Korean Air posts higher quarterly profit despite fuel cost jump

Korean Air's third-quarter operating profit rose 11.9%, which the carrier attributed to margin-focused capacity management during a period of higher fuel prices.

Operating profit for the three months ended 30 September was W421 billion ($314 million), the SkyTeam member said. Operating revenue climbed 26% to W5 trillion, an all-time high for the airline.

Growth came from strong inbound traffic into South Korea and higher transit demand through its Seoul Incheon hub, according to the carrier. America-China and Europe-South East Asia transit traffic benefited in particular, which the airline linked to a weak Korean won and disruption elsewhere attributed to a prolonged Middle East conflict.

Korean Air also cited margin-focused capacity controls on its America and Japan network and charter operations that carry higher yields.

Costs rose alongside revenue. Fuel expenses for the quarter were up 67% year on year, pushing total operating costs to about W4.6 trillion, a 27% increase. The airline expects fuel cost pressures to persist through the end of the year.

Outbound demand is softening, the carrier said, under pressure from fuel surcharges and the weaker won.

Cargo saw strong growth on steady demand for high-value AI and semiconductor components. Korean Air said its passenger business will seek to improve profitability by concentrating on inbound and transit traffic, while the cargo business aims to lift revenue through flexible capacity deployment, targeting the traditional year-end peak season and continued demand from the AI and semiconductor sectors.