Financial Performance - Operating income for the March 2025 quarter was $569 million, a decrease of $45 million compared to the March 2024 quarter[73]. - Total revenue increased by $292 million, or 2%, to $14.04 billion, driven by demand for premium products and a 4% increase in capacity[74][81]. - Passenger revenue rose by $349 million, or 3%, to $11.48 billion, with premium products and loyalty travel awards contributing significantly[81]. - Total operating expenses increased by $337 million, or 3%, to $13.47 billion, primarily due to higher employee costs and increased landing fees[75][90]. - Revenue passenger miles (RPM) increased by 3% to 55,678 million in Q1 2025 from 54,207 million in Q1 2024[105]. - Total revenue per available seat mile (TRASM) decreased by 2% to 20.53 cents in Q1 2025 compared to 20.98 cents in Q1 2024[105]. - Adjusted TRASM for Q1 2025 was 18.97 cents, down from 19.17 cents in Q1 2024, reflecting a decrease of 1.04%[129]. - Free cash flow for Q1 2025 was $1,280 million, derived from net cash provided by operating activities of $2,378 million and net cash used in investing activities of $1,224 million[131]. Cash Flow and Liquidity - Cash flow from operating activities generated $2.4 billion, with total cash sales to American Express reaching $1.9 billion, a 13% increase year-over-year[77]. - Free cash flow for the March 2025 quarter was $1.3 billion, following $1.2 billion in cash used for investing activities[78]. - As of March 31, 2025, Delta had $6.8 billion in cash and undrawn credit facilities, ensuring liquidity for the next twelve months[110][111]. Fuel Expenses - The average price per gallon of fuel decreased to $2.45 from $2.81, contributing to a $188 million reduction in fuel expenses[93]. - Delta's average price per fuel gallon decreased by 11% to $2.47 in Q1 2025 from $2.79 in Q1 2024[105]. - Total fuel expense for Q1 2025 was $2,410 million, a decrease of 7.2% from $2,598 million in Q1 2024[128]. - Fuel expense represented approximately 18% of total operating expenses in Q1 2025, down from 20% in Q1 2024[114]. Capital Expenditures - Capital expenditures for Q1 2025 were $1.2 billion, with an expected total capital spend of approximately $5.0 billion for the year, primarily for aircraft and technology enhancements[119]. Employee Compensation - Delta paid $1.4 billion in profit sharing in February 2025 related to 2024 pre-tax profit, with an accrual of $124 million for Q1 2025[115][116]. - The company withheld a total of 1,155,756 shares from employees during Q1 2025 to satisfy tax obligations[139]. Tax and Regulatory Information - The company projects an annual effective tax rate for 2025 between 24% and 26%[100]. - The company made no changes to its internal control over financial reporting that materially affected its financial reporting[135]. - There were no material changes in market risk from the previous disclosures in the Form 10-K[133]. - The company did not report any material changes in legal proceedings from the previous Form 10-K[136]. Refinery Segment Performance - Refinery segment generated operating revenue of $1.698 billion for the three months ended March 31, 2025, a decrease of $351 million compared to $2.049 billion in 2024[104]. - Operating loss for the refinery segment was $1 million in Q1 2025, down from operating income of $49 million in Q1 2024, primarily due to lower pricing of refined products[104]. Cost Metrics - CASM-Ex for Q1 2025 was 14.44 cents, slightly up from 14.08 cents in Q1 2024, indicating an increase of 2.55%[130]. - Adjusted CASM for Q1 2025 was 19.69 cents, down from 20.04 cents in Q1 2024, reflecting a decrease of 1.75%[130].

Core Insights - Delta Air Lines experienced a year-over-year revenue growth of 3.3% in the March quarter despite facing broad economic uncertainty [1] - The company revised its March quarter outlook downward, expecting total revenue growth of 3% to 4%, down from an earlier guidance of 7% to 9% [4] - Delta's premium, loyalty, and international businesses showed resilience, while domestic and main cabin businesses were weaker [5][6] Revenue Performance - Revenue growth was 7% in premium products, 11% in loyalty travel rewards, and mid-single digits in international [6] - Main cabin revenue decreased by 1%, and domestic revenue fell by 3% [6] Corporate Environment - Corporate sales growth moderated, with low-single digits year-over-year increase, attributed to reduced corporate confidence impacting growth in February and March [6] - Delta's CEO noted that the macroeconomic environment was more challenging than initially anticipated, leading to a stall in growth [2]

Financial Data and Key Metrics Changes - The company reported pre-tax earnings of $382 million or $0.46 per share, flat compared to the previous year [7] - Revenue increased by 3.3% year-over-year, reaching a record for the March quarter, with an operating margin of approximately 5% [7][16] - Free cash flow was $1.3 billion, with a double-digit return on invested capital [7] Business Line Data and Key Metrics Changes - Premium and loyalty revenue grew approximately 7% year-over-year, with American Express revenue increasing by 13% to $2 billion [18] - Cargo revenue rose 17% year-over-year due to higher yields and volume growth, while MRO revenue increased by 7% [19] - Domestic revenue grew by 1%, impacted by demand softness in the main cabin, while international revenue grew by 7% [19] Market Data and Key Metrics Changes - Domestic market showed softness in consumer and corporate travel, particularly in the Main Cabin [11] - International revenue growth was driven by strong performance in the transatlantic and Pacific markets, with transatlantic revenue growing by 5% and Pacific revenue by 16% [20] - Approximately 80% of international revenues are from U.S. point of origin, with strong bookings for the peak summer period [22] Company Strategy and Development Direction - The company is focusing on managing capacity growth to align with demand, planning to keep second-half capacity growth flat compared to last year [12] - A significant milestone was announced with a 10-year agreement with UPS for maintenance, repair, and overhaul services, supporting long-term revenue diversification [24] - The company aims to protect margins and cash flow while continuing to invest in customer experience and diversifying revenue streams [24][32] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a challenging macro environment with broad economic uncertainty affecting growth [10] - Despite the challenges, the company remains confident in its ability to deliver solid profitability and meaningful cash flow in 2025 [13][32] - Management emphasized the importance of monitoring demand closely and adjusting strategies accordingly [38][106] Other Important Information - The company repaid $530 million in debt, ending the quarter with gross leverage of 2.6 times [28] - Moody's upgraded Delta's credit rating during the quarter, marking the third upgrade in eight months [28] Q&A Session Summary Question: Context on guidance for the second quarter - Management is closely monitoring the impact of economic conditions on demand, particularly in the price-sensitive U.S. domestic market [36][37] Question: Capacity cuts and their timing - Capacity cuts will begin in August, particularly in the Southeast, as demand is expected to decline [46][47] Question: Performance of different demand cohorts - Premium travel has shown resilience, while Main Cabin demand is more challenged [50] Question: Corporate travel trends - Corporate travel remains flat year-over-year, with some sectors experiencing more significant impacts [102][106] Question: Impact of tariffs on aircraft deliveries - The company is working closely with Airbus to minimize tariff impacts on aircraft deliveries [113][114] Question: Booking trends and cancellations - Initial drop-off in bookings was short-lived, with sales rebounding above last year's levels [70][71] Question: International market performance - Canada has seen a significant drop in bookings, while Mexico's performance is mixed [96] Question: Risks and opportunities in the competitive environment - The company believes its strong brand and loyalty programs position it well against low-cost carriers [80][81]

Core Viewpoint - Delta Air Lines has withdrawn its full-year profit forecast and postponed planned capacity increases due to a weakening demand outlook amid recession concerns and escalating trade wars [1][2][3]. Financial Performance - Delta's first-quarter profits reached $240 million, an 18% increase compared to the previous year, with revenues rising by 2% to $14 billion [3]. - The company has projected second-quarter revenues to fluctuate between negative 2% and positive 2%, with earnings per share estimated between $1.70 and $2.30 [4]. Strategic Adjustments - Delta is adjusting its strategy by reducing the number of flights in response to a challenging consumer environment influenced by changing tariff dynamics [2][3]. - Plans to increase travel capacity in the second half of 2025 have been shelved, with expectations now set to remain flat compared to the previous year [3]. Market Reaction - Following the announcement, Delta's shares experienced a 7.5% increase in late-morning trading [4].

Core Viewpoint - Delta Air Lines reported first-quarter 2025 earnings of 46 cents per share, exceeding the Zacks Consensus Estimate of 40 cents, with a year-over-year increase of 2.2% attributed to low fuel costs [1] Financial Performance - Revenues for the quarter reached $14.04 billion, surpassing the Zacks Consensus Estimate of $13.81 billion, and reflecting a year-over-year increase of 2.1% [3] - Adjusted operating revenues, excluding third-party refinery sales, increased 3.3% year over year to $13 billion [3] - Passenger revenues, which constituted 81.8% of total revenues, rose 3% year over year to $11.48 billion, although this fell short of the estimate of $11.58 billion [5] - Cargo revenues improved 17% year over year to $208 million, exceeding the estimate of $185.4 million [6] - Total operating expenses increased 3% to $13.47 billion, with salaries and related costs rising 8% to $4.1 billion due to higher wages from a pilot contract ratified in 2023 [8] Capacity and Demand - To address weak demand, Delta reduced planned capacity growth in the second half of 2025 to flat year over year, aiming to protect margins and avoid fare reductions [4] - Domestic passenger revenues saw a marginal increase of 1% year over year, impacted by tariff-induced slowdown in domestic air travel demand, while international passenger revenues benefited from strong long-haul travel demand [5] Guidance and Outlook - Delta expects second-quarter 2025 adjusted earnings per share in the range of $1.7 to $2.3, with the Zacks Consensus Estimate currently at $2.62 per share [11] - The adjusted operating margin is anticipated to be between 11% and 14%, with revenues expected to either decline by 2% or increase by up to 2% year over year [11] Cash Position - At the end of the first quarter of 2025, Delta had cash and cash equivalents of $3.71 billion, down from $3.87 billion at the end of the first quarter of 2024 [9] - Adjusted net debt decreased by $1.1 billion to $16.9 billion at the end of the March quarter [9]

Core Viewpoint - Delta Air Lines reported earnings that were better than expected, providing a positive outlook for the airline sector, which saw stocks like Southwest Airlines rise initially [1][2]. Group 1: Earnings and Guidance - Delta Air Lines reset expectations last month, lowering guidance for Q1 and offering a cautious outlook for the future, but ultimately beat those lowered expectations [2]. - The airline withdrew its full-year guidance due to ongoing uncertainty in the economic environment [3]. Group 2: Market Reaction and Industry Impact - Delta is viewed as a well-managed company, and its comments helped boost investor confidence in other airlines, such as Southwest, which saw its stock rise [4]. - Despite the positive comments from Delta, the airline industry remains challenging, especially during economic slowdowns when consumers may prioritize essential purchases over travel [5]. Group 3: Investment Considerations - While Delta's outlook is encouraging, it may be premature to invest in airline stocks like Southwest based solely on hopes for recovery [6].

Trade War Impact - The trade war has escalated with a +50% increase in tariffs on Chinese imports to the U.S., and China retaliating with a +50% tariff on U.S. goods, raising tariffs on American goods to +84% in China and +104% on Chinese goods in the U.S. [1][2] Market Reactions - Pre-market trading shows significant declines: Dow down -850 points, S&P 500 down -95 points, and Nasdaq down -280 points. Spot oil prices have dropped to four-year lows, with WTI crude at approximately $56 per barrel. Bond yields are rising, with the 10-year at +4.46% and the 2-year at +3.82% [3]. Economic Indicators - Wholesale Inventories for February are expected to show moderated growth of +0.3%, down from +0.8% the previous month, indicating companies may have anticipated current trade turmoil [4]. - The minutes from the latest Federal Open Market Committee (FOMC) meeting will be released, with expectations of concerns regarding the economy affected by heavy tariffs [5]. Federal Reserve Projections - Market analysts have revised projections for Fed funds rate cuts from 1-2 expected in 2025 to 5, indicating anticipation of a major economic downturn due to prolonged tariff impacts [6]. Delta Air Lines Q1 Results - Delta Air Lines reported Q1 earnings of 46 cents per share, exceeding expectations of 40 cents, but revenues of $13.0 billion fell short of the $13.8 billion consensus [7]. - Guidance for the next quarter has been lowered, with expected earnings per share between $1.70-2.30 and revenues projected to change between -2% to +2% [8].

Trade War Impact - The U.S. has increased tariffs on Chinese imports by 50%, while China has reciprocated with a 50% tariff on U.S. goods, raising tariffs on American goods to 84% and on Chinese goods to 104% [1][2] - The ongoing trade war is expected to cause significant economic pain, with the potential to bring negotiators to the table, although the timeline for resolution remains uncertain [2] Market Reactions - Pre-market trading shows significant declines: Dow down 850 points, S&P 500 down 95 points, and Nasdaq down 280 points, indicating market distress due to the trade situation [3] - Spot oil prices have dropped to four-year lows, with WTI crude at approximately $56 per barrel, reflecting broader economic concerns [3] Economic Indicators - Wholesale inventories for February are expected to show moderated growth of 0.3%, down from 0.8% the previous month, suggesting companies may be adjusting to current trade conditions [4] - The minutes from the latest Federal Open Market Committee meeting will provide insights into Fed members' concerns regarding the economy affected by heavy tariffs [5] Federal Reserve Projections - Analysts have revised expectations for Fed funds rate cuts from 1-2 to 5 in 2025, indicating a forecast of a significant economic downturn likely due to prolonged tariff impacts [6] Delta Air Lines Q1 Results - Delta Air Lines reported Q1 earnings of 46 cents per share, exceeding expectations of 40 cents, although revenues of $13.0 billion fell short of the $13.8 billion consensus [7] - Guidance for the next quarter has been lowered, with expected earnings per share between $1.70-2.30, down from a previous estimate of $2.62, and revenues projected to change between -2% to +2% [8] - Despite the mixed results, Delta shares have seen a modest increase, likely due to the earnings beat and a year-to-date decline of 40% [8]

The airline cut growth plans for the second half of 2025, howeverDelta Air Lines Inc (NYSE:DAL) stock is up 6.8% to trade at $38.32 at last check, after the company shared better-than-expected first-quarter earnings of 46 cents per share and met revenue expectations. The airline cut growth plans for the second half of 2025 and did not reaffirm its annual outlook, however, citing fewer bookings and global tariff tensions.DAL is fresh off its worst weekly performance since March 2022, and carries a hefty 37.6 ...

View all Key Company Metrics for Delta here>>> Shares of Delta have returned -23.1% over the past month versus the Zacks S&P 500 composite's -13.5% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term. Passenger Load Factor: 81.4% compared to the 83.2% average estimate based on six analysts. Revenue passenger miles - Consolidated: 55.68 billion compared to the 56.83 billion average estimate based on five analysts. Available ...