The acquisition of Sun Country closed on May 13, 2026, and the four-month-old combination is the single event that defines Allegiant right now, because it roughly doubles the fleet, adds a contracted cargo airline flying twenty-two freighters for Amazon, and shifts the equity from a pure single-fleet ultra-low-cost carrier into a diversified leisure operator with two operating certificates and a long-term contract revenue stream. In the second quarter ended June 30, 2026, consolidated revenue reached $943.5 million, up 36.9 percent year over year, but the quarter still produced a GAAP net loss of $4.9 million, or $0.21 a share, because $66.0 million of special charges tied to the acquisition and integration flowed through the income statement. The stock closed near $85.75 in mid-August, down from a 52-week high of $123.63, having fallen roughly thirty percent since the deal was announced, as the market has wrestled with how to value a bigger, more leveraged company that no longer resembles the small growth stock it once was.
The thesis for the equity rests on a specific mechanism. Allegiant Air alone produced a record $776.2 million of revenue in the quarter, up 16.1 percent on 6.8 percent less capacity, with the per-mile revenue metric called total revenue per available seat mile reaching a record 14.42 cents, up 24.6 percent, because the airline cut off-peak flying and focused its remaining seats on peak leisure demand. Sun Country contributed roughly seven weeks of results in which it booked $167.3 million of revenue, including $45.7 million of fixed-fee contract revenue and $27.6 million of cargo revenue from the Amazon arrangement. Management guides to at least $140 million of annual run-rate synergies within three years of close and a combined full-year 2026 adjusted earnings per share above $6.00, a number that implies the market is only beginning to price the combined earnings power, in our view.
The load-bearing risk is fuel, execution, and integration. Fuel cost per gallon jumped 45.4 percent year over year to $3.65 in the quarter due to the Iranian conflict that began in February, and the combined company now carries roughly $2.78 billion of debt and finance lease obligations, up sharply from the pre-merger balance sheet, against a guidance range for third-quarter adjusted earnings per share between negative one dollar and zero because the third quarter is the seasonally weakest stretch for the legacy Allegiant network. The falsifiable clock for the thesis is the fourth quarter print and the pace of the Mattress-style integration, since the single most important tests are whether the company can hold unit revenue growth near the 24.6 percent pace, whether the Amazon cargo contract runs reliably, and whether the promised $140 million of synergies materialize, all of which the Reader should be able to judge from the next two quarterly reports.