Delta Air Lines (DAL) Stock: Why Revenue Miss Has Shares Falling Despite Earnings Beat

TLDR

Table of Contents

Delta reported Q4 adjusted EPS of $1.55, beating the $1.53 estimate, but revenue of $14.61 billion missed forecasts
Shares fell 5-6% in pre-market trading despite the earnings beat due to revenue shortfall
Company forecasts 2026 EPS of $6.50 to $7.50, marking 20% growth at midpoint
All new seat capacity is being added to premium cabins with zero going to economy seating
American Express partnership generated $8.2 billion in 2025, expected to reach $10 billion soon

Delta Air Lines delivered mixed fourth quarter results Tuesday, beating earnings expectations while falling short on revenue. The stock tumbled more than 5% in pre-market trading.

Delta Air Lines, $DAL, Q4-25. Results:
📊 Adj. EPS: $1.55 🔴
💰 Revenue: $16.0B 🟢
📈 Net Income: $1.2B
🔎 Record revenue and $1.3B in profit-sharing highlight a strong finish to Delta's Centennial year. pic.twitter.com/uXrjQruCSs
— EarningsTime (@Earnings_Time) January 13, 2026

The airline posted adjusted earnings per share of $1.55, topping analyst estimates of $1.53. However, revenue came in at $14.61 billion, missing the $14.67 billion consensus forecast.

The earnings figure represented a 16% drop from the $1.85 per share reported in the year-ago quarter. Revenue grew just 1.2% year-over-year.

Delta Air Lines, Inc., DAL

Delta blamed a government shutdown for dampening revenue growth by roughly two percentage points. CEO Ed Bastian said the shutdown also reduced earnings by $0.25 per share, primarily through reduced domestic travel.

For full year 2025, the company reported adjusted EPS of $5.82 on revenue of $58.28 billion. Delta generated $4.6 billion in free cash flow and $5 billion in pre-tax profit.

Premium Cabin Focus Reshapes Fleet

Delta is going all-in on wealthy travelers. The airline announced 100% of new seat capacity will go to premium cabins, with no additions to economy.

Bastian described the strategy as targeting the top end of a K-shaped economy. “Our consumer happens to sit right at the top end of that K, and as a result of that they are investing and prioritizing spending on travel,” he explained.

The approach focuses on capturing customers who prioritize travel spending and premium experiences. International routes showed particular strength, with year-over-year growth hitting 5% in the fourth quarter.

Total adjusted revenue per available seat mile reached $20.02 for the quarter, down just 0.1% from last year. About 90% of corporate clients expect travel to increase or hold steady in 2026.

American Express Partnership Delivers Growth

The co-branded credit card business with American Express continues thriving. Card remuneration jumped 11% in 2025 to reach $8.2 billion.

Bastian projects the partnership could generate $10 billion within a couple of years. He expects “high-single-digit growth” from the relationship in 2026.

“With a growing spend rate and a growing base of travelers, what it tells you is you have an affluent consumer, who Amex is the high-end card for, choosing to use their Delta card,” Bastian said.

2026 Outlook Shows Strong Growth

Delta projects adjusted EPS between $6.50 and $7.50 for 2026, representing 20% growth at the midpoint. Free cash flow is expected between $3 billion and $4 billion.

First quarter revenue should grow 5% to 7%, with adjusted EPS of $0.50 to $0.90. Bastian said 2026 started strong with accelerating demand from consumers and corporate clients.

Analysts maintain a Strong Buy consensus rating on the stock with a price target of $81.36, implying 14.5% upside potential.