SkyWest, Inc.

What they do

Through its primary operating subsidiary SkyWest Airlines, the company flies regional jet service to destinations in the United States, Canada and Mexico. Substantially all flights are operated as United Express, Delta Connection, American Eagle or Alaska Airlines flights under long-term, fixed-fee capacity purchase agreements. As of December 31, 2025, it offered approximately 2,260 daily departures and had 637 total aircraft, of which 487 were in scheduled service or under contract.

Revenue drivers

• United Express — The largest partner by departures, with approximately 940 daily departures as of December 31, 2025, and 216 aircraft in scheduled service, including 121 E175s and 58 CRJ200s.
• Delta Connection — Approximately 680 daily departures as of December 31, 2025, and 137 aircraft in scheduled service, including 87 E175s, 32 CRJ900s and 18 CRJ700/CRJ550s.
• American Eagle — Approximately 420 daily departures as of December 31, 2025, and 92 aircraft in scheduled service, including 68 CRJ700/CRJ550s; the company secured an agreement to add 11 new E175s for American to replace 11 CRJ700s.
• Alaska Airlines — Approximately 210 daily departures as of December 31, 2025, and 42 E175 aircraft in scheduled service; one E175 was delivered for Alaska in the first half of 2026.

Recent performance

Q2 2026 revenue was $1.1 billion, up $68 million, or 7%, from $1.0 billion in Q2 2025, as block hour production rose 5% year over year and 9% sequentially. Q2 2026 net income was $101 million, or $2.54 per diluted share, compared with $120 million, or $2.91 per diluted share, in Q2 2025; results were negatively impacted by higher prorate fuel cost per gallon. Operating expenses rose 9% to $947 million, driven by higher production and prorate fuel costs. Q2 2026 pre-tax income was $139 million, a 29% increase from Q1 2026. The company repurchased 833,000 shares for approximately $75 million in Q2 2026 and ended the quarter with $601 million in cash and marketable securities and $2.3 billion of total debt.

Strategy

Management is focused on expanding E175 ownership and operations, stating the company is preparing to invest in owning and operating 34 more E175s through the end of 2028. SkyWest secured an agreement to purchase and operate 11 new E175 aircraft for American under a multi-year flying contract, replacing 11 CRJ700s. A purchase agreement with Embraer secures delivery positions for 33 additional E175s from 2028 through 2032, plus purchase rights for 50 more. The company expects to have 300 E175 aircraft by the end of 2027. It also approved a $250 million increase to its stock repurchase program in July 2026.

Risks

• Partner concentration — Substantially all revenue comes from United, Delta, American and Alaska under capacity purchase agreements, so the loss or renegotiation of any one contract would materially affect results.
• Schedule control — Flight schedules are determined by the major airline partners, and reductions to those schedules would directly reduce SkyWest's production and revenue.
• Fuel cost exposure — Q2 2026 results were negatively impacted by higher prorate fuel cost per gallon, and the company notes that fuel prices can affect the number of flights scheduled and prorate profitability.
• Pilot and labor availability — The company cites the ability to attract and retain qualified pilots, mechanics and other personnel, along with pilot rest rules and qualification requirements, as ongoing risks.

Outlook

Management says block hour production outlook remains solid and cites higher fleet utilization and strong demand. The company expects to take delivery of 69 E175 aircraft across 2026 through thereafter, with 13 scheduled in 2026 and 17 in 2027, and anticipates 300 E175s in the fleet by the end of 2027. It continues to invest in E175 ownership as a source of long-term value and cash flow.