Airline profits are expected to halve in 2026 due to war-related disruption in the Middle East and high fuel prices, according to IATA’s financial outlook for the global airline industry.
Airlines in the Middle East are expected to fall into the red with weak demand and operational disruptions, while all other regions are expected to deliver profits, but at reduced levels.
Airlines are expected to achieve a combined total nett profit of US$23bn (R380,5bn) in 2026, roughly half the previously projected $41bn (R678,3bn).
Nett profit per passenger is expected to be $4,50 (R75), half the $9,10 (R150) achieved in 2025, while passenger load factors are expected to reach 84%, an improvement on 83,5% in 2025. Passenger numbers are expected to reach 5,1bn in 2026 (up 2,4% on 2025).
“Some of the cost is being recuperated by adjusting prices and improving efficiency, but it will not be sufficient to maintain profitability at the previous year’s level. Smaller carriers that started with weak balance sheets are struggling. The Gulf carriers face operational uncertainty. They are maintaining connectivity, but major financial impacts are unavoidable,” said Willie Walsh, IATA Director General.
Africa
Africa’s hub carriers are seeing the strongest traffic growth but high fuel costs and operational challenges are expected to reduce profitability in 2026.
Nett profit in 2026 is projected to decline to $100m (R1,6bn) from $300m (R4,9bn) in 2025, while profit per passenger is expected to fall to $0,40 (R7) from $2,10 (R35).
Smaller and less connected operators are expected to face the greatest challenges, with growth benefiting hub carriers connecting Africa with Europe and Asia. Weak infrastructure, fragmented airspace, and limited cross-border coordination reduce network efficiency and raise operating costs.
Regional nett profit projections are as follows:
- Asia Pacific: $6,5bn (R107,5bn) in 2026, down from $9,8bn (R162,1bn) in 2025
- Europe: $9,6bn (R158,7bn) in 2026, down from $13bn (R215bn) in 2025
- Latin America: $1,2bn (R19,8bn) in 2026, down from $1,9bn (R31,3bn) in 2025
- Middle East: -$4,3bn (-R70,9bn) in 2026, compared with $7,2bn (R118,8bn) in 2025
- North America: $9,4bn (R155,2bn) in 2026, down from $12,4bn (R204,7bn) in 2025
