Cathay Pacific Airways Ltd. cut its earnings outlook as passenger traffic continues to fall due to protests in China's Hong Kong Special Administrative Region (HKSAR).

Months-long protests have put intense pressure on the Hong Kong-based carrier, disrupting both travel and business. The airline said in a statement on Friday that financial results of the second half will be lower than those of the first half, reversing previous forecasts. 

Cathay also reported a second consecutive monthly drop in the number of passengers carried and warned of a "significant" decline in inbound bookings for the rest of this year, especially from the Chinese mainland and other Asian markets.

"Our expectation is that rest of 2019 will remain incredibly challenging for the airline," Chief Customer and Commercial Officer Ronald Lam said in the statement.

"The Chinese mainland market has been hit especially hard. Intense competition together with an increasing reliance on transit passengers over the short term has continued to apply additional pressure on yield."

Unrest in HKSAR has led to a slump in visitors, particularly from the Chinese mainland, which accounts for the bulk of tourists. Demonstrations spread to the airport at times, crippling operations and causing hundreds of flight cancellations.

Read more: Hong Kong tourist visits fall by about a third amid ongoing protests

Cathay, the world's worst-performing major airline in the past three months, continued to fall as its stock price dropped 2.16 percent to 9.96 HK dollars when the market closed on Friday.

HKSAR's Board of Airline Representatives (BAR), which represents more than 70 airlines that fly to and from the Asian financial hub, wrote to the government in September asking for temporary relief from landing and parking fees as well as rent and other operational costs, as they struggle to deal with the financial fallout from a sharp drop in traveler demand. 

Read more: Airlines ask Hong Kong to waive airport fees as demand drops