Franco-Dutch airline group Air France-KLM posted a second-quarter operating result of €736 million ($802 million), up €223 million ($243 million) from a year ago, with the operating margin expanding to 8.7%. The group said this was driven by strong revenue growth, improving yields, and growing demand for premium cabins.
Revenue rose 6.2% on the same period of last year to €8.44bn ($9.2bn), driven by strong performances across all business units, including passenger, cargo, and its low-cost arm, Transavia.
Group unit revenue per ASK rose 2.4% on the year prior at constant currency, supported by strong yield performance across the group's network.
Passenger yields remained resilient on the North Atlantic despite tariff volatility, and saw further improvement across Asia, the Middle East, and Latin America—driven in particular by continued strength in premium cabin demand, the airline group confirmed.
Adjusted EBITDA increased 13% to €9 million ($9.8 million), while recurring adjusted free cash flow for the first half of the year climbed to €723 million ($788 million), up nearly €589 million ($642 million) on the same period of 2024, on the back of strong working capital performance.
Net operating free cash flow stood at €1.285bn ($1.4bn). With net capital expenditure of €1.742bn ($1.9bn), net debt declined marginally to €7.135bn ($7.8bn), resulting in a leverage ratio of 1.5x – within management’s targeted 1.5x to 2.0x range. The group held €9.4bn ($10.3bn) of liquidity by end-June.
“Air France-KLM delivered a solid second quarter, with revenue growth and improved margins, reflecting the strength of our diversified network and the disciplined execution of our strategy,” said Benjamin Smith, the group’s CEO. “We are advancing premiumisation, pushing the boundaries of aspirational travel with enhanced products and services, while progressing on the renewal of our fleet with next-generation aircraft, in line with our sustainability efforts.”
Smith acknowledged that although the external operating environment remains complex, Air France-KLM is still resilient and well-positioned to achieve its targets.
The group welcomed 27.3 million passengers during the quarter, up 5.9% on the same period last year, with an average load factor of 87.8%.
In line with its fleet renewal strategy, Air France-KLM said it will continue to take delivery of new-generation aircraft such as A350s, 787-10s, A320neo family aircraft, A220s, and Embraer 195-E2s. At the end of June 2025, the group had 30% of its fleet composed of new-generation aircraft. The company aims to reach 80% by 2030.
Air France-KLM reaffirmed its 2025 guidance, maintaining an agile stance amid continued macroeconomic uncertainty. The group expects capacity, measured in ASKs, to grow by 4–5% on last year, while unit costs are projected to rise by a low single digit.
Net capital expenditures are forecast between €3.2 billion and €3.4 billion ($3.5–$3.7 billion), reflecting ongoing investment in fleet renewal and operations. The group also aims to keep its leverage ratio between 1.5x and 2.0x, consistent with its long-term financial targets.
During the quarter, Air France–KLM said it would take a majority stake in SAS, increasing its stake in the Scandinavian carrier to 60.5%, purchasing portions of the company held by majority shareholder Castlelake and Lind Invest.
The group currently holds a 19.9% stake in SAS and, since the summer of 2024, has initiated commercial cooperation through expanded codeshare and interline agreements - further reinforced by SAS's entry into the SkyTeam airline alliance.
The value of Air France-KLM’s investment in SAS will be determined at the closing of the transaction, based on the airline’s latest financial performance – including EBITDA and net debt. This transaction would be in line with the group’s medium-term financial outlook.