Airlines Confront High Fuel Costs and Profit Declines
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 09 2026
0mins
Source: CNBC
- Profit Decline: The International Air Transport Association (IATA) forecasts a drop in global airline net profits from $45 billion in 2025 to $23 billion in 2026, with net margins falling from 4.2% to 2%, primarily due to a $100 billion surge in fuel costs and reduced travel from Middle Eastern airspace closures.
- Strong Demand: Despite a 20% rise in fares, airlines like Etihad Airways report ticket demand is on par with pre-conflict levels, indicating consumer resilience in a high-cost environment, although future winter demand remains uncertain.
- Growing Aircraft Orders: Orders for popular jets from Airbus and Boeing remain robust despite high fuel prices, with Etihad planning to add more than 10 aircraft to its existing order book, reflecting confidence in future growth.
- Engine Reliability Issues: Airlines express frustration over new-generation engines that promise fuel efficiency but require more unscheduled maintenance than expected, leading to increased costs in a high fuel price environment.
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Analyst Views on GE
Wall Street analysts forecast GE stock price to fall
9 Analyst Rating
8 Buy
0 Hold
1 Sell
Strong Buy
Current: 378.680
Low
275.00
Averages
345.67
High
386.00
Current: 378.680
Low
275.00
Averages
345.67
High
386.00
About GE
General Electric Company, doing business as GE Aerospace, is a global aerospace propulsion, services, and systems company. It has an installed base of over 50,000 commercial and 30,000 military aircraft engines. Its segment includes Commercial Engines & Services and Defense & Propulsion Technologies. Commercial Engines & Services segment designs, develops, manufactures and services jet engines for commercial airframes, as well as business aviation and aeroderivative applications. Its services include maintenance, repair and overhaul of engines and the sale of spare parts and offers services under a variety of arrangements such as long-term service agreements, spare parts agreements or time and material contracts. Defense & Propulsion Technologies segment provides defense engines and critical aircraft systems and consists of Defense & Systems and Propulsion & Additive Technologies businesses. Its portfolio of brands includes Avio Aero, Unison, Dowty Propellers and Colibrium Additive.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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