Background: Qantas was founded in 1920 and today operates Australia’s largest airline group across the Qantas and Jetstar brands. Between the two, it controls roughly two-thirds of the domestic market, making it the dominant player in Australian aviation.

What happened: Now, Qantas has reported an underlying profit rise of $71 million to $1.46 billion. But the real standout was its Loyalty division, with profit jumping 12% to $286 million.

What else: At the same time, Qantas unveiled changes to its Frequent Flyer program. It will become easier to earn status credits without flying, but passengers will need more points to retain higher tiers. The clear aim is to keep customers loyal to the Q and away from competitors.

What's the key learning?

💡While many people see airline loyalty programs as a nice bonus, they are often one of the most profitable parts of the business. Qantas has more than 18 million Frequent Flyer members, giving it a huge base to monetise beyond just ticket sales.

💡Airlines sell points in bulk to banks and credit card providers. That means when customers earn points on everyday spending, the bank has already paid Qantas upfront, delivering immediate revenue and strong cash flow. Not every point is redeemed, and when they are, they often fill seats that would have flown empty. That keeps the marginal cost low relative to the revenue earned when the points were first sold.

💡It is why Qantas expects Loyalty EBIT to reach up to $1 billion by 2030 and why investors view it as a core profit engine, not just a marketing perk.