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What factors drove the changes in LATAM Airlines's revenue and profit?

- **Record Financial Performance**: $850M EBITDA (25.9% margin), $242M net income (+66% YoY), and $3.6B liquidity.
- **Customer Satisfaction**: NPS 56 (record high), 9 SkyTrax awards for South America leadership.
- **Fleet Expansion**: 14 new aircraft delivered YTD, 11 A320neo orders for 2026, and 12H2 deliveries.
- **Debt Optimization**: $800M refinancing cuts interest costs by $33M annually, reducing leverage to 1.6x.
- **Growth Momentum**: 2025 ASK growth narrowed to 9.5-10.5% for Brazil, with 2026 ASK growth ~7-8%.

**【CEO Opening Remarks】**
- **Passenger Growth**: Transported 20.6 million passengers (+7.6% YoY), with 8.3% ASK expansion driven by Brazil (+10.9%) and international markets (+9.6%).
- **Customer Satisfaction**: Record-high NPS of 56, winning 9 SkyTrax awards for South America, including best airline staff and lounge.
- **Financial Highlights**: Total revenue $3.3B (+8.2% YoY), adjusted EBITDA $850M (25.9% margin), net income $242M (+66% YoY).
- **Fleet Expansion**: 14 new aircraft delivered YTD, 12 more expected in H2, and 11 A320neo orders for 2026.
- **Shareholder Returns**: $445M returned via dividends and 1.6% share buyback.

**【CFO Financial Commentary】**
- **Cash Flow**: Adjusted operating cash flow $753M, free cash flow $522M, supporting $3.6B liquidity.
- **Debt Optimization**: Refinanced $800M high-cost debt, saving $33M annually, reducing leverage to 1.6x.
- **Margins**: Operating margin 12.9% (vs. 9% YoY), EBITDA margin 25.9% (vs. 20.4% YoY).
- **Guidance Update**: Narrowed 2025 ASK growth to 9.5-10.5% for Brazil, raised EBITDA to $3.65-3.85B, and free cash flow >$1.3B.

**【Q&A Highlights】**
- **Growth Outlook**: 2026 ASK growth ~7-8% based on fleet plan, with premium revenue outpacing capacity.
- **Capital Allocation**: Target leverage <1.5x, with flexibility to return capital via dividends or buybacks.
- **Seasonality**: Reduced second-quarter seasonality due to premium revenue diversification and network balance.
- **Technology Impact**: AI and digital tools driving operational efficiency improvements beyond hardware upgrades.

LATAM Airlines Group SA ADR (LTM) Q2 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

LTM

LTM fundamentals

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