Air France KLM SA (AFLYY)
OTHER OTC:AFLYY
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Air France KLM
(OTC:AFLYY)
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Rating:60Neutral
Price Target:
$1.50
▲(27.12% Upside)
Action:Reiterated
Date:05/09/26
The score is supported by improving profitability and strong operating cash flow, reinforced by a generally positive earnings call with disciplined guidance. This is offset primarily by significant balance-sheet risk (negative equity and high debt) and weak valuation signals (negative P/E), while technicals are only moderately supportive due to longer-term trend weakness.
Positive Factors
Improved operating profitability
Sustained operating improvement signals stronger cost control and pricing power across the network. A 6.1% operating margin and a EUR 2.0bn operating result indicate the business can generate sector-leading operating returns when demand normalizes, underpinning durable margin recovery and reinvestment capacity.
Negative Factors
Weak balance sheet: negative equity
Negative equity combined with large absolute debt levels constrains financial flexibility and increases vulnerability to shocks. Even with improvements since 2021, a structurally impaired capital base limits the company's ability to absorb cyclical downturns, pursue opportunistic investments, or rapidly deleverage without operational strain.
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Positive Factors
Negative Factors
Improved operating profitability
Sustained operating improvement signals stronger cost control and pricing power across the network. A 6.1% operating margin and a EUR 2.0bn operating result indicate the business can generate sector-leading operating returns when demand normalizes, underpinning durable margin recovery and reinvestment capacity.
Read all positive factors
Air France KLM (AFLYY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.08B
Dividend YieldN/A
Average Volume (3M)22.00K
Price to Earnings (P/E)―
Beta (1Y)0.98
Revenue Growth12.36%
EPS Growth239.75%
CountryUS
Employees78,399
SectorIndustrials
Sector Strength72
IndustryAirlines, Airports & Air Services
Share Statistics
EPS (TTM)0.27
Shares Outstanding2,627,698,700
10 Day Avg. Volume10,666
30 Day Avg. Volume22,001
Financial Highlights & Ratios
PEG Ratio-0.48
Price to Book (P/B)-29.80
Price to Sales (P/S)0.92
P/FCF Ratio265.06
Enterprise Value/Market Cap4.63
Enterprise Value/Revenue0.43
Enterprise Value/Gross Profit2.72
Enterprise Value/Ebitda2.43
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)0.31
Revenue Forecast (FY)$41.26B
Air France KLM Business Overview & Revenue Model
Company Description
Air France-KLM SA, together with its subsidiaries, provides passenger and cargo transportation services on scheduled flights in Metropolitan France, Benelux, rest of Europe, and internationally. The company operates through Network, Maintenance, T...
How the Company Makes Money
Air France-KLM primarily makes money by selling air transportation and related services across several business lines. (1) Passenger airline revenue: The largest revenue stream comes from transporting passengers on scheduled flights operated by Ai...
Air France KLM Earnings Call Summary
Earnings Call Date:Feb 19, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Jul 30, 2026
Earnings Call Sentiment Positive
The call conveyed a primarily positive operating and financial story: record group revenue (EUR 33bn), highest-ever operating result (EUR 2.0bn), strong cash conversion (EUR 1.0bn recurring adjusted FCF), improving unit costs, and meaningful premiumization and sustainability progress. Notable challenges were highlighted—Transavia transition losses, cargo volatility, higher Schiphol-related costs hitting KLM, near-term net debt upticks driven by lease and one-off items, and weather disruption early in 2026. Management presented a clear plan to continue transformation, control costs and pursue an >8% margin target by 2028, while acknowledging execution and external risks. On balance, the strong record results, cash position and strategic progress outweigh the operational and regional headwinds discussed.Positive Updates
Record Group Revenue and Passenger Traffic
Group revenues reached EUR 33.0 billion, up 4.9% year-on-year, an all-time high. The group carried nearly 103 million passengers, up 5% YoY and the first time above 100 million since COVID.
Negative Updates
Transavia Profitability Pressure
Transavia results declined by EUR 52 million (split roughly 50/50 between Transavia NL and Transavia FR). Issues included transition costs from 737 to A320 (upgauging), Orly slot transfers requiring route maturation, a unit size decrease and weaker leisure demand during hot summer months. Q4 saw unit revenue declines (Transavia unit revenue -6% in Q4 while capacity grew).
Read all updates
Q4-2025 Updates
Positive
Negative
Record Group Revenue and Passenger Traffic
Group revenues reached EUR 33.0 billion, up 4.9% year-on-year, an all-time high. The group carried nearly 103 million passengers, up 5% YoY and the first time above 100 million since COVID.
Read all positive updates
Company Guidance
The group’s forward guidance emphasized disciplined growth and cost control: capacity is expected to rise 3–5% in 2026 (long‑haul +4%, short/medium haul broadly flat, Transavia +10%), unit cost guidance is 0.0%–2.0% (execution‑dependent), net CapEx around EUR 3.0bn, and the jet fuel bill ~EUR 6.9bn (2025 ≈ 2026) with ~62% of 2026 fuel volume hedged and total hedges covering ~90% of one‑year consumption as tenor extends to 8 quarters; leverage target remains net debt/EBITDA 1.5–2.0 (currently 1.7), cash on hand ~EUR 9.4bn, recurring adjusted operating free cash flow already ~EUR 1.0bn in 2025, and the group reiterates its ambition to exceed an 8% operating margin by 2028 (2025 margin 6.1%) while delivering a “significant positive” adjusted operating free cash flow for 2026; early Q1 signals included January network NTR -0.4% (but +1.1% ex‑snow) and an operational weather cost of ~EUR 90m.Air France KLM Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
28
Negative
Cash Flow
54
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 33.35B | 31.70B | 31.46B | 30.02B | 26.39B | 14.31B |
| Gross Profit | 5.23B | 3.79B | 6.03B | 6.17B | 7.97B | 3.10B |
| EBITDA | 5.86B | 5.07B | 2.98B | 4.64B | 3.73B | -371.00M |
| Net Income | 1.57B | 1.53B | 317.00M | 934.00M | 728.00M | -3.27B |
Balance Sheet | ||||||
| Total Assets | 42.93B | 39.43B | 36.16B | 34.49B | 32.30B | 30.68B |
| Cash, Cash Equivalents and Short-Term Investments | 5.93B | 6.04B | 5.98B | 7.38B | 7.23B | 6.80B |
| Total Debt | 17.48B | 22.16B | 14.53B | 13.53B | 14.71B | 16.24B |
| Total Liabilities | 41.09B | 38.35B | 35.36B | 33.99B | 34.78B | 34.50B |
| Stockholders Equity | -254.26M | -982.58M | -1.76B | -2.05B | -3.00B | -3.82B |
Cash Flow | ||||||
| Free Cash Flow | 350.66M | 110.46M | -232.00M | -426.00M | 1.88B | -668.00M |
| Operating Cash Flow | 4.56B | 4.38B | 3.50B | 3.13B | 4.86B | 1.53B |
| Investing Cash Flow | -2.98B | -2.91B | -2.77B | -3.24B | -2.15B | -1.24B |
| Financing Cash Flow | -215.66M | -1.55B | -2.11B | -285.00M | -2.76B | -77.00M |
Air France KLM Technical Analysis
Positive
1.18
Price Trends
1.12
Positive
1.23
Negative
1.30
Negative
Market Momentum
0.01
Negative
55.07
Neutral
66.17
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AFLYY, the sentiment is Positive. The current price of 1.18 is above the 20-day moving average (MA) of 1.14, above the 50-day MA of 1.12, and below the 200-day MA of 1.30, indicating a neutral trend. The MACD of 0.01 indicates Negative momentum. The RSI at 55.07 is Neutral, neither overbought nor oversold. The STOCH value of 66.17 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AFLYY.
Air France KLM Peers Comparison
UnderperformOutperform
Sector (63)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $49.70B | -37.50 | 23.14% | 0.96% | 5.24% | 20.93% | |
72 Outperform | $32.34B | 10.76 | 24.91% | ― | 4.73% | 1.55% | |
68 Neutral | $28.37B | 12.06 | 24.66% | 1.37% | 19.66% | 49.49% | |
64 Neutral | $14.39B | 6.16 | 126.90% | 3.50% | 16.19% | 62.18% | |
63 Neutral | $10.79B | 15.43 | 7.44% | 2.01% | 2.89% | -14.66% | |
60 Neutral | $3.08B | -20.44 | -178.28% | ― | 12.36% | 239.75% | |
54 Neutral | $19.93B | 20.61 | 10.67% | 1.73% | 4.72% | 72.71% |
* Industrials Sector Average
AFLYY
Air France KLM
1.19
0.23
23.47%
DAL
Delta Air Lines
76.14
28.79
60.79%
RYAAY
Ryanair Holdings
59.62
4.21
7.60%
LUV
Southwest Airlines
40.86
10.52
34.69%
UAL
United Airlines Holdings
99.96
25.31
33.90%
LTM
LATAM Airlines Group SA Sponsored ADR
49.89
12.80
34.51%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.