Austrian Airlines suffered significant financial losses in the first half of 2026. The adjusted operating result (Adjusted EBIT) deteriorated by €50 million compared to the same period last year, reaching a loss of €93 million.
The company cites the escalation of the crisis in the Middle East as the primary cause. Ongoing military conflicts and the resulting shortage of crude oil led to fuel-related additional costs of over €60 million compared to the first half of 2025, despite existing hedging contracts. Furthermore, suspensions of flights to the region due to military action and security concerns resulted in revenue losses in the tens of millions. The airline is responding to this decline in earnings by streamlining its winter flight schedule, discontinuing unprofitable domestic routes, and increasing efficiency in its administrative sector, but remains committed to its planned investments in fleet renewal.
Financial pressure and operational adjustments
Despite a four percent increase in revenue from €1,12 billion to €1,22 billion in the first half of 2026, exogenous cost drivers led to a negative half-year result. Seat kilometers remained at the previous year's level of 13,53 billion, while the reliability of flight operations remained largely stable with a fulfillment rate of 98,8 percent.
CEO Annette Mann pointed out that the drastically increased kerosene costs and the loss of high-margin routes in the Middle East could only be partially offset by the ticket price increase until the beginning of summer. To limit the financial losses, management initiated adjustments to the project portfolio and implemented administrative cost savings. Recruitment of personnel continues in core operational areas such as flight operations, aircraft maintenance, and ground handling to ensure operational reliability.
As a consequence of the changed cost situation, the airline is making structural adjustments to its route network. The domestic connection between Vienna and Graz, which has been operating at a loss for years, will be discontinued with the upcoming winter flight schedule. However, Graz will remain connected to the international air network via several daily flights operated by its parent company, Lufthansa, to the hubs in Frankfurt, Munich, and Zurich, as well as via existing rail connections. Additionally, flight connections to Tbilisi, Keflavik, and Porto will be temporarily suspended. To avoid overnight accommodation costs, the airline will also eliminate overnight bases for aircraft and crews in Klagenfurt, Copenhagen, Warsaw, and Krakow.
Demand trends and summer season
Despite the financial challenges, the airline recorded solid passenger numbers for the summer months. After initial customer reluctance at the beginning of the year, increased demand for last-minute bookings began in the second quarter. Passenger numbers climbed by six percent in the first half of 2026 to approximately 6,96 million travelers. Average aircraft occupancy improved from 77,2 percent to 80,6 percent during the same period.
The capacity freed up by the suspension of routes to Amman, Erbil, Tel Aviv, and Tehran was quickly reallocated to European holiday destinations. The summer flight schedule offered approximately 800 additional flights to destinations such as Palma de Mallorca, Barcelona, Dubrovnik, Nice, and Málaga. Furthermore, seven new destinations were added to the route network, including Ponta Delgada in the Azores, Ohrid in North Macedonia, Bergen in Norway, as well as Mytilene, Bastia, Bilbao, and Alicante. The airline currently serves over 120 destinations.
Investments in fleet and ground services
Despite the operating loss, the company is continuing its long-term fleet modernization. Austrian Airlines expects delivery of two more Boeing 787-9 long-haul aircraft during 2026, bringing the total number of this type in service to five. For short- and medium-haul routes, the delivery of a brand-new Airbus A320neo is planned for autumn; this will be the first aircraft in the fleet equipped with a Starlink satellite internet connection. The gradual rollout of this technology across the entire fleet is planned for the coming years.
At the same time, the phasing out of the previously used Embraer aircraft is progressing; four of the original 17 aircraft have already been retired this year. By 2029, the fleet is to be structurally standardized and will consist exclusively of Airbus A320 family and Boeing 787 aircraft. Chief Operating Officer Stefan-Kenan Scheib emphasized that this type consolidation will lead to efficiency gains in maintenance and flight planning.
Beyond the aircraft renewal, investments are also being made in ground facilities. At Vienna Airport, new lounge areas with a total area of over 5.000 square meters are being built as part of the terminal expansion, with an opening planned for the second quarter of 2027. In addition, the airline is preparing to revamp its Premium Economy Class and is currently conducting field tests for a redesign of its staff uniforms, which are scheduled to be introduced in 2028.
Location policy and outlook for the year as a whole
Against the backdrop of geopolitical turmoil, Austrian Airlines' management is once again calling for an adjustment of national operating conditions. In particular, a reduction in government taxes and fees is cited as a necessity to maintain international competitiveness against foreign locations. The company's management is currently in negotiations with the relevant political authorities regarding a long-term aviation strategy.
For the remainder of the second half of the year, the airline is relying on the passed-on price adjustment in ticket sales and the effective cost-cutting measures. Management remains committed to its goal of achieving a positive operating result and profitability for the full year 2026, despite the negative half-year result.