The last few years have been difficult for the airline industry as it was among the biggest losers when the pandemic first hit in early 2020. However, with lesser restrictions on travel, the airline industry has bounced back strongly and is close to surpassing the pre-pandemic performance levels.
Delta Air Lines, Inc.’s (DAL) earnings and revenue exceeded analyst estimates in the fourth quarter.
Its EPS came 11.9% above the consensus estimate, while its revenue beat the estimate by 6.6%. The company’s operating margin came in at 10.9%, while its adjusted operating margin came in at 11.6%.
DAL’s CEO Ed Bastian said, “Delta people rose to the challenges of 2022, delivering industry-leading operational reliability and financial performance, and I’m looking forward to recognizing their achievements with over $500 million in profit-sharing payments next month.”
Glen Hauenstein, DAL’s President, said, “For the year, we delivered $45.60 billion in adjusted revenue, a $19 billion increase over the prior year, with record unit revenue performance expected to sustain a revenue premium to the industry of more than 110%. Momentum continues in 2023 with strong demand trends, and we expect March quarter adjusted revenue to be 14 to 17% higher than 2019 on capacity that is 1 percent lower.”
The company’s revenue passenger miles for the fourth quarter increased 24.9% year-over-year to 50.47 billion. Its passenger revenue per available seat mile increased 30.8% year-over-year to 18.30 cents.
Also, its total revenue per available seat mile (TRASM) increased 23.4% from the prior-year period to 22.58 cents. In addition, its total passenger revenue increased 50.4% year-over-year to $10.89 billion.
For the fiscal first quarter ending March 31, 2023, DAL expects its total revenue to increase 14% to 17% over the same quarter of 2019 and its operating margin to come in between 4% and 6%. Its EPS is expected to come between $0.15 and $0.40. For fiscal 2023, DAL expects its total revenue to increase 15% to 20% and operating margin to rise 10% to 12% over the previous year. Its EPS is expected to come between $5 to $6.
DAL’s CEO Ed Bastian said, “As we move into 2023, the industry backdrop for air travel remains favorable, and Delta is well positioned to deliver significant earnings and free cash flow growth.” Continue reading "This Airline Stock is Expecting a Strong 2023"