Airlines expect higher profitability in 2025 even as supply chain issues persist
The International Air Transport Association (IATA) on Tuesday announced its financial outlook for the global airline industry in 2025, which shows a slight strengthening of profitability amid ongoing cost and supply chain challenges.
Net profits are expected to be $36.6 billion in 2025 for a 3.6% net profit margin. That is a slight improvement from the expected $31.5 billion net profit in 2024 (3.3% net profit margin). Average net profit per passenger is expected to be $7.0 (below the $7.9 high in 2023 but an improvement from $6.4 in 2024).
Operating profit in 2025 is expected to be $67.5 billion for a net operating margin of 6.7% (improved from 6.4% expected in 2024).
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The return on invested capital (ROIC) for the global industry is expected to be 6.8% in 2025. While this is an improvement from the 2024 ROIC of 6.6%, the returns for the industry at the global level remain below the weighted average cost of capital. ROIC is the strongest for airlines in Europe, the Middle East, and Latin America, where it did exceed the cost of capital.
Total industry revenues are expected to be $1.007 trillion. That is an increase of 4.4% from 2024 and will be the first time that industry revenues top the $1 trillion mark. Expenses are expected to grow by 4.0% to $940 billion.
Passenger numbers are expected to reach 5.2 billion in 2025, a 6.7% rise compared to 2024 and the first time that the number of passengers has exceeded the five billion mark.
Cargo volumes are expected to reach 72.5 million tonnes, a 5.8% increase from 2024.
“We’re expecting airlines to deliver a global profit of $36.6 billion in 2025. This will be hard-earned as airlines take advantage of lower oil prices while keeping load factors above 83%, tightly controlling costs, investing in decarbonization, and managing the return to more normal growth levels following the extraordinary pandemic recovery”, said Willie Walsh, IATA’s Director General.
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Plataforma Informativa de Aviación Comercial líder en América Latina.