TLDR
- Delta Air Lines reported Q3 adjusted EPS of $1.71, beating analyst expectations of $1.56, while revenue hit $15.197 billion versus the $15.08 billion estimate.
- Full-year EPS guidance increased to $6, up from the prior range of $5.25 to $6.25 and above the $5.80 analyst consensus.
- Premium revenue climbed 9% and corporate sales jumped 8% in the third quarter as business travel demand strengthened.
- The carrier expects Q4 operating margin between 10.5% and 12%, targeting its most profitable fourth quarter ever.
- Delta shares surged over 6% premarket, pulling United Airlines, American Airlines, and Southwest Airlines higher by 2% to 5%.
Delta Air Lines posted third quarter results Thursday that exceeded Wall Street forecasts. The performance triggered gains across the airline sector.
The carrier reported adjusted earnings per share of $1.71 for the quarter. Analysts expected $1.56. Revenue came in at $15.197 billion, topping estimates of $15.08 billion.
Delta stock jumped more than 6% before the market opened. Competitors followed, with United Airlines, American Airlines, and Southwest Airlines rising between 2% and 5%.
CEO Ed Bastian credited improving business conditions after a difficult first half. Tariff announcements and geopolitical uncertainty had slowed corporate spending earlier in the year.
“In the third quarter, things picked right back up again,” Bastian said. The recovery prompted Delta to raise its annual earnings forecast.
The company now projects full-year adjusted EPS of about $6. That’s up from its previous range of $5.25 to $6.25. The new guidance beats analyst estimates of $5.80.
Free cash flow guidance also increased to $3.5 billion to $4 billion from $3 billion to $4 billion previously.
Premium Cabins and Business Travel Power Results
Premium travel delivered strong growth for Delta in Q3. Revenue from Comfort Plus and Delta One cabins rose 9% year-over-year.
Corporate sales increased 8% during the quarter. Delta surveys show 90% of companies expect travel volume to stay steady or increase in 2026.
“Our consumer is a high-end consumer. It’s a premium consumer,” Bastian explained. These travelers have both the means and desire to fly.
The SkyMiles loyalty program generated 9% revenue growth. American Express card remuneration reached $2 billion, up 12%. Co-branded credit card spending grew by double digits.
Bastian wasn’t surprised by the premium segment’s performance. The trend has continued for several years since the pandemic ended.
Fourth Quarter Outlook and Recent Performance
Delta forecasts Q4 operating margin of 10.5% to 12%. Revenue should grow 2% to 4%.
The carrier expects adjusted EPS between $1.60 and $1.90 for the fourth quarter. Bastian said Delta is on track for its best Q4 profit ever.
“We’re looking at for the fourth quarter a comparable amount of growth,” the CEO noted. Sales momentum has built across all regions over the past six weeks.
Domestic revenue rose 5% in Q3. Total adjusted revenue per available seat mile hit $0.19, up 0.3% from last year.
The comparison benefited slightly from last year’s CrowdStrike outage that disrupted operations. This created an easier benchmark for 2025 results.
Bastian highlighted improved business confidence. He pointed to new trade agreements between the US and trading partners as a positive factor.
The government shutdown raised questions about air traffic control. Nashville saw delays this week due to controller shortages. Burbank operated without controllers for several hours.
“In the first week of October, we completed 99.99% of our schedule,” Bastian said. System-wide on-time performance reached 90%.
He cautioned that extended shutdown effects could create problems. “If this thing continues, I’d say beyond next week, it’s going to probably be a bigger source of concern.”
Delta shares had declined 4% to 5.6% year-to-date through Wednesday. The Q3 beat positions the stock to turn positive for 2025.
The airline started its centennial year projecting full-year EPS above $7.35. It withdrew guidance in April after tariffs impacted demand. Delta restored guidance in July at $5.25 to $6.25 before raising it again Thursday to $6.
