Air Canada shares rose after the airline reported fourth-quarter revenue that topped estimates, with strength in domestic and Atlantic travel offsetting continued softness on U.S. transborder routes. The carrier also outlined fleet expansion plans as it moves through a new investment cycle.
BNN Bloomberg spoke with John Di Bert, chief financial officer at Air Canada, about shifting capacity away from weaker transborder markets, rising aircraft deliveries and how the airline is balancing growth with shareholder returns.
Key Takeaways
- Fourth-quarter operating revenue rose 6.8 per cent year over year to C$5.77 billion, beating expectations as domestic and Atlantic routes drove growth.
- U.S. transborder revenue remains down roughly 10 to 15 per cent, but management says demand has stabilized and capacity has been redeployed.
- Adjusted Ebitda rose 25 per cent from a year earlier to C$867 million, while 2026 guidance calls for between C$3.35 billion and C$3.75 billion.
- Free cash flow declined year over year as the airline ramps up a multiyear fleet renewal, with about 70 aircraft expected by the end of 2028.
- Air Canada operates roughly 1,300 flights daily and carries about 45 million passengers annually, underscoring the scale of its network repositioning strategy.
Read the full transcript below:
ANDREW: Let’s talk now to the CFO of Air Canada, John Di Bert. Thank you very much indeed for joining us.
JOHN: Good morning, Andrew. Thanks for having me.
ANDREW: Really appreciate it. I’m just looking back at the history of the company over the past decade or so. We know that 2020, 2021, even 2022 were so tough. You bled almost $4 billion in free cash flow in 2020, almost $3 billion in 2021. You’re back into positive cash flow. One thing I’m curious about, though, is the Atlantic is your biggest single source of revenue. Is that essentially flights to Europe?
JOHN: Yeah, our transatlantic network is phenomenal. It continues to grow, but we also have a very strong international presence in Asia. So transpacific is very strong as well. Don’t forget, we operate out of three major hubs — Montreal, Toronto and Vancouver. We are an international airline by all accounts, equally strong in the Caribbean and southern destinations, continuing to open up Latin America. So a very well-diversified airline with clearly a lot of strength on the transatlantic network right now.
ANDREW: It’s interesting. According to Bloomberg, the Atlantic was 28 per cent of your revenue last year. Canada was 24 per cent, and then transborder to the States dropped below 18 per cent. Is that category still under pressure, with Canadians not vacationing in the U.S.?
JOHN: We clearly had an adjustment in the spring of 2025, so that was the most impactful change. It was down about 12, 13 per cent or so and has kind of stayed at that level. Now it’s really stabilized at kind of minus 10 to 15 per cent, depending on the routes and so on. So I think transborder has stabilized. The real positive for Air Canada is we have so many options with our network, a very agile ability to reposition aircraft. We’ve done that very well. We’ve opened up much more Latin America. The Caribbean continues to do well. So there’s a great diversity. And I would say, on top of that, corporate travellers still do travel through the U.S. quite a bit. And we also have very strong sixth-freedom traffic, which brings Americans through Canada to the world.
ANDREW: You got an upgrade in 2024 from S&P. You went up to double-B from double-B-minus. You’ll update me if you’ve been upgraded since then, but you’re still sub-investment grade. Does that complicate life for you as a CFO? It presumably increases your borrowing costs?
JOHN: Well, I’d say that overall we have a pretty balanced capital allocation strategy. We keep low debt right now, about 1.7 times our earnings, or net debt leverage. Our borrowing capacity is very strong. We get very, I would say, almost investment-grade-like cost of capital, to be honest with you. Aircraft are also very liquid, very strong assets and therefore produce fairly competitive debt pricing when you do finance them. So overall, I think we have a balanced approach here. We want to, one, invest in the airline. Two is we want to make sure we keep a strong balance sheet. And three is make sure that we return capital and cash to investors. And we’ve been doing all three, I’d say, rather well, particularly since 2024 through 2025, and we’ll continue to even do better in 2026 and 2027.
ANDREW: I know this is volatile and very dependent on capital spending, and you have been buying a lot of new aircraft, but according to Bloomberg data, your free cash flow dropped to about three-quarters of a billion dollars last year, and it was about $1.3 billion in 2024. Why was there that drop in free cash flow?
JOHN: We’re starting to ramp up our investment cycle. We’re going to take on about 70 aircraft between here and the end of 2028. Last year was, I believe, 15 aircraft. We’ll have another 35 aircraft delivered in 2026, and that will continue through ’27, ’28. So we are going through an investment cycle. It will modernize our fleet. It’ll also add so much more network capacity and optimization. In 2019, we were running at about 113 billion available seat miles, total capacity of our network. And in 2025, that’ll be about 105 billion. So we haven’t yet recovered back to our full 2019 levels, which leaves a lot of great opportunity for us to continue to grow. And that’s where the investments are going. So at $750 million, still about three and a half per cent of revenues, feel good about that. We deployed $1.3 billion to buybacks of $2 billion of total free cash flow generation in the last 24 months. We’ve managed our leverage to be very, very competitive, about 1.7 times, and we’re investing in the fleet. I feel very good about a balanced allocation of capital.
ANDREW: We’re tight for time, and I’m sorry about this, but The Globe and Mail says that more than 90,000 air passenger complaints against all of the airlines are backed up in the system. It sounds like your industry is antagonizing a lot of customers.
JOHN: It’s a difficult process, and we acknowledge that there is some administrative burden and bureaucracy in there. I think it really needs solutions, both with the regulator and the airlines together. We do our very best to process all these claims. These claims then sometimes do get re-administered at the CTA level. Technology needs to play a role. And I think smoothing out regulation so it’s easier to apply and easier to interpret will also help. There are opportunities for everybody, and we would like to have less burden as well as anybody else. And clearly, we want our passengers to have a seamless experience when they deal with us. When we don’t live up to their expectations, we do want to make sure that they’re compensated properly. We do need to see some relief in the overall administration, and we want to be part of that.
ANDREW: Just a reminder — your job is complex, to say the least. You’re dealing with a highly capital-intensive industry. Give us an idea. How many flights does Air Canada do each day right now? Can you give us a ballpark?
JOHN: I think it’s about 1,300 flights in total every single day. Like 1,300 flights a day. It’s a logistical beast, and 45 million passengers a year. And so it gives you a pretty good idea. It’s 1,300. And we have an extraordinary workforce that honestly is on top of every one of those flights — food on the plane, bags on the plane, get you to the destination. And we do this with a lot of commitment and conviction.
ANDREW: Forty-five million people a year. And what would you spend most of your time on, would you say, personally?
JOHN: That’s a great question. I think it’s really helping the airline navigate growth. We’re in a growth cycle. It’s a very fine balance, as you’ve well indicated, between managing a strong balance sheet, returning capital to investors, and being able to bring and deploy capital to the airline effectively. I spend a lot of time making sure that we’re delivering our 2028 objectives. We put objectives out with our investor day in December of 2024. We’re fully committed to creating value, but also creating an exceptional airline for our customers. And doing all of that requires work from an incredible team. And the management team here is phenomenal.
ANDREW: Thank you very much. I really appreciate it.
JOHN: Thank you so much, Andrew.
ANDREW: John Di Bert, CFO at Air Canada.
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This BNN Bloomberg summary and transcript of the Feb. 17, 2026 interview with John Di Bert are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
