Delta expects profit boost from growing travel demand

Delta Air Lines has said it expects record profits this year as air travel booms and passengers are increasingly willing to pay for premium seats. The airline expects adjusted pre-tax profits to rise to $6bn in 2025, compared with $5.2bn in the year prior, CE Ed Bastian said. It anticipates earning $7.35 or more per share, up from the $6.16 per share it earned last year. The new year looked “relatively positive” for the big four US airlines, said Fitch Ratings analyst Joseph Rohlena. “It feels like we’re in a normal-slash-healthy environment after a lot of pandemic noise,” he added. Glen Hauenstein, Delta’s president, said demand was being driven by both leisure and corporate passengers, with Baby Boomers preferring first- and business-class seats. While some US carriers struggled last year as an abundance of seats and flights in the domestic market dragged on fares, airlines cut flights and reduced seat availability in the second half of the year. Last month, several airlines raised fourth-quarter guidance, including American Airlines and Southwest Airlines, two of the four largest US airlines. Delta’s revenue totalled $57bn last year, building momentum as the year drew to a close, and revenue growth from seats at the front of the plane outpaced the main cabin, Hauenstein said. Both corporate travel and transatlantic flights helped fuel sales. Tickets sold to big corporate accounts increased 10% in the fourth quarter of 2024 compared with the same period a year earlier, driven by companies in tech and financial services. Transatlantic travel between October and December also grew 4% compared with the fourth quarter of 2023, to $2bn. Raymond James analyst Savanthi Syth noted the strength of the US dollar was likely to continue to support demand for international travel outbound from the US in 2025, benefiting carriers with well-developed transatlantic routes such as United Airlines and Delta.<br/>