Delta Lowers Full-Year Profit Outlook as Fuel Costs Surge
Delta cut its full-year adjusted EPS guidance to $5.10-$5.60 from $6.50-$7.50 after fuel expenses are expected to rise by about $6 billion. Third-quarter adjusted EPS came in at $1.72, slightly below analyst expectations, while revenue rose and demand held up. The fuel increase is larger than Delta's projected adjusted pre-tax profit, and United and American face similar market fuel prices.
Delta Air Lines reduced its annual adjusted earnings guidance to $5.10–$5.60 per share, from an earlier $6.50–$7.50 range, after projecting roughly $6 billion more in fuel expenses. Third-quarter adjusted EPS was $1.72, just under the $1.75 consensus, while adjusted revenue increased about 16%.
The carrier expects about $4.5 billion in adjusted pre-tax profit for the year, less than the added fuel cost. Its fourth-quarter fuel assumption is about $4.25 per gallon, above the $3.61 paid last quarter. United and American purchase fuel in the same market, though their costs vary.
If fuel prices stay elevated, Delta and peers may pass some costs to travelers through higher fares or fees, potentially affecting household travel budgets. Investors could face weaker earnings and revised analyst targets. Airline employees, suppliers, and tourism-dependent communities may feel pressure if carriers adjust capacity or spending. The extent depends on demand, hedging, and competitive responses, so effects could vary across routes and regions.