IATA: Apple makes more money on iPhone cases than airlines make on passengers

The International Air Transport Association (IATA) forecasts that airline net profit margins will remain at 3.9% in 2026, IATA Senior Vice President of Sustainability and Chief Economist Marie Owens Thomsen said at IATA Global Media Day, Report informs.

According to her, airline net profits are expected to reach $41 billion in 2026, up from $39.5 billion in 2025.

"Despite the new record, net profit margins will remain unchanged at 3.9%. Net profit per passenger carried is forecast at $7.90, below the 2023 peak of $8.50, and unchanged from 2025," Thomsen said.

IATA expects operating profit to be $72.8 billion in 2026 (up from $67 billion in 2025), operating margin to be -6.9%, higher than the expected 6.6% in 2025, and return on invested capital (ROIC) to reach 6.8%, the same as in 2025.

"Despite reduced leverage and improved operating margins, ROIC is expected to remain below the weighted average cost of capital (WACC), which is 8.2% for 2026. Total industry revenue is projected to reach $1.053 trillion in 2026, 4.5% higher than the expected revenue of $1.008 trillion in 2025," she said.

Thomsen added that load factors will continue to set records, with airlines filling 83.8% of all seats.

"Passenger numbers are expected to reach 5.2 billion in 2026 (up 4.4% from 2025), and cargo volumes are expected to reach 71.6 million tonnes in 2026 (up 2.4%)," the senior vice president added.

Commenting on the forecasts, IATA Director General Willie Walsh noted that while airlines' strong performance in a changing and challenging operating environment is impressive, the industry's profitability still falls short of covering its cost of capital.

"Industry profitability remains extremely low, especially considering its contribution-nearly 4% of the global economy and 87 million jobs. Yet, Apple makes more money selling an iPhone case than an airline makes carrying a passenger for $7.90," he said.

Walsh also highlighted the imbalance in profitability within the industry chain: engine and avionics manufacturers, as well as service providers, demonstrate significantly higher margins.

"If we could rebalance the value chain, reduce regulatory and tax burdens, and improve infrastructure efficiency, airlines could significantly increase their contribution to the global economy," he noted.