What changed in this filing

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Item 1. Business

2025-03-03 compared with 2024-02-29 · 210 added, 207 removed, 347 unchanged (55% of the section changed)

We are a leisure travel company focused on providing travel and leisure services and products to residents of under-served cities in the United States.

Our vision is to be the leading airline in the communities we serve, offering reliable, nonstop travel at unbeatable value.

We were founded in 1997 and, in conjunction with our initial public offering in 2006, we incorporated in the state of Nevada.

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We provide scheduled air transportation on limited-frequency, nonstop flights predominantly between under-served cities and popular leisure destinations.

As of February 1, 2024, our operating fleet consisted of 126 Airbus A320 series aircraft.

As of February 1, 2025, our operating fleet consisted of 119 Airbus A320 series aircraft and four Boeing 737 series aircraft.

As of that date, we were selling travel on 577 routes to 122 cities.

Of these routes, 428 of them are unique routes which do not have any current nonstop competition.

Of these routes, 432 of them are unique city pairs which do not have any current nonstop competition with other airlines.

In this document, references to "Airbus A320 series aircraft" are intended to describe both Airbus A319 and A320 aircraft.

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We provide unbundled air-related services and products in conjunction with air transportation for an additional cost to customers.

These optional air-related services and products include baggage fees, advance seat assignments, our own travel protection product, change fees, use of our call center for purchases, priority boarding, a customer convenience fee, food and beverage purchases on board, and other air-related services.

These optional air-related services and products include larger seats, baggage fees, advance seat assignments, our own travel protection product, change fees, use of our call center for purchases, priority boarding, a customer convenience fee, food and beverage purchases on board, and other air-related services.

We also offer certain bundles of air-ancillary products where customers can choose popular combinations of these products at a discounted price to the combined individual prices.

The revenue for ancillary air-related products and services is reflected in the passenger revenue income statement line item, along with scheduled service air transportation revenue and travel point redemptions from our co-brand Allegiant credit card and our non-card loyalty program.

Third party products and services.

We offer third party travel products such as hotel rooms and ground transportation (rental cars and hotel shuttle products) for sale to our passengers.

We offer third party travel products such as hotel rooms, ground transportation (rental cars and hotel shuttle products) and travel insurance from a third party insurer for sale to our passengers.

The marketing component of revenue related to our co-brand credit card is also included in this category.

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We provide air transportation through fixed fee agreements and charter service on a year-round and ad-hoc basis.

Allegiant 2.0

We continue to sharpen our focus on offerings to meet more of the travel and leisure needs of our customers.

We have coined this next stage of our Company strategy as "Allegiant 2.0" which includes the following Company goals:

Allegiant ONE

We continue to sharpen our focus on our strength - our unique airline and seeking to return to historical margins.

We have coined this next stage of our Company strategy as "Allegiant ONE" which currently includes the following Company goals:

• maintaining our foundation of providing affordably accessible all-nonstop air travel while refining and strengthening our air travel product

• expanding our already broad domestic network as we have identified more than 1,400 incremental routes of which approximately 77 percent currently have no nonstop service;

• expanding our travel company focus and offerings with the operation of Sunseeker Resort at Charlotte Harbor (the "Resort" or "Sunseeker Resort");

• expanding our already broad domestic network as we have identified more than 1,400 incremental routes of which more than 75 percent currently have no nonstop service

• earning the right to grow by seeking to restore historical margins and strengthening our balance sheet

• taking advantage of the foundational technology we now have in place to leverage and embrace advancing technology (such as AI) to offer increased value to our customers and be able to scale more productively

• increasing peak period service to 1,000 daily departures over time once we feel we have earned the right to grow

• achieving at least 15 percent of new revenue from sources other than capacity growth

• seeking to offer (subject to government approval) transborder international scheduled service to premier beach destinations in Mexico through our partnership with VivaAerobus

• utilizing our customer data to capture accretive, asset-light direct-to-consumer revenue opportunities by offering vacation packages that include hotel stay and car rental;

• transforming our eCommerce strategy to create a frictionless experience for our customers and drive increased air ancillary and third party revenue generation;

• utilizing our customer data to offer personalized and more attractive product offerings

• transforming our eCommerce strategy to create a frictionless experience for our customers and drive increased air ancillary and third party products revenue generation

• expanding our award-winning co-brand credit card program and our non-card loyalty program

• maximizing return from our marketing investment dollars by entering into dynamic agreements, such as the naming rights agreement with the Raiders of the National Football League for Allegiant Stadium in Las Vegas

• revisiting our marketing strategy to be more surgical and measured

• seeking to remove Sunseeker Resort at Charlotte Harbor (the "Resort" or "Sunseeker Resort") from our balance sheet through a sale or stake sale on acceptable terms

Our principal executive offices are located at 1201 N.

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Our website address is included in this document for reference only.

Our annual report, quarterly reports, current reports and amendments to those reports are

made available free of charge through the investor relations section on our website as soon as reasonably practicable after electronically filed with or furnished to the Securities and Exchange Commission (“SEC”).

Our annual report, quarterly reports, current reports and amendments to those reports are made available free of charge through the investor relations section on our website as soon as reasonably practicable after electronically filed with or furnished to the Securities and Exchange Commission (“SEC”).

Unique Business Model

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Business and leisure Leisure

Primarily large and mid-sized markets Primarily small/medium-sized under-served markets

Primarily large and mid-sized markets Almost all routes serve small/medium-sized under-served markets

Flight Connections:

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We operate to more cities than any non-legacy U.S.

carrier, protecting us against overexposure to any one geographic location.

carrier and with more than 75 percent of our routes not having nonstop competition.

This makes us an important travel option for a large cross section of the country and protects us against overexposure to any one geographic location.

Our 23 bases spread throughout the country provide us the flexibility to redeploy capacity to best match demand trends around the country.

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This is enabled by our highly variable cost structure which allows us to increase capacity in high demand periods.

This has resulted in our being able to generate a disporportionate portion of our operating income in the peak periods including March, summer (June and July) and the holiday seasons.

This has resulted in our being able to generate a disproportionate portion of our operating income in the peak periods including March, summer (June and July) and the holiday seasons.

Our core business model manages seat capacity by increased utilization of our aircraft during periods of high leisure demand and decreased utilization in low leisure demand periods.

By way of illustration, in 2023, during our peak demand period in July, we averaged 7.4 system block hours per aircraft per day while in September, our lowest month for demand, we averaged only 4.5 system block hours per aircraft per day, which is almost 40 percent less than the average system block hours in July.

By way of illustration, in 2024, during our peak demand period in June, we averaged 7.8 system block hours per aircraft per day while in September, our lowest month for demand, we averaged only 4.5 system block hours per aircraft per day, which is approximately 42 percent less than the average system block hours in June.

During 2025, we expect to increase peak period utilization closer to 2019 levels.

Our management of seat capacity also includes changes in weekly frequency of certain markets based on identified peak and off-peak travel demand throughout the year.

Unlike other carriers which typically provide a fairly consistent number of flights every day of the week, we manage our capacity with a goal of being profitable on each route.

Unlike other carriers which typically provide a consistent number of flights every day of the week, we manage our capacity with a goal of being profitable on each route.

We do this by flying only on days with sufficient market demand.

In 2024, we were able to profitably fly a disproportionately low 11 percent of our scheduled ASMs on off-peak days (Tuesdays and Wednesdays).

To effectively hedge against fuel cost increases, during periods of high fuel cost we will often pull back capacity, particularly in off peak periods, and focus our flying in peak periods which drives higher fares to offset the fuel cost increases.

To effectively hedge against fuel cost increases, during periods of high fuel cost we will often reduce capacity, particularly in off peak periods, and focus our flying in peak periods which drives higher fares to offset the fuel cost increases.

Conversely, during periods of lower fuel costs, we will increase flying in off-peak periods as marginally profitable flights will become more profitable with lower fuel costs.

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In evaluating our cost performance, our management team typically compares to the following other publicly held domestic airlines:

Delta Air Lines, American Airlines, United Airlines, Southwest Airlines, JetBlue Airways, Alaska Airlines, Hawaiian Airlines, Spirit Airlines, Frontier Airlines and Sun Country Airlines (which we refer to as the "Industry").

Our airline operating CASM, excluding fuel, special charges, and Sunseeker Resort) was 8.12 ¢ in 2023, which we believe is significantly lower than the Industry average.

Delta Air Lines, American Airlines, United Airlines, Southwest Airlines, JetBlue Airways, Alaska Airlines, Spirit Airlines, Frontier Airlines and Sun Country Airlines (which we refer to as the "Industry").

Our airline operating cost per available seat mile (CASM), excluding fuel, special charges, and Sunseeker Resort was 8.56 ¢ in 2024, which we believe is among the lowest in the industry and significantly lower than the legacy carriers.

We continue to focus on maintaining low operating costs through the following tactics and strategies:

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As of February 1, 2025, we own or finance lease all but 17 of the aircraft in our operating fleet.

In addition, we believe that we properly balance lower aircraft acquisition costs and operating costs to minimize our total costs.

Throughout our history, we have primarily purchased used aircraft with meaningful remaining useful lives, at reduced prices.

As of February 1, 2024, our operating fleet consists of 126 Airbus A320 series aircraft, of which 113 were acquired used and 13 were acquired new.

In December 2021, we opportunistically negotiated an agreement with The Boeing Company to purchase 50 newly manufactured 737MAX aircraft with options to purchase additional 737MAX aircraft.

In addition, we believe that we properly balance lower aircraft acquisition costs and operating costs to seek to minimize our total costs.

Throughout our history, we have purchased new and used aircraft opportunistically.

As of February 1, 2025, our operating fleet consists of four Boeing 737 MAX aircraft and 119 Airbus A320 series aircraft, of which 106 were acquired used and 13 were acquired new.

During the pandemic-impacted 2021, we opportunistically approached major aircraft manufacturers seeking proposals for new technology aircraft and engines.

The process culminated with our entering into an agreement with The Boeing Company ("Boeing") and CFM International ("CFMI") to purchase 50 newly manufactured 737 MAX aircraft with options to purchase additional 737 MAX aircraft.

We amended this agreement in 2023 with revised terms that now provide us with options to purchase up to an additional 80 737 MAX aircraft.

Under our contract with Boeing, deliveries of the initial 50 aircraft are expected between 2024 and 2025, but will likely be impacted by recent events affecting Boeing quality assurance and the certification process for the 737MAX-7 aircraft.

We amended this agreement again in 2024 with revised terms whereby all 50 firm aircraft orders are due for delivery by the end of 2027.

Our deliveries may be delayed by various factors including Boeing's ability to produce and deliver aircraft as scheduled.

See Item 1A – Risk Factors - " Regulatory review of Boeing's operations could delay its production schedule, which could impact us as any delivery delays may result in lower profitability than expected and delayed growth as well as bad publicity and other consequences." We believe this new aircraft purchase will be complementary with our low cost strategy.

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In addition, the expected fuel savings, improved operational reliability, and other savings expected from the use of these new aircraft should aid in improving our overall low cost structure, and the lower cost of operating this aircraft is expected to allow us to profitably add new service or routes.

We expect to continue to acquire used aircraft as necessary to support planned growth and aircraft retirements.

We continue to consider the acquisition of used aircraft as necessary to support planned growth and aircraft retirements.

Low distribution costs.

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We are continuing to focus on capturing data to identify trends and patterns in an effort to gain efficiencies and decrease costs.

For example, we utilize predictive maintenance to identify necessary aircraft maintenance before a problem arises, thereby avoiding unscheduled maintenance events which are costly and disruptive to our schedule.

In addition, our direct to consumer distribution method results in enhanced data which helps us deepen our relationship with our customers and increase sales.

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We aim to build our scheduled service so that substantially all of our crews and aircraft return to base each night.

This allows us to maximize crew efficiency, and more cost-effectively manage maintenance, spare aircraft and spare parts.

This allows us to optimize crew efficiency, and more cost-effectively manage maintenance, spare aircraft and spare parts.

Additionally, this structure allows us to add or subtract markets served by a base without incremental costs.

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however, customers who value this product can purchase advance seat assignments for a small incremental cost.

One popular ancillary product offering is our extra legroom option, Allegiant Extra, which offers an additional six inches of seat pitch, reserved overhead bin space, and priority boarding on select routes.

As of December 31, 2024, 56 of our aircraft have been fitted with the Allegiant Extra configuration.

In addition, snacks and beverages are sold individually on the aircraft, allowing passengers to purchase only items they value.

Our direct to consumer distribution method enables a variety of added revenue opportunities with direct “one-stop” shopping solutions and managed product offerings.

We offer various bundled ancillary products whereby customers can elect to purchase multiple ancillary products at a discount.

We offer various bundled ancillary products allowing customers to elect to purchase multiple ancillary products at a discount from the combined prices of the individual products.

Revenue from ancillary items will continue to be a key component in our total average fare as we believe leisure travelers are less sensitive to ancillary fees than the base fare.

Our third party product offerings give our customers the opportunity to purchase hotel rooms, rental cars and airport shuttle service.

Our third party product offerings give our customers the opportunity to purchase hotel rooms, rental cars and airport shuttle service as well as travel insurance from a third party.

Our third party offerings are available to customers based on our agreements with various travel and leisure companies.

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We had net debt (total debt and finance lease obligations less cash, cash equivalents and investment securities) of $1.23 billion as of December 31, 2024.

As of February 1, 2024, we have $275.0 million of undrawn capacity under revolving credit facilities plus another $25.1 million of undrawn capacity under our PDP (pre-delivery payments) facilities.

As of February 21, 2025, we have $225.0 million of undrawn capacity under revolving credit facilities, $25.1 million of undrawn capacity under our PDP (pre-delivery payments) facilities, and $87.5 million in committed aircraft financing facilities.

Routes and schedules

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Routes to Orlando (MCO & SFB)

Routes to Las Vegas 61

Routes to Tampa/St.

Petersburg 62

Routes to Las Vegas 55

Routes to Punta Gorda 50

Routes to Phoenix (AZA & PHX)

Routes to Destin 31

Routes to Sarasota 35

Routes to Destin 33

Other routes 223

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Core to Allegiant’s business model is our direct-to-customer distribution.

In lieu of the Global Distribution System (GDS) distribution points used by most airlines, allegiant.com is our primary distribution method.

This low-cost strategy results in significant cost savings by avoiding fees associated with GDS.

In lieu of the Global Distribution System ("GDS") and online travel agency ("OTA") distribution systems used by most airlines, allegiant.com is our primary distribution method.

This low-cost strategy results in significant cost savings by avoiding fees associated with the GDS or OTAs.

It also enables a variety of added revenue opportunities with direct “one-stop” shopping solutions and managed product offerings.

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Enhanced data and analytics are being streamlined into our digital advertising system to build more targeted campaigns driving efficiency in our digital media spend.

We can more surgically match our digital advertising dollars and the impressions they drive with the web users who are most likely to book their travel for the routes, to better optimize load and yield.

We can more surgically match our digital advertising dollars and the impressions they drive with the web users who are most likely to book their travel for our routes, to better optimize load and yield.

Whether introducing new service to a community or promoting existing routes, our advertising is often supported by cooperative marketing funding from airport authorities and destination marketing organizations.

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Cardholders are among our most engaged customers and book air ancillary and third-party products at a higher rate than other customers.

As of December 31, 2023, we had more than 485 thousand co-brand cardholders.

For five years in a row, Allegiant's co-brand credit card has been voted as the No.

1 Best Airline Credit Card and our non-card loyalty program Allways Rewards® was recently rated as the number two Best Frequent Flyer Program in USA Today's 10 Best Loyalty/Rewards Readers' Choice Awards.

As of December 31, 2024, we had more than 545 thousand co-brand credit cardholders.

For six years in a row, Allegiant's co-brand credit card has been voted as the No.

1 Best Airline Credit Card and in 2024, our non-card loyalty program Allways Rewards® was once again rated as the number one Best Frequent Flyer Program in USA Today's 10 Best Loyalty/Rewards Readers' Choice Awards.

Allways Rewards®, with more than 18 million members at December 31, 2024, allows us to develop and maintain direct, long-term relationships with our customers.

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Passenger demand and fare levels have historically been influenced by, among other things, the general state of the economy, international events, fuel prices, industry capacity, and pricing actions taken by other airlines.

The principal competitive factors in the airline industry are price, nonstop flights, schedule, customer service, routes served, types of aircraft, safety record and reputation, code-sharing relationships, and frequent flyer or loyalty programs.

The principal competitive factors in the airline industry are price, nonstop flights, schedule, customer service and on-board experience, routes served, types of aircraft, safety record and reputation, code-sharing relationships, and frequent flyer or loyalty programs.

Our competitors include legacy airlines, low cost carriers ("LCCs"), ultra-low cost carriers ("ULCC"), regional airlines, new entrant airlines, and to a much lesser extent, other forms of transportation.

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Competitors may also choose to enter after we have developed a market.

We believe our under-served city strategy and less than daily service has reduced the intensity of competition we might otherwise face.

We believe our under-served city strategy with less than daily service has reduced the intensity of competition we might otherwise face.

As of February 1, 2025, we are the only mainline domestic scheduled carrier operating out of the Orlando Sanford International Airport and at 12 other airports in our network.

We and Sun Country Airlines are the only mainline domestic scheduled carriers serving Phoenix Mesa Gateway Airport, Punta Gorda Airport, and St.

Petersburg-Clearwater International Airport.

Although no other mainline domestic scheduled carriers operate in these airports, most U.S.

airlines serve the major airport for Orlando, Phoenix, Fort Myers, and Tampa.

In each of Mesa Gateway Airport, Punta Gorda Airport, and St.

Petersburg-Clearwater International Airport, we provide more than 97 percent of the scheduled service in these markets.

However, most U.S.

airlines serve the major airports for Orlando, Phoenix, Fort Myers, and Tampa.

Allegiant and Breeze Airways are the only carriers at Plattsburgh International Airport (PBG), Portsmouth International Airport (PSM), and Stewart International Airport (SWF).

Allegiant and Avelo Airlines are the only carriers at Concord-Padgett Regional Airport (USA).

In addition, many U.S.

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As of December 31, 2024, we face mainline non-stop competition on approximately 25 percent of our operating and announced routes.

We overlap with Southwest Airlines on 77 routes, Spirit Airlines on 34 routes, Frontier Airlines on 33 routes, American Airlines on 17 routes, Breeze Airways on 17 routes, Delta Airlines on 16 routes, United Airlines on nine routes, JetBlue Airways on seven routes, Sun Country Airlines on five routes and Alaska Airlines on three routes.

We overlap with Southwest Airlines on 78 routes, Spirit Airlines on 28 routes, Frontier Airlines on 30 routes, American Airlines on 17 routes, Breeze Airways on 30 routes, Delta Airlines on 15 routes, United Airlines on 11 routes, JetBlue Airways on seven routes, Sun Country Airlines on five routes and Alaska Airlines on two routes.

In many cases, we face competition from more than one other airline on the same route, resulting in a total of 145 competitive routes as of that date and 440 routes with no current nonstop competition.

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The basis of competition in the fixed fee market is cost, equipment capabilities, service, reputation, and schedule flexibility.

Environmental, Social and Governance (ESG)

As an integrated travel company with an expanding airline business, we believe that solidifying our commitment to ESG efforts is a natural integration into our long-term corporate strategy and will enable us to better serve our stakeholders.

In 2022, we entered a 3-year partnership with Schneider Electric to develop a comprehensive ESG program including:

• Identify and prioritize relevant ESG topics through a materiality assessment.

These topics are included in our ESG reports.

• Publish ESG reports referencing the Global Reporting Initiative (GRI).

• Provide ongoing carbon emissions reporting of Scope 1, 2 and 3 greenhouse gas (GHG) emissions.

• Establish ESG targets and environmental target achievement plans, which we published in our 2022 ESG report.

In 2023, we issued our second annual ESG report.

This comprehensive report outlines our disclosures pertaining to material topics identified by key stakeholders and establishes the following ESG Goals:

• Environmental:

Emissions - Reduce tank-to-wake GHG emissions by 10 percent per revenue ton kilometer (RTK) by the end of 2030 from 2023 base year.

(1) Safety - Earn the IATA Operational Safety Audit (IOSA) certification by the end of 2026.

(2) Diversity and Inclusion - Over the years, we have attracted and cultivated top talent that has led to our ability to consistently achieve industry-leading financial metrics.

We will continue to hire, develop and support the best team members by fostering a transparent, diverse and inclusive company culture.

• Governance:

(1) Customer Engagement - Maintain a controllable completion of at least 99.5 percent annually.

(2) Procurement - Adopt a responsible sourcing policy and embed the policy into existing governance and procurement management systems by the end of 2025

To determine material topics, a materiality assessment was conducted.

This assessment benchmarked material ESG topics across our industry, global reporting frameworks and third-party rating and ranking methodologies.

We then engaged with more than 400 stakeholders including customers, employees, suppliers, shareholders and community partners.

Based on survey and interview results, we identified the following topics as material to Allegiant:

• Environmental - Emissions, Energy, Waste and Hazardous Materials

• Social - Product Quality and Safety, Accident and Safety Management, Human Rights, Benefits and Work-Life Balance, Non-Discrimination, Employee Health and Safety, Employment, Diversity, Equity and Inclusion, Employee Training and Development, Labor Management, Local Job Creation

• Governance - Business Ethics and Integrity, Anti-Corruption, Competitive Behavior, Data Security, Customer Privacy

These material topics will continue to guide the development of our annual ESG reports.

In addition, we made recent investments in several ESG areas that will enable us to build a more resilient business, drive greater efficiencies and give back to our communities.

These include the following:

Environmental :

Agreed to purchase 50 Boeing 737MAX aircraft, which are expected to burn up to 20 percent less fuel on a per passenger basis compared to certain of the older Airbus A320 Series aircraft in our fleet, with the option to purchase an additional 80 Boeing 737MAX aircraft.

Provided in-kind travel for Make-A-Wish kids and their families, including our 2000th wish kid in the beginning of 2023.

Continued offering free office space in our Las Vegas headquarters to the Make-A-Wish Southern Nevada Chapter.

Pledged $1.0 million to Boys & Girls Clubs of America as discussed under "Community Involvement" below.

Gifted over $40,000 of flight vouchers to local elementary and high school teachers in partnership with The Smith Center for the Performing Arts’ The Heart of Education Awards program.

In 2022, we began efforts to implement multiple systems – including SAP Ariba, Trax and Fuel Plus – to manage and enhance our supply chain.

All three systems are procurement platforms that will enable better tracking of our supplier spend

and demographics to help us account for the items or services we procure.

In 2023, we launched SAP Ariba and Fuel Plus for enterprise-wide use.

We expect to launch Trax in 2024.

The aviation industry accounts for roughly two percent of global greenhouse gas emissions, almost all of which is attributable to aircraft fuel.

Back in 2013, we began the process of transitioning our fleet from a mixture of MD-80 aircraft and Boeing 757 aircraft to an all-Airbus fleet with the transition concluding in November 2018.

During this period, we saw significant improvement in fuel efficiency.

During 2023, we consumed 225 million gallons of fuel averaging 83.4 ASMs per gallon of fuel, a 32 percent improvement when compared to 2012.

Our agreement with Boeing and CFM International to purchase 50 Boeing 737 MAX aircraft powered by LEAP 1-B engines, with deliveries beginning in 2024, will provide us with new aircraft and more environmentally friendly engines.

This aircraft is expected to burn up to 20 percent less fuel on a per passenger basis as compared to certain of the older Airbus A320 aircraft in our fleet.

As of December 31, 2023, the composition of our fleet included a mix of A319 and A320 aircraft with seat configurations ranging from 156 to 186 seats, some of which are fitted with fuel-efficient Sharklets.

We expect to see further fuel efficiency once the 737 MAX aircraft are added to our fleet.

Despite the significant fuel efficiencies gained over the past decade, we recognize we have a responsibility to do more, and one of our ESG goals is to reduce emissions through the end of this decade.

We have an internal Fuel Steering Committee that meets monthly to discuss various alternatives to conserve fuel.

Building on the dedicated efforts and teamwork of our pilots, dispatchers, and station personnel, we are actively advancing our fuel conservation practices across all flights, which include the following:

• Single engine taxi in and out, as time permits

• Constant descent angle approach, as permitted by air traffic

• Flaps 3 for landing, an Airbus green procedure creating less drag during the landing process, conditions permitting

• Idle thrust reverse for landing, conditions permitting

• Auxiliary power unit fuel optimization

• Route optimization

• Data collection by aircraft to identify performance deterioration and rectify where necessary

• Optimization of the amount of contingency and dispatch fuel

• Deployment of process to find optimal winds aloft while inflight

In addition to the initiatives above, we are currently assessing sustainable aviation fuels as part of our sustainability strategy for reaching our emissions intensity reduction goal by the end of 2030 and offsetting requirements under the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA).

Unlike many air carriers focused on business travel, our strategy is to provide access to affordable travel for leisure travelers who highly value their vacations and are likely to take vacations in any economic environment.

We are a low utilization air carrier focusing on leisure travel.

We seek to closely match our available capacity with demand trends in providing only nonstop service from under-served cities to leisure destinations.

For example, in 2023 during our peak demand period in July, we averaged 7.4 system block hours per aircraft per day while in September, we averaged only 4.5 system block hours per aircraft per day when leisure demand is seasonally lower.

This practice of significantly reduced flying during the off-peak periods leads to consistently high load factors, and further enhances fuel efficiency.

We offer all nonstop flights, directly from 123 cities as of February 1, 2024, providing service in many markets abandoned or under-served by larger carriers.

If not for Allegiant, many of the customers we serve would not have access to direct flights by virtue of either geography or price point.

Prior to our initiation of service on these routes, many of these passengers either traveled by car, which is significantly less fuel efficient than air travel, or traveled by car to larger airports to fly, where higher cost connecting flights were the only option.

As fuel consumption is greatest during take-off,

the ability to travel to the destination with a single take-off, as opposed to at least two take-offs on connecting flights, is more fuel efficient.

Aircraft Fuel

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Our largely variable cost structure allows us to adjust capacity accordingly based on the fuel environment.

Data Security

We continue to invest heavily in cybersecurity, cyber risk, vendor risk, and privacy initiatives.

We employ experienced staff dedicated to cybersecurity and cyber risk analysis, process, and technology.

We continue to evaluate and proactively implement new preventive and detective processes and technologies including forward looking threat intelligence and data centric security measures.

One of our current and ongoing data security initiatives is the migration of critical business applications into the cloud infrastructure, which will allow us to take advantage of analytics and automation functionality.

These improvements also provide further opportunities to increase business intelligence and flexibility, improve business continuity, and mitigate disaster scenarios.

Protecting business data and our customers’ privacy is critical to our continued operations and we intend to continue investing resources in cyber security accordingly.

For further information on our cybersecurity practices, see Item 1C - Cybersecurity.

Aircraft Maintenance

We have a Federal Aviation Administration ("FAA") approved maintenance program, which is administered by our maintenance department headquartered in Las Vegas.

Technicians employed by us have appropriate experience and hold required licenses issued by the FAA.

We provide them with comprehensive training and maintain our aircraft in accordance with FAA regulations.

The maintenance performed on our aircraft can be divided into three general categories:

line maintenance, major maintenance, and component and engine overhaul and repair.

Line maintenance is generally performed by our personnel in certain cities of our network and by contractors elsewhere.

We contract with FAA-approved outside organizations to provide major maintenance and component and engine overhaul and repair.

We have chosen not to invest in facilities or equipment to perform our own major maintenance, engine overhaul or component work.

Our management supervises all maintenance functions performed by our personnel and contractors employed by us, and by outside organizations.

As of December 31, 2024, the airline employed 5,991 full-time equivalent employees.

Full-time equivalent employees consisted of approximately 1,375 pilots, 1,900 flight attendants, 775 airport operations personnel, 825 maintenance personnel, 200 reservation agents, 50 flight dispatchers, and 875 management and other personnel.

Additionally, we employed 1,043 full-time equivalent employees at our newly opened Sunseeker Resort as of the same date.

Additionally, we employed approximately 700 full-time equivalent employees at Sunseeker Resort as of the same date.

Four groups of our employees – pilots, flight attendants, dispatchers, and maintenance technicians – are represented by labor organizations pursuant to the Railway Labor Act (“RLA”).

Those unions have negotiated separate collective bargaining agreements (“CBAs”) with us covering the rates of pay, rules, and working conditions that apply to those employees.

The CBAs covering our dispatchers and maintenance technicians do not become amendable until 2026 and 2028, respectively.

The CBAs covering our pilots and flight attendants became amendable in 2021 and 2022, respectively, and we are currently engaged in collective bargaining with the respective representatives of those employees for successor agreements.

The CBAs covering our dispatchers, maintenance technicians, and flight attendants do not become amendable until 2026, 2028, and 2029, respectively.

The CBA covering our pilots became amendable in 2021 and we are currently engaged in collective bargaining with the representatives of those employees for a successor agreement.

Under the RLA, if direct negotiations do not result in an agreement, either party may request the National Mediation Board ("NMB") to appoint a federal mediator to assist the parties with their negotiations.

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In 2023, we and the union that represents our pilots jointly requested the appointment of a mediator through the NMB.

The NMB has appointed a mediator and the parties continue to participate in mediated negotiations.

In May 2023, we reached a tentative agreement with the union representing our flight attendants, but the proposed agreement was rejected by this work group.

The parties have now resumed negotiations on the terms of a new contract.

The NMB has appointed a mediator and the parties continue to participate and make progress in mediated negotiations.

To date, we have not experienced any work interruptions or stoppages from our non-unionized or unionized employee groups.

System Implementations

Beginning in 2021, we have made significant investments to replace certain core proprietary systems with more advanced and integrated third party software solutions.

We have selected SAP as our accounting system, Trax as our Maintenance, Repair, and Overhaul (MRO) system, and Navitaire as our passenger service system.

We are transitioning to new systems in other areas as well.

SAP's accounting system is expected to simplify our financial operations, enabling real-time data access and improved financial reporting.

Trax's MRO system is expected to provide enhanced maintenance, repair, and overhaul operations, streamlining aircraft maintenance schedules and reducing associated costs.

Navitaire’ s passenger service system is expected to improve the way the airline manages customer interactions, reservations, and allows for dynamically priced ancillary products.

Navitaire is also expected to facilitate the initiation and operation of our planned joint alliance with VivaAerobus.

We successfully switched over to SAP and Navitaire in 2023, with the Trax cutover projected in 2024.

Human Capital

As part of our human capital resource objectives, we seek to recruit, retain, and develop our existing and future workforce.

We strive to build and maintain a diverse environment that people want to join, and where team members want to stay to build their careers.

We have always hired and will continue to hire based on merit.

We strive to build and maintain an environment that people want to join, and where team members want to stay to build their careers.

Our total rewards philosophies support these objectives.

Above all else, safety is our number one core value, along with achievement, flexibility, innovation, bias for action, teamwork, transparency and accountability, and outcome-based values that define our human capital mission.

We have long supported Diversity, Equity and Inclusion and operate a Diversity & Inclusivity Council made up of company leadership, and facilitate more than ten company-wide network groups to inspire a more inclusive culture while giving a dedicated focus to our recruiting processes to continue driving diverse hiring.

Above all else, safety is our number one core value, along with collaboration, focus, excellence, and sunshine that define our human capital mission.

We are committed to create a culture and environment where team members are safe and can thrive.

This is accomplished through committees of leadership, including our Employee Experience Leadership Team, who are committed to making sure that policies and procedures are evaluated from all groups.

Leadership also supports the efforts of Team Members through our Fun Squad, Network Groups, Interest Groups and more.

Our total rewards philosophy is based around building a culture of high performance.

We utilize competitive base salaries, discretionary performance-based bonuses, spot rewards, profit sharing, and equity as attraction and retention tools for our team members.

As of December 31, 2023, the airline had approximately 6,060 team members (including both full-time and part-time employees), of whom approximately 73 percent are in front line positions such as flight crew, mechanics or airport personnel.

Additionally, we had over 1,100 full-time and part-time newly added Sunseeker Resort employees as of same date.

We utilize competitive base salaries, performance-based bonuses, spot rewards, profit sharing, and equity as attraction and retention tools for our team members.

As of December 31, 2024, the airline had more than 6,400 team members (including both full-time and part-time employees), of whom approximately 83 percent are in front line positions such as flight crew, mechanics or airport personnel.

Additionally, we had over 750 full-time and part-time Sunseeker Resort employees as of same date.

The safety and well-being of our team members is a top priority, and we believe each and every team member plays an essential role in creating a safe and healthy workplace.

Our health and safety policies and practices are intended to protect not only our team members, but also our customers in all things we do.

Our human capital focus has been externally recognized through Allegiant’s placement on Newsweek's America's Greatest Workplaces for Diversity 2024 and Most Responsible Companies 2024.

In addition, we received recognition in 2023 from VETS Indexes as a 4-Star Employer for Military hiring, Yello's Top 100 Internship Programs, and honored among Newsweek's America's Greatest Workplaces, Greatest Workplaces for Diversity, and Greatest Workplaces for Women, all for 2023.

We were also recognized in 2023 as one of Forbes Best Mid-Size Employers and Fortune's Most Innovative Companies.

Our human capital focus has been externally recognized through Allegiant’s placement in 2024 on Newsweek's America's Greatest Workplaces for Diversity, Best of the Best, and Most Responsible Companies.

In 2024, Allegiant also received honors from U.S.

News Best Companies to Work For, VETS Indexes, and Time's Best Mid-Size Companies.

Data Security

We continue to invest heavily in cybersecurity, cyber risk, vendor risk, and privacy initiatives.

We employ experienced staff dedicated to cybersecurity and cyber risk analysis, process, and technology.

We continue to evaluate and proactively implement new preventive and detective processes and technologies including forward looking threat intelligence and data centric security measures.

These improvements also provide further opportunities to increase business intelligence and flexibility, improve business continuity, and mitigate disaster scenarios.

Protecting business data and our customers’ privacy is critical to our continued operations and we intend to continue investing resources in cyber security accordingly.

For further information on our cybersecurity practices, see Item 1C - Cybersecurity.

Artificial Intelligence

We have established an Artificial Intelligence (“AI”) Council to explore and implement AI-driven solutions across various business operations.

This Council, composed of cross-functional leaders and experts, is focused on automating routine processes, enhancing data analytics capabilities, and improving decision-making frameworks.

The AI Council is also responsible for addressing potential risks associated with AI implementation, including data privacy, security, and ethical considerations.

System Implementations

Beginning in 2021, we have made significant investments to replace certain core proprietary systems with more advanced and integrated third party software solutions.

We have selected SAP as our accounting system, Trax as our maintenance, repair, and overhaul ("MRO") and materials and inventory management system, and Navitaire as our passenger service system.

We are transitioning to new systems in other areas as well.

SAP's accounting system is expected to simplify our financial operations, enabling real-time data access and improved financial reporting.

Trax's MRO system is expected to provide enhanced maintenance, repair, and overhaul operations, streamlining aircraft maintenance schedules and reducing associated costs.

Navitaire’ s reservations system is expected to improve the way the airline manages customer interactions, reservations, and allows for dynamically priced ancillary products.

Navitaire is also expected to facilitate the initiation and operation of our planned joint alliance with VivaAerobus.

We successfully switched over to SAP and Navitaire in 2023 and Trax in 2024.

Community Involvement

We have worked with the Make-A-Wish® Foundation since 2012 by flying "wish kids" and their families to their desired destinations, at no cost, and donating a portion of proceeds from our in-flight Wingz Kids Snack Pack to the organization.

To kick off 2023, we celebrated a special milestone welcoming our 2000th wish kid on board an Allegiant flight.

To date, we have flown more than 2,000 wish kids - along with their families - to their destinations.

This in-kind flight program provides Make-A-Wish with a valuable service at no cost to the organization or the wish families.

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We are considered a Wish Champion by Make-A-Wish America, recognizing more than $1 million in annual contributions.

In May 2023, we pledged $1 million to Boys & Girls Clubs of America to develop and launch a new program seeking to inspire children to choose future careers in aviation.

The gift also includes a fundraising campaign to match donations made by individuals who make a new monthly pledge or increase their current amount.

The program launched with a tour of our West Coast training center and allowed Club youth to fly an Airbus simulator, learn about the features of an aircraft and ask pilots about their careers.

Allegiant is the only airline to feature a special Make-A-Wish livery on one of our A320 Airbus aircraft, a symbol of our dedication to making air travel accessible to all.

In 2024, Allegiant awarded a 17-year old girl from Florida a Careers in Aviation scholarship in partnership with the Boys & Girls Club of America.

She received $34,000 to pay for tuition and expenses as she pursues her bachelor's degree at Embry-Riddle Aeronautical University.

Since 2023, we have donated $1 million to Boys & Girls Club of America to fund programs designed to inspire children to choose future careers in aviation.

We have also been a national partner with The Arc, a nonprofit organization dedicated to advocacy on behalf of people with intellectual and developmental disabilities.

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In this effort, we have provided no-cost supply flights and volunteer transport to support Red Cross hurricane recovery efforts in Florida and Puerto Rico in recent years.

In the wake of Hurricane Ian in 2022, we made a $100,000 donation to the organization to help restore critical resources in the community and we sponsored a month-long nationwide blood drive to further support relief efforts.

In the wake of Hurricane Ian in 2022, we made a $100,000 donation to the

organization to help restore critical resources in the community and we sponsored a month-long nationwide blood drive to further support relief efforts.

In the wake of hurricanes Helene and Milton in 2024, Allegiant partnered with Airlink Flight, a nonprofit that transports relief workers and emergency supplies for reputable non-governmental organizations (NGOs) responding to rapid-onset disasters and other humanitarian crises around the globe.

Periodically, we provide additional support in our home community of Las Vegas, donating surplus in-flight food and beverage items such as juices, sodas and snacks to a local community food bank for distribution to families in need.

We also provide $40,000 worth of flight vouchers on an annual basis to hundreds of local elementary and high school teachers as part of The Smith Center for the Performing Arts’ Heart of Education Awards program.

Aircraft Maintenance

We have a Federal Aviation Administration ("FAA") approved maintenance program, which is administered by our maintenance department headquartered in Las Vegas.

Technicians employed by us have appropriate experience and hold required licenses

issued by the FAA.

We provide them with comprehensive training and maintain our aircraft in accordance with FAA regulations.

The maintenance performed on our aircraft can be divided into three general categories:

line maintenance, major maintenance, and component and engine overhaul and repair.

Line maintenance is generally performed by our personnel in certain cities of our network and by contractors elsewhere.

We contract with FAA-approved outside organizations to provide major maintenance and component and engine overhaul and repair.

We have chosen not to invest in facilities or equipment to perform our own major maintenance, engine overhaul or component work.

Our management supervises all maintenance functions performed by our personnel and contractors employed by us, and by outside organizations.

VivaAerobus Alliance

In December 2021, we announced plans for a fully-integrated commercial alliance agreement with VivaAerobus, designed to expand options for nonstop leisure air travel between our markets in the United States and Mexico.

We and VivaAerobus have submitted a joint application to the DOT requesting approval of and antitrust immunity for the alliance.

We and VivaAerobus continue to await U.S.

government approval of our joint application to the DOT requesting approval of, and antitrust immunity for, the alliance.

We are hopeful that the change in the Presidential administration will bring a favorable resolution to this historically long process.

The DOT process progressed substantially under the prior administration, but review was suspended in 2023 pending the outcome of diplomatic engagement on broader treaty issues.

We believe this alliance is consistent with the DOT's goal of providing maximum benefits to the public, as the alliance is expected to increase competition, reduce transborder fares and provide increased nonstop service for our consumers traveling between the U.S.

The alliance is anticipated to add new transborder routes and nonstop competition where currently only connecting service is available.

More than 250 new potential nonstop route opportunities have been identified as part of the DOT application, though specific routes targeted for service wilI be announced at a later date, following the application's approval.

More than 250 new potential nonstop route opportunities have been identified as part of the DOT application, though specific routes targeted for service will be announced at a later date, following the application's approval.

We and VivaAerobus expect to offer flights under the alliance after governmental approval of the applications.

The DOT process has progressed substantially, but review is currently suspended pending the outcome of diplomatic engagement on broader treaty issues.

In addition, we have made an investment of $50.0 million in VivaAerobus.

Non-Airline Initiatives

Sunseeker Resort

Sunseeker Resort at Charlotte Harbor opened in December 2023, culminating a multi-year vision of the company.

In 2017, we purchased more than 20 acres of land to build the Resort and announced our initial plans for the Resort.

We then hired experienced industry executives in 2018 and 2019 to plan for the operation of the Resort.

Construction began in March 2019.

Construction was delayed as a result of the pandemic, supply chain difficulties and then Hurricane Ian in 2022 and Hurricane Idalia in 2023.

Damage from the storms and other insured events exceeded $78 million and a portion of the insurance claims remains outstanding.

Construction was substantially completed in December 2023, and the Resort opened.

Certain assets did not open to the public from the beginning as two restaurants, one of the suite towers, the rooftop pool and certain retail establishments did not open until first quarter 2024.

The Resort consists of more than 500 hotel rooms, 189 one-, two- and three-bedroom suites with full kitchens and washer-dryers, 20 restaurants, including seven stand-alone restaurants, a food hall with 11 food and beverage concepts and two other poolside options.

Sunseeker Resort at Charlotte Harbor ("Sunseeker" or the "Resort") opened in December 2023.

The Resort consists of more than 500 hotel rooms, 189 one-, two- and three-bedroom suites with full kitchens and washer-dryers, 18 restaurants, including five stand-alone restaurants, a food hall with 11 food and beverage concepts and two other poolside options.

The two-bedroom suites can be separately locked allowing for up to 785 keys on the property.

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Accompanying the ballrooms are two executive boardrooms, 12 meeting rooms, and an ideation suite with separate breakout rooms.

We are actively selling to groups.

During the 2024 period ended February 15, 2024, we have hosted 16 groups.

During the year ended December 31, 2024, we hosted approximately 250 groups with more than 42,000 attendees.

The Resort also offers a state-of-the-art 7,100-square-foot fitness center and a full-service spa and salon as well as two pools including a 21,000-square-foot rooftop facility and a 117,000-square-foot ground-level experience.

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We intend to keep ESG embedded within day-to-day operations and the guest experience.

As of February 1, 2024, the Resort and Aileron Golf Course employ more than 1,200 employees, making it one of the largest employers in Southwest Florida.

Other travel and leisure initiatives

Consistent with our travel and leisure company focus, we may pursue other travel and leisure initiatives from time to time in the future.

We have engaged experienced hospitality advisors to identify areas for improvement to optimize the value of this asset and, in addition, there is currently an ongoing process to explore strategic alternatives for the Resort, including a potential sale or stake sale.

As of February 1, 2025, the Resort and Aileron Golf Course employ more than 750 employees.

We maintain insurance policies we believe are of types customary in the airline industry and as required by the DOT, and are in amounts we believe to be adequate to protect us against material loss.

The policies principally provide coverage for public liability, war-risk, passenger liability, baggage and cargo liability, property damage, including coverages for loss or damage to our flight equipment, directors and officers insurance and workers’ compensation.

We also maintain what we believe to be customary insurance on Sunseeker Resort and as required by the terms of our construction loan.

There is no assurance, however, that the amount of insurance we carry will be sufficient to protect us from material loss in all cases.

We also maintain what we believe to be customary insurance on Sunseeker Resort.

There is no assurance, however, that the amount of insurance we carry will be sufficient to protect us from material loss in all cases as our insurance provides for customary deductibles, co-insurance, caps and exclusions.

Available commercial insurance in the future could be more expensive, could have material differences in coverage than is currently provided, and may not be adequate to protect us from risk of loss.

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The dispute remains unresolved and there is no assurance when or whether the DOT will ultimately approve the agreement and grant antitrust immunity.

Although the new Presidential administration has indicated there is a stated objective at the DOT to reduce areas where government friction has stymied private sector partnership and growth, there can be no assurance that other factors will not continue to delay approval of our application.

We hold DOT certificates of public convenience and necessity authorizing us to engage in scheduled air transportation of passengers, property and mail within the United States, its territories and possessions, and between the United States and all countries that maintain a liberal aviation trade relationship with the United States (known as “open skies” countries).

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The FAA requires each commercial airline to obtain and hold an FAA air carrier certificate.

This certificate, in combination with operation specifications issued to the airline by the FAA, authorizes the airline to operate at specific airports using aircraft certificated by the FAA.

This certificate, in combination with operation specifications issued to the airline by the FAA, authorizes the airline to operate scheduled service at specific airports using aircraft certificated by the FAA.

We have and maintain in effect FAA certificates of airworthiness for all our aircraft, and we hold the necessary FAA authority to fly to all the cities we currently serve.

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certificated carriers, our provision of scheduled service to certain destinations may require specific governmental authorization.

The FAA has the authority to investigate all matters within its purview, to modify, suspend or revoke our authority to provide air transportation, to approve or disapprove the addition of aircraft to our operation specifications, and to modify, suspend or revoke FAA licenses issued to individual personnel, for failure to comply with FAA regulations.

The FAA can assess civil penalties for such failures and institute proceedings for the collection of monetary fines after notice and hearing.

The FAA has the authority to investigate all matters within its purview, to modify, suspend or revoke our authority to provide air transportation, to approve or disapprove the addition of scheduled service to new cities and aircraft to our operation specifications, and to modify, suspend or revoke FAA licenses issued to individual personnel, for failure to comply with FAA regulations.

The FAA can negotiate the assessment of civil penalties with us for such failures and if we are unable to come to an agreement, institute proceedings to assess civil penalties unilaterally for such failures after notice and hearing.

The FAA also has authority to seek criminal sanctions.

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We have satisfactorily responded to all findings on all Certificate Holder Evaluation Process and other inspections conducted.

We believe DOT Secretary Duffy’s recent statement that he plans to involve the Department of Government Efficiency (DOGE) team to review and overhaul technological systems and procedures at the FAA is a positive sign that critical aspects of the aging National Air System, including AWOS/ASOS weather observing systems, could soon receive modernization, replacement or repair.

Within the United States, civil aviation security functions, including review and approval of the content and implementation of air carriers’ security programs, passenger and baggage screening, cargo security measures, airport security, assessment and distribution of intelligence, threat response, and security research and development are the responsibility of the Transportation Security Administration (“TSA”) of the Department of Homeland Security.

We operate in accordance with a TSA-approved security program.

The TSA has enforcement powers similar to the DOT’s and FAA’s described above.

It also has the authority to issue regulations, including in cases of emergency, the authority to do so without advance notice, including issuance of a grounding order as occurred on September 11, 2001.

It also has the authority to issue regulations and security directives, including in cases of emergency, without advance notice, which may encompass actions up to and including issuance of a grounding order as occurred on September 11, 2001.

Aviation Taxes and Fees .

The authority of the federal government to collect most types of aviation taxes, which are used, in part, to finance the nation’s airport and air traffic control systems, and the authority of the FAA to expend those funds must be periodically reauthorized by the U.S.

A five-year reauthorization extending certain commercial aviation taxes (known generally as Federal Excise Taxes or "FET") expired September 30, 2023;

a short-term extension is in effect through March 31, 2024.

Legislation to reauthorize the FAA through September 30, 2028 is pending in the U.S.

A five-year reauthorization extending certain commercial aviation taxes (known generally as Federal Excise Taxes or "FET") was approved by Congress in May 2024, reauthorizing the FAA and extending the expiration of the FET to September 30, 2028.

All carriers are required to collect these taxes from passengers and pass them through to the federal government.

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These fees do not need to be reauthorized, although their amounts may be revised periodically.

In 2024 or thereafter, Congress may consider legislation that could increase the amount of FET and/or one or more of the other federally imposed or approved fees identified above.

At any time, Congress may consider legislation that could increase the amount of FET and/or one or more of the other federally imposed or approved fees identified above.

The CBP fee is inflation adjusted every October 1, and the APHIS fees are set to increase each of the next three years on October 1.

All of the aviation fees also may be increased by their implementing federal agency via a rulemaking.

Increasing the overall price charged to passengers could lessen demand for air travel.

Additionally, federal funding to airports and/or airport bond financing could be affected through legislation, which could result in higher fees, rates, and charges at many of the airports we serve.

Additionally, federal funding to airports and/or airport bond financing could be affected through additional legislation, which could result in higher fees, rates, and charges at many of the airports we serve.

Environmental.

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Similarly, in December 2022, the EPA adopted particulate matter emission standards and test procedures for newly-designed aircraft, with immediate effect, and for in-production aircraft, effective 2028.

In February 2024, the FAA adopted regulations implementing these EPA requirements.

In February 2024, the FAA adopted regulations setting fuel efficiency requirements for certification of certain airplanes implementing these EPA requirements.

These new EPA and FAA standards and procedures harmonize with International Civil Aviation Organization ("ICAO") requirements.

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While participation in the early and pilot stages is optional, the second phase mandates involvement from certain countries, including the U.S.

However, U.S.

legislation mandating participation in CORSIA is not yet in effect and is pending.

We anticipate that in 2024 and thereafter, legislative and regulatory concern with the environmental impacts of the air transportation industry will increase, and that the longer-term effects on our fleet and operating costs may be substantial.

The current Presidential administration swiftly withdrew from the Paris Climate Accord, raising the prospect that U.S.

participation in other multinational climate agreements may be similarly impacted.

At the current time, it appears unlikely the current Presidential administration and U.S.

Congress will continue the prior legislative and regulatory concern of the previous administration regarding the environmental impacts of the air transportation industry.

However, these concerns may again increase at some point in the future, in which case, the longer term effects on our fleet and operating costs may be substantial.

According to a September 2021 White House announcement, civil aviation accounts for 11 percent of emissions by the U.S.

transportation sector as a whole.

The FAA has announced a U.S.

The FAA announced a U.S.

aviation sector goal of net-zero GHG emissions by 2050, consistent with the broader federal objective of achieving net-zero GHG emissions economy-wide by 2050.

We cannot predict whether these or similar initiatives will lead to legislation that will pass the Congress or, if enacted into law, how it ultimately would apply to our operations or the airline industry.

Federal law recognizes the right of airport operators with special noise problems to implement local noise abatement procedures so long as those procedures do not interfere unreasonably with interstate and foreign commerce and the national air transportation system.

These or similar initiatives may also be modified by the current Presidential administration.

Federal law recognizes the right of airport operators with special noise concerns to implement local noise abatement procedures so long as those procedures do not interfere unreasonably with interstate and foreign commerce and the national air transportation system.

These restrictions can include limiting nighttime operations, directing specific aircraft operational procedures during takeoff and initial climb, and limiting the overall number of flights at an airport.

Few of the airports we serve currently impose such restrictions on the number of flights or hours of operation that have a meaningful impact on our operations.

Few of the airports we serve

currently impose such restrictions on the number of flights or hours of operation that have a meaningful impact on our operations.

It is possible one or more such airports or others may impose additional or future restrictions with or without advance notice, which may impact our operations.

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During a period of past fuel scarcity, air carrier access to jet fuel was subject to allocation regulations promulgated by the Department of Energy.

Changes to the federal excise tax and other government fees imposed on air transportation have been proposed and implemented from time to time and may result in an increased tax burden for airlines and their passengers.

Changes to the federal excise tax and other government fees imposed on air transportation have been proposed and implemented from time to time and may result in an increased or reduced tax burden for airlines and their passengers.

We are also subject to state and local laws, regulations, and ordinances at locations where we operate and to the rules and regulations of various local authorities that operate the airports we serve.

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Our proposed U.S.-Mexico alliance with Viva, described above, received approval by Mexico’s Federal Economic Competition Commission (COFECE) in October 2022;

however, that approval will require renewal (which is not assured) in view of the suspension of DOT processing described above.

and subsequent renewal in September 2024 while the U.S.

DOT has continued their suspension of processing described above.

International flights are also subject to U.S.

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Congress, the DOT, the FAA, the TSA, and other governmental agencies have under consideration, and in the future may consider and adopt, new laws, regulations, interpretations and policies regarding a wide variety of matters that could affect, directly or indirectly, our operations, ownership, and profitability.

We cannot predict what other matters might be considered in the future by the FAA, the DOT, the TSA, other agencies, or Congress, nor can we judge what impact, if any, the implementation of any of these proposals or changes might have on our business.

We cannot predict what other matters might be considered in the future by the FAA, the DOT, the TSA, other agencies, or Congress or the impact of the current Presidential administration may have on existing initiatives, nor can we judge what impact, if any, the implementation of any of these proposals or changes might have on our business.

Civil Reserve Air Fleet .

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As a result of our CRAF participation, we are eligible to bid on and be awarded peacetime airlift contracts with the military on a preferential basis.

Sustainability

We believe that solidifying our commitment to sustainability efforts is a natural integration into our long-term corporate strategy and will enable us to better serve our stakeholders.

We've developed a comprehensive sustainability program which focuses on:

• Identify and prioritize relevant topics through a materiality assessment.

These topics are included in our sustainability reports.

• Publish sustainability reports referencing the Global Reporting Initiative (GRI).

• Provide ongoing carbon emissions reporting of Scope 1, 2 and 3 greenhouse gas (GHG) emissions.

• Establish Sustainability targets and environmental target achievement plans, which we published in our 2022 sustainability report.

In 2024, we issued our third annual sustainability report.

This comprehensive report outlines our disclosures pertaining to material topics identified by key stakeholders and establishes the following Sustainability Goals:

• Environmental:

Emissions - Reduce tank-to-wake GHG emissions by 10 percent per revenue ton kilometer (RTK) by the end of 2030 from 2023 base year.

(1) Safety - Earn the IATA Operational Safety Audit (IOSA) certification by the end of 2026.

(2) Talent recruitment - Over the years, we have attracted and cultivated top talent that has led to our ability to consistently achieve industry-leading results.

We will continue to hire, develop and support the best team.

• Governance:

(1) Customer Engagement - Maintain a controllable completion of at least 99.5 percent annually.

(2) Procurement - Adopt a responsible sourcing policy and embed the policy into existing governance and procurement management systems by the end of 2025

To determine material topics, a materiality assessment was conducted.

This assessment benchmarked material topics across our industry, global reporting frameworks and third-party rating and ranking methodologies.

We then engaged with more than 400 stakeholders including customers, employees, suppliers, shareholders and community partners.

Based on survey and interview results, we identified the following topics as material to Allegiant:

• Environmental - Emissions, Energy, Waste and Hazardous Materials

• Social - Product Quality and Safety, Accident and Safety Management, Human Rights, Benefits and Work-Life Balance, Non-Discrimination, Employee Health and Safety, Employment, Employee Training and Development, Labor Management, Local Job Creation

• Governance - Business Ethics and Integrity, Anti-Corruption, Competitive Behavior, Data Security, Customer Privacy

These material topics will continue to guide the development of our annual sustainability reports.

The aviation industry accounts for roughly two percent of global greenhouse gas emissions, almost all of which is attributable to aircraft fuel.

Back in 2013, we began the process of transitioning our fleet from a mixture of MD-80 aircraft and Boeing 757 aircraft to an all-Airbus fleet with the transition concluding in November 2018.

During this period, we saw significant improvement in fuel efficiency.

During 2024, we consumed 227 million gallons of fuel averaging 83.5 ASMs per gallon of fuel, a 32.5 percent improvement when compared to 2012.

Our agreement with Boeing and CFM International to purchase 50 Boeing 737 MAX aircraft powered by LEAP 1-B engines, with deliveries expected through 2027, will provide us with new aircraft and more environmentally friendly engines.

This aircraft is expected to burn up to 20 percent less fuel on a per passenger basis as compared to certain of the older Airbus A320 aircraft in our fleet.

As of December 31, 2024, the composition of our fleet included a mix of A319 and A320 aircraft with seat configurations ranging from 156 to 186 seats, some of which are fitted with fuel-efficient Sharklets.

We also received delivery of our first four 737 MAX aircraft in late 2024 and have begun to see improved fuel efficiency on those aircraft.

Despite the significant fuel efficiencies gained over the past decade, we recognize we have a responsibility to do more, and one of our sustainability goals is to reduce our emissions intensity through the end of this decade.

We have an internal Fuel Steering Committee that meets monthly to discuss various alternatives to conserve fuel.

• Single engine taxi in and out, as time permits

• Constant descent angle approach, as permitted by air traffic

• Flaps 3 for landing, an Airbus green procedure creating less drag during the landing process, conditions permitting

• Idle thrust reverse for landing, conditions permitting

• Auxiliary power unit fuel optimization

• Route optimization

• Data collection by aircraft to identify performance deterioration and rectify where necessary

• Optimization of the amount of contingency and dispatch fuel

• Deployment of process to find optimal winds aloft while inflight

We focus on leisure travel and seek to closely match our available capacity with demand trends in providing only nonstop service from under-served cities to leisure destinations.

For example, in 2024 during our peak demand period in June, we averaged 7.8 system block hours per aircraft per day while in September, we averaged only 4.5 system block hours per aircraft per day when leisure demand is seasonally lower.

This practice of significantly reduced flying during the off-peak periods leads to consistently high load factors, and further enhances fuel efficiency.

We offer all nonstop flights, directly from 122 cities as of February 1, 2025, providing service in many markets abandoned or under-served by larger carriers.

If not for Allegiant, many of the customers we serve would not have access to direct flights by virtue of either geography or price point.

As fuel consumption is greatest during take-off, the ability to travel to the destination with a single take-off, as opposed to at least two take-offs on connecting flights, is more fuel efficient.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business