Air Canada Targets Significant Revenue Growth

Air Canada (TSX:AC) announced on Tuesday its aim for a 36% increase in operating revenue by 2028, driven by strong demand for leisure travel on both domestic and international routes.

Global Airline Optimism

Worldwide, airlines are optimistic about air travel's future, supported by a post-pandemic surge as consumers prioritize experiences over goods.

2025 Earnings Projection

The airline also projected 2025 adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) between C$3.4 billion ($2.38 billion) and C$3.8 billion, which is slightly below analysts' average estimate of C$3.63 billion based on LSEG data.

CEO Michael Rousseau stated, "Our strategy, which builds on the unique strengths developed over the last decade, is to rise even higher with consistent margin expansion and structural cash generation while maintaining a strong balance sheet and responsible risk profile."

Network Expansion Plans

Air Canada intends to expand its network, including increasing flights to China and adding capacity to other Asia-Pacific routes.

The Canadian flag carrier is targeting C$30 billion in operating revenue by 2028, with an adjusted core profit margin aiming for 17% or higher. The airline anticipates reporting around C$22 billion in revenue this year, with a core profit margin of about 16%.

Rousseau added, "We believe we are very well positioned to execute our long-term plans."

Air Canada is expected to unveil more details about its future strategies during its investor day scheduled for Tuesday.

($1 = 1.4277 Canadian dollars)