Delta Surpasses Earnings Forecasts, Eyes Efficient Growth
Delta Air Lines has reported robust financial results for the first quarter, with a profit of $37 million, a significant turnaround from a loss of $363 million in the same period last year. Adjusted earnings were $288 million, or 45 cents a share, an improvement from $163 million in Q1 2023. Revenue came in at $12.56 billion, a 6% increase from the previous year, though this was slightly below analysts' expectations. The company also maintained its full-year forecast, anticipating earnings per share of $6 to $7 and free cash flow between $3 billion and $4 billion.
CEO Ed Bastian noted strong demand for both leisure and business travel ahead of the peak season, and the company experienced its eleven highest sales days in history. Delta's operational performance was highlighted by a load factor of 83%, up from 81% in the same quarter last year. The airline is predicting a healthy spring and summer season, and despite the global impact of recent Boeing aircraft issues, Delta expects to take delivery of an order for 100 737 Max 10 aircraft by 2027.
Following the pandemic hiring surge, Delta has now shifted focus towards efficiency, with plans for headcount to rise by low single digits this year compared to 2023. Additionally, the airline continues to invest in its premium-tier services, including co-branded credit card benefits, advanced aircraft technology, and luxury lounge launches. Despite facing a 2% decrease in passenger revenue when adjusted for capacity, Delta anticipates record revenue in the second quarter but expects lower profit margins and full-year earnings per share. Shares of Delta rose by nearly 5% in premarket trading after the earnings release.
