Earnings of enterprises in the business economy (excluding financial and insurance activities), based on initial tax return submissions, were approximately 518 billion ISK in 2025 which was nearly unchanged from the previous year when businesses earned 520 billion ISK. Low revenue growth and increased financial expenses impacted net income as revenue grew by only 2.1%. 1 This was also lower growth than in 2024 when revenue grew by 3.8%.
Real estate was the most profitable industry (specifically commercial real estate) but income also grew in tourism and fisheries as well as in vehicle sales. 2 On the other hand, net income fell significantly in manufacturing of metals with the industry reporting a loss in 2025 as the local currency strengthened considerably during the year.
In most industries, revenue growth did not hold up with inflation. The consumer price index (CPI) increased by 4.1% in 2025.
It should be noted that these are preliminary figures, which may change as new data becomes available. For instance, in the previous release for 2024, corporate revenue was estimated to have increased by 2.0%, based on data from just over 37,000 business entities. Now, following the receipt of additional data, bringing the total to 39,000 entities for 2024, it is estimated that revenue for that year increased by 3.8%.
The business economy
Revenue for the total business economy (excluding financial and insurance activities) increased by 2.1% or nearly 152 billion ISK. Operating expenses increased slightly less or by 115 billion ISK (1.8%) resulting in an operating profit of 37 billion ISK. Net results from financial items worsened considerably compared with 2024, or by 23.6%, which impacted the bottom line. Thus, net income fell by 0.5% year over year.
Total liabilities increased by 5.7% where both short- and long-term liabilities grew in tandem. Total assets grew by only 3.6% where cash and cash equivalents decreased by 2.0%. Total equity increased by 1.0%.
Low revenue growth in most industries
Revenue growth was minimal in most of the main industries in Iceland in 2025. The greatest increase was in wholesale and retail trade and repairs of motor vehicles, or 25.1% from 256 billion ISK to 321 billion. In fishing, aquaculture and fish processing there was also 14.7% growth, with 15.0% in fisheries. In other areas the revenue growth was lower than inflation. Furthermore, contraction was in the tourism industry, construction, real estate and metals manufacturing.
In the tourism industry revenue declined by 0.8% and amounted to 988 billion ISK. Relatively little growth was in all subsectors of the industry but most notable was 10.2% decrease in passenger transport by air. 3 In accommodation, food and beverages revenue grew by 2.5%, only 0.5% at travel agencies, 4.6% in renting and leasing of motor vehicles and 5.1% in passenger transport by sea and land.
In the technology sector information service activities grew by 32.0% but 10.4% contraction in high and medium-high technology manufacturing (excl. pharmaceutical production) negatively impacted the total revenue for the technology sector which increased by only 0.9%. Lastly, revenue in metals manufacturing decreased by 5.0% due strengthening of the Icelandic krona that far exceeded the rise of global aluminium prices.
Mixed earnings performance
Considerable variance was in the operating results of industries where net income often diverged from the revenue trend as cost items became the dominant factors. Of the main industries two stood out with substantial proportional changes. On the one hand there was significant income growth in wholesale and retail trade and repairs of motor vehicles due to increased revenue. And on the other hand, lower revenue and higher financial expenses coupled with unchanged operating expenses resulted in a loss in manufacture of basic metals.
In the tourism industry earnings improved by 55.1% due to efficiency measures on the cost side. Cost of raw goods and material decreased by 5.6% compared with 0.1% for the total business economy while labour costs increased by 2.6% compared with 4.5% for the whole. Financial items also improved slightly. When looking at specific areas of the tourism industry, however, the results varied. For example, earnings decreased by 49.7% in accommodation due to higher expenses and 8.2% at travel agencies but increased by 62.3% in restaurant activities and 87.7% in renting and leasing of motor vehicles as cost items improved.
The technology sector delivered 8.7 billion ISK in net profit which was 74.1% less than in 2024. Negative earnings in pharmaceutical production of nearly 30 billion ISK was the main culprit but 20 billion ISK profit in other high and medium-high technology manufacturing improved the total picture.
In fishing, aquaculture and fish processing the considerable revenue growth led to higher earnings which grew by 38.7% in 2025. Thereof, fisheries reported nearly 64 billion ISK in profit (55.5% year-over-year growth) but aquaculture lost nearly 15 billion due to higher expenditures (compared with a loss of 6 billion in 2024). In real estate, earnings grew by 13.0%, but the industry is generally the most profitable in Iceland. Earnings in other industries were relatively little changed from a year ago.
Other structural business statistics
Along with publication of new income and balance sheets for industries in the business economy Statistics Iceland now publishes updated statistics on structural business statistics (number of enterprises and operational information). The data consists of specific variables (e.g. turnover, production value, value added, social security costs, and more) for the years 2008-2024 (with preliminary data for 2025) that are comparable to other countries and in accordance with Eurostat standards.
About the data
The income statement and balance sheet are compiled from roughly 38,000 corporate tax returns of companies that have roughly 147 thousand employees in 2025. Figures for 2025 are preliminary and will be updated at the next release.
All numbers are nominal unless otherwise noted. Inflation in 2025 was 4.1% according to the annual average consumer price index.
1 Financial items can include interest expenses and interest income along with gains (losses) on the sale of securities, dividends and mark-to-market changes in security prices. Changes in financial items in few industries can thus significantly impact the results of the total business economy.
2 The real estate industry includes buying/selling of property, commercial and residential leasing, renting of land and land rights, brokerage and property management. Most of the industry’s revenue comes from commercial leasing. Change in assessment values and market prices of properties can significantly influence revenue and profit (loss) of operating entities in the industry.
3 In September of 2025 the airline Fly Play hf. ceased operations. This impacted the operating results and financial situation of the passenger air transport industry and the overall tourism industry.