Delivered industry-leading operational performance, record March quarter completion factor March quarter revenue and earnings at the high end of guidance Expect record June quarter revenue, mid-teens operating margin, and EPS of $2.20 to $2.50 Reiterating 2024 outlook for EPS of $6 to $7 and free cash flow of $3 to $4 billion ATLANTA, April 10, 2024 /PRNewswire/ -- Delta Air Lines (NYSE:DAL) today reported financial results for the March quarter and provided its outlook for the June quarter.  Highlights of the March quarter, including both GAAP and adjusted metrics, are on page five and incorporated here. "Thanks to the extraordinary work of our 100,000 people, Delta is delivering the best operational reliability in our history, and we have widened the gap to our competitors.  We were thrilled to recognize their efforts with $1.4 billion in profit sharing payouts during the quarter," said Ed Bastian, Delta's chief executive officer. "For the March quarter, we delivered record revenue on outstanding operational performance, enabling strong earnings growth.  We anticipate continued strong momentum for our business, and in the June quarter, we expect to deliver record revenue, a mid-teens operating margin and earnings of $2.20 to $2.50 per share.  We remain confident in our full year targets for earnings of $6 to $7 per share and free cash flow of $3 to $4 billion." March Quarter 2024 GAAP Financial Results Operating revenue of $13.7 billion Operating income of $614 million with an operating margin of 4.5 percent Pre-tax income of $122 million with a pre-tax margin of 0.9 percent Earnings per share of $0.06 Operating cash flow of $2.4 billion Payments on debt and finance lease obligations of $712 million Total debt and finance lease obligations of $19.4 billion at quarter end March Quarter 2024 Adjusted Financial Results Operating revenue of $12.6 billion, 6 percent higher than the March quarter 2023 Operating income of $640 million with an operating margin of 5.1 percent Pre-tax income of $380 million with a pre-tax margin of 3.0 percent Earnings per share of $0.45 Operating cash flow of $2.5 billion Free cash flow of $1.4 billion Adjusted debt to EBITDAR of 2.9x, down from 3.0x at the end of 2023 Return on invested capital of 13.8 percent on a trailing five quarter average, up 2.8 points over prior year Financial Guidance1  FY 2024 Forecast Earnings Per Share $6 - $7 Free Cash Flow ($B) $3 - $4 Adjusted Debt to EBITDAR 2x - 3x 2Q24 Forecast Total Revenue YoY Up 5% - 7% Operating Margin 14% - 15% Earnings Per Share $2.20 - $2.50 1Non-GAAP measures; Refer to Non-GAAP reconciliations for historical comparison figures Additional metrics for financial modeling can be found in the Supplemental Information section under Quarterly Results on ir.delta.com. Revenue Environment and Outlook "We generated record March quarter revenues, 6 percent higher than the prior year.  Total unit revenue (TRASM) was down 0.7 percent compared to last year, including a nearly one-point headwind from Cargo and MRO.  This result was at the high end of our guidance, with the growth rate improving three points from the December quarter," said Glen Hauenstein, Delta's president.  "Strong demand for travel on Delta is continuing into the June quarter where we expect total revenue growth of 5 to 7 percent compared to the June quarter 2023 on TRASM of flat to down 2 percent.  Within this outlook, all geographic entities are expected to achieve unit revenue approximately flat to last year, except Latin, where we expect a double-digit decline as we lap strong performance and continue to profitably invest in the network." Record March quarter revenue: Delta delivered March quarter revenue that was 6 percent higher than 2023 driven by best-in-class operations and strong demand trends. Delta led the industry in completion factor and on-time performance, and operated 26 cancel-free, brand-perfect days in the quarter. Adjusted total unit revenue (TRASM) growth improved 3 points sequentially from the December quarter 2023 to down 0.7 percent year-over-year, including a nearly one-point headwind from cargo and MRO. Corporate travel demand accelerated: Managed corporate sales* grew 14 percent year-over-year, led by the return of large corporate accounts, particularly in the Technology, Consumer Services and Financial Services sectors. Recent corporate survey results indicate that 90 percent of companies expect their travel volumes to increase or stay the same in the June quarter and beyond. Domestic environment improved with robust demand: Domestic unit revenues were a March quarter record, growing 3 percent year-over-year with record domestic load factors. Unit revenues improved 7 points sequentially from the December quarter 2023, inflecting positive for the March quarter. International travel strength continued: International passenger revenue was 12 percent higher versus the March quarter 2023, with Transatlantic passenger unit revenue (PRASM) up 2 percent. International passenger unit revenues were down 3 percent on 16 percent higher capacity as Delta continued to invest in rebuilding the Latin and Pacific networks. Revenue diversification driving Delta's differentiation: For the quarter, diversified revenue streams, including Loyalty, Premium, Cargo and MRO comprised 57 percent of total revenues. Premium revenue grew 10 percent versus the March quarter 2023, continuing to outperform Main Cabin. Loyalty revenue was up 12 percent, driven by continued co-brand spend growth and increasing premium card mix. Remuneration from American Express for the March quarter was $1.7 billion, approximately 5 percent higher than the March quarter 2023. *Corporate sales include tickets sold to corporate contracted customers, including tickets for travel during and beyond the referenced time period Cost Performance and Outlook "For the March quarter, we delivered pre-tax income of $380 million, an improvement of $163 million over last year.  Delta's operational excellence resulted in the best March quarter completion factor in our history, providing an incremental point of capacity growth and unit cost favorability with non-fuel unit costs 1.5 percent higher than last year," said Dan Janki, Delta's chief financial officer.  "Growth is normalizing and we are in a period of optimization, with a focus on restoring our most profitable core hubs and delivering efficiency gains.  For the June quarter, non-fuel unit costs are expected to increase approximately 2 percent, consistent with our full year outlook for a low single-digit increase in non-fuel unit costs over 2023." March Quarter 2024 Cost Performance Operating expense of $13.1 billion and adjusted operating expense of $11.9 billion Adjusted non-fuel costs of $9.2 billion Non-fuel CASM was 14.08¢, an increase of 1.5 percent year-over-year Adjusted fuel expense of $2.6 billion was down 5 percent year-over-year Adjusted fuel price of $2.76 per gallon declined 10 percent year-over-year with a refinery benefit of 5¢ per gallon Fuel efficiency, defined as gallons per 1,000 ASMs, was 14.2, a 1.9 percent improvement year-over-year Balance Sheet, Cash and Liquidity "Delta delivered $1.4 billion of free cash flow in the March quarter after paying over $1 billion in profit sharing to our employees and reinvesting $1.1 billion in the business.  We repaid nearly $1 billion of debt and ended the quarter with 2.9x of leverage," Janki said.  "We expect to repay at least $4 billion of debt this year and are on track to improve full year leverage.  Our commitment to strengthening the balance sheet was recognized this quarter with positive outlook updates from Moody's and Fitch, marking our continued progress towards an investment grade rating." Adjusted net debt of $20.2 billion at March quarter end, a reduction of $1.2 billion from the end of 2023 Payments on debt and finance lease obligations for the March quarter of $712 million Weighted average interest rate of 4.5 percent with 91 percent fixed rate debt and 9 percent variable rate debt Adjusted operating cash flow in the March quarter of $2.5 billion, with gross capital expenditures of $1.1 billion, free cash flow was $1.4 billion Air Traffic Liability ended the quarter at $10.2 billion, up $3.1 billion compared to the end of 2023, a 45 percent increase Liquidity* of $7.4 billion at quarter-end, including $2.9 billion in undrawn revolver capacity *Includes cash and cash equivalents, short-term investments and undrawn revolving credit facilities March Quarter 2024 Highlights Operations, Network and Fleet Operated the most reliable airline among our competitors, ranking first in completion factor and on-time arrivals in the quarter, setting a Delta record for March quarter completion factor1 Recognized as the top U.S. airline by Wall Street Journal for a third consecutive year, ranking No. 1 in three of seven categories, including on-time arrivals and involuntary denied boardings Named 2024 Airline of the Year by aviation publication Air Transport World for Delta's outstanding operational performance, commitment to safety and premium customer service Took delivery of 7 new aircraft in the quarter, including the A321neo and A220-300, which are over 25 percent more fuel efficient than the aircraft they are replacing Announced that daily service between New York-JFK and Tel-Aviv (TLV) will resume in June Culture and People Celebrated Delta people with $1.4 billion in profit sharing for 2023 performance, paid on Valentine's Day Honored by Fortune as No. 11 on the World's Most Admired Companies list Named in Fortune's list of the 100 Best Companies to Work For Ranked No. 5 on Forbes' list of America's Best Large Employers out of 600 companies based on surveys of more than 170,000 U.S.-based employees Celebrated 40 years of partnership with the Atlanta Community Food Bank at volunteer events with Delta people and SkyMiles members Delta volunteers honored the life and legacy of Dr. Martin Luther King Jr. by participating in community service clean-up events at Flushing Meadows Park in Queens, NY and the BeltLine in Atlanta on MLK Day Customer Experience and Loyalty Re-launched Delta's co-brand credit cards with new benefits to provide customers with better experiences while traveling on Delta, staying in hotels, renting cars, traveling around town and dining out Achieved record quarterly American Express remuneration with increasing mix of premium card acquisitions Claimed the No. 2 spot on Fast Company's list of Most Innovative Companies in the travel category, for making fast and free Wi-Fi standard in the sky Named No. 10 on Food & Wine's list of Top Airlines for Food and Drinks, the only U.S. airline on the list Expanded the reach of fast, free Wi-Fi and Delta Sync on over 650 aircraft Announced a new premium Delta One lounge at New York-JFK that will debut in June 2024, spanning 38,000 square feet and featuring a year-round terrace, making it the largest club in Delta's network Provided SkyMiles members at the SXSW festival access to an elevated Delta lounge, a branded pop-up experience Environmental, Social and Governance Improved fuel efficiency by 1.9 percent year-over-year in the quarter, driven by fleet renewal and other cross-divisional sustainability initiatives As a founding member of the Minnesota SAF Hub, Delta supported Greater MSP in issuing a request for proposal for a site selection study for a dedicated alcohol-to-jet refinery site in Minnesota Launched a strategic partnership between Delta and the U.S. Army PaYS program, which partners with corporations to give enlisting soldiers and ROTC cadets access to interviews and potential full-time employment following service in the army Delta and LATAM joined forces with New World School of the Arts to give students an exclusive Job Shadow Day at Miami International Airport, introducing them to career opportunities in aviation Introduced "Delta Business Class" – a sports business immersion program leveraging Delta's partnerships with professional sports teams to create the opportunity for students at four Historically Black Colleges/Universities (HBCUs) to pursue sports-related careers 1FlightStats preliminary data for Delta flights mainline system and for Delta's competitive set (AA, UA, B6, AS, WN, and DL), from January 1 - March 31, 2024. On-time is defined as A0. March Quarter 2024 Results March quarter results have been adjusted primarily for the third-party refinery sales, unrealized gains/losses on investments and loss on extinguishment of debt as described in the reconciliations in Note A. GAAP $ Change % Change ($ in millions except per share and unit costs) 1Q24 1Q23 Operating income/(loss) 614 (277) 891 NM Operating margin 4.5 % (2.2) %       6.7     pts NM Pre-tax income/(loss) 122 (506) 628 NM Pre-tax margin 0.9 % (4.0) %       4.9     pts NM Net income/(loss) 37 (363) 400 NM Diluted earnings/(loss) per share 0.06 (0.57) 0.63 NM Operating revenue 13,748 12,759 989 8 % Total revenue per available seat mile (TRASM) (cents) 20.98 20.80 0.18 1 % Operating expense 13,134 13,036 98 1 % Cost per available seat mile (CASM) (cents) 20.04 21.25 (1.21) (6) % Fuel expense 2,598 2,676 (78) (3) % Average fuel price per gallon 2.79 3.01 (0.22) (7) % Operating cash flow 2,408 2,235 173 8 % Capital expenditures 1,193 1,000 193 19 % Total debt and finance lease obligations 19,364 21,958 (2,594) (12) %   Adjusted $ Change % Change ($ in millions except per share and unit costs) 1Q24 1Q23 Operating income 640 546 94 17 % Operating margin 5.1 % 4.6 %       0.5     pts 11 % Pre-tax income 380 217 163 75 % Pre-tax margin 3.0 % 1.8 %       1.2     pts 67 % Net income 288 163 125 77 % Diluted earnings per share 0.45 0.25 0.20 80 % Operating revenue 12,563 11,842 721 6 % TRASM (cents) 19.17 19.30 (0.13) (0.7) % Operating expense 11,923 11,296 627 6 % Non-fuel cost 9,227 8,506 721 8 % Non-fuel unit cost (CASM-Ex) (cents) 14.08 13.86 0.22 1.5 % Fuel expense 2,571 2,718 (147) (5) % Average fuel price per gallon 2.76 3.06 (0.30) (10) % Operating cash flow 2,478 2,942 (464) (16) % Free cash flow 1,378 1,853 (475) (26) % Gross capital expenditures 1,110 1,090 20 2 % Adjusted net debt 20,219 20,964 (745) (4) %   About Delta Air Lines  Through the warmth and service of Delta Air Lines (NYSE:DAL) people and the power of innovation, Delta never stops looking for ways to make every trip feel tailored to every customer.  There are 100,000 Delta people leading the way to deliver a world-class customer experience on over 4,000 daily flights to more than 290 destinations on six continents, connecting people to places and to each other.  Delta served more than 190 million customers in 2023 -- safely, reliably and with industry-leading customer service innovation – and was again recognized as North America's most on-time airline by Cirium. We remain committed to ensuring that the future of travel is connected, personalized and enjoyable. Our people's genuine and enduring motivation is to make every customer feel welcomed and respected across every point of their journey with us.  Headquartered in Atlanta, Delta operates significant hubs and key markets in Amsterdam, Atlanta, Bogota, Boston, Detroit, Lima, London-Heathrow, Los Angeles, Mexico City, Minneapolis-St. Paul, New York-JFK and LaGuardia, Paris-Charles de Gaulle, Salt Lake City, Santiago (Chile), Sao Paulo, Seattle, Seoul-Incheon and Tokyo.  As the leading global airline, Delta's mission to connect the world creates opportunities, fosters understanding and expands horizons by connecting people and communities to each other and to their own potential.  Powered by innovative and strategic partnerships with Aeromexico, Air France-KLM, China Eastern, Korean Air, LATAM, Virgin Atlantic and WestJet, Delta brings more choice and competition to customers worldwide. Delta's premium product line is elevated by its unique partnership with Wheels Up Experience.  Delta is America's most-awarded airline thanks to the dedication, passion and professionalism of its people. It has been recognized by Cirium for operational excellence; as the top U.S. airline by the Wall Street Journal; among Fast Company's Most Innovative Companies; the World's Most Admired Airline according to Fortune; as one of Glassdoor's Best Places to Work; and a top employer for diversity, veterans and best workplaces for women by Forbes. Forward Looking Statements Statements made in this press release that are not historical facts, including statements regarding our estimates, expectations, beliefs, intentions, projections, goals, aspirations, commitments or strategies for the future, should be considered "forward-looking statements" under the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Such statements are not guarantees or promised outcomes and should not be construed as such. All forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from the estimates, expectations, beliefs, intentions, projections, goals, aspirations, commitments and strategies reflected in or suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, the possible effects of serious accidents involving our aircraft or aircraft of our airline partners; breaches or lapses in the security of technology systems we use and rely on, which could compromise the data stored within them, as well as failure to comply with evolving global privacy and security regulatory obligations or adequately address increasing customer focus on privacy issues and data security; disruptions in our information technology infrastructure; our dependence on technology in our operations; increases in the cost of aircraft fuel; extended disruptions in the supply of aircraft fuel, including from Monroe Energy, LLC ("Monroe"), a wholly-owned subsidiary of Delta that operates the Trainer refinery; failure to receive the expected results or returns from our commercial relationships with airlines in other parts of the world and the investments we have in certain of those airlines; the effects of a significant disruption in the operations or performance of third parties on which we rely; failure to comply with the financial and other covenants in our financing agreements; labor issues; the effects on our business of seasonality and other factors beyond our control, such as changes in value in our equity investments, severe weather conditions, natural disasters or other environmental events, including from the impact of climate change; failure or inability of insurance to cover a significant liability at Monroe's refinery; failure to comply with existing and future environmental regulations to which Monroe's refinery operations are subject, including costs related to compliance with renewable fuel standard regulations; significant damage to our reputation and brand, including from exposure to significant adverse publicity or inability to achieve certain sustainability goals; our ability to retain senior management and other key employees, and to maintain our company culture; disease outbreaks, such as the COVID-19 pandemic or similar public health threats, and measures implemented to combat them; the effects of terrorist attacks, geopolitical conflict or security events; competitive conditions in the airline industry; extended interruptions or disruptions in service at major airports at which we operate or significant problems associated with types of aircraft or engines we operate; the effects of extensive government regulation we are subject to; the impact of environmental regulation, including but not limited to regulation of hazardous substances, increased regulation to reduce emissions and other risks associated with climate change, and the cost of compliance with more stringent environmental regulations; and unfavorable economic or political conditions in the markets in which we operate or volatility in currency exchange rates. Additional information concerning risks and uncertainties that could cause differences between actual results and forward-looking statements is contained in our Securities and Exchange Commission filings, including our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. Caution should be taken not to place undue reliance on our forward-looking statements, which represent our views only as of the date of this press release, and which we undertake no obligation to update except to the extent required by law.   DELTA AIR LINES, INC. Consolidated Statements of Operations (Unaudited) Three Months Ended March 31, (in millions, except per share data) 2024 2023 $ Change % Change Operating Revenue: Passenger $      11,131 $      10,411 $           720 7 % Cargo 178 209 (31) (15) % Other 2,439 2,139 300 14 %           Total operating revenue 13,748 12,759 989 8 % Operating Expense: Salaries and related costs 3,791 3,386 405 12 % Aircraft fuel and related taxes 2,598 2,676 (78) (3) % Ancillary businesses and refinery 1,370 1,125 245 22 % Contracted services 1,024 1,010 14 1 % Landing fees and other rents 748 584 164 28 % Aircraft maintenance materials and outside repairs 679 585 94 16 % Depreciation and amortization 615 564 51 9 % Regional carrier expense 550 559 (9) (2) % Passenger commissions and other selling expenses 550 500 50 10 % Passenger service 413 416 (3) (1) % Aircraft rent 136 132 4 3 % Profit sharing 125 72 53 74 % Pilot agreement and related expenses — 864 (864) NM Other 535 563 (28) (5) %      Total operating expense 13,134 13,036 98 1 % Operating Income/(Loss) 614 (277) 891 NM Non-Operating Expense: Interest expense, net (205) (227) 22 (10) % Gain/(loss) on investments, net (227) 122 (349) NM Loss on extinguishment of debt (4) (22) 18 (82) % Miscellaneous, net (56) (102) 46 (45) %      Total non-operating expense, net (492) (229)