Delta Air Lines’ financial performance continues to make profit in the three months up to September 30th 2023. This continues the upward trend in Delta Air Lines’ finances as it remains in the black. The airline has been performing reasonably well in recent times having had a profitable year-end in 2022 and a profitable second quarter of this year. The only recent dip suffered by Delta Air Lines was in the first quarter of this year which was loss making.
As we know, the situation for airlines has not been easy in recent years. When the pandemic struck, governments around the world placed restrictions on foreign travel. This caused demand for flights to plummet resulting in heavy losses for airlines. Delta Air Lines’ financial performance was also affected by this. To make matters worse, after pandemic restrictions were lifted there was a surge in demand for flights. Airports and airlines were unable to cope with this as there were staff shortages since many had been laid off during the pandemic when demand was less. This meant that there was mass congestion at airports leading to many flight delays and cancellations. In North America, the Independence Day weekend last year was severely affected with mass delays and cancellations of flights in the United States and Canada. To add to this the war in Ukraine and subsequent sanctions against Russian oil have resulted in a rise in fuel prices.
Delta Air Lines’ Financial Performance
Fortunately however Delta Air Lines’ financial performance has recovered since the pandemic and is faring well. In the most recent financial release, the company made a profit of 1.108 billion US dollars in the three months up to September 30th 2023. This is 59% higher than the 695 million US dollars made in the three months up to September 30th 2022. It is however 39% lower than the profit made in the previous quarter which was 1.827 billion US dollars. Nevertheless, the profit made is a significant improvement on last year. The dip when compared to the previous quarter could be explained by seasonal variation. This is when there is a natural variation in the year as to profits as people may be taking more flights at certain times when for example during school summer holidays. However there no room for the airline to be too complacent as the three months up to September is still predominantly in the summer season.
In terms of Delta Air Lines’ revenue (total money received), the airline made a figure of 15.488 billion US dollars in the three months up to 30th September 2023. This is a 11% improvement on the same time period last year in which Delta Air Lines’ financial performance resulted in a revenue of 13.975 billion US dollars. This shows that the company is attracting more customers when compared to the same time last year. There has however been a slight dip in revenue when compared to the previous quarter when Delta Air Lines made a revenue of 15.578 billion US dollars. This is however less significant than the dip in profit, suggesting that Delta Airlines finances had more difficulties in terms of cost control in this quarter. However, when compared to the same time period last year it does appear that cost control has improved as shown by the fact that the proportionate increase in revenue, although was still significant at 11%, was less than the 59% increase in profit.
The Company’s Response
The company’s response to Delta Air Lines’ financial performance was very positive. Ed Bastian, the company’s Chief Executive Officer has said that his team has done outstanding work. He has commented that the revenue made was a record for this time of year. He is recognizing the work of his staff with over one billion dollars given through profit sharing.
As one can see Delta Air Lines’ financial performance has resulted in a healthy profit for the third quarter. There has however been a slight dip since the last quarter. However when compared to last year at the same time there has been a significant improvement. We have to wait to see how this progresses.
