MANILA (Bloomberg): Flag carrier PT Garuda Indonesia posted a wider net loss last year as revenue from scheduled airline services weakened and costs in some areas rose.
The net loss widened to $323 million from $72.7 million the previous year, according to its financial report. Revenue fell by 5.9% to $3.22 billion.
The drop in scheduled airline revenue came as funding constraints left nearly 40% of its fleet grounded for maintenance, limiting flight operations. Maintenance and repair costs jumped 23% and the company recorded a foreign-exchange loss.
That leaves Garuda in a fragile position just as airlines globally are bracing for higher fuel bills linked to the war in Iran. Rising jet fuel prices are already pushing carriers to adjust fares and capacity, adding pressure on earnings.
For Garuda, which is still reporting losses despite last year’s $1.4 billion capital injection from Indonesia’s sovereign wealth fund Danantara, the added costs could slow its turnaround and raise questions about the strength of its balance sheet.
"The current market environment will put Garuda in a very difficult position financially,” said Shukor Yusof, founder of aviation consultancy Endau Analytics Pte. "The $1.4 billion financial support from Danantara will burn very fast at the current jet fuel prices.”
Shukor said with the conflict potentially disrupting pilgrimage trips to Saudi Arabia and lucrative longer-haul business trips, it will be hard for Garuda to stabilize its balance sheet and manage rising operating costs.
The support from Danantara helped the company to post positive shareholder equity in 2025 for the first time in six years.
Any recovery by Garuda carries broader economic implications for Indonesia, Southeast Asia’s largest economy. The 77-year-old carrier remains a critical link across an archipelago of more than 17,000 islands and is expected to play a role in trade ties with the US through planned aircraft purchases.
-- ©2026 Bloomberg L.P.
