Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2023 | Nov. 06, 2023 | |
Cover [Abstract] | ||
Document type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-39541 | |
Entity registrant name | WHEELS UP EXPERIENCE INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 98-1617611 | |
Entity Address, Address Line One | 601 West 26th Street | |
Entity Address, Address Line Two | Suite 900 | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10001 | |
City Area Code | 212 | |
Local Phone Number | 257-5252 | |
Title of 12(b) Security | Class A common stock, $0.0001 par value per share | |
Trading Symbol | UP | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 166,812,505 | |
Entity CIK | 0001819516 | |
Amendment Flag | false | |
Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --12-31 | |
Fiscal Year Focus | 2023 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 244,847 | $ 585,881 |
Accounts receivable, net | 46,773 | 112,383 |
Other receivables | 7,452 | 5,524 |
Parts and supplies inventories, net | 23,979 | 29,000 |
Aircraft inventory | 2,073 | 24,826 |
Aircraft held for sale | 26,855 | 8,952 |
Prepaid expenses | 46,506 | 39,715 |
Other current assets | 11,283 | 13,338 |
Total current assets | 409,768 | 819,619 |
Property and equipment, net | 362,053 | 394,559 |
Operating lease right-of-use assets | 73,788 | 106,735 |
Goodwill | 214,808 | 348,118 |
Intangible assets, net | 122,783 | 141,765 |
Other non-current assets | 144,494 | 112,429 |
Total assets | 1,327,694 | 1,923,225 |
Current liabilities: | ||
Current maturities of long-term debt | 25,227 | 27,006 |
Accounts payable | 25,568 | 43,166 |
Accrued expenses | 100,814 | 148,947 |
Deferred revenue, current | 691,214 | 1,075,133 |
Other current liabilities | 26,197 | 49,968 |
Total current liabilities | 869,020 | 1,344,220 |
Long-term debt, net | 235,429 | 226,234 |
Deferred revenue, non-current | 1,155 | 1,742 |
Operating lease liabilities, non-current | 58,912 | 82,755 |
Warrant liability | 66 | 751 |
Other non-current liabilities | 17,873 | 15,603 |
Total liabilities | 1,182,455 | 1,671,305 |
Commitments and contingencies (Note 13) | ||
Equity: | ||
Common Stock, $0.0001 par value; 250,000,000 authorized; 167,080,450 and 25,198,298 shares issued and 166,804,743 and 24,933,857 shares outstanding as of September 30, 2023 and December 31, 2022, respectively | 17 | 3 |
Additional paid-in capital | 1,849,093 | 1,545,530 |
Accumulated deficit | (1,682,145) | (1,275,873) |
Accumulated other comprehensive loss | (14,007) | (10,053) |
Treasury stock, at cost, 275,707 and 264,441 shares, respectively | (7,718) | (7,687) |
Total Wheels Up Experience Inc. stockholders’ equity | 145,239 | 251,920 |
Non-controlling interests | 0 | 0 |
Total equity | 145,239 | 251,920 |
Total liabilities and equity | $ 1,327,694 | $ 1,923,225 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Common stock par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock authorized (in shares) | 250,000,000 | 250,000,000 |
Common stock issued (in shares) | 167,080,450 | 25,198,298 |
Common stock outstanding (in shares) | 166,804,743 | 24,933,857 |
Treasury stock, at cost (in shares) | 275,707 | 264,441 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
Revenue | $ 320,063 | $ 420,356 | $ 1,006,937 | $ 1,171,503 |
Costs and expenses: | ||||
Cost of revenue | 299,887 | 403,042 | 981,581 | 1,144,698 |
Technology and development | 19,962 | 16,639 | 50,265 | 42,436 |
Sales and marketing | 22,548 | 30,830 | 71,500 | 87,761 |
General and administrative | 42,853 | 44,323 | 122,334 | 130,200 |
Depreciation and amortization | 15,459 | 16,500 | 45,027 | 46,862 |
Gain on sale of aircraft held for sale | (7,841) | (1,316) | (11,328) | (3,950) |
Impairment of goodwill | 56,200 | 62,000 | 126,200 | 62,000 |
Total costs and expenses | 449,068 | 572,018 | 1,385,579 | 1,510,007 |
Loss from operations | (129,005) | (151,662) | (378,642) | (338,504) |
Other income (expense): | ||||
Loss on divestiture | 0 | (2,991) | 0 | |
Loss on extinguishment of debt | (1,936) | 0 | (2,806) | 0 |
Change in fair value of warrant liability | (61) | 2,504 | 685 | 8,265 |
Interest income | 404 | 1,130 | 6,090 | 1,612 |
Interest expense | (11,258) | 0 | (27,035) | 0 |
Other income (expense), net | 613 | (625) | (822) | (1,505) |
Total other income (expense) | (15,229) | 3,009 | (26,879) | 8,372 |
Loss before income taxes | (144,234) | (148,653) | (405,521) | (330,132) |
Income tax benefit (expense) | (579) | (185) | (751) | (505) |
Net loss | (144,813) | (148,838) | (406,272) | (330,637) |
Less: Net loss attributable to non-controlling interests | 0 | 0 | 0 | (387) |
Net loss attributable to Wheels Up Experience Inc. | $ (144,813) | $ (148,838) | $ (406,272) | $ (330,250) |
Net loss per share of Common Stock (Note 18) | ||||
Basic (in dollars per share) | $ (3.51) | $ (6.09) | $ (13.22) | $ (13.52) |
Diluted (in dollars per share) | $ (3.51) | $ (6.09) | $ (13.22) | $ (13.52) |
Weighted-average shares of Common Stock outstanding: | ||||
Basic (in shares) | 41,261,003 | 24,435,096 | 30,737,324 | 24,434,787 |
Diluted (in shares) | 41,261,003 | 24,435,096 | 30,737,324 | 24,434,787 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net loss | $ (144,813) | $ (148,838) | $ (406,272) | $ (330,637) |
Other comprehensive income (loss): | ||||
Foreign currency translation adjustments | (8,173) | (8,329) | (3,954) | (16,647) |
Comprehensive loss | (152,986) | (157,167) | (410,226) | (347,284) |
Less: Comprehensive loss attributable to non-controlling interests | 0 | 0 | 0 | (387) |
Comprehensive loss attributable to Wheels Up Experience Inc. | $ (152,986) | $ (157,167) | $ (410,226) | $ (346,897) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive loss | Treasury stock | Non-controlling interests |
Beginning balance (in shares) at Dec. 31, 2021 | 24,583,457 | ||||||
Beginning balance at Dec. 31, 2021 | $ 736,228 | $ 2 | $ 1,450,862 | $ (720,713) | $ 0 | $ 0 | $ 6,077 |
Beginning balance (in shares) at Dec. 31, 2021 | 0 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Equity-based compensation | 22,554 | 13,659 | 8,895 | ||||
Change in non-controlling interests allocation | 0 | 11,743 | (11,743) | ||||
Shares withheld for employee taxes on vested equity (in shares) | 168,238 | ||||||
Shares withheld for employee taxes on vested equity awards | (6,107) | $ (6,107) | |||||
Issuance of Common Stock upon settlement of restricted stock units (in shares) | 7,673 | ||||||
Net loss | (89,040) | (88,653) | (387) | ||||
Ending balance (in shares) at Mar. 31, 2022 | 24,591,130 | ||||||
Ending balance at Mar. 31, 2022 | 663,635 | $ 2 | 1,476,264 | (809,366) | 0 | $ (6,107) | 2,842 |
Ending balance (in shares) at Mar. 31, 2022 | 168,238 | ||||||
Beginning balance (in shares) at Dec. 31, 2021 | 24,583,457 | ||||||
Beginning balance at Dec. 31, 2021 | 736,228 | $ 2 | 1,450,862 | (720,713) | 0 | $ 0 | 6,077 |
Beginning balance (in shares) at Dec. 31, 2021 | 0 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net loss | (330,637) | ||||||
Ending balance (in shares) at Sep. 30, 2022 | 24,813,155 | ||||||
Ending balance at Sep. 30, 2022 | 447,435 | $ 2 | 1,522,391 | (1,050,964) | (16,647) | $ (7,347) | 0 |
Ending balance (in shares) at Sep. 30, 2022 | 238,658 | ||||||
Beginning balance (in shares) at Mar. 31, 2022 | 24,591,130 | ||||||
Beginning balance at Mar. 31, 2022 | 663,635 | $ 2 | 1,476,264 | (809,366) | 0 | $ (6,107) | 2,842 |
Beginning balance (in shares) at Mar. 31, 2022 | 168,238 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Equity-based compensation | 20,781 | 12,328 | 8,453 | ||||
Change in non-controlling interests allocation | 0 | 11,295 | (11,295) | ||||
Shares withheld for employee taxes on vested equity (in shares) | 23,086 | ||||||
Shares withheld for employee taxes on vested equity awards | (582) | $ (582) | |||||
Issuance of Common Stock upon settlement of restricted stock units (in shares) | 27,625 | ||||||
Net loss | (92,760) | (92,760) | |||||
Other comprehensive loss | (8,318) | (8,318) | |||||
Ending balance (in shares) at Jun. 30, 2022 | 24,618,755 | ||||||
Ending balance at Jun. 30, 2022 | 582,756 | $ 2 | 1,499,887 | (902,126) | (8,318) | $ (6,689) | 0 |
Ending balance (in shares) at Jun. 30, 2022 | 191,324 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Equity-based compensation | 22,504 | 13,961 | 8,543 | ||||
Change in non-controlling interests allocation | 0 | 8,543 | (8,543) | ||||
Shares withheld for employee taxes on vested equity (in shares) | 47,334 | ||||||
Shares withheld for employee taxes on vested equity awards | (658) | $ (658) | |||||
Issuance of Common Stock upon settlement of restricted stock units (in shares) | 194,400 | ||||||
Net loss | (148,838) | (148,838) | |||||
Other comprehensive loss | (8,329) | (8,329) | |||||
Ending balance (in shares) at Sep. 30, 2022 | 24,813,155 | ||||||
Ending balance at Sep. 30, 2022 | $ 447,435 | $ 2 | 1,522,391 | (1,050,964) | (16,647) | $ (7,347) | 0 |
Ending balance (in shares) at Sep. 30, 2022 | 238,658 | ||||||
Beginning balance (in shares) at Dec. 31, 2022 | 24,933,857 | 25,198,298 | |||||
Beginning balance at Dec. 31, 2022 | $ 251,920 | $ 3 | 1,545,530 | (1,275,873) | (10,053) | $ (7,687) | 0 |
Beginning balance (in shares) at Dec. 31, 2022 | 264,441 | 264,441 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Equity-based compensation | $ 11,210 | 9,951 | 1,259 | ||||
Change in non-controlling interests allocation | 0 | 1,259 | (1,259) | ||||
Issuance of Common Stock upon settlement of restricted stock units (in shares) | 227,513 | ||||||
Net loss | (100,866) | (100,866) | |||||
Other comprehensive loss | 923 | 923 | |||||
Ending balance (in shares) at Mar. 31, 2023 | 25,425,811 | ||||||
Ending balance at Mar. 31, 2023 | $ 163,187 | $ 3 | 1,556,740 | (1,376,739) | (9,130) | $ (7,687) | 0 |
Ending balance (in shares) at Mar. 31, 2023 | 264,441 | ||||||
Beginning balance (in shares) at Dec. 31, 2022 | 24,933,857 | 25,198,298 | |||||
Beginning balance at Dec. 31, 2022 | $ 251,920 | $ 3 | 1,545,530 | (1,275,873) | (10,053) | $ (7,687) | 0 |
Beginning balance (in shares) at Dec. 31, 2022 | 264,441 | 264,441 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Shares withheld for employee taxes on vested equity (in shares) | 275,707 | ||||||
Net loss | $ (406,272) | ||||||
Ending balance (in shares) at Sep. 30, 2023 | 166,804,743 | 167,080,450 | |||||
Ending balance at Sep. 30, 2023 | $ 145,239 | $ 17 | 1,849,093 | (1,682,145) | (14,007) | $ (7,718) | 0 |
Ending balance (in shares) at Sep. 30, 2023 | 275,707 | 275,707 | |||||
Beginning balance (in shares) at Mar. 31, 2023 | 25,425,811 | ||||||
Beginning balance at Mar. 31, 2023 | $ 163,187 | $ 3 | 1,556,740 | (1,376,739) | (9,130) | $ (7,687) | 0 |
Beginning balance (in shares) at Mar. 31, 2023 | 264,441 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Equity-based compensation | 6,604 | 6,592 | 12 | ||||
Change in non-controlling interests allocation | 0 | 12 | (12) | ||||
Reclassification of equity awards | 328 | 328 | |||||
Issuance of Common Stock upon settlement of restricted stock units (in shares) | 196,685 | ||||||
Reverse stock split fractional shares (in shares) | 859 | ||||||
Reverse stock split fractional shares | (3) | $ (3) | |||||
Net loss | (160,593) | (160,593) | |||||
Other comprehensive loss | 3,296 | 3,296 | |||||
Ending balance (in shares) at Jun. 30, 2023 | 25,622,496 | ||||||
Ending balance at Jun. 30, 2023 | 12,819 | $ 3 | 1,563,672 | (1,537,332) | (5,834) | $ (7,690) | 0 |
Ending balance (in shares) at Jun. 30, 2023 | 265,300 | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Equity-based compensation | 3,509 | 3,503 | 6 | ||||
Change in non-controlling interests allocation | 0 | 6 | (6) | ||||
Issuance of common stock and Deferred Shares in connection with debt issuance (in shares) | 141,313,671 | ||||||
Issuance of Common Stock and Deferred Shares in connection with debt issuance | 281,926 | $ 14 | 281,912 | ||||
Shares withheld for employee taxes on vested equity (in shares) | 10,407 | ||||||
Shares withheld for employee taxes on vested equity awards | (28) | $ (28) | |||||
Issuance of Common Stock upon settlement of restricted stock units (in shares) | 144,283 | ||||||
Net loss | (144,813) | (144,813) | |||||
Other comprehensive loss | $ (8,173) | (8,173) | |||||
Ending balance (in shares) at Sep. 30, 2023 | 166,804,743 | 167,080,450 | |||||
Ending balance at Sep. 30, 2023 | $ 145,239 | $ 17 | $ 1,849,093 | $ (1,682,145) | $ (14,007) | $ (7,718) | $ 0 |
Ending balance (in shares) at Sep. 30, 2023 | 275,707 | 275,707 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities | ||
Net loss | $ (406,272) | $ (330,637) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 45,027 | 46,862 |
Equity-based compensation | 21,650 | 65,839 |
Payment in kind interest | 972 | 0 |
Amortization of deferred financing costs and debt discount | 2,390 | 0 |
Change in fair value of warrant liability | (685) | (8,265) |
Gain on sale of aircraft held for sale | (11,328) | (3,950) |
Loss on divestiture | 2,991 | 0 |
Loss on extinguishment of debt | 2,806 | 0 |
Impairment of goodwill | 126,200 | 62,000 |
Other | (2,099) | (489) |
Changes in assets and liabilities: | ||
Accounts receivable | 22,513 | (31,474) |
Parts and supplies inventories | 5,074 | (8,544) |
Aircraft inventory | 386 | (33,231) |
Prepaid expenses | (8,589) | (8,065) |
Other non-current assets | (36,988) | (27,534) |
Accounts payable | (15,177) | (2,885) |
Accrued expenses | (36,293) | (1,131) |
Deferred revenue | (378,949) | (2,653) |
Other assets and liabilities | 4,877 | (4,184) |
Net cash used in operating activities | (661,494) | (288,341) |
Cash flows from investing activities | ||
Purchases of property and equipment | (12,312) | (80,039) |
Purchases of aircraft held for sale | (2,311) | (39,894) |
Proceeds from sale of aircraft held for sale, net | 53,911 | 41,833 |
Proceeds from sale of divested business, net | 13,200 | 0 |
Acquisitions of businesses, net of cash acquired | 0 | (75,093) |
Capitalized software development costs | (16,041) | (18,532) |
Other | 172 | 0 |
Net cash (used in) provided by investing activities | 36,619 | (171,725) |
Cash flows from financing activities | ||
Purchase shares for treasury | 0 | (7,347) |
Purchase of fractional shares | (3) | 0 |
Proceeds from notes payable | 70,000 | 0 |
Repayment of notes payable | (70,000) | 0 |
Proceeds from long-term debt, net | 343,000 | 0 |
Payment of debt issuance costs in connection with debt | (19,630) | 0 |
Repayments of long-term debt | (40,196) | 0 |
Net cash (used in) provided by financing activities | 283,171 | (7,347) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (4,287) | (7,395) |
Net decrease in cash, cash equivalents and restricted cash | (345,991) | (474,808) |
Cash, cash equivalents and restricted cash, beginning of period | 620,153 | 786,722 |
Cash, cash equivalents and restricted cash, end of period | 274,162 | 311,914 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | $ 23,919 | $ 0 |
SUMMARY OF BUSINESS AND SIGNIFI
SUMMARY OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
SUMMARY OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES Wheels Up Experience Inc. (together with its consolidated subsidiaries, “Wheels Up”, the “Company”, “we”, “us”, or “our”) is a leading provider of on-demand private aviation in the United States (“U.S.”) and one of the largest private aviation companies in the world. Wheels Up offers a complete global aviation solution with a large, modern and diverse fleet, backed by an uncompromising commitment to safety and service. Customers can access membership programs, charter, aircraft management services and whole aircraft sales, as well as unique commercial travel benefits through a strategic partnership with Delta Air Lines, Inc. (“Delta”). Wheels Up also offers freight, safety and security solutions and managed services to individuals, industry, government and civil organizations. Wheels Up is guided by the mission to connect private flyers to aircraft, and one another, through an open platform that seamlessly enables life’s most important experiences. Powered by a global private aviation marketplace connecting its base of approximately 11,000 members and customers to a network of approximately 1,500 safety-vetted and verified private aircraft, Wheels Up is widening the aperture of private travel for millions of consumers globally. With the Wheels Up mobile app and website, members and customers have the digital convenience to search, book and fly. Basis of Presentation The condensed consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial reporting and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the financial information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of the Company’s management, the condensed consolidated financial statements include all adjustments necessary for the fair presentation of the Company’s balance sheet as of September 30, 2023, its results of operations, including its comprehensive loss and stockholders' equity for the three months ended September 30, 2023 and 2022, and its results of operations, including its comprehensive loss and stockholders' equity and its cash flows for the nine months ended September 30, 2023 and 2022. All adjustments are of a normal recurring nature. The results for the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for any subsequent quarter or for the fiscal year ending December 31, 2023. Immediately after the close of business on the New York Stock Exchange (the “ NYSE”) on June 7, 2023, the reverse stock split of Wheels Up’s outstanding shares of Common Stock, at a reverse stock split ratio of 1-for-10 (the “Reverse Stock Split”) and contemporaneously with the Reverse Stock Split, a proportionate reduction in the number of authorized shares of Common Stock from 2.5 billion shares of Common Stock to 250 million shares (the “Authorized Share Reduction”). Accordingly, the presentation of all periods covered by the condensed consolidated financial statements contained herein have been adjusted to give retroactive effect to the Reverse Stock Split, including adjustments to per share net loss and other per share of Common Stock amounts. These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information. Consistent with these requirements, this Form 10-Q does not include all the information required by GAAP for complete financial statements. As a result, this Form 10-Q should be read in conjunction with the audited consolidated financial statements and related notes included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on March 31, 2023. Liquidity The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the ordinary course of business. As disclosed on August 14, 2023, in the notes to the condensed consolidated financial statements for the interim period ended June 30, 2023, the Company demonstrated various adverse conditions that raised substantial doubt about the Company’s ability to continue as a going concern. These adverse conditions included insufficient liquidity, a working capital deficit, net operating cash outflows, recurring losses from operations, and the applicability of certain liquidity covenants in connection with the Equipment Notes (as defined in Note 7). Subsequent to August 14, 2023, we obtained funding as discussed in Note 7, Long-Term Debt , amended the Equipment Notes to reduce liquidity covenant requirements and divested the aircraft management business as discussed in Note 4, Acquisitions and Divestitures . During the third quarter of 2023, we also began to realize the impacts of our spend reduction efforts, as a result of the restructuring and operational changes implemented throughout 2023. We have concluded that these events and circumstances, and continued execution of our previously implemented plans, as outlined above, have mitigated the conditions that previously raised substantial doubt about our ability to continue as a going concern. Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. We consolidate Wheels Up MIP LLC (“MIP LLC”) and record the profits interests held in MIP LLC that Wheels Up does not own as non-controlling interests (see Note 12). All intercompany transactions and balances have been eliminated in consolidation. Use of Estimates Preparing the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates due to risks and uncertainties. The most significant estimates include, but are not limited to, the useful lives and residual values of purchased aircraft, the fair value of financial assets and liabilities, acquired intangible assets, goodwill, contingent consideration and other assets and liabilities, sales and use tax, the estimated life of member relationships, the determination of the allowance for credit losses, impairment assessments, the determination of the valuation allowance for deferred tax assets and the incremental borrowing rate for leases. Foreign Currency Translation Adjustments Assets and liabilities of foreign subsidiaries, where the functional currency is not the U.S. dollar, have been translated at period-end exchange rates and profit and loss accounts have been translated using weighted-average exchange rates. Adjustments resulting from currency translation have been recorded in the equity section of the condensed consolidated balance sheets and the condensed consolidated statements of other comprehensive loss as a cumulative translation adjustment. Impairment During the second quarter of 2023, we determined that, because of continued negative cash flows and changes in our management and business strategy, there was an indication that the carrying value of the long-lived assets associated with the WUP Legacy reporting unit may not be recoverable. As a result, we performed an undiscounted cash flow analysis of our long-lived assets for potential impairment as of June 1, 2023. Based on the analysis, it was determined that there was no impairment to our long-lived assets. As a result of the aforementioned factors, we determined that there was an indication that it was more likely than not that the fair value of our WUP Legacy reporting unit was less than its carrying amount. We performed an interim quantitative impairment assessment of goodwill as of June 1, 2023. Using a discounted cash flow approach, we calculated the fair value of WUP Legacy based on the present value of estimated future cash flows. The significant underlying inputs used to measure the fair value included forecasted revenue growth rates and margins, weighted average cost of capital, normalized working capital level and projected long-term growth rates. As a result of this assessment, we recognized a goodwill impairment charge of $70.0 million relating to the WUP Legacy reporting unit during the three months ended June 30, 2023. The decline in the fair value of the reporting unit was primarily due to a more material reduction in working capital than expected during the three months ended June 30, 2023, as well as an increase in the discount rate. To facilitate reconciliation of the fair value of our reporting units to our market capitalization as of June 1, 2023, we elected to perform a quantitative impairment assessment of the Air Partner reporting unit as of June 1, 2023, using a combination of the discounted cash flow and guideline public company methods, which did not result in impairment to goodwill. Based on the valuation, the fair value of the Air Partner reporting unit exceeded its carrying value by more than 10%. During the third quarter of 2023, we determined that upon entering into the Term Loan and Revolving Credit Facility (as each is defined below) on September 20, 2023 (see Note 7), and due to associated changes to our ownership and governance structure on that same date (see Note 10), there was an indication that the fair value of the WUP Legacy reporting unit was less than its carrying amount. We performed an interim quantitative impairment assessment of goodwill as of September 20, 2023. Using a discounted cash flow approach, we calculated the fair value of WUP Legacy, based on the present value of estimated future cash flows. The significant underlying inputs used to measure the fair value included forecasted revenue growth rates and margins, weighted average cost of capital, normalized working capital level and projected long-term growth rates. As a result of this assessment, we recognized a goodwill impairment charge of $56.2 million relating to the WUP Legacy reporting unit during the three months ended September 30, 2023. The impairment charge represents the amount by which the carrying value of the reporting unit as of the assessment date exceeded the estimated fair value of the reporting unit as of the assessment date. Since the previous analysis on June 1, 2023, the fair value of the reporting unit increased as a result of the run-off of unprofitable periods in our estimated future cash flows; however, the carrying value of the reporting unit increased in a substantially equivalent amount due to the issuance of the Term Loan (see Note 7) and Initial Shares (as defined in Note 10). To facilitate reconciliation of the fair value of our reporting units to our market capitalization as of September 20, 2023, we elected to perform a quantitative impairment assessment of the Air Partner reporting unit as of September 20, 2023, using a combination of the discounted cash flow and guideline public company methods, which did not result in impairment to goodwill. Based on the valuation, the fair value of the Air Partner reporting unit exceeded its carrying value by more than 20%. Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Effective There have been no recent accounting pronouncements, changes in accounting pronouncements or recently adopted accounting guidance during the three months ended September 30, 2023 that are of significance or potential significance to us. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE RECOGNITION | REVENUE RECOGNITION Disaggregation of Revenue The following table disaggregates revenue by service type and the timing of when these services are provided to the member or customer (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Services transferred at a point in time: Flights, net of discounts and incentives $ 214,645 $ 278,917 $ 681,691 $ 799,351 Aircraft management 51,081 56,558 158,396 172,914 Other 29,720 58,728 89,665 121,695 Services transferred over time: Memberships 20,622 22,409 63,780 67,076 Aircraft management 2,154 2,404 7,035 7,272 Other 1,841 1,340 6,370 3,195 Total $ 320,063 $ 420,356 $ 1,006,937 $ 1,171,503 Revenue in the condensed consolidated statements of operations is presented net of discounts and incentives of $2.7 million and $6.7 million for the three and nine months ended September 30, 2023, respectively, and $2.7 million and $9.4 million for the three and nine months ended September 30, 2022, respectively. Other revenue included within services transferred at a point in time is primarily related to revenue for group charter of $9.8 million, safety and security of $5.9 million, one-time software license revenue of $5.9 million and whole aircraft sales of $2.8 million for the three months ended September 30, 2023, and whole aircraft sales of $35.9 million, group charter of $8.7 million, and safety and security of $5.9 million for the three months ended September 30, 2022. Other revenue included within services transferred at a point in time is primarily related to revenue for group charter of $25.7 million, whole aircraft sales of $18.2 million, safety and security of $17.5 million and software license revenue of $7.0 million for the nine months ended September 30, 2023, and whole aircraft sales of $63.9 million, group charter of $19.8 million, and safety and security of $12.6 million for the nine months ended September 30, 2022. Contract Balances Accounts receivable, net consists of the following (in thousands): September 30, December 31, Gross receivables from members and customers $ 49,705 $ 112,243 Undeposited funds 5,304 10,122 Less: Allowance for credit losses (8,236) (9,982) Accounts receivable, net $ 46,773 $ 112,383 Deferred revenue consists of the following (in thousands): September 30, December 31, Flights - Prepaid Blocks $ 651,458 $ 1,023,985 Memberships - annual dues 35,935 43,970 Memberships - initiation fees 2,804 3,899 Flights - credits 1,773 4,246 Other 399 775 Deferred revenue - total 692,369 1,076,875 Less: Deferred revenue - current (691,214) (1,075,133) Deferred revenue - non-current $ 1,155 $ 1,742 Changes in deferred revenue for the nine months ended September 30, 2023 were as follows (in thousands): Deferred revenue as of December 31, 2022 $ 1,076,875 Amounts deferred during the period 342,923 Revenue recognized from amounts included in the deferred revenue beginning balance (571,211) Revenue from current period sales (156,218) Deferred revenue as of September 30, 2023 $ 692,369 Revenue expected to be recognized in future periods for performance obligations that are unsatisfied, or partially unsatisfied, as of September 30, 2023 were as follows (in thousands): Remainder of 2023 $ 113,830 2024 292,149 2025 143,268 2026 143,122 Total $ 692,369 Costs to Obtain a Contract Capitalized costs related to sales commissions and referral fees were $1.9 million and $6.0 million for the three and nine months ended September 30, 2023, respectively, and $3.3 million and $12.6 million for the three and nine months ended September 30, 2022, respectively. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT Property and equipment consist of the following (in thousands): September 30, 2023 December 31, 2022 Aircraft $ 509,984 $ 566,338 Software development costs 80,582 65,303 Leasehold improvements 22,274 11,930 Computer equipment 3,447 3,014 Buildings and improvements 1,424 1,424 Furniture and fixtures 4,311 3,208 Tooling 4,180 3,835 Vehicles 2,351 1,538 628,553 656,590 Less: Accumulated depreciation and amortization (266,500) (262,031) Total $ 362,053 $ 394,559 Depreciation and amortization expense, excluding amortization expense related to software development costs, was $10.0 million and $28.8 million for the three and nine months ended September 30, 2023, respectively, and $10.6 million and $30.3 million for the three and nine months ended September 30, 2022, respectively. |
ACQUISITIONS AND DIVESTITURES
ACQUISITIONS AND DIVESTITURES | 9 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
ACQUISITIONS AND DIVESTITURES | ACQUISITIONS AND DIVESTITURES Alante Air Charter, LLC Acquisition On February 3, 2022, we acquired all of the outstanding equity of Alante Air Charter, LLC (“Alante Air”) for a total purchase price of $15.5 million in cash. Alante Air added 12 Light jets to our controlled fleet and expanded our presence in the Western U.S. Acquisition-related costs for Alante Air of $0.5 million were included in General and administrative expense in the condensed consolidated statements of operations for the three months ended September 30, 2022. The acquisition of Alante Air was determined to be a business combination. We have allocated the purchase price for Alante Air to its individual assets and liabilities assumed. As of the date of acquisition, the total purchase price allocated to the Alante Air assets acquired and liabilities assumed according to their estimated fair values were as follows (in thousands): Current assets $ 4,452 Goodwill 13,069 Other assets 22,048 Total assets acquired 39,569 Total liabilities assumed (24,101) Net assets acquired $ 15,468 Current assets of Alante Air included $3.0 million of cash and $1.4 million of accounts receivable, including $15 thousand owed from Wheels Up that was eliminated in consolidation upon acquisition. Goodwill represents the excess of the purchase price over the fair values of the acquired net tangible assets. The allocated value of goodwill primarily relates to anticipated synergies and economies of scale by combining the use of Alante Air’s aircraft and existing business processes with our other acquisitions. The acquired goodwill is deductible for tax purposes. Air Partner plc Acquisition On April 1, 2022, we acquired all of the outstanding equity of Air Partner plc (“Air Partner”) for a total purchase price of $108.2 million in cash. Air Partner is a United Kingdom-based international aviation services group that provides us with operations in 18 locations across four continents. Acquisition-related costs for Air Partner included in General and administrative expense in the condensed consolidated statements of operations for the three months ended September 30, 2022 were immaterial. The acquisition of Air Partner was determined to be a business combination. As of the date of acquisition, the total purchase price allocated to the Air Partner assets acquired and liabilities assumed according to their estimated fair values were as follows (in thousands): Current assets $ 49,617 Property and equipment, net 2,012 Operating lease right-of-use assets 2,780 Goodwill 83,910 Intangible assets 20,921 Restricted cash 27,507 Other assets 1,686 Total assets acquired 188,433 Total liabilities assumed (80,239) Net assets acquired $ 108,194 Current assets of Air Partner included $18.0 million of cash and $16.6 million of accounts receivable. The allocated value of goodwill primarily relates to anticipated synergies and economies of scale by combining the use of Air Partner’s existing business processes with our platform to expand on an international basis. The acquired goodwill is not deductible for tax purposes. The amounts allocated to acquired intangible assets and their associated weighted-average amortization periods, which were determined based on the period the assets are expected to contribute directly or indirectly to our cash flows, consisted of the following: Amount Weighted-Average Amortization Period Customer relationships $ 16,521 5.7 Backlog 1,458 1.5 Trade name 1,931 1.9 Developed technology 1,011 5.8 Total acquired intangible assets $ 20,921 5.1 The intangible asset fair value measurements are primarily based on significant inputs that are not observable in the market which represent a Level 3 measurement (see Note 8). The valuation method used for the Air Partner intangible assets was the income approach. Unaudited Pro Forma Summary of Operations The accompanying unaudited pro forma summary represents the consolidated results of operations as if the 2022 acquisitions of Alante Air and Air Partner had been completed as of January 1, 2022. The unaudited pro forma financial results for 2022 reflect the results for the three and nine months ended September 30, 2022, as well as the effects of pro forma adjustments for the transactions in 2022. The unaudited pro forma financial information includes the accounting effects of the acquisitions, including adjustments to the amortization of intangible assets and professional fees associated with the transactions. The pro forma results were based on estimates and assumptions, which we believe are reasonable but remain subject to adjustment. The unaudited pro forma summary does not necessarily reflect the actual results that would have been achieved had the companies been combined during the periods presented, nor is it necessarily indicative of future consolidated results (in thousands, except per share data). Nine Months Ended September 30, 2022 Net revenue $ 1,209,321 Net loss $ (266,628) Net loss attributable to Wheels Up Experience Inc. $ (266,628) Net loss per share (1) $ (10.98) (1) Adjusted for the impact of the Reverse Stock Split Divestiture of Aircraft Management Business On September 30, 2023, (the “Closing Date”), Wheels Up Partners Holdings LLC, our direct subsidiary (“WUP”), pursuant to an equity purchase agreement (the “Purchase Agreement”) with Executive AirShare LLC, completed the sale of 100% of the issued and outstanding equity interests of Circadian Aviation LLC, our indirect subsidiary (“Circadian”). The Closing Date fair value of the aggregate consideration transferred was $19.1 million and the Company recognized a loss on the sale of $3.0 million. The $19.1 million was comprised of $13.2 million of cash received on the Closing Date, contingent consideration with a fair value of $4.8 million, an escrow receivable of $0.6 million and a non-contingent consideration receivable of $0.5 million. The fair value of the contingent consideration was deemed to be the approximate contract value as of the Closing Date. Circadian was released from all guarantor obligations with respect to the Equipment Notes (as defined below) on the Closing Date pursuant to certain debt release letters entered into concurrently with the Purchase Agreement. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS Goodwill The following table presents goodwill carrying values and the change in balance, by reporting unit, during the nine months ended September 30, 2023 (in thousands): WUP Legacy Air Partner Total Balance as of December 31, 2022 (1) $ 270,467 $ 77,651 $ 348,118 Acquisitions (2) — 350 350 Impairment (3) (126,200) — (126,200) Divestitures (4) (8,169) — (8,169) Foreign currency translation adjustment — 708 708 Balance as of September 30, 2023 $ 136,098 $ 78,710 $ 214,808 (1) Net of accumulated impairment losses of $180 million, all of which was recognized on the goodwill attributable to the WUP Legacy reporting unit during the year ended December 31, 2022. (2) Reflects the current period impact of measurement period adjustments (See Note 4) (3) Impairment charge recognized during the second and third quarters of 2023 as a result of an interim quantitative assessments of goodwill as of June 1, 2023 and September 20, 2023, respectively (See Note 1) (4) Reflects the amount of goodwill allocated to the divestiture of the aircraft management business (See Note 4). Intangible Assets The gross carrying value, accumulated amortization and net carrying value of intangible assets consisted of the following (in thousands): September 30, 2023 Gross Carrying Accumulated Amortization Net Carrying Status $ 80,000 $ 29,644 $ 50,356 Customer relationships 89,121 32,226 56,895 Trade name 13,161 6,321 6,840 Developed technology 20,556 11,580 8,976 Leasehold interest - favorable 600 96 504 Backlog 1,458 1,313 145 Foreign currency translation adjustment (1,480) (547) (933) Total $ 203,626 $ 80,843 $ 122,783 December 31, 2022 Gross Carrying Accumulated Amortization Net Carrying Status $ 80,000 $ 23,644 $ 56,356 Customer relationships 91,121 24,613 66,508 Non-competition agreement 210 210 — Trade name 16,161 8,294 7,867 Developed technology 20,556 9,332 11,224 Leasehold interest - favorable 600 80 520 Backlog 1,458 880 578 Foreign currency translation adjustment (1,662) (374) (1,288) Total $ 208,444 $ 66,679 $ 141,765 Amortization expense of intangible assets was $6.0 million and $17.8 million for the three and nine months ended September 30, 2023, respectively, and $6.4 million and $18.1 million for the three and nine months ended September 30, 2022, respectively. Intangible Liabilities Associated with our acquisition of Delta Private Jets on January 17, 2020, we recognized intangible liabilities for the fair value of complimentary Connect Memberships provided to existing Delta SkyMiles 360 customers as of the acquisition date, as required under the Commercial Cooperation Agreement (as amended, the “CCA”) with Delta. The gross carrying value, accumulated amortization and net carrying value of intangible liabilities consisted of the following (in thousands): September 30, 2023 Gross Carrying Accumulated Amortization Net Carrying Intangible liabilities $ 20,000 $ 7,417 $ 12,583 December 31, 2022 Gross Carrying Accumulated Amortization Net Carrying Intangible liabilities $ 20,000 $ 5,917 $ 14,083 Amortization of intangible liabilities, which reduces amortization expense, was $0.5 million for each of the three months ended September 30, 2023, and 2022, and $1.5 million for each of the nine months ended September 30, 2023, and 2022. Future amortization expense of intangible assets and intangible liabilities held as of September 30, 2023, were as follows (in thousands): Intangible Assets Intangible Liabilities Remainder of 2023 $ 5,865 $ 500 2024 22,759 2,000 2025 22,345 2,000 2026 21,486 2,000 2027 17,018 2,000 2028 and Thereafter 33,310 4,083 Total $ 122,783 $ 12,583 |
CASH EQUIVALENTS AND RESTRICTED
CASH EQUIVALENTS AND RESTRICTED CASH | 9 Months Ended |
Sep. 30, 2023 | |
Cash and Cash Equivalents [Abstract] | |
CASH EQUIVALENTS AND RESTRICTED CASH | CASH EQUIVALENTS AND RESTRICTED CASH Cash Equivalents As of September 30, 2023 and December 31, 2022, cash equivalents on the condensed consolidated balance sheets were $0.1 million and $430.3 million, respectively, and generally consisted of investments in money market funds, savings and time deposits. Restricted Cash As of September 30, 2023 and December 31, 2022, restricted cash, which is presented within Other non-current assets on the condensed consolidated balance sheets, included $6.2 million held by financial institutions to establish standby letters of credit required by the lessors of certain corporate office space that we leased as of such dates and $3.4 million held by financial institutions to collateralize against our credit card programs. The standby letters of credit expire on December 31, 2033 and June 30, 2034. The balances as of September 30, 2023 and December 31, 2022 also included $19.7 million and $26.3 million, respectively, related to funds held but unavailable for immediate use due to contractual restrictions. A reconciliation of cash and cash equivalents and restricted cash from the condensed consolidated balance sheets to the condensed consolidated statements of cash flows is as follows (in thousands): September 30, 2023 December 31, 2022 Cash and cash equivalents $ 244,847 $ 585,881 Restricted cash 29,315 34,272 Total $ 274,162 $ 620,153 |
LONG-TERM DEBT
LONG-TERM DEBT | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT The following table presents the components of long-term debt on our condensed consolidated balance sheets (in thousands): Weighted Average Interest Rate September 30, 2023 December 31, 2022 Equipment Notes 12.0 % $ 232,610 $ 270,000 Term Loan 10.0 % 350,972 — Total debt 583,582 270,000 Less: Total unamortized deferred financing costs and debt discount 322,926 16,760 Less: Current maturities of long-term debt 25,227 27,006 Long-term debt $ 235,429 $ 226,234 Maturities of our principal debt payments for the next five years are as follows (in thousands): Maturities Remainder of 2023 $ 6,307 2024 25,227 2025 43,916 2026 38,907 2027 33,258 2028 and Thereafter 435,967 Total $ 583,582 2022-1 Equipment Notes On October 14, 2022, WUP LLC issued $270.0 million aggregate principal amount of 12% fixed rate equipment notes (collectively, the “Equipment Notes”) using an EETC (enhanced equipment trust certificate) loan structure. The Equipment Notes were issued for net proceeds (before transaction-related expense) of $259.2 million. The final expected distribution date of the Equipment Notes varies from July 15, 2025 to October 15, 2029, unless redeemed earlier by WUP LLC. The Equipment Notes bear interest at the rate of 12% per annum with annual amortization of the principal amount equal to 10% per annum and balloon payments due at each maturity date. As of September 30, 2023, the Equipment Notes were secured by first-priority liens on 127 of the Company’s owned aircraft fleet and by liens on certain intellectual property assets of the Company and certain of its subsidiaries (collectively, the “Equipment Note Collateral”). The Equipment Notes were sold pursuant to a Note Purchase Agreement, dated as of October 14, 2022 (the “Note Purchase Agreement”), and issued under separate Trust Indentures and Mortgages, dated as of October 14, 2022 (each, an “Indenture” and collectively, the “Indentures”). On September 20, 2023, the Company, WUP LLC, certain other subsidiaries of the Company that guaranteed and/or granted collateral to secure WUP LLC’s obligations under the Equipment Notes, Wilmington Trust National Association (“WTNA”), and the Lenders (as defined below) entered into the Omnibus Amendment No. 1 (the “Omnibus Amendment”). The Omnibus Amendment provides for, among other things, (i) reducing the minimum liquidity covenant under the guarantee agreement related to the Equipment Notes (the “Guarantee”) with respect to the Company and its subsidiaries from $125.0 million as of the end of each fiscal quarter to $75.0 million on any date, (ii) permitting the execution of the Credit Agreement (as defined below) and (iii) reflecting the consent of the Equipment Note lenders that will allow the Company to effect a sale of certain guarantors under the Guarantee. The Note Purchase Agreement, the Indentures and the Guarantee, as each was amended by the Omnibus Amendment, contain certain covenants, including a liquidity covenant that requires the Company to maintain minimum aggregate available cash and Cash Equivalents (as defined in the Note Purchase Agreement), including certain amounts held in deposit for the benefit of the lenders, of $75.0 million on any date, a covenant that limits the maximum loan to appraised value ratio of all aircraft financed, subject to certain cure rights of the Company, and restrictive covenants that provide limitations under certain circumstances on, among other things: (i) making certain acquisitions, mergers or disposals of its assets; (ii) making certain investments or entering into certain transactions with affiliates; (iii) prepaying, redeeming or repurchasing the Equipment Notes, subject to certain exceptions; and (iv) paying dividends and making certain other specified restricted payments. Each Indenture contains customary events of default for Equipment Notes of this type, including cross-default provisions among the Equipment Notes and the Term Loan and Revolving Credit Facility (as each term is defined below). WUP LLC’s obligations under the Equipment Notes are guaranteed by the Company and certain of its subsidiaries. WUP LLC is also obligated to cause additional subsidiaries and affiliates of WUP LLC to become guarantors under certain circumstances. The Equipment Notes issued with respect to each aircraft are cross-collateralized by the other aircraft for which Equipment Notes were issued under the Indentures. The maturity of the Equipment Notes may be accelerated upon the occurrence of certain events of default under the Note Purchase Agreement and each Indenture and the related guarantees. As of September 30, 2023, we were in compliance with the covenants under the Note Purchase Agreement, each Indenture and the related guarantees. We recognized $4.9 million in General and administrative expense in the condensed consolidated statement of operations associated with executing the Omnibus Amendment. Interest and principal payments on the Equipment Notes are payable quarterly on each January 15, April 15, July 15 and October 15, which began on January 15, 2023. During the nine months ended September 30, 2023, the Company redeemed in-full the Equipment Notes for seven aircraft, which reduced the aggregate principal amount outstanding under the Equipment Notes by $17.4 million. As of September 30, 2023, the carrying value of the 127 aircraft that are subject to first-priority liens under the Equipment Notes was $300.2 million. Amortization expense for debt discounts and deferred financing costs of $0.3 million and $2.7 million was recorded in interest expense in the condensed consolidated statement of operations for the three and nine months ended September 30, 2023, respectively. Delta Promissory Note On August 8, 2023, the Company entered into a Secured Promissory Note (the “Note”) with Delta, as payee, which was subsequently amended pursuant to the First Amendment thereto, dated August 15, 2023, the Second Amendment thereto, dated August 21, 2023, the Third Amendment thereto, dated September 6, 2023, and the Fourth Amendment thereto, dated September 14, 2023 (collectively, the “Amendments” and, collectively with the Note, the “Amended Note”), pursuant to which Delta provided $70.0 million aggregate principal amount of short-term funding to the Company at an interest rate of 10% per annum, which was payable in kind and capitalized to the outstanding principal amount of the Amended Note on a quarterly basis and a maturity date of February 4, 2024. The Amended Note was secured by a first-priority lien on unencumbered assets of the Company and its direct and indirect wholly-owned U.S. subsidiaries, including unencumbered aircraft of WUP LLC. The Amended Note was guaranteed by the Company’s wholly-owned U.S. subsidiaries. On September 20, 2023, the Company repaid all amounts due and owed under the Amended Note using a portion of the proceeds from the Term Loan (as defined below) and entered into a Letter Agreement, dated as of September 20, 2023 with Delta, which terminated the Amended Note and released all liens and guarantees thereunder in connection with such repayment. The repayment of all amounts due and owed under the Amended Note was accounted for as a debt extinguishment, and no gain or loss was recognized. Term Loan and Revolving Credit Facility On September 20, 2023 (the “Credit Agreement Closing Date”), the Company entered into a Credit Agreement (the “Credit Agreement”), by and among the Company, as borrower, certain subsidiaries of the Company as guarantors (collectively with the Company, the “Loan Parties”), Delta, CK Wheels LLC (“CK Wheels”), and Cox Investment Holdings, Inc. (“CIH” and collectively with Delta and CK Wheels, the “Lenders”), and U.S. Bank Trust Company, N.A., as administrative agent for the Lenders and as collateral agent for the secured parties, pursuant to which (i) the Lenders provided a term loan facility (the “Term Loan”) in the aggregate original principal amount of $350.0 million and (ii) Delta provided commitments for a revolving loan facility (the “Revolving Credit Facility”) in the aggregate original principal amount of $100.0 million. On September 20, 2023, the Company issued the Term Loan of $350.0 million to the Lenders for net proceeds (before transaction-related expense) of $343.0 million. Pursuant to the Credit Agreement, the Company, with the consent of Delta and CK Wheels, may request the establishment of new term loan commitments (each, an “Incremental Term Loan”) after the Credit Agreement Closing Date in an aggregate principal amount up to $50.0 million, subject to certain limitations and requirements. Any additional lender providing an Incremental Term Loan after the Credit Agreement Closing Date in accordance with the Credit Agreement will join the Credit Agreement. The scheduled maturity date for the Term Loan is September 20, 2028, and the scheduled maturity date for the Revolving Credit Facility is the earlier of September 20, 2028 and the first date after September 20, 2025 on which all amounts owed with respect to borrowings under the Revolving Credit Facility have been repaid (in each case, as applicable, the “Maturity Date”), subject in each case to earlier termination upon acceleration or termination of any obligations upon the occurrence and continuation of an event of default. Interest on the Term Loan and any borrowings under the Revolving Credit Facility (each, a “Loan” and collectively, the “Loans”) accrues at a rate of 10% per annum on the unpaid principal balance of the Loans then outstanding. Accrued interest on each Loan is payable in kind as compounded interest and capitalized to the principal amount of the applicable Loan on the last day of each of March, June, September and December, and the Maturity Date. If in the future the Company or its subsidiaries either redeem in full the outstanding Equipment Notes or commence payoff at maturity thereof, the Company may elect to make interest payments (or some portion thereof) on any Loans then outstanding in cash. If the Company does not consummate the Deferred Issuance (as defined in Note 10 below) by January 18, 2024, the interest rate on the Term Loan will be increased to 20% per annum until such time that such Deferred Issuance is consummated. Also, upon the occurrence and during the continuance of an event of default under the Credit Agreement, (y) interest will accrue on the unpaid principal balance of the Loans at the rate then applicable to such Loans plus 2% and (z) interest will accrue on all other outstanding liabilities, interest, expenses, fees and other sums under the Credit Agreement, at a rate equal to the Alternate Base Rate (as defined in the Credit Agreement) plus 2% per annum. The Credit Agreement also contains certain covenants and events of default, in each case customary for transactions of this type. The obligations under the Credit Agreement are secured by a first-priority lien on unencumbered assets of the Loan Parties (excluding certain accounts, including any segregated account exclusively holding customer deposits, and other assets specified in the Credit Agreement), as well as a junior lien on the Equipment Note Collateral. The Credit Agreement is initially guaranteed by all U.S. and certain non-U.S. direct and indirect subsidiaries of the Company. In the future, the Company may be required to add any new or after-acquired subsidiaries of the Company that meet certain criteria as guarantors. In connection with the transactions contemplated by the Credit Agreement, the Company entered into an Investment and Investor Rights Agreement on September 20, 2023 (the “Investor Rights Agreement”), by and among the Company and the Lenders. Pursuant to the Investor Rights Agreement, the Company issued the Lenders 141,313,671 shares in the aggregate (the “Initial Shares”) of Common Stock in a private placement that closed after the end of the trading day on September 20, 2023, which represented approximately 80% of the Company’s issued and outstanding shares of Common Stock on a fully diluted basis as of September 15, 2023 (the “Initial Issuance”). The Initial Shares were issued such that each Lender received a pro rata portion of the Initial Shares equal to the proportion of its participation in the Term Loan as of the Credit Agreement Closing Date. Additionally, the Company agreed to issue an additional 529,926,270 shares in the aggregate (the “Deferred Shares” and, together with the Initial Shares, the “Investor Shares”) of Common Stock, which together with the Initial Shares will represent approximately 95% of the Company’s issued and outstanding shares of Common Stock on a fully diluted basis as of September 15, 2023 (the “Deferred Issuance”). The Deferred Issuance is contingent upon, and the Deferred Shares are expected to be issued to the Lenders (and any additional lender permitted pursuant to the Credit Agreement) after, the receipt of stockholder approval of an amendment to the Company’s Certificate of Incorporation to increase the number of shares of Common Stock authorized for issuance thereunder (the “Authorized Shares Amendment”) at a special meeting of the Company’s stockholders expected to be held on November 9, 2023 (the “Special Meeting”). The Investor Shares will be issued in a private placement such that upon completion of the Deferred Issuance, if at all, each Lender (or any additional lender permitted pursuant to the Credit Agreement) will have been issued a pro rata portion of the Investor Shares equal to the proportion of its participation in the Term Loan, together with any additional term loan issued prior to or concurrently with the Deferred Issuance. The Investor Rights Agreement also contains certain other terms and conditions related to the Lenders’ ownership of Common Stock, including, among other things, that the Lenders have the right to designate certain members of the Board depending on the level of Common Stock ownership and certain transfer restrictions and liquidity rights. In accordance with ASC 470, Debt , the value of the Term Loan, Initial Issuance, and Deferred Issuance was allocated using a relative fair value allocation. We evaluated features of the three instruments in accordance with ASC 480, Distinguishing Liabilities from Equity , and ASC 815, Derivatives and Hedging . The Company determined that the Term Loan, Initial Issuance and Deferred Issuance did not contain any features that would qualify as a derivative or embedded derivative and require bifurcation. In addition, the Company determined the Initial Issuance and Deferred Issuance should be classified as equity. The allocation on a relative fair value basis resulted in gross amounts recorded of $44.9 million for the Term Loan, $64.2 million for the Initial Issuance and $240.9 million for the Deferred Issuance. The fair value of debt was principally based on inputs such as estimated credit risk, recently completed market transactions and estimates based on interest rates, maturities, credit risk and underlying collateral. These inputs are primarily classified as Level 3 within the ASC 820 fair value hierarchy. The fair value of the Initial Issuance and Deferred Issuance were based on the quoted market prices of Common Stock, which represent Level 1 within the ASC 820 fair value hierarchy given these issuances were announced and known by the public. Issuance costs of $26.6 million were incurred in connection with the Credit Agreement and Investor Rights Agreement. The deferred issuance costs were allocated on a relative fair value basis, resulting in an allocation of $3.4 million for the Term Loan, $4.9 million for the Initial Issuance, and $18.3 million for the Deferred Issuance. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability, an exit price, in an orderly transaction between unaffiliated willing market participants on the measurement date under current market conditions. Assets and liabilities recorded at fair value are measured and classified in accordance with a three-tier fair value hierarchy based on the observability of the inputs available and activity in the markets used to measure fair value. A financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Level 1 - Quoted prices, unadjusted, in active markets for identical assets or liabilities that can be accessed at the measurement date. Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 - Unobservable inputs developed using our own estimates and assumptions, which reflect those that market participants would use in pricing the asset or liability. Financial instruments that are measured at fair value on a recurring basis and their corresponding placement in the fair value hierarchy consisted of the following (in thousands): September 30, 2023 Level 1 Level 2 Level 3 Fair Value Assets: Money market funds $ 89 $ — $ — 89 Total assets $ 89 $ — $ — $ 89 Liabilities: Warrant liability - Public Warrants $ 42 $ — $ — $ 42 Warrant liability - Private Warrants — 24 — 24 Equipment Notes — — 269,801 269,801 Term loan $ — $ — 268,400 $ 268,400 Total liabilities $ 42 $ 24 $ 538,201 $ 538,267 December 31, 2022 Level 1 Level 2 Level 3 Fair Value Assets: Money market funds $ 230,626 $ — $ — $ 230,626 Treasury bills 199,700 — — 199,700 Total assets $ 430,326 $ — $ — $ 430,326 Liabilities: Warrant liability - Public Warrants $ 479 $ — $ — $ 479 Warrant liability - Private Warrants — 272 — 272 Equipment Notes — 270,000 — 270,000 Total liabilities $ 479 $ 270,272 $ — $ 270,751 The carrying amount of cash equivalents approximates fair value and is classified within Level 1, because we determined the fair value through quoted market prices. The estimated fair value of the Equipment Notes is categorized as a Level 3 valuation. We considered the appraised value of aircraft subject to first-priority liens under the Equipment Notes, as sourced during the third quarter of 2023 and as required under the Equipment Notes, to determine the fair value of the Equipment Notes as of September 30, 2023. The estimated fair value of the Term Loan is categorized as a Level 3 valuation. The estimated fair value as of the issuance date was principally based on inputs such as estimated credit risk, recently completed transactions and estimates based on interest rates, maturities, credit risk and underlying collateral. We considered the relatively short time period between the issuance of the Term Loan and the measurement date of September 30, 2023, in order to determine the fair value of the Term Loan as of September 30, 2023. The Warrants (as defined below) were accounted for as a liability in accordance with Accounting Standards Codification 815-40 (see Note 12). The warrant liability was measured at fair value upon assumption and on a recurring basis, with changes in fair value presented in the condensed consolidated statements of operations. As of each of September 30, 2023 and December 31, 2022, we used Level 1 inputs for the Public Warrants (as defined below) and Level 2 inputs for the Private Warrants (as defined below). We valued the Private Warrants by applying the valuation technique of a Monte Carlo simulation model to reflect the redemption conditions. The Private Warrants are substantially similar to the Public Warrants, but are not directly traded or quoted on an active trading market. See Note 12 for additional information about the Warrants. The following table presents the changes in the fair value of the warrant liability (in thousands): Public Warrants Private Warrants Total Warrant Liability Fair value as of December 31, 2022 $ 479 $ 272 $ 751 Change in fair value of warrant liability (437) (248) (685) Fair value as of September 30, 2023 $ 42 $ 24 $ 66 |
LEASES
LEASES | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
LEASES | LEASES Leases primarily pertain to certain controlled aircraft and our corporate headquarters and operational facilities, including aircraft hangars, which are all accounted for as operating leases. We sublease an aircraft hangar at Cincinnati/Northern Kentucky International Airport from Delta. Certain of these operating leases have renewal options to further extend for additional time periods at our discretion. Our leases do not contain residual value guarantees, covenants or other associated restrictions. We have certain variable lease agreements with aircraft owners that contain payment terms based on an hourly lease rate multiplied by the number of flight hours during a month. Variable lease payments are not included in the right-of-use asset and lease liability balances but rather are expensed as incurred. The components of net lease cost were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Operating lease costs $ 9,313 $ 9,789 $ 30,648 $ 28,614 Short-term lease costs 2,039 8,086 6,676 22,600 Variable lease costs 10,519 3,563 25,018 12,516 Total lease costs $ 21,871 $ 21,438 $ 62,342 $ 63,730 Lease costs related to leased aircraft and operational facilities are included in cost of revenue in the condensed consolidated statements of operations. Lease costs related to our leased corporate headquarters and other office space, including expenses for non-lease components, are included in General and administrative expense in the condensed consolidated statements of operations. Sublease income is presented in General and administrative expense in the condensed consolidated statements of operations. Sublease income was not material for any of the three and nine month periods ended September 30, 2023 and 2022. Supplemental cash flow information related to leases were as follows (in thousands): Nine Months Ended September 30, 2023 2022 Cash paid for amounts included in the measurement of operating lease liabilities: Operating cash flows paid for operating leases $ 28,318 $ 28,865 Right-of-use assets obtained in exchange for operating lease obligations $ 5,742 $ 46,916 Supplemental balance sheet information related to leases were as follows: September 30, 2023 December 31, 2022 Weighted-average remaining lease term (in years): Operating leases 6.7 5.9 Weighted-average discount rate: Operating leases 9.1 % 9.0 % Maturities of lease liabilities, as of September 30, 2023, were as follows (in thousands): Year ending December 31, Operating Leases 2023 (remaining) $ 8,159 2024 28,522 2025 16,993 2026 9,826 2027 7,520 2028 and Thereafter 43,090 Total lease payments 114,110 Less: Imputed interest (31,561) Total lease obligations $ 82,549 |
STOCKHOLDER_S EQUITY AND EQUITY
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION | STOCKHOLDERS’ EQUITY AND EQUITY-BASED COMPENSATION Stockholders’ Equity Authorized Shares Pursuant to the Wheels Up Experience Inc. certificate of incorporation, as amended, and after giving effect to the Authorized Share Reduction that became effective on June 7, 2023, we are authorized to issue 250,000,000 shares of Common Stock, and 25,000,000 shares of preferred stock, $0.0001 par value per share. Holders of Common Stock are entitled to one vote per share; provided, that (i) CK Wheels LLC may not vote more than 19.9% of the Company’s issued and outstanding Common Stock as a result of restrictions on voting imposed under applicable regulatory provisions and (ii) by agreement with Delta, any shares owned by Delta above 29.9% will be neutral shares with respect to voting rights, voted in proportion to all other votes cast (“for”, “against” or “abstain”) at a meeting of stockholders other than by Delta. Reverse Stock Split Following approval by the Company’s stockholders at the Company’s 2023 Annual Meeting of Stockholders held on May 31, 2023, the Board of Directors of the Company (the “Board”) approved the Reverse Stock Split of Wheels Up’s outstanding shares of Common Stock, at a reverse stock split ratio of 1-for-10 and contemporaneously with the Reverse Stock Split, the Authorized Share Reduction, which provided for a proportionate reduction in the number of authorized shares of Common Stock from 2.5 billion shares of Common Stock to 250 million shares, each of which became effective immediately after the close of trading on the NYSE on June 7, 2023. The Company’s total stockholders’ equity, in the aggregate, did not change as a result of the Reverse Stock Split and Authorized Share Reduction. In addition, the par value for the Company’s Common Stock remained unchanged. Holders of Common Stock who would otherwise have held fractional shares because the number of shares of Common Stock they held before the Reverse Stock Split was not evenly divisible by the reverse stock split ratio received cash (without interest, and subject to any required tax withholding applicable to a holder) in lieu of issuance of such fractional shares. As a result of the Reverse Stock Split, equitable adjustments corresponding to the reverse stock split ratio were made to the number of shares of Common Stock underlying Wheels Up’s outstanding equity awards and the number of shares issuable under Wheels Up’s equity incentive plans, as well as any exercise prices, hurdle amounts or market-based vesting conditions of such equity awards, as applicable. In addition, equitable adjustments corresponding to the reverse stock split ratio of 1-for-10 were made to the Warrants (as defined below), resulting in each Warrant becoming exercisable for 1/10th of one share of Common Stock at an exercise price of $115.00 per whole share of Common Stock and the stated redemption prices per Warrant being proportionately reduced (see Note 12). Initial Issuance & Deferred Issuance In connection with the transactions contemplated by the Credit Agreement, the Company entered into the Investor Rights Agreement on September 20, 2023. Pursuant to the Investor Rights Agreement, the Company issued the Lenders 141,313,671 Initial Shares in a private placement that closed after the end of the trading day on the Credit Agreement Closing Date, which represented approximately 80% of the Company’s issued and outstanding shares of Common Stock on a fully diluted basis. The Initial Shares were issued such that each Lender received a pro rata portion of the Initial Shares equal to the proportion of its participation in the Term Loan as of the Credit Agreement Closing Date. The amount recorded for the Initial Issuance was determined using the relative fair value basis, which resulted in allocated gross proceeds of $64.2 million for the Initial Issuance. Issuance costs of $4.9 million were recorded as a reduction to Additional paid-in capital. Additionally, the Company agreed to issue an additional 529,926,270 Deferred Shares. The Deferred Issuance is contingent upon, and the Deferred Shares are expected to be issued to the Lenders (and any additional lender permitted pursuant to the Credit Agreement) after, the receipt of stockholder approval of the Authorized Shares Amendment at the Special Meeting. The Investor Shares will be issued in a private placement such that upon completion of the Deferred Issuance, if at all, each Lender (and any additional lender permitted pursuant to the Credit Agreement) will have been issued a pro rata portion of the Investor Shares equal to the proportion of its participation in the Term Loan, together with any additional term loan issued prior to or concurrently with the Deferred Issuance. The Company recorded the Deferred Issuance as a forward contract for Common Stock within Additional paid-in capital on the balance sheet. The amount recorded for the Deferred Issuance was determined using the relative fair value basis, which resulted in allocated gross proceeds of $240.9 million for the Deferred Issuance. Issuance costs of $18.3 million were recorded as a reduction to Additional paid-in capital. Equity-Based Compensation As of September 30, 2023, we have nine equity-based compensation plans that were approved by the board of directors of WUP LLC (collectively the “WUP Management Incentive Plan”) prior to the Business Combination (as defined below), as well as the Wheels Up Partners Holdings LLC Option Plan (the “WUP Option Plan”). Following the consummation of the Business Combination (as defined below), no new grants can be made under the WUP Management Incentive Plan or WUP Option Plan. In connection with the Business Combination (as defined below), the Board and stockholders of Wheels Up adopted the Wheels Up Experience Inc. 2021 Long-Term Incentive Plan (the “Original 2021 LTIP”), for employees, consultants and other qualified persons. Following approval by the Board, at the Annual Meeting, the Company’s stockholders approved the Amended and Restated Wheels Up Experience Inc. 2021 Long-Term Incentive Plan (the “Amended and Restated 2021 LTIP”) to increase the aggregate number of shares of Common Stock available for awards made thereunder by 24,150,000 shares (2,415,000 shares after giving effect to the Reverse Stock Split) and amend certain other plan provisions. On June 30, 2022, the Board adopted the Wheels Up Experience Inc. 2022 Inducement Grant Plan (the “2022 Inducement Plan”) to be used for a one-time employment inducement grant, pursuant to NYSE Rule 303A.08, for Todd Smith, in connection with his appointment to Chief Financial Officer. The maximum number of awards that could be granted under the 2022 Inducement Plan were 2,051,282 shares of Common Stock (205,128 shares of Common Stock after giving effect to the Reverse Stock Split), which were all granted in the form of restricted stock units (“RSUs”) to Mr. Smith on July 1, 2022. Restricted stock unit awards granted under the 2022 Inducement Grant Plan contain generally the same terms as other awards granted under the Original 2021 LTIP during the fiscal year ended December 31, 2022. WUP Management Incentive Plan As of September 30, 2023, an aggregate of 3.1 million WUP profits interests have been authorized and issued under the WUP Management Incentive Plan. Vested WUP profits interests are eligible to be exchanged into shares of Common Stock. Amounts of WUP profits interests reported in the tables below represent the maximum number of WUP profits interests outstanding or that could be realized upon vesting and immediately exchanged for the maximum number of shares of Common Stock. The actual number of shares of Common Stock received upon exchange of such WUP profits interests will depend on the trading price per share of Common Stock at the time of such exchange. The following table summarizes the WUP profits interests activity under the WUP Management Incentive Plan as of September 30, 2023: Number of WUP Weighted-Average Grant (in thousands) Outstanding WUP profits interests as of January 1, 2023 2,881 $ 4.16 Granted — — Exchanged — — Expired/forfeited — — Outstanding WUP profits interests as of September 30, 2023 2,881 $ 4.16 The weighted-average remaining contractual term as of September 30, 2023, for WUP profits interests outstanding was approximately 7.8 years. The following table summarizes the status of non-vested WUP profits interests as of September 30, 2023: Number of WUP Weighted-Average Grant (in thousands) Non-vested WUP profits interests as of January 1, 2023 170 $ 4.19 Granted — — Vested (170) 4.19 Forfeited — — Non-vested WUP profits interests as of September 30, 2023 — $ — WUP Option Plan As of September 30, 2023, the number of WUP stock options authorized and issued in the aggregate under the WUP Option Plan was 1.8 million. Each outstanding stock option is exercisable for one share of Common Stock. The following table summarizes the activity under the WUP Option Plan as of September 30, 2023: Number of WUP Weighted- Weighted-Average Grant (in thousands) Outstanding WUP stock options as of January 1, 2023 1,280 $ 75.10 $ 12.02 Granted — — — Exercised — — — Forfeited (78) 71.63 7.34 Expired (10) 72.71 6.74 Outstanding WUP stock options as of September 30, 2023 1,192 $ 75.35 $ 12.38 Exercisable WUP stock options as of September 30, 2023 1,192 $ 75.35 $ 12.38 The aggregate intrinsic value as of September 30, 2023, for WUP stock options that were outstanding and exercisable was nil . The weighted-average remaining contractual term as of September 30, 2023, for WUP stock options that were outstanding and exercisable was approximately 5.8 years. The following table summarizes the status of non-vested WUP stock options as of September 30, 2023: Number of WUP Stock Options Weighted-Average Grant (in thousands) Non-vested WUP stock options as of January 1, 2023 104 $ 19.95 Granted — — Vested (102) 20.03 Expired — — Forfeited (2) 16.01 Non-vested WUP stock options as of September 30, 2023 — $ — Amended and Restated 2021 LTIP As of September 30, 2023, an aggregate of 5.2 million shares were authorized for issuance under the Amended and Restated 2021 LTIP. Restricted Stock Units The following table summarizes the activity under the Amended and Restated 2021 LTIP related to RSU s as of September 30, 2023: Number of RSUs (1) Weighted-Average Grant (in thousands) Non-vested RSUs as of January 1, 2023 1,617 $ 34.64 Granted 2,297 2.69 Vested (584) 35.25 Forfeited (649) 22.28 Non-vested RSUs as of September 30, 2023 2,681 $ 10.12 (1) RSU awards granted under the 2022 Inducement Grant Plan contain generally the same terms as other RSU awards granted under the Original 2021 LTIP during the fiscal year ended December 31, 2022. The number of RSUs and weighted-average grant date fair value include 205,128 RSUs granted under the 2022 Inducement Grant Plan in July 2022, of which 68,376 RSUs had vested as of January 1, 2023 and the remaining 136,752 RSUs are scheduled to vest in equal installments on December 30, 2023 and December 30, 2024, subject to continued service through each such vesting date. The total unrecognized compensation cost related to non-vested RSUs was $20.5 million as of September 30, 2023 and is expected to be recognized over a weighted-average period of 1.6 years. Performance-Based Restricted Stock Units (“PSUs”) Under the terms of the PSUs granted to certain employees, upon the achievement of certain pre-determined performance objectives, each PSU may settle into shares of our Common Stock. The PSUs will vest, if at all, upon the actual achievement of the related performance objectives, subject to specified change of control exceptions. The following table summarizes the activity under the Amended and Restated 2021 LTIP related to PSUs as of September 30, 2023: Number of PSUs Weighted-Average Grant (in thousands) Non-vested PSUs as of January 1, 2023 96 $ 21.68 Granted 145 2.93 Vested (32) 12.19 Forfeited (44) 15.19 Non-vested PSUs as of September 30, 2023 (1) 165 $ 8.71 (1) Non-vested PSUs reflected in the table above include approximately 84 thousand of PSUs that may settle in shares of our Common Stock equal to 0-120% of the PSUs and 106 thousand PSUs that may settle into shares of Common Stock equal to 0-200% of the PSUs, in each case based on the level of performance. Compensation expense associated with PSUs is recognized over the vesting period of the awards that are ultimately expected to vest when the achievement of the related performance objectives becomes probable. As of September 30, 2023, the achievement of the performance objectives associated with certain non-vested PSUs was deemed not probable of being achieved and, accordingly, $0.3 million of compensation cost has not been recognized. RSUs Subject to Market-Based Vesting Conditions (“Market-Based RSUs”) The Company previously granted Market-Based RSUs to certain employees, pursuant to the terms of which each Market-Based RSU was settleable into shares of Common Stock. The Market-Based RSUs were subject to vesting, if at all, based on the closing trading price per share of our Common Stock over any 30 consecutive trading day-period that occurred prior to the end date specified in the underlying award agreement, subject to continued service through each such vesting date. Based on the Common Stock trading price, the market conditions for the outstanding Market-Based RSUs were not met, and no shares vested as of June 30, 2023. All outstanding unvested Market-Based RSUs were forfeited and cancelled during the three months ended June 30, 2023. Wheels Up Stock Options The following table summarizes the activity under the Amended and Restated 2021 LTIP related to Wheels Up stock options as of September 30, 2023: Number of Wheels Up Weighted- Weighted-Average Grant (in thousands) Outstanding Wheels Up stock options as of January 1, 2023 77 $ 100.00 $ 47.52 Granted — — — Exercised — — — Forfeited — — — Expired — — — Outstanding Wheels Up stock options as of September 30, 2023 77 $ 100.00 $ 47.52 Exercisable Wheels Up stock options as of September 30, 2023 77 $ 100.00 $ 47.52 The aggregate intrinsic value as of September 30, 2023, for Wheels Up stock options that were outstanding and exercisable was nil . The weighted-average remaining contractual term as of September 30, 2023, for Wheels Up stock options that were outstanding and exercisable was approximately 4.1 years. All Wheels Up stock options vested in prior periods. Equity-Based Compensation Expense Compensation expense for WUP profits interests recognized in the condensed consolidated statements of operations was nominal and $0.2 million for the three months ended September 30, 2023 and September 30, 2022, respectively, and $0.1 million and $1.1 million for the nine months ended September 30, 2023 and 2022, respectively. Compensation expense for WUP restricted interests recognized in the condensed consolidated statements of operations was nil for each of the three months ended September 30, 2023 and 2022, and nil and $0.4 million for the nine months ended September 30, 2023 and 2022, respectively. Compensation expense for WUP stock options under the WUP Option Plan and Wheels Up stock options under the Amended and Restated 2021 LTIP recognized in the condensed consolidated statements of operations was $0.2 million and $1.3 million for the three months ended September 30, 2023 and 2022, respectively, and $1.1 million and $5.5 million for the nine months ended September 30, 2023 and 2022, respectively. Compensation expense for RSUs and PSUs recognized in the condensed consolidated statements of operations was $3.3 million and $11.2 million for the three months ended September 30, 2023 and 2022, respectively, and $15.2 million and $29.9 million for the nine months ended September 30, 2023 and 2022, respectively. The following table summarizes equity-based compensation expense recognized by condensed consolidated statement of operations line item (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Cost of revenue $ 826 $ 3,581 $ 3,097 $ 11,320 Technology and development 620 751 1,777 2,047 Sales and marketing 440 2,756 1,781 8,314 General and administrative 1,622 15,416 14,995 44,158 Total equity-based compensation expense $ 3,508 $ 22,504 $ 21,650 $ 65,839 Earnout Shares On July 13, 2021 (the “Business Combination Closing Date”), we consummated the transactions contained in the Agreement and Plan of Merger with Aspirational Consumer Lifestyle Corp. (“Aspirational”), a blank check company, dated as of February 1, 2021, as amended on May 6, 2021 (the “Business Combination”). As part of the Business Combination, existing holders of WUP equity, including certain holders of WUP profits interests and restricted interests, but excluding holders of WUP stock options, have the right to receive up to an aggregate of 0.9 million additional shares of our Common Stock in three equal tranches, which are issuable upon the achievement of share price thresholds of $125.00, $150.00 and $175.00 for any 20 trading days within a period of 30 consecutive trading days on or before July 13, 2026, respectively (the “Earnout Shares”). Earnout Shares are not attributable to any equity-based compensation plan. Earnout Shares are attributable to vested WUP profits interests and restricted interests as of the date each of the Earnout Share market conditions are met. No Earnout Shares have been issued as of September 30, 2023. The grant-date fair value of the Earnout Shares attributable to the holders of WUP profits interests and restricted interests, using a Monte Carlo simulation model, was $57.9 million. The derived service period began on the Closing Date and had a weighted-average period of 1.7 years. Based on the Common Stock trading price, the market conditions were not met, and no Earnout Shares vested as of September 30, 2023. Compensation expense for Earnout Shares recognized in the condensed consolidated statements of operations was nil and $9.7 million for the three months ended September 30, 2023 and 2022, respectively, and $1.4 million and $28.8 million for the nine months ended September 30, 2023 and 2022, respectively. Treasury Stock As of September 30, 2023, we had 275,707 shares of treasury stock. The increase in treasury stock during the nine months ended September 30, 2023 reflects shares of Common Stock withheld to settle employee taxes due upon the vesting of RSUs as well as shares of Common Stock acquired from stockholders who would otherwise have held fractional shares because the number of shares of Common Stock they held before the Reverse Stock Split was not evenly divisible by the reverse stock split ratio, which the Company acquired for cash (without interest, and subject to any required tax withholding applicable to a holder) in lieu of issuance of such fractional shares of Common Stock. |
WARRANTS
WARRANTS | 9 Months Ended |
Sep. 30, 2023 | |
Warrants and Rights Note Disclosure [Abstract] | |
WARRANTS | WARRANTSPrior to the Business Combination, Aspirational issued 7,991,544 redeemable public warrants (“Public Warrants”) and 4,529,950 redeemable private warrants (“Private Warrants” and together with the Public Warrants, the “Warrants”). On the Business Combination Closing Date, Wheels Up assumed the Warrants. Each whole Warrant entitles the holder to purchase 1/10th share of Common Stock at a price of $115.00 per whole share of Common Stock. The Public Warrants and Private Warrants became exercisable on September 25, 2021, which was 12 months from the closing of the Aspirational initial public offering, and expire on July 13, 2026 or earlier upon redemption or liquidation. In connection with the Business Combination, we filed a Registration Statement on Form S-1 that was declared effective by the SEC on August 24, 2021, as amended by Post-Effective Amendment No. 1 thereto that was declared effective by the SEC on March 21, 2022, as further amended by Post-Effective Amendment No. 2 to Form S-1 on Form S-3 filed with the SEC on July 20, 2022, and as further amended by Post-Effective Amendment No. 3 to Form S-1 on Form S-3 that was declared effective by the SEC on August 10, 2022 (collectively, the “Selling Stockholder Registration Statement”). The Selling Stockholder Registration Statement relates to the issuance of an aggregate of 1,252,149 shares of Common Stock underlying the Public Warrants and Private Warrants. As of September 30, 2023, there have not been any warrants exercised and 12,521,494 remain outstanding. The Public Warrants were delisted from trading on the NYSE on July 17, 2023 and deregistered under the Exchange Act effective October 5, 2023. |
NON-CONTROLLING INTERESTS
NON-CONTROLLING INTERESTS | 9 Months Ended |
Sep. 30, 2023 | |
Noncontrolling Interest [Abstract] | |
NON-CONTROLLING INTERESTS | NON-CONTROLLING INTERESTS MIP LLC is a single purpose entity formed for the purpose of administering and effectuating the award of WUP profits interests to employees, consultants and other qualified persons. Wheels Up is the sole managing member of MIP LLC and, as a result, consolidates the financial results of MIP LLC. We record non-controlling interests representing the ownership interest in MIP LLC held by other members of MIP LLC. In connection with the Business Combination, the Seventh Amended and Restated LLC Agreement of WUP was adopted, allowing members of MIP LLC, subject to certain restrictions, to exchange their vested WUP profits interests for cash or a corresponding number of shares of Common Stock, at the option of Wheels Up, based on the value of such WUP profits interests relative to their applicable participation threshold. The decision of whether to exchange WUP profits interests for cash or Common Stock is made solely at the discretion of Wheels Up. Accordingly, the WUP profits interests held by MIP LLC are treated as permanent equity and changes in the ownership interest of MIP LLC are accounted for as equity transactions. Future exchanges of WUP profits interests, if settled in shares of Common Stock at the discretion of Wheels Up, will reduce the amount recorded as non-controlling interests and increase Additional paid-in-capital on the condensed consolidated balance sheets. The calculation of non-controlling interests was as follows: September 30, 2023 December 31, 2022 Number of WUP common units held by Wheels Up (1) 166,804,743 100.0 % 24,933,857 100.0 % Number of vested WUP profits interests attributable to non-controlling interests (2) — — % — — % Total WUP common units and vested WUP profits interests outstanding 166,804,743 100.0 % 24,933,857 100.0 % (1) WUP common units represent an equivalent ownership of Common Stock outstanding. (2) Based on the closing price of Common Stock on the last trading day of the period covered by this Quarterly Report, there would be no WUP common units issuable upon conversion of vested and unvested WUP profits interests outstanding as of September 30, 2023. Weighted-average ownership percentages are used to allocate net loss to Wheels Up and the non-controlling interest holders. The non-controlling interests weighted-average ownership percentage was 0.0% for each of the three and nine months ended ended September 30, 2023 and 2022. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Legal Proceedings We are party to various legal actions arising in the normal course of business. While we do not expect that the ultimate resolution of any of these pending actions will have a material effect on our consolidated results of operations, financial position, or cash flows, litigation is subject to inherent uncertainties. As such, there can be no assurance that any pending legal action, which we believe to be immaterial as of September 30, 2023, does not become material in the future. Sales and Use Tax Liability We regularly provide services to members in various states within the continental U.S., which may create sales and use tax nexus via temporary presence, potentially requiring the payment of these taxes. We determined that there is uncertainty as to what constitutes nexus in respective states for a state to levy taxes, fees and surcharges relating to our activity. As of September 30, 2023 and December 31, 2022, we estimated the potential exposure to such tax liability was $10.6 million and $10.4 million, respectively, the expense for which was included in accrued expenses on the condensed consolidated balance sheets and in cost of revenue in the condensed consolidated statements of operations as of and for the applicable periods presented. |
RELATED PARTIES
RELATED PARTIES | 9 Months Ended |
Sep. 30, 2023 | |
Related Party Transactions [Abstract] | |
RELATED PARTIES | RELATED PARTIES We engage in transactions with certain stockholders who are also members, ambassadors or customers. Such transactions primarily relate to their membership in the Wheels Up program, flights and flight-related services. We incurred expenses of $0.4 million and $1.5 million for the three and nine months ended September 30, 2023, respectively, and $0.1 million and $1.5 million for the three and nine months ended September 30, 2022, respectively, from transactions related to the CCA with Delta. As of September 30, 2023 and December 31, 2022, $0.4 million and $2.4 million, respectively, were included in Accrued expenses on the condensed consolidated balance sheets and $4.6 million and nil, respectively, were included in Other non-current liabilities on the condensed consolidated balance sheets related to transactions associated with the CCA with Delta. The Company completed certain financing transactions with Delta during the three months ended September 30, 2023, including the Amended Note, the Term Loan and the issuance of a portion of the Initial Shares to Delta, in each case in amounts equal to the amount of the Term Loan funded by Delta in relation to the total Term Loan funded on the Credit Agreement Closing Date. See Note 7, Long-Term Debt and Note 10, Stockholders Equity and Equity-Based Compensation Expense, for additional information about the Term Loan, Revolving Credit Facility and issuance of a portion of the Initial Shares to Delta during the three months ended September 30, 2023. |
RESTRUCTURING AND RELATED CHARG
RESTRUCTURING AND RELATED CHARGES | 9 Months Ended |
Sep. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING AND RELATED CHARGES | RESTRUCTURING AND RELATED CHARGES On March 1, 2023, we announced a restructuring plan (the “Restructuring Plan”) as part of our previously announced focus on implementing cost reductions and improving the efficiency of our operations, which consisted of a reduction in headcount (excluding pilots, maintenance and operations-support personnel). We estimated that we would incur approximately $14 million in total pre-tax charges in connection with the Restructuring Plan, primarily related to severance payments, employee benefits and equity-based compensation. As of September 30, 2023, we have incurred $17.7 million of charges associated with the Restructuring Plan related to severance payments, employee benefits and equity-based compensation, which represents all cash and non-cash charges expected under the Restructuring Plan. During the three months ended December 31, 2022, we recorded $7.2 million of expenses related to actions taken in the fourth quarter of 2022 and in connection with the Restructuring Plan. During the six months ended June 30, 2023, the remaining $10.5 million of expenses related to the Restructuring Plan were incurred and recorded in the Company’s condensed consolidated statement of operations, as follows (in thousands): Cost of revenue $ 755 Technology and development 2,299 Sales and marketing 2,058 General and administrative 5,408 Total restructuring expenses $ 10,520 |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES We are subject to U.S. federal, state and local income taxes with respect to our allocable share of any taxable income or loss from WUP, as well as any standalone income or loss Wheels Up generates. WUP is treated as a partnership for U.S. federal and most applicable state and local income tax purposes and generally does not pay income taxes in most jurisdictions. Instead, any taxable income or loss generated by WUP is passed through to and included in the taxable income or loss of its members, including Wheels Up. We are also subject to income taxes in the various foreign jurisdictions in which we operate. We recorded income tax expense of $0.6 million and $0.8 million for the three and nine months ended September 30, 2023, respectively, and income tax expense of $0.2 million and $0.5 million for the three and nine months ended September 30, 2022, respectively. The effective tax rate was (0.4)% and (0.2)% for the three and nine months ended September 30, 2023, respectively, and (0.1)% and (0.2)% for the three and nine months ended September 30, 2022, respectively. Our effective tax rate for the three and nine months ended September 30, 2023 differs from the federal statutory rate of 21%, primarily due to a full valuation allowance against the majority of our net deferred tax assets where it is more likely than not that the deferred tax assets will not be realized and geographical mix of our earnings. We currently expect the undistributed earnings of our foreign subsidiaries to be indefinitely reinvested. Accordingly, the Company has not provided for the tax effect, if any, of limited outside basis differences of its foreign subsidiaries. If these foreign earnings are repatriated to the U.S., or if the Company determines that such earnings are repatriated to the U.S., or if the Company determines that such earnings will be remitted in a future period, additional tax provisions may be required. We evaluate the realizability of our deferred tax assets on a quarterly basis and establish valuation allowances when it is more likely than not that all or a portion of the deferred tax assets may not be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, and tax-planning strategies. As of September 30, 2023, we concluded, based on the weight of all available positive and negative evidence, that it is more likely than not that the majority of U.S. deferred tax assets will not be realized. Accordingly, a valuation allowance has been established on the majority of our net deferred tax assets in the U.S. In general, under Section 382 of the Internal Revenue Code of 1986 (as amended, the “Code”), a corporation that undergoes an “ownership change” is subject to limitations on its ability to utilize its pre-change net operating losses or tax credits to offset future taxable income or taxes. As a result of the Initial Issuance, the Company experienced an ownership change during the third quarter of 2023, that will limit the availability of our tax attributes offset future income. A formal Section 382 analysis is being performed to determine the extent of the limitations. Our net operating losses and tax attributes are currently subject to a full valuation allowance. Accordingly, we do not believe it will have a material impact on our consolidated financial statements. Additionally, the Company is subject to the income tax effects associated with the Global Intangible Low-Taxed Income (“GILTI”) provisions and treats the tax effects of GILTI as a current period expense in the period incurred. |
NET LOSS PER SHARE
NET LOSS PER SHARE | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
NET LOSS PER SHARE | NET LOSS PER SHARE The following table sets forth the computation of basic and diluted net loss per share (in thousands, except per share data): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Numerator: Net loss attributable to Wheels Up Experience Inc. - basic and diluted $ (144,813) $ (148,838) $ (406,272) $ (330,250) Denominator: Weighted-average shares of Common Stock outstanding - basic and diluted 41,261,003 24,435,096 30,737,324 24,434,787 Basic and diluted net loss per share of Common Stock $ (3.51) $ (6.09) $ (13.22) $ (13.52) There were no dividends declared or paid during each of the three and nine months ended September 30, 2023 and 2022. Basic and diluted net loss per share were computed using the two-class method. Shares of unvested restricted stock are considered participating securities, because these awards contain a non-forfeitable right to participate equally in any dividends prior to forfeiture of the restricted stock, if any, irrespective of whether the awards ultimately vest. All issued and outstanding shares of restricted stock are included in the weighted-average shares of Common Stock outstanding for all periods presented. WUP profits interests held by other members of MIP LLC are not subject to the net loss per share calculation until such time the vested WUP profits interests are actually exchanged for shares of Common Stock. The following securities were not included in the computation of diluted shares outstanding, because the effect would be anti-dilutive, and issuance of such shares is contingent upon the satisfaction of certain conditions which were not satisfied by the end of the period: September 30, 2023 2022 Warrants (1) 1,252,149 1,252,149 Earnout Shares 900,000 900,000 RSUs (2) 3,109,823 2,432,789 Stock options 1,268,584 1,415,066 Total anti-dilutive securities 6,530,556 6,000,003 (1) Each Warrant entitles the holder to purchase 1/10th of one share of Common Stock at a price of $115.00 per whole share of Common Stock. (2) Includes total RSUs and PSUs outstanding as of September 30, 2023 and total RSUs, PSUs and Market-Based RSUs outstanding as of September 30, 2022. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS[PENDING] |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||||
Net Income (Loss) Attributable to Parent | $ (144,813) | $ (148,838) | $ (406,272) | $ (330,250) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 30, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
SUMMARY OF BUSINESS AND SIGNI_2
SUMMARY OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The condensed consolidated financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial reporting and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the financial information and footnotes required by U.S. GAAP for annual financial statements. In the opinion of the Company’s management, the condensed consolidated financial statements include all adjustments necessary for the fair presentation of the Company’s balance sheet as of September 30, 2023, its results of operations, including its comprehensive loss and stockholders' equity for the three months ended September 30, 2023 and 2022, and its results of operations, including its comprehensive loss and stockholders' equity and its cash flows for the nine months ended September 30, 2023 and 2022. All adjustments are of a normal recurring nature. The results for the three and nine months ended September 30, 2023 are not necessarily indicative of the results to be expected for any subsequent quarter or for the fiscal year ending December 31, 2023. Immediately after the close of business on the New York Stock Exchange (the “ NYSE”) on June 7, 2023, the reverse stock split of Wheels Up’s outstanding shares of Common Stock, at a reverse stock split ratio of 1-for-10 (the “Reverse Stock Split”) and contemporaneously with the Reverse Stock Split, a proportionate reduction in the number of authorized shares of Common Stock from 2.5 billion shares of Common Stock to 250 million shares (the “Authorized Share Reduction”). Accordingly, the presentation of all periods covered by the condensed consolidated financial statements contained herein have been adjusted to give retroactive effect to the Reverse Stock Split, including adjustments to per share net loss and other per share of Common Stock amounts. These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information. Consistent with these requirements, this Form 10-Q does not include all the information required by GAAP for complete financial statements. As a result, this Form 10-Q should be read in conjunction with the audited consolidated financial statements and related notes included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the Securities and Exchange Commission (the “SEC”) on March 31, 2023. Liquidity The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the ordinary course of business. Subsequent to August 14, 2023, we obtained funding as discussed in Note 7, Long-Term Debt , amended the Equipment Notes to reduce liquidity covenant requirements and divested the aircraft management business as discussed in Note 4, Acquisitions and Divestitures |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. We consolidate Wheels Up MIP LLC (“MIP LLC”) and record the profits interests held in MIP LLC that Wheels Up does not own as non-controlling interests (see Note 12). All intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates | Use of EstimatesPreparing the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates due to risks and uncertainties. The most significant estimates include, but are not limited to, the useful lives and residual values of purchased aircraft, the fair value of financial assets and liabilities, acquired intangible assets, goodwill, contingent consideration and other assets and liabilities, sales and use tax, the estimated life of member relationships, the determination of the allowance for credit losses, impairment assessments, the determination of the valuation allowance for deferred tax assets and the incremental borrowing rate for leases. |
Foreign Currency Translation Adjustments | Foreign Currency Translation Adjustments Assets and liabilities of foreign subsidiaries, where the functional currency is not the U.S. dollar, have been translated at period-end exchange rates and profit and loss accounts have been translated using weighted-average exchange rates. Adjustments resulting from currency translation have been recorded in the equity section of the condensed consolidated balance sheets and the condensed consolidated statements of other comprehensive loss as a cumulative translation adjustment. |
Impairment | Impairment During the second quarter of 2023, we determined that, because of continued negative cash flows and changes in our management and business strategy, there was an indication that the carrying value of the long-lived assets associated with the WUP Legacy reporting unit may not be recoverable. As a result, we performed an undiscounted cash flow analysis of our long-lived assets for potential impairment as of June 1, 2023. Based on the analysis, it was determined that there was no impairment to our long-lived assets. As a result of the aforementioned factors, we determined that there was an indication that it was more likely than not that the fair value of our WUP Legacy reporting unit was less than its carrying amount. We performed an interim quantitative impairment assessment of goodwill as of June 1, 2023. Using a discounted cash flow approach, we calculated the fair value of WUP Legacy based on the present value of estimated future cash flows. The significant underlying inputs used to measure the fair value included forecasted revenue growth rates and margins, weighted average cost of capital, normalized working capital level and projected long-term growth rates. As a result of this assessment, we recognized a goodwill impairment charge of $70.0 million relating to the WUP Legacy reporting unit during the three months ended June 30, 2023. The decline in the fair value of the reporting unit was primarily due to a more material reduction in working capital than expected during the three months ended June 30, 2023, as well as an increase in the discount rate. To facilitate reconciliation of the fair value of our reporting units to our market capitalization as of June 1, 2023, we elected to perform a quantitative impairment assessment of the Air Partner reporting unit as of June 1, 2023, using a combination of the discounted cash flow and guideline public company methods, which did not result in impairment to goodwill. Based on the valuation, the fair value of the Air Partner reporting unit exceeded its carrying value by more than 10%. During the third quarter of 2023, we determined that upon entering into the Term Loan and Revolving Credit Facility (as each is defined below) on September 20, 2023 (see Note 7), and due to associated changes to our ownership and governance structure on that same date (see Note 10), there was an indication that the fair value of the WUP Legacy reporting unit was less than its carrying amount. We performed an interim quantitative impairment assessment of goodwill as of September 20, 2023. Using a discounted cash flow approach, we calculated the fair value of WUP Legacy, based on the present value of estimated future cash flows. The significant underlying inputs used to measure the fair value included forecasted revenue growth rates and margins, weighted average cost of capital, normalized working capital level and projected long-term growth rates. As a result of this assessment, we recognized a goodwill impairment charge of $56.2 million relating to the WUP Legacy reporting unit during the three months ended September 30, 2023. The impairment charge represents the amount by which the carrying value of the reporting unit as of the assessment date exceeded the estimated fair value of the reporting unit as of the assessment date. Since the previous analysis on June 1, 2023, the fair value of the reporting unit increased as a result of the run-off of unprofitable periods in our estimated future cash flows; however, the carrying value of the reporting unit increased in a substantially equivalent amount due to the issuance of the Term Loan (see Note 7) and Initial Shares (as defined in Note 10). |
Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Effective | Adopted Accounting Pronouncements and Accounting Pronouncements Not Yet Effective There have been no recent accounting pronouncements, changes in accounting pronouncements or recently adopted accounting guidance during the three months ended September 30, 2023 that are of significance or potential significance to us. |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The following table disaggregates revenue by service type and the timing of when these services are provided to the member or customer (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Services transferred at a point in time: Flights, net of discounts and incentives $ 214,645 $ 278,917 $ 681,691 $ 799,351 Aircraft management 51,081 56,558 158,396 172,914 Other 29,720 58,728 89,665 121,695 Services transferred over time: Memberships 20,622 22,409 63,780 67,076 Aircraft management 2,154 2,404 7,035 7,272 Other 1,841 1,340 6,370 3,195 Total $ 320,063 $ 420,356 $ 1,006,937 $ 1,171,503 |
Schedule of Accounts Receivable Net | Accounts receivable, net consists of the following (in thousands): September 30, December 31, Gross receivables from members and customers $ 49,705 $ 112,243 Undeposited funds 5,304 10,122 Less: Allowance for credit losses (8,236) (9,982) Accounts receivable, net $ 46,773 $ 112,383 |
Schedule of Deferred Revenue | Deferred revenue consists of the following (in thousands): September 30, December 31, Flights - Prepaid Blocks $ 651,458 $ 1,023,985 Memberships - annual dues 35,935 43,970 Memberships - initiation fees 2,804 3,899 Flights - credits 1,773 4,246 Other 399 775 Deferred revenue - total 692,369 1,076,875 Less: Deferred revenue - current (691,214) (1,075,133) Deferred revenue - non-current $ 1,155 $ 1,742 Changes in deferred revenue for the nine months ended September 30, 2023 were as follows (in thousands): Deferred revenue as of December 31, 2022 $ 1,076,875 Amounts deferred during the period 342,923 Revenue recognized from amounts included in the deferred revenue beginning balance (571,211) Revenue from current period sales (156,218) Deferred revenue as of September 30, 2023 $ 692,369 |
Schedule of Revenue Expected to be Recognized in Future Periods | Revenue expected to be recognized in future periods for performance obligations that are unsatisfied, or partially unsatisfied, as of September 30, 2023 were as follows (in thousands): Remainder of 2023 $ 113,830 2024 292,149 2025 143,268 2026 143,122 Total $ 692,369 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment consist of the following (in thousands): September 30, 2023 December 31, 2022 Aircraft $ 509,984 $ 566,338 Software development costs 80,582 65,303 Leasehold improvements 22,274 11,930 Computer equipment 3,447 3,014 Buildings and improvements 1,424 1,424 Furniture and fixtures 4,311 3,208 Tooling 4,180 3,835 Vehicles 2,351 1,538 628,553 656,590 Less: Accumulated depreciation and amortization (266,500) (262,031) Total $ 362,053 $ 394,559 |
ACQUISITIONS AND DIVESTITURES (
ACQUISITIONS AND DIVESTITURES (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Preliminary Purchase Price Allocation | As of the date of acquisition, the total purchase price allocated to the Alante Air assets acquired and liabilities assumed according to their estimated fair values were as follows (in thousands): Current assets $ 4,452 Goodwill 13,069 Other assets 22,048 Total assets acquired 39,569 Total liabilities assumed (24,101) Net assets acquired $ 15,468 As of the date of acquisition, the total purchase price allocated to the Air Partner assets acquired and liabilities assumed according to their estimated fair values were as follows (in thousands): Current assets $ 49,617 Property and equipment, net 2,012 Operating lease right-of-use assets 2,780 Goodwill 83,910 Intangible assets 20,921 Restricted cash 27,507 Other assets 1,686 Total assets acquired 188,433 Total liabilities assumed (80,239) Net assets acquired $ 108,194 |
Schedule of Acquired Intangible Assets | The amounts allocated to acquired intangible assets and their associated weighted-average amortization periods, which were determined based on the period the assets are expected to contribute directly or indirectly to our cash flows, consisted of the following: Amount Weighted-Average Amortization Period Customer relationships $ 16,521 5.7 Backlog 1,458 1.5 Trade name 1,931 1.9 Developed technology 1,011 5.8 Total acquired intangible assets $ 20,921 5.1 |
Schedule of Unaudited Pro Forma Summary of Operations | The accompanying unaudited pro forma summary represents the consolidated results of operations as if the 2022 acquisitions of Alante Air and Air Partner had been completed as of January 1, 2022. The unaudited pro forma financial results for 2022 reflect the results for the three and nine months ended September 30, 2022, as well as the effects of pro forma adjustments for the transactions in 2022. The unaudited pro forma financial information includes the accounting effects of the acquisitions, including adjustments to the amortization of intangible assets and professional fees associated with the transactions. The pro forma results were based on estimates and assumptions, which we believe are reasonable but remain subject to adjustment. The unaudited pro forma summary does not necessarily reflect the actual results that would have been achieved had the companies been combined during the periods presented, nor is it necessarily indicative of future consolidated results (in thousands, except per share data). Nine Months Ended September 30, 2022 Net revenue $ 1,209,321 Net loss $ (266,628) Net loss attributable to Wheels Up Experience Inc. $ (266,628) Net loss per share (1) $ (10.98) (1) Adjusted for the impact of the Reverse Stock Split |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table presents goodwill carrying values and the change in balance, by reporting unit, during the nine months ended September 30, 2023 (in thousands): WUP Legacy Air Partner Total Balance as of December 31, 2022 (1) $ 270,467 $ 77,651 $ 348,118 Acquisitions (2) — 350 350 Impairment (3) (126,200) — (126,200) Divestitures (4) (8,169) — (8,169) Foreign currency translation adjustment — 708 708 Balance as of September 30, 2023 $ 136,098 $ 78,710 $ 214,808 (1) Net of accumulated impairment losses of $180 million, all of which was recognized on the goodwill attributable to the WUP Legacy reporting unit during the year ended December 31, 2022. (2) Reflects the current period impact of measurement period adjustments (See Note 4) (3) Impairment charge recognized during the second and third quarters of 2023 as a result of an interim quantitative assessments of goodwill as of June 1, 2023 and September 20, 2023, respectively (See Note 1) (4) Reflects the amount of goodwill allocated to the divestiture of the aircraft management business (See Note 4). |
Schedule of Intangible Assets | The gross carrying value, accumulated amortization and net carrying value of intangible assets consisted of the following (in thousands): September 30, 2023 Gross Carrying Accumulated Amortization Net Carrying Status $ 80,000 $ 29,644 $ 50,356 Customer relationships 89,121 32,226 56,895 Trade name 13,161 6,321 6,840 Developed technology 20,556 11,580 8,976 Leasehold interest - favorable 600 96 504 Backlog 1,458 1,313 145 Foreign currency translation adjustment (1,480) (547) (933) Total $ 203,626 $ 80,843 $ 122,783 December 31, 2022 Gross Carrying Accumulated Amortization Net Carrying Status $ 80,000 $ 23,644 $ 56,356 Customer relationships 91,121 24,613 66,508 Non-competition agreement 210 210 — Trade name 16,161 8,294 7,867 Developed technology 20,556 9,332 11,224 Leasehold interest - favorable 600 80 520 Backlog 1,458 880 578 Foreign currency translation adjustment (1,662) (374) (1,288) Total $ 208,444 $ 66,679 $ 141,765 |
Schedule of Intangible Liabilities | Associated with our acquisition of Delta Private Jets on January 17, 2020, we recognized intangible liabilities for the fair value of complimentary Connect Memberships provided to existing Delta SkyMiles 360 customers as of the acquisition date, as required under the Commercial Cooperation Agreement (as amended, the “CCA”) with Delta. The gross carrying value, accumulated amortization and net carrying value of intangible liabilities consisted of the following (in thousands): September 30, 2023 Gross Carrying Accumulated Amortization Net Carrying Intangible liabilities $ 20,000 $ 7,417 $ 12,583 December 31, 2022 Gross Carrying Accumulated Amortization Net Carrying Intangible liabilities $ 20,000 $ 5,917 $ 14,083 |
Schedule of Future Amortization Expense of Intangible Assets and Intangible Liabilities | Future amortization expense of intangible assets and intangible liabilities held as of September 30, 2023, were as follows (in thousands): Intangible Assets Intangible Liabilities Remainder of 2023 $ 5,865 $ 500 2024 22,759 2,000 2025 22,345 2,000 2026 21,486 2,000 2027 17,018 2,000 2028 and Thereafter 33,310 4,083 Total $ 122,783 $ 12,583 |
CASH EQUIVALENTS AND RESTRICT_2
CASH EQUIVALENTS AND RESTRICTED CASH (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Cash and Cash Equivalents [Abstract] | |
Schedule of Cash and Cash Equivalents | A reconciliation of cash and cash equivalents and restricted cash from the condensed consolidated balance sheets to the condensed consolidated statements of cash flows is as follows (in thousands): September 30, 2023 December 31, 2022 Cash and cash equivalents $ 244,847 $ 585,881 Restricted cash 29,315 34,272 Total $ 274,162 $ 620,153 |
Schedule of Restrictions on Cash and Cash Equivalents | A reconciliation of cash and cash equivalents and restricted cash from the condensed consolidated balance sheets to the condensed consolidated statements of cash flows is as follows (in thousands): September 30, 2023 December 31, 2022 Cash and cash equivalents $ 244,847 $ 585,881 Restricted cash 29,315 34,272 Total $ 274,162 $ 620,153 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The following table presents the components of long-term debt on our condensed consolidated balance sheets (in thousands): Weighted Average Interest Rate September 30, 2023 December 31, 2022 Equipment Notes 12.0 % $ 232,610 $ 270,000 Term Loan 10.0 % 350,972 — Total debt 583,582 270,000 Less: Total unamortized deferred financing costs and debt discount 322,926 16,760 Less: Current maturities of long-term debt 25,227 27,006 Long-term debt $ 235,429 $ 226,234 |
Schedule of Maturities of Long-Term Debt | Maturities of our principal debt payments for the next five years are as follows (in thousands): Maturities Remainder of 2023 $ 6,307 2024 25,227 2025 43,916 2026 38,907 2027 33,258 2028 and Thereafter 435,967 Total $ 583,582 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Instruments Measured at Fair Value on Recurring Basis | Financial instruments that are measured at fair value on a recurring basis and their corresponding placement in the fair value hierarchy consisted of the following (in thousands): September 30, 2023 Level 1 Level 2 Level 3 Fair Value Assets: Money market funds $ 89 $ — $ — 89 Total assets $ 89 $ — $ — $ 89 Liabilities: Warrant liability - Public Warrants $ 42 $ — $ — $ 42 Warrant liability - Private Warrants — 24 — 24 Equipment Notes — — 269,801 269,801 Term loan $ — $ — 268,400 $ 268,400 Total liabilities $ 42 $ 24 $ 538,201 $ 538,267 December 31, 2022 Level 1 Level 2 Level 3 Fair Value Assets: Money market funds $ 230,626 $ — $ — $ 230,626 Treasury bills 199,700 — — 199,700 Total assets $ 430,326 $ — $ — $ 430,326 Liabilities: Warrant liability - Public Warrants $ 479 $ — $ — $ 479 Warrant liability - Private Warrants — 272 — 272 Equipment Notes — 270,000 — 270,000 Total liabilities $ 479 $ 270,272 $ — $ 270,751 |
Schedule of Changes in Fair Value of Warrant Liability | The following table presents the changes in the fair value of the warrant liability (in thousands): Public Warrants Private Warrants Total Warrant Liability Fair value as of December 31, 2022 $ 479 $ 272 $ 751 Change in fair value of warrant liability (437) (248) (685) Fair value as of September 30, 2023 $ 42 $ 24 $ 66 |
LEASES (Tables)
LEASES (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Schedule of Components of Net Lease Cost | The components of net lease cost were as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Operating lease costs $ 9,313 $ 9,789 $ 30,648 $ 28,614 Short-term lease costs 2,039 8,086 6,676 22,600 Variable lease costs 10,519 3,563 25,018 12,516 Total lease costs $ 21,871 $ 21,438 $ 62,342 $ 63,730 |
Schedule of Supplemental Cash Flow Information | Supplemental cash flow information related to leases were as follows (in thousands): Nine Months Ended September 30, 2023 2022 Cash paid for amounts included in the measurement of operating lease liabilities: Operating cash flows paid for operating leases $ 28,318 $ 28,865 Right-of-use assets obtained in exchange for operating lease obligations $ 5,742 $ 46,916 |
Schedule of Supplemental Balance Sheet Information | Supplemental balance sheet information related to leases were as follows: September 30, 2023 December 31, 2022 Weighted-average remaining lease term (in years): Operating leases 6.7 5.9 Weighted-average discount rate: Operating leases 9.1 % 9.0 % |
Schedule of Maturities of Operating Leases | Maturities of lease liabilities, as of September 30, 2023, were as follows (in thousands): Year ending December 31, Operating Leases 2023 (remaining) $ 8,159 2024 28,522 2025 16,993 2026 9,826 2027 7,520 2028 and Thereafter 43,090 Total lease payments 114,110 Less: Imputed interest (31,561) Total lease obligations $ 82,549 |
STOCKHOLDER_S EQUITY AND EQUI_2
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Profits Interests Activity | The following table summarizes the WUP profits interests activity under the WUP Management Incentive Plan as of September 30, 2023: Number of WUP Weighted-Average Grant (in thousands) Outstanding WUP profits interests as of January 1, 2023 2,881 $ 4.16 Granted — — Exchanged — — Expired/forfeited — — Outstanding WUP profits interests as of September 30, 2023 2,881 $ 4.16 |
Schedule of Nonvested Profit Interests Activity | The following table summarizes the status of non-vested WUP profits interests as of September 30, 2023: Number of WUP Weighted-Average Grant (in thousands) Non-vested WUP profits interests as of January 1, 2023 170 $ 4.19 Granted — — Vested (170) 4.19 Forfeited — — Non-vested WUP profits interests as of September 30, 2023 — $ — |
Schedule of Stock Option Activity | The following table summarizes the activity under the WUP Option Plan as of September 30, 2023: Number of WUP Weighted- Weighted-Average Grant (in thousands) Outstanding WUP stock options as of January 1, 2023 1,280 $ 75.10 $ 12.02 Granted — — — Exercised — — — Forfeited (78) 71.63 7.34 Expired (10) 72.71 6.74 Outstanding WUP stock options as of September 30, 2023 1,192 $ 75.35 $ 12.38 Exercisable WUP stock options as of September 30, 2023 1,192 $ 75.35 $ 12.38 The following table summarizes the activity under the Amended and Restated 2021 LTIP related to Wheels Up stock options as of September 30, 2023: Number of Wheels Up Weighted- Weighted-Average Grant (in thousands) Outstanding Wheels Up stock options as of January 1, 2023 77 $ 100.00 $ 47.52 Granted — — — Exercised — — — Forfeited — — — Expired — — — Outstanding Wheels Up stock options as of September 30, 2023 77 $ 100.00 $ 47.52 Exercisable Wheels Up stock options as of September 30, 2023 77 $ 100.00 $ 47.52 |
Schedule of Nonvested Share Activity | The following table summarizes the status of non-vested WUP stock options as of September 30, 2023: Number of WUP Stock Options Weighted-Average Grant (in thousands) Non-vested WUP stock options as of January 1, 2023 104 $ 19.95 Granted — — Vested (102) 20.03 Expired — — Forfeited (2) 16.01 Non-vested WUP stock options as of September 30, 2023 — $ — |
Schedule of LTIP RSUs | The following table summarizes the activity under the Amended and Restated 2021 LTIP related to RSU s as of September 30, 2023: Number of RSUs (1) Weighted-Average Grant (in thousands) Non-vested RSUs as of January 1, 2023 1,617 $ 34.64 Granted 2,297 2.69 Vested (584) 35.25 Forfeited (649) 22.28 Non-vested RSUs as of September 30, 2023 2,681 $ 10.12 (1) RSU awards granted under the 2022 Inducement Grant Plan contain generally the same terms as other RSU awards granted under the Original 2021 LTIP during the fiscal year ended December 31, 2022. The number of RSUs and weighted-average grant date fair value include 205,128 RSUs granted under the 2022 Inducement Grant Plan in July 2022, of which 68,376 RSUs had vested as of January 1, 2023 and the remaining 136,752 RSUs are scheduled to vest in equal installments on December 30, 2023 and December 30, 2024, subject to continued service through each such vesting date. |
Schedule of Performance Stock Units | The following table summarizes the activity under the Amended and Restated 2021 LTIP related to PSUs as of September 30, 2023: Number of PSUs Weighted-Average Grant (in thousands) Non-vested PSUs as of January 1, 2023 96 $ 21.68 Granted 145 2.93 Vested (32) 12.19 Forfeited (44) 15.19 Non-vested PSUs as of September 30, 2023 (1) 165 $ 8.71 (1) Non-vested PSUs reflected in the table above include approximately 84 thousand of PSUs that may settle in shares of our Common Stock equal to 0-120% of the PSUs and 106 thousand PSUs that may settle into shares of Common Stock equal to 0-200% of the PSUs, in each case based on the level of performance. |
Schedule of Equity-based Compensation Expense | The following table summarizes equity-based compensation expense recognized by condensed consolidated statement of operations line item (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Cost of revenue $ 826 $ 3,581 $ 3,097 $ 11,320 Technology and development 620 751 1,777 2,047 Sales and marketing 440 2,756 1,781 8,314 General and administrative 1,622 15,416 14,995 44,158 Total equity-based compensation expense $ 3,508 $ 22,504 $ 21,650 $ 65,839 |
NON-CONTROLLING INTERESTS (Tabl
NON-CONTROLLING INTERESTS (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Noncontrolling Interest [Abstract] | |
Schedule of Calculation of Non-controlling Interests | The calculation of non-controlling interests was as follows: September 30, 2023 December 31, 2022 Number of WUP common units held by Wheels Up (1) 166,804,743 100.0 % 24,933,857 100.0 % Number of vested WUP profits interests attributable to non-controlling interests (2) — — % — — % Total WUP common units and vested WUP profits interests outstanding 166,804,743 100.0 % 24,933,857 100.0 % (1) WUP common units represent an equivalent ownership of Common Stock outstanding. |
RESTRUCTURING AND RELATED CHA_2
RESTRUCTURING AND RELATED CHARGES (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring and Related Costs | During the six months ended June 30, 2023, the remaining $10.5 million of expenses related to the Restructuring Plan were incurred and recorded in the Company’s condensed consolidated statement of operations, as follows (in thousands): Cost of revenue $ 755 Technology and development 2,299 Sales and marketing 2,058 General and administrative 5,408 Total restructuring expenses $ 10,520 |
NET LOSS PER SHARE (Tables)
NET LOSS PER SHARE (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Computation of Basic and Diluted Net Loss Per Share | The following table sets forth the computation of basic and diluted net loss per share (in thousands, except per share data): Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Numerator: Net loss attributable to Wheels Up Experience Inc. - basic and diluted $ (144,813) $ (148,838) $ (406,272) $ (330,250) Denominator: Weighted-average shares of Common Stock outstanding - basic and diluted 41,261,003 24,435,096 30,737,324 24,434,787 Basic and diluted net loss per share of Common Stock $ (3.51) $ (6.09) $ (13.22) $ (13.52) |
Schedule of Anti-dilutive Securities | The following securities were not included in the computation of diluted shares outstanding, because the effect would be anti-dilutive, and issuance of such shares is contingent upon the satisfaction of certain conditions which were not satisfied by the end of the period: September 30, 2023 2022 Warrants (1) 1,252,149 1,252,149 Earnout Shares 900,000 900,000 RSUs (2) 3,109,823 2,432,789 Stock options 1,268,584 1,415,066 Total anti-dilutive securities 6,530,556 6,000,003 (1) Each Warrant entitles the holder to purchase 1/10th of one share of Common Stock at a price of $115.00 per whole share of Common Stock. (2) Includes total RSUs and PSUs outstanding as of September 30, 2023 and total RSUs, PSUs and Market-Based RSUs outstanding as of September 30, 2022. |
SUMMARY OF BUSINESS AND SIGNI_3
SUMMARY OF BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Jun. 07, 2023 shares | Jun. 01, 2023 USD ($) | Sep. 30, 2023 USD ($) member shares | Jun. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) aircraft member shares | Sep. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) shares | Sep. 20, 2023 | Jun. 06, 2023 shares | |
Goodwill [Line Items] | ||||||||||
Marketplace base rate | member | 11,000 | 11,000 | ||||||||
Number of aircraft | aircraft | 1,500 | |||||||||
Reverse stock split ratio | 0.1 | |||||||||
Common stock authorized (in shares) | shares | 250,000,000 | 250,000,000 | 250,000,000 | 250,000,000 | 2,500,000,000 | |||||
Impairment of long-lived assets | $ 0 | |||||||||
Impairment of goodwill | $ 56,200,000 | $ 62,000,000 | $ 126,200,000 | $ 62,000,000 | ||||||
Percent of fair value of Air Partner reporting unit exceeded carrying value (more than) | 10% | 20% | ||||||||
WUP Legacy | ||||||||||
Goodwill [Line Items] | ||||||||||
Impairment of goodwill | $ 56,200,000 | $ 70,000,000 | $ 126,200,000 | $ 180,000,000 |
REVENUE RECOGNITION - Schedule
REVENUE RECOGNITION - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 320,063 | $ 420,356 | $ 1,006,937 | $ 1,171,503 |
Services transferred at a point in time: | Flights, net of discounts and incentives | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 214,645 | 278,917 | 681,691 | 799,351 |
Services transferred at a point in time: | Aircraft management | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 51,081 | 56,558 | 158,396 | 172,914 |
Services transferred at a point in time: | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 29,720 | 58,728 | 89,665 | 121,695 |
Services transferred over time: | Aircraft management | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 2,154 | 2,404 | 7,035 | 7,272 |
Services transferred over time: | Memberships | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 20,622 | 22,409 | 63,780 | 67,076 |
Services transferred over time: | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 1,841 | $ 1,340 | $ 6,370 | $ 3,195 |
REVENUE RECOGNITION - Narrative
REVENUE RECOGNITION - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Disaggregation of Revenue [Line Items] | |||||
Discounts and incentives | $ 2,700 | $ 2,700 | $ 6,700 | $ 9,400 | |
Revenue | 320,063 | 420,356 | 1,006,937 | 1,171,503 | |
Capitalized sales commission and referral fees | 1,900 | 3,300 | 6,000 | 12,600 | |
Amortization expense | 2,600 | 4,400 | 9,400 | 12,100 | |
Other | Whole Aircraft Sales | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue | 2,800 | 35,900 | 18,200 | 63,900 | |
Other | Group Charter | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue | 9,800 | 8,700 | 25,700 | 19,800 | |
Other | Safety and Security | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue | 5,900 | $ 5,900 | 17,500 | $ 12,600 | |
Other | Software-as-a-service | |||||
Disaggregation of Revenue [Line Items] | |||||
Revenue | 5,900 | 7,000 | |||
Prepaid expenses | |||||
Disaggregation of Revenue [Line Items] | |||||
Capitalized contract cost, net | 4,800 | 4,800 | $ 8,700 | ||
Other current assets | |||||
Disaggregation of Revenue [Line Items] | |||||
Capitalized contract cost, net | $ 600 | $ 600 | $ 1,300 |
REVENUE RECOGNITION - Schedul_2
REVENUE RECOGNITION - Schedule of Accounts Receivable Net Consists (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Gross receivables from members and customers | $ 49,705 | $ 112,243 |
Undeposited funds | 5,304 | 10,122 |
Less: Allowance for credit losses | (8,236) | (9,982) |
Accounts receivable, net | $ 46,773 | $ 112,383 |
REVENUE RECOGNITION - Schedul_3
REVENUE RECOGNITION - Schedule of Deferred Revenue (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Disaggregation of Revenue [Line Items] | ||
Deferred revenue - total | $ 692,369 | $ 1,076,875 |
Less: Deferred revenue - current | (691,214) | (1,075,133) |
Deferred revenue - non-current | 1,155 | 1,742 |
Flights - Prepaid Blocks | ||
Disaggregation of Revenue [Line Items] | ||
Deferred revenue - total | 651,458 | 1,023,985 |
Memberships - annual dues | ||
Disaggregation of Revenue [Line Items] | ||
Deferred revenue - total | 35,935 | 43,970 |
Memberships - initiation fees | ||
Disaggregation of Revenue [Line Items] | ||
Deferred revenue - total | 2,804 | 3,899 |
Flights - credits | ||
Disaggregation of Revenue [Line Items] | ||
Deferred revenue - total | 1,773 | 4,246 |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Deferred revenue - total | $ 399 | $ 775 |
REVENUE RECOGNITION - Changes i
REVENUE RECOGNITION - Changes in Deferred Revenue (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Contract with Customer, Liability [Roll Forward] | |
Deferred revenue as of December 31, 2022 | $ 1,076,875 |
Amounts deferred during the period | 342,923 |
Revenue recognized from amounts included in the deferred revenue beginning balance | (571,211) |
Revenue from current period sales | (156,218) |
Deferred revenue as of September 30, 2023 | $ 692,369 |
REVENUE RECOGNITION - Schedul_4
REVENUE RECOGNITION - Schedule of Revenue Expected to be Recognized in Future Periods (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue expected to be recognized in future periods | $ 692,369 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-10-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue expected to be recognized in future periods | $ 113,830 |
Revenue recognition periods (in years) | 3 months |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue expected to be recognized in future periods | $ 292,149 |
Revenue recognition periods (in years) | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue expected to be recognized in future periods | $ 143,268 |
Revenue recognition periods (in years) | 1 year |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-01-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue expected to be recognized in future periods | $ 143,122 |
Revenue recognition periods (in years) | 1 year |
PROPERTY AND EQUIPMENT - Schedu
PROPERTY AND EQUIPMENT - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 628,553 | $ 656,590 |
Less: Accumulated depreciation and amortization | (266,500) | (262,031) |
Total | 362,053 | 394,559 |
Aircraft | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 509,984 | 566,338 |
Software development costs | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 80,582 | 65,303 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 22,274 | 11,930 |
Computer equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 3,447 | 3,014 |
Buildings and improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 1,424 | 1,424 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 4,311 | 3,208 |
Tooling | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 4,180 | 3,835 |
Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 2,351 | $ 1,538 |
PROPERTY AND EQUIPMENT - Narrat
PROPERTY AND EQUIPMENT - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Property, Plant and Equipment [Line Items] | ||||
Depreciation and amortization | $ 10 | $ 10.6 | $ 28.8 | $ 30.3 |
Software development costs | ||||
Property, Plant and Equipment [Line Items] | ||||
Amortization | $ 4.4 | $ 3.6 | $ 11.2 | $ 9 |
ACQUISITIONS AND DIVESTITURES -
ACQUISITIONS AND DIVESTITURES - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2023 USD ($) | Apr. 01, 2022 USD ($) location continent | Feb. 03, 2022 USD ($) aircraft | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | |
Business Acquisition [Line Items] | ||||||
Loss on divestiture | $ (2,991) | $ 0 | $ (2,991) | $ 0 | ||
Proceeds from sale of divested business, net | $ 13,200 | $ 0 | ||||
Discontinued Operations, Disposed of by Sale | Circadian Aviation LLC | ||||||
Business Acquisition [Line Items] | ||||||
Sale of issued and outstanding equity interests | 100% | 100% | ||||
Loss on divestiture | $ (3,000) | |||||
Aggregate consideration transferred | 19,100 | $ 19,100 | ||||
Proceeds from sale of divested business, net | 13,200 | |||||
Non-contingent consideration receivable | 500 | 500 | ||||
Discontinued Operations, Disposed of by Sale | Circadian Aviation LLC | Escrow Receivable | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of contingent consideration | 600 | 600 | ||||
Discontinued Operations, Disposed of by Sale | Circadian Aviation LLC | Contingent Consideration | ||||||
Business Acquisition [Line Items] | ||||||
Fair value of contingent consideration | $ 4,800 | $ 4,800 | ||||
Alante Air | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 15,500 | |||||
Number of jets | aircraft | 12 | |||||
Acquisition related fees | $ 500 | |||||
Cash | 3,000 | |||||
Accounts receivables | 1,400 | |||||
Alante Air | Eliminated in consolidation upon acquisition | ||||||
Business Acquisition [Line Items] | ||||||
Accounts receivables | $ (15) | |||||
Air Partner | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 108,200 | |||||
Cash | 18,000 | |||||
Accounts receivables | $ 16,600 | |||||
Number of operating location | location | 18 | |||||
Operating continents | continent | 4 |
ACQUISITIONS AND DIVESTITURES_2
ACQUISITIONS AND DIVESTITURES - Preliminary Purchase Price (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Apr. 01, 2022 | Feb. 03, 2022 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 214,808 | $ 348,118 | ||
Alante Air | ||||
Business Acquisition [Line Items] | ||||
Current assets | $ 4,452 | |||
Goodwill | 13,069 | |||
Other assets | 22,048 | |||
Total assets acquired | 39,569 | |||
Total liabilities assumed | (24,101) | |||
Net assets acquired | $ 15,468 | |||
Air Partner | ||||
Business Acquisition [Line Items] | ||||
Current assets | $ 49,617 | |||
Property and equipment, net | 2,012 | |||
Operating lease right-of-use assets | 2,780 | |||
Goodwill | 83,910 | |||
Intangible assets | 20,921 | |||
Restricted cash | 27,507 | |||
Other assets | 1,686 | |||
Total assets acquired | 188,433 | |||
Total liabilities assumed | (80,239) | |||
Net assets acquired | $ 108,194 |
ACQUISITIONS AND DIVESTITURES_3
ACQUISITIONS AND DIVESTITURES - Intangible Assets Acquired (Details) - Air Partner $ in Thousands | Apr. 01, 2022 USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets acquired | $ 20,921 |
Weighted-Average Amortization Period (Years) | 5 years 1 month 6 days |
Customer relationships | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets acquired | $ 16,521 |
Weighted-Average Amortization Period (Years) | 5 years 8 months 12 days |
Backlog | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets acquired | $ 1,458 |
Weighted-Average Amortization Period (Years) | 1 year 6 months |
Trade name | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets acquired | $ 1,931 |
Weighted-Average Amortization Period (Years) | 1 year 10 months 24 days |
Developed technology | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets acquired | $ 1,011 |
Weighted-Average Amortization Period (Years) | 5 years 9 months 18 days |
ACQUISITIONS AND DIVESTITURES_4
ACQUISITIONS AND DIVESTITURES - Unaudited Pro Forma Summary of Operations (Details) $ / shares in Units, $ in Thousands | 9 Months Ended |
Sep. 30, 2022 USD ($) $ / shares | |
Business Combination and Asset Acquisition [Abstract] | |
Net revenue | $ 1,209,321 |
Net loss | (266,628) |
Net loss attributable to Wheels Up Experience Inc. | $ (266,628) |
Net loss per share, basic (in dollars per share) | $ / shares | $ (10.98) |
Net loss per share, diluted (in dollars per share) | $ / shares | $ (10.98) |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Schedule of Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Goodwill [Roll Forward] | ||||||
Balance as of December 31, 2022 | $ 348,118 | |||||
Acquisitions | 350 | |||||
Impairment | $ (56,200) | $ (62,000) | (126,200) | $ (62,000) | ||
Divestitures | (8,169) | |||||
Foreign currency translation adjustment | 708 | |||||
Balance as of September 30, 2023 | 214,808 | 214,808 | $ 348,118 | |||
Impairment | 56,200 | $ 62,000 | 126,200 | $ 62,000 | ||
WUP Legacy | ||||||
Goodwill [Roll Forward] | ||||||
Balance as of December 31, 2022 | 270,467 | |||||
Acquisitions | 0 | |||||
Impairment | (56,200) | $ (70,000) | (126,200) | (180,000) | ||
Divestitures | (8,169) | |||||
Foreign currency translation adjustment | 0 | |||||
Balance as of September 30, 2023 | 136,098 | 136,098 | 270,467 | |||
Impairment | 56,200 | $ 70,000 | 126,200 | 180,000 | ||
Air Partner | ||||||
Goodwill [Roll Forward] | ||||||
Balance as of December 31, 2022 | 77,651 | |||||
Acquisitions | 350 | |||||
Impairment | 0 | |||||
Divestitures | 0 | |||||
Foreign currency translation adjustment | 708 | |||||
Balance as of September 30, 2023 | $ 78,710 | 78,710 | $ 77,651 | |||
Impairment | $ 0 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Schedule of Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | $ 203,626 | $ 208,444 |
Accumulated Amortization | 80,843 | 66,679 |
Net Carrying Value | 122,783 | 141,765 |
Status | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 80,000 | 80,000 |
Accumulated Amortization | 29,644 | 23,644 |
Net Carrying Value | 50,356 | 56,356 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 89,121 | 91,121 |
Accumulated Amortization | 32,226 | 24,613 |
Net Carrying Value | 56,895 | 66,508 |
Non-competition agreement | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 210 | |
Accumulated Amortization | 210 | |
Net Carrying Value | 0 | |
Trade name | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 13,161 | 16,161 |
Accumulated Amortization | 6,321 | 8,294 |
Net Carrying Value | 6,840 | 7,867 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 20,556 | 20,556 |
Accumulated Amortization | 11,580 | 9,332 |
Net Carrying Value | 8,976 | 11,224 |
Leasehold interest - favorable | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 600 | 600 |
Accumulated Amortization | 96 | 80 |
Net Carrying Value | 504 | 520 |
Backlog | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | 1,458 | 1,458 |
Accumulated Amortization | 1,313 | 880 |
Net Carrying Value | 145 | 578 |
Foreign currency translation adjustment | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Value | (1,480) | (1,662) |
Accumulated Amortization | (547) | (374) |
Net Carrying Value | $ (933) | $ (1,288) |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangible assets | $ 6 | $ 6.4 | $ 17.8 | $ 18.1 |
Amortization of intangible liabilities | $ 0.5 | $ 0.5 | $ 1.5 | $ 1.5 |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS - Intangible Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Gross Carrying Value | $ 20,000 | $ 20,000 |
Accumulated Amortization | 7,417 | 5,917 |
Net Carrying Value | $ 12,583 | $ 14,083 |
GOODWILL AND INTANGIBLE ASSET_6
GOODWILL AND INTANGIBLE ASSETS - Future Amortization (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 |
Intangible Assets | ||
2023 (remaining) | $ 5,865 | |
2024 | 22,759 | |
2025 | 22,345 | |
2026 | 21,486 | |
2027 | 17,018 | |
2028 and Thereafter | 33,310 | |
Net Carrying Value | 122,783 | $ 141,765 |
Intangible Liabilities | ||
2023 (remaining) | 500 | |
2024 | 2,000 | |
2025 | 2,000 | |
2026 | 2,000 | |
2027 | 2,000 | |
2028 and Thereafter | 4,083 | |
Net Carrying Value | $ 12,583 | $ 14,083 |
CASH EQUIVALENTS AND RESTRICT_3
CASH EQUIVALENTS AND RESTRICTED CASH - Narrative (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Cash and Cash Equivalents [Line Items] | ||
Cash equivalents | $ 0.1 | $ 430.3 |
Standby Letter Of Credit | ||
Cash and Cash Equivalents [Line Items] | ||
Restricted cash | 6.2 | 6.2 |
Credit Card Programs | Collateral against credit card programs | ||
Cash and Cash Equivalents [Line Items] | ||
Restricted cash | 3.4 | 3.4 |
Contractual Restrictions | ||
Cash and Cash Equivalents [Line Items] | ||
Restricted cash | $ 19.7 | $ 26.3 |
CASH EQUIVALENTS AND RESTRICT_4
CASH EQUIVALENTS AND RESTRICTED CASH - Reconciliation of Cash and Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Dec. 31, 2022 | Sep. 30, 2022 | Dec. 31, 2021 |
Cash and Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 244,847 | $ 585,881 | ||
Restricted cash | 29,315 | 34,272 | ||
Total | $ 274,162 | $ 620,153 | $ 311,914 | $ 786,722 |
LONG-TERM DEBT - Schedule of Lo
LONG-TERM DEBT - Schedule of Long-term Debt Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Sep. 20, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | |||
Total debt | $ 583,582 | $ 270,000 | |
Less: Total unamortized deferred financing costs and debt discount | 322,926 | 16,760 | |
Less: Current maturities of long-term debt | 25,227 | 27,006 | |
Long-term debt | $ 235,429 | 226,234 | |
Notes Payable | Equipment Notes | |||
Debt Instrument [Line Items] | |||
Weighted Average Interest Rate | 12% | ||
Total debt | $ 232,610 | 270,000 | |
Term Loan and Revolving Credit Facility | Credit Agreement | Term loan | |||
Debt Instrument [Line Items] | |||
Weighted Average Interest Rate | 10% | ||
Total debt | $ 350,972 | $ 41,400 | $ 0 |
LONG-TERM DEBT - Schedule of Ma
LONG-TERM DEBT - Schedule of Maturities of Long-term Debt (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Debt Disclosure [Abstract] | |
Remainder of 2023 | $ 6,307 |
2024 | 25,227 |
2025 | 43,916 |
2026 | 38,907 |
2027 | 33,258 |
2028 and Thereafter | 435,967 |
Total | $ 583,582 |
LONG-TERM DEBT - Narrative (Det
LONG-TERM DEBT - Narrative (Details) | 3 Months Ended | 9 Months Ended | |||||||
Sep. 20, 2023 USD ($) instrument shares | Sep. 15, 2023 | Oct. 14, 2022 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) aircraft | Sep. 30, 2022 USD ($) | Aug. 08, 2023 USD ($) | Dec. 31, 2022 USD ($) | |
Debt Instrument [Line Items] | |||||||||
Number of aircraft | aircraft | 1,500 | ||||||||
Amortization of deferred financing costs and debt discount | $ 2,390,000 | $ 0 | |||||||
Net proceeds | 343,000,000 | 0 | |||||||
Number of instruments | instrument | 3 | ||||||||
Initial carrying value | $ 583,582,000 | 583,582,000 | $ 270,000,000 | ||||||
Interest expense | 11,258,000 | $ 0 | 27,035,000 | $ 0 | |||||
Long-term debt, fair value | 270,000,000 | ||||||||
Term loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt, fair value | $ 44,900,000 | 268,400,000 | 268,400,000 | ||||||
Deferred Issuance | |||||||||
Debt Instrument [Line Items] | |||||||||
Common stock issued (in shares) | shares | 529,926,270 | ||||||||
Percentage of issued and outstanding shares of Common Stock on a fully diluted basis | 95% | ||||||||
Allocation on relative fair value basis | $ 240,900,000 | ||||||||
Deferred issuance costs | 18,300,000 | ||||||||
Term Loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Deferred issuance costs | 3,400,000 | ||||||||
Initial Issuance | |||||||||
Debt Instrument [Line Items] | |||||||||
Percentage of issued and outstanding shares of Common Stock on a fully diluted basis | 80% | ||||||||
Allocation on relative fair value basis | 64,200,000 | ||||||||
Deferred issuance costs | $ 4,900,000 | ||||||||
Initial Issuance | Common Stock | |||||||||
Debt Instrument [Line Items] | |||||||||
Common stock issued (in shares) | shares | 141,313,671 | ||||||||
Equipment Notes | Notes Payable | |||||||||
Debt Instrument [Line Items] | |||||||||
Face amount | $ 270,000,000 | ||||||||
Stated rate | 12% | ||||||||
Net proceeds | $ 259,200,000 | ||||||||
Annual amortization of principal percent | 10% | ||||||||
Minimum liquidity | $ 75,000,000 | $ 125,000,000 | |||||||
Minimum aggregate available cash and Cash Equivalents | 75,000,000 | ||||||||
Debt redeemed | 17,400,000 | 17,400,000 | |||||||
Amortization of deferred financing costs and debt discount | 300,000 | 2,700,000 | |||||||
Initial carrying value | 232,610,000 | $ 232,610,000 | 270,000,000 | ||||||
Equipment Notes | Notes Payable | Not subject to first-priority liens | |||||||||
Debt Instrument [Line Items] | |||||||||
Number of aircraft | aircraft | 7 | ||||||||
Equipment Notes | Notes Payable | Subject to first-priority liens | |||||||||
Debt Instrument [Line Items] | |||||||||
Number of aircraft | aircraft | 127 | ||||||||
Flight equipment | 300,200,000 | $ 300,200,000 | |||||||
Equipment Notes | Notes Payable | Aircraft | |||||||||
Debt Instrument [Line Items] | |||||||||
Number of aircraft | aircraft | 127 | ||||||||
Delta Promissory Note | Notes Payable | |||||||||
Debt Instrument [Line Items] | |||||||||
Stated rate | 10% | ||||||||
Aggregate principal amount | $ 70,000,000 | ||||||||
Credit Agreement | |||||||||
Debt Instrument [Line Items] | |||||||||
Issuance costs | 26,600,000 | ||||||||
Credit Agreement | General and administrative | |||||||||
Debt Instrument [Line Items] | |||||||||
Issuance costs | 4,900,000 | ||||||||
Credit Agreement | Term Loan and Revolving Credit Facility | Term loan | |||||||||
Debt Instrument [Line Items] | |||||||||
Face amount | $ 350,000,000 | ||||||||
Stated rate | 10% | ||||||||
Amortization of deferred financing costs and debt discount | $ (300,000) | ||||||||
Net proceeds | $ 343,000,000 | ||||||||
Increment principal amount | $ 50,000,000 | ||||||||
Interest rate if not consummated | 20% | ||||||||
Credit agreement interest rate | 2% | ||||||||
Initial carrying value | $ 41,400,000 | 350,972,000 | $ 350,972,000 | $ 0 | |||||
Unamortized debt issuance costs | 3,400,000 | ||||||||
Unamortized debt discount | 305,200,000 | ||||||||
Interest expense | $ (300,000) | ||||||||
Credit Agreement | Term Loan and Revolving Credit Facility | Revolving Credit Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Aggregate original principal amount | $ 100,000,000 |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Financial Instruments Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands | Sep. 30, 2023 | Sep. 20, 2023 | Dec. 31, 2022 |
Assets: | |||
Assets | $ 89 | $ 430,326 | |
Liabilities: | |||
Warrant liability | 66 | 751 | |
Long-term debt, fair value | 270,000 | ||
Total liabilities | 538,267 | 270,751 | |
Money market funds | |||
Assets: | |||
Assets | 89 | 230,626 | |
Treasury bills | |||
Assets: | |||
Assets | 199,700 | ||
Public Warrants | |||
Liabilities: | |||
Warrant liability | 42 | 479 | |
Private Warrants | |||
Liabilities: | |||
Warrant liability | 24 | 272 | |
Equipment Notes | |||
Liabilities: | |||
Long-term debt, fair value | 269,801 | ||
Term loan | |||
Liabilities: | |||
Long-term debt, fair value | 268,400 | $ 44,900 | |
Level 1 | |||
Assets: | |||
Assets | 89 | 430,326 | |
Liabilities: | |||
Long-term debt, fair value | 0 | ||
Total liabilities | 42 | 479 | |
Level 1 | Money market funds | |||
Assets: | |||
Assets | 89 | 230,626 | |
Level 1 | Treasury bills | |||
Assets: | |||
Assets | 199,700 | ||
Level 1 | Public Warrants | |||
Liabilities: | |||
Warrant liability | 42 | 479 | |
Level 1 | Private Warrants | |||
Liabilities: | |||
Warrant liability | 0 | 0 | |
Level 1 | Equipment Notes | |||
Liabilities: | |||
Long-term debt, fair value | 0 | ||
Level 1 | Term loan | |||
Liabilities: | |||
Long-term debt, fair value | 0 | ||
Level 2 | |||
Assets: | |||
Assets | 0 | 0 | |
Liabilities: | |||
Long-term debt, fair value | 270,000 | ||
Total liabilities | 24 | 270,272 | |
Level 2 | Money market funds | |||
Assets: | |||
Assets | 0 | 0 | |
Level 2 | Treasury bills | |||
Assets: | |||
Assets | 0 | ||
Level 2 | Public Warrants | |||
Liabilities: | |||
Warrant liability | 0 | 0 | |
Level 2 | Private Warrants | |||
Liabilities: | |||
Warrant liability | 24 | 272 | |
Level 2 | Equipment Notes | |||
Liabilities: | |||
Long-term debt, fair value | 0 | ||
Level 2 | Term loan | |||
Liabilities: | |||
Long-term debt, fair value | 0 | ||
Level 3 | |||
Assets: | |||
Assets | 0 | 0 | |
Liabilities: | |||
Long-term debt, fair value | 0 | ||
Total liabilities | 538,201 | 0 | |
Level 3 | Money market funds | |||
Assets: | |||
Assets | 0 | 0 | |
Level 3 | Treasury bills | |||
Assets: | |||
Assets | 0 | ||
Level 3 | Public Warrants | |||
Liabilities: | |||
Warrant liability | 0 | 0 | |
Level 3 | Private Warrants | |||
Liabilities: | |||
Warrant liability | 0 | $ 0 | |
Level 3 | Equipment Notes | |||
Liabilities: | |||
Long-term debt, fair value | 269,801 | ||
Level 3 | Term loan | |||
Liabilities: | |||
Long-term debt, fair value | $ 268,400 |
FAIR VALUE MEASUREMENTS - Chang
FAIR VALUE MEASUREMENTS - Changes in the Fair Value of the Warrant Liability (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Fair value as of December 31, 2022 | $ 751 |
Change in fair value of warrant liability | (685) |
Fair value as of September 30, 2023 | 66 |
Public Warrants | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Fair value as of December 31, 2022 | 479 |
Change in fair value of warrant liability | (437) |
Fair value as of September 30, 2023 | $ 42 |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Change in fair value of warrant liability |
Private Warrants | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Fair value as of December 31, 2022 | $ 272 |
Change in fair value of warrant liability | (248) |
Fair value as of September 30, 2023 | $ 24 |
Fair Value, Liability, Recurring Basis, Unobservable Input Reconciliation, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Change in fair value of warrant liability |
LEASES - Components of Net Leas
LEASES - Components of Net Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Leases [Abstract] | ||||
Operating lease costs | $ 9,313 | $ 9,789 | $ 30,648 | $ 28,614 |
Short-term lease costs | 2,039 | 8,086 | 6,676 | 22,600 |
Variable lease costs | 10,519 | 3,563 | 25,018 | 12,516 |
Total lease costs | $ 21,871 | $ 21,438 | $ 62,342 | $ 63,730 |
LEASES - Supplemental Cash Flow
LEASES - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Cash paid for amounts included in the measurement of operating lease liabilities: | ||
Operating cash flows paid for operating leases | $ 28,318 | $ 28,865 |
Right-of-use assets obtained in exchange for operating lease obligations | $ 5,742 | $ 46,916 |
LEASES - Supplemental Balance S
LEASES - Supplemental Balance Sheet Information (Details) | Sep. 30, 2023 | Sep. 30, 2022 |
Weighted-average remaining lease term (in years): | ||
Operating leases | 6 years 8 months 12 days | 5 years 10 months 24 days |
Weighted-average discount rate: | ||
Operating leases | 9.10% | 9% |
LEASES - Maturities of Operatin
LEASES - Maturities of Operating Leases (Details) $ in Thousands | Sep. 30, 2023 USD ($) |
Leases [Abstract] | |
2023 (remaining) | $ 8,159 |
2024 | 28,522 |
2025 | 16,993 |
2026 | 9,826 |
2027 | 7,520 |
2028 and Thereafter | 43,090 |
Total lease payments | 114,110 |
Less: Imputed interest | (31,561) |
Total lease obligations | $ 82,549 |
STOCKHOLDER_S EQUITY AND EQUI_3
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION - Narrative (Details) | 3 Months Ended | 9 Months Ended | |||||||||
Sep. 20, 2023 USD ($) shares | Sep. 30, 2023 USD ($) $ / shares shares | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) plan day tranche $ / shares shares | Sep. 30, 2022 USD ($) | Jun. 07, 2023 vote $ / shares shares | Jun. 06, 2023 shares | May 31, 2023 shares | Dec. 31, 2022 shares | Jun. 30, 2022 shares | Jul. 13, 2021 $ / shares shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock authorized (in shares) | 250,000,000 | 250,000,000 | 250,000,000 | 2,500,000,000 | 250,000,000 | ||||||
Preferred stock authorized (in shares) | 25,000,000 | ||||||||||
Preferred stock par value (in dollars per share) | $ / shares | $ 0.0001 | ||||||||||
Warrants, exercise price (in dollars per share) | $ / shares | $ 115 | $ 115 | $ 115 | $ 115 | |||||||
Number of approved plans | plan | 9 | ||||||||||
Compensation expense | $ | $ 3,508,000 | $ 22,504,000 | $ 21,650,000 | $ 65,839,000 | |||||||
Shares withheld for employee taxes on vested equity (in shares) | 275,707 | ||||||||||
Warrant right to purchase shares (in shares) | 0.1 | 0.1 | 0.1 | 0.1 | |||||||
CK Wheels LLC | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Voting restrictions | 19.90% | ||||||||||
Delta | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Voting restrictions | 29.90% | ||||||||||
Private Placement | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock issued (in shares) | 141,313,671 | ||||||||||
Percentage of shares issued and outstanding | 80% | ||||||||||
Gross proceeds | $ | $ 64,200,000 | ||||||||||
Issuance costs | $ | $ 4,900,000 | ||||||||||
Additional shares (in shares) | 529,926,270 | ||||||||||
Deferred Issuance | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock issued (in shares) | 529,926,270 | ||||||||||
Gross proceeds | $ | $ 240,900,000 | ||||||||||
Issuance costs | $ | $ 18,300,000 | ||||||||||
WUP Profits Interests | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Weighted average remaining contractual term (in years) | 7 years 9 months 18 days | ||||||||||
Granted (in shares) | 0 | ||||||||||
Compensation expense | $ | $ 0 | 200,000 | $ 100,000 | 1,100,000 | |||||||
Nonvested awards (in shares) | 0 | 0 | 170,000 | ||||||||
WUP Restricted Interests | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Compensation expense | $ | $ 0 | $ 0 | 400,000 | ||||||||
Stock options | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Compensation expense | $ | 200,000 | 1,300,000 | 1,100,000 | 5,500,000 | |||||||
PSUs | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Unrecognized compensation | $ | 300,000 | 300,000 | |||||||||
Earnout Share | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Compensation expense | $ | $ 0 | 9,700,000 | $ 1,400,000 | 28,800,000 | |||||||
Nonvested awards (in shares) | 900,000 | 900,000 | |||||||||
Earnout Share | Vesting period one | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Nonvested awards (in shares) | 3,000,000 | 3,000,000 | |||||||||
Earnout Share | Vesting period two | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Nonvested awards (in shares) | 3,000,000 | 3,000,000 | |||||||||
Earnout Share | Vesting period three | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Nonvested awards (in shares) | 3,000,000 | 3,000,000 | |||||||||
Profit Interest Based Award and Restricted Stock | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Weighted average remaining contractual term (in years) | 1 year 8 months 12 days | ||||||||||
Compensation expense | $ | $ 57,900,000 | ||||||||||
Market-based RSUs | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting condition, threshold consecutive trading days | day | 30 | ||||||||||
RSUs, PSUs, and Market-Based RSUs | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Compensation expense | $ | $ 3,300,000 | $ 11,200,000 | $ 15,200,000 | $ 29,900,000 | |||||||
2021 LTIP | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Shares authorized (in shares) | 5,200,000 | 5,200,000 | 2,415,000 | 24,150,000 | |||||||
2021 LTIP | Stock options | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Aggregate intrinsic value | $ | $ 0 | $ 0 | |||||||||
Weighted average remaining contractual term, outstanding (in years) | 4 years 1 month 6 days | ||||||||||
Weighted average remaining contractual term, exercisable (in years) | 4 years 1 month 6 days | ||||||||||
2021 LTIP | PSUs | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Granted (in shares) | 145,000 | ||||||||||
Nonvested awards (in shares) | 165,000 | 165,000 | 96,000 | ||||||||
2021 LTIP | RSUs | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Granted (in shares) | 2,297,000 | ||||||||||
Unrecognized compensation cost recognition period (in years) | 1 year 7 months 6 days | ||||||||||
Unrecognized compensation | $ | $ 20,500,000 | $ 20,500,000 | |||||||||
Nonvested awards (in shares) | 2,681,000 | 2,681,000 | 1,617,000 | ||||||||
2022 Inducement Grant Plan | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Inducement grant plan (in shares) | 205,128 | 2,051,282 | |||||||||
MIP Plan VII | WUP Profits Interests | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Shares authorized (in shares) | 3,100,000 | 3,100,000 | |||||||||
WUP Stock Option Plan | Stock options | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Shares authorized (in shares) | 1,800,000 | 1,800,000 | |||||||||
Aggregate intrinsic value | $ | $ 0 | $ 0 | |||||||||
Weighted average remaining contractual term, outstanding (in years) | 5 years 9 months 18 days | ||||||||||
Weighted average remaining contractual term, exercisable (in years) | 5 years 9 months 18 days | ||||||||||
Common Class A | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Common stock authorized (in shares) | 250,000,000 | 2,500,000,000 | |||||||||
Voting rights per share | vote | 1 | ||||||||||
Common Class A | Earnout Share | Vesting period one | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Equal tranches | tranche | 3 | ||||||||||
Vesting milestone (in dollars per share) | $ / shares | $ 125 | $ 125 | |||||||||
Minimum threshold days (in days) | 20 days | ||||||||||
Number of consecutive trading days (in days) | 30 days | ||||||||||
Common Class A | Earnout Share | Vesting period two | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting milestone (in dollars per share) | $ / shares | 150 | $ 150 | |||||||||
Common Class A | Earnout Share | Vesting period three | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Vesting milestone (in dollars per share) | $ / shares | $ 175 | $ 175 | |||||||||
Common Class A | WUP Stock Option Plan | Stock options | |||||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||||||
Number of common stock exercisable for each outstanding stock option (in shares) | 1 | 1 |
STOCKHOLDER_S EQUITY AND EQUI_4
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION - Summary of Profits Interest Activity (Details) - WUP Profits Interests shares in Thousands | 9 Months Ended |
Sep. 30, 2023 $ / shares shares | |
Number of RSUs | |
Beginning balance (in shares) | shares | 2,881 |
Granted (in shares) | shares | 0 |
Exchanged (in shares) | shares | 0 |
Expired/forfeited (in shares) | shares | 0 |
Ending balance (in shares) | shares | 2,881 |
Weighted-Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 4.16 |
Granted (in dollars per share) | $ / shares | 0 |
Exchanged (in dollars per share) | $ / shares | 0 |
Expired/forfeited (in dollars per share) | $ / shares | 0 |
Ending balance (in dollars per share) | $ / shares | $ 4.16 |
STOCKHOLDER_S EQUITY AND EQUI_5
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION - Schedule of Nonvested Profit Interests (Details) - WUP Profits Interests shares in Thousands | 9 Months Ended |
Sep. 30, 2023 $ / shares shares | |
Number of WUP Profits Interests | |
Beginning balance (in shares) | shares | 170 |
Granted (in shares) | shares | 0 |
Vested (in shares) | shares | (170) |
Forfeited (in shares) | shares | 0 |
Ending balance (in shares) | shares | 0 |
Weighted-Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 4.19 |
Granted (in dollars per share) | $ / shares | 0 |
Vested (in dollars per share) | $ / shares | 4.19 |
Forfeited (in dollars per share) | $ / shares | 0 |
Ending balance (in dollars per share) | $ / shares | $ 0 |
STOCKHOLDER_S EQUITY AND EQUI_6
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION - Summary of Stock Option Activity (Details) - Stock options - $ / shares shares in Thousands | 9 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2022 | |
WUP Stock Option Plan | ||
Number of WUP Stock Options | ||
Beginning balance (in shares) | 1,280 | |
Granted (in shares) | 0 | |
Exercised (in shares) | 0 | |
Forfeited (in shares) | (78) | |
Expired (in shares) | (10) | |
Ending balance (in shares) | 1,192 | |
Exercisable (in shares) | 1,192 | |
Weighted- Average Exercise Price | ||
Beginning balance (in dollars per share) | $ 75.10 | |
Granted (in dollars per share) | 0 | |
Exercised (in dollars per share) | 0 | |
Forfeited (in dollars per share) | 71.63 | |
Expired (in dollars per share) | 72.71 | |
Ending balance (in dollars per share) | 75.35 | |
Exercisable (in dollars per share) | 75.35 | |
Weighted-Average Grant Date Fair Value | ||
Beginning balance (in dollars per share) | 12.38 | $ 12.02 |
Granted (in dollars per share) | 0 | |
Exercised (in dollars per share) | 0 | |
Forfeited (in dollars per share) | 7.34 | |
Expired (in dollars per share) | 6.74 | |
Ending balance (in dollars per share) | 12.38 | |
Exercisable (in dollars per share) | $ 12.38 | |
2021 LTIP | ||
Number of WUP Stock Options | ||
Beginning balance (in shares) | 77 | |
Granted (in shares) | 0 | |
Exercised (in shares) | 0 | |
Forfeited (in shares) | 0 | |
Expired (in shares) | 0 | |
Ending balance (in shares) | 77 | |
Exercisable (in shares) | 77 | |
Weighted- Average Exercise Price | ||
Beginning balance (in dollars per share) | $ 100 | |
Granted (in dollars per share) | 0 | |
Exercised (in dollars per share) | 0 | |
Forfeited (in dollars per share) | 0 | |
Expired (in dollars per share) | 0 | |
Ending balance (in dollars per share) | 100 | |
Exercisable (in dollars per share) | 100 | |
Weighted-Average Grant Date Fair Value | ||
Beginning balance (in dollars per share) | 47.52 | $ 47.52 |
Granted (in dollars per share) | 0 | |
Exercised (in dollars per share) | 0 | |
Forfeited (in dollars per share) | 0 | |
Expired (in dollars per share) | 0 | |
Ending balance (in dollars per share) | 47.52 | |
Exercisable (in dollars per share) | $ 47.52 |
STOCKHOLDER_S EQUITY AND EQUI_7
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION - Schedule of Nonvested Share Activity (Details) - Stock options shares in Thousands | 9 Months Ended |
Sep. 30, 2023 $ / shares shares | |
WUP Stock Option Plan | |
Number of Stock Option | |
Beginning balance (in shares) | shares | 104 |
Granted (in shares) | shares | 0 |
Vested (in shares) | shares | (102) |
Expired (in shares) | shares | 0 |
Forfeited (in shares) | shares | (2) |
Ending balance (in shares) | shares | 0 |
Weighted-Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 19.95 |
Granted (in dollars per share) | $ / shares | 0 |
Vested, (in dollars per share) | $ / shares | 20.03 |
Expired (in dollars per share) | $ / shares | 0 |
Forfeited (in dollars per share) | $ / shares | 16.01 |
Ending balance (in dollars per share) | $ / shares | $ 0 |
2021 LTIP | |
Number of Stock Option | |
Granted (in shares) | shares | 0 |
Weighted-Average Grant Date Fair Value | |
Granted (in dollars per share) | $ / shares | $ 0 |
STOCKHOLDER_S EQUITY AND EQUI_8
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION - Schedule of LTIP RSUs (Details) - 2021 LTIP | 9 Months Ended |
Sep. 30, 2023 $ / shares shares | |
RSUs | |
Number of RSUs | |
Beginning balance (in shares) | 1,617,000 |
Granted (in shares) | 2,297,000 |
Vested (in shares) | (584,000) |
Forfeited (in shares) | (649,000) |
Ending balance (in shares) | 2,681,000 |
Weighted-Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 34.64 |
Granted (in dollars per share) | $ / shares | 2.69 |
Vested (in dollars per share) | $ / shares | 35.25 |
Forfeited (in dollars per share) | $ / shares | 22.28 |
Ending balance (in dollars per share) | $ / shares | $ 10.12 |
RSUs | July 2022 | |
Number of RSUs | |
Granted (in shares) | 205,128 |
Vested (in shares) | (68,376) |
Ending balance (in shares) | 136,752 |
PSUs | |
Number of RSUs | |
Beginning balance (in shares) | 96,000 |
Granted (in shares) | 145,000 |
Vested (in shares) | (32,000) |
Forfeited (in shares) | (44,000) |
Ending balance (in shares) | 165,000 |
Weighted-Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 21.68 |
Granted (in dollars per share) | $ / shares | 2.93 |
Vested (in dollars per share) | $ / shares | 12.19 |
Forfeited (in dollars per share) | $ / shares | 15.19 |
Ending balance (in dollars per share) | $ / shares | $ 8.71 |
STOCKHOLDER_S EQUITY AND EQUI_9
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION - Performance Stock Units (Details) - 2021 LTIP shares in Thousands | 9 Months Ended |
Sep. 30, 2023 $ / shares shares | |
PSUs | |
Number of RSUs | |
Beginning balance (in shares) | 96 |
Granted (in shares) | 145 |
Vested (in shares) | (32) |
Forfeited (in shares) | (44) |
Ending balance (in shares) | 165 |
Weighted-Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 21.68 |
Ending balance (in dollars per share) | $ / shares | $ 8.71 |
PSUs | Minimum | First share price vesting threshold | |
Weighted-Average Grant Date Fair Value | |
Level of performance | 0% |
PSUs | Minimum | Second share price vesting threshold | |
Weighted-Average Grant Date Fair Value | |
Level of performance | 0% |
PSUs | Maximum | First share price vesting threshold | |
Weighted-Average Grant Date Fair Value | |
Level of performance | 120% |
PSUs | Maximum | Second share price vesting threshold | |
Weighted-Average Grant Date Fair Value | |
Level of performance | 200% |
PSUs | Common Class A | First share price vesting threshold | |
Weighted-Average Grant Date Fair Value | |
Shares that may settle into Class A common stock (in shares) | 84 |
PSUs | Common Class A | Second share price vesting threshold | |
Weighted-Average Grant Date Fair Value | |
Shares that may settle into Class A common stock (in shares) | 106 |
Stock options | |
Weighted-Average Grant Date Fair Value | |
Granted (in dollars per share) | $ / shares | $ 0 |
RSUs | |
Number of RSUs | |
Beginning balance (in shares) | 1,617 |
Granted (in shares) | 2,297 |
Vested (in shares) | (584) |
Forfeited (in shares) | (649) |
Ending balance (in shares) | 2,681 |
Weighted-Average Grant Date Fair Value | |
Beginning balance (in dollars per share) | $ / shares | $ 34.64 |
Ending balance (in dollars per share) | $ / shares | $ 10.12 |
STOCKHOLDER_S EQUITY AND EQU_10
STOCKHOLDER’S EQUITY AND EQUITY-BASED COMPENSATION - Equity-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total equity-based compensation expense | $ 3,508 | $ 22,504 | $ 21,650 | $ 65,839 |
Cost of revenue | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total equity-based compensation expense | 826 | 3,581 | 3,097 | 11,320 |
Technology and development | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total equity-based compensation expense | 620 | 751 | 1,777 | 2,047 |
Sales and marketing | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total equity-based compensation expense | 440 | 2,756 | 1,781 | 8,314 |
General and administrative | ||||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||||
Total equity-based compensation expense | $ 1,622 | $ 15,416 | $ 14,995 | $ 44,158 |
WARRANTS (Details)
WARRANTS (Details) - $ / shares | Sep. 25, 2021 | Sep. 30, 2023 | Jun. 07, 2023 | May 31, 2023 | Jul. 13, 2021 | Jul. 12, 2021 |
Class of Warrant or Right [Line Items] | ||||||
Warrants outstanding (in shares) | 12,521,494 | |||||
Warrant right to purchase shares (in shares) | 0.1 | 0.1 | 0.1 | |||
Warrants, exercise price (in dollars per share) | $ 115 | $ 115 | $ 115 | |||
Warrants, exercisable, period after completion of Aspirational initial public offering (in months) | 12 months | |||||
Warrants issued (in shares) | 1,252,149 | |||||
Public Warrants | ||||||
Class of Warrant or Right [Line Items] | ||||||
Warrants outstanding (in shares) | 7,991,544 | |||||
Private Warrants | ||||||
Class of Warrant or Right [Line Items] | ||||||
Warrants outstanding (in shares) | 4,529,950 |
NON-CONTROLLING INTERESTS - Sch
NON-CONTROLLING INTERESTS - Schedule of Calculation of Non-controlling Interests (Details) | Sep. 30, 2023 shares | Dec. 31, 2022 shares |
Noncontrolling Interest [Abstract] | ||
Number of WUP common units held by Wheels Up (in shares) | 166,804,743 | 24,933,857 |
Number of vested WUP profits interests attributable to non-controlling interests (in shares) | 0 | 0 |
Total WUP common units and vested WUP profits interests outstanding (in shares) | 166,804,743 | 24,933,857 |
Number of WUP common units held by Wheels Up | 1 | 1 |
Number of vested WUP profits interests attributable to non-controlling interests | 0 | 0 |
Total WUP common units and vested WUP profits interests outstanding | 1 | 1 |
Units issuable upon conversion of vested and unvested profits interests (in shares) | 0 |
NON-CONTROLLING INTERESTS - Nar
NON-CONTROLLING INTERESTS - Narrative (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Noncontrolling Interest [Abstract] | ||||
Weighted average ownership percentage by parent (as a percent) | 0 | 0 | 0 | 0 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
Sales and excise tax payable | $ 10.6 | $ 10.4 |
RELATED PARTIES (Details)
RELATED PARTIES (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | |||||
Costs and Expenses | $ 449,068,000 | $ 572,018,000 | $ 1,385,579,000 | $ 1,510,007,000 | |
Incurred expenses in Accrued expenses | 100,814,000 | 100,814,000 | $ 148,947,000 | ||
Other non-current liabilities | 17,873,000 | 17,873,000 | 15,603,000 | ||
Related Party | |||||
Related Party Transaction [Line Items] | |||||
Costs and Expenses | 400,000 | $ 100,000 | 1,500,000 | $ 1,500,000 | |
Incurred expenses in Accrued expenses | 400,000 | 400,000 | 2,400,000 | ||
Other non-current liabilities | $ 4,600,000 | $ 4,600,000 | $ 0 |
RESTRUCTURING AND RELATED CHA_3
RESTRUCTURING AND RELATED CHARGES - Narrative (Details) - March 2023 Restructuring Plan - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Jun. 30, 2023 | Sep. 30, 2023 | Mar. 01, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||||
Pre tax charges | $ 14,000 | |||
Restructuring charges | $ 17,700 | |||
Total restructuring expenses | $ 7,200 | $ 10,520 |
RESTRUCTURING AND RELATED CHA_4
RESTRUCTURING AND RELATED CHARGES - Schedule of Restructuring and Related Costs (Details) - March 2023 Restructuring Plan - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended |
Dec. 31, 2022 | Jun. 30, 2023 | |
Restructuring Cost and Reserve [Line Items] | ||
Total restructuring expenses | $ 7,200 | $ 10,520 |
Cost of revenue | ||
Restructuring Cost and Reserve [Line Items] | ||
Total restructuring expenses | 755 | |
Technology and development | ||
Restructuring Cost and Reserve [Line Items] | ||
Total restructuring expenses | 2,299 | |
Sales and marketing | ||
Restructuring Cost and Reserve [Line Items] | ||
Total restructuring expenses | 2,058 | |
General and administrative | ||
Restructuring Cost and Reserve [Line Items] | ||
Total restructuring expenses | $ 5,408 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense | $ 579 | $ 185 | $ 751 | $ 505 |
Effective income tax rate | (0.40%) | (0.10%) | (0.40%) | (0.20%) |
NET LOSS PER SHARE - Schedule o
NET LOSS PER SHARE - Schedule of Basic and Diluted Net Income (Loss) per Share (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Numerator: | ||||
Net loss attributable to Wheels Up Experience Inc. - basic | $ (144,813,000) | $ (148,838,000) | $ (406,272,000) | $ (330,250,000) |
Net loss attributable to Wheels Up Experience Inc. - diluted | $ (144,813,000) | $ (148,838,000) | $ (406,272,000) | $ (330,250,000) |
Denominator: | ||||
Weighted-average shares of Class A common stock outstanding - basic (in shares) | 41,261,003 | 24,435,096 | 30,737,324 | 24,434,787 |
Weighted-average shares of Class A common stock outstanding - diluted (in shares) | 41,261,003 | 24,435,096 | 30,737,324 | 24,434,787 |
Basic net loss per share of Class A common stock (in dollars per share) | $ (3.51) | $ (6.09) | $ (13.22) | $ (13.52) |
Diluted net loss per share of Class A common stock (in dollars per share) | $ (3.51) | $ (6.09) | $ (13.22) | $ (13.52) |
Dividends declared | $ 0 | $ 0 | $ 0 | $ 0 |
NET LOSS PER SHARE - Schedule_2
NET LOSS PER SHARE - Schedule of Antidilutive Securities (Details) - $ / shares | 3 Months Ended | ||||
Sep. 30, 2023 | Sep. 30, 2022 | Jun. 07, 2023 | May 31, 2023 | Jul. 13, 2021 | |
Earnings Per Share [Abstract] | |||||
Warrants, exercise price (in dollars per share) | $ 115 | $ 115 | $ 115 | ||
Warrant right to purchase shares (in shares) | 0.1 | 0.1 | 0.1 | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Anti-dilutive securities (in shares) | 6,530,556 | 6,000,003 | |||
Warrants | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Anti-dilutive securities (in shares) | 1,252,149 | 1,252,149 | |||
Earnout Shares | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Anti-dilutive securities (in shares) | 900,000 | 900,000 | |||
RSUs | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Anti-dilutive securities (in shares) | 3,109,823 | 2,432,789 | |||
Stock options | |||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||
Anti-dilutive securities (in shares) | 1,268,584 | 1,415,066 |