Delta Air Lines Inc Q4 2024 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Catherine O'Brien - The Goldman Sachs Group, Inc. - Analyst : It's good to be back on one of these things. So (technical difficulty) [maybe just to start], I don't want to be greedy after the fourth quarter beat and fourth quarter revenue guide that was much higher than I was expecting. But I'd love to dig in on the greater piece of your greater than $735 million full year guide. And Dan hinted at a little bit in his prepared remarks, but if we can assume that your prior commentary around mid-single-digit revenue growth for the full year stands and you're starting off with high single-digit growth, would it be fair to assume that the $735 million has a pretty conservative back half revenue outlook baked in there? And then upside of potential revenue upside, what else drives that upside from the $735 million?

Question: Catherine O'Brien - The Goldman Sachs Group, Inc. - Analyst : That's great. Thanks. And then maybe one for Glen, a quick one. In the press release, you noted that all geographic entities came in stronger in the fourth quarter than you were initially expecting. Was there any one standout in terms of the magnitude of that improvement? And how do these trends inform your view on capacity allocation geographically over the course of 2025?

Question: Brandon Oglenski - Barclays Plc - Analyst : Congrats on the results today. Nice to see the market taking notice. Ed, definitely exciting at CES this week, and I know you guys announced a lot of new partnerships, but maybe can you elaborate more for investors how you plan to monetize SkyMiles going forward, especially with like Sync and some of the news you announced this week.

Question: Brandon Oglenski - Barclays Plc - Analyst : Definitely appreciate that, Ed. And then, Dan, can you give us some insight into some of the levers you're pulling this year on keeping CASM low single digits. Maybe we underappreciate how much like network restoration costs were in the last couple of years.

Question: Conor Cunningham - Melius Research LLC - Analyst : Going obviously, a really solid start for 1Q. But there's a lot of moving parts this year from the calendar, and I think you benefited from the max grounding last year. So your comps are actually particularly difficult. So shouldn't we expect a somewhat strong sequential acceleration into the spring? Just trying to understand if like your actual core results are even stronger than what you're reporting here today, even though those are really good, too, as well. Just any thoughts there. Thank you.

Question: Conor Cunningham - Melius Research LLC - Analyst : Helpful. And then I think a lot of (technical difficulty) -- just around the idea of like better supply in the US domestic market. But I think there's an argument to be made that there's an even better supply story on the international side. Widebodies are hard to come by, there's some engine issues there as well. Can you just talk about the international setup as you look from a supply standpoint and what that could mean for the Atlantic again this year?

Question: Thomas Fitzgerald - TD Cowen - Analyst : Could you maybe elaborate a little bit on what you're seeing across customer segments to business and leisure as well as by age cohort, so maybe boomers and Gen X versus some of the Millennials.

Question: Thomas Fitzgerald - TD Cowen - Analyst : And then just as a follow-up, I'd love to hear what you're seeing in some of your core hubs. We've seen, obviously, Southwest going back in Atlanta and a lot of the low cost and ultra-low-cost pulling back significantly out of places like Minneapolis. So curious just what you're seeing in bookings and yields there. Congrats on the quarter.

Question: Jamie Baker - JPMorgan Chase & Co. - Analyst : So this is probably for Glen. Dan might have thought as well. The topic is fuel recapture. At one point in the not too distant past, my professional lifetime, it could take up to a year for the industry to recalibrate the higher input costs, higher fuel costs. But given the evolution we've been on, it now seems like higher fuel can be recaptured somewhere inside of two quarters, okay. When we think about that past precedent, though, yield production was, I don't know, kind of modest. Whereas today, we're in a strong environment, at least in most markets. So that's my question. With yields already being pretty strong, do you think that alters the calculus? Does it make it harder and longer to recapture higher fuel? Or do we still get to that 100% recapture mark inside of a couple of quarters?

Question: Jamie Baker - JPMorgan Chase & Co. - Analyst : Excellent. And then just a quick follow-up on corporate. Post-COVID, Delta and some of your competitors have talked about changes in how business travelers are flying that's had some impact on -- they have weak demand, somewhat elongated booking curve. There is my question. As corporate continues to rebound, is corporate behavior beginning to revert back to the way that it used to be? Or are those behavioral trends that you're seeing today kind of consistent with the post-COVID world that we live in?

Question: Duane Pfennigwerth - Evercore ISI - Analyst : Just to maybe continue that theme. As we play back the fourth quarter, what was the revenue surprise really driven by? There was some stronger post-election trends, which obviously some of the hotels called out, but do you think the compressed period between Thanksgiving and peak holidays actually stimulated compression in corporate? And how would you mark that corporate recovery, excluding some of the seasonal noise into 2025? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 10, 2025 / 3:00PM, DAL.N - Q4 2024 Delta Air Lines Inc Earnings Call

Question: Duane Pfennigwerth - Evercore ISI - Analyst : That's helpful. And then just for a follow-up, Glen. In LATAM, what inning are we in for the rebuild of that entity? Delta has been in investment mode there for a while. When would you expect to enter harvest mode?

Question: Shannon Doherty - Deutsche Bank AG - Analyst : Maybe just one for Glen here. With premium revenue growth continuing to outpace main cabin, could it be possible that the RASM gap actually stays the same between [the Q], even as you're growing your premium seat mix just given higher yields and overall enhanced product offering?

Question: Shannon Doherty - Deutsche Bank AG - Analyst : As my follow-up here, what are your thoughts on some calendar shifts, a little later Easter this year? Could it be possible that if a RASM positive in both the March and June quarters as travelers take two trips this year instead of one with maybe to last year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 10, 2025 / 3:00PM, DAL.N - Q4 2024 Delta Air Lines Inc Earnings Call

Question: Ravi Shanker - Morgan Stanley & Co. LLC - Analyst : Glen, if I can revisit the topic of Europe, just this kind of unusual strength in 1Q, you elaborated on that a little bit. But are you confident that this is not pulling forward from later in the summer?

Question: Ravi Shanker - Morgan Stanley & Co. LLC - Analyst : I think a lot difference in the quarter of the food as well. Maybe as a follow-up, how do we think about the pricing algorithm between main cabin, mid-cabin and the front of the plane kind of as you talk about more momentum in main cabin RASM, like is that -- like do you adjust front of plan pricing kind of in real time to adjust for that? Or how do you see that flow through to the cabin? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 10, 2025 / 3:00PM, DAL.N - Q4 2024 Delta Air Lines Inc Earnings Call

Question: Andrew Didora - BofA Global Research - Analyst : I guess, Glen, maybe when we look out past one, the first quarter, I know it's early, but domestic schedule showing kind of high single-digit growth in 2Q, I guess, obviously, relatively high to the 3% to 4% full year outlook. But when I look historically, this can come in anywhere of 1 to 3 points. Do you think that's reasonable? And then any comments or color on how you think your capacity could trend throughout this year?

Question: Andrew Didora - BofA Global Research - Analyst : That's great color. And then maybe just sticking on the capacity front, obviously, you've spoken to, we've seen the strong trends in the Atlantic. Clearly, the demand is there. How should we think about your growth across the Atlantic this year? Will it be system average above or below? Just thinking about how that could trend as we progress through the year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 10, 2025 / 3:00PM, DAL.N - Q4 2024 Delta Air Lines Inc Earnings Call

Question: David Vernon - Bernstein Institutional Services LLC - Analyst : So Glen, going back to corporate demand right now, the 10% growth. Is there a way that you can help us understand kind of how much of that sort of volume, how much of that's yield? And then obviously, last year was a pretty interesting year for corporate growth with American taking a step back, Southwest participating more in GDS's, just trying to get a sense for maybe how share is trending in corporate from your perspective.

Question: David Vernon - Bernstein Institutional Services LLC - Analyst : Excellent. And then as you think about the ASM growth that you shaped for us, that was really helpful. Can you help us understand kind of the balance between international and domestic as we progress through the year?

Question: Savanthi Syth - Raymond James - Analyst : If I might on the CapEx front of the aircraft deliveries. I'm guessing your CapEx is still -- thinking is around $5 billion. But you did have kind of 46 deliveries in -- sorry, 38 versus kind of a 46 assumption. Curious what you're expecting in '25, and if that $5 billion CapEx is still a good level? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JANUARY 10, 2025 / 3:00PM, DAL.N - Q4 2024 Delta Air Lines Inc Earnings Call

Question: Savanthi Syth - Raymond James - Analyst : Got it. And Dan, maybe if I can follow up with -- on the non-OpEx side, any color that you can provide on how we should think about it for this year in terms of kind of interest side, but also kind of the non-interest side.

Question: Sheila Kahyaoglu - Jefferies Financial Group Inc. - Analyst : Great quarter, guys. Maybe just sticking on the fleet comments, if we could elaborate, I have 2 questions. First on just stepping up retirements here again in 2025. How do you think about the number of A350 deliveries this year and how that signals to the strong Atlantic demand that you're seeing? I'm wondering if you're seeing any changes around how you're thinking about 767 and 757 retirements?

Question: Sheila Kahyaoglu - Jefferies Financial Group Inc. - Analyst : And maybe, Dan, if I could ask a follow-up on just maintenance spend. How do we think about it for 2025 as it works towards normalized levels?