By Pras Subramanian

Delta Air Lines (DAL) will report second quarter results on Friday morning, with investors hoping growth in the premium business will continue to blunt issues like rising fuel costs and capacity cuts stemming from those expenses.

For the quarter, Delta is expected to report Q2 adjusted revenue of $17.53 billion, per Bloomberg results, up 13% year over year. Delta will likely report adjusted earnings per share (EPS) of $1.51, with adjusted net income of $985.2 million.

Delta had previously projected Q2 revenue to grow in the "low teens," with operating margin in the 6% to 8% range and adjusted EPS of $1 to $1.50.

Delta also projects pretax profit of "around $1 billion," despite a more than $2 billion increase in fuel expenses in Q2. Fuel expenses in the first quarter came in at $2.591 billion, up 8% compared to a year ago, though that includes a refinery benefit of approximately $300 million.

When it reported Q1 results, Delta did not provide full-year 2026 projections. At the end of the fourth quarter, Delta saw full-year adjusted EPS of $6.50 to $7.50, representing a 20% year-over-year jump at the midpoint, with free cash flow in the range of $3 billion to $4 billion. 

"We're not walking it back," Delta CEO Ed Bastian said on a press roundtable with reporters on guidance last quarter, just that there would be no updates to the projections.

"The question of not just the day, of the month, is going to be how we navigate this higher fuel environment brought on by the Iranian conflict?" he said.  

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Last quarter, Delta said it was taking actions to protect margins and cash flow. The airline has reduced capacity growth and cut flights in low-traffic markets and midweek flights, and was moving quickly to "recapture higher fuel costs."

Investors are hoping Delta's growth is once again driven by increased business from its premium-focused, higher-net-income clients.

Delta said Premium revenue grew 14% compared to a year ago in Q1, with loyalty and related revenue climbing 13% as well. American Express remuneration came in at over $2 billion, up 10% over the prior year.

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Continuing the trend of maximizing its premium business, this week Delta announced a Basic Business class to its fare structure, offering a cheaper ticket in Delta One and business class that omits benefits like lounge access, fully refundable fares, seat selection, and reduced checked bags. 

Pras Subramanian is Lead Transportation Reporter for Yahoo Finance. You can follow him on X and on Instagram.

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