HomeIndustriesDelta Beats Profit Estimate as Travel Industry Rebounds

Delta Beats Profit Estimate as Travel Industry Rebounds

Delta Air Lines Inc shares fell by 4.2% during premarket trading after the company announced on Friday that it has forecast current-quarter profit below expectations after incurring higher operating costs this past quarter.

Although the fourth quarter saw a stark rise in travel demand during the busy holiday season, the U.S. carrier acknowledged that its rising expenses would impact its profit margins, still, Delta’s profit for December exceeded expectations. While the company forecast a profit of $1.33 per share for the month, Delta’s profit came to $1.48 per share, with the airline’s adjusted revenue standing at $12.3 billion for the year.

U.S. airlines are expecting a strong financial performance going into the new year as consumer demand shows several signs of growth, including a strengthening dollar, the reopening of international borders following the end of the pandemic, and a rise in business travel.

“As we move into 2023, the industry backdrop for air travel remains favorable and Delta is well positioned to deliver significant earnings and free cash flow growth,” Delta Air Lines CEO Ed Bastian stated.

Delta expects consumers to spend $30 billion on travel this year, with no sign of travel slowdowns in sight.

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