Delta will report fourth-quarter earnings on Friday that will give a sense of how its 2024 went. According to the finance data platform FactSet (FDS-1.51%), Wall Street is expecting $1.1 billion in quarterly net income on $14.2 billion in revenue. For the full year, investors are looking for $3.9 billion on $56.7 billion in revenue. All four figures would represent declines from the same time the year before.
These are the storylines to keep in mind when the numbers come in and the earnings call chatter unfurls.
Ratings agency Fitch brough back Delta’s investment-grade credit rating last summer after cutting it to junk during the early years of the COVID-19 pandemic, citing its best-in-class market share as part of its rationale.
“Delta’s investment grade rating is supported by its position as a leading network airline in the consolidated U.S. market,” the agency said. “Dominant positions in key hubs and a high level of network utility provide a competitive advantage over smaller airlines.”
That means that Delta will have more freedom to do pretty much whatever it wants.
Though players on the lower end of the market ended 2024 poorly — namely the now-bankrupt Spirit Airlines — Delta has been focusing on its premium customers. It’s announced huge new ultra-luxe airport lounges, serving fancy burgers mid-air, and initiatives to upsell flyers wherever it can.
“I’d say we’re excited when basic economy offerings are shrinking because that means that the offerings that are sitting on top of them are greater,” President Glen Haustein said at the company’s Investor Day in November. “I would say I would be disappointed in 2025 if we had more basic economy availability than we did in 2024, and that’s being choked off by higher-end demand and higher end demand is coming through corporate, but also high-end leisure.”
Though some sectors of the economy are feeling anxious about the incoming second presidency of Donald Trump, the airline industry is not one of them. Delta CEO Ed Bastian recently told CNBC (CMCSA-1.09%) that he thinks Trump could be a “breath of fresh air” for carriers.
The Biden administration challenged airlines on the proliferation of so-called “junk fees” for things like seat selection and carry-ons that are frustrating for customers but beneficial to bottom lines. Plus: If Delta’s big plans include, perhaps, a merger or acquisition (it already ruled out stock buybacks), the company wouldn’t have to deal with Lina Khan’s Federal Trade Commission in carrying them out.
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