The paragraph introduces the Delta Air Lines March Quarter 2024 Financial Results Conference Call and identifies the participants. It also mentions that the call is being recorded and provides instructions for the question-and-answer session. The CEO, President, and CFO will be discussing Delta's performance and strategy, revenue, costs, and balance sheet. The call will also address forward-looking statements and non-GAAP financial measures. The CEO thanks everyone for joining and turns the call over to the Vice President of Investor Relations.

Delta reported strong financial results for the first quarter, with pre-tax earnings of $380 million and a record revenue. They also achieved industry-leading operational reliability and have invested in their operation to continue this trend. The company recognized their employees with $1.4 billion in profit-sharing and has been recognized as a top employer and airline by Forbes and Air Transport World. Delta's focus on providing exceptional customer experiences has also earned them a spot on Fortune's list of the World's Most Admired Companies.

Delta is making exciting changes for customers, such as new lounges, modern aircraft, and improved services. They have been successful with their Wi-Fi and loyalty program, and have been recognized as an innovative company. They have a strong financial outlook for the year and expect to have record revenue and profits in the upcoming quarter. However, there may be a slight decrease in profit compared to last year due to higher fuel prices.

The article discusses the strong demand for Delta Airlines, with a record spring and summer travel season and a focus on improving financial returns. The company's performance is attributed to its differentiated brand and disciplined approach to capital investment. The CEO is optimistic about future opportunities and will provide new long-term financial targets at an upcoming Investor Day. The company's success is credited to its employees' dedication to providing excellent service and reliability to customers.

Delta is off to a strong start in 2024, with record revenue of $12.6 billion and a 6% increase from the previous year. Business travel has seen a sustained acceleration, with a 14% increase in managed corporate travel sales. The company has also seen positive unit revenue growth in its domestic and transatlantic entities. Diverse high-margin revenue streams, including premium and loyalty revenue, have contributed to Delta's strong financial performance.

The company has seen record card applications and strong demand for premium travel. They expect revenue growth in the second quarter, with a focus on restoring core hubs and increasing asset utilization. The transatlantic market is expected to perform well, while Latin America is facing pressure in leisure markets but is expected to improve in the second half of the year. The company is also increasing capacity in deep South America through their JV partnership with LATAM.

In the first quarter of 2024, Delta expects Pacific unit revenues to be similar to the previous year due to strong demand in Korea and Japan offsetting lower revenues in China. The company is also expected to achieve record profitability thanks to their multi-year restructuring efforts. The operational performance and strong demand resulted in a pre-tax income of $380 million, $163 million higher than the previous year. Non-fuel unit costs were 1.5% higher than last year, but still better than expected. Fuel prices were $0.16 higher than expected, but the refinery provided a $0.05 benefit. The company also saw improved margins and free cash flow of $1.4 billion.

In the second quarter, the company invested $1.1 billion into the business and paid $1.4 billion in profit-sharing to employees. Debt reduction is a top priority and $700 million of debt was repaid. The company expects to repay at least $4 billion of debt this year and is currently investment-grade rated. For the June quarter, the company expects an operating margin of 14% to 15% and earnings of $2.20 to $2.50 per share. Fuel prices are expected to be $2.70 to $2.90 per gallon. Non-fuel unit costs are expected to be 2% higher than last year. The company is focused on restoring profitable core hubs and improving efficiency. Operational performance is leading the industry due to investments in fleet health and reliability. Hiring and training have slowed down and the company is on track to meet its efficiency goals for the year. These efforts will support the company's revenue premium.

The speaker expresses confidence in the company's full-year outlook and credits their success to the hard work of their employees. They also mention an improvement in cost execution, specifically in maintenance expenses, which are on track and expected to be up $350 million for the year. The team's proactive approach has resulted in a decrease in cancellations and the CEO congratulates the Tech Ops team for their leadership in this area.

The team is experiencing renewed confidence after a tough few years of rebuilding. While it's too early to declare victory, there is optimism for the future. The supply chain is still constrained, but they are on a good path. During the Q&A, they discussed the recovery in corporate travel and mentioned that they are seeing both shorter and longer trips, as well as people blending leisure and business travel. They also mentioned that the lack of change fees has led to changes in the booking curve. In regards to travel credits, they expect a headwind of up to a couple of points for June TRASM.

The speaker is asking for an update on the status of the appeal process with the Department of Transportation (DOT) regarding Aeromexico. The company believes the DOT's tentative order was an example of regulatory overreach and they are currently discussing alternative solutions with the administration. They are optimistic that a better solution will be reached, but it may take several months. The speaker also mentions that the company's original guidance for the year was flat RASM, but currently they are seeing a slight downturn in RASM for the first and second quarter. They are hopeful for an inflection point in the second half of the year, but the travel credit headwinds will continue to be a challenge throughout the year.

Delta is ahead of its internal plan to reach flat performance for the year and expects the industry capacity to peak in the second quarter. The company also expects a shift in seasonality, with the second quarter becoming stronger and the third quarter weaker due to schools starting earlier in the South. With improving leverage, Delta may consider using cash for other purposes such as capital expenditures and cash return in the next 12 months.

The speaker is responding to a question about the company's debt and potential impact of the Paris Olympics on transatlantic travel. They mention that they are not yet able to make any decisions or comments about the debt, but they have made progress in reducing it. They also mention that the Olympics may bring some challenges for the company's revenue, but they are excited to be a sponsor.

The speaker has two questions for the company. The first is about the higher landing fees in the first quarter, which the company explains is due to increased volume and expenses related to redevelopment projects. The second question is about American Express' acceptance rates, which the company says have improved domestically and internationally. The next question from another caller is about the company's capacity and how it will change in the second half of the year, with current schedules still above the original guidance of 3% to 5%.

Jamie Baker asks about Delta's growth for the rest of the year, and Glen Hauenstein believes they will be at the high end of their projected 3-5% growth due to exceptional completion factors. He also mentions headwinds in ancillary revenue due to industry constraints on materials and turnaround times. Jamie also asks about Delta's pre-COVID RASM premiums, and Glen discusses their domestic and international premiums.

Glen Hauenstein, Delta's President, discusses the company's international RASM premiums and their plans to continue accelerating their performance in this area. He also mentions that premium revenue was up 10% and main cabin revenue was up 4% in the first quarter, driven by a record domestic load factor and taking more traffic than historical levels. He attributes this to the strength of Delta's brand and expects to see less discounted seats available as the year progresses.

Brandon Oglenski from Barclays asks a question about domestic growth this summer and concerns about lower RASMs. Glen Hauenstein explains that they had to allocate resources to take leading positions in Boston and Los Angeles, but now they are focused on rebuilding their core hubs for higher profitability. Seat growth will be about a point below some competitors. Glen also mentions their successful performance in South America with minimal degradation of unit revenue and their joint venture with LATAM.

The speaker discusses the performance of US domestic markets in the first quarter, noting that there was an oversupply in leisure destinations. This led to historically high returns, but at the expense of unit revenues. The speaker expects a moderation of capacity and easier comps in the next year. They also mention that coastal gateways are performing well, but core hubs are seeing higher unit revenues. They had more capacity in Boston than planned due to opportunities.

The speaker discusses their satisfaction with their current position and the potential for regulatory oversight to impact growth in the medium-to-long term. They also mention their partnership with the FAA and efforts to address staffing and infrastructure challenges. When asked about the split between volume and yield in their premium revenue, the speaker states it is currently a 50-50 split and mentions plans to continue growing their premium offering.

Glen Hauenstein discusses the growth of premium products and services in the domestic market over the past 10 years and the potential for further growth in the coming years. He also mentions the need for increased regional utilization and the potential for improving utilization on the narrow body fleet.

The speaker discusses how their company has seen an increase in asset utilization and is working to improve it further. They also mention the challenges of yield management and how they have been focusing on premium products and experiences. They plan to continue this strategy and have new tools to improve retailing that they will discuss at their upcoming Investor Day in November.

Glen Hauenstein discusses how the airline industry has become commoditized due to difficulties in distributing products and services. Delta is working to improve their internal displays and online booking tools to make progress in this area. In regards to Latin America, the company is still investing in the region but expects to see more profitability in the future as they continue to work with their partner, LATAM, to merge their networks.

The speaker asks a question about cost and TRASM performance in Q1. The speaker asks about the Q2 guide and the assumption of a 2% cost growth. The speaker asks about the moving pieces and variables that contribute to this cost growth, including headcount, maintenance costs, and supply chain management. The speaker also mentions that the company is carrying higher headcount than historical levels and will grow into it, and that maintenance costs are as expected. The speaker then thanks the presenters for answering his question.

Dan Janki and Ed Bastian discuss the value of Delta TechOps in light of the aging industry fleets. They highlight the advantage of having a younger fleet and the ability to flex and be more nimble due to the constraints on OEMs. They also mention the team's ability to naturally retire and recoup equipment, as well as the strong first quarter performance of the maintenance team.

During the analyst portion of United Airlines' call, the company's leadership discussed positive developments in their operations. They mentioned that the recent winter weather has been less severe, which may have benefited their operations. They also noted that their maintenance, repair, and overhaul business will pick up in the next few years and that they are on the right path for growth. The analysts were impressed with the company's progress and asked questions about their future plans. The call then transitioned to media questions.

Delta CEO Ed Bastian and CFO Peter Carter address the issue of weather and its impact on the airline's operational performance. They state that while good weather has certainly helped, the airline's core performance has also improved. They also mention that safety is always a top priority at Delta, and they do not send out special messages about it. On the topic of Slot Waivers, Carter mentions that the extension will include the DC area and that the ATC controller shortage is still a challenge. However, the waivers have helped improve the situation.

The speaker believes that without a waiver, the aviation industry would face difficulties in New York. The moderator thanks the speaker and ends the Q&A session. The call concludes.

This summary was generated with AI and may contain some inaccuracies.