Earnings Results: Delta’s stock climbs as profit beats expectation, sees more ‘robust demand’

Shares of Delta Air Lines Inc. rallied Thursday, after the air carrier reported third-quarter profit that beat expectations, and said the “robust demand” for travel it has been seeing has continued into the current quarter.

While overall adjusted revenue was in line with expectations, September revenue rose to a record for the month, leading Delta to boost its full-year growth outlook.

The stock
DAL,
-2.15%

rose 2.2% in premarket trading, to put it on track for a third-straight gain. The bounce comes after the stock closed at a five-month low of $35.24 on Oct. 3.

Net income rose to $1.11 billion, or $1.72 a share, from $695 million, or $1.08 a share, in the year-ago period. Adjusted earnings per share, which excludes nonrecurring items, rose to $2.03 from $1.51 to beat the FactSet consensus of $1.95.

Revenue grew 10.8% to $15.49 billion, while adjusted revenue increased 13% to $14.55 billion to match expectations.

Domestic passenger revenue increased 6% to $8.66 billion, while international revenue jumped 35%, including 34% growth in transatlantic revenue.

Load factor improved to 88% from 87% to top expectations of 86.4%, as traffic increased 17% to 64.1 billion revenue passenger miles and capacity rose 16% to 73.2 billion available seat miles.

For 2023, Delta cut its EPS guidance range to $6.00 to $6.25 from $6 to $7, but raised its sales growth outlook to approximately 20% from 17% to 20%.

Delta’s stock has tumbled 25.0% over the past three months through Wednesday, while the U.S. Global Jets ETF
JETS,
-2.53%

has shed 24.5% and the S&P 500 index
SPX,
-0.86%

has slipped 2.1%.

source

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