Sun Country Airlines Holdings, Inc. (SNCY): Business Model Canvas [Dec-2025 Updated]

You're trying to figure out how Sun Country Airlines Holdings, Inc. is navigating the tricky airline space, right? Honestly, their secret sauce isn't just offering low-cost fares to the sun-belt; it's their calculated hybrid approach that brings real stability. We're talking about balancing leisure flyers with high-margin, contracted business, like that Amazon cargo deal. For instance, Q3 2025 saw their Cargo revenue hit $44 million, a 50.9% jump year-over-year, complementing the $58.7 million from charters. This blend, which includes a plan for 20 freighters by 2025, is what makes their Business Model Canvas compelling. Keep reading to see the nine blocks that lock this strategy in place.

Sun Country Airlines Holdings, Inc. (SNCY) - Canvas Business Model: Key Partnerships

You're looking at the backbone of Sun Country Airlines Holdings, Inc. (SNCY)'s diversified revenue stream, which relies heavily on these strategic alliances to smooth out the cyclical nature of leisure travel. These partnerships are not just nice-to-haves; they represent guaranteed revenue blocks that anchor the financial performance, especially as the airline manages its passenger capacity transition.

Amazon (Primary Cargo Contract Extended through 2030)

The relationship with Amazon is central to Sun Country Airlines Holdings, Inc.'s cargo segment stability. The Amended and Restated Air Transport Services Agreement extends the partnership through 2030, with options available to push the term out to 2037.

This deal mandates a significant ramp-up in dedicated freighter operations. Sun Country Airlines Holdings, Inc. is increasing its cargo fleet from 12 to up to 20 Boeing 737-800 converted freighters. The first additional aircraft was expected to enter service in the first quarter of 2025, with all eight new aircraft operational by the third quarter of 2025.

The financial impact is clear in the latest reports. For the third quarter of 2025, cargo revenue surged to $44 million, marking a 50.9% year-over-year increase, reflecting the completion of the 20-aircraft fleet expansion. In the second quarter of 2025, cargo revenue was reported at $34.8 million (or $35 million in another filing), a 36.8% increase versus Q2 2024, driven by the new contract rates that took effect in June 2024.

Here's a quick look at the scale of the cargo commitment:

Metric	Value/Target	Date/Period
Contract Extension End Date	2030 (Option to 2037)	Agreement Term
Total Cargo Aircraft Operated	Up to 20	Q3 2025 Operational Target
Cargo Revenue	$44 million	Q3 2025
Cargo Revenue YoY Growth	50.9%	Q3 2025
Projected Contribution Margin Alignment	On par with passenger flying	Late Q3 2025

The airline temporarily reduced scheduled passenger capacity by about 11% in 2025 to manage the pilot and resource transition for this cargo build-up.

Department of Defense (Long-term Military Charter Contracts)

Sun Country Airlines Holdings, Inc. maintains a steady presence supporting the Department of Defense (DoD) through various Indefinite Delivery/Indefinite Quantity (IDIQ) contracts, which provide reliable charter revenue outside of the leisure cycle. The company is a named awardee on several significant vehicles:

• A potential $4 billion contract for International Charter Airlift Services in Support of the Civil Reserve Air Fleet (CRAF), with work running through September 30, 2026, financed using fiscal 2025 working capital funds. The total cumulative face value for this contract vehicle is listed at $4,005,889,293.
• An Indefinite Delivery Contract (IDC) with the Air Force's Air Mobility Command (AMC) for CRAF services, valued at $86,787,971 and set to complete by September 30, 2030.
• A spot on a potential $873 million IDIQ for domestic air cargo and passenger charter services, active from April 1, 2024, to September 30, 2028.

Execution under these long-term agreements results in discrete task orders. For example, in August and September 2025, Sun Country Airlines Holdings, Inc. received multiple delivery orders from the U.S. Air Force's Air Mobility Command for domestic charter air transportation services, with individual order values ranging from $17,000 up to $312.7K.

Synchrony (New Co-branded Credit Card Issuer)

The transition to Synchrony as the issuer for the Sun Country Visa Signature® credit card, effective September 2025, is a key move to bolster customer loyalty and generate ancillary revenue. The card replaced the previous offering from First National Bank of Omaha.

The card features an $89 annual fee and a welcome offer of 25,000 bonus points, which Sun Country values at $250, earned after spending $1,000 in the first 90 days. Cardholders can achieve the new 'Plus' status by spending $10,000 annually on the card.

Here are the core earning and benefit structures for the Synchrony-issued card:

Earning/Benefit Category	Rate/Value	Condition
Sun Country Purchases (Card Use)	3x points per $1	When using the card
Sun Country Purchases (Flying)	2x points per $1	When flying on Sun Country
Gas/Grocery Purchases	2x points per $1	Everyday spending
All Other Purchases	1x point per $1	Everyday spending
Anniversary Bonus	10,000 points (worth $100)	Spend $10,000 in 12 months
Checked Bag Discount	50% off first bag	For cardholder and companions

Plus status, achievable via the $10,000 annual spend threshold, grants benefits like complimentary Flexible Fares (no change/cancellation fees) and priority boarding (Zone 1) at MSP Terminal 2.

Aircraft Lessors and Maintenance Providers

While specific financial terms with lessors are typically private, the fleet composition is public. As of June 30, 2025, Sun Country Airlines Holdings, Inc. had 45 aircraft in its passenger service fleet and 5 aircraft on lease to unaffiliated airlines. The Amazon cargo expansion involved taking on eight additional Boeing 737-800 freighters, which Amazon owns, transferring them from Atlas Air's operating certificate. This reliance on Amazon-owned aircraft for the cargo segment mitigates Sun Country Airlines Holdings, Inc.'s direct capital outlay for that portion of the fleet expansion.

Honor Flights (Veteran Transport Charter Service)

Sun Country Airlines Holdings, Inc. continues its commitment to veteran transport through partnerships with local and national Honor Flight organizations. The airline provides free transport for veterans, primarily from the World War II, Korean War, and Vietnam War eras, to visit their memorials in Washington, D.C..

Specific regional efforts show the partnership in action. Honor Flight Northland, in partnership with the Duluth Area Chamber Foundation, secured funding for a flight scheduled for May 31, 2025. Since 2010, the Honor Flight Northland chapter alone has seen over 1,000 veterans participate in the program. The CEO noted that the charter team, pilots, and flight attendants find these flights extremely moving.

Finance: draft 2026 capital expenditure forecast incorporating the remaining Amazon aircraft deliveries by end of 2025 by Friday.

Sun Country Airlines Holdings, Inc. (SNCY) - Canvas Business Model: Key Activities

Operating a diversified hybrid service model is central to Sun Country Airlines Holdings, Inc. (SNCY)'s activities, allowing for resource deployment across distinct revenue streams.

The combined revenue contribution from cargo and charter operations reached 40% of total revenue in the third quarter of 2025. For the third quarter of 2025, total revenue was reported at $255.5 million. To give you a look at the segment performance leading up to that, in the second quarter of 2025, cargo revenue was $35 million, marking a 36.8% increase year-over-year, while charter revenue was $54 million, up 6.4% year-over-year. The first quarter of 2025 saw total revenue of $327 million.

Executing the cargo fleet expansion to 20 aircraft in 2025 was a major operational focus, completing a segment transformation by the third quarter of 2025.

The cargo fleet grew from 12 freighters at the start of the year to a full 20 Boeing 737-800 freighters by September 2025. This deployment represented a 14% increase in the total operating aircraft fleet compared to the beginning of 2025. Cargo revenue in the third quarter of 2025 hit $44 million, a 50.9% increase versus the third quarter of 2024, driven by the increased number of aircraft in service and new contract rates. The Air Transport Services Agreement with Amazon is extended through 2030, with options extending through 2037.

Fleet Component (As of September 30, 2025)	Number of Aircraft
Passenger Service Fleet	45
Freighter Aircraft (Cargo)	20
Aircraft on Lease to Unaffiliated Airlines	5
Total Owned/Operated Aircraft	65

Dynamic capacity management and seasonal route planning involve temporarily drawing down scheduled passenger service to absorb the cargo opportunity.

For 2025, system block hours were projected to grow by about 8% year-on-year. To accommodate the cargo growth, scheduled service Available Seat Miles (ASMs) decreased by 6.2% in the second quarter of 2025. The carrier expected scheduled service ASMs to decline further in the fourth quarter of 2025 by approximately 8 to 9% as they annualize the cargo segment growth. The long-term outlook targets an in-service fleet of 70 aircraft (20 cargo, 50 passenger) by the second quarter of 2027.

Maintaining a low-cost structure is challenged during this transition period, reflected in unit costs.

In the third quarter of 2025, Cost per Available Seat Mile (CASM) increased 10.3%, while adjusted CASM increased 5.2%. This followed a second quarter of 2025 where CASM grew 6.3% and adjusted CASM increased 11.3%, largely due to the reduction in scheduled service ASMs. Management anticipated these elevated unit costs would remain until scheduled service business growth resumes in the second half of 2026. The airline currently has a long-term strategy focused on operating mid-life 737 aircraft.

Managing the loyalty program and digital customer experience kicked into high gear with a recent launch.

Sun Country Airlines launched the Sun Country Rewards Program and the Sun Country Rewards Plus Status tier in partnership with Synchrony Bank on September 23, 2025.

• Plus Status qualification requires flying 10 qualifying Sun Country flights or spending $10,000 on the Sun Country Visa Signature Card in a calendar year.
• Plus Member Benefits include a 50% Point Bonus (one additional point per dollar spent on direct bookings).
• Cardmembers earn 3x points immediately on Sun Country purchases, with an additional 2x after the trip is complete.
• Plus Status members earn an extra 1x point per dollar after travel, bringing the total to 6x points per dollar on Sun Country purchases.
• Benefits also include Complimentary Change Fee Waiver and Complimentary Priority Boarding in Zone 1.

The total liquidity position as of September 30, 2025, was $299 million. Finance: review the Q4 2025 cost forecast against the Q3 2025 adjusted CASM of 5.2% growth by next Tuesday.

Sun Country Airlines Holdings, Inc. (SNCY) - Canvas Business Model: Key Resources

You're looking at the core assets Sun Country Airlines Holdings, Inc. (SNCY) uses to execute its strategy. These aren't just things they own; they are the foundational elements that make their hybrid low-cost model work, especially given the recent focus on cargo expansion.

Fleet Composition and Growth

The physical assets, the aircraft, are central. Sun Country Airlines Holdings, Inc. (SNCY) completed a major operational milestone in Q3 2025 by fully deploying its dedicated cargo fleet. This fleet is primarily composed of Boeing 737-800 aircraft, utilized across both passenger and cargo segments.

As of September 30, 2025, the fleet breakdown was:

• Passenger Aircraft: 45 aircraft in service.
• Freighter Aircraft: 20 aircraft operating for Amazon Air.
• Aircraft on Lease: An additional five aircraft were on lease to unaffiliated airlines at that time.

This cargo expansion represented a 14% increase in the total operating aircraft fleet compared to the start of the year. The company plans to grow the passenger fleet to 50 aircraft by 2027.

Low-Cost Platform and Labor Agreements

Sun Country Airlines Holdings, Inc. (SNCY) maintains an ultra-low-cost carrier structure, which is heavily influenced by its labor agreements. The flexibility in labor is a key resource, though recent agreements have reset cost expectations upward.

The flight attendants, represented by Teamsters Local 120, ratified a new five-year collective bargaining agreement in March 2025, covering nearly 800 workers. This agreement, which followed negotiations that started in 2019, included significant financial adjustments:

Metric	Detail
Immediate Wage Increase	21 percent
Wage Increase Over Term	Up to 58 percent
Contract Term	Five years

The pilot contractual rates also increased at the beginning of 2025, and a new flight attendant contract went into effect in March 2025, contributing to a 15.0% year-over-year increase in salaries, wages, and benefits in Q3 2025.

Dedicated Cargo Infrastructure and Operational Bases

The dedicated cargo operation is underpinned by a long-term commitment with Amazon Air. The operational base for the airline is Minneapolis-Saint Paul International Airport (MSP).

The cargo segment's resource base is secured by the contract terms:

• The agreement for the 20 freighter aircraft runs through 2030.
• There are options to extend the terms through 2037.
• Cargo and charter operations combined generated 40% of total revenue in Q3 2025.

The successful deployment of all 20 freighters by September 2025 was a significant operational achievement, allowing the company to shift focus back to scheduled passenger flying.

Balance Sheet Strength

A strong balance sheet provides the financial cushion for operations and strategic flexibility. As of September 30, 2025, the financial position showed:

Financial Metric	Amount (as of 9/30/2025)
Net Debt	$406.1 million
Total Liquidity	$299 million
Total Debt/Lease Obligations	$575.8 million

The company also entered into a new $108 million Term Loan Facility Agreement bearing interest at a fixed rate of 5.98% per annum, drawing down $54 million in September 2025.

Proprietary Systems

Sun Country Airlines Holdings, Inc. (SNCY) relies on integrated technology to manage its unique hybrid model, allowing resources like aircraft and crew to be cross-utilized efficiently between scheduled service, charter, and cargo flying. This integration smooths the peaks and valleys of the scheduled service business.

The systems enable:

• Seamless scheduling across all business lines, utilizing 616 pilots as of a recent report.
• Dynamic deployment of shared resources to capture peak demand in the passenger segment.
• The ability to manage a complex schedule where scheduled service Available Seat Miles (ASMs) decreased by 10.2% year-over-year in Q3 2025 to accommodate cargo growth, while charter block hours increased by 11.1%.

The loyalty and co-brand card program is also a resource expected to contribute meaningfully, projected at approximately $20 million annually at full implementation.

Sun Country Airlines Holdings, Inc. (SNCY) - Canvas Business Model: Value Propositions

You're looking at the core value Sun Country Airlines Holdings, Inc. (SNCY) delivers to its customers and stakeholders as of late 2025. It's a hybrid approach, balancing the low-cost model with high-margin contract flying.

Low-cost fares for leisure and VFR (Visiting Friends and Relatives) travel

Sun Country Airlines Holdings, Inc. (SNCY) commits to providing affordable travel options, especially for leisure and VFR passengers flying out of its Minneapolis-St. Paul International Airport (MSP) hub. This is evident in the scheduled service fare metrics reported through the third quarter of 2025. The total fare per scheduled passenger for the third quarter of 2025 was $143, representing a 1.1% increase year-over-year. For the second quarter of 2025, the total fare per scheduled passenger was $151, which was 6.5% higher than the second quarter of 2024. Revenue per available seat mile (TRASM) for scheduled service in Q3 2025 was 10.6 cents, up 1.6% from the prior year's third quarter. Still, the low-fare positioning is visible in advertised deals; for instance, a one-way flight from MSP to Boston (BOS) was advertised at $89 for Summer 2025.

You can see the low-end pricing in action with some of the featured deals from MSP:

• MSP to Nashville (BNA) from $59.
• MSP to Las Vegas (LAS) from $69.
• MSP to Phoenix (PHX) from $72.
• MSP to Fort Myers (RSW) from $79.

High-margin, stable, contracted cargo and charter services

The stability and higher margin come from the synergistic cargo and charter businesses, which insulate the company somewhat from passenger yield volatility. Cargo and charter combined generated 40% of total revenue in the third quarter of 2025. Cargo revenue specifically saw substantial growth, reaching $44 million in the third quarter of 2025, a 50.9% increase versus the third quarter of 2024. Charter revenue was $58.7 million in Q3 2025, marking a 15.6% year-over-year increase.

Here's a look at the revenue breakdown and fleet allocation supporting this dual model through the first half of 2025:

Metric	Q2 2025 Value	Q3 2025 Value	Change/Note
Total Revenue	$264 million	$255.5 million	Q2 up 3.6% YoY
Cargo Revenue	$35 million	$44 million	Q2 up 36.8% YoY
Charter Revenue	$54 million	$58.7 million	Q3 up 15.6% YoY
Passenger Fleet Aircraft	45 (as of June 30, 2025)	45 (as of September 30, 2025)	Passenger ASMs down 10.2% in Q3
Cargo Fleet Freighter Aircraft	19 (as of June 30, 2025)	20 (as of September 30, 2025)	Cargo block hours up 33.7% in Q3

The company's total liquidity on September 30, 2025, stood at $299 million.

Seasonal flexibility by reallocating shared aircraft resources

Sun Country Airlines Holdings, Inc. (SNCY) dynamically deploys shared aircraft resources across its scheduled, charter, and cargo businesses. This flexibility is demonstrated by the intentional reduction in scheduled passenger capacity to accommodate cargo segment growth. For the second quarter of 2025, scheduled service Available Seat Miles (ASMs) decreased 6.2% year-over-year to support cargo and charter flying. This trend continued into the third quarter, where scheduled service ASMs fell by 10.2% year-over-year. Looking forward, scheduled service ASMs are projected to decline in the fourth quarter of 2025 by approximately 8 to 9% year-over-year to annualize the cargo segment growth. This reallocation is key to maximizing asset utilization across the different business lines.

Nonstop service to popular, sun-belt destinations from Minneapolis

The airline focuses on offering nonstop, affordable travel from its MSP hub to leisure markets, including sun-belt destinations, often extending seasonal routes. Sun Country Airlines is noted to offer weekly flights from MSP to Miami (MIA) and Sarasota (SRQ), extending this service into the summer of 2025, past the typical seasonal end. The Summer 2025 schedule was planned to offer more flight options to its most popular leisure markets. Popular sun-belt and warm-weather destinations served nonstop from MSP include:

• Fort Myers (RSW)
• Orlando (MCO)
• Phoenix (PHX)
• Las Vegas (LAS)
• Tampa (TPA)
• Miami (MIA)

Through Summer 2025, Sun Country Airlines planned to operate 116 routes serving 102 airports.

Sun Country Airlines Holdings, Inc. (SNCY) - Canvas Business Model: Customer Relationships

For Sun Country Airlines Holdings, Inc. (SNCY), customer relationships are segmented across high-touch dedicated service for large contracts and highly automated, transactional interactions for the leisure scheduled service base. The airline's strategy in late 2025 clearly shows a pivot to bolster loyalty and digital engagement while maintaining the stability provided by its charter and cargo clients.

Transactional model for scheduled service bookings

The vast majority of Sun Country Airlines' individual passenger relationships operate on a transactional basis, driven by direct bookings through their digital channels. This model relies on efficiency and competitive pricing to drive volume, though unit revenue management is critical given the capacity shifts. For instance, in the third quarter of 2025, the scheduled service load factor stood at a strong 84.8%, an increase of 0.6 percentage points year-over-year, on 997,947 revenue passengers carried. You can see how the unit revenue metrics trended across the first three quarters of 2025 right here:

Metric (Scheduled Service)	Q1 2025	Q2 2025	Q3 2025
TRASM (cents)	11.63	10.40	10.6
Total Fare per Passenger	$198	$151	$143
YoY Total Fare Change	1.0% increase	6.5% increase	1.1% increase
YoY TRASM Change	4.7% decrease	3.7% increase	1.6% increase

The quick math shows that while the average fare per passenger was highest in Q1 at $198, the unit revenue (TRASM) saw its best year-over-year improvement in Q2 at 3.7%, indicating pricing power was strongest then, despite the lowest average fare of $151 in that quarter. Still, by Q3, the focus on yield improvement was evident with a 1.6% YoY TRASM increase.

Dedicated account management for charter and cargo clients

For charter and cargo clients, the relationship is high-touch, managed through dedicated service to support long-term contracts, most notably with Amazon Air. This diversified revenue stream provided a stable foundation, generating approximately 40% of total revenue in the third quarter of 2025. The cargo segment saw massive growth, with Q3 2025 cargo revenue reaching $44 million, a 50.9% increase versus Q3 2024, supported by a fleet of 20 freighter aircraft as of September 30, 2025. Charter revenue also showed solid growth, hitting $58.7 million in Q3 2025, marking a 15.6% year-over-year increase.

• Cargo block hours increased by 33.7% in Q3 2025.
• Charter block hours increased by 11.1% in Q3 2025.
• Q2 2025 saw cargo revenue at $35 million and charter revenue at $54 million.
• Q1 2025 cargo revenue was $28 million and charter revenue was $55 million.

These figures demonstrate that the cargo segment is the primary driver of revenue acceleration, which requires close, dedicated account management to service the Amazon contract rates that began going into effect in June 2024.

Loyalty program enhancements via new credit card partner

Sun Country Airlines Holdings, Inc. (SNCY) made a significant move to deepen transactional relationships by launching the Sun Country Visa Signature® credit card in partnership with Synchrony Bank in September 2025. This launch was immediately coupled with the introduction of the Sun Country Rewards Plus Status tier, designed to convert high-frequency flyers and high spenders into more committed members. If onboarding takes 14+ days, churn risk rises, but the structure here is clear.

• Plus Status is earned by flying 10 qualifying flights or spending $10,000 on the co-branded Visa card in a calendar year.
• Benefits include earning 1 additional point per dollar on flights booked via the mobile app or website.
• Cardholders also receive a Complimentary Flexible Fare benefit.
• Status grants Priority Boarding (Zone 1) and Priority Check-In access.

This structure directly ties the most valuable relationship benefits to the use of the co-branded card, making the financial product a key relationship retention tool.

Digital self-service tools like the new mobile app

The airline's investment in digital self-service tools is central to managing the high volume of transactional customers efficiently. The new mobile app, which launched in May 2024, serves as the primary digital touchpoint for day-of-travel management. Jim Stathopoulos, Senior Vice President & Chief Information Officer, is overseeing the execution of IT systems that support this digital focus. The app is designed to be a one-stop-shop for customers to manage their entire journey on-the-go.

• Check-in is available between one and 24 hours prior to departure.
• Users can download their mobile boarding pass to skip ticket counter lines.
• Trip management features allow customers to add bags, select seats, or adjust flights.
• The app provides easy access to Sun Country Rewards account information.

Furthermore, in 2023, Sun Country Airlines introduced automated self-service digital tools for customers facing extended delays, simplifying the process for receiving digital hotel/meal vouchers or processing refunds.

Finance: draft 13-week cash view by Friday.

Sun Country Airlines Holdings, Inc. (SNCY) - Canvas Business Model: Channels

You're looking at how Sun Country Airlines Holdings, Inc. (SNCY) gets its product-seats on planes and cargo space-into the hands of customers as of late 2025. The channel strategy clearly leans on a mix of direct-to-consumer digital sales and high-touch contract sales for its specialized businesses.

Direct sales via Sun Country Airlines website and mobile app

The digital storefront is key for the scheduled service. Travelers use the Sun Country Airlines website or the Fly Sun Country mobile app to book, where they can select from Main Cabin, Comfort+, Premium Select, and First Class. While the exact split isn't public, the performance of the scheduled service reflects the effectiveness of these direct channels. For instance, in the third quarter of 2025, the total fare per scheduled passenger was $143, showing pricing power even as Available Seat Miles (ASMs) declined. Also, September 2025 saw a strong load factor of 83% with total fares up 4.5% year-over-year, suggesting customers are booking and filling seats effectively through these primary interfaces. You can book travel through the extended selling schedule, which runs through December 9, 2025, as of early 2025 filings.

Online Travel Agencies (OTAs) for scheduled service

OTAs are certainly part of the mix for the scheduled passenger business, which is the traditional airline channel. However, the strategic focus in 2025 has been on managing capacity in this segment to support cargo growth. Scheduled service ASMs in the third quarter of 2025 were down 10.2% year-over-year. This capacity reduction suggests a deliberate choice to prioritize higher-margin or more stable revenue streams over maximizing every available seat through all channels, including OTAs.

Dedicated sales teams for Charter and Cargo contracts

This is where Sun Country Airlines really diversifies its channel approach, relying on dedicated teams to secure large, predictable contracts. These two segments combined generated around 40% of the total revenue in the third quarter of 2025. The growth here is phenomenal, driven by direct contract negotiation, notably with Amazon for cargo.

Here's a quick look at the contract channel performance for Q3 2025:

Channel Metric	Charter (Q3 2025)	Cargo (Q3 2025)
Revenue Amount	$58.7 million	$44 million
Year-over-Year Growth	15.6%	50.9%
Block Hour Growth	11.1%	33.7%

The cargo segment's growth was supported by the completion of its freighter fleet expansion, ending Q3 2025 with 20 cargo aircraft in service.

Major US airports, including Minneapolis-St. Paul (MSP) hub

The physical presence is anchored by the headquarters and primary hub operations at Minneapolis-St. Paul International Airport (MSP). Sun Country Airlines positions itself as the leisure airline of choice at MSP. The network scale as of early 2025 included operating 116 routes serving nearly 100 airports across the United States, Mexico, Central America, Canada, and the Caribbean. The airline planned to serve approximately 100 destinations in 2025. The channel strategy at MSP involves optimizing the route mix; for example, five seasonal routes from MSP were paused for summer 2025 to focus capacity on the scaling cargo operations.

The fleet supporting these channels as of March 31, 2025, consisted of:

• 45 aircraft in the passenger service fleet.
• 15 freighter aircraft in the cargo fleet.

The expectation was to end 2025 with 45 passenger aircraft and 20 cargo aircraft.

Sun Country Airlines Holdings, Inc. (SNCY) - Canvas Business Model: Customer Segments

You're looking at Sun Country Airlines Holdings, Inc. (SNCY) and seeing a carrier that has strategically layered high-volume, contract-based revenue streams on top of its traditional leisure flying. This diversification is what earned them the Air Transport World Airline Industry Achievement Market Leader Award of 2025. Honestly, the scheduled passenger business is being deliberately managed-or pulled back-to feed the growth in the other two segments. Here's the quick math: Cargo and Charter combined generated $\mathbf{40\%}$ of total revenue in the third quarter of 2025, which is their highest contribution since late 2020.

Leisure and VFR passengers seeking low-cost, nonstop flights

This group forms the foundation of Sun Country Airlines Holdings, Inc.'s Scheduled Service segment, catering to the low-cost, nonstop travel need, especially to leisure spots. However, capacity discipline is the theme for 2025. You see this in the operational shifts; Scheduled service block hours decreased by $\mathbf{10.9\%}$ in the third quarter of 2025 to support the cargo expansion. The airline is prioritizing pricing power over sheer volume in this segment for now. For instance, the total fare per scheduled passenger in Q3 2025 was $\mathbf{\$143}$, which was $\mathbf{1.1\%}$ higher than the prior year, even as the load factor only ticked up $\mathbf{0.6}$ percentage points.

The unit revenue metric, Scheduled service TRASM (Total Revenue per Available Seat Mile), came in at $\mathbf{10.6}$ cents in Q3 2025. Management expects this capacity reallocation to provide a tailwind for scheduled service unit revenues through at least the first quarter of 2026, with scheduled service operations anticipated to resume growth around the second quarter of 2026. As of September 30, 2025, the passenger service fleet stood at $\mathbf{45}$ aircraft.

• Scheduled service ASMs (Available Seat Miles) fell $\mathbf{10.2\%}$ year-over-year in Q3 2025.
• Scheduled service ASMs are projected to decline by approximately $\mathbf{8}$ to $\mathbf{9\%}$ year-over-year in the fourth quarter of 2025.
• The airline plans to expand the passenger fleet to $\mathbf{50}$ aircraft by 2027.

Corporate, government, and sports teams (Charter clients)

The Charter segment provides a stable, high-margin counterbalance to the more cyclical leisure market. This business saw solid growth across the first three quarters of 2025. In the third quarter alone, charter revenue hit $\mathbf{\$58.7}$ million, marking a $\mathbf{15.6\%}$ year-over-year increase. What's telling is that this revenue growth outpaced the $\mathbf{11.1\%}$ increase in charter block hours, suggesting better pricing or utilization within those contracts. To give you a quarter-over-quarter view of this segment's strength:

Period Ended	Charter Revenue (Millions USD)	Year-over-Year Growth
March 31, 2025 (Q1)	$55.0	15.6%
June 30, 2025 (Q2)	$54.0	6.4%
September 30, 2025 (Q3)	$58.7	15.6%

This segment is definitely a key component of the diversified model you're analyzing.

Amazon (primary, high-volume Cargo customer)

This is the growth engine. Sun Country Airlines Holdings, Inc. completed its cargo segment transformation in the third quarter of 2025 by deploying its full complement of $\mathbf{20}$ Boeing 737-800 freighter aircraft for Amazon. This fleet size represents a $\mathbf{14\%}$ expansion in the total operating aircraft compared to the start of the year. The results are clear: Q3 2025 cargo revenue surged $\mathbf{50.9\%}$ year-on-year to $\mathbf{\$44}$ million, driven by both the increased aircraft count and new Amazon contract rates that went into effect in mid-2024. The company projects that with the expanded fleet and rate increases, annual cargo revenue will double to approximately $\mathbf{\$215}$ million per year.

The operational commitment to Amazon is significant:

• Cargo block hours increased $\mathbf{33.7\%}$ in Q3 2025.
• The cargo fleet reached $\mathbf{20}$ freighters as of September 30, 2025.
• Cargo revenue was $\mathbf{\$28}$ million in Q1 2025, growing to $\mathbf{\$35}$ million in Q2 2025.

The amended contract with Amazon runs through 2030, with options extending through 2037, securing this high-volume customer base for the long haul.

Other airlines leasing Sun Country aircraft

A smaller, but still relevant, component of the revenue mix comes from leasing out excess or temporarily unutilized aircraft. As of September 30, 2025, Sun Country Airlines Holdings, Inc. had $\mathbf{5}$ aircraft on lease to unaffiliated airlines. For context, this number was $\mathbf{6}$ aircraft at the end of the first quarter on March 31, 2025. This leasing activity contributes to the Other Revenue line item, which totaled $\mathbf{\$26.8}$ million for the nine months ended September 30, 2025. You should note that management expected this Other Revenue to reduce by approximately $\mathbf{33\%}$ versus Q2 2025 due to a decrease in these lease arrangements.

Sun Country Airlines Holdings, Inc. (SNCY) - Canvas Business Model: Cost Structure

The cost structure for Sun Country Airlines Holdings, Inc. (SNCY) is heavily weighted toward variable expenses, typical of an airline, though the overall structure aims for the lower fixed-cost profile associated with its Ultra Low-Cost Carrier (ULCC) model positioning.

Variable Costs and Fuel Exposure

• Aircraft fuel cost per gallon was projected at $2.61 for the third quarter of 2025 guidance.
• The actual economic fuel cost per gallon for the third quarter of 2025 was reported at $2.55.
• For the fourth quarter of 2025, the projected economic fuel cost per gallon was $2.50.
• Total operating expenses in Q3 2025 grew 3.6% year-over-year, aligned with a 3.8% increase in total block hours.

Labor and Personnel Expenses

Labor costs represent a significant component, reflecting headcount growth and new contractual agreements. Salaries, wages, and benefits increased by 15.0% year-over-year in the third quarter of 2025. This increase was mainly driven by:

• Growth in the number of pilots.
• A contractual pilot wage scale increase effective from the start of the year.
• The new flight attendant contract that went into effect in March 2025.

In the first quarter of 2025, salaries had grown 12.9% year-over-year, attributed to an 8% increase in pilot headcount and a 6% contractual pilot wage scale increase.

Aircraft Ownership and Maintenance

Costs related to the fleet include both fixed charges like rent and depreciation, and variable maintenance costs that spiked recently.

Cost Component	Period/Reference	Amount/Rate
Maintenance Expense Increase (YoY)	Q3 2025	13.5%
Leased Aircraft, Depreciation & Amortization Expense	Q2 2025 (Quarterly)	$3.1 million
Rental Revenue from Assets on Lease	Q3 2025 (Quarterly)	Approx. $7.1 million

The 13.5% year-over-year increase in maintenance expense for the third quarter of 2025 was mainly due to the occurrence of unplanned maintenance events. Management noted that heavy maintenance costs are being pulled forward into Q4 2025 from 2026.

Fixed Cost Structure Elements

Sun Country Airlines Holdings, Inc. operates with a stated low fixed-cost structure, which is a key element of its ULCC approach, allowing for flexibility in capacity deployment between its scheduled, charter, and cargo segments. However, certain costs are fixed or semi-fixed:

• Landing fees and airport rent increased by 9.1% in Q2 2025 due to rate increases at airports.
• Total system Adjusted CASM (Cost per Available Seat Mile) ex-fuel for Q3 2025 was 8.46 cents.
• The GAAP operating margin for Q3 2025 was 3.9%.

Sun Country Airlines Holdings, Inc. (SNCY) - Canvas Business Model: Revenue Streams

You're looking at how Sun Country Airlines Holdings, Inc. (SNCY) actually brings in the cash flow as of late 2025. It's a hybrid model, leaning heavily on specialized contracts alongside traditional flying. Here's the quick math on the revenue streams based on the third quarter of 2025 results.

The total revenue for Sun Country Airlines Holdings, Inc. in the third quarter of 2025 hit $255.5 million, marking their highest third quarter on record. This revenue is strategically diversified, with the cargo and charter segments combined accounting for 40% of that total revenue for the quarter. This mix is key to stabilizing results while the scheduled service capacity was intentionally reduced to support cargo growth.

The revenue streams break down across several key areas:

Revenue Stream Component	Q3 2025 Amount/Metric	Year-over-Year Change
Cargo Service Revenue	$44 million	Up 50.9%
Charter Service Revenue	$58.7 million	Up 15.6%
Other Revenue (Aircraft Lease Income Portion)	$7.1 million (Lease Income)	Down from $10.1 million in Q3 2024

Scheduled Service revenue is still a core component, though capacity was shifted. For the scheduled service, the total fare per scheduled passenger in the third quarter of 2025 was $143. This is an important metric because Scheduled Service TRASM (Total Revenue per Available Seat Mile) showed an inflection, increasing 1.6% overall for the quarter, with September performance showing an increase of over 7%.

For the specialized segments, the growth has been substantial. Cargo revenue reached $44 million in Q3 2025, a 50.9% increase year-over-year, driven by all 20 cargo aircraft being in service for Amazon by late August. Charter revenue also saw strong growth, coming in at $58.7 million, which represents a 15.6% year-over-year increase.

The ancillary revenue component, which covers things like bags and seat selection, is bundled into the Scheduled Service TRASM calculation along with scheduled service revenue itself. What this estimate hides is the precise dollar amount of ancillary revenue separate from the base fare. Other Revenue also includes rental income from assets, with the aircraft lease income portion specifically noted at approximately $7.1 million for the three months ended September 30, 2025.

You can see the composition of the passenger-related revenue streams:

• Scheduled Service total fare per passenger: $143 (Q3 2025)
• Charter revenue: $58.7 million (Q3 2025)
• Charter block hours increase: 11.1% YoY
• Scheduled service ASMs (Available Seat Miles) decrease: 10.2% in Q3 2025