Delta Air Lines reported a nearly 60% increase in profit for the third quarter, driven by strong travel demand, particularly for international trips. However, the company lowered its full-year earnings forecast due to a spike in fuel prices. Delta expects adjusted earnings of $6 to $6.25 per share, compared to its previous estimate of $6 to $7 per share. The company also reduced its free cash flow estimate for the year. Despite the short-term pressure on fuel costs, Delta anticipates solid travel demand in the fourth quarter.
Delta’s revenue for the third quarter was $14.6 billion, up 13% year over year and in line with analysts’ expectations. The company’s planes flew at 88% capacity, an increase of 1 percentage point from the previous year. While unit revenue from passengers decreased by 1.5%, the demand for premium seats, such as business class or premium economy, saw a significant increase. Main cabin revenue rose by 12% and premium product sales increased by 17%. Delta CEO Ed Bastian mentioned that business travel has recovered to more than 80% of 2019 levels.
Despite facing criticism for changes in its frequent flyer program and airport lounge access, Delta expressed plans to modify these policies in response to customer feedback. The company stated that changes could be announced in the coming days. Delta executives are scheduled to hold a call with analysts and media to discuss the third-quarter results, while United Airlines and American Airlines are set to report their results next week.
