v3.24.0.1
Revenue Recognition
12 Months Ended
Dec. 31, 2023
Revenue from Contract with Customer [Abstract]  
Revenue Recognition Revenue Recognition
The Company categorizes revenue recognized from contracts with its customers by revenue source as we believe it best depicts the nature, amount, timing, and uncertainty of our revenue and cash flow. The following table provides revenue recognized by revenue source for the years ended December 31, 2023, 2022, and 2021 (in millions):
Twelve Months Ended December 31,
202320222021
Passenger revenue
Passenger travel$8,403 $8,078 $5,304 
Loyalty revenue - air transportation605 508 305 
Other revenue
Loyalty revenue422 391 306 
Other revenue185 181 122 
Total operating revenue$9,615 $9,158 $6,037 
TrueBlue® is our customer loyalty program designed to reward and recognize our customers. TrueBlue® points earned from ticket purchases are recorded as a reduction to Passenger travel within passenger revenue. Amounts presented in Loyalty revenue - air transportation represent the revenue recognized when TrueBlue® points have been redeemed and travel has occurred. Loyalty revenue within other revenue is primarily comprised of the non-air transportation elements of the sales of our TrueBlue® points.
Contract Liabilities
Our contract liabilities primarily consist of ticket sales for which transportation has not yet been provided, unused credits available to customers, and outstanding loyalty points available for redemption (in millions):
December 31, 2023December 31, 2022
Air traffic liability - passenger travel$1,099 $1,291 
Air traffic liability - loyalty program (air transportation)1,072 1,000 
Deferred revenue (1)
487 530 
Total $2,658 $2,821 
(1) Deferred revenue is included within other accrued liabilities and other liabilities on our consolidated balance sheets.
During the years ended December 31, 2023 and 2022, we recognized passenger revenue of $1.2 billion that was included in passenger travel liability at the beginning of the respective periods.
The Company elected the practical expedient that allows entities to not disclose the amount of the remaining transaction price and its expected timing of recognition for passenger tickets if the contract has an original expected duration of one year or less or if certain other conditions are met. We elected to apply this practical expedient to our contract liabilities relating to passenger travel and ancillary services as our tickets or any related passenger credits expire generally one year from the date of issuance.
TrueBlue® points are combined into one homogeneous pool and are not separately identifiable. As such, the revenue is comprised of the points that were part of the air traffic liability balance at the beginning of the period as well as points that were issued during the period.
The table below presents the activity of the current and non-current air traffic liability for our loyalty program, and includes points earned and sold to participating companies for the years ended December 31, 2023 and 2022 (in millions):
Balance at December 31, 2021$891 
TrueBlue® points redeemed passenger
(508)
TrueBlue® points earned and sold
617 
Balance at December 31, 20221,000 
TrueBlue® points redeemed passenger
(605)
TrueBlue® points redeemed other
(24)
TrueBlue® points earned and sold
701 
Balance at December 31, 2023$1,072 
The timing of our TrueBlue® point redemptions can vary; however, the majority of our points are redeemed within approximately three years of the date of issuance.