Etihad Airways anticipates breaking even in 2026, a turnaround from its earlier forecast of a potential annual loss. The Abu Dhabi-based airline is operating at 90% capacity and is generating positive cash flow, boosted by a thriving air cargo business. This performance comes despite the ongoing Iran war, which has disrupted regional air travel and led to higher jet fuel prices. The airline recorded a profit in August and maintained airfares at last year's levels, even as jet fuel costs increased, and it added 15% capacity year-on-year in July.
Despite the challenges, Etihad's CEO Antonoaldo Neves stated that the airline is currently only 1-2% behind its budget for the year, achieving 15% growth in Available Seat Kilometres (ASKs) against a target of 18%. The airline plans to expand its daily flights by 25%, from 320 to approximately 400, by the end of 2027, with growth particularly expected in China and Africa. Etihad had a record after-tax profit of $707.9 million in 2025, up 47% from 2024.
The biggest concern for Etihad is the rising cost of jet fuel, which represents about $2 billion of its annual expenses. Neves noted that while demand remains very strong, with flights consistently full and a load factor of 92% last month, fierce competition among Middle Eastern carriers prevents the airline from easily passing on higher fuel costs to passengers. This regional rivalry effectively shields passengers from fare increases, making the outlook for average fares next year a key risk if fuel prices remain elevated. However, Neves highlighted Etihad's strong balance sheet and cash generation capabilities, allowing it to absorb these costs without resorting to pre-2019 cost-cutting measures.
