International Consolidated Airlines Group (IAG) Q1 2026 earnings summary

Executive summary

• Revenue grew by 1.9% year-over-year to €7,181 million in Q1 2026, with operating profit up 77.3% to €351 million and profit after tax up 71% to €301 million, reflecting strong demand across airlines and networks.

• Operating margin improved by 2.1 points to 4.9%, and net debt reduced to €4,183 million, with net leverage at 0.5x and liquidity at €12,731 million.

• Loyalty business revenue grew 10%, with profit up 32.6% at a 20.1% margin.

• The group is on track to return €1 billion in excess cash by February 2027.

• Strong demand was observed in premium cabins and transatlantic markets, with business travel delivering good revenue growth.

Financial highlights

• Operating profit for Q1 was €351 million, up €153 million year-over-year, driven by strong passenger revenue and early Easter holidays.

• Adjusted EPS increased by 56.5% to 3.6 euro cents, and adjusted profit after tax rose 71% year-over-year.

• Net debt reduced to €4,183 million at March-end, with net leverage at 0.5x and liquidity at €12,731 million.

• Passenger unit revenue increased 8.2% at constant currency and 3.5% on a reported basis.

• Total unit costs improved by 0.5%, with non-fuel unit costs down 0.9% and fuel unit costs up 0.9%.

Outlook and guidance

• Booked revenue for Q2 is at 80%, in line with historical levels, but capacity growth for Q2 and Q3 is now expected at ~1% and ~2%, respectively, lower than previous guidance.

• Total fuel cost for 2026 is forecast at €9 billion, €2 billion higher than prior scenario, with only 60% of the increase expected to be recovered through revenue and cost management.

• Free cash flow is expected to be below €3 billion for the year.

• Capex for 2026 is now expected at €3.5 billion, slightly down from previous guidance.

• Higher fuel costs are anticipated to lower profits and free cash flow versus prior guidance.