Air Arabia Q3 Profit Falls 40% as Fuel Costs and Conflict Lift Expenses

Air Arabia's third-quarter net profit fell 40% year on year to $94.6 million (AED 347.6 million), as higher fuel prices, supply-chain constraints and regional conflict raised operating costs at the Sharjah-based airline.

Revenue for the quarter ended Sept. 30 climbed 10% to $631.2 million (AED 2.3 billion). Profit before tax dropped 42% to $104.2 million (AED 382.8 million).

The carrier flew more than 5.7 million passengers in the quarter, 3% fewer than a year earlier, at an average seat load factor of 82%.

The nine-month figures followed the same pattern. Net profit for the first three quarters was $186.2 million (AED 683.7 million), down 45%. Profit before tax fell 47% to $206.2 million (AED 757.2 million). Revenue edged up 2% to $1.58 billion (AED 5.81 billion) from $1.56 billion (AED 5.71 billion) a year earlier.

Passenger numbers over the nine months fell 10% to 14.4 million, against a seat load factor of 83%.

Chairman Sheikh Abdullah Bin Mohammad Al Thani said the airline delivered a third consecutive profitable quarter in 2026 in what he called a challenging operating environment. Regional conflict weighed on that environment, he said, driving higher costs, volatility in fuel prices and supply-chain constraints that cut into profitability. Revenue growth and sustained demand for the airline's value-focused product supported the quarterly result, he said, while operational efficiency, cost control and network optimisation helped the nine-month performance through regional economic difficulties.

Air Arabia kept expanding through the period. It launched 14 routes in the first nine months across its hubs in the UAE, Morocco, Egypt, Pakistan and Saudi Arabia, lifting the network to 224 routes. Ten aircraft joined the fleet, taking it to 100 owned and leased Airbus A320 and A321 planes. Four more are scheduled to arrive before the end of 2026.

The airline's newest hub, at King Fahd International Airport in Dammam, began operations on Sept. 20, after Saudi Arabia's General Authority of Civil Aviation awarded an Air Operator Certificate to the new budget carrier. That airline was set up by a consortium led by Air Arabia and including Nesma Group and KUN Investment. It opened with double-daily flights from Dammam to Riyadh and Jeddah and a daily service to Madinah.

Capacity is growing even as traffic shrinks, which puts the pressure on unit costs rather than empty seats. Load factors stayed above 82% in both periods, so the aircraft Air Arabia flies are still reasonably full. The Dammam base adds a fresh source of demand in the kingdom at a moment when the wider business is absorbing fuel and supply-chain bills it cannot fully pass on to fare-sensitive travellers.

Air Arabia ranked 68th on a 2026 list of the 100 most valuable companies. The results were disclosed in a Thursday filing.