The net loss fell to €40 million (US$46.6 million), largely thanks to increased passengers on flights to North and South America, after a loss of €108 million in the same quarter last year.

Total passenger growth was 6.4% year on year to 3.7 million.

“This performance reflects a clear focus on delivering our strategy, with the South and North American markets continuing to play a key role in driving the increase in operations and revenues, translating into a meaningful improvement in operating results,” chief executive Luis Rodrigues said in a statement.

But TAP expects higher fuel costs in the coming months due to the Middle East war, “and we remain focused on mitigating this through disciplined capacity allocation, rigorous cost management and active revenue management”, he said.

The Portuguese government is weighing two bids for nearly half of its stake in the state-owned airline, one from Air France-KLM and another from Lufthansa, both lodged in April.

It expects to announce its decision around the end of the summer travel season.