Skywest (SKYW) risk factors, FY2024 10-K

Other

1. 01We may experience disruption in service due to delays from key third-party aircraft maintenance service providers
2. 02We have experienced, and may continue to experience, difficulty in retaining and upgrading qualified pilots
3. 03We have experienced, and may continue to experience, difficulty recruiting and retaining other operational personnel
4. 04Various negative economic or industry conditions may result in reductions to our flight schedules, which could materially and adversely affect our operations and financial condition
5. 05Cybersecurity incidents, hardware or software failures or other information technology disruptions may negatively impact our operations, reputation and financial condition
6. 06Interruptions or disruptions in service at one of our hub airports, due to weather, system malfunctions or for any other reason, could have a material adverse impact on our operations
7. 07The occurrence of an aviation accident involving our aircraft would negatively impact our operations and financial condition
8. 08We are subject to significant governmental regulation and potential regulatory changes
9. 09Changes to U.S. tariff and import/export regulations may have a negative effect on our suppliers and/or service providers and, in turn, could have a material adverse impact on our financial condition
10. 10Compliance, or failure to comply, with new or existing laws, regulations and other requirements relating to the privacy, security and handling of information about individuals could adversely affect our business, results of operations, or financial condition
11. 11Terrorist activities or warnings have dramatically impacted the airline industry and will likely continue to do so

Risks Related to Our Code-Share Agreements with Our Major Airline Partners

1. 12Our business model is dependent on code-share agreements with four major airline partners
2. 13Reduced utilization levels of our aircraft under our capacity purchase agreements with our major airline partners would have a material adverse impact on the results of our operations and financial condition
3. 14Our major airline partners may experience events that negatively impact their financial strength or operations, which may also negatively impact our operations
4. 15Our growth may be limited with our major airline partners' flight systems
5. 16There are long-term risks related to supply and demand of regional aircraft associated with our regional airline services strategy
6. 17Revenue levels from our prorate agreements with our major airline partners may not continue to increase and are terminable upon notice of 120 days or less. Additionally, revenue levels from our SWC operation may not continue to increase
7. 18Disagreements regarding the interpretation of our code-share agreements with our major airline partners could have an adverse effect on our operating results and financial condition
8. 19We operate on-demand charter flights through our wholly-owned subsidiary, SWC, and such operations involve significant risk
9. 20The airline industry is highly competitive, which could adversely affect our operating results and financial condition

Risks Related to Our Operating Costs and Personnel

1. 21Increases in labor costs, including pilot costs, flight attendant costs, maintenance costs and overhead costs may result in lower operating margins under our capacity purchase agreements
2. 22Increased labor costs, pilot and other labor availability, labor disputes and unionization of our workforces may adversely affect our ability to conduct our business and reduce our profitability
3. 23We may experience an increase in fuel prices in our prorate and SWC operations
4. 24Our business could be harmed if we lose the services of our key personnel
5. 25We may experience credit losses in excess of our estimated credit loss reserves
6. 26We have guaranteed the indebtedness of third parties that may default on their debt and require us to pay

Risks Related to Operating and Leasing Regional Jet Aircraft and Engines

1. 27We are reliant on two aircraft manufacturers and one engine manufacturer
2. 28We have a significant amount of contractual long-term debt obligations
3. 29As of December 31, 2024, we have firm purchase commitments for 16 E175 aircraft and spare engines totaling $481.5 million. Over the next several years, if we continue to add new aircraft to our fleet, we anticipate using significant amounts of capital to acquire these aircraft
4. 30The residual value of our owned aircraft may be less than estimated in our depreciation policies
5. 31We lease aircraft and engines to third parties and the lessee may default under the lease terms, which could negatively affect our financial condition, cash flow and results of operations
6. 32We have entered into a strategic engine leasing joint venture that operates under joint control with a third party that involves significant risk
7. 33We entered into a partnership with a third party to develop demand for electric-powered aircraft that involves significant uncertainty and risk
8. 34The effect of any, or some combination, of the foregoing risks could affect our partnership with Eve and future benefits may not materialize
9. 35We have invested in Contour, which involves significant risk and may not produce a satisfactory return on our investment
10. 36We are subject to various environmental requirements, including laws and regulations related to climate change and emissions. Compliance with new or existing environmental requirements could materially and adversely affect the Company's business plans, strategies and results of operations

Risks Related to Dividends, Share Repurchases and Our Common Stock

1. 37We cannot assure that we will resume dividend payments in the future and we cannot assure that we will continue stock repurchases in the future
2. 38Our common stock price may fluctuate significantly
3. 39Provisions of our articles of incorporation, by-laws and code-share agreements may limit the ability or desire of others to gain control of our Company
4. 40We may be a party to litigation in the normal course of business or otherwise, which could affect our financial condition and results of operations
5. 41The adoption of new tax legislation or changes to existing tax laws and regulations could adversely affect our financial condition or results of operations