Europe's largest travel operator Tui has reported a 43% drop in pre-tax profits to 153.4 million euro (£131 million) in its third quarter to the end of June, as the Iran war and cautious consumers hit demand.
Profit decline and customer numbers
Underlying earnings fell 27% to 233.8 million euro (£199.7 million) in the latest quarter, with customer numbers down 3% to 9.9 million. The group faced rising fuel costs due to the Middle East conflict and pressure to lower prices because of weak demand and increased competition.
Impact of geopolitical tensions
Tui suffered a hit of 81 million euro (£69.2 million) in the nine months of its financial year so far from the Iran war and hurricanes in Jamaica, including an extra 20 million euro (£17.1 million) "direct" impact from the Middle East conflict on its cruises arm during the third quarter.
In March, the firm was forced to repatriate around 5,000 passengers from two cruise ships anchored in Abu Dhabi, which remained in the Gulf ports until mid-May.
CEO comments and booking trends
Chief executive Sebastian Ebel said the group has weathered tough trading conditions, but holidaymakers are increasingly booking trips later towards their departure date. He said: "2026 is no ordinary year. Tui has held its own well in a difficult global environment. Our business model is proving to be resilient. Travel remains highly relevant to people's lives, but the timing of travel decision has shifted."
Mr Ebel added: "Wars and geopolitical tensions, consumer caution, economic weakness and rising inflation in Europe's core markets – all these factors have influenced consumer sentiment and the timing of purchasing decisions."
Business segments and outlook
Tui's markets and airline business swung to a 17.4 million euro (£14.9 million) underlying loss from profits of 49.7 million euro (£42.4 million) a year earlier. Its holiday experiences arm – including cruise liners, hotels, and TUI Musement tours – proved more resilient, with underlying earnings slipping 5.6% to 277.8 million euro (£237.3 million).
Tui kept its full-year outlook unchanged as bookings improved. Booked revenues in its markets and airline business were 6% lower over the summer season, marginally improved since May, while a 7% rise in the past four weeks indicates a recovery in demand. Greece and Spain – including the Balearic and Canary Islands – remain in high demand, while Eastern Mediterranean destinations have started to pick up again recently.
