Delta cuts profit guidance after computer crash

Delta Wednesday cut its profitability guidance for the third quarter after a computer system crash at the leading US airline last month caused chaos, forcing it to cancel about 2,300 flights. Paul Jacobson, Delta’s CFO, told a conference the airline expects operating profit margins to fall to between 18 and 19% in the three months to September 30, compared with a previous forecast of 19 to 21%. Other US airlines have encountered information technology problems this year that disrupted flights, and Mr Jacobson stressed Delta was seeking to avoid a repeat of its IT outage, which caused widespread problems for the carrier’s booking, check-in and flight systems. “It becomes a complete tragedy if we don’t use it as a learning experience,” said Jacobson, adding “we like to think of ourselves as an industrial transportation company but we are every bit as much a technology company as well and the reliability of the systems has to match that”. Jacobson said the knock-on effects of the IT outage would cut Delta’s pre-tax income by $150m in Q3.<br/>