Delta Air Lines (NYSE: DAL) posted fourth-quarter earnings that beat Wall Street's expectations and raised its 2018 guidance about 20% sending shares higher.
The second-largest U.S. airline reported earnings per share of 96 cents U.S. on an adjusted basis revenue of $10.2 billion. Analysts polled by Thomson Reuters expected earnings of 88 cents a share.
Delta raised its full-year estimates for 2018 from $6.35 a share to $6.70 a share because of benefits from the new tax law, the airline's CEO Ed Bastian said. During an investor day last month, the airline forecast earnings per share for 2018 of $5.35 to $5.70 for 2018.
The cut in taxes will help the company offset some of the impact from higher fuel costs.
On a call later on Thursday, Delta executives will likely address the impact from a powerful winter storm and resulting travel chaos at New York's John F. Kennedy International Airport, a major hub for Delta, as well as an ongoing trade dispute between two Delta suppliers: Boeing (NYSE: BA) and Canada's Bombardier.
Delta said improving revenue and the new tax law will help the company offset some of the impact from higher fuel costs in the current quarter.
According to CEO Ed Bastian, "Delta people rose to the challenges of 2017 to produce solid financial results, industry leading operational reliability and strong improvements in customer satisfaction, and it's an honor to recognize their achievements with $1.1 billion in profit sharing.
"Looking ahead to 2018, we expect to drive solid earnings growth by growing our top line 4% to 6%, improving our cost trajectory and integrating our international partner network.
“As a result, we are able to increase our previous full-year guidance to $6.35 to $6.70 per share due to additional benefits from tax reform."
Shares in Delta opened Thursday trading up $1.02, or 1.8%, to $56.99
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