Delta has warned of potential changes in air travel trends and “softer, closer demand” to lower fiscal expectations for the first quarter.
The initial approval from major US airlines is linked to US President Donald Trump's tariffs on longtime trading partners, and the fear of a recession affects airline revenue expectations.
And it was a potentially ominous sign from the Delta, previously saying it was riding on “acceleration” premiums and international demand in the first quarter.
Before making an announcement at the JPMorgan meeting on March 11, Delta said it expects first quarter revenue to increase by 3-4% year-on-year compared to previous forecasts that revenues will be high in the three months ended March 31.
Delta also revised its margin expectations downwards, from 6-8% to 4-5%.
“The outlook is impacted by the recent decline in consumer and business trust caused by increased macro uncertainty, and by promoting softer domestic demand,” Delta says. “Premium, international and loyalty revenue growth is consistent with expectations and reflects Delta's diversified revenue-based resilience.”
Executives from Delta, JetBlue Airways, Southwest Airlines, Sun Country Airlines and United Airlines will speak at the meeting.
The conference is expected to focus primarily on the sudden, bleak US economic outlook, due to increased consumer pessimism, uncertainty about Tarif and several days of stock market losses.
Delta has expressed confidence that it will remain in a strong long-term position and promote its balance sheet, three- to five-year financial plan, and “industry-leading operational and cost execution.”
The company filed a profit of $843 million in the fourth quarter, compared to profits of more than $2 billion in the same period in 2023.
