Singapore Airlines Profit Plunges on Air India Losses — Update

By Kimberley Kao

Singapore Airlines' profit dropped 82% in its second quarter, dragged by losses from associate Air India and lower interest income.

The city-state's flag carrier said Thursday that net profit for the three months ended September was 52.4 million Singapore dollars, equivalent to US$40.2 million, down sharply from S$290.3 million a year earlier.

The decline was partly due to Air India's losses, it said. Air India's results weren't part of the Singapore carrier's earnings last year.

Operating profit rose 22.5% to S$398 million due to healthy passenger demand and lower fuel prices, mitigating a rise in nonfuel unit costs resulting from inflationary pressures, the airline said.

Revenue rose 2.2% to S$4.88 billion, helped by a 5.1% increase in passenger traffic that offset weaker yields due to heightened competition.

"The airline industry continues to face challenges from geopolitical tensions, macroeconomic headwinds, inflationary cost pressures, and supply chain constraints," Singapore Airlines said.

Cargo load factor for the three-month period fell by 1.0 percentage point to 56.2%, a segment that still faces uncertainty due to changing trade policies and market dynamics, the air carrier said.

"While cargo volumes are growing on the back of the group's diversified network and verticals, yields remain under pressure as airlines redeploy cargo capacity" from the U.S. to other lanes, it said.

Singapore Airlines proposed a S$900 million capital return plan for shareholders, comprising a special dividend package of S$0.10 a share to be paid annually over three financial years.

The first tranche of this payment of S$0.03 a share will be paid in December, in addition to the interim dividend of S$0.05 declared.

Analysts widely expect Singapore Airlines' earnings to continue moderating in the quarters ahead due to easing passenger yields and the overhang from Air India. Momentum in cargo demand has also slowed amid tariff shifts and weather conditions.

"SIA's valuations have slightly outpaced its fundamentals at this juncture, given the downward earnings trajectory and uncertainty surrounding Air India," DBS Group Research analyst Jason Sum said in a note ahead of the earnings release.

Sentiment toward the Singapore carrier has been damped by Air India's "uncertain path to profitability, and the potential need for additional capital risks further [erodes] investor confidence," Sum wrote.

Shares in the airline have risen just 3.3% so far this year, compared with 21% gain in the benchmark Straits Times Index.

Write to Kimberley Kao at kimberley.kao@wsj.com

(END) Dow Jones Newswires

November 13, 2025 05:52 ET (10:52 GMT)