Delta Air Lines takes $7B loss as coronavirus grounds flights
The airline warned business won't return to normal for over 2 years
Delta Air Lines Inc. booked $3.2 billion in costs due to disruptions caused by COVID-19 during the three months through June and said business will take years to mount a sustainable recovery.
The Atlanta-based air carrier lost $3.86 billion before taxes and other items, or $4.43 per share, as total revenue plunged 88 percent from a year ago to $1.47 billion. Wall Street analysts surveyed by Refinitiv were anticipating an adjusted loss of $4.07 a share on revenue of $1.42 billion.
Disruptions caused by COVID-19 resulted in a 94 percent drop in passenger revenue and an 85 percent reduction in capacity. Non-ticket revenue was down 65 percent.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| DAL | DELTA AIR LINES INC. | 47.85 | -0.03 | -0.06% |
The results illustrate the “truly staggering impact of the COVID-19 pandemic on our business,” CEO Ed Bastian said in a statement. “Given the combined effects of the pandemic and associated financial impact on the global economy, we continue to believe that it will be more than two years before we see a sustainable recovery.”
Delta reduced its late March cash burn by 70 percent to $27 million in June. The carrier finished the second quarter with $15.7 billion of liquidity.
The company expects to be a smaller, more efficient airline coming out of the crisis, with plans to speed up fleet retirements, accelerate airport construction programs while demand is lower and implement voluntary separation and early retirement programs.
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Delta shares were down 54 percent this year through Monday, lagging the S&P 500's 2.34 percent decline.