Flight Centre Travel Group has delivered a robust first half in FY26, reporting record total transaction value and profit growth, underpinned by AI-driven efficiency and strategic portfolio reshaping.
- Record half-year total transaction value (TTV) of $12.5 billion, up 7%
- Underlying profit before tax (UPBT) increased 4% to $125 million
- Corporate division leads growth with 20% profit uplift and Asia returning to profitability
- Leisure division achieves 10% TTV growth, boosted by digital channels and cruise sector
- Ongoing capital management includes $200 million share buyback and $450 million convertible note issuance
Strong Half-Year Performance Amid Market Challenges
Flight Centre Travel Group (ASX:FLT) has reported a solid start to FY26, with its half-year results showcasing resilience and growth in a complex global travel environment. The group posted a record total transaction value (TTV) of $12.5 billion, marking a 7% increase year-on-year, alongside a 4% rise in underlying profit before tax (UPBT) to $125 million. Underlying EBITDA also grew 9% to $213 million, reflecting operational efficiencies and strong demand across its diversified travel businesses.
Corporate Division Drives Accelerated Profit Growth
The corporate segment emerged as the standout performer, delivering a 20% increase in underlying profit to $115 million on a 6% TTV growth to $6.3 billion. This division, now Flight Centre’s largest by transaction value, has expanded its addressable market through new revenue streams such as payments, meetings and events, and consulting services. Notably, the Asia region returned to profitability after prior losses, signalling a successful turnaround. The division’s dual-brand strategy, combining Corporate Traveller and FCM, leverages technology and AI to enhance service delivery and operational leverage.
Leisure Business Evolves with Digital and Specialist Growth
Flight Centre’s leisure division recorded a 10% increase in TTV to $6 billion, driven by strong growth in digital sales and specialist travel categories. Online sales surged 14% to nearly $900 million, reflecting the company’s strategic shift to digital channels for high-volume transactions. The cruise sector, bolstered by the recent Iglu acquisition, is on track to exceed $2 billion in annualised TTV, underscoring the group’s focus on high-growth leisure segments. While leisure profit was slightly down year-on-year in the half, the division achieved record profit levels in January 2026, indicating positive momentum heading into the second half.
AI and Productivity Initiatives Enhance Efficiency
Flight Centre continues to embed artificial intelligence across its operations, with AI tools like Mel and Sam improving consultant efficiency, reducing cost-to-serve, and delivering personalised customer experiences. The group’s Productive Operations initiative has driven a 13% productivity increase in the corporate business and a 6% reduction in full-time employees, highlighting gains in operational efficiency. These technology investments are expected to further enhance margins and scalability as they are fully deployed.
Capital Management and Strategic Portfolio Reshaping
Capital management remains a priority, with Flight Centre executing a $200 million on-market share buyback and issuing a $450 million convertible note to refinance existing debt and partly fund acquisitions like Iglu. The group is actively simplifying its portfolio by divesting non-core assets such as Cross Hotels & Resorts and focusing on high-growth sectors including luxury travel, cruise, and corporate meetings and events. This strategic repositioning aims to capture emerging opportunities and sustain long-term shareholder value.
Outlook and Market Position
Flight Centre reaffirmed its FY26 guidance, expecting underlying profit before tax between $315 million and $350 million, representing approximately 15% growth year-on-year. The company anticipates a stronger second half driven by seasonal leisure demand, productivity gains, and a continued recovery in Asia. With global passenger traffic forecast to grow nearly 5% in 2026 and corporate travel budgets stabilising, Flight Centre’s diversified business model and AI-driven efficiency position it well to capitalise on market opportunities.
Bottom Line?
Flight Centre’s blend of technology innovation, strategic portfolio focus, and capital discipline sets the stage for sustained growth amid evolving travel dynamics.
Questions in the middle?
- How will AI-driven productivity gains translate into margin expansion in the second half?
- What impact will front-loaded cruise investments have on leisure division profitability going forward?
- How effectively can Flight Centre expand its corporate services into new high-margin sectors?