Delta Air Lines reported record September quarter revenue as broad demand strength, healthy yields, premium growth, and diversified revenue streams helped the airline absorb a significant increase in fuel costs.
GAAP operating revenue reached $20.2 billion in the September quarter, while adjusted operating revenue totaled $17.6 billion.
Adjusted revenue increased 16% year-over-year on essentially flat capacity, reflecting stronger pricing and demand across Delta’s domestic and international network.
Adjusted pre-tax income was $1.5 billion, up slightly from the prior-year period, while adjusted net income increased to $1.13 billion.
Adjusted earnings per share reached $1.72, compared with $1.70 a year earlier.
Delta said the quarter’s performance demonstrated the durability of its business model even as adjusted fuel expense increased 62% year-over-year.
The airline generated $1.7 billion of operating cash flow during the quarter and $463 million of free cash flow.
Year-to-date free cash flow reached $1.9 billion.
Delta expects approximately $2.5 billion of free cash flow for the full year and plans to repay more than $2 billion of debt during 2026.
Adjusted net debt ended the September quarter at $13.4 billion, down approximately $950 million from the end of 2025.
Delta ended the quarter with $6.9 billion of liquidity, including $3.1 billion of undrawn revolving credit capacity.
Revenue trends remained strong across Delta’s network.
Domestic unit revenue increased 16% year-over-year, while international unit revenue rose 12%.
Latin America led international performance with unit revenue growth of 22%, while Transatlantic unit revenue increased 11%.
Transpacific revenue grew 13%, supported by an 8% increase in capacity and new routes to Asia.
Premium revenue increased 18% year-over-year, cargo revenue grew 29%, and maintenance, repair, and overhaul revenue increased 28%.
Delta’s diversified revenue streams accounted for 61% of total revenue during the quarter.
Loyalty revenue increased 18%, while American Express co-brand card acquisitions and spending both grew at double-digit rates.
Travel products and non-air partnership revenue increased 25%.
Corporate sales also increased at double-digit rates across all sectors, led by banking, technology, and energy customers.
Delta said more than 90% of respondents in its latest corporate travel survey expect their travel activity to increase or remain unchanged in 2027.
The airline expects revenue momentum to continue into the December quarter, forecasting total revenue growth of approximately 20% year-over-year.
For full-year 2026, Delta expects earnings per share of $5.10 to $5.60 and approximately $2.5 billion of free cash flow.
The company expects to generate roughly $4.5 billion of pre-tax profit for the full year despite absorbing approximately $6 billion of additional fuel costs.
Delta also continued investing in its network and fleet.
The airline took delivery of 13 aircraft during the quarter, including Airbus A350-900, A321neo, and A220-300 aircraft.
Delta announced new international service from Seattle to Tokyo-Narita, Los Angeles to Manila, Austin to Paris-Charles de Gaulle, Detroit to Athens, and Boston to Venice beginning in 2027.
The airline also announced its largest-ever Los Angeles schedule.
Operationally, Delta led major U.S. carriers in on-time arrival and departure performance during the quarter and achieved a company September-quarter record for domestic mishandled baggage performance.
The company also continued expanding its customer and loyalty ecosystem through initiatives including a new relationship with Hyatt, an enhanced Starbucks partnership, expanded free Wi-Fi, and the rollout of its AI-powered Delta Concierge to all SkyMiles members.
KEY QUOTES:
“Demand remains strong, supported by consumers’ growing preference for experiences and travel, with air travel continuing to be one of the best values in the consumer economy. Against this backdrop, we delivered September quarter pre-tax profit of $1.5 billion, matching last year’s performance, and generated $1.9 billion of free cash flow year-to-date. Our resilience reflects the structural durability we’ve built over many years, enabling us to effectively navigate one of the most elevated fuel environments in recent times. The foundation of that resilience is our people, whose commitment to delivering for our customers continues to set Delta apart.”
“For the full year, we expect to generate a pre-tax profit of roughly $4.5 billion, absorbing a $6 billion increase in fuel costs. Looking ahead, our focus remains on profitable growth and delivering against our long-term financial framework, including mid-teens margins and returns, durable free cash flow and gross leverage of approximately one times.”
Ed Bastian, Chief Executive Officer of Delta Air Lines
“September quarter revenue grew approximately 16 percent over prior year, on flat capacity, driven by broad demand strength and healthy yield growth as we cover higher costs and manage the business for margins.”
“Revenue momentum is continuing in the December quarter, with strength across all products and geographies, supporting our outlook for total revenue growth of approximately 20 percent over last year.”
Joe Esposito, Chief Commercial Officer of Delta Air Lines
“We generated $463 million of free cash flow in the September quarter. The strength of our cash flow generation allows us to consistently reinvest to compound our advantages while reinforcing our investment grade balance sheet. For the full year, we expect to deliver free cash flow of approximately $2.5 billion and pay down more than $2 billion of debt, positioning us to end the year with gross leverage of approximately 2.2x.”
Erik Snell, Chief Financial Officer of Delta Air Lines
