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Here’s How Much Delta Expects to Lose After Its Big Computer Glitch

September 7, 2016

A Delta airlines customer checks his baggage at San Francisco International Airport.A Delta airlines customer checks his baggage at San Francisco International Airport.
Delta says it's investigating the incident. Photograph by Justin Sullivan—Getty Images

Delta Air Lines (DAL) has lowered its third-quarter forecasts for closely watched profit and revenue measures after a power outage in August forced it to cancel 2,300 flights over a three-day period, the company said in a filing on Wednesday.

Delta, the No. 2 U.S. airline by passenger traffic, said it expected an operating profit margin of 18% to 19%, compared with a prior outlook between 19% and 21%.

Fallout from the outage reduced pretax income by $150 million, or 1.5 percentage points, the company said.

Atlanta-based Delta also said it expected a measure that compares sales to flight capacity to decline about 7% in the quarter from a year earlier, with one point stemming from the outage. It had previously forecast a fall of 4% to 6%.


Shares of Delta rose more than 2% in early trading as the news appeared to relieve investors who were braced for a bleaker outlook. At least two analysts said last week that they expected the revenue measure to decline by 7% at most.

For months, extra flights from rivals and attacks from Paris to Istanbul have forced airlines to sell cheaper tickets to keep filling their planes. Delta said moves to cut its growth in U.S. flight capacity this autumn had already begun to pay off, improving revenue trends.