Wizz Air defied its ‘worst airline’ ranking in a recent survey, as budget-conscious travelers flocked to the carrier, boosting profits despite a less-than-luxurious experience.
The airline, which is among Europe’s largest by flight routes, saw net profits swell to a record €400.7 million (about $428 million) for the six months ending in September, Wizz Air reported Thursday.
During its second quarter alone, profits were up five-fold compared to the same period a year prior.
Route expansion into new territories such as the Middle East has also boosted revenues for the six-month period, soaring 39% to €3.05 billion ($3.26 billion).
“This summer we delivered significantly improved operational performance compared to last year,” Wizz Air CEO József Váradi said, adding that fewer flights were canceled—a common qualm among travelers.
At the same time load factor—a measure of flight occupancy—has increased to nearly 93% in the six months, pointing to strong travel demand.
“Our revenue and profit results reflect the higher volumes we now operate and the enormous amount of work and investment over the past three years,” Váradi added.
While tourists typically travel during the long summer holidays Váradi said Wizz Air continues to “see positive bookings in Q3″—a sign the cooler months may continue to boost travel activity.
Some of Wizz Air’s rivals have also clocked in healthy profits.
Last week Ryanair reported 59% higher profits in the six months to September, saying it will pay investors a regular dividend for the first time in its history. Europe’s largest low-cost carrier also provided profit forecasts for the full year ahead of its earlier record in 2018.
Uncertainty threatening profits
However, it’s not all clear skies ahead for Wizz Air with economic tensions and a cost of living crisis putting consumers under a significant amount of pressure.
The company slashed the higher end of its forecast by €50 million due to operational challenges, economic volatility and security concerns owing to the Israel-Hamas war.
Wizz Air said it will suspend flights to Israel through the end of November.
The London-listed group also said it was facing issues with some of its engines this year, which would impact capacity as a result.
“While the proportion of the European short-haul fleet that is grounded is small, this should have a noticeable impact on competition and therefore pricing in summer of 2024,” Jamie Lindsay, an investor at Artemis Investment Management, told Reuters.
Wizz Air shares were down 5.2% as of 11.30 a.m. GMT.
Representatives at Wizz Air didn’t return Coins2Day‘s request for comment.
