Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2016shares | |
Document And Entity Information [Abstract] | |
Entity Registrant Name | JETBLUE AIRWAYS CORP |
Entity Central Index Key | 1,158,463 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Large Accelerated Filer |
Document Type | 10-Q |
Document Period End Date | Mar. 31, 2016 |
Document Fiscal Year Focus | 2,016 |
Document Fiscal Period Focus | Q1 |
Amendment Flag | false |
Entity Common Stock, Shares Outstanding | 322,154,732 |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 757 | $ 318 |
Investment securities | 530 | 558 |
Receivables, less allowance (2016-$6; 2015-$6) | 145 | 136 |
Prepaid expenses and other | 342 | 361 |
Total current assets | 1,774 | 1,373 |
PROPERTY AND EQUIPMENT | ||
Flight equipment | 7,204 | 7,079 |
Predelivery deposits for flight equipment | 172 | 171 |
Flight Equipment, gross plus deposits | 7,376 | 7,250 |
Less accumulated depreciation | 1,637 | 1,573 |
Flight Equipment, Net | 5,739 | 5,677 |
Other property and equipment | 895 | 868 |
Less accumulated depreciation | 306 | 293 |
Property plant and equipment other net | 589 | 575 |
Assets constructed for others | 561 | 561 |
Less accumulated depreciation | 167 | 161 |
Asset constructed for others net | 394 | 400 |
Total property and equipment | 6,722 | 6,652 |
OTHER ASSETS | ||
Investment securities | 0 | 49 |
Restricted cash | 66 | 63 |
Other | 500 | 507 |
Total other assets | 566 | 619 |
TOTAL ASSETS | 9,062 | 8,644 |
CURRENT LIABILITIES | ||
Accounts payable | 260 | 205 |
Air traffic liability | 1,157 | 1,053 |
Accrued salaries, wages and benefits | 263 | 302 |
Other accrued liabilities | 346 | 267 |
Current maturities of long-term debt and capital leases | 448 | 448 |
Total current liabilities | 2,474 | 2,275 |
LONG-TERM DEBT AND CAPITAL LEASE OBLIGATIONS | 1,332 | 1,379 |
CONSTRUCTION OBLIGATION | 469 | 472 |
DEFERRED TAXES AND OTHER LIABILITIES | ||
Deferred income taxes | 1,276 | 1,218 |
Other | 97 | 90 |
Total deferred taxes and other liabilities | 1,373 | 1,308 |
STOCKHOLDERS’ EQUITY | ||
Preferred stock, $0.01 par value; 25 shares authorized, none issued | 0 | 0 |
Common stock, $0.01 par value; 900 shares authorized, 394 and 392 shares issued and 322 and 322 shares outstanding at March 31, 2016 and December 31, 2015, respectively | 4 | 4 |
Treasury stock, at cost; 72 and 70 shares at March 31, 2016 and December 31, 2015, respectively | (379) | (366) |
Additional paid-in capital | 1,914 | 1,896 |
Retained earnings | 1,878 | 1,679 |
Accumulated other comprehensive loss | (3) | (3) |
Total stockholders’ equity | 3,414 | 3,210 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 9,062 | $ 8,644 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts receivable | $ 6 | $ 6 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 25,000,000 | 25,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 900,000,000 | 900,000,000 |
Common stock, shares issued | 394,000,000 | 392,000,000 |
Common stock, shares, outstanding | 322,000,000 | 322,000,000 |
Treasury stock, shares | 72,000,000 | 70,000,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
OPERATING REVENUES | ||
Passenger | $ 1,478 | $ 1,408 |
Other | 138 | 115 |
Total operating revenues | 1,616 | 1,523 |
OPERATING EXPENSES | ||
Aircraft fuel and related taxes | 215 | 335 |
Salaries, wages and benefits | 435 | 375 |
Landing fees and other rents | 85 | 83 |
Depreciation and amortization | 91 | 87 |
Aircraft rent | 28 | 31 |
Sales and marketing | 64 | 60 |
Maintenance materials and repairs | 135 | 113 |
Other operating expenses | 214 | 186 |
Total operating expenses | 1,267 | 1,270 |
OPERATING INCOME | 349 | 253 |
OTHER INCOME (EXPENSE) | ||
Interest expense | (29) | (34) |
Capitalized interest | 2 | 2 |
Interest income and other | 1 | 1 |
Total other income (expense) | (26) | (31) |
INCOME BEFORE TAXES | 323 | 222 |
Income tax expense | 124 | 85 |
NET INCOME | $ 199 | $ 137 |
EARNINGS PER COMMON SHARE: | ||
Earnings Per Share, Basic | $ 0.62 | $ 0.44 |
Earnings Per Share, Diluted | $ 0.59 | $ 0.40 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Comprehensive Income [Abstract] | ||
NET INCOME | $ 199 | $ 137 |
Changes in fair value of derivative instruments, net of reclassifications into earnings (net of $0 and $8 of taxes in 2016 and 2015, respectively) | 0 | 13 |
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent | 0 | 8 |
Total other comprehensive income | 0 | 13 |
COMPREHENSIVE INCOME | $ 199 | $ 150 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Statement of Cash Flows [Abstract] | ||
Net Income | $ 199 | $ 137 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Deferred income taxes | 57 | 62 |
Depreciation | 79 | 67 |
Amortization | 12 | 20 |
Stock-based compensation | 7 | 5 |
(Gains) losses on sale of assets | 0 | (9) |
Collateral returned for derivative instruments | 0 | 20 |
Changes in certain operating assets and liabilities | 230 | 224 |
Other, net | 1 | 2 |
Net cash provided by operating activities | 585 | 528 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Capital expenditures | (143) | (148) |
Predelivery deposits for flight equipment | (23) | (20) |
Purchase of held-to-maturity investments | 0 | (129) |
Proceeds from the maturities of held-to-maturity investments | 144 | 94 |
Purchase of available-for-sale securities | (118) | (55) |
Proceeds from the sale of available-for-sale securities | 50 | 20 |
Other, net | 0 | 1 |
Net cash used in investing activities | (90) | (237) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from issuance of common stock | 2 | 30 |
Proceeds from issuance of long-term debt | 0 | 0 |
Repayment of long-term debt and capital lease obligations | (51) | (55) |
Other, net | (7) | (8) |
Net cash used in financing activities | (56) | (33) |
INCREASE IN CASH AND CASH EQUIVALENTS | 439 | 258 |
Cash and cash equivalents at beginning of period | 318 | 341 |
Cash and cash equivalents at end of period | $ 757 | $ 599 |
Summary of Significant Accounti
Summary of Significant Accounting Policies (Notes) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation JetBlue Airways Corporation, or JetBlue, provides air transportation services across the United States, the Caribbean and Latin America. Our condensed consolidated financial statements include the accounts of JetBlue and our subsidiaries which are collectively referred to as “we” or the “Company”. All majority-owned subsidiaries are consolidated on a line by line basis, with all intercompany transactions and balances being eliminated. These condensed consolidated financial statements and related notes should be read in conjunction with our 2015 audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2015 , or our 2015 Form 10-K. These condensed consolidated financial statements are unaudited and have been prepared by us following the rules and regulations of the Securities and Exchange Commission, or the SEC. In our opinion they reflect all adjustments, including normal recurring items, that are necessary to present fairly the results for interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the U.S., or GAAP, have been condensed or omitted as permitted by such rules and regulations; however, we believe that the disclosures are adequate to make the information presented not misleading. Operating results for the periods presented herein are not necessarily indicative of the results that may be expected for other interim periods or the entire fiscal year. Investment securities Investment securities consist of available-for-sale investment securities and held-to-maturity investment securities. We use a specific identification method to determine the cost of the securities when they are sold. Held-to-maturity investment securities. The contractual maturities of the corporate bonds we held as of March 31, 2016 were not greater than 24 months. We did not record any significant gains or losses on these securities during the three months ended March 31, 2016 or 2015 . The estimated fair value of these investments approximated their carrying value as of March 31, 2016 and December 31, 2015 , respectively. The carrying values of investment securities consisted of the following at March 31, 2016 and December 31, 2015 (in millions): March 31, 2016 December 31, 2015 Available-for-sale securities Time deposits $ 125 $ 125 Commercial paper 58 55 Treasury bills 140 75 Total available-for-sale securities 323 255 Held-to-maturity securities Corporate bonds $ 177 $ 322 Treasury notes 30 30 Total held-to-maturity securities 207 352 Total investment securities $ 530 $ 607 Recent Accounting Pronouncements During the first quarter of 2016, we adopted Accounting Standards Update, or ASU, 2015-03, Interest - Imputation of Interest, Simplifying the Presentation of Debt Issuance Costs topic of the FASB Codification, or Codification. ASU 2015-03 provides a simplified presentation of debt issuance costs and requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. Upon adoption, the ASU requires retrospective application to all prior periods presented in the financial statements. The condensed consolidated balance sheet as of December 31, 2015 reflects retrospective application and includes our unamortized debt issuance costs of $16 million within long-term debt and capital lease obligations. Prior to adoption this amount was included within other long-term assets. Also during the first quarter of 2016, we adopted ASU 2015-05, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40), Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement topic of the Codification, which provides guidance to clarify the customer's accounting for fees paid in a cloud computing arrangement. Customers cloud computing arrangements which include a software license should account for the software license consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. We adopted ASU 2015-05 prospectively and do not expect the amendments to have a significant impact on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . Under ASU 2016-02, a lessee will recognize liabilities for lease payments and right-of-use assets representing its right to use the underlying asset for the lease term. While we are still evaluating the full impact of adopting the amendments on our consolidated financial statements and disclosures, we have determined that it will impact our accounting for aircraft and other leases. The amendments are effective for fiscal years beginning after December 15, 2018 and includes interim periods within those fiscal years. Early adoption is permitted, and companies are required to use a modified retrospective approach at the earliest period presented. The FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accountin g. The amendments apply to several aspects of accounting for stock-based compensation including the recognition of excess tax benefits and deficiencies and their related presentation in the statement of cash flows as well as accounting for forfeitures. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, including interim periods and allows for prospective, retrospective or modified retrospective adoption, depending on the area covered in the update, with early adoption permitted. We are currently determining the transition method and assessing the impact the amendments may have on our financial condition, results of operations or cash flows as a result of adopting this standard. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers topic of the Codification, which supersedes existing revenue recognition guidance. Under the ASU 2014-09, a company will recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled to in exchange for those goods or services. The amendments allow for either full retrospective or modified retrospective adoption. In July 2015, the FASB voted to defer the effective date of ASU 2014-09 by one year to interim and annual reporting periods beginning after December 15, 2017 and permitted early adoption, but not prior to December 15, 2016. While we are still evaluating the full impact of adopting the amendments on our consolidated financial statements and disclosures, we have determined that it will impact our loyalty program accounting. The amendments will no longer allow us to use the incremental cost method when recording the financial impact of TrueBlue ® points earned on JetBlue purchases and will require us to re-value our liability with a relative fair value approach. |
Long-term Debt and Short-term B
Long-term Debt and Short-term Borrowings (Notes) | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Long-term Debt, Short-term Borrowings, and Capital Lease Obligations | During the three months ended March 31, 2016 , we made scheduled principal payments of $51 million on our outstanding long-term debt and capital lease obligations. As a result of scheduled principal payments, two aircraft became unencumbered. Aircraft, engines, other equipment and facilities with a net book value of $2.9 billion at March 31, 2016 have been pledged as security under various loan agreements. As of March 31, 2016 , we owned, free of encumbrance, 46 Airbus A320 aircraft, 19 Airbus A321 aircraft and 33 spare engines. At March 31, 2016 , scheduled maturities of all of our long-term debt and capital lease obligations were $397 million for the remainder of 2016 , $185 million in 2017 , $193 million in 2018 , $215 million in 2019 , $179 million in 2020 and $611 million thereafter . The carrying amounts and estimated fair values of our long-term debt at March 31, 2016 and December 31, 2015 were as follows (in millions): March 31, 2016 December 31, 2015 Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Public Debt Floating rate enhanced equipment notes: Class G-1, due 2016 $ 15 $ 15 $ 16 $ 16 Class G-2, due 2016 185 184 185 184 Fixed rate special facility bonds, due through 2036 43 46 43 45 6.75% convertible debentures due in 2039 86 373 86 405 Non-Public Debt Fixed rate enhanced equipment notes, due through 2023 $ 195 $ 208 $ 201 $ 209 Floating rate equipment notes, due through 2025 187 189 193 195 Fixed rate equipment notes, due through 2026 933 1,035 964 1,042 Total (1) $ 1,644 $ 2,050 $ 1,688 $ 2,096 (1) Total excludes capital lease obligation of $150 million for March 31, 2016 and $155 million for December 31, 2015, and deferred financing costs of $14 million for March 31, 2016 and $16 million for December 31, 2015 The estimated fair values of our publicly held long-term debt are classified as Level 2 in the fair value hierarchy. The fair values of our enhanced equipment notes and our special facility bonds were based on quoted market prices in markets with low trading volumes. The fair value of our convertible debentures was based on other observable market inputs since they are not actively traded. The fair value of our non-public debt was estimated using a discounted cash flow analysis based on our borrowing rates for instruments with similar terms and therefore classified as Level 3 in the fair value hierarchy. The fair values of our other financial instruments approximate their carrying values. Refer to Note 7 for an explanation of the fair value hierarchy structure. We have financed certain aircraft with Enhanced Equipment Trust Certificates (EETCs) as one of the benefits of this structure is being able to finance several aircraft at one time, rather than individually. The structure of EETC financing is that we create pass-through trusts in order to issue pass-through certificates. The proceeds from the issuance of these certificates are then used to purchase equipment notes which are issued by us and are secured by our aircraft. These trusts meet the definition of a variable interest entity, or VIE, as defined in the Consolidations topic of the Codification, and must be considered for consolidation in our condensed consolidated financial statements. Our assessment of our EETCs considers both quantitative and qualitative factors including the purpose for which these trusts were established and the nature of the risks in each. The main purpose of the trust structure is to enhance the credit worthiness of our debt obligation through certain bankruptcy protection provisions, liquidity facilities and lower our total borrowing cost. We concluded that we are not the primary beneficiary in these trusts because our involvement in them is limited to principal and interest payments on the related notes, the trusts were not set up to pass along variability created by credit risk to us and the likelihood of our defaulting on the notes. Therefore, we have not consolidated these trusts in our condensed consolidated financial statements. |
Comprehensive Income (Notes)
Comprehensive Income (Notes) | 3 Months Ended |
Mar. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income | Accumulated Other Comprehensive Income (Loss) Comprehensive income (loss) includes changes in fair value of our aircraft fuel derivatives and interest rate swap agreements, which qualify for hedge accounting. A rollforward of the amounts included in the accumulated other comprehensive income (loss), net of taxes for the three months ended March 31, 2016 and March 31, 2015 are as follows (in millions): Aircraft Fuel Derivatives (1) Interest Rate Swaps (2) Total Balance of accumulated losses at December 31, 2015 $ (4 ) $ 1 $ (3 ) Reclassifications into earnings (net of $0 of taxes) — — — Change in fair value (net of $0 of taxes) — — — Balance of accumulated losses at March 31, 2016 $ (4 ) $ 1 $ (3 ) Balance of accumulated losses at December 31, 2014 $ (63 ) $ — $ (63 ) Reclassifications into earnings (net of $13 of taxes) 22 — 22 Change in fair value (net of $(5) of taxes) (9 ) — (9 ) Balance of accumulated losses at March 31, 2015 $ (50 ) $ — $ (50 ) (1) Reclassified to aircraft fuel expense (2) Reclassified to interest expense |
Earnings Per Share (Notes)
Earnings Per Share (Notes) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table shows how we computed basic and diluted earnings per common share (in millions): Three Months Ended March 31, 2016 2015 Numerator: Net Income $ 199 $ 137 Effect of dilutive securities Interest on convertible debt, net of income taxes and profit sharing 1 1 Net income applicable to common stockholders after assumed conversions for diluted earnings per share $ 200 $ 138 Denominator: Weighted average shares outstanding 321.6 310.2 Effect of dilutive securities: Employee stock options, restricted stock units and stock purchase plan 2.3 3.2 Convertible debt 17.6 32.8 Adjusted weighted average shares outstanding and assumed conversions for diluted earnings per share 341.5 346.2 owing table shows how we computed basic and diluted earnings per common share (in millions): Three Months Ended March 31, 2016 2015 Numerator: Net Income $ 199 $ 137 Effect of dilutive securities Interest on convertible debt, net of income taxes and profit sharing 1 1 Net income applicable to common stockholders after assumed conversions for diluted earnings per share $ 200 $ 138 Denominator: Weighted average shares outstanding 321.6 310.2 Effect of dilutive securities: Employee stock options, restricted stock units and stock purchase plan 2.3 3.2 Convertible debt 17.6 32.8 Adjusted weighted average shares outstanding and assumed conversions for diluted earnings per share 341.5 346.2 During the three months ended March 31, 2016 and 2015 there were no shares excluded from EPS upon assumed conversion of our convertible debt. |
Employee Retirement Plan (Notes
Employee Retirement Plan (Notes) | 3 Months Ended |
Mar. 31, 2016 | |
Compensation and Retirement Disclosure [Abstract] | |
Compensation and Employee Benefit Plans [Text Block] | Crewmember Retirement Plan and Profit Sharing We sponsor a retirement savings 401(k) defined contribution plan, or the Plan, covering all of our employees, who we refer to as Crewmembers, where we match 100% of our Crewmembers' contributions up to 5% of their eligible wages. The contributions vest over five years and are measured from a Crewmember's hire date. Crewmembers are immediately vested in their voluntary contributions. Another component of the Plan is a Company discretionary contribution of 5% of eligible non-management Crewmember compensation, which we refer to as Retirement Plus. Retirement Plus contributions vest over three years and are measured from a Crewmember's hire date. Our non-management Crewmembers are also eligible to receive profit sharing, calculated as 15% of adjusted pre-tax income before profit sharing and special items with the result reduced by Retirement Plus contributions. Eligible non-management employees may elect to have their profit sharing contributed directly to the Plan. Certain Federal Aviation Administration, or FAA-licensed Crewmembers, receive an additional contribution of 3% of eligible compensation, which we refer to as Retirement Advantage. Total 401(k) company match, Retirement Plus, profit sharing and Retirement Advantage expensed for the three months ended March 31, 2016 and 2015 was $81 million and $53 million , respectively. |
Commitments and Contingencies (
Commitments and Contingencies (Notes) | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | Commitments and Contingencies Flight Equipment Commitments As of March 31, 2016 , our firm aircraft orders consisted of 19 Airbus A321 aircraft, 25 Airbus A320 new engine option (A320neo) aircraft, 45 Airbus A321neo aircraft, 24 EMBRAER 190 aircraft and 10 spare engines scheduled for delivery through 2023 . Committed expenditures for these aircraft and related flight equipment, including estimated amounts for contractual price escalations and predelivery deposits, will be approximately $523 million for the remainder of 2016 , $801 million in 2017 , $674 million in 2018 , $1.0 billion in 2019 , $1.4 billion in 2020 and $2.4 billion thereafter. We are scheduled to receive eight new Airbus A321 aircraft during the remainder of 2016. Other Commitments As part of the 2014 sale of LiveTV, LLC, or LiveTV, formerly a wholly owned subsidiary of JetBlue, a $3 million liability relating to Airfone, a former subsidiary of LiveTV, was assigned to JetBlue under the purchase agreement. Separately, prior to the sale of LiveTV, JetBlue had an agreement with ViaSat Inc. through 2020 relating to in-flight broadband connectivity technology on our aircraft. That agreement stipulated a $20 million minimum commitment for the connectivity service and a $25 million minimum commitment for the related hardware and software purchases. As part of the sale of LiveTV, these commitments to ViaSat Inc. were assigned to LiveTV and JetBlue entered into two new service agreements with LiveTV pursuant to which LiveTV will provide in-flight entertainment and connectivity services to JetBlue for a minimum of seven years. As of March 31, 2016 , we had approximately $33 million in assets serving as collateral for letters of credit relating to a certain number of our leases. These are included in restricted cash and expire at the end of the related lease terms. Additionally, we had approximately $26 million pledged related to our workers compensation insurance policies and other business partner agreements which will expire according to the terms of the related policies or agreements. Legal Matters Occasionally we are involved in various claims, lawsuits, regulatory examinations, investigations and other legal matters arising, for the most part, in the ordinary course of business. The outcome of litigation and other legal matters is always uncertain. The Company believes it has valid defenses to the legal matters currently pending against it, is defending itself vigorously and has recorded accruals determined in accordance with GAAP, where appropriate. In making a determination regarding accruals, using available information, we evaluate the likelihood of an unfavorable outcome in legal or regulatory proceedings to which we are a party and record a loss contingency when it is probable a liability has been incurred and the amount of the loss can be reasonably estimated. These subjective determinations are based on the status of such legal or regulatory proceedings, the merits of our defenses and consultation with legal counsel. Actual outcomes of these legal and regulatory proceedings may materially differ from our current estimates. It is possible that resolution of one or more of the legal matters currently pending or threatened could result in losses material to our consolidated results of operations, liquidity or financial condition. To date, none of these types of litigation matters, most of which are typically covered by insurance, has had a material impact on our operations or financial condition. We have insured and continue to insure against most of these types of claims. A judgment on any claim not covered by, or in excess of, our insurance coverage could materially adversely affect our financial condition or results of operations. |
Financial Derivative Instrument
Financial Derivative Instruments and Risk Management (Notes) | 3 Months Ended |
Mar. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Derivative Instruments and Risk Management | Financial Derivative Instruments and Risk Management As part of our risk management techniques, we periodically purchase over the counter energy derivative instruments and enter into fixed forward price agreements, or FFPs, to manage our exposure to the effect of changes in the price of aircraft fuel. Prices for the underlying commodities have historically been highly correlated to aircraft fuel, making derivatives of them effective at providing short-term protection against sharp increases in average fuel prices. We also periodically enter into jet fuel basis swaps for the differential between heating oil and jet fuel, to further limit the variability in fuel prices at various locations. To manage the variability of the cash flows associated with our variable rate debt, we have also entered into interest rate swaps. We do not hold or issue any derivative financial instruments for trading purposes. Aircraft fuel derivatives We attempt to obtain cash flow hedge accounting treatment for each aircraft fuel derivative that we enter into. This treatment is provided for under the Derivatives and Hedging topic of the Codification which allows for gains and losses on the effective portion of qualifying hedges to be deferred until the underlying planned jet fuel consumption occurs, rather than recognizing the gains and losses on these instruments into earnings during each period they are outstanding. The effective portion of realized aircraft fuel hedging derivative gains and losses is recognized in aircraft fuel expense in the period during which the underlying fuel is consumed. Ineffectiveness occurs, in certain circumstances, when the change in the total fair value of the derivative instrument differs from the change in the value of our expected future cash outlays for the purchase of aircraft fuel. Ineffectiveness is recognized immediately in interest income and other. If a hedge does not qualify for hedge accounting, the periodic changes in its fair value are also recognized in interest income and other. When aircraft fuel is consumed and the related derivative contract settles, any gain or loss previously recorded in other comprehensive income is recognized in aircraft fuel expense. All cash flows related to our fuel hedging derivatives are classified as operating cash flows. Our current approach to fuel hedging is to enter into hedges on a discretionary basis without a specific target of hedge percentage needs. We view our hedge portfolio as a form of insurance to help mitigate the impact of price volatility and protect us against severe spikes in oil prices, when possible. The following table illustrates the approximate hedged percentages of our projected fuel usage by quarter as of March 31, 2016 related to our outstanding fuel hedging contracts that were designated as cash flow hedges for accounting purposes. Jet fuel swap Jet fuel collar agreements Heating oil collar agreements Total Second Quarter 2016 — % — % — % — % Third Quarter 2016 (1) 10 % — % — % 10 % Fourth Quarter 2016 (1) 10 % — % — % 10 % (1) During April 2016, we entered into additional fuel hedges which increased our approximate hedge percentages for the third and fourth quarters of 2016 to 20% . Also during April 2016, we entered into fuel hedges to hedge approximately 5% of our 2017 projected fuel requirements. Interest rate swaps The interest rate hedges we had outstanding as of March 31, 2016 effectively swap floating rate debt for fixed rate debt. They take advantage of lower borrowing rates in existence at the time of the hedge transaction as compared to the date our original debt instruments were executed. As of March 31, 2016 , we had $15 million in notional debt outstanding related to these swaps, which cover certain interest payments through August 2016. The notional amount decreases over time to match scheduled repayments of the related debt. All of our outstanding interest rate swap contracts qualify as cash flow hedges in accordance with the Derivatives and Hedging topic of the Codification. Since all of the critical terms of our swap agreements match the debt to which they pertain, there was no ineffectiveness relating to these interest rate swaps in 2016 or 2015 . All related unrealized losses were deferred in accumulated other comprehensive loss. We did not recognize any material additional interest expense in the three months ended March 31, 2016 or 2015 . The table below reflects quantitative information related to our derivative instruments and where these amounts are recorded in our financial statements (dollar amounts in millions): March 31, December 31, Fuel derivatives Liability fair value recorded in other accrued liabilities (1) 5 5 Longest remaining term (months) 9 12 Hedged volume (barrels, in thousands) 900 900 Estimated amount of existing losses expected to be reclassified into earnings in the next 12 months 5 4 Interest rate derivatives Liability fair value recorded in other long term liabilities (2) — — Estimated amount of existing losses expected to be reclassified into earnings in the next 12 months — — Three Months Ended March 31, 2016 2015 Fuel derivatives Hedge effectiveness losses recognized in aircraft fuel expense $ — $ (35 ) Gains on derivatives not qualifying for hedge accounting recognized in other expense — 1 Hedge losses on derivatives recognized in comprehensive income — (14 ) Percentage of actual consumption economically hedged — 21 % Interest rate derivatives Hedge losses on derivatives recognized in interest expense $ — $ — Hedge gains on derivatives recognized in comprehensive income — — (1) Gross liability of each contract prior to consideration of offsetting positions with each counterparty and prior to the impact of collateral paid (2) Gross liability, prior to impact of collateral posted Any outstanding derivative instrument exposes us to credit loss in connection with our fuel contracts in the event of nonperformance by the counterparties to our agreements, but we do not expect that any of our counterparties will fail to meet their obligations. The amount of such credit exposure is generally the fair value of our outstanding contracts for which we are in a receivable position. To manage credit risks we select counterparties based on credit assessments, limit our overall exposure to any single counterparty and monitor the market position with each counterparty. Some of our agreements require cash deposits from either JetBlue or our counterparty if market risk exposure exceeds a specified threshold amount. We have master netting arrangements with our counterparties allowing us the right of offset to mitigate credit risk in derivative transactions. The financial derivative instrument agreements we have with our counterparties may require us to fund all, or a portion of, outstanding loss positions related to these contracts prior to their scheduled maturities. The amount of collateral posted, if any, is periodically adjusted based on the fair value of the hedge contracts. Our policy is to offset the liabilities represented by these contracts with any cash collateral paid to the counterparties. The impact of offsetting derivative instruments is depicted below (in millions): Gross Amount of Recognized Gross Amount of Cash Collateral Net Amount Presented on Balance Sheet Assets Liabilities Offset Assets Liabilities As of March 31, 2016 Fuel derivatives $ — $ 5 $ — $ — $ 5 Interest rate derivatives — — — — — As of December 31, 2015 Fuel derivatives $ — $ 5 $ — $ — $ 5 Interest rate derivatives — — — — — |
Fair Value of Financial Instrum
Fair Value of Financial Instruments (Notes) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value Under the Fair Value Measurements and Disclosures topic of the Codification, disclosures are required about how fair value is determined for assets and liabilities and a hierarchy for which these assets and liabilities must be grouped is established, based on significant levels of inputs as follows: Level 1 quoted prices in active markets for identical assets or liabilities; Level 2 quoted prices in active markets for similar assets and liabilities and inputs that are observable for the asset or liability; or Level 3 unobservable inputs for the asset or liability, such as discounted cash flow models or valuations. The determination of where assets and liabilities fall within this hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The following is a listing of our assets and liabilities required to be measured at fair value on a recurring basis and where they are classified within the fair value hierarchy as of March 31, 2016 and December 31, 2015 (in millions): March 31, 2016 Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 638 $ — $ — $ 638 Available-for-sale investment securities 140 183 — 323 $ 778 $ 183 $ — $ 961 Liabilities Aircraft fuel derivatives $ — $ 5 $ — $ 5 Interest rate swaps — — — — $ — $ 5 $ — $ 5 December 31, 2015 Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 147 $ — $ — $ 147 Available-for-sale investment securities 75 180 — 255 $ 222 $ 180 $ — $ 402 Liabilities Aircraft fuel derivatives $ — $ 5 $ — $ 5 Interest rate swaps — — — — $ — $ 5 $ — $ 5 Refer to Note 2 for fair value information related to our outstanding debt obligations as of March 31, 2016 and December 31, 2015 . Cash equivalents Our cash equivalents include money market securities and commercial paper which are readily convertible into cash, have maturities of 90 days or less when purchased and are considered to be highly liquid and easily tradable. These securities are valued using inputs observable in active markets for identical securities and are therefore classified as Level 1 within our fair value hierarchy. Available-for-sale investment securities Included in our available-for-sale investment securities are time deposits and commercial paper with maturities greater than 90 days but less than one year. The fair values of these instruments are based on observable inputs in non-active markets and are therefore classified as Level 2 in the hierarchy. We did not record any significant gains or losses on these securities during the three months ended March 31, 2016 and 2015 . Aircraft fuel derivatives Our aircraft fuel derivatives include swaps, collars, and basis swaps which are not traded on public exchanges. Heating oil and jet fuel are the products underlying these hedge contracts as they are highly correlated with the price of jet fuel. Their fair values are determined using a market approach based on inputs that are readily available from public markets for commodities and energy trading activities. Therefore, they are classified as Level 2 inputs. The data inputs are combined into quantitative models and processes to generate forward curves and volatilities related to the specific terms of the underlying hedge contracts. Interest rate swaps The fair values of our interest rate swaps are based on inputs received from the related counterparty, which are based on observable inputs for active swap indications in quoted markets for similar terms. The fair values of these instruments are based on observable inputs in non-active markets and are therefore classified as Level 2 in the hierarchy. |
Summary of Significant Accoun15
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Derivatives, Policy [Policy Text Block] | Aircraft fuel derivatives Our aircraft fuel derivatives include swaps, collars, and basis swaps which are not traded on public exchanges. Heating oil and jet fuel are the products underlying these hedge contracts as they are highly correlated with the price of jet fuel. Their fair values are determined using a market approach based on inputs that are readily available from public markets for commodities and energy trading activities. Therefore, they are classified as Level 2 inputs. The data inputs are combined into quantitative models and processes to generate forward curves and volatilities related to the specific terms of the underlying hedge contracts. Interest rate swaps The fair values of our interest rate swaps are based on inputs received from the related counterparty, which are based on observable inputs for active swap indications in quoted markets for similar terms. The fair values of these instruments are based on observable inputs in non-active markets and are therefore classified as Level 2 in the hierarchy. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash equivalents Our cash equivalents include money market securities and commercial paper which are readily convertible into cash, have maturities of 90 days or less when purchased and are considered to be highly liquid and easily tradable. These securities are valued using inputs observable in active markets for identical securities and are therefore classified as Level 1 within our fair value hierarchy. |
Basis of presentation | Basis of Presentation JetBlue Airways Corporation, or JetBlue, provides air transportation services across the United States, the Caribbean and Latin America. Our condensed consolidated financial statements include the accounts of JetBlue and our subsidiaries which are collectively referred to as “we” or the “Company”. All majority-owned subsidiaries are consolidated on a line by line basis, with all intercompany transactions and balances being eliminated. These condensed consolidated financial statements and related notes should be read in conjunction with our 2015 audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2015 , or our 2015 Form 10-K. These condensed consolidated financial statements are unaudited and have been prepared by us following the rules and regulations of the Securities and Exchange Commission, or the SEC. In our opinion they reflect all adjustments, including normal recurring items, that are necessary to present fairly the results for interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the U.S., or GAAP, have been condensed or omitted as permitted by such rules and regulations; however, we believe that the disclosures are adequate to make the information presented not misleading. Operating results for the periods presented herein are not necessarily indicative of the results that may be expected for other interim periods or the entire fiscal year. |
Investment securities | Investment securities Investment securities consist of available-for-sale investment securities and held-to-maturity investment securities. We use a specific identification method to determine the cost of the securities when they are sold. |
Held-to-maturity investment securities | Held-to-maturity investment securities. The contractual maturities of the corporate bonds we held as of March 31, 2016 were not greater than 24 months. We did not record any significant gains or losses on these securities during the three months ended March 31, 2016 or 2015 . The estimated fair value of these investments approximated their carrying value as of March 31, 2016 and December 31, 2015 , respectively. |
New Accounting Pronouncements [Policy Text Block] | During the first quarter of 2016, we adopted Accounting Standards Update, or ASU, 2015-03, Interest - Imputation of Interest, Simplifying the Presentation of Debt Issuance Costs topic of the FASB Codification, or Codification. ASU 2015-03 provides a simplified presentation of debt issuance costs and requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. Upon adoption, the ASU requires retrospective application to all prior periods presented in the financial statements. The condensed consolidated balance sheet as of December 31, 2015 reflects retrospective application and includes our unamortized debt issuance costs of $16 million within long-term debt and capital lease obligations. Prior to adoption this amount was included within other long-term assets. Also during the first quarter of 2016, we adopted ASU 2015-05, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40), Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement topic of the Codification, which provides guidance to clarify the customer's accounting for fees paid in a cloud computing arrangement. Customers cloud computing arrangements which include a software license should account for the software license consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. We adopted ASU 2015-05 prospectively and do not expect the amendments to have a significant impact on our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . Under ASU 2016-02, a lessee will recognize liabilities for lease payments and right-of-use assets representing its right to use the underlying asset for the lease term. While we are still evaluating the full impact of adopting the amendments on our consolidated financial statements and disclosures, we have determined that it will impact our accounting for aircraft and other leases. The amendments are effective for fiscal years beginning after December 15, 2018 and includes interim periods within those fiscal years. Early adoption is permitted, and companies are required to use a modified retrospective approach at the earliest period presented. The FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accountin g. The amendments apply to several aspects of accounting for stock-based compensation including the recognition of excess tax benefits and deficiencies and their related presentation in the statement of cash flows as well as accounting for forfeitures. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, including interim periods and allows for prospective, retrospective or modified retrospective adoption, depending on the area covered in the update, with early adoption permitted. We are currently determining the transition method and assessing the impact the amendments may have on our financial condition, results of operations or cash flows as a result of adopting this standard. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers topic of the Codification, which supersedes existing revenue recognition guidance. Under the ASU 2014-09, a company will recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration to which the company expects to be entitled to in exchange for those goods or services. The amendments allow for either full retrospective or modified retrospective adoption. In July 2015, the FASB voted to defer the effective date of ASU 2014-09 by one year to interim and annual reporting periods beginning after December 15, 2017 and permitted early adoption, but not prior to December 15, 2016. While we are still evaluating the full impact of adopting the amendments on our consolidated financial statements and disclosures, we have determined that it will impact our loyalty program accounting. The amendments will no longer allow us to use the incremental cost method when recording the financial impact of TrueBlue ® points earned on JetBlue purchases and will require us to re-value our liability with a relative fair value approach. |
Marketable Securities, Available-for-sale Securities, Policy [Policy Text Block] | Available-for-sale investment securities Included in our available-for-sale investment securities are time deposits and commercial paper with maturities greater than 90 days but less than one year. The fair values of these instruments are based on observable inputs in non-active markets and are therefore classified as Level 2 in the hierarchy. We did not record any significant gains or losses on these securities during the three months ended March 31, 2016 and 2015 . |
Summary of Significant Accoun16
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Schedule of marketable securities | The carrying values of investment securities consisted of the following at March 31, 2016 and December 31, 2015 (in millions): March 31, 2016 December 31, 2015 Available-for-sale securities Time deposits $ 125 $ 125 Commercial paper 58 55 Treasury bills 140 75 Total available-for-sale securities 323 255 Held-to-maturity securities Corporate bonds $ 177 $ 322 Treasury notes 30 30 Total held-to-maturity securities 207 352 Total investment securities $ 530 $ 607 |
Long-term Debt and Short-term17
Long-term Debt and Short-term Borrowings (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Long Term Debt | The carrying amounts and estimated fair values of our long-term debt at March 31, 2016 and December 31, 2015 were as follows (in millions): March 31, 2016 December 31, 2015 Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Public Debt Floating rate enhanced equipment notes: Class G-1, due 2016 $ 15 $ 15 $ 16 $ 16 Class G-2, due 2016 185 184 185 184 Fixed rate special facility bonds, due through 2036 43 46 43 45 6.75% convertible debentures due in 2039 86 373 86 405 Non-Public Debt Fixed rate enhanced equipment notes, due through 2023 $ 195 $ 208 $ 201 $ 209 Floating rate equipment notes, due through 2025 187 189 193 195 Fixed rate equipment notes, due through 2026 933 1,035 964 1,042 Total (1) $ 1,644 $ 2,050 $ 1,688 $ 2,096 |
Comprehensive Income (Tables)
Comprehensive Income (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income (Loss), Net of Tax | A rollforward of the amounts included in the accumulated other comprehensive income (loss), net of taxes for the three months ended March 31, 2016 and March 31, 2015 are as follows (in millions): Aircraft Fuel Derivatives (1) Interest Rate Swaps (2) Total Balance of accumulated losses at December 31, 2015 $ (4 ) $ 1 $ (3 ) Reclassifications into earnings (net of $0 of taxes) — — — Change in fair value (net of $0 of taxes) — — — Balance of accumulated losses at March 31, 2016 $ (4 ) $ 1 $ (3 ) Balance of accumulated losses at December 31, 2014 $ (63 ) $ — $ (63 ) Reclassifications into earnings (net of $13 of taxes) 22 — 22 Change in fair value (net of $(5) of taxes) (9 ) — (9 ) Balance of accumulated losses at March 31, 2015 $ (50 ) $ — $ (50 ) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table shows how we computed basic and diluted earnings per common share (in millions): Three Months Ended March 31, 2016 2015 Numerator: Net Income $ 199 $ 137 Effect of dilutive securities Interest on convertible debt, net of income taxes and profit sharing 1 1 Net income applicable to common stockholders after assumed conversions for diluted earnings per share $ 200 $ 138 Denominator: Weighted average shares outstanding 321.6 310.2 Effect of dilutive securities: Employee stock options, restricted stock units and stock purchase plan 2.3 3.2 Convertible debt 17.6 32.8 Adjusted weighted average shares outstanding and assumed conversions for diluted earnings per share 341.5 346.2 owing table shows how we computed basic and diluted earnings per common share (in millions): Three Months Ended March 31, 2016 2015 Numerator: Net Income $ 199 $ 137 Effect of dilutive securities Interest on convertible debt, net of income taxes and profit sharing 1 1 Net income applicable to common stockholders after assumed conversions for diluted earnings per share $ 200 $ 138 Denominator: Weighted average shares outstanding 321.6 310.2 Effect of dilutive securities: Employee stock options, restricted stock units and stock purchase plan 2.3 3.2 Convertible debt 17.6 32.8 Adjusted weighted average shares outstanding and assumed conversions for diluted earnings per share 341.5 346.2 During the three months ended March 31, 2016 and 2015 there were no shares excluded from EPS upon assumed conversion of our convertible debt. |
Financial Derivative Instrume20
Financial Derivative Instruments and Risk Management (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Percentage fuel covered under derivative contracts | The following table illustrates the approximate hedged percentages of our projected fuel usage by quarter as of March 31, 2016 related to our outstanding fuel hedging contracts that were designated as cash flow hedges for accounting purposes. Jet fuel swap Jet fuel collar agreements Heating oil collar agreements Total Second Quarter 2016 — % — % — % — % Third Quarter 2016 (1) 10 % — % — % 10 % Fourth Quarter 2016 (1) 10 % — % — % 10 % |
Derivative instrument in statement of financial position and financial performance | The table below reflects quantitative information related to our derivative instruments and where these amounts are recorded in our financial statements (dollar amounts in millions): March 31, December 31, Fuel derivatives Liability fair value recorded in other accrued liabilities (1) 5 5 Longest remaining term (months) 9 12 Hedged volume (barrels, in thousands) 900 900 Estimated amount of existing losses expected to be reclassified into earnings in the next 12 months 5 4 Interest rate derivatives Liability fair value recorded in other long term liabilities (2) — — Estimated amount of existing losses expected to be reclassified into earnings in the next 12 months — — Three Months Ended March 31, 2016 2015 Fuel derivatives Hedge effectiveness losses recognized in aircraft fuel expense $ — $ (35 ) Gains on derivatives not qualifying for hedge accounting recognized in other expense — 1 Hedge losses on derivatives recognized in comprehensive income — (14 ) Percentage of actual consumption economically hedged — 21 % Interest rate derivatives Hedge losses on derivatives recognized in interest expense $ — $ — Hedge gains on derivatives recognized in comprehensive income — — (1) Gross liability of each contract prior to consideration of offsetting positions with each counterparty and prior to the impact of collateral paid (2) Gross liability, prior to impact of collateral posted |
Offsetting assets and liabilities | The impact of offsetting derivative instruments is depicted below (in millions): Gross Amount of Recognized Gross Amount of Cash Collateral Net Amount Presented on Balance Sheet Assets Liabilities Offset Assets Liabilities As of March 31, 2016 Fuel derivatives $ — $ 5 $ — $ — $ 5 Interest rate derivatives — — — — — As of December 31, 2015 Fuel derivatives $ — $ 5 $ — $ — $ 5 Interest rate derivatives — — — — — |
Fair Value of Financial Instr21
Fair Value of Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair value, by balance sheet grouping | The following is a listing of our assets and liabilities required to be measured at fair value on a recurring basis and where they are classified within the fair value hierarchy as of March 31, 2016 and December 31, 2015 (in millions): March 31, 2016 Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 638 $ — $ — $ 638 Available-for-sale investment securities 140 183 — 323 $ 778 $ 183 $ — $ 961 Liabilities Aircraft fuel derivatives $ — $ 5 $ — $ 5 Interest rate swaps — — — — $ — $ 5 $ — $ 5 December 31, 2015 Level 1 Level 2 Level 3 Total Assets Cash equivalents $ 147 $ — $ — $ 147 Available-for-sale investment securities 75 180 — 255 $ 222 $ 180 $ — $ 402 Liabilities Aircraft fuel derivatives $ — $ 5 $ — $ 5 Interest rate swaps — — — — $ — $ 5 $ — $ 5 |
Summary of Significant Accoun22
Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | |||
Deferred Costs | $ 14 | $ 16 | |
Available-for-sale securities | |||
Available-for-sale investment securities | 323 | 255 | |
Held-to-maturity securities | |||
Held-to-maturity securities | 207 | 352 | |
Marketable securities | 530 | $ 607 | |
Bank Time Deposits [Member] | |||
Available-for-sale securities | |||
Available-for-sale investment securities | 125 | 125 | |
Held-to-maturity securities | |||
Held-to-maturity securities | 177 | 322 | |
Commercial paper [Member] | |||
Available-for-sale securities | |||
Available-for-sale investment securities | 58 | 55 | |
US Treasury Bill Securities [Member] | |||
Available-for-sale securities | |||
Available-for-sale investment securities | 140 | 75 | |
Corporate bonds [Member] | |||
Held-to-maturity securities | |||
Held-to-maturity securities | $ 30 | $ 30 |
Summary of Significant Accoun23
Summary of Significant Accounting Policies Held-to-Maturity Gains (Loss) (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2016USD ($) | |
Investments, Debt and Equity Securities [Abstract] | |
Held-to-maturity Securities, Gross Gains (Losses), Derivatives | $ 0 |
Long-term Debt and Short-term24
Long-term Debt and Short-term Borrowings (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2016USD ($)aircraft | Dec. 31, 2015USD ($) | |
Debt Instrument [Line Items] | ||
Reduction in outstanding debt and capital lease obligations | $ 51 | |
Aircraft unencumbered due to regularly scheduled payments | aircraft | 2 | |
Value of aircraft, engines and other equipment and facilities which were pledged as security under various loan agreements | $ 2,900 | |
Unencumbered spare engine | aircraft | 33 | |
Long-term Debt, Maturities, Repayments of Principal, Remainder of Fiscal Year | $ 397 | |
Long-term debt, maturities, repayments of principal in Year Two | 185 | |
Long-term debt, maturities, repayments of principal in Year Three | 193 | |
Long-term debt, maturities, repayments of principal in Year Four | 215 | |
Long-term debt, maturities, repayments of principal in Year Five | 179 | |
Long-term debt, maturities, repayments of principal after Year Five | 611 | |
Deferred Costs | 14 | $ 16 |
Capital Lease Obligations | 150 | 155 |
Carrying amounts and estimated fair values of long-term debt | ||
Carrying Value, Total | 1,644 | 1,688 |
Estimated Fair Value, Total | 2,050 | 2,096 |
Public Debt Floating Rate Class G One Due Two Thousand Sixteen [Member] | ||
Carrying amounts and estimated fair values of long-term debt | ||
Carrying Value, Total | 15 | 16 |
Estimated Fair Value, Total | 15 | 16 |
Public Debt Floating Rate Class G Two Due Two Thousand Sixteen [Member] | ||
Carrying amounts and estimated fair values of long-term debt | ||
Carrying Value, Total | 185 | 185 |
Estimated Fair Value, Total | 184 | 184 |
Public Debt Fixed Rate Special Facility Bonds Due Through Two Thousand Thirty Six [Member] | ||
Carrying amounts and estimated fair values of long-term debt | ||
Carrying Value, Total | 43 | 43 |
Estimated Fair Value, Total | 46 | 45 |
Public Debt Six Point Seven Five Percentage Convertible Debentures Due In Two Thousand Thirty Nine [Member] | ||
Carrying amounts and estimated fair values of long-term debt | ||
Carrying Value, Total | 86 | 86 |
Estimated Fair Value, Total | 373 | 405 |
Non Public Debt Fixed Rate Enhanced Equipment Notes Due Through Two Thousand And Twenty Three [Member] | ||
Carrying amounts and estimated fair values of long-term debt | ||
Carrying Value, Total | 195 | 201 |
Estimated Fair Value, Total | 208 | 209 |
Non Public Debt Floating Rate Equipment Notes Due Through Two Thousand And Twenty Five [Member] | ||
Carrying amounts and estimated fair values of long-term debt | ||
Carrying Value, Total | 187 | 193 |
Estimated Fair Value, Total | 189 | 195 |
Non Public Debt Fixed Rate Equipment Notes Due Through Two Thousand Twenty Six [Member] | ||
Carrying amounts and estimated fair values of long-term debt | ||
Carrying Value, Total | 933 | 964 |
Estimated Fair Value, Total | $ 1,035 | $ 1,042 |
A-320-200 [Member] | ||
Debt Instrument [Line Items] | ||
unencumbered aircraft | aircraft | 46 | |
A-321 [Member] | ||
Debt Instrument [Line Items] | ||
unencumbered aircraft | aircraft | 19 |
Comprehensive Income (Details)
Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Beginning accumulated gains (losses) | $ (3) | $ (63) |
Reclassifications into earnings | 0 | 22 |
Change in fair value | 0 | (9) |
Ending accumulated losses | (3) | (50) |
Fuel Derivatives [Member] | ||
Accumulated Other Comprehensive Income Loss [Line Items] | ||
Beginning accumulated gains (losses) | (4) | (63) |
Reclassifications into earnings | 0 | 22 |
Change in fair value | 0 | (9) |
Ending accumulated losses | $ (4) | $ (50) |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | |
Derivative [Line Items] | ||||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax | $ 0 | $ 22 | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Net of Tax | 0 | (9) | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (3) | (50) | $ (3) | $ (63) |
Reclassifications into earnings, tax | 0 | 13 | ||
Change in fair value, tax | 0 | (5) | ||
Fuel Derivatives [Member] | ||||
Derivative [Line Items] | ||||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax | 0 | 22 | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Net of Tax | 0 | (9) | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | (4) | (50) | (4) | (63) |
Interest Rate Swap [Member] | ||||
Derivative [Line Items] | ||||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax | 0 | 0 | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Net of Tax | 0 | 0 | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | $ 1 | $ 0 | $ 1 | $ 0 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Numerator: | ||
Net Income | $ 199 | $ 137 |
Effect of dilutive securities | ||
Interest on convertible debt, net of income taxes and profit sharing | 1 | 1 |
Net income applicable to common stockholders after assumed conversions for diluted earnings per share | $ 200 | $ 138 |
Denominator: | ||
Weighted average shares outstanding | 321,600,000 | 310,200,000 |
Effect of dilutive securities: | ||
Employee stock options, restricted stock units and stock purchase plan | 2,300,000 | 3,200,000 |
Convertible debt | 17,600,000 | 32,800,000 |
Adjusted weighted average shares outstanding and assumed conversions for diluted earnings per share | 341,500,000 | 346,200,000 |
Shares excluded from EPS calculation (in millions): | ||
Shares issuable upon exercise of outstanding stock options or vesting of restricted stock units as assumed exercise would be antidilutive | 0 | 0 |
Employee Retirement Plan (Detai
Employee Retirement Plan (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Compensation and Retirement Disclosure [Abstract] | ||
Defined Contribution Plan, Employer Matching Contribution, Percent of Match | 100.00% | |
Employee Retirement Plan (Textuals) [Abstract] | ||
Percentage of employees' gross pay for which the employer contributes a matching contribution to the Plan. | 5.00% | |
Percentage of employees' gross pay for which the employer can contribute a discretionary profit sharing contribution to the Plan. | 5.00% | |
Percentage of Its Eligible Pre Tax Profits for which the employer contributes to the Plan. | 15.00% | |
Percentage of FAA licensed employees gross pay for which ER can contribute discretionary profit sharing contribution to plan | 3.00% | |
Contribution to employee retirement plan | $ 81 | $ 53 |
Commitments and Contingencies29
Commitments and Contingencies (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2016USD ($)aircraft | Jun. 10, 2014USD ($) | |
Unrecorded Unconditional Purchase Obligation [Line Items] | ||
Unrecorded Unconditional Purchase Obligation, Due in Remainder of Fiscal Year | $ 523 | |
Unrecorded Unconditional Purchase Obligation, Due within Two Years | 801 | |
Unrecorded Unconditional Purchase Obligation, Due within Three Years | 674 | |
Unrecorded Unconditional Purchase Obligation, Due within Four Years | 1,000 | |
Unrecorded Unconditional Purchase Obligation, Due within Five Years | 1,400 | |
Unrecorded Unconditional Purchase Obligation, Due after Five Years | 2,400 | |
Loss Contingency Accrual | $ 3 | |
Restricted assets pledged under letter of credit | 33 | |
Restricted Assets Pledged Related To Workers Compensation Insurance Policies And Other Business Partner Agreements | $ 26 | |
A-321 [Member] | ||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||
Unrecorded Unconditional Purchase Obligations Disclosure | aircraft | 19 | |
Number Of Aircraft Scheduled To Receive | aircraft | 8 | |
A-320-Neo [Member] | ||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||
Unrecorded Unconditional Purchase Obligations Disclosure | aircraft | 25 | |
A-321 Neo [Member] | ||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||
Unrecorded Unconditional Purchase Obligations Disclosure | aircraft | 45 | |
E-190 [Member] | ||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||
Unrecorded Unconditional Purchase Obligations Disclosure | aircraft | 24 | |
Spare Engines [Member] | ||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||
Unrecorded Unconditional Purchase Obligations Disclosure | aircraft | 10 | |
In Flight Entertainment Systems Member | ||
Unrecorded Unconditional Purchase Obligation [Line Items] | ||
Unrecorded Unconditional Purchase Obligations, Term | 7 years |
Commitments and Contingencies
Commitments and Contingencies - Loss Contingencies (Details) $ in Millions | 5 Months Ended |
Jun. 10, 2014USD ($) | |
Loss Contingencies [Line Items] | |
Loss Contingency Accrual | $ 3 |
Hardware and Software Purchases [Member] | |
Loss Contingencies [Line Items] | |
Long-term Purchase Commitment, Amount | 25 |
Connectivity Service [Member] | |
Loss Contingencies [Line Items] | |
Long-term Purchase Commitment, Amount | $ 20 |
Financial Derivative Instrume31
Financial Derivative Instruments and Risk Management (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2016 | Apr. 30, 2016 | |
Derivative [Line Items] | ||||
Percentage Fuel Hedged - Second Quarter Current Year | 0.00% | |||
Percentage Fuel Hedged - Third Quarter Current Year | 10.00% | |||
Percentage Fuel Hedged - Fourth Quarter Current Year | 10.00% | |||
Interest expense | $ (29,000,000) | $ (34,000,000) | ||
Interest Rate Swap [Member] | Cash Flow Hedging [Member] | Designated as Hedging Instrument [Member] | ||||
Derivative [Line Items] | ||||
Notional amount of interest rate cash flow hedge derivatives | 15,000,000 | |||
Other income (expense) [Member] | Interest Expense [Member] | ||||
Derivative [Line Items] | ||||
Gain (Loss) on Price Risk Derivatives, Net | $ 0 | $ 0 | ||
Fuel [Member] | Jet Fuel Swap Agreements [Member] | ||||
Derivative [Line Items] | ||||
Percentage Fuel Hedged - Second Quarter Current Year | 0.00% | |||
Percentage Fuel Hedged - Third Quarter Current Year | 10.00% | |||
Percentage Fuel Hedged - Fourth Quarter Current Year | 10.00% | |||
Fuel [Member] | Jet Fuel Collar Agreement [Member] | ||||
Derivative [Line Items] | ||||
Percentage Fuel Hedged - Second Quarter Current Year | 0.00% | |||
Percentage Fuel Hedged - Third Quarter Current Year | 0.00% | |||
Percentage Fuel Hedged - Fourth Quarter Current Year | 0.00% | |||
Heating Oil [Member] | Heating Oil Collar Agreement [Member] | ||||
Derivative [Line Items] | ||||
Percentage Fuel Hedged - Second Quarter Current Year | 0.00% | |||
Percentage Fuel Hedged - Third Quarter Current Year | 0.00% | |||
Percentage Fuel Hedged - Fourth Quarter Current Year | 0.00% | |||
Subsequent Event [Member] | ||||
Derivative [Line Items] | ||||
Percentage Fuel Hedged - Third Quarter Current Year - Subsequent to Period End | 20.00% | |||
Percentage Fuel Hedged after period end | 20.00% | |||
Percentage Fuel Hedged - Year Two - Subsequent to Period End | 5.00% |
Financial Derivative Instrume32
Financial Derivative Instruments and Risk Management (Details 2) bbl in Thousands, $ in Millions | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016USD ($)bbl | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($)bbl | |
Derivatives, Fair Value [Line Items] | |||
Hedged volume (barrels, in thousands) | $ 5 | $ 4 | |
Interest Expense | 29 | $ 34 | |
Interest rate derivatives [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Liability fair value recorded in other long term liabilities | 0 | 0 | |
Estimated amount of existing losses expected to be reclassified into earnings in the next 12 months | $ 0 | $ 0 | |
Fuel derivatives [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Maximum Length of Time Hedged in Price Risk Cash Flow Hedge | 9 months | 12 months | |
Liability fair value recorded in other accrued liabilities(1) | bbl | 900 | 900 | |
Other accrued liabilities [Member] | Fuel derivatives [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative Liability | $ 5 | $ 5 |
Financial Derivative Instrume33
Financial Derivative Instruments and Risk Management - Hedging Effectiveness (Details 3) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Other income (expense) [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net | $ 0 | $ 1 |
Fuel derivatives [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Percentage of actual consumption hedged | 0.00% | 21.00% |
Fuel derivatives [Member] | Aircraft Fuel Expense [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Hedge losses recognized | $ 0 | $ (35) |
Fuel derivatives [Member] | Comprehensive Income [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Percentage of actual consumption economically hedged | 0 | (14) |
Interest Rate Contract [Member] | Comprehensive Income [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Percentage of actual consumption economically hedged | 0 | 0 |
Interest Rate Contract [Member] | Interest Expense [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gain from Components Excluded from Assessment of Cash Flow Hedge Effectiveness | $ 0 | $ 0 |
Financial Derivative Instrume34
Financial Derivative Instruments and Risk Management (Details 4) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Fuel Derivatives [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset | $ 0 | $ 0 |
Derivative Liability, Fair Value, Gross Liability | 5 | 5 |
Derivative, Collateral, Right to Reclaim Cash | 0 | 0 |
Assets, net amount presented in balance sheet | 0 | 0 |
Liabilities, net amount presented in balance sheet | 5 | 5 |
Interest Rate Contract [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Asset | 0 | 0 |
Derivative Liability, Fair Value, Gross Liability | 0 | 0 |
Derivative, Collateral, Right to Reclaim Cash | 0 | 0 |
Assets, net amount presented in balance sheet | 0 | 0 |
Liabilities, net amount presented in balance sheet | $ 0 | $ 0 |
Fair Value of Financial Instr35
Fair Value of Financial Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Available-for-sale Securities, Gross Unrealized Gain (Loss) | $ 0 | $ 0 | |
Assets | |||
Available-for-sale investment securities | 323 | $ 255 | |
Fair Value, Measurements, Recurring [Member] | |||
Assets | |||
Cash equivalents | 638 | 147 | |
Available-for-sale investment securities | 323 | 255 | |
Assets, Total | 961 | 402 | |
Liabilities | |||
Liabilities, Total | 5 | 5 | |
Fair Value, Measurements, Recurring [Member] | Aircraft Fuel Derivatives [Member] | |||
Liabilities | |||
Derivative Liability | 5 | 5 | |
Fair Value, Measurements, Recurring [Member] | Interest Rate Swap [Member] | |||
Liabilities | |||
Derivative Liability | 0 | 0 | |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | |||
Assets | |||
Cash equivalents | 638 | 147 | |
Available-for-sale investment securities | 140 | 75 | |
Assets, Total | 778 | 222 | |
Liabilities | |||
Liabilities, Total | 0 | 0 | |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | Aircraft Fuel Derivatives [Member] | |||
Liabilities | |||
Derivative Liability | 0 | 0 | |
Fair Value, Measurements, Recurring [Member] | Level 1 [Member] | Interest Rate Swap [Member] | |||
Liabilities | |||
Derivative Liability | 0 | 0 | |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | |||
Assets | |||
Cash equivalents | 0 | 0 | |
Available-for-sale investment securities | 183 | 180 | |
Assets, Total | 183 | 180 | |
Liabilities | |||
Liabilities, Total | 5 | 5 | |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | Aircraft Fuel Derivatives [Member] | |||
Liabilities | |||
Derivative Liability | 5 | 5 | |
Fair Value, Measurements, Recurring [Member] | Level 2 [Member] | Interest Rate Swap [Member] | |||
Liabilities | |||
Derivative Liability | 0 | 0 | |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | |||
Assets | |||
Cash equivalents | 0 | 0 | |
Available-for-sale investment securities | 0 | 0 | |
Assets, Total | 0 | 0 | |
Liabilities | |||
Liabilities, Total | 0 | 0 | |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | Aircraft Fuel Derivatives [Member] | |||
Liabilities | |||
Derivative Liability | 0 | 0 | |
Fair Value, Measurements, Recurring [Member] | Level 3 [Member] | Interest Rate Swap [Member] | |||
Liabilities | |||
Derivative Liability | $ 0 | $ 0 |