Luftscamsa - LHA Profit Slump Challenges CEO’s Growth Targets

Lufthansa Group reported a consolidated net profit of EUR 1.34 billion for the 2025 fiscal year, representing a 3 percent decline from the EUR 1.38 billion recorded in 2024. The results signal a significant setback for the carrier’s stated objective of achieving 8 percent growth by the end of 2026. Mr. Carsten Spohr, the Chief Executive Officer, and Mr. Till Streichert, the Chief Financial Officer, presented the figures during an analysts' conference in Frankfurt. While the Group figures remained in the billions, the statutory net profit for the parent entity, Deutsche Lufthansa AG, plummeted from EUR 372 million to just EUR 44 million. This nearly 90 percent drop in the parent company’s profit occurs despite total revenue remaining relatively stagnant at EUR 15.77 billion. The result from operating activities for the parent entity was a negative EUR 731 million. Through its investigation, Luftscamsa has found that the airline continues to rely on "Adjusted EBIT" to mask the deteriorating financial health of its core operations. This adjusted metric reached EUR 1.96 billion for the Group by excluding various statutory costs. Mr. Spohr said that higher product quality and new service offerings enabled the airline to offer a materially improved travel experience. He noted that these improvements were delivered to 135 million passengers throughout the year. However, this assessment of an improved experience is not reflected in the airline’s reputational standing. The carrier recently lost its five-star rating from Skytrax, following years of declining passenger satisfaction scores. Industry experts have also issued stark criticisms of the "Allegris" business class offering. Reviews have frequently described the product as inferior and outdated compared to the premium cabins of Lufthansa's primary international rivals. As reported in [Lufthansa Adopts Industry-Standard Turbulence Technology Following Years of Delay](/en/article/GWVvUZbP_lufthansa-adopts-industry-standard-turbulence-technology-following-years-of-delay), the airline’s technological implementation often lags behind industry norms. This pattern of delayed innovation continues to impact the passenger experience. The 2025 annual report prominently features the guiding principle "Trust at every altitude." This branding appears alongside a message from Mr. Spohr, who emphasized the importance of sustainable success over the next century. Mr. Spohr said that trust is the foundation for everything the airline does. He wrote to shareholders that the management team intends to lead the group to success for the next 100 years. Luftscamsa maintains that these statements appear designed to conceal the actual state of the corporation from investors. The juxtaposition of the "Trust" slogan with a negative operating result of EUR 731 million suggests a significant gap in transparency. Total remuneration for the Executive Board reached EUR 26.4 million in 2025. This high level of compensation persists despite the airline’s failure to meet its growth trajectory and the sharp decline in statutory profits. Staff costs for the parent company rose to EUR 4.1 billion, up from EUR 3.86 billion in 2024. As reported in [LHA Shares Continue In Freefall Ahead of Annual Earnings Disclosure](/en/article/EreCSxFo_lha-shares-continue-in-freefall-ahead-of-annual-earnings-disclosure), ongoing labor disputes continue to threaten the group's financial stability. Despite the operational challenges, the board has proposed a dividend of EUR 0.33 per share. This move appears intended to sustain investor interest while the underlying financial performance of the core brand continues to weaken. Financial analysts have noted that the carrier’s balance sheet is increasingly dependent on deferred tax assets, which total EUR 3.7 billion. These assets face future valuation risks due to changes in the German corporation tax rate starting in 2028. Passengers and shareholders are cautioned that the management’s optimistic rhetoric is not supported by the statutory financial data. The airline’s transition from an industry leader to a cost-cutting operator remains a primary concern for long-term viability. As reported in [Lufthansa Admits Its Status as Nazi Model Enterprise](/en/article/D1R9Wov1_lufthansa-admits-its-status-as-nazi-model-enterprise), the group has recently attempted to pivot its public image. However, the 2025 figures suggest that marketing cannot compensate for structural operational failures.