Significant cost cutting ahead, KLM CEO says as Air France-KLM reports record profit

KLM will continue to reduce costs in the coming period. “Structural choices” remain necessary to achieve financial health and become less vulnerable, CEO Marjan Rintel said in an explanation of the annual figures. Air France-KLM posted a record profit of €1.75 billion in 2025, but profitability at the Dutch airline KLM lagged behind that of its sister company Air France.

Last year, KLM achieved a revenue of €13.2 billion, almost 4 percent higher than the previous year. Operating profit remained stable at €416 million. The profit margin was 3.2 percent. “We achieved a stable result, but our costs are rising faster than our revenue. This leaves KLM vulnerable,” said CFO Bas Brouns.

KLM also took cost-cutting measures last year, downsizing 250 office jobs and reducing the size of the management team from five to four. More such measures are needed, Rintel said. “Only through strict cost control and more reliable operations can we achieve structural recovery. External factors, such as increasing cost pressure in the Netherlands, make this task even more urgent. 2026 will therefore be a crucial year in which we must accelerate our transformation to maintain our position in a competitive market.”

The CEO did not elaborate on the details of upcoming budget cuts or the potential job losses. “We are always looking at how we can optimize the company as efficiently as possible.”

KLM hopes that the cost-cutting will increase its profit margin. “We aim for an 8 percent profit margin in the coming years. To achieve this, we are taking additional measures to strengthen our operations, increase revenue, and reduce costs.” Rintel said that cost-cutting is not a goal in itself, but a prerequisite for continued investment in a future-proof and competitive KLM, including a cleaner and quieter fleet.

The airline had a challenging year, partly due to technical problems with the fleet and ongoing geopolitical unrest. Russian airspace remains closed, and restrictions were in place over other areas. This made routes longer and more complex.

It is also relatively expensive to fly from Schiphol Airport, KLM’s home base. CEO Rintel is therefore unhappy with Schiphol’s announcement that it will freeze airport fees in the coming years, following recent increases, including a 41% hike last year. She wanted Schiphol to lower them.

“We compete with neighboring countries, but passengers in the Netherlands will pay an average of about 50 percent more in 2027 than in neighboring countries. This is a result of taxes, airport fees, and air passenger tax. Passengers are therefore switching to Düsseldorf and Brussels,” Rintel said.

Air France-KLM

Air France-KLM as a whole had a great year, posting a record profit in 2025. The airline carried more passengers and managed to sell more tickets for more luxurious seats, which generated more revenue. Lower fuel costs also provided a significant windfall.

Operating profit, the result from Air France-KLM’s core activities, rose for the first time to just over €2 billion, €403 million more than a year earlier. Net profit also reached a record level of €1,75 billion, more than three times the previous year. A large portion of this was made up of paper profits due to exchange rate fluctuations.

KLM’s operating profit remained stable last year, while Air France’s result rose by 39 percent. Transavia suffered an operating loss of €49 million. The budget subsidiary carried significantly more passengers in 2025, but suffered from increased competition on routes to European holiday destinations, which depressed ticket prices. This was because airlines flew fewer flights to the Middle East and shifted those flights to Europe. More Dutch travelers also diverted to German airports.

Air France-KLM also immediately reported a setback in the new fiscal year. In the first days of 2026, winter weather caused a financial setback of €90 million. At Schiphol, KLM was forced to cancel hundreds of flights because there was insufficient time to clear aircraft and runways of ice and snow.