Airline earnings glossary for non experts
We’ve defined some of the most important financial terms on the airline earnings reports to help you determine what metrics are most important to your business.
| Term | Meaning |
|---|---|
| Operating revenue | All income earned from flight operations (ticket sales, cargo, ancillary fees). |
| Operating income | Profit after operating costs but before taxes and interest, shows efficiency of core airline activity. |
| Operating margin | Operating income as a percentage of total revenue, a key measure of profitability. |
| Net income | Final profit after all expenses, taxes, and interest. |
| Earnings per share (EPS) | Net income divided by total shares, indicates value returned to shareholders. |
| TRASM (Total Revenue per Available Seat Mile) | Revenue earned for every seat flown one mile, measures revenue quality. Higher TRASM = stronger yields or better mix. |
| PRASM (Passenger Revenue per Available Seat Mile) | Same as TRASM but limited to passenger revenue only (excludes cargo and ancillaries). |
| CASM (Cost per Available Seat Mile) | Total cost to fly one seat one mile, measures cost efficiency. Lower CASM = better cost control. |
| CASM-ex | CASM excluding fuel and special items, used to show underlying cost trends. |
| Load Factor | Percentage of seats sold on all flights, indicates how full planes are. |
| Yield | Average fare per passenger mile, drives TRASM. |
| Market Cap | Total market value of the company’s shares—investor measure of airline health. |