Air France-KLM third-quarter results and KLM restructuring plan, Digi Mart USA News: Air France-KLM shares surged nearly 12% to 12.6 euros in Paris on Thursday after the airline group reported third-quarter operating profit above expectations. The stock was among the best performers on the SBF 120 index, which was up 0.57%.
Air France-KLM posted third-quarter operating profit of 1.34 billion euros, compared with 1.1 billion euros expected by analysts according to a consensus compiled by the group. The result was driven largely by strong demand for direct flights to India, Asia and East Africa and the success of the company’s premium offering.
KLM, the Dutch subsidiary that merged with Air France in 2004, unveiled an ambitious restructuring plan aimed at raising its annual earnings by one billion euros. The airline said it intends to reduce its workforce by roughly 15% over the coming years to improve profitability and fund investment in new aircraft.
According to KLM, about 4,000 positions will be transferred to partners, including catering companies and the Air France-KLM holding company, while about 1,000 jobs will be eliminated under a plan to improve productivity. KLM has already carried out several rounds of job cuts in recent years, including the removal of 250 administrative positions in 2025.
KLM chief financial officer Bas Brouns said improving annual earnings by one billion euros was essential to implementing the company’s strategy, describing the measures as “profound” and “sometimes painful.” KLM has faced operational difficulties at its Amsterdam hub for several years, affected by air traffic restrictions and challenges in recovering from the pandemic.
The group lowered its 2026 capacity guidance to 2%, from a previous range of 2% to 3%. Its fuel bill for 2026 is now expected to reach 9.2 billion dollars, up from an earlier estimate of 8.9 billion dollars.
Analysts at Bernstein said the results were supported by a favorable pricing environment and good cost control, highlighting strong demand for premium cabins. Deutsche Bank analysts described the results as good quality, citing encouraging progress on cost reduction and KLM’s recovery, and noted that a 7% rise in unit revenue also benefited from external factors such as geopolitical tensions, freight disruptions and certain event-related effects.
European airlines face rising fuel costs, although network carriers such as Air France-KLM and Lufthansa have so far held up better thanks to fuel hedging and investment in higher-margin premium products. Spot jet fuel prices in Northwest Europe fell 12% this week to their lowest level since August, following a drop in oil prices.
