India’s largest airline, IndiGo, narrowed its quarterly loss to ₹1,879 crore in the July–September quarter, but a 67% surge in fuel costs and a weaker rupee kept it deep in the red — and its chief executive has warned passengers to expect further fare increases.
InterGlobe Aviation, IndiGo’s parent company, reported the consolidated net loss for the second quarter of fiscal year 2026–27 on Thursday, 29 October, after the market closed. The loss was 27.2% smaller than the ₹2,582 crore loss in the same quarter a year earlier, yet far worse than the ₹238 crore loss in the previous quarter. Revenue rose strongly, but it was not enough to outrun the fuel bill.
What happened
IndiGo’s total income rose 24% year on year to ₹24,311.9 crore, while revenue from operations climbed to ₹23,364 crore. Passenger ticket revenue grew 29.3% to ₹20,652.2 crore and ancillary revenue — from extras such as baggage and seat selection — rose 15.9% to ₹2,481 crore.
Total expenses, however, rose 18.6% to ₹26,188.4 crore, leaving the airline short of break-even. The single biggest driver was fuel: aircraft fuel expenditure jumped 67.2% to ₹9,966.8 crore, up from ₹5,961.8 crore a year earlier.
Chief executive Willie Walsh, who took over at IndiGo in August, said the September quarter was seasonally soft and marked by exceptionally high fuel costs and continuing geopolitical turmoil. He said the airline had responded with prudent capacity cuts and yield management, which supported strong revenue but only partly offset higher costs.
The numbers at a glance
Net loss: ₹1,879.1 crore, against ₹2,582 crore a year earlier and ₹238 crore in the previous quarter.
Total income: ₹24,311.9 crore, up 24% year on year.
Revenue from operations: ₹23,364 crore.
Total expenses: ₹26,188.4 crore, up 18.6%.
Fuel expenses: ₹9,966.8 crore, up 67.2% from ₹5,961.8 crore.
Passengers carried: 27.5 million, down 4.7%.
Capacity: 40.8 billion available seat kilometres, down 1%.
Load factor: 80.3%, down 2.2 percentage points.
Yield: ₹6.30, up 34.3%.
Fleet: 442 aircraft at the end of September.
Cash balance: ₹52,685.4 crore, including ₹39,929 crore of free cash.
Total debt: ₹87,303 crore, up 16.7%.
Why the loss narrowed — and why the underlying picture worsened
The headline improvement flatters the underlying result. A large part of the year-on-year narrowing came from a smaller foreign-exchange hit: the net currency impact fell to about ₹1,155 crore, from ₹2,686 crore a year earlier.
Strip out currency fluctuations, and the story reverses. Excluding those effects, IndiGo reported a net loss of ₹724 crore, compared with a net profit of ₹104 crore in the year-ago quarter. In other words, the airline’s core flying business lost more money than it did a year ago, even though the reported loss shrank.
Two forces explain the squeeze. First, fuel. More than half of the fuel IndiGo buys is priced in dollars, so a weaker rupee makes every litre more expensive in rupee terms. The average rupee–dollar rate weakened to ₹95.09 in the quarter, from ₹87.06 a year earlier, while the Singapore jet fuel index — a key benchmark — was about 60% higher than a year earlier. Second, demand: the September quarter is seasonally weak, falling in the monsoon period, and IndiGo cut capacity by 1% rather than fly empty seats.
Walsh put the fuel problem in stark terms, saying he had never seen anything like it in 47 years in the industry. It is not just the crude price, he said, but the premium airlines pay for fuel in India: where that premium was historically around 20–22%, it is 65% this year.
What it means for fares
For passengers, the message is blunt: fares are likely to go higher. IndiGo increased fuel surcharges across domestic and international routes earlier in October, yet Walsh said the airline has recovered only around 60% of the increase in fuel costs through fare hikes and other measures.
“We have no choice but to look to increase fares,” he said, adding that the airline expects fuel costs to stay elevated for some time. Domestic aviation turbine fuel prices rose 13.2% month on month in October, by roughly ₹16,000 per kilolitre from September levels, and Walsh warned that fuel costs could rise further in the December quarter.
The squeeze is already visible in the operating figures. IndiGo carried 4.7% fewer passengers — 27.5 million — even as ticket revenue rose 29.3%, because fares per passenger rose sharply. Yield, a measure of revenue per passenger kilometre, jumped 34.3% to ₹6.30, while the load factor — the share of seats filled — slipped 2.2 points to 80.3%.
Walsh said demand had nevertheless held up reasonably well despite higher fares, and he was encouraged by trends heading into the December quarter, which typically benefits from festival and holiday travel. The airline also said it does not see the need for any significant cost-cutting measures right now, pointing to its efficient cost base.
Middle East disruption and the Norse lease
The quarter was also shaped by disruption in the Middle East. Walsh said IndiGo is keeping a close watch on events in Saudi Arabia, where it had paused operations, and that its daily flights to the wider Middle East market had fallen from 140 to 100 because of the situation there. The context is familiar to readers here: Air India extends its Saudi flight suspensions, and Riyadh airport reopened after a two-week closure, both covered earlier on this site.
IndiGo will also end its wide-body wet-lease arrangement with Norse Atlantic from 1 November, because high fuel prices and currency depreciation make the deal less attractive. Under a wet lease, an airline leases an aircraft together with its crew and operating support. Walsh said ending the arrangement was an easy decision given fuel prices and geopolitical pressures, and that lessons from the operation would help when IndiGo introduces Airbus A350 aircraft in 2028. Its Amsterdam slots will meanwhile be maintained with Airbus A321XLR aircraft.
Why it matters
IndiGo is India’s dominant airline, with 442 aircraft and a peak of 2,020 daily flights during the quarter, so its results are a barometer for Indian aviation as a whole. A loss of this size, in a quarter when revenue grew by nearly a quarter, shows how exposed even the strongest low-cost carrier is to fuel prices and currency moves it cannot control.
The result also matters for travellers. With fuel surcharges already raised and more fare increases flagged, the winter travel season is likely to be more expensive, even as IndiGo adds capacity. The airline expects capacity to grow in the low single digits in the December quarter and across the full year, and it has kept its mid-teens capacity growth guidance for fiscal year 2028 under review.
There is one possible relief valve. Walsh said IndiGo could consider joining the government’s proposed fuel-price stabilisation scheme if its terms made economic sense. The scheme aims to moderate sharp fuel-price increases. For now, though, the airline is betting that strong demand, disciplined capacity and a large cash pile — ₹52,685 crore in total, including nearly ₹40,000 crore of free cash — will carry it through a period of elevated costs.
Timeline
July–September 2025 — IndiGo reports a net loss of ₹2,582 crore in the year-ago quarter, with a foreign-exchange impact of ₹2,686 crore.
August 2026 — Willie Walsh takes over as IndiGo’s chief executive.
October 2026 — IndiGo raises fuel surcharges across domestic and international routes.
29 October 2026 — IndiGo reports a Q2 FY27 net loss of ₹1,879.1 crore after the market closes; shares end marginally higher.
1 November 2026 — IndiGo’s wide-body wet-lease arrangement with Norse Atlantic ends.
December quarter 2026 — IndiGo expects capacity to grow in the low single digits and revenue per available seat kilometre to rise by more than 25% year on year, based on October trends.
2028 — IndiGo expects Airbus A350 deliveries to begin.
What happens next
Investors will watch the December quarter closely. IndiGo expects revenue per available seat kilometre to grow by more than 25% year on year in the quarter, based on trends seen in October, while its cost per available seat kilometre, excluding fuel, foreign exchange and mark-to-market effects, is expected to rise in the high single digits to early double digits for the full financial year.
Passengers should watch for further fare announcements as fuel surcharges feed through, and for any decision on the government’s fuel stabilisation scheme. IndiGo has also welcomed the chance to shift some operations from Mumbai airport to the new Navi Mumbai airport, which it described as strategically important for its long-term growth, even though some charges at new airports are slightly higher.
Frequently asked questions
How much did IndiGo lose in Q2 FY27?
IndiGo reported a consolidated net loss of ₹1,879.1 crore for the July–September 2026 quarter, down 27.2% from ₹2,582 crore a year earlier but sharply wider than the ₹238 crore loss in the previous quarter.
Why did IndiGo lose money if revenue rose?
Revenue rose strongly, but fuel costs surged 67.2% to ₹9,966.8 crore and the weaker rupee raised dollar-denominated costs. Total expenses of ₹26,188.4 crore exceeded total income of ₹24,311.9 crore.
Will IndiGo fares increase?
The chief executive has signalled yes. IndiGo has already raised fuel surcharges, has recovered only about 60% of the fuel-cost increase so far, and says it has no choice but to look at further fare increases while fuel prices stay elevated.
How many passengers did IndiGo carry in the quarter?
IndiGo carried 27.5 million passengers, down 4.7% year on year, after cutting capacity by 1% to 40.8 billion available seat kilometres. Its load factor was 80.3%.
What is IndiGo’s outlook for the December quarter?
IndiGo expects capacity to grow in the low single digits year on year and revenue per available seat kilometre to rise by more than 25%, based on October trends, with festival and holiday travel supporting demand.
Is IndiGo ending its Norse Atlantic lease?
Yes. The wide-body wet-lease arrangement with Norse Atlantic ends on 1 November 2026, because high fuel prices and currency depreciation make it less attractive. IndiGo says this will not affect its longer-term plans, with Airbus A350 deliveries expected in 2028.
Related coverage
IndiGo’s Saudi operations were part of the wider disruption covered earlier on this site, when Air India extends its Saudi flight suspensions and Riyadh airport reopened after a two-week closure. More business and earnings stories can be found in the Business section.