Deutsche Lufthansa AG

Deutsche Lufthansa AG is the listed holding of a group that combines five passenger airlines with a cargo airline and an MRO business. It employed 103,255 people at the end of 2025 and carried 135 million passengers on 1.01 million flights ¹. The fleet totalled 737 aircraft at 31 December 2025, with an average age of 14.4 years; 219 aircraft are on firm order for delivery from 2026 to 2032, with 182 options, and about 45 are due in 2026 ³.

The group is also trimming its regional operations: in Q2 2026 it removed CityLine flights from the schedule ⁵. It is expanding in Italy: Lufthansa holds 41% of ITA Airways and has exercised its option to reach 90%, with closing expected in Q1 2027 ¹¹.

Revenue doubled in 2022 as traffic recovered and has grown each year since, reaching €39.6bn in 2025 ^{1 8}. Profitability has not followed. Adjusted EBIT peaked at €2.68bn in 2023 (7.6% margin), fell to €1.65bn in 2024 when strikes cost about €450m and Lufthansa Airlines' earnings dropped by €948m, then recovered to €1.96bn in 2025 ^{6 7 1}.

2026 has started below plan. H1 adjusted EBIT was −€229m, the net result −€542m, and FY guidance now spans €1.7bn to €2.2bn with net capex lowered to about €2.5bn ⁴. Cash generation is the stabilising factor: adjusted free cash flow was €1.0bn in H1, in line with the prior year, and net debt including pensions stayed at €8.3bn ^{4 5}.

In FY 2025 the Passenger Airlines segment produced 73% of segment revenue but only a 3.6% adjusted EBIT margin ². Logistics earned 9.5% and MRO 7.5%, so the two smaller segments delivered €927m of the group's €1.96bn adjusted EBIT ^{2 1}.

Lufthansa Technik's revenue passed €8bn for the first time in 2025 (+12%), and about three quarters now comes from customers outside the group ¹⁴. Its margin fell from 8.5% to 7.5% on US tariffs, material costs and a weaker dollar; the unit plans more than €2bn of investment over five years ¹⁴. In H1 2026 MRO adjusted EBIT rose 2% to €315m and Logistics 47% to €199m, while Network Airlines lost €468m and Point-to-Point Airlines €252m under the new segment structure ⁴.

Sanctions and compliance. No sanctions designations on the parent or main operating airlines. The US DOT fined Lufthansa $4m in October 2024 over the treatment of Jewish passengers in 2022, under a consent order ¹⁵.

State aid. The 2020 recapitalisation was repaid in 2021, but its approval has been annulled. The Court of Justice dismissed Lufthansa's appeal on 23 April 2026, and the Commission, which has been re-examining the measure since 2024, must now reach a new decision ¹⁰. The financial consequence cannot be quantified from public sources.

Labour. Strikes cost about €450m in 2024 ⁷ and at least €150m in Q2 2026 ⁵. The pilots' pension dispute and cabin-crew negotiations remained the main operational risk in 2026 ¹⁰.

Fuel. Additional fuel cost of about €750m in Q2 2026 drove the earnings decline ⁵.

Credit. BBB- at S&P, Fitch and Scope and Baa3 at Moody's, all stable; S&P affirmed in May 2026 after the ITA announcement ⁹. Liquidity of €10.7bn ⁴ offsets the event risks above.

Lufthansa, IAG and Air France-KLM are the three large European network groups. Lufthansa has the highest revenue but converts the least of it into operating profit ^{1 12 13}. IAG's 2025 operating profit before exceptional items was €5.0bn on €33.2bn of revenue ¹²; Air France-KLM reported a €2.0bn operating result on €33.0bn ¹³.

Two structural factors explain much of the gap. Lufthansa's home market is Germany, where airlines face high fees and taxes, a point Ryanair raised in the state-aid case ¹⁰. Its labour costs and recurring strikes have weighed on Lufthansa Airlines, the core carrier ⁷. Offsetting strengths are a multi-hub network (Frankfurt, Munich, Zurich, Vienna, Brussels), a large MRO business that peers lack at this scale, and a profitable cargo airline ^{2 14}. The ITA majority will add Rome as a hub once closed ¹¹.