China Southern Airlines Co Ltd Class A

The 2026 Fortune Global 500 list shows that aerospace manufacturers generally posted higher profits than airlines. GE Aerospace topped all aviation companies on the list with a net profit of 8.704 billion US dollars, earning over 3 billion dollars more than the world’s most profitable airline, Emirates Group. Airbus recorded a net profit of 5.889 billion dollars, up 28.7 percent year on year. Boeing returned to profitability with a net profit of 2.235 billion dollars, and its revenue surpassed that of Airbus. Honeywell posted a net profit of 4.729 billion dollars. Supply chain strains have led to a shortage of aircraft and components, driving up manufacturers’ profits, while airlines have been weighed down by delivery delays and rising costs. Emirates Group reported a net profit of 5.354 billion dollars. Delta Air Lines had the highest revenue among global carriers and ranked second in net profit. China’s three state-owned major airlines remained absent from the Global 500. Two of them were still loss-making in 2025, and their combined losses in the first half of 2026 are expected to approach 10 billion yuan. Xiamen C&D Group ranked 112th with revenue of 97.028 billion dollars, but it swung from profit to loss in 2025, posting a loss of 509 million dollars.

Airports Council International World has released its 2026 World Airport Traffic Dataset, showing that global air passenger numbers reached 9.8 billion in 2025, up 3.7 percent year on year. Chinese airports performed strongly, with Shanghai Pudong International Airport jumping from tenth to fifth place, Guangzhou Baiyun International Airport returning to ninth, Beijing Capital International Airport rising one spot to fifteenth, and Shenzhen Bao'an International Airport climbing from twenty-second to nineteenth. In cargo, global air freight volume exceeded 131 million tonnes in 2025, up 3.3 percent year on year. China accounted for five of the top twenty airports, with Hong Kong International Airport leading at 5.1 million tonnes and Shanghai Pudong International Airport second at 4.1 million tonnes. Meanwhile, the International Air Transport Association has sharply lowered its 2026 global airline profit forecast. Due to the blockage of the Strait of Hormuz amid Middle East conflict and average jet fuel prices rising to 152 dollars per barrel, the industry-wide net profit estimate has been slashed from 45 billion dollars to 23 billion dollars, with the net profit margin falling to 2.0 percent. Air China, China Southern Airlines, and China Eastern Airlines together posted a combined net loss approaching 10 billion yuan in the first half, with the second-quarter loss reaching 12.201 billion to 13.801 billion yuan, compared with a combined first-quarter profit of 4.828 billion yuan.

China's three largest airlines—Air China, China Eastern Airlines, and China Southern Airlines—face a combined net loss of up to 9 billion yuan for the first half of 2026, confronting a tougher outlook. With demand remaining weak, doubts are growing over whether the summer travel season can absorb soaring fuel costs. HSBC analysts forecast the trio will post a combined loss of about 16.8 billion yuan for the full year. In contrast, current market estimates expect a combined profit of 1.3 billion yuan, highlighting a sharp divergence in views. Chinese carriers engage in very little jet fuel hedging, leaving them highly exposed to rising crude oil prices.

China Southern Airlines announced that in June, the group's passenger capacity, measured by available seat kilometers, fell 1.18% year-on-year. Over the same period, passenger traffic, measured by revenue passenger kilometers, decreased 2.48% year-on-year, with a load factor of 84.03%, down 1.13 percentage points year-on-year.

Shares of Air China, China Eastern Airlines, and China Southern Airlines have each fallen at least 42% so far in 2026, while Cathay Pacific Airways has risen nearly 6%, leaving the three mainland carriers trailing the Hong Kong-based airline by almost 50 percentage points. Morgan Stanley lowered its net profit forecasts for the three major Chinese airlines by an average of 12% last week, citing soft domestic demand. HSBC noted that elevated fuel prices and limited pricing power are pressuring margins, and maintained its buy recommendation on Cathay Pacific as short- and long-haul bookings improved. Investors now await Cathay's first-half earnings in early August and results from the mainland carriers later next month for signs of whether the performance gap will persist.

China Southern Airlines expects a net loss attributable to shareholders of 3.473 billion to 3.973 billion yuan for the first half of 2026, a significant widening from the 1.533 billion yuan loss in the same period last year. The net loss attributable to shareholders after deducting non-recurring items is expected to be between 4.48 billion and 4.98 billion yuan. The company said that from March, the international geopolitical situation led to sharp fluctuations in aviation kerosene prices, causing a year-on-year surge in fuel costs. Despite measures such as dynamically optimising capacity and lean cost control, it still incurred losses due to objective factors. In the first quarter of 2026, the company achieved revenue of 47.782 billion yuan and a net profit attributable to shareholders of 1.481 billion yuan.

China Southern Airlines disclosed its earnings forecast, expecting a net loss attributable to shareholders of the listed company of 3.473 billion to 3.973 billion yuan for the first half of 2026, compared with a loss of 1.533 billion yuan in the same period last year. In the first quarter, the company seized opportunities from the Spring Festival travel rush and market recovery, continuously optimizing its route network structure and passenger and cargo layout, resulting in a significant year-on-year improvement in overall performance. After entering March, affected by the international geopolitical situation, aviation kerosene prices fluctuated violently, putting enormous pressure on the entire industry, and the company's jet fuel costs surged year-on-year in the first half.