Core Viewpoint - Delta Air Lines has withdrawn its full-year profit forecast and postponed planned capacity increases due to a weakening demand outlook amid recession concerns and escalating trade wars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 ...

About this content About Emily Jarvie Emily began her career as a political journalist for Australian Community Media in Hobart, Tasmania. After she relocated to Toronto, Canada, she reported on business, legal, and scientific developments in the emerging psychedelics sector before joining Proactive in 2022. She brings a strong journalism background with her work featured in newspapers, magazines, and digital publications across Australia, Europe, and North America, including The Examiner, The Advocate, ...

Delta Air Lines CEO Ed Bastian said President Trump was taking "the wrong approach" with tariffs as the carrier pulled its financial forecast for 2025 and scaled back expansion plans for later this year. The Atlanta-based airline, the second largest domestic carrier, said on Wednesday that it will halt previously planned flight expansions for the second half of 2025 — attributing the decision to weakening bookings and economic uncertainties arising from Trump's shifting trade policies. "With broad economic ...

Delta Air Lines posted solid earnings for Q1 2025, surpassing analyst EPS estimates, though it fell short of management's ambitious projections. Operating margin was impacted, standing at 4.6%, below the 6% to 8% guidance. This signals cost pressures and softer domestic demand, affecting revenue per seat mile, an important industry metric that assesses efficiency in generating passenger revenue. Total revenue per available seat mile of 20.53 cents fell 2% year over year. On the strategic front, Delta contin ...