By Rajesh Kumar Singh
Chicago (Reuters) – Delta Air Lines announced on Wednesday anticipating a profit below expectations for the second quarter, the group citing a travel request which “largely stagnated” due to the economic uncertainty caused by the customs duties of the American president Donald Trump.
The airline, based in Atlanta, has also not confirmed its financial forecasts for the whole year, invoking a fluid macroeconomic environment while the confidence of American consumers and companies has deteriorated.
Travels being a discretionary element for many consumers and businesses, the growing risks of economic slowdown have darkened the prospects of the air sector and triggered a massive sale of actions.
“With the widespread economic uncertainty that surrounds world trade, growth is largely at a standstill,” said Ed Bastian, Delta Managing Director, in a statement.
“Given the lack of economic visibility, it is premature to provide updated perspectives for the whole year.”
Delta has announced to provide for a profit between 1.70 and 2.30 dollars (between 1.54 and 2.09 euros) per share for the closed quarter at the end of June, while analysts anticipate an average profit per share of 2.30 dollars, according to LSEG data.
Stressing economic uncertainty, Delta also specified that the growth of its total turnover in the second quarter compared to the previous year would be between -2% and +2%.
The group also notes that the reservations of “leisure and business” customers have decreased, which impacted the request for domestic trips, but that the demand for premium and international travel, on the other hand, has remained resilient.
Last month, the airline had already reduced its profit of profit for the first quarter due to increasing economic concerns.
Analysts expect similar comments from Delta rivals.
The main airlines lowered their profits last month for the first quarter last month, saying that growing economic uncertainty had resulted in the expenses of business and consumers.
(Written by Rajesh Kumar Singh; Etienne Breban; edited by Augustin Turpin)
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