Global Air Travel Set to Reach 5.2 Billion Passengers in 2026 as Industry Profitability Strengthens

The global aviation industry is poised for another year of steady growth in 2026, with passenger numbers expected to reach 5.2 billion, a 4.4% increase over 2025, according to the latest outlook from the International Air Transport Association (IATA). Air cargo volumes are also projected to rise, reaching 71.6 million tonnes, up 2.4% year‑on‑year, as the sector continues to demonstrate resilience amid shifting global trade patterns.

IATA expects airlines to deliver a 3.9% net margin and a $41 billion profit in 2026, an improvement that comes despite persistent challenges including supply‑chain bottlenecks, geopolitical tensions, sluggish trade growth and rising regulatory pressures.

“Airlines have successfully built shock‑absorbing resilience into their businesses that is delivering stable profitability,” said Willie Walsh, IATA’s Director General. “That’s extremely welcome news considering the headwinds the industry faces.”

Despite the positive outlook, Walsh cautioned that the industry’s financial performance still falls short of covering its cost of capital, a long‑standing structural issue.

“Industry‑level margins are still a pittance considering the value that airlines create by connecting people and economies,” he said. “They stand at the core of a value chain that underpins nearly 4% of the global economy and supports 87 million jobs. Yet Apple will earn more selling an iPhone cover than the $7.90 airlines will make transporting the average passenger.”

Walsh added that profitability remains uneven across the aviation value chain, with engine and avionics manufacturers and several service providers earning significantly higher margins. He argued that rebalancing profitability, reducing regulatory and tax burdens, and improving infrastructure efficiency would unlock greater economic benefits globally.

Air cargo continues to outperform earlier pessimistic forecasts, buoyed by strong e‑commerce demand and shifting trade flows influenced by US tariff policies.

“The resilience in air cargo has been particularly impressive,” Walsh said. “As trade flows adapt to a protectionist US tariff regime, air cargo has been the hero of global trade, supported by robust e‑commerce and semiconductor shipments tied to the boom in AI investments.”

He noted that air cargo played a critical role in front‑loading shipments ahead of tariff deadlines and redirecting goods to new markets when US‑bound cargo faced restrictions.

Industry revenues are expected to grow 4.5% to $1.053 trillion in 2026, outpacing operating expense growth of 4.2% to $981 billion. This should result in a modest $1.5 billion improvement in net profitability.

Macro economic conditions are mixed. Global GDP growth is forecast to remain stable at 3.1%, and inflation is expected to ease to 3.7%, offering some relief. However, world trade growth is projected to remain weak at 0.5%, limiting upside for cargo markets.

Passenger ticket revenues are forecast to reach $751 billion in 2026, up 4.8% from 2025. This will be driven by a 4.9% increase in revenue passenger kilometers (RPKs). Yields are expected to remain broadly stable, while the global passenger load factor is projected to hit a new record of 83.8%, supported by tight aircraft supply.

Ancillary revenues such as baggage fees, seat selection and onboard sales are expected to rise 5.5% to $145 billion, now accounting for nearly 14% of total airline revenue, up from pre‑pandemic levels.

Cargo revenue is projected to reach $158 billion, a 2.1% increase over 2025. Growth will be driven by time‑sensitive shipments and e‑commerce, with cargo tonne kilometers (CTKs) expected to rise 2.6%. Cargo yields are forecast to remain stable, staying roughly 30% above pre‑pandemic levels despite the broader slowdown in global trade.

Taken together, the projections point to an industry that has regained its footing but is still working toward long‑term financial sustainability. Passenger demand remains robust, cargo continues to outperform expectations, and revenues are set to rise faster than costs; all signs of a sector that has learned to operate with greater resilience and discipline.

Yet the persistent gap between profitability and the cost of capital underscores how much structural reform is still needed across the aviation value chain. As airlines navigate supply‑chain constraints, geopolitical uncertainty and uneven global trade, 2026 is shaping up to be another year of progress built on careful management rather than easy gains. The industry’s ability to maintain momentum in this environment will determine how quickly it can convert stability into truly sustainable growth.