yield |yēld|
Verb:
• (of a financial or commercial process or transaction) generate (a specified financial return) : such investments yield direct cash returns.
Noun:
• Finance the amount of money brought in, e.g., interest from an investment or revenue from a tax; return : an annual dividend yield of 20 percent.
Or put simply, how much money you earn. In the case of an airline, it is the net money earned by the airline for providing a service. It can be expressed in whatever terms you like, e.g. the total yield for the 0800 departure to Malaga was £3,250, or the average yield per passenger is £87.24 each way etc ...
It can also be expressed as seat miles but this is more useful to compare the yield between different sector lengths, which take into account the duration of the flight. SO for example, let's think about LPL-BFS compared to LPL-AGP. LPL-BFS will have a lower fare (on average) than LPL-AGP, however it is conceivable that the yield per seat mile is higher, because the sector is so short. Sometimes, the sector is too short and there are not enough market factors to enable you to push the price up, and so the yield is very low. This is common on UK domestic routes such as LPL-LON, where you compete with the train and don't really have a time advantage when all things are considered. BUt why, LPL-BFS works as you have water in the middle ...
When airlines think about their profitability and what routes to keep, they consider load factors but really it is the yield from the flight that matters, and often why loads are not a good indicator. For example, if the LPL-BFS flight only has a load of 25% but everyone is paying £300 each way for the ticket, you'll fly it till the cows come home ....
You would expect the yield to be net of taxes and charges and represent the income which the airline can account for.