Heathrow Airport said it has reduced its profit guidance for the year after downgrading passenger forecasts, citing the impact of the ongoing Middle East war on global travel demand. The airport expects adjusted EBITDA to be lower than previously projected as passenger traffic softens.
Key financial adjustments
The airport now sees adjusted EBITDA falling by A3147 million - a decline of almost 7.4% from 2025 levels - and A360 million lower than the projection published in December. Heathrow reported flat earnings of A32.03 billion last year.
Passenger trends and revised outlook
Passenger volumes increased 0.7% year-on-year to 32.8 million in the first five months of 2026, aided by the use of larger aircraft and a rise in connecting passengers. Despite that early-year uptick, the airport said ongoing instability in the Middle East is exerting notable downward pressure on traffic.
Heathrow now expects full-year passenger numbers to fall between 80.1 million and 84.5 million, with a base case of 83.6 million. That base case represents a 1.1% decline versus 2025 and a reduction of up to 5.8% from the 85 million passengers it had previously forecast for 2026.
Revenue and cost outlook
As a consequence of the downgraded traffic outlook, aeronautical revenue is expected to be A349 million lower than earlier forecasts. Operating costs are projected to rise, driven by higher employment expenses and the full-year effect of increased business rates.
Balance sheet and downside scenario
Heathrow described its balance sheet as robust, reporting liquidity sufficient to cover between 18 and 24 months of operations. The company said it retains adequate headroom under its debt covenants even in a downside scenario where passenger numbers fall as low as 69 million.
Market reaction
Shares in British Airways owner IAG fell following Heathrow A7s announcement.
This report presents the airport A7s own updated forecasts and the financial implications it disclosed, including projected reductions in adjusted EBITDA and aeronautical revenue, alongside higher operating costs and the balance sheet assessment offered by Heathrow.