Jet fuel call option agreements | Jet fuel call option spread agreements | Total | ||||||
First Quarter 2019 | 7 | % | — | % | 7 | % | ||
Second Quarter 2019 | 7 | % | — | % | 7 | % | ||
Third Quarter 2019 | — | % | — | % | — | % | ||
Fourth Quarter 2019 | — | % | — | % | — | % |
December 31, 2018 | December 31, 2017 | |||||||||||||||
Carrying Value | Estimated Fair Value | Carrying Value | Estimated Fair Value | |||||||||||||
Public Debt | ||||||||||||||||
Fixed rate special facility bonds, due through 2036 | $ | 42 | $ | 44 | $ | 42 | $ | 46 | ||||||||
Non-Public Debt | ||||||||||||||||
Fixed rate enhanced equipment notes, due through 2023 | 151 | 153 | 169 | 178 | ||||||||||||
Floating rate equipment notes, due through 2028 | 245 | 245 | 152 | 159 | ||||||||||||
Fixed rate equipment notes, due through 2028 | 1,125 | 1,135 | 712 | 771 | ||||||||||||
Total(1) | $ | 1,563 | $ | 1,577 | $ | 1,075 | $ | 1,154 |
Balance at beginning of period | Additions Charged to Costs and Expenses | Deductions | Balance at end of period | |||||||||||||
Year Ended December 31, 2018 | ||||||||||||||||
Valuation allowance for deferred tax assets | $ | 1 | $ | 20 | $ | — | $ | 21 | ||||||||
Allowance for obsolete inventory parts | 14 | 4 | — | (1) | 18 | |||||||||||
Allowance for doubtful accounts | 1 | 2 | 2 | (2) | 1 | |||||||||||
Total | 16 | 26 | 2 | 40 | ||||||||||||
Year Ended December 31, 2017 | ||||||||||||||||
Valuation allowance for deferred tax assets | $ | — | $ | 1 | $ | — | $ | 1 | ||||||||
Allowance for obsolete inventory parts | 12 | 2 | — | (1) | 14 | |||||||||||
Allowance for doubtful accounts | 5 | — | 4 | (2) | 1 | |||||||||||
Total | 17 | 3 | 4 | 16 | ||||||||||||
Year Ended December 31, 2016 | ||||||||||||||||
Valuation allowance for deferred tax assets | $ | — | $ | — | $ | — | $ | — | ||||||||
Allowance for obsolete inventory parts | 10 | 2 | — | (1) | 12 | |||||||||||
Allowance for doubtful accounts | 6 | — | 1 | (2) | 5 | |||||||||||
Total | 16 | 2 | 1 | 17 |
(1) | Inventory scrapped. |
(2) | Uncollectible accounts written off, net of recoveries. |
Aircraft Fuel Derivatives(1) | Interest Rate Swaps(2) | Total | ||||||||||
Balance of accumulated income (losses), at December 31, 2015 | $ | (4 | ) | $ | 1 | $ | (3 | ) | ||||
Reclassifications into earnings, net of tax benefit of $4 | (5 | ) | (1 | ) | (6 | ) | ||||||
Change in fair value, net of tax (expense) of $(12) | 22 | — | 22 | |||||||||
Balance of accumulated income, at December 31, 2016 | 13 | — | 13 | |||||||||
Reclassifications into earnings, net of tax benefit of $6 | (9 | ) | — | (9 | ) | |||||||
Change in fair value, net of tax benefit of $2 | (4 | ) | — | (4 | ) | |||||||
Balance of accumulated income, at December 31, 2017 | — | — | — | |||||||||
Reclassifications into earnings, net of tax benefit of $0 | 1 | — | 1 | |||||||||
Change in fair value, net of tax benefit of $2 | (4 | ) | — | (4 | ) | |||||||
Balance of accumulated (losses), at December 31, 2018 | $ | (3 | ) | $ | — | $ | (3 | ) |
(1) | Reclassified to aircraft fuel expense |
(2) | Reclassified to interest expense |
(in millions) | December 31, 2018 | December 31, 2017 | |||||
Air traffic liability - passenger travel | $ | 892 | $ | 836 | |||
Air traffic liability - loyalty program (air transportation) | 580 | 502 | |||||
Deferred revenue | 10 | 13 | |||||
Total | $ | 1,482 | $ | 1,351 |
Balance at December 31, 2016 | $ | 417 | |
TrueBlue® points redeemed | (102 | ) | |
TrueBlue® points earned and sold | 187 | ||
Balance at December 31, 2017 | $ | 502 | |
TrueBlue® points redeemed | (160 | ) | |
TrueBlue® points earned and sold | 238 | ||
Balance at December 31, 2018 | $ | 580 |
2018 | 2017 | |||||||||||||
Secured Debt | ||||||||||||||
Floating rate equipment notes, due through 2028(1) | $ | 247 | 4.9 | % | $ | 153 | 4.7 | % | ||||||
Fixed rate enhanced equipment notes, due through 2023(2) | 152 | 4.5 | % | 171 | 4.5 | % | ||||||||
Fixed rate equipment notes, due through 2028(3) | 1,131 | 4.7 | % | 716 | 5.4 | % | ||||||||
Fixed rate specialty bonds, due through 2036(4) | 43 | 4.9 | % | 43 | 4.9 | % | ||||||||
Capital Leases(5) | 107 | 4.7 | % | 124 | 4.5 | % | ||||||||
Total debt and capital lease obligations | 1,680 | 1,207 | ||||||||||||
Less: Current maturities | (309 | ) | (196 | ) | ||||||||||
Less: Debt acquisition cost | (10 | ) | (8 | ) | ||||||||||
Long-term debt and capital lease obligations | $ | 1,361 | $ | 1,003 |
Year | Maturities | |||
2019 | $ | 306 | ||
2020 | 273 | |||
2021 | 262 | |||
2022 | 240 | |||
2023 | 223 | |||
Thereafter | 366 |
December 31, 2018 | December 31, 2017 | |||||||||||||||
Carrying Value | Estimated Fair Value | Carrying Value | Estimated Fair Value | |||||||||||||
Public Debt | ||||||||||||||||
Fixed rate special facility bonds, due through 2036 | $ | 42 | $ | 44 | $ | 42 | $ | 46 | ||||||||
Non-Public Debt | ||||||||||||||||
Fixed rate enhanced equipment notes, due through 2023 | 151 | 153 | 169 | 178 | ||||||||||||
Floating rate equipment notes, due through 2028 | 245 | 245 | 152 | 159 | ||||||||||||
Fixed rate equipment notes, due through 2028 | 1,125 | 1,135 | 712 | 771 | ||||||||||||
Total(1) | $ | 1,563 | $ | 1,577 | $ | 1,075 | $ | 1,154 |
Jet fuel call option agreements | Jet fuel call option spread agreements | Total | ||||||
First Quarter 2019 | 7 | % | — | % | 7 | % | ||
Second Quarter 2019 | 7 | % | — | % | 7 | % | ||
Third Quarter 2019 | — | % | — | % | — | % | ||
Fourth Quarter 2019 | — | % | — | % | — | % |
As of December 31, | ||||||||
2018 | 2017 | |||||||
Fuel derivatives | ||||||||
Asset fair value recorded in prepaid expenses and other(1) | $ | — | $ | — | ||||
Longest remaining term (months) | 6 | — | ||||||
Hedged volume (barrels, in thousands) | 756 | — | ||||||
Estimated amount of existing (gains) losses expected to be reclassified into earnings in the next 12 months | $ | 4 | $ | — |
2018 | 2017 | 2016 | ||||||||||
Fuel derivatives | ||||||||||||
Hedge effectiveness (gains) losses recognized in aircraft fuel expense | $ | 2 | $ | (15 | ) | $ | (9 | ) | ||||
Hedge (gains) losses on derivatives recognized in comprehensive income | $ | 6 | $ | 6 | $ | (34 | ) | |||||
Percentage of actual consumption economically hedged | 4 | % | 10 | % | 12 | % |
(1) | Gross asset of each contract prior to consideration of offsetting positions with each counterparty and prior to impact of collateral paid. |
2018 | 2017 | 2016 | |||||||||
Passenger revenue | |||||||||||
Passenger travel | $ | 7,221 | $ | 6,659 | $ | 6,324 | |||||
Loyalty revenue - air transportation | 160 | 102 | 56 | ||||||||
Other Revenue | |||||||||||
Loyalty revenue | 168 | 140 | 92 | ||||||||
Other revenue | 109 | 111 | 112 | ||||||||
Total revenue | $ | 7,658 | $ | 7,012 | $ | 6,584 |
Shares | Weighted Average Grant Date Fair Value | ||||||
Nonvested at beginning of year | 1.6 | $ | 20.14 | ||||
Granted | 1.1 | 20.62 | |||||
Vested | (0.8 | ) | 19.71 | ||||
Forfeited | (0.2 | ) | 20.51 | ||||
Nonvested at end of year | 1.7 | $ | 20.59 |
2018 | 2017 | 2016 | ||||||||||
Numerator: | ||||||||||||
Net income | $ | 188 | $ | 1,125 | $ | 727 | ||||||
Effect of dilutive securities: | ||||||||||||
Interest on convertible debt, net of income taxes and profit sharing | — | — | 2 | |||||||||
Net income applicable to common stockholders after assumed conversions for diluted earnings per share | $ | 188 | $ | 1,125 | $ | 729 | ||||||
Denominator: | ||||||||||||
Weighted average shares outstanding for basic earnings per share | 312.9 | 328.7 | 326.5 | |||||||||
Effect of dilutive securities: | ||||||||||||
Employee stock options and restricted stock units | 1.6 | 1.7 | 2.1 | |||||||||
Convertible debt | — | — | 13.6 | |||||||||
Adjusted weighted average shares outstanding and assumed conversions for diluted earnings per share | 314.5 | 330.4 | 342.2 |
As of December 31, 2018 | ||||||||||||||||
Assets | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Cash equivalents | $ | 198 | $ | — | $ | — | $ | 198 | ||||||||
Available-for-sale investment securities | 39 | 197 | — | 236 | ||||||||||||
Aircraft fuel derivatives | — | — | — | — |
As of December 31, 2017 | ||||||||||||||||
Assets | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Cash equivalents | $ | 173 | $ | — | $ | — | $ | 173 | ||||||||
Available-for-sale investment securities | — | 136 | — | 136 |
2018 | 2017 | 2016 | ||||||||||
Deferred: | ||||||||||||
Federal | $ | 82 | $ | (344 | ) | $ | 227 | |||||
State | 7 | 24 | 24 | |||||||||
Foreign | 1 | 23 | — | |||||||||
Deferred income tax (benefit) expense | 90 | (297 | ) | 251 | ||||||||
Current: | ||||||||||||
Federal | (60 | ) | 93 | 129 | ||||||||
State | (5 | ) | 18 | 26 | ||||||||
Foreign | 6 | (25 | ) | 31 | ||||||||
Current income tax (benefit) expense | (59 | ) | 86 | 186 | ||||||||
Total income tax (benefit) expense | $ | 31 | $ | (211 | ) | $ | 437 |
2018 | 2017 | 2016 | ||||||||||
Income tax expense at statutory rate | $ | 46 | $ | 319 | $ | 407 | ||||||
State income tax, net of federal benefit | 8 | 27 | 32 | |||||||||
Adjustment of net deferred tax liability from enacted tax rate change | (28 | ) | (551 | ) | — | |||||||
Nondeductible expenses | 7 | 4 | 4 | |||||||||
Foreign rate differential | (2 | ) | (7 | ) | (1 | ) | ||||||
Other, net | — | (3 | ) | (5 | ) | |||||||
Total income tax (benefit) expense | $ | 31 | $ | (211 | ) | $ | 437 |
2018 | 2017 | |||||||
Deferred tax assets: | ||||||||
Deferred revenue/gains | $ | 106 | $ | 129 | ||||
Employee benefits | 35 | 32 | ||||||
Foreign tax credit | 32 | 23 | ||||||
Net operating loss carryforward | 28 | — | ||||||
Terminal 5 lease | 28 | 45 | ||||||
Rent expense | 20 | 22 | ||||||
Other | 11 | 7 | ||||||
Total deferred tax assets | 260 | 258 | ||||||
Valuation allowance | (21 | ) | (1 | ) | ||||
Deferred tax assets, net | 239 | 257 | ||||||
Deferred tax liabilities: | ||||||||
Accelerated depreciation | (1,327 | ) | (1,256 | ) | ||||
Total deferred tax liabilities | (1,327 | ) | (1,256 | ) | ||||
Net deferred tax liability | $ | (1,088 | ) | $ | (999 | ) |
2018 | 2017 | 2016 | ||||||||||
Unrecognized tax benefits at January 1, | $ | 31 | $ | 26 | $ | 21 | ||||||
Increases for tax positions taken during a prior period | — | 2 | 10 | |||||||||
Increases for tax positions taken during the period | 5 | 6 | 5 | |||||||||
Decreases for tax positions taken during a prior period | (3 | ) | (3 | ) | (4 | ) | ||||||
Decreases for settlement with tax authorities during the period | — | — | (6 | ) | ||||||||
Unrecognized tax benefits December 31, | $ | 33 | $ | 31 | $ | 26 |
Aircraft | Other | Total | ||||||||||
2019 | $ | 54 | $ | 105 | $ | 159 | ||||||
2020 | 52 | 86 | 138 | |||||||||
2021 | 46 | 78 | 124 | |||||||||
2022 | 41 | 72 | 113 | |||||||||
2023 | 45 | 64 | 109 | |||||||||
Thereafter | 67 | 379 | 446 | |||||||||
Total minimum operating lease payments | $ | 305 | $ | 784 | $ | 1,089 |
December 31, 2018 | December 31, 2017 | |||||||
Available-for-sale securities | ||||||||
Time deposits | $ | 190 | $ | 130 | ||||
U.S. Treasury | 39 | — | ||||||
Debt securities | 7 | 6 | ||||||
Total available-for-sale securities | 236 | 136 | ||||||
Held-to-maturity securities | ||||||||
U.S. Treasury | 180 | 220 | ||||||
Corporate bonds | — | 36 | ||||||
Total held-to-maturity securities | 180 | 256 | ||||||
Total investment securities | $ | 416 | $ | 392 |
December 31, 2018 | December 31, 2017 | |||||||
Available-for-sale securities | ||||||||
Time deposits | $ | 190 | $ | 130 | ||||
U.S. Treasury | 39 | — | ||||||
Debt securities | 7 | 6 | ||||||
Total available-for-sale securities | 236 | 136 | ||||||
Held-to-maturity securities | ||||||||
U.S. Treasury | 180 | 220 | ||||||
Corporate bonds | — | 36 | ||||||
Total held-to-maturity securities | 180 | 256 | ||||||
Total investment securities | $ | 416 | $ | 392 |
Property and Equipment Type | Estimated Useful Life | Residual Value | |||
Aircraft | 25 years | 20 | % | ||
In-flight entertainment systems | 5-10 years | 0 | % | ||
Aircraft parts | Fleet life | 10 | % | ||
Flight equipment leasehold improvements | Lower of lease term or economic life | 0 | % | ||
Ground property and equipment | 2-10 years | 0 | % | ||
Leasehold improvements—other | Lower of lease term or economic life | 0 | % | ||
Buildings on leased land | Lease term | 0 | % |
Property and Equipment Type | Estimated Useful Life | Residual Value | |||
Aircraft | 25 years | 20 | % | ||
In-flight entertainment systems | 5-10 years | 0 | % | ||
Aircraft parts | Fleet life | 10 | % | ||
Flight equipment leasehold improvements | Lower of lease term or economic life | 0 | % | ||
Ground property and equipment | 2-10 years | 0 | % | ||
Leasehold improvements—other | Lower of lease term or economic life | 0 | % | ||
Buildings on leased land | Lease term | 0 | % |
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||||
2018 | ||||||||||||||||
Operating revenues | $ | 1,754 | $ | 1,928 | $ | 2,008 | $ | 1,968 | ||||||||
Operating income(1)(2)(3) | 128 | (144 | ) | 83 | 221 | |||||||||||
Net income(1)(2)(3)(4) | 88 | (120 | ) | 50 | 169 | |||||||||||
Basic earnings per share | $ | 0.28 | $ | (0.38 | ) | $ | 0.16 | $ | 0.55 | |||||||
Diluted earnings per share(1)(2)(3)(4) | $ | 0.27 | $ | (0.38 | ) | $ | 0.16 | $ | 0.55 | |||||||
2017 | ||||||||||||||||
Operating revenues | $ | 1,600 | $ | 1,836 | $ | 1,818 | $ | 1,758 | ||||||||
Operating income | 142 | 347 | 314 | 190 | ||||||||||||
Net income(5) | 82 | 207 | 181 | 654 | ||||||||||||
Basic earnings per share | $ | 0.25 | $ | 0.63 | $ | 0.56 | $ | 2.04 | ||||||||
Diluted earnings per share(5) | $ | 0.24 | $ | 0.62 | $ | 0.55 | $ | 2.03 |
2018 | 2017 | 2016 | |||||||||
Passenger revenue | |||||||||||
Passenger travel | $ | 7,221 | $ | 6,659 | $ | 6,324 | |||||
Loyalty revenue - air transportation | 160 | 102 | 56 | ||||||||
Other Revenue | |||||||||||
Loyalty revenue | 168 | 140 | 92 | ||||||||
Other revenue | 109 | 111 | 112 | ||||||||
Total revenue | $ | 7,658 | $ | 7,012 | $ | 6,584 |
(in millions) | December 31, 2018 | December 31, 2017 | |||||
Air traffic liability - passenger travel | $ | 892 | $ | 836 | |||
Air traffic liability - loyalty program (air transportation) | 580 | 502 | |||||
Deferred revenue | 10 | 13 | |||||
Total | $ | 1,482 | $ | 1,351 |
Balance at December 31, 2016 | $ | 417 | |
TrueBlue® points redeemed | (102 | ) | |
TrueBlue® points earned and sold | 187 | ||
Balance at December 31, 2017 | $ | 502 | |
TrueBlue® points redeemed | (160 | ) | |
TrueBlue® points earned and sold | 238 | ||
Balance at December 31, 2018 | $ | 580 |
Aircraft Fuel Derivatives(1) | Interest Rate Swaps(2) | Total | ||||||||||
Balance of accumulated income (losses), at December 31, 2015 | $ | (4 | ) | $ | 1 | $ | (3 | ) | ||||
Reclassifications into earnings, net of tax benefit of $4 | (5 | ) | (1 | ) | (6 | ) | ||||||
Change in fair value, net of tax (expense) of $(12) | 22 | — | 22 | |||||||||
Balance of accumulated income, at December 31, 2016 | 13 | — | 13 | |||||||||
Reclassifications into earnings, net of tax benefit of $6 | (9 | ) | — | (9 | ) | |||||||
Change in fair value, net of tax benefit of $2 | (4 | ) | — | (4 | ) | |||||||
Balance of accumulated income, at December 31, 2017 | — | — | — | |||||||||
Reclassifications into earnings, net of tax benefit of $0 | 1 | — | 1 | |||||||||
Change in fair value, net of tax benefit of $2 | (4 | ) | — | (4 | ) | |||||||
Balance of accumulated (losses), at December 31, 2018 | $ | (3 | ) | $ | — | $ | (3 | ) |
(1) | Reclassified to aircraft fuel expense |
(2) | Reclassified to interest expense |
2018 | 2017 | 2016 | ||||||||||
Deferred: | ||||||||||||
Federal | $ | 82 | $ | (344 | ) | $ | 227 | |||||
State | 7 | 24 | 24 | |||||||||
Foreign | 1 | 23 | — | |||||||||
Deferred income tax (benefit) expense | 90 | (297 | ) | 251 | ||||||||
Current: | ||||||||||||
Federal | (60 | ) | 93 | 129 | ||||||||
State | (5 | ) | 18 | 26 | ||||||||
Foreign | 6 | (25 | ) | 31 | ||||||||
Current income tax (benefit) expense | (59 | ) | 86 | 186 | ||||||||
Total income tax (benefit) expense | $ | 31 | $ | (211 | ) | $ | 437 |
2018 | 2017 | |||||||||||||
Secured Debt | ||||||||||||||
Floating rate equipment notes, due through 2028(1) | $ | 247 | 4.9 | % | $ | 153 | 4.7 | % | ||||||
Fixed rate enhanced equipment notes, due through 2023(2) | 152 | 4.5 | % | 171 | 4.5 | % | ||||||||
Fixed rate equipment notes, due through 2028(3) | 1,131 | 4.7 | % | 716 | 5.4 | % | ||||||||
Fixed rate specialty bonds, due through 2036(4) | 43 | 4.9 | % | 43 | 4.9 | % | ||||||||
Capital Leases(5) | 107 | 4.7 | % | 124 | 4.5 | % | ||||||||
Total debt and capital lease obligations | 1,680 | 1,207 | ||||||||||||
Less: Current maturities | (309 | ) | (196 | ) | ||||||||||
Less: Debt acquisition cost | (10 | ) | (8 | ) | ||||||||||
Long-term debt and capital lease obligations | $ | 1,361 | $ | 1,003 |
2018 | 2017 | |||||||
Deferred tax assets: | ||||||||
Deferred revenue/gains | $ | 106 | $ | 129 | ||||
Employee benefits | 35 | 32 | ||||||
Foreign tax credit | 32 | 23 | ||||||
Net operating loss carryforward | 28 | — | ||||||
Terminal 5 lease | 28 | 45 | ||||||
Rent expense | 20 | 22 | ||||||
Other | 11 | 7 | ||||||
Total deferred tax assets | 260 | 258 | ||||||
Valuation allowance | (21 | ) | (1 | ) | ||||
Deferred tax assets, net | 239 | 257 | ||||||
Deferred tax liabilities: | ||||||||
Accelerated depreciation | (1,327 | ) | (1,256 | ) | ||||
Total deferred tax liabilities | (1,327 | ) | (1,256 | ) | ||||
Net deferred tax liability | $ | (1,088 | ) | $ | (999 | ) |
As of December 31, | ||||||||
2018 | 2017 | |||||||
Fuel derivatives | ||||||||
Asset fair value recorded in prepaid expenses and other(1) | $ | — | $ | — | ||||
Longest remaining term (months) | 6 | — | ||||||
Hedged volume (barrels, in thousands) | 756 | — | ||||||
Estimated amount of existing (gains) losses expected to be reclassified into earnings in the next 12 months | $ | 4 | $ | — |
2018 | 2017 | 2016 | ||||||||||
Fuel derivatives | ||||||||||||
Hedge effectiveness (gains) losses recognized in aircraft fuel expense | $ | 2 | $ | (15 | ) | $ | (9 | ) | ||||
Hedge (gains) losses on derivatives recognized in comprehensive income | $ | 6 | $ | 6 | $ | (34 | ) | |||||
Percentage of actual consumption economically hedged | 4 | % | 10 | % | 12 | % |
(1) | Gross asset of each contract prior to consideration of offsetting positions with each counterparty and prior to impact of collateral paid. |
2018 | 2017 | 2016 | ||||||||||
Numerator: | ||||||||||||
Net income | $ | 188 | $ | 1,125 | $ | 727 | ||||||
Effect of dilutive securities: | ||||||||||||
Interest on convertible debt, net of income taxes and profit sharing | — | — | 2 | |||||||||
Net income applicable to common stockholders after assumed conversions for diluted earnings per share | $ | 188 | $ | 1,125 | $ | 729 | ||||||
Denominator: | ||||||||||||
Weighted average shares outstanding for basic earnings per share | 312.9 | 328.7 | 326.5 | |||||||||
Effect of dilutive securities: | ||||||||||||
Employee stock options and restricted stock units | 1.6 | 1.7 | 2.1 | |||||||||
Convertible debt | — | — | 13.6 | |||||||||
Adjusted weighted average shares outstanding and assumed conversions for diluted earnings per share | 314.5 | 330.4 | 342.2 |
2018 | 2017 | 2016 | ||||||||||
Income tax expense at statutory rate | $ | 46 | $ | 319 | $ | 407 | ||||||
State income tax, net of federal benefit | 8 | 27 | 32 | |||||||||
Adjustment of net deferred tax liability from enacted tax rate change | (28 | ) | (551 | ) | — | |||||||
Nondeductible expenses | 7 | 4 | 4 | |||||||||
Foreign rate differential | (2 | ) | (7 | ) | (1 | ) | ||||||
Other, net | — | (3 | ) | (5 | ) | |||||||
Total income tax (benefit) expense | $ | 31 | $ | (211 | ) | $ | 437 |
As of December 31, 2018 | ||||||||||||||||
Assets | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Cash equivalents | $ | 198 | $ | — | $ | — | $ | 198 | ||||||||
Available-for-sale investment securities | 39 | 197 | — | 236 | ||||||||||||
Aircraft fuel derivatives | — | — | — | — |
As of December 31, 2017 | ||||||||||||||||
Assets | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Cash equivalents | $ | 173 | $ | — | $ | — | $ | 173 | ||||||||
Available-for-sale investment securities | — | 136 | — | 136 |
Aircraft | Other | Total | ||||||||||
2019 | $ | 54 | $ | 105 | $ | 159 | ||||||
2020 | 52 | 86 | 138 | |||||||||
2021 | 46 | 78 | 124 | |||||||||
2022 | 41 | 72 | 113 | |||||||||
2023 | 45 | 64 | 109 | |||||||||
Thereafter | 67 | 379 | 446 | |||||||||
Total minimum operating lease payments | $ | 305 | $ | 784 | $ | 1,089 |
Year | Maturities | |||
2019 | $ | 306 | ||
2020 | 273 | |||
2021 | 262 | |||
2022 | 240 | |||
2023 | 223 | |||
Thereafter | 366 |
First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||||
2018 | ||||||||||||||||
Operating revenues | $ | 1,754 | $ | 1,928 | $ | 2,008 | $ | 1,968 | ||||||||
Operating income(1)(2)(3) | 128 | (144 | ) | 83 | 221 | |||||||||||
Net income(1)(2)(3)(4) | 88 | (120 | ) | 50 | 169 | |||||||||||
Basic earnings per share | $ | 0.28 | $ | (0.38 | ) | $ | 0.16 | $ | 0.55 | |||||||
Diluted earnings per share(1)(2)(3)(4) | $ | 0.27 | $ | (0.38 | ) | $ | 0.16 | $ | 0.55 | |||||||
2017 | ||||||||||||||||
Operating revenues | $ | 1,600 | $ | 1,836 | $ | 1,818 | $ | 1,758 | ||||||||
Operating income | 142 | 347 | 314 | 190 | ||||||||||||
Net income(5) | 82 | 207 | 181 | 654 | ||||||||||||
Basic earnings per share | $ | 0.25 | $ | 0.63 | $ | 0.56 | $ | 2.04 | ||||||||
Diluted earnings per share(5) | $ | 0.24 | $ | 0.62 | $ | 0.55 | $ | 2.03 |
2018 | 2017 | 2016 | ||||||||||
Domestic | $ | 5,386 | $ | 4,999 | $ | 4,717 | ||||||
Caribbean & Latin America | 2,272 | 2,013 | 1,867 | |||||||||
Total | $ | 7,658 | $ | 7,012 | $ | 6,584 |
Shares | Weighted Average Grant Date Fair Value | ||||||
Nonvested at beginning of year | 1.6 | $ | 20.14 | ||||
Granted | 1.1 | 20.62 | |||||
Vested | (0.8 | ) | 19.71 | ||||
Forfeited | (0.2 | ) | 20.51 | ||||
Nonvested at end of year | 1.7 | $ | 20.59 |
Year Ended December 31, | ||||||||||||
Special Items | 2018 | 2017 | 2016 | |||||||||
Embraer E190 fleet transition costs(1) | $ | 362 | $ | — | $ | — | ||||||
Union contract costs(2) | 73 | — | — | |||||||||
Total | $ | 435 | $ | — | $ | — |
2018 | 2017 | 2016 | ||||||||||
Domestic | $ | 5,386 | $ | 4,999 | $ | 4,717 | ||||||
Caribbean & Latin America | 2,272 | 2,013 | 1,867 | |||||||||
Total | $ | 7,658 | $ | 7,012 | $ | 6,584 |
December 31, 2018 | December 31, 2017 | |||||||
Available-for-sale securities | ||||||||
Time deposits | $ | 190 | $ | 130 | ||||
U.S. Treasury | 39 | — | ||||||
Debt securities | 7 | 6 | ||||||
Total available-for-sale securities | 236 | 136 | ||||||
Held-to-maturity securities | ||||||||
U.S. Treasury | 180 | 220 | ||||||
Corporate bonds | — | 36 | ||||||
Total held-to-maturity securities | 180 | 256 | ||||||
Total investment securities | $ | 416 | $ | 392 |
Property and Equipment Type | Estimated Useful Life | Residual Value | |||
Aircraft | 25 years | 20 | % | ||
In-flight entertainment systems | 5-10 years | 0 | % | ||
Aircraft parts | Fleet life | 10 | % | ||
Flight equipment leasehold improvements | Lower of lease term or economic life | 0 | % | ||
Ground property and equipment | 2-10 years | 0 | % | ||
Leasehold improvements—other | Lower of lease term or economic life | 0 | % | ||
Buildings on leased land | Lease term | 0 | % |
2018 | 2017 | 2016 | ||||||||||
Unrecognized tax benefits at January 1, | $ | 31 | $ | 26 | $ | 21 | ||||||
Increases for tax positions taken during a prior period | — | 2 | 10 | |||||||||
Increases for tax positions taken during the period | 5 | 6 | 5 | |||||||||
Decreases for tax positions taken during a prior period | (3 | ) | (3 | ) | (4 | ) | ||||||
Decreases for settlement with tax authorities during the period | — | — | (6 | ) | ||||||||
Unrecognized tax benefits December 31, | $ | 33 | $ | 31 | $ | 26 |
Year Ended December 31, | ||||||||||||
Special Items | 2018 | 2017 | 2016 | |||||||||
Embraer E190 fleet transition costs(1) | $ | 362 | $ | — | $ | — | ||||||
Union contract costs(2) | 73 | — | — | |||||||||
Total | $ | 435 | $ | — | $ | — |