Delta: Disappointing Transatlantic Summer Driven By Main Cabin

Credit: Joe Pries Aviation

Expressing disappointment in this summer’s transatlantic results, Delta Air Lines has pointed to shifting peak demand and continued softness in the main cabin.

“July and August have not been the peak months that they once were in terms of high-end leisure into Europe,” said President Glen Hauenstein during a Sept. 11 Morgan Stanley event. Although still profitable, “it was our worst-performing entity in the third quarter,” he said.

Now heading into what historically has been the shoulder season, the carrier sees “a big sequential improvement” in transatlantic performance, as peaks shift from August to October, and it is optimistic about improving trends across other international entities. Digging further into its transatlantic results, weakness “was all in the main cabin,” Hauenstein noted. “Premium products across the board are continuing to perform—within every entity, premium is leading in terms of unit revenues.”

Today, well over 50% of Delta’s revenues are generated outside of the main cabin, tied to premium products and services, ancillary revenues and co-brand credit card spend. Investments in premium continue, and next year the carrier will have a record number of premium seats on offer as it ups the overall percentage, while main cabin domestic will be flat to slightly down. It plans in 2026 to expand the options and availability of its comfort plus product, a step above the main cabin experience, as appetites for upgraded offerings continue to flourish.

“Right now, you have the high-end producing returns, and you have the main cabin really essentially not producing returns that are acceptable,” Hauenstein said. Though the carrier expects a rationalization of main cabin capacity should help to improve those results, “we don't need main cabin to be positive to post positive returns,” he added. “And indeed, that's what we're seeing now—main cabin is still negative.”

Looking ahead, Delta projects 2025 to be a record remuneration year, with spending up by double digits in the quarter. It described continued robust demand for its top-end premium co-brand credit cards and plans to “re-engineer” or “inject value” in the lower-end cards, as more budget-conscious customers lag in spend and acquisitions.

“There's a lot of consternation, I think, at the bottom end, for consumers who lost income relative to inflation, lost income as student loans come on, as interest rates reset—and they've been under a lot of stress,” Hauenstein observed. “I think you've seen that manifest itself in the airline business. Companies that cater to that cohort are not doing as well as the companies that cater to a higher income bracket, and we're at the very top.”

In a Sept. 11 filing, Delta reaffirmed its earnings outlook for the third quarter and full year 2025. Citing improved demand trends and industry supply rationalization, the carrier expects total revenue growth of 2% to 4% year-over-year for the three months ending Sept. 30, the upper half of its initial guidance range. Heading into the fall, Delta sees “a lot more” pricing power and “very strong” domestic corporate demand.

“We actually had our highest post-pandemic corporate sales number for any day and any week in this September,” Hauenstein noted. “So, it’s looking like the fall is going to be quite solid in terms of the booking demand for corporate, as well as high-yield leisure—both of those segments are doing incredibly well.”