DAL US S&P 500Russell 1000 Earnings call
Delta Air Lines (DAL) · Q3 2026 results and valuation
Share price: $91.32 · 2026-11-11
Delta Air Lines is a global airline based in the United States that operates a network of flights to destinations across six continents. The company provides air transportation and cargo services to customers through its own fleet and various international airline partnerships. Source: 10-K annual report (2026-02-11)
Results Q3 2026 vs Q2 2026 · previous quarter · published 9 Oct 2026 and 10 Jul 2026
Net income down 52.9% on the previous quarter. Management sounded cautious, in its script and in answers to analysts.
1 · Numbers
−52.9%
Net income vs Q2 2026
Outlook given
Net income 756.0M vs 1.60B
Revenue +2.2%
Against the same quarter last year (Q3 2025) it is −46.6%, so it is not just seasonal.
Why Against the same quarter last year (−46.6%), net income fell because the company absorbed $1.6 billion of higher fuel costs during the September quarter.
2 · How management spoke
Cautious
Among the least upbeat of all company calls
Answers to analysts: upbeat, in line with the script.
Last call it was different: the answers were less upbeat than the script.
3 · What stood out
The Delta American Express partnership is expected to deliver more than $9 billion in remuneration this year on the way to 10 billion.
Valuation
Is Delta Air Lines undervalued?
Reverse DCF. Free cash flow from the last full fiscal year (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At 7.8% growth a year (3-year revenue growth), the model's fair value is $103.72 a share — the stock trades 12% below it. Today's price assumes 6.3% growth a year.
Current price
$91.32
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+6.3% for 10 yrs
Fair value / share
$103.72
Buy below
$77.79
Price vs fair value
Undervalued 12%
Price vs buy-below price
Overvalued 17%
Management expects
Revenue +20% · from the Q3 2026 report: “Delta Air Lines expects December quarter revenue to grow approximately 20% year-over-year on 3% capacity growth to support sequential improvement in unit…”
A guidance figure for revenue, usually one year ahead, not a 10-year free-cash-flow rate.
Read between the lines
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Key theme
The company expects to generate $2.5 billion of free cash flow to fund more than $2 billion of debt reduction, bringing three-year cumulative free cash generation to over $10 billion.
Source quote
“We also expect to generate $2.5 billion of free cash flow funding more than $2 billion of debt reduction and bringing our 3 year cumulative free cash generation to over $10 billion.”
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Guidance
Delta Air Lines expects December quarter revenue to grow approximately 20% year-over-year on 3% capacity growth to support sequential improvement in unit revenue growth while covering higher costs.
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Guidance
Delta Air Lines expects full-year pretax profits of roughly $4.5 billion, which is expected to be fairly close to last year's profitability.
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Guidance
The Delta American Express partnership is expected to deliver more than $9 billion in remuneration this year on the way to 10 billion.
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Figure
Maintenance, repair, and overhaul revenue reached $1 billion year-to-date, an increase of nearly 60% over last year.
Source quote
“I am proud of the tech ops team for delivering $1 billion of maintenance, repair, and overhaul revenue year-to-date, an increase of nearly 60% over last year.”
4 more
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Figure
The company ended the quarter with adjusted net debt of $13 billion and plans to pay down more than $2 billion of debt this year.
Source quote
“We ended the quarter with adjusted net debt of $13 billion and plan to pay down more than $2 billion of debt this year.”
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Guidance
The outlook includes a refinery benefit of more than $700 million, which highlights the company's unique value.
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Figure
The company generated $1.9 billion of free cash and a 11% return on invested capital year to date.
Source quote
“Year to date, we have generated $1.9 billion of free cash and our return on invested capital is 11%.”
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Figure
The top 40% of US households, comprising the majority of Delta's customer base, are nearly $40 trillion wealthier than they were just a few years ago.
Source quote
“The top 40% of US households which make up the majority of Delta's customer base, are nearly $40 trillion wealthier than they were just a few years ago.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q3 2026. Ring: Q2 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“But the biggest thing is trying to get to the other end of this volatility that we have seen in fuel and see where that normalizes.”
“Certainly below the rate of inflation going back either pre or post COVID that you have seen in the consumer economy more broadly.”
“Continue to strengthen the resilience of our operation with good progress on weather recovery despite challenging operating environment of this summer.”
Full figures
USD · SEC EDGAR XBRL (10-Q, period end 2026-09-30)
| Metric | Q3 2026period end 2026-09-30 | Q2 2026period end 2026-06-30 | Change | Q3 2025 | YoY |
|---|---|---|---|---|---|
| Revenue | 20.19B | 19.76B | +2.2% | 16.67B | +21.1% |
| Operating income | 1.45B | 1.86B | −22.0% | 1.68B | −13.7% |
| Net income | 756.0M | 1.60B | −52.9% | 1.42B | −46.6% |
| EPS | 1.15 | 2.44 | −52.9% | 2.17 | −47.0% |
| P/E today 17.4 | 16.7 | 15.5 | +1.2 | 8.0 | +8.7 |
Topics
Most discussed now
- You can find a reconciliation of Delta Air Lines' non GAAP measures on the Investor Relations page at ir.delta.com.
- Delta Air Lines' earnings are continuing to translate into strong cash generation, and attractive returns for its shareholders.
- Operationally, Delta delivered another quarter of industry leading performance across key metrics, including on-time, customer satisfaction.
- Continue to strengthen the resilience of Delta Air Lines' operation with good progress on weather recovery despite challenging operating…
- Delta Air Lines' diversified high margin revenue streams remain a defining strength of Delta.
Faded since Q2 2026
- Fading Both reflect Delta Air Lines' long standing commitment to sharing success with the people who drive it.
- Fading Fuel price came in better than guidance as lower crack spreads more than offset the reduced refinery benefit.
- Fading It was an obvious response to the fairly dramatic fuel spike that Delta Air Lines saw.
- Fading I would anticipate that in the fourth quarter for Delta, you will see us kind of return to a little...
Latest announcements
Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.
- Material agreement; Other events · SEC 8-K
- Results of operations · SEC 8-K
Delta Air Lines, Inc. issued a press release reporting financial results for the quarter ended September 30, 2026, as disclosed in Exhibit 99.1.
- Results of operations · SEC 8-K
Delta Air Lines, Inc. issued a press release reporting financial results for the quarter ended June 30, 2026, as disclosed in Exhibit 99.1.
- Shareholder vote results · SEC 8-K · routine
- Material agreement; New financial obligation · SEC 8-K
Delta Air Lines entered into a credit agreement on June 11, 2026, featuring a $2.650 billion revolving facility with an accordion feature to increase commitments up to $3.65 billion.
- Results of operations · SEC 8-K
Delta Air Lines reported record March quarter operating revenue of $14.2 billion, which was 9.4 percent higher than the same period last year.
- Regulation FD disclosure · SEC 8-K
Delta Air Lines, Inc. disclosed an investor presentation for the J.P. Morgan Industrials Conference on March 17, 2026, noting that domestic and international unit revenue grew in the mid-single digits year over year.
- Director or officer change · SEC 8-K
Delta Air Lines announced leadership changes including the retirement of John Laughter, the appointment of Peter Carter as President, Daniel Janki as Chief Operating Officer, and Erik Snell as Chief Financial Officer.
Catalyst calendar
management-stated targets — from the latest earnings call; plans, not promises.
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through the end of the year and into 2027
further improve recovery performance
Source quote
“We expect to further improve recovery performance through the end of the year and into 2027.”
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In the December quarter
revenue momentum to continue and nonfuel cost performance to improve
Source quote
“In the December quarter, we expect revenue momentum to continue and nonfuel cost performance to improve.”
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For the full year
deliver pretax profits of roughly $4.5 billion
Source quote
“For the full year, we expect to deliver pretax profits of roughly $4.5 billion fairly close to last year's profitability.”
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this year
remuneration of more than $9 billion
Source quote
“The Delta American Express partnership continues to deliver strong momentum and we now expect remuneration of more than $9 billion this year on the way to 10 billion.”
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this quarter
meaningful enhancements to service
Source quote
“We continue to work closely with ViaSat and Hughes on meaningful enhancements to service we will see this quarter.”