Company Reports

As Hong Kong’s flagship carrier, Cathay Pacific operates an extensive global network, leveraging its dominant position at a leading international aviation hub. With no domestic market, it is fully reliant on international traffic. In 2025, the South Asia, Middle East, and Africa market contributed 42% of Cathay’s passenger capacity, followed by North America with 36% and Europe with 27%.

Cathay Pacific's first-half 2026 revenue jumped 25% to HKD 68.1 billion, while net profit increased 71% to HKD 6.2 billion. Excluding the HKD 1.4 billion noncash gain from the dilution of its Air China stake to 12.85%, net profit grew 32% to HKD 4.8 billion. Shares rose 2% post-results.

As Hong Kong’s flagship carrier, Cathay Pacific operates an extensive global network, leveraging its dominant position at a leading international aviation hub. With no domestic market, it is fully reliant on international traffic. In 2025, the South Asia, Middle East, and Africa market contributed 42% of Cathay’s passenger capacity, followed by North America with 36% and Europe with 27%.

Brent crude has remained above USD 100 per barrel as the Iran war drags on with no clear resolution in sight. With only 30% of fuel exposure hedged, the lack of visibility poses a significant headwind for Cathay. Despite implementing a fuel surcharge, passenger capacity was reduced in May and June.

As Hong Kong’s flagship carrier, Cathay Pacific operates an extensive global network, leveraging its dominant position at a leading international aviation hub. With no domestic market, it is fully reliant on international traffic. In 2025, the South Asia, Middle East, and Africa market contributed 42% of Cathay’s passenger capacity, followed by North America with 36% and Europe with 27%.

Cathay Pacific's 2025 revenue increased 12.0% year on year to HKD 117 billion, and operating margin narrowed 50 basis points to 12.1%. The company expects to receive more than 100 new aircraft over the next few years. Shares gained 4% following the earnings release.

As the flagship airline in Hong Kong, Cathay Pacific operates an extensive global route network leveraging its dominance in the international aviation hub. The absence of a domestic market means Cathay must rely entirely on international markets. Before the pandemic, the North American market accounted for about 26% of Cathay's passenger capacity, followed by Europe and North Asia (including China), each representing about 20% of capacity.

Share prices of ANA, Cathay Pacific, and Singapore Airlines are falling 5%-7% in reaction to the rise in oil prices due to the outbreak of the war in Iran. The Brent crude futures price has gained 31% year to date to over $79 per barrel on the risk of disruption to Iranian oil output.

Over the weekend, Airbus ordered immediate software rollbacks and repairs to 6,000 A320 family jets following an incident involving a sharp loss of altitude. Asian airlines in our coverage, ANA Holdings, Cathay Pacific, and Singapore Airlines, are among carriers with A320s in service.

Cathay Pacific plans to buy back 643 million shares currently owned by Qatar Airways. The block, which represents 9.57% of Cathay's current share base, will cost Cathay approximately HKD 6.9 billion. Cathay's shares jumped 5% on this news.

As the flagship airline in Hong Kong, Cathay Pacific operates an extensive global route network leveraging its dominance in the international aviation hub. The absence of a domestic market means Cathay must rely entirely on international markets. Before the pandemic, the North American market accounted for about 26% of Cathay's passenger capacity, followed by Europe and North Asia (including China), each representing about 20% of capacity.

We raise our in-house oil price assumptions, which guide the fuel price forecasts for Asian airlines in our coverage, specifically ANA Holdings, Cathay Pacific, and Singapore Airlines.

Cathay Pacific reported first-half 2025 revenue of HKD 54.3 billion, a 9.5% year-on-year increase. Operating profit came in at HKD 5.9 billion, broadly unchanged from a year ago, as incremental costs associated with higher volumes offset the benefits of top‑line expansion.

As the flagship airline in Hong Kong, Cathay Pacific operates an extensive global route network leveraging its dominance in the international aviation hub. The absence of a domestic market means Cathay must rely entirely on international markets. Before the pandemic, the North American market accounted for about 26% of Cathay's passenger capacity, followed by Europe and North Asia (including China), each representing about 20% of capacity.

Escalating tensions between Israel and Iran triggered airspace closures across the Middle East on June 23, forcing airlines to cancel, divert, or reroute flight paths. As of 25 June, midday, all countries except Iran have reopened their airspaces.

Share prices of ANA, Cathay Pacific and Singapore Airlines are down 5%, 16% and 7% respectively, hovering around recent lows as worries grow over potentially lower air travel demand. We revise our Morningstar Uncertainty Ratings ahead of third-quarter results and April operating statistics releases.

We transfer coverage to a new analyst. Cathay Pacific’s 2024 earnings of HKD 9.9 billion was largely flat year on year. The company announced a full-year dividend of HKD 0.69 per share, its highest since 2010, approaching its target payout of approximately 50% of profits.

As the flagship airline in Hong Kong, Cathay Pacific operates an extensive global route network leveraging its dominance in the international aviation hub. The absence of a domestic market means Cathay must rely entirely on international markets. Before the pandemic, the North American market accounted for about 26% of Cathay's passenger capacity, followed by Europe and North Asia (including China), each representing about 20% of capacity.

After incorporating Cathay Pacific's convertible bond redemption and its operating data up to October, we made minimal changes to our forecasts and maintained our fair value estimate at CNY 9.30. Cathay's share price has risen 20% since it proposed to redeem its convertible bond in mid-November, and currently trades at a 4% premium to our fair value estimate. For investors interested in airlines, we are more in favor of ANA Holdings, currently trading at a 9% discount to our fair value estimate.

As the flagship airline in Hong Kong, Cathay Pacific operates an extensive global route network leveraging its dominance in the international aviation hub. The absence of a domestic market means Cathay must rely entirely on international markets. Before the pandemic, the North American market accounted for about 26% of Cathay's passenger capacity, followed by Europe and North Asia (including China), each representing about 20% of capacity.