Shares of United, American Airlines, Delta Air Lines and Southwest Airlines are rising following Delta’s strong earnings report from Investing.com

Investing.com – Shares of major U.S. airlines rose sharply in today’s trading session after Delta Air Lines Inc. (NYSE: NYSE:) reported strong financial performance for the final quarter of 2024 that exceeded Wall Street expectations. The positive results and optimistic outlook for the new year have shone a favorable light on the entire industry and positively influenced the share prices of Delta’s competitors.

United (NASDAQ: UAL) led the way, rising 7%, while American Airlines Group Inc. (NASDAQ: AAL) rose 4.5%. Shares of Delta jumped 7% and Southwest Airlines Co. (NYSE: LUV) rose 3%. Delta’s share price jump, which if continued could mark its biggest single-day gain since October 2022, was driven by robust earnings and expectations of continued positive momentum into 2025.

Delta’s first-quarter adjusted earnings are forecast between $0.70 and $1 per share, significantly beating analysts’ expectations. The airline also predicts year-over-year revenue growth of up to 9%, beating analysts’ forecasts of 5.75%. CEO Ed Bastian expressed confidence about the current supply-demand ratio and the ability to plan the business until spring 2025.

The aviation industry in Russia is currently driving higher airfares, driven by controlled expansion in the domestic market and strong demand for international flights – even during the traditionally weaker winter season. Analysts predict that these factors, along with new premium offerings from low-cost airlines, could lead to the U.S. airline industry’s first profitable first quarter since 2019.

Delta’s fourth-quarter adjusted profit was $1.85 per share, beating analysts’ estimates of $1.76. Sales reached $14.44 billion, also above Wall Street expectations of $14.16 billion. The company attributed the robust performance to a 10% increase in business travel sales, particularly driven by the technology and financial services sectors.

International travel revenue rose 6% year-over-year, with premium revenue outpacing economy. Additionally, Delta’s partnership with American Express Co. saw a 14% increase in loyalty point payments, approaching $2 billion. As a sign of the good business situation, the airline plans to reward its employees with a profit share of $1.4 billion next month.

Delta’s positive results and forward-looking statements have also boosted the stock prices of its aviation peers and signal a promising start to 2025 for U.S. airlines.

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