Blade Air Mobility Q2 2025 Earnings Report

Blade Air Mobility EPS Results

• Actual EPS: -$0.05
• Consensus EPS: -$0.04
• Beat/Miss: Missed by -$0.01
• One Year Ago EPS: N/A

Blade Air Mobility Revenue Results

• Actual Revenue: $70.80 million
• Expected Revenue: $64.09 million
• Beat/Miss: Beat by +$6.72 million
• YoY Revenue Growth: N/A

Blade Air Mobility Announcement Details

• Quarter: Q2 2025
• Date: 8/5/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, August 5, 2025
• Conference Call Time: 8:00AM ET

Blade Air Mobility (NASDAQ:BLDE) provides air transportation alternatives to the congested ground routes in the United States. It provides its services through charter and by-the-seat flights using helicopters, jets, turboprops, and amphibious seaplanes. The company was founded in 2014 and is headquartered in New York, New York.

Blade Air Mobility Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Blade agreed to sell its passenger business to Joby Aviation for up to $125 million, a transformation aimed at creating long-term value by separating lower-margin rotorcraft operations from higher-growth segments.
• Positive Sentiment: The medical division will become standalone Strata Critical Medical, a pure-play contractual medical business with 60 % of group revenue in 2024 and 85 % of segment adjusted EBITDA, positioned for organic and acquisitive growth.
• Positive Sentiment: In Q2 2025, medical revenues rose 17.6 % year-over-year to $45.1 million with segment adjusted EBITDA margin of 13.4 %, and management expects margins to improve to ~15 % in H2 2025.
• Negative Sentiment: Elevated scheduled maintenance downtime on the owned fleet in Q2, due to additional G inspections and engine overhauls, led to a 100 bp year-over-year decline in medical segment adjusted EBITDA margin.
• Positive Sentiment: Blade ended Q2 2025 debt-free with $113.4 million in cash, reaffirmed 2025 guidance of $245–265 million in revenue with double-digit adjusted EBITDA excluding the divestiture impact.

Presentation

[Operator]

Good morning, ladies and gentlemen, and welcome to the Blade Air Mobility Fiscal Second Quarter twenty twenty five Earnings Release Conference Call. At this time, all participants are in a listen only mode. Later, we'll conduct a question and answer session and instructions will follow at that time. As a reminder, this call is being recorded. I would now like to turn the conference call over to Matt Schneider, Vice President of Investor Relations and Strategic Finance. Matt, you may now begin.

[Mathew Schneider, Vice President of Investor Relations and Strategic Finance at Blade Air Mobility]

Thank you for standing by, and welcome to the Blade Air Mobility conference call and webcast for the quarter ended 06/30/2025. We appreciate everyone joining us today. Before we get started, I would like to remind you of the company's forward looking statement and Safe Harbor language. Statements made in this conference call that are not historical facts, including statements about future time periods, may be deemed to constitute forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements are subject to risks and uncertainties, and actual future results may differ materially from those expressed or implied by the forward looking statements.

[Mathew Schneider, Vice President of Investor Relations and Strategic Finance at Blade Air Mobility]

We refer you to our SEC filings, including our annual report on Form 10 ks filed with the SEC for a more detailed discussion of the risk factors that could cause these differences. Any forward looking statements provided during this conference call are made only as of the date of this call. As stated in our SEC filings, Blade disclaims any intent or obligation to update or revise these forward looking statements, except as required by law. During today's call, we will also discuss certain non GAAP financial measures, which we believe may be useful in evaluating our financial performance. A reconciliation of the most directly historical comparable consolidated GAAP financial measures to those historical non GAAP financial measures is provided in our earnings press release and investor presentation.

[Mathew Schneider, Vice President of Investor Relations and Strategic Finance at Blade Air Mobility]

Our press release, investor presentation, and our Form 10 Q and 10 ks filings are available on the Investor Relations section of our website at ir.blade.com. These non GAAP measures should not be considered in isolation or a substitute for financial results prepared in accordance with GAAP. Hosting today's call are Rob Wiesenthal, Founder and Chief Executive Officer of Blade and Will Hayburn, Chief Financial Officer and Melissa Tomkiel, President. I'll now turn the call over to Rob.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

Thank you, Matt, and good morning, everyone. Yesterday, we announced the sale of the Blade passenger business to Joby Aviation for up to $125,000,000 This transaction is transformational for both the Blade passenger business and Blade medical division, which will remain a standalone publicly traded company and be renamed Strata Critical Medical. It will be a pure play contractual medical business operating in rapidly growing markets uniquely situated to enjoy organic growth as well as an aggressive acquisition strategy. We strongly believe that this is the best path forward to create long term value for all stakeholders, including employees, customers, partners, and shareholders. Blade's medical business has grown from 12% of revenue in 2020 to approximately 60% of revenue in 2024, while accounting for approximately 85% of our segment's adjusted EBITDA.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

Fundamentally, the passenger and medical businesses have different growth, investment and investor profiles. The strength and awareness of Blade as a consumer brand simply overshadowed the high growth, highly profitable nature of our medical business. And this transaction will unlock the full potential of each business over the coming years. The Blade passenger sale includes all our passenger operations in The US, Europe, including lounges, terminals, as well as the Blade brands. Blade's mission since inception has been to accelerate the transition from traditional rotorcraft to electric aircraft.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

There is no stronger company than Joby Aviation to help make this mission a reality for the benefit of all stakeholders. Our medical division has long been our fastest growing and most profitable business line with no direct reimbursement risk, limited economic sensitivity, and an attractive multi year growth profile, we believe a standalone Blade Medical will have appeal with a broader set of investors versus the historical combined company structure. I am confident that the pure play nature of Strata combined with the cash war chest that should more than double in size will enable our stock to enjoy a valuation that represents the strength we have today, coupled with the numerous opportunities we have ahead. We have a clear value creation strategy for Shredder over the coming years, driven by strong underlying organic growth and a highly focused and disciplined capital allocation strategy, supported by approximately $200,000,000 of cash on the balance sheet pro form a for the upfront portion of the Blade Passenger sale, in addition to up to $35,000,000 to be received within twelve to eighteen months based on certain employee retention and financial metrics. Trinity Medical Solutions, the company's operating business in the medical segment and one of the largest air transporters of human organs for transplant in The United States, will remain Stratus' wholly owned subsidiary.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

I will join Jovi Aviation as CEO of Blade Air Mobility when the transaction closes and as the largest individual shareholder of our parent company, I will also serve as Chairman of Strata at closing. Melissa Tom Kiel and Will Hayburn have overseen our medical division for many years and will serve as co CEOs of Strata while retaining their general counsel and CFO roles respectively, providing a seamless transition for our customers, suppliers and employees. We are very lucky to have them as our co CEOs. Importantly, the financial impact of the divestiture is expected to be adjusted EBITDA and free cash flow neutral on a go forward annualized basis, supported by approximately $7,000,000 in estimated corporate cost efficiencies. I'm also confident that even more economic streamlining opportunities lay ahead.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

Will and Melissa will talk more about Strata's value creation strategy in a few moments. Lastly, we're announcing this transformation from a position of strength that is reflected in our strong Q2 twenty twenty five financial results as medical revenue accelerated its growth to 18% in Q2 twenty twenty five versus the prior year period. With that, I'll turn the call over to Will.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

Thank you, Rob. I'm excited for the opportunity to lead Strata alongside Melissa Topgiel and this exciting next phase of growth for the company.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

We are laser focused on executing a multiyear value creation strategy built on first continued share gains and product line extensions and the rapidly growing non correlated markets we serve. And second, a disciplined capital allocation strategy supported by approximately $200,000,000 of cash on the balance sheet pro form a for the upfront proceeds from the blade passenger sale. The company may also receive up to an additional 35,000,000 to be received within twelve to eighteen months from closing based on certain employee retention and financial metrics. In our core organ transplant market, we expect strong organic growth over the coming years, driven by increasing transplant volumes supported by technology adoption and regulatory change, continued new customer acquisition and growth in ancillary businesses, including ground and organ placement. As we've talked about before, we see several additional growth opportunities, both within our core organ transplant market and in adjacent markets.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

There is also considerable opportunity to deploy capital towards strategic acquisitions that strengthen our core business growth potential and earnings power. We're looking forward to providing more detail around our graph value creation strategy and our actionable M and A pipeline at an Investor Day this fall. Before I walk through the financial results, I'll turn it over to Melissa for a few remarks.

[Melissa Tomkiel, President & General Counsel at Blade Air Mobility]

Thanks, Will. I'm thrilled to help guide Strata as we enter this new phase of growth. Our end to end time critical air logistics platform is second to none and is trusted by more organ transplant hospitals than any other provider. We will remain relentless in supporting our customers, all of whom are engaged in life saving work every day. Our 100% contracted customer retention rate over the last twelve months is a testament to this unwavering commitment to health care providers we serve.

[Melissa Tomkiel, President & General Counsel at Blade Air Mobility]

We're also setting ourselves up for future success as technology continues to revolutionize the art of the possible in organ transplantation. As part of this transaction, Strata is entering into a long term partnership with Jovi through which we will gain access to Jovi eVTOL aircraft for medical use anywhere they have operations. We expect that the quiet capabilities of Jovi's aircraft coupled with its potential to operate at lower costs than traditional helicopters and other shorter range aircraft will provide value to Strata customers and a competitive advantage for the company. In the meantime, we will provide the industry leading service we are known for using conventional aircraft, managing costs down and improving call out times for the hospitals we serve by moving aircraft closer to their facility. We'll also continue to broaden our support for all the incredible new organ preservation technologies that are available and becoming available soon.

[Melissa Tomkiel, President & General Counsel at Blade Air Mobility]

Our partnership with Organox is a great example. The length we will go to, to ensure we can always say yes to our customers' requests to accommodate new technology. We're excited about the multiple avenues for organic growth in the medical business, including broadening our service offering within our core organ transplant market. We launched POTS, our organ placement service in late twenty twenty three, and we introduced a hand carry logistics service offering targeted at kidneys, a segment of the market that we have limited participation in historically. And this business has grown significantly year to date.

[Melissa Tomkiel, President & General Counsel at Blade Air Mobility]

I look forward to meeting with many of you over the coming weeks and months to discuss our plans for value creation and the unique opportunities ahead. With that, I'll turn it over to Will to discuss the financial results.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

Thanks, Melissa. I'll now walk through the financial highlights from the quarter, starting with medical medical revenues rose 17.6% year over year to a record setting 45,100,000.0 Q2 twenty twenty five. After a slow start to the year, we saw a strong rebound in the second quarter, driven primarily by new transplant center customers, along with strengthened demand from third party service providers. Round and tops, our organ placement service, also contributed to revenue growth ahead of the average for the rest of the business this year. Medical segment adjusted EBITDA margin rose to 13.4% in Q2 twenty twenty five versus 11.4% in Q1 twenty twenty five, but declined 100 basis points compared to 14.4% in Q2 twenty twenty four.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

This was expected as maintenance downtime and costs remain elevated in the second quarter, driven by the timing of scheduled maintenance events on our own fleet. To provide context, on average, our fleet of 10 aircraft can have approximately three major inspections, which are called G inspections, and two engine overhauls per year. In 2025, we have four G inspections and five engine overhauls scheduled with these maintenance events weighted towards the first half of the year. Given that our own fleet provides the best unit economics on both the P and L and cash basis, elevated maintenance downtime has two negative impacts on our financial results. First, though we continue to perform all trips for our customers as contracted, we must substitute higher cost aircraft from our asset light network.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

Second, lower hours on our own fleet results in fixed cost under absorption and a higher fully loaded average cost per flight hour. It's important to recognize that scheduled maintenance downtime will vary from year to year with elevated maintenance downtime in some years and below normal downtime in other years, resulting in the opposite effect, higher fleet uptime and improved fixed cost absorption. We continue to expect an improvement in fleet uptime and medical segment adjusted EBITDA margins in the second half of the year, and we'll provide more details on the outlook shortly. Turning to our passenger business. Excluding Canada, which we exited in August 2024, short distance revenue decreased 5.5% year over year, driven primarily by lower revenue in The US short distance segment, partially offset by strength in Europe.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

US short distance revenue was impacted by the New York tourist helicopter incident in April 2025, along with inclement weather in June, which was an outlier versus previous June's, both of which we view as transitory. Encouraging, we've seen meaningful improvement in US short business performance in July relative to Q2 twenty twenty five. Following the restructuring of our European operations last fall, we've seen two consecutive quarters of strong revenue growth. We attribute the improving fundamentals in Europe to the realignment of interest with our local partners, along with important operational and commercial changes that have reinvigorated growth and improved the customer experience. In Jet and Other, revenue decreased 2% year over year, driven by a modest reduction in flight volume and revenue per flight compared with the year ago period.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

Despite lower revenue, we continue to see a significant improvement in passenger segment profitability in Q2 'twenty five, driven by improving flight margins and lower segment adjusted SG and A. Passenger segment flight margin rose five eighty basis points year over year to 30.5% in Q2 twenty twenty five, driven by margin expansion in short distance, including the restructuring in Europe and our exit from Canada, along with margin improvement in jet and other. Passenger segment adjusted SG and A fell 17% year over year, driven by lower marketing spend in The US, the restructuring in Europe, and the discontinuation of Canada. Passenger segment adjusted EBITDA tripled year over year from $800,000 to 2,400,000.0 Moving to adjusted unallocated corporate expense and software development. We continue to focus on cost efficiencies across the business and during the quarter expenses declined 2.1% year over year.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

Turning to cash flow. Given our strong sequential revenue growth in Q2 twenty twenty five of 30% versus Q1 twenty twenty five, we saw a proportionate increase in working capital during the period. The difference between our Q2 twenty twenty five adjusted EBITDA of $3,200,000 and cash from operations of negative $3,100,000 in the quarter was primarily driven by a $7,000,000 increase in working capital, partially offset by an increase in deferred revenue. It's important to notice that our collections remain healthy with day sales outstanding down to thirty two days in Q2 twenty twenty five compared with thirty four days in the year ago period. Capital expenditures inclusive of capitalized software development costs were 2,700,000.0 in the quarter, driven primarily by capitalized aircraft maintenance of approximately 1,800,000.0 at capitalized software development of 400,000.0.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

Our owned aircraft fleet is unchanged at 10 aircraft, and we remain focused on optimizing the financial and operational performance of the fleet. Given the significant strategic and financial benefits of our owned aircraft, it's possible that we'll add a low single digit number of aircraft to the fleet over the next year or two, but we are not currently in the process of buying any new aircraft. We ended the quarter with no debt and $113,400,000 of cash and short term investments. Moving on to the outlook, we expect the sale of our passenger business to be neutral to adjusted EBITDA and free cash flow on a go forward basis. We expect the loss of passenger segment adjusted EBITDA to be offset by a reduction in unallocated costs associated with passenger business.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

The seasonality of the passenger business, where Q3 is typically the strongest quarter of the year, followed by a seasonally weak Q4, could create a modest timing impact in 2025, depending on the exact timing of the transaction close. We will update our revenue and adjusted EBITDA guidance for 2025 after the close of the transaction. For our Medical segment specifically, revenue growth accelerated in Q2 twenty twenty five, driven by new customer additions, and we've seen this strength continue into July. We expect mid teens revenue growth in the second half of the year. As discussed previously, Medical segment adjusted EBITDA margins were impacted by elevated scheduled maintenance downtime and costs in the 2025.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

We continue to expect improved owned fleet uptime and medical segment adjusted EBITDA margins in the second half of the year with margins of approximately 15%. Given uncertainty on the exact closing time for the passenger divestiture, we are reaffirming our 2025 guidance on a full company basis, excluding the impact of the divestiture. We expect revenue between $245,000,000 and $265,000,000 with double digit adjusted EBITDA. We will provide guidance for the standalone medical business following the close of the transaction. With that, we'll turn it back over to the operator for Q and A.

[Operator]

Yes, thank you. At this time, we'll conduct a question and answer session. To ask a question, you'll need to press 11 on your telephone and wait for your name to be announced. Your first question comes from the line of Laura Lee of Deutsche Bank. Your line is now open.

[Laura Li, Equity Research Associate at Deutsche Bank]

Hey, thank you for taking my question. So my first question is about with that up to $125,000,000 in proceeds from Jovi. What are your current priorities for capital allocation to help your, like, either organic or inorganic growth? And also, like, how confident are we to meet that required milestones or metrics for the 35,000,000 or not?

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

Hi, it's Rob Wiesenthal. How are you? I think that in terms of deployment of capital, we see a lot of opportunities in terms of M and A, Opportunities that I believe are actionable and can really sustain the kind of growth that we hope for kind of going forward. On the organic side, you're well aware of what we're doing with tops. We're well aware of reaching with other types of verticals such as critical cargo.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

And this is the kind of capital base that I think we really need to get the company to where it needs to be in terms of really scaling in an exponential way, which is a real opportunity because there aren't a lot of companies out there that I think can be as nimble as us with the kind of balance sheet that we have to in a very forward way, in quick way to try to get the kind of M and A deals under our belt that we see out there. I'm happy about that. In terms of the metrics for some of the holdbacks when I evaluate and the board evaluated the transaction obviously you know we felt those were achievable when we view this as a transaction that is a $125,000,000 transaction. There is some there is potential risk out there obviously but if we didn't think we could do it we wouldn't have agreed with.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

And Laura, just some detail on that.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

About half of the $35,000,000 holdback is related to retention, mostly related to Rob specifically. And then the other half is related to financial performance that is really pegged around just continuing the status quo performance we've had. So we do believe that these are achievable. Obviously, nothing's without risk.

[Laura Li, Equity Research Associate at Deutsche Bank]

Okay. Okay. Gotcha. Okay. Just another follow-up on that.

[Laura Li, Equity Research Associate at Deutsche Bank]

Do you see any operational impacts around the divestiture to the, like, medical segments, like, in terms of infrastructure, lesser relationship, or do you like operating team, etcetera?

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

No, we think we're set up for success as a standalone company. And on the vertical takeoff and landing side, we're entering into a long term agreement with Joby both to continue providing access to helicopters in the markets where we're using today. But also on a much more exciting note, providing access to the Joby aircraft for medical use in any markets that they roll So we think that's actually going to be a huge value add for our customers given the expected quiet operation of these aircraft, expected lower costs, and also could provide us with a competitive advantage. So we're really excited about the long term partnership.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

These were always two distinct businesses and in fact you know if you take a look at what we're saying about EBITDA remaining consistent here. I think there's a lot of opportunity to kind of streamline the operation. Obviously the operators are based in Arizona and we're happy about that and I think in terms of the kind of business overhead that we need to run the business, I think that we really have the opportunity to be extremely lean and efficient. So we feel pretty good about that And definitely, I see upside.

[Laura Li, Equity Research Associate at Deutsche Bank]

Okay. Gotcha. Yeah. Appreciate it.

[Operator]

Thank you. Your next question comes from the line of Bill Peterson with JPMorgan. Your line is now open.

[Bill Peterson, Equity Research at JP Morgan]

Hey, good morning, everyone. Thanks for the information thus far and congrats on the transaction. I have a few questions. I guess, first starting off, I guess, if we think about the passenger business sale, why now versus when maybe at a later point it could have been more profitable? I understand, obviously, you wanted to bolster the medical, but how long were discussions ongoing to sell this piece of the business?

[Bill Peterson, Equity Research at JP Morgan]

Guess, were there any concerns on your prior announced sort of EV toll partnerships, maybe that they'd be too late or like just any sort of additional context on sale, please?

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

Sure. Think that why now? I think that frankly when I take a look at the stock and listen to investors, it was clear that they were discounting the value of passenger business. We were not getting value for it at the same time. We were unable to invest the kind of capital that I think it needs to grow without hampering the overall earnings of the company.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

And it just was too confusing a story on the investor side and I think the opportunity to really be a pure play medical kind of M and A machine here and to roll up what I view as a pretty fragmented business with high growth and high margin prospects was the right move to create shareholder value. And then with respect to live Jovi, I think early on I think we identified them as the company that we felt had the best path to certification the capital to execute in the right technology and that would be first to market. I'm unequivocal about that. Know, we up to this point, we were agnostic. We've watched all of all the other companies out there in terms of what they've been able to get to and what milestones they've hit.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

And I do believe they have a you know, to your question, I do think they have much more of a head start with respect to getting to the point of flying. We'll be flying in Dubai next year and hopefully in The US thereafter. Does that answer your question, Bill? Do you have any follow ups?

[Bill Peterson, Equity Research at JP Morgan]

That is that part of the question. I want to pivot to the medical business a bit. And I realize you're planning an Investor Day where we'll get a lot more information. But I want to try to get a sense as you look at it today on how you think the growth outlook would look, let's say, first from an inorganic point of view and then inorganic. I guess, how should we think about revenue growth, CAGR, steady state margins?

[Bill Peterson, Equity Research at JP Morgan]

Just trying to get a sense of your latest snapshot view there.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

Yeah, Bill Will here. Still incredibly enthusiastic about the growth prospects in this industry, broadly and for us specifically. Seeing organic growth in the long term. We're seeing that digital level that's supported by all the new technology that we've been talking about on our prior calls. We're seeing more and more providers of organ preservation technology come into the fold, starting to look into a lot of the hospitals that use that kind of phenolic.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

We're also seeing some new therapies as we talked about like NRP, normal thermic regional perfusion. It's giving more access to those donation after circulatory death donors, which previously had been a pretty extensive and somewhat risky in terms of actually being able to successfully complete the transplant prospects for folks to go after those kind of organs. And all of those things we believe are still in the early innings of playing out and in the early innings of becoming more broadly available at an affordable cost for hospitals. So we expect to continue to see that strong growth in the number of people that are getting successful transplants in America. And then when we think about the specific opportunity for us, this quarter is a great testament to our ability to provide a better value proposition than the competition and win new customers and continue to gain share in this very fragmented market.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

So I think still lots of opportunity there. And the last piece of it is just our ability to provide other services to those same customers. We'll provide other services like what we're already doing to folks outside of the direct transplant community that we're serving today. We talked about in the scripts how we've seen faster growth in our TOPS program and our ground program than we are in the overall business on average. So you're going to continue to see those things help us accelerate our growth.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

And then all of those things come together to help us get to our long term high teens adjusted EBITDA margin target, which we still think is readily achievable. And now that we've built the business with more operating leverage from the owned aircraft, the more we fly, the less it's going to cost for us. So long term thesis very much intact and couldn't be more excited about our opportunities ahead.

[Bill Peterson, Equity Research at JP Morgan]

If I can just finish up on a near term and housekeeping question. I guess just on the medical business, how should we think about any seasonality in the business? I mean, in the third quarter, just trying to get a sense that there is seasonality as you see it today. How is the business trending quarter to date? And then on the housekeeping side, can you speak to any tax implications of the transaction?

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

Sure, Bill. On the seasonality, look, wouldn't call it a seasonal business. You do occasionally see a little bit of a slowdown in the summer months driven just by kind of staffing of folks being on vacation. We've not seen that quarter to date. We had a great July, continued to see similar trends that we saw in Q2.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

But we have seen in years past a moderate slowdown in kind of the late summer. But have not seen that show up in our numbers yet. On the tax side, we have enough NOLs to offset the capital gain associated with the passenger divestiture. Assuming we receive that full $125,000,000 of proceeds, we use about a third of the NOLs that we have. That would be just under $50,000,000 remaining.

[William Heyburn, CFO & Head of Corporate Development at Blade Air Mobility]

We can't offset 100% with NOLs, as you know, under the rules. But we would expect the cash tax impact to be a couple million dollars, something immaterial. So we think we're in a great shape on that front.

[Bill Peterson, Equity Research at JP Morgan]

Okay, thanks for that detail. I'll pass it on. But again, congratulations on the transaction and best wishes going forward to the full team.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

Thank you, Bill.

[Operator]

Thank you. The next question comes from the line of Bill Khalif with Lake Street Capital Markets. Your line is now open.

[Ben Klieve, Senior Equity Research Analyst at Lake Street Capital Markets]

All right. Thanks for taking my questions. And yeah, echo the sentiments. Congratulations on the successful divestiture here. First question is around kind of the process with the divestiture.

[Ben Klieve, Senior Equity Research Analyst at Lake Street Capital Markets]

I'm curious, Rob, you kind of noted how specifically advantaged you believe Jovia is in this world. And I'm wondering the extent to which the process was kind of a sweeping one where you considered all possible strategics and financial buyers, or if you really had kind of a laser focused view that Joby would be best able be a successful partner in this divestiture?

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

Yeah, I think thanks for your question. I think since we started this company, the name of the company was never Blade Helicopters, always Blade Permanent Remobility. So we knew we had to make this transition at some point. We were a bit agnostic. We met and worked with pretty much every single OEM out there, both from you know the major companies out there like you know Boeing and others as well as the VTOL manufacturers.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

And so I would say it was definitely a sweeping process that I was personally involved in And it's gone and went from everywhere from OEMs to luxury good companies to private equity, name it. And it was clear that the right move for us was doing something with Joey because truly believe that their time to market capital and technology is going to get them and especially with this transaction to market much sooner than others. As important for the medical side, I wanted to make sure that we had a partner where there were there was an actionable strategy in terms of EV talk. I really think it can change the financial architecture of how we fly surgeons in organs in kind of short to mid term short to mid range flights. It really was a two part decision.

[Ben Klieve, Senior Equity Research Analyst at Lake Street Capital Markets]

Got it. Got it. That's helpful and good to hear. The second question, I'll get back in queue, is around the $7,000,000 of corporate efficiency that you've noted are going to be going away. Can you kind of characterize what these expenses were?

[Ben Klieve, Senior Equity Research Analyst at Lake Street Capital Markets]

Is this personnel that's going to be going to Joby? Is this internal development cost that you're just backing away from? Just any context there would be great.

[Mathew Schneider, Vice President of Investor Relations and Strategic Finance at Blade Air Mobility]

Hey, Ben, this is Matt. So these are just costs that are really associated with the passenger segment that were in unallocated expenses. So everything from staff costs to IT costs, a portion of lease costs. So several different categories of costs that are closely related to the operation of the passenger business.

[Ben Klieve, Senior Equity Research Analyst at Lake Street Capital Markets]

Okay, good. I appreciate that. Thanks, Matt. Thanks, Rob. And congratulations again to all. I'll get back in queue.

[Robert Wiesenthal, CEO & Director at Blade Air Mobility]

Thanks, Ben.

[Operator]

Thank you. This concludes the question and answer session. Thank you for your participation on today's conference. This does conclude the program, and you may now disconnect.

Participants

Executives

• Mathew Schneider, Vice President of Investor Relations and Strategic Finance
• Robert Wiesenthal, CEO & Director
• William Heyburn, CFO & Head of Corporate Development
• Melissa Tomkiel, President & General Counsel

Analysts

• Laura Li, Equity Research Associate at Deutsche Bank
• Bill Peterson, Equity Research at JP Morgan
• Ben Klieve, Senior Equity Research Analyst at Lake Street Capital Markets