Wizz Air Earnings: Higher Operating Costs Due to Capacity Constrains; Management Maintains Outlook

No-moat Wizz Air has confirmed its full-year guidance, maintaining a stable outlook despite challenges from fleet groundings and new aircraft delivery delays. Year-over-year, overall revenues remained flat, with a modest increase of 0.5%. Notably, Wizz Air reported a 1.4% increase in revenue per available seat kilometers, driven by improvements in both ancillary and ticket revenues. This positive trend in unit revenue is expected to continue into the second half of 2025. However, available seat kilometers decreased by nearly 1%, a result of the airline’s strategic shift to shorter, more profitable routes, partially offsetting the capacity constraints caused by the grounding of 20% of the airline’s fleet by Pratt & Whitney’s GTF engines.