Delta Air Lines has exceeded its quarterly earnings expectations, but concerns about higher fuel expenses has led to a revision in its full-year profit outlook. The Atlanta-based carrier’s earnings report coincides with indications of weakening domestic travel demand, raising questions about whether consumers are scaling back travel expenditures due to dwindling household savings, the resumption of student loan repayments and elevated interest rates.
Delta CEO Ed Bastian cautioned against interpreting these developments as indicative of a broader industry trend. In an interview, he emphasized that the demand for Delta’s products remains “strong,” with its customer base in “very good financial health.”
Bastian stated, “Our domestic business is robust.”
According to REUTERS news agency, the spike in fuel costs has placed significant pressure on the company’s profitability. Delta now anticipates adjusted earnings in the range of US$6 to US$6.25 per share for the current year, a reduction from the previous estimate of US$6 to US$7 per share made in July. Despite the challenges, the company reported an adjusted profit of US$2.03 per share for the third quarter, surpassing the US$1.94 per share forecast by analysts in an LSEG survey. This performance was bolstered by a notable 35% year-on-year increase in international passenger revenue. (£1.00 = US$1.22 at time of publication).