Delta Cuts 2026 Profit Outlook as Fuel Costs Surge Despite Record September Revenue

ATLANTA — Delta Air Lines (DL) cut its 2026 profit outlook on October 9 as higher fuel costs squeezed margins despite record September-quarter revenue and growth in premium travel.

The airline now expects full-year adjusted earnings of US$5.10–US$5.60 per share, down from the US$6.50–US$7.50 range it reaffirmed in July. The midpoint falls to US$5.35 from US$7.00, a reduction of about 24%.

Adjusted fuel expense rose 62% from a year earlier to US$4.1bn. Chief Financial Officer Erik Snell attributed the forecast cut entirely to fuel costs, Reuters reported.

“All of it's fuel,” Snell told reporters, according to the news agency.

Revenue Rises, Margins Narrow

The Atlanta-based carrier reported US$17.6bn in adjusted operating revenue, up 16% from the September quarter of 2025. Its GAAP operating revenue, reported under generally accepted accounting principles, was US$20.2bn. The adjusted revenue figure excludes US$2.6bn in third-party refinery sales.

Adjusted operating income was US$1.7bn, with a 9.4% operating margin, down from 11.1% a year earlier. Adjusted earnings reached US$1.72 per share, compared with US$1.70 in the same quarter of 2025. GAAP earnings were US$1.15 per share.

Adjusted operating expenses grew 18%, faster than the 16% increase in adjusted revenue, leaving operating income slightly lower. Delta's adjusted non-fuel cost per available seat mile increased 7.3%, which it attributed primarily to higher crew and revenue-related costs, with an additional effect from summer storms. That measure excludes fuel, third-party refinery sales, expenses from its maintenance, repair and overhaul business, and profit sharing.

Premium Growth on Restrained Capacity

Premium revenue increased 18% on a 6% increase in premium seats. Total loyalty revenue also grew 18%, while maintenance, repair and overhaul revenue rose 28%. Premium products and other diversified revenue streams together accounted for 61% of adjusted operating revenue.

Adjusted total revenue per available seat mile increased 15% on broadly flat capacity. Domestic unit revenue rose 16%, and transatlantic unit revenue increased 11% from a year earlier.

The unit-revenue gains do not establish how much further fares can rise without affecting demand, or whether revenue growth will cover future cost increases.

The results follow the broader fuel-cost pressure on airlines that we covered in March. More recent Bureau of Transportation Statistics figures show scheduled U.S. airlines spent US$6.17bn on fuel in August, up 60.2% from a year earlier, while reported consumption fell 1.2%. Those industry totals cover fuel paid for by carriers and do not measure Delta's individual exposure.

Higher Fuel Assumption for Fourth Quarter

Delta expects an all-in fuel price of approximately US$4.25 per gallon in the December quarter, compared with its adjusted price of US$3.61 in the September quarter. The forecast uses the October 2 forward fuel-price curve and already includes an estimated refinery benefit of US$0.40 per gallon.

Reuters reported that Snell expects Delta's refinery outside Philadelphia to generate US$700m in profit this year. Refining earnings provide a partial offset to the airline's fuel bill, but the forecast still assumes a higher all-in price next quarter.

Delta projects approximately 20% adjusted revenue growth in the December quarter, with total seats growing less than 2% and Main Cabin seats declining. It expects an adjusted operating margin of 7%–9% and adjusted earnings of US$1.15–US$1.65 per share.

For the full year, the airline now forecasts approximately US$2.5bn in free cash flow, compared with US$3bn–US$4bn in July. Chief Executive Officer Ed Bastian said his airline expects roughly US$4.5bn in adjusted pre-tax profit while absorbing a US$6bn increase in fuel costs.