Delta Air Lines Inc. reduced its expectations for Q3 profit on higher fuel prices and larger-than-expected maintenance costs, but it reaffirmed its full-year guidance on earnings. Adjusted profit will be $1.85 to $2.05 a share, compared with an earlier outlook for as much as $2.50, Delta said in a regulatory filing Thursday. It maintained its guidance for full-year profit of $6 to $7 per share. Delta joined other carriers in cutting profit and margin guidance on a 34% increase in jet fuel prices this quarter. US airline shares slumped the most since July on Wednesday after American Airlines Group Inc. and several discount carriers also said quarterly results would be below initial expectations because of higher costs and, in some cases, sagging domestic demand and fares. Delta shares fell 0.2% to $39.46 at 9:46 a.m. in New York trading. Delta has climbed 20% this year through Wednesday, the second-best performance in an S&P index of the five largest US carriers. Delta’s operating margin this quarter will be about 13%, compared with its earlier outlook for the mid-teens. Non-fuel unit costs, a gauge of efficiency, will climb as much as 2%, compared to earlier expectations that they would fall as much as 3%. Revenue for each seat flown a mile will decline as much as 3%, versus prior outlook for a dip of as much as 4%, and Delta said total sales would be in the upper half of its earlier expectation for an increase of as much as 14% from last year. While citing strong transatlantic travel demand, Delta said domestic trends are “steady.” <br/>
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Air France-KLM has begun a formal process to replace some of its aging widebody aircraft, seeking to pick up more fuel-efficient jets from Airbus or Boeing that can serve surging long-haul travel demand. The airline group is shopping for 30 to 50 widebody jets, according to people familiar with the matter. Bloomberg News reported in June that the company was considering replacements for its Airbus A330 jets that average 20 years, alongside a batch of two-decade old Boeing 777s. Airlines across the world are snapping up widebody jets as long-haul travel rebounds and stretches out waiting lists for newer, more fuel-efficient jets. The carrier has already retired its fleet of Boeing 747s and A380s and has added more modern 787 Dreamliners and Airbus’s A350 aircraft. Officials at Airbus and Air France-KLM declined to comment, while a Boeing spokesperson couldn’t immediately be reached for comment. Earlier this month Air France-KLM and Airbus announced plans for a proposed maintenance joint venture for the Airbus A350 aircraft, potentially giving Airbus some leverage in its talks with the Franco-Dutch airline. Part of the evaluation process includes the new reality of having to circumnavigate Russian airspace following the invasion of Ukraine. That detour can add several hours to a flight and changes the requirements for the aircraft, Air France KLM CEO Ben Smith said in June. <br/>