How Did Delta Perform Operationally In August?
In the month of August 2016, the legacy carrier, Delta, saw its capacity increase slightly, in line with the guidance. However, its passenger traffic decreased by 2.8%, and passengers boarded declined by 3.1%. To make matters worse, the carrier’s unit revenues dropped by as much as 9.5%. Delta attributes most of this decline to the outage in August that led to approximately 2,300 cancellations. The other reasons sighted by the airline included the ongoing supply-demand imbalance in the transatlantic region, and headwinds from its yen hedge positions. The fall in PRASM led to Delta suffering a loss of approximately $100 million in the month of August. The company has revised its third quarter unit revenue outlook downward to 4%-6%, on the back of this incident, but remains confident about turning the metric around by the end of the year as planned.
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