Icelandair’s 2026 profit goal boosted by PLAY’s exit
Icelandair Group has reported a positive net profit only once since 2017 (in 2023, when its net margin was just 0.7%).
In addition to the challenges of the COVID-19 pandemic, faced by all airlines, it has also had to contend with two successive low-cost airline competitors. First WOW air, and then PLAY, mimicked Icelandair's North Atlantic connecting strategy over the Reykjavik hub.
However, both have left the market, and Icelandair now faces "a more rational capacity environment". Following weakness in North America-Europe yields, it is de-emphasising trans Atlantic connecting traffic in favour of more point-to-point capacity to/from Iceland.
It is also focusing on cost efficiency and fleet rationalisation.
Its goal to return to profitability in 2026 may be achievable.
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