Delta reports better-than-expected Q1 earnings, surges as oil plummets
Delta Air Lines reported its first-quarter results before markets opened on Wednesday. The carrier’s shares surged 12% in premarket trading.
Delta, which as of today will charge passengers $10 more per checked bag, reported:
Adjusted earnings of $0.64 per share, compared to the $0.58 per share expected by analysts polled by FactSet.
Adjusted operating revenue of $14.2 billion, compared to estimates of $14 billion.
Looking ahead, Delta said it expects Q2 earnings per share of between $1 and $1.50, below Wall Street estimates of $1.56 per share — which might be enough to disappoint investors if oil, one of the largest inputs for an airline’s fuel cost base, wasn’t tanking. Indeed, West Texas Intermediate crude futures are down more than 16% on Wednesday morning, following President Trump’s comments that he agreed to a two-week ceasefire with Iran on Tuesday evening. Delta did not give any full-year earnings guidance in its press release.
Like other carriers, Delta has taken a hit in recent weeks as oil — and jet fuel — prices spike amid the war in Iran. Significant delays, cancellations, and rebookings have also battered US airlines.
Delta, which is becoming an increasingly K-shaped airline, saw premium tickets grow 14% year over year in the first quarter, compared to 1% growth in main cabin tickets.
