TUI's Iran Crisis Triggers Profit Warning and Revenue Guidance Suspension

Two stranded cruise ships, 10,000 evacuated passengers, and a seven-percent booking slump in key markets — the Iran conflict has carved a visible dent in TUI's financials. The travel group responded on April 22 with an ad-hoc profit warning and an unusual move: it suspended its revenue forecast entirely.

Revised Profit Range, No Revenue Target

For the full 2026 financial year, TUI now expects adjusted EBIT of between €1.1 billion and €1.4 billion at constant currencies. The previous guidance targeted growth of seven to ten percent over the prior-year figure of €1.413 billion. The midpoint of the new range sits well below that level.

The revenue forecast has been put on ice. TUI had previously aimed for growth of two to four percent on last year's turnover of €24.2 billion. The company did not specify when the suspension would end, though the next update is scheduled for the second-quarter and half-year results in May 2026.

The second-quarter picture is less grim. Adjusted EBIT is expected to improve by between €5 million and €25 million compared with the prior-year loss of €207 million.

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Ships Freed, Bookings Weak

The most visible sign of the crisis was the weeks-long blockade of Mein Schiff 4 and Mein Schiff 5 in the ports of Abu Dhabi and Doha. On April 19, both vessels used a lull in the fighting to exit the Persian Gulf. They are now taking the route south of Africa, with a stop in Cape Town, and are expected to resume their Mediterranean itineraries from mid-May.

The booking picture remains strained. In the Markets & Airline segment, booked revenues for summer 2026 are running seven percent below last year. Hotel occupancy for the second half is similarly down. TUI attributes the weakness to customer reluctance regarding destinations such as Turkey, Cyprus and Egypt, as well as the lingering effects of a hurricane in the Caribbean. The cruise business beyond the two stranded ships, however, is performing strongly, buoyed by a positive Wave Season.

Hedging Provides a Buffer

TUI has hedged 83 percent of its jet fuel requirements for summer 2026 and over 80 percent of energy costs for the cruise business for the current financial year. This limits the risk from rising energy prices but does not protect against a shortfall in bookings.

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Bernstein Research analysts see the main challenge in customers' growing tendency to book at the last minute. They note that fuel is not a problem given the hedging coverage and maintain their price target at €9.20.

The shares fell around four percent on Thursday to €6.68. The year-to-date decline now stands at roughly 25 percent, leaving the stock nearly 29 percent below its 52-week high of €9.41 reached in January. The new annual guidance is conditional on no further escalation in the Middle East and stable fuel supply.

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