By Alison Sider
Delta Air Lines expects a strong appetite for high-end travel to fuel profit in 2025, said Chief Executive Ed Bastian.
The forecast comes as the airline posted better-than-expected revenue growth in the latest quarter as demand picked up. The airline’s sales of premium products rose 8% while revenue from sales of main cabin tickets rose 2% in the fourth quarter.
Bastian said that the clarity of the election outcome helped restore travelers’ confidence and unleashed more corporate spending. The carrier said quarterly corporate sales rose 10% from a year earlier.
“Overall consumer demand, particularly premium demand, has also been very, very healthy through the holiday season,” Bastian said in an interview. “The outlook in the first quarter is quite good.”
Delta and United Airlines posted the U.S. airline industry’s biggest profits last year with a focus on upscale offerings for more affluent consumers.
— Delta on Friday reported record fourth-quarter revenue.
— Profit of $843 million was down 59% from a year earlier, when the airline reported a gain from an investment in private-jet membership company Wheels Up.
— On an adjusted basis, the Atlanta-based carrier reported earnings of $1.85 a share, beating the $1.76 expected among analysts polled by FactSet.
— The airline expects adjusted first-quarter profit to be between 70 cents and $1 a share.
A glut of cheap seats weighed on airfares during much of last year, but that changed as carriers-led by discounters-pulled back on money-losing flying. Industry analysts say more restrained supply is now helping to boost airline revenue and bolstering fares.
“That sets an industry backdrop that is really healthy,” Bastian said.