Shares of Delta Air Lines (DAL) jumped on Friday after the country’s second-largest airline reported stronger-than-expected fourth-quarter earnings.
“As we move into 2025, we expect strong demand for travel to continue, with consumers increasingly seeking the premium products and experiences that Delta provides,” Chief Executive Ed Bastian said in a statement.
In Q4 Delta earned $1.29 a share, down 59% from $3.16 in the year-earlier quarter. Adjusted profit for the period rose 45% to $1.85 a share from $1.28. Revenue on a GAAP basis rose 9.4% to $15.56 billion.
The consensus estimate of analysts surveyed by FactSet was 77 cents a share.
Delta Air Lines sees Q1 2025 revenue rising as fuel costs drop and demand is strong for premium seats.
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Bastian and Chief Financial Officer Dan Janki told investors that they expected earnings to range 70 cents to $1 a share in the first quarter. The airline estimates a first-quarter revenue increase of 7% to 9%, bolstered largely by a drop in fuel costs and heightened demand for high-end travel and products such as premium economy.
Delta sees higher full-year profit
For 2025 the carrier expects to earn more than $7.35 a share. The company said that’s “more than 10% growth year-over-year compared to a normalized 2024 earnings per share baseline, excluding the 45-cent impact of the CrowdStrike-caused outage in the September quarter.”
Delta said it expected to generate more than $4 billion of free cash this year. Free cash flow in 2024 was $3.4 billion.
At last check Delta Air stock was almost 10% higher at $67.50.
Related: Analyst says Delta Air Lines stock is (relatively) safe again
“Demand accelerated through the [fourth] quarter,” Delta said, adding that during November and December, the carrier “saw four of the top 10 revenue days in the company’s history.”
Fourth-quarter fuel expense fell 18% to $2.41 billion from $2.94 billion. The airline’s revenue from premium tickets grew 6 percentage points more than revenue from seats in the main cabin.
Janki said in a statement that for all of 2025, “[we] expect non-fuel unit-cost growth to continue in the low-single digits … as efficiencies offset the impact of slower capacity growth and continued investments in our people and the customer experience.”
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Delta Air results might be industry bellwether
If Delta’s promises for 2025 revenue and profit pan out, the airline could have what its executives say will be the best financial year in its history right as the airline prepares to mark its 100-year anniversary. Delta was founded in 1925 and operated its first passenger flight from Texas to Mississippi in 1928.)
Delta was the first major airline to report fourth-quarter earnings so far in what could be a bellwether of a strong season for the aviation industry even as smaller airlines such as Spirit (SAVE) struggle to implement turnaround plans.
Competitor American Airlines (AAL) has also been putting its focus on corporate and other high-earning travelers after finding that its previous sales and distribution strategy of purely targeting passenger numbers with discounts failed to pan out.
American struggled to bring in customers who had no reason to choose it over many other airlines flying the same routes. It instead was forced to “take swift and aggressive action to reorient” toward winning over passengers.
Related: Veteran fund manager issues dire S&P 500 warning for 2025
