Delta Air Lines and Southwest Airlines, two of the largest U.S. air carriers, reported better-than-expected quarterly profits Wednesday, helped by broadly higher ticket prices andrelatively strong demand.
Delta , fresh out of a 19-month spell under bankruptcy protection, reported a large profit helped by one-time items related to its reorganization. Southwest, the leading U.S. discount carrier, saw its net profit fall as its financial hedges provided less protection from rising fuel prices, but
the decline was less than expected.
"What we've seen with Delta is a good indication that we're on a positive track," said Calyon Securities analyst Ray Neidl, commenting on the air travel industry as a whole.
Delta, the No. 3 U.S. carrier, which emerged from Chapter 11 at the end of April, said second-quarter net profit jumped to $1.77 billion, or $4.49 per share, compared with a loss of $2.2 billion a year ago, when the company's shares were unlisted.
Excluding a $1.5 billion gain related to revaluing its assets, the company posted earnings of 70 cents per share, beating Wall Street estimates of 57 cents per share, according to Reuters Estimates.
Operating revenue rose 5.5% to $5 billion on higher fares and fuller planes, with trans-Atlantic and Latin American routes especially strong.
Southwest , the No. 6 U.S. airline by passenger traffic, said quarterly earnings fell 16.5% on higher fuel costs and signs of sluggish demand.