• Home
  • Latest
  • Fortune 500
  • Finance
  • Tech
  • Leadership
  • Lifestyle
  • Rankings
  • Multimedia

Trendingnow

1

As Big Tech showers employees with perks to win the talent war, Nvidia built a nearly $5 trillion company by making people pay for their own lunch

2

MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year

3

The Supreme Court's birthright citizenship ruling hands the U.S. economy a $7.7 trillion win

1

As Big Tech showers employees with perks to win the talent war, Nvidia built a nearly $5 trillion company by making people pay for their own lunch

2

MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year

3

The Supreme Court's birthright citizenship ruling hands the U.S. economy a $7.7 trillion win
Airline industry

Airline profits are soaring — but it’s not good news for consumers

By
Christopher Elliott
Christopher Elliott
Down Arrow Button Icon
By
Christopher Elliott
Christopher Elliott
Down Arrow Button Icon
June 9, 2015, 11:50 AM ET
Emirates Launches Daily A380 Flights From Dubai To Munich
MUNICH, GERMANY - NOVEMBER 25: The flight deck of the Emirates Airbus A380 registration A6-EDPis pictured at Munich Airport Franz Joseph Strauss on November 25, 2011 in Munich, Germany. Emirates Airlines has launched a new daily A380 service from Dubai to Munich with its first flight today. (Photo by Alexander Hassenstein/Getty Images)Photograph by Alexander Hassenstein — Getty Images
Add Fortune on Google for similar content.

The International Air Transport Association (IATA) made a little oopsie when it predicted airlines would make $25 billion worldwide in 2015. Too low. Not to worry — IATA fixed that earlier this week, when it revised its industry profit estimate to $29 billion.

And that’s good news, right? Maybe not.

More than half the global profit ($15.7 billion) is expected to be generated by airlines based in North America, according to IATA. In other words, our airlines are in da money. But a comparison of the industry’s annual income to its latest customer service scores suggests higher profits may affect customer satisfaction. Or, to be blunt, the more an airline earns, the less it cares about service.

The two most profitable airlines — American Airlines and United Airlines — have abysmal customer service satisfaction scores, as you can see from the chart.

That may seem counterintuitive, and it’s important to note some exceptions to this rule. But a side-by-side examination of the latest American Customer Service Index (ACSI) and the earnings of the major airlines, as measured by net income and operating margin, point to some noteworthy patterns.

“Passengers often assume that improving airline customer satisfaction and financial performance go hand in hand,” says Kendall Creighton, a spokeswoman for FlyersRights.org, an organization that advocates for air travelers. “They assume that satisfied customers are good for business.”

But in many cases, she notes, an airline’s customer satisfaction levels appear to be inversely related to profits. The higher the profits, the worse the scores. The more modest the profits, the higher the customer satisfaction.

 

 

To get a more nuanced look at airline income, you could also examine a carrier’s operating margins. A company’s operating margin, for those of you who slept during economics class, measures a company’s profit, for each dollar in revenue it collects, after paying for the variable costs of production, like pilot salaries and fuel.

When comparing service scores to margins, there are also a few interesting trends.

“The highest rated airline, JetBlue, with a customer service score of 81, had an operating margin of 9 percent,” says Kevin Mitchell, whose Business Travel Coalition advocates for corporate travelers. “The lowest rated, Spirit, with a score of 54, had an operating margin of 19 percent.”

So what does that mean?

“For these two airlines, there is an inverse relationship between operating margins and customer satisfaction, suggesting that healthier margins for Spirit do not translate into happier customers,” he says.

Of course, there are notable exceptions. Airlines like Alaska, Delta and Southwest have managed to strike a balance between profits and happy passengers. “The key for customers is what the airline does with the profits,” says Seth Kaplan, editor of Airline Weekly. “Delta has gotten itself into a virtuous cycle of earning good profits, some of which is reinvested into its product and into technology that has enabled it to run a very reliable airline with very impressive on-time stats and very few lost bags,” he says. “Customers have rewarded it by – Delta says, and this seems to be true – being willing to pay a bit more to fly Delta than to fly its less reliable competitors.”

Like the airline industry itself, the real profit vs. service picture is a little bit more complicated that a chart might suggest. If there are any conclusions that can be drawn from comparing an airline’s profits and service scores, it’s that extremes can be bad for customers, whether it’s excessive profits, or in years past, deep losses.

But it’s no stretch to say this: Just because the airline you’re flying is making more money doesn’t mean you’ll have a better flight. In many cases, you should expect the exact opposite.

 

 

About the Author
By Christopher Elliott
See full bioRight Arrow Button Icon
Add Fortune on Google for similar content.

Latest in

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025

Most Popular

Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Finance
Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam
By Fortune Editors
October 20, 2025
Fortune Secondary Logo
Rankings
  • 100 Best Companies
  • Fortune 500
  • Global 500
  • Fortune 500 Europe
  • Most Powerful Women
  • World's Most Admired Companies
  • See All Rankings
  • Lists Calendar
Sections
  • Finance
  • Fortune Crypto
  • Features
  • Leadership
  • Health
  • Commentary
  • Success
  • Retail
  • Mpw
  • Tech
  • Lifestyle
  • CEO Initiative
  • Asia
  • Politics
  • Conferences
  • Europe
  • Newsletters
  • Personal Finance
  • Environment
  • Magazine
  • Education
Customer Support
  • Frequently Asked Questions
  • Customer Service Portal
  • Privacy Policy
  • Terms Of Use
  • Single Issues For Purchase
  • International Print
Commercial Services
  • Advertising
  • Fortune Brand Studio
  • Fortune Analytics
  • Fortune Conferences
  • Business Development
  • Group Subscriptions
About Us
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • About Us
  • Press Center
  • Work At Fortune
  • Terms And Conditions
  • Site Map
  • Facebook icon
  • Twitter icon
  • LinkedIn icon
  • Instagram icon
  • Pinterest icon

Latest in

Trump’s 927-page disclosure is just a normal Tuesday for direct indexing and crypto wealth managers
InvestingDonald Trump
Trump’s 927-page disclosure is just a normal Tuesday for direct indexing and crypto wealth managers
By Catherina GioinoJuly 1, 2026
4 hours ago
US President Donald Trump sits in silence with his hands folded on top of each other.
CryptoDonald Trump
Inside Trump’s $1.4 billion crypto empire: Altcoins, Bitcoin—and a stake in Michael Saylor’s Strategy
By Camila Grigera NaónJuly 1, 2026
5 hours ago
The 6 Best Exercise Bikes of 2026: Fitness Expert Reviewed
HealthDietary Supplements
The 6 Best Exercise Bikes of 2026: Fitness Expert Reviewed
By Christina SnyderJuly 1, 2026
6 hours ago
Mark Zandi, Moody's chief economist.
EconomyU.S. economy
‘It’s fair to ask whether it was worth it’: The Iran war has cost Americans $1,000 per household—and that’s a conservative estimate, Mark Zandi says
By Tristan BoveJuly 1, 2026
8 hours ago
Melania Trump NFT earnings surge 28x in 2025 as first lady rakes in nearly $17 million in total earnings, filing shows
PoliticsDonald Trump
Melania Trump NFT earnings surge 28x in 2025 as first lady rakes in nearly $17 million in total earnings, filing shows
By Mia OsmonbekovJuly 1, 2026
9 hours ago
Donald Trump sits at his desk in the Oval Office, smiling and with his hands folded in front of him.
PoliticsDonald Trump
Trump got a $78K pension from the Screen Actors Guild in 2025 because he appeared in Home Alone 2 in 1992
By Sasha RogelbergJuly 1, 2026
10 hours ago

Most Popular

As Big Tech showers employees with perks to win the talent war, Nvidia built a nearly $5 trillion company by making people pay for their own lunch
Big Tech
As Big Tech showers employees with perks to win the talent war, Nvidia built a nearly $5 trillion company by making people pay for their own lunch
By Marco Quiroz-GutierrezJuly 1, 2026
20 hours ago
MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year
Success
MacKenzie Scott alone accounted for one-third of America's $19.2 billion in megagifts last year
By Sydney LakeJune 25, 2026
7 days ago
The Supreme Court's birthright citizenship ruling hands the U.S. economy a $7.7 trillion win
Newsletters
The Supreme Court's birthright citizenship ruling hands the U.S. economy a $7.7 trillion win
By Diane BradyJuly 1, 2026
18 hours ago
Philanthropy leader at Warren Buffett and Bill Gates’ Giving Pledge says children of billionaires are pushing them to give their wealth away faster
Success
Philanthropy leader at Warren Buffett and Bill Gates’ Giving Pledge says children of billionaires are pushing them to give their wealth away faster
By Preston ForeJune 27, 2026
5 days ago
Elon Musk on MacKenzie Scott giving away $26 billion of her fortune: 'Sadly,' it makes the world a worse place
Success
Elon Musk on MacKenzie Scott giving away $26 billion of her fortune: 'Sadly,' it makes the world a worse place
By Sydney LakeJune 29, 2026
2 days ago
Current price of oil as of July 1, 2026
Personal Finance
Current price of oil as of July 1, 2026
By Joseph HostetlerJuly 1, 2026
14 hours ago

© 2026 Fortune Media IP Limited. All Rights Reserved. Use of this site constitutes acceptance of our Terms of Use and Privacy Policy | CA Notice at Collection and Privacy Notice | Do Not Sell/Share My Personal Information
FORTUNE is a trademark of Fortune Media IP Limited, registered in the U.S. and other countries. FORTUNE may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.