Helloworld Travel downgrades profit target but reveals US bookings are holding up

Helloworld Travel (ASX: HLO) has downgraded its FY25 profit forecast, becoming the latest in the industry to feel the impact of market volatility in the second half of the year despite announcing that outbound travel to the US is holding steady.

The company, which largely operates in the leisure travel sector, has forecast underlying EBITDA of between $52 million and $56 million this financial year, down from its earlier target of between $56 million to $62 million.

The latest full-year forecast compares with EBITDA of $67.5 million reported in FY24.

Helloworld says while there has been extensive reporting on developments in the US, including “volatility and uncertainty around outbound travel”, the company says outbound volumes to the US have held up with year-to-date air sales only marginally down on the previous year.

The company adds that FY26 total forward booking volumes are experiencing double-digit growth of more than 15 per cent as at the end of April.

“The United States remains HLO’s number one destination for land sales with plus-4 per cent year-on-year (YoY) growth,” says the company.

“In other key outbound markets, medium-haul air sales to Asia and the Pacific are performing well, up circa 4 per cent YoY, while sales to Europe and the UK are only marginally down (less than 3 per cent).”

Helloworld’s profit downgrade follows Flight Centre Travel Group (ASX: FLT) last week announcing a lower full-year profit forecast for FY25 of up to 17 per cent.

Corporate Travel Management (ASX: CTD) has also reported that group revenue will be 4 per cent lower than forecast due to a fall in client activity with CEO Jamie Pherous revealing earlier this week that the biggest issue remains uncertainty in the US.

“Clients are sitting on their hands until they know what the business environment looks like,” said Pherous.

“For example, one of the big three US manufacturers is holding back decisions as they wait for clarity on tariffs. That affects travel – which, in turn, affects our business.

"We’ve seen historically that once these types of uncertainties are resolved, there’s often a sharp rebound in travel volumes. It’s too early to tell how quickly that will happen, but the pattern is consistent."

Meanwhile, Helloworld Travel reports today that cruise sales are on the rise with 40 per cent growth across the top 20 destinations and cruise lines, and forward bookings for calendar 2026 looking strong.

In Australia, the company has reported healthy demand for premium cabins on international travel to all major destinations.

Business-class sales for air travel account for 34 per cent of total air sales in the financial year to date, an increase of 7.3 per cent on FY24.

First-class air sales are up 102 per cent in terms of passenger numbers for the 10 months to the end of April 2025, driven by “more competitive fares at the pointy end”.

Total air sales in New Zealand are down 2.1 per cent year on year, as the number of tickets sold dipped 2 per cent while average fares held steady compared with FY24.

“While uncertainty has impacted near-term travel patterns and choice of destination, this is largely timing and is expected to rebound in FY26,” says Andrew Burnes, the CEO of Helloworld.

“Our business fundamentals remain strong with bookings into FY26 showing double-digit growth across our key products and markets. HLO continues to invest in its networks and expansion opportunities.”

Burnes points out that Helloworld has a strong balance sheet, with no bank debt.

“Cuts in interest rates, forecast for the first half of FY26, should see increased demand for leisure travel with the strengthening of AUD and NZD expected to further contribute to increased demand,” he says.