Delta Air Lines, Inc. DAL shares are trading higher premarket after the company reported better-than-expected first-quarter 2025 results.
Delta reported fourth-quarter operating revenue growth of 2% year-over-year to $14.04 billion, beating the consensus of $13.02 billion. Adjusted operating revenue was $12.98 billion (+3.3% YoY)
The adjusted average fuel price was $2.47 per gallon, down from $2.79 in last year’s quarter. Adjusted EPS was $0.46 (+2% YoY), beating the consensus of $0.38.
Related: Top Wall Street Forecasters Revamp Delta Air Lines Price Expectations Ahead Of Q1 Earnings
Total passenger revenue for the quarter grew 3% year over year to $11.48 billion; cargo revenue grew 17% year over year to $208 million, and Other revenue was $2.352 billion (-4% year over year).
Delta recorded an adjusted operating income of $591 million, down from $640 million YoY, with an adjusted operating margin of 4.6%, down 50 bps.
Adjusted operating expenses increased by 4% YoY to $12.388 billion, and Adjusted Non-fuel costs were $9.875 billion (+7% YoY) for the quarter.
Delta generated an adjusted operating cash flow of $2.44 billion (-1% Y/Y) in the March quarter, and free cash flow stood at $1.28 billion.
As of the March quarter, Delta reported adjusted net debt of $16.9 billion, down $1.1 billion from year-end 2024. Total liquidity was $6.8 billion, including $3.1 billion in undrawn revolver capacity.
The passenger load factor dropped 81.4% from 82.7% last year. DAL’s Air Traffic Liability ended the quarter at $10 billion.
Also Read: Which US Airline Faces The Strongest Industry Tailwinds?
Delta’s Chief Financial Officer, Dan Janki, noted that the company delivered better-than-expected results despite early-year weather challenges. “Our teams ran a strong operation… enabling us to drive efficiency and deliver non-fuel unit cost growth of up 2.6 percent over prior year,” he said. Janki added that as Delta reduces capacity growth, it is “taking incremental action to manage costs,” and expects non-fuel unit cost growth to align with its long-term target of low-single-digit increases in the second quarter and beyond.
“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,” commented Ed Bastian, Delta’s chief executive officer.
“We expect June quarter profitability of $1.5 to $2 billion. Given the lack of economic clarity, it is premature at this time to provide an updated full-year outlook. Given our position of strength, our bias toward action, and the decline in fuel prices, Delta remains well positioned to deliver solid profitability and free cash flow for the year. I expect that our financial results will continue to lead the industry and validate our strategy to create differentiation and greater financial durability,” added Bastian.
Second Quarter 2025 Outlook: DAL’s total revenue is expected to be down 2% to up 2% over the prior year, with an operating margin of 11%—14%.
Adjusted Earnings per share are forecasted between $1.70 and $2.30 versus the $2.39 estimate.
Delta is not reaffirming its full-year 2025 financial guidance and plans to provide an update later in the year as market visibility improves.
Price Action: DAL shares are trading lower by 0.45% at $35.73 premarket at the last check on Wednesday.
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