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International Airlines Group (IAG Loyalty) · IAG (LSE, BME) · FY2025

British Airways Club by the numbers

IAG is the only large airline group that runs its loyalty business as a stand-alone company with its own investor day, and the numbers explain why: £469 million of operating profit in 2025 on a margin near 19%, heading for €1 billion.

Written and reviewed by the Points Plug team. Last reviewed .

What International Airlines Group (IAG Loyalty) reports

Loyalty revenue
200 billion Avios issued
IAG Loyalty's revenue is not in the pages read. Avios issued rose 13.1% to 200 billion in 2025; revenue mix is 67% IAG airlines, 14% financial services, 19% retail and travel.
Members
10.6 million active
Active customers at the June 2026 investor day, up 10%, out of more than 46 million enrolled.
Loyalty segment profit
£469 million
IAG Loyalty operating profit 2025 (€548m), up £49m; up 20.5% before a VAT accounting change. Margin about 19%; the investor day slide shows £507m on its own basis.

Card partners and deals

  • American Express and JPMorgan Chase both extended their agreements in 2025, IAG's two largest non-airline partnerships.
  • 17 co-brand partners in total; IAG Loyalty holds more than 15% of the UK co-brand card market and targets over 20%.
  • Mid-term target: €1 billion of operating profit at an 18% or better margin.

Financing: None secured on the program. IAG has paid €507 million to HMRC, held as an asset pending a VAT tribunal in late 2026.

How the miles are accounted for

  • "Partners pay IAG Loyalty upfront for issuing Avios… most revenue is only recognized upon customer redemption, not issuance."
  • Financial-services partners earn a 25% to 35% operating margin, retail partners 5% to 10%, and the airlines' own use of Avios roughly breaks even.
  • Capital spending is under £50 million a year and free cash flow exceeds operating profit, because cash arrives at issuance and cost at redemption.

What it means

The economics IAG laid out in June 2026 are the clearest public statement of how miles make money. Banks pay upfront for Avios at a 25% to 35% margin, retailers at 5% to 10%, the airlines themselves at about breakeven; capex is under £50 million; and revenue is booked at redemption, so the cash always arrives first.

IAG Loyalty issued 200 billion Avios in 2025, 13% more than the year before, to 10.6 million active members across British Airways, Iberia, Aer Lingus and the wider Avios partners. It renewed both American Express and Chase in 2025 and wants a fifth of the UK co-brand market.

For members, the volume matters: Avios are being issued faster than flown, and BA moved to spend-based earning and the Club branding in 2025 to shape who gets them. The group's overall operating profit was €5.0 billion, so loyalty is about a tenth of it and growing faster.

What it means for your British Airways Club balance

A program that earns more from selling miles to banks than from flights has an incentive to keep issuing them, and the deferred revenue line is the airline's own estimate of what an average outstanding mile will cost it to honour. Compare that with published valuations and with what Points Plug pays to see where your balance stands.

British Airways Club finances: FAQ

How profitable is IAG Loyalty?
£469 million (€548 million) of operating profit in 2025, up £49 million, at a margin of about 19%, with a mid-term target of €1 billion.
How many Avios were issued in 2025?
200 billion, up 13.1%, to 10.6 million active members.
Who are IAG Loyalty's card partners?
American Express and JPMorgan Chase are the two largest and both renewed in 2025; there are 17 co-brand partners in all.

Sources

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