Press release - Air France-KLM Q2 2025 results

Core Insights - Air France-KLM reported a solid second quarter in 2025, achieving revenue growth of 6.2% year-on-year to €8.4 billion and an operating result of €736 million, reflecting strong margin expansion to 8.7% [2][6][9] - The company continues to focus on premiumization and fleet renewal, with a significant investment in next-generation aircraft as part of its sustainability efforts [3][21] - Air France-KLM is taking steps to strengthen its position in Northern Europe by initiating proceedings to acquire a majority stake in SAS [3][30] Financial Performance - The operating result improved by €223 million year-on-year, with a margin increase of 2.3 percentage points [6][9] - Group passenger numbers rose by 5.9% to 27.3 million, with capacity and traffic both increasing by 4.2% [4][7] - The net income for the quarter reached €649 million, a significant increase of €484 million compared to the previous year [6][58] Revenue and Cost Analysis - Unit revenue per available seat kilometer (ASK) increased by 2.4% at constant currency, driven by strong performance in Network and Transavia [8][9] - Operating costs rose by 2.7% year-on-year, influenced by increased air traffic control and airport charges, particularly a 41% increase in Schiphol tariffs [6][18] - The company reported a recurring adjusted operating free cash flow of €723 million, up nearly €589 million year-on-year [10][11] Strategic Developments - Air France-KLM is advancing its sustainability initiatives, with 30% of its fleet now composed of next-generation aircraft, aiming for 80% by 2030 [21][22] - The company is actively working on increasing the demand and usage of sustainable aviation fuel (SAF) [23][24] - A significant focus is placed on enhancing global connectivity through strategic partnerships and joint ventures [3][29] Business Segment Performance - The passenger network segment reported a strong performance with a 5.0% increase in passenger traffic revenue [31] - Cargo revenues increased by 3.6% in the second quarter, supported by a 2.5% rise in traffic cargo revenues [42] - Transavia experienced a 12.9% increase in passenger numbers, although faced cost pressures leading to a slight decline in operating margin [44][45] Future Outlook - The company maintains an agile approach for the remainder of 2025, with expectations for continued revenue growth and margin improvement despite external uncertainties [3][20] - Net capital expenditures are projected to be between €3.2 billion and €3.4 billion, with a leverage ratio targeted between 1.5x and 2.0x [6][20]