Highlighting some unusual happenings in our industry:
- That elusive profit margin seems to have rebounded rather heftily, after years of volatility (pandemic, inflation, grounding of fleets, Inclement weather, etc).
- Domestic travel recovery (due to ease, safety, and demand bounce) was expected to grow exponentially, but what a surprise to see the strength of cross-border, international travel as people venture out, increasingly comfortable travelling globally.
- 2025 saw a rapid rise of tech-driven tourism and the ”authentic experience” demand. AI-powered trip planning, personalized itineraries, smart airport and security systems, digital check-ins, and “travel commerce” tools have become the trend.
- Environmental promise vs. reality check showed sustainability ambitions clashed with the constraints of aging fleets, supply-chain disruptions, high maintenance demand, delays in new aircraft deliveries, and a serious shortage of Sustainable Aviation Fuel (SAF).
The facts and figures
The rebound in tourism — and travelers seeking diverse, international destinations — is sustaining demand for air travel, which supports profitability in aviation.
According to the International Air Transport Association (IATA), the global airline industry remains on a growth trajectory: revenues are projected to exceed US$1 trillion in 2025 with total net profit estimated at US$39.5 billion, rising to $41 billion in 2026. (Still, we need to keep in mind that those numbers imply a net profit margin of only 3.9% or US$7.70 per passenger – about as much as Apple.com makes from each iPhone cover it sells.) Global passenger load factors have been at levels of over 80% (all-time highs) since 2023 and are forecast to rise to 83.7% in 2026. showing airlines are successfully filling seats, especially as the fleet shortage and other constraints persist. Global air travel demand remains robust, driven by stable global GDP growth of over 3%. October 2025, for example, saw a 6.6% increase in global air traffic versus the prior year.
Despite demand, airlines face headwinds: supply-chain bottlenecks make it difficult to get spare parts, spare aircraft, or new planes for fleet renewal. A total of 5,340 fewer aircraft than expected have been delivered to the global fleet, leading to a growing backlog that now amounts to almost 17,000 aircraft, about 60% of the active global fleet. That pushes airlines to lease older planes or keep aging fleets in service. Operating costs continue to climb — maintenance, labor (28% of total airline costs), and compliance (e.g., environmental regulations) are growing burdens. Fuel remains a big cost driver at 26% of total industry costs; while there are efforts toward sustainable aviation fuel (SAF), supply remains capacity-constrained because the return on investments in SAF remains lower than similar investments in fossil fuels. This highlights the challenge of ensuring that aviation can continue to drive the global economy while also reducing its environmental impact.
Worldwide, international travel is rebounding strongly, while domestic travel growth is more mixed depending on the region. Passenger growth in emerging markets is more robust in developing regions, albeit off a relatively small base and accounting for a small percentage of global traffic.
On the tourism side, destinations and service providers are adapting, emphasizing unique, local-culture experiences; leveraging technology and personalization; and shifting away from mass-tourism models. Globally, international tourist arrivals grew in 2025. For example, in Q1 2025, arrivals rose ~5% compared to Q1 2024 across many regions.
There is a noticeable shift toward more meaningful travel: travelers, and especially millennial and Gen-X travelers, are increasingly seeking authentic, local, and culturally rich experiences rather than just traditional sightseeing. This includes interest in off-season travel, less-crowded destinations, immersive local experiences, and a desire for more “real connections.” Technology is playing a larger role as well: AI-driven travel tools (planning, booking, personalization), contactless services, and digital platforms are more widely adopted — reshaping how people discover and organize travel.
Flyingcarpet.travel is our solution.
