Japan Airlines Co., Ltd.

Business Details

Centered on Japan Airlines Co., Ltd., with participation from J-Air, Japan Air Commuter, Hokkaido Air System, Japan Transocean Air, and Ryukyu Air Commuter. The segment operates international and domestic passenger transport, as well as a cargo and mail business combining cargo space on owned passenger aircraft with dedicated freighters. The revenue base is built on capturing inbound demand and Japan-origin business demand while maintaining high unit prices, and the segment is advancing service quality improvement and fuel efficiency through the introduction of the latest Airbus A350-1000 aircraft.

Recent Overview

Revenue and profit growth led by international routes; EBIT rose 30.5% year on year to ¥145,056 million

In FY2026 (ending March 2026), the Full-Service Carrier Business achieved revenue of ¥1,587,464 million (up 9.3% year on year) and EBIT of ¥145,056 million (up 30.5% year on year). International passenger demand recovered above plan, driven by strong inbound demand as well as Japan-origin business demand exceeding expectations. Contributing factors included the launch of the new Narita–Delhi route, daily operation of the A350-1000 on 12 flights across 5 routes, and the capture of substitute demand for European routes resulting from the worsening Middle East situation in March. Domestic passenger load factor improved significantly to 83.9% (+5.0pt year on year). International cargo revenue increased substantially by 18.7% year on year, driven by collaboration with Kalitta Air and strengthened acquisition of high-value cargo.

Key Products

Growth Drivers

• Expansion of international passenger revenue driven by continued strong inbound demand and recovery of Japan-origin business demand exceeding plan (international passenger revenue up 9.1% year on year)
• Significant improvement in domestic passenger load factor (83.9%, +5.0pt year on year) and demand stimulation through various campaigns
• Strengthened acquisition of Asia–North America cargo demand through scheduled US cargo flights using Kalitta Air's large freighters, and enhanced capture of high-value cargo such as pharmaceuticals, AI-related, and EV-related parts (international cargo and mail revenue up 18.7% year on year)
• Improved service quality and profitability through expansion of A350-1000 routes (daily operation of 12 flights across 5 routes including Haneda–Paris)
• Network expansion including the new Narita–Delhi route (January 2026) and Japan Transocean Air's new Okinawa–Taipei route (February 2026)
• Active capture of substitute demand for direct European flights and India-to-North America connecting demand resulting from foreign airlines' flight suspensions due to the worsening Middle East situation
• International expansion plan based on larger aircraft and increased medium/long-haul fleet under the JAL Group Vision 2035 management plan (FY2030 EBIT target of ¥300.0 billion)

Risks

• Cost increase pressure from yen depreciation and global inflation on aviation fuel costs (¥395,455 million for the full year) and personnel expenses (¥398,484 million for the full year)
• Risk of sudden changes in international demand and rising crude oil prices due to unstable global conditions (geopolitical risks such as the Middle East and Ukraine situations)
• Increased capital expenditure burden and depreciation expense (¥146,645 million for the full year, up 6.7% year on year) associated with large-scale aircraft introduction plans
• Risk of impact on flight operations and brand value from aviation accidents or serious incidents
• Increased personnel expenses and difficulty maintaining flight operations due to labor shortages and rising wages
• Challenging business environment in the domestic market (available seat-kilometers down 0.6% year on year) and risk of delayed profitability improvement