Delta CEO Doesn't Expect Airfares to Come Down Anytime Soon While Demand Remains Strong

Americans are still spending on travel, even as surging fuel prices have driven ticket prices higher, Delta Air Lines executives said Friday. Speaking on a conference call after the airline reported earnings, Delta (DAL) CEO Ed Bastian said the economy has remained “resilient,” with Delta’s customers prioritizing experiences like air travel even amid rising ticket prices. Bastian said he expects Delta’s revenue growth should “remain sustainable” despite the higher ticket prices, as airfares have grown slower than inflation in recent years, leaving room for them to stay at current levels even as fuel prices start to come down. In a CNBC interview Friday morning, Bastian said Delta customers seem to still be feeling “the post-COVID effect, where people lost so much time and they didn’t have the opportunity to do what they wanted to do in life,” and said the trend is true across different generations.

Delta’s results could serve as a positive indicator for how other airlines performed in the second quarter, while the record high fuel costs could be cause for concern for the airlines’ margins if oil prices move higher once again. Delta topped Wall Street estimates with its second-quarter results this morning, reporting adjusted earnings of $1.56 per share on $19...