Capacity cuts put demand in focus
In July, IAG reduced its 2026 capacity outlook to broadly flat growth, having previously expected growth of less than 3%. The company cited weaker travel demand associated with the conflict in the Middle East.
That decision reflects a more cautious approach to expanding capacity when costs are rising and demand visibility is deteriorating. It may also help protect fares by limiting excess supply, although the benefits depend on how demand develops across individual routes.
The third-quarter update should provide a clearer picture of bookings, load factors and passenger revenue as the group moves beyond the peak summer travel period.
Transatlantic routes remain particularly important. British Airways has continued to benefit from strong premium bookings, giving IAG exposure to higher-spending business and leisure travellers. The group said in July that it was approximately 57% booked for the second half of 2026, with revenue bookings broadly in line with the previous year.
Investors will want confirmation that this resilience has continued, particularly as household budgets and corporate travel spending come under pressure.