SKYWEST INC Leases Disclosure
(6) Leases
The Company leases property and equipment under operating leases. For leases with durations longer than 12 months, the Company recorded the related operating lease right-of-use asset and operating lease liability at the present value of lease payments over the term. The Company used its incremental borrowing rate to discount the lease payments based on information available at lease commencement.
Aircraft
As of December 31, 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 to five years. The Company is subleasing these eight aircraft to a third party.
Airport facilities
The Company has operating leases for facility space including airport terminals, office space, cargo warehouses and maintenance facilities. The Company generally leases this space from government agencies that control the use of the various airports. The remaining lease terms for facility space vary from one month to 31 years. 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.
Leases
As of December 31, 2025, the Company’s right-of-use assets were $81.9 million, the Company’s current maturities of operating lease liabilities were $19.6 million, and the Company’s noncurrent lease liabilities were $62.3 million. During 2025, the Company paid $34.1 million under operating leases reflected as a reduction from operating activities cash flows.
The table below presents lease related terms and discount rates as of December 31, 2025:
Weighted-average remaining lease term for operating leases | 10.3 years |
Weighted-average discount rate for operating leases | 6.2% |
The Company’s lease costs for 2025, 2024 and 2023 included the following components (in thousands):
For the year ended December 31, | |||||||||
| 2025 | | 2024 | | 2023 | ||||
Operating lease cost | $ | 36,794 | $ | 28,260 | $ | 48,169 | |||
Variable and short-term lease cost |
| 2,220 |
| 2,534 |
| 2,840 | |||
Sublease income | (4,014) | (5,050) | (5,402) | ||||||
Total lease cost | $ | 35,000 | $ | 25,744 | $ | 45,607 | |||
As of December 31, 2025, 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.
The following table reconciles future minimum rental payments required under operating leases that had initial or remaining non-cancelable lease terms as of December 31, 2025 to the operating lease liabilities recorded on the consolidated balance sheet (in thousands):
2026 | | $ | 20,264 |
2027 |
| 19,680 | |
2028 |
| 13,874 | |
2029 |
| 12,143 | |
2030 |
| 6,079 | |
2031 and thereafter |
| 46,959 | |
Total minimum lease payments | 118,999 | ||
Less: imputed interest |
| (37,056) | |
Present value of future lease payments | 81,943 | ||
Less: current maturities of operating lease liabilities | (19,629) | ||
Long-term operating lease liabilities | $ | 62,314 |
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 17, 2026 | Showing above |
| 2024 | Feb 13, 2025 | |
| 2023 | Feb 15, 2024 | |
| 2022 | Feb 16, 2023 | |
| 2021 | Feb 17, 2022 | |
| 2020 | Feb 22, 2021 | |
| 2019 | Feb 18, 2020 | |
About Leases Disclosures
Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.
Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.