Deutsche Lufthansa AG

In Q2 2026, Lufthansa Group revenue increased 8% year on year to EUR 11.1 billion, a record second quarter. Adjusted EBIT declined by EUR 490 million year on year to EUR 883 million, with an adjusted EBIT margin of 3.4%. Fuel costs rose 40% and added roughly EUR 750 million of expense versus last year; management also said the measurable strike impact was EUR 150 million. Network Airlines RASK increased 6.4%, Eurowings RASK increased 9.4%, Cargo revenue exceeded EUR 1 billion with adjusted EBIT of EUR 160 million and an 11% margin, and Technik revenue rose 11% to EUR 2.2 billion with adjusted EBIT of EUR 157 million. For full-year 2026, Lufthansa now expects adjusted EBIT of EUR 1.7 billion to EUR 2.2 billion, capacity broadly flat versus prior year, adjusted free cash flow of around EUR 0.9 billion, and net investments of around EUR 2.5 billion. The company now expects about 41 aircraft deliveries for 2026, down from 45 previously. Liquidity was about EUR 10.7 billion at end-June, and net debt was around EUR 8.3 billion.

Carsten Spohr framed 2026 as a difficult operating year, pointing to the Middle East crisis, higher fuel costs, strike disruption and aircraft delivery delays, but repeatedly emphasized that demand remains extremely strong. He highlighted strength in premium cabins, Asia routes, cargo, Technik and ITA integration, and argued these conditions are accelerating Lufthansa Group’s strategic shift toward a more efficient, more premium and more international portfolio. His tone was determined and cautiously optimistic, with repeated emphasis on structural strength, cost discipline and long-term value creation.

Till Streichert focused on the mechanics behind the weaker quarter and the path to the second half. He said fuel costs were the biggest swing factor, rising 40% and adding roughly EUR 750 million, while adjusted EBIT fell to EUR 883 million and margin was 3.4%; excluding EUR 150 million of strike effects, margin would have been 1.3 percentage points higher. On cash flow, operating cash flow was EUR 2.3 billion in the first half, adjusted free cash flow was about EUR 1 billion, liquidity was about EUR 10.7 billion, and net debt was around EUR 8.3 billion. He also said the full-year fuel bill is now estimated at about EUR 8.7 billion, hedge ratios are around 81% for the full year and 86% for passenger airlines, and the company still expects around EUR 0.9 billion of adjusted free cash flow for the full year.

Analysts focused on whether Lufthansa still needs recapture rates above 100% in the back half, how far the Lufthansa Airlines turnaround and crew productivity program has progressed, and whether strikes could recur. Management said mathematically the fourth quarter still needs a recapture rate clearly above 100% to make the guidance work, but stressed that current booking trends and stronger yields support that outcome. On labor, Carsten Spohr said the company is in constructive discussions with the cabin and cockpit unions and does not expect summer strikes; he tied future growth in the core airline to higher productivity. Other questions centered on 777X timing, cargo peak-season strength, TAP, and 2027 capex/delivery cadence; management said the 777 remains planned for summer 2027 with a fallback plan using A340-300s, cargo demand is being helped by server-rack shipments and supply-chain disruptions, and 2027 will still be a transition year because of delayed deliveries.