LONDON — Air France-KLM reported on Thursday a record operating profit for 2025, sending its shares up 6.8 percent as its strategy of offering a premium customer experience bore fruit despite ongoing cost challenges.
European airlines have seen a rise in demand for premium services, despite a drop in the number of Europeans traveling to the United States last year. Air France-KLM said growth remained particularly strong on transatlantic routes, particularly for its premium cabins after the group invested heavily in faster Wi-Fi, upgraded airport lounges and a revamped first class.
"Our airlines carried over 100 million passengers (last year) and generated an operating result of more than 2 billion euros ($2.36 billion) — a first in our history," Chief Executive Ben Smith said in a statement.
That represents an increase of 400 million euros from 2024 and was comfortably above the 1.88 billion euros forecast by analysts for earnings before interest and taxes, in an LSEG poll.
The airline expects to increase its capacity by between 3 percent and 5 percent this year as new planes arrive. It also said it wants to widen its operating margin to over 8 percent by 2028. It reported a margin of 6.1 percent for 2025.
The better-than-expected results were in part driven by a drop in fuel prices as well as an increase in revenue. Costs continued to creep up with charges at Amsterdam's Schiphol airport squeezing per-passenger yields.
Air France-KLM shares are up almost 52 percent year-on-year as the group has managed to mitigate expensive labor challenges.
Still, analysts have flagged a potential slowdown in Americans traveling to Europe in the year to come as economic woes weigh on consumer spending and long-haul travel intentions.
