Emirates Profits Drop by More Than 80% for the Past Year
To all appearances, this has been a bad year for Emirates — between the electronics and travel bans, among other factors — and that's now been confirmed. The airline said today that its profits fell by more than 80% to $340 million (from $1.9 billion) last year. Emirates Group, which operates Emirates, said its overall profits fell by 70% to $670 million.
What's the carrier attributing its profit losses to? A brutal combination of heightened immigration concerns (including the travel and electronics bans, which have hindered travel to the US), terror attacks in European cities, an attempted military coup in Turkey in July 2016 and Brexit. Emirates says that a strong US dollar has also impacted its profits.
Emirates' earnings report covers the period from April 2016 to March 2017, but we've seen evidence that things weren't going so hot for the carrier before this announcement. Back in April, Emirates said it was cutting back 20% of its 126 weekly flights to the US — specifically the Fort Lauderdale (FLL), Orlando (MCO), Seattle (SEA), Boston (BOS) and Los Angeles (LAX) markets. Then, earlier this month, we found out that Emirates was canceling one of its daily frequencies between Dubai (DXB) and New York (JFK) for just about the entire month of June.
According to the Associated Press, even though Emirates saw a dramatic drop in profits, its revenue increased to about $26 billion from $25.3 billion. For the 2016-2017 year, Emirates carried 56 million passengers, compared to 52 million passengers in the previous year.
Several negative events have surely hurt the carrier, with the biggest hit presumably being the implementation of the electronics ban and the travel ban on flights to the US. It'll be interesting to see how Emirates continues to evolve its strategy going forward as it tries to remain competitive. It offers travelers one of the premier products in the sky — including a new, updated bar that's coming shortly.
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