Delta Air Lines Forecasts Record Financial Year Amid Strong Travel Demand

Delta Air Lines reported robust financial results for the fourth quarter of 2024 and projected a record-breaking year ahead, driven by strong travel demand and premium customer spending. The Atlanta-based airline announced on Friday that it expects to generate more than $4 billion in free cash flow in 2025, an 18% increase from 2024, and adjusted earnings of over $7.35 per share.

CEO Ed Bastian expressed confidence in the company’s outlook, stating, “We feel quite good coming into the new year. Everywhere, we see consumers continue to prioritize experience over goods.” Bastian added that 2025 is poised to be Delta’s “best financial year in our history.” The airline’s shares surged more than 7% in premarket trading following the announcement.

For the fourth quarter of 2024, Delta reported a 9% increase in revenue to $15.6 billion, with adjusted earnings of $1.85 per share, surpassing analysts’ expectations. However, net profit fell 59% to $843 million due to rising expenses, including a 7% increase in payroll costs. Revenue from premium seats, such as first class and premium economy, rose 8% to $5.2 billion, outpacing the 2% growth in main cabin ticket revenue.

Delta’s partnership with American Express contributed $2 billion in revenue during the quarter, a 14% year-over-year increase. The airline has capitalized on a trend toward premium travel, with more customers opting for roomier seats and rewards credit cards. Unit revenue, a key metric for airline profitability, rose 4% in the fourth quarter compared to 2023.

Looking ahead, Delta expects first-quarter 2025 revenue to grow 7% to 9%, exceeding analysts’ forecasts. The airline also anticipates earnings of between 70 cents and $1 per share for the quarter, slightly ahead of Wall Street predictions. Bastian emphasized Delta’s differentiated strategy and operational excellence as key drivers of its success.

Delta’s strong performance reflects a broader recovery in the airline industry, which has benefited from pent-up travel demand following the COVID-19 pandemic. Analysts predict that demand will remain robust in 2025, with consumers continuing to prioritize travel experiences over other discretionary spending.

The airline plans to reward its employees with $1.4 billion in profit-sharing payments next month, underscoring its commitment to sharing success with its workforce. Delta’s financial outlook and operational achievements position it as a leader in the competitive airline industry.