Q2 2026 Surf Air Mobility Inc Earnings Call Transcript
Key Points
- Revenue for Q2 2026 came in at the high end of guidance at $29.5 million, up 8% year-over-year and 15% sequentially.
- Secured first multi-year SurfOS enterprise contract with Wheels Up, valued up to $12 million, validating the product and market readiness.
- Surf On Demand private charter revenue nearly doubled in the first half of 2026, with Q2 revenue of $12.1 million and departures up 67% year-over-year.
- Reduced existing convertible note principal by 64% and lowered monthly cash amortization payments by up to 50%, strengthening the balance sheet.
- Expanded partnership with Palantir, adding engineering and go-to-market resources to accelerate SurfOS commercialization and enterprise sales.
- Deployed safety management system a year ahead of FAA schedule, enhancing operational reliability and compliance.
- Improved full-year 2026 adjusted EBITDA loss guidance by 40% while maintaining revenue growth target of 20-30%.
- Mokulele Airlines revenue grew 7% year-over-year and 15% sequentially, with over 10,000 departures in Q2.
- Launched BETA Technologies electric aircraft demonstration flights in Hawaii, positioning the company for future electrification.
- SurfOS features like AI charter price recommendations and crew reserve optimization went live, driving operational savings and product enhancements.
- Consolidated adjusted EBITDA loss was $10.5 million in Q2, still negative and within guidance range.
- Scheduled service revenue declined 20% year-over-year due to deliberate route exits, impacting top-line growth.
- Fuel prices were elevated and unexpected weather in Hawaii caused unplanned cancellations, pressuring margins.
- Legacy commitments in Surf On Demand continue to drag gross margins, though decreasing quarterly.
- Company is not yet profitable and faces ongoing cash burn, with free cash flow conversion expected to improve only sequentially.
- NYSE listing compliance at risk due to minimum share price deficiency, with potential reverse stock split as a mitigant.
- Dependence on Palantir partnership for go-to-market resources may create execution risk if partnership dynamics change.
- SurfOS enterprise pipeline conversion is uncertain, with only one contract signed and target of at least one more by year-end.
- High maintenance and CapEx cycle has pressured cash flow, though expected to ease in second half.
- Revenue guidance for Q3 implies a significant sequential jump, which may be challenging to achieve given macro headwinds.
Good evening. My name is Dara and I'll be your conference operator today for the Surf Air Mobility second-quarter 2026 earnings call. (Operator Instructions)
I will now pass the call over to Hudson Andrews for opening remarks. Go ahead.
Thank you, operator, and good afternoon, everyone. Welcome to Surf Air Mobility's second quarter 2026 earnings call. I am joined today by Deanna White, our Chief Executive Officer. Shawn Pelsinger, our newly appointed Chairman of the Board; Liam Fayed, our Co-Founder; Louis Saint-Cyr, our President of Airline Operations; Joshua Lowton, our President of Surf On Demand; and Oliver Reeves, our Chief Financial Officer.
Our earnings release can be found on the SEC, EDGAR website, and on our Investor Relations page at investors.surfair.com.
Before we begin, I want to remind everyone that during today's call, we will discuss our outlook and expectations for future performance.
These forward-looking statements may be preceded by
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