Air France-KLM reported lower than expected revenue growth in the third quarter, impacted by strikes and increases in both air ticket taxes and airport fees.
The European airline group saw revenues increase 2.6 per cent year on year to €9.2 billion, driven by “strong” premium demand and lower fuel costs.
The company posted an operating result of €1.2 billion, which marked an improvement of €23 million compared to the same period last year. Comparatively, profits in the previous quarter increased by €223 million year on year.
A recent increase in France’s solidarity tax on air tickets, coupled with ATC strikes in early July “significantly” impacted revenues at Air France during the quarter. The French flag carrier reported an operating result of €799 million, up €67 compared to the same period in 2024, which followed a 2.6 per cent increase in revenues to €5.69 billion.
Meanwhile, a 41 per cent hike in airport fees at Amsterdam Schiphol in April, together with labour disputes in September, weighted on KLM’s operating result. The Dutch carrier reported a 14 per cent year-on-year decline in Q3 profits to €341 million, despite a “modest” 1.2 per cent increase in revenue to €3.59 billion.
During an earnings call on Thursday (6 November), Air France-KLM chief financial officer Steven Zaat also pointed to changes to US visa and immigration rules, which have “started to hurt” the group’s long-haul economy segment.
Group revenue per available seat kilometre (ASK) in the third quarter was down 2.4 per cent year on year, while capacity (measured in available seat kilometres) increased 3.4 per cent and load factor fell 0.5 percentage points to 88.8 per cent.
Air France-KLM Group CEO Benjamin Smith, in a statement, said: “During the third quarter, Air France–KLM once again demonstrated its resilience in a challenging environment… Premium cabins performed exceptionally well across both Air France and KLM, further reinforcing our confidence in our premiumisation strategy.”
Throughout the third quarter, Air France-KLM took delivery of 14 new-generation aircraft and in July became the first airline group to adopt the EU’s Flight Emissions Label.
Air France on Thursday also announced plans to launch services between Paris and Las Vegas next summer.
The group also reconfirmed its full-year 2025 outlook, with an expected 4-5 per cent increase in capacity compared to 2024.