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British Airways owner IAG beats second-quarter profit estimates

IAG, the owner of British Airways, reported earnings for the second quarter that were better than expected on Friday. This was due to strong demand from transatlantic travelers despite concerns about possible knock-on effects caused by President Donald Trump’s tariff war.

Air France-KLM, Lufthansa and other European airlines have largely avoided the turmoil caused by tariffs. Both companies reported strong second quarters this week and confirmed their annual forecasts.

IAG posted an operating profit for the third quarter of 1,68 billion euro ($1.92 billion), compared to the average analyst forecast of 1.4 million euros, according to an LSEG survey. This is up 35% compared to a profit last year of 1.2 billion euro.

"We continue benefiting from the trend of structural shifts in consumer spending to travel." We continue to focus on our core geographies and market-leading brands, where we see strong performance," said Chief Executive Luis Gallego in a press release.

The group confirmed that it had made its full-year forecasts, and noted that there was strong demand for its products in North America as well as Latin America.

U.S. Airlines haven't fared well. Delta pulled its full-year forecast this spring because of concerns over falling demand.

IAG was one of the best performers in terms of share performance compared to other European carriers over the past few years. However, this year it has fallen behind rivals Lufthansa & Air France-KLM who have recovered from their cost pressures.

(source: Reuters)