El Al revenue hits record high as foreign rivals stay grounded

El Al posted its highest quarterly revenue in company history for the period between July and September 2026. The Israeli flag carrier earned $1.27 billion during those three months. That figure marks an 18 percent increase compared to the same quarter last year, when revenue stood at $1.07 billion. The airline attributes the surge to strong travel demand and a lack of foreign competitors operating out of Tel Aviv.

Passenger traffic at Ben Gurion Airport remains heavily concentrated on local carriers. El Al holds a 38 percent share of that traffic. Average revenue per seat rose by approximately 7 percent over the past year. The company reported that its planes averaged a 95 percent load factor during the quarter. This high occupancy rate followed an almost 9 percent year-on-year increase in seat capacity. The airline expanded its fleet to meet the demand.

Financial data shows forward bookings reached a record $1.1 billion by the end of September. These advance payments from ticket and voucher sales represent a 16 percent jump from the same period last year. CEO Levy Halevy stated that the airline concluded the quarter with operational performance at the upper end of forecasts. He noted that input costs rose due to fuel prices and exchange rate fluctuations. Halevy said the results reflect steps taken to increase available seat kilometers and maintain high load factors.

The strong performance occurred against a backdrop of financial trouble for rival Arkia Israel Airlines. The country's third-largest carrier is currently up for sale. Arkia has been burdened by heavy debt and reportedly faces losses between $50 million and $60 million in 2026. Worker protests have been triggered by these financial troubles. Local competitor Israir has shown early interest in taking over the struggling airline.

El Al shares have increased by 589 percent over the last three years. The stock gained almost 20 percent this year. This growth lifted the company's market capitalization to NIS 11.2 billion, which is equivalent to $3.5 billion. The airline is set to be included in the Tel Aviv-35 Index of blue-chip companies this Thursday. Management also announced a dividend of $116 million for shareholders.

Lior Vider, founder of investment consultancy Profit Multiplier, noted that the prolonged suspension of flights by foreign airlines has left El Al as the dominant carrier in the market. Vider explained that even expanded capacity cannot fully offset the void left by carriers that have not returned. He said that scarce flight options force passengers to travel for business, family, or essential needs with few alternatives. This situation drives rigid demand and keeps load factors high while fueling upward pressure on fares.

Despite the revenue growth, net profit fell by almost 14 percent to $175 million. This is down from $203 million in the same quarter a year earlier. The airline attributed the decline largely to a one-off accounting charge. Higher fuel prices and negative impacts from exchange rate fluctuations also contributed to the drop. Passenger loyalty programs continued to grow, with frequent flyer membership rising to 3.78 million. The number of FLY CARD credit cards issued increased by 14 percent to 570,000.

El Al projects seat capacity will increase between 10 percent and 14 percent in the October to December quarter. Revenue per available seat is expected to rise between 1 percent and 4 percent. Vider stated that as long as geopolitical tensions keep foreign competitors at bay, El Al will continue to command strong revenues. He added that management's real test will come once international competition fully returns. At that point, the airline must preserve market share and protect its bottom line against escalating operational costs.