But what's really got investors spooked is the admission that it has lost market share. It is a small shift but investors are concerned that the internet might finally be eating into Flight Centre's market.
Flight Centre was founded by Australian veterinary surgeon Graham "Skroo" Turner and his partners in 1981 when they began selling discount seats which airlines offloaded cheaply after failing to sell through mainstream travel agencies.
He runs the business on a "Stone Age" corporate structure, dividing its 15,000 staff into "families, villages and tribes".
Families of about seven staff have to full take responsibility for the profit and loss of their small slice of the business and compete against other staff in the same village. In turn, villages compete with other villages in the same tribe. Family, village and tribal leaders who do well are rapidly promoted up the ranks.
Store managers can buy into a percentage of their store's profits (up to 20 per cent), and head-office costs are shared by each store, effectively making each outlet a small business.
Turner believes it's all about making staff responsible for their part of their business.
The strategy has paid dividends so far; the company has become one of the world's largest travel groups. It sells around A$16 billion worth of travel a year and operates in 11 countries through 2500 stores.
The success has made Turner the sixty-third richest person in Australia with a wealth of A$788 million.
Flight Centre sees its core business as dealing with more complex travel needs and until now has managed to avoid competing in the online booking market.
It operates on what Turner calls a "blended model" which marries online and offline bookings. Clients come into its shops to tap the expertise of a consultant, who then finds the best deal they can with the help of the internet.
It's what's known as an "omni-channel" retail model which combines bricks and mortar with online retail and has been used by other global companies such as UK retailers John Lewis and Argos.
Flight Centre is moving away from the discount airfares model by creating air travel and accommodation packages. It will sell these higher margin products by offering person-to-person advice through its vast retail network, backed by its online offering.
It looks like a smart strategy. Global leisure travel is positioned to grow strongly and there'll always been a sizeable niche of holidaymakers who want more than just the cheap airfare that online-only offerings provide.
Investors overreacted when they sold its shares down last week.
Flight Centre has survived and thrived this long, despite the rise of e-commerce, and it's a safe bet that Turner will find the right recipe to ensure it continues to prosper.
Declining living standards
Tony Abbott's government received a wake-up call about the parlous state of the Australian economy a few days ago - but it's doubtful he's listening.
During its annual visit to Australia to eye over the economy the International Monetary Fund delivered Abbott some sobering news.
Australia is entering a "new normal", where the sort of annual growth rate we can expect is just 2.5 per cent. This is down from the 3.5 per cent the country became accustomed to during the mining boom and the rate Australia's Prime Minister is relying on to help him meet his budget forecasts.
That 1 percentage point of lower growth means declining living standards for most Australians.
We're already seeing the beginnings of this trend. Real net national disposable income per capita, which is what many economists say is the best measure of living standards, has shrunk for a fourth straight quarter to 3.8 per cent below its 2011 peak. It is also now below where it stood in September 2008, just before the global financial crisis hit.
The only way this will improve is with productivity improvements and tax reform such as increasing the GST from its current 10 per cent and taxing things like food the way New Zealand has. But Abbott is slowly starting to claw back popularity with voters ahead of the election this or next year.
He won't foist the pain that comes with difficult reforms on the electorate - and in the long-run, we'll all be worse off for it.
