Delta Air Lines, Inc.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Item 2. MD&A
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our Condensed Consolidated Financial Statements and the related notes and other financial information included elsewhere in this Quarterly Report on Form 10-Q and our audited Consolidated Financial Statements and related notes included in our 2025 Form 10-K.
September 2026 Quarter Financial Highlights
Our operating income for the September 2026 quarter was $1.5 billion, a decrease of $230 million compared to the September 2025 quarter.
Revenue. Compared to the September 2025 quarter, our total revenue increased $3.5 billion. Passenger revenue increased $2.0 billion compared to the September 2025 quarter on broad based demand strength across premium, main, and loyalty. In addition, the increase in total revenue was driven by higher refinery sales to third parties and growth in our cargo and MRO businesses. Total revenue, adjusted (a non-GAAP financial measure, which excludes revenue related to refinery sales to third parties) increased in the September 2026 quarter by $2.4 billion, or 16%, compared to the September 2025 quarter.
Operating Expense. Total operating expense in the September 2026 quarter increased $3.7 billion, or 25%, compared to the September 2025 quarter, primarily due to higher aircraft fuel costs, expenses related to refinery sales to third parties, and salaries and related costs. Total operating expense, adjusted (a non-GAAP financial measure, which primarily excludes expenses related to refinery sales to third parties) in the September 2026 quarter increased $2.4 billion, or 18%, compared to the September 2025 quarter.
Our total operating cost per available seat mile ("CASM") increased 25% compared to the September 2025 quarter, while non-fuel unit cost ("CASM-Ex", a non-GAAP financial measure) increased 7.3%.
Non-Operating Results. Total non-operating expense was $380 million in the September 2026 quarter, compared to income of $93 million in the September 2025 quarter, primarily due to mark-to-market losses on certain of our equity investments in the September 2026 quarter compared to gains in the September 2025 quarter.
Cash Flow. During the September 2026 quarter, operating activities generated $1.7 billion, primarily from ticket sales and the sale of SkyMiles to our partners. Remuneration from American Express was $2.3 billion in the September 2026 quarter.
Cash flows used in investing activities during the quarter totaled $1.3 billion primarily from capital expenditures. These operating and investing activities yielded free cash flow (a non-GAAP financial measure) of $463 million in the September 2026 quarter. Additionally, we had cash outflows of $1.2 billion related to repayments of our debt and finance leases.
Our cash, cash equivalents, short-term investments and aggregate undrawn principal amount available under our revolving credit facilities ("liquidity") as of September 30, 2026 was $6.9 billion.
The non-GAAP financial measures referenced above for total revenue, adjusted, operating expense, adjusted, CASM-Ex and free cash flow are defined and reconciled in "Supplemental Information" below.
Delta Air Lines, Inc. | September 2026 Form 10-Q | 18 | ||||||
Item 2. MD&A - Results of Operations
Results of Operations - Three Months Ended September 30, 2026 and 2025
Total Operating Revenue
Three Months Ended September 30, | Increase (Decrease) | % Increase (Decrease) | |||||||||||||||||||
(in millions)(1) | 2026 | 2025 | |||||||||||||||||||
| Ticket - Premium products | $ | 6,818 | $ | 5,796 | $ | 1,022 | 18 | % | |||||||||||||
| Ticket - Main cabin | 6,802 | 6,063 | 739 | 12 | % | ||||||||||||||||
| Loyalty travel awards | 1,302 | 1,108 | 194 | 18 | % | ||||||||||||||||
| Travel-related services | 612 | 539 | 73 | 14 | % | ||||||||||||||||
| Total passenger revenue | $ | 15,534 | $ | 13,506 | $ | 2,028 | 15 | % | |||||||||||||
| Cargo | 301 | 233 | 68 | 29 | % | ||||||||||||||||
| Other | 4,351 | 2,934 | 1,417 | 48 | % | ||||||||||||||||
| Total operating revenue | $ | 20,186 | $ | 16,673 | $ | 3,513 | 21 | % | |||||||||||||
| TRASM (cents) | 25.46 | ¢ | 21.09 | ¢ | 4.37 | ¢ | 21 | % | |||||||||||||
Third-party refinery sales | (3.28) | (1.87) | (1.41) | 75 | % | ||||||||||||||||
TRASM, adjusted(2) | 22.18 | ¢ | 19.22 | ¢ | 2.96 | ¢ | 15 | % | |||||||||||||
(1)Total amounts in the table above may not calculate exactly due to rounding.
(2)Total revenue per available seat mile ("TRASM"), adjusted is a non-GAAP financial measure. For additional information on adjustments to TRASM, see "Supplemental Information" below.
Compared to the September 2025 quarter, total revenue increased $3.5 billion, as a result of broad based demand strength across premium, main, and loyalty. In addition, the increase in total revenue was driven by higher refinery sales to third parties and growth in our cargo and MRO businesses. Cargo revenue increased 29%, driven largely by volume.
Passenger Revenue by Geographic Region
Increase (Decrease) vs. Three Months Ended September 30, 2025 | ||||||||||||||||||||||||||
| (in millions) | Three Months Ended September 30, 2026 | Passenger Revenue | RPMs (Traffic) | ASMs (Capacity) | Passenger Mile Yield | PRASM | Load Factor | |||||||||||||||||||
| Domestic | $ | 10,594 | 16 | % | 1 | % | — | % | 15 | % | 16 | % | 1 | pt | ||||||||||||
| Atlantic | 3,317 | 11 | % | (1) | % | — | % | 12 | % | 11 | % | (1) | pt | |||||||||||||
| Latin America | 867 | 14 | % | (5) | % | (6) | % | 20 | % | 22 | % | 1 | pt | |||||||||||||
| Pacific | 756 | 13 | % | 6 | % | 8 | % | 7 | % | 5 | % | (2) | pts | |||||||||||||
| Total | $ | 15,534 | 15 | % | 1 | % | — | % | 14 | % | 15 | % | — | pts | ||||||||||||
Domestic
Domestic passenger revenue increased 16% in the September 2026 quarter compared to the September 2025 quarter on flat capacity. Domestic revenue increased on broad based demand strength across premium, main, and loyalty.
International
International passenger revenue for the September 2026 quarter increased 12% compared to the September 2025 quarter. The increase in the Atlantic region is primarily driven by demand for premium products. Revenue growth in the Latin America region reflects demand strength to the Mexican business as well as Caribbean and Mexican leisure destinations despite lower capacity in the Mexican leisure markets due to civil unrest in several of our destinations in the first half of 2026. Pacific region revenue growth reflects continued demand for premium products and new routes to Asia.
Delta Air Lines, Inc. | September 2026 Form 10-Q | 19 | ||||||
Item 2. MD&A - Results of Operations
Other Revenue
Three Months Ended September 30, | Increase (Decrease) | % Increase (Decrease) | |||||||||||||||||||
| (in millions) | 2026 | 2025 | |||||||||||||||||||
| Refinery | $ | 2,601 | $ | 1,476 | $ | 1,125 | 76 | % | |||||||||||||
| Loyalty and related | 1,346 | 1,129 | 217 | 19 | % | ||||||||||||||||
| MRO | 296 | 231 | 65 | 28 | % | ||||||||||||||||
| Miscellaneous | 108 | 98 | 10 | 10 | % | ||||||||||||||||
| Other revenue | $ | 4,351 | $ | 2,934 | $ | 1,417 | 48 | % | |||||||||||||
Refinery. Refinery sales to third parties increased $1.1 billion compared to the September 2025 quarter. See "Refinery Segment" below for additional details on the refinery's operations, including third party refinery sales.
Loyalty and Related. This primarily relates to revenue from brand usage by third parties embedded in miles sold. Loyalty and related also includes the redemption of miles for non-travel awards and revenue from our vacation package operations, lounge access (including access provided to certain American Express cardholders) and travel products (e.g., commissions from car rentals or hotels booked with our commercial partners). Most of the increase compared to the prior period is driven by higher customer spend on American Express cards and new card acquisitions as we refreshed our co-brand credit card portfolio with new and enhanced travel benefits during the June 2026 quarter.
MRO. This represents revenue from our Delta TechOps third-party maintenance, repair and overhaul ("MRO") business. The increase compared to the prior period resulted from a shift in mix to work on more legacy engines than next generation engines, which we expect to continue through the remainder of 2026.
Miscellaneous. This is primarily composed of revenues related to codeshare agreements and international commercial joint venture contractual settlements.
Delta Air Lines, Inc. | September 2026 Form 10-Q | 20 | ||||||
Item 2. MD&A - Results of Operations
Operating Expense
Three Months Ended September 30, | Increase (Decrease) | % Increase (Decrease) | |||||||||||||||||
| (in millions) | 2026 | 2025 | |||||||||||||||||
| Salaries and related costs | $ | 4,822 | $ | 4,443 | $ | 379 | 9 | % | |||||||||||
| Aircraft fuel and related taxes | 4,351 | 2,570 | 1,781 | 69 | % | ||||||||||||||
| Refinery expense | 2,601 | 1,476 | 1,125 | 76 | % | ||||||||||||||
| Contracted services | 1,277 | 1,166 | 111 | 10 | % | ||||||||||||||
| Landing fees and other rents | 1,021 | 921 | 100 | 11 | % | ||||||||||||||
| Aircraft maintenance materials and outside repairs | 662 | 667 | (5) | (1) | % | ||||||||||||||
| Passenger commissions and other selling expenses | 703 | 645 | 58 | 9 | % | ||||||||||||||
| Regional carrier expense | 680 | 649 | 31 | 5 | % | ||||||||||||||
| Depreciation and amortization | 673 | 614 | 59 | 10 | % | ||||||||||||||
| Passenger service | 494 | 485 | 9 | 2 | % | ||||||||||||||
| Profit sharing | 389 | 392 | (3) | (1) | % | ||||||||||||||
| MRO expense | 267 | 212 | 55 | 26 | % | ||||||||||||||
| Aircraft rent | 159 | 135 | 24 | 18 | % | ||||||||||||||
| Other | 633 | 614 | 19 | 3 | % | ||||||||||||||
| Total operating expense | $ | 18,732 | $ | 14,989 | $ | 3,743 | 25 | % | |||||||||||
Salaries and Related Costs. The increase in salaries and related costs primarily resulted from the implementation of 4% base pay increases for eligible employees effective on June 1, 2026 and for Delta pilots on January 1, 2026, annual pay scale step up and increases in premium pay from operational disruptions.
Aircraft Fuel and Related Taxes. Aircraft fuel and related taxes increased $1.8 billion compared to the September 2025 quarter primarily due to a 63% increase in our average jet fuel purchase price. We expect that fuel consumption for the remainder of 2026 will remain aligned with capacity changes compared to 2025, while elevated jet fuel costs are anticipated to persist until market disruptions and geopolitical events are resolved.
Refinery Expense. This includes expenses associated with refinery sales to third parties. See "Refinery Segment" below for additional details on the refinery's operations.
Contracted Services. The increase in contracted services primarily resulted from expanding our in-flight entertainment and Wi-Fi products, volume increases in our Cargo business and additional contract labor costs associated with the expansion of our Sky Club network, particularly our Delta One lounges.
Landing Fees and Other Rents. The increase in landing fees and other rents resulted from higher rates charged by airports following the completion of extensive redevelopment projects at numerous facilities.
Depreciation and Amortization. The increase in depreciation and amortization results from new aircraft deliveries and fleet modifications, partially offset by aircraft retirements.
MRO Expense. This represents expenses from our Delta TechOps third-party MRO business. The increase compared to the prior period resulted from a shift in mix to work on more legacy engines than next-generation engines, which we expect to continue through the remainder of 2026.
Aircraft Rent. Aircraft rent increased primarily related to additional engine leases to support our operation.
Delta Air Lines, Inc. | September 2026 Form 10-Q | 21 | ||||||
Item 2. MD&A - Results of Operations
Results of Operations - Nine Months Ended September 30, 2026 and 2025
Total Operating Revenue
Nine Months Ended September 30, | Increase (Decrease) | % Increase (Decrease) | |||||||||||||||||
(in millions)(1) | 2026 | 2025 | |||||||||||||||||
| Ticket - Premium products | $ | 19,100 | $ | 16,402 | $ | 2,698 | 16 | % | |||||||||||
| Ticket - Main cabin | 19,058 | 17,771 | 1,287 | 7 | % | ||||||||||||||
| Loyalty travel awards | 3,578 | 3,140 | 438 | 14 | % | ||||||||||||||
| Travel-related services | 1,707 | 1,539 | 168 | 11 | % | ||||||||||||||
| Total passenger revenue | $ | 43,443 | $ | 38,852 | $ | 4,591 | 12 | % | |||||||||||
| Cargo | 821 | 654 | 167 | 26 | % | ||||||||||||||
| Other | 11,533 | 7,855 | 3,678 | 47 | % | ||||||||||||||
| Total operating revenue | $ | 55,797 | $ | 47,361 | $ | 8,436 | 18 | % | |||||||||||
| TRASM (cents) | 24.56 | ¢ | 21.04 | ¢ | 3.52 | ¢ | 17 | % | |||||||||||
Third-party refinery sales | (2.79) | (1.63) | (1.16) | 71 | % | ||||||||||||||
TRASM, adjusted(2) | 21.77 | ¢ | 19.41 | ¢ | 2.36 | ¢ | 12 | % | |||||||||||
(1)Total amounts in the table above may not calculate exactly due to rounding.
(2)TRASM, adjusted is a non-GAAP financial measure. For additional information on adjustments to TRASM, see "Supplemental Information" below.
Unless otherwise discussed below, the changes in total revenue line items, as well as the underlying reasons for these changes, compared to the nine months ended September 30, 2025, are consistent with the discussion above under Results of Operations - Three Months Ended September 30, 2026 and 2025.
Compared to the nine months ended September 30, 2025, total revenue increased $8.4 billion, or 18%, on a 1% increase in capacity.
Passenger Revenue by Geographic Region
Increase (Decrease) vs. Nine Months Ended September 30, 2025 | ||||||||||||||||||||||||||
| (in millions) | Nine Months Ended September 30, 2026 | Passenger Revenue | RPMs (Traffic) | ASMs (Capacity) | Passenger Mile Yield | PRASM | Load Factor | |||||||||||||||||||
| Domestic | $ | 29,985 | 13 | % | 2 | % | 1 | % | 11 | % | 12 | % | — | pts | ||||||||||||
| Atlantic | 7,947 | 10 | % | — | % | 1 | % | 10 | % | 9 | % | (1) | pt | |||||||||||||
| Latin America | 3,184 | 5 | % | (6) | % | (5) | % | 11 | % | 10 | % | — | pts | |||||||||||||
| Pacific | 2,327 | 13 | % | 6 | % | 6 | % | 6 | % | 6 | % | — | pts | |||||||||||||
| Total | $ | 43,443 | 12 | % | 1 | % | 1 | % | 11 | % | 11 | % | — | pts | ||||||||||||
Domestic passenger revenue for the nine months ended September 30, 2026 increased 13% on 1% higher capacity compared to the nine months ended September 30, 2025. International passenger revenue for the nine months ended September 30, 2026 increased 9% on 1% higher capacity compared to the nine months ended September 30, 2025.
Other Revenue
Nine Months Ended September 30, | Increase (Decrease) | % Increase (Decrease) | |||||||||||||||||
| (in millions) | 2026 | 2025 | |||||||||||||||||
| Refinery | $ | 6,346 | $ | 3,680 | $ | 2,666 | 72 | % | |||||||||||
| Loyalty and related | 3,911 | 3,338 | 573 | 17 | % | ||||||||||||||
| MRO | 990 | 621 | 369 | 59 | % | ||||||||||||||
| Miscellaneous | 286 | 216 | 70 | 32 | % | ||||||||||||||
| Other revenue | $ | 11,533 | $ | 7,855 | $ | 3,678 | 47 | % | |||||||||||
Delta Air Lines, Inc. | September 2026 Form 10-Q | 22 | ||||||
Item 2. MD&A - Results of Operations
Operating Expense
Nine Months Ended September 30, | Increase (Decrease) | % Increase (Decrease) | ||||||||||||||
| (in millions) | 2026 | 2025 | ||||||||||||||
| Salaries and related costs | $ | |||||||||||||||
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-08-05 | Sear Steven M | EVP - Global Sales & Distrib | Sell | -40,460 | $93.55 | -$3,785,154 |
| 2026-08-05 | HUERTA MICHAEL P | Director | Sell | -3,100 | $94.11 | -$291,756 |
| 2026-08-04 | Bastian Edward H | Chief Executive Officer | Sell | -206,510 | $92.80 | -$19,163,302 |
| 2026-08-04 | BELLEMARE ALAIN | EVP & Pres. - International | Sell | -35,000 | $92.72 | -$3,245,165 |
| 2026-08-04 | Carter Peter W | President | Sell | -39,900 | $92.98 | -$3,709,942 |
| 2026-08-03 | DEWALT DAVID G | Director | Sell | -31,756 | $90.85 | -$2,884,969 |
Source: SEC Form 4 filings.
Next expected filings
- ~2027-02-11 10-K expected by 2027-03-01 (in 110 days)
- ~2027-04-07 10-Q expected by 2027-05-07 (in 165 days)
- ~2027-07-09 10-Q expected by 2027-08-08 (in 258 days)
- ~2027-10-08 10-Q expected by 2027-11-07 (in 349 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-10-09 8-K Earnings Release; Financial Statements and Exhibits
- 2026-10-09 10-Q Quarterly Report
- 2026-07-10 8-K Earnings Release; Financial Statements and Exhibits
- 2026-07-10 10-Q Quarterly Report
- 2026-07-10 S-3ASR S-3ASR
- 2026-06-12 8-K Material Agreement Entered; Material Financial Obligation
- 2026-04-24 DEF 14A Proxy Statement
- 2026-04-08 10-Q Quarterly Report
- 2026-04-08 8-K Earnings Release; Financial Statements and Exhibits
- 2026-03-05 8-K Officer/Director Change; Financial Statements and Exhibits
- 2026-02-13 8-K Officer/Director Change
- 2026-02-11 10-K Annual Report
- 2026-01-27 8-K Material Agreement Entered
- 2026-01-13 8-K Material Agreement Entered; Earnings Release; Financial Statements and Exhibits
- 2025-12-17 8-K Officer/Director Change; Financial Statements and Exhibits