creating and destroying; built flying cars & autonomous vehicles, now building /faust, more here: /july, web: july.rocks

And where they really make their money is their airline rewards programs. So much so that their businesses flying people are almost all money losing

1/n Do airlines make a lot from their rewards programs? if so, how much? I got curious (thanks @heavygweit & @jachian) about this and wanted to see. United as an example, (source: recent form 8-K and recent 10-Q forms) first some overview:

Revenue:
- United made $27.5B in the first 6 months of 2024:
- Passenger airline operations revenue: $24.99B constitutes about 90.8% of their revenue 
- Cargo operations Revenue: $805M, ~2.9% of total revenue
- Other revenue (including loyalty program earnings like MileagePlus and the credit card partnerships: $1.5B and about ~6.3% of total revenue

Costs:
- United paid $25.5B in the first 6 months of 2024:
- Salaries and related costs $8.03B (31.5% of revenue)
- Aircraft fuel: 6.09B (this seems to fluctuate the most obviously, 23.7% of total revenue)
- Maintenance & repairs: $1.49B
- D&A: $1.43B

Operating Income: 
- $2.03B in the same time (27.5 - 25.5), total margin is about 7.4%
- Passenger Profit: $2.5B
- Cargo Profit: $805M
- MileagePlus (Credit Card Program) $1.5B

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Closer than I thought on the operating income side but this part varies heavily with the cost of fuel compared to operating the reward program

Not apples to apples obviously. The points program doesn’t have legs without the flight operator