Summary of Sky Harbour (SKYH) Q2 2026 Earnings Call

1Key Financial Results and Metrics

Assets Under Construction: Increased to over $393 million, a $65 million rise year-to-date, marking the highest in the company's history.

Revenue Growth: Q2 revenues rose 50% year-over-year and 13% sequentially, driven by new campus openings and increased occupancy and rental rates.

Operating Expenses: Increased due to new campus openings, particularly from headcount and non-cash accruals related to new ground leases.

Cash Flow: Positive cash flow from operating activities reached approximately $0.5 million, marking the first positive cash flow in the company's history. Cash flow from operations for the obligated group was nearly $3 million, up from $2.2 million a year ago.

Adjusted EBITDA: Improved to approximately negative $0.9 million, with expectations for further improvement as new campuses stabilize.

2Strategic Updates and Business Highlights

Leasing Strategy: The company is focusing on pre-leasing new campuses, with a goal of achieving 50-66% occupancy before opening. The strategy has been successful in markets like Miami and San Jose.

Site Acquisition Focus: Continued emphasis on Tier 1 airports for new ground leases, with a strategy to maximize hangar space and align interests with airport authorities.

Development Progress: All development projects are on schedule and on budget, with a significant increase in construction capacity expected as multiple campuses are developed simultaneously.

New Initiatives: The launch of "Sky Key," a program providing network access to top residents, is anticipated to enhance customer experience and create additional revenue streams.

3Forward Guidance and Outlook

Revenue Guidance: The company reaffirms its expectation for an annualized revenue run rate between $42 million and $46 million by year-end, up from $39.4 million.

Adjusted EBITDA Guidance: Anticipates an annualized run rate of adjusted EBITDA between $4 million and $6 million by year-end, improving from a negative position in Q2.

Future Developments: The company plans to increase construction from over 600,000 square feet to over 1.2 million square feet by year-end, indicating robust growth.

4Bad News, Challenges, or Points of Concern

Leasing Challenges: Economic occupancy in Denver has been slower than expected, which is a disappointment for the company. The leasing strategy in this market has not met initial expectations.

Operating Expenses: Rising operating expenses due to new campus openings and non-cash accruals could impact profitability in the short term.

Market Risks: Potential macroeconomic headwinds, including construction inflation, could affect future cost management and profitability.

5Notable Q&A Insights

Pre-Leasing Strategy: The company confirmed that pre-leasing will be a standard practice for new constructions, with expectations of quicker lease-up times due to pent-up demand.

Ground Lease Focus: Emphasis on securing large square footage at Tier 1 airports rather than counting individual ground leases, with a long-term view on revenue and NOI.

Competitive Landscape: The competitive environment in Tier 1 markets is tightening, but the company remains aggressive in pursuing site acquisitions while maintaining patience in negotiations.

Investor Relations: The recent equity raise of $40 million was part of a strategic move to strengthen the company's financial position while awaiting potential future capital from public warrants. This summary encapsulates the key points from the earnings call, providing a balanced view of Sky Harbour's current financial standing, strategic direction, and challenges faced in the market.