Delta Air Lines (NYSE:DAL) reported today that it lost $6.9 billion in the third quarter, worse than what analysts expected, as the coronavirus pandemic continues to take its toll on the aviation sector.
Airlines have seen travel demand plummet due to the pandemic. Investors came into earnings season expecting massive losses, but were eager to see exactly how bad conditions are and to hear management commentary on what comes next.
Delta posted a loss of $3.30 per share on total revenue of $3.1 billion, missing the consensus estimate for a loss of $3 per share; revenue was in line with expectations. The airline burned through $24 million per day in the quarter, but ended it with $21.6 billion in liquidity.
Adjusted operating revenue of $2.6 billion was down 79% from the 2019 third quarter, with passenger revenue down 83%. Delta isn't expecting a rebound anytime soon, but it is trying to position itself to benefit as demand slowly returns.
"While it may be two years or more until we see a normalized revenue environment, by restoring customer confidence in travel and building customer loyalty now, we are creating the foundation for sustainable future revenue growth," Delta president Glen Hauenstein said in a statement.
Shares were down nearly 3% in pre-market trading following the earnings release.
The airline said it is cutting back on the size of its fleet due to weaker demand. Delta has restructured its order book to reduce aircraft purchases by more than $2 billion in 2020 and by more than $5 billion through 2022, deferring orders for new planes from Airbus (OTC:EADSY) and others.