Northwest Airlines Joins Delta in Issuing Profit Warning

Northwest Airlines (NWAC Quote) said Wednesday its first-quarter earnings will fall short of Wall Street's expectations due to the weakening economy and a decline in corporate business travel.

For its first quarter ending March 31, Northwest expects to report a loss of $130 million to $150 million, or $1.55 to $1.80 a share, excluding one-time items, sharply higher than the 59 cent a share loss consensus estimate of 11 analysts surveyed by First Call/Thomson Financial. In the year-ago period, the Egan, Minn.-based air carrier lost 51 cents a share.

"In the near term, we remain cautious as we expect to see continued softness in our mix of business travelers, which would have an adverse impact on yields and revenue," the company said in a filing with the Securities and Exchange Commission.

Earlier this month, Northwest faced a looming strike by mechanics as contract talks stalled, but President Bush intervened with an executive order preventing a strike for 60 days.

On Tuesday, Delta Air Lines(DAL Quote) warned its earnings would fall short of Wall Street forecasts in the first quarter, citing a reduced flight schedule, the weaker economy and customers wary of a possible pilot strike.

Shares of Northwest dropped $1.38, or 6.7%, to $19.31 in recent New York Stock Exchange trading, while Delta's shares fell $1.16, or 2.8%, to $40.30.