Delta’s 2023 earnings forecast calls for “solid” travel demand.

Delta Air Lines Airbus A330-300 landing at Athens International Airport AIA, LGAV / ATH Eleftherios Venizelos, registration N806NW, a former Northwest Airlines aircraft.

Nicolas Economou NurPhoto | Getty Images

Delta Air Lines says the travel boom isn’t over.

The airline expects its adjusted earnings to nearly double to $6 a share next year, beating analysts’ estimates. It forecast a 15% to 20% increase in revenue by 2023 from this year, which is expected to bring in roughly $45.5 billion.

Free cash flow is likely to rise from more than $2 billion next year to more than $4 billion in 2024, a sharp turnaround from 2020 when Delta posted a record loss.. Delta plans to pay down more of its debt over the next two years.

“Demand for air travel remains strong as we exit the year, and Delta’s momentum is building,” Delta CEO Ed Bastian said in a statement Wednesday ahead of an investor presentation at midday.

Delta shares gained more than 3% in premarket trading after the release.

The U.S. airline industry returned to profitability this year thanks to a strong rebound in travel demand and consumers’ willingness to pay higher fares, which helped carriers more than offset rising costs as the fuel

Airlines have cut some routes and been forced to limit capacity growth, which has kept fares steady. Supply chain and labor constraints have delayed deliveries of new aircraft, and airlines continue to struggle with a shortage of trained pilots.

Delta and other airline executives in recent weeks have been upbeat about travel demand, despite warnings from other industries about expected economic weakness.

Delta on Wednesday raised its fourth-quarter earnings forecast to a range of $1.35 to $1.40 per share, up from its previous outlook of $1 to $1.25 per share. Total revenue is expected to be 7% to 8% higher than Q4 2019, before the Covid pandemic.

Delta executives are likely to face questions Wednesday about costs, a preliminary new pilot labor agreement, fleet planning, demand for business travel, its loyalty program and the preparation that are to face a possible economic recession.

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