Abstract

LATAM Airlines Group SA will report quarterly results on February 03, 2026 Post Market; this preview summarizes consensus forecasts for revenue, EBIT, margins, and EPS, reviews last quarter’s outcomes, and distills the majority institutional stance along with the key operating levers in passenger and cargo dynamics.

Market Forecast

For the current quarter, the company’s forecast data indicate revenue of $3.90 billion, up 17.71% year over year, EBIT of $0.65 billion with an implied 36.15% year-over-year increase, and estimated EPS of $1.26, implying an 80.17% year-over-year increase. Forecast commentary implies focus on margins, but explicit gross profit margin and net profit margin guidance are not provided; adjusted EPS is guided via forecast EPS of $1.26. The main business is passenger transportation, which remains the primary driver, while cargo provides a smaller but complementary contribution and demand indicator for regional trade lanes. The most promising segment remains passenger services, supported by network optimization and yield management, with passenger revenue previously at $3.39 billion and strong year-over-year growth implied by forecast revenue expansion.

Last Quarter Review

In the previous quarter, LATAM Airlines Group SA delivered revenue of $3.80 billion, a gross profit margin of 31.00%, GAAP net profit attributable to the parent of $0.38 billion with a net profit margin of 9.97%, and adjusted EPS was not disclosed in the actuals dataset; EPS was modeled but not reported as an actual value in the feed. Quarter-on-quarter, net profit expanded by 56.82%, reflecting stronger operating leverage and seasonality. By business line, passenger revenue was $3.39 billion and cargo revenue was $0.40 billion, with passenger operations accounting for 89.35% of total revenue; this mix underscores the company’s demand-led recovery and pricing power in core markets.

Current Quarter Outlook (with major analytical insights)

Passenger Operations

Passenger services are the company’s central earnings engine this quarter, with the revenue mix previously at 89.35% and forward estimates indicating continued expansion to $3.90 billion at the consolidated level. Capacity discipline and route optimization across Brazil, Chile, Peru, and international long-haul should underpin yields, while continued recovery in corporate travel is likely to support premium cabin mix. If unit revenue trends hold and fuel prices remain within recent bands, the company can sustain attractive operating spreads, translating forecast EBIT of $0.65 billion into improved per-share earnings at an estimated $1.26.

Passenger demand has benefited from a combination of stable Latin American GDP prints and resilient leisure flows, including trans-Atlantic and intra-regional connectivity, which have been key to load factor stability. The company’s network adjustments—tilting capacity toward more profitable corridors while pruning underperforming routes—are designed to protect margin in shoulder periods. An additional positive lever is ancillary monetization: baggage, seat selection, and loyalty partnerships can provide a buffer to unit cost inflation while diversifying revenue composition.

Execution risks in passenger operations include FX volatility against the U.S. dollar and competitive responses from regional carriers on overlapping routes. Promotional fare activity can pressure yields if macro sentiment softens, but historical cost actions and fleet efficiencies provide counterweights. Monitoring load factors and RASK-CASK spreads through the quarter will be essential to gauge whether the forecast EBIT uplift of 36.15% YoY is tracking.

Cargo Operations

Cargo remains an important stabilizer, contributing $0.40 billion last quarter, and acting as a hedge against passenger seasonality by leveraging widebody belly capacity and dedicated freighters. Regional export lanes, particularly perishables from the Andean region and Brazil, typically sustain baseline volumes even amid demand fluctuations in manufactured goods. The forecast mix suggests cargo will retain a supportive, albeit smaller, role in consolidated margin delivery.

Freight yields have normalized from pandemic-era peaks, but disciplined capacity allocation and contract recalibration with key shippers can protect contribution margins. The company’s integration of cargo scheduling with passenger belly space utilization remains a structural advantage in the region, improving asset turns and reducing marginal cost per ton-kilometer. If airfreight rates stabilize and fuel surcharges remain aligned with market benchmarks, cargo can contribute incremental EBIT resilience even as passenger operations drive headline growth.

Risks to the cargo outlook include rate volatility on long-haul lanes and shifts in outbound agricultural volumes due to seasonality or weather. However, the diversified commodity base and network breadth typically help smooth these pressures. A steady cargo contribution can support the projected EPS uplift, especially if passenger fundamentals are temporarily choppy.

Costs, Margins, and Financial Leverage

Cost discipline is central to sustaining the last quarter’s gross margin of 31.00% and net margin of 9.97%. The forecast EBIT of $0.65 billion against projected revenue of $3.90 billion implies an EBIT margin in the mid-teens, contingent on fuel costs, labor, and maintenance inputs trending within plan. The quarter-on-quarter net profit improvement of 56.82% last quarter highlights operating leverage that should persist if capacity additions are matched to demand and if ancillary revenue per passenger continues to rise.

Jet fuel and FX are the two swing factors that can drive variance from the EPS estimate of $1.26. Hedging policies, fleet modernization, and utilization gains can mitigate fuel volatility, while a natural revenue hedge exists through U.S. dollar-linked demand components and diversified geographic exposure. On the balance sheet, steady EBIT growth supports deleveraging capacity and investment in network and product quality, which in turn can help preserve pricing power.

If macro conditions soften, management’s ability to rebalance capacity and push additional ancillary initiatives will be critical to defending margins. The interplay between RASK improvements and CASK management will determine whether profitability meets or exceeds the guided year-over-year growth trajectory embedded in the forecasts.

Network Strategy and Commercial Initiatives

The company’s strategy centers on calibrating capacity to profitable corridors and optimizing connections across hubs to enhance load factors and yields. Aligning schedule banks to minimize connection times and improve on-time performance can elevate customer satisfaction and loyalty conversion, which flows through to both passenger yields and ancillary revenue. Loyalty partnerships and co-branded card economics can also deliver non-ticket revenue that is less cyclical than base fares.

Commercial initiatives around fare family simplification and dynamic pricing can unlock revenue per seat, especially where competitive intensity is rational. A tighter focus on premium leisure and corporate recovery in select markets can support a stronger cabin mix, reinforcing the EBIT guidance trend. These levers, coordinated with revenue management systems, underpin the case for an 80.17% year-over-year EPS increase in the forecast.

Operational Reliability and Execution

Operational performance—on-time departures, completion factors, and customer handling—will shape near-term revenue quality and cost outcomes. Reduced disruption lowers compensation costs and irregular operations expenses, helping preserve the 31.00% gross margin base observed last quarter. Investments in maintenance planning and crew scheduling efficiency can compress controllable CASK, supporting EBIT conversion toward the $0.65 billion forecast.

Seasonal demand peaks around holidays and summer in the Southern Hemisphere require precise resource planning to avoid bottlenecks. Maintaining service consistency allows the company to grow premium share and capture more ancillary revenue opportunities. If execution remains tight, the company can absorb moderate macro or fuel noise without derailing the path to the estimated $1.26 EPS.

Analyst Opinions

Across recent institutional commentary, the dominant stance skews bullish, emphasizing the improving unit revenue environment, disciplined capacity growth, and continued EBIT recovery. Supportive views highlight the forecast revenue of $3.90 billion, the implied EBIT margin expansion from the $0.69 billion achieved last quarter to a projected $0.65 billion on seasonally different mix, and the EPS estimate of $1.26 as achievable if fuel and FX remain within expected ranges. Analysts point to passenger demand resilience and ancillary monetization as near-term drivers, with cargo providing portfolio balance.

Prominent buy-side and sell-side voices note that last quarter’s revenue and EBIT outperformance versus earlier estimates, alongside a 56.82% sequential increase in net profit, set a constructive baseline. The prevailing view is that management’s network and pricing actions can sustain mid-teens EBIT margins on the estimated $3.90 billion revenue. The minority of cautious opinions centers on fuel and competitive pricing risk, but these are seen as manageable given the company’s cost and network measures. Overall, bullish commentary outweighs bearish views, aligning with the quarter’s positive EPS trajectory and anticipated revenue growth of 17.71% year over year.