What to look for when Delta Air Lines (DAL) reports Q3 2024 earnings results

Shares of Delta Air Lines (NYSE: DAL) were down over 2% on Wednesday. The stock has gained 14% over the past one month. The airline is scheduled to report its third quarter 2024 earnings results on Thursday, October 10, before market open. Here’s a look at what to expect from the earnings report:

Revenue

Delta now expects its total revenue for the third quarter of 2024 to be flat to up 1% year-over-year versus its initial guidance of up 2-4%. The company forecasts total revenue to range between $15.75-15.90 billion on a GAAP basis, and $14.55-14.70 billion on an adjusted basis.

Analysts are estimating revenue of $15.7 billion for Q3 2024, which compares to revenue of $15.5 billion reported in the same period last year. In the second quarter of 2024, GAAP operating revenue increased 7% year-over-year to $16.7 billion.

Earnings

The consensus estimate for earnings per share in Q3 2024 is $1.55, which compares to adjusted EPS of $2.03 reported in Q3 2023. In Q2 2024, adjusted EPS fell 12% YoY to $2.36.

Points to note

Last quarter, Delta guided for EPS in Q3 2024 to range between $1.70-2.00. In an investor update last month, the company said the technology-driven outage is estimated to impact Q3 EPS by $0.45. Excluding this impact, EPS is expected to be at the high-end of the initial guidance.

Delta is expected to benefit from strong travel demand. It has been seeing momentum in the domestic and Transatlantic regions which is a positive. The improvement in business travel is also yielding benefits for the airline. As mentioned in its investor update, Delta’s unit revenue trends have been improving as expected, with strength in travel demand and moderating industry supply growth.

Capacity for the September quarter is now expected to be up around 4% YoY versus the earlier guidance of up 5-6%. Non-fuel unit cost, or CASM-Ex, is projected to be up around 5.5% YoY versus the previous outlook of up 1-2%. The updated cost guidance takes into account factors such as higher weather disruption, the CrowdStrike technology outage, and the decision to reward employees with confirmed flight passes.