Delta Expects Q4 Earnings Growth Despite Election Impact

Delta Air Lines expects fourth-quarter earnings between $1.60 and $1.85 per share, surpassing last year’s adjusted earnings of $1.28 per share. The airline anticipates resilient travel demand and robust holiday bookings, though it warned of a slight revenue dip surrounding the November 5 U.S. presidential election.

CEO Ed Bastian noted that consumers may pause travel plans around the election, a pattern observed in previous elections. Despite this, holiday travel demand remains strong, bolstering Delta’s optimistic forecast.

Delta’s third-quarter results slightly missed analyst expectations, with earnings per share of $1.50, just below the $1.52 projected by analysts. Revenue reached $14.59 billion, short of the expected $14.67 billion. A significant factor was the CrowdStrike outage in July, which led to flight cancellations and a $380 million revenue loss, impacting Delta’s earnings by 45 cents per share. Delta is seeking compensation from CrowdStrike and Microsoft for the disruption.

Despite the outage, Delta’s net income rose 15% to $1.27 billion, and total revenue increased 1% to $15.68 billion in Q3. Premium ticket sales, particularly for first class, outperformed the main cabin. Delta also plans to expand capacity by 3% to 4% in Q4, capitalizing on improving supply conditions in the airline industry.

For the full year, Delta maintains its adjusted earnings forecast of $6 to $7 per share, excluding the impact of the CrowdStrike outage. Delta shares, however, fell more than 5% in premarket trading following the announcement.

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Sources: AirGuide Business airguide.info, bing.com, cnbc.com