Company: UP
Filing Date: 2025-03-11
Form Type: 10-K
Source: 0001819516-25-000012
Chunk: 112

Company: Wheels Up Experience Inc.
Filing Date: 2025-03-11
Form: 10-K
Item: Item 7
Chunk 112
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 period of continued transition, we may experience volatility and adverse or unintended impacts on our business, prospects, results of operations and financial condition that may not be reflective of future results or trends.

Costs and Expense Management

Our operating results are impacted by our ability to manage costs and expenses, as well as realize cost savings from improving our operations, leverage our scale and optimize previously acquired assets and businesses. Our success depends, in part, on achieving a balance between revenue growth initiatives and investments, and maintaining cost discipline through our cost reduction measures in order to decrease losses and drive eventual profitability. As described above, during 2024 we made improvements to our cost structure by implementing discrete cost reduction initiatives, changes to our workforce and other operational efficiency measures. We are working to find additional opportunities to enhance margins and operate more efficiently, while elevating the member experience and delivering operational excellence. In addition, we are investing significant time and resources into advancing our sophisticated pricing and scheduling algorithms and data optimization engines to help optimize the utility and efficiency of our operations. 

Economic Conditions & Inflation

The private aviation industry is volatile and affected by economic cycles and trends. On-demand flying is typically discretionary for members and customers, and may be affected by negative trends in the economy. Consumer confidence, changes in fuel prices, inflation, interest rates, geopolitical instability, governmental regulations or actions, taxes, tariffs and trade policies, safety concerns and other factors all could negatively impact our business, prospects, results of operations and financial condition. In addition, our members and customers may resort to other options for travel more or less frequently depending on the economic cycle. While we believe our current member programs and charter offerings, as well as our aircraft fleet, are well positioned to best serve our total addressable market, the foregoing factors, many of which are outside of our control, may adversely impact our ability to retain members and customers, grow or sustain previous levels of flight activity, efficiently utilize our 

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assets, manage our costs and expenses, or provide service offerings on terms attractive to our members and customers.

In addition, we are directly and indirectly impacted by inflation. Since 2020, the U.S. has experienced inflation rates that are higher than historical average. Although inflation rates continued to normalize to historical trends throughout 2024, we have experienced price relocation for certain products and services we used in our operations, as well as wages for qualified personnel, that may be prolonged or permanent. It is also difficult to predict future levels of inflation or the impacts of taxes, tariffs and trade policies in