Delta Expects Strong Profit Despite Higher Fuel Costs
The New York Times • • general
Key Points:
- Delta Air Lines plans to spend an additional $2 billion on fuel in the second quarter due to sharply increased jet fuel prices driven by the war with Iran, but still expects to earn a sizable profit.
- To offset higher fuel costs, Delta will cut about 3.5% of its flights in the second quarter, reversing earlier growth plans, and increase fares and fees to recover up to half of the extra expenses.
- The airline forecasts a pre-tax profit of about $1 billion for the quarter with revenues expected to rise at least 10% year-over-year, reflecting strong demand despite higher ticket prices.
- Delta reported $15.9 billion in revenue for the first quarter, with particularly strong sales of premium seats and credit card spending, though it posted a small quarterly loss of $289 million.
- The recent cease-fire agreement with Iran may lead to lower crude oil and jet fuel prices, but the exact impact on Delta and other airlines remains uncertain.
