Delta Air Lines sees strong holiday travel despite inflation
Leading air carrier sees 'robust domestic and international demand' despite higher ticket prices
Delta Air Lines is not allowing an uncertain economic environment to cloud its optimistic outlook on holiday travel. The world's largest airline by revenue is projecting that revenue will top pre-pandemic levels.
"It’s going to be a very strong holiday season" from Thanksgiving to New Year’s, even with high inflation, which accelerated in September, CEO Ed Bastian said Thursday during the airline's third quarter analyst call.
Delta Air Lines
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| DAL | DELTA AIR LINES INC. | 63.41 | -0.41 | -0.64% |
The chief executive noted that travel recovery will continue "as consumer spend shifts to experiences and demand improves in corporate and international."
Bastian said advanced bookings — typically three or four months into the future — and comments from big corporate customers point to "very strong" travel demand through the fourth quarter and into early next year.
INFLATION TO CURB HOLIDAY TRAVEL PLANS
Delta President Glen Hauenstein shared a similar sentiment saying the air carrier projects that its fourth quarter revenue will be up 5% to 9% compared to the same time in 2019 due to "corporate travel improving and robust domestic and international demand."
Delta Air Lines planes are seen at John F. Kennedy International Airport on the July 4th weekend in Queens, New York City. The airline says it's on track to achieve 2024 targets of over $7 adjusted earnings per share and $4 billion of free cash flow. (Reuters/Andrew Kelly/File Photo / Reuters Photos)
The positive outlook comes after the Atlanta, Georgia-based airline delivered "record quarterly revenues and a double-digit operating margin" during the three-month period ending in September, according to Bastian.
WHAT THANKSGIVING, CHRISTMAS TRAVEL COULD COST YOU THIS YEAR
Delta Air Lines passenger jets rest on the tarmac, July 21, 2021, at Boston Logan International Airport, in Boston. The air carrier expects December quarter revenue recovery to accelerate relative to 2019. (AP Photo/Steven Senne / AP Newsroom)
That was possible because the average passenger paid 23% more per mile than during the same months of 2019. Revenue from premium customers rose, while money from the main cabin dipped slightly.
Operating revenue grew 11% to $13.98 billion compared to the same quarter in 2019.
Net income fell 54% to $695 million.
Cost per available seat mile (CASM) increased 43% to 19.87 cents.
Fuel expense jumped 48% to $3.3 billion with the average price per gallon rising 84% to $3.57.
CLICK HERE TO READ MORE ON FOX BUSINESS
The Associated Press contributed to this report.