As trade tensions ripple through the economy, Delta Air Lines yanked its full-year guidance on Wednesday. CNBC sees it as a big "shift" for the country's most profitable airline, which had initially expected the "best financial year in our history." In March it trimmed its Q1 outlook, and on Wednesday it said in a statement that "given the lack of economic clarity, it is premature at this time to provide an updated full-year outlook," reports Investing.com. Two key quotes from CEO Ed Bastian:
- From the AP: "With broad economic uncertainty around global trade, growth has largely stalled. In this slower-growth environment, we are protecting margins and cash flow by focusing on what we can control. This includes reducing planned capacity growth in the second half of the year to flat over last year while actively managing costs and capital expenditures."
- From Yahoo Finance: "The level of uncertainty that we're facing coming out of the global trade discussions and skirmishes is a bit unprecedented. Our bookings are pretty good. They have a pretty good line of sight for the next 60 to 90 days, but beyond that, it's a bit murky. And it would not be responsible to try to give an estimate in light of such uncertainty."
The airline earned $240 million in the first quarter, equating to 37 cents per share, up from $37 million or 6 cents per share last year. Operating revenue increased to $14.04 billion, beating Wall Street's estimate of $13.81 billion. The average fuel price per gallon fell to $2.47 from $2.79. Bastian said June quarter profits are expected to be in the $1.5 billion to $2 billion range but didn't provide an updated full-year outlook "given the lack of economic clarity." Delta had originally anticipated strong travel demand for the year and resulting annual earnings in excess of $7.35 per share. (This content was created with the help of AI. Read our AI policy.)
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