Key Highlights
- Delta’s Q1 adjusted earnings per share reached 64 cents, surpassing the consensus estimate of 58 cents; quarterly revenue of $14.2 billion exceeded forecasts.
- Shares of DAL climbed approximately 13% during premarket hours, while competitors United, American, and Southwest gained between 9% and 11%.
- The carrier projects Q2 adjusted EPS in the range of $1.00 to $1.50, with a $1.25 midpoint falling short of the $1.41 Wall Street consensus.
- Second-quarter fuel expenses are anticipated to increase by over $2 billion compared to last year, as jet fuel prices have nearly doubled since late February amid Iran tensions.
- The airline has eliminated all Q2 capacity expansion plans and implemented higher checked-baggage fees to mitigate elevated operational costs.
Delta Air Lines delivered first-quarter results that exceeded Wall Street’s projections, triggering a significant premarket rally on Wednesday. The positive momentum gained additional strength from news of a two-week U.S.-Iran ceasefire agreement, which provided a broad boost across the airline sector.
$DAL Q1’26 EARNINGS HIGHLIGHTS
🔹 Revenue: $14.2B (Est. $13.97B) 🟢; +9.4% YoY
🔹 Adj. EPS: $0.64 (Est. $0.61) 🟢; +44% YoY
🔹 Operating Margin: 4.6%; +0.1 pts YoY
🔹 Pre-Tax Income: $532M; +42% YoY
🔹 TRASM: 20.53¢; +8.2% YoYQ2 Guide:
🔹 Adj. EPS: $1.00 – $1.50 (Est. $1.70)… pic.twitter.com/84Xd8gtL9S— Wall St Engine (@wallstengine) April 8, 2026
The carrier reported adjusted earnings of 64 cents per share, topping consensus projections of 57 to 58 cents. Quarterly revenue reached $14.2 billion, also surpassing analyst expectations. The strong performance rippled through the sector, with shares of United, American, and Southwest climbing between 9% and 11% in early trading.
Looking ahead to the second quarter, Delta adopted a more conservative stance. The airline forecast adjusted EPS between $1.00 and $1.50, placing the midpoint at $1.25—notably below the analyst consensus of $1.41. Management opted not to revise full-year guidance, pointing to ongoing uncertainty surrounding fuel prices.
Jet fuel costs have experienced a dramatic surge, nearly doubling since the end of February due to escalating tensions involving Iran. Delta anticipates paying approximately $4.30 per gallon during Q2, representing an additional expense of more than $2 billion compared to the corresponding period in 2024.
To manage these pressures, Delta is deploying multiple strategic initiatives. The company’s proprietary oil refinery is projected to contribute a $300 million benefit in the second quarter, a substantial increase from the roughly $60 million benefit realized in Q1 as refining margins expanded. CEO Ed Bastian indicated the airline targets recovering between 40% and 50% of the elevated fuel costs through pricing adjustments during the quarter.
On Tuesday, Delta announced an increase to checked-baggage fees, mirroring recent actions by United and JetBlue. When asked about the permanence of these changes, Bastian suggested they could remain in place. “Given the current fuel environment, it’s difficult to characterize anything as temporary,” he noted.
Scaling Back Expansion Plans
Delta has scrapped all previously planned capacity increases for the June quarter, representing a reduction of approximately 3.5 percentage points from its initial projections. The airline further stated that future capacity growth plans now carry a “downward bias pending improvement in the fuel landscape.”
Across the U.S. airline industry, carriers have collectively trimmed domestic capacity growth projections by more than half a percentage point since mid-March. Delta’s ownership of a refinery and robust demand fundamentals position the carrier somewhat more favorably than competitors to weather the current headwinds.
Bastian reported that ticket sales have increased at a double-digit rate year-over-year throughout the past month, with strong momentum carrying into the second quarter. Notably, affluent travelers continue to demonstrate resilient demand with no indications of scaling back travel plans.
Wide Divergence in Analyst Projections
Full-year earnings per share forecasts among Wall Street analysts span a remarkable range from as low as 15 cents to as high as $7.50, underscoring substantial uncertainty about the trajectory of fuel prices. The consensus estimate stands at approximately $5.40 to $5.52, according to data from LSEG and FactSet.
JPMorgan adopted the most bearish stance, dramatically reducing its estimate from $7.05 to merely 15 cents. Analyst Jamie Baker explained that the firm has incorporated a full-year jet fuel assumption that management believes cannot be fully offset through fare increases—although JPMorgan maintained its Overweight rating on the stock.
UBS analyst Atul Maheswari maintained a Buy rating with a $5.12 EPS projection, while acknowledging he would not be surprised if Delta opts to withdraw its full-year guidance altogether.
Back in January, Delta had issued full-year adjusted EPS guidance of $6.50 to $7.50. On Wednesday, Bastian declined to provide any update to that forecast range.
