Delta Airlines records $13.8bn operating revenue in Q2

Delta Airlines has recorded a sum of $13.8 billion as operating revenue for the second quarter of the year 2022.

Data sourced from the firm’s latest financial report showed Delta Airlines recorded an operating income of $1.5 billion, operating margin of 11.0 percent, earnings per share of $1.15, operating cash flow of $2.5 billion and total debt and finance lease obligations of $24.8 billion.

“I would like to thank our entire team for their outstanding work during a challenging operating environment for the industry as we work to restore our best-in-class reliability. Their performance coupled with strong demand drove nearly $2 billion of free cash flow as well as profitability in the first half of the year, and we are accruing profit sharing, marking a great milestone for our people,” Ed Bastian, Delta’s chief executive officer said.

“For the September quarter, we expect an adjusted operating margin of 11 to 13 percent, supporting our outlook for meaningful full-year profitability.”

According to Glen Hauenstein, Delta’s president, with growing demand across its network in the June quarter, Delta Airlines recaptured higher fuel prices and delivered an adjusted revenue recovery of 99 percent with unit revenues up 20.5 percent versus 2019.

“We also delivered another record quarter of American Express co-brand remuneration, up 35 percent from the June quarter 2019, reflecting growing brand preference and further diversification of our revenue base,” Hauenstein said.

Domestic passenger revenue was 3 percent higher and international passenger revenue was 81 percent recovered compared to the June quarter 2019. Revenue in Latin America and Transatlantic both exceeded 2019 levels in the month of June and the pace of recovery in the Pacific saw meaningful improvement, driven by Korea and Australia re-openings and the easing of restrictions in Japan.

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Domestic corporate sales for the quarter were 80 percent recovered versus 2019, up 25 points compared to the March quarter. International corporate sales for the quarter were 65 percent recovered versus 2019, up 30 points compared to the March quarter, driven by outsized improvement in Transatlantic.

Recent corporate survey results show positive expectations for business travel in the September quarter, including optimism around international travel given the elimination in June of the pre-departure test requirement for flights to the U.S.

Premium product revenue recovery outpaced Main Cabin across all markets. Premium and other diversified revenue streams, including Loyalty, Cargo and MRO, comprised 54 percent of total revenues.

Cargo revenue was $272 million, a 46 percent increase compared to the same period in 2019. MRO revenue in the June quarter was $178 million, restored to 85 percent of 2019 levels.

“Our June quarter non-fuel unit cost performance of up 22 percent compared to 2019 was impacted by lower capacity, higher selling-related expenses and investments in operational reliability,” Dan Janki, Delta’s chief financial officer said.

“We remain confident in our ability to meaningfully improve our unit costs as we fully scale the network and return our operations to Delta’s high standards. In the near-term, as we prioritize restoring reliability, our full year non-fuel unit cost will remain higher than our previous plan by approximately eight points on five points less capacity.”