Delta Air Lines misses on revenue

Delta Air Lines reported mixed third-quarter results, sending shares lower in premarket trading.

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TickerSecurityLastChangeChange %
DALDELTA AIR LINES INC.53.64+0.65+1.23%

The airline reported earnings of $2.31 a share, topping the $2.26 IBES consensus. Revenue rose 5 percent versus a year ago to $12.56 billion, missing the $12.6 billion that was expected. Delta said net income surged 21 percent year-over-year to $1.5 billion. Results were not impacted by the grounding of the 737 Max as Delta does not fly the aircraft.

“Increased customer satisfaction is driving solid top-line performance -- September quarter revenues grew to a record $12.6 billion and we expect December quarter revenues to grow more than five percent versus prior year," Delta President Glen Hauenstein said in a press release. "Strong demand and our customer-focused commercial initiatives are putting us on track to achieve a $3 billion increase in revenues this year, a pace of growth well in excess of GDP."

The consolidated operating cost per available seat mile fell 2.1 percent from September 2018, mostly due to lower fuel costs and higher capacity. Higher employee costs, record passenger volumes and weather led to a 2.4 percent year-over-year increase in non-fuel unit costs.

During the third quarter, Delta returned $468 million to shareholders through share repurchases ($208 million) and dividends ($260 million).

Looking ahead, Delta sees fourth-quarter earnings of between $1.20 and $1.50 a share, below the $1.51 Refinitiv estimate.

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Delta shares were up 8 percent this year through Wednesday.