Delta Air Lines Non-GAAP EPS of $1.44 misses by $0.28, revenue of $13.8B beats by $400M
- Delta Air Lines press release (NYSE:DAL): Q2 Non-GAAP EPS of $1.44 misses by $0.28.
- Revenue of $13.8B (+93.5% Y/Y) beats by $400M.
- Adjusted Revenue of $12.31B vs. consensus of $12.33B.
- The company is on track to achieve 2024 targets of over $7 adj. EPS and $4B of free cash flow.
- Q3 Outlook: Capacity to be down ~15% to 17% vs. 3Q19; Total Revenue to grow by 1% to 5% vs. 3Q19; Adjusted Net Debt of ~$20B down from Q2 net debt of $19.6B.
- "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," said Dan Janki, Delta's chief financial officer. "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 8 points on 5 points less capacity."
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Comments (5)
As expected, Delta delivered a strong result that will put them back in the postiion as the most profitable airline in the world and they delivered on the strategies that I laid out in this articleseekingalpha.com/...Revenue is recovering very nicely esp. in international markets but costs bit more than expected, partly due to fuel and partly due to lower volume due to operational challenges - but partly due to non-fuel inflation.
The refinery is generating a positive result worth hundreds of millions of dollars per quarter which, added to Delta's improved fuel efficiency, will save the company $1.5 to 2 billion in fuel per year.Given that many are expecting DAL's results to speak to not just the rest of the airline industry but also the general economy, the theme is that demand is back where people can freely travel - only a few countries in Asia are practically still off the table. People are traveling in large numbers and paying good money for their travel but Delta is also generating strong revenues from non-transportation sources.
Other companies will not have the huge return of pent up demand that airlines are experiencing right now which gives airlines an advantage.
As the rest of the industry reports its results, it is doubtful that anyone anywhere will beat Delta's results or its guidance
The refinery is generating a positive result worth hundreds of millions of dollars per quarter which, added to Delta's improved fuel efficiency, will save the company $1.5 to 2 billion in fuel per year.Given that many are expecting DAL's results to speak to not just the rest of the airline industry but also the general economy, the theme is that demand is back where people can freely travel - only a few countries in Asia are practically still off the table. People are traveling in large numbers and paying good money for their travel but Delta is also generating strong revenues from non-transportation sources.
Other companies will not have the huge return of pent up demand that airlines are experiencing right now which gives airlines an advantage.
As the rest of the industry reports its results, it is doubtful that anyone anywhere will beat Delta's results or its guidance
@Dukebailey
Delta is almost always the first to report and gets hit disproportionately harder when they miss their estimate.Given that the miss was heavily due to fuel price hikes in the month of June - Delta gave its last guidance on June 1 - it is a given that other airlines will also have significant fuel increases since their last guidance. The difference is that AAL UAL JBLU SAVE and others have no active fuel cost reduction strategies such as hedging or the refinery strategy which DAL has.
It will all equalize shortly after the earnings season ends.
Delta is almost always the first to report and gets hit disproportionately harder when they miss their estimate.Given that the miss was heavily due to fuel price hikes in the month of June - Delta gave its last guidance on June 1 - it is a given that other airlines will also have significant fuel increases since their last guidance. The difference is that AAL UAL JBLU SAVE and others have no active fuel cost reduction strategies such as hedging or the refinery strategy which DAL has.
It will all equalize shortly after the earnings season ends.