Airports and cargo companies are faring better.

As of today, all A-share listed airlines have disclosed their 2025 semi-annual reports. Private listed airlines have all achieved profitability, while the three major state-owned airlines still haven't managed to turn losses around.

Upon reviewing the financial reports of various airlines, four private listed carriers—Spring Airlines Co.,Ltd. (601021.SH), Juneyao Airlines Co.,Ltd. (603885.SH), Hainan Airlines (601221.SH), and China Express Airlines Co.,Ltd. (002928.SZ)—all posted profits in the first half. Among them, the low-cost carrier Spring Airlines Co.,Ltd. achieved the highest net profit of 11.69 billion yuan, making it the most profitable listed airline in mainland China for the first half.

**Passenger Airlines Show Mixed Performance**

In fact, Spring Airlines Co.,Ltd. has been the most profitable airline in mainland China for two consecutive years in 2023 and 2024, with net profits of 22.57 billion yuan in 2023 and 22.73 billion yuan in 2024, setting new records since the company's launch for two straight years.

In contrast, the three major state-owned airlines—Air China Limited (601111.SH), China Eastern Airlines Corporation Limited (600115.SH), and China Southern Airlines Company Limited (600029.SH)—remain unprofitable, posting losses of 18.06 billion yuan, 14.41 billion yuan, and 15.33 billion yuan respectively in the first half.

The performance gap between airlines is related to the slower-than-expected recovery of international routes and continued intense competition in the domestic market. In the first half of this year, international passenger flights increased 24.9% compared to 2024, but remained 12% below 2019 levels, indicating that international flight volumes have not fully recovered to pre-pandemic levels.

Among domestic airlines, the three major carriers have the largest proportion of international routes and are therefore more significantly affected by the slow international market recovery. In comparison, private airlines like Spring Airlines Co.,Ltd. and Juneyao Airlines Co.,Ltd., whose international routes mainly focus on neighboring countries and regions such as Japan and South Korea, face relatively smaller impacts. Moreover, Spring Airlines Co.,Ltd., which operates no wide-body aircraft, has more flexibility and speed in adjusting capacity to more advantageous routes.

Spring Airlines Co.,Ltd. mentioned in its semi-annual report that Japanese routes have long been one of the important pillars of profitability in the company's international market. The company's capacity deployment on Japanese routes increased by over 116.8% year-on-year in the first half and grew 77.7% compared to the same period in 2019. The improvement in international network structure has positively impacted revenue performance.

For airlines unable to fully restore European and American intercontinental routes, wide-body aircraft originally intended for international long-haul routes are being redeployed to the domestic market, intensifying competition and affecting domestic ticket price levels.

Based on semi-annual reports from several listed airlines, passenger revenue per kilometer data, which represents ticket price levels, all declined year-on-year. The three major airlines' domestic route revenues also fell compared to the previous year. Even Spring Airlines Co.,Ltd., with its low-price advantage, saw domestic route passenger revenue per kilometer decrease 4.8% year-on-year.

With declining revenues, cost control capabilities have become key to maintaining performance. In this regard, private airlines represented by Spring Airlines Co.,Ltd. have more advantages compared to state-owned carriers.

**Airports and Cargo Companies Fare Better**

In comparison, listed airport companies, whose main business revenue depends on aircraft landing fees and other charges, have performed better.

According to statistics, among seven listed airport companies in the first half, five achieved profitability. Only Hong Kong-listed Meilan Airport and Capital Airport remained in losses, with Capital Airport having posted consecutive losses for five years since 2020, with cumulative losses exceeding 100 billion yuan.

This is closely related to the opening of Beijing Daxing Airport in 2019. As both are positioned as international hub airports, Beijing Daxing Airport's diversion effect on Capital Airport was immediate. Before 2019, Capital Airport's passenger throughput consistently ranked first nationwide, but in the second year after Daxing Airport's operation, combined with pandemic impacts, Capital Airport's passenger throughput began to plummet. By 2023, post-pandemic, passenger throughput remained half of what it was in 2019.

Currently, Capital Airport has been surpassed by Shanghai and Guangzhou in passenger throughput rankings. In the first half of this year, Shanghai Airport and Guangzhou Baiyun Airport both achieved profitability, with net profits ranking in the top two among listed airport companies, growing 28.14% and 71.32% year-on-year respectively. Shenzhen Airport posted the highest net profit growth at 79.13% year-on-year.

Cargo logistics listed companies also enjoyed profit growth. In the first half of this year, Air China Cargo Co.,Ltd. (001391.SZ) and Eastern Air Logistics Co.,Ltd. (601156.SH) earned 12.4 billion and 12.89 billion yuan respectively, with year-on-year growth of 86.15% and 0.9% respectively. Additionally, China Southern Airlines' logistics subsidiary posted a net profit of 16.01 billion yuan in the first half, becoming an important contributor to China Southern Airlines' performance.

Currently, global air cargo demand continues to show overall growth. According to International Air Transport Association (IATA) statistics, global cargo tonne-kilometers (CTK) increased 2.8% year-on-year in the first half, with Asia-Pacific region cargo demand showing significant growth of 8.4% year-on-year. In terms of air export, China's total air export cargo volume reached 2.67 million tonnes in the first half, up 11.6% year-on-year. China's international route cargo and mail transport volume and cargo turnover reached 2.037 million tonnes and 15.16 billion tonne-kilometers respectively, hitting new highs in nearly a decade, with year-on-year increases of 23.4% and 20.9% respectively. These trends benefit cargo logistics companies operating all-cargo aircraft on intercontinental cargo routes.

However, frequent adjustments to U.S. tariff policies and the cancellation of small package exemption policies in the first half also affected air carriers. Based on first-half export cargo growth rates, Chinese exports to Europe, Asia-Pacific, and other markets showed positive growth at 15.4%, 12.2%, and 22.2% respectively, while exports to North America declined 8.2%. This trend may continue into the second half.

Recently, IATA revised its 2025 full-year cargo and mail transport volume outlook downward from 72.5 million tonnes predicted at the end of 2024 to 69 million tonnes, reducing the growth rate from the previous 5.8% to 0.6%.