 has warned that global airline profits will fall sharply in 2026.){kind=link}
Airline Profits to Halve in 2026, IATA Reveals
The International Air Transport Association (IATA) has warned that global airline profits will fall sharply in 2026, driven by war-related disruptions in the Middle East and a 70% surge in jet fuel prices.
IATA projects combined net profits of $23bn in 2026, down from $45bn in 2025, and well below earlier forecasts of $41bn. Net margins are expected to shrink from 4.2% to 2.0%.
Director General Willie Walsh said “War-related disruptions in the Middle East and rising fuel costs have shifted the outlook for airlines to the worst. Globally, profits will shrink from $45bn in 2025 to $23bn this year.”
He added that Middle East carriers face losses due to airspace shutdowns and weak demand, while other regions remain profitable but at reduced levels. Smaller airlines with weak balance sheets are struggling most.
IATA noted that net profit per passenger will fall to $4.50 in 2026, half of the $9.10 recorded in 2025. Walsh quipped: “That won’t even buy you a hot dog at most FIFA World Cup venues.”
Operating profit is expected to decline to $48bn in 2026 from $76.4bn in 2025, while return on invested capital will drop to 4.3%, far below the 8.5% weighted average cost of capital.
The association stressed that airlines are absorbing part of the fuel price shock despite raising fares, underscoring the industry’s structural challenge of low margins and capital inefficiency.
IATA concluded that while airlines are showing resilience, profitability shocks like the current oil price surge highlight the fragility of the sector and its limited buffer against rising costs and taxes.