JetBlue Airlines 2005 Annual Report Download - page 9

ITEM 1. BUSINESS
Overview
JetBlue Airways Corporation, or JetBlue, is a major low-cost passenger airline that provides
high-quality customer service at low fares primarily on point-to-point routes. As of February 14, 2006,
we operated a total of 369 daily flights. We focus on serving markets that previously were underserved
and/or large metropolitan areas that have had high average fares. We currently serve 34 destinations
in 15 states, Puerto Rico, the Dominican Republic and The Bahamas. We intend to maintain a
disciplined growth strategy by increasing frequency on our existing routes, connecting new city pairs
and entering new markets. For the year ended December 31, 2005, JetBlue was the 9th largest
passenger carrier in the United States based on revenue passenger miles.
We had a net loss of $20 million and net income of $46 million for the years ended December 31,
2005 and 2004, respectively. We generated operating margins of 2.8%and 8.8%in 2005 and 2004,
respectively, which were higher than most other major U.S. airlines, according to reports by those
airlines. This was our first loss since our first year of operations in 2000 and primarily resulted from
the inability to raise fares to fully recover the increased cost of record high fuel prices. Our load
factor (the percentage of aircraft seating capacity actually utilized) of 85.2%during 2005 was higher
than that reported by any of the other major U.S. airlines, whose weighted average load factor was
78.0%. In 2005, we demonstrated our commitment to customer service by attaining the highest
completion factor amongst all major U.S. airlines. We are committed to operating our scheduled
flights whenever possible; however, this philosophy, along with operating at three of the most
congested and delay-prone domestic airports, contributed to a 71.4%on-time performance in 2005,
which was lower than all but one major U.S. airline.
We are scheduled to add 96 new Airbus A320 aircraft and 92 EMBRAER 190 aircraft to our
current operating fleet of 87 Airbus A320 and nine EMBRAER 190 aircraft by the end of 2011. We
have an experienced management team and a strong company culture with a productive and
incentivized workforce that strives to offer high-quality customer service, while at the same time
operating efficiently and keeping costs low. Our high daily aircraft utilization and low distribution
costs also contribute to our low operating costs. Our widely available low fares are designed to
stimulate demand, which we have demonstrated through our ability to increase passenger traffic in the
markets we serve. In addition to our low fares, we offer our customers a differentiated product,
including new aircraft, leather seats, reliable operating performance, 36 channels of free LiveTV (a
satellite TV service with programming provided by DIRECTV®), and movie selections from FOX
InFlight at every seat. In 2006, we plan to add 100 channels of free XM Satellite Radio to our A320
fleet, a service which is already available on our EMBRAER 190 fleet.
JetBlue was incorporated in Delaware in August 1998. Our principal executive offices are located
at 118-29 Queens Boulevard, Forest Hills, New York 11375 and our telephone number is
[phone]. Our filings with the Securities and Exchange Commission, or the SEC, are accessible
free of charge at our website http:// investor.jetblue.com. Information contained on our website is not
incorporated by reference in this report. As used in this Form 10-K, the terms ‘‘JetBlue’’, ‘‘we’’, ‘‘us’’,
‘‘our’’ and similar terms refer to JetBlue Airways Corporation and its subsidiaries, unless the context
indicates otherwise.
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