Big online travel agency hit by ‘disappointing’ change
Major online travel agency Webjet is set to take a hit on commissions after Virgin Australia said it would return to the holiday packages market under its own label.
Virgin’s change, which includes other Webjet commercial arrangements and is likely to affect other online travel businesses, will come into force from July 1.
Webjet, which announced its full-year results on Wednesday, said that if the change had started at the beginning of 2026 it would have cost the group $3 million in underlying revenue.
Chief executive Katrina Barry said the impact of Virgin’s decision was significant, although the carrier remained a “valued partner”.
“This has a significant impact on our future advertising,” he said in an earnings briefing.
Serving primarily the Australian and New Zealand markets, Webjet provides digital platforms for consumers to plan and book flights, hotels, holiday packages and car rentals.
Trading ground to a halt on Tuesday following Virgin’s announcement ahead of a return to normal trading on Wednesday.
Webjet had net profit attributable to investors of $3.5 million for the year ended March 31, down from a downwardly revised $2 million in 2025.
Underlying earnings before interest, tax, depreciation and amortization fell 20 percent to $28.1 million, on marginally higher revenue of $136.4 million.
Total bookings this year had already fallen and Ms Barry said this was disappointing, noting that the domestic market was down 10 per cent.
“This really reflects the life pressures and higher fees (charged by airlines) that are affecting our mass mortgage generation customers,” he said.
“International bookings have increased (by one per cent) and this growth has now been slightly skewed towards short-haul destinations, particularly around Asia Pacific destinations, in recent months.”
Webjet also faces AI headwinds that threaten the broader online travel industry as it allows travelers to use the tool to make their own arrangements.
Throughout 2026, Webjet will be rolling out predictive AI tools in flight searches to help it predict prices and adjust prices to attract customers, Ms. Barry said.
“This offers our customers truly competitive prices,” he said.
Virgin announced the launch of Virgin Australia Holidays on Tuesday, citing YouGov research showing 75 per cent of travelers are more likely to book holidays through the airline.
Webjet shares were at 49 cents when the trading halt was called, giving it a market capitalization of $192.3 million.
Webjet announced it will distribute a second-half dividend of two cents per share, bringing its total for the year to four cents.
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