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Delta Air Lines Reports Impressive Quarter
This past Thursday, Delta Air Lines announced record-breaking operating revenue and operating income in their June quarter financial results. The Atlanta-based carrier reported record international performance numbers across the Atlantic, Pacific and South American regions. An uptick in passenger numbers compared to June last year correlates with new deliveries the carrier has received in the previous 12 months along with the reactivation of previously parked and stored aircraft.
This quarter’s reported revenue was up significantly, representing the carrier’s highest in history. Profitability for the carrier was just as impressive, operating at a margin of over 17%. The increase is partially attributed to an increase in consumer demand along with an overall decrease in fuel cost. Compared to the June quarter last year, the carrier’s fuel bill was 24% less for this quarter.
With the strong report for June and expecting this trend to continue into this fall, Delta’s President, Glen Hauenstein said, “Robust demand is continuing into the September quarter where we expect total revenue to be similar to the June quarter, up 11 percent to 14 percent compared to the September quarter 2022 on capacity that is 16 percent higher.”
Following the pandemic, international demand has rebounded tremendously in the past year with the Atlanta-based carrier operating the largest transatlantic schedule to date this summer. Total international revenue for the quarter was up 61% according to the carrier, with domestic travel also showing a strong return up 8%.
While being the smallest market in terms of revenue, Delta’s Pacific market saw the largest increase of 175% compared to June of last year. According to the release, the carrier attributes this to Japan’s re-opening to international travelers along with the joint venture with Korean Air.
The Atlanta-based carrier has been able to boost international flying due in part to new aircraft deliveries and reactivation of stored aircraft. According to UK-based aviation valuation firm, AviationValues, Delta currently has 91% of its total fleet active. This number is up significantly from the percentage of active aircraft during the pandemic, which data from AviaitonValues showed as 82% of the fleet.
The overall market value for the international carrier’s wide-body fleet has continued to grow since the pandemic began and had an uptick over the past year due to deliveries from Airbus. The carrier’s total Airbus A330 fleet has had a net valuation increase of 30.8% this past June compared to June of 2022. This is attributed to the delivery of new Airbus A330-900s from Airbus in the time frame.
The carrier’s A350 fleet has also seen a valuation increase denoting additional deliveries in between June 2022 and 2023. Delta took delivery of two examples in the 12 months, N518DZ and N519DN, according to airfleets.net. AviationValues saw a market value change for Delta’s Airbus A350 fleet year over year of 560 million during that period, denoting the deliveries.
Compared to the June quarter last year, the carrier offered 17% more seat miles for this quarter and operated with an 88% load factor. The carrier welcomed 18 new aircraft in the year, with 12 joining the fleet in the June quarter alone which helped attribute to the increase in available seat miles.
All aircraft currently being delivered to Delta are orders fulfilled by Airbus. The Airbus A321neo fleet has particularly grown in the 12-month time frame, from three examples to 32, according to AviationValues. With strong demand for domestic and international travel this summer, it’s no surprise that Delta predicts the second half of summer and the beginning of fall to produce strong results.
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