Delta delivers bullish 2025 forecast on back of premiumization push

The news: Delta Air Lines expects 2025 to be the best financial year in its history, CEO Ed Bastian told CNBC, as consumers—particularly affluent ones—continue to prioritize experiences over physical goods.

• The airline anticipates a strong start to the year: It forecast Q1 revenue growth of 7% to 9% YoY, outpacing LSEG’s 5% estimate.
• Delta expects to generate over $4 billion in free cash this year, up 18% from 2024, and annual adjusted earnings of over $7.35 per share.

Clear skies ahead: Delta has good reason to be bullish. The airline is a prime beneficiary of booming demand for international travel and recovering sales from business travelers. Its efforts to position itself at the top end of the industry are winning over affluent customers, who are happy to pay more for premium seating.

• Premium ticket sales rose 8% YoY in Q4 to $5.2 billion, compared with 2% growth for main cabin revenues.
• Over half (57%) of the airline’s total 2024 revenues came from its diversified sources, which include premium and loyalty programs.
• Corporate sales rose 10% YoY in Q4, with help from a post-election bump; the airline expects demand for business travel to stay the same or increase in 2025.

Our take: Delta knows which way the wind is blowing. While lower-income consumers are traveling less, wealthier consumers are spending freely—which is why even budget carriers like Spirit and Southwest are adding premium seats.

Delta’s efforts to cater to the high-end travel market will help it stay ahead of competitors in 2025 and capitalize on record demand for air travel.

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