about 1 year ago • 2 mins
EasyJet reported a loss for the last financial year on Tuesday, but recent metrics show the firm’s getting airborne.
What does this mean?
EasyJet’s $214 million annual loss (before tax) isn’t quite as alarming as it first seems: first off, it’s a whole lot smaller than the losses racked up in Covid-addled years, which came in over $1 billion two years straight. Second, EasyJet actually has a lot to be proud of, despite its lackluster bottom line: last quarter was strong, and a record bounce-back in passenger demand saw the airline rake in its highest-ever earnings for a single quarter. And that strong final stretch helped passenger numbers triple over the financial year, while revenue grew fourfold and headed north of $6.5 billion. And with early bookings for next year already looking positive, EasyJet’s feeling confident it’ll be back at pre-pandemic capacity by next summer.
Why should I care?
For markets: Expanding while the world contracts.
It wasn’t all rosy for EasyJet: the firm’s shares fell 5% despite those upbeat stats, meaning they’re now down nearly 40% this year. And investors’ caution could be well-founded: EasyJet’s planning to up capacity while economies are cooling down, in a bet that cash-strapped customers will prioritize travel over other nice-to-haves. But demand for flights has moved in lockstep with economic growth in the past – and EasyJet’s biggest market, the UK, is hardly poised for an economic renaissance right now.
The bigger picture: It’s plane madness.
EasyJet’s already started to recruit for summer 2023, in a bid to avoid the labor snags that plagued them earlier this year. But whatever happens next year, airlines are hoping to overcome those issues and cut costs in the future by scheduling just one pilot per flight. In fact, the European Union Aviation Safety Agency is already working on the idea with plane manufacturers, and reckons single-pilot flights could take off as early as 2027.
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