In the first half of 2025, IAG’s financial performance has resulted in a profit of 1.301 billion euros, a 43.8% increase when compared to the same time in 2024. In 2024, the profit was 905 million euros. This is the first time since the pandemic that the company made a profit in its quarter earnings.
IAG’s financial performance
In terms of revenue, there was an 8% improvement from 14.724 billion euros in the first half of last year to 15.906 billion euros in the first half of 2025. This shows that IAG’s airlines are becoming more popular with customers. In addition, the fact that revenue has increased but profit has increased to a greater extent indicates that cost control has also improved.
The situation has not always been so easy for the company. During the pandemic, IAG’s financial performance, like many, was severely affected due to governments restricting international travel. In the aftermath, the subsequent surge in demand and resulting staff shortages (as many had been laid off during the pandemic when demand was less) meant that the recovery took time, as airports had to restrict flight numbers to reduce congestion. British Airways, one of IAG’s subsidiaries, was credited for taking the initiative to voluntarily reduce flight numbers before mandatory restrictions came in.
Further Investments
Now that IAG is well and truly back in the black, there are ambitious plans for IAG’s investments. In Latin America (which includes Mexico and Central American countries), IAG’s growth in 2024 resulted in a 16% increase in seat capacity (number of seats available). In the first half of 2025, there has already been a 7% increase in seat capacity. There is also expansion taking place in North America, with growth in seat capacity of 1.1%. In Europe, IAG’s growth was overall 2.8% in terms of seat capacity for flights within Europe in general and 3.5% for flights domestically within Spain.
IAG is also strengthening its airline value by investing in improving its customer experience. British Airways, for example, has refreshed lounges in Lagos, Seattle, Singapore and Washington Dulles airport in the first half of 2025. It has plans to refit its Dubai and Miami lounges in the second half of the year. Aer Lingus, another IAG subsidiary, is introducing artificial intelligence (which is essentially technology-assisted customer service) to provide customers with a quicker service. In addition, the airline is also introducing a self-service tool for hotel accommodation to use in the event of disruption. Iberia, the Spanish flagship carrier and another subsidiary of IAG, is rolling out free Wi-Fi to its club members. Finally, Vueling, another Spanish subsidiary, is rolling out onboard Wi-Fi.
IAG’s airlines are also investing in improving their operational performance, with British Airways and Aer Lingus having both improved in their punctuality. Iberia and Vueling also remain among the most punctual airlines in the world. IAG is also investing in modernising its fleet to reduce fuel consumption, providing more up-to-date cabins for customers and reducing carbon emissions.
Reducing Carbon Emissions
In addition to modernising its fleet, IAG is also taking other steps to reduce carbon emissions. IAG reports that it is progressing towards its aim to have net-zero carbon emissions by 2050. This means that on balance, it is on track to have no carbon emissions by this time. In the first half of 2025, the company secured 200,000 tonnes of Sustainable Aviation Fuel, which was a 25 % increase year-on-year. Sustainable aviation fuel is made from ethanol and other plant extracts and has a lower carbon footprint when compared to traditional jet fuel.
As one can see, this is a positive story for IAG’s financial performance. IAG is no longer well and truly in the black in terms of its financial bottom line. It is also making further investments to improve the customer experience and expand its reach. We have to wait to see how this progresses.
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