Private aviation company Wheels Up reported record second-quarter revenue, crediting strong demand and “strong product market fit across our platform,” including a “great start” to the company’s recent acquisition of Air Partner, CEO Kenny Dichter said during a Thursday earnings call.
While the company noted continued leisure demand, it also saw a “steady pickup in business and corporate travel,” Wheels Up CFO Todd Smith said.
“When I look out and think about what’s out there, the travel managers and what people are saying [for] the fall, I think we see a lot of enthusiasm about people doing business travel,” Dichter said. “Overall demand remains solid, even as average pricing is increasing and fuel surcharges took effect. Our Core member retention continues to be robust, and our Core members continue to spend more than $80,000 per year with us on average.”
Core membership is one of the company's membership tiers. Smith said retention rates are approximately 80 percent for Core and Business members, and about 90 percent for those Core and Business members who purchased prepaid blocks.
Second-quarter revenue was $425.5 million, up 49 percent year over year. Prepaid block sales were “exceptionally strong” at more than $330 million, up 187 percent versus the prior year, and active members grew to nearly 12,700, up 20 percent from Q2 2021, and with a “higher mix of Core and Business members.”
Live flight legs for the quarter were more than 21,700, a 19 percent increase year over year. Still, the company reported a net loss of about $93 million, compared with a loss of $29 million one year prior.
Despite the quarterly loss, Wheels Up expects to report adjusted earnings before interest, taxes, depreciation and amortization profitability in 2024. For full-year 2022, revenue guidance is in the range of $1.48 billion to $1.53 billion, with third-quarter revenue expected to grow approximately 25 percent year over year, Smith said. Anticipated third-quarter adjusted EBITDA is in the range of negative $42 million to negative $47 million.
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