In brief
Japan Airlines cut its quarterly net profit by more than two‑fifths, falling to 39.07 billion yen, while revenue rose 11.7%. The airline blamed a spike in fuel prices and the persistent depreciation of the yen for higher expenses, and it maintained a 20% lower full‑year profit forecast. The report raises questions about the airline’s long‑term strategy and its ability to balance passenger growth with cost pressures.
Japan Airlines (JAL) disclosed on Monday that its net profit for the first half of the 2026–27 financial year fell 42.2 percent from a year earlier to 39.07 billion yen (about US$247 million). The loss was attributed to a sharp rise in fuel costs and the continued weakening of the Japanese yen, both of which amplified the airline’s operating expenses.
The announcement was made in Tokyo, where JAL’s chief financial officer highlighted that the company’s revenue increased 11.7 percent to 1.10 trillion yen during the April–September period. Among the revenue drivers, international passenger earnings grew 16.0 percent to 426.6 billion yen, while domestic passenger revenue expanded 5.8 percent to 319.7 billion yen.
Despite the uptick in sales, passenger volumes slipped. International travelers dropped 3.1 percent to 3.86 million, and domestic passengers fell 2.2 percent to 18.70 million. The paradox of higher revenue but fewer passengers suggests that ticket prices may have risen, a move that is commonly used by airlines to offset cost hikes.
Operating expenses, however, climbed 16.5 percent year‑on‑year to 1.038 trillion yen. JAL cited soaring fuel prices as a primary driver. Fuel, which constitutes a sizeable share of an airline’s cost structure, surged in the period, squeezing profit margins. The company also noted that the weaker yen increased the cost of denominated fuel purchases abroad, further inflating expenses.
Background on JAL’s Financial Outlook
For the full fiscal year ending March 2027, JAL kept its profit forecast at 110 billion yen, down 20.1 percent from the previous year’s projection. Revenue was expected to hit 2.1 trillion yen, a 4.1 percent increase from the 2015‑year baseline. The firm’s guidance reflects a cautious stance, acknowledging both the potential upside in passenger demand and the continued pressure on costs.
JAL’s decline in operating profit was partly attributed to the firm’s “conservative domestic passenger growth
