Quarterly Revenue Growth
Total operating revenues for Q4 2025 were $882 million, up 5.6% year-over-year, driven by TRASM recovery in the back half of the year.
Controladora Vuela Compania de Aviacion SAB de CV
· VLRS
February 24th, 2026
Summary
- Earnings Call Date:
- 2026-02-24
- Change Since:
- -2.84%
- Next Earnings Date:
- 2026-07-27
Earnings Call Sentiment
NeutralThe call presented a mixed but cautiously constructive view: Volaris delivered strong quarter-level revenue recovery, robust ancillary performance, healthy liquidity and clear 2026 guidance while outlining a concrete plan to reduce aircraft-on-ground levels and restore fleet productivity. However, full-year results show a revenue decline and a sizeable net loss driven primarily by engine-related groundings, elevated maintenance and redelivery costs, and increased near-term CapEx. Management emphasized disciplined capacity management, recovery of AOGs, and structural strengths of the ultra-low-cost model, suggesting improving fundamentals through 2026 once engine availability normalizes.
Company Guidance
Volaris guided to full‑year 2026 ASM growth of about 7%, an EBITDAR margin around 33%, and CapEx (net of finance fleet predelivery payments) of roughly $350 million, assuming an average FX rate of MXN 17.7/USD and Gulf Coast jet fuel of $2.10–2.20/gal; roughly two‑thirds of 2026 capacity growth will be allocated to cross‑border markets (international capacity ≈42% of total). Management expects AOGs to improve to ~25 at year‑end (full‑year average ≈33 AOGs, implying three more aircraft back in service vs. 2025), net debt/EBITDAR to deleverage from 3.1x to ~2.6x by year‑end, and to maintain liquidity above its 20% target (Q4 liquidity was $774M, 25.5% of LTM revenues). For Q1 2026 they guided ASM ≈3% y/y, TRASM ≈ $0.085, CASM ex fuel ≈ $0.06 (FX at MXN 17.5/USD adds ~ $0.004 to CASM ex), EBITDAR margin ≈25%, and jet fuel ≈ $2.20/gal, while flagging ~ $0.22 of nonrecurring unit cost impact in the quarter related to accelerated engine inductions and one‑time merger expenses and plans to induct roughly twice as many engines in 2026 versus 2025.
Strong Q4 Profitability and Margins
Q4 EBITDAR was $328 million with a 37.2% margin; Q4 EBIT was $100 million (11.3% margin) and net profit for the quarter was $4 million (EPS $0.04).
Robust Ancillary Revenue Performance
Ancillary revenues comprised 56% of total operating revenues; ancillary revenue per passenger increased ~6% versus 2024, supporting revenue quality and the ultra-low-cost model.
Liquidity and Conservative Cash Position
Total liquidity at quarter end was $774 million, representing 25.5% of last-12-months revenues, above the company target of at least 20%.
Cost Discipline and CASM ex-Fuel in Line with Plan
Full year CASM ex fuel was reported at $0.0558 (in line with plan). Q4 CASM was $0.0829 (up 3.2% YoY) and Q4 CASM ex fuel was ~$0.0576, up ~1.4% YoY — reflecting continued cost control despite headwinds.
Operational and Network Progress
Q4 capacity growth was 5.6%; international load factor improved to 79% (from 77.5% earlier) and domestic load factor reached 89.8%, showing demand resilience and disciplined supply management.
Clear 2026 Growth and Margin Guidance
Full-year 2026 guidance: ASM growth of ~7%, EBITDAR margin around 33%, and CapEx net of predelivery payments of approximately $350 million; Q1 2026 guidance includes ASM +3%, TRASM ~$0.085, CASM ex fuel ~$0.06 and Q1 EBITDAR margin ~25%.
Fleet Productivity Strategy and AOG Recovery Plan
Fleet of 155 aircraft (average age 6.6 years; 66% new models). Management expects a steady reduction in AOGs (averaged 36 in Q4, peaked 41 in January) to ~25 by year-end 2026 and expects to induct roughly twice as many engines into MROs in 2026 to accelerate returns to service.
Commercial Enhancements and Partnerships
New product (Premium+) ramping successfully since October; loyalty program 'altitude' reached ~800,000 enrollments in 7 months; codeshare revenues increased >30% in 2025; 33 new routes announced for summer expansion.
Operator
Good morning, everyone. Thank you for joining Volaris' Fourth Quarter and Full Year 2025 Financial Results Conference Call. [Operator Instructions] Please note that today's event is being recorded and webcast live on Volaris website. At this time, I'll turn the call over to Liliana Juarez, Investor Relations Manager. Please go ahead.
Unknown Executive
Welcome to our fourth quarter 2025 earnings call. Joining us today are our President and CEO, Enrique Beltranena; our Airline Executive Vice President, Holger Blankenstein; and our CFO, Jaime Pous. They will be discussing the company's results followed by a Q&A session. This call is for investors and analysts only. Please note that this call may include forward-looking statements under applicable securities laws. These are subject to several factors that could cause the company's results to differ materially as described in our filings with the U.S. SEC and Mexico CNBV. These statements speak only as of the date they are made, and Volaris undertakes no obligation to update or modify them.
All figures are in U.S. dollars compared to the fourth quarter of 2024, unless otherwise noted. And with that, I'll turn the call over to Enrique.
Enrique Javier Beltranena Mejicano
Good morning, everyone, and welcome to our fourth quarter 2025 earnings call. As ever, I'm proud of the disciplined execution, operational agility and commitment demonstrated across our organization throughout the past year. I especially want to thank our ambassadors for their hard work and resilience in what was a demanding environment. 2025 was both busy and historic for Volaris. We executed with precision across o...
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