Wheels Up Experience Inc. (UP)·Q2 2025 Earnings Summary

Executive Summary

• Q2 2025 revenue was $189.6M, down 3% YoY but up sequentially from Q1; gross profit turned positive at $2.2M (+$13.2M YoY) as fleet modernization and “more profitable flying” improved unit economics .
• Adjusted Contribution Margin rose to 12.2% (+4 pp YoY) and Adjusted EBITDA loss improved 22% YoY to $(29.0)M, though net loss remained sizable at $(82.3)M or $(0.12) per share (15% YoY improvement) .
• Strategic execution: premium Phenom/Challenger jets reached ~20% of controlled fleet; 3 Challenger 300 aircraft expected to enter revenue service in Q3 2025; initiatives targeting ~$50M in annual cash cost savings with full impact beginning in H2 2026 .
• Delta partnership momentum: corporate membership fund sales grew >25% YoY; mix rose to 45% (+4 pts QoQ), reinforcing the commercial engine and potential catalysts for investor sentiment .
• Post-quarter actions: sold three non-core services businesses for ~$20M to sharpen focus and fund modernization; extended $100M undrawn revolver with Delta to Sept 20, 2026, supporting liquidity .

What Went Well and What Went Wrong

What Went Well

• Positive gross profit: $2.2M in Q2, a $13.2M YoY improvement as “more profitable flying” and higher Utility drove margin gains; Adjusted Contribution Margin rose to 12.2% (+4 pp YoY) .
• Fleet modernization progress: premium Phenom/Challenger jets ~20% of fleet; retiring legacy aircraft and exiting CJ3; expected addition of three Challenger 300s into Q3 revenue service .
• Delta partnership traction: “corporate membership fund sales exceeded expectations and increased more than 25% year over year” and mix reached 45% (+4 pts QoQ), bolstering enterprise demand .

Quote (CEO): “This focused execution has strengthened our financial position and laid a strong foundation for sustained, profitable growth… as we scale our premium jet offering, deepen our collaboration with Delta, and drive greater productivity and efficiency” .

What Went Wrong

• Membership revenue pressure: Q2 membership revenue fell 53% YoY to $7.5M, reflecting program changes and mix-shifts away from certain legacy products .
• On-time performance softness: Q2 On-Time Performance (D-60) was 88%, down from 91% in Q2 2024, amid operational transition activities (note method change includes wholesale flights) .
• Cash burn and leverage: H1 2025 operating cash outflow was $(110.8)M; interest expense rose 33% YoY in Q2; cumulative equity remains negative, underscoring balance sheet constraints despite liquidity .

Financial Results

Segment Revenue Breakdown

Key KPIs

Guidance Changes

Note: No numeric revenue/EPS/EBITDA guidance ranges were provided for Q3/Q4 2025 in the documents.

Earnings Call Themes & Trends

Note: No Q2 2025 earnings call transcript was available in the repository; themes reflect the press release and investor letter .

Management Commentary

• Strategic message: “Realigning our product, fleet, and operations to better meet customer demand… as we scale our premium jet offering, deepen our collaboration with Delta, and drive greater productivity and efficiency” (George Mattson, CEO) .
• Fleet transition progress: retirement of Citation CJ3; premium Phenom/Challenger jets ~20% of fleet; adding three Challenger 300s in Q3 2025 .
• Commercial engine: corporate membership fund sales +25% YoY; mix 45% in the quarter, up 4 pts sequentially .
• Cash savings trajectory: initiatives expected to drive ~$50M annual cash cost savings, with full impact beginning H2 2026 .
• Liquidity: “over $200 million in liquidity,” comprising $107M cash/cash equivalents and $100M undrawn revolver .

Q&A Highlights

• The Q2 2025 earnings call transcript was not available in the document repository; no Q&A details to report .
• Key clarifications from published materials: cost savings timing (full impact beginning H2 2026), fleet additions (3 Challenger 300s in Q3), and inclusion of wholesale flights in reported on-time/completion metrics .

Estimates Context

• S&P Global consensus estimates were unavailable for UP for Q2 2025 (Primary EPS, Revenue, Target Price, Recommendation not populated); coverage appears limited at present. Management comparisons are therefore vs prior periods rather than vs published Street expectations [GetEstimates output].
• Reported results: Revenue $189.6M, Adjusted EBITDA $(29.0)M, Diluted EPS $(0.12); without Wall Street consensus, estimate-adjustment implications hinge on continued margin expansion and cost savings execution .

Values retrieved from S&P Global where applicable.*

Key Takeaways for Investors

• Margin trajectory improving: gross profit turned positive; ACM sustained >12% as Utility rose to 41.1 hours—evidence fleet modernization is lifting unit economics .
• Corporate demand channel: Delta partnership driving >25% YoY growth in corporate fund sales and rising mix—supports stickier, programmatic demand .
• 2H/2026 operating leverage: ~$50M annual cash cost savings initiatives should progressively reduce cash burn; monitor timing and realization milestones .
• Near-term operational watch items: on-time performance at 88% amid transition; continued progress expected as more premium aircraft enter service .
• Balance sheet: liquidity remains solid (> $200M), aided by $100M undrawn revolver; divestiture of non-core businesses adds ~$20M to fund modernization .
• Mix dynamics: membership revenue weakness (-53% YoY) is offset by Flight and Other categories; investors should track the new Signature Membership launch to stabilize membership monetization .
• Trade setup: catalysts include Challenger fleet ramp in Q3, cost savings execution, and corporate sales momentum via Delta; risks include execution timing, cash burn, and operational reliability during transition .