Air Canada Adjusts Full-Year Outlook Following Q2 Financial Results. Air Canada presented its financial results for the second quarter of 2026 and announced an update to its full-year guidance. Between April and June, the company recorded operating revenues of CAD 6,266 million and operating expenses of CAD 6,481 million, resulting in an operating loss of CAD 215 million and a negative operating margin of 3.4%. Adjusted EBITDA reached CAD 719 million, with an 11.5% margin.
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The airline also reported a pre-tax loss of CAD 316 million and a net loss of CAD 178 million, equivalent to CAD 0.63 per diluted share. On an adjusted basis, Air Canada achieved a net income of CAD 114 million and adjusted earnings per diluted share of CAD 0.40. Cash flow generated from operating activities reached CAD 651 million, while free cash flow stood at CAD 174 million. Long-term debt and lease liabilities totaled CAD 12,794 million, with a net leverage ratio of 1.7.
After suspending its forecast on April 30, Air Canada decided to reinstate its financial targets, albeit with a downward revision. The company now expects adjusted EBITDA of between CAD 2,900 million and CAD 3,200 million, compared to the previous range of CAD 3,350 million to CAD 3,750 million. It also lowered its capacity growth forecast, which will now settle between 2.25% and 3.25% compared to 2025. Adjusted CASM is projected to increase between 5% and 6%, while expected free cash flow is estimated between CAD 200 million and CAD 500 million.
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The update primarily responds to higher fuel costs and shifting macroeconomic conditions. Air Canada assumes an average exchange rate of CAD 1.41 per U.S. dollar and forecasts fuel prices of CAD 1.38 per liter during the third quarter and CAD 1.29 during the fourth. The company expects to offset part of the impact through yield adjustments and disciplined cost management. Air Canada also maintains non-binding agreements for up to CAD 2,000 million in aircraft sale-and-leaseback transactions, expecting to execute CAD 1,000 million during 2026.
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