Surf Air Mobility Q2 2026 Earnings: Charter Growth Lifts Revenue as Losses Persist

Surf Air Mobility (NYSE: SRFM) reported Q2 2026 revenue of $29.5 million, up 8% from $27.4 million a year earlier, while GAAP diluted loss per share narrowed to $0.29 from $1.34. Surf On Demand private charter revenue more than doubled and offset a decline in scheduled service revenue, but the operating and adjusted EBITDA losses widened amid elevated fuel costs and weather-related cancellations in Hawaii.

Core Financial Results

Revenue for the quarter ended June 30, 2026 reached the high end of management’s $27 million to $30 million guidance range. The $10.5 million adjusted EBITDA loss was within guidance, but at the widest-loss end of the company’s $8.5 million to $10.5 million range.

Profitability did not improve alongside revenue. Cost of revenue increased about 22%, substantially faster than the 8% revenue gain, while the operating loss widened approximately 18%.

Adjusted EBITDA is a non-GAAP measure that excludes items including stock-based compensation, fair-value changes in financial instruments, restructuring costs and certain other expenses.

Business and Segment Performance

Surf On Demand was the principal growth driver. Private charter revenue rose 101% to $12.1 million, representing approximately 41% of total quarterly revenue. Departures increased about 67%, while revenue per flight rose 25% as the business shifted toward larger aircraft and longer flights.

The charter operation recorded its highest revenue and flight volume since inception. Cargo, Wholesale and Powered by Surf On Demand accounted for approximately 14% of private charter revenue in the first half of 2026 and were described as gross-margin positive. That figure is a six-month measure rather than a Q2-only result.

Scheduled service revenue declined 19% to $17.4 million as the company continued to rationalize its route network. Within the airline operation, however, Mokulele Airlines revenue increased about 7%, with more than 10,000 departures, up 3%. Surf Air Mobility ended the quarter with a 98% controllable completion factor, 88% on-time arrivals and 83% on-time departures.

SurfOS also moved into early commercial deployment. Wheels Up became the first enterprise customer for BrokerOS under a contract worth up to $12 million over its initial three-year term. The company expanded its Palantir partnership and plans to launch OperatorOS and OwnerOS commercially in Q4 2026. The contract value should not be interpreted as Q2 revenue because the release did not indicate that the full amount had been recognized.

Profitability, Liquidity, and Balance Sheet

The gap between revenue and reported cost of revenue, excluding depreciation and amortization, fell to approximately $0.1 million from $3.4 million a year earlier. Management attributed adjusted EBITDA pressure to higher fuel costs and weather-related cancellations in Hawaii, partly offset by airline cost controls and more cost-efficient SurfOS development.

Technology and development expense declined to $1.8 million from $2.7 million, while general and administrative expense decreased to $11.5 million from $12.6 million. Those savings were partly countered by sales and marketing expense, which increased to $3.1 million from $1.5 million.

Cash increased to $18.4 million at June 30 from $12.7 million at the end of 2025. However, restricted cash fell to $55,000 from $10.1 million, leaving combined cash and restricted cash at approximately $18.5 million versus $22.8 million. Current assets totaled $41.3 million, compared with $157.8 million of current liabilities, and shareholders’ deficit remained negative at $42.5 million.

After quarter-end, Surf Air Mobility refinanced its senior secured convertible note into a $17 million convertible note due in 2027 and a $30 million non-convertible secured term note due in 2028. The transaction reduced existing convertible principal by 64% and monthly cash amortization payments by up to 50%. The company also entered into a $21.6 million aircraft-backed loan, with a second $14 million funding expected in August 2026.

The Narrower Per-Share Loss Did Not Reflect a Lower Net Loss

The improvement in loss per share was mainly a denominator effect rather than an improvement in total earnings. Net loss remained nearly unchanged at $28.1 million, while the weighted-average diluted share count rose from 20.9 million to 98.4 million.

Shares outstanding also increased from 73.1 million at December 31, 2025 to 119.1 million at June 30, 2026, an increase of approximately 63%. The refinancing reduced some potential future dilution by shifting part of the debt into a non-convertible instrument, but a $17 million convertible note remains.

Guidance

Surf Air Mobility issued Q3 guidance calling for higher revenue and a narrower adjusted EBITDA loss than in Q2. It also reaffirmed its current full-year 2026 ranges, including an adjusted EBITDA outlook that management said was approximately 40% better than an earlier loss forecast.

Management expects the adjusted EBITDA loss to narrow further in Q4. It also expects airline operations to be the company’s most profitable business area during the second half, supported by fleet modernization and OperatorOS-enabled efficiencies.

Management Commentary

Management characterized the company as moving from the foundational stage of its transformation plan into an expansion phase. Its priorities now include growing private charter and SurfOS revenue while continuing to improve airline operating efficiency.

CFO Oliver Reeves said the company is exiting a heavier capital-expenditure cycle and expects free-cash-flow conversion to improve. That outlook depends on operating improvements, lower debt amortization and the execution of the post-quarter financing plan.

Recent Insider Transactions

The supplied six-month insider summary reports 1,463,527 shares purchased across 12 transactions and 190,047 shares sold across four transactions, resulting in net purchases of 1,273,480 shares. Among the ten latest reported events, most were stock awards or grants; the two disclosed sales had reported values totaling $175,422 and do not by themselves establish management’s view of the company’s prospects.

Risks Investors Should Watch

• Cost pressure: Cost of revenue grew much faster than sales, and both the operating and adjusted EBITDA losses widened. Continued fuel-cost volatility or additional weather disruptions could delay margin improvement.
• Liquidity and refinancing execution: Current liabilities substantially exceeded current assets at quarter-end. The company remains dependent on operating improvements, financing availability and completion of expected loan funding.
• Share dilution: The weighted-average share count increased sharply year over year, while period-end shares outstanding rose approximately 63% in six months. This reduced the reported per-share loss without reducing the total net loss.
• Revenue-mix dependence: Overall growth relied on a 101% increase in private charter revenue to offset scheduled service weakness. Slower charter growth or continued route-rationalization pressure would affect consolidated revenue.
• Software commercialization: SurfOS secured its first enterprise contract, but the planned Q4 product launches and broader enterprise sales effort still require successful execution.

Conclusion

Surf Air Mobility’s Q2 revenue growth was driven by a rapidly expanding private charter business, while scheduled service contracted and cost pressures caused operating losses to widen. The next points to monitor are whether charter momentum continues, airline efficiencies translate into narrower losses, SurfOS contracts begin contributing meaningfully and the revised financing structure improves liquidity without further substantial dilution.