El Al posts first quarterly loss since 2023 amid war

El Al reported a net loss of about $67 million, compared with a $96 million profit in the corresponding quarter of 2025.

By Pesach Benson, TPS

El Al on Wednesday reported a sharp financial reversal in the first quarter of 2026, posting a net loss — the airline’s first quarterly loss since early 2023.

“The effects of the campaign [against Iran], along with the increase in fuel prices and the strengthening of the shekel against the dollar, led to a decrease in revenue,” the company said in its financial statement.

The airline said revenue fell to approximately $562 million, down from about $774 million in the same quarter last year, a decline of roughly 27%.

Operating performance also weakened sharply, with EBITDAR — earnings before interest, taxes, depreciation, amortization, and aircraft leasing costs, a common airline measure of core profitability — falling to about $16 million, compared with approximately $213 million a year earlier.

El Al reported a net loss of about $67 million, compared with a $96 million profit in the corresponding quarter of 2025.

The company attributed roughly $145 million in total damage to the war with Iran, including about $90 million recorded in the first quarter.

It said the most severe impact came after Israeli airspace was closed for 40 days following the outbreak of fighting on February 28, 2026, forcing a complete suspension of operations.

“On days when there was no flight activity at all, the direct damage was approximately $4 million per day,” El Al said, adding that it gradually resumed limited operations under government instructions while repositioning aircraft abroad during the shutdown period.

The company estimated that, absent the war-related disruption, it would have posted a profit of about $23 million.

Even before the conflict, early-year performance showed signs of weakening.

Revenue fell by about 6.8% in January–February compared with the same period the previous year.

The airline also cited increased competition as foreign carriers returned to Ben Gurion Airport, reducing its market share from roughly 44% to 37%.

In addition, the strengthening of the shekel against the U.S. dollar increased local-currency costs, particularly salaries, by an estimated $22 million.

Despite the loss, El Al stressed its financial resilience. As of March 31, it held approximately $1.9 billion in liquidity, including cash, deposits, and financial investments, giving it a strong buffer during the disruption period.

Demand indicators, however, pointed to recovery momentum. The airline reported a record month in April 2026, with ticket sales reaching approximately $560 million, and said total bookings at the end of April stood at around $1.2 billion.

It also expects to increase seat capacity by 6% to 10% ahead of the summer season, supported by additional aircraft and expanded operations on core routes.

El Al’s share price has declined about 23% since the beginning of the year, reducing its market value from a peak of 8.5 billion shekels to about 7.2 billion.

The company did not issue a separate press release alongside its financial results, an unusual move as it reported the quarterly loss.