Surf Air Mobility(SRFM 8.09%) reported fiscal second quarter 2025 results on August 12, 2025 (period ended June 30, 2025), with revenue reaching $27.4 million, exceeding guidance, and adjusted EBITDA loss improving to $9.5 million. The quarter featured new commercial contracts, transformative software milestones with Palantir, and a substantial $44.7 million equity capital raise that deleveraged the balance sheet and positioned the company for strategic growth and operational profitability.
Surf Air Mobility revenue exceeds forecast on operational gains
Second quarter revenue (GAAP) of $27.4 million was up 17% quarter-over-quarter, with scheduled service revenue rising 20% and on-demand revenue rising 5% sequentially. The controllable completion factor in scheduled service, a key aviation reliability metric, climbed from 82% in the first quarter to 95% in the second quarter.
"Second quarter revenue of $27.4 million exceeded the company's guidance of $23.5 million to $26.5 million and rose 17% sequentially versus the first quarter, with scheduled service revenue rising 20% and on-demand revenue rising 5%. The increase in scheduled service revenue is directly correlated to improvement in our controllable completion factor from 82% in the first quarter to 95% in the second quarter."
Consistent improvement in core operational metrics directly enabled the company to surpass revenue guidance and accelerate its path to full-year airline operations profitability, defined as positive adjusted EBITDA (non-GAAP).
Surf Air Mobility partners with Palantir for exclusive software commercialization
The company closed a five-year software license agreement positioning Surf Air Mobility as Palantir’s exclusive configuration and sales partner for regional air operator segments, with sublicensing rights and collaborative development opportunities for industry-wide digital transformation. Six letters of intent have been secured for flagship SurfOS products ahead of commercial launch, with rollout planned for 2026, demonstrating market interest.
"The company will be Palantir's exclusive partner with respect to the configuration and sell of software to Part 135 operators and charter brokers. The company will have the ability to sublicense certain of its rights under the agreement to third-party clients. Lastly, the agreement contemplates the company and Palantir teaming to bid on software development projects for Part 135 operators and brokers, aircraft manufacturers and the FAA."
The company serves as Palantir’s exclusive configuration and sales partner for software to Part 135 operators and brokers in a market expected to reach $75 billion to $115 billion globally by 2035, unlocking both direct licensing and broader enterprise opportunities with government and OEM clients.
Capital infusion and note conversion delever balance sheet
Through multiple equity offerings and the conversion of $29.9 million of convertible notes into 5.9 million shares in July, the company reduced annual interest costs by at least $2.9 million while expanding its investor base. The most significant direct equity placement of $27 million closed in June 2025, with a total of $44.7 million raised.
"In July, $29.9 million of principal of a convertible note inclusive of then accrued interest was converted into 5.9 million shares of the company's common stock, significantly delevering our balance sheet. The company will benefit from annualized interest savings of a minimum of $2.9 million, assuming a floor interest rate of 9.75% per year."
This proactive deleveraging and liquidity enhancement reinforce operational agility and capacity for further strategic investment, reducing financial risk and supporting sustainable growth initiatives across technology and air service expansions.
Looking Ahead
Management guided for third quarter revenue to remain in the $27 million to $28.5 million range, with adjusted EBITDA loss between $8.5 million and $10 million. For fiscal 2025 (period ending December 31, 2025), revenue is expected to exceed $100 million. The company achieved profitability in its airline operations during the second quarter. Launch of the SurfOS commercial platform is planned to begin in the first half of 2026, and the electrification initiative targets late 2027 for market introduction.
