EasyJet Profits Plummet Amid Higher Fuel Costs and Geopolitical Uncertainty
The airline reported a 70% drop in quarterly profits, impacted by increased fuel expenses and a downturn in consumer confidence.
EasyJet's profits have significantly decreased, with the airline posting an £85 million profit for the three months ending June 30, a 70% drop from the £286 million reported in the same period a year prior. This decline is attributed to higher fuel prices and weakened consumer confidence, exacerbated by the ongoing conflict in the Middle East.
The budget airline's revenue increased by 2% to £2.98 billion. However, fuel costs surged by 17% to £732 million, with unhedged fuel expenses peaking around $1,800 per metric tonne in April. Revenue per available seat kilometre fell by 3%, and passenger numbers remained largely stagnant at 25.8 million, despite a 1% increase in seat capacity. The group's load factor decreased by 1.3 percentage points to 88.9%.
Despite these challenges, EasyJet's holidays division showed resilience, with profit before tax experiencing only a 2% slip to £84 million, as customer numbers grew by 8%. Excluding currency fluctuations, this division's profit saw a 7% increase.
In a turbulent week for the company, EasyJet's shares initially plunged by nearly 12% following reports that the European Union might review ownership rules to curb foreign investor control. The airline is currently the subject of a £5.7 billion takeover bid from U.S. private equity firm Apollo, after an earlier £5.5 billion offer from another U.S. suitor, Castlelake. Shares rallied 5% on the morning of July 23, 2026, after the company reported strong late-booking demand for the upcoming peak summer period, having sold 68% of its capacity for the current quarter.
Chief Executive Kenton Jarvis noted a trend of passengers booking further in advance, stating, "As consumer confidence increases, we are seeing the load factor gap close for peak summer and an extension of the booking curve as customers continue to prioritise travel and take advantage of our great fares." However, this late-booking trend did not fully offset weaker booking patterns that emerged after the conflict in the Middle East began.
EasyJet's annual outlook remains contingent on late summer bookings and fuel price volatility. Jarvis acknowledged the company's efforts to manage the impact of the Middle East conflict on fuel prices and booking trends.
Rival airline Ryanair recently indicated it had to lower ticket prices for the summer due to a slump in demand. Heathrow Airport also reported a softening of travel demand to the Middle East, though demand remained strong for North America and the Asia-Pacific region. Heathrow recorded a record 40 million passengers in the first half of the year.