Delta President Hauenstein stated that a recent survey of Delta's corporate clients showed that a significant majority expected their travel to remain stable or increase as they moved into the fourth quarter and into 2024.
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GLODuring the third quarter earnings call on Thursday, Delta Air Lines executives mentioned that the demand for corporate travel had been steadily improving, particularly as companies continued their return-to-office initiatives. This reaffirmed what they had previously stated in the last quarter.
Although no one on the call shared specific figures regarding the volume or revenue recovery, CEO Ed Bastian noted that corporate travel has been experiencing a pattern of returning, plateauing, and then returning again, with expectations of another wave of return in the future.
Bastian emphasized that this pattern is one of the distinguishing factors setting Delta apart from some carriers on the lower fare spectrum and contributes to their ability to grow revenue at the current pace.
Delta reported a total third-quarter revenue of $15.5 billion, marking an 11% increase from the previous year. Passenger revenue reached $13.1 billion, representing a 14% year-over-year growth.
Delta President Glen Hauenstein pointed out that sectors like technology and financial services, which had been slower to recover, experienced double-digit growth during the quarter. He also noted that disruptions in the entertainment and automotive industries had affected business travel to and from Los Angeles and Detroit.
However, Hauenstein stated that a recent survey of Delta’s corporate clients showed that a significant majority expected their travel to remain stable or increase as they moved into the fourth quarter and into 2024. Demand from small and midsize companies and “hybrid travelers” remained higher than 2019 levels.
Bastian also mentioned that Delta was reassessing proposed changes to SkyMiles status earning requirements, with the expectation of providing more information in the near future. He acknowledged receiving both positive and negative feedback in response to the earlier announcement but emphasized the need for action to align customer numbers with the available premium assets.
In terms of financial performance, Delta reported third-quarter net income of $1.1 billion, a 59% increase from Q3 2022. The company’s guidance included a projected 9-12% year-over-year increase in fourth-quarter revenue and a projected 20% increase in full-year revenue.
