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Earnings analysis · 10-Q

DAL earnings analysis

Filed October 9, 2026 · Our reading of the company's report

The latest report

Delta delivered strong demand and revenue growth, with third-quarter operating revenue up 21% year over year to $20.186 billion, led by premium, main-cabin, loyalty, cargo, and MRO growth. However, fuel expense…

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Delta delivered strong demand and revenue growth, with third-quarter operating revenue up 21% year over year to $20.186 billion, led by premium, main-cabin, loyalty, cargo, and MRO growth. However, fuel expense increased 69%, total operating expense rose 25%, and operating income declined $230 million to $1.5 billion, compressing operating margin to approximately 7.4%. Liquidity and operating cash flow remain solid, but elevated fuel costs, cost inflation, investment losses, refinery disruption, and more than $5 billion of expected 2026 capital spending weigh on the outlook.

Read the original on SEC.gov

From revenue to operating profit

Where each $100 of revenue went in this report.

Of every $100 of revenue Cost of sales $3 Operating expenses $90 Left as operating profit $7

Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.

Where revenue came from

The business segments reported by the company.

Passenger revenue 67.1% Other revenue 18.8% Refinery segment 12.8% Cargo revenue 1.3%

Shares of the segments disclosed in this filing, largest first.

How we read each report

Our analysis across the last few reports.

Read as bullish Read as bearish Apr 2026 Oct 2026

Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.

Reported figures

Earnings per share
$1.72

What stood out

  • Record Revenue Driven by Broad Demand

    Total operating revenue increased to $20.186 billion, up $3.513 billion or 21% year over year. Passenger revenue rose 15% to $15.534 billion, with premium revenue up 18% and main-cabin revenue up 12%.

  • Revenue Growth Despite Margin Compression

    Operating income was $1.5 billion, down $230 million from the September 2025 quarter. Based on reported revenue, operating margin was approximately 7.4%, versus 10.1% in the prior-year quarter and 9.4% in the preceding quarter.

  • Broad-Based Passenger Demand

    Demand remained strong across geographies: domestic passenger revenue increased 16% on flat capacity, Atlantic revenue increased 11%, Latin America increased 14%, and Pacific increased 13%. Total passenger load factor remained 86%.

  • Positive Cash Generation

    Operating cash flow was $1.713 billion and free cash flow was $463 million in the quarter. Capital-intensive investing cash outflows were $1.303 billion, while nine-month capital expenditures reached $4.1 billion.

  • Liquidity Supported by Debt Reduction

    Liquidity was $6.9 billion at September 30, 2026, including approximately $3.1 billion of undrawn revolving credit capacity. Debt and finance-lease repayments totaled $1.2 billion in the quarter and $3.3 billion for the first nine months.

  • Loyalty Economics Continue to Strengthen

    Loyalty and related revenue increased 19% to $1.346 billion, supported by higher American Express card spend and new card acquisitions. American Express remuneration was $2.3 billion in the quarter and $6.9 billion year to date, up 14% year over year.

What to watch

  • Elevated Fuel Costs

    Aircraft fuel and related taxes increased $1.781 billion, or 69%, to $4.351 billion. The average fuel purchase price rose 63% year over year to $3.80 per gallon, and management anticipates elevated fuel costs will persist until market disruptions and geopolitical events are resolved.

  • Cost Inflation Outpaced Core Revenue

    Total operating expense rose $3.743 billion, or 25%, to $18.732 billion, outpacing adjusted revenue growth of 16%. CASM-Ex increased 7.3% to 14.03 cents, while salaries and related costs increased $379 million to $4.822 billion.

  • Investment Mark-to-Market Volatility

    Non-operating expense was $380 million, compared with $93 million of non-operating income in the prior-year quarter, primarily due to mark-to-market losses on equity investments. The nine-month investment result swung to a $419 million loss from $1.007 billion of income.

  • Refinery Outage and Profitability Risk

    The refinery generated a $33 million operating loss versus $53 million of operating income a year earlier, reflecting crude-price volatility and a temporary outage that began in June 2026. Although production returned to normal by quarter-end, profitability is not expected to resume until the December 2026 quarter.

  • High Aircraft Investment Commitments

    Capital intensity remains high: nine-month capital expenditures were $4.1 billion versus $3.6 billion a year earlier, and management expects 2026 capital spending to exceed $5 billion, primarily for aircraft, fleet modifications, and technology.

Management's outlook

The 10-Q does not provide explicit EPS or revenue guidance. Management states that 2026 capital spending is expected to be over $5 billion, fuel consumption should remain aligned with capacity changes for the remainder of 2026, elevated jet-fuel costs are anticipated to persist, and the refinery is expected to return to profitability in the December 2026 quarter.

Earlier filings 2

10-Q · July 10, 2026

Delta Air Lines reported strong revenue growth in Q2 2026, with total revenue reaching $19.8 billion, a notable increase of $3.1 billion year-over-year. The company surpassed EPS expectations, reporting $1.56 against…

10-Q · April 8, 2026

Delta reported consolidated operating revenue of $15,854 million for Q1 2026, up from $14,040 million in Q1 2025, but swung to a net loss of $(289) million (diluted EPS $(0.44)) from net income $240 million a year ago,…

This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.