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Revenue: Group revenues increased by nearly 10% to EUR9.3 billion.

Adjusted Operating Profit: EUR484 million.

Operating Margin: 5.2%.

Recurring Adjusted Operating Free Cash Flow: EUR920 million for the first half of the year.

Cash at Hand: More than EUR10 billion.

Passenger Unit Revenue: Up 8.9%.

Cargo Unit Revenue: Up 26.7%.

Transavia Unit Revenue: Up 1.6%.

Unit Cost: Up 1%.

Fuel Bill Impact: Increased by approximately EUR900 million compared to last year, with 86% recaptured.

Premium Cabins Revenue Share: 38.5% of total passenger revenues.

Business and La Premiere Revenue Growth: 11%.

Premium and Premium Comfort Revenue Growth: 13%.

Net Debt: Leverage down 0.1 compared to the beginning of the year.

Group Capacity Outlook: 2% to 3% growth.

Unit Cost Outlook: 0% to plus 2%.

CapEx Outlook: Below EUR3 billion.

Leverage Outlook: Between 1.5% to 2%.

Release Date: July 30, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Group revenues increased by nearly 10% to EUR9.3 billion, supported by growth across all businesses.

Premium cabins now represent 38.5% of total passenger revenues, with Business and La Premiere revenues growing 11% and Premium Comfort revenues up 13%.

Air France-KLM (AFLYY) successfully recaptured approximately 86% of the additional fuel bill through strong commercial performance and disciplined pricing.

Recurring adjusted operating free cash flow reached EUR920 million for the first half of the year, with cash at hand rising to over EUR10 billion.

KLM stabilized its results and showed a reduction in unit costs, indicating the ‘back on track’ program is becoming effective.

Negative Points

Higher fuel prices weighed on Q2 profitability, with the fuel bill increasing by approximately EUR900 million compared to last year.

Adjusted operating profit fell to EUR484 million, representing an operating margin of 5.2%.

Transavia struggled to offset fuel cost increases, with unit revenue up only 1.6% against a needed ~10% to recapture fuel impact.

Supply chain issues, particularly a lack of spare parts for engines, led to higher maintenance costs and hampered maintenance business results.

Bookings for Q3 show a drop of 2% for long-haul and short/medium-haul, with a trend toward later bookings due to higher ticket prices.

Q & A Highlights

Here are the key highlights from the Air France-KLM (AFLYY) H1 2026 earnings call, focusing on the most critical Q&A exchanges.

Q: On the TAP Air Portugal bid, how have you differentiated your offer from Lufthansa’s, and what gives you confidence in your approach? A: (Benjamin Smith, CEO) We believe our decentralized group model is a key strength, as demonstrated by our successful 21-year history with KLM, where the brand and strategic jobs were preserved. We have invested heavily in the KLM brand, which has paid off. For TAP, we have seen public support from Portuguese unions who are nervous about the other bidder, contrasting with our strong alignment with staff over the last eight years. Our bid is for a strategic minority stake (up to 49.9%) that will go through a merger process, allowing us to realize full synergies in network, cargo, and MRO, unlike our current minority stake in SAS.

Q: You mentioned July yields are up 7% and load factors down 1%. Given the recent fuel price increase, why aren’t yields higher, and how should we view August and September? A: (Steven Zaat, CFO) A 7% yield increase is actually quite strong given the current fuel price environment. You must consider that fuel is not 100% of our unit cost, so the recapture rate is reasonable. Regarding the summer months, August is typically a bit softer than July, but September looks better than August. The late booking trend is favorable for yields, so the final two weeks of booking will be critical for pricing.

Q: How long can premium revenues continue to outgrow economy, and what is the risk of yield compression as competitors also invest in premium products? A: (Benjamin Smith, CEO) The momentum is strong and sustainable. We are retrofitting existing fleets and new aircraft with a higher percentage of premium seats. The strength of the U.S. dollar and the growing attractiveness of the Air France brand are major drivers. For KLM, Premium Comfort was introduced late, so it has a very low base and significant room for growth. Premium economy is often the highest-yielding real estate on the aircraft, so this trend is supported by structural demand.

Q: What are your yield expectations for the North Atlantic for the rest of the year, and have the dynamics between U.S. and European point-of-sale changed? A: (Steven Zaat, CFO) We still expect strong pricing on the North Atlantic. Our U.S. competitors are not hedged against fuel, so they need higher yields to cover costs, which supports our pricing power. The U.S. point-of-sale is getting stronger, and we are now at a point where nearly two-thirds of our passengers on U.S. routes are American. This trend is continuing.

Q: Regarding the proposed ADP (Aeroports de Paris) tariff increase of CPI + 2.1% from 2027 to 2034, are you comfortable with this plan? A: (Benjamin Smith, CEO) We fully support this long-term economic agreement. It provides the visibility needed for critical investments at Paris Charles de Gaulle, which have been lacking since the opening of Terminal 2E in 2012. The plan focuses on key priorities like optimizing passenger flows, increasing contact stands, and improving intermodal connectivity. We have worked closely with ADP on this program and believe it is necessary to strengthen the efficiency of our hub.

Q: You mentioned unit costs are up 1%, in line with guidance, but maintenance costs are a headwind. How should we think about this trend into Q3 and Q4? A: (Steven Zaat, CFO) The trend of higher maintenance costs will continue in the second half of the year, as we don’t expect the OEM supply chain issues to resolve quickly. However, this is offset by other operational measures. We are seeing benefits from fuel efficiency from our new fleet, fewer wet leases in the summer, and better operational performance leading to lower customer compensation costs. All of this keeps us within our 0% to 2% unit cost guidance for the full year.

Q: On the cargo business, how do you view supply-demand dynamics going forward, and do you expect the market to remain structurally tight? A: (Steven Zaat, CFO) We don’t expect a major change in supply and demand. Most capacity is in the belly of passenger aircraft, and that is not fully sold out except on our Asian network. While Middle East freighter capacity is back, some forwarders may still prefer air freight over shipping for security and reliability. The additional contribution from cargo in Q2 was around 100 million, which is helping our long-haul network profitability significantly.

Q: KLM’s results improved this quarter, but the progress toward the 8% margin target by 2027 seems slow. How do you plan to reach that target? A: (Marianne Rintel, KLM CEO) The improvement shows that our “Back on Track” program is having an effect. We are seeing strong cost discipline, productivity improvements, and a full program of achievements in a very insecure world. It is a step-by-step process, and we are progressing. (Steven Zaat, CFO) The improvement is not just from fuel hedging; it is also coming from better unit revenue and a decrease in unit costs. It is a promising first step toward the 8% margin target.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.