A Delta Air Lines aircraft in an Atlanta airline hangar
Leslie Josephs/CNBC
Delta Air Lines On Wednesday, it said sales would grow in 2025, citing a “resilient economy” and strong travel demand and credit card spending, especially on high-end products. The company also said it expects earnings to grow in the coming years.
Delta expects revenue to grow by mid-single-digit percentage points next year compared with 2024, in line with analysts’ forecasts of about 6% growth.
In an investor day presentation, the airline said it would increase the number of flights next year by 3% to 4%, starting in 2024. Fourth quarter outlook. Longer term, the company said it expects adjusted earnings to grow 10% annually over the next three to five years.
Delta Air Lines is the most profitable airline in the United States, and its leaders vigorously promote and American Express As part of its success, demand for expensive seats at the front of the plane was high. United AirlinesHowever, there are Profit growth makes progress and attract high-end travelers. As of Tuesday’s close, Delta Air Lines’ shares are up 60% this year, while United Airlines’ shares are up 128%. Both outperformed the wider market and other operators.
Delta said only 43% of its revenue this year came from economy class tickets, with 57% coming from premium seats and its lucrative loyalty program. This is up from 60% of main cabin revenue in 2010.
The airline has spent years trying to get customers to pay for first class, and in the past few years it has largely abandoned first-class seats.
Delta President Glen Hauenstein told reporters that about 15 years ago, about 12% of Delta’s first-class seats were paid and the rest were frequent flyer upgrades. Now, more than 70% of seats are purchased, including seats purchased after reservation. He said the change would be “painful” for some travelers at first.
Hauenstein said Delta is looking for new ways to divide its cabins after it and its rivals spent years dividing economy into options such as premium economy, extra legroom seats and basic economy. . Hauenstein said that while it did not provide details, it is also considering more options for travelers sitting in the front of the plane.
In the speech, the airline’s top brass is likely to face questions about future demand, controlling costs and the steps the airline is taking to avoid another dramatic fallout from the pandemic. mass strike There was a power outage last July.
