SINGAPORE - Shares of Singapore Airlines slumped in morning trading on July 29, as the market reacted to the announcement of the airline group’s 59 per cent drop in first-quarter earnings.

The shares fell as much as 8.6 per cent, or 65 cents, to $6.95 minutes after the opening bell. This is the largest intra-day decline for SIA shares since August 2024.

The stock pared losses to trade at $7.08, down 6.8 per cent or 52 cents, as at the midday trading break. A heavy 23.7 million shares changed hands.

SIA said after trading hours on July 28 that

net profit slid to $186 million for six months to June

, down from $452 million in the corresponding period a year ago.

This was due to lower interest income and its share of losses of associates, SIA said.

Air India, in which SIA holds a 25.1 per cent stake, accounted for the bulk of losses from associates.

The Indian carrier’s financial performance was not included in group’s results for the same quarter in 2024 as SIA only began accounting for its share of Air India’s results from December 2024 following the

full integration of Vistara into Air India. 

CGS International analyst Raymond Yap noted that SIA underperformed due to the sizeable share of Air India’s losses in the quarter, although the Singapore business did well.

He added that SIA’s Singapore passenger and cargo businesses continued to perform, with higher operating profit that was also supported by lower fuel costs and the depreciation of the US dollar.

But SIA might continue to be affected by a weak financial performance from the Indian carrier, in light of the cuts made to its flights after the

fatal crash

of Air India flight 171 in June,he said.

DBS Bank analyst Tabitha Foo told CNBC that following the June crash, Air India reportedly saw a 20 per cent drop in bookings across domestic and international routes, while average fares dropped 8 per cent to 15 per cent.

JPMorgan Securities Asia Pacific’s Karen Li said SIA’s results will likely be deemed a major miss and downgraded the stock to neutral with a price target of $7.

However, Morgan Stanley’s Divya Gangahar Kothiyal told Bloomberg News that SIA’s passenger yields may soon start stabilising, helping to ease competitive sales pressures.

SIA and Scoot carried a record 10.3 million passengers, up 6.9 per cent from the same quarter in 2024.

But passenger yields – the amount earned per passenger for each kilometre flown – slipped 2.9 per cent to 10 cents per revenue passenger-kilometre. This was due to heightened competition, as more airlines continue to add capacity, SIA said.

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