By Brazil Stock Guide – LATAM Airlines Group (NYSE: LTM) closed the third quarter of 2025 in a rare sweet spot for the aviation industry: strong demand, expanding margins and rising cash reserves. The company delivered a US$379 million net profit, up 25.8% from a year earlier, supported by higher traffic, disciplined cost execution and a more stable operating environment across Latin America.
Passenger volumes reached 22.9 million, consolidated capacity grew 9.3% and load factor held at 85.4%, even as the airline added domestic routes and strengthened international operations.
Financial performance was equally robust. Adjusted EBITDAR reached US$1.15 billion, nearly 40% higher year over year, driven by premium-yield growth, solid passenger revenue and more favorable fuel costs. Adjusted operating cash flow climbed to US$859 million, lifting liquidity to US$3.6 billion and helping maintain adjusted net leverage at 1.5x — a rare level among Latin American carriers.
CFO Ricardo Bottas said the quarter highlighted the airline’s consistency in combining efficiency with customer focus. Premium demand remained a core driver, with revenue in the segment up more than 15%, supported by upgraded lounges, revamped cabins and better service delivery. In Brazil, unit revenue rose 14% despite network expansion, while Spanish-speaking subsidiaries posted an 18% increase in PRASK, reflecting steady strength across Chile, Peru and Colombia.
The adjusted ex-fuel CASK increased 11.6%, a natural effect of cost normalization after years of suppressed spending on personnel, marketing and passenger services — while the pilot strike in Chile, which began on November 12, will impact 4Q25, with no effect on the quarter reported.
LATAM also advanced its long-term fleet strategy by announcing the acquisition of up to 74 Embraer E195-E2s, adding efficiency and flexibility to serve regional markets with high growth potential. The group ended the quarter with 363 aircraft, with additional deliveries expected in the fourth quarter to reinforce hubs in São Paulo, Santiago and Lima.
With clearer visibility for the full year, LATAM raised its guidance once again: adjusted EBITDAR is now expected to reach US$4.0–4.1 billion, and adjusted operating margin was upgraded to 16%–16.5%. Ex-fuel CASK should close slightly above initial projections due to renewed operational investment, capacity expansion and the resumption of hiring and commercial activity across the network.
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