Air Canada has announced its financial results for the first quarter of 2026, highlighting record operating revenues driven by strong demand across its network. The airline reported operating revenues of $5.8 billion for the quarter, a significant increase of more than 11 percent compared to the same period in 2025.
Key Financial Highlights
The company achieved operating income of $117 million, representing a positive swing of $225 million from the previous year. Adjusted EBITDA reached a record $623 million, up 61 percent year-over-year. Air Canada generated $1.8 billion in net cash flows from operating activities and $1.6 billion in free cash flow during the quarter.
Share Repurchase and Capital Allocation
During the first quarter, Air Canada repurchased more than $140 million of its shares. The company continues to maintain a strong financial footing while delivering long-term shareholder value through prudent capital allocation and balance sheet management.
Guidance Update
Given the volatility and uncertainty related to jet fuel prices for the second half of 2026, Air Canada has suspended its full-year 2026 financial guidance. However, the company introduced second quarter 2026 financial guidance to provide near-term visibility. The guidance reflects expectations to offset between 50 percent and 60 percent of the estimated incremental fuel expense through various commercial and cost actions.
CEO Statement
Michael Rousseau, President and Chief Executive Officer of Air Canada, stated: "In the first quarter, Air Canada built on the momentum of our best-ever fourth quarter to launch strongly into 2026. We reported record operating revenues of $5.8 billion, up more than 11 per cent from the same period in 2025. Our operating income of $117 million was a positive $225 million swing from a year ago, and we generated record adjusted EBITDA of $623 million, up 61%. These results show the efficacy of our strategy and the dedication of our employees."
Mr. Rousseau added: "We are committed to maintaining a strong financial footing while delivering long-term shareholder value. During the quarter, we generated $1.8 billion in cash from operating activities, $1.6 billion in free cash flow and repurchased more than $140 million of our shares. This performance reflects our prudent approach to capital allocation and balance sheet management."
Demand Outlook
The company continues to see strong demand across the network and throughout the booking window for the latter half of the year. Air Canada believes it is very well positioned from a financial, fleet, and network perspective, as evidenced by two consecutive record quarters.
Non-GAAP Measures
Adjusted CASM, adjusted EBITDA, adjusted EBITDA margin, leverage ratio, net debt, adjusted pre-tax income (loss), adjusted net income (loss), adjusted earnings per share, and free cash flow are non-GAAP financial measures. These measures do not have standardized meanings and may not be comparable to similar measures presented by other entities. The leverage ratio was 1.3 at March 31, 2025. Adjusted EBITDA and operating income for the trailing 12-month periods ended March 31, 2026 were $3.360 billion and $1.143 billion, respectively.
