Delta Air Lines profit jumps almost 60% after strong summer

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Delta cut its free cash flow estimate for the year to $2 billion from the $3 billion it forecasted in the summer. Delta cut its free cash flow estimate for the year to $2 billion from the $3 billion it forecast in the summer.

Delta said that it expects solid travel demand in the last three months of the year, estimating revenue will rise 9% to 12% from the same quarter of 2022, with per-share earnings of $1.05 to $1.30, in line with estimates.

“We expect many of the same trends to continue in the fourth quarter,” CEO Ed Bastian said in a CNBC interview. There’s some pressure on fuel in the short term. “

Delta and other airlines trimmed their third-quarter forecasts in recent weeks because of a surge in fuel prices.“Obviously there’s some short-term pressure on fuel as fuel rose quickly in the third quarter and stayed relatively high into the fourth quarter,” Bastian noted.

Here’s how Delta performed in the three months ended Sept. 30 compared with Wall Street expectations based on consensus estimates from LSEG, formerly known as Refinitiv:

Adjusted earnings per share:

$2.03 cents vs. $1.95 expected.

Adjusted revenue:

$14.55 billion vs. $14.56 billion expected.

Delta brought in adjusted revenue of nearly $14.6 billion for the period, up 13% year over year and in line with analysts’ expectations.

  • Net income for the period was $1.11 billion, or $1.72 per share, up 59% from $695 million, or $1.08 per share, during the same period a year earlier. Adjusted for third-party refinery sales and other items, the company earned $2.03 during the quarter.Delta and other global airlines have cited particularly strong demand for trips abroad, with trans-Atlantic travel a standout, driving revenue for those flights up 34% in the third quarter compared with last year.
  • In addition to a surge in international trips, the carrier has said it has seen a sharp increase in demand for premium seats, like business class or premium economy. Delta reported that main cabin revenue was $6.62 billion in 2018, up 12% from the previous year. Premium product sales were $17% higher at $5.11 billion. Bastian said that business travel has recovered more than 80% to levels of 2019. Bastian announced that Delta would be making changes to its new policies. He said they may have been “too extreme”. Bastian refused to give details, but he said that changes would be announced “in the coming days.” “The demand for Delta’s premium assets was so high that customers understood we had to act.