Delta delivered its highest quarterly revenue and profitability in the airline’s history, with strong June quarter operating cash flow enabling accelerated debt reduction.
The airlines recorded operating revenue of $14.6 billion, 19 percent higher than the June quarter 2022 and recorded operating income of $2.5 billion with an operating margin of 17.1 percent.
The airline also recorded pre-tax income of $2.2 billion with a pre-tax margin of 15.2 percent. The carrier’s earnings per share was $2.68 with operating cash flow of $2.6 billion and free cash flow of $1.1 billion.
The airline’s adjusted net debt was $19.8 billion at quarter end.
“Thanks to the incredible work of our entire team, Delta is delivering for our customers by providing strong operational performance and best in class service during this busy summer period,” said Ed Bastian, Delta’s chief executive officer.
“With this performance, we generated record revenue and profitability in the June quarter. Our people are the best professionals in the industry, and I’m proud to recognize their achievements with $667 million in the first half toward next year’s profit-sharing payment,” he said.
“Consumer demand for air travel remains robust. Against this constructive backdrop, we are increasing our 2023 earnings guidance to $6 to $7 per share and reiterating our recently updated outlook for $3 billion of free cash flow.”
The airline recorded operating revenue of $15.6 billion and operating income of $2.5 billion with an operating margin of 16.0 percent.
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The airline’s pre-tax income is $2.3 billion with a pre-tax margin of 14.9 percent. The airline also recorded earnings per share of $2.84 and operating cash flow of $2.6 billion.
The airline’s payments on debt and finance lease obligations is $1.8 billion and total debt and finance lease obligations stood at $20.2 billion at quarter end.
The carrier implemented the largest-ever transatlantic summer schedule in its history this summer. The airline offers over 650 weekly flights to 32 destinations this year, a 20 percent increase in seat capacity versus summer 2022. International passenger revenue was 61 percent higher year over year, with southern European destinations leading results.
There have also been several new partnerships contributing to this success. Delta and LATAM began a joint venture, bringing routes from the US to Colombia and LATAM’s first Atlanta route. Across the ocean, Delta signed an agreement with EL AL Israel Airlines to launch a strategic partnership offering more convenient customer connections alongside reciprocal codeshare and frequent flyer benefits.
The carrier’s frequent flyer program, SkyMiles, welcomed over 3 million new members, marking the second consecutive record quarter. Its existing credit card partnership with American Express brought in $1.7 billion from increasing premium card acquisitions, up 20 percent more than the same quarter in 2022.
In terms of aircraft, Delta took delivery of 18 plans so far this year and 12 in this quarter. The deliveries included the Airbus A321neo, A220-300, and A330-900. The carrier further exercised its option to purchase 12 additional A220s and added one A330-900 to its order book.
Another contributing factor was accelerated day repayment. Delta aims to retire over $4 billion in debt this year. It declared a net debt of $19.8 billion at the end of the June quarter, down $2.5 billion from December. The carrier also reinstated its quarterly dividend this past quarter, an important milestone for investors.
