Delta Stock Plunges: Airline Cuts Outlook Amid Economic Fears!

Delta Air Lines is facing turbulence—this time, in the stock market. The airline’s shares took a nosedive after announcing a downward revision in its profit forecast for the first quarter of 2025. Investors reacted swiftly, plummeting Delta’s stock by nearly 13% in after-hours trading.

Lower Profit Expectations

Delta had previously projected strong revenue growth of 7% to 9% for the first quarter. However, the airline has now cut that estimate nearly in half, lowering it to just 3% to 4%. Additionally, the company slashed its earnings-per-share forecast from an earlier range of 70 cents to $1 down to just 30 to 50 cents.

This revision comes as Delta cites growing “macro uncertainty,” which has led to weaker demand for domestic travel. While international and premium-class bookings remain steady, the airline says overall consumer confidence has taken a hit, affecting ticket sales.

Airline Stocks Take a Hit

Delta isn’t the only airline feeling the pressure. After its announcement, stocks of other major U.S. carriers also dropped in premarket trading. United Airlines fell by 4%, American Airlines tumbled 6%, and Southwest Airlines slipped 2.4%. The airline industry has already been grappling with inflation and economic uncertainty, and Delta’s revised outlook has only heightened investor concerns.

What’s Causing the Slowdown?

There are several factors behind Delta’s more cautious outlook. The company pointed to a broader slowdown in consumer and corporate spending, with businesses being more cautious about travel budgets. Rising concerns over a potential U.S. government shutdown and ongoing trade tensions have also contributed to the uncertainty.

Travelers, especially those flying domestically, seem to be pulling back on discretionary spending. While Delta remains optimistic about international travel demand, the softness in U.S. bookings has forced the company to adjust its expectations.

What’s Next for Delta?

Delta, along with other major airlines, will provide more details at the upcoming J.P. Morgan Industrials Conference. Analysts and investors will be watching closely to see how airlines plan to navigate these economic headwinds.

Despite the current challenges, Delta remains one of the most well-regarded airlines in the industry. However, the coming months will be crucial in determining whether this is just a short-term dip or the beginning of a more significant slowdown in the airline sector.