Air New Zealand has announced a pre-tax loss of $336 million for the 2026 financial year, a stark contrast to the $164 million earnings before taxation recorded in 2025. The airline attributes this downturn primarily to increased fuel costs, ongoing engine availability issues, and rising aviation system expenses.
The airline's total revenue rose by 3.9% to $7 billion, with passenger revenue increasing by 4.8% to $6.1 billion. However, operating cash flow decreased to $819 million from $940 million in 2025. The airline faced a significant impact from the Middle East conflict, which elevated fuel prices by $328 million, affecting the pre-tax result by $135 million after fare adjustments and capacity reductions.
Engine issues with Rolls-Royce Trent 1000 and Pratt & Whitney PW1100 engines further strained finances, costing an estimated $190 million due to lost capacity and additional maintenance expenses. Aviation system costs also surged, with New Zealand's charges rising at more than twice the rate of inflation since 2019.
Chair Dame Therese Walsh highlighted the external pressures faced by the airline, whilst CEO Nikhil Ravishankar noted improvements in operational performance, including an increase in on-time performance to 84% in the second half of the year. The airline has also retrofitted nine of its Boeing 787 fleet, with the remainder to be completed by November.
Despite these challenges, Air New Zealand is focused on its Te Pae Hou - Our Future strategy, aiming for sustainable growth and improved financial resilience. However, due to ongoing uncertainties, the airline has not provided earnings guidance for 2027.
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