Delta Air Lines (DAL) has exceeded market expectations with its third-quarter earnings report. The company reported earnings of $2.03 per share, surpassing the projected $1.95 per share by analysts surveyed by FactSet. Revenue for the quarter stood at $14.6 billion, slightly higher than the anticipated $14.5 billion.
Positive Demand Outlook for Delta
Delta’s President, Glen Hauenstein, has expressed optimism regarding the airline’s demand outlook. He expects a growth rate of 9% to 12% in total revenue for the December 2022 quarter, indicating robust demand for travel on Delta.
This positive outlook is a relief, as concerns arose about the impact of the end of the peak summer travel season and inflationary pressures on consumers. However, Delta’s strong guidance is expected to positively influence its peers as well. United Airlines (UAL) stock has already gained 2.2% in premarket trading, while American Airlines shares have climbed 1.4%.
Stabilizing Fuel Costs
Apart from the encouraging demand outlook, Delta has also addressed concerns surrounding fuel costs. In recent months, the airline industry has been affected by a surge in oil prices and potential disruptions caused by geopolitical events.
Delta’s Chief Financial Officer, Dan Janki, stated that for the December quarter, they expect non-fuel unit costs to remain flat or increase by up to 2% year-over-year. This projection highlights Delta’s focus on achieving scale and efficiency while investing in its people and operational reliability.
Delta Air Lines continues to deliver solid financial results with an optimistic demand outlook and a strategy to manage fuel costs effectively. These factors, along with other positive developments, have contributed to a rise in the company’s stock value.