International Airlines Group (IAG) delivered strong financial performance in the first half of 2025, with revenue climbing 8.0% to €15.9 billion as the airline group capitalised on continued robust travel demand.
Operating profit before exceptional items surged 43.5% to €1.88 billion for the six-month period, while second-quarter operating profit jumped 35.4% to €1.68 billion. The company’s operating margin expanded by 2.9 percentage points to 11.8%, reflecting benefits from its ongoing transformation program.
“Our strong performance in the first half of 2025 reflects the resilience of demand for travel and the success of our ongoing transformation,” said Chief Executive Luis Gallego. He noted the company continues to benefit from “the trend of a structural shift in consumer spending towards travel.”
The airline group announced €1.5 billion in cash returns to shareholders for 2025 through dividends and share buybacks. IAG’s balance sheet remained strong with significant free cash flow generation, providing a major positive for investors.
Looking ahead, Gallego expressed confidence that the company will “deliver good earnings growth and margin progression for the full year.” As of July 29, IAG was 57% booked for the second half with booked revenue in line with the previous year.
The company reported robust demand across its core North Atlantic, Latin America and European markets, though noted “some softness in US point-of-sale economy leisure” that was being offset by strength in premium cabins.
“The airline industry has historically been a difficult place to make money, but IAG is a cut above most of the competition. IAG’s performance continued its skyward trajectory, with profits rising at high double-digit rates over the first half,” said Aarin Chiekrie, equity analyst, Hargreaves Lansdown.
“Its largest airline, British Airways, accounts for around 45% of the group’s operating profits and is benefitting from favourable supply and demand dynamics. With a large presence in a constrained London market, British Airways has strong pricing power and looks well-positioned to keep benefiting more than anyone from these dynamics. The group also has exposure to the booming Madrid-Latin America route through its second-largest airline, Iberia. Overall, performance across its airlines has been impressive, and with both fuel and day-to-day costs now forecast to come in below previous guidance, profits look set to continue moving higher.”
IAG shares rose more than 2% on Friday in early trade and are more than 140% higher over the past two years.