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Summary
- Delta Air Lines' net income in the June quarter totaled US$652 million.
- The company had reported a loss in its last five consecutive quarters.
- Delta Air Lines stock return is almost flat year to date.
Delta Air Lines (NYSE:DAL) on July 14 posted a net income in its second quarter after reporting a loss in the last five consecutive quarters.
The company had been reporting loss since the first quarter of 2020 as the coronavirus pandemic impacted its operations. The strong growth in its revenue and government aid for airline workers supported the company’s return to profit in the second quarter.
Delta Air Lines CEO Ed Bastian said domestic leisure travel has now fully recovered to the pre-pandemic levels and the company is seeing encouraging signs of improvement in its business and international travel.
Delta Air Lines stock, which closed at US$41.33 on Tuesday, rose up to US$42.12 on Wednesday morning before it went down. As of 11:53 am ET, the shares were trading at US$40.21, down 2.71 percent.
The company has a market capitalization of US$25.76 billion. The stock return is almost flat percent year to date. Its shares have a 52-week range of US$24.38 to US$52.28.
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Second-quarter results
Delta Air Lines reported a net income of US$652 million in the June quarter, compared with the loss of US$5.71 billion in the second quarter of 2020, in which the COVID-19 pandemic hit the company’s business. In the second quarter of 2019, it had booked a net income of US$1.44 billion.
Meanwhile, adjusted net loss in this second quarter narrowed to US$678 million, or US$1.07 per share, from the loss of US$2.81 billion, US$4.43 per share, in the year-ago period. In the same quarter of 2019, it had posted an adjusted net income of was US$1.53 billion, or US$2.35 per share.
Total operating revenue came in at US$7.13 billion during the quarter. This compares with the revenue of US$1.46 billion and US$12.53 billion in the same quarter of 2020 and 2019 respectively.
READ MORE: JP Morgan, Goldman Sachs start earnings season with strong Q2 results
Source: Pixabay
Delta Air Lines has also cut its operating expenses by 39 percent to US$6.31 billion from the 2019 level. Its total passenger capacity in the second quarter is down 32 percent from 2019.
Third-quarter forecast
In its third quarter of 2021, Delta Air Lines anticipates revenue to decline in the range of 30 percent to 35 percent from the third quarter of 2019.
Capacity is projected to be down between 28 percent and 30 percent from the 2019 level.
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Delta Air Lines now forecasts its total gross capital expenditure in full-year 2021 to around US$3.2 billion.
Please note: The above constitutes a preliminary view and any interest in stocks/cryptocurrencies should be evaluated further from an investment point of view.
