The Qantas Group and Virgin Australia report substantial earnings despite increased fuel costs

The ACCC's Domestic Airline Competition in Australia report, published around 15 September 2026, found that the Qantas Group and Virgin Australia each reported substantial earnings for the 2025-26 financial year despite a sharp rise in jet fuel costs. Qantas Group reported underlying earnings before interest and tax of approximately 2.35 billion dollars, down 11 per cent on the previous year, while Virgin Australia reported underlying earnings of 753 million dollars, up 13.4 per cent year on year. Jet fuel prices were nearly 50 per cent higher in late August 2026 than in February 2026.

ACCC Chair Gina Cass-Gottlieb attributed the carriers' financial resilience to sustained passenger demand, higher fares, capacity adjustments and fuel hedging arrangements. The report also found that average domestic airfares were 3.5 per cent higher in May and 4 per cent higher in June 2026 compared with the same months a year earlier, before moderating in July, while seat capacity fell 2.3 per cent in both May and June compared with the prior year, with June recording the lowest capacity for that month since 2022. The Chair noted that further capacity reductions could place upward pressure on fares depending on commercial decisions and fuel prices.

The report forms part of the ACCC's ongoing monitoring of the domestic airline industry under a government direction that currently applies until December 2026, under which the ACCC collects data from Jetstar, Qantas, Rex and Virgin Australia and reports to the Treasurer at least quarterly. The report does not itself constitute enforcement action, but it keeps aviation pricing, capacity and competition on the regulator's agenda and informs any future consideration of extending or altering the monitoring direction.