Sky Harbour Group Corporation (NYSE: SKYH) reported substantial operational progress and financial growth in the third quarter of 2025, marking a critical transition from development phase to revenue-generating operations across its expanding aviation infrastructure network. The company's strategic expansion across key aviation markets positions it as a growing force in the specialized aviation real estate sector.
The company now conducts resident flight operations at nine campuses, including fully operational sites at Sugar Land (SGR), Nashville (BNA), Miami Opa-Locka (OPF), San Jose (SJC), Camarillo (CMA), Phoenix Deer Valley (DVT), Dallas Addison (ADS), Seattle Boeing Field (BFI), and Denver Centennial (APA). This operational footprint represents a significant milestone in the company's strategy to dominate the aviation infrastructure market at Tier 1 airport locations. Additional development projects at Bradley (BDL), Dulles (IAD), Orlando Executive (ORL), Salt Lake City (SLC), Portland-Hillsboro (HIO), and Long Beach (LGB) continue to advance through development and pre-leasing phases, indicating sustained growth momentum.
Financial performance showed robust improvement, with consolidated revenue reaching approximately $7.3 million in the third quarter, representing a 78% year-over-year increase and 11% sequential growth. This revenue acceleration reflects the successful ramp-up of additional campuses coming online. Rental revenue increased to roughly $5.7 million while fuel revenue reached about $1.6 million, driven by higher utilization rates at both stabilized and recently opened facilities. The company's stabilized campuses generally maintained at or near full occupancy, while newer locations like ADS and DVT surpassed the 50% leased threshold, demonstrating strong market demand.
Construction and development activity remains intensive, with constructed assets and construction-in-progress rising to more than $308 million at quarter-end. The ongoing investment spans multiple high-value locations including Phoenix Deer Valley, Dallas Addison, Denver Centennial, and Miami Opa-Locka Phase 2. The ADS campus received final certificates of occupancy and became fully operational, while APA commenced resident flight operations as it neared completion. These milestones represent the company's successful transition from construction to income generation at multiple campuses.
Development pipeline progress includes OPF Phase 2 remaining on schedule for completion in the second quarter of 2026, Bradley breaking ground with targeted delivery in the fourth quarter of 2026, and site work advancing at Salt Lake City and other Tier 1 locations including Orlando Executive, Portland-Hillsboro, and Long Beach. The company continues to leverage its vertically integrated platform, including Ascend Aviation Services and Stratus Building Systems, to enhance quality control, manage per-square-foot costs, and improve delivery timelines across the network.
Financial metrics showed improvement in gross margin, which reached 13.5% in the third quarter compared to 10.2% in the same period last year and negative 2.0% in the previous quarter. However, operating loss widened to $7.7 million from $4.8 million in the prior-year quarter, reflecting the costs associated with rapid expansion. Net income attributable to common shareholders was negative $1.9 million, or $0.06 per diluted share, while adjusted EBITDA remained negative but showed improvement on a run-rate basis.
The company strengthened its capital position with approximately $48.0 million in consolidated cash, restricted cash, and U.S. Treasuries at quarter-end. A new $200 million tax-exempt warehouse facility, expandable to $300 million, provides draw-as-needed flexibility at an attractive fixed rate with no prepayment penalty. This facility remained undrawn at quarter-end, preserving substantial capacity to fund five to six upcoming developments across Tier 1 airports. Management also strengthened the capital stack by signing a joint venture letter of intent on an SH34 hangar at OPF Phase 2, providing flexible, lower-cost funding to support the next wave of growth.
Stonegate Capital Partners maintains coverage on Sky Harbour Group and provides detailed analysis through their research platform at https://www.stonegateinc.com. The firm's discounted cash flow analysis produces a valuation range of $12.81 to $19.93 with a midpoint of $15.74, reflecting confidence in the company's growth trajectory and strategic positioning within the aviation infrastructure market.
