What are the 10 most profitable airlines in the world? Stiff competition is the order of the day in the aviation industry as airlines battle it out for travelers dollars in the race for profits. In the highly competitive field, United States based airlines continue to dominate the list of the most profitable airlines in the world. The dominance stems from the fact that they are the biggest airlines in the world in 2019 backed by one of the most developed travel industry.
In an industry where there are more than 200 airlines, we had to base our listing of the most profitable airlines, on companies that make their earnings public. In narrowing the list, we also centered on household names with a global touch when it comes to air services.
In our list of the most profitable airlines in the world, we have based our listing on the total amount of profits generated in 2018. Also, we have reported the revenues generated as well as the total flights operated, which affirms their dominance in the industry.
The list of the most profitable airlines in the world also takes into consideration the number of aircraft as well as flights that an airline operates. With the listing, it became increasingly clear that the most profitable airlines in the world are the ones with flights to more destination around the world.
To ensure that our ranking was based on the latest data, we crosschecked with releases from reputable media outlets such as Business Insider and Consultancy.uk.
US airlines file quarterly financial reports with the Bureau of Transportation Statistics (BTS). That’s why we can see the long-term trends in US airlines’ profitability through time. The entire US airline industry generated a total after-tax profit of $25 billion in 2015. Unfortunately that figure withered down to $11.8 billion through 2018. That’s why airline investors have been frustrated in recent years. For example American Airlines Group Inc. (NASDAQ:AAL) shares lost 50% of their value over the last 2 years. Price competition is good for passengers, but not for investors. The chart below shows the total US airline industry profits by year.
During the fourth quarter of 2018, US airlines received total passenger revenues of nearly $26 billion. They also generated $919 million from baggage charges, $460 million from reservation changes, and $263 million from cargo. Total quarterly revenue for the domestic US airline industry was $36.8 billion. The biggest expense item for US airlines wasn’t fuel ($6 billion), it was labor ($10.6 billion). US airlines generated pre-tex income of $3 billion and net income of $2.4 billion in Q4 of 2018. That’s a decline of 49% compared to the fourth quarter of 2017. This numbers tells us that US airline stocks aren’t the best place to invest your savings.
Insider Monkey follows corporate insiders and hedge funds to identify profitable investment ideas in advance. In addition to following the biggest hedge funds for investment ideas, we also share stock pitches from conferences, investor letters and other sources. We also compile lists like 10 largest airports in the world in 2019 and 10 most profitable franchises in the world to broaden our horizon and identify emerging trends in advance.
Here is our list of the 10 Most Profitable Airlines In The World 2019.
#10 Emirates Airlines
Owned by the government of Dubai Investment Corporation of Dubai, Emirates opens the list as the tenth most profitable airline in the world. Operating more than 3,600 flights every week, it is rated as the largest airline in the Middle East.
Based at Dubai International Airport, the airline carries passengers to more than 150 cities in 80 countries. In addition to being one of the most profitable airlines in the world, Emirates Airlines is ranked as the fourth-largest airline by revenue passenger-kilometers flown. It is the second-largest when it comes to freight-tone kilometers flown.
As one of the most profitable airlines in the world, Emirates generated revenues amounting to $29.8 billion in 2018, leading to a net profit of $237 million.
#9 Air France KLM
Air France LM is one of the biggest airlines in the world formed following the merger of Air France and KLM. The airline operates from two major hubs, the Amsterdam Airport Schiphol, where KLM is headquartered, and Paris Charles de Gaulle Airport, where Air France has its base.
In 2018, the airline group carried more than 100 million passengers affirming its position as a leading European airline group. The group registered a 150% increase in profits in 2018 that came in at $463 million.
#8 China Southern Airline
China Southern is one of China’s biggest airlines, headquartered in Guangzhou. Formed following the merger of a number of domestic airlines, the airline has risen to become one of the biggest airlines in the world and one of the most profitable.
In 2018 the airline generated $21.7 billion in revenues leading to a net profit of $509 million.
#7 American Airlines
Headquartered in Dallas-Fort Worth, American Airlines is one of the world’s largest airline by fleet size as well as revenue generated and passengers carried annually. Together with its partner airlines, the airline operates an extensive network of 6.800 flights daily, covering 350 destinations in over 50 countries.
While operating from ten hubs, American Airlines handles more than 200 million passengers annually, which translates to about 500,000 passengers daily.
In 2018, American Airlines generated $44.6 billion in operating revenues, leading to a pre-tax profit of $1.9 billion.
#6 United Airlines Holdings
Headquartered in Chicago, Illinois, United Airlines Holdings Inc. (NASDAQ:UAL) is one of the biggest airlines in the world and also one of the most profitable. The airline operates a vast domestic and international route network with extensive focus on the Asia Pacific.
As one of the most profitable airlines in the world, United Airlines generated a net income of $2.1 billion in 2018 after setting a new record on the most revenue passengers ever. The airline achieved a record completion rate on completing more than 1.7 million flights.
#5 Lufthansa
German flagship carrier Lufthansa is one of the biggest airlines in the world. Besides, it is one of the most profitable airlines. It is the largest airline in Europe in terms of passengers carried.
Headquartered in Cologne Germany, the airline has over 700 aircraft and a member of the Star Alliance. The airline generated a profit of $2.5 billion in 2018, affirming its credentials as one of the most profitable airlines in the world.
#4 Southwest Airlines
Southwest Airlines Co (NYSE:LUV) is the only low-cost airline in our list of the most profitable airlines in the world. Headquartered in Dallas, Texas, it operates more than 4,000 departures during the peak travel season. Unlike the other big airlines, South West Airlines operates mainly in the U.S, focusing on domestic passengers. The airline maintains operations in over 100 destinations across the U.S and ten additional countries.
The airline generated a net income amounting to $2.5 billion in 2018, slightly lower from a net income of $3.4 billion recorded in 2017.
#3 International Airlines Group
As one of the biggest airlines in the world, International Airlines Group came into being following the merger of British Airways and the U.K flagship carrier and Iberia, Spain’s flagship carrier. Registered in Madrid Spain, the airline group has its operational headquarters in the U.K.
Ranked as the sixth-largest airline in the world, IAG reported a pre-tax profit of $3.5 billion in 2018, affirming its credentials as one of the most profitable airlines in the world. Listed in the London Stock Exchange, the airline is the sixth-largest in the world.
#2 FedEx
FedEx Corporation (NYSE:FDX) is a U.S airline service that specializes in providing courier delivery services. Headquartered in Memphis, Tennessee, the airline service is best known for its shipping service as well as pioneer service for tracking packages.
The FedEx Express segment offers airline-shipping services of packages as well as freight. In 2018, the airline generated $65.5 billion in revenues leading to a net income of $4.57 billion.
#1 Delta Airlines
Delta Air Lines, Inc. (NYSE: DAL) is the most profitable airline in the world. Headquartered in Atlanta, Georgia, the airline operates over 5,400 flights annually, serving 325 destinations in 52 countries. As a founding’ member of the Sky Team airline alliance, the airline operates from nine hubs, with Atlanta being the biggest.
It is one of the most profitable airlines in the world, given the number of passengers it carries annually as well as revenue passenger-kilometers flown. It also boasts one of the largest fleets. The airline generated $5.2 billion in pre-tax profit in 2018, propelling it to the first spot as the most profitable airline.
Disclosure: None. 10 Most Profitable Airlines In The World: 2019 Rankings is originally published at Insider Monkey.
