Delta Air Lines on Friday reported that cargo revenue during the fourth quarter fell 24% year over year to $188 million, but the result represented an improvement from the rest of 2023.
As the first publicly traded airline to report earnings each quarter, Atlanta-based Delta (NYSE: DAL) serves as a harbinger of what to expect across the industry. Delta’s cargo results suggest it caught a bit of a tailwind during the fourth quarter, when a mini-surge of demand for e-commerce and other shipments pulled the market into positive territory for the first time in nearly 18 months.
Delta recorded year-over-year declines in cargo revenue ranging from 28% to 37% in the prior three quarters. For the full year, Delta’s cargo sales were down 31% to $723 million. The fourth quarter is typically the strongest period for air logistics companies because of seasonal shipping patterns leading up to big holiday shopping events.
The first quarter is normally slower for air cargo carriers, but disruption of shipping through the Red Sea could benefit air carriers this year.
Delta Cargo informed customers that it will not accept most specialty shipments in Chicago from noon on Friday until noon on Saturday because of a blizzard in the area. Weather conditions are also limiting some types of shipments at its facilities in Detroit and Dallas-Fort Worth, it said.
Delta said fourth-quarter revenue across the enterprise rose 6% to a record $14.2 billion, ahead of expectations by $420 million, on strong holiday travel demand, a 25% jump in international travel year over year and accelerating corporate sales. It posted net income of $2 billion, up from $828 million a year ago. But a slight lowering of earnings projections for the first quarter sent shares down on Wall Street.
Delta also announced it will buy 20 A350-1000 passenger aircraft from Airbus and take options for 20 more of the long-haul jetliners. The company already operates the smaller A350-900.
Click here for more FreightWaves/American Shipper articles by Eric Kulisch.
Contact reporter: ekulisch@freightwaves.com
RECOMMENDED READING:
Air cargo market: From ‘doom mongering’ to stability
Delta Air Lines cargo revenue drops 36% on slow freight demand