Delta’s president says the days of winning with the cheapest fares are over, and explains how investing in premium products – and then merchandising them – is getting flyers to pay more and driving record profits.
Airline President Glen Hauenstein shared an interesting observation about how passengers buy airfare today at the Morgan Stanley Laguna Conference on Thursday.
- It used to be that the lowest-cost competitor won. Spirit and Frontier had the highest margins.
- Now winning means generating the highest revenue from premium products. The airline that offers the best experience generates the highest margins because customers are willing to pay up for ‘the best’.
He says Delta is now making the most money on what’s normally thought of as a highly competitive route, New York – Los Angeles. And that’s because they are investing the most in the (ground) experience on both sides of that.
Delta One on both sides with the private security lanes in L.A. and in New York. Our most profitable market last month was JFK [ LA ] and it’s increased despite the fact that those costs are now embedded in it, the profitability has increased substantially over last year.
And I think when you think about what do consumers really want, they want the best, right? And when you produce the best, you can tell, and they react. And so we have a lot of work to continue to do. We’re always striving to be better and consumers have historically reacted incredibly well to that, and we’re going to continue on that path. They’ll tell us when they’re done.
Customers used to buy air travel on schedule and price. There are three reasons for this, and why it’s changed:
- The products themselves weren’t distinguishable, and no airline really had a brand that said ‘this is going to be consistently better than what you’ll buy from someone else’.
- Airlines sold their products on schedule and price. They didn’t really lead with what separated out their product from other airlines (or one product from another) at the same airline. Part of that was just the technology being used for the selling – it was all organized around schedule and price, not product attributes.
- Customers themselves have gotten pickier and more willing to pay for experiences. That’s not new since the pandemic, though it’s certainly accelerated. Not unrelated, the U.S. is wealthy is keeps getting wealthier.
Over 1/3 of American families now have over $150,000 of income, the first time in history (yes, it's adjusted for inflation) pic.twitter.com/MKYTxDQ3GS
— Jeremy Horpedahl (@jmhorp) September 9, 2025
Delta started to realize this trend a decade ago, which makes sense.
Is the Great Stagnation over? When @tylercowen wrote his book on the topic, a key chart (not the only evidence, but it was key) showed GDP/capita growing much faster than Median Family Income starting around 1973. But if we index to 2010 or so, we see them moving together again! pic.twitter.com/IBDthjo7p3
— Jeremy Horpedahl (@jmhorp) September 10, 2025
So the theme of Delta’s remarks to investors was, how do we offer more premium products and convince customers to pay us even more money?
They aren’t just selling to corporate travelers anymore on managed contracts, where their employer sends them out on a preferred airline. In fact, Delta admits that corporate travel hasn’t gotten back to pre-pandemic levels (let alone returning to trend, where business travel would have been in 2025 if trends had continued).
That’s obvious – the Monday to Thursday consultant flying out to work on-site with clients doesn’t exist the same way any more. When the clients aren’t in-office every day and when zoom has taken the place of some meetings at the margin, you aren’t going to get back to where you were. But Delta is honest about it.
I think one of the things you have to recognize is we’re still not back to corporate at pre-pandemic levels. So everything else is far ahead in that space.
There are implications to this. People aren’t just buying tickets following a travel policy. Customers have some discretion.
So the airline has a plan to ‘unbundle’ business class, degrading the experience unless you pay more. And they are branding their fares for each product under the rubric of ‘good, better, best’ so you have three choics for what to buy (and buy up to). They’re adding premium seats to aircraft to sell more, and they’ll be selling them at more price points.
The idea is to get people to pay up for what they value, and they’re going to be “announcing tests” for how they’ll do this in the coming weeks.
Well, I’d say we’re not done making premium products more accessible. And this fall, we’ll be announcing tests of different products and services, so that we can ascribe value to fare paid. And I think if you go back in the industry 20 years ago, the problem with it was that there was no — you paid a higher fare and you got no value, right? So when you were going to a cocktail party 20 years ago, you would say, how much did you pay to go to Florida this year, people would say $79, and they’d be proud of it.
And I think that’s because the industry didn’t put value in paying more than $79. And you’ve seen those conversations shift to I fly Delta and I fly these classes of service. And as we continue to bring more classes of service, more ways to get there, this is an evolution. And it’s going to — it’s taken — we’re mid-innings in this, and we have a lot to go to continue to provide value to customers for higher fares.
Delta’s CFO specifically called out that they’re going to expand the extra-legroom coach Comfort+ product and “iterate on” it “to bring more options to customers.”
And as we continue to reengineer how we think about selling tickets, you’ll see us come up with more creative solutions here that try and value what consumers value so that when they pay a higher ticket price, they know they’re getting more value.
However, Hauenstein is mindful of testing to ensure that as they push customers more that they don’t dilute their brand in the process.
It’s great. I think there’s more room to go there. We’re working very hard, and we’re going to be very diligent. I think one thing we don’t want to do is we’ve got such a great brand right now is we don’t want to get sideways with our existing base. So this is going to be a test-and-learn project, and it’s going to be over time, and it will be a gentle test and learn and see what customers like.
And then if we see positive reactions to it like we have with the other tiers, is to continue to evolve those. And so that’s what we’re pretty excited about over the next 5 years is being able to really what we call internally merchandising 2.0 is — all we did was sell a train ticket 20 years ago. Now we want to sell experiences. We want to sell value. And we’re on that journey. There’s a lot of room to go.
Not as much related to premium, but still on the subject of customer choice and when they’re flying, Hauenstein shared that traditional airline seasonality has shifted. It used to be that summer was peak of peak, but that’s flatted out – spring and fall have improved, though. That’s great for airline costs as they generate more revenue, because the carrier doesn’t have to build an operation just for the spikes and maintain it through deep dips.
Well, summer — peak summer has become less profitable relatively and spring and fall have become more profitable. That’s airline networks planners dream that the seasons last longer and then you can rotate the airplanes easier and that you don’t have to create that peak of peak for Easter Sunday because a lot of those costs you carry for the whole year.
So the number of pilots that you have in any particular fleet is usually driven by the number of hours we’re going to fly in July because that’s the peak of the peak or historically it has been. And our ability to now smooth that out should give us better pilot utilization, for example, on a year-round basis. And so that’s the part — this isn’t by design. This is by the way consumers are reacting to the realities of what they see. But it’s a benefit, I think, medium and long term to airlines.
Airlines aren’t the first business to experience this! Retail makes most of its money and does most of its volume in the pre-Christmas holiday shopping people. Amazon had to build server and shipping capacity to meet that demand, but it meant they had excess capacity the rest of the year. It’s that excess server capacity that’s the origin story for their AWS business.
I’ll start this off with anecdotes and cherrypicked ‘data,’ just to get @Tim Dunn going…
I’ve been taking that ‘New York – Los Angeles’ route with Delta, American, United, and jetBlue, in each of their premium services. I prefer DeltaOne, Mint, Flagship First, and Polaris, in that order.
The new DeltaOne lounges (before departure AND on arrival) at both JFK and LAX are excellent (like, seriously, the best in the USA at the moment); Delta’s 764 on the JFK-LAX routes are their better aircraft (sometimes they’ll have a 763 or a332, which is not as ‘nice’ up-front). Either way, in Premium Select or even Economy, there are options in 2-2-2 and 2-3-2 on each of those aircraft that are ‘better’ for couples and those wanting to avoid middle seats.
If only jetBlue had actual lounges, because their Mint product, the seats (even the older Mint, though the newer transatlantic Mint is even better!), the food, etc. would otherwise be superior.
With American, the a321T is showing its age (broken seats), yet, it’s got so much premium, like, you can’t complain getting upgraded from 2-2 in Business to 1-1 in First. I’m looking forward to these new Flagship Suites (LXR, etc.). Otherwise, on lounges, Chelsea and Soho at JFK are great (there’s a reason for earning Platinum Pro and getting OW Emerald right there); however, what’s lacking is LAX… First Dining STILL closed? For real??
Finally, United, *sigh* fine… the 787 Polaris is nice, but their 772 with the 2-4-2 domestic rear-facing lie-flat is objectively ‘bad’ by comparison to all other options (sure, better than last row, middle seat in Economy, but still, folks pay good money for transcon premium). Yes, their 787 in Polaris is nice, and their 757 with the older 2-2 lie-flat is ‘fine,’ but wow, what a variety. And, unlike Delta and American, United does not include elevated lounge access on transcon… *facepalm*
@ Gary — This makes me laugh. People never learn, not even the guys at the top. Other than death and taxes, the most guaranteed thing is change. Hauensteun and Kirby are fools to use words like “never” and “always”. Warren Buffet is drooling at all the nonsensical talk today.
Delta Greed Strikes Again
200,000 Sky Pesos on Delta Atlanta to JFK.
It’s sad how far AA has fallen in JFK-LAX. Didn’t they used to be #1 in revenue in this route? But that’s AA these days.
@Allen
Atl-jfk I look to AF or VS for points flight. Otherwise SW to LGA and subway and Airtrain.
@ 1990 — Yep, lots of variety, which also ends up in the lots of variety in pricing. While the hred is knocking themselves out to pay top dollar to fly the latest business seat with a door, I will be fine paying 70% less to fly Mint with no lounge. 90% of the experience ia the same, and 100% of either is forgettable. I’ll keep my cash, thank you.
Although I will never set foot on a DL flight again, I find this to be ever so amusing. I will be waiting to see the outcome of his haughty words. Playing solely to the entitled may not work as well as he hopes.
There is hubris in Delta’s statement. To quote a proverb: “Pride goes before the fall”.
To be honest, I have a hard time telling the difference between the performances of one major USA airline vs. another. They all seem to be in a race to the bottom. And they quote statistics (ie There are three kinds of lies: lies, damned lies, and statistics) to say they are better than the other guys. To me, Delta has lead the race to the bottom. Well, I do not know if they actually “lead” the race to the bottom, but they are getting to the bottom really fast. For example:
–Skypeso. Delta lead with that. Everyone else followed.
–Delta is now working with Amex to fully coupon-ize and reduce the value the Delta Platinum card. All premium credit cards seems to be following, but the jury is out on that one.
–Getting the passenger to the destination. Delta decided that they were so good at flying, they would no longer accept passengers stranded by other airlines. All the airlines followed. Now if my plane doesn’t fly, I am stuck. Delta’s passengers are also hurt by that. I was going to the airport when the Cloudstrike disaster happened. I almost went home. However, my American flight was on time and empty. Delta was shut down for a long time. They could have rescheduled their passengers on other planes except they ended that policy. Recently, this type of situation has happened quite a bit.
–Weather. All the airlines claim that any delay is weather related. Delta is no different than others. My girlfriend was at JFK flying Delta. They cancelled that plane about 30 minutes before the flight due to the weather. Seriously, if it was the weather, they must have known the plane would not fly long before.
–She was in paid first class. Used to be that airlines would bend over backwards to put you in the same class of service. They would only rebook her in coach from LGA the next day, and did not even put her on the waiting list for First. There were First class seats available
–Baggage fees. Delta charges. That means that if you have a late boarded ticket, your carry on gets gate checked.
–Lounge access. Used to be, as an Amex Platinum, I got unlimited Delta Lounge access. No more.
@Gene – lounges at JFK and Boston coming soon enough! JetBlue tells me the 2025 plan for jfk remains on track.
@Gary Leff — That’s what I’ve been hearing, too, at least for JFK, with the new T5-6-7 set to open partially in 2026… yet, talk is cheap, and delays are often the norm, so time will tell. It was premature for jetBlue/Barclays to unveil their premium $495 AF card when lounges weren’t even ready. I can’t imagine more than a couple folks ever even opened that card…
AI will be used for to maximize seat revenue even more. For their FF base AI will be used to predict purchasing trends and willingness for example for paid upgrades based upon buying history.
Never in the history of marketing has a company with a miniscule quality advantage claimed to be so much better than their major competitors. I don’t fly JFK-LAX very often but, when I do, I mildly prefer DL economy over AA because I’m more likely to have an empty middle seat next to me because their bigger aircrafts often result in lower load factors. That’s not an advantage likely to result in great profitability. The rest is mostly puffery. Like AA’s JFK lounges are quite nice and extremely competitive.
If DL keeps stammering the same statements of superiority, they assume people will believe it in perpetuity. Then they will start trimming the product back to keep growing profits.
My company has about 4000 people on travel at any given time. I only travel about 8-10x a year now for work – and in every case where I used to fly DL, I can’t even select them because they are expensive and ‘out of policy’.
Fortunately, AS serves my city well, with directs to the US cities I am forced to frequent. I just avoid any AA connections and things usually go off without a hitch. Add in AA, and things go south.
DLs hubris could put them into AA peer group down the road.
Some time ago, I needed one more flight to make Presidential Platinum on Continental Airlines. I schedule a round trip to JFK-SFO. It was snowing, but planes were still flying. While I was in the waiting area, Continental cancelled the flight due to weather related concerns. [Now it is like, not our fault, go home or book a hotel on your own expense (S*ckers!)]. Continental was rebooking everyone on an American flight that was leaving shortly (remember Delta got rid of that type of rebooking).
I went to Continental agent and said I want to fly Continental only. So they put me into a town car from JFK to EWR at their expense. I flew EWR-SFO round trip and made Presidential Platinum.
Also, back then, all major airlines in the USA had extensive international networks. Flew Continental to Hong Kong and Europe many times. International networks are now reduced. Currently, all the major airlines in the USA are cut-rate discount operators now (like Spirit). It is just a question of which flavor discount airline wants to fly.
Delta going on about being a premium airline is a joke. They are just another Spirit, but with more efficient upsell, better advertising, corporate business, and further from bankruptcy (for now). Delta quoting statistics saying they are better than other major USA carriers is just sophistry.
@Other Just Saying — “[Now it is like, not our fault, go home or book a hotel on your own expense (S*ckers!)].” 100%. Which is why common sense air passenger rights protections are a necessity to balance the abuses in this industry. Can we not please at least legislate an equivalent to EU261 or Canada’s APPR?
Mark,
DL is, quite simply, generating the highest unit revenues because there are people that will spend what they want.
They are not stupid. If people quit flying with them or spend less, they will respond.
and the real surprise in all of this is that DL is saying – undoubtedly born out by data that will become public at some point – that it is doing as well as it is in the nation’s largest air travel market. When Delta rolled out the D1 lounge at JFK, it said it was doing it to elevate the travel experience. Many people criticized the 767s that fly the vast majority of DL’s JFK-LAX flights and yet they have not changed. Not only are the 767s still the same but DL is clearly winning even more high value travel in one of the most competitive and highest value markets in the US.
As much as some people hate to admit it, DL gets much more right than not only its competitors but also continues to take an even greater leadership position in the industry w/o talking incessantly about taking out its competitors.
Two years ago, I was on my way home from AMS via LHR on BA on a paid business class ticket. I arrived AMS to discover that all UK airports were shut because of a technical glitch in the National Air Traffic Services planning system.
At the BA check-in counter the staff shrugged, said there was nothing they could do and handed me a piece of paper smaller than a fortune cookie chit with a phone number for BA rebooking. I called the number and the stated wait time was hours. So I headed over to the AA counter where the last AA flight back to the US had finished check-in. The rep there was in the process of closing up for the day, but when I explained my situation she looked at my ticket (I’m Exec Plat) and immediately moved me onto a Delta flight home via MSP, up front. The process involved no begging on my part and took less than 5 minutes. I arrived within an hour of my originally scheduled landing time.
Point being, AA took care of me with no fuss. Granted, my status made a difference, as did my fare class. And AA hasn’t always come through for me in similar situations, though it does about 90% of the time. But this agent allowed me to interrupt closing up shop and did it gracefully and without question. That wins my loyalty.
Would the reverse have been true if I were flying KLM/Delta?
Delta’s going to have to do a lot better than it is doing if it wants my “premium” business. When I flew Delta First a few weeks ago (from SEA to LAX) the seat was broken, and when I flew the connecting flight from LAX the tray table was broken. And neither legs had anything special about it. It may, however, be as much a country-wide problem as a specific Delta problem. Most other US carriers are even worse. Even an economy fare on a good European carrier would have been much more comfortable and appealing. If Americans are earning more, they’re certainly not demanding from carriers what their money can get them.
@ Tim — You are so full of **it.
Separately, naturally, it’s been widely reported that DL is worried internally over the weakness in Main Cabin revenues.
Delta always maintains the conceit that “they don’t need” Main Cabin flyers to make the model work, but the reality is that the Premium Segment is only so big. They’ve plateau’d there and now are reduced to trying to come up with a credit card product MORE expensive than their $650 wonder card. Meanwhile, naturally, the Faux Premium Pax are asking why they were promised certain perks, like unlimited lounge access, only to find that those perks are being restricted.
Equity analysts’ bottom– In this cycle, the DL model is past its prime. The airline has the most exposure (assuming Spirit finally dissolves) to economic downturn, recession and the inevitable cutbacks in Corporate Travel Departments– which gave Delta a momentary bump.
Yes the end of low fares has long been over @ de,ta just as there has been no value in their program for years.However plenty of discounted fares elsewhere
Perhaps they are celebrating the hopeful demise of spirit to Jack fares sky high along with AI
Good luck to them
@Diego Dave
Just remember, NOBODY is worse in IROPS than Delta and their partners.
I’ve had the same experience (Exec Plat) on AA– they’ll always do what it takes, even if it means pulling inventory from another carrier to get you there. UAL? Similar, with Two Million Mile status, I’m always on the top of the list. UA even upgraded me during COVID every time going back to Hawaii– even on BE fares, which they officially claimed not to do.
Delta? Good luck. Get in line with the other 700,000 schmucks, like the hordes DL stranded during Crowdstrike.
Nobody is worse in IROPS than the doofuses of Delta.
@Dwondermeant
I have high hopes for Alaska as our new “fallback” airline. Post HA merger? They plan major expansions– and seem focused on the mid-market.
Better loyalty program, better fare structures and fewer DL-style First Cabin Catfights on YouTube.
I’d pay zero attention to Delta if it weren’t for the Brawls-on-YouTube-from-Delta-None
Tom
I’m not sure how you can write what you have if you remotely read what even Gary reported. And the transcript of the conference is on DL’s IR site.
DL never said it doesn’t need economy passengers; feel free to post an SEC filed document that says that.
DL said that corporate travel is strong going into the fall including on the domestic system. very little corporate traffic books premium cabins.
Every Wall Street analyst recognizes that DL has the best balance sheet and earnings of the big 4; WN has a better balance sheet but not the earnings to go with it right now. DL and WN have investment grade balance sheets while DL has industry-leading revenues.
DL will be the last man standing, including beside UA which has committed to capex at near 100% of its annual revenues, an unheard of number for an industry with such low margins.
Dunn said: “DL will be the last man standing,”
LOL: O-M-G!!!, what a dystopian future!
just saying,
I don’t want any company to be the last standing in any industry but for someone to suggest that DL has the most exposure to an economic downturn is beyond laughable.
We just got through one of the worst downturns the industry faced w/ covid and DL and WN were set to survive; DL’s financial strength relative to the industry is stronger now than it was then.
UA is better off financially than they were during covid while a number of other airlines are worse off. and if there is a downturn UA’s massive orderbook will be a lead weight around its neck.
I realize this is just the internet where facts are meaningless but DL is far better positioned than most if not all of the US airline industry.
@ Tim — Yes, your cherry-picked “facts” are indeed meaningless.
Then counter them With what you believe to be the facts
I’m not convinced that worsening your customers experience is really a premium move.
@Diego Dave, @Tom Dually — Fellas, I couldn’t disagree more on IROPS and status. I’ve had top tier earn-able status on all three over the years (Diamond, EP, 1K, even Mosaic), and when things go wrong, most of the time, we’re screwed regardless. Sure, maybe a phone line is answered quicker, but it’s never ‘good enough’ these days. All of them.
Specifically, with American Airlines, when I was an Executive Platinum flying with a OneWorld partner (Finnair) that had a mechanical issue, Finnair basically abandoned us, overseas, and American couldn’t do anything to help, regardless of OneWorld Emerald. Ironically, I had to pay out of pocket for a SkyTeam partner’s alternative booking; Finnair and American refused to help beyond a refund. Atrocious.
Relatedly, does anyone have a referral for a lawyer who specializes in Montreal Convention Article 19 claims? My blood is boiling again, and I think I may want to sue an airline for damages. Only half kidding. I know, I know… credit card dispute, DOT complaint, then small claims court. I’m still within the 2 year statute of limitations… just wanna get reimbursed for my alternative transportation, ya know… oh, what’s that, go fly a kite, you say? Ah… status… so helpful…
@Tim Dunn — This is where Delta actually shined. Following Crowdstrike, they offered to reimburse for alternative transportation, when, for domestic flights affected, they may not have had to. So, when it comes to IROPS, again, all bad, but some better than others. I’d say DL has at least tried to ‘make things right’ whenever things go wrong. No, it’s never ‘enough,’ but still, trying is better than whatever happened to me with AA and AY. (Blood still slightly warmer than usual over here…)
@ Tim — I don’t need to repeat my opinions ad naseum like you. I don’t love any airline. In my opinion (and everyone is entitled to their own opinion), Delta is the most arrogant and dishonest of them all. The rest aren’t far behnid. I travel alot and spread my business around in an effort to maximize the value I receive for my hard-earned money. The airlines and other travel companies attempt to do the same for themsleves. I am not blindly loyal to any of them, unlike some people. Those are my facts.
Gene,
you countered w/ an opinion, not facts.
You are welcome to your opinion but that is far different from whether DL is more or less likely to be in distress in a downturn.
and, btw, I am not terribly brand loyal in the travel sector either precisely because I don’t think the rewards are worth it.
@1990
I’m well over 4 million miles, on basically everybody, and can tell hours worth of “here’s how had SAS was as a Star Alliance Partner” stories since I was going to see NOKIA in Finland monthly back in the day.
Yes, the “partnerships” fall apart in IROPS. SAS once insisted they were going to fly me on SAS metal to EWR… literally when Newark was in the midst of closing during Sandy. The GA eventually backed down, but it was ugly.
OTOH? Flying company metal inside the USA? NOBODY is worse than Delta when it goes bad, because they are structured NOT to respond well. Three days AFTER Crowdstrike? DL didn’t even know where over half their flight crews were. They had over 100,000 PAX still stranded in ATL a week later. 5000 missing UM kids. What a disaster.
Yes, they all have bad days. They all have terrible “alliance” partners– whose employees h8 the entitled PAX from the other carrier.
DL is on another level of bad, however.
I’ll fly DL point2point in good weather parts of the country. But I’m done FOREVER taking unscheduled overnight staycations in America’s Armpit (Atlanta) because of Delta’s incompetence in IROPS.
Even WN bought inventory from the Big Three to dig out of their system meltdown mess a couple of years ago. Delta? “Nah, we’ll just strand everybody until the capacity catches up in a week or two. Enjoy your ATL or DTW campout! Have some SkyPesos and a worthless voucher! Oh by the way, the re-booked re-booked flight is now canceled”
@1990
+++++”This is where Delta actually shined. Following Crowdstrike, they offered to reimburse for alternative transportation, when, for domestic flights affected, they may not have had to. +++++
You must be joking. They EVENTUALLY (keep in mind they Eff’d around for a week on this when everybody else was back to 100% within 18 hours) relented, but it took almost an act of Congress– and the DOT threatening– to get them to come to their senses.
For the first three days, the long-suffering Pax who finally threw in the towel and simply wanted a refund? The messages they got from DL were all to the effect that they could “re-book OR take a future travel credit”. Really. Somehow (funny how this happens on DL so much) they “forgot” they had a legal obligation to issue an immediate refund.
There are a few things to “like” about DL– but you are deluded if you want to use “their Crowdstrike response” as a proof point. They were still in impaired operations a week later.
Nothing about their response came about without the threats from DOT and Congress complaints about their poor performance.
There’s at least 700,000 people muttering “never again” after that week of Delta incompetence
@Tim Dunn
I dunno what you are dreaming, but Delta as much as told MorganStanley that their Main Cabin was severely underperforming already. UAL isn’t seeing the weakness there and it all points to Delta being unprepared for a weakening economy and slackening demand from the Premium-Corporate sector that’s been propping up a poor-performing mainline flight operation.
There’s only so much they can do heading into a down cycle, being overly dependent on fickle credit card products.
+++++++
Delta Air Lines (NYSE: DAL) highlighted a disappointing performance in transatlantic markets this summer when company leaders spoke at Morgan Stanley’s Laguna Conference this past week. The airline primarily noted that July-August was no longer the peak season for high-end European leisure travel, with premium revenue peaks pushing as far back as October. Well over half of Delta’s revenues now come from non-main-cabin revenue streams (specifically premiums and ancillaries), and main cabin margins were flat to down.
++++++ credit Simple Flying coverage
and, Tom, DL also said it expected to earn at the upper end of its guidance.
They also said that corporate travel – of which DL carries the most revenue among US airlines – has been strong in the second half of the summer and looks strong going into the fall.
Just because DL notes specific changes in its business does not make them weak.
and DL still has an ongoing lawsuit against CRWD. The story is not yet over. and DL’s traffic has increased so if some customers left, others started flying DL bringing the same amount of revenue. and DL and UA’s passenger revenue metrics have been pretty similar and above average for the industry for several years.
Wow, my home airline, what arrogance and pomposity.
You’re stuffing me into a metal tube for hours, in an uncomfortable seat, with mediocre food, to you get me from point A(tlanta) to point B. And you really think this is “experience”?! What hubris! My experience starts when I arrive there, provided you made it, and didn’t lose my luggage. DL’s management has lost their collective mind.
Bottom line:
DL promises to continue to over-charge me even more for flying them for >40 yrs, and the “privilege” of living in their fortress hub. Which makes me a lot LESS likely to pay for upgrade, or chase SkyPesos.
@Tim Dunn said:
++++++++++++
and, Tom, DL also said it expected to earn at the upper end of its guidance.
++++++++++++
I noticed you are over on Ben’s and Matthew’s sites talking up the same “upper end of the range” guidance. What you don’t seem to acknowledge is that the Street is reacting with a big ol’ yawn. Analysts have seen all this kabuki show before– and it boils down to one problem. On Wall Street the DAL “quality of revenue” is just perceived as inferior to United’s.
UAL’s seeing an 11 P/E when DAL’s perpetually at a lackluster 8.
The difference?
UAL generates the bulk of their margins from core business.
DAL generates the majority of O/M from non-core business.
Profit’s profit, I’ll grant you that. But DAL’s “profit” always has an odor to.
As a result? DAL’s P/E will always be handicapped for lower quality.
That is the harsh reality. It’s a flawed business model that will ultimately weigh on DAL’s stock.