Aviation sector faces profit squeeze from rising fuel costs

Second-quarter financial results for Latin American and international tourism companies reveal a sharp divide between rising revenues and declining profits, primarily driven by surging aviation fuel costs. While airlines managed to increase ticket prices and overall revenue, the near-doubling of fuel expenses in the second quarter of 2026 significantly eroded margins.

In Brazil, Azul reported a shift from a R$ 1.29 billion profit to a R$ 1.04 billion loss, as aviation kerosene expenses rose by 41.2%. Latam Group saw its net profit drop by 48% despite a 27.6% increase in revenue, which reached US$ 4.2 billion. Other major carriers also faced profit contractions, with Copa Airlines seeing a 54% decline and American Airlines an 88% drop.

In contrast to the volatility in the aviation sector, the hospitality and digital platform segments showed more resilience. Hotel chains such as Hilton and Marriott reported stable or growing profits, supported by the fact that a significant portion of travel in markets like Brazil and the United States relies on land transportation rather than air travel.