CEO Ed Bastian also said that the rebound from April’s outright plunge in domestic flying had stalled, and that Delta will halve the number of extra flights it adds in August to 500.
The Atlanta-based carrier posted an adjusted loss of $3.86 billion, or $4.43 a share, vs. income of just under $2 billion, or $2.35 a share, in the year-ago quarter. Analysts polled by FactSet had been expecting a loss of $4.22 a share.
Operating revenue rang in at $1.18 billion, down 91% from a year ago. Total revenue for the quarter was $1.47 billion, slightly ahead of analysts' forecasts. Delta had $15.7 billion in liquidity as of the end of June.
The airline said passenger revenue was down an unprecedented 94% during the quarter on 85% lower capacity. That translated into a negative 21% revenue-per-available-seat mile figure, the carrier said.
The company’s total adjusted operating expense decreased $5.5 billion, or 53%, in the June quarter from a year earlier, driven by in part by lower capacity. That translated into a much lower daily cash burn rate, Bastian said in a statement, with Delta’s average daily cash burn dropping by more than 70% since late March to $27 million in June.
The magnitude of the quarterly loss “illustrates the truly staggering impact of the Covid-19 pandemic on our business,” Bastian said. “Given the combined effects of the pandemic and associated financial impact on the global economy, we continue to believe that it will be more than two years before we see a sustainable recovery.”
A resurgence in new coronavirus cases in the U.S. and related travel restrictions have stalled a fledgling recovery in U.S. travel demand and prompted all carriers including Delta to re-evaluate their plans for reinstate flights.
Indeed, in a recent memo, Bastian predicted a “lengthy and slow” rebound for the airline from the coronavirus pandemic.
While the airline is restoring about 1,000 flights in July, it said on Tuesday that it will only reinstate half that number in August as passenger traffic continues to remain moribund.
Even with the 1,000 additional flights this month, that puts it at just 30% of its normal July schedule. Over the July 4 holiday weekend, Delta flew only one-fifth as many passengers as it did a year earlier.
Despite the setback, Delta still expects to reduce cash burn to zero by year-end and to return to “profitability, marginally,” by spring.
Shares of Delta were down 0.6% at $26.66 in trading on Tuesday.