Global airline profits expected to halve in 2026

The International Air Transport Association (IATA) projects that global airline industry net profits will fall to $23 billion in 2026, down from $45 billion in 2025. This decline is attributed primarily to a 70% increase in jet fuel prices and ongoing geopolitical instability, specifically the conflict in the Middle East and the war in Ukraine. Director General Willie Walsh noted that these rising fuel costs will add approximately $100 billion to the industry's collective expenses. Additionally, the sector is struggling with aerospace supply chain failures and shifts in global trade policies. Net profit margins are forecasted to narrow to 2%, a significant drop from 4.2% last year, while net profit per passenger is expected to reach only $4.50 compared to $9.10 in 2025. Despite these pressures, passenger demand remains resilient, though traffic growth is expected to slow to 2.1% and cargo growth to 0.7%. Airlines with weaker balance sheets are identified as being at the highest risk during this period of restricted profitability.