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Delta Shares Gain On Narrower Loss, Second Half Profit Forecast: American Soars

“While our challenges continue in 2021, I am optimistic this will be a year of recovery and a turning point that results in an even stronger Delta returning to revenue growth, profitability and free cash generation," said CEO Ed Bastian.

Delta Air Lines Inc  (DAL) - Get Report posted a narrower-than-expected second quarter loss Wednesday and said a pick up in business and leisure travel demand would lift the group into profitability over the second half of the year.

Delta said its adjusted loss for the three months ending in June was pegged at $1.07 per share, down from a loss of $4.43 per share over the same period last year and well inside the Street consensus forecast of -$1.40. Group revenues, Delta said, surged nearly four-fold to $7.13 billion, firmly ahead of analysts' estimates of a $6.2 billion tally.

“Our December quarter results capped the toughest year in Delta’s history. I want to thank the Delta people who have risen to the occasion, focusing on delivering results for all of our stakeholders by putting our customers at the center of our recovery,” said CEO Ed Bastian. “While our challenges continue in 2021, I am optimistic this will be a year of recovery and a turning point that results in an even stronger Delta returning to revenue growth, profitability and free cash generation.”  

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Delta shares were marked 0.3% higher in early trading immediately following the earnings release to change hands at $41.47 each.

American Airlines  (AAL) - Get Report shares were also active Wednesday, rising 5.5% to $21.12 each after the country's biggest carrier said it flew 44 million passengers over the three months ending in June and indicated a narrower-than-expected loss when it publishes second quarter earnings next week.

Delta said earlier this week that it will add 36 aircraft to its existing fleet, with leases from Airbus  (EADSY) - Get Report and used planes from Boeing  (BA) - Get Report in what Bastian called "an investment in Delta's future."

Last month, rival United Airlines  (UAL) - Get Report confirmed plans to buy a total of 270 new planes from both Boeing and Airbus for around $30 billion in the largest single aircraft deal in the carrier's history.

United will buy 50 Boeing 737 Max 8 jets and a further 150 Max 10s, with the first of the Max 8s expected to begin carrying passengers later this summer. United will also buy 70 Airbus A321 Neos, the planemaker's narrowbody rival to the Max, as part of the $30 billion list price order. United also said it will add 25,000 new jobs as a result of the fleet expansion.