Key Highlights
- Shares of Lufthansa climbed more than 8% following first-quarter earnings that exceeded Wall Street projections
- Operating loss on an adjusted basis came in at €612M, outperforming the €659M consensus estimate
- Top-line revenue increased 8% to €8.7B, though fell short of the €9.3B analyst target
- Middle East conflict has driven fuel expenses up by €1.7B through the first quarter of 2026
- Company reaffirmed 2026 annual guidance, expecting profits significantly above 2025’s €1.96B result
German airline giant Lufthansa delivered first-quarter results that surpassed analyst projections on Wednesday, sending shares climbing more than 8% during morning trading in Frankfurt.
The Frankfurt-based carrier posted an adjusted operating deficit of €612 million for the quarter, coming in ahead of the €659 million loss Wall Street had anticipated. The figure also represents an improvement from the €722 million shortfall reported during the comparable quarter a year earlier.
Top-line revenue reached €8.7 billion, marking an 8% increase from the prior-year period. Despite the growth, the revenue figure came in below the €9.3 billion consensus forecast from analysts.
The ongoing conflict in the Middle East is creating a dual impact on Lufthansa’s operations. While the situation has significantly elevated jet fuel expenses, it has simultaneously redirected passenger traffic through the carrier’s European hubs, creating stronger demand across both passenger services and freight operations.
The conflict involving Iran has contributed an additional €1.7 billion in fuel-related expenses through the first quarter alone. Facing this substantial cost pressure, Lufthansa plans to implement a combination of fare increases, capacity reductions, and additional efficiency measures in the months ahead.
The carrier has already pulled 20,000 flights from its summer timetable as part of efforts to manage capacity constraints linked to fuel availability challenges.
Annual Forecast Maintained With Caveats
Despite mounting fuel cost pressures, Lufthansa stood by its profit projections for the full year 2026. Management expects adjusted operating earnings to significantly exceed the €1.96 billion figure achieved in 2025.
Chief Financial Officer Till Streichert emphasized that the guidance assumes “no fuel supply bottlenecks or further strikes” materialize.
The qualification is significant. Industrial action from cabin crew and pilot unions throughout April resulted in €150 million in lost revenue. The airline was forced to issue two separate profit warnings during 2024 due to labour stoppages, highlighting the ongoing vulnerability to union disputes.
Streichert confirmed that fuel availability at the company’s primary hubs should remain stable through the end of June. For longer-range services to destinations in Asia and Africa, the airline is developing backup strategies that may include additional refuelling stops along routes.
Wall Street Weighs In
Barclays equity analyst Andrew Lobbenberg observed that while Lufthansa’s quarterly outperformance was more modest compared to the results Air France-KLM reported the previous week, the decision to maintain annual guidance was notable. He pointed out that keeping forecasts unchanged despite the €1.7 billion fuel cost increase and April’s strike disruptions demonstrates “marked confidence in future unit revenues.”
Chief Executive Carsten Spohr echoed this sentiment, emphasizing the company remains “resilient in our ability to absorb these impacts.”
The airline is simultaneously executing a comprehensive restructuring initiative aimed at achieving profit margins between 8% and 10% during the 2028-2030 timeframe.
Shares were trading 6% to 8% higher in Frankfurt by mid-morning Wednesday.
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