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How about this for a recession indicator…Delta Air Lines is doing well?
Last year, Delta Air Lines was struggling with half-empty domestic flights, but it recently cut its summer flight schedules, and profits seem to have rebounded. So fewer flights = more money, but we can already feel how crowded those planes could be.
The Atlanta-based airline saw a record second quarter with $15.5 billion in revenue, a 1% increase from 2024. The airline overperformed analyst expectations, with $2.13 billion in profit, a 63% increase compared to last year. It was also able to keep non-fuel costs in the single digits and expects to do the same for the rest of the year.
A key revenue driver for Delta was the rise in premium seat sales, which jumped 5%, even as main cabin seat sales fell by the same amount. Some customers appear to be splurging on vacations while more price-sensitive ones are switching to driving or forgoing summer vacations this year.
As tariff confusion has eased and consumers have adjusted to ongoing uncertainty, Delta said it could now offer guidance for its September quarter—projecting earnings of $5.25 to $6.25 per share, down from its January forecast of $7.35.
“For the September quarter, we expect total revenue to be flat to up 4% compared to the prior year, with unit revenue trends expected to improve through the second half of the year as we continue to adjust capacity and the industry further rationalizes supply,” Glen Hauenstein, Delta Air Lines president said, indicating that more routes could be cut as travel demand has softened to a lower level than expected.