Financial Analysis

(5) Commitments and Contingencies Self-Insurance The Company self-insures a portion of its potential losses from claims related to workers compensation, environmental issues, property damage, medical insurance for employees and general liability. Losses are accrued based on an estimate of the ultimate aggregate liability for claims incurred, using standard industry practices and the Companys actual experience. The Company uses judgment and estimates in determining the ultimate aggregate liabilities for claims incurred in its workers compensation liability. The Company also used assumptions in determining the workers compensation liability such as an estimation of loss payment and loss reporting development patterns. At December 31, 2025 and 2024, the Companys accrued workers compensation liability totaled $19.1 million and $18.5 million, respectively, of which $9.8 million and $9.0 million, respectively, was short-term and included in other current liabilities. Actual results could differ from these estimates. Legal Matters The Company is subject to certain legal actions which it considers routine to its business activities. As of December 31, 2025, management believed, after consultation with legal counsel, that the ultimate outcome of such legal matters was not likely to have a material adverse effect on the Companys financial position, liquidity or results of operations. Concentration Risk and Significant Customers The Company requires no collateral from its major airline …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

(7) Fair Value Measurements The Company holds certain assets that are required to be measured at fair value in accordance with GAAP. The Company determined fair value of these assets based on the following three levels of inputs: Level 1 Quoted prices in active markets for identical assets or liabilities. Level 2 Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Some of the Companys marketable securities primarily utilize broker quotes in a non-active market for valuation of these securities. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities, therefore requiring an entity to develop its own assumptions. As of December 31, 2025 and 2024, the Company held certain assets that are required to be measured at fair value on a recurring basis. Assets measured at fair value on a recurring basis are summarized below (in thousands): Fair Value Measurements as of December 31, 2025 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ 487,699 $ $ 487,699 $ Commercial paper 96,537 96,537 584,236 584,236 Investments in Other Companies 4,253 4,253 Cash and Cash Equivalents 122,673 122,673 Total Assets Measured at Fair Value $ 711,16 …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

(4) Income Taxes The provision for income taxes includes the following components (in thousands): Year ended December 31, 2025 2024 2023 Current tax provision (benefit): Federal $ 4,838 $ 5,917 $ 4,962 State 9,350 2,776 1,794 14,188 8,693 6,756 Deferred tax provision (benefit): Federal 105,693 86,301 (678) State 17,376 14,187 (111) 123,069 100,488 (789) Provision for income taxes $ 137,257 $ 109,181 $ 5,967 The following is a reconciliation between the federal income tax rate of 21.0% and the effective tax rate which is derived by dividing the provision for income taxes by the income before income taxes (in thousands). As a result of adopting ASU 2023-09, the disaggregated components for the years ended December 31, 2024 and 2023 were recast to conform with the presentation for the 2025 year. Year ended December 31, 2025 2024 2023 Amount Percent Amount Percent Amount Percent U.S. federal statutory tax rate $ 118,774 21.0 % $ 90,750 21.0 % $ 8,465 21.0 % Domestic federal reconciling items: Tax credits (541) (0.1) % (107) 0.0 % (356) (0.9) % Nontaxable and nondeductible items, net: Section 162(m) limit on compensation 8,911 1.6 % 4,007 0.9 % 1,734 4.3 % Other employee non-deductible expenses 2,645 0.5 % 2,138 0.5 % 1,862 4.6 % Other 5 0.0 % (4) 0.0 % (15) 0.0 % Other reconciling items: Excess tax benefits from stock based compensation (11,784) (2.1) % (913) (0.2) % 939 2.3 % Other (894) (0.2) % (524) (0.1) % (523) (1.3) % Domestic state and local income taxes, net of federal be …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

(6) Leases The Company leases property and equipment under operating leases. For leases with durations longer than 12 months, the Company recorded the related operating lease right-of-use asset and operating lease liability at the present value of lease payments over the term. The Company used its incremental borrowing rate to discount the lease payments based on information available at lease commencement. Aircraft As of December 31, 2025, excluding aircraft financed by the Companys major airline partners that the Company operates for them under contract, the Company leased eight aircraft under long-term lease agreements with remaining terms ranging from three to five years. The Company is subleasing these eight aircraft to a third party. Airport facilities The Company has operating leases for facility space including airport terminals, office space, cargo warehouses and maintenance facilities. The Company generally leases this space from government agencies that control the use of the various airports. The remaining lease terms for facility space vary from one month to 31 years. The Companys operating leases with lease rates that are variable based on airport operating costs, use of the facilities or other variable factors are excluded from the Companys right-of-use assets and operating lease liabilities in accordance with accounting guidance. Leases As of December 31, 2025, the Companys right-of-use assets were $81.9 million, the Companys current maturities of operating le …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

(3) Long-term Debt Long-term debt consisted of the following as of December 31, 2025 and 2024 (in thousands): December 31, December 31, 2025 2024 Notes payable to banks, due in quarterly installments, plus interest at 2.33% to 5.95% through 2037, secured by aircraft $ 1,834,813 $ 2,055,330 Notes payable to banks, due in monthly or semi-annual installments, plus interest at 2.90% to 5.94% through 2032, secured by aircraft and engines 372,916 436,649 Notes payable to U.S. Government, interest due semi-annually and based on SOFR plus 2.0% through 2030, unsecured 105,210 Notes payable to U.S. Government, interest due semi-annually at 1.00% as of December 31, 2025 and 2024 and based on SOFR plus 2.0% from 2026 through 2031, unsecured 95,430 200,640 Long-term debt 2,408,369 2,692,619 Current portion of long-term debt (550,028) (539,061) Less long-term portion of unamortized debt issue cost, net (13,069) (16,772) Long-term debt, net of current maturities and debt issue costs $ 1,845,272 $ 2,136,786 Current portion of long-term debt $ 550,028 $ 539,061 Less current portion of unamortized debt issue cost, net (3,216) (3,472) Current portion of long-term debt, net of debt issue costs $ 546,812 $ 535,589 As of December 31, 2025, the Company had $2.4 billion of total long-term debt, which consisted of $2.2 billion of debt used to finance aircraft and engines and $200.6 million of unsecured debt payable to Treasury, of which $105.2 million is due in 2030 and $95.4 million is due in 2031. …

LongTermDebtTextBlock · excerpt; the full note is in the filing

Recent Accounting Pronouncements At December 31, 2025, the Company adopted Accounting Standards Update No. 2023-09 (ASU 2023-09), Income Taxes (ASC Topic 740) Improvements to Income Tax Disclosures, issued by the Financial Accounting Standards Board (FASB). The standard enhances the transparency, effectiveness and comparability of income tax disclosures by requiring consistent categories and greater disaggregation of information related to income tax rate reconciliations and the jurisdictions in which income taxes are paid. As required by the standard, the Company recast prior year disclosures to conform to the current year presentation. The adoption of this standard did not have a material impact on the Companys consolidated financial statements. For further details, refer to Note 4, Income Taxes . In March 2024, the FASB issued Accounting Standards Update No. 2024-03, Income Statement Reporting Comprehensive Income Expense Disaggregation Disclosures (ASC Subtopic 220-40) Disaggregation of Income Statement Expenses, which enhances the transparency and comparability of financial statements by requiring companies to disclose more granular information about expense components. As clarified in ASU 2025-01, Income StatementReporting Comprehensive IncomeExpense Disaggregation Disclosures (Subtopic 220-40): Clarifying the effective date, the guidance is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 1 …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

(2) Segment Reporting GAAP requires disclosures related to components of a company for which separate financial information is available to, and regularly evaluated by, the Companys chief operating decision maker when deciding how to allocate resources and in assessing performance. The Companys chief operating decision maker is the chief executive officer. The Companys two reportable segments consist of (1) the operations of SkyWest Airlines and SWC and (2) SkyWest Leasing activities. The Companys chief operating decision maker analyzes the profitability of operating aircraft separately from the profitability of the Companys capital deployed for new aircraft and the related aircraft financings, including the Companys E175 fleet. The SkyWest Airlines and SWC segment includes revenue earned under the applicable capacity purchase agreements attributed to operating such aircraft and the respective operating costs, and revenue and operating expenses attributed to prorate agreements and airport services agreements. The SkyWest Leasing segment includes applicable revenue earned under the applicable capacity purchase agreements attributed to the ownership of new aircraft acquired through the issuance of debt and the respective depreciation and interest expense of such aircraft. The SkyWest Leasing segment also includes the activity of leasing regional jet aircraft and spare engines to third parties and other activities. The SkyWest Leasing segments total assets and capital expenditur …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

(7) Leases, Commitments, Guarantees and Contingencies The Company leases property and equipment under operating leases. For leases with durations longer than 12 months, the Company recorded the related operating lease right-of-use asset and operating lease liability at the present value of lease payments over the term. The Company used its incremental borrowing rate to discount the lease payments based on information available at lease commencement. Aircraft As of June 30, 2026, excluding aircraft financed by the Companys major airline partners that the Company operates for them under contract, the Company leased eight aircraft under long-term lease agreements with remaining terms ranging from three to four years. The Company is subleasing these eight aircraft to a third party. Airport facilities The Company has operating leases for facility space including airport terminals, office space, cargo warehouses and maintenance facilities. The Company generally leases this space from government agencies that control the use of the various airports. The remaining lease terms for facility space vary from one month to 30 years. The Companys operating leases with lease rates that are variable based on airport operating costs, use of the facilities or other variable factors are excluded from the Companys right-of-use assets and operating lease liabilities in accordance with accounting guidance. Leases As of June 30, 2026, the Companys right-of-use assets were $87.0 million, the Companys …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

(8) Fair Value Measurements The Company holds certain assets that are required to be measured at fair value in accordance with GAAP. The Company determined the fair value of these assets based on the following three levels of inputs: Level 1 Quoted prices in active markets for identical assets or liabilities. Level 2 Observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Some of the Companys marketable securities primarily utilize broker quotes in a non-active market for valuation of these securities. Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities, therefore requiring an entity to develop its own assumptions. As of June 30, 2026, and December 31, 2025, the Company held certain assets that are required to be measured at fair value on a recurring basis. Assets measured at fair value on a recurring basis are summarized below (in thousands): Fair Value Measurements as of June 30, 2026 Total Level 1 Level 2 Level 3 Marketable Securities Bonds and bond funds $ 492,393 $ $ 492,393 $ Commercial paper 27,179 27,179 519,572 519,572 Investments in Other Companies 2,675 2,675 Cash and Cash Equivalents 81,407 81,407 Total Assets Measured at Fair Value …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

(11) Income Taxes The Companys effective tax rate for the six months ended June 30, 2026 and 2025 was 17.9% and 22.2%, respectively. The Companys effective tax rate for the six months ended June 30, 2026 and 2025 varied from the federal statutory rate of 21.0% primarily due to the impact of a discrete tax benefit from additional tax deductions generated from employee equity awards that vested at a stock price above the grant date price during the six months ended June 30, 2026 and 2025, offset by the provision for state income taxes and the impact of non-deductible expenses. …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

(12) Legal Matters The Company is subject to certain legal actions which it considers routine to its business activities. As of June 30, 2026, the Companys management believed, after consultation with legal counsel, that the ultimate outcome of such legal matters was not likely to have a material adverse effect on the Companys financial position, liquidity or results of operations. …

LegalMattersAndContingenciesTextBlock · excerpt; the full note is in the filing

(9) Long-term Debt Long-term debt consisted of the following as of June 30, 2026, and December 31, 2025 (in thousands): June 30, 2026 December 31, 2025 Current portion of long-term debt $ 656,712 $ 550,028 Current portion of unamortized debt issue cost, net (3,017) (3,216) Current portion of long-term debt, net of debt issue costs $ 653,695 $ 546,812 Long-term debt, net of current maturities $ 1,654,245 $ 1,858,341 Long-term portion of unamortized debt issue cost, net (11,482) (13,069) Long-term debt, net of current maturities and debt issue costs $ 1,642,763 $ 1,845,272 Total long-term debt (including current portion) $ 2,310,957 $ 2,408,369 Total unamortized debt issue cost, net (14,499) (16,285) Total long-term debt, net of debt issue costs $ 2,296,458 $ 2,392,084 As of June 30, 2026, the Company had $2.3 billion of total long-term debt, which consisted of $2.1 billion of debt used to finance aircraft and spare engines and $200.6 million of unsecured debt payable to the U.S. Department of the Treasury (Treasury). As of June 30, 2026, the unsecured debt payable to Treasury had a variable interest rate of Secured Overnight Financing Rate ( SOFR ) plus 2.0% . The average effective interest rate on the Companys debt was approximately 4.4% at June 30, 2026. During the six months ended June 30, 2026, the Company took delivery of two new E175 aircraft that the Company financed through $47.7 million of long-term debt. The debt associated with the E175 aircraft has a 12-year term, …

LongTermDebtTextBlock · excerpt; the full note is in the filing

Recent Accounting Pronouncements In March 2024, the Financial Accounting Standards Board issued Accounting Standards Update No. 2024-03, Income Statement Reporting Comprehensive Income Expense Disaggregation Disclosures (Accounting Standards Codification (ASC) Subtopic 220-40) Disaggregation of Income Statement Expenses, which enhances the transparency and comparability of financial statements by requiring companies to disclose more granular information about expense components. The guidance is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the potential impact of adopting this new guidance on its consolidated financial statements and related disclosures. …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

(2) Operating Revenues The Company recognizes revenue under its flying agreements and under its lease, airport services and other service agreements when the service is provided under the applicable agreement. Under the Companys fixed-fee agreements (referred to as capacity purchase agreements) with United Airlines, Inc. (United), Delta Air Lines, Inc. (Delta), American Airlines, Inc. (American) and Alaska Airlines, Inc. (Alaska) (each, a major airline partner), the major airline partner generally pays the Company a fixed-fee for each departure, flight hour (measured from takeoff to landing, excluding taxi time) or block hour (measured from takeoff to landing, including taxi time) incurred, and an amount per aircraft in service each month, with additional incentives based on flight completion, on-time performance or other performance metrics. The major airline partner also directly pays for or reimburses the Company for certain direct expenses incurred under the capacity purchase agreement, such as fuel, airport landing fees and airport rents. Under the capacity purchase agreements, the Companys performance obligation is met when each flight is completed, measured in completed block hours, and is reflected in flying agreements revenue. The transaction price for the capacity purchase agreements is determined from the fixed-fee consideration, incentive consideration and directly reimbursed expenses earned as flights are completed over the agreement term. For the six months ende …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

(6) Segment Reporting GAAP requires disclosures related to components of a company for which separate financial information is available to, and regularly evaluated by, the Companys chief operating decision maker when deciding how to allocate resources and in assessing performance. The Companys two reportable segments consist of (1) the operations of SkyWest Airlines and SWC (collectively, SkyWest Airlines and SWC) and (2) SkyWest Leasing activities. The Companys chief operating decision maker analyzes the profitability of aircraft separately from the profitability of the Companys capital deployed for new aircraft and the related aircraft financings, including the Companys E175 fleet. The SkyWest Airlines and SWC segment includes revenue earned under the applicable capacity purchase agreements attributed to operating such aircraft and the respective operating costs, and revenue and operating expenses attributed to prorate agreements and airport services agreements. The SkyWest Leasing segment includes applicable revenue earned under the applicable capacity purchase agreements attributed to the ownership of new aircraft acquired through the issuance of debt and the respective depreciation and interest expense of such aircraft. The SkyWest Leasing segment also includes the activity of leasing regional jet aircraft and spare engines to third parties and other activities. The SkyWest Leasing segments total assets and capital expenditures include new aircraft acquired through the …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing