Delta Air Lines reported robust third-quarter results, with adjusted EPS of $1.71 and revenue of $15.2 billion, both exceeding analyst expectations, largely driven by a 9% increase in premium travel revenue. The airline issued an optimistic outlook, forecasting fourth-quarter adjusted EPS of $1.60-$1.90 and revenue growth up to 4%, surpassing Wall Street estimates, and reiterated its full-year 2025 adjusted EPS at the upper end of its guidance at $6. This positive forecast, attributed to resilient luxury travel demand and rising airfares, signals an improving supply-demand balance and positions Delta for continued top-line growth and margin expansion into 2026.
Delta Air Lines forecast a better-than-expected end to 2025 thanks to rising airfares and resilient luxury travel demand. The airline on Thursday projected adjusted earnings of between $1.60 and $1.90 a share for the fourth quarter, compared with the $1.65 per share analysts polled by LSEG were expecting. Revenue in the last three months of the year will grow as much as 4%, Delta said, above the 1.7% Wall Street expects. "Looking to 2026, Delta is well positioned to deliver top-line growth, margin expansion and earnings improvement consistent with our long-term financial framework," CEO Ed Bastian said in an earnings release. Delta shares were up more than 5% in premarket trading. Here's how the company performed in the three months ended Sept. 30, compared with what Wall Street was expecting, based on consensus estimates from LSEG: - Earnings per share: $1.71 adjusted vs. $1.53 expected - Revenue: $15.2 billion adjusted vs. $15.06 billion expected Delta's outlook points to improved demand and less of a surplus of flights that pushed domestic fares and revenue down at airlines this year, particularly early in 2025 when consumer confidence was rattled in the early stages of President Donald Trump's tariffs. The Atlanta-based carrier is the first of the major airlines to report results this quarter. "Starting in July, cash sales picked up," Bastian said in an interview. Delta's third-quarter profit rose 11% to $1.42 billion, or $2.17 a share, up from $1.27 billion, or $1.97 a share, a year earlier. Adjusting for one-time items, including investment-related adjustments, its profit rose 15% to $1.12 billion, or $1.71 a share, ahead of analyst estimates. Adjusted revenue rose 4% year over year. Premium-travel demand continued to outshine the coach cabin. Revenue from the high-end segment, which includes first class and roomier economy seats, increased 9% in the third quarter to nearly $5.8 billion, while main cabin revenue fell 4% to about $6 billion. Bastian said there were no signs of a consumer pullback for premium products. Delta and other carriers have culled unprofitable or less profitable flights such as those during unpopular midweek travel days to help stem an oversupply of seats in the market. That surplus of capacity along with shifting consumer habits and higher costs has made previously slam-dunk summer profits more elusive for some U.S. carriers. Domestic unit revenue rose 2% in the third quarter at the carrier on a 4% increase in capacity, and Delta forecast it would remain positive year-over-year in the current quarter. Stronger corporate travel demand helped to drive a 5% increase in overall domestic passenger revenue in the third quarter. Delta said it expects adjusted, full-year earnings per share of $6, at the upper end of the $5.25 to $6.25 it forecast for 2025 in July. When asked about the federal government shutdown, Bastian said the airline hasn't seen "any impacts at all" to its operation in recent days. Delta Air Lines reported robust third-quarter results, surpassing analyst expectations with adjusted EPS of $1.71 against a $1.53 consensus and revenue of $15.2 billion versus $15.06 billion expected. This strong performance underpinned an optimistic outlook, as the airline forecast Q4 adjusted earnings between $1.60 and $1.90 per share, exceeding the $1.65 LSEG estimate, and revenue growth up to 4%, above Wall Street's 1.7% projection. Furthermore, Delta raised its full-year 2025 adjusted EPS guidance to $6, positioning it at the upper end of its previously stated $5.25-$6.25 range. The market reacted positively, with shares up over 5% in premarket trading. The positive performance was primarily driven by resilient luxury travel demand and rising airfares, with premium-travel revenue increasing 9% to nearly $5.8 billion in Q3, significantly outperforming a 4% decline in main cabin revenue. Stronger corporate travel demand also contributed, leading to a 5% increase in overall domestic passenger revenue. CEO Ed Bastian indicated no signs of consumer pullback in premium products, supporting sustained demand in this high-margin segment. Delta's strategic culling of unprofitable flights appears to be addressing the prior oversupply of seats, contributing to improved domestic unit revenue, which rose 2% in Q3 on a 4% capacity increase and is expected to remain positive year-over-year in the current quarter. This disciplined capacity management, coupled with a favorable demand environment, positions Delta for continued "top-line growth, margin expansion and earnings improvement" into 2026, consistent with its long-term financial framework.
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