IATA: Airline financial performance in 2023 is beating expectations; USD9.8 bn net profit predicted

The International Air Transport Association (IATA) has announced an expected strengthening of airline industry profitability in an upgrade of its outlook for 2023. Airline industry net profits are expected to reach USD9.8 billion in 2023 (1.2% net profit margin) which is more than double the previous forecast of USD4.7 billion from Dec-2022.

Stronger profitability is supported by several positive developments, including China lifting COVID-19 restrictions earlier in the year than anticipated; cargo revenues remaining above pre-pandemic levels even though volumes have not; and on cost side, jet fuel prices, although still high, have moderated over the first half of the year.

Total revenues are expected to grow 9.7% year over year to USD803 billion. This is the first time that industry revenues will top the USD800 billion mark since 2019 (USD838 billion). Expense growth is expected to be contained to an 8.1% annual increase.

Around 4.35 billion people are expected to travel in 2023, which is closing in on the 4.54 billion who flew in 2019.