Delta Air Lines Inc. (NYSE: DAL) swung to a wider-than-expected loss in the first quarter, despite revenue beating analysts’ estimates. The company, however, expressed confidence that it will return to profitability in fiscal Q3. For the current quarter, Delta expects to generate cash.
Delta Air Lines shares that you can conveniently trade online via a range of user-friendly apps opened more than 1% up on Thursday but tanked just under 5% in the next hour. Including the price action, the stock is now exchanging hands at £34 per share. In comparison, Delta Air Lines had started the year at a lower £28 per share.
Delta Air Lines’ Q1 financial results versus analysts’ estimates
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Delta Air Lines reported £860 million of net loss in the first quarter that translates to £1.34 per share. In the same quarter last year, its net loss was capped at a lower £529.52 million, or 79 pence per share.
Adjusted for one-time items, the air carrier lost £2.58 per share in Q1. Delta generated £3.01 billion of total revenue in the recent quarter that represents a 60% annualised decline. In the prior quarter (Q4), Delta had recorded £551.58 million of net loss.
According to FactSet, experts had forecast the company to post £2.86 billion of revenue in the first quarter. Their estimate for adjusted per-share loss stood at a narrower £2.27. At 45%, load factor matched expectations.
On average, Delta Air Lines burned £7.98 million in Q1. In March, however, the airline generated £2.90 million per day on average as demand for air travel recovered a bit after a massive hit due to the Coronavirus pandemic.
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Chief Executive Ed Bastian’s comments on Thursday
CEO Ed Bastian commented on the earnings report on Thursday and said:
“A year after the onset of the pandemic, travellers are gaining confidence and beginning to reclaim their lives. If recovery trends hold, we expect positive cash generation for the June quarter and see a path to return to profitability in the September quarter as the demand recovery progresses.”
In separate news from the United States, BlackRock reported an increase in quarterly profit as assets under management jumped over £6.53 trillion.
Delta Air Lines performed largely downbeat in the stock market last year with an annual decline of close to 30%. At the time of writing, the Atlanta-based air carrier has a market cap of £21.72 billion.