Robert Isom: Hey, thanks for the question Catie. We do have it’s largely timing and operational performance with higher ASMs is what benefited us in the third quarter. In our prior guidance, we didn’t have anything in the third quarter for our open labor agreements outside of the pilots. We did have something in the fourth quarter and we still have something modest in the fourth quarter just given the time it would take to reach and ratify an agreement. But generally speaking, everything this year has come in very much in line with what our initial guidance was, which is why for the full-year, we’re still right around that 3% number. We’ve seen a little bit of pressure on certain line items. We’ve gotten some benefits from others, but overall it’s largely in line with our expectations.
And like just generally speaking, we are pretty good at forecasting out expenses. And I think during the COVID years, that became a little bit more challenging. But in 2023, we feel pretty good about our ability to forecast and deliver results.
Catherine O’Brien: That’s great. Thanks for the detail. And then maybe one for Vasu. You know between the third quarter and second quarter you experienced decel in TRASM, you know, on year-over-year in 2019. I totally understand there’s so many moving pieces now as the network recovers and the shape of your network has changed a bit over the years. But your fourth quarter guidance implies things will stabilize in a year-over-year basis. Can you just walk us through what’s driving that stabilization? Thanks so much.
Robert Isom: And for my clarity, you mean the quarter-to-quarter stabilization?
Catherine O’Brien: Right, just comparing the year-over-year to each other.
Robert Isom: Sure. I will do my best. There’s a few things that are changing in our system right now between one quarter to the next that has that effect. In Q3, what we find just in terms of how we brought the network back, a lot of what we were flying were off time periods, like off peak flights. As we get into Q4, that starts to stabilize a little bit more. We regain a lot more regional supportability into the fourth quarter. And so a little bit of what you see there are just shifting year-over-year trends based on how we brought the airline back and then where the airline is oriented around flying. In the third quarter, especially in the trough seasons of August and September, there are some strange year-over-year comps where the Northeast was performing better than markets in the Sunbelt, when we get into Q4, that’s when the Sunbelt and short haul MCLA starts to change.
And you see that in our schedules. We have, I think, our biggest Miami operation in our history there. So a lot of what you see there is less a function of something fundamental, but some really unique quarter-to-quarter recovery trends.
Catherine O’Brien: Great. Thanks for the time.
Operator: Thank you. Our next question comes from the line of Jamie Baker of JPMorgan.
Jamie Baker: Hey, good morning, everybody. Vasu in NEA question, you know, we’re obviously tracking some of the rebalancing between JFK and Philadelphia. I see that 787 captains in Philly, that number is moving up quite a bit. Looks like JetBlue will continue to operate a portion of your slots through the end of IATA’s summer season next year. I [Technical Difficulty] so part of my question is am I right on that, but more importantly I recognize networks are fluid, but when should we think about Philadelphia and New York, sort of, reaching a steady state? Is that a process that will wrap in time for next summer or should we think of the NEA unwind as lasting longer than that?
Vasu Raja: Hey Jamie, Thanks for the question. I guess, we’ve all been around this business for a while and steady state is always a very difficult thing to prognosticate. But I will say this, the role of these hubs is quite complimentary. And we’re seeing it more and more per my comments earlier, where New York is a lot of New York originating customers when it goes international. Domestic, it’s a mix of New York originating, and as we call it, Spoke City, like outside of hubs originating into New York. And Philadelphia is our largest connecting complex into transatlantic. And so a lot of what you see is just, it comes back to what Robert mentioned. We’re seeing actually a lot of traction in international and transatlantic, better than we have before.
We’re seeing it from both of these markets. For the first time since our Atlantic joint venture was created, we’re pretty consistently the unit revenue leader amongst the group, which has been very unique and a long time coming. And so we think that these two hubs are very complimentary. We see it every day that they’re very complimentary as we bring in the XLR that enables us to do some really unique things in both of those markets. And as we do things like improve the configuration on the 777 300 or bring in more 787 9s, that further augments that. So that’s what you see and look in the world of network planning, we can move things around based on where the demand is. We’ll continue to do it. There will be some of that rebalancing. And certainly as we go into next year, we do see a lot of opportunity to bulk up in Philadelphia as we get more supportability back, as the regional comes back, as we take wide body deliveries.
Jamie Baker: Okay, fair enough. And then second question, you know, for Devon, a clarification, the $3.5 billion CapEx figures that you gave or figure that you gave before, that was aircraft only, correct? So all in, we should be dialing in something, you know, closer to $4.5 billion going forward. I’m assuming I got that right. And if so, do you expect to generate cash next year at current fuel prices?
Devon May: Yes, so there’s two separate things. So for 2024, our total CapEx is between $3 billion and $3.3 billion. Long-term beyond 2024, you’re right that the $3.5 billion number I gave was just aircraft CapEx. So for ‘24, I think our capital requirements are such that we certainly have the ability to generate free cash flow. And we’re absolutely in a different position than some of our peers, just given where they are at in terms of fleet renewal program versus where we’re at. We spent over $30 billion from 2014 to 2019 on our fleet renewal. Now we’re in a nice spot where capital requirements are slightly less and it does give us the ability to produce free cash flow going forward like we did in this year.
Jamie Baker: Okay, thank you very much.
Operator: Thank you. Please stand by for our next question. Our next question comes from the line of Duane Pfennigwerth of Evercore ISI.
