What changed in this filing

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Item 1. Financial Statements

2026-04-24 compared with 2025-10-31 · 158 added, 248 removed, 399 unchanged (50% of the section changed)

4 unchanged sentences

(Dollars in thousands)

September 30,

CURRENT ASSETS:

24 unchanged sentences

LIABILITIES AND STOCKHOLDERS’ EQUITY

September 30,

CURRENT LIABILITIES:

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Common stock, no par value, 120,000,000 shares authorized;

84,270,723 and 83,638,680 shares issued as of September 30, 2025, and December 31, 2024, respectively

85,373,814 and 84,270,723 shares issued as of March 31, 2026 and December 31, 2025, respectively

Retained earnings

Treasury stock, at cost, 44,130,979 and 43,310,324 shares as of September 30, 2025, and December 31, 2024, respectively

Treasury stock, at cost, 45,612,892 and 44,399,241 shares as of March 31, 2026 and December 31, 2025, respectively

( 1,195,810 )

Accumulated other comprehensive income

( 1,074,822 )

Accumulated other comprehensive income (loss)

Total stockholders’ equity

6 unchanged sentences

Three months ended

Nine months ended

September 30,

OPERATING REVENUES:

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Interest expense

Other income (expense), net

Other expense, net

Total other expense, net

5 unchanged sentences

COMPREHENSIVE INCOME:

Net unrealized appreciation on marketable securities, net of taxes

Net unrealized depreciation on marketable securities, net of taxes

TOTAL COMPREHENSIVE INCOME

6 unchanged sentences

Comprehensive

Income (Loss)

Balance at December 31, 2025

Vested employee stock awards

( 1,074,822 )

Stock issued under the long-term incentive plan

Employee income tax paid on vested equity awards

5 unchanged sentences

( 1,195,810 )

Stock grants to Company directors

Stock based compensation expense

Treasury stock purchases

Net unrealized depreciation on marketable securities, net of tax of $ 26

Balance at June 30, 2025

( 1,020,870 )

Sale of common stock under employee stock purchase plan

Stock based compensation expense

Treasury stock purchases

Net unrealized appreciation on marketable securities, net of tax of $ 105

Balance at September 30, 2025

( 1,047,640 )

See accompanying notes to condensed consolidated financial statements.

SKYWEST, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands)

Treasury Stock

Comprehensive

Income (Loss)

Balance at December 31, 2024

Vested employee stock awards

Stock issued under the long-term incentive plan

Employee income tax paid on vested equity awards

1 unchanged sentence

Stock-based compensation expense

Treasury stock purchases

Treasury stock purchases and related excise tax

Net unrealized depreciation on marketable securities, net of tax of $ 23

Balance at March 31, 2025

Stock grants to Company directors

Stock based compensation expense

Treasury stock purchases

Net unrealized depreciation on marketable securities, net of tax of $ 212

Balance at June 30, 2024

Sale of common stock under employee stock purchase plan

Issuance of common stock upon warrant exercise, net

Stock based compensation expense

Treasury stock purchases

Net unrealized appreciation on marketable securities, net of tax of $ 283

Balance at September 30, 2024

( 1,003,574 )

See accompanying notes to condensed consolidated financial statements.

3 unchanged sentences

(In Thousands)

Nine months ended

September 30,

Three months ended

NET CASH PROVIDED BY OPERATING ACTIVITIES

1 unchanged sentence

Purchases of marketable securities

( 1,212,208 )

Sales of marketable securities

2 unchanged sentences

Buildings and ground equipment

Proceeds from the sale of property and equipment

Deposits on aircraft

Decrease (increase) in other assets, net

Proceeds from the sale of property and equipment

Decrease in other assets, net

NET CASH USED IN INVESTING ACTIVITIES

5 unchanged sentences

Employee income tax paid on vested equity awards

Purchase of treasury stock and excise tax

Purchase of treasury stock and related excise tax

NET CASH USED IN FINANCING ACTIVITIES

Increase (decrease) in cash and cash equivalents

Decrease in cash and cash equivalents

Cash and cash equivalents at beginning of period

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These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

The results of operations for the three and nine months ended September 30, 2025, are not necessarily indicative of the results that may be expected for the year ending December 31, 2025.

The results of operations for the three months ended March 31, 2026, are not necessarily indicative of the results that may be expected for the year ending December 31, 2026.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

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Recent Accounting Pronouncements

In December 2023, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update No.

2023-09, “Income Taxes (ASC Topic 740) – Improvements to Income Tax Disclosures”, which enhances the transparency, effectiveness and comparability of income tax disclosures by requiring consistent categories and greater disaggregation of information related to income tax rate reconciliations and the jurisdictions in which income taxes are paid.

The guidance is effective for annual periods beginning after December 15, 2024, with early adoption permitted.

The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures.

In March 2024, the FASB issued ASU No.

2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (ASC Subtopic 220-40) – Disaggregation of Income Statement Expenses”, which enhances the transparency and comparability of financial statements by requiring companies to disclose more granular information about expense components.

In March 2024, the Financial Accounting Standards Board issued Accounting Standards Update No.

2024-03, “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Accounting Standards Codification (“ASC”) Subtopic 220-40) – Disaggregation of Income Statement Expenses”, which enhances the transparency and comparability of financial statements by requiring companies to disclose more granular information about expense components.

The guidance is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted.

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(“American”) and Alaska Airlines, Inc.

(“Alaska”) (each, a “major airline partner”), the major airline partner generally pays the Company a fixed-fee for each departure, flight hour (measured from takeoff to landing, excluding taxi time) or block hour (measured from takeoff to landing, including taxi time) incurred, and an amount per aircraft in service each month, with additional incentives based on flight completion, on-time performance or

other performance metrics.

The major airline partner also directly pays for or reimburses the Company for certain direct expenses incurred under the capacity purchase agreement, such as fuel, airport landing fees and airport rents.

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The transaction price for the capacity purchase agreements is determined from the fixed-fee consideration, incentive consideration and directly reimbursed expenses earned as flights are completed over the agreement term.

For the nine months ended September 30, 2025 and 2024, capacity purchase agreements represented approximately 84.8 % and 86.8 % of the Company’s flying agreements revenue, respectively.

Under the Company’s “prorate” agreements, the major airline partner and the Company negotiate a passenger fare proration formula, pursuant to which the Company receives a percentage of the ticket revenues for those passengers traveling for one portion of their trip on a Company airline and the other portion of their trip on the major airline partner.

For the three months ended March 31, 2026 and 2025, capacity

purchase agreements represented approximately 82.8 % and 85.7 % of the Company’s flying agreements revenue, respectively.

Under the Company’s “prorate” agreements, the major airline partner and the Company negotiate a passenger fare proration formula, pursuant to which the Company receives a percentage of the ticket revenues for those passengers traveling for one portion of their trip on a Company aircraft and the other portion of their trip on the major airline partner.

Under the Company’s prorate agreements, the performance obligation is met and revenue is recognized when each flight is completed based upon the portion of the prorate passenger fare the Company determines that it will receive for each completed flight.

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The performance obligation is met and revenue is recognized upon completion of the flight.

For the nine months ended September 30, 2025 and 2024, prorate agreements and SWC revenue represented approximately 15.2 % and 13.2 % of the Company’s flying agreements revenue, respectively.

The following table represents the Company’s flying agreements revenue by type for the three and nine months ended September 30, 2025 and 2024 (in thousands):

For the three months ended September 30,

For the nine months ended September 30,

For the three months ended March 31, 2026 and 2025, prorate agreements and SWC revenue represented approximately 17.2 % and 14.3 % of the Company’s flying agreements revenue, respectively.

The following table disaggregates the Company’s flying agreements revenue by type for the three months ended March 31, 2026 and 2025 (in thousands):

For the three months ended March 31,

Capacity purchase agreements flight operations revenue (non-lease component)

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The Company refers to cash received under its capacity purchase agreements prior to recognizing revenue as “deferred revenue,” and the Company refers to revenue recognized prior to billing its major airline partners under its capacity purchase agreements as “unbilled revenue” for each reporting period.

During the nine months ended September 30, 2025, the Company recognized $ 28.8 million of previously deferred revenue associated with the non-lease fixed monthly payments under certain agreements and increased unbilled revenue by $ 9.5 million under certain other agreements,

compared to recognizing $ 24.5 million of previously deferred revenue and decreasing unbilled revenue by $ 0.9 million during the nine months ended September 30, 2024.

A portion of the Company’s compensation under its capacity purchase agreements is designed to reimburse the Company for certain aircraft ownership costs.

The consideration for aircraft ownership costs varies by agreement but is intended to cover either the Company’s aircraft principal and interest debt service costs, its aircraft depreciation and interest expense or its aircraft lease expense costs while the aircraft is under contract.

The consideration for aircraft ownership costs varies by agreement but is intended to compensate the Company for providing its aircraft under the contract.

The consideration received for the use of the aircraft under the Company’s capacity purchase agreements is accounted for as lease revenue, inasmuch as the agreements identify the “right of use” of a specific type and number of aircraft over a stated period of time.

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The Company recognizes fixed monthly lease payments as lease revenue using the straight-line basis over the capacity purchase agreement term and variable lease payments in the period when the block hours are completed.

The Company recognized $ 10.5 million of previously deferred lease revenue and increased unbilled lease revenue by $ 4.2 million during the nine months ended September 30, 2025, whereas the Company recognized $ 1.5 million of deferred lease revenue during the nine months ended September 30, 2024, under the straight-line basis.

The Company has not separately stated aircraft rental income and aircraft rental expense in the consolidated statement of comprehensive income because the use of the aircraft is not a separate activity of the total service provided under the capacity purchase agreements.

The Company’s total deferred revenue balance as of September 30, 2025 was $ 297.1 million, including $ 133.8 million in other current liabilities and $ 163.3 million in other long-term liabilities.

The Company’s unbilled revenue balance was $ 27.7 million as of September 30, 2025, including $ 1.1 million in other current assets and $ 26.6 million in other long-term assets.

The Company’s total deferred revenue balance was $ 337.5 million as of December 31, 2024, including $ 54.8 million in other current liabilities and $ 282.7 million in other long-term liabilities.

The Company’s unbilled revenue balance was $ 15.1 million as of December 31, 2024, including $ 1.1 million in other current assets and $ 14.0 million in other long-term assets.

The Company has not separately stated aircraft rental income and aircraft rental expense in the consolidated statement of

comprehensive income because the use of the aircraft is not a separate activity of the total service provided under the capacity purchase agreements.

The following table summarizes the amount of deferred revenue, recognition of previously deferred revenue and change in unbilled revenue for revenue recognized that is in excess of (or less than) the fixed monthly non-lease and lease payments received under the Company’s capacity purchase agreements for the three months ended March 31, 2026 and 2025 (in thousands):

For the three months ended March 31,

Non-lease fixed monthly payments:

Revenue deferred on fixed monthly payments received

Revenue recognized that was deferred in a prior period

Increase (decrease) in unbilled revenue

Total non-lease revenue recognized in excess of fixed monthly payments received during the period

Lease fixed monthly payments:

Revenue deferred on fixed monthly payments received

Revenue recognized that was deferred in a prior period

Increase in unbilled revenue

Total lease revenue recognized in excess of fixed monthly payments received during the period

Total revenue recognized in excess of fixed monthly payments received during the period

The Company's unbilled revenue and deferred revenue balances were reflected in the following balance sheet line items at March 31, 2026 and December 31, 2025 (in thousands):

Unbilled revenue - other current assets

Unbilled revenue - other long-term assets

Total unbilled revenue

Deferred revenue - other current liabilities

Deferred revenue - other long-term liabilities

Total deferred revenue

Net deferred revenue balance

The Company’s capacity purchase and prorate agreements include weekly provisional cash payments from the respective major airline partner based on a projected level of flying each month.

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At the end of each period during the term of an agreement, the Company calculates the incentives achieved during that period and recognizes revenue attributable to that agreement accordingly, subject to the variable constraint guidance under ASC Topic 606.

As of September 30, 2025, the Company had 498 aircraft in scheduled service or under contract pursuant to code-share agreements.

The Company’s fleet includes Embraer E175 regional jet aircraft (“E175”), Canadair CRJ900 regional jet aircraft (“CRJ900”), Canadair CRJ700 regional jet aircraft (“CRJ700”), including a 50 -seat configuration of the CRJ700 aircraft, commonly referred to as a “CRJ550,” and Canadair CRJ200 regional jet aircraft (“CRJ200”).

The following table summarizes the significant provisions of each code-share agreement the Company has with each major airline partner through SkyWest Airlines:

As of March 31, 2026, the Company had 500 aircraft in scheduled service or under contract pursuant to code-share agreements.

The Company’s fleet includes Embraer E175 regional jet aircraft (“E175”), Canadair CRJ900 regional jet aircraft (“CRJ900”), Canadair CRJ700 regional jet aircraft (“CRJ700”), a 50-seat configuration of the CRJ700 aircraft, commonly referred to as a “CRJ550,” and Canadair CRJ200 regional jet aircraft (“CRJ200”).

The following

table summarizes the significant provisions of each code-share agreement the Company has with each major airline partner through SkyWest Airlines:

United Express Agreements

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(capacity purchase agreements)

• CRJ700/CRJ550

removal dates under the agreement

removal dates under the agreements

between 2026 and 2035

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The number of aircraft listed above for each prorate agreement approximates the number of aircraft the Company uses to serve the prorate routes.

In addition to the contractual agreements described above, as of September 30, 2025, SkyWest Airlines reached agreements with certain major airline partners to place additional aircraft under capacity purchase agreements as summarized below.

In addition to the contractual agreements described above, as of March 31, 2026, SkyWest Airlines reached agreements with certain major airline partners to place additional aircraft under capacity purchase agreements as summarized below.

The Company is coordinating with its major airline partners regarding the timing of upcoming fleet deliveries and the delivery timing referenced below is subject to change.

● Capacity purchase agreement with United for 13 new E175 aircraft.

Three new E175 aircraft are currently scheduled for delivery in the fourth quarter of 2025 and ten new E175 aircraft are scheduled for delivery in 2026.

The Company anticipates financing the aircraft through debt.

● Capacity purchase agreement with Alaska for one new E175 aircraft.

The delivery date for the new E175 aircraft is currently scheduled for 2026.

● Capacity purchase agreement with United for eight new E175 aircraft, which are scheduled for delivery in 2026.

The Company anticipates financing the aircraft through debt.

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The Company anticipates financing the aircraft through debt.

● Capacity purchase agreements with United for 29 CRJ550 aircraft that are anticipated to be placed into service between the fourth quarter of 2025 and the end of 2026.

Pursuant to these agreements, the Company is in the process of converting its CRJ700s to CRJ550s.

● Capacity purchase agreement with United for 18 used CRJ550 aircraft that are anticipated to be placed into service by 2027.

Pursuant to this agreement, the Company is in the process of converting its owned CRJ700s to CRJ550s.

When an aircraft is scheduled for expiration from a capacity purchase agreement, the Company may, as practical under the circumstances, negotiate an extension with the respective major airline partner, negotiate the placement of the aircraft with another major airline partner, return the aircraft to the major airline partner when the aircraft is provided by the major airline partner, place owned aircraft for sale or pursue other uses for the aircraft.

uses for the aircraft may include placing the aircraft in a prorate agreement, leasing the aircraft to a third party or disassembling aircraft components such as the engines and parts to be used as spare inventory.

Other uses for the aircraft may include placing the aircraft in a prorate agreement, leasing the aircraft to a third party or disassembling aircraft components such as the engines and parts to be used as spare inventory.

Lease, airport services and other revenues primarily consist of revenue generated from aircraft and spare engines leased to third parties, maintenance services provided to third parties and airport customer service agreements, such as gate and ramp agent services at various airports where the Company has been contracted by third parties to provide such services.

The following table represents the Company’s lease, airport services and other revenues for the three and nine months ended September 30, 2025 and 2024 (in thousands):

For the three months ended September 30,

For the nine months ended September 30,

The following table represents the Company’s lease, airport services and other revenues for the three months ended March 31, 2026 and 2025 (in thousands):

For the three months ended March 31,

Operating lease fixed revenue

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Lease, airport services and other

The following table summarizes future minimum rental income under operating leases primarily related to leased aircraft and engines that had remaining non-cancelable lease terms as of September 30, 2025 (in thousands):

October 2025 through December 2025

April 2026 - December 2026

Total future minimum rental income under operating leases

Of the Company’s $ 5.7 billion of property and equipment, net of accumulated depreciation, as of September 30, 2025, $ 241.7 million of regional jet aircraft and spare engines were leased to third parties under operating leases.

Of the Company’s $ 5.9 billion of property and equipment, net of accumulated depreciation, as of March 31, 2026, $ 240.8 million of regional jet aircraft and spare engines were leased to third parties under operating leases.

The Company’s mitigation strategy for the residual asset risks of these assets includes leasing aircraft and engine types that can be operated by the Company in the event of a default.

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The Company monitors publicly available credit ratings for entities for which the Company has a significant receivable balance or guarantee.

As of September 30, 2025, the Company had gross receivables of $ 149.5 million in current assets and gross receivables of $ 257.8 million in other long-term assets.

As of March 31, 2026, the Company had gross receivables of $ 176.6 million in current assets and gross receivables of $ 256.7 million in other long-term assets.

As of December 31, 2025, the Company had gross receivables of $ 163.3 million in current assets and gross receivables of $ 266.3 million in other long-term assets.

The Company has established credit loss reserves based on publicly available historic default rates issued by a third party for companies with similar credit ratings, factoring in the amount and term of the Company’s

respective accounts receivable, notes receivable or guarantees.

During the nine months ended September 30, 2025, the Company increased its credit loss reserve as a result of the Company’s assessment of higher credit risk of certain outstanding receivables.

During the three months ended March 31, 2026, there were no significant changes in the outstanding accounts receivable, notes receivable, guarantees or credit ratings of the entities.

The following table summarizes the changes in allowance for credit losses (in thousands):

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Write-offs charged against allowance

Balance at September 30, 2025

Balance at March 31, 2026

(3) Capital Transactions

Stock-Based Compensation

During the nine months ended September 30, 2025, the Company granted 25,359 restricted stock units and 59,165 performance shares to certain employees of the Company under the SkyWest, Inc.

During the three months ended March 31, 2026, the Company granted 76,648 performance shares and 32,850 restricted stock units to certain employees of the Company under the SkyWest, Inc.

Amended and Restated 2019 Long-Term Incentive Plan.

Both the restricted stock units and performance shares have a three-year vesting period, during which the recipient must remain employed with the Company.

The performance shares have a three-year vesting period during which the recipient must remain employed with the Company.

The number of performance shares awardable from the 2026 grants can range from 0 % to 200 % of the original amount granted depending on the Company’s performance over three one-year measurement periods against the pre-established targets.

Upon vesting, each restricted stock unit and performance share will be replaced with one share of common stock.

The weighted average fair value of these restricted stock units and performance shares on their date of grant was $ 118.96 per share.

A dditionally, during the nine months ended September 30, 2025, the Company granted 6,275 fully vested shares of common stock and 1,255 fully vested restricted stock units to the Company’s directors at a weighted average grant date fair value of $ 97.02 .

The restricted stock units granted in 2026 will vest in three equal installments, with one -third vesting each year on the grant date anniversary.

Upon vesting, each performance share and restricted stock unit will be replaced with one share of common stock.

The weighted average fair value of these performance shares and restricted stock units on their date of grant was $ 101.47 per share.

The Company accounts for forfeitures of restricted stock units and performance shares when forfeitures occur.

The estimated fair value of the restricted stock units and performance shares is amortized over the applicable vesting periods.

The estimated fair value of the performance shares and restricted stock units is amortized over the applicable vesting periods.

Stock-based compensation expense for the performance shares is based on the Company’s anticipated outcome of achieving the performance metrics.

During the nine months ended September 30, 2025 and 2024, the Company recorded pre-tax stock-based compensation expense of $ 14.5 million and $ 15.1 million, respectively.

During the three months ended March 31, 2026 and 2025, the Company recorded pre-tax stock-based compensation expense of $ 4.4 million and $ 4.7 million, respectively.

( 4) Stock Repurchase

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In May 2025, the Board approved a $ 250.0 million increase to the existing repurchase program.

Following such increase, at September 30, 2025, $ 240.0 million remained available under the repurchase program.

During the nine months ended September 30, 2025, the Company repurchased 580,257 shares of common stock for $ 57.6 million at a weighted average price per share of $ 99.23 .

The Company also recorded $ 0.2 million of excise tax related to the stock repurchases as treasury stock in the Company’s Stockholders’ Equity for the nine months ended September 30, 2025.

During the nine months ended September 30, 2024, the Company repurchased 530,812 shares of common stock for $ 38.4 million at a weighted average price per share of $ 72.30 and recorded $ 0.3 million of excise tax related to the stock repurchases as treasury stock in the Company’s Stockholders’ Equity .

At March 31, 2026, $ 137.8 million remained available under the repurchase program.

During the three months ended March 31, 2026, the Company repurchased 782,900 shares of common stock for $ 75.3 million at a weighted average price per share of $ 96.18 .

The Company also recorded $ 0.1 million of excise tax

related to the stock repurchases as treasury stock in the Company’s stockholders’ equity for the three months ended March 31, 2026.

During the three months ended March 31, 2025, the Company repurchased 140,658 shares of common stock for $ 13.7 million at a weighted average price per share of $ 97.27 .

The Company did no t record excise tax related to the stock repurchases for the three months ended March 31, 2025 .

(5) Net Income Per Common Share

Basic net income per common share (“Basic EPS”) excludes dilution and is computed by dividing net income by the weighted average number of common shares outstanding during the period.

Diluted net income per common share

(“Diluted EPS”) reflects the potential dilution that could occur if stock options or other contracts to issue common stock were exercised or converted into common stock.

Diluted net income per common share (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other contracts to issue common stock were exercised or converted into common stock.

The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net income per common share.

During the nine months ended September 30, 2025 and 2024, 161,000 and 336,000 performance shares (at target performance) were excluded from the computation of Diluted EPS because the Company had not achieved the minimum target thresholds for these shares as of September 30, 2025 and 2024, respectively.

During the three months ended March 31, 2026 and 2025, 155,000 and 268,000 performance shares (at target performance) were excluded from the computation of Diluted EPS because the Company had not achieved the minimum target thresholds for these shares as of March 31, 2026 and 2025, respectively.

The calculation of the weighted average number of common shares outstanding for Basic EPS and Diluted EPS are as follows for the periods indicated (in thousands, except per share data):

Three Months Ended

Nine Months Ended

September 30,

Basic earnings per share weighted average shares

Dilution due to employee equity awards and warrants

Dilution due to employee equity awards

Diluted earnings per share weighted average shares

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The Company’s two reportable segments consist of (1) the operations of SkyWest Airlines and SWC (collectively, “SkyWest Airlines and SWC”) and (2) SkyWest Leasing activities.

The Company’s chief operating decision maker analyzes the profitability of operating new aircraft financed through the issuance of debt, including the Company’s E175 fleet, separately from the profitability of the Company’s capital deployed for ownership and financing of such aircraft.

The Company’s chief operating decision maker analyzes the profitability of aircraft separately from the profitability of the Company’s capital deployed for new aircraft and the related aircraft financings, including the Company’s E175 fleet.

The SkyWest Airlines and SWC segment includes revenue earned under the applicable capacity purchase agreements attributed to operating such aircraft and the respective operating costs, and revenue and operating expenses attributed to prorate agreements and airport services agreements.

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The SkyWest Leasing segment’s total assets and capital expenditures include new aircraft acquired through the issuance of debt and assets leased to third parties.

Additionally, aircraft removed from SkyWest Airlines’ operations and held for sale are included in the SkyWest Leasing segment.

The chief operating decision maker assesses performance for each segment and decides how to allocate resources based on income before income taxes.

The chief operating decision maker uses the segment profit or loss measure when assessing performance of the segment and monitors budget versus actual results to allocate resources for each segment predominantly in the annual budget and forecasting process.

The following represents the Company’s segment data for the three-month periods ended September 30, 2025 and 2024 (in thousands).

As required by the adoption of ASC 2023-07, “Segment Reporting (ASC Topic 280) – Improvements to Reportable Segment Disclosures,” the Company recast the segment disclosures for the three and nine months ended September 30, 2024 to conform to the current year presentation.

Three months ended September 30, 2025

SkyWest Airlines

Operating revenues

Salaries, wages and benefits

Aircraft maintenance, materials and repairs

Depreciation and amortization

Interest expense

Other segment expense (income) items (1)

Segment profit (2)

Total assets (as of September 30, 2025)

Capital expenditures (including non-cash)

Three months ended September 30, 2024

SkyWest Airlines

Operating revenues

Salaries, wages and benefits

Aircraft maintenance, materials and repairs

Depreciation and amortization

Interest expense

Other segment expense (income) items (1)

Segment profit (2)

Total assets (as of September 30, 2024)

Capital expenditures (including non-cash)

(1) Other segment items include aircraft fuel;

airport related expenses;

other operating expenses consisting primarily of property taxes, hull and liability insurance, simulator costs, crew per diem and crew hotel costs;

aircraft rentals;

interest income and other income (expense) , net.

(2) Segment profit is equal to income before income taxes.

As a result of adopting ASC 2023-07 in 2024, the Company included interest income and other income (expense), net in the recast segment profit for each segment for the three months ended September 30, 2024, consistent with the presentation for the three months ended September 30, 2025.

Nine months ended September 30, 2025

The chief operating decision maker uses the segment profit or loss

measure when assessing performance of the segment and monitors budget versus actual results to allocate resources for each segment predominantly in the annual budget and forecasting process.

The following represents the Company’s segment data for the three-month periods ended March 31, 2026 and 2025 (in thousands).

Three months ended March 31, 2026

SkyWest Airlines

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Segment profit (2)

Total assets (as of September 30, 2025)

Total assets (as of March 31, 2026)

Capital expenditures (including non-cash)

Nine months ended September 30, 2024

Deposits on aircraft

Three months ended March 31, 2025

SkyWest Airlines

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Segment profit (2)

Total assets (as of September 30, 2024)

Total assets (as of March 31, 2025)

Capital expenditures (including non-cash)

Deposits on aircraft

(1) Other segment items include aircraft fuel;

airport related expenses;

other operating expenses consisting primarily of property taxes, hull and liability insurance, simulator costs, crew per diem and crew hotel costs;

aircraft rentals;

interest income and other income (expense) , net.

other operating expenses consisting primarily of property taxes, hull and liability insurance, simulator costs, aircraft rentals, crew per diem and crew hotel costs;

interest income and other expense , net.

(2) Segment profit is equal to income before income taxes.

As a result of adopting ASC 2023-07 in 2024, the Company included interest income and other income (expense), net in the recast segment profit for each segment for the nine months ended September 30, 2024, consistent with the presentation for the nine months ended September 30, 2025.

(7) Leases, Commitments, Guarantees and Contingencies

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The Company used its incremental borrowing rate to discount the lease payments based on information available at lease commencement.

As of September 30, 2025, excluding aircraft financed by the Company’s major airline partners that the Company operates for them under contract, the Company leased eight aircraft under long-term lease agreements with remaining terms ranging from four to five years .

As of March 31, 2026, excluding aircraft financed by the Company’s major airline partners that the Company operates for them under contract, the Company leased eight aircraft under long-term lease agreements with remaining terms ranging from three to four years .

The Company is subleasing these eight aircraft to a third party.

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The Company’s operating leases with lease rates that are variable based on airport operating costs, use of the facilities or other variable factors are excluded from the Company’s right-of-use assets and operating lease liabilities in accordance with accounting guidance.

As of September 30, 2025, the Company’s right-of-use assets were $ 84.8 million, the Company’s current maturities of operating lease liabilities were $ 20.0 million, and the Company’s noncurrent lease liabilities were $ 64.8 million.

During the nine months ended September 30, 2025, the Company paid $ 25.4 million under operating leases reflected as a reduction from operating cash flows.

The table below presents lease related terms and discount rates as of September 30, 2025:

As of March 31, 2026, the Company’s right-of-use assets were $ 82.9 million, the Company’s current maturities of operating lease liabilities were $ 20.8 million, and the Company’s noncurrent lease liabilities were $ 62.1 million.

During the three months ended March 31, 2026, the Company paid $ 11.9 million under operating leases reflected as a reduction from operating cash flows.

The table below presents lease related terms and discount rates as of March 31, 2026:

Weighted-average remaining lease term for operating leases

Weighted-average discount rate for operating leases

The Company’s lease costs for the three and nine months ended September 30, 2025 and 2024 included the following components (in thousands):

For the three months ended September 30,

For the nine months ended September 30,

The Company’s lease costs for the three months ended March 31, 2026 and 2025 included the following components (in thousands):

For the three months ended March 31,

Operating lease cost

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Total lease cost

As of September 30, 2025, the Company leased aircraft, airport facilities, office space and other property and equipment under non-cancelable operating leases, which are generally on a long-term, triple-net lease basis pursuant to which the Company pays taxes, maintenance, insurance and certain other operating expenses applicable to the leased property.

As of March 31, 2026, the Company leased aircraft, airport facilities, office space and other property and equipment under non-cancelable operating leases, which are generally under long-term agreements pursuant to which the Company pays taxes, maintenance, insurance and certain other operating expenses applicable to the leased property.

The Company expects that, in the normal course of business, such operating leases that expire will be renewed or replaced by other leases.

As of September 30, 2025, the Company had a firm purchase commitment for 74 E175 aircraft from Embraer with anticipated delivery dates through 2032, including a purchase agreement the Company entered into with Embraer during the second quarter of 2025.

Under this commitment, the Company expects to purchase and place into service 13 E175 aircraft with United, one E175 aircraft with Alaska and 16 E175 aircraft with Delta.

Additionally, the Company has secured delivery positions for 44 additional E175 aircraft from 2028 through 2032.

The Company also had a purchase agreement to acquire 12 used CRJ900 airframes with anticipated closing dates in 2025.

The following table summarizes the Company’s commitments and obligations for future minimum rental payments required under operating leases that had initial or remaining non-cancelable lease terms as of September 30, 2025, firm aircraft and spare engine commitments, interest commitments and principal maturities on long-term debt as noted for each of the next five years and thereafter (in thousands):

Oct - Dec 2025

As of March 31, 2026, the Company had a firm purchase commitment for 68 E175 aircraft from Embraer with anticipated delivery dates through 2032.

Under this commitment, the Company expects to purchase and place into service eight E175 aircraft with United and 16 E175 aircraft with Delta.

Additionally, the Company secured delivery positions for 44 additional E175 aircraft between 2028 and 2032.

The following table summarizes the Company’s commitments and obligations for future minimum rental payments required under operating leases that had initial or remaining non-cancelable lease terms as of March 31, 2026, firm aircraft and spare engine commitments, interest commitments and principal maturities on long-term debt as noted for each of the next five years and thereafter (in thousands):

Apr - Dec 2026

Operating lease payments for aircraft and facility obligations

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The Company accounted for the transaction as a failed sale-leaseback in accordance with ASC 842 as the criteria for a sale were not met.

At September 30, 2025, the Company estimated the remaining financing obligation under the agreement will be between $ 40.0 million and $ 50.0 million and anticipated closing on the remaining financings through 2026.

At March 31, 2026, the Company estimated the remaining financing obligation under the agreement will be between $ 20.0 million and $ 25.0 million and anticipated closing on the remaining financings during 2026.

In 2022, the Company agreed to guarantee $ 19.8 million of debt for a 14 CFR Part 135 air carrier.

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In exchange for providing the guarantee, the Company received 6.5 % of the guaranteed amount as consideration, payable in the estimated value of common stock of the Part 135 air carrier, all of which was sold in 2023.

The balance of the debt under the guarantee was $ 13.0 million as of September 30, 2025.

In 2023, the Company agreed to guarantee up to $ 12.0 million of debt for an aviation school.

The debt was secured by the school’s aircraft and engines and had a five-year term.

In exchange for providing the guarantee, the Company received 2.0 % of the guaranteed amount annually as consideration in cash.

In June 2025, the aviation school fully repaid the debt under the guarantee agreement.

As a result, the Company was no longer a guarantor at September 30, 2025.

The purpose of these guarantees is to help reduce the financing costs of aircraft for the third parties in an effort to increase the potential number of commercial pilots in the Company’s hiring pipeline.

The Company also recorded the estimated credit loss associated with the guarantees based on publicly available historical default rates issued by a third party for companies with similar credit ratings, factoring the collateral and guarantee term.

The purpose of this guarantee is to help reduce the financing costs of aircraft for the third party in an effort to increase the potential number of commercial pilots in the Company’s hiring pipeline.

The balance of the debt under the guarantee was $ 12.2 million as of March 31, 2026.

The Company recorded the estimated credit loss associated with the guarantees based on publicly available historical default rates issued by a third party for companies with similar credit ratings, factoring the collateral and guarantee term.

(8) Fair Value Measurements

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Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities, therefore requiring an entity to develop its own assumptions.

As of September 30, 2025, and December 31, 2024, the Company held certain assets that are required to be measured at fair value on a recurring basis.

As of March 31, 2026, and December 31, 2025, the Company held certain assets that are required to be measured at fair value on a recurring basis.

Assets measured at fair value on a recurring basis are summarized below (in thousands):

Fair Value Measurements as of September 30, 2025

Fair Value Measurements as of March 31, 2026

Marketable Securities

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The Company’s “Marketable Securities” classified as Level 2 securities primarily utilize broker quotes in a non-active market for valuation of these securities.

During the three months ended September 30, 2025, the Company exercised its warrant to purchase 1,500,000 shares of common stock of Eve Holding, Inc.

(“Eve”) through a cashless exercise and received shares of common stock of Eve.

See Note 10 “Investments in Other Companies” for additional information regarding the Company’s investment in Eve.

The warrant was classified as Level 3 within the fair value hierarchy as of June 30, 2025.

The Company’s shares of Eve’s common stock are actively traded and are valued using quoted market prices and are classified as Level 1 within the fair value hierarchy as of September 30, 2025.

The Company did not make any significant transfers of securities between Level 1, Level 2 and Level 3 during the three months ended March 31, 2026.

The Company’s policy regarding the recording of transfers between levels is to record any such transfers at the end of the reporting period.

As of September 30, 2025, and December 31, 2024, the Company classified $ 708.8 million and $ 574.3 million of marketable securities, respectively, as short-term because it had the intent to maintain a liquid portfolio and the ability to redeem the securities within one year .

At the time of sale, any realized appreciation or depreciation, calculated by the specific identification method, is recognized in other income (expense), net.

As of September 30, 2025, and December 31, 2024, the cost of the Company’s marketable securities was $ 708.4 million and $ 574.0 million, respectively.

As of March 31, 2026, and December 31, 2025, the Company classified $ 561.4 million and $ 584.2 million of marketable securities, respectively, as short-term because it had the intent to maintain a liquid portfolio and the ability to redeem the securities within one year .

At the time of sale, any realized appreciation or depreciation, calculated by the specific identification method, is recognized in other expense, net.

As of March 31, 2026, and December 31, 2025, the cost of the Company’s marketable securities was $ 561.9 million and $ 583.9 million, respectively.

(9) Long-term Debt

Long-term debt consisted of the following as of September 30, 2025, and December 31, 2024 (in thousands):

September 30, 2025

Long-term debt consisted of the following as of March 31, 2026, and December 31, 2025 (in thousands):

March 31, 2026

December 31, 2025

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Total long-term debt, net of debt issue costs

As of September 30, 2025, the Company had $ 2.4 billion of total long-term debt, which consisted of $ 2.2 billion of debt used to finance aircraft and spare engines and $ 200.6 million of unsecured debt payable to the U.S.

As of March 31, 2026, the Company had $ 2.4 billion of total long-term debt, which consisted of $ 2.2 billion of debt used to finance aircraft and spare engines and $ 200.6 million of unsecured debt payable to the U.S.

Department of the Treasury (“Treasury”).

As of September 30, 2025, $ 95.4 million of the debt payable to Treasury had a fixed annual interest rate of 1 % and $ 105.2 million had a variable interest rate of the Secured Overnight Financing Rate (" SOFR ") plus 2.0 % .

The interest rate under the $ 95.4 million unsecured loans is scheduled to increase to the applicable SOFR rate plus 2.0 % upon the fifth anniversary of each disbursement.

The Company received disbursements under these unsecured loans from January 2021 through April 2021.

The average effective interest rate on the Company’s debt was approximately 4.3 % at September 30, 2025.

During the nine months ended September 30, 2025, the Company took delivery of two new E175 aircraft that the Company financed through $ 47.1 million of long-term debt.

The debt associated with the two E175 aircraft has a 12-year term, is due in quarterly installments, and is secured by the E175 aircraft.

As of September 30, 2025 and December 31, 2024, the Company had $ 47.3 million and $ 47.1 million, respectively, in letters of credit and surety bonds outstanding with various banks and surety institutions.

As of September 30, 2025, SkyWest Airlines had a $ 100.0 million line of credit.

As of March 31, 2026, $ 55.5 million of the unsecured debt payable to Treasury had a fixed annual interest rate of 1.0 % , which increased to the applicable Secured Overnight Financing Rate ("SOFR") plus 2.0 % in April 2026.

The remaining $ 145.1 million had a variable interest rate of SOFR plus 2.0 % .

The average effective interest rate on the Company’s debt was approximately 4.4 % at March 31, 2026.

During the three months ended March 31, 2026, the Company took delivery of one new E175 aircraft that the Company financed through $ 23.6 million of long-term debt.

The debt associated with the E175 aircraft has a 12 -year term, is due in quarterly installments, and is secured by the E175 aircraft.

During the three months ended March 31, 2026, the Company executed promissory notes for $ 94.0 million.

The promissory notes have four-year terms, are due in monthly installments, and are secured by spare engines.

As of March 31, 2026 and December 31, 2025, the Company had $ 47.5 million and $ 47.2 million, respectively, in letters of credit and surety bonds outstanding with various banks and surety institutions.

As of March 31, 2026, SkyWest Airlines had a $ 100.0 million line of credit.

The line of credit includes minimum liquidity and profitability covenants and is secured by certain assets.

As of September 30, 2025, SkyWest Airlines had no amounts outstanding under the line of credit facility.

However, at September 30, 2025, SkyWest Airlines had $ 24.5 million in letters of credit issued under the facility, which reduced the amount available under the facility to $ 75.5 million.

As of March 31, 2026, SkyWest Airlines had no amounts outstanding under the line of credit facility.

However, at March 31, 2026, SkyWest Airlines had $ 24.6 million in letters of credit issued under the facility, which reduced the amount available under the facility to $ 75.4 million.

The line of credit expires March 25, 2028 and has a variable interest rate of 3.5 % plus the one month SOFR rate.

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The fair value of debt is estimated using inputs classified as Level 2 within the fair value hierarchy.

The carrying value and fair value of the Company’s long-term debt as of September 30, 2025 and December 31, 2024, were as follows (in thousands):

September 30, 2025

The carrying value and fair value of the Company’s long-term debt as of March 31, 2026 and December 31, 2025, were as follows (in thousands):

March 31, 2026

December 31, 2025

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During 2019, the Company created a joint venture with Regional One, Inc.

(“Regional One”) and, as of September 30, 2025, has invested a total of $ 26.6 million for a 75 % ownership interest in Aero Engines, LLC.

(“Regional One”) and, as of March 31, 2026, has invested a total of $ 26.6 million for a 75 % ownership interest in Aero Engines, LLC.

(“Aero Engines”).

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The Company’s exposure in its investment in Aero Engines primarily consists of the Company’s portion of income or loss from Aero Engines’ engine lease agreements with third parties and the Company’s ownership percentage in Aero Engines’ engines book value.

Aero Engines had no debt outstanding as of September 30, 2025.

As of September 30, 2025 and December 31, 2024, the Company’s investment balance in Aero Engines was $ 12.5 million and $ 23.9 million, respectively, and has been recorded in “Other Assets” on the Company’s consolidated balance sheet.

During the nine months ended September 30, 2025, the Company received a $ 12.0 million distribution from Aero Engines, which reduced the Company’s investment balance in Aero Engines from December 31, 2024.

The Company’s portion of income generated by Aero Engines for the nine months ended September 30, 2025, was $ 0.6 million, which is recorded in “Other income (expense), net” on the Company’s consolidated statements of comprehensive income.

Aero Engines had no debt outstanding as of March 31, 2026.

During 2025, the Company received a $ 12.0 million distribution from Aero Engines, which reduced the Company’s investment balance in Aero Engines.

As of March 31, 2026 and December 31, 2025, the Company’s investment balance in Aero Engines was $ 13.4 million and $ 12.8 million, respectively, and was recorded in “Other Assets” on the Company’s consolidated balance sheet.

The Company’s portion of income generated by Aero Engines for the three months ended March 31, 2026 and 2025, was $ 0.5 million and $ 0.6 million, respectively, which was recorded in “Other expense, net” on the Company’s consolidated statements of comprehensive income.

In December 2023, the Company invested $ 9.9 million for a 9.9 % ownership interest in Corporate Flight Management, Inc.

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In January 2024, the Company invested an additional $ 15.1 million in Contour.

The Company has a 25 % ownership interest in Contour at September 30, 2025 and holds one of five seats, or 20 % , on Contour’s board of directors.

The Company had a 25 % ownership interest in Contour at March 31,

2026 and held one of five seats, or 20 % , on Contour’s board of directors.

The Contour arrangement also includes an asset provisioning agreement under which the Company will provide CRJ airframes, engines and rotable parts to Contour.

The Company accounts for its investment in Contour under the equity method where the investment is reported at cost and adjusted each period for the Company’s share of Contour’s income or loss, recorded on a one quarter lag.

For the nine months ended September 30, 2025, the Company recorded income of $ 1.4 million, its portion of income generated by Contour, which was recorded in “Other income (expense), net” on the Company’s consolidated statements of comprehensive income.

As of September 30, 2025, the Company’s investment balance in Contour of $ 22.8 million was recorded in “Other Assets” on the Company’s consolidated balance sheet.

At September 30, 2025, the Company had $ 8.7 million in notes receivable from Contour related to the sale of aircraft under the asset provisioning agreement.

The notes are secured by aircraft and collectible within four years .

For the three months ended March 31, 2026 and 2025, the Company recorded income of $ 0.7 million and $ 0.9 million, respectively, related to its Contour investment, its portion of income generated by Contour, which was recorded in “Other expense, net” on the Company’s consolidated statements of comprehensive income.

As of March 31, 2026 and December 31, 2025, the Company’s investment balance in Contour was $ 23.5 million and $ 22.8 million, respectively, and was recorded in “Other Assets” on the Company’s consolidated balance sheet.

At March 31, 2026, the Company had $ 7.9 million in notes receivable from Contour related to the sale of aircraft under the asset provisioning agreement.

The notes are secured by aircraft and collectible within three years .

The Company assesses investments for impairment whenever events or changes in circumstances indicate that the carrying value of an investment may not be recoverable.

Fair Value Method Investment

In 2021, the Company entered into a strategic partnership with Eve, to develop a network of deployment for Eve’s electric vertical takeoff and landing aircraft.

In 2022, the Company acquired 1,000,000 shares of common stock of Eve and a warrant giving the Company the right to acquire 1,500,000 shares of common stock of Eve at an exercise price of $ 0.01 per share.

The Company also received a put option from an Eve shareholder for the 1,000,000 shares of common stock of Eve payable in aircraft parts credits.

The intent of the put option was to reduce the Company’s investment risk in Eve.

The Company is restricted

from selling the shares underlying the warrant until May 2025, and the warrant expires in May 2032.

The Company acquired the shares of common stock, warrant and put option (collectively the “Eve Investments”) for $ 10.0 million.

The Company evaluated the Eve Investments under ASC Topic 321, “Investments – Equity Securities” and ASC Topic 815, “Derivatives and Hedging,” and recorded the Eve Investments based on their pro rata share of the consideration paid using the fair value of the Eve Investments on the acquisition date, with subsequent changes in the fair value report ed in earnings.

During the year ended December 31, 2023, the Company sold 600,411 shares of common stock of Eve, which concurrently forfeited 600,411 shares subject to the put option from the Eve shareholder.

During the year ended December 31, 2024, the Company exercised the remainder of the put option and received aircraft parts credits in exchange for the 399,589 shares of common stock.

During the three months ended September 30, 2025, the Company exercised its warrant to purchase 1,500,000 shares of common stock of Eve.

The Company received 1,497,635 shares of common stock of Eve resulting from a cashless exercise.

The warrant was classified as Level 3 within the fair value hierarchy (“Eve Level 3 Investment”) as of June 30, 2025.

The Company used the Black Scholes Option Pricing Model to determine the estimated fair market value of the Eve Level 3 Investment .

Upon exercise, the Company’s shares of common stock of Eve were classified as Level 1 within the fair value hierarchy as Eve’s common shares are actively traded and are valued using quoted market prices.

The table below shows the reconciliation of the Eve Level 3 Investment (in thousands):

Eve Level 3 Investment:

Balance at December 31, 2024

Unrealized loss

Exercise of warrant to common stock (level 1)

Balance at September 30, 2025

During the nine months ended September 30, 2025, the Company recorded an unrealized loss of $ 2.4 million in “Other income (expense), net” on the Company’s consolidated statements of comprehensive income related to the Eve Investments.

During the nine months ended September 30, 2024, the Company recorded a net loss of $ 6.6 million in “Other income (expense), net” on the Company’s consolidated statements of comprehensive income, including a realized gain of $ 3.4 million from the exercise of the put option, a realized loss of $ 1.4 million from the forfeited shares of Eve common stock and unrealized losses of $ 8.6 million related to the Eve Investments.

As of September 30, 2025 and December 31, 2024, the fair value of the Eve Investments was $ 5.7 million and $ 8.2 million, respectively, and was recorded in “Other Assets” on the Company’s consolidated balance sheet.

In 2021, the Company entered into a strategic arrangement with Eve Holding, Inc.

(“Eve”), to develop a network of deployment for Eve’s electric vertical takeoff and landing aircraft.

As of March 31, 2026 and December 31, 2025, the Company held 1.1 million common shares of Eve.

During the three months ended March 31, 2026, the Company recorded an unrealized loss of $ 1.6 million in “Other expense, net” on the Company’s consolidated statements of comprehensive income related to its investment in Eve.

During the three months ended March 31, 2025, the Company recorded an unrealized loss of $ 3.2 million in “Other expense, net” on the Company’s consolidated statements of comprehensive income related to its investment in Eve.

As of March 31, 2026 and December 31, 2025, the fair value of the Company’s investment in Eve was $ 2.6 million and $ 4.3 million, respectively, and was recorded in “Other Assets” on the Company’s consolidated balance sheet.

(11) Income Taxes

The Company’s effective tax rate for the nine months ended September 30, 2025 was 23.5 %.

The Company’s effective tax rate for the nine months ended September 30, 2025 varied from the federal statutory rate of 21.0 % primarily due to the provision for state income taxes and the impact of non-deductible expense, partially offset by a discrete tax benefit from additional tax deductions generated from employee equity awards that vested during the nine months ended September 30, 2025.

The Company’s effective tax rate for the nine months ended September 30, 2024 was 24.4 %.

The Company’s effective tax rate for the nine months ended September 30, 2024 varied from the federal statutory rate of 21.0 % primarily due to the provision for state income taxes and the impact of non-deductible expenses.

This was partially offset by a discrete tax benefit from additional tax deductions generated from employee equity awards that vested during the nine months ended September 30, 2024, a discrete tax benefit from the release of a previously recorded uncertain tax position liability and a discrete tax benefit from a release of the valuation allowance on state net operating losses anticipated to be utilized prior to expiration.

On July 4, 2025, the One Big Beautiful Bill Act was signed into law.

The legislation did not have a material impact on our income tax expense for the quarter ended September 30, 2025, and we do not expect it to materially change our effective income tax rate for the year ending December 31, 2025.

The Company’s effective tax rate for the three months ended March 31, 2026 was 5.6 %.

The Company’s effective tax rate for the three months ended March 31, 2026 varied from the federal statutory rate of 21.0 % primarily due to the impact of a discrete tax benefit from additional tax deductions generated from employee equity awards that vested at a stock price above the grant date price during the three months ended March 31, 2026, offset by the provision for state income taxes and the impact of non-deductible expenses.

The Company’s effective tax rate for the three months ended March 31, 2025 was 16.7 %.

The Company’s effective tax rate for the three months ended March 31, 2025 varied from the federal statutory rate of 21.0 % primarily due to the impact of a discrete tax benefit from additional tax deductions generated from employee equity awards that vested during the three months ended March 31, 2025, offset by the provision for state income taxes and the impact of non-deductible expenses.

(12) Legal Matters

The Company is subject to certain legal actions which it considers routine to its business activities.

As of September 30, 2025, the Company’s management believed, after consultation with legal counsel, that the ultimate outcome of such legal matters was not likely to have a material adverse effect on the Company’s financial position, liquidity or results of operations.

As of March 31, 2026, the Company’s management believed, after consultation with legal counsel, that the ultimate outcome of such legal matters was not likely to have a material adverse effect on the Company’s financial position, liquidity or results of operations.

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-Q

Item 1. Financial Statements