Air Canada has just made a significant adjustment to its financial fortunes. Though the union’s recent strike by flight attendants will ding its operating income through the second quarter by about an estimated $375 million. In their PR on September 24, 2025, the airline decided to announce their expected operating income for the upcoming quarter. It today lowered its revenue guidance, now expecting to generate just $250 million to $300 million. An airline may be hit with a sudden, large reduction in capacity. Yet at the same time, it faces an even greater financial burden from the ongoing labor disruption.
The airline’s total capacity will be down about two percent from last year. This drop is largely attributed to the net cancellation of more than 3,200 flights. The strike has brought operations to a stand-still. It has forced USPS to incur about $90 million in additional costs in the form of customer refunds and overtime labor.
Post-strike, flight attendants were able to roundly defeat the employer’s proposed wage proposal at the ballot box. Under pressure to act, Air Canada has now agreed to refer the wage negotiations for mediation. It’s what Air Canada and the flight attendants had mutually agreed would be next steps. They thought it would put an end to the years-long fights.
The net impact of the labor disruption on finances goes far deeper than immediate operational expenses. Air Canada has made an estimate of its lost revenue: $430 million. These losses were due to refunds, customer credit, and a decrease in travel reservations. Despite these challenges, the airline managed to save $145 million as a result of lower fuel costs during this period.
Prior to these announcements, Air Canada had estimated its 2025 adjusted EBITDA at $3.2 billion–$3.6 billion. This guidance is a clear signal of the company’s bullishness on their business moving forward. Yet, this optimistic forecast was put on ice in August as a result of confusion over labor negotiations and operational continuity.
The management at the airline is committed to continue maneuvering through these challenges while continuing to provide low-cost, high-quality service to the airline’s customers. As they work towards resolving the labor dispute and stabilizing operations, Air Canada aims to restore confidence among its stakeholders.
