Delta Air Lines CEO Ed Bastian said the company’s 2026 profit target is within reach, as the airline transfers increased fuel costs to travelers and anticipates that pricing strength will persist even as oil prices decline from recent peaks.
“I consider this development sustainable,” Bastian told CNBC. He noted that robust demand, expanded seat assortments and a more measured capacity strategy — lessons from previous cycles — should keep fares elevated despite falling oil prices.
According to consensus estimates from LSEG, Delta projected third‑quarter earnings of $2.00 to $2.50 per share, surpassing analysts’ consensus of $2.02. The company also expects revenue growth in the mid‑teens for the July‑September 2025 period, and reaffirmed its full‑year earnings outlook of $6.50 to $7.50 per share.
Below are Delta’s second‑quarter results relative to Wall Street expectations:
- Earnings per share: $1.56 adjusted vs. $1.48 expected
- Revenue: $17.67 billion adjusted vs. $17.53 billion expected
Bastian highlighted robust demand across all segments, emphasizing that Delta, the United States’ most profitable carrier, serves higher‑income travelers in a K‑shaped economy.
Premium‑seat sales outperformed economy‑class revenue, with first‑class and other premium products generating $6.92 billion, compared with $6.85 billion from the main cabin.
He added that World Cup‑related demand exceeded expectations, driven by inbound visitors, and that corporate travel increased in the quarter, led by aerospace & defense, banking and automotive sectors.
Airlines have trimmed growth plans and retired unprofitable routes following a record surge in fuel costs, causing airfares to rise nearly 27% year‑over‑year, per the latest federal data. While carriers have not yet fully transferred the higher costs to passengers, Delta expects to increase its pass‑through to roughly 100% this quarter, up from about 60%.
Delta’s revenue per available seat mile increased 17% year‑over‑year, even as cost per available seat mile rose 21%. The airline also generates revenue from cargo, maintenance services and its fuel refinery.
Net income fell 25% to $1.6 billion ($2.44 per share) in the quarter, despite a 19% rise in operating revenue to $19.76 billion. Excluding one‑time items such as third‑party refinery sales, Delta reported earnings of $1.03 billion ($1.56 per share).
The refinery in Trainer, Pennsylvania, contributed a bright spot, with revenue climbing 83% to $2.09 billion.