{"url_path":"/sec/ual/10-k/2026/item-8","section_key":"item-8","section_title":"Item 8 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.","topic":"sec","document":{"doc_type":"10-K","doc_date":"2026-02-12","source_url":"https://www.sec.gov/Archives/edgar/data/100517/0000100517-26-000023-index.html","accession_number":"0000100517-26-000023","cik":"0000100517","ticker":"UAL","issuer_name":"United Airlines Holdings, Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/100517/0000100517-26-000023-index.html","primary_entity_key":"0000100517","primary_entity_name":"United Airlines Holdings, Inc."},"word_count":18971,"has_tables":true,"body_markdown":"ITEM 8.    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.\n\nINDEX TO CONSOLIDATED FINANCIAL STATEMENTS\n\n Page\n\n[Report of Independent Registered Public Accounting Firm (PCAOB ID:](#i58162399576e4fb8b3894b993dca610a_70) 42)\n\n[52](#i58162399576e4fb8b3894b993dca610a_70)\n\n[United Airlines Holdings, Inc.:](#i58162399576e4fb8b3894b993dca610a_76)\n\n[Statements of Consolidated Operations](#i58162399576e4fb8b3894b993dca610a_79)\n\n[56](#i58162399576e4fb8b3894b993dca610a_79)\n\n[Statements of Consolidated Comprehensive Income (Loss)](#i58162399576e4fb8b3894b993dca610a_82)\n\n[57](#i58162399576e4fb8b3894b993dca610a_82)\n\n[Consolidated Balance Sheets](#i58162399576e4fb8b3894b993dca610a_85)\n\n[58](#i58162399576e4fb8b3894b993dca610a_85)\n\n[Statements of Consolidated Cash Flows](#i58162399576e4fb8b3894b993dca610a_91)\n\n[59](#i58162399576e4fb8b3894b993dca610a_91)\n\n[Statement of Consolidated Stockholders' Equity](#i58162399576e4fb8b3894b993dca610a_94)\n\n[60](#i58162399576e4fb8b3894b993dca610a_94)\n\n[United Airlines, Inc.:](#i58162399576e4fb8b3894b993dca610a_97)\n\n[Statements of Consolidated Operations](#i58162399576e4fb8b3894b993dca610a_100)\n\n[61](#i58162399576e4fb8b3894b993dca610a_100)\n\n[Statements of Consolidated Comprehensive Income (Loss)](#i58162399576e4fb8b3894b993dca610a_103)\n\n[62](#i58162399576e4fb8b3894b993dca610a_103)\n\n[Consolidated Balance Sheets](#i58162399576e4fb8b3894b993dca610a_106)\n\n[63](#i58162399576e4fb8b3894b993dca610a_106)\n\n[Statements of Consolidated Cash Flows](#i58162399576e4fb8b3894b993dca610a_112)\n\n[64](#i58162399576e4fb8b3894b993dca610a_112)\n\n[Statement of Consolidated Stockholder's Equity](#i58162399576e4fb8b3894b993dca610a_115)\n\n[65](#i58162399576e4fb8b3894b993dca610a_115)\n\n[Combined Notes to Consolidated Financial Statements](#i58162399576e4fb8b3894b993dca610a_118)\n\n[66](#i58162399576e4fb8b3894b993dca610a_118)\n\n[Note 1 - Basis of Presentation and Significant Accounting Policies](#i58162399576e4fb8b3894b993dca610a_121)\n\n[66](#i58162399576e4fb8b3894b993dca610a_121)\n\n[Note 2 - Revenue Recognition](#i58162399576e4fb8b3894b993dca610a_127)\n\n[70](#i58162399576e4fb8b3894b993dca610a_127)\n\n[Note 3 - Common Stockholders' Equity and Preferred Securities](#i58162399576e4fb8b3894b993dca610a_130)\n\n[73](#i58162399576e4fb8b3894b993dca610a_130)\n\n[Note 4 - Earnings Per Share](#i58162399576e4fb8b3894b993dca610a_133)\n\n[74](#i58162399576e4fb8b3894b993dca610a_133)\n\n[Note 5 - Share-Based Compensation Plans](#i58162399576e4fb8b3894b993dca610a_136)\n\n[74](#i58162399576e4fb8b3894b993dca610a_136)\n\n[Note 6 - Accumulated Other Comprehensive Income (Loss) (\"AOCI\")](#i58162399576e4fb8b3894b993dca610a_142)\n\n[76](#i58162399576e4fb8b3894b993dca610a_142)\n\n[Note 7 - Income Taxes](#i58162399576e4fb8b3894b993dca610a_145)\n\n[76](#i58162399576e4fb8b3894b993dca610a_145)\n\n[Note 8 - Pension, Postretirement and Other Employee Benefit Plans](#i58162399576e4fb8b3894b993dca610a_148)\n\n[78](#i58162399576e4fb8b3894b993dca610a_148)\n\n[Note 9 - Fair Value Measurements, Investments and Notes Receivable](#i58162399576e4fb8b3894b993dca610a_151)\n\n[84](#i58162399576e4fb8b3894b993dca610a_151)\n\n[Note 10 - Debt](#i58162399576e4fb8b3894b993dca610a_154)\n\n[86](#i58162399576e4fb8b3894b993dca610a_154)\n\n[Note 11 - Leases](#i58162399576e4fb8b3894b993dca610a_157)\n\n[87](#i58162399576e4fb8b3894b993dca610a_157)\n\n[Note 12 - Commitments, Contingencies and Guarantees](#i58162399576e4fb8b3894b993dca610a_160)\n\n[90](#i58162399576e4fb8b3894b993dca610a_160)\n\n[Note 13 - Special Charges (Credits)](#i58162399576e4fb8b3894b993dca610a_166)\n\n[92](#i58162399576e4fb8b3894b993dca610a_166)\n\n51\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nReport of Independent Registered Public Accounting Firm\n\nTo the Stockholders and the Board of Directors of United Airlines Holdings, Inc.\n\nOpinion on the Financial Statements\n\nWe have audited the accompanying consolidated balance sheets of United Airlines Holdings, Inc. (the \"Company\") as of December 31, 2025 and 2024, the related statements of consolidated operations, comprehensive income (loss), stockholders' equity and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the \"consolidated financial statements\"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.\n\nWe also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (\"PCAOB\"), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 12, 2026, expressed an unqualified opinion thereon.\n\nBasis for Opinion\n\nThese financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\nWe conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.\n\nCritical Audit Matter\n\nThe critical audit matter communicated below is a matter arising from the current period audit of the financial statements that is communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.\n\n52\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nIndefinite-lived Intangible Asset (China Route Authority) Impairment Analysis\n\nDescription of the Matter\n\nAs discussed in Note 1 of the consolidated financial statements, indefinite-lived assets are reviewed for impairment on an annual basis as of October 1, or more frequently if events or circumstances indicate that the asset may be impaired. For the Company's China route authority, the Company performed a quantitative assessment which involved determining the fair value of the asset and comparing that amount to the asset’s carrying value. At December 31, 2025, the carrying value of the Company's China route authority indefinite-lived intangible asset (the China intangible asset) was $1.0 billion.\n\nAuditing management's annual China intangible asset impairment test was complex and highly judgmental due to the significant estimation required in determining the fair value of the asset. The fair value estimate was sensitive to significant assumptions such as forecasted revenues, margin and an overall discount rate, each of which is affected by expectations about future market or economic conditions. As a result of the subjectivity of the assumptions, adverse changes to management's estimates could reduce the underlying cash flows used to estimate fair value and trigger impairment charges.\n\nWe Addressed the Matter in Our Audit\n\nWe tested the Company's design and operating effectiveness of internal controls that address the risk of material misstatement relating to the estimate of fair value of the China intangible asset used in the annual impairment test. This included testing controls over management's review of the significant assumptions used in the discounted cash flow methodology, including forecasted revenues, margin and the overall discount rate.\n\nTo test the estimated fair value of the Company's China intangible asset, we performed audit procedures that included, among others, assessing the fair value methodology used by management and evaluating the significant assumptions used in the valuation model. We compared significant assumptions to current industry, market and economic trends, and to the Company's historical results. We assessed the historical accuracy of management's estimates and performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the China intangible asset that would result from changes in assumptions. We also involved a valuation specialist to assist in our evaluation of the Company's overall discount rate.\n\n/s/ Ernst & Young LLP\n\nWe have served as the Company's auditor since 2009.\n\nChicago, Illinois\n\nFebruary 12, 2026\n\n53\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\n    \n\nReport of Independent Registered Public Accounting Firm\n\n    \n\nTo the Stockholder and the Board of Directors of United Airlines, Inc.\n\nOpinion on the Financial Statements\n\nWe have audited the accompanying consolidated balance sheets of United Airlines, Inc. (the \"Company\") as of December 31, 2025 and 2024, the related statements of consolidated operations, comprehensive income (loss), stockholder's equity and cash flows, for each of the three years in the period ended December 31, 2025, and the related notes (collectively referred to as the \"consolidated financial statements\"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.\n\nBasis for Opinion\n\nThese financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (\"PCAOB\") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\nWe conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.\n\nOur audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.\n\nCritical Audit Matter\n\nThe critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.\n\n54\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nIndefinite-lived Intangible Asset (China Route Authority) Impairment Analysis\n\nDescription of the Matter\nAs discussed in Note 1 of the consolidated financial statements, indefinite-lived assets are reviewed for impairment on an annual basis as of October 1, or more frequently if events or circumstances indicate that the asset may be impaired. For the Company's China route authority, the Company performed a quantitative assessment which involved determining the fair value of the asset and comparing that amount to the asset's carrying value. At December 31, 2025, the carrying value of the Company's China route authority indefinite-lived intangible asset (the China intangible asset) was $1.0 billion.\n\nAuditing management's annual China intangible asset impairment test was complex and highly judgmental due to the significant estimation required in determining the fair value of the asset. The fair value estimate was sensitive to significant assumptions such as forecasted revenues, margin and an overall discount rate, each of which is affected by expectations about future market or economic conditions. As a result of the subjectivity of the assumptions, adverse changes to management's estimates could reduce the underlying cash flows used to estimate fair value and trigger impairment charges.\n\nWe Addressed the Matter in Our Audit\nWe tested the Company's design and operating effectiveness of internal controls that address the risk of material misstatement relating to the estimate of fair value of the China intangible asset used in the annual impairment test. This included testing controls over management's review of the significant assumptions used in the discounted cash flow methodology, including forecasted revenues, margin and the overall discount rate.\n\nTo test the estimated fair value of the Company's China intangible asset, we performed audit procedures that included, among others, assessing the fair value methodology used by management and evaluating the significant assumptions used in the valuation model. We compared significant assumptions to current industry, market and economic trends, and to the Company's historical results. We assessed the historical accuracy of management's estimates and performed sensitivity analyses of significant assumptions to evaluate the changes in the fair value of the China intangible asset that would result from changes in assumptions. We also involved a valuation specialist to assist in our evaluation of the Company's overall discount rate.\n\n/s/ Ernst & Young LLP\n\nWe have served as the Company's auditor since 2009.\n\nChicago, Illinois\n\nFebruary 12, 2026\n\n55\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES HOLDINGS, INC.\n\nSTATEMENTS OF CONSOLIDATED OPERATIONS\n\n(In millions, except per share amounts)\n\n \n\n Year Ended December 31,\n\n 202520242023\n\nOperating revenue:\n\nPassenger revenue$53,438 $51,829 $49,046 \n\nCargo revenue1,779 1,743 1,495 \n\nOther operating revenue3,853 3,491 3,176 \n\nTotal operating revenue59,070 57,063 53,717 \n\nOperating expense:\n\nSalaries and related costs17,647 16,678 14,787 \n\nAircraft fuel11,396 11,756 12,651 \n\nLanding fees and other rent3,849 3,437 3,076 \n\nAircraft maintenance materials and outside repairs3,294 3,063 2,736 \n\nDepreciation and amortization2,939 2,928 2,671 \n\nRegional capacity purchase2,693 2,516 2,400 \n\nDistribution expenses2,109 2,231 1,977 \n\nAircraft rent252 193 197 \n\nSpecial charges259 112 949 \n\nOther operating expenses9,919 9,053 8,062 \n\nTotal operating expense54,356 51,967 49,506 \n\nOperating income4,713 5,096 4,211 \n\nNonoperating income (expense):\n\nInterest expense(1,373)(1,629)(1,956)\n\nInterest income611 726 827 \n\nInterest capitalized206 227 182 \n\nUnrealized gains (losses) on investments, net4 (199)27 \n\nMiscellaneous, net144 (53)96 \n\nTotal nonoperating expense, net(408)(928)(824)\n\nIncome before income taxes4,306 4,168 3,387 \n\nIncome tax expense953 1,019 769 \n\nNet income$3,353 $3,149 $2,618 \n\nEarnings per share, basic$10.32 $9.58 $7.98 \n\nEarnings per share, diluted$10.20 $9.45 $7.89 \n\nThe accompanying Combined Notes to Consolidated Financial Statements are an integral part of these statements.\n\n56\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES HOLDINGS, INC.\n\nSTATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME (LOSS)\n\n(In millions)\n\n Year Ended December 31,\n\n 202520242023\n\nNet income$3,353 $3,149 $2,618 \n\nOther comprehensive income (loss), net of tax:\n\nEmployee benefit plans(148)247 (261)\n\nInvestments and other8 3 24 \n\nTotal other comprehensive income (loss), net of tax(140)250 (237)\n\nTotal comprehensive income, net$3,214 $3,399 $2,381 \n\nThe accompanying Combined Notes to Consolidated Financial Statements are an integral part of these statements.\n\n57\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES HOLDINGS, INC.\n\nCONSOLIDATED BALANCE SHEETS\n\n(In millions, except shares)\n\nAt December 31,\n\nASSETS20252024\n\nCash and cash equivalents$5,942 $8,769 \n\nShort-term investments6,298 5,706 \n\nReceivables, net2,391 2,163 \n\nAircraft fuel, spare parts and supplies, net1,556 1,572 \n\nPrepaid expenses and other671 673 \n\nTotal current assets16,857 18,883 \n\nOperating property and equipment, net46,121 42,908 \n\nOperating lease right-of-use assets4,958 3,815 \n\nGoodwill4,527 4,527 \n\nIntangible assets, net2,655 2,683 \n\nInvestments in affiliates and other, net1,330 1,267 \n\nTotal noncurrent assets59,591 55,200 \n\nTotal assets$76,448 $74,083 \n\nLIABILITIES AND STOCKHOLDERS' EQUITY\n\nAccounts payable$4,567 $4,193 \n\nAccrued salaries and benefits3,900 3,289 \n\nAdvance ticket sales8,131 7,561 \n\nFrequent flyer deferred revenue3,721 3,403 \n\nCurrent maturities of long-term debt, finance leases, and other financial liabilities4,426 3,453 \n\nCurrent maturities of operating leases631 467 \n\nOther757 948 \n\nTotal current liabilities26,133 23,314 \n\nLong-term debt, finance leases, and other financial liabilities20,562 25,203 \n\nLong-term obligations under operating leases5,417 4,510 \n\nFrequent flyer deferred revenue4,056 4,038 \n\nPension and postretirement benefit liability1,058 1,233 \n\nDeferred income taxes2,463 1,580 \n\nOther1,478 1,530 \n\nTotal noncurrent liabilities35,033 38,094 \n\nCommitments and Contingencies\n\nStockholders' equity:\n\nPreferred stock— — \n\nCommon stock at par, $0.01 par value; authorized 1,000,000,000 shares; outstanding 323,470,682 and 327,899,771 shares at December 31, 2025 and 2024, respectively\n4 4 \n\nAdditional capital invested8,911 8,980 \n\nStock held in treasury, at cost(3,773)(3,377)\n\nRetained earnings10,092 6,880 \n\nAccumulated other comprehensive income48 188 \n\nTotal stockholders' equity15,282 12,675 \n\nTotal liabilities and stockholders' equity$76,448 $74,083 \n\nThe accompanying Combined Notes to Consolidated Financial Statements are an integral part of these statements.\n\n58\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES HOLDINGS, INC.\n\nSTATEMENTS OF CONSOLIDATED CASH FLOWS\n\n(In millions)\n\n Year Ended December 31,\n\n 202520242023\n\nOperating Activities:\n\nNet income$3,353 $3,149 $2,618 \n\nAdjustments to reconcile net income to net cash provided by (used in) operating activities -\n\nDeferred income tax925 935 756 \n\nDepreciation and amortization2,939 2,928 2,671 \n\nOperating and non-operating special charges, non-cash portion13 158 84 \n\nUnrealized (gains) losses on investments(4)199 (27)\n\nAmortization of debt discount and debt issuance costs77 166 139 \n\nOther operating activities(62)9 6 \n\nChanges in operating assets and liabilities -\n\n(Increase) decrease in receivables(297)280 (100)\n\nIncrease in prepaids and other assets(264)(166)(463)\n\nIncrease (decrease) in advance ticket sales570 857 (851)\n\nIncrease in frequent flyer deferred revenue336 298 468 \n\nIncrease in accounts payable674 178 572 \n\nIncrease in other liabilities171 454 1,038 \n\nNet cash provided by operating activities8,431 9,445 6,911 \n\nInvesting Activities:\n\nCapital expenditures, net of flight equipment purchase deposit returns(5,874)(5,615)(7,171)\n\nPurchases of short-term and other investments(7,763)(5,809)(9,470)\n\nProceeds from sale of short-term and other investments7,284 8,661 10,519 \n\nProceeds from sale of property and equipment98 109 39 \n\nOther, net(96)3 (23)\n\nNet cash used in investing activities(6,350)(2,651)(6,106)\n\nFinancing Activities:\n\nProceeds from issuance of debt and other financial liabilities, net of discounts and fees578 6,139 2,388 \n\nPayments of long-term debt, finance leases and other financial liabilities(4,771)(10,138)(4,248)\n\nRepurchases of common stock(637)(162)— \n\nOther, net(115)(21)(32)\n\nNet cash used in financing activities(4,945)(4,182)(1,892)\n\nNet increase (decrease) in cash, cash equivalents and restricted cash(2,865)2,612 (1,087)\n\nCash, cash equivalents and restricted cash at beginning of year8,946 6,334 7,421 \n\nCash, cash equivalents and restricted cash at end of year$6,081 $8,946 $6,334 \n\nInvesting and Financing Activities Not Affecting Cash:\n\nRight-of-use assets acquired or modified through operating leases$1,901 $625 $761 \n\nProperty and equipment acquired through the issuance or modification of debt, finance leases and other financial liabilities(25)409 819 \n\nOperating leases converted to finance leases417 239 295 \n\nInvestment interests received in exchange for loans, goods and services45 24 33 \n\nCash Paid During the Period for:\n\nInterest$1,330 $1,494 $1,848 \n\nIncome taxes62 88 7 \n\nThe accompanying Combined Notes to Consolidated Financial Statements are an integral part of these statements.\n\n59\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES HOLDINGS, INC.\n\nSTATEMENTS OF CONSOLIDATED STOCKHOLDERS' EQUITY\n\n(In millions)\n\n \n\n Common\nStockAdditional\nCapital InvestedTreasury StockRetained EarningsAccumulated\nOther Comprehensive Income (Loss)Total\n\nSharesAmount\n\nBalance at December 31, 2022326.9 $4 $8,986 $(3,534)$1,265 $175 $6,896 \n\nNet income— — — — 2,618 — 2,618 \n\nOther comprehensive loss— — — — — (237)(237)\n\nStock-settled share-based compensation— — 77 — — — 77 \n\nProceeds from exercise of stock options— — 1 — — — 1 \n\nStock issued for share-based awards, net of shares withheld for tax1.1 — (72)93 (52)— (31)\n\nBalance at December 31, 2023328 4 8,992 (3,441)3,831 (62)9,324 \n\nNet income— — — — 3,149 — 3,149 \n\nOther comprehensive income— — — — — 250 250 \n\nStock-settled share-based compensation— — 135 — — — 135 \n\nRepurchase of common stock(3.0)— — (162)— — (162)\n\nShare issued for settlement of Warrants2.0 — (96)150 (54)— — \n\nStock issued for share-based awards, net of shares withheld for tax0.9 — (51)76 (46)— (21)\n\nBalance at December 31, 2024327.9 4 8,980 (3,377)6,880 188 12,675 \n\nNet income— — — — 3,353 — 3,353 \n\nOther comprehensive loss— — — — — (140)(140)\n\nStock-settled share-based compensation— — 142 — — — 142 \n\nRepurchases of common stock(8.1)— — (641)— — (641)\n\nStock issued for settlement of Warrants1.8 — (99)133 (34)— — \n\nStock issued for share-based awards, net of shares withheld for tax1.9 — (112)111 (107)— (108)\n\nBalance at December 31, 2025323.5 $4 $8,911 $(3,773)$10,092 $48 $15,282 \n\nThe accompanying Combined Notes to Consolidated Financial Statements are an integral part of these statements.\n\n60\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES, INC.\n\nSTATEMENTS OF CONSOLIDATED OPERATIONS\n\n(In millions)\n\n \n\nYear Ended December 31,\n\n 202520242023\n\nOperating revenue:\n\nPassenger revenue$53,438 $51,829 $49,046 \n\nCargo revenue1,779 1,743 1,495 \n\nOther operating revenue3,853 3,491 3,176 \n\nTotal operating revenue59,070 57,063 53,717 \n\nOperating expense:\n\nSalaries and related costs17,647 16,678 14,787 \n\nAircraft fuel11,396 11,756 12,651 \n\nLanding fees and other rent3,849 3,437 3,076 \n\nAircraft maintenance materials and outside repairs3,294 3,063 2,736 \n\nDepreciation and amortization2,939 2,928 2,671 \n\nRegional capacity purchase2,693 2,516 2,400 \n\nDistribution expenses2,109 2,231 1,977 \n\nAircraft rent252 193 197 \n\nSpecial charges259 112 949 \n\nOther operating expenses9,917 9,050 8,059 \n\nTotal operating expense54,354 51,964 49,503 \n\nOperating income4,716 5,099 4,214 \n\nNonoperating income (expense):\n\nInterest expense(1,373)(1,629)(1,956)\n\nInterest income611 726 827 \n\nInterest capitalized206 227 182 \n\nUnrealized gains (losses) on investments, net4 (199)27 \n\nMiscellaneous, net144 (53)96 \n\nTotal nonoperating expense, net(408)(928)(824)\n\nIncome before income taxes4,308 4,171 3,390 \n\nIncome tax expense953 1,020 770 \n\nNet income$3,355 $3,151 $2,620 \n\nThe accompanying Combined Notes to Consolidated Financial Statements are an integral part of these statements.\n\n61\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES, INC.\n\nSTATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME (LOSS)\n\n(In millions)\n\n Year Ended December 31,\n\n 202520242023\n\nNet income$3,355 $3,151 $2,620 \n\nOther comprehensive income (loss), net of tax:\n\nEmployee benefit plans(148)247 (261)\n\nInvestments and other8 3 24 \n\nTotal other comprehensive income (loss), net of tax(140)250 (237)\n\nTotal comprehensive income, net$3,215 $3,401 $2,383 \n\nThe accompanying Combined Notes to Consolidated Financial Statements are an integral part of these statements.\n\n62\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES, INC.\n\nCONSOLIDATED BALANCE SHEETS\n\n(In millions, except shares)\n\nAt December 31,\n\nASSETS20252024\n\nCash and cash equivalents$5,942 $8,769 \n\nShort-term investments6,298 5,706 \n\nReceivables, net2,391 2,163 \n\nAircraft fuel, spare parts and supplies, net1,556 1,572 \n\nPrepaid expenses and other671 673 \n\nTotal current assets16,857 18,883 \n\nOperating property and equipment, net46,121 42,908 \n\nOperating lease right-of-use assets4,958 3,815 \n\nGoodwill4,527 4,527 \n\nIntangible assets, net2,655 2,683 \n\nInvestments in affiliates and other, net1,330 1,267 \n\nTotal noncurrent assets59,591 55,200 \n\nTotal assets$76,448 $74,083 \n\nLIABILITIES AND STOCKHOLDER'S EQUITY\n\nAccounts payable$4,567 $4,193 \n\nAccrued salaries and benefits3,900 3,289 \n\nAdvance ticket sales8,131 7,561 \n\nFrequent flyer deferred revenue3,721 3,403 \n\nCurrent maturities of long-term debt, finance leases, and other financial liabilities4,426 3,453 \n\nCurrent maturities of operating leases631 467 \n\nOther754 949 \n\nTotal current liabilities26,130 23,315 \n\nLong-term debt, finance leases, and other financial liabilities20,562 25,203 \n\nLong-term obligations under operating leases5,417 4,510 \n\nFrequent flyer deferred revenue4,056 4,038 \n\nPension and postretirement benefit liability1,058 1,233 \n\nDeferred income taxes2,493 1,610 \n\nOther1,478 1,530 \n\nTotal noncurrent liabilities35,064 38,124 \n\nCommitments and Contingencies\n\nStockholder's equity:\n\nCommon stock at par, $0.01 par value; authorized 1,000 shares; issued and outstanding 1,000 shares at December 31, 2025 and 2024\n— — \n\nAdditional capital invested760 617 \n\nRetained earnings12,842 9,487 \n\nAccumulated other comprehensive income48 188 \n\nPayable to parent1,604 2,352 \n\nTotal stockholder's equity15,254 12,644 \n\nTotal liabilities and stockholder's equity$76,448 $74,083 \n\n \n\nThe accompanying Combined Notes to Consolidated Financial Statements are an integral part of these statements.\n\n63\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES, INC.\n\nSTATEMENTS OF CONSOLIDATED CASH FLOWS\n\n(In millions)\n\nYear Ended December 31,\n\n202520242023\n\nOperating Activities:\n\nNet income$3,355 $3,151 $2,620 \n\nAdjustments to reconcile net income to net cash provided by (used in) operating activities -\n\nDeferred income tax925 937 757 \n\nDepreciation and amortization2,939 2,928 2,671 \n\nOperating and non-operating special charges, non-cash portion13 158 84 \n\nUnrealized (gains) losses on investments(4)199 (27)\n\nAmortization of debt discount and debt issuance costs77 166 139 \n\nOther operating activities(62)9 7 \n\nChanges in operating assets and liabilities -\n\n(Increase) decrease in receivables(297)280 (100)\n\nIncrease in prepaids and other assets(264)(166)(463)\n\nIncrease (decrease) in advance ticket sales570 857 (851)\n\nIncrease in frequent flyer deferred revenue336 298 468 \n\nIncrease in accounts payable674 178 572 \n\nDecrease in intercompany payable(747)(186)(33)\n\nIncrease in other liabilities171 453 1,035 \n\nNet cash provided by operating activities7,685 9,262 6,879 \n\nInvesting Activities:\n\nCapital expenditures, net of flight equipment purchase deposit returns(5,874)(5,615)(7,171)\n\nPurchases of short-term and other investments(7,763)(5,809)(9,470)\n\nProceeds from sale of short-term and other investments7,284 8,661 10,519 \n\nProceeds from sale of property and equipment98 109 39 \n\nOther, net(96)3 (23)\n\nNet cash used in investing activities(6,350)(2,651)(6,106)\n\nFinancing Activities:\n\nProceeds from issuance of debt and other financial liabilities, net of discounts and fees578 6,139 2,388 \n\nPayments of long-term debt, finance leases and other financial liabilities(4,771)(10,138)(4,248)\n\nOther, net(6)— — \n\nNet cash used in financing activities(4,200)(3,999)(1,860)\n\nNet increase (decrease) in cash, cash equivalents and restricted cash(2,865)2,612 (1,087)\n\nCash, cash equivalents and restricted cash at beginning of year8,946 6,334 7,421 \n\nCash, cash equivalents and restricted cash at end of year$6,081 $8,946 $6,334 \n\nInvesting and Financing Activities Not Affecting Cash:\n\nRight-of-use assets acquired or modified through operating leases$1,901 $625 $761 \n\nProperty and equipment acquired through the issuance or modification of debt, finance leases and other financial liabilities(25)409 819 \n\nOperating leases converted to finance leases417 239 295 \n\nInvestment interests received in exchange for loans, goods and services45 24 33 \n\nCash Paid During the Period for:\n\nInterest$1,330 $1,494 $1,848 \n\nIncome taxes62 88 7 \n\nThe accompanying Combined Notes to Consolidated Financial Statements are an integral part of these statements.\n\n64\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES, INC.\n\nSTATEMENTS OF CONSOLIDATED STOCKHOLDER'S EQUITY\n\n(In millions)\n\n \n\n Additional\nCapital\nInvestedRetained EarningsAccumulated\nOther\nComprehensive\nIncome (Loss)(Receivable from) Payable to Related Parties, NetTotal\n\nBalance at December 31, 2022$403 $3,716 $175 $2,571 $6,865 \n\nNet income— 2,620 — — 2,620 \n\nOther comprehensive loss— — (237)— (237)\n\nStock-settled share-based compensation77 — — — 77 \n\nOther2 — — (33)(31)\n\nBalance at December 31, 2023482 6,336 (62)2,538 9,294 \n\nNet income— 3,151 — — 3,151 \n\nOther comprehensive income— — 250 — 250 \n\nStock-settled share-based compensation135 — — — 135 \n\nImpact of UAL share repurchase— — — (162)(162)\n\nOther— — — (24)(24)\n\nBalance at December 31, 2024617 9,487 188 2,352 12,644 \n\nNet income— 3,355 — — 3,355 \n\nOther comprehensive loss— — (140)— (140)\n\nStock-settled share-based compensation142 — — — 142 \n\nImpact of UAL share repurchase— — — (637)(637)\n\nOther— — — (110)(110)\n\nBalance at December 31, 2025$760 $12,842 $48 $1,604 $15,254 \n\nThe accompanying Combined Notes to Consolidated Financial Statements are an integral part of these statements.\n\n65\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUNITED AIRLINES HOLDINGS, INC.\n\nUNITED AIRLINES, INC.\n\nCOMBINED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS\n\nNOTE 1 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES\n\nBasis of Presentation\n\nUnited Airlines Holdings, Inc. (together with its consolidated subsidiaries, \"UAL\" or the \"Company\") is a holding company incorporated in Delaware and its wholly-owned subsidiary is United Airlines, Inc. (together with its consolidated subsidiaries, \"United\"). As UAL consolidates United for financial statement purposes, disclosures that relate to activities of United also apply to UAL, unless otherwise noted. United comprises substantially all of UAL's operating revenues, operating expenses, assets, liabilities and operating cash flows. When appropriate, UAL and United are named specifically for their individual contractual obligations and related disclosures and any significant differences between the operations and results of UAL and United are separately disclosed and explained.\n\nThe Company's consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (\"GAAP\"). The Company consolidates variable interest entities when it determines that it is the primary beneficiary of those entities' operations. All material intercompany accounts and transactions have been eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the current period presentation.\n\nIn 2025, the Company changed its rounding presentation to the nearest whole number in millions of reported amounts, except per share data or as otherwise designated. As such, certain columns and rows within the financial statements and tables presented may not sum due to rounding. Per unit amounts have been calculated from the underlying whole-dollar amounts. This change is not material and does not impact the comparability of our condensed consolidated financial statements.\n\nUse of Estimates\n\nThe preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in these financial statements and accompanying notes. Actual results could differ from those estimates.\n\nSegments\n\nOperating segments are defined as components of an enterprise with separate financial information, which are evaluated regularly by the chief operating decision maker (\"CODM\") and are used to assess performance and allocate resources. The Company manages its operations as one segment. Managing the Company as one segment allows management the opportunity to maximize the value of its route network and maximize the Company's consolidated financial results. The Company deploys its aircraft across its route network through a single route scheduling system to maximize its value. The Company's chief executive officer is its CODM. When making resource allocation decisions for the network, the Company's CODM evaluates flight profitability data, which considers aircraft type and route economics. The CODM assesses performance of the Company and makes resource allocation decisions based on net income as reported in the Company's statement of consolidated operations. Within the statement of consolidated operations, Other expenses represent various purchased services related to the operations of the airline such as ground handling, passenger services, food and beverage offerings, navigation fees, personnel-related costs and information technology projects. The measure of segment assets is reported on the consolidated balance sheet as Total assets.\n\nSignificant Accounting Policies\n\nCash and Cash Equivalents and Restricted Cash. Highly liquid investments with a maturity of three months or less on their acquisition date are classified as cash and cash equivalents. Restricted cash is classified as current or noncurrent in the consolidated balance sheets based on the expected timing of return of the assets to the Company or payment to an outside party. The restricted cash balances primarily include collateral for letters of credit and collateral associated with facility leases and certain insurance-related obligations.\n\nThe following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the statements of consolidated cash flows (in millions):\n\n66\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nAt December 31,\n\n202520242023\n\nCurrent assets:\n\nCash and cash equivalents$5,942 $8,769 $6,058 \n\nRestricted cash in Prepaid expenses and other— 11 31 \n\nNoncurrent assets:\n\nRestricted cash in Investments in affiliates and other, net139 166 245 \n\nTotal cash, cash equivalents and restricted cash$6,081 $8,946 $6,334 \n\nInvestments. Highly liquid investments with maturities of greater than three months, but not beyond one year, at the time of purchase are classified as short-term investments and are stated at fair value. Investments with maturities beyond one year when purchased are classified as short-term investments if they are expected to be available to support the Company's short-term liquidity needs. Short-term investments in debt securities are classified as available-for-sale and are stated at fair value. Realized gains and losses on sales of these investments are reflected in Interest income in the statements of consolidated operations. Unrealized gains and losses on available-for-sale debt securities are reflected as a component of accumulated other comprehensive income (loss). Equity investments are accounted for under the equity method if we are able to exercise significant influence over the investee. Equity investments for which we do not have significant influence are recorded at fair value or at cost, if fair value is not readily determinable, with adjustments for observable changes in price or impairments (referred to as the measurement alternative). Changes in fair value are recorded in Unrealized gains (losses) on investments, net in the statements of consolidated operations. See Note 9 of this report for additional information related to investments.\n\nReceivables. Receivables primarily consist of amounts due from credit card companies, non-airline partners, and cargo customers. We provide an allowance for credit losses expected to be incurred. We base our allowance on various factors including, but not limited to, aging, payment history, write-offs, macro-economic indicators and other credit monitoring indicators. Credit loss expense and write-offs related to receivables were not material for the years ended December 31, 2025, 2024 and 2023.\n\nAircraft Fuel, Spare Parts and Supplies. The Company accounts for aircraft fuel, spare parts and supplies at average cost and provides an obsolescence allowance for aircraft spare parts with an assumed residual value of 10% of original cost. Allowance for obsolescence was $830 million and $739 million at December 31, 2025 and 2024, respectively. Obsolescence expense was $119 million, $175 million, and $102 million for the years ended December 31, 2025, 2024 and 2023, respectively, and is included in Depreciation and amortization expense in the statements of consolidated operations.\n\nProperty and Equipment. The Company records additions to owned operating property and equipment at cost when acquired. Costs related to modifications that enhance the operating performance or extend the useful lives of airframes or engines are capitalized as property and equipment. We periodically receive credits in connection with the acquisition of aircraft and engines as well as contractual damages related to delays in delivery or operating performance issues. These credits are generally deferred and are recognized as a reduction to the cost of the related equipment.\n\nDepreciation and amortization is recognized on a straight-line basis over the assets' estimated useful lives. Leasehold improvements are amortized over the shorter of the remaining term of the lease or the estimated useful life of the related asset. The estimated useful lives of property and equipment are as follows:\n\n Estimated Useful Life (in years)\n\nAircraft, spare engines and related rotable parts\n25 to 30\n\nAircraft seats\n10 to 15\n\nBuildings\n25 to 45\n\nOther property and equipment\n3 to 20\n\nComputer software\n5 to 15\n\nBuilding improvements\n1 to 40\n\nOperating property and equipment, net at December 31 was as follows (in millions):\n\n67\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\n20252024\n\nFlight equipment$56,876 $52,696 \n\nOther property and equipment13,204 11,908 \n\nPurchase deposits for flight equipment3,506 3,427 \n\nTotal operating property and equipment73,586 68,031 \n\nLess—Accumulated depreciation and amortization(27,466)(25,123)\n\nTotal operating property and equipment, net$46,121 $42,908 \n\nAs of December 31, 2025 and 2024, the Company had a carrying value of computer software of $455 million and $456 million, respectively. For the years ended December 31, 2025, 2024 and 2023, the Company's amortization expense related to computer software was $160 million, $155 million and $168 million, respectively. Aircraft, spare engines and related rotable parts were assumed to have residual values of approximately 10% of original cost, and other categories of property and equipment were assumed to have no residual value.\n\nLeases. The Company enters into various leases as a lessee for assets including, but not limited to, airport facilities, airport gates, hangar sites, administrative offices, aircraft, and various other facilities and equipment to support its operations. The Company determines if an arrangement contains a lease at inception. A lease exists when the arrangement conveys the right to control the use of an identified asset over the lease term. Upon lease commencement, the Company records a lease liability for the obligation to make lease payments and a right-of-use asset for the right to use the underlying asset for the lease term in the consolidated balance sheets. The lease liability is measured at the commencement date based on the present value of lease payments not yet paid over the lease term, which includes extension and renewal options that are reasonably certain of being exercised, discounted using an incremental borrowing rate that reflects the term of the lease and the particular economic environment at lease commencement. The right-of-use asset is based on the lease liability, adjusted for lease prepayments, lease incentives received, and the lessee's initial direct costs. The Company does not record a right-of-use asset or lease liability for leases with an initial term of 12 months or less. Lease and non-lease components are combined for all classes of underlying assets, except for capacity purchase agreements (\"CPAs\") which contain embedded leases for regional aircraft. For these CPAs, the Company allocates consideration to the lease and non-lease components based on their relative standalone values. Many of the Company's leases include variable lease payments, which are not included in the measurement of the right-of-use asset and lease liability. Finance lease right-of-use assets are presented together with Operating property and equipment on the consolidated balance sheets and the related amortization is included in Depreciation and amortization expense.\n\nLong-Lived Asset Impairments. The Company evaluates the carrying value of long-lived assets subject to amortization whenever events or changes in circumstances indicate that an impairment may exist. For purposes of this testing, the Company has generally identified the aircraft fleet type as the lowest level of identifiable cash flows for its mainline fleet and the contract level for its regional fleet under CPAs. An impairment charge is recognized when the asset's carrying value exceeds its net undiscounted future cash flows. The amount of the charge is the difference between the asset's carrying value and fair market value.\n\nIntangible Assets. The Company has finite-lived and indefinite-lived intangible assets, including goodwill. Finite-lived intangible assets are amortized over their estimated useful lives. Goodwill and indefinite-lived intangible assets are not amortized but are assessed for impairment on an annual basis as of October 1, or more frequently if events or circumstances indicate that the asset may be impaired. The Company typically determines fair value using either a market approach or a variation of the income approach valuation techniques. These measurements include the following key assumptions: (1) forecasted revenues, expenses, margin and cash flows, (2) terminal period growth rate, (3) an estimated weighted average cost of capital, (4) asset-specific risk factor and (5) a tax rate. These assumptions are consistent with those that hypothetical market participants would use. We recognize an impairment when the fair value of an intangible asset is less than its carrying value.\n\nFor the Company's China route authority, the Company performed a quantitative assessment which involved determining the fair value of the asset and comparing that amount to the asset's carrying value. For all other intangible assets, the Company performed a qualitative assessment of whether it was more likely than not that an impairment had occurred. To determine the fair value of the China route authority, the Company used a discounted cash flow method. Key assumptions used in the valuation model included forecasted revenues, margin and an overall discount rate. These assumptions are inherently uncertain as they relate to future events and circumstances.\n\nThe following table presents information about the Company's goodwill and other intangible assets at December 31 (in millions):\n\n68\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\n20252024\n\nGross \nCarrying\nAmountAccumulated\nAmortizationGross \nCarrying\nAmountAccumulated\nAmortization\n\nGoodwill$4,527 $4,527 \n\nIndefinite-lived intangible assets\n\nChina route authority$1,020 $1,020 \n\nAirport slots564 564 \n\nTradenames and logos593 593 \n\nAlliances404 404 \n\nTotal$2,581 $2,581 \n\nFinite-lived intangible assets\n\nFrequent flyer database$1,177 $1,112 $1,177 $1,092 \n\nHubs145 144 145 138 \n\nOther143 134 143 133 \n\nTotal$1,465 $1,391 $1,465 $1,363 \n\nAmortization expense in 2025, 2024 and 2023 was $28 million, $32 million and $37 million, respectively. Projected amortization expense in 2026, 2027, 2028, 2029 and 2030 is $18 million, $11 million, $10 million, $8 million and $7 million, respectively.\n\nLabor Costs. The Company records expenses associated with new or amendable labor agreements when the amounts are probable and estimable. These expenses could include costs associated with retro-active lump sum cash payments made in conjunction with the ratification of labor agreements. To the extent these upfront costs are in lieu of future pay increases, they would be capitalized and amortized over the term of the labor agreements. If not, these amounts would be expensed. See Notes 12 and 13 of this report for additional information related to labor agreements.\n\nShare-Based Compensation. The Company measures the cost of employee services received in exchange for an award of equity instruments based on the grant date fair value of the award. The resulting cost is recognized over the period during which an employee is required to provide service in exchange for the award, which is usually the vesting period. Obligations for cash-settled restricted stock units (\"RSUs\") are remeasured at fair value throughout the requisite service period at the close of the reporting period based upon UAL's stock price. In addition to the service requirement, certain RSUs have performance metrics that must be achieved prior to vesting. These awards are accrued based on the expected level of achievement at each reporting period. An adjustment is recorded each reporting period to adjust compensation expense based on the then current level of expected performance achievement for the performance-based awards. See Note 5 of this report for additional information on UAL's share-based compensation plans.\n\nMaintenance and Repairs. The cost of maintenance and repairs, including the cost of minor replacements, is charged to expense as incurred, except for costs incurred under the Company's power-by-the-hour (\"PBTH\") engine maintenance agreements. PBTH contracts transfer certain risk to third-party service providers and fix the amount we pay per flight hour or per cycle to the service provider in exchange for maintenance and repairs under a predefined maintenance program. Under PBTH agreements, the Company recognizes expense at a level rate per engine hour, unless the level of service effort and the related payments during the period are substantially consistent, in which case the Company recognizes expense based on the amounts paid.\n\nAdvertising. Advertising costs, which are included in Other operating expenses, are expensed as incurred. Advertising expenses were $250 million, $235 million and $221 million for the years ended December 31, 2025, 2024 and 2023, respectively.\n\nThird-Party Business. The Company has third-party business activity that includes ground handling, maintenance services, flight academy and frequent flyer award non-travel redemptions. Third-party business revenue is recorded in Other operating revenue. Expenses associated with these third-party business activities are recorded in Other operating expenses, except for non-travel mileage redemptions which are recorded to Other operating revenue.\n\nUncertain Income Tax Positions. The Company has recorded reserves for income taxes and associated interest that may become payable in future years. Although management believes that its positions taken on income tax matters are reasonable, the Company nevertheless established tax and interest reserves in recognition that various taxing authorities may challenge certain\n\n69\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nof the positions taken by the Company, potentially resulting in additional liabilities for taxes and interest. The Company's uncertain tax position reserves are reviewed periodically and are adjusted as events occur that affect its estimates, such as the availability of new information, the lapsing of applicable statutes of limitation, the conclusion of tax audits, the measurement of additional estimated liability, the identification of new tax matters, the release of administrative tax guidance affecting its estimates of tax liabilities, or the rendering of relevant court decisions. The Company records penalties and interest relating to uncertain tax positions as part of income tax expense in its statements of consolidated operations. See Note 7 of this report for additional information on UAL's uncertain tax positions.\n\nFair Value Measurements. The Company measures certain financial assets and liabilities at fair value on a recurring basis, and certain non-financial assets and liabilities on a nonrecurring basis. The Company uses valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows:\n\n•Level 1 - Unadjusted quoted prices in active markets for assets or liabilities identical to those to be reported at fair value\n\n•Level 2 - Other inputs that are observable directly or indirectly, such as quoted prices for similar assets or liabilities or market-corroborated inputs\n\n•Level 3 - Unobservable inputs for which there is little or no market data and which require us to develop our own assumptions about how market participants would price the assets or liabilities.\n\nRecently Issued Accounting Standards\n\nIncome Taxes. In December 2023, the Financial Accounting Standards Board (\"FASB\") issued Accounting Standards Update (\"ASU\") No. 2023-09, \"Income Taxes (Topic 740): Improvements to Income Tax Disclosures.\" This ASU enhances disclosures related to income taxes, including the rate reconciliation and information on income taxes paid. The Company adopted the standard beginning with our annual reporting for fiscal year 2025. The adoption resulted in incremental disclosures. See Note 7 of this report for these disclosures.\n\nInternal-Use Software. In September 2025, the FASB issued ASU No. 2025-06, \"Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40).\" The guidance removes all references to project stages throughout ASC 350-40 and clarifies the threshold entities apply to begin capitalizing costs. This guidance requires internal-use software development cost capitalization to begin when both of the following occur: management has authorized and committed to funding the software project and, it is probable the project will be completed and the software will be used to perform its intended function. The guidance is effective for the Company for annual and interim reporting periods beginning January 1, 2028; early adoption is permitted. The Company early adopted this ASU on January 1, 2026, using the prospective transition approach, which applies this guidance to new software costs incurred starting on the adoption date. The adoption will not have a material impact on the Company's consolidated financial statements.\n\nExpense Disaggregation Disclosures. In November 2024, the FASB issued ASU No. 2024-03, \"Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses.\" This ASU requires disclosing disaggregated information about certain income statement expense captions but does not change the presentation of expense information or expense captions reported on the face of the income statement. This ASU is effective for the Company for annual reporting periods beginning January 1, 2027 and interim reporting periods beginning January 1, 2028; early adoption is permitted. The Company is assessing the impact of this ASU and upon adoption may be required to include certain additional disclosures.\n\nNOTE 2 - REVENUE RECOGNITION\n\nPassenger Revenue. Passenger revenue is recognized when transportation is provided.\n\nPassenger tickets and related ancillary services sold by the Company for flights are purchased primarily via credit card transactions, with payments collected by the Company in advance of the performance of related services. The Company initially records ticket sales in its Advance ticket sales liability, deferring revenue recognition until the travel occurs. For travel that has more than one flight segment, the Company deems each segment as a separate performance obligation and recognizes revenue for each segment as travel occurs. Tickets sold by other airlines where the Company provides the transportation are recognized as passenger revenue at the estimated value to be billed to the other airline when travel is provided. Differences between amounts billed and the actual amounts may be rejected and rebilled or written off if the amount recorded was different from the original estimate. When necessary, the Company records a reserve against its billings and payables with other airlines based on historical experience.\n\n70\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nThe Company sells certain tickets with connecting flights with one or more segments operated by its other airline partners. For segments operated by its other airline partners, the Company has determined that it is acting as an agent on behalf of the other airlines as they are responsible for their portion of the contract (i.e., transportation of the passenger). The Company, as the agent, recognizes revenue within Other operating revenue at the time of the travel for the net amount representing commission to be retained by the Company for any segments flown by other airlines.\n\nRefundable tickets expire after one year from the date of issuance. Non-refundable tickets generally expire on the date of the intended travel, unless the date is extended by notification from the customer on or before the intended travel date.\n\nUnited initially capitalizes the costs of selling airline travel tickets and then recognizes those costs as Distribution expense at the time of travel. Costs to sell a ticket include credit card fees, travel agency and other commissions paid, as well as global distribution systems booking fees.\n\nAdvance ticket sales. Advance ticket sales represent the Company's liability to provide air transportation in the future. All tickets sold at any given point in time have travel dates through the next 12 months. The Company defers amounts related to future travel in its Advance ticket sales liability account.\n\nEstimate of tickets not expected to be used (\"ticket breakage\"). The Company estimates the value of advance ticket sales that will ultimately expire unused based on historical experience and qualitative factors such as recent program changes. The Company recognizes revenue related to these tickets based on the pattern in which concurrently sold tickets are used.\n\nIn the years ended December 31, 2025, 2024 and 2023, the Company recognized approximately $5.8 billion, $5.3 billion and $5.7 billion, respectively, of passenger revenue for tickets that were included in Advance ticket sales at the beginning of those periods.\n\nRevenue by geography. The Company further disaggregates its operating revenue by principal geographic region for the years ended December 31 as presented in the table below (in millions):\n\n202520242023\n\nDomestic (U.S. and Canada)$35,017 $34,067 $32,400 \n\nAtlantic11,647 11,097 10,982 \n\nPacific6,878 6,462 5,267 \n\nLatin America5,528 5,437 5,068 \n\nTotal$59,070 $57,063 $53,717 \n\nThe Company attributes revenue among the geographic regions based upon the origin and destination of each flight segment. The Company's operations involve an insignificant level of revenue-producing assets in geographic regions as the overwhelming majority of the Company's revenue-producing assets (primarily U.S. registered aircraft) can be deployed in any of its geographic regions.\n\nAncillary services. The Company charges fees, separately from ticket sales, for certain ancillary services that are directly related to passenger travel, such as baggage fees, premium seat fees, inflight amenity fees, and other ticket-related fees. These ancillary fees are part of the travel performance obligation and, as such, are recognized as Passenger revenue when the travel occurs. The Company recorded $4.8 billion, $4.5 billion and $4.1 billion of ancillary fees within Passenger revenue in the years ended December 31, 2025, 2024 and 2023, respectively.\n\nTicket taxes. Certain governmental taxes are imposed on the Company's ticket sales through a fee included in ticket prices. The Company collects these fees and remits them to the appropriate government agency. These fees are excluded from the contract transaction price and are therefore not included in passenger revenue. We record a liability when amounts are collected and reduce the liability when payments are made to the appropriate taxing authority.\n\nFrequent Flyer Program. United's MileagePlus loyalty program builds customer loyalty by offering awards, benefits and services to program participants. Members in this program earn miles for travel on United, United Express, Star Alliance members and certain other airlines that participate in the program. Members can also earn miles by purchasing goods and services from our network of non-airline partners. We have contracts to sell miles to these partners with the terms extending from approximately one to five years. These partners include domestic and international credit card issuers, retail merchants, hotels, car rental companies and our participating airline partners. Miles can be redeemed for free (other than taxes and government-imposed fees), discounted or upgraded air travel and non-travel awards.\n\nMiles earned in conjunction with travel. When MileagePlus members earn miles for flights, the Company recognizes a portion of the ticket sales as revenue when the travel occurs and defers a portion of the ticket sale representing the value of the related miles as a separate performance obligation. The Company determines the estimated selling price of travel and miles as if each\n\n71\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nperformance obligation is sold on a separate basis. The total consideration from each ticket sale is then allocated to each of the performance obligations, individually, on a pro-rata basis. At the time of travel, the Company records the portion allocated to the miles to Frequent flyer deferred revenue on the Company's consolidated balance sheet and subsequently recognizes it into revenue when miles are redeemed for air travel and non-travel awards.\n\nEstimate of miles not expected to be redeemed (\"mileage breakage\"). The Company's mileage breakage model is based on the assumption that the likelihood that an account will redeem its miles can be estimated based on a consideration of the account's historical behavior. The Company uses a statistical model to estimate the probability that an account will redeem its current miles balance and reviews its mileage breakage estimates annually. The Company's estimate of the expected mileage breakage requires management judgment. Changes to mileage breakage assumptions, or to program rules and program redemption opportunities, may result in material changes to the deferred revenue balance as well as recognized revenues from the program. We recognize mileage breakage proportionally as the remaining miles are redeemed.\n\nEstimated selling price of miles. The Company's estimated selling price of miles is based on an equivalent ticket value, which incorporates the expected redemption of miles, as the best estimate of the selling price for these miles. The equivalent ticket value is based on the prior 12 months' weighted average equivalent ticket value of similar fares as those used to settle award redemptions while taking into consideration such factors as redemption pattern, cabin class, loyalty status and geographic region. The estimated selling price of miles is adjusted by mileage breakage that considers a number of factors, including redemption patterns of various customer groups.\n\nCo-Brand agreement. United's most significant contract to sell MileagePlus miles is with its co-branded credit card partner JPMorgan Chase Bank USA, N.A. (\"Chase\"). Chase awards miles to MileagePlus members based on their credit card activity. United identified the following significant separately identifiable performance obligations in this contract (the \"Co-Brand Agreement\"):\n\n•MileagePlus miles awarded – United has a performance obligation to provide MileagePlus cardholders with miles to be used for air travel and non-travel award redemptions. The Company records Passenger revenue related to the travel awards when the transportation is provided and records Other operating revenue related to the non-travel awards when the goods or services are delivered. The Company records the cost associated with non-travel awards in Other operating revenue, as an agent.\n\n•Marketing – United has a performance obligation to provide Chase access to United's customer list and the use of United's brand. Marketing revenue is recorded to Other operating revenue as miles are delivered to Chase.\n\n•Advertising – United has a performance obligation to provide advertising in support of the MileagePlus card in various customer contact points such as United's website, email promotions, direct mail campaigns, airport advertising and in-flight advertising. Advertising revenue is recorded to Other operating revenue as miles are delivered to Chase.\n\n•Other travel-related benefits – United's performance obligations are comprised of various items such as waived bag fees, seat upgrades and lounge passes. Lounge passes are recorded to Other operating revenue as customers use the lounge passes. Bag fees and seat upgrades are recorded to Passenger revenue at the time of the associated travel.\n\nWe account for payments received under the Co-Brand Agreement by allocating them to the separately identifiable performance obligations. The fair value of the separately identifiable performance obligations is determined using management's estimated selling price of each component. The objective of using the estimated selling price based methodology is to determine the price at which we would transact a sale if the product or service were sold on a stand-alone basis. Accordingly, we determine our best estimate of selling price by considering multiple inputs and methods including, but not limited to, discounted cash flows, brand value, volume discounts, published selling prices, number of miles awarded and number of miles redeemed. The Company estimated the selling prices and volumes over the term of the Co-Brand Agreement, at the inception of the contract, in order to determine the allocation of proceeds to each of the components to be delivered.\n\nFrequent flyer deferred revenue. Miles in MileagePlus members' accounts are combined into one homogeneous pool and are thus not separately identifiable, for award redemption purposes, between miles earned in the current period and those in their beginning balance. Of the miles expected to be redeemed, the Company expects the majority of these miles to be redeemed within two years. The current portion of the Frequent flyer deferred revenue is based on expected redemptions in the next 12 months. The table below presents a roll forward of Frequent flyer deferred revenue (in millions):\n\n72\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\n20252024\n\nBalance at January 1$7,441 $7,143 \n\nMiles earned3,883 3,563 \n\nTravel miles redeemed(3,414)(3,150)\n\nNon-travel miles redeemed(133)(115)\n\nBalance at December 31$7,777 $7,441 \n\nThe portion of the total amounts received from our various partner agreements that is related to the MileagePlus miles awarded is deferred and presented in the table above as an increase to Frequent flyer deferred revenue. In the years ended December 31, 2025, 2024 and 2023, the Company recognized, in Other operating revenue, $3.2 billion, $2.9 billion and $2.7 billion, respectively, related to the marketing, advertising, non-travel miles redeemed (net of related costs) and other travel-related benefits of the mileage revenue associated with our various partner agreements including, but not limited to, our Co-Brand Agreement.\n\nCargo Revenue. Cargo revenue is recognized when the related shipment arrives at its destination.\n\nNOTE 3 - COMMON STOCKHOLDERS' EQUITY AND PREFERRED SECURITIES\n\nCommon stock. On October 15, 2024, the Company announced that its Board of Directors (the \"Board\") authorized a new share repurchase program, allowing for purchases of up to $1.5 billion in the aggregate of outstanding UAL common stock and certain Warrants (as defined below) issued in connection with the Coronavirus Aid, Relief, and Economic Security Act (the \"CARES Act\"), subject to a limit of $500 million in the aggregate through 2024. In 2025, the Company repurchased 8.1 million shares of UAL common stock at an average price of $78.75 for a total investment of approximately $640 million, including commissions and taxes, as part of the program. As of February 5, 2026, the dollar value of shares that may yet be purchased under the program is approximately $0.8 billion. Unless suspended or terminated earlier by the Board, this program has no set expiration date and will therefore terminate when the Company has completed all purchases authorized under the program. The specific timing and number of shares of UAL common stock or Warrants purchased will be determined by the Company's management at its discretion and will vary based on the capital needs of the business, the market price of UAL common stock, general market conditions, securities law limitations and other factors. The purchases may be effected through a combination of one or more open market and privately negotiated transactions (including under trading plans intended to comply with Rule 10b5-1 under the Securities Exchange Act of 1934, as amended (the \"Exchange Act\")) as well as transactions structured through investment banking institutions and other derivative transactions (including through one or more accelerated share repurchase programs).\n\nIn August 2024, the Company also repurchased, through open market repurchases, following the exercise of the Warrants described below, 2,043,906 shares of UAL common stock, which was recorded as an approximately $82 million increase to Stock held in treasury, at cost. These share repurchases were executed outside of a publicly announced plan or program using cash resources.\n\nAs of December 31, 2025, approximately 3.7 million shares of UAL's common stock were reserved for future issuance related to the issuance of equity-based awards under the Company's incentive compensation plans.\n\nPreferred stock. As of December 31, 2025, UAL had two shares of junior preferred stock (par value $0.01 per share) outstanding. In addition, UAL is authorized to issue 250 million shares of preferred stock (without par value) under UAL's amended and restated certificate of incorporation.\n\nWarrants. In 2020 and 2021, the Company issued to the United States Department of the Treasury (the \"U.S. Treasury\") warrants (\"Warrants\") to purchase 9,928,349 shares of UAL common stock in connection with the Payroll Support Program (\"PSP\") established under Division A, Title IV, Subtitle B of the CARES Act, the Payroll Support Program Extension established under Division N, Title IV, Subtitle A of the Consolidated Appropriations Act, 2021 (\"PSP2\"), the Payroll Support Program 3 established under Title VII, Subtitle C of the American Rescue Plan Act of 2021 (\"PSP3\"), and the Airline Loan Program established under Division A, Title IV, Subtitle A of the CARES Act. In August 2024, the holder of the Warrants exercised 6,414,635 of the Warrants, with an exercise price of $31.50, in a net share settlement for 2,043,906 shares of UAL common stock. In March 2025, the remaining 3,513,714 Warrants were exercised in a net share settlement for 1,801,430 shares of UAL common stock.\n\n73\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nNOTE 4 - EARNINGS PER SHARE\n\nThe following table shows the computation of UAL's basic and diluted earnings per share, the latter of which uses the treasury stock method to calculate the dilutive effect of UAL's potential common stock, for the years ended December 31 (in millions, except per share amounts):\n\n202520242023\n\nEarnings available to common stockholders$3,353 $3,149 $2,618 \n\nBasic weighted-average shares outstanding324.9 328.6 327.8 \n\nDilutive effect of stock Warrants (a)0.3 1.7 2.2 \n\nDilutive effect of employee stock awards3.3 2.9 1.9 \n\nDiluted weighted-average shares outstanding328.5 333.2 331.9 \n\nEarnings per share, basic$10.32 $9.58 $7.98 \n\nEarnings per share, diluted$10.20 $9.45 $7.89 \n\nPotentially dilutive securities (b)\n\nStock Warrants (a)— — 1.5 \n\nEmployee stock awards0.3 0.3 0.6 \n\n(a) See Note 3 of this report for additional information on these Warrants.\n\n(b) Weighted-average potentially dilutive securities outstanding are excluded from the computation of diluted earnings per share because the securities would have an antidilutive effect.\n\nNOTE 5 - SHARE-BASED COMPENSATION PLANS\n\nUAL maintains share-based compensation plans for our management employees and our non-employee directors. These plans provide for grants of nonqualified stock options; incentive stock options (within the meaning of Section 422 of the Internal Revenue Code of 1986); stock appreciation rights (\"SARs\"); restricted stock; RSUs; performance units; cash incentive awards and other equity-based and equity-related awards. An award (other than an option, SAR or cash incentive award) may provide the holder with dividends or dividend equivalents.\n\nAwards are recorded as either equity or a liability in the Company's consolidated balance sheets. Share-based compensation expense is recorded in Salaries and related costs.\n\nDuring 2025, UAL granted share-based compensation awards pursuant to the United Airlines Holdings, Inc. 2021 Incentive Compensation Plan. These share-based compensation awards included approximately 1.8 million RSUs consisting of approximately 1.0 million time-vested RSUs and approximately 0.8 million performance-based RSUs. The time-vested RSUs vest pro-rata, a majority of which vest on February 28th of each year, over a three-year period from the date of grant. Performance-based awards vest either pro-rata, one-third each year, over a three-year period from the date of grant or all at once upon continuous employment with the Company over a three-year period. Payout under the performance-based awards can range from 0% to 300% depending on the achievement level of certain financial and strategic goals. RSUs are generally equity awards settled in stock for domestic employees and liability awards settled in cash for international employees. The cash payments are based on the 20-day average closing price of UAL common stock immediately prior to the vesting date.\n\nThe following table provides information related to UAL's share-based compensation plan cost for the years ended December 31 (in millions):\n\nCompensation cost\n\n202520242023\n\nRSUs$147 $141 $78 \n\nStock options 1 1 2 \n\nTotal$148 $142 $80 \n\nThe table below summarizes UAL's unearned compensation and weighted-average remaining period to recognize costs for all outstanding share-based awards that are probable of being achieved as of December 31, 2025 (in millions, except as noted):\n\n74\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nUnearned CompensationWeighted-Average\nRemaining Period\n(in years)\n\nRSUs$90 1.3\n\nStock options 1 1.7\n\nTotal$91 \n\nRestricted stock units. The table below summarizes UAL's RSU activity for the years ended December 31 (shares in millions):\n\nLiability AwardsEquity Awards\n\nRSUs\nRSUsWeighted-\nAverage\nGrant Price\n\nOutstanding at December 31, 2022\n0.1 3.3 $37.88 \n\nGranted0.1 2.5 43.42 \n\nVested(0.1)(1.6)44.03 \n\nForfeited— (0.1)36.90 \n\nOutstanding at December 31, 2023\n0.1 4.1 38.86 \n\nGranted0.1 3.6 46.65 \n\nVested(0.1)(2.3)39.37 \n\nForfeited— (0.3)43.28 \n\nOutstanding at December 31, 2024\n0.1 5.1 43.89 \n\nGranted— 1.8  79.30 \n\nVested (0.1)(2.9) 45.23 \n\nForfeited — (0.3)53.41 \n\nOutstanding at December 31, 2025\n0.1 3.8 59.13 \n\nThe fair value of RSUs that vested in 2025, 2024 and 2023 was approximately $135 million, $91 million and $76 million, respectively.\n\nAs of December 31, 2025, UAL had recorded a liability of approximately $7 million related to its cash-settled RSUs. UAL paid approximately $6 million, $2 million and $3 million related to its cash-settled RSUs during 2025, 2024 and 2023, respectively.\n\n75\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nNOTE 6 - ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (\"AOCI\")\n\nThe table below presents the components of the Company's AOCI, net of tax (in millions):\n\nPension and\nOther\nPostretirement\nLiabilitiesInvestments and OtherDeferred Taxes (a)\n \n\n \n\nTotal\n\nBalance at December 31, 2022$626 $(35)$(416)$175 \n\nChanges in value(199)31 38 (130)\n\nAmounts reclassified to earnings(138)(b)— 31 (107)\n\nBalance at December 31, 2023289 (4)(347)(62)\n\nChanges in value417 4 (94)327 \n\nAmounts reclassified to earnings(99)(b)— 22 (77)\n\nBalance at December 31, 2024607 — (419)188 \n\nChanges in value(67)14 12 (42)\n\nAmounts reclassified to earnings(123)(b)(3)28 (98)\n\nBalance at December 31, 2025$417 $10 $(379)$48 \n\n(a)Includes approximately $285 million of deferred income tax expense that will not be recognized in net income until the related pension and postretirement benefit obligations are fully extinguished. We consider all income sources, including other comprehensive income, in determining the amount of tax benefit allocated to results from operations.\n\n(b)This AOCI component is included in the computation of net periodic pension and other postretirement costs, specifically the following components: amortization of unrecognized (gain) loss, amortization of prior service credit and other. See Note 8 of this report for additional information on pensions and other postretirement liabilities.\n\nNOTE 7 - INCOME TAXES\n\nThe income tax provision differed from amounts computed at the statutory federal income tax rate and consisted of the following significant components for the years ended December 31 (in millions):\n\n202520242023\n\nIncome tax provision at statutory rate$904 21.0 %$875 21.0 %$711 21.0 %\n\nState income tax provision, net of federal income tax benefit (a)74 1.7 %59 1.4 %37 1.1 %\n\nChange in valuation allowance(68)(1.6)%27 0.6 %(24)(0.7)%\n\nNontaxable or nondeductible items27 0.6 %48 1.2 %39 1.1 %\n\nOther, net16 0.4 %10 0.2 %6 0.2 %\n\nIncome tax expense$953 22.1 %$1,019 24.4 %$769 22.7 %\n\n(a) California and Colorado make up more than 50% of the state income tax expense category in 2025. California, Colorado and Illinois make up more than 50% of the state income tax expense category in 2024 and 2023\n\n76\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nThe components of the income tax provision consisted of the following for the years ended December 31 (in millions):\n\n202520242023\n\nCurrent:\n\nUS Federal$(4)$50 $— \n\nUS State and Local20 288\n\nForeign12 65\n\n Total Current28 8413\n\nDeferred:\n\nUS Federal866 898726\n\nUS State and Local58 3730\n\nTotal Deferred925 935756\n\nTotal income tax expense:\n\nUS Federal862 948726\n\nUS State and Local79 6538\n\nForeign12 65\n\nTotal Income Tax Expense$953 $1,019 $769 \n\nThe following table presents tax payment, net of refunds, by jurisdiction for the years ended December 31 (in million):\n\n202520242023\n\nFederal$33 $47 $1 \n\nState\n\nCalifornia13 25 (4)\n\nIllinois2 5 3 \n\nAll other state2 4 2 \n\nForeign\n\nGuatemala3 3 3 \n\nIndia3 2 1 \n\nAll other foreign6 2 1 \n\nTotal$62 $88 $7 \n\n77\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nTemporary differences and carryforwards that give rise to deferred tax assets and liabilities as of December 31 were as follows (in millions):\n\n UALUnited\n\n2025202420252024\n\nDeferred income tax asset (liability):\n\nFederal and state net operating loss (\"NOL\") carryforwards$2,326 $2,149 $2,298 $2,119 \n\nDeferred revenue1,894 1,865 1,894 1,865 \n\nOperating lease liabilities1,349 1,110 1,349 1,110 \n\nEmployee benefits, including pension, postretirement and medical 701 608 701 608 \n\nOther financial liabilities478 517 478 517 \n\nInterest expense carryforward109 467 109 467 \n\nOther377 565 375 565 \n\nLess: Valuation allowance(151)(208)(151)(208)\n\nTotal deferred tax assets $7,083 $7,073 $7,053 $7,043 \n\nDepreciation$(7,814)$(7,171)$(7,814)$(7,171)\n\nOperating lease right-of-use asset(1,116)(863)(1,116)(863)\n\nIntangible assets(616)(619)(616)(619)\n\nTotal deferred tax liabilities$(9,546)$(8,653)$(9,546)$(8,653)\n\nNet deferred tax asset (liability)$(2,463)$(1,580)$(2,493)$(1,610)\n\nUnited and its domestic consolidated subsidiaries file a consolidated federal income tax return with UAL. Under an intercompany tax allocation policy, United and its subsidiaries compute, record and pay UAL for their own tax liabilities as if they were separate companies filing separate returns. In determining their own tax liabilities, United and each of its subsidiaries take into account all tax credits or benefits generated and utilized as separate companies and they are each compensated for the aforementioned tax benefits on an annual basis.\n\nThe Company's federal and state NOL and tax credit carryforwards relate to prior years' NOLs and credits, which may be used to reduce tax liabilities in future years. These tax benefits are mostly attributable to federal pre-tax NOL carryforwards of $10.6 billion ($2.2 billion tax effected) for UAL as of December 31, 2025. If not utilized, $0.1 billion of these federal pre-tax NOLs will expire in 2029. The remaining $10.5 billion of NOLs have no expiration date. State pre-tax NOLs of $2.8 billion ($0.2 billion tax effected) as of December 31, 2025 expire over a 1 to 20-year period. As of December 31, 2025, state tax credits were $57 million. These credits will expire over a 1 to 15-year period, and an additional $5.5 million of state tax credits have no expiration date.\n\nAs of December 31, 2025, the Company has recorded $108 million of valuation allowance against its capital loss deferred tax assets. Capital losses have a limited carryforward period of five years, and they can be utilized only to the extent of capital gains. The Company does not anticipate generating sufficient capital gains to utilize the losses before they expire, therefore, a valuation allowance is necessary as of December 31, 2025. Additionally, the Company recorded a valuation allowance of $44 million on certain state deferred tax assets primarily due to state NOLs that have short expiration periods.\n\nThe Company's unrecognized tax benefits related to uncertain tax positions were $74 million, $70 million and $66 million at December 31, 2025, 2024 and 2023, respectively. All of the uncertain tax positions would affect the Company's effective tax rate if recognized. Changes in unrecognized tax benefits were immaterial during 2025, 2024 and 2023. There are no material amounts included in the balance at December 31, 2025 for tax positions for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility.\n\nThe Company's federal income tax returns for tax years after 2000 remain subject to examination by the Internal Revenue Service and state taxing jurisdictions.\n\nNOTE 8 - PENSION, POSTRETIREMENT AND OTHER EMPLOYEE BENEFIT PLANS\n\nThe following summarizes the significant pension and other postretirement plans of United:\n\nPension Plans. United maintains two primary defined benefit pension plans, one covering certain pilot employees and another covering certain U.S. non-pilot employees. Each of these plans provides benefits based on a combination of years of benefit\n\n78\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\naccruals service and an employee's final average compensation. Additional benefit accruals are frozen under the plan covering certain pilot employees and for management and administrative employees covered under the non-pilot plan. Benefit accruals for certain non-pilot employees continue. United maintains additional defined benefit pension plans, which cover certain international employees.\n\nOther Postretirement Plans. United maintains postretirement medical programs which provide medical benefits to certain retirees and eligible dependents, as well as life insurance benefits to certain retirees participating in the plan. Benefits provided are subject to applicable contributions, co-payments, deductibles and other limits as described in the specific plan documentation.\n\nActuarial assumption changes are reflected as a component of the net actuarial (gain) loss. The 2025 actuarial losses were primarily related to expected pay increases for certain represented employees partially offset by asset performance. Actuarial (gains) losses are amortized over the average remaining service life of active covered employees.\n\nThe following tables set forth the reconciliation of the beginning and ending balances of the benefit obligation and plan assets, the funded status and the amounts recognized in these financial statements for the defined benefit and other postretirement plans (in millions):\n\nPension Benefits\n\nYear Ended December 31, 2025\n\nYear Ended December 31, 2024\n\nAccumulated benefit obligation:$3,959 $3,752 \n\nChange in projected benefit obligation:\n\nProjected benefit obligation at beginning of year$4,315 $4,550 \n\nService cost127 135 \n\nInterest cost243 229 \n\nActuarial (gain) loss149 (460)\n\nBenefits paid(217)(135)\n\nOther6 (4)\n\nProjected benefit obligation at end of year$4,624 $4,315 \n\nChange in plan assets:\n\nFair value of plan assets at beginning of year$3,601 $3,599 \n\nActual return on plan assets357 132 \n\nEmployer contributions298 5 \n\nBenefits paid(217)(135)\n\nOther8 — \n\nFair value of plan assets at end of year$4,047 $3,601 \n\nFunded status—Net amount recognized$(577)$(714)\n\nPension Benefits\n\nDecember 31, 2025December 31, 2024\n\nAmounts recognized in the consolidated balance sheets consist of:\n\nNoncurrent asset$23 $22 \n\nCurrent liability(6)(7)\n\nNoncurrent liability(594)(729)\n\nTotal liability$(577)$(714)\n\nAmounts recognized in accumulated other comprehensive income consist of:\n\nNet actuarial gain$21 $95 \n\nTotal accumulated other comprehensive gain$21 $95 \n\n79\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nOther Postretirement Benefits\n\nYear Ended December 31, 2025\n\nYear Ended December 31, 2024\n\nChange in benefit obligation:\n\nBenefit obligation at beginning of year$590 $746 \n\nService cost6 5 \n\nInterest cost31 38 \n\nParticipant contributions60 65 \n\nBenefits paid(148)(163)\n\nActuarial (gain) loss(1)(101)\n\nBenefit obligation at end of year$538 $590 \n\nChange in plan assets:\n\nFair value of plan assets at beginning of year$45 $46 \n\nActual return on plan assets1 1 \n\nEmployer contributions85 96\n\nParticipant contributions60 65 \n\nBenefits paid(148)(163)\n\nFair value of plan assets at end of year43 45 \n\nFunded status—Net amount recognized$(495)$(545)\n\nOther Postretirement Benefits\n\nDecember 31, 2025December 31, 2024\n\nAmounts recognized in the consolidated balance sheets consist of:\n\nCurrent liability$(30)$(41)\n\nNoncurrent liability(465)(504)\n\nTotal liability$(495)$(545)\n\nAmounts recognized in accumulated other comprehensive income consist of:\n\nNet actuarial gain$354 $383 \n\nPrior service credit43 129 \n\nTotal accumulated other comprehensive income$396 $512 \n\nThe following information relates to all pension plans with an accumulated benefit obligation and a projected benefit obligation in excess of plan assets at December 31 (in millions):\n\n20252024\n\nProjected benefit obligation$4,486 $4,179 \n\nAccumulated benefit obligation3,821 3,617 \n\nFair value of plan assets3,886 3,443 \n\n80\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nNet periodic benefit cost (credit) for the years ended December 31 included the following components (in millions):\n\n202520242023\n\nPension BenefitsOther Postretirement BenefitsPension BenefitsOther Postretirement BenefitsPension BenefitsOther Postretirement Benefits\n\nService cost$127 $6 $135 $5 $124 $4 \n\nInterest cost243 31 229 38 217 42 \n\nExpected return on plan assets(273)(1)(276)(1)(251)(1)\n\nAmortization of unrecognized actuarial (gain) loss(7)(31)19 (26)8 (38)\n\nAmortization of prior service (credits) cost— (86)— (93)1 (112)\n\nOther1 — 1 — 3 — \n\nNet periodic benefit cost (credit)$91 $(81)$108 $(77)$102 $(105)\n\nService cost is recorded in Salaries and related costs on the statement of consolidated operations. All other components of net periodic benefit costs are recorded in Miscellaneous, net on the statement of consolidated operations.\n\nThe assumptions used for the benefit plans were as follows:\n\nPension Benefits\n\nAssumptions used to determine benefit obligations20252024\n\nDiscount rate5.62 %5.67 %\n\nRate of compensation increase3.85 %3.85 %\n\nAssumptions used to determine net expense\n\nDiscount rate5.67 %5.04 %\n\nExpected return on plan assets7.81 %7.97 %\n\nRate of compensation increase3.85 %3.84 %\n\nOther Postretirement Benefits\n\nAssumptions used to determine benefit obligations20252024\n\nDiscount rate5.43 %5.70 %\n\nAssumptions used to determine net expense\n\nDiscount rate5.70 %5.43 %\n\nExpected return on plan assets3.00 %3.00 %\n\nHealth care cost trend rate assumed for next year7.00 %6.75 %\n\nRate to which the cost trend rate is assumed to decline (ultimate trend rate in 2035)4.50 %4.50 %\n\nThe Company used the Society of Actuaries' PRI-2012 Private Retirement Plans Mortality Tables projected generationally using the Society of Actuaries' MP-2021 projection scale.\n\nThe Company selected the 2025 discount rate for substantially all of its plans by using a hypothetical portfolio of high-quality bonds at December 31, 2025 that would provide the necessary cash flows to match projected benefit payments.\n\nWe develop our expected long-term rate of return assumption for our defined benefit plans based on historical experience and by evaluating input from the trustee managing the plans' assets. Our expected long-term rate of return on plan assets for these plans is based on a target allocation of assets, which is based on our goal of earning the highest rate of return while maintaining risk at acceptable levels. The plans strive to have assets sufficiently diversified so that adverse or unexpected results from one security class will not have an unduly detrimental impact on the entire portfolio. Plan fiduciaries regularly review our actual asset allocation and the pension plans' investments are periodically rebalanced to our targeted allocation when considered appropriate. United's plan assets are allocated within the following guidelines:\n\n81\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\n  Percent of TotalExpected Long-Term\nRate of Return\n\nEquity securities\n27 - 55\n%9 %\n\nFixed-income securities\n33 - 61\n 8  \n\nAlternatives\n7 - 25\n 7  \n\nFair value information. Assets and liabilities measured at fair value are based on the following valuation techniques:\n\nMarket approach. Prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities.\n\nIncome approach. Techniques to convert future amounts to a single current value based on market expectations (including present value techniques, option-pricing and excess earnings models).\n\nThe following tables present information about United's pension and other postretirement plan assets at December 31 (in millions):\n\n20252024\n\nPension Plan Assets:TotalLevel 1Level 2Level 3Assets Measured at NAV(a)TotalLevel 1Level 2Level 3Assets Measured at NAV(a)\n\nEquity securities$1,421 $108 $4 $184 $1,125 $1,231 $92 $4 $150 $985 \n\nFixed-income securities1,601 — 107 9 1,485 1,359 — 100 1 1,258 \n\nAlternatives763 — — 109 654 762 — — 116 646 \n\nOther investments262 8 154 1 99 249 14 153 2 80 \n\nTotal$4,047 $117 $265 $302 $3,364 $3,601 $106 $257 $269 $2,969 \n\nOther Postretirement Benefit Plan Assets:\n\nDeposit administration fund$43 $— $— $43 $— $45 $— $— $45 $— \n\n(a) In accordance with the relevant accounting standards, certain investments that are measured at fair value using the net asset value (\"NAV\") per share (or its equivalent) have not been classified in the fair value hierarchy. These investments are commingled funds that invest in equity securities and fixed-income instruments including bonds, debt securities, and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. Redemption periods for these investments range from daily to semiannually.\n\nEquity and Fixed-Income. Equity securities include investments in both developed market and emerging market equity securities. Fixed-income securities include primarily U.S. and non-U.S. government fixed-income securities and non-U.S. corporate fixed-income securities, as well as securitized debt securities.\n\nDeposit Administration Fund. This investment is a stable value investment product structured to provide investment income.\n\nAlternatives. Alternative investments consist primarily of investments in hedge funds, real estate and private equity interests.\n\nOther investments. Other investments consist of primarily cash equivalents, as well as insurance contracts.\n\nThe following table presents reconciliation of United's benefit plan assets measured at fair value using unobservable inputs (Level 3) for the years ended December 31 (in millions):\n\n20252024\n\nBalance at beginning of year$314 $322 \n\nActual return (loss) on plan assets:\n\nSold during the year— 1 \n\nHeld at year end36 6 \n\nPurchases, sales, issuances and settlements (net)(5)(15)\n\nBalance at end of year$345 $314 \n\nFunding requirements for tax-qualified defined benefit pension plans are determined by government regulations. The Company expects to make required contributions to its tax-qualified defined benefit pension plans in 2026. In 2026, anticipated employer\n\n82\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\ncontributions to all of United's pension and postretirement plans are at least $259 million and approximately $66 million, respectively.\n\nThe estimated future benefit payments, net of expected participant contributions, in United's pension plans and other postretirement benefit plans for the next ten years, as of December 31, 2025, are as follows (in millions):\n\nPensionOther Postretirement\n\n2026$354 $75 \n\n2027367 66 \n\n2028386 62 \n\n2029383 59 \n\n2030383 54 \n\nYears 2031 – 20351,927 199 \n\nDefined Contribution Plans. United offers several defined contribution plans to its employees. Depending upon the employee group, employer contributions consist of matching contributions and/or non-elective employer contributions. United's employer contribution percentages to its primary 401(k) defined contribution plans vary from 1% to 17% of eligible earnings depending on the terms of each plan. United recorded expenses for its primary 401(k) defined contribution plans of $1.3 billion, $1.2 billion and $960 million in the years ended December 31, 2025, 2024 and 2023, respectively, within Salaries and related costs in the Company's statements of consolidated operations.\n\nMulti-Employer Plans. United contributes to the IAM National Pension Plan (\"IAM Plan\") under the terms of collective bargaining agreements that cover certain of its employees represented by the International Association of Machinists and Aerospace Workers (the \"IAM\"). The IAM Plan provides for retirement, death and/or termination benefits for eligible employees within the applicable collective bargaining units, based on specific eligibility and participation requirements, vesting periods and benefit formulas. The risks of participating in these multi-employer plans are different from single-employer plans, as United may be subject to additional risks that others do not meet their obligations, which in certain circumstances could revert to United, or if a withdrawal from a multi-employer plan occurs for United.\n\nThe IAM Plan reported $640 million of employer contributions for the year ended December 31, 2024. For 2024, the Company's contributions to the IAM Plan represented more than 5% of total contributions to the IAM Plan. The 2025 information is not available as the applicable Form 5500 is not final for the plan year. United's participation in the IAM Plan for the annual period ended December 31, 2025 is outlined in the table below.\n\nPension FundIAM National Pension Fund (\"IAM Fund\")\n\nEIN/ Pension Plan Number51-6031295 — 002\n\nPension Protection Act Zone Status (2025 and 2024)\nCritical (2025 and 2024). A plan is in \"critical\" status if the funded percentage is less than 65 percent. On April 17, 2019, the IAM National Pension Fund Board of Trustees voluntarily elected for the IAM Fund to be in critical status effective for the plan year beginning January 1, 2019 to strengthen the IAM Fund's financial health. The IAM Fund's funded percentage was 88.0% as of January 1, 2024.\n\nFIP/RP Status Pending/Implemented\nA 10-year Rehabilitation Plan effective, January 1, 2022, was adopted on April 17, 2019 that requires the Company to make an additional contribution of 2.5% of the hourly contribution rate, compounded annually for the length of the Rehabilitation Plan, effective June 1, 2019.\n\nUnited's Contributions\n$97 million, $95 million and $87 million in the years ended December 31, 2025, 2024 and 2023, respectively.\n\nSurcharge ImposedNo\n\nExpiration Date of Collective Bargaining AgreementN/A\n\nProfit Sharing. Substantially all of our employees are eligible to participate in our profit sharing plan. Under the plan, for each year in which our adjusted pre-tax profit (which is calculated as pre-tax profit, excluding unusual, special or non-recurring charges, profit sharing expense and share-based compensation) exceeds a certain amount, a specified portion of that profit will be distributed to eligible employees. The Company recorded profit sharing and related payroll tax expense of $704 million,\n\n83\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\n$713 million and $681 million in 2025, 2024 and 2023, respectively. Profit sharing expense is recorded as a component of Salaries and related costs in the Company's statements of consolidated operations.\n\nNOTE 9 - FAIR VALUE MEASUREMENTS, INVESTMENTS AND NOTES RECEIVABLE\n\nFair Value Measurement. The table below presents the fair value of financial assets and liabilities measured at fair value, based on the inputs described in Note 1, on a recurring basis in the Company's financial statements as of December 31 (in millions):\n\n20252024\n\nTotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3\n\nCash and cash equivalents$5,942 $5,942 $— $— $8,769 $8,769 $— $— \n\nRestricted cash - current— — — — 11 11 — — \n\nRestricted cash - non-current139 139 — — 166 166 — — \n\nShort-term investments:\n\nCorporate debt3,399 — 3,399 — 3,127 — 3,127 — \n\nU.S. government and agency notes2,465 — 2,465 — 2,280 — 2,280 — \n\nCertificates of deposit placed through an account registry service (\"CDARS\")— — — — 59 — 59 — \n\nOther fixed-income securities433 — 433 — 240 — 240 — \n\nLong-term investments:\n\nEquity securities34 34 — — 71 71 — — \n\nInvestments presented in the table above have the same fair value as their carrying value.\n\nShort-term investments — The short-term investments shown in the table above are classified as available-for-sale and have remaining maturities of less than two years.\n\nLong-term investments: Equity securities — Represents equity and equity-linked securities (such as vested warrants) that make up United's investments in Azul Linhas Aéreas Brasileiras S.A. (\"Azul\"), Archer Aviation Inc. and Eve Holding, Inc. Equity securities at December 31, 2024 also included Mesa Air Group, Inc. (\"Mesa\").\n\nOn May 28, 2025, Azul announced it had entered into restructuring agreements with its key stakeholders and strategic partners, including United, to effectuate a proactive reorganization process. On November 7, 2025, United entered into an equity investment agreement with Azul and certain of Azul's subsidiaries, pursuant to which United subscribed for $100 million of Azul shares in connection with Azul's completion of the reorganization process. Consummation of United's investment is subject to the satisfaction of certain conditions precedent, including but not limited to completion of Azul's reorganization plan.\n\nOther fair value information - The table below presents the carrying values and estimated fair values of financial instruments not presented in the tables above as of December 31 (in millions). Carrying amounts include any related discounts, premiums and issuance costs:\n\n20252024\n\nCarrying AmountFair ValueCarrying AmountFair Value\n\nTotalLevel 1Level 2Level 3TotalLevel 1Level 2Level 3\n\nLong-term debt$21,266 $21,489 $— $14,030 $7,458 $24,653 $24,423 $— $17,300 $7,123 \n\nFair value of the financial instruments included in the tables above was determined as follows:\n\nDescriptionFair Value Methodology\n\nCash and cash equivalents and\nRestricted cash (current and non-current)The carrying amounts of these assets approximate fair value.\n\nShort-term and Long-term investmentsFair value is based on (a) the trading prices of the investment or similar\ninstruments or (b) broker quotes obtained by third-party valuation services.\n\nLong-term debt Fair values are based on either market prices or the discounted amount of future cash flows using our current incremental rate of borrowing for similar liabilities.\n\n84\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nEquity Method Investments. As of December 31, 2025, United holds investments, accounted for using the equity method, with a combined carrying value of approximately $273 million. Significant equity method investments are described below:\n\n•Republic Airways Holdings Inc. On November 25, 2025, Mesa consummated the transactions contemplated by the Agreement, Plan of Conversion and Plan of Merger, dated April 4, 2025 (the \"Merger Agreement\"), with Republic Airways Holdings Inc. (\"Legacy Republic\"). Subject to the terms and conditions of the Merger Agreement, Legacy Republic merged with and into Mesa (the \"Merger\"), with the Mesa legal entity continuing as the surviving corporation following the Merger and renamed \"Republic Airways Holdings Inc.\" (\"Republic\"). Concurrent with the execution of the Merger Agreement, Legacy Republic, Mesa and its affiliates, and United entered into a Three Party Agreement that provided for certain actions to be taken subject to the terms and conditions therein to facilitate transactions related to the Merger, including United's commitment to facilitate, by making certain financial contributions to Mesa, Mesa's disposition of certain assets and its extinguishment of certain liabilities in exchange for United receiving additional shares of up to 6% of the total equity interests of Republic, subject to final determination within 60 days of the completion of the Merger. As of December 31, 2025, United accounted for the consideration to be received within Receivables, net on its consolidated balance sheets. On February 3, 2026, the Company and Republic reached an agreement on the remaining shares and the Company received an additional allocation of 2,744,348 shares, or approximately 5.8% of Republic, for a total ownership interest of approximately 22.3% of the issued and outstanding common stock of Republic. As of December 31, 2025, United held approximately 16.5% minority interest in Republic. As of December 31, 2024, United held a 19% minority interest in Legacy Republic and a 10% minority interest in Mesa. Republic Airways Inc. currently operates 66 regional aircraft under CPAs with United that have terms through 2037. Mesa Airlines, Inc. currently operates 60 regional aircraft under a CPA with a term through 2036.\n\n•CommuteAir LLC. United owns a 40% minority ownership stake in CommuteAir LLC (\"CommuteAir\"). CommuteAir currently operates 59 regional aircraft under a CPA that has a term through 2028.\n\n•United Airlines Ventures Sustainable Flight Fund (the \"Fund\"). United holds, through its corporate venture capital arm, United Airlines Ventures, Ltd., a 33% ownership interest in the Fund. The Fund is an investment vehicle designed to support start-ups developing technologies focused on decarbonizing aviation and its associated energy supply chains, including through research and production, and technologies associated with sustainable aviation fuel (SAF).\n\nOther Investments. United has equity investments in Abra Group Limited, a multinational airline holding company, JetSuiteX, Inc., an independent air carrier doing business as JSX, as well as a number of companies with emerging technologies and sustainable solutions. None of these investments have readily determinable fair values. We account for these investments at cost less impairment, adjusted for observable price changes in orderly transactions for an identical or similar investment of the same issuer. As of December 31, 2025, the carrying value of these investments was $339 million.\n\nNotes Receivable. As of December 31, 2025, the Company has $54 million of notes receivable, net of allowance for credit losses, the majority of which is from certain of its regional carriers. The current portions of the notes receivable are recorded in Receivables, net and the noncurrent portions are recorded in Investments in affiliates and other, net on the Company's consolidated balance sheet.\n\n85\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nNOTE 10 - DEBT\n\n(In millions)Maturity DatesInterest Rate(s) at December 31, 2025At December 31,\n\n20252024\n\nEquipment Notes (a)2026—20372.70%—6.25%$11,708 $12,983 \n\n2026 and 2029 Notes2026—20294.38%—4.63%4,000 4,000 \n\n2024 Term Loans (b)20315.73%2,061 2,082 \n\nMileagePlus Senior Secured Notes\nn/an/a— 1,900 \n\nOther secured debt2029—20354.00%—5.25%361295 \n\nUnsecured\n\nPSP Notes (c)2030—20311.00%—5.93%3,181 3,181 \n\nNotesn/an/a— 315 \n\nOther unsecured debt20275.75%71 81 \n\n21,383 24,837 \n\nLess: unamortized debt discount, premiums and debt issuance costs (117)(184)\n\nLess: current portion of long-term debt(4,096)(2,973)\n\nLong-term debt, net$17,170 $21,680 \n\n(a)Financing includes variable rate debt based on the Secured Overnight Financing Rate (\"SOFR\") (or another index rate), generally subject to a floor, plus a specified margin of 0.64% to 2.00%.\n\n(b)Financing includes variable rate debt based on SOFR (or another index rate), subject to a floor, plus a specified margin of 2.00%.\n\n(c)The PSP Notes include $1.50 billion of indebtedness evidenced by a 10-year senior unsecured promissory note with Treasury provided under PSP, $0.9 billion of indebtedness evidenced by a 10-year senior unsecured promissory note issued to Treasury pursuant to PSP2 and $0.8 billion of indebtedness evidenced by a 10-year senior unsecured promissory note issued to Treasury pursuant to PSP3. These PSP Notes have a rate of 1.00% in years 1 through 5, and a rate of the SOFR plus 2.00% in years 6 through 10.\n\nAs of December 31, 2025, we had $3.0 billion undrawn and available under our revolving credit facility.\n\nThe table below presents the Company's contractual principal payments (not including debt discount or debt issuance costs) as of December 31, 2025 under then-outstanding long-term debt agreements (in millions):\n\n20262027202820292030After 2030Total\n\nContractual principal payments$4,096 $2,011 $1,839 $2,932 $2,467 $8,039 $21,383 \n\nIn 2025, United borrowed $0.5 billion aggregate principal amount from financial institutions to finance the purchase of aircraft. The notes evidencing these borrowings, which are secured by the related aircraft, mature between 2035 and 2037 and bear interest equal to Term SOFR plus a margin with variable rates ranging from 5.29% to 5.39%.\n\nIn November 2025, at the request of United, the Greater Orlando Aviation Authority issued its approximately $258 million special purpose airport facilities revenue bonds and loaned the proceeds of such bonds to United pursuant to a loan agreement to finance a portion of the costs of constructing certain airport improvements, including a hangar among other facilities, to be installed and leased by United at Orlando International Airport. The bonds bear interest at 5.25% to 5.50% per annum, payable semiannually, commencing May 1, 2026 through the November 1, 2037 final maturity date. As security for United's obligations under the loan agreement, United also entered into a leasehold mortgage which grants to the trustee of the bonds (acting on behalf of the bondholders) a lien on United's interest in the leased premises and any improvements thereon owned by or leased to United. As of December 31, 2025, United had recorded approximately $71 million related to this debt.\n\n86\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nOn July 7, 2025, Mileage Plus Holdings, LLC (\"MPH\"), a direct wholly owned subsidiary of United, and Mileage Plus Intellectual Property Assets, Ltd., an indirect wholly owned subsidiary of MPH (\"MIPA\" and, together with MPH, the \"Issuers\"), redeemed in full (the \"Redemption\") all $1.52 billion aggregate principal amount of the Issuers' outstanding MileagePlus 6.5% senior secured notes due 2027 (the \"MileagePlus Senior Secured Notes\"), which were secured by substantially all of the assets of the Issuers and their subsidiaries. As a result of the Redemption and the July 2024 voluntarily prepayment in full of the $1.80 billion outstanding principal balance of the secured term loan facility, which was secured ratably with the MileagePlus Senior Secured Notes, all indebtedness secured by the MileagePlus assets have been fully repaid.\n\nOur debt agreements contain customary terms and conditions as well as various affirmative, negative and financial covenants that, among other things, limit our ability under certain circumstances to create liens on collateral, make certain dividends, stock repurchases, restricted investments and other restricted payments, and consolidate, merge, sell, or otherwise dispose of all or substantially all of our assets. Our debt agreements also contain events of default customary for similar financings including, in certain cases, cross-payment default and cross-acceleration to other material indebtedness. Certain of our debt agreements contain financial covenants that require the Company to maintain at least $2.0 billion of unrestricted liquidity at all times, which includes unrestricted cash, certain liquid and short-term investments and any undrawn amounts under any revolving credit facility, and to maintain a minimum ratio of appraised value of collateral to the outstanding debt secured by such collateral on a senior basis of 1.6 to 1.0, tested semi-annually. As of December 31, 2025, the Company was in compliance with its debt covenants under these agreements.\n\nOn February 2, 2026, UAL issued, in a public offering, $1,000,000,000 principal amount of its 5.375% Senior Notes due 2031 (the \"2031 Notes\"), which are guaranteed by United. The 2031 Notes, issued at a price of 100% of their principal amount, bear interest at a rate of 5.375% per annum, payable semi-annually on March 1 and September 1 of each year, beginning September 1, 2026 and maturing on March 1, 2031. UAL, at its option, may redeem the 2031 Notes at any time prior to September 1, 2030, in whole or in part, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2031 Notes to be redeemed and (2) a make-whole amount, if any, plus accrued and unpaid interest on the principal amount being redeemed to the redemption date. At any time on or after September 1, 2030, UAL may redeem the 2031 Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the 2031 Notes to be redeemed, plus accrued and unpaid interest on the principal amount being redeemed to the redemption date.\n\nOn February 3, 2026, the Company entered into Amendment No. 4 to Term Loan Credit and Guaranty Agreement (2024 Term Loans) that lowered the margin on its interest rate to 1.75%, in the case of Term SOFR Rate (as such term is defined in the Term Loan Credit and Guaranty Agreement, dated as of April 21, 2021, as amended) loans, and 0.75%, in the case of loans at other market rates.\n\nOn February 6, 2026, UAL issued, in a public offering, $1,000,000,000 principal amount of its 4.875% Senior Notes due 2029 (the \"2029 Notes\"), which are guaranteed by United. The 2029 Notes, issued at a price of 100% of their principal amount, bear interest at a rate of 4.875% per annum, payable semi-annually on March 1 and September 1 of each year, beginning September 1, 2026 and maturing on March 1, 2029. UAL, at its option, may redeem the 2029 Notes at any time prior to December 1, 2028, in whole or in part, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2029 Notes to be redeemed and (2) a make-whole amount, if any, plus accrued and unpaid interest on the principal amount being redeemed to the redemption date. At any time on or after December 1, 2028, UAL may redeem the 2029 Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the 2029 Notes to be redeemed, plus accrued and unpaid interest on the principal amount being redeemed to the redemption date.\n\nNOTE 11 - LEASES\n\nUnited leases aircraft, airport passenger terminal space, aircraft hangars and related maintenance facilities, cargo terminals, other airport facilities, other commercial real estate, office and computer equipment and vehicles, among other items. Certain of these leases include provisions for variable lease payments which are based on several factors, including, but not limited to, relative leased square footage, available seat miles, enplaned passengers, passenger facility charges, terminal equipment usage fees, departures, and airports' annual operating budgets. Due to the variable nature of these payments, they are not included in the calculation of the right-of-use asset and lease liability.\n\nLease Cost. The Company's lease cost for the years ended December 31 included the following components (in millions):\n\n87\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\n202520242023\n\nOperating lease cost$894 $855 $925 \n\nVariable and short-term lease cost4,003 3,592 3,028 \n\nAmortization of finance lease assets86 62 52 \n\nInterest on finance lease liabilities15 16 20 \n\nSublease income(33)(35)(39)\n\nTotal lease cost$4,964 $4,490 $3,986 \n\nLease Terms and Commitments. United's leases include aircraft leases for aircraft that are directly leased by United and aircraft that are operated by regional carriers on United's behalf under CPAs (but excluding aircraft owned by United) and non-aircraft leases. Aircraft operating leases relate to leases of 81 mainline and 217 regional aircraft while finance leases relate to leases of 27 mainline and 11 regional aircraft. United's aircraft leases have remaining lease terms of up to 12 years with expiration dates ranging from 2026 through 2037. Under the terms of most aircraft leases, United has the right to purchase the aircraft at the end of the lease term, in some cases at fair market value, and in others, at a percentage of cost.\n\nIn addition, United also has 63 leases of Boeing 737 MAX, Boeing 787 and Airbus A321neo aircraft under various sale-leaseback transactions. These transactions did not qualify as a sale under the applicable accounting guidance, and, as such, the associated aircraft remain on the Company's consolidated balance sheet as part of Operating property and equipment, net. The related obligations are recorded in Current maturities of long-term debt, finance leases, and other financial liabilities and Long-term debt, finance leases, and other financial liabilities. These aircraft leases have remaining lease terms of 7 years to 11 years with expiration dates ranging from 2032 through 2037.\n\nNon-aircraft leases have remaining lease terms of 1 month to 32 years.\n\nThe table below summarizes the Company's scheduled future minimum lease payments under operating and finance leases, recorded on the balance sheet, as of December 31, 2025 (in millions):\n\nOperating LeasesFinance Leases\n\n2026$929 $101 \n\n20271,123 241 \n\n2028941 148 \n\n2029745 21 \n\n2030790 2 \n\nAfter 20303,642 2 \n\nMinimum lease payments8,170 516 \n\nImputed interest(2,121)(42)\n\nPresent value of minimum lease payments6,048 474 \n\nLess: current maturities of lease obligations(631)(96)\n\nLong-term lease obligations$5,417 $378 \n\n88\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nThe table below presents the Company's future contractual lease payments at December 31, 2025 under then-outstanding sale and leaseback agreements that did not qualify as a sale under the applicable accounting guidance (in millions):\n\nOther Financial Liabilities\n\n2026$398 \n\n2027563 \n\n2028236 \n\n2029235 \n\n2030232 \n\nAfter 20302,704 \n\n4,368 \n\nImputed interest(1,120)\n\nCurrent maturities of other financial liabilities(235)\n\nOther financial liabilities$3,014 \n\nIn November 2024, at the request of United, the City of Houston, Texas issued special facility revenue bonds in the par amount of approximately $1.1 billion (the \"IAH SFRBs\") to fund a portion of the costs of construction, reconfiguration and redevelopment of portions of Terminal B at George Bush Intercontinental Airport. The IAH SFRBs have interest rates ranging from 5.25% to 5.50% per annum, payable semiannually, commencing in July 2025 through the July 2039 maturity date of the IAH SFRBs. United is accounting for the lease payments related to these IAH SFRBs as an operating lease recognized as a right-of-use asset and lease liability on the Company's balance sheet.\n\nAs of December 31, 2025, we had entered into leases with rental obligations of approximately $6.6 billion for several mainline aircraft, regional aircraft under CPAs, airport facilities, including the lease associated with the IAH SFRBs described above, and office space, none of which had commenced as of such date. These leases will commence between 2026 and 2028 with lease terms of up to 28 years.\n\nOur lease agreements do not provide a readily determinable implicit rate nor is it available to us from our lessors. Instead, we estimate United's incremental borrowing rate based on information available at lease commencement in order to discount lease payments to present value. The table below presents additional information related to our leases as of December 31:\n\n20252024\n\nWeighted-average remaining lease term - operating leases11 years11 years\n\nWeighted-average remaining lease term - finance leases2 years2 years\n\nWeighted-average remaining lease term - other financial liabilities9 years10 years\n\nWeighted-average discount rate - operating leases6.0 %5.9 %\n\nWeighted-average discount rate - finance leases5.3 %5.9 %\n\nWeighted-average interest rate - other financial liabilities5.8 %5.3 %\n\nThe table below presents supplemental cash flow information related to leases during the years ended December 31 (in millions):\n\n202520242023\n\nCash paid for amounts included in the measurement of lease liabilities:\n\nOperating cash flows for operating leases$971 $851 $874 \n\nOperating cash flows for finance leases15 15 21 \n\nFinancing cash flows for finance leases174 269 311 \n\n89\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nNOTE 12 - COMMITMENTS, CONTINGENCIES, AND GUARANTEES    \n\nPurchase Commitments. The table below summarizes United's firm commitments as of December 31, 2025, which include aircraft and related spare engines, aircraft improvements and non-aircraft commitments (in billions):\n\n20262027202820292030After 2030Total\n\nPurchase commitments$12.6 $5.6 $7.4 $9.0 $8.7 $13.8 $57.0 \n\nAircraft commitments included in the table above are based on contractual scheduled aircraft deliveries. The amount and timing of these commitments could change to the extent that: (i) the Company and the aircraft manufacturers, with whom the Company has existing orders for new aircraft, agree to modify (or further modify) the contracts governing those orders, (ii) rights are exercised pursuant to the relevant agreements to cancel deliveries or modify the timing of deliveries, or (iii) the aircraft manufacturers are unable to deliver in accordance with the terms of those orders.\n\nRegional CPAs. United has contractual relationships with various regional carriers to provide regional aircraft service branded as United Express. Under these CPAs, the Company pays the regional carriers contractually agreed fees (carrier costs) for operating these flights plus a variable rate adjustment based on agreed performance metrics, subject to annual adjustments. The fees are based on rates multiplied by specific operating statistics (e.g., block hours, departures), as well as fixed monthly amounts. Under these CPAs, the Company is also responsible for all fuel costs incurred, as well as landing fees and other costs, which are either passed through by the regional carrier to the Company without any markup or directly incurred by the Company. In some cases, the Company owns some or all of the aircraft subject to the CPA and leases such aircraft to the regional carrier. United's CPAs are for 424 regional aircraft as of December 31, 2025, and the CPAs have terms expiring through 2037. Aircraft operated under CPAs include aircraft leased directly from the regional carriers and those owned by United and operated by the regional carriers. In 2025, United amended several of its CPAs with certain of its regional carriers to amend the contractually agreed fees (carrier costs) paid to those carriers, modify the terms for certain aircraft, and modify service entry dates for certain new aircraft.\n\nUnited recorded approximately $1.1 billion, $1.1 billion and $1.1 billion in expenses related to its CPAs with its regional carriers in which United is a minority shareholder, for the years ended December 31, 2025, 2024 and 2023, respectively. United had prepaid assets and accounts and notes receivables with combined carrying values of $82 million and $52 million with these companies, as of December 31, 2025 and 2024, respectively. There were $165 million and $110 million of liabilities due to these companies as of December 31, 2025 and 2024, respectively. The CPAs with these related parties were executed in the ordinary course of business.\n\nOur future commitments under our CPAs are dependent on numerous variables, and are, therefore, difficult to predict. The most important of these variables is the number of scheduled block hours. Although we are not required to purchase a minimum number of block hours under certain of our CPAs, we have set forth below estimates of our future payments under the CPAs based on our assumptions. The actual amounts we pay to our regional operators under CPAs could differ materially from these estimates. United's estimates of its future payments under all of the CPAs do not include the portion of the underlying obligation for any aircraft leased to a regional carrier or deemed to be leased from other regional carriers and facility rent that are disclosed as part of operating leases in Note 11. For purposes of calculating these estimates, we have assumed (1) the number of block hours flown is based on our anticipated level of flight activity or at any contractual minimum utilization levels if applicable, whichever is higher, (2) that we will reduce the fleet as rapidly as contractually allowed under each CPA, (3) that aircraft utilization, stage length and load factors will remain constant, (4) that each carrier's operational performance will remain at recent historic levels and (5) an annual projected inflation rate. These amounts exclude certain variable pass-through costs such as fuel and landing fees, among others. Based on these assumptions as of December 31, 2025, our estimated future payments through the end of the terms of our CPAs are presented in the table below (in billions):\n\n20262027202820292030After 2030Total\n\nFuture commitments under CPAs$2.9 $2.9 $2.8 $2.3 $1.9 $6.2 $18.9 \n\nAs of December 31, 2025, United had 194 call options to purchase regional jet aircraft being operated by certain of its regional carriers with contract dates extending until 2037. These call options are exercisable upon wrongful termination or breach of contract, among other conditions.\n\nLegal and Environmental. The Company has certain contingencies resulting from litigation and claims incident to the ordinary course of business. The Company records liabilities for legal and environmental claims when it is probable that a loss has been incurred and the amount is reasonably estimable. These amounts are recorded based on the Company's assessments of the\n\n90\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nlikelihood of their eventual disposition. As of December 31, 2025, management believes, after considering a number of factors, including (but not limited to) the information currently available, the views of legal counsel, the nature of contingencies to which the Company is subject and prior experience, that its defenses and assertions in pending legal proceedings have merit and the ultimate disposition of any pending matter will not materially affect the Company's financial position, results of operations or cash flows, except as described below.\n\nDispute with Rolls-Royce\n\nIn 2010, the Company entered into agreements with Rolls-Royce for engine purchases and related maintenance services for certain widebody aircraft. In 2017, the Company paid Rolls-Royce a $175 million commitment payment under those agreements. In December 2025, following a breach by Rolls-Royce, the Company issued a demand for payment representing the commitment payment plus contractual escalation. Rolls-Royce did not make the demanded payment. Rolls-Royce subsequently terminated the referenced agreements with the Company and asserted that the Company breached the agreements. The Company has disputed that Rolls-Royce properly terminated the agreements. Each of the parties contends that the other owes it damages.\n\nThe Company has taken steps to recover the amounts it believes Rolls-Royce owes the Company, along with other damages to which the Company believes it is entitled. No assurance can be given that the Company will recover the funds it believes it is owed, or to the ultimate outcome of this matter. The Company is also considering further implications of this dispute with respect to other parties. At this time, the Company has determined that a loss is neither probable nor reasonably estimable due to the preliminary nature of this matter. Additionally, the Company has not recognized any gains for this matter as of December 31, 2025. To the extent to which such amounts are determined to be realizable in the future, those gains would be recorded in the period such determination is made.\n\nGuarantees and Indemnifications. In the normal course of business, the Company enters into numerous real estate leasing and aircraft financing arrangements that have various guarantees included in the contracts. These guarantees are primarily in the form of indemnities under which the Company typically indemnifies the lessors and any tax/financing parties against liabilities that arise out of or relate to the use, operation or maintenance of the leased premises or financed aircraft. Currently, the Company believes that any future payments required under these guarantees or indemnities would be immaterial, as most liabilities and related indemnities are covered by insurance (subject to deductibles). Additionally, certain real estate leases include indemnities for any environmental liability that may arise out of or relate to the use of the leased premises.\n\nAs of December 31, 2025, United is the guarantor of approximately $2.8 billion in aggregate principal amount of tax-exempt special facility revenue bonds and interest thereon. These bonds, which in most instances are issued by various airport municipalities, are payable solely from rentals paid under long-term agreements with the respective governing bodies. The leasing arrangements associated with these obligations are accounted for as operating leases and the related obligations are included in our lease related disclosures in Note 11. All of these bonds mature between 2026 and 2041.\n\nAs of December 31, 2025, United had $395 million of surety bonds securing various insurance-related obligations with expiration dates through 2029.\n\nIncreased Cost Provisions. In United's financing transactions that include loans in which United is the borrower, United typically agrees to reimburse lenders for any reduced returns with respect to the loans due to any change in capital requirements and, in the case of loans with respect to which the interest rate is based on SOFR, for certain other increased costs that the lenders incur in carrying these loans as a result of any change in law, subject, in most cases, to obligations of the lenders to take certain limited steps to mitigate the requirement for, or the amount of, such increased costs. At December 31, 2025, the Company had $8.6 billion of floating rate debt with remaining terms of up to approximately 12 years that are subject to these increased cost provisions. In several financing transactions with remaining terms of up to approximately 12 years and an aggregate balance of $5.4 billion, the Company bears the risk of any change in tax laws that would subject loan payments thereunder to withholding taxes, subject to customary exclusions.\n\nFuel Consortia. United participates in numerous fuel consortia with other air carriers at major airports to reduce the costs of fuel distribution and storage. Interline agreements govern the rights and responsibilities of the consortia members and provide for the allocation of the overall costs to operate the consortia based on usage. The consortia (and in limited cases, the participating carriers) have entered into long-term agreements to lease certain airport fuel storage and distribution facilities that are typically financed through various debt obligations. In general, each consortium lease agreement requires the consortium to make lease payments in amounts sufficient to pay the maturing principal and interest payments on these debt obligations. As of December 31, 2025, approximately $2.9 billion principal amount of such loans was secured by significant fuel facility leases in which United participates, as to which United and each of the signatory airlines has provided indirect guarantees of the debt. As of December 31, 2025, the Company's contingent exposure was approximately $513 million principal amount of such obligations based on its recent consortia participation. The Company's contingent exposure could increase if the participation of\n\n91\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)\n\nother air carriers decreases. The guarantees will expire when these obligations are paid in full, which ranges from 2027 to 2056. The Company concluded it was not necessary to record a liability for these indirect guarantees.\n\nCredit Card Processing Agreements. The Company has agreements with financial institutions that process customer credit card transactions for the sale of air travel and other services. Under certain of the Company's credit card processing agreements, the financial institutions in certain circumstances have the right to require that the Company maintain a reserve equal to a portion of advance ticket sales that has been processed by that financial institution, but for which the Company has not yet provided the air transportation. Such financial institutions may require additional cash or other collateral reserves to be established or additional withholding of payments related to receivables collected if the Company does not maintain certain minimum levels of unrestricted cash, cash equivalents and short-term investments (collectively, \"Unrestricted Liquidity\"). The Company's current level of Unrestricted Liquidity is substantially in excess of these minimum levels.\n\nLabor Negotiations. As of December 31, 2025, United, including its subsidiaries, had approximately 113,200 employees. Approximately 83% of United's employees were represented by various U.S. labor organizations.\n\nIn May 2025, the Company reached a Tentative Agreement (\"TA\") with its employees represented by the Association of Flight Attendants (\"AFA\") regarding an agreement that became amendable in August 2021. The TA included improvements with respect to scheduling, reserve requirements and other quality of life improvements, as well as pay rate increases during its five-year term. The TA also included a provision for a one-time payment to employees represented by the AFA upon ratification. In the second quarter of 2025, the Company recorded, in Special charges, $561 million of expenses related to this ratification payment. On July 29, 2025, the Company's employees represented by the AFA voted against ratification of the TA. As of the date of this report, the Company and the AFA continue their negotiations for a revised TA.\n\nNOTE 13 - SPECIAL CHARGES (CREDITS)\n\nFor the years ended December 31, operating and nonoperating special charges (credits) and unrealized (gains) losses on investments in the statements of consolidated operations consisted of the following (in millions):\n\n202520242023\n\nLabor contract ratification bonuses$561 $— $814 \n\n(Gains) losses on sale of assets and other special charges(303)112 135 \n\nTotal operating special charges259 112 949 \n\nNonoperating unrealized (gains) losses on investments, net(4)199 (27)\n\nNonoperating debt extinguishment and modification fees20 128 11 \n\nTotal nonoperating special charges and unrealized (gains) losses on investments, net16 327 (16)\n\nTotal operating and nonoperating special charges and unrealized (gains) losses on investments, net274 439 933 \n\nIncome tax benefit, net of valuation allowance(136)(54)(214)\n\nTotal operating and nonoperating special charges and unrealized (gains) losses on investments, net of income taxes$138 $385 $719 \n\nOperating and nonoperating special charges (credits) and unrealized (gains) losses on investments included the following:\n\nDuring 2025, the Company recorded a $561 million special charge in connection with a proposed labor contract ratification payment for the Company's employees represented by the AFA. See Note 12 for more information related to this labor contract.\n\nDuring 2025, the Company recorded $303 million of net gains on sale of assets and other special charges, which were primarily comprised of $427 million of gains on various aircraft sale-leaseback transactions, partially offset by $125 million in other charges mainly consisting of certain one-time expenses related to the Three Party Agreement in connection with the merger between Mesa and Legacy Republic and write-offs related to various cancelled projects.\n\nDuring 2025, the Company recorded $20 million of charges related to the prepayment in full of the outstanding principal balance of the MileagePlus senior secured notes in July 2025. See Note 10 for more information related to this prepayment.\n\nDuring 2024, the Company recorded $128 million of charges related to the prepayment in full of the outstanding principal balance of the MileagePlus Term Loan in July 2024, the refinancing of its 2021 term loans in February 2024 and a partial prepayment of the 2024 Term Loans.\n\n92\n\n[Table of Contents](#i58162399576e4fb8b3894b993dca610a_7)"}