TUI, Europe's largest travel operator by market share, has reported a quarterly operating profit above expectations, noting a trend towards last-minute bookings and higher prices although analysts warned of softer demand.
The company has struggled with weakness in its core German market while bolstering results by focusing on making its offer more international and emphasising its more profitable businesses, including hotels.
But its share price remains well below levels seen three years ago, with chief executive Sebastian Ebel repeatedly saying that he hopes for an improvement.
The stock was down 3.7% in morning trade. Equity research business Bernstein pointed to a "substantial fall off in demand", although the company maintained that the results were as expected.
Citing a strong performance in holiday experiences and in markets and airlines, TUI reported an operating profit of €77.1m in the final three months of 2025, its first quarter.
This was up from €51m a year earlier and higher than the €66.7m forecast by analysts polled by LSEG.
Ebel cheered the "record" first quarter results, adding that the beat was despite losses tied to Hurricane Melissa's impact on its hotels in Jamaica.
TUI said slightly weaker winter and summer forward bookings were not a surprise.
The first three months of the year are usually the weakest for airlines and Ebel also pointed to bad weather in Germany and Britain and a resulting drop in visits to TUI's retail locations.
On a media call with journalists, he added that tourists were booking trips later and that demand has shifted away from the US and towards Asia, but that he was hopeful demand remained strong from Europeans looking to travel to the Caribbean.
TUI reconfirmed its December guidance that revenue will likely increase by 2%-4% and underlying operating profit will rise by 7%-10%, meaning it will not sustain growth from 2025 as markets had assumed.
