Global Airline Industry to Hit $36.6 Billion Profit in 2025, Driven by Lower Oil Prices and Rising Passen

The global airline industry is projected to report a net profit of USD 36.6 billion in 2025, slightly higher than expected this year, helped by lower oil prices and cost control, IATA said on Tuesday.

Passenger numbers are expected to rise 6.7 per cent to 5.2 billion next year compared to 2024. In 2025, the International Air Transport Association (IATA) expects the industry's revenue to cross the USD 1 trillion mark for the first time to USD 1.007 trillion, which will be an increase of 4.4 per cent compared to 2024.

While the operating profit is estimated at USD 67.5 billion, expenses are anticipated to reach USD 940 billion next year.

At a briefing here, IATA Director General Willie Walsh said India is witnessing significant growth and that there is a clear recognition that growth is also dependent on air connectivity.

China and India are among the fastest-growing domestic aviation markets, he added.

"Net profit is expected to be USD 36.6 billion in 2025 for a 3.6 per cent net profit margin. That is a slight improvement from the expected USD 31.5 billion net profit in 2024 (3.3 per cent net profit margin).

"Average net profit per passenger is expected to be USD 7 (below the USD 7.9 high in 2023 but an improvement from USD 6.4 in 2024)," IATA said in its financial outlook for 2025.

In the Asia Pacific region, a slight improvement in profitability is likely next year on the back of strong demand and increasing load factors.

Globally, IATA said the average airfare, including ancillaries, is expected to be USD 380, which is 1.8 per cent lower than 2024.

"We are expecting airlines to deliver a global profit of USD 36.6 billion in 2025.

"This will be hard earned as airlines take advantage of lower oil prices while keeping load factors above 83 per cent, tightly controlling costs, investing in decarbonisation, and managing the return to more normal growth levels following the extraordinary pandemic recovery," Walsh said.

In 2025, jet fuel price is expected to average USD 87 per barrel compared to USD 99 per barrel in 2024. This is based on a jet fuel crack spread of USD 12 per barrel and a crude oil price of USD 75 per barrel (Brent).

"Airlines' cumulative fuel spend is expected to be USD 248 billion, a decline of 4.8 per cent despite a 6 per cent rise in the amount of fuel expected to be consumed (107 billion gallons). Fuel is expected to account for 26.4 per cent of operating costs in 2025, down from 28.9 per cent in 2024," IATA said.

At the same time, Walsh said there are supply chain challenges, infrastructure deficiencies, onerous regulations and a rising tax burden.

IATA also mentioned that net profitability will be squeezed as airlines are expected to exhaust their tax losses carry forwards from the pandemic era, leading to an increase in tax rates in 2025.