The International Air Transport Association (IATA) has projected in its annual report that global airline net profits for 2026 will reach $23 billion, far below the previous forecast of around $41 billion and significantly lower than the $45 billion expected for 2025.
IATA represents over 370 airlines worldwide, whose member airlines are responsible for around 85% of global air transport operations.
The report shows that although global air passenger demand remains resilient and load factors continue to rise, with total industry revenues expected to exceed $1.1 trillion for the first time, geopolitical shocks and dramatic fuel price volatility are severely eroding airline profitability.
On June 7th, at the 82nd IATA Annual General Meeting and World Air Transport Summit held in Rio de Janeiro, Brazil, IATA Director General Willie Walsh released the latest global airline outlook for 2026.
He stated that the Middle East conflict has led to route disruptions and weaker demand, combined with surging fuel prices, making the outlook for airlines increasingly bleak.
He also pointed out that in order to maintain profit margins, airlines may cut some loss-making routes in the future. Airfares, which have already risen sharply since the outbreak of the Iran conflict, are unlikely to fall in the short term. Walsh said, “With demand still strong and capacity falling, ticket prices are very likely to remain high.”
Walsh emphasized that soaring fuel prices hit airlines hardest. “Even though carriers have raised ticket prices, they still have to bear part of the increased costs themselves. This level of profitability leaves little buffer. If other costs or taxes rise further, profits will certainly be squeezed even more.”