Delta Airlines Q3 Passenger Revenues down -83% = wow !

 The number of passengers is way down, and ticket prices have plunged.
Passengers entering the security zones of US airports is still down 65% from the same time last year, according to TSA airport screenings, witghout the usual surge after Labor Day, as business travel picks up and people that don’t have kids in school go on vacation.

The chart shows TSA checkpoint screenings per day, as a seven-day moving average through October 13, in 2019 (black line) and in 2020 (red line):




Retail prices of airline ticket in September plunged by 25% from January, before flight restrictions to China and other countries began, according to the Consumer Price Index for September. Even after the 9-11 attack, the deepest three-month decline was -5.9%.

Very profitable business travel is way down from the travel bans and the corporate reluctance of sending their people anywhere unless they absolutely have to.

Delta reports Q3 passenger revenues down -83%, losing $5.4 billion in the third quarter, on a 76% drop in total revenue, compared to Q3 last year. Freight revenue dropped only 25%, and other revenue increased 21%, while passenger revenue collapsed by 83%!



Delta had focused on premium business travel. Ticket revenues collapsed the most on the lucrative international routes. Year-over-year change in ticket revenues by segment:

    Domestic flights: -79%
    Across the Atlantic: -94%
    Across the Pacific: -91%
    Latin America: -86%.

Delta still has $21.5 billion in cash and cash equivalents to burn through. Its “daily cash burn” was $18 million a day at the end of September. That’s over $1 billion "burned" every two months. In the Q2 report, CEO Ed Bastian said Delta would stop burning cash by year end. Today, he moved that target into the spring of 2021.

Several of the airlines Delta had significant equity stakes in and partnered with, including Virgin Atlantic, Latam Airlines, and Grupo Aeroméxico, have filed for bankruptcy as their governments refused to make taxpayers bail out shareholders.  Delta has now written off its stakes in Latam and Aeroméxico, a sign that Delta expects its equity stakes to get wiped out in bankruptcy. Delta has written down its stake in Virgin Atlantic.