LATAM Airlines Group Cuts Earnings Outlook as Fuel Costs Rise

SANTIAGO — LATAM Airlines Group cut its full-year earnings outlook on November 3 as higher fuel prices squeezed operating profitability, even as third-quarter revenue and net income increased.

The group reported revenue of US$4.6bn, up 18.4% year over year, and net income attributable to shareholders of US$441m, up 16.3%. However, its third-quarter results showed adjusted operating margin falling to 12.5% from 18.1% a year earlier, a decline of 5.6 percentage points.

The average all-in jet fuel price, including hedges, rose 52.1%, producing an estimated US$520m impact compared with the same quarter of 2025, according to LATAM. Adjusted operating income was US$573m.

Higher Revenue, Lower Earnings Guidance

LATAM now expects 2026 revenue of US$17.6bn–US$17.8bn, compared with US$17.3bn–US$17.7bn previously. It reduced its forecast for adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) to US$3.9bn–US$4.05bn from US$4.1bn–US$4.4bn.

The revised outlook assumes fourth-quarter jet fuel prices of US$180 per barrel, compared with US$130 in its August guidance. LATAM also lowered its expected annual capacity growth to 8.5%–9.5% from 9%–10%.

Quarterly adjusted EBITDA fell 4.7% to approximately US$1.1bn. Net income rose despite weaker operating earnings: interest expense fell 29% to US$183m, with the prior-year comparison including a US$105m one-time liability-management charge.

Passenger and Cargo Revenue Grow

Passenger revenue increased 17.8% to US$4bn, supported by capacity growth of 7.7% and a 9.4% rise in passenger unit revenue. Passenger load factor was 83.7%, while premium-segment revenue grew 23%.

Cargo revenue rose 19.5% to US$483m, with 256,000 metric tons transported during the quarter. LATAM Pass reached 57 million members, up 9% year over year. That compares with 54 million at the end of 2025, as Airways reported in its coverage of LATAM's annual results.

LATAM ended September with US$4.4bn in liquidity and adjusted net leverage of 1.5 times.

E195-E2 Flights Planned for November

The group ended September with 390 aircraft after adding three Airbus A320neos, three A321neos and one Boeing 787-9 during the quarter.

LATAM Airlines Brasil (JJ) received its first two Embraer E195-E2s in October. The group says the initial deployment, involving 14 aircraft across 42 Brazilian domestic routes, is scheduled to begin November 30.

The E195-E2 adds a smaller aircraft to LATAM's Brazilian operation. Embraer says the type will open new markets and expand domestic connectivity, with the initial network including eight new routes and four destinations new to LATAM: Cabo Frio, Ji-Paraná, Macaé and Rondonópolis.