Wizz Air reported a larger-than-expected decline in first-half net profit on Thursday, primarily due to ongoing issues with engine inspections that grounded its Airbus fleet and the impact of the Middle East conflict. The airline, which operates an entirely Airbus fleet, has faced disruptions linked to Pratt & Whitney in
RTX engines grounded planes for inspections and limited capacity.
Despite these challenges, Wizz Air anticipates continued cost pressures from the GTF engines in the second half of the year, though these will be partially offset by improved operational efficiency and a new compensation agreement with Pratt & Whitney, according to CEO Jozsef Varadi.
“Bookings since the period’s end show no signs of weakening demand, and we expect positive momentum in both bookings and yield in the second half,” Varadi said in a statement.
The airline’s shares fell 3.1% by 0804 GMT.
For the six months ending September 30, Wizz Air reported a net profit of 315.2 million euros ($339.16 million), missing analysts’ expectations of 332 million euros, based on a company consensus.
In light of the ongoing geopolitical tensions in the Middle East, Wizz Air has suspended flights to and from Tel Aviv until January 14 but plans to redirect capacity to other markets. The airline expects minimal disruption over the Christmas period, according to Varadi’s comments to Reuters.
JP Morgan analyst Harry J. Gowers noted that Wizz Air is shifting its focus toward its core markets, prioritizing density over expanding into new markets, which should help improve yields.
Wizz Air’s results align with those of other European carriers, including Air France-KLM and Ryanair, which have faced squeezed profit margins due to high costs, weak demand, and growing competition.
