Virgin Atlantic posts £127 million loss as Trump policy weakens US demand
Virgin Atlantic has posted a £127 million loss for 2025, a setback compared to its modest £20 million profit for 2024, attributed in part to weakened demand for US travel caused by President Trump’s policies.
The airline has also warned of potential setbacks this year stemming from Operation Epic Fury in the Middle East.
Despite these headwinds, the airline’s incoming CEO foresees a positive turnaround based on the airline’s continued investment in a distinctive passenger experience.
Virgin Atlantic posts higher revenue, at a loss due to US-heavy network
Virgin reported £3.4 billion in revenue last year, a slight increase compared to £3.3 billion in 2024. Its cash position also improved, with £630 million in reserves compared to £443 million in 2024.
However, its £74 million EBIT was significantly lower than last year’s £230 million, as rising operating costs from aircraft to labour hit.
The US carries a heavy weight in Virgin’s network, accounting for eleven of the airline’s 32 destinations, as well as 33% of the airline’s schedule and capacity. By comparison, destinations in the US account for 14% of British Airways’ network, 6% of its schedule and 8% of its capacity, based on our review of Cirium data for both carriers.
The US has been a safe bet for travel for many years. But the so-called ‘Trump Slump’ caused by the US President’s trade wars, rhetoric, and tightening immigration requirements has taken a toll on demand, with many choosing to spend their leisure budget elsewhere.
Last year, the World Travel and Tourism Council projected the US would lose $12.5 billion in international visitor spending—the only country among 184 analysed that was forecast to decline.
In his statement on the 2025 results, outgoing Virgin Atlantic CEO Shai Weiss said, “The impact of heightened geopolitical and macroeconomic uncertainty commencing in the second quarter impacted consumer sentiment, most keenly felt in the US point of sale.”
Peter Norris elaborated on this in the Chairperson’s statement on the 2025 Virgin Atlantic results, saying: “Long-haul aviation is an industry particularly exposed to geopolitical shocks and supply chain disruption.
“These always have a direct and immediate effect on near-term operating conditions and often longer-term effects on consumer confidence and therefore demand. In 2025, we saw some of this after ‘Liberation Day’ in the US – US point of sale demand was noticeably weaker than forecast in our plan, which depressed our operating profit contribution.”
Trump’s operation Epic Fury could have a further impact on Virgin Atlantic in 2026
Trump’s military actions abroad are adding another layer of complications to airline operations around the world, including Virgin Atlantic, which was forced to cancel its flights to Dubai after an attack caused a 16-hour round-trip flight diversion back to London.
But Operation Epic Fury may not impact Virgin’s performance as severely as the US President’s domestic policy, according to Virgin Atlantic’s Chairman.
“It is impossible to make a confident prediction of the lasting effect of the war in the Gulf. Our industry has sustained a very large price shock in fuel, its major input cost, quite apart from direct effects on traffic,” Norris stated. “For the longer term, major damage has been inflicted on important energy infrastructure, which is likely to prevent a full resumption of normal supply for a lengthy period.
“And consumer confidence in long-haul travel, certainly on a regional basis, may well be depressed,” he continued. “While only around 3% of our flight operations are directly affected, as we curtail service to regional airports, all of our operations have needed to be re-planned for the rest of this year to take account of the change in macro conditions.
“We have re-planned on conservative assumptions about the duration of the conflict and the spike in costs and are confident of our resilience in this scenario.”
Incoming CEO confident of Virgin Atlantic’s passenger experience investment
While the policies of US presidents may shift with the wind, Virgin Atlantic has steadily preserved its focus on providing a unique and comfortable passenger experience throughout the decades. That focus will not change, according to the airline’s incoming CEO, Corneel Koster.
“Consumers need a strong and competitive premium flag carrier. We are doubling down on our premium experience, with a 30% increase in Upper Class and Premium seating, and our customers will see this in the beautiful new cabins on Airbus A330neo deliveries this year, with a full cabin refit of our Boeing 787-9s to follow,” Koster said in his statement for the 2025 results.
“Our customers are at the heart of everything we do – we exist to innovate and delight them. We’ll play to our heritage as a challenger – bold, distinctive and always with a warm human touch. The launch of our new app, the refresh of our iconic Clubhouses at London Heathrow and New York JFK and the introduction of Starlink WiFi across our fleet will elevate the end-to-end experience.”
Virgin Atlantic CFO sees 2026 as a transitional year
Virgin Atlantic expects 2026 to be a “transitional year” as geopolitical instability and energy market volatility continue to weigh on the wider aviation sector.
Chief Financial Officer Ansar Hussain said the airline was facing a more uncertain macroeconomic backdrop, with the continuing conflict in the Middle East contributing to volatility in fuel and jet crack prices.
Despite those pressures, Virgin Atlantic said demand across its network remains resilient. First-quarter bookings are ahead of last year, supported in part by customers rerouting onto the airline’s direct services to India, the Maldives and South Africa.
The carrier also said demand on its transatlantic network remains robust, giving it a degree of resilience in one of its core long-haul markets.
Virgin Atlantic said it is continuing to monitor market developments while using its established fuel risk management and hedging strategy to manage higher fuel and jet crack costs. The airline is also taking operational and commercial measures to mitigate the impact of rising costs.
Featured Image: Cerib | stock.adobe.com
