Japan Airlines (JAL) says it has seen a "remarkable recovery" in bookings from China after a row between the two countries last year hit business.
JAL has cut flight numbers and capacity on some planes
Chinese passenger numbers slumped last summer, after protests about a Japanese textbook's comments on Japan's wartime occupation of much of China.
But strong demand from China has now helped cut losses for the first quarter by 11.5bn yen to 26.7bn yen (£233m).
JAL has tried to overhaul its network, focusing on the most profitable routes.
The change of strategy came after heavy losses forced the exit of chief executive Toshiyuki Shinmachi earlier this year.
In the three months to the end of June, JAL's sales rose 3.7% to $1.6bn.
It managed to trim its losses despite an 11% rise in fuel costs.
"Overall passenger demand on international routes was favourable," the firm said in a statement.
It said demand from China, one of its key markets, had returned to normal after a bitter row between the two countries last April.
Beijing argued that a Japanese textbook played down atrocities committed by Japan's soldiers in China in the 1930s and 1940s.
"Demand on China routes bounced back, making a remarkable recovery from the negative impact that last year's anti-Japanese demonstrations had on travel to China," JAL added.