British Airways and Iberia lead for IAG as airline group posts record profits

International Airlines Group (IAG) has posted record profits for 2025, with British Airways and Iberia as its standout performers.

On February 27, 2026, IAG announced that operating profits had risen by 17.3% from $4.9 billion (€4.2 billion) in 2024 to $5.9 billion (€5 billion) in 2025, whereas revenues grew by 3.5% to $38.9 billion (€33 billion) from $37.7 billion (€32 billion) in 2024.

IAG explained that the biggest drivers behind the increase in operating profit were Iberia and British Airways, thanks to a “strong performance in their core markets and the benefits of lower fuel prices and favorable foreign exchange”.

Iberia delivered a 16.2% margin and saw its profits rise by $337 million (€286 million), while British Airways delivered a 15.2% margin with its profits increasing by $245 million (£182 million).

IAG’s overall margins, including its other carriers LEVEL, Aer Lingus and Vueling, were 15.2%, which the group described as “significantly better than those of our global competitors”.

Miquel Ros / AeroTime“We reported another year of exceptional performance in 2025, delivering for our customers with continued improvements in ontime performance and customer satisfaction,” said Luis Gallego, IAG CEO. “This sector-leading operational performance is translating into world-class financial results, with outstanding margins and superior return on capital.”

He added: “We are confident as we look to the future, with compelling market dynamics, long-term secular growth and a clear plan to leverage our business model and deliver our strategy.”

According to IAG, its performance highlighted the “strength of demand for travel, a long-term secular trend, as well as the attractive nature of IAG’s core markets, brands and customers”.

The results showed that, during 2025, British Airways’ capacity was broadly flat in the North Atlantic market, due to lower aircraft availability offsetting growth.

However, IAG said that “trading throughout the year was robust,” particularly in its premium cabins, “offsetting some third quarter softness in the US point-of-sale economy leisure segment”.

“In the North Atlantic, IAG is driving returns and margins principally through the rebuilding of British Airways’ premium capacity to pre-COVID levels,” said an IAG spokesperson.

In reference to Iberia and Aer Lingus’s new A321XLR aircraft, which began arriving in 2025, IAG declared that they were already “exceeding expectations from both a customer and financial standpoint”.

“Both Aer Lingus and Iberia started to deploy their new A321XLR aircraft, profitably delivering growth from greater frequency, year-round services and targeting secondary destinations,” said the IAG spokesperson. “Competitor growth into both Spain and Ireland from North America has been significant, so the ability to deploy these efficient aircraft is strategically important.”

Additionally, AIG noted that its “two most important non-financial metrics”, On Time Performance (OTP) and Customer NPS, both improved in 2025.

Commenting on AIG’s proposal to bring TAP Air Portugal into the airline group, the company said that it believes it is a “strategically interesting opportunity,” but “will have to be on terms that create value for shareholders”.

SvedOliver / ShutterstockFinally, IAG claimed that the group was “positively positioned for 2026” and that the “outlook for travel trends continues to be supportive, particularly in our core markets”.

“We will continue to execute on our strategy, supported by our transformation program,” IAG said. “This will enable the continuing delivery of earnings growth at world-class margins, as well as significant free cash flow, which will help to strengthen the balance sheet as we build towards a step up in capital expenditure.”

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