AirAsia X: Navigating Turbulence (AAX MK, Neutral, TP: RM1.29)

AirAsia X Bhd’s (AAX) reported a headline net loss of RM128.7m in 1QFY26, mainly dragged by unrealised forex loss of RM232.1m and higher fuel cost incurred. Excluding non-recurring items, the core net profit for the quarter was estimated at RM70.4m.

AirAsia X

The results below both our estimates and consensus expectations, accounting for 15.7% and 8.0% of respective full-year forecasts. In response to high jet fuel prices due to the Iran War, AAX pivoted to a “margin over volume” strategy and implemented 10% YoY capacity reduction and aggressive fare adjustments to defend yield integrity.

“We cut FY26-F28 forecasts by an average of 28% to reflect the capacity reduction, weaker passenger growth and yields. As such, we downgrade our call to Neutral with lower target price of RM1.29 (from RM1.85), based on 7x our estimated FY27F EPS.”

Source: PIB

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Staff Writer

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