Company Reports

Air France-KLM’s second-quarter revenue rose 9.9% to EUR 9.3 billion. Adjusted operating profit fell by EUR 251 million to EUR 484 million as a EUR 804 million fuel headwind reduced the operating margin by 3.5 percentage points to 5.2%.

Air France-KLM is a European network carrier utilizing a hub-and-spoke model. Its two major hubs are Charles de Gaulle Airport in Paris and Schiphol Airport in Amsterdam.

Air France-KLM's first-quarter 2026 revenue rose 4.4% to EUR 7.48 billion, the operating result improved to a loss of EUR 27 million from a loss of EUR 328 million, and passenger unit revenue increased 3.4% at constant currency.

Air France-KLM is a European network carrier utilizing a hub-and-spoke model. Its two major hubs are Charles de Gaulle Airport in Paris and Schiphol Airport in Amsterdam.

Air France-KLM is a European network carrier utilizing a hub-and-spoke model. Its two major hubs are Charles de Gaulle Airport in Paris and Schiphol Airport in Amsterdam.

Air France-KLM reported 2025 revenue of EUR 33.0 billion, up 4.9%, with operating profit of EUR 2.0 billion and margin of 6.1%, up 1 percentage point. Passenger volumes rose 5%, while unit costs increased only around 1%, at the low end of guidance.

Air France-KLM posted mixed results. Revenue rose 3% to EUR 9.2 billion and operating income to EUR 1.2 billion, but net profit fell 6% to EUR 730 million as soft yields and weaker load factors hurt margins. Capacity grew 5.1% versus 4.5% traffic, with the load factor and unit revenue down 0.5%.

Air France-KLM will redeem its deeply subordinated perpetual bonds on Nov. 24, marking another step in balance-sheet repair.

Air France-KLM delivered a strong first quarter despite macro headwinds, aided by disciplined capacity deployment, successful premium cabin monetization, and easing fuel costs. Group revenue rose 7.7% year on year to EUR 6.9 billion, driven by 4% capacity growth and 3% improvement in unit revenue, supported by a favorable fuel environment and strong premium cabin performance. Despite the seasonally weak quarter and the absence of Easter, adjusted operating loss narrowed to EUR 328 million, an improvement of EUR 161 million year on year. Free cash flow was robust at EUR 800 million, reducing net debt to EUR 6.9 billion and leverage to 1.6 times EBITDA.

We raise our fair value estimate for no-moat Air France-KLM to EUR 10.40 from EUR 9, reflecting continued support for revenue per passenger kilometer from capacity constraints. Since the pandemic, European airlines have enjoyed record-high passenger yields and Air France-KLM is no exception. In 2024, the group reported RPK of EUR 9.59 cents, up from EUR 7.78 cents in 2019. Revenue per available seat kilometer also rose significantly, from EUR 9.30 cents in 2019 to EUR 11.12 cents in 2024. This was driven by strong travel demand exceeding available capacity, enabling airlines to pass on higher costs to customers.

Air France-KLM is a European network carrier utilizing a hub-and-spoke model. Its two major hubs are Charles de Gaulle Airport in Paris and Schiphol Airport in Amsterdam.

Revenue grew 4.8% for the full year, driven by a 3.6% capacity increase and 0.6% unit revenue growth. Fourth-quarter unit revenue rose 4.4%, up from 1.4% in the previous quarter.

No moat Air France-KLM reported a stable operating result of EUR 1.2 billion, compared with last year after adjusting for a one-time EUR 160 million impact from reduced Olympic traffic. Group revenue rose by 4%, aligned with capacity growth, and unit revenue rose 1.4%, excluding Olympic effects, reflecting a resilient pricing environment. However, significant cost pressures, especially within KLM, negatively affected the operating margin, resulting in a 2.4% year-over-year EBIT margin decline, adjusted for the Olympics.

We are initiating coverage of Air France-KLM with a no-moat rating and a fair value estimate of EUR 9 on the back of continued strong travel demand, gradual capacity recovery, and operational efficiency, resulting in improved profitability and cash flow generation.

Air France-KLM is a European network carrier utilizing a hub-and-spoke model. Its two major hubs are Charles de Gaulle Airport in Paris and Schiphol Airport in Amsterdam.

We are dropping coverage of Air France-KLM. We provide broad coverage of more than 1,500 companies globally and periodically adjust our coverage according to investor interest and staffing.

Air France-KLM reported a very good set of results, generating EUR 386 million EBIT in the second quarter, which is a EUR 1.1 billion improvement on the prior-year comparable period and approaching precoronavirus levels. This strong performance was driven by a return to profitability for the network airlines as traffic continues to recover and the group starts reaping the benefits of cost-saving measures. We maintain our EUR 3.70 fair value estimate with shares in deep discount territory, but we still have a Morningstar Uncertainty Rating of Very High as there is still a lot of work to be done to restore the balance sheet and repay government-aided loans.

We reduce Air France-KLM’s fair value estimate to EUR 3.70, from EUR 5.20, as we incorporate the EUR 2.26 billion rights issue into our model. The reduction in our fair value is entirely attributable to the deeply discounted subscription price of EUR 1.17 per share, which compares with our previous forecast of a rights issue done at EUR 2.50. We also change our uncertainty rating to very high from extreme. We believe there is still lots of work to be done in terms of restoring the balance sheet, but at least some level of certainty is achieved with the announcement. Shares appear attractive, but we caution about the wide range of outcomes as a result of group indebtedness and the uncertainty around the recovery in air traffic demand. We prefer the low-cost carriers Ryanair, Wizz Air, and EasyJet, which are all trading at attractive discounts with relatively lower risk.

Air France-KLM is a European network carrier with major hubs at Charles de Gaulle Airport in Paris and Schiphol Airport in Amsterdam. The coronavirus dealt a heavy blow to the global airline industry, including Air France-KLM, whose balance sheet has been devastated. To shore up liquidity the group has received EUR 10.4 billion in state backed bailouts. The EUR 4 billion restructuring of the French state backed loans in April 2021 was not enough to plug the hole in the group’s balance sheet and comes with heavy restrictions, such as excluding the group from engaging in acquisitions. The group announced an additional EUR 2.56 billion rights issue in May 2022, while additional capital restructuring is required to fully restore the group's balance sheet. The high levels of indebtedness, low visibility, and high probability of further equity value destruction is reflected in our very high uncertainty rating.

Air France-KLM announced a EUR 2.26 billion rights issue as part of its effort to recapitalize the EUR 4 billion hole in its balance sheet and repay state aid. The second rights issue since the start of the pandemic will be heavily dilutive for nonparticipating shareholders at a price of EUR 1.17 per share and three shares for every existing share held, translating into a 75% dilution. Our existing forecast and fair value estimate made provision for a EUR 3 billion rights issue at EUR 2.50. We expect to lower our EUR 5.20 fair value estimate as a result of the deep discount. We have had the group on an extreme uncertainty rating for some time owing to its weak balance sheet. We will revisit our rating once it its clear that the group is adequately recapitalized.