Delta CEO Sees No Cracks in Travel Demand, but Sky-High Fuel Bills Spoil the Party

Delta Air Lines, Inc. (NYSE:DAL) stock fell Friday after the airline reported third-quarter 2026 results that beat Wall Street’s revenue estimate but missed adjusted earnings expectations.

The company also cut its full-year earnings outlook as higher fuel costs continued to pressure profitability.

Revenue Rises, but Earnings Miss Estimates

Delta reported adjusted earnings of $1.72 per share, missing the $1.81 estimate. Revenue rose 21% year over year to $20.186 billion, beating the $17.654 billion estimate.

Adjusted operating revenue climbed 16% to a record $17.585 billion, while passenger revenue increased 15% to $15.534 billion.

Premium-ticket revenue rose 18% to $6.818 billion, while Main Cabin revenue grew 12% to $6.802 billion.

However, adjusted operating margin narrowed to 9.4% from 11.1% a year earlier.

Higher Fuel Costs Squeeze Margins

Adjusted fuel expenses surged 62% to $4.143 billion as the average fuel price increased 60% to $3.61 per gallon.

CFO Erik Snell said the company’s quarterly earnings absorbed more than $500 million in additional fuel costs compared with its early July forecast.

Meanwhile, operating cash flow totaled $1.713 billion, while free cash flow reached $463 million.

Delta ended the quarter with $3.787 billion in cash and cash equivalents.

Delta Slashes 2026 Earnings Forecast

Delta lowered its full-year adjusted earnings forecast to $5.10-$5.60 per share from $6.50-$7.50, compared with the $5.59 estimate.

For the fourth quarter, the airline expects adjusted earnings of $1.15-$1.65 per share, compared with the $1.51 estimate.

Delta also projects revenue of $17.527 billion, above the $17.192 billion estimate, and an operating margin of 7%-9%.

The outlook assumes fuel costs of about $4.25 per gallon.

CEO Ed Bastian said Delta expects approximately $4.5 billion in full-year pretax profit despite absorbing a $6 billion increase in fuel costs.

The airline also expects about $2.5 billion in free cash flow and plans to repay more than $2 billion in debt this year.

DAL Price Action: Delta Air Lines shares fell 4.43% to $78.50 in Friday’s premarket trading, according to Benzinga Pro data.

Photo via Shutterstock

Read Next

Trading Ideas

Delta Air Lines Q3 Preview: Stock Gains Since Iran War Rare for Sector, Will They Continue?

As other airline stocks fall since the Iran War began, Delta Air Lines stock is up. Will this continue after Q3 results?

3 min read

Read this article