easyJet HY1 Losses Deepen as Costs Escalate

UK low-cost airline easyJet expects to report a £540 million to £560 million headline loss before tax for HY1 of its financial year 2026, which ended in March. The guidance, given today in a trading update, is higher than the £394 million headline loss reported in 2025 and is partly driven by higher fuel costs.

easyJet will report the final HY1 results on May 21, but will release the usual trading update four weeks earlier. The expected loss is broadly in line with expectations and up from 2025, mainly due to one-off items. One is the strategic investment of £30 million in Milan Linate and Rome Fiumicino, where easyjet operated the first winter as the remedy taker on short-haul routes previously flown by Lufthansa and ITA Airways. The German and Italian carriers had to surrender slots at the two airports to obtain European Commission approval for Lufthansa’s minority stake in ITA. The £30 million is additional to a £20 million investment in Milan and Rome for the 2025 Summer season.

HY1 was also impacted by capacity investments since last summer that have been annualized, continued investments in digitalization, and £30 million in legal provisions. This resulted in an 8% higher CASK ex-fuel than last year.

Rising fuel costs since the Middle East conflict have led to incremental costs of some £25 million. While easyJet had hedged 80 percent of fuel costs for the period, it had to pay 18 percent of fuel costs for March at high spot prices. Still, the fuel bill for the first six months was down 5% year over year. For the summer, the airline is 70 percent hedged at $706 per tonne. “Every $100 movement in fuel prices equates to around £40 million cost in H2 FY26.”

Due to high fuel costs and geopolitical uncertainties, easyJet has withdrawn its FY26 guidance. While the airline says that demand remains strong, bookings for Q3 and Q4 are very close and slightly below last year’s. For Q3, 63 percent of capacity is sold, down 2 percentage points from 2025. “Every 1 percentage point movement in Q3 RASK equates to approximately £26 million of revenue”, the airline says. For Q4, the effect is even £33 million per percentage point.

easyJet continues to ramp up for the summer season and will raise fares to compensate for the cost increases. “easyJet’s financial strength from our investment grade balance sheet and £4.7 billion of liquidity mean we are well placed to navigate current geopolitical challenges while remaining focused on our medium term targets”, CEO Kenton Jarvis says in the trading update. 

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Richard Schuurman

Richard Schuurman is a freelance aviation reporter since 2016 and covers commercial aviation and the aerospace industry. He has contributed before to AirInsight between 2018-2024.

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