TUI AG Reports Wider Loss Despite Revenue Growth in Q2

TUI AG faces challenges with a widened net loss in Q2, reporting a loss per share of 0.60 euros despite revenue growth of 1.5%. Investors should gauge how ongoing macroeconomic uncertainties impact future guidance. Revenue and EBIT outlook remains cautiously optimistic for fiscal 2025.

Date: 14-05-2025

AI Rating: 5

Revenue Growth: Despite a wider net loss, TUI AG reported a 1.5% increase in revenue for the second quarter, totaling 3.705 billion euros. This reflects ongoing resilience in the travel and tourism sector, coupled with robust consumer demand. TUI's guidance indicates an expected revenue increase of 5% to 10% for fiscal 2025. This growth, in the face of economic uncertainties, suggests potential for recovery and expansion in consumer travel preferences.

Loss Metrics: The Group's loss attributable to shareholders was 306.1 million euros compared to 294.2 million euros a prior year, indicating a deterioration in net income and profit margins. Loss per share also increased to 0.60 euros from 0.58 euros the previous year, reflecting larger operating challenges. Reported EBIT was negative 217 million euros, wider than the previous year's negative 195 million euros. Underlying EBIT loss demonstrated a similar trend, widening to 206.8 million euros compared to a loss of 188.7 million euros the prior year.

Outlook: TUI AG maintains its fiscal 2025 EBIT guidance for a growth of 7% to 10%, indicating a steadiness in its long-term strategic objectives despite current challenges. The company also anticipates a phasing effect from the Easter holidays, impacting revenue recognition into the third quarter. Investment in Holiday Experiences and transformation of the Markets + Airline business are key focal points as management seeks to capitalize on growth opportunities.

Given these insights, the overall sentiment is tempered; while revenue growth is promising, increasing losses and broadened EBITs warrant caution. Investors should monitor how macroeconomic factors influence TUI's trajectory in coming quarters.

Stocks: TUIFF