Revenue Recognition (Tables)

9 Months Ended

Sep. 30, 2018

The following are the significant categories comprising our reported operating revenues (in millions):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017		2018		2017
Passenger revenue:
Passenger travel	$	9,790	$	9,400	$	28,278	$	27,179
Loyalty revenue - travel ⁽¹⁾	771		696		2,436		2,268
Total passenger revenue	10,561		10,096		30,714		29,447
Cargo	260		223		748		633
Other:
Loyalty revenue - marketing services	613		527		1,765		1,574
Other revenue	125		119		376		357
Total other revenue	738		646		2,141		1,931
Total operating revenues	$	11,559	$	10,965	$	33,603	$	32,011


⁽¹⁾	Loyalty revenue included in passenger revenue is principally comprised of mileage credit redemptions for air travel awards from mileage credits earned through travel and mileage credits sold to co-branded card and other partners. See discussion of Loyalty Revenue below.

The following is our total passenger revenue by geographic region (in millions):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017		2018		2017
Domestic	$	7,424	$	7,162	$	22,071	$	21,522
Latin America	1,210		1,183		3,939		3,622
Atlantic	1,504		1,363		3,471		3,170
Pacific	423		388		1,233		1,133
Total passenger revenue	$	10,561	$	10,096	$	30,714	$	29,447

Schedule of Contract Liabilities



	September 30, 2018		December 31, 2017
	(In millions)
Loyalty program liability	$	8,559	$	8,822
Air traffic liability	5,040		4,042
Total	$	13,599	$	12,864

The balance of the loyalty program liability fluctuates based on seasonal patterns, which impact the volume of mileage credits issued through travel or sold to co-branded card and other partners (deferral of revenue) and mileage credits redeemed (recognition of revenue). Changes in loyalty program liability are as follows (in millions):



Balance at December 31, 2017	$	8,822
Deferral of revenue	2,302
Recognition of revenue ⁽¹⁾	(2,565		)
Balance at September 30, 2018 ⁽²⁾	$	8,559


⁽¹⁾	Principally relates to revenue recognized from the redemption of mileage credits for both air and non-air travel awards. Mileage credits are combined in one homogenous pool and are not separately identifiable. As such, the revenue is comprised of miles that were part of the loyalty program deferred revenue balance at the beginning of the period as well as miles that were issued during the period.

⁽²⁾

Mileage credits can be redeemed at any time and do not expire as long as that AAdvantage member has any type of qualifying activity at least every 18 months. As of September 30, 2018, our current loyalty program liability was $3.2 billion and represents our current estimate of revenue expected to be recognized in the next twelve months based on historical trends, with the balance reflected in long-term loyalty program liability expected to be recognized as revenue in periods thereafter.

American Airlines, Inc. [Member]

Entity Information [Line Items]

Disaggregation of Revenue

The following are the significant categories comprising American's reported operating revenues (in millions):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017		2018		2017
Passenger revenue:
Passenger travel	$	9,790	$	9,400	$	28,278	$	27,179
Loyalty revenue - travel ⁽¹⁾	771		696		2,436		2,268
Total passenger revenue	10,561		10,096		30,714		29,447
Cargo	260		223		748		633
Other:
Loyalty revenue - marketing services	613		527		1,765		1,574
Other revenue	122		116		367		349
Total other revenue	735		643		2,132		1,923
Total operating revenues	$	11,556	$	10,962	$	33,594	$	32,003


⁽¹⁾	Loyalty revenue included in passenger revenue is principally comprised of mileage credit redemptions for air travel awards from mileage credits earned through travel and mileage credits sold to co-branded card and other partners. See discussion of Loyalty Revenue below.

The following is American's total passenger revenue by geographic region (in millions):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2018		2017		2018		2017
Domestic	$	7,424	$	7,162	$	22,071	$	21,522
Latin America	1,210		1,183		3,939		3,622
Atlantic	1,504		1,363		3,471		3,170
Pacific	423		388		1,233		1,133
Total passenger revenue	$	10,561	$	10,096	$	30,714	$	29,447

Schedule of Contract Liabilities



	September 30, 2018		December 31, 2017
	(In millions)
Loyalty program liability	$	8,559	$	8,822
Air traffic liability	5,040		4,042
Total	$	13,599	$	12,864



Balance at December 31, 2017	$	8,822
Deferral of revenue	2,302
Recognition of revenue ⁽¹⁾	(2,565		)
Balance at September 30, 2018 ⁽²⁾	$	8,559


⁽¹⁾	Principally relates to revenue recognized from the redemption of mileage credits for both air and non-air travel awards. Mileage credits are combined in one homogenous pool and are not separately identifiable. As such, the revenue is comprised of miles that were part of the loyalty program deferred revenue balance at the beginning of the period as well as miles that were issued during the period.

⁽²⁾

Mileage credits can be redeemed at any time and do not expire as long as that AAdvantage member has any type of qualifying activity at least every 18 months. As of September 30, 2018, American's current loyalty program liability was $3.2 billion and represents American's current estimate of revenue expected to be recognized in the next twelve months based on historical trends, with the balance reflected in long-term loyalty program liability expected to be recognized as revenue in periods thereafter.