Distributing 5.2 billion in dividends and awarding 11 weeks' worth of salaries—why is this airline considered the "most profitable"?

[Text/Observer Network Deng Jun Editor/Zhao Qiankun]

On March 11, Cathay Group released its 2025 financial report. During the reporting period, Cathay Group’s net profit increased by 9.5% year-on-year to HKD 10.828 billion; revenue grew by 11.9% year-on-year to HKD 116.766 billion, reaching a profit high since 2011. Among them, Cathay Group’s airlines and subsidiaries achieved a 13% increase in net profit for the full year, reaching HKD 9.996 billion, making it “China’s most profitable airline.”

After the earnings release, Cathay Pacific (stock code: 00293.HK) stock price rose nearly 6% intraday, closing up 4.4%.

Based on the full-year performance, the Cathay Group board announced a second interim dividend of HKD 0.64 per share (1 HKD = 100 HK cents). Combined with the first interim dividend already paid, the total dividend for 2025 will be HKD 0.84 per share, totaling approximately HKD 5.2 billion. Regarding employee compensation, in addition to the salary increase arrangements for 2026, the group will also distribute discretionary bonuses and profit sharing equivalent to more than 11 weeks of eligible wages.

The Wall Street Journal reported that, according to the international financial data analysis and research platform Visible Alpha’s forecast, Cathay Group’s 2025 performance exceeded analyst expectations of HKD 9.32 billion in net profit and HKD 113.96 billion in revenue. The group’s profit exceeded expectations mainly due to strong net profit performance in the second half of the year, reaching HKD 7.18 billion, a 14% increase compared to the same period last year, nearly doubling the first half net profit.

The financial report also shows that in 2025, Cathay Pacific’s passenger revenue increased by 15.8% year-on-year to HKD 72.454 billion; cargo revenue increased by 1.2% to HKD 24.279 billion. Its Hong Kong Express subsidiary’s passenger revenue grew by 6.7% to HKD 6.394 billion. The group’s total passenger volume reached 36 million, a year-on-year increase of about 27%, setting a new record and surpassing 2019 levels; aircraft utilization per day reached 11.3 hours, up 1.9 hours year-on-year; passenger load factor was 85.3%, up 2%; cargo volume reached 1.6 million tons, a 9.5% increase, recovering to about 79% of 2019 levels.

According to data provided by Cathay Pacific to Observer Network, over the past three years, the company has rapidly advanced reconstruction, not only expanding the route network and increasing destinations but also intensifying flights on popular routes and continuously improving customer experience. Thanks to these efforts, Cathay Pacific and Hong Kong Express added 20 new destinations in 2025, expanding the group’s passenger network to over 100 destinations worldwide.

By the end of 2025, Cathay Pacific’s fleet (including Cathay Pacific, Hong Kong Express, and Greater Bay Airlines) totaled 237 aircraft. The fleet has a high proportion of wide-body aircraft, with significant hub advantages, balanced market layout, and strong resilience to risks.

Industry analysts pointed out that Cathay Pacific’s 2025 financial data indicates that, amid increasingly fierce industry competition, only by combining strategic focus (leveraging hub advantages) with tactical flexibility (service innovation, network optimization) can the airline maintain a leading position in the market.

It is worth noting that 2025 marks the third year of Cathay Group CEO Ronald Lam’s tenure.

According to Hong Kong’s South China Morning Post, after three years of successful reconstruction, all available aircraft of Cathay Pacific are now fully equipped and operational. Ronald Lam stated that in recent years, Cathay Pacific’s recruitment and training scale has reached a historic high, and the staff team has now stabilized, aligning with the company’s development plans.

In terms of market competition, Cathay currently has over 100 global destinations, including more than 20 in mainland China and over 80 international destinations. In 2025, Cathay added two major mainland destinations, Singapore and Urumqi, both highly recognized by the market and especially popular among Hong Kong travelers. Moving forward, Cathay will leverage the increased capacity to further expand its mainland routes and flight network.

Cathay also announced that in 2026, the company will focus on increasing flight frequencies on existing routes, opening more new international destinations, and further enhancing overall passenger experience both in the air and on the ground.

Specific initiatives include: launching direct flights to Seattle on March 30; continuing upgrades of more Boeing 777-300ER aircraft with “Erya” business class; fully refurbishing Airbus A330-300 regional aircraft by the end of the year, introducing a new “Eriyi” business class with lie-flat beds and direct aisle access, and installing new seats in economy class.

On the ground service front, Cathay’s flagship VIP lounge “The Pier” at Hong Kong International Airport will reopen after renovation, and the company plans to open its first Cathay lounge in New York.

Cathay Group Chairman Rupert Hogg stated that the current global geopolitical environment is turbulent, causing unpredictable fluctuations in passenger and cargo volumes and fuel prices. However, with increased flight frequencies and destinations, he expects passenger capacity to grow by about 10% in 2026, driving cargo capacity improvements. He expressed full confidence in the group’s future prospects.

Cathay Pacific’s Chief Customer and Commercial Officer, Liu Kai-shui, believes that the current Middle East situation has driven up fuel costs for long-haul routes to Europe and elsewhere, which may slightly impact cargo capacity. However, the increase in cargo volume in 2026 will mainly rely on the additional bellyhold capacity from increased passenger flights. As the passenger network expands, cargo business is also expected to grow in tandem.

Additionally, Cathay Group will receive eight brand-new narrow-body aircraft in 2026. In the future, the group will also acquire over 100 new aircraft, including narrow-body, regional wide-body, long-haul wide-body, and large cargo planes. Coupled with investments in cabin upgrades, lounge construction, and digital innovation, the group’s total investment will exceed HKD 100 billion.

This article is an exclusive report by Observer Network. Unauthorized reproduction is prohibited.