Air New Zealand Sees Revenue Jump, but Middle East Cost Effect Drags it Into the Red

Air New Zealand has reported a near 4% jump in annual revenues and a near 5% increase in passenger revenue for its latest financial year.

However, rising operating costs and engine availability dragged the carrier into loss-making territory.

For the 12 months to the end of June, Air New Zealand generated total revenue of $7bn; up 3.9% on the previous year.

Passenger revenue reached $6.1bn; a 4.8% increase year-over-year.

However, engine availability and rising jet fuel prices and maintenance costs – mainly due to the Middle East crisis and the resulting supply chain shortage – dragged Air New Zealand from a pre-tax profit of $164m in 2025 to a pre-tax loss of $336m this year.

While, it said certain growth buffers – particularly engine availability – are improving, Air New Zealand now sees financial year 2027 as one of transition and recovery, rather than profitability as it would have without the Middle East crisis.

Air New Zealand Chair Dame Therese Walsh said: “The Board and management have a well-defined plan to rebuild a financially resilient and commercially sustainable national airline, underpinned by our new strategy, Te Pae Hou - Our Future."

Air New Zealand Chief Executive Officer Nikhil Ravishankar said the airline had responded decisively to prolonged engine constraints and the sharp increase in fuel prices, while continuing to improve the customer experience and operational performance of the airline: “It’s been a very challenging year for aviation, and our financial result reflects these challenges. Given the price sensitivity of air travel, airlines globally have not been able to recover the full increase in fuel costs. We took quick and decisive action through fare adjustments and capacity reductions to balance affordability for customers and maximise recovery and will continue to do so.

“However, we are making real progress on what we can control, including improving our on-time performance from 77.5% in 2025 to 84% in the second half of the financial year, alongside an improvement in customer satisfaction."