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Delta Sees Flying Back Into the Black in 2022, Despite Omicron

Delta Air Lines expects to be profitable in 2022, betting on strong holiday demand even as surging cases of Omicron spur new travel restrictions globally.

Delta Air Lines  (DAL) - Get Delta Air Lines, Inc. Report said Thursday that it expects to be profitable in 2022, betting on strong holiday demand even as surging cases due to Omicron have reimposed travel restrictions globally, causing travellers to pivot or cancel plans.

Delta said it expects to generate an adjusted pre-tax profit of $200 million in the December quarter, even as fourth-quarter revenue comes in 26% below 2019 levels of $11.44 billion, the carrier said in a securities filing ahead of its first in-person investor day since the pandemic began.

Shares of Delta were up about 2% in premarket trading, ahead of other carriers. Since touching $62.03 on January 20, 2020, however, the stock is down more than 40%.

Delta in October said it expected to post a pre-tax fourth-quarter loss due to rising fuel costs. It now expects fuel costs per gallon of between $2.20 and $2.30, down from earlier forecasts of between $2.25 and $2.40.

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However, the carrier last month reported a 450% surge in international bookings in the six weeks since Sept. 20 when the U.S. said it would reopen for fully vaccinated visitors.

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At the same time, numerous countries including the U.K., France and Canada are reimposing bans on non-essential travel this week in response to the Omicron coronavirus variant, with travelers being told to postpone or cancel their plans.

Canada issued a travel advisory to its citizens Wednesday asking that they avoid all nonessential international travel as the Omicron variant spreads throughout the world.

"We see the situation abroad, and we're afraid and concerned with what could happen to Canadians who would choose to go abroad in the next few weeks," said Jean-Yves Duclos, Canada's health minister, during a news briefing Wednesday.