Copa (NYSE:CPA) executives struck an upbeat tone on the carrier’s fourth-quarter earnings call, citing strong demand across the region, continued cost discipline, and operational performance that management said remains a core differentiator as the airline enters 2026 with double-digit capacity growth plans.
Fourth-quarter performance and operating metrics
Chief Executive Officer Pedro Heilbron said Copa delivered “another quarter and full year of strong financial and operational results,” pointing to rising capacity and steady unit revenue. For the fourth quarter, Copa increased capacity 9.9% year-over-year while passenger traffic rose 10.1%, driving a 0.2 percentage point improvement in load factor to 86.4%.
Operating margin was 21.8% for the quarter, and would have been 22.5% excluding the non-cash maintenance adjustment, management said.
Full-year 2025 results: margins and profitability
On a full-year basis, Heilbron said capacity grew 7.8% year-over-year and passenger traffic increased 8.6%, lifting load factor 0.7 percentage points to 87%. RASM declined 2.6% to $0.112, while CASM decreased 3.6% to $8.6 and ex-fuel CASM decreased 0.7% to $5.8. Copa reported a full-year operating margin of 22.6%.
Chief Financial Officer Peter Donkersloot provided additional detail, reporting fourth-quarter net profit of $172.6 million, or $4.18 per share, a 5.3% year-over-year increase in earnings per share. Operating profit was $209.6 million for the quarter.
Donkersloot said results included two notable items: the $7.2 million non-cash maintenance-related adjustment and a $6 million foreign currency loss primarily tied to the devaluation of the Brazilian real during the quarter, which he noted had recovered in early 2026. Excluding those items, Donkersloot said net profit would have been $184.1 million, or $4.46 per share, and operating margin would have been 22.5%.
For full-year 2025, Donkersloot reported net profit of $671.6 million, or $16.28 per share, representing an 11.9% year-over-year increase in earnings per share. Operating income reached $819 million, up 8.8% year-over-year, while operating margin improved by 0.8 percentage points versus 2024 to 22.6%.
Operational reliability, network expansion, and fleet plans
Heilbron highlighted Copa’s operational reliability, saying the airline was recognized by Cirium for the eleventh time as the most on-time airline in Latin America in 2025 with a 90.75% on-time performance, which he said was the highest in the Americas and second best globally.
On the network, management said Copa launched service from Panama to several destinations between December and January, including Los Cabos (Mexico), Puerto Plata and Santiago (Dominican Republic), Maracaibo (Venezuela), and Salvador Bahia (Brazil).
Fleet growth was also a focus. Copa took delivery of four Boeing 737 MAX 8 aircraft during the quarter and ended 2025 with 125 aircraft. Heilbron said Boeing updated the 2026 delivery schedule and Copa now expects to add eight 737 MAX 8s in 2026, ending the year with 133 aircraft.
Balance sheet, shareholder returns, and capital deployment
Donkersloot said Copa ended the fourth quarter with $1.6 billion in cash, short-term, and long-term investments, which he said represented 44% of last-12-month revenue. He also cited about $500 million in pre-delivery deposits and 47 unencumbered aircraft, alongside total debt of $2.3 billion. The company’s adjusted net debt to EBITDA was 0.6 times, and its average cost of debt—comprised solely of aircraft-related financing—was 3.6%, the CFO said.
On shareholder returns, Donkersloot announced the board approved a quarterly dividend of $1.71 per share for 2026, to be paid in March, June, September, and December, subject to quarterly ratification. The first payment is scheduled for March 13 to shareholders of record as of February 27.
Management also addressed share repurchases in the Q&A. Heilbron said the company has a $200 million buyback program approved by the board and has executed “more or less half of it,” with the remaining authorization still open and no end date specified.
2026 outlook: capacity growth, RASM assumptions, and cost targets
For 2026, management guided to capacity growth (ASMs) of 11% to 13% year-over-year and operating margin of 22% to 24%. The company’s outlook assumes a load factor of approximately 87%, unit revenue of about $11.2, ex-fuel CASM of about $5.7, and an all-in fuel price of $2.50 per gallon. Donkersloot said the ex-fuel CASM assumption aligns with the company’s long-term target of reaching $5.6 by 2028.
In the Q&A, Heilbron said stronger local currencies—particularly in South America—tend to support demand and yields, and management said it was seeing improved demand and better yields amid stronger currencies. However, he emphasized the company was not “banking on” currency strength for the full year given regional volatility.
Executives also discussed why the company is maintaining its unit revenue guidance while adding capacity. Heilbron said the growth plan includes a meaningful full-year effect from 2025 capacity additions, plus added frequencies largely in markets where additional capacity is needed. He also said Copa has been “catching up” on Boeing deliveries after being behind in 2023 and 2024, which influenced how capacity is being deployed.
On costs, management pointed to initiatives including a continued full-year benefit from sales and distribution changes, densification projects, and the scale benefit of growth on fixed and semi-fixed costs. Heilbron cited overhead discipline and additional benefits expected in sales and distribution as areas supporting the company’s cost outlook.
Separately, management addressed several market-specific topics:
- Venezuela: Copa is flying twice daily to Caracas and nearly daily to Maracaibo, with plans to gradually return to additional Venezuelan cities over 2026. Management said Venezuela is not expected to be material to guidance.
- Wingo operations: Heilbron said Wingo has resumed service with “seven” daily frequencies from Bogotá to Caracas and plans to restart Medellín to Caracas soon. Wingo received a 10th 737-800 in the second half of last year, though management said Wingo is not expected to grow much in 2026.
- Cuba fueling: Heilbron said Copa can tanker fuel from Panama and avoid refueling in Cuba with minimal passenger capacity impact, while holding back belly cargo to enable the strategy.
- World Cup demand patterns: Heilbron said the 2026 World Cup is expected to shift travel patterns and the airline is working to manage directional demand changes; he noted Copa plans to add extra sections to Toronto where Panama will play its first two games.
About Copa (NYSE:CPA)
Copa Holdings, SA (NYSE:CPA) is a Panama?based aviation holding company that provides passenger and cargo air transportation across the Americas and the Caribbean. Through its principal subsidiary, Copa Airlines, the company operates a modern fleet of Boeing 737 aircraft, offering scheduled flights that connect passengers through its Tocumen International Airport hub in Panama City. The company also offers dedicated cargo services under the Copa Cargo brand, leveraging belly hold capacity on its passenger flights to transport freight throughout its network.
The roots of Copa Holdings trace back to 1947, when Compañía Panameña de Aviación began operations as the flag carrier of Panama.
