#Canada #Montreal #financial results #Air Canada #Q2 2025

Air Canada Announces Strong Q2 2025 Financial Results

Air Canada has demonstrated remarkable resilience by reporting its second-quarter financial results for 2025. The airline has seen operating revenues reach an impressive $5.632 billion, marking a 2% increase from the same period last year. Furthermore, the operating income rose to $418 million with an operating margin of 7.4%. Notably, the adjusted EBITDA stood at $909 million, symbolizing an adjusted EBITDA margin of 16.1%.

CEO Michael Rousseau expressed pride in the results, particularly given the competitive and ever-changing airline industry landscape. The airline managed to lead all major North American carriers in terms of on-time performance for May and June, contributing to elevated customer service ratings. This reflects an overall strategic focus on streamlining operations while capitalizing on high-demand markets and premium service offerings.

The thriving performance of Air Canada Cargo, Air Canada Vacations, and the Aeroplan loyalty program were significant contributors to this positive financial outcome. In addition to strong operating figures, the airline reported cash flows from operating activities reaching $895 million, and a notable free cash flow of $183 million.

Equity and Shareholder Value

Rousseau highlighted the airline's commitment to shareholder value. During the quarter, Air Canada completed a $500 million substantial issuer bid, effectively buying back approximately 26.6 million shares for cancellation. The airline has shown continuous discipline in its capital allocation strategy, which has enabled it to maintain a leverage ratio of 1.4 as of June 30, 2025.

Moreover, the airline's strong customer feedback and recognition in industry awards, including being named the Best Airline in North America at the Skytrax World Airline Awards, serve to reinforce its brand credibility. Rousseau extended his congratulations to Air Canada's dedicated employees for their pivotal role in ensuring high service standards and operational excellence.

Outlook for 2025

Looking forward, Air Canada aims to increase its ASM capacity by 3.25% to 3.75% compared to the third quarter of 2024. The airline has reaffirmed its full-year financial guidance, expecting adjusted EBITDA between $3.2 billion and $3.6 billion. Key assumptions are based on moderate Canadian GDP growth and jet fuel prices averaging C$0.92 per liter.

As Air Canada continues to navigate through macroeconomic challenges, the airline remains hopeful about its growth strategy, fleet enhancements, and unlocking new opportunities in upcoming quarters. The focus on premium services and a diverse operational portfolio positions Air Canada favorably in an increasingly competitive market.

This quarterly report highlights the airline’s commitment to not only recovering from the impacts of past challenges but also to achieving long-term strategic goals set for the future. The sustained commitment to excellence, operational efficiency, and customer satisfaction continues to be the pillars of Air Canada's business approach as it progresses through 2025 and beyond.