Delta Air Lines Inc and United Airlines said Tuesday its first-quarter loss beat analysts’ estimates in spite of fuel prices and slowing travel demand, sending shares up in morning trading.
The world's biggest airline, Delta said revenue fell 15 percent to $6.7 billion with a net loss of $794 million or 96 cents per share due to weak demand in services. Analysts projected a $1.00 loss per share according to Reuters estimates.
Meanwhile UAL Corp, parent of United Airlines, reported revenue fell 22 percent to $3.69 billion in the first quarter, with net loss of $579 million or $4 per share compared to $4.45 per share loss forecasts.
As a result, it plans to reduce its capacity, mainly in jet operations by a range of 9 percent to 10 percent this year. The carrier is monitoring demand and has “both the willingness and ability to do more if needed,” UAL Chief Financial Officer Kathryn Mikells said.
Merged Delta Airline from Northwest Airlines also said it would cut cost, particularly in its fleet of fourteen 747-200 cargo aircraft at the end of 2009 due to the aircraft's age and inefficiency.
It will also start charging international travelers $50 to check a second bag beginning on July 1 in an effort to raise $100 million.
Shares of DAL raised $1.25 to 18.36% at $8.06 while UAUA shares up 66 cent to 11.24% at $6.53 in New York Stocks trading.