Lufthansa Profit Falls as €750 Million Fuel Hit Outruns Strong Demand

COLOGNE — Lufthansa Group remained profitable in the second quarter of 2026 as passenger demand and ticket yields strengthened, but those commercial gains were not enough to offset approximately €750 million in additional fuel costs.

The group reported €383 million in adjusted earnings before interest and taxes for the three months ended June 30. Adjusted EBIT fell from €870 million a year earlier even as revenue increased 8% to €11.1 billion.

The result shows both sides of the current demand environment. Lufthansa sold its reduced seat capacity at higher yields and lifted the load factor at its network airlines, but fuel and strike costs still pushed the group's adjusted operating margin down to 3.4% from 8.4%.

Lufthansa attributed at least another €150 million of financial burden to strikes. Group net income fell to €123 million, while adjusted free cash flow turned negative for the quarter at €365 million.

Demand Improved, but Capacity Fell

The group's network airlines operated 3% less capacity than in the comparable quarter. Lufthansa attributed the decline mainly to six strike days in April and the reorganization of short-haul flying, including the removal of Lufthansa CityLine operations from the schedule.

Load factor still edged up to 81.6%, while unit revenue—the traffic revenue generated for each unit of capacity—increased 6.4%. Asian routes delivered the strongest pricing result, with yields more than 13% above the prior-year quarter, and Lufthansa said premium demand was particularly strong.

That combination matters because it indicates the lower capacity was not simply a response to weak bookings. The group filled a slightly greater share of fewer available seats and generated more revenue from each unit of capacity. Even so, Network Airlines adjusted EBIT fell €490 million to €137 million after fuel costs rose by more than €600 million.

Unit costs excluding fuel and emissions increased 3.1%. Lufthansa said much of that increase reflected the smaller capacity base: adjusted for the prior year's capacity, the increase would have been approximately 1%. Personnel costs and depreciation were the main nonfuel pressures.

The Full-Year Plan Has Shifted From Growth to Flat Capacity

Lufthansa now expects its 2026 capacity to remain level with 2025. That is a further reduction from the 0%–2% growth range in the group's first-quarter outlook published in May, which had already replaced an original plan for approximately 4% growth.

The latest revision is a reduction in planned growth, not a forecast that total capacity will shrink below 2025. Lufthansa has not identified additional route or frequency changes tied specifically to the August update, leaving the passenger-level effect uncertain.

The group has also replaced its earlier qualitative forecast for adjusted EBIT “significantly above” 2025 with a range of €1.7 billion to €2.2 billion. The top of that range would still exceed the approximately €2 billion adjusted EBIT reported for 2025, when Airways covered Lufthansa Group's record revenue and profit increase.

Lufthansa said the range reflects volatile kerosene prices and shorter passenger booking cycles, both of which make the second half harder to forecast. The group retained its approximately €0.9 billion adjusted free-cash-flow forecast.

Cargo and Maintenance Cushioned the Airline Decline

The passenger-airline result was partly offset by Lufthansa Cargo and Lufthansa Technik, illustrating the value of the group's nonpassenger businesses during a fuel shock.

Lufthansa Cargo increased second-quarter capacity by 2%, partly through the addition of ITA Airways belly capacity. Cargo yield rose 27% amid strong airfreight demand connected with disruption in the Middle East, and adjusted EBIT increased to €116 million from €73 million. The division's adjusted operating margin exceeded 11%.

Lufthansa Technik increased revenue 11% to €2.2 billion as demand for maintenance, repair and overhaul services remained high. Revenue from customers outside Lufthansa Group rose 23%, while adjusted EBIT increased to €157 million from €149 million.

Those gains provided diversification, but they did not offset the €490 million decline at Network Airlines or the deterioration at the Point-to-Point Airlines segment.

Eurowings Pricing Rose as Its Result Turned Negative

Eurowings (EW) reduced capacity 6% and increased unit revenue 9.4%, supported by its European operation. The airline suspended Gulf-region flights amid the Middle East conflict and moved some flying toward Mediterranean markets.

Point-to-Point Airlines adjusted EBIT nevertheless fell by €101 million to a €37 million loss. Fuel added €71 million in year-over-year cost, while nonfuel unit costs increased 10.9% amid lower capacity and higher maintenance, fees, catering, and personnel expense. Preparations to introduce the Boeing 737-8 MAX also contributed to the cost increase, according to Lufthansa.

The contrast between higher unit revenue and a segment loss is important: stronger fares do not automatically improve profitability when capacity falls and both fuel and fixed operating costs are spread across fewer seat kilometers.

What Happens Next

Lufthansa entered the second half with €10.7 billion in available liquidity. First-half operating cash flow fell by approximately €600 million to €2.3 billion, but lower net investment kept first-half adjusted free cash flow at €1.0 billion, roughly level with the prior year.

Fuel remains the largest variable in the new earnings range. Airline hedges can soften or delay a price increase but do not remove exposure, as Airways has explained in its guide to how fuel prices and hedging affect airline margins.

The second-half test is therefore not demand alone. Lufthansa must determine how much of the fuel increase can be recovered through fares and premium sales while maintaining operational stability and completing its network and fleet changes. Cargo demand, fuel-price volatility, and the timing of passenger bookings will determine where the final result lands within the €1.7 billion-to-€2.2 billion range.

For passengers, the August report confirms a smaller 2026 flying program than Lufthansa planned earlier in the year, but it does not identify new cancellations. Specific itinerary effects should not be inferred until the group's airlines publish schedule changes.