ii view: Wizz Air profit shrinks but sales trend higher

First-half results to 30 September

• Revenue up 13% to €3.8 billion (£3.2 billion)
• Operating profit down 40% to €265 million
• Net debt up 4.4% to €5.2 billion
• No dividend payment

Guidance:

• Third-quarter Revenue per Available Seat Kilometre (RASK) rose 12% year-over-year

Chief executive József Váradi said:

"Operationally, we cancelled fewer flights this year even though we operated 23% more flights compared to the first half of F26. Our on-time performance improved to above 70 per cent, lowering disruption charges and improving crew efficiency.

“During the period, we continued to invest in our future growth platform through new bases, customer experience initiatives and fleet deployment, whilst maintaining a robust balance sheet.”

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ii round-up:

Wizz Air Holdings (LSE:WIZZ) today reported reduced profits, held back by higher fuel costs, although revenue trends continuing to improve.

Operating profit for the six months to late September fell 40% to €265 million (£223 million). Improving passenger demand leaves Revenue per Available Seat Kilometre (RASK) up 12% during the third quarter versus a gain of 0.5% in Q2 and an 8% fall in Q1 as the Iran war began.

Shares in the FTSE 250 company fell 2% in UK trading having come into this latest news down by a tenth so far in 2026. easyJet (LSE:EZJ) is up by a third year-to date following a successful takeover bid. The FTSE 250 index has gained by almost 11% so far in 2026.

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Wizz operated a fleet of 276 Airbus jets as of late September, up from 243 in a year ago, with plans to grow that to 335 planes by the full year 2030 and 383 by FY 2033. At the start of the Iran war, Wizz suspended all Middle East flights accounting for around 5% of total seating, although flights to Tel Aviv have resumed.

Planes grounded via Pratt & Whitney engine inspections totalled 22 as of late September, down from 35 a year ago. The engine manufacturer continues to assess previously identified technical faults. Between 15 and 20 planes are expected to remain grounded come March 2027, falling to none by December 2027.

Wizz Air’s net debt as of late September rose 4.4% year-over-year to €5.2 billion. The airline earlier this year highlighted credit rating agency updates, with Fitch affirming a BB rating and stable outlook and Moody's lowering its rating to Ba3 from Ba2.

Launched in 2004, Wizz is targeting passenger numbers of 127 million by the financial year 2030, up from 69.7 million passengers last fiscal year. Revenues are expected to grow to €10 billion from last year’s €5.7 billion

Third-quarter results are scheduled for 28 January.

ii view:

Headquartered in Budapest, Hungary, Wizz employs around 9,000 people. Seat sales generated most revenue over this latest half-year at 57%, with ancillary revenues, such as those for luggage, making up the balance. Geographically, standout markets over its last financial year included Italy at 13% of sales, Romania 11%, and both Poland and the UK at 10% each.  

For investors, geopolitical tensions and concerns about future actions by Russia and Iran cannot be overlooked. A series of bomb warnings have recently caused disruption to airlines across Europe. Group net debt of €5.2 billion (£4.37 billion) as of late September compares to a stock market value of £1.1 billion, while the many factors outside of management’s control such as the weather and air traffic control strikes can never be ignored.

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More favourably, the company is pursuing an expansion of the group’s fleet and therefore passenger numbers and sales to 2030 and beyond. Robust passenger demand appears evident via upward trending sales. Grounded aircraft because of challenges at Pratt & Whitney continue to fall, while actions to hedge against volatile fuel and currencies remain part of the overall strategy.  

In all, while an expanding fleet of more environmentally friendly planes is appealing, more cautious investors are likely to demand a reduction in debt levels and signs of sustainable profit growth before climbing aboard.    

Positives:

• Fuel and currency hedging initiatives
• Positive environmental credentials

Negatives:

• No dividend payment
• Many factors outside of management’s control

The average rating of stock market analysts:

Hold