Revenue Recognition (Tables)

6 Months Ended

Jun. 30, 2021

Entity Information [Line Items]

Disaggregation of Revenue

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

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Passenger revenue:
Passenger travel	$	5,995	$	1,006	$	8,888	$	8,085
Loyalty revenue - travel (1)	550		102		836		703
Total passenger revenue	6,545		1,108		9,724		8,788
Cargo	326		130		641		277
Other:
Loyalty revenue - marketing services (2)	529		356		986		927
Other revenue	78		28		135		145
Total other revenue	607		384		1,121		1,072
Total operating revenues	$	7,478	$	1,622	$	11,486	$	10,137

(1)Loyalty revenue included in passenger revenue is principally comprised of mileage credit redemptions, which were earned from travel or co-branded credit card and other partners.

(2)During the three months ended June 30, 2021 and 2020, cash payments from co-branded credit card and other partners was $684 million and $573 million, respectively. During the six months ended June 30, 2021 and 2020, cash payments from co-branded credit card and other partners was $1.7 billion and $1.8 billion, respectively.

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

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Domestic	$	5,444	$	1,026	$	8,099	$	6,806
Latin America	936		34		1,417		1,214
Atlantic	125		42		147		565
Pacific	40		6		61		203
Total passenger revenue	$	6,545	$	1,108	$	9,724	$	8,788

Schedule of Contract Liabilities

	June 30, 2021		December 31, 2020
	(In millions)
Loyalty program liability	$	9,306	$	9,195
Air traffic liability	7,095		4,757
Total	$	16,401	$	13,952

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 credit 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, 2020	$	9,195
Deferral of revenue	983
Recognition of revenue (1)	(872)
Balance at June 30, 2021 (2)	$	9,306

(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 generally do not expire as long as that AAdvantage member has any type of qualifying activity at least every 18 months. In response to the COVID-19 pandemic, we suspended the expiration of mileage credits through December 31, 2021 and eliminated mileage reinstatement fees for canceled award tickets. As of June 30, 2021, our current loyalty program liability was $2.6 billion and represents our current estimate of revenue expected to be recognized in the next 12 months based on historical as well as projected trends, with the balance reflected in long-term loyalty program liability expected to be recognized as revenue in periods thereafter. Given the inherent uncertainty of the current operating environment due to the COVID-19 pandemic, we will continue to monitor redemption patterns and may adjust our estimates in the future.

American Airlines, Inc.

Entity Information [Line Items]

Disaggregation of Revenue

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

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Passenger revenue:
Passenger travel	$	5,995	$	1,006	$	8,888	$	8,085
Loyalty revenue - travel (1)	550		102		836		703
Total passenger revenue	6,545		1,108		9,724		8,788
Cargo	326		130		641		277
Other:
Loyalty revenue - marketing services (2)	529		356		986		927
Other revenue	78		28		134		144
Total other revenue	607		384		1,120		1,071
Total operating revenues	$	7,478	$	1,622	$	11,485	$	10,136

(1)Loyalty revenue included in passenger revenue is principally comprised of mileage credit redemptions, which were earned from travel or co-branded credit card and other partners.

(2)During the three months ended June 30, 2021 and 2020, cash payments from co-branded credit card and other partners was $684 million and $573 million, respectively. During the six months ended June 30, 2021 and 2020, cash payments from co-branded credit card and other partners was $1.7 billion and $1.8 billion, respectively.

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

	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020
Domestic	$	5,444	$	1,026	$	8,099	$	6,806
Latin America	936		34		1,417		1,214
Atlantic	125		42		147		565
Pacific	40		6		61		203
Total passenger revenue	$	6,545	$	1,108	$	9,724	$	8,788

Schedule of Contract Liabilities

	June 30, 2021		December 31, 2020
	(In millions)
Loyalty program liability	$	9,306	$	9,195
Air traffic liability	7,095		4,757
Total	$	16,401	$	13,952

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 credit 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, 2020	$	9,195
Deferral of revenue	983
Recognition of revenue (1)	(872)
Balance at June 30, 2021 (2)	$	9,306

(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 generally do not expire as long as that AAdvantage member has any type of qualifying activity at least every 18 months. In response to the COVID-19 pandemic, American suspended the expiration of mileage credits through December 31, 2021 and eliminated mileage reinstatement fees for canceled award tickets. As of June 30, 2021, American's current loyalty program liability was $2.6 billion and represents American's current estimate of revenue expected to be recognized in the next 12 months based on historical as well as projected trends, with the balance reflected in long-term loyalty program liability expected to be recognized as revenue in periods thereafter. Given the inherent uncertainty of the current operating environment due to the COVID-19 pandemic, American will continue to monitor redemption patterns and may adjust its estimates in the future.