Why did Flight Centre Travel Group (ASX:FLT) downgrade its full-year profit guidance?

Flight Centre downgraded its guidance due to two main factors: the formal divestment of its stake in the Pedal Group cycling joint venture and compounding financial pressures from the Middle East conflict.

How much did the Middle East conflict financially impact Flight Centre (ASX:FLT)?

The Middle East conflict caused an estimated $10 million hit to Flight Centre’s leisure segment profit in April alone. The ongoing regional instability persisted through May, significantly dampening the company's fourth-quarter trading results during a historically crucial volume period.

What is happening to Flight Centre’s leisure travel bookings and refunds?

Persistent geopolitical volatility has triggered a sharp rise in customer travel refunds and a notable reduction in forward leisure bookings for May and June.

How is Flight Centre’s corporate travel business performing compared to its leisure business?

Flight Centre’s corporate travel business has remained largely unaffected by the immediate disruptions caused by the Middle East conflict.

What headwinds does Flight Centre (ASX:FLT) face in fiscal year 2027?

Flight Centre’s corporate travel segment is expected to face tougher conditions in early fiscal year 2027 due to sticky, higher international airfare pricing. Management warned that these elevated price points could act as a macro headwind, potentially testing corporate travel budgets and volume growth.

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Flight Centre flags profit hit as headwinds mount

Written by Heidi Cuthbert Published May. 26 2026Last Updated May. 26 2026

Flight Centre Travel Group (ASX:FLT) flagged a downgrade to its full-year profit guidance following the formal divestment of its stake in cycling joint venture Pedal Group, coupled with compounding pressures from ongoing Middle East geopolitical volatility.

The travel giant confirmed the completion of the Pedal Group sale, noting the asset’s fiscal year 2026 underlying profit before tax is expected to touch just $5 million.

Flight Centre previously alerted investors that its fourth-quarter results were heavily impacted by the Middle East conflict, which continued through May.

The regional instability primarily struck the company's leisure segment, triggering an estimated $10 million profit hit in April alone.

While May and June traditionally represent stronger, high-volume trading periods for seasonal leisure travel, persistent geopolitical volatility has caused a sharp rise in travel refunds and a notable reduction in forward bookings over these months.

In contrast, the group noted that its corporate travel business has managed to remain largely unaffected by the immediate disruption.

However, leadership warned that the corporate segment is more likely to encounter headwinds heading into early fiscal year 2027 as it grapples with higher international airfare pricing.

The revisions come as Flight Centre continues its broader portfolio simplification strategy to focus capital on core global travel sectors, despite navigating a highly volatile international trading environment.

At the time of reporting, Flight Centre Travel’s share price was $9.96.