The geothermal lagoon business in Iceland: revenue, profit, prices and visitors

The Icelandic Competition Authority counted 18 commercial bathing lagoons in 2025, up from 14 in 2021, and expects about 22 by 2030. The main ones are the Blue Lagoon, Sky Lagoon, Hvammsvík, Earth Lagoon Mývatn, Forest Lagoon, the Secret Lagoon, Vök, Fontana, Laugarás Lagoon, Reykjaböð, GeoSea, Krauma and the Highland Baths.

PwC Iceland compiled the accounts of the ten largest lagoon operators: combined revenue was about USD 84 million in 2021, USD 184 million in 2022, USD 245 million in 2023 and USD 218 million in 2024 (ISK 10.2, 22.5, 29.9 and 26.6 billion). The dip in 2024 came from volcanic eruptions that closed the Blue Lagoon for weeks; the other operators kept growing.

Very fast from a post-pandemic base: PwC calculates average revenue growth of 38% a year for the ten largest operators from 2021 to 2024. Company accounts show the same picture: Sky Lagoon's revenue rose from about USD 11 million in 2021 to USD 54 million in 2025, Forest Lagoon's from USD 3.8 million in 2022 to USD 9.6 million, and Hvammsvík's from USD 1.7 million in 2022 to USD 11 million.

The Blue Lagoon group is the largest, with the Blue Lagoon, the Retreat hotel and spa, the Highland Baths, a majority of Fontana and, subject to approval, a majority of Norðurböð (Mývatn, GeoSea and a stake in Vök). The largest independent is Sky Lagoon, 51% owned by the US company Pursuit. Other independents include Hvammsvík, Forest Lagoon, the Secret Lagoon, Laugarás Lagoon, Reykjaböð and Krauma.

The Competition Authority put the Blue Lagoon group's share of the lagoon market at 40 to 45% nationally and 45 to 50% in south-west Iceland in 2024, and noted that the share had fallen for three years as new lagoons entered. Independent lagoons near Reykjavík, such as Sky Lagoon, have taken a growing part of the market.

In the Icelandic Tourist Board's survey of foreign visitors, 57% went to a nature bath during their trip. With 2.27 million foreign visitors in 2025, that suggests roughly 1.3 million foreign lagoon visitors a year, plus repeat visits and Icelandic guests. The Blue Lagoon alone received over 1.1 million guests in 2016.

Yes. In 2025, 55% of Icelanders who paid for leisure on domestic trips used pools or geothermal baths. Regional lagoons depend heavily on locals: about 40% of Vök's guests are Icelandic, and Forest Lagoon in Akureyri reports half or more. That domestic base helps smooth the winter season.

Not yet, on the evidence: new lagoons have opened every year since 2021 while established ones kept growing and profits rose. But competition is increasing, with four or more new lagoons expected by 2030, so location and experience matter more. Sites close to Reykjavík, on the main tourist routes and with permits in place are best placed; Riftún, 30 minutes from Reykjavík with an approved plan, is one of them.

Riftún: land with an approved lagoon plan

Most established ones are. Of the ten lagoon companies whose 2025 accounts we reviewed, eight were profitable, and the established ones earned EBITDA margins of 28 to 46%. The two exceptions were Krauma, which has made a net loss every year from 2019 to 2025, and Laugarás Lagoon, which made a start-up loss in its first months. The Blue Lagoon has been profitable in every normal year since well before 2016.

Blue Lagoon hf. had group revenue of about USD 175 million (EUR 156 million) and EBITDA of about USD 33 million (EUR 29 million) in 2025, including its hotels, restaurants and skincare. In 2023 revenue was USD 157 million (EUR 140 million), with EBITDA of USD 44 million and net profit of USD 20.5 million. In 2024 eruptions closed the spa for 71 days and the company made a net loss of USD 8.5 million (EUR 7.6 million), before returning to profit in 2025.

Very. Sky Lagoon ehf. had revenue of about USD 54 million (ISK 6.6 billion) in 2025, EBITDA of USD 15.4 million (a 28% margin) and net profit of USD 12.8 million (ISK 1.56 billion), with 89 full-time staff and no interest-bearing debt. Net profit grew from USD 3.4 million in 2022 to USD 7.8 million in 2023 and USD 11.7 million in 2024. It leases its lagoon and buildings, paying about ISK 620 million (USD 5 million) a year in rent, so its margin is after rent.

Forest Lagoon opened in 2022. Its revenue grew from about USD 3.8 million in 2022 to USD 9.6 million (ISK 1.18 billion) in 2025, with EBITDA of USD 3.7 million (a 39% margin) and net profit of USD 2.0 million in 2025, on about 33 full-time staff. It opened new pools in 2025 and is building a hotel through a subsidiary.

The Secret Lagoon (Gamla laugin) at Flúðir, a historic pool reopened in 2014, had revenue of USD 6.8 million (ISK 833 million), EBITDA of USD 3.1 million (a 46% margin) and net profit of USD 2.6 million in 2025, with only about 13 full-time staff and a ticket price of ISK 4,500 (about USD 37). Revenue fell 7% in 2025 as competition increased.

Jarðböðin hf., which runs the Mývatn baths, had revenue of USD 9.5 million (ISK 1.16 billion), EBITDA of USD 4.0 million (a 42% margin) and net profit of USD 1.7 million in 2025, and paid a dividend in each year from 2023 to 2025. Its new facility, reopened in 2026 as Earth Lagoon Mývatn, was estimated in the 2025 accounts at about ISK 7.5 billion (USD 61 million) including VAT, up from ISK 2.7 billion when work began, a reminder that building costs can run far over budget.

Many do, on a smaller scale. Vök Baths near Egilsstaðir had revenue of USD 4.9 million and net profit of USD 0.9 million in 2025, with a 37% EBITDA margin; GeoSea in Húsavík had revenue of USD 3.1 million and net profit of USD 0.4 million; Fontana at Laugarvatn had revenue of USD 4.3 million and about 77,000 guests in 2024 before closing for a rebuild. Remote lagoons face stronger seasonality.

Yes. Krauma at Deildartunguhver made a net loss every year from 2019 to 2025 (USD 0.4 million on revenue of USD 2.2 million in 2025) and was recapitalised by its owners in 2024. Laugarás Lagoon lost USD 1.6 million in its first two and a half months, including start-up costs. The Blue Lagoon lost money in 2020 to 2021 during the pandemic and in 2024 during the Reykjanes eruptions.

In 2025 the established lagoons earned EBITDA margins of 28 to 46%: the Secret Lagoon 46%, Jarðböðin 42%, Forest Lagoon 39%, Vök 37%, Hvammsvík 34%, GeoSea 31% and Sky Lagoon 28% after paying rent for its leased lagoon. PwC found a wider range of 3 to 42% across the ten largest operators in 2024, which includes the Blue Lagoon's eruption year. Wages are the main cost.

Yes. Sky Lagoon paid ISK 946 million in 2024 and ISK 1.43 billion in 2025 (about USD 7.8 and 11.7 million) and proposed ISK 1.5 billion for 2026; Jarðböðin paid ISK 106.5 million a year from 2023 to 2025; Vök paid its first dividend of ISK 50 million in 2025; and the Blue Lagoon paid EUR 16 million in 2018 and EUR 30 million in 2019 before reinvesting in growth.

Adult tickets in 2026 range from ISK 4,500 (about USD 37 or EUR 33) at the Secret Lagoon to ISK 18,490 (about USD 152 or EUR 135) for the Blue Lagoon's Signature package. Most newer lagoons charge ISK 6,900 to 11,000 (USD 57 to 90) for a standard entry and ISK 10,000 to 16,000 (USD 82 to 131) for packages with extras, such as a drink, a robe or a private changing area.

The Blue Lagoon: Comfort from ISK 11,990 (about USD 98), Premium from ISK 14,990 (USD 123) and Signature from ISK 18,490 (USD 152) in 2026, with the Retreat Spa from ISK 89,000 (about USD 730). Sky Lagoon follows at about ISK 15,000 to 19,000 (USD 123 to 156). Both use dynamic pricing, so peak times cost more.

The Secret Lagoon at Flúðir (ISK 4,500), the Highland Baths in summer (about ISK 5,500), Hvammsvík's natural entry (from ISK 5,900) and municipal pools such as Guðlaug in Akranes (ISK 2,800). Lower prices tend to suit smaller sites with fewer facilities.

Profitable mid-sized lagoons run at roughly 70,000 to 200,000 visitors a year: Fontana had about 77,000 guests in 2024, GeoSea about 80,000, Forest Lagoon about 152,000, and Laugarás Lagoon targets 150,000 to 200,000. The Blue Lagoon is in a different league, with over a million guests in 2016.

Around ISK 6,500 to 7,000 (USD 53 to 57) at mid-sized lagoons. Fontana earned about ISK 6,780 per guest in 2024, of which about 62% came from bathing, 24% from its restaurant and 13% from activities; Forest Lagoon earned about ISK 6,500, with about 30% from food, drink and retail. Lagoons near Reykjavík with premium packages earn more per guest.

Very. Food, drink and retail made up about 30% of Forest Lagoon's revenue in 2024 and about 24% of Fontana's, and in-water bars, restaurants and branded products also lift spend at the Blue Lagoon and Sky Lagoon. At Riftún, the approved greenhouse plot next to the lagoon allows a greenhouse restaurant and farm shop that can add to revenue per guest.

Riftún: land with an approved lagoon plan

The Blue Lagoon's entry price rose from ISK 6,990 in 2019 to ISK 11,990 for Comfort, which has stayed at that level since 2022, with dynamic pricing on top. New lagoons have entered at ISK 6,900 to 8,000. If the proposed VAT increase passes, retail prices would rise by about 11.7% if lagoons keep their net prices.

Summer is the peak for most lagoons, but lagoons near Reykjavík are busy all year because bathing in hot water in winter darkness, sometimes under the northern lights, is a main attraction for winter visitors. Remote lagoons are more seasonal: Vök reported losses in five winter months.

Recent projects cost about USD 16 to 41 million (ISK 2 to 5 billion): Laugarás Lagoon about USD 25 million (2025), Reykjaböð in Hveragerði about USD 33 million (2026) and Sky Lagoon about USD 41 million (2021, plus a USD 16 million extension). Larger rebuilds can cost more: the new Mývatn facility was estimated at about USD 61 million including VAT in 2025. Land, hot water and permits come on top.

They vary widely: Reykjaböð is about 900 m², Laugarás Lagoon about 1,000 m², Forest Lagoon is expanding to about 1,200 m², the original Mývatn lagoon was planned at about 2,000 m², and the Blue Lagoon is about 8,700 m². The approved plan at Riftún allows up to 2,500 m², larger than most new lagoons.

Riftún: land with an approved lagoon plan

Mid-sized lagoons run with about 10 to 35 full-time equivalents: in 2025 GeoSea had 10, the Secret Lagoon about 13, Vök 16, Hvammsvík 28, and Forest Lagoon and Jarðböðin 33 each. Sky Lagoon, a large lagoon near Reykjavík, had 89. Wages were 18 to 50% of revenue across the sector according to PwC.

Typically five to ten years from idea to opening. A master plan amendment and a detailed plan each need public consultation and publication in the Official Gazette, and hot water must be found and permitted before construction. At Riftún, planning ran from 2016 to the plan coming into force in 2022, so a buyer starts at the drilling and design stage.

Riftún: land with an approved lagoon plan

It depends on size, design and climate. EFLA's model for Riftún found that 100 l/s of 100 °C water could heat a lagoon of about 2,800 m² in design winter conditions, and that the size scales roughly with the flow and temperature of hot water available. Covered areas, shelter and heat recovery reduce the need. Cooling the water to bathing temperature also requires cold water or heat exchangers.

Riftún: land with an approved lagoon plan

Lagoons need an operating licence from the regional health authority and must meet the bathing-water rules: Regulation 814/2010 for pools and bathing places, and Regulation 460/2015 for natural bathing places, which sets water-quality sampling and allows chlorine-free operation where approved. The Riftún plan specifies bathing facilities under Regulation 814/2010 with dechlorinated outflow.

Using geothermal water commercially requires a research permit and a utilisation permit from the Environment and Energy Agency (Umhverfis- og orkustofnun) under Act 57/1998, plus a municipal development permit for drilling. Landowners may use up to 3.5 MW of geothermal heat for their own use without a utilisation permit, which a large lagoon will usually exceed.

Location close to where visitors stay, a distinctive design and setting, enough hot water, good food and drink, and a pricing ladder from standard to premium. Sky Lagoon shows the value of being near Reykjavík, the Secret Lagoon shows that authenticity can deliver high margins, and Forest Lagoon shows how a local population supports year-round demand.

Many operators are adding one: the Blue Lagoon has the Retreat and Silica hotels, Hvammsvík and Forest Lagoon plan hotels, and new projects such as Fitjar and Vestmannaeyjar combine lagoons and hotels. Accommodation lengthens the stay and spend. The current plan at Riftún does not include a hotel, but holiday homes above the road can be rented to guests.

Riftún: land with an approved lagoon plan

Yes. Geothermal water can heat greenhouses first and then feed the lagoon at a lower temperature, which uses the heat twice and reduces the cold water needed for cooling. Riftún's approved plan puts about 17,100 m² of greenhouse or commercial buildings next to the lagoon plot, which suits this cascaded design.

Riftún: land with an approved lagoon plan

Possibly. The government's 2027 budget bill, published in September 2026, proposes moving lagoon admission from the 11% to the 24% VAT rate from 1 January 2027, raising about ISK 4 billion (USD 33 million) a year. If lagoons keep their net prices, tickets would rise by about 11.7%. The tourism industry opposes the change and it was not law as of October 2026.

Only lagoons in active volcanic areas are directly exposed. Eruptions on the Reykjanes peninsula since late 2023 closed the Blue Lagoon for 49 days in 2023 and 71 days in 2024, with direct costs of about ISK 7 to 8 billion (USD 57 to 66 million). Lagoons elsewhere, such as Riftún in Ölfus, are outside that eruption zone.

Riftún: land with an approved lagoon plan

Less than many tourism businesses, because hot baths are a winter attraction too, but remote lagoons still see sharp winter falls. Lagoons within an hour of Reykjavík benefit from year-round city-break and northern-lights tourism; regional lagoons rely more on Icelandic guests in winter.

Competition is rising: about four more lagoons are expected by 2030, including large projects by the Blue Lagoon group and World Class. Demand has so far kept pace, but new lagoons need a clear position on location, design and price. Being one of the few sites with an approved plan near Reykjavík is a real advantage.

Foreign visitor numbers were flat in 2025 and are forecast to dip about 1% in 2026 after the collapse of the airline Play, yet most lagoons grew revenue in 2025 and Sky Lagoon, Forest Lagoon, Hvammsvík and Vök all increased profits. Lagoons with strong domestic demand, low fixed costs and flexible staffing are most resilient.

Wages are the largest cost, at 18 to 50% of revenue according to PwC, followed by food and retail costs (6 to 14% of revenue), maintenance, water and energy, marketing and booking commissions. Some lagoons also pay rent: Sky Lagoon pays about USD 5 million a year for its leased lagoon and buildings. Owning the land and the hot-water source, as a buyer of Riftún would, avoids both rent and dependence on a utility.

Riftún: land with an approved lagoon plan

All buildings in Iceland must carry fire insurance and the compulsory natural catastrophe insurance (NTÍ), which covers earthquakes, eruptions and floods. Operators also insure business interruption and liability. Insurance premiums and terms should be part of the business plan, especially in seismic or flood-prone areas.

Opportunities are limited, as most lagoons are privately owned. The Blue Lagoon is preparing to list on Nasdaq Iceland together with Arctic Adventures, a combination reported to be worth over ISK 100 billion (about USD 820 million). Stakes in other lagoons occasionally come up, as when the utility Norðurorka sold its share in Forest Lagoon in 2025.

Reported valuations are high. Pension funds bought a stake in the Blue Lagoon in 2021 at a price implying about ISK 61 billion for the company (about EUR 410 million at the time), and the planned Blue Lagoon and Arctic Adventures combination is reported at over ISK 100 billion (about USD 820 million). Valuations of smaller lagoons are rarely published.

Announced projects include the Blue Lagoon group's Mountain Baths in Þjórsárdalur (about USD 66 million, planned 2028) and Hoffell (planned 2030), World Class at Fitjar in Reykjanesbær (about USD 164 million, targeted 2028), Hveradalir on Hellisheiði, Efri-Reykir and Vestmannaeyjar. Most are still in planning or permitting; Riftún already has an approved plan.

Riftún: land with an approved lagoon plan

Within about an hour of Reykjavík, on the Golden Circle or South Coast routes, outside active volcanic zones, with geothermal water on the land and planning in place. Ölfus, between Reykjavík and Hveragerði, meets these conditions, and investors have committed about USD 33 million to Reykjaböð in nearby Hveragerði.

Riftún: land with an approved lagoon plan

As an illustration only, not a forecast: in 2025 Hvammsvík, Forest Lagoon and Earth Lagoon Mývatn each had revenue of about USD 9.5 to 11 million with EBITDA margins of 34 to 42%. A lagoon at Riftún with 150,000 visitors a year at about USD 57 (ISK 7,000) per visitor would have revenue of about USD 8.6 million, and at a 35 to 40% margin about USD 3 to 3.4 million in EBITDA. Results depend on the size, design, hot-water supply, pricing and operator.

Riftún: land with an approved lagoon plan

Because planning is the slowest and least certain step: a master plan change and a detailed plan can take five years or more and may be refused. Land with a plan in force lets an investor move straight to resource testing and design. Riftún has both plans in force and, to our knowledge, is the only such land currently for sale in Iceland.

Riftún: land with an approved lagoon plan

Yes, through an Icelandic operating company. Investors from the EEA can own the land directly; investors from outside the EEA need a Ministry of Justice permit for land, up to 25 hectares for business use, or can partner with an EEA or Icelandic landowner. Pursuit, a US company, owns 51% of Sky Lagoon.

Foreign ownership rules · Riftún: land with an approved lagoon plan