AirAsia Group posts net loss for Q2

Carrier tries to put a positive spin on COVID-19 shutdown

Tony Fernandes. (PHOTO: Shutterstock)

Use this oneMalaysian airline AirAsia reported Tuesday (25 August) that it posted a net loss of RM1.2 billion (US$287.76 million) , compared to RM47 million in profit in the previous corresponding quarter. The loss was attributed primarily to a shortfall in revenue amid subdued travel demand due to lockdowns and border restrictions worldwide as well a realised hedging loss of RM199 million The consolidated group posted second quarter revenue of RM119 million, down 96 percent from RM2.9 billion in the second quarter of 2019. Airline revenue declined 98 percent year-on-year as capacity was significantly reduced due to the fleet hibernation at the end of March, prior to a gradual resumption of domestic operations from the end of April as travel restrictions eased. The airline revenue in the quarter was also negatively impacted by RM60 million in refunds. Less impacted in the quarter, non-airline revenue declined 55 percent year-on-year.

On the group’s outlook, AirAsia Group CEO Tan Sri Tony Fernandes said: “Over recent times, we have successfully pivoted from an airline to an all-in-one digital lifestyle company anchored on travel. There is a silver lining in every crisis and we have used the downtime to review every aspect of our operation and to expand and transform our three core digital businesses – the travel and lifestyle platform, our logistics division Teleport, and fintech through BigPay and AirAsia BIG Loyalty. We exited the exclusive arrangement with Expedia in mid-August and are now fully utilising our recently launched and direct sourced hotel booking platform under, which we expect to see improved margins from, as a result of this new development. We are also pleased that SNAP, our direct sourced hotel+flight bundle deal is gaining momentum while we continuously push for more activities to add to our platform. Eventually, the platform will include BigPay and AirAsia Big Loyalty which will further increase the velocity of transactions.”

For the full report, click here.

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