REVENUE FROM CONTRACTS WITH CUSTOMERS

9 Months Ended

Sep. 30, 2019

Ticket revenue is recorded as Passenger revenue, and represents the primary source of the Company's revenue. Also included in Passenger revenue are passenger ancillary revenues, such as bag fees, on-board food and beverage, ticket change fees, and certain revenue from the frequent flyer program. Mileage Plan other revenue includes brand and marketing revenue from the Company's co-branded credit card and other partners and certain interline frequent flyer revenue, net of commissions. Cargo and other revenue includes freight and mail revenue, and to a lesser extent, other ancillary revenue products such as lounge membership and certain commissions.

The Company disaggregates revenue by segment in Note 9. The details within the Company’s statements of operations, segment disclosures, and in this footnote depict the nature, amount, timing and uncertainty of revenue and how cash flows are affected by economic and other factors.

Passenger Ticket and Ancillary Services Revenue

Passenger revenue recognized in the condensed consolidated statements of operations (in millions):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Passenger ticket revenue, including ticket breakage and net of taxes and fees	$	1,868	$	1,744	$	5,099	$	4,864
Passenger ancillary revenue	157		146		428		401
Mileage Plan passenger revenue	186		153		511		459
Total Passenger revenue	$	2,211	$	2,043	$	6,038	$	5,724

Mileage Plan™ Loyalty Program

Mileage Plan™ revenue included in the condensed consolidated statements of operations (in millions):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Passenger revenue	$	186	$	153	$	511	$	459
Mileage Plan other revenue	118		114		346		329
Total Mileage Plan revenue	$	304	$	267	$	857	$	788

Cargo and Other

Cargo and other revenue included in the condensed consolidated statements of operations (in millions):



	Three Months Ended September 30,				Nine Months Ended September 30,
	2019		2018		2019		2018
Cargo revenue	$	36	$	36	$	104	$	96
Other revenue	24		19		65		51
Total Cargo and other revenue	$	60	$	55	$	169	$	147

Air Traffic Liability and Deferred Revenue

Passenger ticket and ancillary services liabilities

The Company recognized Passenger revenue of $19 million and $27 million from the prior year-end air traffic liability balance for the three months ended September 30, 2019 and 2018, and $582 million and $540 million for the nine months ended September 30, 2019 and 2018.

Mileage Plan^TM assets and liabilities

The Company records a receivable for amounts due from the bank partner and from other partners as mileage credits are sold until the payments are collected. The Company had $103 million of such receivables as of September 30, 2019 and $119 million as of December 31, 2018.

The table below presents a roll forward of the total frequent flyer liability (in millions):



	Nine Months Ended September 30,
	2019			2018
Total Deferred Revenue balance at January 1	$	1,874		$	1,725
Travel miles and companion certificate redemption - Passenger revenue	(511		)	(459		)
Miles redeemed on partner airlines - Other revenue	(84		)	(66		)
Increase in liability for mileage credits issued	692			631
Total Deferred Revenue balance at September 30	$	1,971		$	1,831