Korean Airlines (003490) Q2 2026 earnings summary

Executive summary

• Revenue increased 26% year-over-year to KRW 5.02 trillion in 2Q 2026, driven by strong passenger and cargo demand.

• Achieved consolidated revenue of KRW 13.89 trillion for H1 2026, up 9.3% year-over-year, despite geopolitical and cost headwinds.

• Operating income declined 34% year-over-year to KRW 261.8 billion in 2Q 2026, with margin falling to 5.2% due to higher fuel costs.

• Net income turned negative at -KRW 97.3 billion in 2Q 2026, and net loss attributable to owners of parent was KRW 266.1 billion for H1 2026, impacted by FX losses and higher expenses.

• Major event: Approval and execution of merger with Asiana Airlines, with integration processes underway and expected completion by end of 2026.

Financial highlights

• Total assets grew 6.8% to KRW 41.1 trillion compared to end-2025, with cash equivalents up 14.4%.

• Financial debt rose 12.5% to KRW 18.0 trillion, mainly due to new aircraft acquisitions.

• Net debt increased 12% to KRW 14.0 trillion.

• Cash and cash equivalents: KRW 2.60 trillion at period end.

• Liabilities to equity ratio rose from 244% to 271%.

Outlook and guidance

• Passenger demand expected to remain strong, supported by inbound traffic and recovering outbound demand as fuel surcharges ease.

• Cargo business to focus on high-value and heavy cargo, leveraging AI investment and semiconductor demand.

• Cost structure improvements anticipated from normalized oil prices and integration synergies.

• Management expects continued volatility in fuel prices and exchange rates due to geopolitical risks.

• Integration with Asiana Airlines is expected to deliver synergies and cost efficiencies, with full merger completion targeted for December 2026.