It saw growth and sustained its profitability against the backdrop of a challenging aviation market.
In its report, flag carrier Philippine Airlines (PAL) reported “solid results” in the first quarter of 2026.
Net income has risen 2.6% year-on-year to USD78.55 million and total revenues increasing 9.7% to USD895.70 million.
According to the company, its performance was driven by “sustained passenger demand, stronger cargo yields, and continued growth in ancillary revenues.”
Passenger revenues grew 8.7% to US$759.65 million as PAL carried 4.30 million passengers, up 6.1% year-on-year.
“Growth was supported by post-holiday travel demand and a resilient network. Capacity expanded in line with demand, with available seat kilometers (ASKs) increasing 7.2% and flights mounted rising 8.4%,” noted the airline.
Revenues of the cargo division increased 22.5% to US$43.21 million, reflecting improved yields amid tight global airfreight capacity, particularly in lanes affected by Middle East disruptions.
Ancillary revenues rose 11.2% to US$83.56 million, driven by higher uptake of value-added and personalized travel services.
Overall, PAL generated a healthy operating profit of US$101.85 million, as revenue gains outpaced the increase in operating expenses.
Total operating expenses saw 7.1% uptick to US$793.85 million.
Flying operations—the airline’s largest cost component—increased 9.2% to US$447.08 million, reflecting higher flight activity, late-quarter fuel price pressures linked to developments in the Middle East, and increased depreciation and amortization from fleet expansion.
“Sustained net profitability generated strong operating cash flow during the quarter, allowing PAL to fund capital expenditures, service debt, and strengthen its cash position, while maintaining the liquidity needed to manage near‑term disruptions and support investments in fleet and passenger experience,” further noted the flag carrier.
It also stated that it remains focused on maintaining financial discipline and operational resilience as volatility continues to shape the global aviation environment.
For his part, Philippine Airlines President Richard Nuttall said, “Our first quarter results reflect both the strength of demand for Philippine travel and the disciplined execution of our team.”
He, however, underscored that the financial results only “partially reflect” the impact of the escalation in the Middle East, which started in February and had its effect ripple the entire March—specifically introducing volatility in fuel prices and disrupted parts of the global aviation network, as per the executive.
“We are actively managing our network and costs to protect margins and liquidity. While near-term headwinds remain, we are confident in the strength of our fundamentals and are taking prudent steps to sustain our momentum,” he added.
