Flight Centre Travel Group (ASX: FLT) shares fell 3% by 12:40 pm AEST (2:40 am GMT) on Wednesday after the company's profits were dragged down by tensions in the Middle East and fewer visits to the United States during the final quarter of 2025.
While the travel agency’s underlying profit before tax for FY2025 was in line with guidance at A$289.1 million, this represents a 9.8% decrease from the previous year, with statutory profit before tax also declining 3% to A$213 million.
The company’s underlying profit had been tracking to surpass the prior year in the third quarter but dipped in the final months of fiscal 2025.
Flight Centre attributed this to growing turmoil in the Middle East, non-recurring costs in Asia and fewer Australians travelling to the U.S.
“This temporary volatility disrupted booking patterns during Flight Centre’s peak trading period – some customers either booked closer-to-home overseas holidays or delayed finalising plans – and saw the global leisure business’s underlying profit before tax dip below its strong FY24 profit,” it said.
Despite Qantas adding more inbound flights for travellers from the U.S., Flight Centre’s numbers tell a different story.
“In Australia, bookings to the US decreased by 11 per cent during the fourth quarter – a sharp turnaround from the 7 per cent increase during the first nine months of the year,” it said.
This comes as the Trump administration's crackdown on immigration is causing a slowdown in visitors to the U.S.
Flight Centre declared a total dividend of 40 cents per share, which is above market estimates of 37 cents per share according to Visible Alpha.
