US government shutdown costs Delta Air Lines $200 million profit hit

Delta Air Lines anticipates a $200 million pre-tax profit reduction in the fourth quarter due to the U.S. government shutdown. The disruption, which affected air traffic controllers and led to flight cuts, dented travel demand. However, Delta reports booking growth has recovered post-shutdown, with demand remaining strong.

Delta Air Lines said on Wednesday it expects a hit of about $200 million to its fourth-quarter pre-tax profit due to the U.S. government shutdown that ended last month.

The impact translates to about 25 cents per share, the company said. In October, the Atlanta-based carrier had forecast an adjusted profit of $1.60 to $1.90 a share for the quarter through December.

The 43-day government shutdown affected flight operations and left thousands of air traffic controllers and other staff to work without pay. The Federal Aviation Administration also mandated flight cuts at 40 major airports due to a shortage of air traffic controllers.

The longest federal government shutdown disrupted tens of thousands of flights and dented travel demand. Combined with weather-related disruptions, the turmoil has prompted some Wall Street analysts to cut fourth-quarter earnings estimates for U.S. carriers by as much as 30%.

Delta, however, said booking growth has returned to initial expectations following the shutdown's end, with demand remaining healthy for the rest of the quarter and trends strong heading into early 2026.

CEO Ed Bastian told a Morgan Stanley conference the airline saw a 5% to 10% drop in bookings immediately after FAA-mandated flight cuts, but said the impact was short-lived. "We're looking forward to a strong December, strong close to the year," Bastian said. "So, I think we're through it."

Delta's shares were up about 3% in afternoon trade.

On Tuesday, JetBlue also said demand during the fourth quarter has remained healthy, with bookings trending in line with expectations except for a brief period during the FAA-ordered flight reductions.

The New York-based carrier said its operations were also affected by Hurricane Melissa in Jamaica, which, together with shutdown-related cancellations, trimmed its fourth-quarter capacity and drove up non-fuel operating costs.

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Source: EconomicTimes
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