Taiwan’s Starlux Airlines announced a sharp drop in second-quarter profits, revealing mounting profit pressure amid several operational and external challenges. The airline reported a net profit of just NT$8 million (around US$260,000), a significant decline compared to its strong first-quarter performance.
Chairman Chang Kuo-wei stated that Starlux will likely face these challenges well into the third quarter. He pointed to multiple factors causing this profit pressure. Internally, the company must deal with high upfront costs related to staffing. Externally, tariff uncertainties and disruptions in key travel markets have hurt passenger traffic.
The airline is gearing up for the delivery of more than ten new aircraft next year. To prepare, Starlux has started recruiting and training thousands of pilots and flight attendants. Chang explained that while these manpower costs seem burdensome now, they are crucial. Without proper staffing, the airline risks leaving planes idle, which could lead to even higher financing costs once the jets arrive.
In addition to staffing challenges, external factors have deepened the profit pressure on Starlux. For example, the airline has seen a notable drop in travel to Japan after the so-called “tsunami prophecy” dampened demand. Meanwhile, US-bound routes suffered due to visa delays affecting student and business travelers. These factors combined have led to a significant slowdown in passenger bookings on critical international routes.
Unlike its competitors, Starlux does not operate a dedicated freighter fleet. This situation means the airline cannot offset passenger revenue losses with cargo income. Other airlines managed to benefit from a surge in pre-tariff shipping demand, but Starlux was fully exposed to the slump in passenger traffic.
Despite the challenges, Starlux managed to report a net profit of NT$923 million for the first half of 2025, marking a modest increase of 2.54% from the previous year. Earnings per share stood at NT$0.31. This shows that the airline still maintains some financial stability despite current headwinds.
Looking ahead, Chang expressed cautious optimism. He expects the fourth quarter to bring a recovery as tariff policies stabilize and travel demand rebounds. However, he also warned that the recovery might be slow and gradual, requiring careful management.
In conclusion, Starlux Airlines is navigating tough profit pressure driven by both internal staffing costs and external market disruptions. Still, the airline remains hopeful that conditions will improve by the end of the year, allowing it to return to stronger profitability.
