Delta Air Lines posts profit thanks to stronger travel demand, but rising fuel prices will squeeze 4Q bottom line

Delta Air Lines Airbus A330neo or A330-900 plane with neo engine choice of the European aircraft producer, as seen departing from Amsterdam Schiphol AMS EHAM International airport.

Nicolas Economou | NurPhoto | Getty Images

Delta Air Lines on Wednesday reported a quarterly profit and higher-than-expected income for the third quarter, but warned that greater fuel prices may strain its bottom line in late 2021 regardless of enhancing travel demand.

The Atlanta-based airline stated it expects income to proceed to recuperate over the last three months of the 12 months, to a little bit bit lower than three-quarters of the $11.four billion it introduced in in the identical quarter in 2019, earlier than the pandemic. Here’s the way it carried out in contrast with common analysts’ estimates compiled by Refinitiv:

  • Adjusted earnings per share: 30 cents versus 17 cents anticipated.
  • Revenue: $9.15 billion versus $8.four billion anticipated.

Delta posted a third-quarter profit of $1.2 billion on income of $9.15 billion, exceeding analysts’ expectations of $8.four billion. Its profit was down 19% from 2019 although it was its first quarter within the black with out contemplating federal pandemic assist. Delta and different airways have been offering comparisons to 2019, earlier than the pandemic hit.

The provider stated it expects its prices, earlier than fuel bills, to rise 6% to 8% within the fourth quarter because it ramps up flying. Delta stated it will fly 80% of its 2019 capability, up from 71% in the latest quarter.

It expects fuel prices to rise to $2.25 to $2.40, from the typical $1.97 a gallon within the third quarter.

“While demand continues to enhance, the latest rise in fuel prices will strain our potential to stay worthwhile for the December quarter,” Delta’s CEO Ed Bastian stated in an earnings launch. “As the restoration progresses, I’m assured in our path to sustained profitability as we proceed to present best-in-class service to our clients, strengthen desire for our model, whereas creating a less complicated, extra environment friendly airline.”

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