Emirates H1 net profit plunges 66% as Iran war rattles Middle East aviation

Emirates, the Dubai-based airline, announced on November 5 that its first-half net profit dropped by 66% to 3.3 billion dirhams (US$903 million) due to airspace closures and disruptions caused by the US-Israeli war with Iran. Despite a solid contribution from its cargo business and ongoing travel demand, revenue fell by 13% to 56.9 billion dirhams.

The war has caused widespread flight delays, cancellations, and diversions across the Middle East, forcing Gulf carriers—some of the world's largest international airlines—to restore operations but with reservations about a full recovery due to recent attacks on Saudi Arabia by Iran-aligned Houthis. The airline operates across 91% of its network by the end of September, although passenger traffic and capacity remained significantly below pre-pandemic levels, with a 22% drop in passenger numbers and a 17% decrease in available seat kilometres.

Iran has not launched any strikes on UAE soil since May, but the war has increased jet fuel prices to approximately twice their pre-war levels, causing airlines to be hesitant about entering new fuel hedging contracts. Emirates' fuel costs before hedging increased by 60% year-on-year, while overall operating costs declined by 2%, resulting in a 13% increase in fuel costs.

The airline's cash position at the end of September was 54.1 billion dirhams, down from 59.6 billion dirhams six months earlier, as it utilized reserves to cover business needs. Emirates CEO Sheikh Ahmed bin Saeed Al Maktoum expressed measured optimism about the group's ability to navigate the challenges, including volatility and high fuel prices.