Air Canada’s second quarter featured “further improvements in the corporate recovery,” particularly on the Canada-U.S. sector, Air Canada SVP of revenue and network planning Mark Galardo said during a Wednesday morning earnings call.
“It’s important to note, our investment in the U.S. is longer-term in nature,” Galardo added. “Our new routes launched this here have performed in line with expectations. Our premium offering remains robust, with growth in premium cabin revenues outpacing the overall revenue growth.”
Corporate travel revenue for the quarter grew about 4 percent year over year, and the carrier is looking to September and October for continued momentum in recovery in the sector, which still is about 25 percent to 30 percent below where it was in 2019, Air Canada president and CEO Michael Rousseau said.
“The big question that we’re now asking ourselves is to what extent some of the network challenges that we have in terms of fleet contributing to that,” Rousseau said. “And that’s a bit of an exercise that we’re conducting internally, because some of our schedules have to facilitate same-day business travel.”
Rousseau added that the carrier must “make sure that we’re well set up to stimulate the corporate recovery as well.”
The majority of Air Canada’s capacity growth at the end of the third quarter and into the fourth “is going to be on the Pacific sector, where we see some strengths,” Rousseau said. “We’re also investing a bit into India. We’ve reduced our exposure to Europe, so we’re basically flat to negative. And we’re now taking another look at our domestic capacity for Q4. [It’s] too early to say exactly what 2025 will look like right now.”
Air Canada Q2 Metrics
Air Canada reported second-quarter operating revenue of more than C$5.5 billion, up 1.7 percent year over year. Passenger revenue was nearly C$5 billion, up 1.8 percent compared with Q2 2023. Net income was C$410 million compared with C$838 million a year prior.
Capacity increased about 6.5 percent year over year for the quarter, and the average fuel cost was C$1.04 per liter, according to Air Canada.
Air Canada projects a third-quarter capacity increase of 4 percent to 4.5 percent year over year. Full-year capacity is forecast to increase 5.5 percent to 6.5 percent compared with 2023. That range is down from prior guidance of 6 percent to 8 percent. Full-year average fuel cost is projected to be C$1.03 per liter.
