Air France-KLM: Strong quarter on multiple fronts. Trimming estimates for higher fuel. Remain OW

Research evidence excerpt

Air France-KLM: Strong quarter on multiple fronts. Trimming estimates for higher fuel. Remain OW

J P M O R G A N Europe Equity Research

31 July 2026

Air France-KLM Overweight

AIRF.PA, AF FP

Strong quarter on multiple fronts. Trimming estimates Price (30 Jul 26):€12.34

for higher fuel. Remain OW Price Target (Dec-27):€16.00

Air France-KLM reported a strong Q2 which beat consensus by c40% driven by European Transport & Logistics

ACsustained strong Network pricing and Cargo. We trim our 2026E EBIT estimate by Harry J Gowers

c-5% due to the spike in jet fuel over the last few weeks versus our previous forecasts. (44-20) 7134-7522

We now forecast 2026E EBIT at €1.82bn (previously €1.91bn) which is c8% above harry.gowers@jpmorgan.com

Bloomberg consensus. Our 2027E EBIT also decreases by -6% due to higher fuel J.P. Morgan Securities plc

costs. Our Dec-27 price target remains unchanged at €16 which implieis c30% upside Alexia Dogani

to last close. Our key takeaways from the results: (1) Q2 Network RASK saw (44-20) 3493-3791

alexia.dogani@jpmorgan.com

sustained elevated pricing; however July has started to see some normalisation mostly J.P. Morgan Securities plc

due to Asia. (2) Transavia saw better underlying earnings despite higher fuel, with

Bhavpreet S Batra

positive RASK growth in a competitive backdrop and lower unit costs versus the prior (91-22) 6157-5046

year. (3) Q2 ex-fuel unit costs were +1% which showed another solid quarter of cost bhavpreet.batra@jpmorgan.com

execution. This included a spike in maintenance costs due to supply chain issues, J.P. Morgan India Private Limited

although offset by better operational performance. Shikha Khurana

(91-22) 6157-5022

• (1) Strong Q2 pricing; July starting to see Asia normalisation. AF-KLM shikha.khurana@jpmchase.com