Finnair Q2 2025 results and Q&A

We published our Half-Year Report for January–June 2025 on 16 July.

The challenges we encountered early in the year continued into Q2. Despite this, we carried over 3 million passengers and achieved a slight increase in revenue compared to the same period last year. However, our comparable operating result was significantly impacted by industrial action — first by the Finnish Airline Pilots’ Association in April, followed by the Finnish Aviation Union (IAU) representing ground service personnel in May and June.

During the quarter, we successfully concluded collective labour agreements with our pilots, cabin crew, and travel agency staff. After the reporting period, an agreement was also reached between the Service Sector Employers Palta and the IAU. With these agreements in place, we are once again able to operate with the reliability our customers expect.

The direct financial impact of the industrial action on Q2 included approximately 41 million euros in lost revenue, 10 million euros in reduced other operating income, and a 29 million euro hit to our comparable operating result. Over 1,300 flights were cancelled, leading to costs related to rerouting, customer care, and compensation. To support our customers, we offered flexible rebooking options, which also affected sales on rescheduled travel days. The uncertainty surrounding the disruptions had a broader effect on demand and customer satisfaction.

Despite these challenges, our operational performance remained strong, and we operated 94% of our flights as planned.

Market Trends and Clarified Guidance

General market uncertainty increased during the quarter, particularly affecting demand for transatlantic travel. Booking windows shortened, and while our North American traffic grew, it did so at a slower pace than anticipated, with average fares declining. In other markets, demand developed in line with expectations.

Following the resolution of industrial action, we’ve clarified our guidance for 2025. Excluding the direct impact of the strikes, we have anticipated a ~10% increase in capacity (ASKs), revenue between 3.3–3.4 billion euros and comparable operating result between 100–200 million euros.

However, when factoring in the direct effects of the industrial action, we anticipate ~5% capacity growth, revenue between 3.2–3.3 billion euros and comparable operating result between 30–130 million euros.

Q&A Highlights

How quickly can you adjust capacity if North Atlantic demand remains soft?

We’ve already scaled back our summer schedule in that region, where most of our growth had been planned. Further adjustments will depend on how demand evolves through the rest of the summer. We’ll assess this carefully in Q3, considering operational stability, network connectivity, and cash flow.

What’s the outlook for the Asian market?

We’re pleased with our performance in Asia. This summer, we increased our weekly flights to Japan to 25, making us the largest carrier between Japan and Europe. The added capacity has been well received, with revenue growing faster than capacity.

Why did the labour negotiations take so long?

This round of negotiations was particularly complex. The aviation industry has undergone major changes in recent years, from the pandemic to geopolitical shifts, leaving unresolved issues. Labour market dynamics in Finland have also evolved. While we would have preferred a quicker resolution, we’re now focused on moving forward.

How long do the new agreements ensure labour peace?

The agreements with the Finnish Airline Pilots’ Association and the Finnish Transport Workers’ Union (for cabin crew) are valid for three years, with the final year subject to termination. The agreement with the IAU runs until January 2027. With these in place, we aim to engage in ongoing dialogue to modernise the agreements and avoid future disruptions.

Have customers been hesitant to book flights due to the industrial action?

Yes, we’ve seen some hesitation, especially as the nature of the industrial action evolved. Some travellers explored alternative transport options. To support our customers’ travel plans, we paused ticket sales for affected days and offered flexible rebooking. Now that operations have stabilised, we’re focused on restoring confidence.

What’s the status of your strategy update and fleet renewal?

Despite recent disruptions, we’ve continued to make progress. We’re actively refining our strategy and modelling the optimal fleet composition to support our future business needs. We expect to share more concrete updates later this year.