Cathay Expects First-Half Profit to Jump to HK$6.5 Billion

By the Editorial Team · Thursday, July 23, 2026

Cathay Pacific Airways expects its first-half net profit for 2026 to reach up to HK$6.5 billion, a 75 percent increase from last year, driven by higher passenger and cargo volumes and a one-time gain from selling part of its stake in Air China. Despite challenges from Middle East airspace closures and rising fuel costs, the airline has shown resilience by boosting passenger numbers and cargo shipments while postponing some Middle East routes, with ongoing operational challenges expected later in the year.

Cathay Pacific Airways anticipates a significant rise in its first-half net profit for 2026, projecting earnings of up to HK$6.5 billion, a 75 percent increase from HK$3.7 billion during the same period last year. The Hong Kong-based airline attributed the growth to a combination of increased passenger and cargo volumes, as well as a one-time gain of approximately HK$1.4 billion from a reduction in its stake in Air China following a share sale.

Despite ongoing disruptions caused by the conflict triggered on February 28 by a United States and Israeli strike on Iran, which closed key Middle Eastern airspaces and caused fuel prices to surge, Cathay’s operations showed considerable resilience. The airline reported that Cathay Pacific and its low-cost subsidiary HK Express together carried over 3.1 million passengers in June, representing a 9 percent year-on-year increase. Cathay Cargo also recorded a 9 percent rise in freight tonnage for the first half, transporting around 145,000 tonnes in June alone.

Lavinia Lau Ho-yee, Cathay’s chief customer and commercial officer, highlighted that the demand for premium services, budget travel, and cargo shipments all contributed to the positive performance. Passenger numbers in June were 12 percent higher compared to the previous year, resulting in a 17 percent increase for the first six months. The airline noted that the traditionally slower early June period saw elevated load factors, supported by increased traffic redirected through Hong Kong due to Middle East airspace closures, as well as demand linked to the Dragon Boat Festival holiday and inbound student travel from long-haul markets.

While HK Express experienced a 4 percent decrease in June passenger numbers to approximately 650,000, it recorded a 10 percent growth overall for the first half. High load factors, exceeding 85 percent, were reported on routes to the mainland, the Philippines, and Thailand, demonstrating a significant year-on-year improvement. Cargo volumes benefited from steady regional demand, particularly shipments of semiconductors and pharmaceuticals to mainland China and Southeast Asia.

However, Cathay has delayed the resumption of direct flights to Dubai and Riyadh until late October amid renewed tensions in the Middle East. Recent adjustments to fuel surcharges have reflected rising operational costs, with fees for long-haul flights now at HK$965 per leg, up from HK$569 before the conflict.

Industry analysts note that the closure of airspace over Iran has compelled airlines to reroute flights away from Gulf hubs, affecting traditional Europe-Asia corridors. Andrew Yuen Chi-lok, executive director of the Aviation Policy Research Centre at the Chinese University of Hong Kong, observed that Cathay adapted by increasing frequencies on core European routes and strengthening its Hong Kong hub model to maintain connectivity despite the disruptions.

Looking forward, Yuen cautioned that potential escalations in the Middle East conflict could drive further fuel cost increases. Additionally, the airline faces operational challenges linked to aircraft delivery delays and supply chain constraints that may impact capacity and growth in the latter half of the year. Nevertheless, Cathay remains optimistic about sustained summer travel demand, particularly on its long-haul network and to popular short-haul destinations in northeast Asia and the mainland.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.