Bookings for the third and fourth quarters are down compared with a year ago, with the CEO saying bookings for summer are currently slightly behind the previous year / Photo: easyJet
Shares of UK low-cost carrier EasyJet plunged nearly 9% in early trading in London on Thursday after the company said that, despite strong demand, its financial performance had worsened in the first half of fiscal 2026. The deterioration was driven by the conflict in the Middle East and the resulting rise in fuel prices.
Details
EasyJet shares fell 8.7% in early trading on the London Stock Exchange to GBP357.00 apiece. This marked the steepest intraday drop since June 2022, Bloomberg reported. The decline later eased, however.
The stock fell after the company warned that its pretax loss for the first half of fiscal 2026, ended March 31, is expected to total GBP540-560 million ($731-758 million at current exchange rates), versus GBP394 million ($533.9 million) in the same period a year earlier.
Financial performance worsened year over year in part due to the conflict in the Middle East, CEO Kenton Jarvis said. As a result, the company incurred an additional GBP25 million ($33.8 million) in fuel costs in March, the statement said.
Outlook
The war in Iran has also reduced visibility on future performance due to a shortening of the booking curve in recent weeks of the reporting period, EasyJet said. The booking curve is a tool airlines use to manage sales: if bookings outpace forecasts, carriers raise prices, and vice versa.
“As with previous conflicts, we’ve seen reduced demand for a number of weeks, meaning bookings for summer are currently slightly behind the previous year,” Jarvis said during a call with journalists, according to Bloomberg.
Bloomberg reported that as airlines approach the peak summer travel season, concerns about fuel shortages are rising. Some carriers have warned of potential supply constraints if the conflict drags on.
EasyJet said in its statement that it is 70% hedged for fuel for the second half of fiscal 2026 at $706 per metric ton (with the current spot price at $1,500 as of April 15). Every $100 movement in fuel prices equates to approximately GBP40 million ($54 million) in costs in the second half of fiscal 2026, the company said.
Stock performance
Since the start of the year, EasyJet shares have fallen more than 27%. Wall Street remains cautious on the stock’s prospects: analysts have eight “buy” ratings on the shares versus seven “hold” and three “sell” calls.
