Sun Country Airlines Holdings, LLCSNCY
Sun Country Airlines Holdings, LLC Segments Disclosure
18. OPERATING SEGMENTS
Operating segments are defined as components of an enterprise about which separate financial information is both available and evaluated regularly by the CODM and is used in resource allocation and performance assessments. The Company’s CODM is considered to be the Company’s President and Chief Executive Officer. The Company has two operating and reportable segments: Passenger and Cargo, which are determined by the services provided and fleet utilized. The CODM makes resource allocation decisions with the objective of generating high returns and margins and mitigating the seasonality of the Company’s route network. The CODM assesses performance using multiple measures. Operating Income is the measure of segment profit that is the most consistent with the amounts presented in the Company’s Consolidated Financial Statements, as well as the measures the CODM uses to assess segment performance. The accounting policies for the Company’s reportable segments are consistent with those described in the Summary of Significant Accounting Policies included within Note 2 of these Consolidated Financial Statements. There are no intercompany transactions between the Company’s reportable segments.
The Company’s Passenger segment is comprised of two businesses: Scheduled Service and Charter. The Scheduled Service business provides passenger airline service primarily to leisure and VFR travelers. The Scheduled Service business offers a base fare and allows customers to purchase ancillary products and services for an additional fee. Sources of our ancillary revenue include air travel-related services such as baggage fees, seat selection and upgrade fees, priority check-in and boarding fees, other fees and on-board sales. The Charter business includes ad hoc, repeat, short-term and long-term service contracts. Under these Charter agreements, the Company is obligated to provide aircraft, crew, maintenance, and insurance for travel. Our diverse Charter customer base includes, but is not limited to the DoW, collegiate and professional sports teams and casinos.
Both Scheduled Service and Charter utilize the Company's Passenger fleet. The CODM maximizes the return on these aircraft through the combination of both the Scheduled Service and Charter flights. This allows for the most profitable use of the aircraft, either Scheduled Service or Charter, to be selected at any point in time. The Company regularly schedules its aircraft and crew on trips that combine Scheduled Service and Charter legs, dynamically replacing what would be lower margin Scheduled Service flights with Charter opportunities. The Company determined that it was appropriate that these businesses be viewed as a singular Passenger operating segment as the CODM evaluates the combined financial results of these businesses, due to their complimentary nature, to ensure the highest levels of returns for the Passenger fleet. Operating revenues for the Passenger segment also includes amounts recorded within Other Revenue. This is in line with how the CODM regularly reviews results and allocates resources.
The Cargo segment began providing CMI service under the ATSA in May 2020. In June 2024, the Company entered into the A&R ATSA with Amazon. The CMI service is asset-light, as Amazon supplies the aircraft under the A&R ATSA. Currently, Amazon is our only CMI customer. The Company is responsible for flying the aircraft under its air carrier certificate, crew, aircraft line maintenance and insurance. Fuel consumed in Cargo operations is directly reimbursed by Amazon and therefore aircraft fuel revenue is presented net of such reimbursements on the Consolidated Statements of Operations. Fuel consumed in Cargo maintenance activities is included within Aircraft Fuel expense in the Cargo segment. Certain operating expenses are directly attributable to the Cargo operating segment.
Certain operating expenses are allocated between the Passenger and Cargo segments. Non-Fuel operating expenses are allocated based on metrics such as block hours, fleet count and departures, which best align with the nature of the respective expense. Other Operating, net includes crew and other employee travel, interrupted trip expenses, information technology, property taxes and insurance, including hull-liability insurance, supplies, legal and other professional fees, facilities and all other administrative and operational overhead expenses. The CODM does not consider Interest Income, Interest Expense, and Other Income, net, in assessing the financial performance of its operating segments. Collectively, these items are included in reconciliations of reporting segment financial amounts to consolidated financial amounts.
The following tables present financial information for the Company’s two segments. Primarily all of the Company’s long-lived assets are owned by, or associated with, the Passenger operating segment. Therefore, predominately all depreciation and amortization expense is associated with the Passenger operating segment. Substantially all the Company’s tangible assets are located in the U.S. The Company's Aircraft and Flight Equipment is mobile across geographic markets. As a result, assets by segment are not reviewed by the CODM and have not been presented herein.
Year Ended December 31, 2025 | |||||||||||||||||
| Passenger | Cargo | Total | |||||||||||||||
| Operating Revenues | $ | 971,742 | $ | 155,027 | $ | 1,126,769 | |||||||||||
| Operating Expenses: | |||||||||||||||||
| Aircraft Fuel | 213,109 | 371 | 213,480 | ||||||||||||||
| Salaries, Wages, and Benefits | 272,841 | 99,756 | 372,597 | ||||||||||||||
| Maintenance | 59,124 | 21,225 | 80,349 | ||||||||||||||
| Sales and Marketing | 33,300 | — | 33,300 | ||||||||||||||
| Depreciation and Amortization | 98,860 | 18 | 98,878 | ||||||||||||||
| Ground Handling | 44,691 | 10 | 44,701 | ||||||||||||||
| Landing Fees and Airport Rent | 64,029 | 732 | 64,761 | ||||||||||||||
Special Items, net | 1,886 | — | 1,886 | ||||||||||||||
| Other Operating, net | 86,839 | 29,405 | 116,244 | ||||||||||||||
| Total Operating Expenses | 874,679 | 151,517 | 1,026,196 | ||||||||||||||
| Operating Income | $ | 97,063 | $ | 3,510 | 100,573 | ||||||||||||
| Interest Income | 6,973 | ||||||||||||||||
| Interest Expense | (36,861) | ||||||||||||||||
| Other, net | (474) | ||||||||||||||||
| Income Before Income Tax | $ | 70,211 | |||||||||||||||
Year Ended December 31, 2024 | |||||||||||||||||
| Passenger | Cargo | Total | |||||||||||||||
| Operating Revenues | $ | 968,565 | $ | 107,174 | $ | 1,075,739 | |||||||||||
| Operating Expenses: | |||||||||||||||||
| Aircraft Fuel | 237,108 | 52 | 237,160 | ||||||||||||||
| Salaries, Wages, and Benefits | 255,887 | 70,888 | 326,775 | ||||||||||||||
| Maintenance | 54,619 | 14,151 | 68,770 | ||||||||||||||
| Sales and Marketing | 34,935 | — | 34,935 | ||||||||||||||
| Depreciation and Amortization | 94,971 | 18 | 94,989 | ||||||||||||||
| Ground Handling | 42,102 | 16 | 42,118 | ||||||||||||||
| Landing Fees and Airport Rent | 58,951 | 598 | 59,549 | ||||||||||||||
| Other Operating, net | 85,199 | 20,258 | 105,457 | ||||||||||||||
| Total Operating Expenses | 863,772 | 105,981 | 969,753 | ||||||||||||||
Operating Income | $ | 104,793 | $ | 1,193 | 105,986 | ||||||||||||
| Interest Income | 7,833 | ||||||||||||||||
| Interest Expense | (44,300) | ||||||||||||||||
| Other, net | 55 | ||||||||||||||||
| Income Before Income Tax | $ | 69,574 | |||||||||||||||
Year Ended December 31, 2023 | |||||||||||||||||
| Passenger | Cargo | Total | |||||||||||||||
| Operating Revenues | $ | 949,885 | $ | 99,735 | $ | 1,049,620 | |||||||||||
| Operating Expenses: | |||||||||||||||||
| Aircraft Fuel | 246,600 | 69 | 246,669 | ||||||||||||||
| Salaries, Wages, and Benefits | 225,744 | 69,896 | 295,640 | ||||||||||||||
| Aircraft Rent | 2,281 | — | 2,281 | ||||||||||||||
| Maintenance | 46,211 | 14,377 | 60,588 | ||||||||||||||
| Sales and Marketing | 34,105 | — | 34,105 | ||||||||||||||
| Depreciation and Amortization | 88,098 | 53 | 88,151 | ||||||||||||||
| Ground Handling | 37,506 | — | 37,506 | ||||||||||||||
| Landing Fees and Airport Rent | 49,175 | 440 | 49,615 | ||||||||||||||
| Other Operating, net | 87,293 | 20,272 | 107,565 | ||||||||||||||
| Total Operating Expenses | 817,013 | 105,107 | 922,120 | ||||||||||||||
| Operating Income (Loss) | $ | 132,872 | $ | (5,372) | 127,500 | ||||||||||||
| Interest Income | 10,180 | ||||||||||||||||
| Interest Expense | (42,634) | ||||||||||||||||
| Other, net | (887) | ||||||||||||||||
| Income Before Income Tax | $ | 94,159 | |||||||||||||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 12, 2026 | Showing above |
| 2024 | Feb 12, 2025 | |
| 2023 | Feb 14, 2024 | |
| 2022 | Feb 15, 2023 | |
| 2021 | Feb 18, 2022 | |
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.