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What changed in AIR LEASE CORP's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of AIR LEASE CORP's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+467 added−399 removedSource: 10-K (2026-02-12) vs 10-K (2025-02-13)

Top changes in AIR LEASE CORP's 2025 10-K

467 paragraphs added · 399 removed · 294 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

61 edited+22 added−14 removed69 unchanged
Biggest changeThe following table sets forth the dollar amount and percentage of our Rental of flight equipment revenues attributable to the respective geographical regions based on each airline’s principal place of business: Year Ended December 31, 2024 Year Ended December 31, 2023 Year Ended December 31, 2022 Region Amount of Rental Revenue % of Total Amount of Rental Revenue % of Total Amount of Rental Revenue % of Total (in thousands, except percentages) Asia Pacific $ 1,004,202 40.4 % $ 1,156,837 46.7 % $ 1,067,270 48.2 % Europe 944,637 38.0 % 769,407 31.1 % 611,091 27.6 % The Middle East and Africa 206,846 8.3 % 262,554 10.6 % 251,243 11.3 % Central America, South America and Mexico 189,919 7.6 % 156,275 6.3 % 141,638 6.4 % U.S. and Canada 142,351 5.7 % 132,534 5.3 % 143,266 6.5 % Total $ 2,487,955 100.0 % $ 2,477,607 100.0 % $ 2,214,508 100.0 % The following table sets forth the regional concentration based on each airline’s principal place of business of our flight equipment subject to operating lease based on net book value as of December 31, 2024 and 2023: December 31, 2024 December 31, 2023 Region Net Book Value % of Total Net Book Value % of Total (in thousands, except percentages) Europe $ 11,653,668 41.4 % $ 9,881,024 37.7 % Asia Pacific 10,077,621 35.8 % 10,456,435 39.8 % Central America, South America, and Mexico 2,685,098 9.5 % 2,361,089 9.0 % The Middle East and Africa 1,971,448 7.0 % 2,062,420 7.9 % U.S. and Canada 1,782,631 6.3 % 1,470,240 5.6 % Total $ 28,170,466 100.0 % $ 26,231,208 100.0 % The following table sets forth our top five lessees by net book value as of December 31, 2024 and 2023: December 31, 2024 December 31, 2023 Lessee % of Total Lessee % of Total Virgin Atlantic 6.5 % EVA Air 4.9 % Air France-KLM Group 6.2 % Virgin Atlantic 4.8 % ITA 5.6 % Air France-KLM Group 4.3 % Vietnam 4.6 % ITA 4.2 % Aeromexico 4.4 % Vietnam Airlines 4.1 % 6 Table of Contents At December 31, 2024 and 2023, we owned and managed leased aircraft to customers in the following regions based on each airline’s principal place of business: December 31, 2024 December 31, 2023 Region Number of Customers (1) % of Total Number of Customers (1) % of Total Europe 51 44.0 % 50 42.0 % Asia Pacific 32 27.6 % 34 28.6 % The Middle East and Africa 14 12.1 % 15 12.6 % U.S. and Canada 11 9.5 % 12 10.1 % Central America, South America and Mexico 8 6.8 % 8 6.7 % Total 116 100.0 % 119 100.0 % (1) A customer is an airline with its own operating certificate.
Biggest changeFor the years ended December 31, 2025, 2024, and 2023, no individual airline contributed more than 10% to our rental revenue. 7 Table of Contents The following table sets forth the regional concentration based on each airline’s principal place of business of our flight equipment subject to operating lease based on net book value as of December 31, 2025 and 2024: December 31, 2025 December 31, 2024 Region Net Book Value % of Total Net Book Value % of Total (in thousands, except percentages) Europe $ 11,356,104 39.1 % $ 11,653,668 41.4 % Asia Pacific 10,602,176 36.5 % 10,077,621 35.8 % Central America, South America, and Mexico 3,114,662 10.7 % 2,685,098 9.5 % The Middle East and Africa 2,254,646 7.8 % 1,971,448 7.0 % U.S. and Canada 1,726,042 5.9 % 1,782,631 6.3 % Total $ 29,053,630 100.0 % $ 28,170,466 100.0 % The following table sets forth our top five lessees by net book value as of December 31, 2025 and 2024: December 31, 2025 December 31, 2024 Lessee % of Total Lessee % of Total Virgin Atlantic 6.1 % Virgin Atlantic 6.5 % Korean Air 6.0 % Air France-KLM Group 6.2 % Air France-KLM Group 5.9 % ITA 5.6 % Aeromexico 5.5 % Vietnam 4.6 % ITA 5.2 % Aeromexico 4.4 % At December 31, 2025 and 2024, we owned and managed leased aircraft to customers in the following regions based on each airline’s principal place of business: December 31, 2025 December 31, 2024 Region Number of Customers (1) % of Total Number of Customers (1) % of Total Europe 45 44.1 % 51 44.0 % Asia Pacific 26 25.5 % 32 27.6 % The Middle East and Africa 13 12.7 % 14 12.1 % U.S. and Canada 10 9.8 % 11 9.5 % Central America, South America and Mexico 8 7.9 % 8 6.8 % Total 102 100.0 % 116 100.0 % (1) A customer is an airline with its own operating certificate.
ITEM 1. BUSINESS Overview Air Lease Corporation (the “Company”, “ALC”, “we”, “our” or “us”) is a leading aircraft leasing company that was founded by aircraft leasing industry pioneer, Steven F. Udvar-Házy. We are principally engaged in purchasing the most modern, fuel-efficient new technology commercial jet aircraft directly from aircraft manufacturers, such as Airbus S.A.S.
ITEM 1. BUSINESS Overview Air Lease Corporation (the “Company”, “AL”, “we”, “our” or “us”) is a leading aircraft leasing company that was founded by aircraft leasing industry pioneer, Steven F. Udvar-Házy. We are principally engaged in purchasing the most modern, fuel-efficient new technology commercial jet aircraft directly from aircraft manufacturers, such as Airbus S.A.S.
Our airline customers are facing higher operating costs as a result of higher fuel costs, persistently elevated interest rates, inflation, foreign currency risk, ongoing labor shortages and disputes, as well as delays and cancellations caused by the global air traffic control system and airports, although strong air traffic demand has provided a counterbalance to these increased costs.
Our airline customers are facing higher operating costs as a result of persistently elevated interest rates, inflation, tariffs, foreign currency risk, volatility in fuel costs, ongoing labor shortages and disputes, as well as delays and cancellations caused by the global air traffic control system and airports, although strong air traffic demand has provided a counterbalance to these increased costs.
In cases where we believe that the agreed value stated in the lease is not sufficient, we make arrangements to cover such deficiency, which would include the purchase of additional “Total Loss Only” coverage for the deficiency. Aircraft hull policies generally contain standard clauses covering aircraft and engines. The lessee is required to pay all deductibles.
In cases where we believe that the agreed value stated in the lease is not sufficient, we make arrangements to cover such deficiency, which would include the purchase of additional “Total Loss Only” coverage for the deficiency. 11 Table of Contents Aircraft hull policies generally contain standard clauses covering aircraft and engines. The lessee is required to pay all deductibles.
As discussed above, our leases contain detailed provisions regarding the required condition of the aircraft and its components upon return at the end of the lease term. Aircraft Sales & Trading Strategy Our strategy is to maintain a portfolio of young modern aircraft with a widely diversified customer base.
As discussed above, our leases contain detailed provisions regarding the required condition of the aircraft and its components upon return at the end of the lease term. 10 Table of Contents Aircraft Sales & Trading Strategy Our strategy is to maintain a portfolio of young modern aircraft with a widely diversified customer base.
Competition in the purchase and sale of used aircraft is based principally on the availability of used aircraft, price, the terms of the lease to which an aircraft is subject, and the creditworthiness of the lessee, if any. 10 Table of Contents Government Regulation The air transportation industry is highly regulated.
Competition in the purchase and sale of used aircraft is based principally on the availability of used aircraft, price, the terms of the lease to which an aircraft is subject, and the creditworthiness of the lessee, if any. Government Regulation The air transportation industry is highly regulated.
This allows us to better serve our airline customers and expand our existing airline customer base by providing additional leasing opportunities beyond our own aircraft portfolio, new order pipeline, and customer or regional concentration limits. As of December 31, 2024, we had a managed fleet of 60 aircraft.
This allows us to better serve our airline customers and expand our existing airline customer base by providing additional leasing opportunities beyond our own aircraft portfolio, new order pipeline, and customer or regional concentration limits. As of December 31, 2025, we had a managed fleet of 45 aircraft.
We also believe the increase in lease rates and the sustained tightness in the credit markets may result in a shortfall of available capital to finance aircraft purchases, which could increase the demand for leasing.
We also believe the 6 Table of Contents increase in lease rates and the sustained tightness in the credit markets may result in a shortfall of available capital to finance aircraft purchases, which could increase the demand for leasing.
We also have the ability to seek debt financing secured by our assets, as well as financings supported through government-guaranteed export credit agencies for most of our future aircraft deliveries.
We also have the ability to seek debt financing secured by our assets, as well as financings supported through government-guaranteed export credit agencies for most of our future aircraft deliveries. See “Item 7.
For example, Russia, Ukraine, Belarus and the Republic of Sudan are now generally excluded from coverage in our contingent liability, contingent hull and contingent hull war insurance. Competition The leasing, remarketing, and sale of aircraft is highly competitive.
For example, Russia, Ukraine, Belarus and Crimea are now generally excluded from coverage in our contingent liability, contingent hull and contingent hull war insurance. Competition The leasing, remarketing, and sale of aircraft is highly competitive.
We work 7 Table of Contents closely with our airline customers throughout the world to help optimize their long-term aircraft fleet strategies. We may also, from time to time, work with our airline customers to assist them in obtaining financing for aircraft.
We work closely with our airline customers throughout the world to help optimize their long-term aircraft fleet strategies. We may also, from time to time, work with our airline customers to assist them in obtaining financing for aircraft.
In addition, factors and trends including increased airline financing needs, Original Equipment Manufacturer (“OEM”) supply chain challenges and backlogs, the elevated price of jet fuel, and environmental sustainability objectives impact the commercial aircraft leasing industry in the short-term and may increase the demand for our aircraft.
In addition, factors and trends including increased airline financing needs, Original Equipment Manufacturer (“OEM”) supply chain challenges and backlogs and environmental sustainability objectives impact the commercial aircraft leasing industry in the short-term and may increase the demand for our aircraft.
In order to maximize residual values and minimize the risk of obsolescence, our strategy is to own an aircraft during the first third of its expected 25-year useful life. During the year ended December 31, 2024, we purchased 65 new aircraft from Airbus and Boeing, and sold 39 aircraft.
In order to maximize residual values and minimize the risk of obsolescence, our strategy is to own an aircraft during the first third of its expected 25-year useful life. During the year ended December 31, 2025, we purchased 49 new aircraft from Airbus and Boeing, and sold 48 aircraft.
As of December 31, 2024, we had 165 full-time employees. None of our employees are represented by a union or collective bargaining agreements. Access to Our Information We file annual, quarterly, current reports, proxy statements and other information with the Securities and Exchange Commission (the “SEC”).
As of December 31, 2025, we had 160 full-time employees. None of our employees are represented by a union or collective bargaining agreements. 13 Table of Contents Access to Our Information We file annual, quarterly, current reports, proxy statements and other information with the Securities and Exchange Commission (the “SEC”).
In addition, our leases are all structured as triple net leases, whereby the lessee is responsible for all operating costs, including taxes, insurance and maintenance and also contain provisions that require payment whether or not the aircraft is operated, irrespective of the circumstances. Substantially all of our leases require payments to be made in U.S. dollars.
In addition, our leases are all structured as triple net leases, whereby the lessee is responsible for all operating costs, including taxes, insurance and maintenance and also contain provisions that require payment whether or not the aircraft is operated, irrespective of the circumstances.
The weighted average age of our fleet was 4.6 years and the weighted average lease term remaining was 7.2 years as of December 31, 2024. Our managed fleet was comprised of 60 aircraft as of December 31, 2024 compared to 78 aircraft as of December 31, 2023.
The weighted average age of our fleet was 4.9 years and the weighted average lease term remaining was 7.2 years as of December 31, 2025. Our managed fleet was comprised of 45 aircraft as of December 31, 2025 compared to 60 aircraft as of December 31, 2024.
Airline reorganizations, liquidations, or other forms of bankruptcies occurring in the industry may include some of our aircraft customers and result in the early return of aircraft or changes in our lease terms.
Airline reorganizations, liquidations, or other forms of bankruptcies occurring in the industry have in the past and may in the future include some of our aircraft customers. Such events have resulted and may in the future result in the early return of aircraft or changes in our lease terms.
We have a globally diversified customer base comprised of 116 airlines in 58 countries as of December 31, 2024. We continued to maintain a strong lease utilization rate of 100.0% for the year ended December 31, 2024.
We have a globally diversified customer base comprised of 102 airlines in 53 countries as of December 31, 2025. We continued to maintain a strong lease utilization rate of 100% for the year ended December 31, 2025.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” for more information on our financial results for the year ended December 31, 2024.
See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” for more information on our financial results for the year ended December 31, 2025.
Insurance We require our lessees to obtain insurance coverage that is customary in the air transportation industry, including comprehensive liability insurance, aircraft all-risk hull insurance, and war-risk insurance covering risks such as hijacking, terrorism, confiscation, expropriation, seizure, and nationalization.
Insurance We generally require our lessees to obtain insurance coverage that is customary in the air transportation industry, including comprehensive liability insurance, aircraft all-risk hull insurance, and war-risk insurance covering risks such as hijacking, terrorism, confiscation, expropriation, seizure, and nationalization. We generally require a certificate of insurance from the lessee’s insurance broker prior to delivery of an aircraft.
When placing new aircraft orders with the manufacturers, we strategically target the replacement of aging aircraft with modern technology aircraft. Additionally, we look to supplement our order pipeline with opportunistic purchases of aircraft in the secondary market and participate in sale-leaseback transactions with airlines. Prior to ordering aircraft, we evaluate the market for specific types of aircraft.
Our strategy is to order new aircraft directly from the manufacturers. When placing new aircraft orders with the manufacturers, we strategically target the replacement of aging aircraft with modern technology aircraft. Additionally, we look to supplement our order pipeline with opportunistic purchases of aircraft in the secondary market and participate in sale-leaseback transactions with airlines.
Adjusted net income before income taxes 1 during the year ended December 31, 2024 was $574.2 million or $5.13 per adjusted diluted share, as compared to $733.6 million, or $6.58 per adjusted diluted share, for the year ended December 31, 2023.
Adjusted net income before income taxes 2 during the year ended December 31, 2025 was $718.4 million or $6.40 per adjusted diluted share, as compared to $574.2 million, or $5.13 per adjusted diluted share, for the year ended December 31, 2024.
As a function of these laws and the provisions in our lease contracts, the lessees are responsible for performing all maintenance of the aircraft and returning the aircraft and its components in a specified return condition.
Federal Aviation Administration (“FAA”) or its equivalent in foreign jurisdictions. As a function of these laws and the provisions in our lease contracts, the lessees are responsible for performing all maintenance of the aircraft and returning the aircraft and its components in a specified return condition.
We maintain a high level of communication with the lessee and frequently evaluate the state of the market in which the lessee operates, including the impact of changes in passenger air travel and preferences, the impact of delivery delays, changes in general economic conditions, emerging competition, new government regulations, regional catastrophes, and other unforeseen shocks that are relevant to the airline’s market. 8 Table of Contents This enables us to identify lessees that may be experiencing operating and financial difficulties.
We maintain a high level of communication with the lessee and frequently evaluate the state of the market in which the lessee operates, including the impact of changes in passenger air travel and preferences, the impact of delivery delays, changes in general economic conditions, emerging competition, new government regulations, regional catastrophes, and other unforeseen shocks that are relevant to the airline’s market.
Our net income attributable to common stockholders for the year ended December 31, 2024 was $372.1 million, or $3.33 per diluted share, as compared to $572.9 million, or $5.14 per diluted share, for the year ended December 31, 2023.
During the year ended December 31, 2025, our net income attributable to common stockholders was $1.0 billion, or $9.29 per diluted share, as compared to $372.1 million, or $3.33 per diluted share, for the year ended December 31, 2024.
This identification assists us in assessing the lessee’s ability to fulfill its obligations under the lease. This monitoring also identifies candidates, where appropriate, to restructure the lease prior to the lessee’s insolvency or the initiation of bankruptcy or similar proceedings.
This enables us to identify lessees that may be experiencing operating and financial difficulties. This identification assists us in assessing the lessee’s ability to fulfill its obligations under the lease. This monitoring also identifies candidates, where appropriate, to restructure the lease prior to the lessee’s insolvency or the initiation of bankruptcy or similar proceedings.
We ended the year with a total of 489 aircraft in our owned fleet. The net book value of our fleet grew by 7.4% to $28.2 billion as of December 31, 2024 compared to $26.2 billion as of December 31, 2023.
We ended the year with a total of 490 aircraft in our owned fleet. The net book value of our fleet 1 grew by 3.1% to $29.1 billion as of December 31, 2025 compared to $28.2 billion as of December 31, 2024.
The International Air Transport Association (“IATA”) reported that passenger traffic was up 10% during 2024 relative to the prior year, primarily due to continued strength in international traffic and healthy continued expansion of domestic traffic globally.
The International Air Transport Association (“IATA”) reported that 2025 passenger traffic was up 5.3% relative to the prior year, primarily due to continued strength in international traffic, offsetting more modest expansion of domestic traffic globally.
Operations to Date Current Fleet The net book value of our fleet 2 increased by 7.4% to $28.2 billion as of December 31, 2024 compared to $26.2 billion as of December 31, 2023. As of December 31, 2024, we owned 489 aircraft in our aircraft portfolio, comprised of 355 narrowbody aircraft and 134 widebody aircraft.
Operations to Date Current Fleet The net book value of our fleet increased by 3.1% to $29.1 billion as of December 31, 2025 compared to $28.2 billion as of December 31, 2024. As of December 31, 2025, we owned 490 aircraft in our aircraft portfolio, comprised of 352 narrowbody aircraft and 138 widebody aircraft.
We are also subject to the regulatory authority of the DOS and the U.S. Department of Commerce (the “DOC”) to the extent such authority relates to the export of aircraft for lease and sale to foreign entities and the export of parts to be installed on our aircraft.
Department of Commerce (the “DOC”) to the extent such authority relates to the export of aircraft for lease and sale to foreign entities and the export of parts to be installed on our aircraft. We may be required to obtain export licenses for parts installed in aircraft exported to foreign countries. The DOC and the U.S.
We are also committed to fostering and cultivating a culture of inclusion. As of December 31, 2024, 39% of our employees are multicultural and 52% are female. Our values and priorities are further specified in our code of conduct and our ethics-related compliance policies, procedures, trainings, and programs.
As of December 31, 2025, 39% of our employees are multicultural and 51% are female. Our values and priorities are further specified in our code of conduct and our ethics-related compliance policies, procedures, trainings, and programs.
We ended 2024 with $29.5 billion in committed minimum future rental payments, consisting of $18.3 billion in contracted minimum rental payments on the aircraft in our existing fleet and $11.2 billion in minimum future rental payments related to aircraft which will deliver between 2025 through 2029.
We ended 2025 with $28.9 billion in committed minimum future rental payments, consisting of $19.6 billion in contracted minimum rental payments on the aircraft in our existing fleet and $9.3 billion in minimum future rental payments related to aircraft which will deliver from 2026 through 2031.
International traffic in 2024 rose 14% relative to the prior year, benefiting from robust continued international travel expansion in the Asia Pacific region, as well as strong expansion in most other major international markets reported by IATA. Global domestic traffic rose 6% during 2024 as compared to the prior year, remaining above the pace of global GDP expansion.
International traffic rose 7.1% in 2025 as compared to the prior year, benefiting from robust continued international travel expansion in the Asia Pacific region, as well as strong expansion in most other major international markets reported by IATA.
We also have a globally diversified customer base with an average country concentration of approximately 1.9% of our fleet net book value as of December 31, 2024.
Our customer base is highly diversified, with an average customer concentration of approximately 1.1% of our fleet net book value as of December 31, 2025.
In addition, our leases require the lessee to be responsible for compliance with applicable laws and regulations with respect to the aircraft. We require our lessees to comply with the standards of either the U.S. Federal Aviation Administration (“FAA”) or its equivalent in foreign jurisdictions.
Substantially all of our leases require payments to be made in U.S. dollars. 9 Table of Contents In addition, our leases require the lessee to be responsible for compliance with applicable laws and regulations with respect to the aircraft. We require our lessees to comply with the standards of either the U.S.
Aligned with the needs of our customers, reduced fuel consumption, emissions, and noise are a priority when selecting an aircraft to join our fleet.
Aligned with the needs of our customers, reduced fuel consumption, emissions, and noise are a priority when selecting an aircraft to join our fleet. Many of the improvements related to fuel efficiency within the aviation industry have been the result of airlines operating new, more fuel-efficient aircraft.
The territorial coverage, in each case, should be suitable for the lessee’s area of operations and based on available insurance coverages.
In accordance with our lease agreements, insurance premiums are paid by the lessee, with coverage acknowledged by the broker or carrier. The territorial coverage, in each case, should be suitable for the lessee’s area of operations and based on available insurance coverages.
Each airline we lease to must have a valid operation certificate to operate our aircraft. Our lessees are obligated to maintain the Certificates of Airworthiness for the aircraft they lease. Our involvement with the civil aviation authorities of foreign jurisdictions consists largely of requests to register and deregister our aircraft on those countries’ registries.
Each airline we lease to must have a valid operation certificate to operate our aircraft. Our lessees are obligated to maintain the Certificates of Airworthiness for the aircraft they lease.
We consider the overall demand for the aircraft type in the marketplace based on our deep knowledge of the aviation industry and our customer relationships. It is important to assess the airplane’s economic viability, the operating performance characteristics, engine variant options, intended utilization by our customers, and which aircraft types it will replace or compete within the global market.
It is important to assess the airplane’s economic viability, the operating performance characteristics, engine variant options, intended utilization by our customers, and which aircraft types it will replace or compete with in the global market. Additionally, we study the effects of global airline passenger traffic growth in order to determine the likely demand for our new aircraft upon delivery.
Willis 46 Executive Vice President and Chief Financial Officer Alex A. Khatibi 64 Executive Vice President, Marketing Kishore Korde 51 Executive Vice President, Marketing Grant A. Levy 62 Executive Vice President, Marketing and Commercial Affairs John D. Poerschke 63 Executive Vice President of Aircraft Procurement and Specifications David Beker 47 Executive Vice President, Marketing 13 Table of Contents
Levy 63 Executive Vice President, Marketing and Commercial Affairs John D. Poerschke 64 Executive Vice President of Aircraft Procurement and Specifications David Beker 48 Executive Vice President, Marketing 14 Table of Contents
Many of the improvements related to fuel efficiency within the aviation industry have been the result of airlines operating new, more fuel-efficient aircraft. 11 Table of Contents Human Capital Resources Culture and Values We strive to conduct our business with integrity and in an honest and responsible manner and to build and maintain long-term, mutually beneficial relationships with our customers, suppliers, shareholders, employees and other stakeholders.
Human Capital Resources Culture and Values We strive to conduct our business with integrity and in an honest and responsible manner and to build and maintain long-term, mutually beneficial relationships with our customers, suppliers, shareholders, employees and other stakeholders. We are also committed to fostering and cultivating a culture of inclusion.
Lease agreements generally require hull and liability limits to be in U.S. dollars, which are shown on the certificate of insurance. In accordance with our lease agreements, insurance premiums are paid by the lessee, with coverage acknowledged by the broker or carrier.
Generally, all certificates of insurance contain a breach of warranty endorsement so that our interests are not prejudiced by any act or omission of the lessee. Lease agreements generally require hull and liability limits to be in U.S. dollars, which are shown on the certificate of insurance.
We ended 2024 with an aggregate borrowing capacity under our revolving credit facility of $7.6 billion and total liquidity of $8.1 billion. As of December 31, 2024, we had total debt outstanding of $20.4 billion, of which 79.0% was at a fixed rate and 97.3% of which was unsecured, and in the aggregate, our composite cost of funds was 4.14%.
As of December 31, 2025, we had total debt outstanding of $19.9 billion, of which 76.8% was at a fixed rate and 97.5% was unsecured, and in the aggregate, our composite cost of funds was 4.15%.
Based on our views of the market and assumptions around our sales activity and interest rate environment, we expect to see a moderately-sized upward trajectory in lease yield by the end of 2025 and for each year for the next three to four years.
Based on our views of the market and assumptions around our sales activity and interest rate environment, we expect to see a moderately-sized upward trajectory in lease yield through 2029, subject, however, to the uncertain impact that the trade policies and related tariff rates may have on demand for aircraft.
As of December 31, 2024, the weighted average fleet age and weighted average remaining lease term of our fleet was 4.6 years and 7.2 years, respectively.
As of December 31, 2025, the weighted average fleet age and weighted average remaining lease term of our fleet was 4.9 years and 7.2 years, respectively. We had a managed fleet of 45 aircraft as of December 31, 2025 compared to 60 as of December 31, 2024. Geographic Diversification Over 95% of our aircraft are operated internationally.
We expect the need for airlines to replace aging aircraft will also increase the demand for newer, more fuel efficient aircraft. As a result, we believe many airlines will look to lessors for these new aircraft.
While further impact from tariffs or global macroeconomic conditions could have incremental negative impact on traffic expectations, we continue to expect the need for airlines to replace aging aircraft will support demand for newer, more fuel efficient aircraft. As a result, we believe many airlines will look to lessors to fulfill these needs.
Aircraft Acquisition Strategy We seek to acquire the most highly in demand and widely distributed, modern technology, fuel efficient and lowest emissions narrowbody and widebody commercial jet aircraft, with a primary focus on passenger aircraft. Our strategy is to order new aircraft directly from the manufacturers.
We also have a globally diversified customer base with an average country concentration of approximately 2.0% of our fleet net book value as of December 31, 2025. 8 Table of Contents Aircraft Acquisition Strategy We seek to acquire the most highly in demand and widely distributed, modern technology, fuel efficient and lowest emissions narrowbody and widebody commercial jet aircraft, with a primary focus on passenger aircraft.
Oftentimes, we are able to achieve lower pricing through direct bulk purchase contracts with the component manufacturers than would be achievable if we relied on the airframe manufacturers to source the components for the aircraft themselves. Airframe manufacturers such as Airbus and Boeing install these buyer furnished equipment in our aircraft during the final assembly process at their facilities.
For new aircraft deliveries, we source many components separately, which include seats, safety equipment, avionics, galleys, cabin finishes, engines, and other equipment. Oftentimes, we are able to achieve lower pricing through direct bulk purchase contracts with the component manufacturers than would be achievable if we relied on the airframe manufacturers to source the components for the aircraft themselves.
The increased demand for our aircraft, combined with elevated interest rates and inflation, helped to increase lease rates on new lease agreements and lease extensions during the year ended December 31, 2024.
We also expect that relatively low levels of widebody retirements in recent years could lead to an accelerated replacement cycle of older widebody aircraft in the future. The strong demand for our aircraft, combined with elevated interest rates and inflation, helped to increase lease rates on new lease agreements and lease extensions during the year ended December 31, 2025.
We had a managed fleet of 60 aircraft as of December 31, 2024 compared to 78 as of December 31, 2023. 2 References throughout this Annual Report on Form 10-K to “our fleet” refer to the aircraft included in flight equipment subject to operating leases and do not include aircraft in our managed fleet, our flight equipment held for sale or aircraft classified as net investments in sales-type leases unless the context indicates otherwise. 5 Table of Contents Geographic Diversification Over 95% of our aircraft are operated internationally.
See the section entitled “Proposed Merger” below for more information on the Orderbook Transfer (as defined in the Merger Agreement) and its impact on future rental payments for aircraft that deliver after the effective time of the Merger (as defined below). 1 References throughout this Annual Report on Form 10-K to “our fleet” refer to the aircraft included in flight equipment subject to operating leases and do not include aircraft in our managed fleet, our flight equipment held for sale or aircraft classified as net investments in sales-type leases unless the context indicates otherwise. 4 Table of Contents Our total revenues for the year ended December 31, 2025 increased by 10.3% to $3.0 billion as compared to 2024.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Annual Report on Form 10-K for a discussion of adjusted net income before income taxes and adjusted diluted earnings per share before income taxes as non-GAAP measures and a reconciliation of these measures to net income attributable to common stockholders. 4 Table of Contents the Boeing labor strike in late 2024.
Management’s Discussion and Analysis of Financial Condition and Results of Operations” of this Annual Report on Form 10-K for a discussion of adjusted net income before income taxes and adjusted diluted earnings per share before income taxes as non-GAAP measures and a reconciliation of these measures to net income attributable to common stockholders. 5 Table of Contents Preferred Stock”) and 6.00% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series D (“Series D Preferred Stock”) of the Company issued and outstanding immediately prior to the Effective Time will remain outstanding and will be deemed to be a share of preferred stock of the surviving corporation with the same rights, powers, privileges and voting powers, and restrictions and limitations thereof applicable to such series of preferred stock.
As global air traffic continues to expand, we are experiencing increased demand for our aircraft through new lease requests and lease extension requests, which we expect to continue into 2025. Airline forward ticket sales as reported by a number of major airlines remained healthy in the fourth quarter 2024, illustrating continued support for traffic volume expansion.
As global air traffic continues to expand and aircraft production volumes remain constrained, we are experiencing strong demand for our aircraft through new lease requests and lease extension requests, which we expect to continue throughout 2026. The number of scheduled flights globally has continued to expand in recent months relative to 2024, suggesting continued consistent passenger volume support.
As of December 31, 2024, we had commitments to purchase 269 aircraft from Airbus and Boeing for delivery through 2029, with an estimated aggregate commitment of $17.1 billion. We have placed 100% of our expected orderbook on long-term leases for aircraft delivering through the end of 2026 and have placed approximately 62% of our entire orderbook.
As of December 31, 2025, we had commitments to purchase 218 aircraft from Airbus and Boeing for delivery through 2031, with an estimated aggregate commitment of $12.6 billion.
Meanwhile, passenger load factors also continue to rise and are persisting at historically high levels, which is compounding airline demand for additional aircraft. IATA reported total global passenger load factors of 84% for 2024, as compared to 82% in the prior year period and 79% for full-year 2022.
Global domestic traffic rose 2.4% during 2025 as compared to the prior year, with strength in most markets outside of the U.S. domestic market. Meanwhile, passenger load factors are persisting at historically high levels with IATA reporting total global passenger load factors of 84% for 2025, continuing to support airline demand for additional aircraft.
Information included or referred to on, or otherwise accessible through, our website is not intended to form a part of or be incorporated by reference into this report. 12 Table of Contents Information about our Executive Officers Set forth below is certain information concerning each of our executive officers as of February 13, 2025, including his/her age and current position with us.
We may post information that is important to investors on our website. Information included or referred to on, or otherwise accessible through, our website is not intended to form a part of or be incorporated by reference into this report.
In addition, both Airbus and Boeing have ongoing delivery delays which have been further compounded by engine manufacturer delays, shorter on-wing engine time of most new technology engines and, most recently, 1 Adjusted net income before income taxes excludes the effects of certain non-cash items such as non-cash deemed dividends upon redemption of our Series A preferred stock, one-time or non-recurring items that are not expected to continue in the future, such as net write-offs and recoveries related to our former Russian fleet, and certain other items.
Pursuant to the Merger Agreement, at the Effective Time, each share of 4.65% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series B (“Series B Preferred Stock”), 4.125% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series C (“Series C 2 Adjusted net income before income taxes excludes the effects of certain non-cash items such as non-cash deemed dividends upon redemption of our Series A preferred stock, non-recurring items that are not expected to continue in the future, such as retirement compensation, merger related costs and recoveries related to our former Russian fleet, and certain other items.
With this purchasing strategy, we are able to both meet specific customer configuration requirements and lower our total acquisition cost of the aircraft. Aircraft Leasing Strategy The airline industry is complex and constantly evolving due to changes in the competitive landscape and passenger traffic patterns.
Airframe manufacturers such as Airbus and Boeing install these buyer furnished equipment in our aircraft during the final assembly process at their facilities. With this purchasing strategy, we are able to both meet specific customer configuration requirements and lower our total acquisition cost of the aircraft.
During the year ended December 31, 2024, we recognized $169.7 million in gains from the sale of 39 aircraft, compared to $146.4 million in gains from the sale of 25 aircraft for the year ended December 31, 2023. 3 Table of Contents We finance the purchase of aircraft and our business with available cash balances and internally generated funds, including through cash flows from our operating leases, aircraft sales and trading activity and debt financings.
During the year ended December 31, 2025, we recognized $244.4 million in gains from the sale of 48 aircraft, compared to $169.7 million in gains from the sale of 39 aircraft for the year ended December 31, 2024.
Our net income attributable to common stockholders decreased from the prior year primarily due to higher interest expense, driven by the increase in our composite cost of funds and overall outstanding debt balance, partially offset by the increase in total revenue as discussed above.
Adjusted net income before income taxes increased primarily due to higher total revenues, partially offset by increases in depreciation expense and interest expense, as discussed above.
Our debt financing strategy is focused on raising unsecured debt in the global bank and debt capital markets, with limited utilization of government guaranteed export credit or other forms of secured financing.
Our long-term debt financing strategy is focused on raising primarily unsecured debt in the global bank and investment grade capital markets, with limited utilization of government guaranteed export credit or other forms of secured financing, however, pursuant to the Merger Agreement (as defined below), from September 1, 2025 to May 1, 2026, we are restricted from incurring additional indebtedness, other than borrowings under our existing revolving credit facilities and our commercial paper program without Parent’s (as defined below) prior written consent (which shall not be unreasonably withheld, conditioned or delayed).
The labor strike impacted Boeing’s ability to produce and deliver aircraft in our orderbook and we anticipate ongoing impacts to our Boeing orderbook deliveries. We expect deliveries of our 737MAX aircraft and some 787 deliveries will continue to be impacted by the residual effects of the labor strike and the FAA’s heightened involvement in Boeing’s production rates.
In addition, both Airbus and Boeing have experienced delivery delays which have been further compounded by engine manufacturer delays, shorter on-wing engine time of most new technology engines and ongoing supply chain challenges. We expect deliveries of our 737 MAX aircraft will continue to be impacted by the FAA’s involvement in Boeing’s production rates.
Removed
Our total revenues for the year ended December 31, 2024 increased by 1.8% to $2.7 billion as compared to 2023.
Added
We have placed 99% and 82% of our orderbook on long-term leases for aircraft delivering through the end of 2027 and 2028, respectively, and have placed approximately 64% of our entire orderbook through 2031.
Removed
The increase in our total revenues was primarily due to an increase in aircraft sales and trading activity and the growth of our fleet, partially offset by a decrease in end of lease revenue of $100.1 million as compared to the prior period, due to fewer aircraft returns during the year ended December 31, 2024, as well as a slight decrease in our lease yields due to the sales of older aircraft with higher lease yields and the purchases of new aircraft with lower initial lease yields.
Added
The increase is primarily due to the continued growth in our fleet by net book value, an increase in our portfolio lease yield as well as an increase in our aircraft sales activity.
Removed
During 2024, we raised approximately $5.6 billion in committed debt financings, with floating interest rates ranging from one-month SOFR plus 1.02% and one-month SOFR plus 1.40% and fixed interest rates ranging from 5.10% to 5.95%, net of the effects of cross-currency hedging arrangements.
Added
We finance the purchase of aircraft and our business with our available cash balances and internally generated funds, which includes cash flows from our leases, as well as aircraft sales and debt financing activities.
Removed
In addition, for the year ended December 31, 2023, we recognized a net benefit of approximately $67.0 million for the settlement of insurance claims under S7’s insurance policies related to four aircraft previously included in our owned fleet and our equity interest in certain aircraft in our managed fleet that were previously on lease to S7. See “Item 7.
Added
We ended 2025 with available liquidity of $7.5 billion, which was comprised of unrestricted cash of $466.4 million and approximately $7.0 billion in undrawn balances under our committed unsecured revolving credit facility, net of $1.4 billion in commercial paper borrowings.
Removed
Adjusted net income before income taxes decreased primarily due to higher interest expense, driven by the increase in our composite cost of funds and overall outstanding debt balance, partially offset by the increase in total revenue as discussed above. Aircraft Industry We believe the current airline operating environment is favorably positioned for us and the broader commercial aircraft leasing industry.
Added
The increase from the prior year period is primarily due to a net benefit of $736.4 million from the settlement of insurance claims with certain insurers related to aircraft detained in Russia and higher revenues, as discussed above, partially offset by an increase in depreciation expense due to the growth of our fleet, an increase in interest expense due to higher average cost of funds throughout the year, $18.8 million in compensation expense related to the retirement of our Chairman from his executive role, $18.5 million in costs associated with the merger, and $9.5 million in legal costs associated with litigation involving our Russian fleet.
Removed
In addition, the Boeing labor strike could lead to negative impacts on the broader aviation supply chain which could ultimately impact other OEMs, including Airbus. We also expect that relatively low levels of widebody retirements in recent years could lead to an accelerated replacement cycle of older widebody aircraft in the future.
Added
Proposed Merger On September 1, 2025, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”), with Sumisho Air Lease Corporation Designated Activity Company (formerly known as Gladiatora Designated Activity Company), an Irish private limited company (“Parent”) and Takeoff Merger Sub Inc., a Delaware corporation and an indirect wholly owned subsidiary of Parent (“Merger Sub”), pursuant to which, among other things and subject to the conditions contained in the Merger Agreement, Merger Sub will merge with and into the Company, with the Company surviving as an indirect wholly owned subsidiary of Parent (the “Merger”).
Removed
Our new aircraft deliveries in the fourth quarter of 2024 represented our highest delivery lease yield in a quarter in over four years; however, lease rate increases continue to lag behind our rising borrowing costs.
Added
Parent is a new holding company owned by Sumitomo Corporation, a Japanese corporation, SMBC Aviation Capital Limited, a company incorporated with limited liability in Ireland (“SMBC AC”), affiliates of Apollo Capital Management, L.P. and affiliates of Brookfield Asset Management Ltd.
Removed
For the year ended December 31, 2024, no individual country represented at least 10% of our rental revenue based on each airline’s principal place of business; however, for the years ended December 31, 2023 and 2022, China was the only individual country that represented at least 10% of our rental revenue based on each airline’s principal place of business with rental revenues of $330.8 million and $360.0 million, respectively.
Added
Pursuant to the Merger Agreement, subject to the conditions set forth therein, at the effective time of the Merger (the “Effective Time”), each issued and outstanding share of Class A common stock of the Company (the “Common Stock”) (other than (i) any Dissenting Shares (as defined in the Merger Agreement) and (ii) shares to be canceled or converted into shares of the surviving company pursuant to the Merger Agreement), will be converted into the right to receive $65.00 in cash, without interest.
Removed
For the years ended December 31, 2024, 2023 and 2022, no individual airline contributed more than 10% to our rental revenue. Our customer base is highly diversified, with an average customer concentration of approximately 1.0% of our fleet net book value as of December 31, 2024.
Added
On December 18, 2025, the Company’s Class A common stockholders approved and adopted the Merger Agreement at a special meeting of stockholders.
Removed
Additionally, we study the effects of global airline passenger traffic growth in order to determine the likely demand for our new aircraft upon delivery. For new aircraft deliveries, we source many components separately, which include seats, safety equipment, avionics, galleys, cabin finishes, engines, and other equipment.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeSuch laws and regulations may be interpreted or applied in a manner that is inconsistent with each other and may complicate our existing data management practices. Evolving compliance and operational requirements under the privacy laws of the jurisdictions in which we operate, regulations, and other obligations have become increasingly burdensome and complex.
Biggest changeEvolving compliance and operational requirements under the privacy laws of the jurisdictions in which we operate, regulations, and other obligations have become increasingly burdensome and complex. We are also bound by contractual obligations related to data privacy and security, and our efforts to comply with such obligations may not be successful.
Our fleet, as well as the aircraft that we have on order, have exposure to a decline in customer demand or obsolescence, particularly if unanticipated events occur which shorten the life cycle of such aircraft types, including: the introduction of superior aircraft or technology, such as new airframes or engines with higher fuel efficiency; the entrance of new manufacturers which could offer aircraft that are more attractive to our target lessees, including manufacturers of alternative technology aircraft; the advent of alternative transportation technologies which could make travel by air less desirable; government regulations, including those limiting noise and emissions and the age of aircraft operating in a jurisdiction; the costs of operating an aircraft, including maintenance which increases with aircraft age; and compliance with airworthiness directives.
Our fleet, as well as the aircraft that we have on order, have exposure to a decline in customer demand or obsolescence, particularly if unanticipated events occur which shorten the life cycle of such aircraft types, including: the introduction of superior aircraft or technology, such as new airframes or engines with higher fuel efficiency or maintenance reliability; the entrance of new manufacturers which could offer aircraft that are more attractive to our target lessees, including manufacturers of alternative technology aircraft; the advent of alternative transportation technologies which could make travel by air less desirable; government regulations, including those limiting noise and emissions and the age of aircraft operating in a jurisdiction; the costs of operating an aircraft, including maintenance which increases with aircraft age; and compliance with airworthiness directives.
An adverse economic, legal or political event in or related to these regions, or deterioration of government relations between the U.S. and these regions, could affect the ability of these lessees to meet their obligations to us, or expose us to various associated legal or political risks, which could have an adverse effect on our financial condition.
An adverse economic, legal or political event in or related to these regions, or deterioration of government relations between the U.S. and these regions, could affect the ability of these lessees to meet their obligations to us, or expose us to various legal or political risks, which could have an adverse effect on our financial condition.
For a description of our impairment policy, see the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates—Flight equipment.” If we were to record an impairment charge on aircraft, or if we were to dispose of aircraft for a price that is less than its depreciated book value on our balance sheet, it would reduce our total assets and shareholders’ equity and increase our debt-to-equity ratio.
For a description of our impairment policy, see the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates—Flight equipment.” If we were to record an impairment charge on aircraft, or if we were to dispose of aircraft for a price that is less than its depreciated book value on our balance sheet, it would reduce our total assets and stockholders’ equity and increase our debt-to-equity ratio.
Such interests involve significant risks that may not be present with other methods of ownership, including that: • we may not realize a satisfactory return on our investment; • the investment may divert management’s attention from our core business; 22 Table of Contents • our investment partners could have investment goals that are not consistent with our investment objectives, including the timing, terms and strategies for any investments; • our investment partners may fail to fund their share of required capital contributions or fulfill their other obligations; and • our investment partners may have competing interests in our markets that could create conflict of interest issues, particularly if aircraft owned by the applicable investment entity are being marketed for lease or sale at a time when we also have comparable aircraft available for lease or sale.
Such interests involve significant risks that may not be present with other methods of ownership, including that: • we may not realize a satisfactory return on our investment; • the investment may divert management’s attention from our core business; • our investment partners could have investment goals that are not consistent with our investment objectives, including the timing, terms and strategies for any investments; • our investment partners may fail to fund their share of required capital contributions or fulfill their other obligations; and • our investment partners may have competing interests in our markets that could create conflict of interest issues, particularly if aircraft owned by the applicable investment entity are being marketed for lease or sale at a time when we also have comparable aircraft available for lease or sale.
Export restrictions and tariffs may impact where we can place and deliver our aircraft and negatively impact our ability to execute on our long-term strategy. Existing export restrictions impact where we can place and deliver our aircraft.
Export and import restrictions and tariffs may impact where we can place and deliver our aircraft and negatively impact our ability to execute on our long-term strategy. Existing export restrictions impact where we can place and deliver our aircraft.
Through our lessees and the countries in which they operate, we are exposed to the specific economic, legal and political conditions and associated risks of those jurisdictions. As of December 31, 2024, we had concentrated customer exposure with our top five lessees by net book value, listed below under “Item 7.
Through our lessees and the countries in which they operate, we are exposed to the specific economic, legal and political conditions and associated risks of those jurisdictions. As of December 31, 2025, we had concentrated customer exposure with our top five lessees by net book value, listed below under “Item 7.
Further, our tax obligations and effective tax rate could increase as a result of international tax developments, including the implementation of the base erosion and profit shifting (“BEPS”) project that was led by the Organization for Economic Cooperation and Development (“OECD”), a coalition of member countries.
Our tax obligations and effective tax rate could also increase as a result of international tax developments, including the implementation of the base erosion and profit shifting (“BEPS”) project that was led by the Organization for Economic Cooperation and Development (“OECD”), a coalition of member countries.
For the year ended December 31, 2024, more than 95% of our revenues were derived from customers who have their principal place of business outside the U.S. and most leases designated payment currency is U.S. dollars.
For the year ended December 31, 2025, more than 95% of our revenues were derived from customers who have their principal place of business outside the U.S. and most leases designated payment currency is U.S. dollars.
Depending on the size of the impairment, a reduction in our shareholders’ equity may negatively impact our assigned credit rating from ratings agencies or our ability to comply with financial maintenance covenants in certain of our agreements governing our indebtedness.
Depending on the size of the impairment, a reduction in our stockholders’ equity may negatively impact our assigned credit rating from ratings agencies or our ability to comply with financial maintenance covenants in certain of our agreements governing our indebtedness.
In addition, some competitors may have higher risk tolerances, lower investment return expectations or different risk or residual value assessments, which could allow them to consider a wider variety of investments, establish more relationships, bid more aggressively on aviation assets available for sale and offer lower lease rates or sale prices than we can.
In addition, some competitors may have higher risk tolerances, lower investment return expectations or different risk or residual value assessments, which could allow them to consider a wider variety of investments, establish more relationships, bid more aggressively on aviation assets available for sale and offer lower 24 Table of Contents lease rates or sale prices than we can.
Violation of laws or regulations may result in increased liabilities including penalties and fines as well as reputational harm. 26 Table of Contents A lessee’s failure to obtain required licenses, consents and approvals could negatively affect our ability to remarket or sell aircraft. Airlines are subject to extensive regulation in the jurisdictions in which they are registered and operate.
Violation of laws or regulations may result in increased liabilities including penalties and fines as well as reputational harm. A lessee’s failure to obtain required licenses, consents and approvals could negatively affect our ability to remarket or sell aircraft. Airlines are subject to extensive regulation in the jurisdictions in which they are registered and operate.
The ability of our lessees to make lease payments to us in U.S. dollars may be adversely impacted in the event of an appreciating U.S. dollar. This is particularly true for non-U.S. airlines whose operations are primarily domestic. Shifts in foreign exchange rates can be significant, are difficult to predict, and can occur quickly.
The ability of our lessees to make lease payments to us in U.S. dollars may be adversely impacted in the event of an appreciating U.S. dollar. This is particularly true for non-U.S. airlines whose operations are primarily domestic. Shifts in foreign exchange rates can be significant, are difficult to 29 Table of Contents predict, and can occur quickly.
This exclusive forum provision is intended to apply to claims arising under Delaware state law and 27 Table of Contents would not apply to claims brought pursuant to the Securities Exchange Act of 1934 (the “Exchange Act”) or Securities Act of 1933 (the “Securities Act”), each as amended, or any other claim for which the federal courts have exclusive jurisdiction.
This exclusive forum provision is intended to apply to claims arising under Delaware state law and would not apply to claims brought pursuant to the Securities Exchange Act of 1934 (the “Exchange Act”) or Securities Act of 1933 (the “Securities Act”), each as amended, or any other claim for which the federal courts have exclusive jurisdiction.
As the result of the existence of these financial and non-financial covenants and our need to comply with them, the flexibility we have to operate our business may be limited. 15 Table of Contents Operational risks relating to our business We may be unable to generate sufficient returns on our aircraft investments which may have an adverse impact on our net income.
As the result of the existence of these financial and non-financial covenants and our need to comply with them, the flexibility we have to operate our business may be limited. Operational risks relating to our business We may be unable to generate sufficient returns on our aircraft investments which may have an adverse impact on our net income.
As 17 Table of Contents a result of these factors, our earnings and cash flows may be impacted by any decrease in the value of aircraft that we own or acquire or decrease in market rates for leases for these aircraft. Inflationary pressure may have a negative impact on our financial results, including by diminishing the value of our leases.
As a result of these factors, our earnings and cash flows may be impacted by any decrease in the value of aircraft that we own or acquire or decrease in market rates for leases for these aircraft. Inflationary pressure may have a negative impact on our financial results, including by diminishing the value of our leases.
The OECD recommended changes to numerous long-standing tax principles, including the implementation of a minimum global effective tax rate of 15%. A number of countries in which we conduct 25 Table of Contents business have enacted, or are in the process of enacting, core elements of these rules.
The OECD recommended changes to numerous long-standing tax principles, including the implementation of a minimum global effective tax rate of 15%. A number of countries in which we conduct business have enacted, or are in the process of enacting, core elements of these rules.
The airline industry is subject to increasingly stringent and evolving federal, state and local environmental laws, regulations, fees, taxes and reporting of air emissions, water surface and subsurface discharges, safe drinking water, aircraft noise, the management of hazardous substances, oils and waste materials and other regulations affecting aircraft operations.
The airline industry is subject to increasingly stringent and evolving environmental laws, regulations, fees, taxes and reporting of air emissions, water surface and subsurface discharges, safe drinking water, aircraft noise, the management of hazardous substances, oils and waste materials and other regulations affecting aircraft operations.
A shift in monetary policy in the United States and other countries beginning in 2022 14 Table of Contents resulted in rapid interest rate increases over a relatively short period of time and many are predicting that rates may remain elevated despite rate cuts in late 2024 by the Federal Reserve Open Market Committee (“FOMC”).
A shift in monetary policy in the United States and other countries beginning in 2022 resulted in rapid interest rate increases over a relatively short period of time and many are predicting that rates may remain elevated despite rate cuts in late 2024 and 2025 by the Federal Reserve Open Market Committee (“FOMC”).
Deterioration of future lease rates and the residual values of our aircraft could result in impairment charges which may have a significant impact on our financial results. The occurrence of unexpected events or changing conditions may also result in impairment charges.
Deterioration of future lease rates and the residual values of our aircraft could result in impairment charges which may have a significant impact on our financial results. The occurrence of unexpected events or changing 22 Table of Contents conditions may also result in impairment charges.
This can result in economic and political instability which could negatively affect the ability of our lessees to meet their 24 Table of Contents lease obligations leading to higher default rates, which could cause us to record asset write-offs.
This can result in economic and political instability which could negatively affect the ability of our lessees to meet their lease obligations leading to higher default rates, which could cause us to record asset write-offs.
Management’s Discussion and Analysis of Financial Condition and Results of Operations—Our Fleet” and we also had approximately 7.8% and 2.5% of our aircraft by net book value on lease to lessees located in Taiwan and China, respectively.
Management’s Discussion and Analysis of Financial Condition and Results of Operations—Our Fleet” and we also had approximately 7.7% and 0.8% of our aircraft by net book value on lease to lessees located in Taiwan and China, respectively.
Macroeconomic and global risks relating to our business Events outside of our control, including the threat or realization of epidemic diseases such as the COVID-19 pandemic, natural disasters, terrorist attacks, war or armed hostilities between countries or non-state actors, may adversely affect the demand for air travel, the financial condition of our lessees and of the aviation industry more broadly, or our operations and may ultimately impact our business.
Macroeconomic and global risks relating to our business Events outside of our control, including the threat or realization of epidemic diseases, natural disasters, terrorist attacks, war or armed hostilities between countries or non-state actors, may adversely affect the demand for air travel, the financial condition of our lessees and of the aviation industry more broadly, or our operations and may ultimately impact our business.
Issuing additional shares of Class A common stock or other equity may dilute the economic and voting rights of our existing stockholders or reduce the market price of our Class A common stock.
Issuing additional shares of Class A common stock or other 32 Table of Contents equity may dilute the economic and voting rights of our existing stockholders or reduce the market price of our Class A common stock.
In addition, lease default levels will likely increase over time if economic conditions deteriorate. In recent years, a majority of our lessees received lease deferrals or other accommodations during the COVID-19 pandemic, and we may agree to deferrals, restructurings and terminations in the ordinary course of our business in the future.
In addition, lease default levels will likely increase over time if economic conditions deteriorate. We may agree to deferrals, restructurings and terminations in the ordinary course of our business. For example, during the COVID-19 pandemic, a majority of our lessees received lease deferrals or other accommodations.
In addition, a significant number of shares of our Class A common stock may be sold in the public market by any selling stockholders listed in a prospectus we may file with the SEC and such sales, or the perception they may occur, could adversely affect prices for our Class A common stock. 28 Table of Contents ITEM 1B.
In addition, a significant number of shares of our Class A common stock may be sold in the public market by any selling stockholders listed in a prospectus we may file with the SEC and such sales, or the perception they may occur, could adversely affect prices for our Class A common stock.
We could also incur substantial maintenance, refurbishment or repair costs if a defaulting lessee fails to pay such costs when necessary to put the aircraft in suitable condition for remarketing or 19 Table of Contents sale.
We could also incur substantial maintenance, refurbishment or repair costs if a defaulting lessee fails to pay such costs when necessary to put the aircraft in suitable condition for remarketing or sale.
If manufacturers fail to meet their contractual obligations to us, we may experience: • missed or late aircraft deliveries and potential inability to meet our contractual delivery obligations owed to our lessees, resulting in potential lost or delayed revenues, and strained customer relationships; • an inability to acquire aircraft and engines resulting in lower growth or contraction of our aircraft fleet; • reduced demand for a particular manufacturer’s product, which may lead to reduced market lease rates and lower aircraft residual values and may affect our ability to remarket or sell at a profit, or at all, some of the aircraft in our fleet; and • technical or other difficulties with aircraft or engines after delivery that subject aircraft to operating restrictions, groundings or increased maintenance requirements, resulting in a decline in residual value and lease rates of such aircraft and impair our ability to lease or dispose of such aircraft or engines on favorable terms or at all. 16 Table of Contents There have been well-publicized delivery delays by airframe and engine manufacturers.
If manufacturers fail to meet their contractual obligations to us, we may experience: • missed or late aircraft deliveries and potential inability to meet our contractual delivery obligations owed to our lessees, resulting in potential lost or delayed revenues, and strained customer relationships; • an inability to acquire aircraft and engines resulting in lower growth or contraction of our aircraft fleet; • reduced demand for a particular manufacturer’s product, which may lead to reduced market lease rates and lower aircraft residual values and may affect our ability to remarket or sell at a profit, or at all, some of the aircraft in our fleet; and • technical or other difficulties with aircraft or engines after delivery that subject aircraft to operating restrictions, groundings or increased maintenance requirements, resulting in a decline in residual value and lease rates of such aircraft and impair our ability to lease or dispose of such aircraft or engines on favorable terms or at all.
Increases in 23 Table of Contents production levels could result in an oversupply of relatively new aircraft if growth in airline traffic does not meet airline industry expectations.
Increases in production levels could result in an oversupply of relatively new aircraft if growth in airline traffic does not meet airline industry expectations.
While we terminated all of our leasing activities in Russia in March 2022, these sanctions and export controls continue to place restrictions on where and how certain of our lessees can operate aircraft they lease from us. Tariffs can also impact our ability to place and deliver aircraft.
While we terminated all of our leasing activities in Russia in March 2022, these sanctions and export controls continue to place restrictions on where and how certain of our lessees can operate aircraft they lease from us.
Future epidemic diseases and other diseases, or the fear of such events could provoke responses that negatively affect passenger air travel. Air travel has also been disrupted by the occurrence of natural disasters and other natural phenomena, such as extreme weather conditions, floods, fires, hurricanes, earthquakes, and volcanic eruptions.
Future epidemic diseases and other diseases, or the fear of such events could provoke responses that negatively affect passenger air travel. Air travel has also been disrupted by the occurrence of natural disasters and other natural phenomena, such as extreme weather conditions, floods, fires, hurricanes, earthquakes, and volcanic eruptions. Disruptions due to natural disasters may become more frequent or severe.
For example, as a result of the Russia-Ukraine conflict, we recorded a net write-off of our interests in our owned and managed aircraft detained in Russia totaling approximately $771.5 million for the year ended December 31, 2022. In addition, the Hamas-Israel conflict resulted in a declaration of war from Israel.
For example, as a result of the Russia-Ukraine conflict, we recorded a net write-off of our interests in our owned and managed aircraft detained in Russia totaling approximately $771.5 million for the year ended December 31, 2022.
We finance our business through a combination of short-term and long-term debt financings predominantly at fixed rate. As of December 31, 2024, we had $16.1 billion of fixed rate debt and $4.3 billion of floating rate debt outstanding.
We finance our business through a combination of short-term and long-term debt financings predominantly at fixed rate. As of December 31, 2025, we had $15.3 billion of fixed rate debt and $4.6 billion of floating rate debt outstanding.
While these sustainability initiatives are in the early stages of development, if alternative aircraft technology develops to the point of commercial viability and become widely accepted, we may not be able to adjust our orderbook in a timely manner and could be required to incur increased costs and significant capital investments to transition to such technology.
While these sustainability initiatives are in the early stages of development, if alternative aircraft technology develops to the point of commercial viability and become widely accepted, we may not be able to adjust our orderbook in a timely manner and could be required to incur increased costs and significant capital investments to transition to such technology. 30 Table of Contents Climate change may have a long-term impact on our business.
In addition, the ongoing impact from Pratt & Whitney GTF engine manufacturing flaws is resulting in accelerated engine removal and incremental shop visits, which have resulted and may continue to result in delivery delays of these engines for new aircraft.
In addition, the ongoing impact from Pratt & Whitney GTF engine manufacturing flaws is resulting in accelerated engine removal and incremental shop visits, which have resulted and may continue to result in delivery delays of these engines for new aircraft. Because of these delays, we have agreed to revised contractual delivery dates for our Airbus and Boeing aircraft.
Most of our credit facilities require us to comply with certain financial maintenance covenants (measured at the end of each quarter) including minimum consolidated shareholders’ equity, minimum consolidated unencumbered assets, and an interest coverage test.
Some of the agreements governing our indebtedness contain financial and non-financial covenants. Most of our credit facilities require us to comply with certain financial maintenance covenants (measured at the end of each quarter) including minimum consolidated stockholders’ equity, minimum consolidated unencumbered assets, and an interest coverage test.
Failure to complete our planned aircraft sales could affect our net income and may lead us to use alternative sources of liquidity. Proceeds from aircraft sales in our owned portfolio help supplement our liquidity position, contribute to our net income and improve our debt-to-equity ratio. We currently expect to sell approximately $1.5 billion in aircraft in 2025.
Failure to complete our planned aircraft sales could affect our net income and may lead us to use alternative sources of liquidity. Proceeds from aircraft sales in our owned portfolio help supplement our liquidity position, contribute to our net income and improve our debt-to-equity ratio.
Growing our fleet will require us to obtain substantial capital through additional financing, which may not be available to us on favorable terms or at all. As of December 31, 2024, we had 269 new aircraft on order with an estimated aggregate purchase price of approximately $17.1 billion.
Growing our fleet will require us to obtain substantial capital through additional financing, which may not be available to us on favorable terms or at all. As of December 31, 2025, we had 218 new aircraft on order with an estimated aggregate commitment of approximately $12.6 billion.
As of December 31, 2024, we had entered into binding purchase commitments to acquire a total of 269 new aircraft for delivery through 2029.
As of December 31, 2025, we had entered into binding purchase commitments to acquire a total of 218 new aircraft for delivery through 2031.
As of December 31, 2024, our total consolidated indebtedness, net of discounts and issuance costs, was approximately $20.2 billion and our interest payments were approximately $794.3 million for the year ended December 31, 2024. We expect these amounts to grow as we acquire more aircraft.
As of December 31, 2025, our total consolidated indebtedness, net of discounts and issuance costs, was approximately $19.7 billion and our interest payments were approximately $915.8 million for the year ended December 31, 2025. We expect these amounts to grow as we acquire more aircraft.
Inflation may increase the costs of goods, services and labor used in our operations, thereby increasing our expenses. In addition, inflation has also contributed to the increase in market values for aircraft including older generation aircraft.
High rates of inflation may have a number of adverse effects on our business. Inflation may increase the costs of goods, services and labor used in our operations, thereby increasing our expenses. In addition, inflation has also contributed to the increase in market values for aircraft including older generation aircraft.
If we are unable to comply with financial maintenance covenants, it could result in an event of default under such agreements. For these reasons, our financial results may be impacted. The Russian-Ukraine conflict and the impact of related sanctions may continue to impact our business.
If we are unable to comply with financial maintenance covenants, it could result in an event of default under such agreements. For these reasons, our financial results may be impacted.
For example, the CCPA, which applies to business representative and other types of personal data of California residents, provides for civil penalties and allows private litigants affected by certain data breaches to recover significant statutory damages.
For example, the CCPA, which applies to business representative and other types of personal data of California residents, provides for civil penalties and allows private litigants affected by certain data breaches to recover significant statutory damages. Additionally, the U.S. Department of Justice issued a rule entitled Preventing Access to U.S.
This in turn could lead to lease restructurings and repossessions, impair our ability to remarket or otherwise dispose of aircraft on favorable terms or at all, or reduce the proceeds we receive for our aircraft in a disposition which may ultimately impact our business.
This in turn could lead to lease restructurings and repossessions, impair our ability to remarket or otherwise dispose of aircraft on favorable terms or at all, or reduce the proceeds we receive for our aircraft in a disposition which may ultimately impact our business. 27 Table of Contents Aircraft oversupply in the industry could decrease the value and lease rates of the aircraft in our fleet resulting in an impact to our earnings and cash flows.
Moreover, if interest rates remain elevated, we will be unable to immediately offset the negative impact on our net income by increasing lease rates, even if the market were able to bear the increased lease rates.
Increased interest rates prevailing in the market at the time of our incurrence of new debt will also increase our interest expense. Moreover, if interest rates remain elevated, we will be unable to immediately offset the negative impact on our net income by increasing lease rates, even if the market were able to bear the increased lease rates.
Other factors include, but are not limited to: manufacturer production levels and technological innovation; the number of airlines operating the aircraft; our lessees’ failure to maintain our aircraft; the impact of decisions by the regulatory authority under which the aircraft is operated and any applicable airworthiness directives, service bulletins or other regulatory action that could prevent or limit utilization of the aircraft.
Other factors include, but are not limited to: manufacturer production levels and technological innovation; the number of airlines operating the aircraft; our lessees’ failure to maintain our aircraft, including as a result of increases in maintenance costs for aircraft and engines seen during 2025 which we expect will continue in 2026; the impact of decisions by the regulatory authority under which the aircraft is operated and any applicable airworthiness directives, service bulletins or other regulatory action that could prevent or limit utilization of the aircraft.
Our leases are primarily structured as triple net leases, whereby the lessee is responsible for all operating costs including the costs associated with the importation of the aircraft.
Our leases are primarily structured as triple net leases, whereby the lessee is responsible for all operating costs including the costs associated with the importation of aircraft. Our lessees are generally obligated to pay such tariffs to customs authorities.
Actual or anticipated changes or downgrades in our credit ratings, including any announcement that our ratings are under review for a downgrade, could increase our borrowing costs and limit our access to the capital markets, including our commercial paper program which may adversely impact our net income and/or our ability to compete in the marketplace.
Actual or anticipated changes or downgrades in our credit ratings, including any announcement that our ratings are under review for a downgrade, could increase our borrowing costs and limit our access to the capital markets, including our commercial paper program which may adversely impact our net income and/or our ability to compete in the marketplace. 19 Table of Contents Certain of our debt agreements contain covenants that impose restrictions on us and our subsidiaries that may limit our flexibility to operate our business.
If we were to lose the services of any of the members of our senior management team, it may negatively impact our business. 21 Table of Contents A cyberattack or other interruption could lead to a material disruption of our information technology (“IT”) systems or the IT systems of our third-party providers and the loss of information, which may hinder our ability to conduct our business effectively and may result in lost revenues and additional costs.
A cyberattack or other interruption could lead to a material disruption of our information technology (“IT”) systems or the IT systems of our third-party providers and the loss of information, which may hinder our ability to conduct our business effectively and may result in lost revenues and additional costs.
We may encounter disputes, deadlock or other conflicts of interest with investment partners of entities in which we have minority interests and for which we serve as manager of the aircraft owned by the entities which may result in legal challenges, reputational harm or loss of fee income.
Any conflicts of interest that arise between us and the clients which utilize our fleet management services may result in legal challenges or reputational harm to our business. 26 Table of Contents We may encounter disputes, deadlock or other conflicts of interest with investment partners of entities in which we have minority interests and for which we serve as manager of the aircraft owned by the entities which may result in legal challenges, reputational harm or loss of fee income.
Our inability to complete the sales of such aircraft on the timeline anticipated, or at all, it could impact our net income and may lead us to use alternative sources of liquidity to fund our operations such as additional capital markets issuances or borrowings under our credit facilities.
Our inability to complete the sales of such aircraft on the timeline anticipated, or at all, could impact our net income and may lead us to use alternative sources of liquidity to fund our operations such as additional capital markets issuances or borrowings under our credit facilities. 20 Table of Contents The failure of an aircraft or engine manufacturer to meet its delivery obligations to us may negatively impact our ability to grow our fleet and our earnings.
Our future success will depend, to a significant extent, upon the continued service of our senior management team, particularly: Mr. Udvar-Házy, our founder, and Executive Chairman of the Board; Mr. Plueger, our Chief Executive Officer and President; and our other senior officers, each of whose services are critical to the success of our business strategies.
Our future success will depend, to a significant extent, upon the continued service of our senior management team, particularly: Mr. 25 Table of Contents Plueger, our Chief Executive Officer and President; and our other senior officers, each of whose services are critical to the success of our business strategies. We do not have employment agreements with Mr.
We do not have employment agreements with Mr. Udvar-Házy or Mr. Plueger for their services at Air Lease Corporation, although one of our Irish subsidiaries has limited duration employment agreements under which Mr. Udvar-Házy and Mr. Plueger may terminate their employment at any time.
Plueger and our other senior officers for their services at Air Lease Corporation, although one of our Irish subsidiaries has limited duration employment agreements under which Mr. Plueger and certain of our other senior officers may terminate their employment at any time.
The demand for our aircraft is also affected by other factors outside of our control, including: air passenger demand; air cargo demand; air travel restrictions; airline financial health; changes in fuel costs, interest rates, foreign currency, inflation and general economic conditions; technical problems associated with a particular aircraft or engine model; airport and air traffic control infrastructure constraints; and the availability and cost of financing.
Obsolescence of certain aircraft may also trigger impairment charges, increase depreciation expense or result in losses related to aircraft asset value guarantees, if we provide such guarantees. 21 Table of Contents The demand for our aircraft is also affected by other factors outside of our control, including: air passenger demand; air cargo demand; air travel restrictions; airline financial health; changes in fuel costs, interest rates, foreign currency, potential tariffs, inflation and general economic conditions; technical or maintenance problems or costs associated with a particular aircraft or engine model; airport and air traffic control infrastructure constraints; and the availability and cost of financing.
Our customer base is highly diversified, with an average customer concentration of approximately 1.0% of our fleet net book value as of December 31, 2024. We also have a globally diversified customer base with an average country concentration of approximately 1.9% of our fleet net book value as of December 31, 2024.
Our customer base is highly diversified, with an average customer concentration and average country concentration of approximately 1.1% and 2.0% of our fleet net book value as of December 31, 2025, respectively.
For example, certain provisions of the Tax Cuts and Jobs Act that phased into effect in 2022 limit our ability to deduct interest expense from taxable income in future financial statements.
For example, certain provisions of the Tax Cuts and Jobs Act that phased into effect in 2022 and were subsequently modified by recent legislation commonly referred to as the One Big Beautiful Bill Act of 2025 (the “Act”) limit our ability to deduct interest expense from taxable income in future financial statements.
Based on historical rates of airline defaults and bankruptcies, we expect that we will experience additional lessee defaults and bankruptcies in the ordinary course of our business. When a lessee defaults on its lease or files for bankruptcy, we typically incur significant additional costs, including legal and other expenses associated with court or other governmental proceedings.
When a lessee defaults on its lease or files for bankruptcy, we typically incur significant additional costs, including legal and other expenses associated with court or other governmental proceedings.
Accordingly, our or our lessees’ insurance coverage could be insufficient to cover all claims that could be asserted against us arising from the operation of our aircraft.
For example, we and certain of our subsidiaries submitted insurance claims to recover losses relating to aircraft detained in Russia, and certain of such claims remain outstanding and subject to litigation. Accordingly, our or our lessees’ insurance coverage could be insufficient to cover all claims that could be asserted against us arising from the operation of our aircraft.
Accordingly, it is difficult to predict exactly how, and to wha t extent, such actions may impact our business, or the business of our lessees or aircraft manufacturers.
We cannot predict what further actions may ultimately be taken with respect to export controls, tariffs or trade relations between the U.S. and other countries. Accordingly, it is difficult to predict exactly how, and to wha t extent, such actions may impact our business, or the business of our lessees or aircraft manufacturers.
As a result of airframe and engine delays, our orderbook delivery schedule could continue to be subject to material changes and delivery delays are expected to extend beyond 2025. Our leases and purchase agreements with Airbus and Boeing typically provide for cancellation rights starting at one year after the contractual delivery date, regardless of cause.
Our leases and purchase agreements with Airbus and Boeing typically provide for cancellation rights starting at one year after the contractual delivery date, regardless of cause.
While deferrals generally shift the timing of payments to a later period, restructurings and terminations generally permanently reduce our lease revenue. If we perform a significant number of restructurings and terminations, the associated reduction in lease revenue could materially and adversely affect our financial results and cash flows.
While deferrals generally shift the timing of payments to a later period, restructurings and terminations generally permanently reduce our lease revenue.
Any of these factors could cause our lessees to incur higher costs and to generate lower revenues which could adversely affect their ability to make lease payments which in turn could impact our financial results. 18 Table of Contents We have concentrated customer exposure and economic, legal and political risks associated with these lessees, including adverse events involving the regions in which these lessees operate may have an adverse effect on our financial condition.
We have concentrated customer exposure and economic, legal and political risks associated with these lessees, including adverse events involving the regions in which these lessees operate may have an adverse effect on our financial condition.
Our primary competitors are other aircraft leasing companies. The barriers to entry in the aircraft sale and leaseback market are comparatively low, and new entrants with private equity, hedge fund, or other funding sources appear from time to time.
The barriers to entry in the aircraft sale and leaseback market are comparatively low, and new entrants with private equity, hedge fund, or other funding sources appear from time to time. Lease competition is driven by lease rates, aircraft availability dates, lease terms, relationships, aircraft condition, specifications and configuration of the aircraft necessary to meet the customer’s needs.
For example, we have experienced ongoing delivery delays of Airbus and Boeing aircraft and have been advised delays could extend through 2029. Additionally, recent events, including the Boeing labor strike and the FAA’s increased oversight of Boeing’s quality control procedures and constraints placed on 737 MAX program production have resulted in further delivery delays.
Recent events, including the Boeing labor strike and the FAA’s increased oversight of Boeing’s quality control procedures and constraints placed on 737 MAX program production have resulted in delivery delays. Our Airbus deliveries may also be impacted by the residual effects of the Boeing labor strike on the broader aviation supply chain.
Various jurisdictions have announced sustainability initiatives to reduce carbon emissions, explore sustainable aviation fuels, require tracking and disclosure of emissions metrics, or the establishment of sustainability measures and targets.
There are inherent climate-related risks wherever our business is conducted. Changes in market dynamics, stakeholder expectations, local, national and international climate change policies, could disrupt our business and operations. Various jurisdictions have announced sustainability initiatives to reduce carbon emissions, explore sustainable aviation fuels, require tracking and disclosure of emissions metrics, or the establishment of sustainability measures and targets.
Some of our lessees have defaulted on their lease obligations or filed for bankruptcy or otherwise sought protection from creditors (collectively referred to as “bankruptcy”). One of our lessees is subject to bankruptcy proceedings as of February 13, 2025 and lessee bankruptcies may increase in the future.
From time to time, an airline may seek reorganization or protection from creditors under its local laws or may go into liquidation. Some of our lessees have defaulted on their lease obligations or filed for bankruptcy or otherwise sought protection from creditors (collectively referred to as “bankruptcy”).
Our inability to compete successfully with our competitors may impact our ability to execute our long-term strategy. 20 Table of Contents Our lessees may fail to adequately insure our aircraft or fulfill their indemnity obligations, or we may not be able to adequately insure our aircraft, which may result in increased costs and liabilities.
Our lessees may fail to adequately insure our aircraft or fulfill their indemnity obligations, or we may not be able to adequately insure our aircraft, which may result in increased costs and liabilities. When an aircraft is on lease, we do not directly control its operation.
Lease competition is driven by lease rates, aircraft availability dates, lease terms, relationships, aircraft condition, specifications and configuration of the aircraft necessary to meet the customer’s needs. Competition in the used aircraft market is driven by price, the terms of the lease to which an aircraft is subject and the creditworthiness of the lessee, if any.
Competition in the used aircraft market is driven by price, the terms of the lease to which an aircraft is subject and the creditworthiness of the lessee, if any. Our inability to compete successfully with our competitors may impact our ability to execute our long-term strategy.
In turn, this may impact where we can place and deliver our aircraft which may negatively impact our ability to execute on our long-term strategy.
While some trade negotiations are underway, resolution of these trade disputes and associated tariff rates remain uncertain, with unpredictable long-term implications for the global supply chain and economic stability. In turn, this may impact where we can place and deliver our aircraft which may negatively impact our ability to execute on our long-term strategy.
We may not be able to continue, or may elect to discontinue, paying dividends which may adversely affect our stock price.
Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Financing Restrictions Under the Merger Agreement for more information. We may not be able to continue, or may elect to discontinue, paying dividends which may adversely affect our stock price.
The failure of an aircraft or engine manufacturer to meet its delivery obligations to us may negatively impact our ability to grow our fleet and our earnings. The supply of commercial aircraft is dominated by a limited number of airframe and engine manufacturers.
The supply of commercial aircraft is dominated by a limited number of airframe and engine manufacturers.
Persistently elevated interest rates in 2024 increased our borrowing costs, with our composite cost of funds increasing from 3.77% at December 31, 2023 to 4.14% at December 31, 2024. Interest rates that we obtain on our debt financings can fluctuate based on, among other things, changes in views of our credit risk, fluctuations in U.S.
Interest rates that we obtain on our debt financings can fluctuate based on, among other things, changes in views of our credit risk, fluctuations in U.S. Treasury rates and SOFR, as applicable, changes in credit spreads, and the duration of the debt being issued.
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Treasury rates and SOFR, as applicable, changes in credit spreads, and the duration of the debt being issued. Increased interest rates prevailing in the market at the time of our incurrence of new debt will also increase our interest expense.
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Risk Factors Summary Risks relating to the Merger • the inability to complete the Merger because of the failure to receive, on a timely basis or subject to conditions that are not anticipated, the required approvals by governmental or regulatory agencies in connection with the transactions contemplated by the merger agreement; • the occurrence of any event, change or other circumstance that could give rise to the termination of the merger agreement; • the risk that the pendency and uncertainty of the Merger disrupts our business and current plans and operations and potential difficulties in employee retention as a result; • the effect of the announcement of the Merger on our business relationships, operating results and business generally; • certain restrictions on our business activities resulting from the pendency of the Merger; • the restrictions or prohibitions under certain covenants in the merger agreement during the pendency of the Merger that may impact our ability to pursue certain business opportunities, including alternatives to the Merger; • the risk that our Class A common stock price may decline if the Merger is not consummated; and • the risk that the Merger may involve unexpected costs, litigation, liabilities or delays, or the amount of costs, fees, expenses and charges relating to the Merger.
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Certain of our debt agreements contain covenants that impose restrictions on us and our subsidiaries that may limit our flexibility to operate our business. Some of the agreements governing our indebtedness contain financial and non-financial covenants.
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Risks relating to our capital requirements and debt financings • our inability to obtain additional capital on favorable terms, or at all, to acquire aircraft from our orderbook, service our debt obligations and refinance maturing debt obligations, including as a result of the restrictions under the merger agreement on our ability to incur additional debt; • any negative changes in our credit ratings may limit our ability to obtain financing or increase our borrowing costs; and • the restrictions or prohibitions under certain covenants from our debt agreements.
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Our Airbus deliveries may also be impacted by the residual effects of the Boeing labor strike on the broader aviation supply chain.
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Operational risks relating to our business • our inability to generate sufficient returns on our aircraft investments through strategic aircraft acquisitions and profitable leasing; • the failure of an aircraft or engine manufacturer to meet its contractual obligations to us, including or as a result of labor strikes, aviation supply chain constraints, manufacturing flaws, or technical or other difficulties with aircraft or engines before or after delivery; • obsolescence of, or changes in overall demand for, our aircraft; • changes in the value of, and lease rates for, our aircraft, including as a result of aircraft oversupply, manufacturer production levels, our lessees’ failure to maintain our aircraft, inflation, and other factors outside of our control; • impaired financial condition and liquidity of our lessees, including due to lessee defaults and reorganizations, bankruptcies or similar proceedings; • increased competition from other aircraft lessors; • the failure by our lessees to adequately insure our aircraft or fulfill their contractual indemnity obligations to us, or the failure of such insurers to fulfill their contractual obligations; • our inability to satisfy our aircraft acquisition commitments and/or complete our planned aircraft sales; • our exposure to economic, legal and political risks with our lessees, including adverse events involving the regions in which these lessees operate; • death, incapacity or departure of one of our key officers; • the risk of cyber attack or interruption of our IT systems and the loss of information; and • conflicts of interest between us and clients utilizing our fleet management services and our managed fleet investment partners. 15 Table of Contents Macroeconomic and global risks relating to our business • increased tariffs and export and import restrictions on trade; • other events affecting our business or the business of our lessees and aircraft manufacturers or their suppliers that are beyond our or their control, such as the threat or realization of epidemic diseases, natural disasters, terrorist attacks, war or armed hostilities between countries or non-state actors; • the risk of decreased demand or oversupply of aircraft in the industry; • volatility in fuel costs resulting in fluctuating demand for our aircraft; and • changes in exchange rates of foreign currency in relation to the U.S. dollar could negatively impact our lessees’ ability to honor the terms of their leases.
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Obsolescence of certain aircraft may also trigger impairment charges, increase depreciation expense or result in losses related to aircraft asset value guarantees, if we provide such guarantees.
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Regulatory, tax and legal risks relating to our business • changes in the domestic and international regulatory environment, including changes in tax laws and environmental regulations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeRisk Factors in this Annual Report on Form 10-K, including “A cyberattack could lead to a material disruption of our information technology (“IT”) systems or the IT systems of our third-party providers and the loss of business information, which may hinder our ability to conduct our business effectively and may result in lost revenues and additional costs.” 29 Table of Contents
Biggest changeRisk Factors in this Annual Report on Form 10-K, including “A cyberattack could lead to a material disruption of our information technology (“IT”) systems or the IT systems of our third-party providers and the loss of business information, which may hinder our ability to conduct our business effectively and may result in lost revenues and additional costs.” 34 Table of Contents

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following table shows the scheduled lease terminations (for the minimum non-cancellable period which does not include contracted unexercised lease extension options) of our owned fleet as of December 31, 2024: Aircraft Type 2025 2026 2027 2028 2029 Thereafter Total Airbus A220-100 — — — — — 7 7 Airbus A220-300 — — 2 — — 20 22 Airbus A320-200 8 3 1 — 1 10 23 Airbus A320-200neo — — 3 4 3 13 23 Airbus A321-200 1 4 3 6 5 — 19 Airbus A321-200neo — 1 6 7 10 84 108 Airbus A330-200 2 2 — 1 7 1 13 Airbus A330-300 1 1 1 1 1 — 5 Airbus A330-900neo — 1 — — 1 26 28 Airbus A350-900 — 1 1 1 — 14 17 Airbus A350-1000 — — — — — 8 8 Boeing 737-700 2 — — — — — 2 Boeing 737-800 11 14 11 9 8 8 61 Boeing 737-8 MAX — 2 2 4 1 50 59 Boeing 737-9 MAX — — — — 1 29 30 Boeing 777-200ER — — 1 — — — 1 Boeing 777-300ER 1 9 4 6 1 3 24 Boeing 787-9 — 1 2 3 2 18 26 Boeing 787-10 — — — — — 12 12 Embraer E190 — — — — — 1 1 Total 26 39 37 42 41 304 489 Commitments As of December 31, 2024, we had committed to purchase the following new aircraft at an estimated aggregate purchase price (including adjustments for anticipated inflation) of approximately $17.1 billion for delivery as shown below.
Biggest changeThe following table shows the scheduled lease terminations (for the minimum non-cancellable period which does not include contracted unexercised lease extension options) of our owned aircraft as of December 31, 2025, updated through February 12, 2026: Aircraft Type 2026 2027 2028 2029 2030 Thereafter Total Airbus A220-100 — — — — — 8 8 Airbus A220-300 — 2 — — — 31 33 Airbus A320-200 2 1 — 1 — 13 17 Airbus A320-200neo — 3 4 3 3 10 23 Airbus A321-200 1 3 6 5 2 — 17 Airbus A321-200neo 1 6 6 10 8 78 109 Airbus A330-200 (1) — — 3 6 — 4 13 Airbus A330-300 — 1 1 1 1 1 5 Airbus A330-900neo — — — 1 — 27 28 Airbus A350-900 — — — — — 17 17 Airbus A350-1000 — — — — — 8 8 Boeing 737-800 5 8 10 6 2 7 38 Boeing 737-8 MAX — 4 4 1 9 53 71 Boeing 737-9 MAX — — — 1 2 32 35 Boeing 777-200ER — 1 — — — — 1 Boeing 777-300ER — 1 5 2 6 9 23 Boeing 787-9 1 — 3 4 3 15 26 Boeing 787-10 — — — — — 17 17 Embraer E190 — — — — 1 — 1 Total (2) 10 30 42 41 37 330 490 (1) As of December 31, 2025 and 2024, aircraft count includes three and two Airbus A330-200 aircraft classified as freighters, respectively.
New Aircraft Placements The following table, which is subject to change based on Airbus and Boeing delivery delays, shows the number of new aircraft expected to be delivered as of December 31, 2024, along with the lease placements of such aircraft as of February 13, 2025.
New Aircraft Placements The following table, which is subject to change based on Airbus and Boeing delivery delays, shows the number of new aircraft to be delivered as of December 31, 2025, along with the lease placements of such aircraft as of February 12, 2026.
Facilities We lease our principal executive office at 2000 Avenue of the Stars, Suite 1000N, Los Angeles, California 90067, USA. We also lease offices in Hong Kong and Dallas, Texas and own our office in Dublin, Ireland. We believe our current facilities are adequate for our current needs and for the foreseeable future.
Facilities We lease our principal executive office at 2000 Avenue of the Stars, Suite 1000N, Los Angeles, California 90067, USA. We also lease an office in Hong Kong and own our office in Dublin, Ireland. We believe our current facilities are adequate for our current needs and for the foreseeable future. 36 Table of Contents
ITEM 2. PROPERTIES Flight Equipment As of December 31, 2024, we owned 489 aircraft, comprised of 355 narrowbody aircraft and 134 widebody aircraft. Our fleet has a weighted average age of 4.6 years.
ITEM 2. PROPERTIES Flight Equipment As of December 31, 2025, we owned 490 aircraft, comprised of 352 narrowbody aircraft and 138 widebody aircraft. Our fleet has a weighted average age of 4.9 years.
Expected commitment schedule Estimated Delivery Years Aircraft Type 2025 2026 2027 2028 2029 Thereafter Total Airbus A220-100/300 14 2 12 15 3 — 46 Airbus A320/321neo (1) 4 25 47 48 7 — 131 Airbus A330-900neo — 1 — — — — 1 Airbus A350F — — 1 5 1 — 7 Boeing 737-8/9 MAX 20 21 25 4 — — 70 Boeing 787-9/10 8 5 1 — — — 14 Total 46 54 86 72 11 — 269 (1) Our Airbus A320/321neo aircraft orders include seven long-range variants and 49 extra long-range variants.
Risk Factors” in this Annual Report on Form 10-K. 35 Table of Contents Contractual commitment schedule Estimated Delivery Years Aircraft Type 2026 2027 2028 2029 2030 Thereafter Total Airbus A220-100/300 3 8 14 8 — — 33 Airbus A320/321neo (1) 20 38 34 34 — — 126 Airbus A330-900neo 1 — — — — — 1 Boeing 737-8/9 MAX 23 21 2 — — 5 51 Boeing 787-9/10 6 1 — — — — 7 Total (2)(3) 53 68 50 42 — 5 218 (1) Our Airbus A320/321neo aircraft orders include 13 long-range variants and 48 extra long-range variants.
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The tables are subject to change based on Airbus and Boeing delivery delays. As noted below, we expect delivery delays for most of the aircraft in our orderbook. We remain in discussions with Airbus and Boeing to determine the extent and duration of delivery delays; however, we are currently unable to determine the full impact of these delays.
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(2) As of December 31, 2025 and 2024, our owned fleet count included 12 and 30 aircraft classified as flight equipment held for sale, respectively, and 16 and 15 aircraft classified as net investments in sales-type leases, respectively.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations — Our Fleet — Aircraft Delivery Delays” for more information. 30 Table of Contents Contractual commitment schedule Estimated Delivery Years Aircraft Type 2025 2026 2027 2028 2029 Thereafter Total Airbus A220-100/300 14 6 12 12 2 — 46 Airbus A320/321neo (1) 7 23 57 40 4 — 131 Airbus A330-900neo — 1 — — — — 1 Airbus A350F — — 2 4 1 — 7 Boeing 737-7/8/9 MAX 27 20 21 2 — — 70 Boeing 787-9/10 8 5 1 — — — 14 Total (2) 56 55 93 58 7 — 269 (1) Our Airbus A320/321neo aircraft orders include seven long-range variants and 49 extra long-range variants.
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Commitments As of December 31, 2025, we had contractual commitments to acquire a total of 218 new aircraft from Airbus and Boeing for delivery through 2031, with an estimated aggregate commitment (including adjustments for anticipated inflation) of $12.6 billion as shown in the following tables. The tables are subject to change based on Airbus and Boeing delivery delays.
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(2) The table above reflects Airbus and Boeing aircraft delivery delays based on contractual documentation. The table below reflects management’s further refinement of expectations on future deliveries based on facts and circumstances known by management as of February 13, 2025.
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See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Our Fleet — Aircraft Delivery Delays” for more information. For more information on the risks and uncertainties impacting our aircraft deliveries, see “Part I—Item 1A.
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Our expected delivery schedule is subject to a number of factors outside our control, including ongoing delays by Airbus and Boeing for certain aircraft, and we cannot guarantee delivery of any particular aircraft at any specific time notwithstanding our expected commitment schedule. For more information on the risks and uncertainties impacting our aircraft deliveries, see “Part I—Item 1A.
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(2) The table above reflects Airbus and Boeing aircraft delivery delays based on contractual documentation. (3) See section entitled “Proposed Merger” under “Part I—Item 1. Business” above for more information on the Orderbook Transfer and its impact on aircraft that deliver after the effective time of the Merger.
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Risk Factors” in this Annual Report on Form 10-K.
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Airbus and Boeing have expressed their desire to increase production rates on several aircraft types but have not meaningfully increased production because of several factors, including ongoing supply chain constraints and other production issues. See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Our Fleet — Aircraft Delivery Delays” for more information.
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Our aircraft delivery schedule could continue to be subject to material changes, and delivery delays are expected to extend beyond 2025. We remain in discussions with Airbus and Boeing to determine the extent and duration of delivery delays, but we are currently unable to determine the full impact of these delays. See “Item 7.
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Delivery Year Total number of lease placements Number of aircraft in our orderbook % Leased 2026 53 53 100.0 % 2027 67 68 98.5 % 2028 20 50 40.0 % 2029 — 42 — % 2030 — — — % Thereafter — 5 — % Total (1) 140 218 64.2 % (1) See section entitled “Proposed Merger” under “Part I—Item 1.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations — Our Fleet — Aircraft Delivery Delays” for more information. 31 Table of Contents Delivery Year Total number of lease placements Number of aircraft in our orderbook % Leased 2025 46 46 100.0 % 2026 54 54 100.0 % 2027 58 86 67.4 % 2028 8 72 11.1 % 2029 — 11 — % Thereafter — — — % Total 166 269 Our lease commitments for all of the lease placements noted in the table above are binding leases except for two aircraft delivering in 2027.
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Business” above for more information on the Orderbook Transfer and its impact on future committed fleet rentals for aircraft that deliver after the effective time of the Merger. Our lease commitments for all aircraft to be delivered in 2026 are binding leases.
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Our lease commitments for aircraft to be delivered in 2027 are comprised of 63 binding leases and four non-binding letters of intent. Our lease commitments for all aircraft to be delivered in 2028 are binding leases.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeIn addition, from time to time, we may be involved in litigation and claims incidental to the conduct of our business in the ordinary course. Our industry is also subject to scrutiny by government regulators, which could result in enforcement proceedings or litigation related to regulatory compliance matters.
Biggest changeOur industry is also subject to scrutiny by government regulators, which could result in enforcement proceedings or litigation related to regulatory compliance matters. We are not presently a party to any enforcement proceedings or litigation related to regulatory compliance matters.
We are not presently a party to any enforcement proceedings or litigation related to 32 Table of Contents regulatory compliance matters. We maintain insurance policies in amounts and with the coverage and deductibles we believe are adequate, based on the nature and risks of our business, historical experience and industry standards.
We maintain insurance policies in amounts and with the coverage and deductibles we believe are adequate, based on the nature and risks of our business, historical experience and industry standards.
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LEGAL PROCEEDINGS In June 2022, we and certain of our subsidiaries (collectively, the “Plaintiffs”) submitted insurance claims to the insurers on our aviation insurance policies (collectively, the “Plaintiffs’ Insurers”) to recover losses relating to aircraft detained in Russia for which we recorded a net write-off of our interests in our owned and managed aircraft totaling approximately $771.5 million for the year ended December 31, 2022.
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LEGAL PROCEEDINGS On September 1, 2025, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”), with Sumisho Air Lease Corporation Designated Activity Company (formerly known as Gladiatora Designated Activity Company), an Irish private limited company (“Parent”), and Takeoff Merger Sub Inc., a Delaware corporation and an indirect wholly owned subsidiary of Parent (“Merger Sub”), pursuant to which, among other things and subject to the conditions contained in the Merger Agreement, Merger Sub will merge with and into the Company, with the Company surviving as an indirect wholly owned subsidiary of Parent (the “Merger”).
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On December 20, 2022, the Plaintiffs filed suit in the Los Angeles County Superior Court of the State of California seeking recovery of actual damages (subject to proof at trial) and declaratory relief against the Plaintiffs’ Insurers for breach of contract and breach of the covenant of good faith and fair dealing in connection with the Plaintiffs’ previously submitted insurance claims for which a jury trial has been set for April 17, 2025.
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Parent is a new holding company established by Sumitomo Corporation, a Japanese corporation, SMBC Aviation Capital Limited, a company incorporated with limited liability in Ireland, affiliates of Apollo Capital Management, L.P. and affiliates of Brookfield Asset Management Ltd. (collectively, the “Equity Investors”). On October 15, 2025, the Company filed with the U.S.
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Fact and expert discovery are complete. In November 2024, certain Plaintiffs’ Insurers filed motions for summary judgment, which the Plaintiffs opposed in December 2024. A hearing on these motions for summary judgment is set for February 20, 2025.
Added
Securities and Exchange Commission (the “SEC”) a preliminary proxy statement on Schedule 14A (the “Preliminary Proxy Statement”) in connection with the special meeting of the Company’s Class A common stockholders held on December 18, 2025 (the “Special Meeting”) to, among other things, adopt and approve the Merger Agreement.
Removed
On December 21, 2023, certain Plaintiffs received cash insurance settlement proceeds of approximately US$64.9 million in settlement of their insurance claims under S7’s insurance policies in respect of four aircraft in our owned fleet on lease to S7 at the time of Russia’s invasion of Ukraine.
Added
On November 4, 2025, the Company filed with the SEC a definitive proxy statement on Schedule 14A (the “Definitive Proxy Statement”).
Removed
The receipt of these insurance settlement proceeds serves to mitigate, in part, such Plaintiffs’ losses under their aviation insurance policies.
Added
On November 12, 2025, a purported Class A common stockholder of the Company (the “Delaware Plaintiff”) filed a lawsuit against the Company and each member of the Company’s Board of Directors in the Court of Chancery in the State of Delaware (the “Delaware Complaint”). The Delaware Complaint, captioned Bingham v. Air Lease Corp., C.A. No. 2025-1308-BWD (Del.
Removed
On January 19, 2024, certain of the Plaintiffs filed suit in the High Court of Justice, Business & Property Courts of England & Wales, Commercial Court against the Russian airlines’ aviation insurers and reinsurance insurers (collectively, the “Airlines’ Insurers”) seeking recovery under the Russian airlines’ insurance policies for certain aircraft that remain in Russia.
Added
Ch. 2025), asserted claims under Delaware law for breach of fiduciary duties against each member of the Company’s Board of Directors related to alleged materially misleading and/or incomplete disclosures in the Definitive Proxy Statement concerning the Company’s financial projections, the analyses conducted by J.P. Morgan, discussions about post-transaction employment and prior representations by the Company’s legal advisor of Brookfield.
Removed
The lawsuit against the Airlines’ Insurers remains in the early stages and no trial date has been set.
Added
The Delaware Plaintiff also sought a preliminary injunction to prevent the Company from proceeding with holding the Class A common stockholder vote on the Merger Agreement at the Special Meeting.
Removed
We do not believe these matters will have a material adverse effect on our results of operations, financial condition or cash flow, as we recorded a write-off of our entire interest in our owned and managed aircraft detained in Russia during 2022 and any recovery in these lawsuits would be recorded as a gain in our financial statements.
Added
On November 24, 2025, two purported Class A common stockholders of the Company filed separate lawsuits against the Company and each member of the Company’s Board of Directors in the Supreme Court of the State of New York in New York County (the “New York Complaints” and together with the Delaware Complaint, the “Complaints”).
Added
The New York Complaints, captioned Williams v. Air Lease Corp., No. 659969/2025 (N.Y. Sup. Ct. 2025) and Thomas v. Air Lease Corp., No. 659966/2025 (N.Y. Sup.
Added
Ct. 2025), respectively, each asserted claims under New York common law for negligent misrepresentation and concealment and general negligence, concerning the Definitive Proxy Statement, including allegedly misleading and/or incomplete disclosures concerning the Company’s financial projections, the analyses conducted by J.P.
Added
Morgan, discussions about post-transaction employment and concurrent representations by the Company’s financial advisor and its affiliates of Apollo and its affiliates. The New York Complaints also sought to enjoin the Merger until supplemental disclosures to the Definitive Proxy Statement were made.
Added
In addition, subsequent to the Preliminary Proxy Statement filing, the Company also received eleven demand letters from counsel representing purported Class A common stockholders of the Company.
Added
These demand letters alleged that the Preliminary Proxy Statement or the Definitive Proxy Statement violated applicable federal or state law and contained materially misleading and/or incomplete disclosures concerning, among other things, the Company’s financial projections, the analyses conducted by the Company’s financial advisors, the personal or business relationships between the directors and executives of the Company and those of the Equity Investors and the prior representations by the Company’s legal advisor of Brookfield.
Added
These demand letters requested that the Company issue supplemental disclosures to the Definitive Proxy Statement.
Added
In order to reduce the risk of the Complaints delaying the Special Meeting or the closing of the Merger, and to minimize the nuisance and expense of defending against any litigation, and without admitting any liability or wrongdoing, on November 28, 2025, the Company filed a Current Report on Form 8-K to update and supplement the Definitive Proxy Statement with additional disclosures relating to the Merger (the “Supplemental Disclosures”).
Added
Thereafter, the attorneys representing the Class A common stockholders who filed the Complaints acknowledged that the Supplemental Disclosures mooted the claims raised in the Complaints in their entirety and confirmed that they will seek a mootness fee in connection with the Supplemental Disclosures.
Added
The Delaware Complaint was voluntarily dismissed pending such mootness fee demand, while the New York Complaints will remain pending as the mootness fee demand is resolved.
Added
The Company continues to believe that the disclosures in the Definitive Proxy Statement comply fully with all 37 Table of Contents applicable laws, and denies the allegations in the Complaints described above and believes they are without merit.
Added
Nevertheless, resolution of these matters may involve payments by the Company to the Class A common stockholders’ attorneys that filed the Complaints and/or submitted the demand letters. Additionally, from time to time, we may be involved in litigation and claims incidental to the conduct of our business in the ordinary course.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

7 edited+1 added−3 removed3 unchanged
Biggest changeDividends The following table sets forth the dividends declared on the Company’s outstanding Class A common stock for the years ended December 31, 2024, 2023 and 2022: Year Ended December 31, 2024 Year Ended December 31, 2023 Year Ended December 31, 2022 Dividends declared per share $ 0.85 $ 0.81 $ 0.755 The board of directors approved quarterly cash dividends on the Company’s outstanding Class A common stock in 2024 and expects to continue approving a comparable quarterly cash dividend on the Company’s outstanding Class A common stock for the foreseeable future.
Biggest changeDividends The following table sets forth the dividends declared on the Company’s outstanding Class A common stock for the years ended December 31, 2025, 2024, and 2023: Year Ended December 31, 2025 Year Ended December 31, 2024 Year Ended December 31, 2023 Dividends declared per share $ 0.88 $ 0.85 $ 0.81 The board of directors approved quarterly cash dividends on the Company’s outstanding Class A common stock in 2025.
The stock price performance shown in the graph is not necessarily indicative of future stock price performance. 34 Table of Contents Comparison of 5 Year Cumulative Total Return Assumes Initial Investment of $100 December 31, 2024 The foregoing Performance Graph does not constitute soliciting material and shall not be deemed filed, incorporated by reference into or a part of any other filing by the Company (including any future filings) under the Securities Act, or the Exchange Act, except to the extent the Company specifically incorporates such report by reference therein.
The stock price performance shown in the graph is not necessarily indicative of future stock price performance. 39 Table of Contents Comparison of 5 Year Cumulative Total Return Assumes Initial Investment of $100 December 31, 2025 The foregoing Performance Graph does not constitute soliciting material and shall not be deemed filed, incorporated by reference into or a part of any other filing by the Company (including any future filings) under the Securities Act, or the Exchange Act, except to the extent the Company specifically incorporates such report by reference therein.
An investment of $100, with reinvestment of all dividends, is assumed to have been made in our Class A common stock, the 2023 custom benchmarking group, the 2024 custom benchmarking group, the S&P Midcap 400 Index and S&P SmallCap 600 Index on December 31, 2019, and the relative performance of each is tracked through December 31, 2024.
An investment of $100, with reinvestment of all dividends, is assumed to have been made in our Class A common stock, the 2025 custom benchmarking group and S&P SmallCap 600 Index on December 31, 2020, and the relative performance of each is tracked through December 31, 2025.
Performance Graph The graph below compares the 5-year cumulative return of the Company’s Class A common stock, the S&P Midcap 400 Index, the S&P SmallCap 600 Index, the Company’s 2023 custom benchmark group and the Company’s 2024 custom benchmark group.
Performance Graph The graph below compares the 5-year cumulative return of the Company’s Class A common stock, the S&P SmallCap 600 Index and the Company’s 2025 custom benchmark group, which remained unchanged from its 2024 custom benchmark group.
As of December 31, 2024, there were 111,376,884 shares of Class A common stock outstanding. As of February 6, 2025, shares of the Company’s Class A common stock outstanding were held by approximately 61 holders of record.
As of December 31, 2025, there were 112,035,408 shares of Class A common stock outstanding. As of February 3, 2026, shares of the Company’s Class A common stock outstanding were held by approximately 44 holders of record.
This custom benchmarking group reflects companies with similar characteristics to the Company’s business, including exposure to real assets, dependence on a highly skilled management team, credit exposure/underwriting expertise, and significant capital investments. The Company’s 2024 custom benchmark group was updated to remove one company that was acquired and is no longer publicly traded.
This custom benchmarking group reflects companies with similar characteristics to the Company’s business, including exposure to real assets, dependence on a highly skilled management team, credit exposure/underwriting expertise, and significant capital investments. The custom benchmarking group investments are weighted by market capitalization as of December 31, 2020, and adjusted monthly.
The dividend will be paid on April 7, 2025 to holders of record of Class A common stock as of March 18, 2025.
On February 10, 2026, the Company’s board of directors approved a quarterly cash dividend of $0.22 per share on the Company’s outstanding Class A common stock. The dividend will be paid on April 7, 2026 to holders of record of Class A common stock as of March 2, 2026.
Removed
However, the Company’s cash dividend policy can be changed at any time at the discretion of the Company’s board of directors. On February 11, 2025, the Company’s board of directors approved a quarterly cash dividend of $0.22 per share on the Company’s outstanding Class A common stock.
Added
Under the terms of the Merger Agreement, the Company is subject to certain customary operating covenants prior to the Effective Time, including restrictions on paying dividends. However, the Company is permitted to continue paying regular quarterly cash dividends of up to $0.22 per share of Class A common stock.
Removed
In 2024, the Company was added to the S&P SmallCap 600 Index; as such, the Company is electing to remove the S&P Midcap 400 Index from future Performance Graphs.
Removed
The customized benchmarking group investments are weighted by market capitalization as of December 31, 2019, and adjusted monthly.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

136 edited+70 added−47 removed53 unchanged
Biggest changeSee “Results of Operations” below for a discussion of adjusted net income before income taxes and adjusted diluted earnings per share before income taxes as non-GAAP measures and a reconciliation of these measures to net income attributable to common stockholders. 37 Table of Contents The following table sets forth the net book value and percentage of the net book value of our flight equipment subject to operating leases in the indicated regions based on each airline's principal place of business as of December 31, 2024 and 2023: December 31, 2024 December 31, 2023 Region Net Book Value % of Total Net Book Value % of Total (in thousands, except percentages) Europe $ 11,653,668 41.4 % $ 9,881,024 37.7 % Asia Pacific 10,077,621 35.8 % 10,456,435 39.8 % Central America, South America, and Mexico 2,685,098 9.5 % 2,361,089 9.0 % The Middle East and Africa 1,971,448 7.0 % 2,062,420 7.9 % U.S. and Canada 1,782,631 6.3 % 1,470,240 5.6 % Total $ 28,170,466 100.0 % $ 26,231,208 100.0 % The following table sets forth our top five lessees by net book value as of December 31, 2024 and 2023: December 31, 2024 December 31, 2023 Lessee % of Total Lessee % of Total Virgin Atlantic 6.5 % EVA Air 4.9 % Air France-KLM Group 6.2 % Virgin Atlantic 4.8 % ITA 5.6 % Air France-KLM Group 4.3 % Vietnam 4.6 % ITA 4.2 % Aeromexico 4.4 % Vietnam Airlines 4.1 % 38 Table of Contents The following table sets forth the number of aircraft in our owned fleet by aircraft type as of December 31, 2024 and 2023: December 31, 2024 December 31, 2023 Aircraft type Number of Aircraft % of Total Number of Aircraft % of Total Airbus A220-100 7 1.4 % 2 0.4 % Airbus A220-300 22 4.5 % 13 2.8 % Airbus A319-100 — — % 1 0.2 % Airbus A320-200 23 4.7 % 28 6.0 % Airbus A320-200neo 23 4.7 % 25 5.4 % Airbus A321-200 19 3.9 % 23 5.0 % Airbus A321-200neo 108 22.1 % 95 20.6 % Airbus A330-200 (1) 13 2.7 % 13 2.8 % Airbus A330-300 5 1.0 % 5 1.1 % Airbus A330-900neo 28 5.7 % 23 5.0 % Airbus A350-900 17 3.5 % 14 3.0 % Airbus A350-1000 8 1.6 % 7 1.5 % Boeing 737-700 2 0.4 % 3 0.6 % Boeing 737-800 61 12.5 % 73 15.8 % Boeing 737-8 MAX 59 12.1 % 52 11.2 % Boeing 737-9 MAX 30 6.1 % 29 6.3 % Boeing 777-200ER 1 0.2 % 1 0.2 % Boeing 777-300ER 24 4.9 % 24 5.2 % Boeing 787-9 26 5.3 % 25 5.4 % Boeing 787-10 12 2.5 % 6 1.3 % Embraer E190 1 0.2 % 1 0.2 % Total (2) 489 100.0 % 463 100.0 % (1) As of December 31, 2024 and 2023, aircraft count includes two Airbus A330-200 aircraft classified as freighters.
Biggest changeBusiness” above for more information on the Orderbook Transfer and its impact on future committed fleet rentals for aircraft that deliver after the effective time of the Merger. 43 Table of Contents The following table sets forth the net book value and percentage of the net book value of our flight equipment subject to operating leases in the indicated regions based on each airline’s principal place of business as of December 31, 2025 and 2024: December 31, 2025 December 31, 2024 Region Net Book Value % of Total Net Book Value % of Total (in thousands, except percentages) Europe $ 11,356,104 39.1 % $ 11,653,668 41.4 % Asia Pacific 10,602,176 36.5 % 10,077,621 35.8 % Central America, South America, and Mexico 3,114,662 10.7 % 2,685,098 9.5 % The Middle East and Africa 2,254,646 7.8 % 1,971,448 7.0 % U.S. and Canada 1,726,042 5.9 % 1,782,631 6.3 % Total $ 29,053,630 100.0 % $ 28,170,466 100.0 % The following table sets forth our top five lessees by net book value as of December 31, 2025 and 2024: December 31, 2025 December 31, 2024 Lessee % of Total Lessee % of Total Virgin Atlantic 6.1 % Virgin Atlantic 6.5 % Korean Air 6.0 % Air France-KLM Group 6.2 % Air France-KLM Group 5.9 % ITA 5.6 % Aeromexico 5.5 % Vietnam 4.6 % ITA 5.2 % Aeromexico 4.4 % 44 Table of Contents The following table sets forth the number of aircraft in our owned fleet by aircraft type as of December 31, 2025 and 2024: December 31, 2025 December 31, 2024 Aircraft type Number of Aircraft % of Total Number of Aircraft % of Total Airbus A220-100 8 1.6 % 7 1.4 % Airbus A220-300 33 6.7 % 22 4.5 % Airbus A320-200 17 3.5 % 23 4.7 % Airbus A320-200neo 23 4.7 % 23 4.7 % Airbus A321-200 17 3.5 % 19 3.9 % Airbus A321-200neo 109 22.2 % 108 22.1 % Airbus A330-200 (1) 13 2.7 % 13 2.7 % Airbus A330-300 5 1.0 % 5 1.0 % Airbus A330-900neo 28 5.7 % 28 5.7 % Airbus A350-900 17 3.5 % 17 3.5 % Airbus A350-1000 8 1.6 % 8 1.6 % Boeing 737-700 — — % 2 0.4 % Boeing 737-800 38 7.8 % 61 12.5 % Boeing 737-8 MAX 71 14.5 % 59 12.1 % Boeing 737-9 MAX 35 7.1 % 30 6.1 % Boeing 777-200ER 1 0.2 % 1 0.2 % Boeing 777-300ER 23 4.7 % 24 4.9 % Boeing 787-9 26 5.3 % 26 5.3 % Boeing 787-10 17 3.5 % 12 2.5 % Embraer E190 1 0.2 % 1 0.2 % Total (2) 490 100.0 % 489 100.0 % (1) As of December 31, 2025 and 2024, aircraft count includes three and two Airbus A330-200 aircraft classified as freighters, respectively.
We may also redeem shares of the Series B Preferred Stock at our option under certain other limited conditions. The Series B Preferred Stock ranks on a parity with the Series C Preferred Stock and the Series D Preferred Stock.
We may also redeem shares of the Series C Preferred Stock at our option under certain other limited conditions. The Series C Preferred Stock ranks on a parity with the Series B and Series D Preferred Stock.
Treasury plus 2.560% Total 900,000 $ 900,000 (1) The Series B Preferred Stock, Series C Preferred Stock and Series D Preferred Stock each have a redemption price of $1,000.00 per share, plus any declared and unpaid dividends to, but excluding, the redemption date without accumulation of any undeclared dividends. (2) Dividends on preferred stock are discretionary and non-cumulative.
Treasury plus 2.560% (3) Total 900,000 $ 900,000 (1) The Series B Preferred Stock, Series C Preferred Stock and Series D Preferred Stock each have a redemption price of $1,000.00 per share, plus any declared and unpaid dividends to, but excluding, the redemption date without accumulation of any undeclared dividends. (2) Dividends on preferred stock are discretionary and non-cumulative.
Deterioration of 58 future lease rates and the residual values of our aircraft could result in impairment charges which could have a significant impact on our results of operations and financial condition. We record flight equipment at fair value if we determine the carrying value may not be recoverable.
Deterioration of future lease rates and the residual values of our aircraft could result in impairment charges which could have a significant impact on our results of operations and financial condition. We record flight equipment at fair value if we determine the carrying value may not be recoverable.
Our management team evaluates on a quarterly basis the need to perform an impairment test whenever facts or circumstances indicate a potential impairment has occurred. An assessment is performed whenever events or changes in circumstances indicate that the carrying amount of an aircraft may not be recoverable.
Our management team evaluates on a quarterly basis the need to perform an impairment test whenever facts or circumstances indicate a potential impairment has occurred. An assessment is performed whenever events or changes in circumstances indicate that 64 the carrying amount of an aircraft may not be recoverable.
Adjusted net income before income taxes decreased primarily due to higher interest expense, driven by the increase in our composite cost of funds and overall outstanding debt balance, partially offset by the increase in total revenue as discussed above.
Adjusted net income before income taxes decreased primarily due to higher interest expense, driven by the increase in our composite cost of funds and overall outstanding debt balance, partially offset by the increase in revenue as discussed above.
Capital Allocation Strategy We have a balanced approach to capital allocation based on the following priorities, ranked in order of priority: first, investing in modern, in-demand aircraft to profitably grow our core aircraft leasing business while maintaining strong fleet metrics and creating sustainable long-term shareholder value; second, maintaining our investment grade balance sheet utilizing unsecured debt as our primary form of financing; and finally, in line with the aforementioned priorities, returning excess cash to shareholders through our dividend policy as well as regular evaluation of share repurchases, as appropriate.
Capital Allocation Strategy We have a balanced approach to capital allocation based on the following priorities, ranked in order of priority: first, investing in modern, in-demand aircraft to profitably grow our core aircraft leasing business while maintaining strong fleet metrics and creating sustainable long-term shareholder value; second, maintaining our investment grade balance sheet utilizing unsecured debt as our primary form of financing; and finally, in line with the aforementioned priorities, returning excess cash to stockholders through our dividend as well as regular evaluation of share repurchases, as appropriate.
We will pay dividends on the Series D Preferred Stock only when, as and if declared by the board of directors.
We will pay dividends on the Series D Preferred Stock only when, as and if declared by our board of directors.
As of December 31, 2024 and 2023, we had 300,000 shares of 4.65% Fixed Rate Reset Non-Cumulative Perpetual Preferred Stock, Series B (the “Series B Preferred Stock”), $0.01 par value, outstanding, with an aggregate liquidation preference of $300.0 million ($1,000 per share).
As of December 31, 2025 and 2024, we had 300,000 shares of 4.65% Fixed Rate Reset Non-Cumulative Perpetual Preferred Stock, Series B (the “Series B Preferred Stock”), $0.01 par value, outstanding, with an aggregate liquidation preference of $300.0 million ($1,000 per share).
Preferred equity The following table summarizes our preferred stock issued and outstanding as of December 31, 2024 (in thousands, except for share amounts and percentages): Shares Issued and Outstanding as of December 31, 2024 Liquidation Preference as of December 31, 2024 (1) Issue Date Dividend Rate in Effect at December 31, 2024 (2) Next dividend rate reset date Dividend rate after reset date (3) Series B 300,000 $ 300,000 March 2, 2021 4.650 % June 15, 2026 5 Yr U.S.
Preferred equity The following table summarizes our preferred stock issued and outstanding as of December 31, 2025 (in thousands, except for share amounts and percentages): Shares Issued and Outstanding as of December 31, 2025 Liquidation Preference as of December 31, 2025 (1) Issue Date Dividend Rate in Effect at December 31, 2025 (2) Next dividend rate reset date Dividend rate after reset date Series B 300,000 $ 300,000 March 2, 2021 4.650 % June 15, 2026 5 Yr U.S.
The Revolving Credit Facility also requires us to comply with certain financial maintenance covenants including minimum consolidated shareholders’ equity, minimum consolidated unencumbered assets, and an interest coverage test. In addition, the Revolving Credit Facility contains customary events of default.
The Revolving Credit Facility also requires us to comply with certain financial maintenance covenants including minimum consolidated stockholders’ equity, minimum consolidated unencumbered assets, and an interest coverage test. In addition, the Revolving Credit Facility contains customary events of default.
Our airline customers are facing higher operating costs as a result of higher fuel costs, persistently elevated interest rates, inflation, foreign currency risk, ongoing labor shortages and disputes, as well as delays and cancellations caused by the global air traffic control system and airports, although strong air traffic demand has provided a counterbalance to these increased costs.
Our airline customers are facing higher operating costs as a result of persistently elevated interest rates, inflation, tariffs, foreign currency risk, volatility in fuel costs, ongoing labor shortages and disputes, as well as delays and cancellations caused by the global air traffic control system and airports, although strong air traffic demand has provided a counterbalance to these increased costs.
These rental payments are a primary driver of our short and long-term operating cash flow. As of December 31, 2024, our minimum future rentals on non-cancellable operating leases for the next 12 months was $2.6 billion. For further detail on our minimum future rentals for 2026 and thereafter, see Note 7.
These rental payments are a primary driver of our short and long-term operating cash flow. As of December 31, 2025, our minimum future rentals on non-cancellable operating leases for the next 12 months was $2.7 billion. For further detail on our minimum future rentals for 2026 and thereafter, see Note 7.
Lease rates are influenced by several factors above and beyond interest rates, including aircraft demand, supply technicals, supply chain disruptions, environmental initiatives and 42 Table of Contents other factors that may result in a change in lease rates regardless of the interest rate environment and therefore, are difficult to project or forecast.
Lease rates are influenced by several factors above and beyond interest rates, including aircraft demand, supply technicals, supply chain disruptions, environmental initiatives and other factors that may result in a change in lease rates regardless of the interest rate environment and therefore, are difficult to project or forecast.
In addition, our lease agreements generally provide each of us and the lessees with cancellation rights related to certain aircraft delivery delays that typically parallel the cancellation rights in our purchase agreements.
In addition, our lease agreements generally provide each of us and the lessee with cancellation rights related to certain aircraft delivery delays that typically parallel the cancellation rights in our purchase agreements.
We also have the ability to seek debt financing secured by our assets, as well as financings supported through government-guaranteed export credit agencies for future aircraft deliveries. We have also issued preferred stock in recent years and have outstanding preferred stock with an aggregate stated amount of $900.0 million as of February 13, 2025.
We also have the ability to seek debt financing secured by our assets, as well as financings supported through government-guaranteed export credit agencies for future aircraft deliveries. We have also issued preferred stock in recent years and have outstanding preferred stock with an aggregate stated amount of $900.0 million as of February 12, 2026.
We expect the sale of the majority of our aircraft classified as flight equipment held for sale to be completed during 2025.
We expect the sale of the majority of our aircraft classified as flight equipment held for sale to be completed during 2026.
We may also redeem shares of the Series C Preferred Stock at our option under certain other limited conditions.
We may also redeem shares of the Series B Preferred Stock at our option under certain other limited conditions.
The covenants contained in these indentures are subject to certain exceptions and qualifications set forth therein. In addition, the indentures also provide for customary events of default. If any event of default occurs, any amount then outstanding under the relevant indentures may immediately become due and payable.
In addition, the indentures also provide for customary events of default. If any event of default occurs, any amount then outstanding under the relevant 53 indentures may immediately become due and payable. These events of default are subject to certain exceptions and qualifications set forth in the indentures.
The net proceeds from the issuance of commercial paper are expected to be used for general corporate purposes, which may include, among other things, the purchase of commercial aircraft and the repayment of existing indebtedness.
The net proceeds from the issuance of commercial paper are used for general corporate purposes, which may include, among other things, the purchase of commercial aircraft and the repayment of existing indebtedness.
All of our senior unsecured notes issued since 2019 have consisted of Medium-Term Notes, Series A, issued under our Medium-Term Note Program. As of February 13, 2025, we had approximately $18.8 billion remaining capacity under our Medium-Term Note Program.
All of our senior unsecured notes issued since 2019 have consisted of Medium-Term Notes, Series A, issued under our Medium-Term Note Program. As of February 12, 2026, we had approximately $18.8 billion remaining capacity under our Medium-Term Note Program.
The following table, which is subject to change based on Airbus and Boeing delivery delays, shows the number of new aircraft expected to be delivered as of December 31, 2024, along with the lease placements of such aircraft as of February 13, 2025.
The following table, which is subject to change based on Airbus and Boeing delivery delays, shows the number of new aircraft to be delivered as of December 31, 2025, along with the lease placements of such aircraft as of February 12, 2026.
Passenger traffic volume has historically expanded at a faster rate than GDP growth, in part due to the expansion of the global middle class and the ease and affordability of air travel, which we expect to continue.
Passenger traffic volume has historically expanded at a faster rate than global gross domestic product (“GDP”) growth, in part due to the expansion of the global middle class and the ease and affordability of air travel, which we expect to continue.
As of December 31, 2024, we had a globally diversified customer base of 116 airlines in 58 different countries, with over 95% of our business revenues from airlines domiciled outside of the U.S., and we anticipate that most of our revenues in the future will be generated from foreign customers.
As of December 31, 2025, we had a globally diversified customer base of 102 airlines in 53 different countries, with over 95% of our business revenues from airlines domiciled outside of the U.S., and we anticipate that most of our revenues in the future will be generated from foreign customers.
Write-off of Russian fleet, net of recoveries In December 2023, we recognized a net benefit of approximately $67.0 million from the settlement of insurance claims under S7’s insurance policies related to four aircraft previously included in our owned fleet and our equity interest in our managed fleet that were previously on lease to S7.
We expect our depreciation expense to increase as we continue to add aircraft to our fleet. 63 Recoveries of Russian fleet write-off In December 2023, we recognized a net benefit of approximately $67.0 million from the settlement of insurance claims under S7’s insurance policies related to four aircraft previously included in our owned fleet and our equity interest in our managed fleet that were previously on lease to S7.
The actual delivery dates of the aircraft in our commitments table and the expected time for payment of such aircraft are currently expected to differ from our estimates and could be further impacted by the pace at which Airbus and Boeing can deliver aircraft, among other factors.
The actual delivery dates of the aircraft in our commitments table and the expected time for payment of such aircraft could be further impacted by the pace at which Airbus and Boeing can deliver aircraft, among other factors.
Senior unsecured securities (including Medium-Term Note Program) As of December 31, 2024 and 2023, we had $16.0 billion and $16.3 billion in senior unsecured securities outstanding, respectively. Public unsecured notes.
Senior unsecured securities (including Medium-Term Note Program) As of December 31, 2025 and 2024, we had $13.9 billion and $16.0 billion in senior unsecured securities outstanding, respectively. Public unsecured notes.
As of December 31, 2024 and 2023, we had 300,000 shares of 4.125% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series C (the “Series C Preferred Stock”), $0.01 par value, outstanding with an aggregate liquidation preference of $300.0 million ($1,000 per share).
As of December 31, 2025 and 2024, we had 300,000 shares of 6.00% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series D (the “Series D Preferred Stock”), $0.01 par value, outstanding with an aggregate liquidation preference of $300.0 million ($1,000 per share).
The weighted average age of our fleet was 4.6 years and the weighted average lease term remaining was 7.2 years as of December 31, 2024. Our managed fleet was comprised of 60 aircraft as of December 31, 2024 compared to 78 aircraft as of December 31, 2023.
The weighted average age of our fleet was 4.9 years and the weighted average lease term remaining was 7.2 years as of December 31, 2025. Our managed fleet was comprised of 45 aircraft as of December 31, 2025 compared to 60 aircraft as of December 31, 2024.
Interest rate and facility fees are subject to changes in our credit ratings. The Revolving Credit Facility provides for certain covenants, including covenants that limit our subsidiaries’ ability to incur, create, or assume certain unsecured indebtedness, and our subsidiaries’ abilities to engage in certain mergers, consolidations, and asset sales.
The Revolving Credit Facility provides for certain covenants, including covenants that limit our subsidiaries’ ability to incur, create, or assume certain unsecured indebtedness, and our subsidiaries’ abilities to engage in certain mergers, consolidations, and asset sales.
We have a globally diversified customer base comprised of 116 airlines in 58 countries as of December 31, 2024. We continued to maintain a strong lease utilization rate of 100.0% for the year ended December 31, 2024.
We have a globally diversified customer base comprised of 102 airlines in 53 countries as of December 31, 2025. We continued to maintain a strong lease utilization rate of 100% for the year ended December 31, 2025.
During the year ended December 31, 2024, we recognized $169.7 million in gains from the sale of 39 aircraft, compared to $146.4 million in gains from the sale of 25 aircraft for the year ended December 31, 2023.
During the year ended December 31, 2025, we recognized $244.4 million in gains from the sale of 48 aircraft, compared to $169.7 million in gains from the sale of 39 aircraft for the year ended December 31, 2024.
As of December 31, 2024, we had $15.4 billion in aggregate principal amount of senior unsecured notes outstanding, all of which have been issued in SEC-registered offerings and with remaining terms ranging from one month to 7.04 years and bearing interest at fixed rates ranging from 1.875% to 5.95%.
As of December 31, 2025, we had $13.3 billion in aggregate principal amount of senior unsecured notes outstanding, all of which have been issued in SEC-registered offerings and with remaining terms ranging from less than one month to six years and bearing interest at fixed rates ranging from 1.875% to 5.95%.
We have $1.1 billion of aircraft in our sales pipeline 3 , which includes $951.2 million of aircraft classified as flight equipment held for sale as of December 31, 2024 and $177.7 million of aircraft subject to letters of intent 4 .
We have $1.2 billion of aircraft in our sales pipeline 3 , which includes $529.0 million of aircraft classified as flight equipment held for sale as of December 31, 2025 and $692.0 million of aircraft subject to letters of intent 4 .
Our portfolio metrics as of December 31, 2024 and 2023 are as follows: December 31, 2024 December 31, 2023 Net book value of flight equipment subject to operating lease $ 28.2 billion $ 26.2 billion Weighted-average fleet age (1) 4.6 years 4.6 years Weighted-average remaining lease term (1) 7.2 years 7.0 years Owned fleet (2) 489 463 Managed fleet 60 78 Aircraft on order 269 334 Total 818 875 Current fleet contracted rentals $ 18.3 billion $ 16.4 billion Committed fleet rentals $ 11.2 billion $ 14.6 billion Total committed rentals $ 29.5 billion $ 31.0 billion (1) Weighted-average fleet age and remaining lease term calculated based on net book value of our flight equipment subject to operating lease.
Our portfolio metrics as of December 31, 2025 and 2024 are as follows: December 31, 2025 December 31, 2024 Net book value of flight equipment subject to operating lease $ 29.1 billion $ 28.2 billion Weighted-average fleet age (1) 4.9 years 4.6 years Weighted-average remaining lease term (1) 7.2 years 7.2 years Owned fleet (2) 490 489 Managed fleet 45 60 Aircraft on order (3) 218 269 Total 753 818 Current fleet contracted rentals $ 19.6 billion $ 18.3 billion Committed fleet rentals (3) $ 9.3 billion $ 11.2 billion Total committed rentals $ 28.9 billion $ 29.5 billion (1) Weighted-average fleet age and remaining lease term calculated based on net book value of our flight equipment subject to operating lease.
Interest expense Interest expense totaled $709.0 million for the year ended December 31, 2023 compared to $546.2 million for the year ended December 31, 2022. Our interest expense increased due to an increase in our composite cost of funds to 3.77% as compared to 3.07% in the prior year.
Interest expense Interest expense totaled $836.8 million for the year ended December 31, 2024 compared to $709.0 million for the year ended December 31, 2023. Our interest expense increased due to an increase in our composite cost of funds to 4.14% as compared to 3.77% in the prior year.
In addition, factors and trends including increased airline financing needs, OEM supply chain challenges and backlogs, the elevated price of jet fuel, and environmental sustainability objectives impact the commercial aircraft leasing industry in the short-term and may increase the demand for our aircraft.
In addition, factors and trends including increased airline financing needs, OEM supply chain challenges and backlogs, and environmental sustainability objectives impact the commercial aircraft leasing industry in the short-term and may increase the demand for our aircraft. We are monitoring the impact of tariffs on our business.
We ended the year with a total of 489 aircraft in our owned fleet. The net book value of our fleet 1 grew by 7.4% to $28.2 billion as of December 31, 2024 compared to $26.2 billion as of December 31, 2023.
We ended the year with a total of 490 aircraft in our owned fleet. The net book value of our fleet 1 grew by 3.1% to $29.1 billion as of December 31, 2025 compared to $28.2 billion as of December 31, 2024.
We believe leasing will continue to be an attractive form of aircraft financing for airlines because less cash and financing is required for the airlines, lessors maintain key delivery positions, and it provides fleet flexibility while eliminating residual value risk for lessees. Update on Russian Fleet As previously disclosed in our filings with the U.S.
We believe leasing will continue to be an attractive form of aircraft financing for airlines because less cash and financing is required for the airlines, lessors maintain key delivery positions, and it provides fleet flexibility while eliminating residual value risk for lessees.
As of December 31, 2024, we had $170.0 million outstanding under our unsecured revolving credit facility. • Commercial paper program : On January 21, 2025, we established a commercial paper program under which we may issue unsecured commercial paper up to a total of $2.0 billion outstanding at any time, with maturities of up to 397 days from the date of issue.
As of February 12, 2026, we had $750.0 million in outstanding borrowings under our unsecured revolving credit facility. 50 Table of Contents • Commercial paper program : On January 21, 2025, we established a commercial paper program under which we may issue unsecured commercial paper up to a total of $2.0 billion outstanding at any time, with maturities of up to 397 days from the date of issue.
Material Cash Sources and Requirements We believe that we have sufficient liquidity from available cash balances, cash generated from ongoing operations, available commitments under our unsecured revolving credit facility and general ability to access the capital and debt markets for opportunistic debt financings to satisfy the operating requirements of our business through at least the next 12 months.
Material Cash Sources and Requirements We believe that we have sufficient liquidity from available cash balances, cash generated from ongoing operations, available commitments under our unsecured revolving credit facility and commercial paper program to satisfy the operating requirements of our business through at least the next 12 months.
As of February 13, 2025, lenders held revolving commitments totaling approximately $7.5 billion that mature on May 5, 2028, commitments totaling $25.0 million that mature on May 5, 2027, $210.0 million that mature on May 5, 2026 and commitments totaling $25.0 million that mature on May 5, 2025.
As of February 12, 2026, lenders held revolving commitments totaling approximately $8.4 billion. Lenders held revolving commitments totaling approximately $8.0 billion that mature on May 5, 2029, commitments totaling $125.0 million that mature on May 5, 2028, commitments totaling $25.0 million that mature on May 5, 2027 and commitments totaling $210.0 million that mature on May 5, 2026.
The net book value of our flight equipment subject to operating leases increased to $28.2 billion as of December 31, 2024 from a net book value of $26.2 billion as of December 31, 2023.
Our rental of flight equipment revenues increased due to the continued growth of our fleet. The net book value of our flight equipment subject to operating lease increased to $28.2 billion as of December 31, 2024 from a net book value of $26.2 billion as of December 31, 2023.
These events of default are subject to certain exceptions and qualifications set forth in the indentures. On May 6, 2024, we renewed and refreshed our Medium-Term Note Program, under which we may issue, from time to time, up to $20.0 billion (or their U.S. dollar equivalent) of debt securities designated as our Medium-Term Notes, Series A.
On May 6, 2024, we renewed and refreshed our Medium-Term Note Program, under which we may issue, from time to time, up to $20.0 billion (or their U.S. dollar equivalent) of debt securities designated as our Medium-Term Notes, Series A.
Airline reorganizations, liquidations, or other forms of bankruptcies occurring in the industry may include some of our aircraft customers and result in the early return of aircraft or changes in our lease terms.
Airline reorganizations, liquidations, or other forms of bankruptcies occurring in the industry have in the past and may in the future include some of our aircraft customers. Such events have resulted and may in the future result in the early return of aircraft or 48 Table of Contents changes in our lease terms.
We have non-controlling interests in two investment funds in which we own 9.5% of the equity of each fund. We account for our interest in these funds under the equity method of accounting due to our level of influence and involvement in the funds. Also, we manage certain aircraft that we have sold through our Thunderbolt platform.
We account for our interest in these funds under the equity method of accounting due to our level of influence and involvement in the funds. Also, we manage certain aircraft that we have sold through our Thunderbolt platform.
We believe the current airline operating environment is favorably positioned for us and the broader commercial aircraft leasing industry. Factors such as increases in population growth and the size of the global middle class as well as air travel demand, and improved global economic health and development positively affect the long-term performance of the commercial aircraft leasing industry.
Factors such as increases in population growth and the size of the global middle class as well as air travel demand, and improved global economic health and development positively affect the long-term performance of the commercial aircraft leasing industry.
Adjusted net income before income taxes 2 during the year ended December 31, 2024 was $574.2 million or $5.13 per adjusted diluted share, as compared to $733.6 million, or $6.58 per adjusted diluted share, for the year ended December 31, 2023.
Adjusted net income before income taxes For the year ended December 31, 2025, our adjusted net income before income taxes was $718.4 million, or $6.40 per adjusted diluted share, compared to $574.2 million, or $5.13 per adjusted diluted share, for the year ended December 31, 2024.
As of December 31, 2023, we had $15.7 billion in aggregate principal amount of senior unsecured notes outstanding bearing interest at fixed rates ranging from 0.70% to 5.94%.
As of December 31, 2024, we had $15.4 billion in aggregate principal amount of senior unsecured notes outstanding bearing interest at fixed rates ranging from 1.875% to 5.95%.
The following table summarizes our current credit ratings, including our short-term ratings for our commercial paper program: Rating Agency Long-term Debt Short-Term Rating Corporate Rating Outlook Date of Last Ratings Action Kroll Bond Ratings A- K-1 A- Stable March 22, 2024 Standard and Poor’s BBB A-2 BBB Stable November 1, 2024 Fitch Ratings BBB F-3 BBB Stable June 4, 2024 While a ratings downgrade would not result in a default under any of our debt agreements, it could adversely affect our ability to issue debt and obtain new financings, or renew existing financings, and it would increase the interest rate applicable to certain of our financings. 51 Results of Operations Year Ended December 31, 2024 Year Ended December 31, 2023 Year Ended December 31, 2022 (in thousands, except share and per share amounts and percentages) Revenues Rental of flight equipment $ 2,487,955 $ 2,477,607 $ 2,214,508 Aircraft sales, trading, and other 245,702 207,370 102,794 Total revenues 2,733,657 2,684,977 2,317,302 Expenses Interest 781,996 654,910 492,924 Amortization of debt discounts and issuance costs 54,823 54,053 53,254 Interest expense 836,819 708,963 546,178 Depreciation of flight equipment 1,143,761 1,068,772 965,955 Write-off of Russian fleet, net of (recoveries) — (67,022) 771,476 Selling, general, and administrative 185,933 186,015 156,855 Stock-based compensation expense 33,887 34,615 15,603 Total expenses 2,200,400 1,931,343 2,456,067 Income/(loss) before taxes 533,257 753,634 (138,765) Income tax (expense)/benefit (105,553) (139,012) 41,741 Net income/(loss) $ 427,704 $ 614,622 $ (97,024) Preferred stock dividends (55,631) (41,700) (41,700) Net income/(loss) attributable to common stockholders $ 372,073 $ 572,922 $ (138,724) Earnings/(loss) per share of common stock Basic $ 3.34 $ 5.16 $ (1.24) Diluted $ 3.33 $ 5.14 $ (1.24) Weighted-average shares of common stock outstanding Basic 111,325,481 111,005,088 111,626,508 Diluted 111,869,386 111,438,589 111,626,508 Other financial data Pre-tax margin 19.5 % 28.1 % (6.0) % Adjusted net income before income taxes (1) $ 574,205 $ 733,580 $ 659,868 Adjusted pre-tax margin (1) 21.0 % 27.3 % 28.5 % Adjusted diluted earnings per share before income taxes (1) $ 5.13 $ 6.58 $ 5.89 Pre-tax return on common equity 7.4 % 11.8 % (3.0) % Adjusted pre-tax return on common equity (1) 8.9 % 12.1 % 11.0 % 11.0 % (1) Adjusted net income before income taxes (defined as net income/(loss) attributable to common stockholders excluding the effects of certain non-cash items, such as non-cash deemed dividends upon redemption of our Series A preferred stock, one-time or non-recurring items that are not expected to continue in the future, such as net write-offs and recoveries related to our former Russian fleet, and certain items, adjusted pre-tax margin (defined as adjusted net income before income taxes divided by total revenues), adjusted diluted earnings per share before income taxes (defined as adjusted net income before income taxes divided by the weighted average diluted common shares outstanding) and adjusted pre-tax return on common equity (defined as adjusted net income before income taxes divided by average common shareholders’ equity) are measures of operating performance that are not defined by GAAP and should not be considered as an alternative to net income/(loss) attributable to common stockholders, pre-tax margin, earnings/(loss) per share, diluted earnings/(loss) per share and pre-tax return on common equity, or any 52 other performance measures derived in accordance with GAAP.
The following table summarizes our current credit ratings, including our short-term ratings for our commercial paper program: Rating Agency Long-term Debt Short-Term Rating Corporate Rating Outlook Date of Last Long-term Debt and Corporate Ratings Action Kroll Bond Ratings A- K-1 A- Stable September 2, 2025 Standard and Poor’s BBB A-2 BBB Stable September 2, 2025 Fitch Ratings BBB F-3 BBB Negative September 2, 2025 While a ratings downgrade would not result in a default under any of our debt agreements, it could adversely affect our ability to issue debt and obtain new financings, or renew existing financings, and it would increase the interest rate applicable to certain of our financings. 57 Results of Operations Year Ended December 31, 2025 Year Ended December 31, 2024 Year Ended December 31, 2023 (in thousands, except share and per share amounts and percentages) Revenues and other income Rental of flight equipment revenue Lease rentals $ 2,615,364 $ 2,407,506 $ 2,310,347 Maintenance rentals and other receipts 69,155 80,449 167,260 Total rental of flight equipment revenue 2,684,519 2,487,955 2,477,607 Gain on aircraft sales and trading and other income 331,230 245,702 207,370 Total revenues and other income 3,015,749 2,733,657 2,684,977 Expenses Interest 837,761 781,996 654,910 Amortization of debt discounts and issuance costs 52,799 54,823 54,053 Interest expense 890,560 836,819 708,963 Depreciation of flight equipment 1,223,532 1,143,761 1,068,772 Recoveries of Russian fleet write-off (736,409) — (67,022) Selling, general, and administrative 219,443 185,933 186,015 Stock-based compensation expense 48,930 33,887 34,615 Total expenses 1,646,056 2,200,400 1,931,343 Income before taxes 1,369,693 533,257 753,634 Income tax (expense)/benefit (281,306) (105,553) (139,012) Net income $ 1,088,387 $ 427,704 $ 614,622 Preferred stock dividends (44,325) (55,631) (41,700) Net income attributable to common stockholders $ 1,044,062 $ 372,073 $ 572,922 Earnings per share of common stock Basic $ 9.35 $ 3.34 $ 5.16 Diluted $ 9.29 $ 3.33 $ 5.14 Weighted-average shares of common stock outstanding Basic 111,712,160 111,325,481 111,005,088 Diluted 112,330,337 111,869,386 111,438,589 Other financial data Pre-tax margin 45.4 % 19.5 % 28.1 % Adjusted net income before income taxes (1) $ 718,449 $ 574,205 $ 733,580 Adjusted pre-tax margin (1) 23.8 % 21.0 % 27.3 % Adjusted diluted earnings per share before income taxes (1) $ 6.40 $ 5.13 $ 6.58 Pre-tax return on common equity 18.7 % 7.4 % 11.8 % Adjusted pre-tax return on common equity (1) 10.1 % 8.9 % 12.1 % 11.0 % (1) Adjusted net income before income taxes (defined as net income attributable to common stockholders excluding the effects of certain non-cash items, such as non-cash deemed dividends upon redemption of our Series A preferred stock, non-recurring items that are not expected to continue in the future, such as retirement compensation, merger related costs and recoveries related to our former Russian fleet, and certain other items), adjusted pre-tax margin (defined as adjusted net income before income taxes divided by total revenues), adjusted diluted earnings per 58 share before income taxes (defined as adjusted net income before income taxes divided by the weighted average diluted common shares outstanding) and adjusted pre-tax return on common equity (defined as adjusted net income before income taxes divided by average common stockholders’ equity) are measures of operating performance that are not defined by GAAP and should not be considered as an alternative to net income attributable to common stockholders, pre-tax margin, earnings per share, diluted earnings per share and pre-tax return on common equity, or any other performance measures derived in accordance with GAAP.
Securities and Exchange Commission, in June 2022, we and certain of our subsidiaries submitted insurance claims to the insurers on our aviation insurance policies to recover losses relating to aircraft detained in Russia for which we recorded a net write-off of our interests in our owned and managed aircraft totaling approximately $771.5 million for the year ended December 31, 2022.
Update on Russian Fleet In June 2022, we and certain of our subsidiaries (collectively, the “Plaintiffs”) submitted insurance claims to the insurers (collectively, the “C&P Insurers”) on the Plaintiffs’ contingent and possessed insurance policy (the “C&P Policy”) to recover losses relating to aircraft detained in Russia for which we recorded a net write-off of our interests in our owned and managed aircraft totaling approximately $771.5 million for the year ended December 31, 2022.
The International Air Transport Association (“IATA”) reported that passenger traffic was up 10% during 2024 relative to the prior year, primarily due to continued strength in international traffic and healthy continued expansion of domestic traffic globally.
The International Air Transport Association (“IATA”) reported that 2025 passenger traffic was up 5.3% relative to the prior year, primarily due to continued strength in international traffic, offsetting more modest expansion of domestic traffic globally.
Depreciation expense We recorded $1.14 billion in depreciation expense of flight equipment for the year ended December 31, 2024 compared to $1.07 billion for the year ended December 31, 2023. The increase in depreciation expense for 2024 compared to 2023 is primarily attributable to the growth of our fleet, partially offset by aircraft sales activity during the year.
The increase in depreciation expense for 2024 compared to 2023 is primarily attributable to the growth of our fleet, partially offset by aircraft sales activity during the year.
(2) As of December 31, 2024 and 2023, our owned fleet count included 30 and 14 aircraft classified as flight equipment held for sale, respectively, and 15 and 12 aircraft classified as net investments in sales-type leases, respectively, which are both included in Other assets on the Consolidated Balance Sheet. 39 Table of Contents As of December 31, 2024, we had contractual commitments to purchase 269 new aircraft, with an estimated aggregate purchase price (including adjustments for anticipated inflation) of $17.1 billion, for delivery through 2029 as shown in the following tables.
(2) As of December 31, 2025 and 2024, our owned fleet count included 12 and 30 aircraft classified as flight equipment held for sale, respectively, and 16 and 15 aircraft classified as net investments in sales-type leases, respectively. 45 Table of Contents As of December 31, 2025, we had contractual commitments to purchase 218 new aircraft for delivery through 2031, with an estimated aggregate commitment (including adjustments for anticipated inflation) of $12.6 billion, as shown in the following tables.
Our investment-grade corporate and long-term debt credit ratings help us to lower our cost of funds and broaden our access to attractively priced capital.
These investments are accounted for under the cost method of accounting. 56 Credit Ratings Our investment-grade corporate and long-term debt credit ratings help us to lower our cost of funds and broaden our access to attractively priced capital.
Our material cash sources include: • Unrestricted cash: We ended 2024 with $472.6 million in unrestricted cash. • Lease cash flows: We ended 2024 with $29.5 billion in committed minimum future rental payments comprised of $18.3 billion in contracted minimum rental payments on the aircraft in our existing fleet and $11.2 billion in minimum future rental payments related to aircraft which will deliver between 2025 through 2029.
Our material cash sources include: • Unrestricted cash: We ended 2025 with $466.4 million in unrestricted cash. • Lease cash flows: We ended 2025 with $28.9 billion in committed minimum future rental payments comprised of $19.6 billion in contracted minimum rental payments on the aircraft in our existing fleet and $9.3 billion in minimum future rental payments related to aircraft which will deliver from 2026 through 2031.
No settlements were executed in 2024 and as of February 13, 2025, 16 aircraft previously included in our owned fleet remain in Russia. Selling, general, and administrative expenses We recorded selling, general, and administrative expenses of $185.9 million for the year ended December 31, 2024 compared to $186.0 million for the year ended December 31, 2023.
No settlements were executed in 2024. Selling, general, and administrative expenses We recorded selling, general, and administrative expenses of $185.9 million for the year ended December 31, 2024 compared to $186.0 million for the year ended December 31, 2023.
As of December 31, 2023, we had an outstanding balance of $305.5 million in secured debt financings and pledged four aircraft as collateral with a net book value of $445.9 million. All of our secured obligations as of December 31, 2024 and 2023 were recourse in nature to us.
As of December 31, 2024, we had an outstanding balance of $544.6 million in secured debt financings and pledged ten aircraft as collateral with a net book value of $772.7 million. All of our secured obligations as of December 31, 2025 and 2024 were recourse in nature.
The following table shows the reconciliation of the numerator for adjusted pre-tax margin (in thousands, except percentages): Year Ended December 31, 2024 2023 2022 (unaudited) Reconciliation of the numerator for adjusted pre-tax margin (net income/(loss) attributable to common stockholders to adjusted net income before income taxes): Net income/(loss) attributable to common stockholders $ 372,073 $ 572,922 $ (138,724) Amortization of debt discounts and issuance costs 54,823 54,053 53,254 Write-off of Russian fleet, net of (recoveries) — (67,022) 771,476 Stock-based compensation expense 33,887 34,615 15,603 Income tax expense/(benefit) 105,553 139,012 (41,741) Deemed dividend adjustment (a) 7,869 — — Adjusted net income before income taxes $ 574,205 $ 733,580 $ 659,868 Denominator for adjusted pre-tax margin: Total revenues 2,733,657 2,684,977 2,317,302 Adjusted pre-tax margin (b) 21.0 % 27.3 % 28.5 % (a) This adjustment consists of a deemed dividend related to the redemption of our Series A preferred stock.
The following table shows the reconciliation of the numerator for adjusted pre-tax margin (in thousands, except percentages): Year Ended December 31, 2025 2024 2023 (unaudited) Reconciliation of the numerator for adjusted pre-tax margin (net income attributable to common stockholders to adjusted net income before income taxes): Net income attributable to common stockholders $ 1,044,062 $ 372,073 $ 572,922 Amortization of debt discounts and issuance costs 52,799 54,823 54,053 Recoveries of Russian fleet write-off (736,409) — (67,022) Stock-based compensation expense 48,930 33,887 34,615 Retirement compensation expense 9,230 — — Merger related costs 18,531 — — Income tax expense 281,306 105,553 139,012 Deemed dividend adjustment (a) — 7,869 — Adjusted net income before income taxes $ 718,449 $ 574,205 $ 733,580 Denominator for adjusted pre-tax margin: Total revenues 3,015,749 2,733,657 2,684,977 Adjusted pre-tax margin (b) 23.8 % 21.0 % 27.3 % (a) This adjustment consists of a deemed dividend related to the redemption of our Series A preferred stock.
We expect our interest expense will continue to increase as our average debt balance outstanding increases along with our composite cost of funds. Depreciation expense We recorded $1.1 billion in depreciation expense of flight equipment for the year ended December 31, 2023 compared to $1.0 billion for the year ended December 31, 2022.
We expect our interest expense will continue to increase as our average debt balance outstanding increases with the growth of our fleet based on prevailing interest rates. Depreciation expense We recorded $1.14 billion in depreciation expense of flight equipment for the year ended December 31, 2024 compared to $1.07 billion for the year ended December 31, 2023.
The residual impacts of the Boeing labor strike have impacted and may continue to impact the broader aviation supply chain. Our purchase agreements with Airbus and Boeing generally provide each of us and the manufacturers with cancellation rights for delivery delays starting at one year after the original contractual delivery date, regardless of cause.
Our purchase agreements with Airbus and Boeing generally provide each of us and the manufacturers with cancellation rights for delivery delays starting at one year after the original contractual delivery date, regardless of cause.
Liquidity and Capital Resources Overview We ended 2024 with available liquidity of approximately $8.1 billion which was comprised of unrestricted cash of $472.6 million and undrawn balances under our unsecured revolving credit facility of $7.6 billion.
Liquidity and Capital Resources Overview We ended 2025 with available liquidity of approximately $7.5 billion, which was comprised of unrestricted cash of $466.4 million and approximately $7.0 billion in undrawn balances under our unsecured revolving credit facility, net of $1.4 billion in commercial paper borrowings.
We continue to have significant claims against our aviation insurance carriers and will continue to vigorously pursue all available insurance claims and our related insurance litigation, and all rights and remedies therein. Collection, timing and amounts of any future insurance and related recoveries and the outcome of our ongoing insurance litigation remain uncertain at this time.
The Plaintiffs continue to have claims against certain Airlines’ Insurers in the London Litigation and will continue to vigorously pursue all available insurance claims and related insurance litigation, and all rights and remedies therein. Collection, timing and amounts of any additional insurance and related recoveries in the London Litigation remain uncertain at this time.
We ended 2024 with total debt outstanding of $20.4 billion, of which 79.0% was at a fixed rate and 97.3% of which was unsecured, and in the aggregate, our composite cost of funds was 4.14%.
We ended 2025 with total debt outstanding of $19.9 billion, of which 76.8% was at a fixed rate and 97.5% was unsecured, and in the aggregate, our composite cost of funds was 4.15%.
We ended 2024 with $29.5 billion in committed minimum future rental payments, consisting of $18.3 billion in contracted minimum rental payments on the aircraft in our existing fleet and $11.2 billion in minimum future rental payments related to aircraft which will deliver between 2025 through 2029.
We ended 2025 with $28.9 billion in committed minimum future rental payments, consisting of $19.6 billion in contracted minimum rental payments on the aircraft in our existing fleet and $9.3 billion in minimum future rental payments related to aircraft which will deliver from 2026 through 2031.
International traffic in 2024 rose 14% relative to the prior year, benefiting from robust continued international travel expansion in the Asia Pacific region, as well as strong expansion in most other major international markets reported by IATA. Global domestic traffic rose 6% during 2024 as compared to the prior year, remaining above the pace of global GDP expansion.
International traffic rose 7.1% in 2025 as compared to the prior year, benefiting from robust continued international travel expansion in the Asia Pacific region, as well as strong expansion in most other major international markets reported by IATA.
(b) Adjusted pre-tax margin is adjusted net income before income taxes divided by total revenues 53 The following table shows the reconciliation of the numerator for adjusted diluted earnings per share before income taxes (in thousands, except share and per share amounts): Year Ended December 31, 2024 2023 2022 (unaudited) Reconciliation of the numerator for adjusted diluted earnings per share (net income/(loss) attributable to common stockholders to adjusted net income before income taxes): Net income/(loss) attributable to common stockholders $ 372,073 $ 572,922 $ (138,724) Amortization of debt discounts and issuance costs 54,823 54,053 53,254 Write-off of Russian fleet, net of (recoveries) — (67,022) 771,476 Stock-based compensation expense 33,887 34,615 15,603 Income tax expense/(benefit) 105,553 139,012 (41,741) Deemed dividend adjustment 7,869 — — Adjusted net income before income taxes $ 574,205 $ 733,580 $ 659,868 Denominator for adjusted diluted earnings per share: Weighted-average diluted common shares outstanding 111,869,386 111,438,589 111,626,508 Potentially dilutive securities, whose effect would have been anti-dilutive — — 361,186 Adjusted weighted-average diluted common shares outstanding 111,869,386 111,438,589 111,987,694 Adjusted diluted earnings per share before income taxes (c) $ 5.13 $ 6.58 $ 5.89 (c) Adjusted diluted earnings per share before income taxes is adjusted net income before income taxes divided by adjusted weighted-average diluted common shares outstanding 54 The following table shows the reconciliation of pre-tax return on common equity to adjusted pre-tax return on common equity (in thousands, except percentages): Year Ended December 31, 2024 2023 2022 (unaudited) Reconciliation of the numerator for adjusted pre-tax return on common equity (net income/(loss) attributable to common stockholders to adjusted net income before income taxes): Net income/(loss) attributable to common stockholders $ 372,073 $ 572,922 $ (138,724) Amortization of debt discounts and issuance costs 54,823 54,053 53,254 Write-off of Russian fleet, net of (recoveries) — (67,022) 771,476 Stock-based compensation expense 33,887 34,615 15,603 Income tax expense/(benefit) 105,553 139,012 (41,741) Deemed dividend adjustment 7,869 — — Adjusted net income before income taxes $ 574,205 $ 733,580 $ 659,868 Reconciliation of denominator for pre-tax return on common equity to adjusted pre-tax return on common equity: Common shareholders' equity as of beginning of the period $ 6,310,038 $ 5,796,363 $ 6,158,568 Common shareholders' equity as of end of the period $ 6,632,626 $ 6,310,038 $ 5,796,363 Average common shareholders' equity $ 6,471,332 $ 6,053,201 $ 5,977,466 Adjusted pre-tax return on common equity (d) 8.9 % 12.1 % 11.0 % (d) Adjusted pre-tax return on common equity is adjusted net income before income taxes divided by average common shareholders’ equity 2024 Compared to 2023 Rental of flight equipment revenue During the year ended December 31, 2024, we recorded $2.49 billion in rental revenue, which included amortization expense related to initial direct costs, net of overhaul revenue of $21.4 million, as compared to $2.48 billion in rental revenue, which included overhaul revenue, net of amortization expense related to initial direct costs of $91.9 million, for the year ended December 31, 2023.
(b) Adjusted pre-tax margin is adjusted net income before income taxes divided by total revenues. 59 The following table shows the reconciliation of the numerator for adjusted diluted earnings per share before income taxes (in thousands, except share and per share amounts): Year Ended December 31, 2025 2024 2023 (unaudited) Reconciliation of the numerator for adjusted diluted earnings per share (net income attributable to common stockholders to adjusted net income before income taxes): Net income attributable to common stockholders $ 1,044,062 $ 372,073 $ 572,922 Amortization of debt discounts and issuance costs 52,799 54,823 54,053 Recoveries of Russian fleet write-off (736,409) — (67,022) Stock-based compensation expense 48,930 33,887 34,615 Retirement compensation expense 9,230 — — Merger related costs 18,531 — — Income tax expense 281,306 105,553 139,012 Deemed dividend adjustment — 7,869 — Adjusted net income before income taxes $ 718,449 $ 574,205 $ 733,580 Denominator for adjusted diluted earnings per share: Weighted-average diluted common shares outstanding 112,330,337 111,869,386 111,438,589 Adjusted diluted earnings per share before income taxes (c) $ 6.40 $ 5.13 $ 6.58 (c) Adjusted diluted earnings per share before income taxes is adjusted net income before income taxes divided by adjusted weighted-average diluted common shares outstanding. 60 The following table shows the reconciliation of pre-tax return on common equity to adjusted pre-tax return on common equity (in thousands, except percentages): Year Ended December 31, 2025 2024 2023 (unaudited) Reconciliation of the numerator for adjusted pre-tax return on common equity (net income attributable to common stockholders to adjusted net income before income taxes): Net income attributable to common stockholders $ 1,044,062 $ 372,073 $ 572,922 Amortization of debt discounts and issuance costs 52,799 54,823 54,053 Recoveries of Russian fleet write-off (736,409) — (67,022) Stock-based compensation expense 48,930 33,887 34,615 Retirement compensation expense 9,230 — — Merger related costs 18,531 — — Income tax expense 281,306 105,553 139,012 Deemed dividend adjustment — 7,869 — Adjusted net income before income taxes $ 718,449 $ 574,205 $ 733,580 Reconciliation of the denominator for pre-tax return on common equity to adjusted pre-tax return on common equity: Common stockholders’ equity as of beginning of the period $ 6,632,626 $ 6,310,038 $ 5,796,363 Common stockholders’ equity as of end of the period $ 7,572,756 $ 6,632,626 $ 6,310,038 Average common stockholders’ equity $ 7,102,691 $ 6,471,332 $ 6,053,201 Adjusted pre-tax return on common equity (d) 10.1 % 8.9 % 12.1 % (d) Adjusted pre-tax return on common equity is adjusted net income before income taxes divided by average common stockholders’ equity. 2025 Compared to 2024 Lease rentals During the year ended December 31, 2025, we recorded $2.6 billion in lease rental revenue, which included amortization expense related to initial direct costs of $93.5 million as compared to $2.4 billion in lease rental revenue, which included amortization expense related to initial direct costs of $101.8 million for the year ended December 31, 2024.
The final maturity for the facility is May 2028, although we expect to refinance this facility in advance of that date. The facility contains standard investment grade covenants and does not condition our ability to borrow on the lack of a material adverse effect on us or the general economy.
The facility contains standard investment grade covenants and does not condition our ability to borrow on the lack of a material adverse effect on us or the general economy.
Our senior unsecured notes also require us to offer to purchase all of the notes at a purchase price equal to 101% of the principal amount of the notes, plus accrued and unpaid interest if a “change of control repurchase event” (as defined in the applicable indenture or supplemental indenture) occurs. 47 The indentures that govern our senior unsecured notes requires us to comply with certain covenants, including restrictions on our ability to (i) incur liens on assets and (ii) merge, consolidate or transfer all or substantially all of our assets.
Our senior unsecured notes also require us to offer to purchase all of the notes at a purchase price equal to 101% of the principal amount of the notes, plus accrued and unpaid interest if a “change of control repurchase event” (as defined in the applicable indenture or supplemental indenture) occurs.
The term loan contains customary covenants and events of default consistent with our Revolving Credit Facility. 48 In addition, in 2024, we entered into six other unsecured term facilities, with aggregate commitments totaling $965.0 million with terms of one to five years, bearing interest at a floating rate of one-month Term SOFR plus 1.02% to one-month Term SOFR plus 1.40%.
The term loan contains customary covenants and events of default consistent with our Revolving Credit Facility. 54 In addition, during the year ended December 31, 2025, we also entered into three other unsecured term facilities, with aggregate commitments totaling $550.0 million with terms ranging between one to two years, bearing interest at a floating rate between one-month SOFR plus 1.00% and one-month SOFR plus 1.15% plus a credit spread adjustment of 0.10%.
As of December 31, 2023, we had total debt outstanding of 43 Table of Contents $19.4 billion, of which 84.7% was at a fixed rate and 98.4% of which was unsecured, and in the aggregate, our composite cost of funds was 3.77%.
As of December 31, 2025, we had total debt outstanding of $19.9 billion, of which 76.8% was at a fixed rate and 97.5% was unsecured, and in the aggregate, our composite cost of funds was 4.15%.
As of December 31, 2024, we had $1.25 billion in borrowings outstanding under the term loan. In December 2024, we and a subsidiary entered into a $966.5 million unsecured term loan with a three-year maturity bearing interest at one-month Term SOFR plus a margin of 1.125%, subject to adjustment based on our credit rating.
In December 2024, we entered into a $966.5 million unsecured term loan with a three-year maturity bearing interest at one-month Term SOFR plus a margin of 1.125%, subject to adjustment based on our credit rating. In April 2025, pursuant to the terms of the loan agreement, we exercised our option for additional commitments totaling $33.5 million.
Treasury Rate as of the applicable reset dividend determination date plus a spread of 2.560% per reset period from December 15, 2029 and reset every five years and payable quarterly in arrears; provided, that the dividend rate per annum during any reset period will not reset below 6.00% (which equals the initial dividend rate per annum on the Series D Preferred Stock).
Treasury Rate as of the applicable reset dividend determination date plus a spread of 2.560% per reset period from December 15, 2029 and reset every five years and payable quarterly in arrears.
A shift in monetary policy in the United States and other countries beginning in 2022 resulted in rapid interest rate increases over a relatively short period of time and many are predicting that rates may remain elevated despite rate cuts made in late 2024 by the FOMC.
A shift in monetary policy in the United States and other countries beginning in 2022 resulted in rapid interest rate increases over a relatively short period of time.
As a result, the timing of our contractual purchase commitments shown in the table above may not reflect when the aircraft investments are actually made. For 2025, we currently expect to make between $3.0 billion to $3.5 billion in aircraft investments.
As a result, the timing of our contractual purchase commitments shown in the table above may not reflect when the aircraft investments are actually made. We anticipate our total aircraft investments for the full year 2026 to be between $3.0 billion and $4.0 billion, which may be subject to change due to the pendency of the Merger.
These dates can change for a variety of reasons, however for the last several years, manufacturing delays have significantly impacted the planned purchases of our aircraft on order with both Airbus and Boeing. The FAA has continued to enforce a cap on Boeing’s 737 MAX production until quality control issues are resolved.
These dates can change for a variety of reasons, however for the last several years, manufacturing delays have significantly impacted the planned purchases of our aircraft on order with both Airbus and Boeing. We have agreed to revised contractual delivery dates for our Airbus and Boeing aircraft.
During the year ended December 31, 2024, we purchased 65 new aircraft from Airbus and Boeing and sold 39 aircraft. We ended the period with a total of 489 aircraft in our owned fleet. As of December 31, 2024, the weighted average fleet age and weighted average remaining lease term of our fleet were 4.6 years and 7.2 years, respectively.
We ended the period with a total of 490 aircraft in our owned fleet. As of December 31, 2025, the weighted average fleet age and weighted average remaining lease term of our fleet were 4.9 years and 7.2 years, respectively. We also managed 45 aircraft as of December 31, 2025.
The net book value of our flight equipment subject to operating leases increased to $26.2 billion as of December 31, 2023 from a net book value of $24.5 billion as of December 31, 2022. The increase in rental revenues was primarily driven by the continued growth in our fleet and higher end of lease revenue.
Our lease rental revenues increased primarily due to the continued growth of our fleet by net book value and an increase in our portfolio yield. The net book value of our flight equipment subject to operating lease increased to $29.1 billion as of December 31, 2025 from a net book value of $28.2 billion as of December 31, 2024.
Contractual commitment schedule Estimated Delivery Years Aircraft Type 2025 2026 2027 2028 2029 Thereafter Total Airbus A220-100/300 14 6 12 12 2 — 46 Airbus A320/321neo (1) 7 23 57 40 4 — 131 Airbus A330-900neo — 1 — — — — 1 Airbus A350F — — 2 4 1 — 7 Boeing 737-7/8/9 MAX 27 20 21 2 — — 70 Boeing 787-9/10 8 5 1 — — — 14 Total (2) 56 55 93 58 7 — 269 (1) Our Airbus A320/321neo aircraft orders include seven long-range variants and 49 extra long-range variants.
Contractual commitment schedule Estimated Delivery Years Aircraft Type 2026 2027 2028 2029 2030 Thereafter Total Airbus A220-100/300 3 8 14 8 — — 33 Airbus A320/321neo (1) 20 38 34 34 — — 126 Airbus A330-900neo 1 — — — — — 1 Boeing 737-8/9 MAX 23 21 2 — — 5 51 Boeing 787-9/10 6 1 — — — — 7 Total (2)(3) 53 68 50 42 — 5 218 (1) Our Airbus A320/321neo aircraft orders include 13 long-range variants and 48 extra long-range variants.
Unsecured syndicated revolving credit facility As of December 31, 2024 and 2023, we had $0.2 billion and $1.1 billion, respectively, outstanding under our unsecured syndicated revolving credit facility (the “Revolving Credit Facility”). Borrowings under the Revolving Credit Facility are used to finance our working capital needs in the ordinary course of business and for other general corporate purposes.
Borrowings under the Revolving Credit Facility are used to finance our working capital needs in the ordinary course of business and for other general corporate purposes.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeTo partially mitigate the risk of an increasing interest rate environment between the lease signing date and the delivery date of the aircraft, a majority of our forward lease contracts have manufacturer escalation protection and/or interest rate adjusters which would adjust the final lease rate upward or downward based on changes in the consumer price index or certain benchmark interest rates, respectively, at the time of delivery of the aircraft as compared to the lease signing date, subject to an outside limit on such adjustments.
Biggest changeTo partially mitigate the risk of an increasing interest rate environment between the lease signing date and the delivery date of the aircraft, a majority of our forward lease contracts have manufacturer escalation protection and/or interest rate adjusters which would adjust the final lease rate upward or downward based on changes in the consumer price index or certain benchmark interest rates, respectively, at the time of delivery of the aircraft as compared to the lease signing date, subject to an outside limit on such adjustments. 65 Foreign Exchange Rate Risk We attempt to minimize currency and exchange risks by entering into aircraft purchase agreements and a majority of lease agreements and debt agreements with U.S. dollars as the designated payment currency.
However, many of our lessees are exposed to currency risk due to the fact that they earn revenues in their local currencies 59 while a significant portion of their liabilities and expenses are denominated in U.S. dollars, including their lease payments to us, as well as fuel, debt service, and other expenses.
However, many of our lessees are exposed to currency risk due to the fact that they earn revenues in their local currencies while a significant portion of their liabilities and expenses are denominated in U.S. dollars, including their lease payments to us, as well as fuel, debt service, and other expenses.
Additionally, we have outstanding preferred stock with an aggregate stated amount of $900.0 million as of December 31, 2024 which will reset the dividends to a new fixed rate based on the then-applicable treasury rate after five years from initial issuance and every five years thereafter.
Additionally, we have outstanding preferred stock with an aggregate stated amount of $900.0 million as of December 31, 2025, which will reset the dividends to a new fixed rate based on the then-applicable treasury rate after five years from initial issuance and every five years thereafter.
For the year ended December 31, 2024, more than 95% of our revenues were derived from customers who have their principal place of business outside the U.S. and most of our leases’ designated payment currency is U.S. dollars.
For the year ended December 31, 2025, more than 95% of our revenues were derived from customers who have their principal place of business outside the U.S. and most of our leases’ designated payment currency is U.S. dollars.
The ability of our lessees to make lease payments to us in U.S. dollars may be adversely impacted in the event of an appreciating U.S. dollar. 60
The ability of our lessees to make lease payments to us in U.S. dollars may be adversely impacted in the event of an appreciating U.S. dollar. 66
If the composite interest rate on our outstanding floating rate debt was to increase by 1.0%, we would expect to incur additional annual interest expense on our existing indebtedness of approximately $42.8 million and $29.6 million as of December 31, 2024 and 2023, respectively, each on an annualized basis, which would put downward pressure on our operating margins.
If the composite interest rate on our outstanding floating rate debt was to increase by 1.0%, we would expect to incur additional annual interest expense on our existing indebtedness of approximately $46.0 million and $42.8 million as of December 31, 2025 and 2024, respectively, each on an annualized basis, which would put downward pressure on our operating margins.
We periodically assess our unhedged foreign currency risk and may employ hedging strategies in the future to mitigate any potential adverse effects. Approximately 6.1% and 3.5% of our debt obligations were denominated in foreign currency as of December 31, 2024 and December 31, 2023, respectively; however, the exposure of such debt has been effectively hedged. See Note 13.
We periodically assess our unhedged foreign currency risk and may employ hedging strategies in the future to mitigate any potential adverse effects. Approximately 6.8% and 6.1% of our debt obligations were denominated in foreign currency as of December 31, 2025 and 2024, respectively; however, the exposure of such debt has been effectively hedged. See Note 15.
We have some exposure to changing interest rates as a result of our floating-rate debt, primarily from our Revolving Credit Facility and unsecured term loans. As of December 31, 2024 and 2023, we had $4.3 billion and $3.0 billion, in floating-rate debt outstanding, respectively.
We have some exposure to changing interest rates as a result of our floating-rate debt, primarily from our Revolving Credit Facility, other revolving credit facilities and unsecured term loans. As of December 31, 2025 and 2024, we had $4.6 billion and $4.3 billion, in floating-rate debt outstanding, respectively.
These investments are not currently hedged and require remeasurement as of the end of each period, exposing us to fluctuations in exchange rates that could impact our financial results and cash flows. During the year ended December 31, 2024, we incurred a $5.6 million loss resulting from currency fluctuation based on these investments.
These investments are not currently hedged and require remeasurement as of the end of each period, exposing us to fluctuations in exchange rates that could impact our financial results and cash flows. During the year ended December 31, 2025, we recorded a $19.4 million gain resulting from currency fluctuation based on these investments.
Approximately 0.4% and 0.3% of our lease revenues were denominated in foreign currency as of December 31, 2024 and 2023, respectively. Additionally, some of our net investments in sales-type leases, which represent 0.6% and 0.2% of our total assets as of December 31, 2024 and 2023, respectively, were denominated in foreign currency.
Additionally, some of our net investments in sales-type leases, which represent 0.7% and 0.6% of our total assets as of December 31, 2025 and 2024, respectively, were denominated in foreign currency.
Removed
Foreign Exchange Rate Risk We attempt to minimize currency and exchange risks by entering into aircraft purchase agreements and a majority of lease agreements and debt agreements with U.S. dollars as the designated payment currency. Thus, most of our revenue and expenses are denominated in U.S. dollars.
Added
Thus, most of our revenue and expenses are denominated in U.S. dollars. Approximately 0.3% and 0.4% of our lease revenues were denominated in foreign currency as of December 31, 2025 and 2024, respectively.

Other AL 10-K year-over-year comparisons