Delta reported $12.5 billion in revenues for the second
quarter, up 8.7 percent year over year to a record total for the period as its
corporate travel outlook remains strong.
Corporate revenues were up 6 percent year over year in the
quarter, thanks largely to an 8 percent growth in domestic corporate revenues,
Delta president Glen Hauenstein said. The growth has been a "volume
story," he said, as yields have been stable for the carrier. Ticket
revenue from premium products was up 10 percent year over year in the quarter.
"Pockets of international softness in the automotive
and manufacturing industries are being offset by strength in health care,
technology and financial services sectors," Hauenstein said.
Delta's most recent survey of its corporate customers showed
83 percent expect air travel spending will be the same or higher year over year
in the current quarter, he said.
At the same time, Delta is benefiting from the ground of the
Boeing 737 Max aircraft, as the only carrier among the four largest U.S.
carriers that does not use the aircraft type, Cowen analyst Helene Becker said
in a research note.
"Delta is benefiting from the spillover traffic and
likely [is] looking to expose these new customers to their products and
operational efficiencies," according to Becker's note. "Delta
continues to run the best operation among their large competitors with
management noting they have achieved 82 days with no cancellations so far this
year."
CEO Ed Bastian also noted that the second quarter marked the
first time in the airline's history that it had zero passengers with
involuntary denied boardings.
Delta reported traffic increased 6.3 percent year over year
during the second quarter, and capacity was up 4.7 percent, pushing load factor
up 1.3 percentage points to 88 percent. Yield was up 1.4 percent year over year
during the quarter.
Delta's net income for the quarter was $1.4 billion, up 39
percent compared with the second quarter of 2018.
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