EasyJet announced a significant 70% decrease in profit for the first half of its fiscal year, down to $104 million. This decline is largely attributed to escalating fuel expenses and a noticeable reduction in passenger demand, particularly stemming from geopolitical uncertainties in the Middle East. The airline had previously indicated that the conflict would exert downward pressure on its financial performance for fiscal year 2026.
Despite the profit dip, EasyJet's stock experienced a modest increase of 1.7% at 0822 GMT. This slight uptick suggests that analysts and investors found stability in the company's financial report, with few unexpected revelations. The airline's half-year report also showed a net cash position of $434 million as of March 1, 2026, with substantial liquidity access totaling $4.7 billion.
Looking ahead, EasyJet has adjusted its capacity, shifting focus towards domestic and city routes to counter weakened demand for longer-haul destinations, especially in the Eastern Mediterranean. The company projects a disciplined seat capacity growth of 3% for fiscal year 2026. While H2 FY26 headline CASK (Cost per Available Seat Kilometer) excluding fuel is expected to rise by low single digits, fuel CASK remains uncertain due to price volatility. The airline is 72% hedged at $726/MT, with every $100/MT price movement equating to approximately $12.3 million impact.
EasyJet also reported that while overall summer bookings have been impacted, there has been an encouraging trend of positive late bookings since the Middle East conflict began. Second-half bookings were 58% sold, reflecting a continued consumer shift towards booking closer to departure and opting for nearer destinations. The airline also plans to launch a loyalty program in 2027 to enhance customer retention.
