Delta Airlines - $DAL.US

What is Delta Airlines’ History?

Delta Air Lines, Inc. provides scheduled air transportation for passengers, freight, and mail over a network of routes. The Company offers flight status information, bookings, baggage handling, and other related services. Delta Air Lines serves customers worldwide.

What Delta Airlines is doing in more details?

Delta Air Lines is one of the world’s largest airlines by traffic. Through its regional carriers, the company serves about 900 destinations in about 140 countries, and it operates a mainline fleet of 1,100- plus aircraft, as well as maintenance, repair, and overhaul (MRO) and cargo operations.

The airline serves more than 200 million customers each year and offers more than 5,000 daily flight s. Delta is a founding member of the SkyTeam marketing and code-sharing alliance (airlines extend their networks by selling tickets on flights), which includes carriers Aeroméxico, Air France-KLM, China Eastern, Korean Air, and Virgin Atlantic.

Customers from the US account for approximately 80% of sales.

Where Delta Airlines is Operating?

Delta divides its operations into two segments: airline and refinery. The airline segment, which accounts for 85% of Delta’s sales, provides scheduled air transportation for passengers and cargo throughout the US and around the world and other ancillary airline services, including maintenance and repair services for third parties.

The refinery segment (some 15% of total sales) provides jet fuel to the airline segment from its own production and through jet fuel obtained via agreements with third parties. The costs included in the refinery segment are primarily for the benefit of the airline segment.

By product type, economy/coach tickets accounts for nearly 40% of total revenue, while business cabin and premium tickets generate about 25%. Loyalty travel awards, travel-related services, cargo, and other services accounts the remainder.

Where is the geographical reach of Delta Airlines?

Atlanta, Georgia-based Delta operates from hubs in Amsterdam, Atlanta, Boston, Detroit, London-Heathrow, Los Angeles, Mexico City, Minneapolis-St. Paul, New York-LaGuardia, New York-JFK, Paris-Charles de Gaulle, Salt Lake City, Seattle, Seoul-Incheon and Tokyo-Haneda.

The US market is its largest, representing about 80% of net sales. Delta directly owns an oil refinery in Pennsylvania, operated by subsidiary Monroe Energy. Monroe, which supplies a large chunk of Delta’s jet fuel, is loss-making and Delta execs are having a hard time finding a willing buyer.

What is Delta Airlines’ Sales and Marketing Strategy?

Delta’s tickets are sold through various distribution channels including telephone reservations,, and traditional brick and mortar and online travel agencies.

Delta annual advertising expense was $119 million, $288 million and $267 million for the years ended 2020, 2019 and 2018, respectively.

What is Delta Airlines Financial Performance?

The revenue growth of Delta for a five-year period starting in 2016 showed an upward trend, except in 2020 when it dipped remarkably by 64%.

In 2020, revenue fell by 64% to $17 billion compared to $47 billion in 2020. The decline was due to reduced demand resulting from the COVID-19 pandemic.

Net loss attributable to Delta was $12.3 billion, from $4.7 billion of net income in 2019. The loss in profit was due to low operating revenue and restructuring charges.

Delta’s cash position strengthened in 2020, ending the year $6.3 billion higher at $10 billion. It used $3.8 billion from its operations, while investing activities used $9.2 billion and financing activities generated $19.4 billion.

Delta’s primary cash uses during the year were for purchase of short-term investments, and payments on debt and finance lease obligations.

What is Delta Airlines Future Strategy?

An important part of the Company strategy to expand its global network has been to make significant investments in airlines in other parts of the world and expand its commercial relationships with these carriers, including through joint ventures.

It expects to continue exploring ways to expand its relationships with other carriers as part of its global business strategy. Delta’s alliance with SkyTeam extends the airline’s reach to more than 900 destinations in over 140 countries around the globe.

The company gets a boost in global coverage with airlines around the world coming aboard the SkyTeam alliance. Delta has five joint ventures with foreign carriers.

To boost its position in the important region of China, Delta acquired a 3% stake in China Eastern, one of the leading airlines in China. The move allows Delta and China Eastern to compete more effectively on routes between the US and China and provided more travel options for customers in both countries.

Looking to Europe, Delta has joint ventures with Air France and KLM, and plans to build its presence in its strategically advantaged hubs in Paris and Amsterdam, while de-emphasizing higher Europe point-of-sale markets.

It also holds a 49% equity investment in Virgin Atlantic, which improved its presence in London, one of Delta’s largest revenue markets from the US.

Targeting the Asia/Pacific region for growth, in 2018 Delta and Korean Air formed a joint venture, increasing air traffic between the United States and certain countries in Asia.

Delta also has a joint venture with Virgin Australia, serving traffic between the US and Australia/New Zealand; and Mexican airline Aeroméxico, which includes a joint MRO operation in Queretaro (in addition to trans-border flights between the US and Mexico).

What is Delta Airlines’ History?

Delta Air Lines was founded in Macon, Georgia, in 1924 as the world’s first crop-dusting service, Huff-Daland Dusters, to combat boll weevil infestation of cotton fields. It moved to Monroe, Louisiana, in 1925.

In 1928 field manager C. E. Woolman and two partners bought the service and renamed it Delta Air Service after the Mississippi Delta region it served. About 80 years later, Delta became one of the world’s largest airlines by traffic after its $2.8 billion acquisition of Northwest Airlines in 2008.

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