Finnair half-year report 2026 shows stronger earnings

The Finnair half-year report 2026 shows a sharp improvement in revenue, profitability, passenger volumes, and operating cash flow, while a reduced capacity plan and Middle East uncertainty leave the second half less predictable than the first.

Second-quarter earnings improved across the core measures

Finnair reported second-quarter revenue of €916.7 million, up 16.4% from €787.7 million in the same period last year. The comparable operating result reached €78.4 million, compared with €10.3 million a year earlier. The company described the latest result as a record high.

The prior-year comparison was affected by industrial action, which reduced the comparable operating result by approximately €29 million. Even with that distortion in the base period, the latest quarter showed broader improvement across profitability, cash generation, passenger traffic, and aircraft utilization.

Key figures for April through June were:

• Operating profit increased to €86.6 million from €19.2 million.

• Earnings per share rose to €0.28 from €0.06.

• Operating cash flow reached €182.6 million, compared with €43.7 million.

• Gross capital expenditure was €71.6 million, slightly below €72.2 million.

• Passenger volume advanced 7.6% to 3.3 million from 3.1 million.

• Available seat kilometers increased 2.0% to 10,411.3 million, although capacity including wet leases declined 2.0%.

• Passenger load factor improved by 3.4 percentage points to 79.9% from 76.6%.

Revenue grew faster than the airline's reported capacity, while the higher load factor indicates that a larger share of available seats was occupied. Management attributed the quarter to disciplined execution and favorable market conditions, including healthy travel demand and temporary changes in competing capacity, particularly within Asian traffic.

Cargo demand and ancillary revenue also supported the performance. Finnair expanded its selection of additional services and introduced new product bundles during the quarter. It also automated parts of the customer journey, with particular attention to handling disruptions.

First-half cash generation accompanied the profit recovery

The improvement was also visible across the full January-to-June period. Revenue rose 14.4% to €1,694.8 million from €1,481.9 million, and the comparable operating result moved to a profit of €77.8 million from a loss of €52.3 million.

Industrial action had reduced the prior-year first-half comparable result by about €51 million. Finnair still recorded a substantial year-over-year recovery after accounting for that difficult comparison.

First-half measures included:

• Operating profit of €90.2 million, reversing a €34.2 million loss.

• Earnings per share of €0.24, compared with a loss per share of €0.19.

• Operating cash flow of €456.5 million, up from €235.8 million.

• Gross capital expenditure of €173.3 million, compared with €124.5 million.

• Passenger volume of 6.1 million, a 7.4% increase from 5.7 million.

• Available seat kilometers of 19,865.5 million, up 2.7%; capacity including wet leases increased 0.9%.

• Passenger load factor of 79.0%, an improvement of 3.8 percentage points from 75.2%.

The Finnair half-year report 2026 therefore reflects more than a favorable second quarter. The airline generated stronger cash flow and carried more passengers across the entire six-month period, while improving the proportion of capacity filled.

Capital spending also increased during the first half, even though second-quarter expenditure was slightly lower than in the comparison period. The difference between Finnair's reported capacity and capacity including wet leases is relevant when reading the operating figures. During the second quarter, the company's available seat kilometers increased, but the measure declined after wet leases were included. Across the full first half, both measures grew, although the wet-lease-adjusted increase was smaller.

Demand and temporary capacity shifts supported unit revenue

Chief Executive Officer Turkka Kuusisto said Asian traffic benefited when temporary market-capacity changes created room for higher unit revenue. Cargo services remained in solid demand, while ancillary products continued to grow.

Kuusisto characterized the quarter as exceptionally strong, supported by Finnair's execution and a favorable demand environment.

The summer season also began with high activity. More than 44,000 customers travel through Finnair's network on its busiest summer days, increasing the operational importance of reliability and smooth passenger handling.

Customer satisfaction improved during the quarter, while the airline's Net Promoter Score remained at 42. Employee engagement also developed positively. Management presented these measures as support for the company's ability to execute its strategy while maintaining daily operations.

Finnair connected the improvement in ancillary revenue with new services and product bundles. Its process changes were intended to simplify customer interactions at several stages of a trip, while automation focused especially on disruption handling. Together with the customer and employee indicators, those measures formed part of management's account of the quarter's operational progress.

The capacity plan now reflects Middle East cancellations

Finnair reduced its expected 2026 capacity growth. It now plans to expand total capacity, measured by available seat kilometers, by approximately 1%, including agreed wet-lease arrangements. In April, the company had expected growth of about 3%.

The lower estimate reflects canceled Middle East flights. Finnair still expects passenger numbers within its own traffic to increase by approximately 7% during 2026, while global air travel is expected to continue growing.

The changed capacity forecast does not alter the central revenue and earnings ranges. Finnair now expects 2026 revenue between €3.4 billion and €3.5 billion, above its previous range of €3.3 billion to €3.4 billion. Comparable operating profit guidance remains €120 million to €190 million.

The revision combines a higher expected revenue range with unchanged comparable operating profit guidance. It also separates expected passenger growth from the lower capacity plan: traffic within Finnair's own operations is still projected to expand faster than total available seat kilometers.

That guidance assumes no material interruption to fuel availability. This condition matters because conflict, political instability, and potential trade disputes continue to create uncertainty around the operating environment.

Fuel remains the main constraint on visibility

Management said the outlook for the rest of 2026 is more uncertain than usual because of developments in the Middle East. A prolonged conflict or extended peace negotiations could affect both fuel prices and availability. Either outcome could reduce capacity or weaken financial performance.

Fuel costs were volatile during the second quarter, but Finnair's hedging program limited part of the exposure. The company had hedged 82% of second-quarter fuel purchases and reported an 81% hedge ratio for the third quarter.

The airline has not observed fuel-related interruptions to its operations, and availability has remained stable. It is seeking to protect supply through established relationships with fuel providers. Even so, management expects fuel movements, geopolitical developments, and normalization from favorable first-half market conditions to potentially pressure demand, pricing, and profitability.

Finnair's operating result is also exposed to currency movements. A stronger U.S. dollar against the euro has a negative effect, while a weaker dollar is beneficial. Under the sensitivity figures previously issued in April, a 10% change in fuel prices represented a €39 million effect on annual comparable operating profit after hedging. A 10% euro-dollar movement represented a €38 million effect. Those calculations covered the rolling 12 months following the reporting date.

Environmental regulation represents another cost burden. Finnair expects the related expenses to continue weighing on profitability during the year.

Fleet and network investments support measured expansion

Finnair is preparing to introduce Embraer E195-E2 aircraft and has signed letters of intent to lease six Airbus A320ceo aircraft. The narrow-body fleet renewal is intended to support network development, growth, and dependable operations.

The airline also decided to resume service to Turku and Tampere. Those routes will connect two Finnish regional growth centers with Finnair's international network and onward service to more than 100 destinations.

These plans sit alongside higher first-half capital expenditure. The balance is clear: Finnair is investing in its network and fleet while keeping its full-year outlook conditional on fuel access and a geopolitical environment that remains difficult to forecast.

Strong results do not remove second-half uncertainty

Finnair entered the second half with higher revenue, better load factors, stronger operating cash flow, and a return to first-half profitability. The company also raised its revenue range for 2026 while maintaining its comparable operating profit guidance.

The strongest conditions of the first six months may not persist. Reduced capacity growth, Middle East disruption, fuel exposure, environmental costs, and a possible normalization in pricing conditions now define the balance of the year. Finnair's next scheduled financial update, covering January through September 2026, is due on October 27, 2026.