TUI's airline business is aiming to improve its profit margin to more than 3% in the mid-term — above pre-pandemic levels — the company said on March 25, 2025, during its capital markets day.
TUI also reaffirmed its full year 2025 guidance of delivering an underlying EBIT improvement of 7-10%, driven by “further sustainable growth” in its holiday experiences, as well as the “transformation” of its markets + airlines segment. The company's transformation strategy is focussed on creating “one scalable business”, creating more flexible holiday package offerings.
“The goal is to strengthen the synergies between the various business areas, offers customers more products and significantly increase the number of customer contacts throughout the year,” said TUI Group CEO Sebastian Ebel. He added that the transformation plan will allow the company to “become more efficient, more profitable, economically stronger”.
The company noted in February airline bookings were up only 2% in the first quarter of this year compared to last year. Ebel said in an earnings call that bookings had been slower. The company’s shares were down over 10% following the report. Bookings are expected to grow at a high single-digit rate for the second quarter and a low double-digit rate for the second half. The company added it would aim to fill its current capacity before chasing any substantial capacity expansion.
The company is also targeting a net leverage “strongly below” 1.0x in the mid-term.