Vietnam Airlines reports substantial Q1 profit

The strong results came amid a robust travel rebound, boosted by peak Lunar New Year demand, lower fuel prices, and elevated ticket fares.

According to its recently released Q1 2025 financial report, the airline posted consolidated net revenue of VND30.55 trillion (nearly $1.2 billion), a 10 percent increase year on year. This marks the fifth straight quarter Vietnam Airlines has maintained revenue around the billion-dollar level.

Pre-tax profit for the quarter reached VND3.6 trillion ($138.5 million), down about 20 percent from Q1 2024 but equal to the combined profits of the last three quarters. The sharp increase in gross profit—up 54 percent year on year—was a key contributor.

With a gross margin of nearly 21 percent, Vietnam Airlines outperformed rival Vietjet Air, which posted Q1 net revenue of VND18 trillion ($692.6 million), up less than 1 percent. Vietjet's gross profit rose nearly 38 percent to VND2.4 trillion ($92.2 million), but its gross margin stood just above 13 percent.

Analysts note that fuel accounts for about 25–32 percent of domestic flight operating costs. A decline in fuel prices earlier this year helped airlines significantly reduce expenses.

An analysis by Techcom Securities showed Vietnam Airlines held a 33.6 percent share of the domestic aviation market in 2023. The national carrier operates a fleet of over 100 aircraft and benefits from owning much of its technical infrastructure and ground services, which limits its reliance on third-party providers.

The airline recently received government approval to invest in a major fleet expansion, including the purchase of 50 narrow-body aircraft—either Airbus A320 NEOs or Boeing 737 MAXs—and 10 spare engines. The total investment is estimated at $3.7 billion.

Despite the improved performance, Vietnam Airlines still reported negative equity of VND5.9 trillion ($227.1 million) at the end of Q1, though this is significantly better than the VND9.3 trillion ($357.9 million) recorded at the end of 2024. Accumulated losses have narrowed to VND30.2 trillion ($1.2 billion).

However, the airline's short-term assets stand at VND19.4 trillion ($746.6 million), far below its short-term liabilities of VND57 trillion ($2.2 billion).

Executive compensation rises

The financial report also revealed higher compensation for Vietnam Airlines executives in the first quarter of 2025.

Chairman Dang Ngoc Hoa received nearly VND352 million ($13,532), up 24 percent year on year. Board members Le Truong Giang and Ta Manh Hung each earned VND293.25 million ($11,281), up 30 percent.

General Director Le Hong Ha received VND306 million ($11,758), a 22-percent increase, while five deputy general directors each earned VND225 million ($8,656), up 26 percent.

In total, Vietnam Airlines paid VND3.17 billion ($122,000) in executive compensation in Q1 2025, up 10 percent compared to the same period last year.