Item 1. FINANCIAL STATEMENTS.

UNITED AIRLINES HOLDINGS, INC.

STATEMENTS OF CONSOLIDATED OPERATIONS (UNAUDITED)

(In millions, except per share amounts)

			Three Months Ended September 30,												Nine Months Ended September 30,
			2023						2022						2023						2022
Operating revenue:
Passenger revenue			$	13,349					$	11,653					$	36,625					$	28,830
Cargo			333						498						1,093						1,699
Other operating revenue			802						726						2,373						2,026
Total operating revenue			14,484						12,877						40,091						32,555
Operating expense:
Salaries and related costs			3,914						2,843						10,946						8,466
Aircraft fuel			3,342						3,755						9,336						9,796
Landing fees and other rent			801						639						2,283						1,919
Aircraft maintenance materials and outside repairs			684						619						2,072						1,553
Depreciation and amortization			663						610						1,987						1,832
Regional capacity purchase			592						596						1,806						1,728
Distribution expenses			516						482						1,406						1,101
Aircraft rent			46						65						151						193
Special charges			29						20						902						124
Other operating expenses			2,158						1,790						5,989						4,883
Total operating expense			12,745						11,419						36,878						31,595
Operating income			1,739						1,458						3,213						960
Nonoperating income (expense):
Interest expense			(493)						(455)						(1,472)						(1,299)
Interest income			234						104						620						142
Interest capitalized			48						27						128						73
Unrealized gains (losses) on investments, net			(54)						28						54						(12)
Miscellaneous, net			11						(9)						73						(4)
Total nonoperating expense, net			(254)						(305)						(597)						(1,100)
Income (loss) before income tax expense (benefit)			1,485						1,153						2,616						(140)
Income tax expense (benefit)			348						211						598						(34)
Net income (loss)			$	1,137					$	942					$	2,018					$	(106)
Earnings (loss) per share, basic			$	3.47					$	2.88					$	6.16					$	(0.33)
Earnings (loss) per share, diluted			$	3.42					$	2.86					$	6.08					$	(0.33)

The accompanying Combined Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED AIRLINES HOLDINGS, INC.

STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME (LOSS) (UNAUDITED)

(In millions)

			Three Months Ended September 30,												Nine Months Ended September 30,
			2023						2022						2023						2022
Net income (loss)			$	1,137					$	942					$	2,018					$	(106)
Other comprehensive income (loss), net of tax:
Employee benefit plans			(20)						—						(89)						9
Investments and other			8						(20)						5						(31)
Total other comprehensive loss, net of tax			(12)						(20)						(84)						(22)
Total comprehensive income (loss), net			$	1,125					$	922					$	1,934					$	(128)

The accompanying Combined Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED AIRLINES HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In millions, except shares)

			September 30, 2023						December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents			$	7,478					$	7,166
Short-term investments			9,608						9,248
Restricted cash			392						45
Receivables, less allowance for credit losses (2023 — $14; 2022 — $11)			2,193						1,801
Aircraft fuel, spare parts and supplies, less obsolescence allowance (2023 — $665; 2022 — $610)			1,513						1,109
Prepaid expenses and other			728						689
Total current assets			21,912						20,058
Operating property and equipment:
Flight equipment			46,938						42,775
Other property and equipment			10,157						9,334
Purchase deposits for flight equipment			3,379						2,820
Total operating property and equipment			60,474						54,929
Less — Accumulated depreciation and amortization			(22,114)						(20,481)
Total operating property and equipment, net			38,360						34,448
Operating lease right-of-use assets			3,975						3,889
Other assets:
Goodwill			4,527						4,527
Intangibles, less accumulated amortization (2023 — $1,486; 2022 — $1,472)			2,735						2,762
Restricted cash			240						210
Deferred income taxes			—						91
Investments in affiliates and other, less allowance for credit losses (2023 — $27; 2022 — $21)			1,404						1,373
Total other assets			8,906						8,963
Total assets			$	73,153					$	67,358

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UNITED AIRLINES HOLDINGS, INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In millions, except shares)

			September 30, 2023						December 31, 2022
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable			$	4,206					$	3,395
Accrued salaries and benefits			3,815						1,971
Advance ticket sales			8,392						7,555
Frequent flyer deferred revenue			2,969						2,693
Current maturities of long-term debt			3,649						2,911
Current maturities of operating leases			598						561
Current maturities of finance leases			271						104
Current maturities of other financial liabilities			44						23
Other			812						779
Total current liabilities			24,756						19,992
Long-term debt			25,932						28,283
Long-term obligations under operating leases			4,493						4,459
Long-term obligations under finance leases			71						115
Other liabilities and deferred credits:
Frequent flyer deferred revenue			4,107						3,982
Pension liability			800						747
Postretirement benefit liability			621						671
Deferred income taxes			472						—
Other financial liabilities			1,648						844
Other			1,400						1,369
Total other liabilities and deferred credits			9,048						7,613
Commitments and contingencies
Stockholders' equity:
Preferred stock			—						—
Common stock at par, $0.01 par value; authorized 1,000,000,000 shares; outstanding 328,013,283 and 326,930,321 shares at September 30, 2023 and December 31, 2022, respectively			4						4
Additional capital invested			8,968						8,986
Stock held in treasury, at cost			(3,442)						(3,534)
Retained earnings			3,232						1,265
Accumulated other comprehensive income			91						175
Total stockholders' equity			8,853						6,896
Total liabilities and stockholders' equity			$	73,153					$	67,358

The accompanying Combined Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED AIRLINES HOLDINGS, INC.

CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED)

(In millions)

			Nine Months Ended September 30,
			2023						2022
Cash Flows from Operating Activities:
Net cash provided by operating activities			$	7,821					$	4,908
Cash Flows from Investing Activities:
Capital expenditures, net of flight equipment purchase deposit returns			(5,105)						(2,280)
Purchases of short-term and other investments			(8,875)						(8,384)
Proceeds from sale of short-term and other investments			8,614						1,061
Proceeds from sale of property and equipment			20						184
Other, net			(17)						(23)
Net cash used in investing activities			(5,363)						(9,442)
Cash Flows from Financing Activities:
Proceeds from issuance of debt and other financing liabilities, net of discounts and fees			1,685						210
Payments of long-term debt, finance leases and other financing liabilities			(3,423)						(2,605)
Other, net			(31)						(77)
Net cash used in financing activities			(1,769)						(2,472)
Net increase (decrease) in cash, cash equivalents and restricted cash			689						(7,006)
Cash, cash equivalents and restricted cash at beginning of the period			7,421						18,533
Cash, cash equivalents and restricted cash at end of the period (a)			$	8,110					$	11,527
Investing and Financing Activities Not Affecting Cash:
Property and equipment acquired through the issuance of debt, finance leases and other			$	677					$	—
Right-of-use assets acquired through operating leases			470						98
Lease modifications and lease conversions			438						61
Investment interests received in exchange for goods and services			25						93

(a) The following table provides a reconciliation of cash, cash equivalents and restricted cash to amounts reported within the consolidated balance sheet:

Current assets:
Cash and cash equivalents			$	7,478					$	11,258
Restricted cash — Current			392						61
Restricted cash — Non-Current			240						208
Total cash, cash equivalents and restricted cash			$	8,110					$	11,527

The accompanying Combined Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED AIRLINES HOLDINGS, INC.

STATEMENTS OF CONSOLIDATED STOCKHOLDERS' EQUITY (UNAUDITED)

(In millions)

			Common Stock												Additional Capital Invested						Treasury Stock						Retained Earnings (Accumulated Deficit)						Accumulated Other Comprehensive Income (Loss)						Total
			Shares						Amount
Balance at June 30, 2023			328.0						$	4					$	8,945					$	(3,442)					$	2,095					$	103					$	7,705
Net income			—						—						—						—						1,137						—						1,137
Other comprehensive loss			—						—						—						—						—						(12)						(12)
Stock-settled share-based compensation			—						—						23						—						—						—						23
Balance at September 30, 2023			328.0						$	4					$	8,968					$	(3,442)					$	3,232					$	91					$	8,853
Balance at December 31, 2022			326.9						$	4					$	8,986					$	(3,534)					$	1,265					$	175					$	6,896
Net income			—						—						—						—						2,018						—						2,018
Other comprehensive loss			—						—						—						—						—						(84)						(84)
Stock-settled share-based compensation			—						—						55						—						—						—						55
Stock issued for share-based awards, net of shares withheld for tax			1.1						—						(73)						92						(51)						—						(32)
Balance at September 30, 2023			328.0						$	4					$	8,968					$	(3,442)					$	3,232					$	91					$	8,853
Balance at June 30, 2022			326.7						$	4					$	8,970					$	(3,551)					$	(515)					$	(944)					$	3,964
Net income			—						—						—						—						942						—						942
Other comprehensive loss			—						—						—						—						—						(20)						(20)
Stock-settled share-based compensation			—						—						15						—						—						—						15
Stock issued for share-based awards, net of shares withheld for tax			0.2						—						(15)						18						(6)						—						(3)
Balance at September 30, 2022			326.9						$	4					$	8,970					$	(3,533)					$	421					$	(964)					$	4,898
Balance at December 31, 2021			323.8						$	4					$	9,156					$	(3,814)					$	625					$	(942)					$	5,029
Net loss			—						—						—						—						(106)						—						(106)
Other comprehensive loss			—						—						—						—						—						(22)						(22)
Stock-settled share-based compensation			—						—						70						—						—						—						70
Stock issued for share-based awards, net of shares withheld for tax			3.1						—						(256)						281						(98)						—						(73)
Balance at September 30, 2022			326.9						$	4					$	8,970					$	(3,533)					$	421					$	(964)					$	4,898

The accompanying Combined Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED AIRLINES, INC.

STATEMENTS OF CONSOLIDATED OPERATIONS (UNAUDITED)

(In millions)

			Three Months Ended September 30,												Nine Months Ended September 30,
			2023						2022						2023						2022
Operating revenue:
Passenger revenue			$	13,349					$	11,653					$	36,625					$	28,830
Cargo			333						498						1,093						1,699
Other operating revenue			802						726						2,373						2,026
Total operating revenue			14,484						12,877						40,091						32,555
Operating expense:
Salaries and related costs			3,914						2,843						10,946						8,466
Aircraft fuel			3,342						3,755						9,336						9,796
Landing fees and other rent			801						639						2,283						1,919
Aircraft maintenance materials and outside repairs			684						619						2,072						1,553
Depreciation and amortization			663						610						1,987						1,832
Regional capacity purchase			592						596						1,806						1,728
Distribution expenses			516						482						1,406						1,101
Aircraft rent			46						65						151						193
Special charges			29						20						902						124
Other operating expenses			2,158						1,789						5,988						4,881
Total operating expense			12,745						11,418						36,877						31,593
Operating income			1,739						1,459						3,214						962
Nonoperating income (expense):
Interest expense			(493)						(455)						(1,472)						(1,299)
Interest income			234						104						620						142
Interest capitalized			48						27						128						73
Unrealized gains (losses) on investments, net			(54)						28						54						(12)
Miscellaneous, net			12						(9)						74						(4)
Total nonoperating expense, net			(253)						(305)						(596)						(1,100)
Income (loss) before income tax expense (benefit)			1,486						1,154						2,618						(138)
Income tax expense (benefit)			348						212						599						(33)
Net income (loss)			$	1,138					$	942					$	2,019					$	(105)

The accompanying Combined Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED AIRLINES, INC.

STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME (LOSS) (UNAUDITED)

(In millions)

			Three Months Ended September 30,												Nine Months Ended September 30,
			2023						2022						2023						2022
Net income (loss)			$	1,138					$	942					$	2,019					$	(105)
Other comprehensive income (loss), net of tax:
Employee benefit plans			(20)						0						(89)						9
Investments and other			8						(20)						5						(31)
Total other comprehensive loss, net of tax			(12)						(20)						(84)						(22)
Total comprehensive income (loss), net			$	1,126					$	922					$	1,935					$	(127)

The accompanying Combined Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED AIRLINES, INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In millions, except shares)

			September 30, 2023						December 31, 2022
ASSETS
Current assets:
Cash and cash equivalents			$	7,478					$	7,166
Short-term investments			9,608						9,248
Restricted cash			392						45
Receivables, less allowance for credit losses (2023 — $14; 2022 — $11)			2,193						1,801
Aircraft fuel, spare parts and supplies, less obsolescence allowance (2023 — $665; 2022 — $610)			1,513						1,109
Prepaid expenses and other			728						689
Total current assets			21,912						20,058
Operating property and equipment:
Flight equipment			46,938						42,775
Other property and equipment			10,157						9,334
Purchase deposits for flight equipment			3,379						2,820
Total operating property and equipment			60,474						54,929
Less — Accumulated depreciation and amortization			(22,114)						(20,481)
Total operating property and equipment, net			38,360						34,448
Operating lease right-of-use assets			3,975						3,889
Other assets:
Goodwill			4,527						4,527
Intangibles, less accumulated amortization (2023 — $1,486; 2022 — $1,472)			2,735						2,762
Restricted cash			240						210
Deferred income taxes			—						62
Investments in affiliates and other, less allowance for credit losses (2023 — $27; 2022 —$21)			1,404						1,373
Total other assets			8,906						8,934
Total assets			$	73,153					$	67,329

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UNITED AIRLINES, INC.

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(In millions, except shares)

			September 30, 2023						December 31, 2022
LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities:
Accounts payable			$	4,206					$	3,395
Accrued salaries and benefits			3,815						1,971
Advance ticket sales			8,392						7,555
Frequent flyer deferred revenue			2,969						2,693
Current maturities of long-term debt			3,649						2,911
Current maturities of operating leases			598						561
Current maturities of finance leases			271						104
Current maturities of other financial liabilities			44						23
Other			814						781
Total current liabilities			24,758						19,994
Long-term debt			25,932						28,283
Long-term obligations under operating leases			4,493						4,459
Long-term obligations under finance leases			71						115
Other liabilities and deferred credits:
Frequent flyer deferred revenue			4,107						3,982
Pension liability			800						747
Postretirement benefit liability			621						671
Deferred income taxes			500						—
Other financial liabilities			1,648						844
Other			1,400						1,369
Total other liabilities and deferred credits			9,076						7,613
Commitments and contingencies
Stockholder's equity:
Common stock at par, $0.01 par value; authorized 1,000 shares; issued and outstanding 1,000 shares at both September 30, 2023 and December 31, 2022			—						—
Additional capital invested			458						403
Retained earnings			5,735						3,716
Accumulated other comprehensive income			91						175
Payable to parent			2,539						2,571
Total stockholder's equity			8,823						6,865
Total liabilities and stockholder's equity			$	73,153					$	67,329

The accompanying Combined Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED AIRLINES, INC.

CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED)

(In millions)

			Nine Months Ended September 30,
			2023						2022
Cash Flows from Operating Activities:
Net cash provided by operating activities			$	7,790					$	4,834
Cash Flows from Investing Activities:
Capital expenditures, net of flight equipment purchase deposit returns			(5,105)						(2,280)
Purchases of short-term and other investments			(8,875)						(8,384)
Proceeds from sale of short-term and other investments			8,614						1,061
Proceeds from sale of property and equipment			20						184
Other, net			(17)						(23)
Net cash used in investing activities			(5,363)						(9,442)
Cash Flows from Financing Activities:
Proceeds from issuance of debt and other financing liabilities, net of discounts and fees			1,685						210
Payments of long-term debt, finance leases and other financing liabilities			(3,423)						(2,605)
Other, net			—						(3)
Net cash used in financing activities			(1,738)						(2,398)
Net increase (decrease) in cash, cash equivalents and restricted cash			689						(7,006)
Cash, cash equivalents and restricted cash at beginning of the period			7,421						18,533
Cash, cash equivalents and restricted cash at end of the period (a)			$	8,110					$	11,527
Investing and Financing Activities Not Affecting Cash:
Property and equipment acquired through the issuance of debt, finance leases and other			$	677					$	—
Right-of-use assets acquired through operating leases			470						98
Lease modifications and lease conversions			438						61
Investment interests received in exchange for goods and services			25						93

(a) The following table provides a reconciliation of cash, cash equivalents and restricted cash to amounts reported within the consolidated balance sheet:

Current assets:
Cash and cash equivalents			$	7,478					$	11,258
Restricted cash — Current			392						61
Restricted cash — Non-Current			240						208
Total cash, cash equivalents and restricted cash			$	8,110					$	11,527

The accompanying Combined Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED AIRLINES, INC.

STATEMENTS OF CONSOLIDATED STOCKHOLDER'S EQUITY (UNAUDITED)

(In millions)

			Additional Capital Invested						Retained Earnings						Accumulated Other Comprehensive Income (Loss)						Payable to Parent						Total
Balance at June 30, 2023			$	435					$	4,597					$	103					$	2,539					$	7,674
Net income			—						1,138						—						—						1,138
Other comprehensive loss			—						—						(12)						—						(12)
Stock-settled share-based compensation			23						—						—						—						23
Balance at September 30, 2023			$	458					$	5,735					$	91					$	2,539					$	8,823
Balance at December 31, 2022			$	403					$	3,716					$	175					$	2,571					$	6,865
Net income			—						2,019						—						—						2,019
Other comprehensive loss			—						—						(84)						—						(84)
Stock-settled share-based compensation			55						—						—						—						55
Other			—						—						—						(32)						(32)
Balance at September 30, 2023			$	458					$	5,735					$	91					$	2,539					$	8,823
Balance at June 30, 2022			$	373					$	1,930					$	(944)					$	2,574					$	3,933
Net income			—						942						—						—						942
Other comprehensive loss			—						—						(20)						—						(20)
Stock-settled share-based compensation			14						—						—						—						14
Other			—						—						—						(3)						(3)
Balance at September 30, 2022			$	387					$	2,872					$	(964)					$	2,571					$	4,866
Balance at December 31, 2021			$	317					$	2,977					$	(942)					$	2,646					$	4,998
Net loss			—						(105)						—						—						(105)
Other comprehensive loss			—						—						(22)						—						(22)
Stock-settled share-based compensation			70						—						—						—						70
Other			—						—						—						(75)						(75)
Balance at September 30, 2022			$	387					$	2,872					$	(964)					$	2,571					$	4,866

The accompanying Combined Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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UNITED AIRLINES HOLDINGS, INC. AND UNITED AIRLINES, INC.

COMBINED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

United Airlines Holdings, Inc. (together with its consolidated subsidiaries, "UAL" or the "Company") is a holding company and its wholly-owned subsidiary is United Airlines, Inc. (together with its consolidated subsidiaries, "United"). This Quarterly Report on Form 10-Q is a combined report of UAL and United, including their respective consolidated financial statements. As UAL consolidates United for financial statement purposes, disclosures that relate to activities of United also apply to UAL, unless otherwise noted. United's operating revenues and operating expenses comprise nearly 100% of UAL's revenues and operating expenses. In addition, United comprises approximately the entire balance of UAL's 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. We sometimes use the words "we," "our," "us," and the "Company" in this report for disclosures that relate to all of UAL and United.

The UAL and United unaudited condensed consolidated financial statements shown here have been prepared as required by the U.S. Securities and Exchange Commission (the "SEC"). Some information and footnote disclosures normally included in financial statements that comply with accounting principles generally accepted in the United States ("GAAP") have been condensed or omitted as permitted by the SEC. The financial statements include all adjustments, including normal recurring adjustments and other adjustments, which are considered necessary for a fair presentation of the Company's financial position and results of operations for interim periods presented. The UAL and United financial statements should be read together with the information included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2022. The Company's quarterly financial data is subject to seasonal fluctuations. Historically its second and third quarter financial results have reflected higher travel demand, and were better than its first and fourth quarter financial results.

NOTE 1 — REVENUE

Revenue by Geography. The table below presents the Company's operating revenue by principal geographic region (as defined by the U.S. Department of Transportation) (in millions):

			Three Months Ended September 30,												Nine Months Ended September 30,
			2023						2022						2023						2022
Domestic (U.S. and Canada)			$	8,379					$	7,718					$	23,963					$	20,623
Atlantic			3,543						3,186						8,604						6,756
Latin America			1,184						1,162						3,773						3,266
Pacific			1,378						811						3,751						1,910
Total			$	14,484					$	12,877					$	40,091					$	32,555

Advance Ticket Sales. The Company defers amounts related to future travel in its Advance ticket sales liability account. All tickets sold at any given point in time have travel dates through the next 12 months. The Company's Advance ticket sales liability also includes credits issued to customers for future flights ("FFCs") and electronic travel certificates ("ETCs"), primarily for ticket cancellations, which can be applied towards a purchase of a new ticket. FFCs and ETCs are valid up to one year from the date of issuance; however, all credits issued on or before December 31, 2022 have been extended to December 31, 2023.

The Company estimates the value of Advance ticket sales that will expire unused ("breakage") and recognizes revenue in proportion to the usage of the related tickets. To determine breakage, the Company uses its historical experience with expired tickets and certificates and other facts, such as recent aging trends, program changes and modifications that could affect the ultimate expiration patterns. Changes in our estimates of FFCs and ETCs that may expire unused could have a material impact on revenue. Changes in estimates of breakage are recognized prospectively in proportion to the remaining usage of the related tickets.

In the nine months ended September 30, 2023 and 2022, the Company recognized approximately $5.3 billion and $3.0 billion, respectively, of passenger revenue for tickets that were included in Advance ticket sales at the beginning of those periods.

Ancillary Fees. The Company charges fees, separately from ticket sales, for certain ancillary services that are directly related to passengers' 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 $1.1 billion and $3.0 billion of ancillary fees within passenger revenue in the three and nine months ended

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September 30, 2023, respectively. The Company recorded $0.9 billion and $2.4 billion of ancillary fees within passenger revenue in the three and nine months ended September 30, 2022, respectively.

Frequent Flyer Accounting. The table below presents a roll forward of Frequent flyer deferred revenue (in millions):

			Three Months Ended September 30,												Nine Months Ended September 30,
			2023						2022						2023						2022
Total Frequent flyer deferred revenue - beginning balance			$	7,024					$	6,495					$	6,675					$	6,282
Total miles awarded			816						705						2,465						1,848
Travel miles redeemed			(740)						(601)						(1,983)						(1,489)
Non-travel miles redeemed			(24)						(21)						(81)						(63)
Total Frequent flyer deferred revenue - ending balance			$	7,076					$	6,578					$	7,076					$	6,578

In the three and nine months ended September 30, 2023, the Company recognized, in Other operating revenue, $0.7 billion and $2.0 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 JPMorgan Chase Bank, N.A. MileagePlus co-brand agreement. The Company recognized $0.6 billion and $1.7 billion, respectively, in the three and nine months ended September 30, 2022, related to those agreements. The portion related to the MileagePlus miles awarded of the total amounts received from our various partner agreements is deferred and presented in the table above as an increase to the Frequent flyer deferred revenue. We determine the current portion of that account based on expected redemptions in the next 12 months.

NOTE 2 — EARNINGS (LOSS) PER SHARE

The computations of UAL's basic and diluted earnings (loss) per share are set forth below (in millions, except per share amounts):

			Three Months Ended September 30,												Nine Months Ended September 30,
			2023						2022						2023						2022
Earnings (loss) available to common stockholders			$	1,137					$	942					$	2,018					$	(106)
Basic weighted-average shares outstanding			328.0						326.8						327.8						326.2
Dilutive effect of stock warrants (a)			2.7						1.0						2.5						—
Dilutive effect of employee stock awards			1.7						1.7						1.5						—
Diluted weighted-average shares outstanding			332.4						329.5						331.8						326.2
Earnings (loss) per share, basic			$	3.47					$	2.88					$	6.16					$	(0.33)
Earnings (loss) per share, diluted			$	3.42					$	2.86					$	6.08					$	(0.33)
Potentially dilutive securities (b)
Stock warrants (a)			1.5						3.5						1.5						3.5
Employee stock awards			0.6						0.7						0.6						0.7
(a) Represent warrants issued to the U.S. Treasury Department ("Treasury") pursuant to the payroll support program, including extensions, and the loan program established under the Coronavirus Aid, Relief, and Economic Security Act. The Company issued, to Treasury, warrants to purchase up to approximately 10 million shares of UAL common stock at exercise prices ranging from $31.50 to $53.92 and expiration dates ranging from April 20, 2025 to June 10, 2026. All warrants were outstanding as of September 30, 2023.
(b) Weighted-average potentially dilutive securities outstanding excluded from the computation of diluted earnings per share because the securities would have had an antidilutive effect.

On March 3, 2021, the Company entered into an equity distribution agreement (the "Distribution Agreement") with several financial institutions (collectively, the "Managers"), relating to the issuance and sale from time to time by UAL (the "2021 ATM Offering"), through the Managers, of up to 37 million shares of UAL common stock (the "2021 ATM Shares"). Sales of the 2021 ATM Shares under the Distribution Agreement were allowed to be made in any transactions that were deemed to be "at the market offerings" as defined in Rule 415 under the Securities Act of 1933, as amended. During 2021, approximately

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4 million shares were sold in the 2021 ATM Offering at an average price of $57.50 per share, with net proceeds to the Company totaling approximately $250 million. No shares were sold in 2022 or 2023 under the 2021 ATM Offering, which expired in March 2023.

NOTE 3 — ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

The table below presents the components of the Company's accumulated other comprehensive income (loss), net of tax ("AOCI") (in millions):

						Pension and Other Postretirement Liabilities						Investments and Other						Deferred Taxes (a)						Total
Balance at June 30, 2023						$	539					$	(39)					$	(397)					$	103
Changes in value						7						10						(3)						14
Amounts reclassified to earnings						(33)			(b)			—						7						(26)
Balance at September 30, 2023						$	513					$	(29)					$	(393)					$	91
Balance at December 31, 2022						$	626					$	(35)					$	(416)					$	175
Changes in value						(10)						6						1						(3)
Amounts reclassified to earnings						(103)			(b)			—						22						(81)
Balance at September 30, 2023						$	513					$	(29)					$	(393)					$	91
Balance at June 30, 2022						$	(834)					$	(14)					$	(96)					$	(944)
Changes in value						(1)						(25)						6						(20)
Amounts reclassified to earnings						—			(b)			—						—						—
Balance at September 30, 2022						$	(835)					$	(39)					$	(90)					$	(964)
Balance at December 31, 2021						$	(847)					$	—					$	(95)					$	(942)
Changes in value						13						(39)						5						(21)
Amounts reclassified to earnings						(1)			(b)			—						—						(1)
Balance at September 30, 2022						$	(835)					$	(39)					$	(90)					$	(964)

(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.

(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 5 of this report for additional information).

NOTE 4 — INCOME TAXES

The Company's effective tax rates for the three and nine months ended September 30, 2023 were 23.4% and 22.9%, respectively. The Company's effective tax rates for the three and nine months ended September 30, 2022 were 18.3% and 24.3%, respectively. The provision for income taxes is based on the estimated annual effective tax rate, which represents a blend of federal, state and foreign taxes and includes the impact of certain nondeductible items.

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NOTE 5 — EMPLOYEE BENEFIT PLANS

Defined Benefit Pension and Other Postretirement Benefit Plans. The Company's net periodic benefit cost includes the following components for the three months ended September 30 (in millions):

						Pension Benefits												Other Postretirement Benefits												Affected Line Item in the Statements of Consolidated Operations
						2023						2022						2023						2022
Service cost						$	31					$	51					$	1					$	2					Salaries and related costs
Interest cost						53						47						10						8						Miscellaneous, net
Expected return on plan assets						(62)						(76)						—						—						Miscellaneous, net
Amortization of unrecognized (gain) loss						2						29						(9)						(3)						Miscellaneous, net
Amortization of prior service credit						1						—						(28)						(28)						Miscellaneous, net
Other						1						2						—						—						Miscellaneous, net
Total						$	26					$	53					$	(26)					$	(21)

The Company's net periodic benefit cost includes the following components for the nine months ended September 30 (in millions):

						Pension Benefits												Other Postretirement Benefits												Affected Line Item in the Statements of Consolidated Operations
						2023						2022						2023						2022
Service cost						$	93					$	153					$	3					$	6					Salaries and related costs
Interest cost						163						141						31						23						Miscellaneous, net
Expected return on plan assets						(188)						(230)						(1)						(1)						Miscellaneous, net
Amortization of unrecognized (gain) loss						6						90						(28)						(10)						Miscellaneous, net
Amortization of prior service credit						1						—						(84)						(84)						Miscellaneous, net
Other						2						3						—						—						Miscellaneous, net
Total						$	77					$	157					$	(79)					$	(66)

Profit Sharing. Substantially all employees participate in profit sharing based on a percentage of pre-tax earnings, excluding special or non-recurring charges, profit sharing expense and share-based compensation. Profit sharing percentages range from 5% to 20% depending on the work group, and in some cases profit sharing percentages vary above and below certain thresholds. As part of the new collective bargaining agreement with the Air Line Pilots Association ("ALPA"), the thresholds were lowered retroactive to January 1, 2023 for the pilot work group. Eligible U.S. co-workers in each participating work group receive a profit sharing payout using a formula based on the ratio of each qualified co-worker's annual eligible earnings to the eligible earnings of all qualified co-workers in all domestic work groups. Eligible non-U.S. co-workers receive profit sharing based on the calculation under the U.S. profit sharing plan for management and administrative employees. The Company recorded profit sharing and related payroll tax expense of $301 million and $521 million in the three and nine months ended September 30, 2023, respectively. The Company recorded profit sharing expense of $8 million in both the three and nine months ended September 30, 2022. Profit sharing expense is recorded as a component of Salaries and related costs in the Company's statements of consolidated operations.

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NOTE 6 — FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The table below presents disclosures about the financial assets and liabilities measured at fair value on a recurring basis in UAL's financial statements (in millions):

			September 30, 2023																								December 31, 2022
			Total						Level 1						Level 2						Level 3						Total						Level 1						Level 2						Level 3
Cash and cash equivalents			$	7,478					$	7,478					$	—					$	—					$	7,166					$	7,166					$	—					$	—
Restricted cash - current			392						392						—						—						45						45						—						—
Restricted cash - non-current			240						240						—						—						210						210						—						—
Short-term investments:
U.S. government and agency notes			9,506						—						9,506						—						8,914						—						8,914						—
Asset-backed securities			29						—						29						—						325						—						325						—
Certificates of deposit placed through an account registry service ("CDARS")			73						—						73						—						—						—						—						—
Corporate debt			—						—						—						—						9						—						9						—
Long-term investments:
Equity securities			163						163						—						—						189						189						—						—

Investments presented in the table above have the same fair value as their carrying value.

Restricted cash - current — Primarily includes amounts to be used for the payment of fees, principal and interest on senior secured notes and a secured term loan facility (the "MileagePlus Financing") secured by substantially all of the assets of Mileage Plus Holdings, LLC, a direct wholly-owned subsidiary of United.

Restricted cash - non-current — Primarily includes collateral associated with the MileagePlus Financing, collateral for letters of credit and collateral associated with facility leases and other insurance-related obligations.

Short-term investments — The short-term investments shown in the table above are classified as available-for-sale and have remaining maturities of approximately 18 months or less.

Long-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., Archer Aviation Inc., Eve Holding, Inc., Mesa Air Group, Inc. and Clear Secure, Inc.

Other fair value information. The table below presents the carrying values and estimated fair values of financial instruments not presented in the tables above (in millions). Carrying amounts include any related discounts, premiums and issuance costs:

			September 30, 2023																														December 31, 2022
			Carrying Amount						Fair Value																								Carrying Amount						Fair Value
									Total						Level 1						Level 2						Level 3												Total						Level 1						Level 2						Level 3
Long-term debt			$	29,581					$	28,386					$	—					$	22,726					$	5,660					$	31,194					$	29,371					$	—					$	23,990					$	5,381

Fair value of the financial instruments included in the tables above was determined as follows:

Description			Fair Value Methodology
Cash and cash equivalents and Restricted cash (current and non-current)			The carrying amounts of these assets approximate fair value.
Short-term and Long-term investments			Fair value is based on (a) the trading prices of the investment or similar instruments or (b) broker quotes obtained by third-party valuation services.
Long-term debt			Fair values were based on either market prices or the discounted amount of future cash flows using our current incremental rate of borrowing for similar liabilities or assets.

Equity Method Investments. As of September 30, 2023, United holds the following investments, accounted for using the equity method, with a combined carrying value of approximately $232 million:

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• CommuteAir LLC. United owns a 40% minority ownership stake in CommuteAir LLC. CommuteAir currently operates 53 regional aircraft under a capacity purchase agreement ("CPA") that has a term through 2026.

• Republic Airways Holdings Inc. United holds a 19% minority interest in Republic Airways Holdings Inc., which is the parent company of Republic Airways Inc. ("Republic"). Republic currently operates 66 regional aircraft under CPAs that have terms through 2036.

• United Airlines Ventures Sustainable Flight Fund (the "Fund"). During the first quarter of 2023, United launched, through its corporate venture capital arm, United Airlines Ventures ("UAV"), an investment vehicle designed to support start-ups focused on decarbonizing air travel by accelerating the research, production and technologies associated with sustainable aviation fuel ("SAF"). The Fund started with more than $100 million in commitments from United and other corporate investors, collectively, as limited partners. UAV transferred certain of its existing SAF investments to the Fund's portfolio. As of September 30, 2023, the Company indirectly holds a 38% ownership interest in the Fund and the Fund has approximately $200 million in commitments from United and other corporate investors.

Other Investments. As of September 30, 2023, 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 September 30, 2023, the carrying value of these investments was $425 million.

NOTE 7 — COMMITMENTS AND CONTINGENCIES

Commitments. As of September 30, 2023, United had firm commitments to purchase aircraft from The Boeing Company ("Boeing") and Airbus S.A.S. ("Airbus") as presented in the table below:

												Contractual Aircraft Deliveries																		Expected Aircraft Deliveries (b)
Aircraft Type						Number of Firm Commitments (a)						Last Three Months of 2023						2024						After 2024						Last Three Months of 2023						2024						After 2024
787						150						—						8						142						—						8						142
737 MAX						374						73						100						201						20						77						277
A321neo						130						4						26						100						4						26						100
A321XLR						50						—						—						50						—						—						50
A350						45						—						—						45						—						—						45
(a) United also has options and purchase rights for additional aircraft.
(b) Expected aircraft deliveries reflect adjustments communicated by Boeing and Airbus or estimated by United.

The aircraft listed in the table above are scheduled for delivery through 2033. The amount and timing of the Company's future capital 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 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.

On September 28, 2023, United entered into a supplemental agreement with Boeing, pursuant to which United exercised options to purchase 50 Boeing 787-9 aircraft scheduled for delivery between 2028 and 2031 and was granted options to purchase up to an additional 50 Boeing 787 aircraft. In addition, on September 29, 2023, United entered into an amendment to the A320 Family Purchase Agreement, dated December 19, 2019, as amended, with Airbus, pursuant to which United exercised purchase rights to purchase 60 A321neo aircraft scheduled for delivery between 2028 and 2030 and was granted purchase rights to purchase up to an additional 40 A321neo aircraft. The table above reflects the number of firm commitments related to these agreements as well as the contractual and expected aircraft deliveries.

During the nine months ended September 30, 2023, United entered into agreements with third parties to finance through sale and leaseback transactions new Boeing model 737 MAX aircraft subject to purchase agreements between United and Boeing. For certain aircraft, United assigned its right to purchase such aircraft to the buyer, and simultaneous with the buyer's purchase from Boeing, United entered into a long-term lease for such aircraft with the buyer as lessor. Upon delivery of the aircraft in these sale and leaseback transactions, the Company accounted for these aircraft as part of Flight equipment on the Company's consolidated balance sheet and the related obligation recorded in Current maturities of other financial liabilities and Other financial liabilities since they did not qualify for sale recognition (failed sale and leaseback).

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As of September 30, 2023, United had additional leases for 47 Embraer E175/E175LL regional jets under a CPA, 12 A321neo mainline aircraft, airport facilities and office space, none of which had commenced as of such date. These leases will commence between fourth quarter 2023 and 2026 with lease terms of up to 12 years.

The table below summarizes United's firm commitments as of September 30, 2023, which include aircraft and related spare engines, aircraft improvements and non-aircraft capital commitments. Aircraft commitments are based on contractual scheduled aircraft deliveries without any adjustments communicated by Boeing and Airbus or estimated by United.

(in billions)
Last three months of 2023						$	4.6
2024						8.8
2025						8.0
2026						6.1
2027						5.0
After 2027						29.6
						$	62.1

Regional CPAs. During the nine months ended September 30, 2023, United amended several of its CPAs with certain of its regional carriers to increase the contractually agreed fees (carrier costs) paid to those carriers and to add additional aircraft that will replace existing aircraft near the end of their contractual terms. Separately, the Company terminated its CPA and related regional flight operations with Air Wisconsin in June 2023. Our 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. 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. Based on these assumptions as of September 30, 2023, our estimated future payments through the end of the terms of our CPAs are presented in the table below:

(in billions)
Last three months of 2023						$	0.6
2024						2.2
2025						1.9
2026						2.1
2027						1.6
After 2027						5.7
						$	14.1

Guarantees. As of September 30, 2023, United is the guarantor of approximately $1.9 billion in aggregate principal amount of tax-exempt special facilities revenue bonds and interest thereon. These bonds, 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 recognized on the Company's consolidated balance sheet with the associated expense recorded on a straight-line basis over the expected lease term. All of these bonds are due between 2024 and 2041.

As of September 30, 2023, United is the guarantor of $81 million of aircraft mortgage debt issued by one of United's regional carriers. The aircraft mortgage debt is subject to similar increased cost provisions as described below for the Company's debt, and the Company would potentially be responsible for those costs under the guarantees.

Increased 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 the Secured Overnight Financing Rate (SOFR), for

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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. The Company elected to apply the guidance in Accounting Standards Codification 848, Reference Rate Reform, to contracts and transactions that transitioned from the London Interbank Offered Rate (LIBOR) to SOFR. The application of this guidance did not have any material impact on the Company's financial statements. At September 30, 2023, the Company had $11.4 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 involving loans or leases from non-U.S. entities, with remaining terms of up to approximately 12 years and an aggregate balance of $8.2 billion, the Company bears the risk of any change in tax laws that would subject loan or lease payments thereunder to non-U.S. entities to withholding taxes, subject to customary exclusions.

Labor**.** As of September 30, 2023, the Company had approximately 102,000 employees, of whom approximately 83% were represented by various U.S. labor organizations.

In January 2023, the Company's more than 8,000 technicians and related employees represented by the International Brotherhood of Teamsters ratified an extension to their labor contract with United. The agreement becomes amendable in December 2024 and includes a one-year early opener provision that allows for bargaining on a successor agreement to begin in December 2023.

In May 2023, nearly 30,000 fleet service, passenger service, storekeepers, maintenance instructors and fleet technical instructors and related employees represented by the International Association of Machinists & Aerospace Workers ("IAM") ratified five agreements with United. The ratified agreements are effective through 2025. The Company recorded a one-time $48 million expense in conjunction with the ratification. Negotiations with the IAM will continue for agreements to cover security guards in California and central load planners.

In September 2023, the Company's pilots represented by ALPA ratified an agreement with United. The agreement includes numerous work rule changes and pay rate increases during the four-year term. The agreement also includes a provision for a one-time $765 million payment upon ratification.

NOTE 8 — DEBT

As of September 30, 2023, we had $1.75 billion undrawn and available under our revolving credit facility.

Our debt agreements contain customary terms and conditions as well as various affirmative, negative and financial covenants that, among other things, restrict the ability of the Company and its subsidiaries to incur additional indebtedness and pay dividends or repurchase stock. As of September 30, 2023, UAL and United were in compliance with their respective debt covenants.

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Equipment Notes. On June 20, 2023, the Company and Wilmington Trust, National Association, as subordination agent and pass through trustee (the "Trustee") under a certain pass through trust newly formed by the Company, entered into the Note Purchase Agreement, dated as of June 20, 2023 (the "Note Purchase Agreement"). The Note Purchase Agreement provides for the issuance by the Company of equipment notes (the "Equipment Notes") in the aggregate principal amount of $1.3 billion to finance 39 Boeing aircraft delivered new to the Company from August 2022 to May 2023. Pursuant to the Note Purchase Agreement, the Trustee purchased Equipment Notes issued under a trust indenture and mortgage (each, an "Indenture" and, collectively, the "Indentures") with respect to each aircraft entered into by the Company and Wilmington Trust, National Association, as mortgagee. Each Indenture provides for the issuance of Equipment Notes in a single series, Series A, bearing interest at the rate of 5.80% per annum. The Equipment Notes were purchased by the Trustee, using the proceeds from the sale of Pass Through Certificates, Series 2023-1A, issued by a pass through trust newly-formed by the Company to facilitate the financing of the aircraft. The interest on the Equipment Notes is payable semi-annually on each January 15 and July 15, beginning on January 15, 2024. The principal payments on the Equipment Notes are scheduled on January 15 and July 15 of each year, beginning on July 15, 2024. The final payments on the Equipment Notes will be due on January 15, 2036.

In the second quarter of 2023, United prepaid $1.0 billion of a 2021 term loan facility. See Note 9 for information related to charges recorded as a result of this prepayment.

The table below presents the Company's contractual principal payments (not including $303 million of unamortized debt discount, premiums and debt issuance costs) at September 30, 2023 under then-outstanding long-term debt agreements (in millions):

Last three months of 2023						$	739
2024						3,958
2025						3,442
2026						5,235
2027						2,464
After 2027						14,046
						$	29,884

NOTE 9 — SPECIAL CHARGES

For the three and nine months ended September 30, operating and nonoperating special charges and unrealized (gains) losses on investments in the statements of consolidated operations consisted of the following (in millions):

			Three Months Ended September 30,												Nine Months Ended September 30,
			2023						2022						2023						2022
Labor contract ratification bonuses			$	1					$	—					$	814					$	—
(Gains) losses on sale of assets and other special charges			28						20						88						124
Total operating special charges			29						20						902						124
Nonoperating unrealized (gains) losses on investments, net			54						(28)						(54)						12
Nonoperating debt extinguishment and modification fees			—						—						11						7
Total nonoperating special charges and unrealized (gains) losses on investments, net			54						(28)						(43)						19
Total operating and nonoperating special charges and unrealized (gains) losses on investments, net			83						(8)						859						143
Income tax benefit, net of valuation allowance			(7)						(7)						(204)						(17)
Total operating and nonoperating special charges and unrealized (gains) losses on investments, net of income taxes			$	76					$	(15)					$	655					$	126

2023

Labor contract ratification bonuses. During the nine months ended September 30, 2023, the Company recorded $814 million of expense associated with the agreements with ALPA, IAM and other work groups. See Note 7 for additional information.

(Gains) losses on sale of assets and other special charges. During the three and nine months ended September 30, 2023, the Company recorded $28 million and $88 million, respectively, of net charges primarily comprised of reserves for various legal

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matters, accelerated depreciation related to certain of the Company's assets that will be retired early, an impairment of flight training equipment that is being sold and other gains and losses on the sale of assets.

Nonoperating unrealized (gains) losses on investments, net. During the three and nine months ended September 30, 2023, the Company recorded losses of $54 million and gains of $54 million, respectively, primarily for the change in the market value of its investments in equity securities.

Nonoperating debt extinguishment and modification fees. During the nine months ended September 30, 2023, the Company recorded $11 million of charges primarily related to the prepayment of $1.0 billion of the outstanding principal amount under a 2021 term loan facility.

2022

(Gains) losses on sale of assets and other special charges. During the three and nine months ended September 30, 2022, the Company recorded $20 million and $124 million, respectively, of net charges primarily comprised of $94 million for various legal matters.

Nonoperating unrealized (gains) losses on investments, net. During the three and nine months ended September 30, 2022, the Company recorded gains of $28 million and losses of $12 million, respectively, primarily related to the change in the market value of its investments in equity securities.

Nonoperating debt extinguishment and modification fees. During the nine months ended September 30, 2022, the Company recorded $7 million of charges primarily related to the early redemption of $400 million of the outstanding principal amount of its 4.25% senior notes due 2022.

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