EasyJet profit hit by fuel and weak bookings

Passenger jet on cloudy airport tarmac as rising fuel costs and weak bookings hit airline profits

Key Points

01EasyJet (EZJ.L)’s fiscal Q3 pre-tax profit fell to £85m, down about 70% year on year
02Fuel costs rose by £105m in the quarter amid Middle East conflict impacts
03Revenue still inched up 2% to £2.98bn as easyJet (EZJ.L) flew 25.8m passengers
04Outlook hinges on late bookings and volatile fuel prices, with yields flat

Profit slump in the third quarter

EasyJet (EZJ.L) reported pre-tax profit of £85 million for its fiscal third quarter, covering the quarter ending in June, a steep fall from £286 million in the same period a year earlier. The decline represents a drop of about 70% in quarterly profit before tax. Despite the setback, the reported profit was slightly above market estimates of around £80 million.

The airline said that, while profits shrank, it continued to grow overall revenue in the period. Group revenue rose 2% to £2.98 billion in the quarter, supported by continued passenger volumes across its network.

Fuel cost surge and Middle East conflict impact

A sharp increase in fuel expenses was a key factor behind the weaker profitability. EasyJet’s fuel bill for the quarter rose by £105 million year on year, as energy prices climbed following conflict in the Middle East. The airline highlighted that fuel prices for the final quarter remain uncertain because of ongoing price volatility.

This fuel cost pressure eroded margins even as the company maintained operations at scale. Management indicated that volatility in fuel markets continues to be a significant variable for results in the remainder of the financial year.

Passenger volumes and changing booking patterns

Operationally, easyJet carried about 25.8 million passengers during the fiscal third quarter. However, the airline’s load factor was lower than in the same period a year earlier, indicating a reduced proportion of seats filled on flights.

The company reported that customers have been booking flights closer to their departure dates, shifting traditional booking patterns. To stimulate demand under these conditions, easyJet has been using lower fares on some routes, contributing to pressure on yields and profitability despite steady passenger numbers.

Outlook dependent on bookings and fuel prices

Looking ahead, easyJet described the remainder of its financial year as dependent on “important remaining bookings” and on fuel prices, which it said continue to be volatile. The airline noted that booked fourth-quarter ticket yield is currently flat, underscoring the sensitivity of earnings to late booking behavior and pricing.

Forward bookings remain an important driver of the full-year outcome as the carrier heads into the peak summer season. While profit fell sharply in the third quarter, easyJet shares rose in early London trading following the update, suggesting investors are weighing the earnings pressure against continued revenue growth and passenger volumes.

Key Takeaways

01EasyJet’s profitability has been squeezed primarily by a sharp rise in fuel costs, even as overall revenue and passenger numbers grew modestly.
02Shifts in customer behaviour toward later bookings are forcing the airline to rely on lower fares, pressuring yields and load factors.
03The company’s full-year results are now closely tied to late summer bookings and the path of fuel prices, with limited pricing momentum indicated by flat booked yields.

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