In the age of AI, why Canadian travel agencies just saw revenues rise

Despite the convenience of artificial intelligence and the internet for comparing travel options, many Canadians are still opting for traditional travel agencies. Statistics Canada reported that the industry's operating revenue reached $18.3 billion in 2025, marking an 8.8% increase from the previous year. This growth trend continued into 2024, with a 9.3% increase.

Even as Canadian travel to the U.S. plummeted by 25.4% compared to 2024, the travel agency sector continued to thrive. Suzanne Acton-Gervais, president of the Association of Canadian Travel Agencies and Travel Advisors, emphasized that while AI tools can assist with flight and hotel comparisons, they lack the human touch that travel agencies provide. "A great travel agency and travel advisor knows which questions to ask first," she stated, underscoring the value of human judgment in the planning process.

Booking airline seats accounts for 35% of travel agencies' revenue, while packaged tours make up another 25.2%. Acton-Gervais noted that the desire for curated, seamless, and personalized travel experiences is a significant driver of this sector's success. Younger customers, though initially tech-savvy, often seek the expertise and personalization that human advisors offer, even after using AI for initial research.

However, the industry faces challenges due to declining U.S. travel. With 60% of travel agencies' revenue previously coming from U.S. trips, the decline has impacted their growth. The sector's expansion could be hampered in 2026, but non-U.S. travel is expected to provide opportunities. January-June 2026 saw a 4.6% drop in return trips from the U.S., but a 4.8% increase in trips from other countries.