Air Canada (AC) Q2 2026 earnings summary

Executive summary

• Achieved record Q2 operating revenues of CAD 6.3 billion (USD 6.3 billion), up 11% year-over-year, driven by strong demand, especially in premium and corporate travel segments, and supported by diversified revenue streams including Cargo, Vacations, and Aeroplan.

• Adjusted EBITDA reached CAD 719 million (USD 719 million, 11.5% margin), at the upper end of guidance, despite a 49% year-over-year increase in fuel expense.

• Announced a 25% minority equity sale in Aeroplan for CAD 2.5 billion, valuing the program at CAD 10 billion, strengthening the balance sheet and accelerating the path to investment grade.

• Concluded four-year labor agreements with major unions, supporting cost structure stability and strategic objectives.

• Welcomed 12.0 million revenue passengers, a 4.2% increase year-over-year.

Financial highlights

• Operating revenues: CAD 6.3 billion (USD 6.266 billion); operating expenses: USD 6.481 billion.

• Adjusted EBITDA: CAD 719 million (USD 719 million, 11.5% margin); operating loss: USD 215 million.

• Net loss: USD 178 million; diluted loss per share: USD 0.63; adjusted earnings per diluted share: USD 0.40.

• Generated CAD 651 million (USD 651 million) in operating cash flow and CAD 174 million (USD 174 million) in free cash flow.

• Ended Q2 with CAD 8.9 billion (USD 8.91 billion) in liquidity and net leverage ratio of 1.7x.

Outlook and guidance

• Reinstated 2026 guidance: full-year ASMs growth of 2.25%-3.25%, adjusted CASM up 5%-6% year-over-year, and adjusted EBITDA expected between CAD 2.9 billion and CAD 3.2 billion.

• Free cash flow guidance for 2026 is CAD 200 million to CAD 500 million, assuming CAD 1 billion in sale and leaseback transactions.

• Q3 and Q4 fuel price assumptions: CAD 1.38 and CAD 1.29 per liter, respectively.

• 2028 target: operating revenues ~$30 billion, adjusted EBITDA margin ≥17%; 2030 aspiration: operating revenues >$30 billion, adjusted EBITDA margin 18–20%.