ATLANTA — Atlanta-based Delta Air Lines announces its second quarter earnings surpassed its goals.
According to the company’s earnings report, Delta’s net income was $1.6 billion.
But despite the billions coming in, profits are down compared to last year.
Revenue grew 14% in the June quarter, at the high end of expectations, increasing more than $2 billion over last year.
Channel 2’s Michael Doudna said Delta says so much of this comes down to fuel costs.
No airline generates more money than Atlanta-based Delta Air Lines, but they are finding sky-high fuel costs, which are cutting profits.
“I can see that happening as well because I’ve made a little bit more money this year. And due to gas, I have spent it out at the same time,” Teneica Isom said.
In all, reports show revenue climbed to $ 19.8 billion, but profit was down 25%.
Emory professor Ramnath Chellappa says fuel is the biggest variable for airlines and can be make-or-break, and with the war overseas, airlines have spent $6.66 billion on fuel costs so far this year, up nearly 84% from the previous year.
“The truth of the matter is given the huge variance that we observe in fuel prices, we are observing huge variability in the cost,” Chellappa said.
On an earnings call Friday, Delta officials stressed the focus on generating more revenue.
This week, Delta started offering up to 12 different seating options per flight, trying to attract both bargain hunters and those looking for a premium experience.
“It’s basically a mechanism for not leaving any money on the table, right?” Chellappa said.
Put simply, every seat level, from economy to Delta One, can have a basic, classic and extra version.
The company is hoping to attract more customers while dealing with an uncertain fuel future.
The basic—the cheapest — is offering only the onboard experience but none of the other perks, from extra customer service, to bags, to lounge access.
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