Delta Q3 Earnings & Revenues Top on Rosy Travel Demand, Low Fuel Costs

Core Insights - Delta Air Lines (DAL) reported Q3 2025 earnings of $1.71 per share, exceeding the Zacks Consensus Estimate of $1.52, with a year-over-year increase of 14% attributed to low fuel costs [1][10] - Revenues for the quarter reached $16.67 billion, surpassing the Zacks Consensus Estimate of $15.79 billion, marking a 6.4% year-over-year growth [2][10] Revenue Breakdown - Passenger revenues, which constituted 81% of total revenues, rose 3% year-over-year to $13.51 billion, slightly below the estimate of $13.55 billion [3] - Premium revenues increased by 9% year-over-year, with loyalty revenues also up by 9%, reflecting strong engagement from SkyMiles members [4] - Cargo revenues improved by 19% year-over-year to $233 million, exceeding the estimate of $203.4 million, while other revenues surged 24% to $2.9 billion, surpassing the estimate of $2.4 billion [4] Operational Metrics - Adjusted operating margin for Q3 2025 was 11.2%, up from 9.4% a year ago [5] - Revenue passenger miles increased by 2% to 67.2 billion, while capacity expanded by 4% to 79 billion [5] - Load factor decreased by 100 basis points to 86%, slightly below the estimate of 86.1% [5] Cost and Expenses - Total operating expenses rose by 5% to $15 billion, with salaries and related costs increasing by 5% to $4.4 billion due to higher wages from a new pilot contract [7] - Fuel gallons consumed increased by 4% to 1.114 billion, while the average fuel price per gallon fell by 11% to $2.25 [7] Cash Flow and Debt - At the end of Q3 2025, DAL had cash and cash equivalents of $3.8 billion, down from $3.97 billion a year earlier [8] - Adjusted net debt decreased by $2.4 billion to $15.6 billion, with adjusted operating cash flow of $1.8 billion [8] Future Guidance - DAL expects Q4 2025 adjusted earnings per share to be in the range of $1.6 to $1.9, with the Zacks Consensus Estimate at $1.52 [9][10] - Full-year earnings guidance is approximately $6 per share, above the Zacks Consensus Estimate of $5.67, with free cash flow expected to be between $3.5 billion and $4 billion [11]