The Manila Shake Up

Philippine Airlines and Cebu Pacific Have Switched Roles

Pushing Back: Inside the Issue

The Delta results are in. As expected, the Atlanta-based giant posted solid, if unspectacular, first quarter operating profits, underpinned by ongoing demand strength. Executives appeared as bullish as ever, with talk of “robust demand for summer travel.” As for anxiety about domestic demand perhaps weakening, President Glenn Hauenstein was quick to reply: “We don’t share that anxiety.”

In any case, international demand is unquestionably booming. And all the while, Delta’s free wi-fi product has been a “tremendous success,” its premium revenue is outperforming, its relationship with American Express is thriving, its corporate customers are returning, its overseas joint ventures are building momentum, and more of its bookings are coming via direct channels. Delta does without a doubt face cost headwinds. Its new pilot contract is expensive. And “aviation infrastructure is still fragile,” obstructing the airline’s efforts to optimize capacity and asset utilization. Still, it expects operating margin for the current April-June quarter to reach a lofty 15 percent, within striking distance of what it earned in the same quarter of 2019.

Delta’s Chicago-based rival United reports this week. As for other developments last week, AirAsia is starting to rebuild its network to China, Spirit Airlines has a new flight attendant contract, and Virgin Australia looks set for a share offering. Also in this week’s issue, we rank the world’s major publicly-traded airlines by their fourth quarter metrics, crowing Pegasus Airlines of Turkey the most profitable by operating margin (Panama's Copa was a close second). American remains the world’s largest airline by revenue. And two carriers from Thailand — Thai Airways and Bangkok Airways — rank among the top for most improved financially since 2019.

Airline Weekly Lounge Podcast

Delta Air Lines kicked off the first-quarter earnings season this week. Edward Russell and Jay Shabat discuss what they expect. Plus, can American Airlines catch up to the pack? Listen to this week’s episode, and find a full archive of the Lounge here.