International Airlines Group reported "strong" transatlantic business travel demand in the fourth quarter, driving a 14 percent year-on-year profit increase.
The parent company of British Airways, Iberia, Aer Lingus, Level and Vueling expects transatlantic business demand to continue into 2026, with Q1 bookings "looking really well," according to group CEO Luis Gallego. This comes after the airline group reported a slowdown in transatlantic travel in the third quarter of 2025.
During an earnings call on Friday, outgoing finance chief Nicholas Cadbury addressed shifts in corporate travel demand across the group. "We're trying to move away from comparing ourselves to 2019, we think that's ancient history now," he stated. "All we can say is that we've seen corporate demand be strong in Q4, and in the early days of Q1 it's been good as well, which helps the yield curve. … And it's strong across all sectors, not just finance."
British Airways CEO Sean Doyle reported that corporate bookings from the U.S. were "strong," while transatlantic business demand from the UK was "robust" for both the fourth quarter of 2025 and early 2026. He also noted that travel demand from the U.S. to Europe remains "resilient."
Iberia also saw "very strong business evolution" on its transatlantic routes, according to CEO Marco Sansavini, despite some pressure in the fourth quarter due to increased competition.
Sansavini added the corporate travel market in Latin America has also "evolved… and saw strong gains", with business demand rising 7 percent year on year.
Q4 and full-year metrics
For the three months to Dec. 31, IAG's total capacity—measured in available seat kilometers—increased 2.4 percent compared to the previous year. This was lower than expected due to "reduced availability of engines for the long-haul fleet," the group said. For the full year, capacity rose by 1.8 percent year on year.
IAG reported a 4 percent increase in total revenue for the year, reaching €33.2 billion, and an operating profit of €5 billion. British Airways and Iberia were the biggest drivers of profit growth, with BA reporting an operating profit of £2.2 billion, up £182 million compared to 2024, while Iberia posted an operating profit of €1.3 billion, which marked a year-on-year increase of €446 million.
Aer Lingus also increased annual profits by €77 million to €282 million. Vueling, meanwhile, reported a €7 million year-on-year profit decline to €393 million due to weakened European summer demand.
In the fourth quarter, IAG's passenger revenue per available seat kilometer declined by 2.1 percent compared to a year prior, whereas annual passenger revenue per ASK increased marginally by 0.1 percent.
The airline group's outlook for 2026 remains positive. IAG expects capacity to increase by 3 percent in 2026, with plans to add 17 new aircraft this year. Gallego said he is "pretty sure" the supply chain will support these plans.