We love travel more than we hate Qantas

The two universally recognised taboo dinner party topics are politics and religion. In Australia, we should add Qantas – people have polarised and passionately held opinions about the airline’s corporate citizenship bona fides.

So who is winning the argument?

Qantas just released a bumper full-year profit large enough to settle the debate on whether customers have forgiven the airline for its litany of customer-service sins – the lost bags, the ghost flights, the delayed flights – and the industrial relations blunders.

The numbers don’t lie. They demonstrate that most of the flying public’s Qantas scars have healed sufficiently that people are happy to fly with the airline or its budget brand, Jetstar.

Qantas and Jetstar’s planes carried 4 million more people in the 2024-25 financial year than in the previous year – that’s quantitative absolution.

And this is despite the ink having barely dried on the airline having to pay a $90 million penalty for illegally sacking 1800 ground handling staff during the COVID-19 pandemic, and ears still ringing with stinging comments by Justice Michael Lee,  who threw doubt on whether the airline’s contrition was genuine.

Qantas and Jetstar’s planes carried 4 million more people in the 2024-25 financial year than in the previous year – that’s quantitative absolution.

Thursday’s result was the second-largest profit that Qantas has ever produced and, interestingly, it wasn’t mainly generated by higher fares, but by the seemingly insatiable desire of Australians to fly domestically and abroad for holidays. Fares did rise a little over the year, but by less than the consumer price index.

In the years after the pandemic, the pent-up demand to fly away to holiday destinations was easy to understand. The continued strength in demand even in a period in which the cost of living has been elevated highlights how Australians prioritise holiday spending ahead of most other wants.

It also says plenty about the Australian aviation market, in which there are only three major brands and Qantas accounts for two of them. Add to that the fact that Qantas owns the only real budget brand, and cash-conscious flyers have no real choice.

But in the international segment, where competition from other airlines is more robust, Qantas also increased earnings, by 6.7 per cent.

There were particularly strong numbers of customers looking to use the airline’s premium cabins to fly internationally, as people traded up from economy seats to premium economy and business class.

There are various factors behind this, but one of the largest is the retiring Baby Boomers with money. They are wealthier, healthier for longer and want to travel comfortably.

But even for families watching their pennies, research shows people are prioritising holiday travel over other discretionary categories such as entertainment and even white goods.

Jetstar’s new routes are expanding the budget-traveller market, and its best-in-class profit reflects this success.

Meanwhile, even the commercial travel segment of the market, which had been slow to come back after the pandemic, is now picking up.

The near record-making profit will inevitably bring out commentary that more should be going to staff or that it should be funnelled back into lower airfares or used to compensate customers whose details were recently leaked when Qantas fell victim to a cyber hack.

Of the $2.4 billion the group earned in 2024-25, $400 million will go to shareholders as dividends and $1.6 billion will be paid in tax. Meanwhile, Qantas which is keen to mend fences with employees, will give a gift of $1000 in shares each to 25,000 staff.

While some shareholders are said to be grumbling about the chief executive’s pay in light of the recent $90 million court penalty, the double-digit increase in Qantas’ share price after Thursday’s result should quell their concerns.

Many Australians still bear the Qantas scars, but the results show that travelling trumps residual ill feeling.

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