The aviation industry suffered losses due to the coronavirus pandemic, as for several months international air travel all but disappeared in most countries. This week, Delta Air Lines posted another multibillion-dollar net loss after the coronavirus pandemic affected what is usually a peak summer travel period. Hopefully, travelers not only in the U.S. but in other countries as well, are getting more comfortable flying and this is good news.
According to Delta Air Lines, it could take years for sales to return to the pre-coronavirus period.
It is worth noting that, in the third quarter, the carrier’s net loss was quite high $5.4 billion. For example, during the same period of time in 2019, the company generated profits of more than $1 billion. Moreover, including its second-quarter results, Delta lost more than $11 billion so far, and this fact once more underlines the severity of the problem.
Importantly, revenue fell 76% from $12.56 billion a year earlier to $3.06 billion in three months in the three months that ended on September 30. According to the Delta’s President, revenues may not normalize for two years or more.
Delta and its results
The coronavirus pandemic seriously affected not only the Delta Air Lines but the industry in general. In the past, the carrier as well as other airlines used to rely on business travel and sprawling international networks. However, the coronavirus pandemic changed the situation.
Let’s have a look at the results to learn more about the situation. For example, earnings per share. The company reported a loss of $3.30 and this result surpassed expectations. Moreover, the revenue also failed to meet expectations.
Interestingly, more airlines are competing for price-sensitive leisure travelers within the country. However, the demand struggled, despite an uptick from multi-decade lows hit in April.
For instance, the Transportation Security Administration (TSA) screened nearly 64 million people at U.S. airports in the third quarter. This result is higher when compared to the second quarter. Nevertheless, in the third quarter of 2019, TSA screened 221 million passengers.
Delta and its competitors are trying to attract passengers with enhanced cleaning procedures and other policies. For example, the carrier leaves middle seats open on flights.
Moreover, Delta works hard to reduce costs. In recent months, the carrier retired dozens of aircraft. Furthermore, about 18,000 Delta employees, about a fifth of its pre-pandemic workforce, accepted buyouts and early retirement packages.
Interestingly, on an adjusted basis, Delta lost $3.30 per share, more than expected by analysts.