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Delta surges in Q3 with robust corporate sales

A passenger in a Delta One business class suite, a product offered on international and transcontinental long-haul flights.

Delta's revenue from corporate customers increased 12% year over year in the third quarter, helping to push the carrier's total passenger revenue up 8.2%, to $10.8 billion.

During the quarter, the carrier was able to push up corporate fares. It also saw "close-in booking strength," Delta president Glen Hauenstein said on an earnings call. 

Additionally, the carrier noted an increase of just under 20% in revenue from its premium products. Hauenstein said Delta international president and exective vice president of global sales Steve Sear and his team "have done an amazing job of getting premium [product] into corporate sales agreements" and that "upsell revenues continue to be a source of strength."

The carrier reported a strong outlook in corporate demand, as 90% of its corporate customers indicated in a recent survey that they expected to maintain or increase spending levels into next year.

Passenger load factor for the quarter was flat at 86.9%, as traffic increased 3.8% and capacity increased 3.9%. Yield rose 4.2%, an indicator of higher fares.

Domestic revenue jumped 9.2%. Transatlantic revenue rose 10.7%, and transpacific revenue increased 3%. Latin America routes were the only ones for which revenue decreased in the quarter, down 2.6%.

Delta reported a net income of $1.31 billion for the quarter, compared with $1.16 billion in the third quarter of 2017. Fuel costs rose $655 million, but Delta offset 85% of that with revenue growth and stable costs outside of fuel, CEO Ed Bastian said.

Source: Business Travel News

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