Delta Air Lines lowered its 2026 earnings outlook to $5.10–$5.60 per share, down from its earlier projection of $6.50–$7.50|Quentin|CC BY-NC-SA 2.0

Amid rising fuel prices that are squeezing its otherwise robust business, Delta Air Lines lowered its full-year guidance yesterday and announced disappointing third-quarter results.

The carrier cut its 2026 earnings outlook to $5.10–$5.60 per share, down from its earlier projection of $6.50–$7.50. It also trimmed its free cash flow forecast from $4 billion down to $2.5 billion.

According to Bloomberg, the company’s adjusted revenue rose 15.7% from the previous year to $17.58 billion, below analysts’ $17.76 billion forecast. Profit also fell short of forecasts, at $1.13 billion.

Fuel costs exceeded the airline’s July projections by $500 million in the third quarter, reaching $4.1 billion, the carrier said. This represents a 62% rise from the previous year, when the war in Iran had not disrupted the global oil markets.

According to FactSet, US jet fuel prices surged to $4.34 per gallon this week, from $2.19 a year earlier, partly driven by geopolitical tensions surrounding Iran and the Strait of Hormuz.

Meanwhile, CEO Ed Bastian noted that strong consumer demand across all service cabins, geographies, and travel categories helped offset an estimated $6 billion jump in annual fuel expenses.

Delta expects revenue to rise 20% year over year in the fourth quarter, partly benefiting from its jet fuel refinery in Pennsylvania. The airline, which is the most profitable in the US, is also the first American carrier to report third-quarter earnings.

How are airlines offsetting fuel prices?
Major airlines are not only raising ticket prices but also shifting their focus toward affluent customers. Several carriers are prioritizing profitable long-haul flights and cutting less-lucrative routes aimed at budget-conscious travelers.

Many airlines are expanding first-class cabins and increasing the availability of premium seats.

Even Delta saw its premium seating revenue rise 18% in Q3.

Competitors like United, Southwest, American, Alaska, and JetBlue will report later this month.