MW Americans are about to hit a new air-travel record. But demand is still in a holding pattern.

By Claudia Assis

American, Delta and United report earnings soon, with Wall Street eyeing capacity tweaks

Major U.S. airlines' financial snapshots are around the corner, with Wall Street predicting that, despite heightened demand around major holidays, the companies are likely to tweak down their passenger capacities to reflect lower demand for the rest of the year.

Delta Air Lines Inc. is first out of the gate, reporting second-quarter earnings next week, and will set the tone for the rest of the U.S. majors.

Wall Street sees premium doing better than main-cabin tickets, and international travel better than domestic travel, so Delta and its two competitors, American Airlines Group Inc. $(AAL)$ and United Airlines Holdings Inc. $(UAL)$, are more insulated against revenue and earnings risks, unlike low-cost and ultralow-cost airlines.

Investors "will be looking for commentary on green shoots in demand, and any further commentary on [second half of 2025] capacity cuts could be viewed positively," analyst Andrew Didora of BofA Securities said in a note Tuesday. The industry continues to work towards balancing supply with demand, he added.

Supply doesn't seem to be an issue going forward: Travel and leisure group AAA said last month it expects 5.84 million travelers will fly to their destinations on the Fourth of July, a 1.4% rise over the previous record set last Independence Day week of 5.76 million air travelers. Roadtrips are also expected to set fresh records.

A roundtrip domestic flight is averaging $810, about 4% more expensive than last year, AAA said.

Delta Air Lines is scheduled to report quarterly results on July 10. Analysts polled by FactSet expect Delta to report adjusted earnings of $2.04 a share, which would be down from an adjusted $2.36 a share in the second quarter of 2024. Sales are seen matching the year-ago quarter's at $15.41 billion.

United Airlines and American Airlines are expected to follow about a week later. The FactSet consensus for United calls for adjusted profit of $3.83 a share, which would be a decline from $4.14 in the year-ago quarter, on sales of $15.37 billion, up from $14.99 billion a year ago.

Expectations for American Airlines also call for less profit and lower sales in the April-June quarter: FactSet analysts estimate adjusted profit of 79 cents a share, compared with $1.09 a share a year ago, and sales of $14.28 billion, down from $14.33 billion.

An American Airlines spokesperson said that the company would announce its second-quarter earnings date next week. United did not immediately return a request for comment.

There's less visibility into the postsummer, off-peak season after mid-August, Raymond James analyst Savathi Syth said in a note on Tuesday.

Syth expects second-quarter earnings to come in ahead of consensus across the board, but third-quarter outlooks are likely to be in-line to worse, she said.

The analyst also expects a "postsummer domestic rationalization," with much of the moderation in the third quarter happening after the peak summer travel period.

American Airlines shares are down about 33% this year, with Delta shares losing about 18% and United off 17%. That contrasts with gains of around 5% for the S&P 500 index SPX and compares with a loss of about 8% for the U.S. Global JETS ETF JETS in the same period.

-Claudia Assis

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July 01, 2025 12:38 ET (16:38 GMT)

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