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· Posted on
February 21, 2024

Qantas announces its second positive profit forecast in two months 'coz we've all got pretty short memories

Qantas expects up to $1.45 billion in underlying profit before tax in the first half of its financial year.

What's the key learning?

  • Qantas expected to return to profit by the end of June 2023 but now, it expects up to $1.45 billion in underlying profit before tax in the first half of its financial year.
  • Qantas says consumers continues to put a high priority on travel ahead of other spending categories and apparently, the delayed flights and lost baggage of yestermonth have been forgotten.
  • Price tends to lose some of its relevance when demand is so strong.

👉 Background: Back in October, Qantas shocked the market when it said: we expect to return to profit by the end of June 2023.

👉 What happened: But now, Qantas is actually going one better. It now expects up to $1.45 billion in underlying profit before tax in the first half of its financial year. That is up $150 million from its previous guidance given just one month ago.

👉 What else: According to Qantas, consumers continue to put a high priority on travel ahead of other spending categories. And apparently we've all forgotten about the delayed flights and lost baggage of yestermonth.  

What's the key learning?

💡Price tends to lose some of its relevance when demand is so strong. Qantas is experiencing the perfect storm:

  • Robust demand
  • Supply constraints

💡So the Australian public is clearly willing to pay the prices. And that's why we have seen a massive surge in Qantas’ revenue, cash flow and profit.

💡 Qantas is now heading towards a profit that is 52 per cent higher than its previous record set in 2016. And we're all paying for it. Yikes!

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