TUI Advances Airline Commercial Strategy Amid Third-Quarter Loss from Geopolitical Turbulence
Strategy to commercialise TUI’s airline business bolstered by launch of website supporting direct sales in June . European travel giant TUI slipped to a loss in its markets and airlines division for the April-June period, citing higher fuel costs and increased market capacity amid the conflict in Iran. TUI's markets and airlines business, which include tour operators, sales and its airline operations, posted an underling EBIT loss of €16 million ($18.5 million) for the company's fiscal third quarter. That compared to a profit of €50 million for the same period in the previous financial year. "This development was driven by weaker demand as a result of geopolitical developments and increased price pressure in a market environment characterised by higher fuel costs and additional capacity on the market," TUI says. The company is developing TUI Airline as a "commercially independent business" as part of wider group strategic initiatives, a process it says is well on track. That includes cost and network efficiencies and moves to increase its flight-only offering, a move boosted in June by the launch of tuifly.com enabling direct airline sales from its German airline. Sales for TUI’s other airline units will follow this year. “This direct distribution channel is expected to support revenue diversification by capturing higher-margin direct sales while reducing reliance on third-party booking platforms,” it says. TUI adds that summer 2026 business for the division also continues to be affected by the fallout from the war in Iran. "This is reflected in increased consumer caution and the ongoing trend towards later bookings," it says, noting booked revenue for the summer is currently 6% down. The company though does point to bookings being up 7% over the last four week, indicating a recovery in demand. It also notes that while demand has been strongest in Greece and Spain, this has also picked up for destinations in the eastern Mediterranean. Overall TUI posted an underlying group EBIT of €235 million for its third quarter and expects a profit in the range of €1.1-1.4 billion for the year ending September 2026, assuming there is no significant escalation in geopolitical tensions and fuel supplies. The top end of that guidance range is slightly below the €1.41 billion profit it made in the previous financial year.