By Joanna Plucinska
LONDON/BERLIN, May 6 (Reuters) – Lufthansa reported better-than-expected first-quarter results on Wednesday and maintained its outlook for the year despite a sharp rise in jet fuel prices and ongoing labour disruptions.
The group warned of an additional cost of 1.7 billion euros ($1.99 billion) that will be added to its fuel bill in 2026 as a result of spiking jet fuel prices, but said it was in a good place to mitigate the impact.
“The Group intends to offset this additional financial burden in the following quarters through increased revenue from ticket sales, optimised network planning, and further cost-saving measures,” Lufthansa said in a statement.
The airline also said the crisis in the Middle East was boosting demand as travellers rerouted via its hubs.
“We are resilient in our ability to absorb these impacts,” Chief Executive Carsten Spohr said in a statement.
European airlines are expected to be shielded from the initial fallout of the jet fuel shock triggered by the U.S.-Israeli war with Iran in the first quarter, but many, such as Air France-KLM have adjusted their outlooks for the remainder of the year as jet fuel prices are set to remain high.
Bernstein analyst Alex Irving said in a note that much of Lufthansa’s strength comes from its “blockbuster” yields, adding, “we remain cautious as visibility into Q3 and Q4 yields is incomplete at this juncture.”
Lufthansa reported an adjusted operating loss of 612 million euros ($717 million) in the January-March period compared with a loss of 659 million projected by a company-compiled analyst poll. That is an improvement from an adjusted operating loss of 722 million euros in the same period last year.
It maintained its forecast for 2026 of a significantly higher adjusted operating profit than the 1.96 billion euros it earned in 2025 despite increased uncertainty.
Chief Financial Officer Till Streichert added that the outlook will be maintained “provided there are no fuel supply bottlenecks or further strikes.”
Lufthansa cabin crew and pilot unions called for strikes throughout April. Lufthansa issued two profit warnings in 2024 on the back of excess costs tied to labour disruption.
The labour disruption and jet fuel shock come as Lufthansa is looking to carry out an ambitious turnaround program across its airlines with the hopes of boosting its profit margin to 8 to 10% between 2028 and 2030. Already, the airline cut about 20,000 flights this summer in an effort to limit capacity on the back of ongoing worries over jet fuel shortages.
($1 = 0.8522 euros)
(Reporting by Joanna Plucinska; Editing by Kirsti Knolle, Muralikumar Anantharaman and Elaine Hardcastle)
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