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SEGMENTS | 12 Months Ended
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Dec. 31, 2022
Segment Reporting [Abstract] |
SEGMENTS | SEGMENTS Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker and is used in resource allocation and performance assessments. Our chief operating decision maker is considered to be our executive leadership team. Our executive leadership team regularly reviews discrete information for our two operating segments, which are determined by the products and services provided: our airline segment and our refinery segment. Airline Segment Our airline segment is managed as a single business unit that provides scheduled air transportation for passengers and cargo throughout the U.S. and around the world and includes our loyalty program, as well as other ancillary airline services. This allows us to benefit from an integrated revenue pricing and route network. Our flight equipment forms one fleet, which is deployed through a single route scheduling system. When making resource allocation decisions, our chief operating decision maker evaluates flight profitability data, which considers fleet type and route economics, but gives no weight to the financial impact of the resource allocation decision on a geographic region or mainline/regional carrier basis. Our objective in making resource allocation decisions is to optimize our consolidated financial results. Refinery Segment Our Monroe subsidiary operates the Trainer oil refinery and related assets located near Philadelphia, Pennsylvania, as part of our strategy to mitigate the cost of the refining margin reflected in the price of jet fuel. Monroe's operations include pipelines and terminal assets that allow the refinery to supply jet fuel to our airline operations throughout the Northeastern U.S., including our New York hubs at LaGuardia and JFK. Our refinery segment operates for the benefit of the airline segment by providing jet fuel to the airline segment from its own production and through jet fuel obtained through agreements with third parties. The refinery's production consists of jet fuel, as well as non-jet fuel products. We use several counterparties to exchange the non-jet fuel products produced by the refinery for jet fuel consumed in our airline operations. The gross fair value of the products exchanged under these agreements during the years ended December 31, 2022, 2021 and 2020 was $3.5 billion, $2.3 billion and $1.5 billion, respectively. Segment Reporting Segment results are prepared based on our internal accounting methods described below, with reconciliations to consolidated amounts in accordance with GAAP. Our segments are not designed to measure operating income or loss directly related to the products and services included in each segment on a stand-alone basis.
Financial information by segment |  |  |  |  |  |
(in millions) | Airline | Refinery |  | Intersegment Sales/Other |  | Consolidated
Year Ended December 31, 2022 |  |  |  |  |  |
Operating revenue: | $ | 45,605 |  | $ | 10,706 |  |  |  |  | $ | 50,582 |
Sales to airline segment |  |  |  | $ | (1,976) |  | (1) |
Exchanged products |  |  |  | (3,475) |  | (2) |
Sales of refined products |  |  |  | (278) |  |  |
Operating income(3) | 2,884 |  | 777 |  |  |  |  | 3,661 |
Interest expense, net | 1,029 |  | 12 |  |  | (12) |  |  | 1,029 |
Depreciation and amortization | 2,107 |  | 93 |  |  | (93) |  | (3) | 2,107 |
Restructuring charges | (124) |  | — |  |  |  |  | (124) |
Total assets, end of period | 69,355 |  | 3,039 |  |  | (106) |  |  | 72,288 |
Net fair value obligations, end of period | — |  | (226) |  |  |  |  | (226) |
Capital expenditures | 6,217 |  | 149 |  |  |  |  | 6,366 |
Year Ended December 31, 2021 |  |  |  |  |  |
Operating revenue: | $ | 26,670 |  | $ | 6,054 |  |  |  |  | $ | 29,899 |
Sales to airline segment |  |  |  | $ | (492) |  | (1) |
Exchanged products |  |  |  | (2,293) |  | (2) |
Sales of refined products |  |  |  | (40) |  |  |
Operating income (loss)(3) | 1,888 |  | (2) |  |  |  |  | 1,886 |
Interest expense, net | 1,279 |  | 7 |  |  | (7) |  |  | 1,279 |
Depreciation and amortization | 1,998 |  | 95 |  |  | (95) |  | (3) | 1,998 |
Restructuring charges | (19) |  | — |  |  |  |  | (19) |
Total assets, end of period | 70,417 |  | 2,099 |  |  | (57) |  |  | 72,459 |
Net fair value obligations, end of period | — |  | (497) |  |  |  |  | (497) |
Capital expenditures | 3,188 |  | 59 |  |  |  |  | 3,247 |
Year Ended December 31, 2020 |  |  |  |  |  |
Operating revenue: | $ | 15,945 |  | $ | 3,143 |  |  |  |  | $ | 17,095 |
Sales to airline segment |  |  |  | $ | (214) |  | (1) |
Exchanged products |  |  |  | (1,472) |  | (2) |
Sales of refined products |  |  |  | (307) |  |  |
Operating loss(3) | (12,253) |  | (216) |  |  |  |  | (12,469) |
Interest expense, net | 929 |  | 1 |  |  | (1) |  |  | 929 |
Depreciation and amortization | 2,312 |  | 99 |  |  | (99) |  | (3) | 2,312 |
Restructuring charges | 8,219 |  | — |  |  |  |  | 8,219 |
Total assets, end of period | 70,548 |  | 1,448 |  |  | — |  |  | 71,996 |
Net fair value obligations, end of period | — |  | (156) |  |  |  |  | (156) |
Capital expenditures | 1,879 |  | 20 |  |  |  |  | 1,899 |
(1)Represents transfers, valued on a market price basis, from the refinery to the airline segment for use in airline operations. We determine market price by reference to the market index for the primary delivery location, which is New York Harbor, for jet fuel from the refinery. (2)Represents value of products delivered under our exchange agreements, as discussed above, determined on a market price basis. (3)Refinery segment operating results, including depreciation and amortization, are included within aircraft fuel and related taxes in our income statement. Renewable Fuel Compliance Costs A refinery is subject to annual Environmental Protection Agency ("EPA") requirements to blend renewable fuels into the gasoline and on-road diesel fuel it produces. Alternatively, a refinery may purchase Renewable Identification Numbers ("RINs") from third parties in the secondary market. The Monroe refinery purchases the majority of its RINs in the secondary market. Renewable fuel compliance costs are accrued each period as the RINs obligation is generated. Purchased RINs are carried at the lower of cost and net realizable value and are recorded in prepaid expenses and other. The RINs obligation is recorded in accounts payable at cost for those purchased or under fixed price purchase agreements, with any remaining net obligation recorded at fair value. The RINs asset and obligation are retired when used to satisfy EPA requirements. The net fair value obligations presented in the financial information by segment table above are based on quoted market prices and other observable information and are therefore classified as Level 2 in the fair value hierarchy. Our obligation as of December 31, 2022 was calculated using the U.S. EPA Renewable Fuel Standard ("RFS") volume requirements, which were finalized in the June 2022 quarter. During the December 2022 quarter, we retired our 2020 RINs assets to settle our 2020 obligations prior to the compliance deadline. We expect to settle our 2021 and 2022 obligations in the first half of 2023.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI https://asc.fasb.org/topic&trid=2134510 + Details
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