MW Delta Air Lines sees growth stall as trade friction fuels worries about the economy

By Tomi Kilgore

Stock bounces off a 17-month low, as profit missed expectations, but the outlook was mostly in line with forecasts

Shares of Delta Air Lines Inc. were headed for a nice bounce in early Wednesday trading, after the air carrier missed first-quarter profit expectations but provided an outlook that was mostly in line with forecasts.

"With broad economic uncertainty around global trade, growth has largely stalled," said Chief Executive Ed Bastian.

In the slower-growth environment, Bastian said Delta will focus on protecting margins and profitability by cutting back on capacity, or seat supply, in the second half of the year and reducing costs and spending.

The stock $(DAL)$ climbed 2.5% in premarket trading. It had tumbled 17.3% over the past four sessions, in the wake of President Donald Trump's tariff announcement, to close Tuesday at the lowest price since November 2023.

Read: Airline stocks take a beating as tariffs spark fears of a 'touristic' slowdown.

First-quarter net income rose to $240 million, or 37 cents a share, from $37 million, or 6 cents a share, in the same period a year ago. That missed the FactSet consensus for earnings per share of 38 cents.

Load factor fell to 81.4% from 82.7%, below the FactSet consensus of 82.2%, as traffic increased 2.7% while capacity rose 4.4%.

Total revenue grew 2.1% to $14.04 billion, above the FactSet consensus of $13.85 billion.

Passenger revenue increased 3.1% to $11.48 billion to top expectations of $11.44 billion, while cargo revenue jumped 16.9% to $208 million and "other" revenue declined 3.6% to $2.35 billion.

Because of the "lack of economic clarity," Bastian said it's too soon to provide a full-year outlook of operations. But with the help of lower fuel prices, he still expects Delta to deliver "solid profitability" that he believes will lead the airline industry.

For the current second quarter, Delta expects EPS of $1.70 to $2.30, which compares with the current FactSet consensus of $2.21.

Delta also projects second-quarter total revenue to be down 2% to up 2% from a year ago, while the current FactSet revenue consensus of $16.58 implies a 0.5% decline.

Delta's stock has plunged 40.7% in 2025 through Tuesday, while the U.S. Global Jets ETF JETS has slumped 31.5% and the S&P 500 index SPX has dropped 15.3%.

-Tomi Kilgore

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April 09, 2025 07:31 ET (11:31 GMT)

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