Air Canada has reported a net loss of CA$102 million for the first quarter of 2025, as cost pressures and a slight decline in revenue weighed on the airline’s performance. The airline’s operating revenue came in at CA$5.196 billion, a modest decrease of CA$30 million or 1% compared to the same quarter in 2024, largely in line with a 0.4% reduction in operated capacity.
Operating expenses rose by CA$89 million, or 2%, to CA$5.304 billion. The increase was primarily attributed to higher depreciation, rising costs in ground packages, and the impact of unfavourable foreign exchange fluctuations. These upward cost pressures outweighed the benefits of lower year-over-year fuel prices. As a result, the airline posted an operating loss of CA$108 million, a sharp reversal from the CA$11 million operating income recorded in Q1 2024.
Adjusted EBITDA stood at CA$387 million, with a 7.4% margin — both figures down from the previous year. Adjusted pre-tax loss widened to CA$215 million, compared with CA$94 million in the same period last year, while the adjusted net loss reached CA$150 million, up from CA$96 million. Loss per diluted share, on an adjusted basis, increased to CA$0.45 from CA$0.27.
The carrier also faced rising unit costs, with adjusted CASM increasing by 3.5% to 15.27 cents. Meanwhile, net cash flow from operating activities dropped by CA$66 million to CA$1.526 billion, and free cash flow fell more significantly, down CA$225 million to CA$831 million.
Looking ahead, Air Canada intends to grow available seat miles (ASM) capacity by 2% to 2.5% in the second quarter of 2025 compared to the same period in 2024. The airline has also updated its full-year guidance to reflect shifts in the commercial landscape and expectations around fuel prices.
