Qantas posts $1.3bn profit, outlines A380 retirement timeline

By Andrew Curran.

The Qantas Group has defied surging fuel prices and ongoing geopolitical unrest to post a statutory after-tax profit of AUD1.289 billion (USD930 million) for the 12 months to June 30, 2026. Qantas Group CEO Vanessa Hudson called it a “strong result”.

The Group’s preferred metric, underlying profit before tax, was AUD2.064 billion (USD1.48 billion)..

The company, which operates Qantas, QantasLink and Jetstar, among other businesses, announced its full-year results in Sydney yesterday, August 27.

Group revenue for the financial year was AUD25.516 billion (USD18.32 billion), up 7.1% on the previous financial year. Qantas International and Freight contributed revenue of AUD9.925 billion (USD7.13 billion); revenue from Qantas Domestic amounted to AUD8.026 billion (USD5.76 billion); low-cost subsidiary Jetstar contributed AUD6.022 billion (USD4.32 billion); and Qantas Loyalty generated revenue of AUD2.88 billion (USD2.07 billion), while Corporate posted negative revenue of AUD1.337 billion (USD960 million).

“This year was defined by two very different operating environments, as a result of the conflict in the Middle East,” said Hudson. “In the first half, Qantas and Jetstar were both performing strongly, with demand growing across the domestic and international networks,” said Hudson.

“The final four months of the year saw business and consumer confidence fall as the conflict and economic headwinds created uncertainty, and some large corporates and Government responded by managing their costs more tightly, reducing demand for travel.”

Fuel costs up, net debt within predicted range, and liquidity strong

Alongside falling consumer confidence and reduced demand for business travel, rising fuel prices in the second half of the 2025/26 financial year cost the Qantas Group an extra AUD610 million (USD438 million), taking the total fuel bill for the year to AUD5.7 billion (USD4.1 billion). The figure would have been worse but for the Group’s Brent crude hedging, which provided an AUD400 million (USD287.2 million) benefit. However, the company was heavily exposed to increases in refining costs.

“Jet fuel prices are expected to remain elevated through the first half of FY27,” Hudson added. “The Group will continue to take mitigating action and remains highly hedged in Brent crude oil, with significant levels of favourable participation if fuel prices decline.”

Net debt increased to AUD6.2 billion (USD4.45 billion) at the end of June 2026, in the middle of the Group’s target range of AUD5.5 billion–6.9 billion (USD3.95–4.95 billion). As of June 30, the Group’s liquidity totalled AUD13.3 billion (USD9.55 billion), including AUD3.3 billion (USD2.37 billion) in cash, AUD2.1 billion (USD1.51 billion) in committed undrawn facilities and AUD8.0 billion (USD5.74 billion) in unencumbered fleet and other assets.

Hudson was bullish about the current financial year, ending June 30, 2027. She said travel demand remains resilient as customers continue to prioritise travel.

“International demand across Qantas and Jetstar remains strong, supported by customers redirecting travel away from the Middle East, while domestic demand is tracking broadly in line with the fourth quarter of FY26.”

Qantas Group CEO Vanessa Hudson in Sydney yesterday. Photo. Qantas.

Qantas brings forward first A380 retirements

Regarding the fleet, the most notable announcement was the decision to bring forward the first A380-800 retirements to FY28 in what will be a gradually phasing out of the type. Qantas operates ten of the type on high-capacity, slot-constrained routes such as Sydney (SYD) – Los Angeles (LAX) , Sydney – Singapore (SIN) – London (LHR) , Sydney – Johannesburg (JNB)  and Sydney – Dallas Fort Worth (DFW).

But Hudson said the imminent arrival of the first A350-1000ULRs next year, plus the first of twelve B787s in FY28 and the first of twelve A350-1000s in FY29, means the Group can phase out the expensive and trouble-plagued A380 fleet earlier than previously planned.

“The next generation aircraft replacing it can fly further and will be able to operate all routes on the airline’s current international network and open up new ones,” said Hudson. “This fleet renewal is expected to significantly improve Qantas International’s earnings performance and reduce operational complexity, with its operating margin expected to increase to 10–12% from FY32.”

The Qantas Group CEO added that Qantas was also in discussions with Airbus and Boeing about converting approximately 20 of its existing purchase-right options to firm orders from 2030.

The Group is also starting to wind down its use of A330s, with the first A330-200 expected to exit the fleet within months followed by a second in early 2027. The first A330 to go is VH-EBC (msn 506), followed by VH-EBD (msn 513).

Thirty aircraft delivered last financial year, up to 31 expected this financial year

In the 2025/26 financial year, the Qantas Group took delivery of 30 aircraft, including 16 new aircraft and 14 mid-life aircraft. These included five new A321-200NXs, five new A220-300s and six new A321-200XLRs. In addition, the Group took delivery of one mid-life A319-100, two mid-life A330-300s, five mid-life DHC-8-Q400s, four mid-life B737-800s and two mid-life E190-100s.

As of June 30, 2026, the Group’s fleet stood at 372 aircraft, including ten A380-800s; sixteen A330-200s; twelve A330-300s; seven A321-200XLRs; twenty-five A321-200NXs; six A321-200s; five A320-200Ns; sixty-nine A320-200s; nine A319-100s; twelve A220-300s; fourteen B787-9s; eleven B787-8s; seventy-nine B737-800s; forty-three DHC-8-Q400s; thirty-two E190-100s; and twelve F100s. Additionally, the freight fleet includes two B747-400Fs, two A330-200Fs and six A321-200Fs.

Of the total fleet, 32 aircraft are wet-leased, including thirty E190-100s operated on behalf of Qantas by Alliance Airlines and the two B747 freighters operated by Atlas Air.

In the current financial year, subject to delays outside its control, Qantas Group expects to take delivery of up to 31 aircraft, including three A350-1000ULRs, eight A321-200XLRs, thirteen A220-300s, three A321-200Fs and four A320-200Ns. Almost two months into the new financial year, some of those aircraft have already arrived, including, most recently, the Group’s fourteenth A220-300, VH-X4N (msn 55463), which is ferrying to Australia this week.

Hudson called the new aircraft a “new era” for Qantas.

“Customers are telling us how much these aircraft are improving the flying experience, and they're a big part of what's driving our financial performance too,” the CEO said.

Photos: Qantas Group.
Contact the writer: andrew@aerosouthpacific.com