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Tuesday, April 20, 2021

Delta Airlines Net Loss Soars on Hurricane Embiggen

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Updated: 4:34 p.m.

Delta Air Lines reported a fourth-quarter loss of $5.4 billion on Thursday, as revenue growth stalled and the carrier continued to absorb the after-effects of two deadly hurricanes.

The Atlanta-based airline lost $14.96 per share in the quarter. The results came in well off the expectation of Wall Street analysts, who expected a loss of $6.36 per share.

But the huge loss follows a crushing year for the industry, which has faced mounting costs and ongoing pressure from long-standing labor issues.

Delta’s revenue was $9.56 billion in the fourth quarter, compared with $10.55 billion in the same period last year. Analysts expected revenue of $9.7 billion. The company’s cost per available seat mile, a closely watched metric in the airline industry, was up more than 3 percent.

Delta has been dealing with labor issues for months. Late last year, it announced that it was suspending merger talks with Hawaiian Airlines, in part because of union disputes. It also engaged in a high-profile dispute with its machinists’ union earlier this year.

Airline stocks took a hit earlier in the year, amid concerns that higher jet fuel prices would dramatically affect profits. The New York Times’s Robert Pear reported that airlines were forced to abandon plans to expand and move to provide higher-end service to pay for higher fuel costs.

But airline stocks have been hit anew recently, as airline companies have begun to see recovery in their financial performance. Delta and American Airlines posted profit increases for the third quarter, with Delta reporting a 28 percent jump in profit. American Airlines reported a 12 percent increase.

Still, revenues have not fully bounced back as the carriers offer more discounted fares to lure customers back in.

It is unclear how Delta plans to address its troubles with labor, but it said Thursday that it planned to sharply cut its bonus payout to its executives.

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