Delta Sees $6.50-$7.50 EPS in Reach as Higher Airfares Persist
Updated
Updated · CNBC · Jul 10
Delta Sees $6.50-$7.50 EPS in Reach as Higher Airfares Persist
3 articles · Updated · CNBC · Jul 10
Summary
Delta reaffirmed its full-year earnings forecast of $6.50 to $7.50 a share, with CEO Ed Bastian saying that target remains achievable as the airline keeps raising fares.
About 60% of Delta's higher fuel bill has already been passed to customers, Bastian said, and that figure should approach 100% this quarter because demand remains strong and carriers are restraining capacity.
Second-quarter adjusted earnings beat expectations at $1.56 a share on $17.67 billion in revenue, while Delta projected third-quarter earnings of $2.00 to $2.50 a share and mid-teens revenue growth.
Premium demand helped support that pricing power: first-class and other premium seat revenue reached $6.92 billion, topping main-cabin revenue of $6.85 billion, while corporate travel also rose.
Even with net income down 25% to $1.6 billion, Delta said industry discipline, stronger World Cup travel and diversified revenue streams should help keep fares elevated even as oil retreats from recent highs.