Delta stock falls after profit misses, but revenue rises above 2019 levels and beats expectations

Shares of Delta Air Lines Inc.
DAL,
+6.15%
dropped 1.2% in premarket trading Wednesday, after the air carrier reported second-quarter profit that fell well short of expectations but revenue that rose above pre-pandemic levels to beat forecasts. Net income of $735 million, or $1.15 a share, was down from $1.44 billion, or $2.21 a share, in the same period in 2019. Excluding nonrecurring items, adjusted earnings per share of $1.44 missed the FactSet consensus of $1.73. Revenue rose 10.3% above 2019 levels to $13.82 billion, beating the FactSet consensus of $12.37 billion. Meanwhile, total operating expenses jumped 18.2% from 2019, including a 40.7% increase in aircraft fuel and related tax expense, as operating margin of 11.0% missed guidance provided in June of “close to” 14%. Load factor fell to 87% from 88% in 2019 but beat the FactSet consensus of 85.5%, and free cash flow of $1.6 billion beat guidance of $1.5 billion. For the third quarter, Delta expects revenue to be 1% to 5% above 2019 levels, while the current FactSet consensus of $12.59 billion implies 0.3% growth. The stock has dropped 24.2% over the past three months through Tuesday while the U.S. Global Jets ETF
JETS,
+3.89%
has slumped 21.1% and the S&P 500
SPX,
-0.92%
has lost 14.1%.