Qantas Airways Limited

Underlying profit before tax was $1.46 billion, up 5% year over year; statutory profit after tax was $925 million, flat year over year; underlying EPS was $0.68, up 7%; and the operating margin was 12.3%. Operating cash flow was $1.8 billion, net capital expenditure was $1.8 billion, and net debt finished at $5.6 billion, at the bottom of the FY26 target range of $5.6 billion to $7 billion. Group Domestic EBIT was over $1 billion, up 14%, with an 18% margin; Jetstar Domestic earnings rose 38% with a 22% margin; Loyalty EBIT was $286 million, up 12%; and Group International underlying EBIT was impacted by 6%. For the full year, management kept guidance for transformation program benefits of $400 million, FY26 capex of $4.1 billion to $4.3 billion, second-half Group RASK up about 3%, Group International RASK up 1% to 3%, Same Job Same Pay gross impact at about $95 million for FY26, Loyalty EBIT growth of 10% to 12%, and net freight revenue in 2H26 in line with 2H25. FY27 capex is expected to rise to $5.1 billion to $5.4 billion.

Vanessa Hudson said the half was defined by execution and that the group is benefiting from strong travel demand, an integrated dual-brand portfolio, and fleet renewal. She emphasized that the new aircraft are driving better utilization, customer experience, emissions reduction, and profitability, and pointed to stronger NPS and on-time performance as proof points. Her tone was upbeat and confident, especially on Project Sunrise, long-haul premium demand, and the next 12 months of product improvements.

Rob Marcolina highlighted the key financial outcomes: $1.46 billion underlying profit before tax, $925 million statutory profit after tax, $0.68 EPS, 12.3% operating margin, $1.8 billion operating cash flow, $5.6 billion net debt, and $1.8 billion net capex. He said total unit revenue and total unit cost both rose by just over 2%, transformation remains on track to deliver $400 million for the full year, and capital expenditure is guided to $4.1 billion to $4.3 billion in FY26 and $5.1 billion to $5.4 billion in FY27. He also framed capital allocation as disciplined, noting the increased base dividend, the buyback, and the intention to use capital recycling such as Jetstar Asia closure and the planned Jetstar Japan stake sale.

Analysts focused on domestic corporate demand, international capacity versus pricing, Project Sunrise economics, capital returns, and whether long-term airline margin targets should be reset. Management said domestic demand remains strong, with SME and resources demand offsetting weaker non-resource corporate growth, while international capacity is being managed more nimbly because demand is softer ex-Australia and in some leisure markets. On Sunrise, management said the yield premium seen on Perth-London now appears to match the business case assumptions, and that if demand disappointed they could redeploy the aircraft or accelerate A380 retirements.