Frontier Group expects aircraft Lease terminations to reduce operating lease Assets and liabilities by approximately $260 million. Investors will see non-cash charges of $60 million to $80 million and cash charges of $90 million to $120 million, while the related aircraft changes are expected to maintain similar capacity with fewer aircraft.

Key Highlights

  • Non-cash charges are expected to total between $60 million and $80 million.
  • Cash costs tied to early lease termination and aircraft returns are projected at $90 million to $120 million.
  • An Aug. 25 agreement with aircraft lessors covers early lease terminations for A320neo aircraft currently in operation.
  • Aircraft are expected to return during the second half of 2026, with non-cash costs of $60 million to $80 million.

Frontier (NASDAQ: ULCC) Airlines, the wholly owned subsidiary, also expects the aircraft changes to maintain similar capacity with fewer aircraft.

Lease Terminations Bring 2026 Charges

An agreement reached Aug. 25 with aircraft lessors covers A320neo aircraft currently in operation, whose leases will end early. The aircraft are expected to return during the second half of 2026. Non-cash costs are expected to range from $60 million to $80 million, mainly reflecting the removal of prepaid maintenance balances that cannot be recovered and accelerated Depreciation on capitalized maintenance. Cash charges connected with the early lease exits and the return of aircraft and engines to Carlyle (NASDAQ: CG) are projected at $90 million to $120 million. Most of those cash payments are expected to be settled in 2028 and 2029.

Similar Capacity With Fewer Aircraft

Frontier Group said the direct leases, together with the early-return agreement, are expected to preserve similar capacity with fewer aircraft. The company identified productivity and flexibility of the A321neo aircraft as supporting features of the arrangement.

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