lines of flying yet because we're still training crew members and the airplanes are operating shorter stage lengths, which is not optimal for the fuel burn performance of that airplane. I think there's definitely room to go. I would just stay on the DNA side. You gotta remember there's also a little bit of overlap in the second quarter of this year. We had a one-time true up on some unrelated assets. There's a little bit of a bump in the second quarter. I would expect to see some relief there in the third quarter. As we move into next year, you see some of the Airbus assets start to fall off from the DNA line. Duane, I'd just add maybe a little more specific on the cost improvements to BJ's point. We're up to next year about 20% of our ASM flown by the more cost efficient MAX fleet. We'd expect ASMs per gallon next year to improve by, call it, 2% to 4%. I think in 2027 you would expect that to step up even further. I think our tentative plan has us between 7- 9 points or 7- 10 points in ASM per gallon improvement. Thank you. Thanks, Duane. All right, thank you, Duane. Our next question comes from the line of Ravi Shankar with Morgan Stanley. Ravi, please go ahead. Good afternoon, everyone. Not asking you to guide for 2026, but do you have a sense of what your normalized EPS might look like? One of your peers quantified it on their call for 2027. Also, what might that be dependent on in terms of moving parts? Hey Ravi, why don't I kick it off? We're not going to give a guide right here. I mentioned a lot of the initiatives as we think about 2026 or perhaps items to keep an eye on. We mentioned we believe there's a clear path to improving unit revenue and we're going to keep a tight lid on costs. You've seen the team and the performance this year and we want to continue to really run a great operation. The flattish capacity is not going to put any pressure, we don't think, on the operations. We can fly a little bit more in the peak period. We think, given what we're seeing on the operational front and Drew and his team, others are starting to think about and plan towards 2026 right now. If the demand backdrop improves, particularly leisure, you'd still have some flexibility to push some utilization in the shoulder, not peak. We're not planning on that today, but what I'd say is just you kind of put it all together. Ravi, I know this isn't giving you a specific answer, but we think there's an opportunity to materially improve our earnings. EPS for us, we have 18 million shares, so you could kind of back into, here and there, each one of these levers is worth X points in EPS, just all else being equal. Understood, that's helpful. Maybe as a follow up clarification, just on 3Q on the demand environment, are you saying that the 3Q you've guided to is essentially what a normal 3Q non-peak environment looks like or do you think we're still seeing drags from what happened the first half? Just trying to get a sense of what that sequential step through 2Q, 3Q, 4Q looks like relative to what you think normal would be. I'd probably caution normal for sure. What we're thinking about for the third quarter is a ramp in demand similar to what we experienced last year. 2024 was not particularly normal. As we talked about a year ago, we're starting from a little bit of a lower point. Getting a slightly stronger ramp I think will get you to that sequential TRASM year-over-year benefit that we talked about. I don't think we're quite normal yet. Very little post-pandemic feels normal at all. Looking forward to 2024 is kind of the guiding principle there more than anything. Very good, thank you. Thank you, Ravi. Our next question comes from the line of Scott Group with Wolfe Research. Scott, please go ahead. Hey, thanks. Afternoon. I apologize I missed this, but maybe can you just repeat sort of how you're thinking about RASM and CASM in Q3 and I think you had a point that things are getting better but maybe you're not going to see the same benefit of things getting better maybe as much as others. I just didn't follow that point. If you can just go through that again. I'll start on the RASM side. Really, Scott, what that comes back to is how we deploy our capacity, right? 42% of our ASMs for the quarter will come in July, leaving only 58% for the rest of it. As demand ticks up, we don't have the same flat kind of schedule that many other carriers do that would enable them to better feel a third quarter impact from that uptick. That was really the extent of that commentary. More generally, maybe, I think in the remarks I mentioned, you would expect sequential wins on year-over-year as we get into the third quarter and then the fourth quarter getting just a little bit better than each of those. Hey, Scott, it's BJ and then on the cost side, we did not guide unit metrics for the quarter, but I will tell you that I gave a bit of a cadence of unit costs at the first call this year, the fourth quarter 2024 earnings call. I'll just kind of repeat that so it's out there. We expected at the time first quarter to be down the most, second quarter to be down not quite as much. We had talked about the fourth quarter coming in maybe flat and that did assume a little bit higher capacity. We've pulled some capacity out since then, but I think those comments will largely hold. I said in my prepared remarks that we would expect the full year that ended with down mid single digits. Okay, that's helpful. Secondly, I think you had a comment about fourth quarter capacity in leisure markets looking higher, maybe just any more color there? I just want to sort of, like, if I look at the Q4 guide of a dollar plus of airline earnings, obviously a big improvement from Q3, but still a big decline from fourth quarter last year. That just feels a little different than what some of the other airlines have guided or just any thoughts or color? Yeah, I mean some of that's just going to come down to a belief in what the full ramp is going to look like. I think we maybe have a slightly more conservative view on where the fourth quarter can end up. Just looking at visual oriented markets, that's a pretty big change. For example, the Orlando area that was down 10% fourth quarter last year, now showing up 7, 7.5% at an industry level. A little bit of a different dynamic, I think, in the geography of where seats are still in the market. That's all subject to change. That just kind of lives in the back of my mind as something that maybe it's reason for us to be a little more cautious as we go into November, December than maybe holiday airlines have described it. Okay, great. I apologize. If I can just sneak one last in. Just going back to my first question, like, relative to the RASM down 11% or whatever in Q2, how much sequential improvement are we talking about? Is it five points? Is that a good ballpark? Is it more or less? Any thoughts just to give us a little bit of help? Yeah. Probably won't go into trying to guide an actual number here, though I appreciate the question. Do you think it'll be better? A lot of this will come down to your view on how good you think September can be in a typically leisure week period. Like I said, we're planning on something roughly similar to what we saw in 2024 as a kind of a ramp from this point forward in terms of demand. That may be as far as I take it. Okay, great. Thank you, Scott. Our next question comes from the line of Andrew Didora with Bank of America. Andrew, please go ahead. Hey, good afternoon, everyone. Thanks for the questions here. This first question for Drew, when you look at all the commercial initiatives you outlined in your prepared remarks, whether it's Allegiant Extra, more peak flying, now you have Navitaire operating as you initially thought, how should we think about whether it's RASM or maybe it's ancillary per passenger? How do you think about the uplift from all these initiatives in kind of a status quo demand environment as we head into 2026? How should we think about that? Sure. On the Navitaire front, we had already talked about that being less than the ancillary per passenger line. I think what we've seen is actually a little bit more coming in load factor and conversion, which may actually put a little pressure on air per passenger or ancillary per passenger. It's good for the overall as we can drive incremental bookings. That's a little bit, candidly, of a change. We had to call that out as the $2 to get back to level and then an incremental $2 per passenger. We might have to start to shake that a little differently given we're seeing it come through to load instead. On the Allegiant Extra, that's purely an ancillary revenue per passenger metric. We're still holding pretty strong at roughly $3 per passenger on flights with the Allegiant Extra layout, coming out to $500-ish per departure. That number is still intact on that front. Thank you. Second question for BJ, thanks for the color on the higher lease costs in the quarter. I was going to ask you about that, but got me thinking, when you think about you have the MAXs coming in, would you ever consider leases or sale leasebacks as a way to finance future deliveries, or are you still 100% committed to the full-on ownership? Thanks. Yeah, thanks Andrew. The answer is yes, we will always consider. We revisit it two to three times a year. At this point, it's our view that over the long term, over the full useful life of the aircraft, it's two times as expensive to lease airplanes as it is to own them. So long as the balance sheet allows us to own aircraft, I think you will continue to see that from us. Doesn't mean that we won't diversify our funding sources or be opportunistic here or there. We have an order for 50 firm aircraft. I can envision a few of them on operating leases by the time we take the last one, but at the moment we don't have any plans to use sale leaseback. Andrew, it's Greg. I might just add a quick comment at a high level on that as well. Our strategy is not only to be really good at operating aircraft but very opportunistic trading assets and aircraft. We like to own; that provides us flexibility, but there's a lot of embedded value in our fleet. One of the things that I've been, EJ and team as we talk about capital allocation, I've been doing a really nice job is selling some of our underutilized assets in a very high market or hot market to help us buy aircraft we ordered at the bottom of the market. That's been helpful as well. The thing that's most impressive is they're looking at every which way to be opportunistic and they're on their game. All right, thanks Andrew. Our next question comes from the line of Conor Cunningham with Melius Research. Conor, please go ahead. Hi everyone. Thank you. I was hoping to ask about the booking curve and maybe tie it into a couple other questions that you had. I'm just trying to understand, is the booking curve normal at this point? The question that I think a lot of us are trying to figure out is just how much do you have left to book in 3Q? I realize that July is obviously your most important month, but if you could just talk about where you are at 4Q and is that comping up on what you currently have? I'm just trying to understand what's out there right now. You've kind of struck a more cautious tone, which is fine, but I'm just trying to benchmark where we're at. Thank you. July, the one I'm most confident in responding with 0% left to book for the rest of the quarter. August and September we probably have something in the 35% - 40% left to book there, so certainly still some room. It's starting to get dark on that booking window. Fourth quarter, still a lot to go. We're 85% left at that point, so there's still a lot to learn. Like I kind of said in the previous response, a lot of fourth quarter right now is just about trying to forecast how a lot of things are going to unfold just because of the industry setup. It looks a little bit different for such a leisure-oriented carrier than maybe one that has a business outlook or more hub-oriented where you've seen seats kind of come down this year relative to others. It's just enough for the back of my mind to say, hey, maybe this does look just a little different as we get to the end of the year. Conor, I would just add a brief comment to that as well that if you take the suggested EPS guide for the fourth quarter, it's below both the first quarter, second quarter of this year. Scott mentioned, he called out rightfully so well below fourth quarter of last year. Just back to Drew's point, there's still a lot left to book and our guide suggests a modest improvement in leisure demand. We're keeping a close eye on it and we're going to do everything we can to maximize the fourth quarter earnings. Maybe just to get back to your booking curve question, we saw a lot of compression last year where we were down, probably medium booking curve down 7%, 8%, something like that. We felt relatively flat with that kind of close-in proportion. We haven't seen quite the same surge that you've seen from others, but it's normalized with what we saw last year, which was a surge that maybe I don't know if others saw or not. It wasn't quite as popular. Okay, appreciate it. Maybe on the comment that you need to earn the right to grow, I was just hoping that you could potentially benchmark what that means to you. Is there a margin target, a return on invested capital target that you're looking at that would give you the green light to grow again? I'm just trying to understand maybe long term, when does Allegiant start to go back at this 10%- ish number that you've historically been at for some time? Thank you. Thanks for the question, Conor. I don't think we're ready publicly to go out there with the benchmark. What I would tell you is how we're looking at it internally. It's kind of a couple factor fold. One is margin. How do we get back to restoring our historic margin performance? Others, balance sheet. We want to continue to strengthen and improve our balance sheet. Obviously, improving margin helps in that regard. The others are cost of capital and what that looks like. You kind of put all that together and you balance the environment and some of the items that we mentioned before, just being disciplined. I don't think Allegiant is dependent on high growth. I think we're able to produce solid margins with growth or without. With that said, we want to maintain flexibility and as the demand environment fluctuates, we want to be able to adjust accordingly and continue to focus on initiatives that'll help us drive more margin. Our moat around our airline that we talked about for many years is our model and our team members, and last quarter we talked about the four cornerstones that kind of fortify that moat and what is that in the network? Tactical utilization, fleet flexibility, and having, you know, low cost structure. Conor, that's what we're incredibly focused on, simplifying the business. Continue to strengthen those four cornerstones. We talked about how we're doing that today with more, you know, obviously initiatives down the road as well. We think you put all that together, that'll continue to help us improve and drive more earnings and earn that right to grow, as you said. Appreciate it. T hank you. Thanks, Connor. All right, thank you, Connor. Our next question comes from the line of Tom Fitzgerald with TD Cowen. Tom, please go ahead. Hey, thanks so much for the time. It's kind of picking up with that last response to Conor's question. Should we be expecting an investor day in the next, like, 12 to 18 months and just, you know, you are at an interesting point in the road and would you look to just focus on these, like, kind of asset light opportunities and like a low growth organic story, or would you be open to any M&A at all? Thanks again for the time. Hey, Tom, thanks for the question. You can't obviously see us, but there's a couple smiles across the table because we've been talking about that for some time. In fact, you know, Drew and BJ and I, we want to get something scheduled in the not too distant future because we think that'll be incredibly helpful to walk through. Obviously, we're viewing the business in long term as well, and the initiatives that we think could help be a little more accretive. We've held off on that just given some of the, I guess, idiosyncratic issues that we've been facing or constraints we've been facing. We're now working through those and the story's kind of clearing up a little bit more. I think my point of going into that detail is, yes, that's the plan. We don't have anything set. I wouldn't expect it in the coming months, but I would expect in the next year to 18 months or so, maybe probably within the next year we would have something scheduled for an investor day. I think on your M&A question, I thought I heard an M&A question in there. We get asked quite a bit about that. I would say I think there's a degree of consolidation that could be positive for the industry. I think right now less supply would be better, particularly in the domestic leader space. I think for Allegiant, we're continuing to be profitable. Not all airlines right now are durable. I think we're a very durable model and airline and we're producing healthy earnings. Candidly, my focus, this team's focus, is more about improving our margins, getting third quarter back to profitability. If you recall, pre-pandemic, we had what, 68, 69 consecutive quarters of profitability. We need to get third quarter back where it needs to be. We're taking measures to do that. I don't think consolidation is required for us to get back to those historical margin levels. That said, as we always do, we look to expand and drive more shareholder value and whatever that looks like we keep a close eye on all the time. Great. Thank you so much. Those are both of mine. Thanks again. All right, thank you, Tom. It looks like our final question today comes from the line of Chris Stathoulopoulos with Susquehanna. Chris, I hope I got your name right. Please go ahead. That's right. Thanks. Thanks everyone. On the next year's outlook, flat capacity and apologies if you went over this but if you could help parse that out. I guess the usual input stage, gauge, departures, and then if you could, peak versus off-peak and new versus existing markets. Thank you. I love. I'm going to have all that in front of me to share with you right now on the new versus existing. Right now we're running about 5.5% of our available seat miles being in new markets. Obviously some of that will start to come off but something mid singles is probably fine for an overall outlook on that front. Stage, off the top of my head, I don't think we'll see stage change much. We'll see a slight increase in gauge as we move into the MAX at 190 seats when we retire some 177 seat aircraft. I don't know that there's a lot of moving parts in there. The only other thing I might add, Drew, is that we would expect as you're planning right now a higher mix of peak flying versus off-peak flying proportional year over year. What gives us, at least for me, a lot more confidence in that is just back to how the operations have performed this year in those peak periods. We pushed it significantly and we wanted to make sure we could achieve that. The team, the front line, and the operational teams have done just a fantastic job with the same overall infrastructure and they continue to improve processes, systems, and continue to strengthen that foundation. Part of how the team are planning is there's an ability even on that same infrastructure that we could push a little bit more in those peak periods. I think they're planning as such. Back to an earlier comment, this is based on, you know, if the demand and backdrop improves, there's still opportunity to push utilization in the shoulder and off peak periods. Again, we're planning to drive as much in the peaks as we can next year. I think I heard you say on the MAX piece, the percentage of your total fleet or capacity, was that 20% for next year? I didn't mention that. I don't know if anybody had enough for next year. You had that number. Oh, on the MAX fleet. I'm sorry, I thought you said peak flight. Yeah, yeah. MAX fleet, we expect. I'm sorry, Chris. Yeah, the MAX fleet. We expect 20% of our ASMs to be produced with the MAX aircraft. Okay, but overall at the system level, flattish on gauge at this point? No, I think we'll see gauge come up just a little bit because we're retiring aircraft with 177 seats and adding airplanes with 190. Okay, so my second question. The materially, materially higher, excuse me, earnings for next year. I realize you don't want to, you know, you're still early stages here. What I heard was so qualitative. Flat capacity. We have loyalty benefit at this point, assuming steady state economy, leisure, let's say sideways to light seasonal outperformance, Navitaire. Maybe on the utilization piece, any color you can give on how you're thinking about utilization or perhaps on load factors. Are we at a point where there's a, I guess, sustained and permanent return to kind of that low 80s system load factor or any color really on how you're thinking about utilization at this point here, in addition to what you've said about Navitaire, loyalty and everything else. Thanks. Utilization will effectively ebb and flow with the off peak percentage of flying. Right. That's the easiest flying. That's a plug into the schedule. We'll be able to do a little bit longer peak days like Greg mentioned, but I would expect utilization maybe slightly lower given the lower portion of off peak day flying in the schedule. With that, yes, there should be, as long with the flat capacity, there should be some load factor benefits. We talked a little bit in my remarks about July, seeing that improvement and the Navitaire helping to drive conversion, which is turning into load factor as well. Good to have a line of sight to that. It may take a few months to get back to the levels we really want to be at. Yeah, there's their line of sight. At this point, just you'd said earlier, I think fourth quarter's 85% left. It sounds like 15% or so is on the books. Yeah, that's good for a semi round number. Okay. Thank you. Thanks. Thank you, Chris. We did have one additional caller jump into the queue. Atul Maheshwari with UBS has a question. Atul, please go ahead. Oh, thanks for squeezing me in. Good afternoon everybody. Two quick ones really. First, you're expecting a similar level of BRASM acceleration in the fourth quarter like you saw last year. Question is, how much confidence do you have that this acceleration will come through. Last year you had about, I'm looking at the model correctly, 300 to 400 basis points improvement, like sequentially from 4Q to 3Q. Are you already seeing yield improvement in recent bookings that's commensurate with this level of acceleration? Or any other color that you can provide that helps us get more confidence about the implied fourth quarter ramp. I mean we've certainly seen the uptick in demand happening across the selling schedule. Just bear in mind, it's 15% for the entirety of the fourth quarter. Right. You're looking at more than 90% left to go for December. Try not to run away with the small sample size theater. It looks fine in the small sample we do have. Okay. As a follow up, in 2023 you earned well north of $7 in EPS. Do you think you were over earning then or is that level of EPS something that you expect to achieve in the next couple of years? Somewhat related to this, what elements of the business that drove that $7 plus in EPS a few years back that is maybe not going to repeat going forward? What are some of the things that were missing then that you expect to drive earnings in the future? Hey Atul, it's Greg. I could kick it off at a high level. I think 2023 had a, I'm looking at Drew, had a very strong demand backdrop. A lso, 2023 is when we began nearly mid year, I want to say in May. On the full year we started accruing a 35% increase for our pilots in terms of pay. That'll, as we're in our negotiations, but kind of just putting it all back together, what we talked about in the focus again, the areas whether that be flying more in the peak period, the operational performance, all the commercial initiatives, the cost discipline, bringing on more MAX aircraft, growing the loyalty program, technology advancements of all of that, better productivity. We see a path where we said today to continue to grow and expand our earnings. We see that we expect to be able to get back to where we were and were in historical performance. I don't want to come out and give a guide and say, hey, we're going to be in 2023 by, we're going to recapture 2023 EPS by this year or that year, but we expect to get back to where we were and that's what we're working towards. Great, thanks for that and good luck with the rest of the year. Thanks. Thank you. That does conclude our Q&A session for today. I will now turn the call back over to Sherry Wilson for closing remarks. Sherry. Thank you all for joining the call. We'll speak again next quarter. Thanks, Sherry. Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.