Despite dour outlook on consumer travel, Delta stock soars on tariff pause

Budget-conscious travelers are booking fewer flights on Delta Air Lines, the No. 1 carrier at Minneapolis-St. Paul International Airport, offering a fresh glimpse of consumer anxiety around travel and the U.S. economy.

Yet after releasing a first-quarter earnings report that beat investor expectations Wednesday, Delta’s stock rose about 7%. The stock ended the day up 23% following news from the White House of a 90-day pause on many new tariffs.

In its earnings announcement Wednesday, Delta jettisoned full-year financial guidance for 2025, as the company cited flatter sales than anticipated in the first few months of the year. Company officials are pointing to a period of unpredictability as domestic travel demands have weakened since late February.

CEO Ed Bastian said during a call with analysts Wednesday morning the company’s growth had “largely stalled” because of “broad economic uncertainty around global trade.”

Executives are paying close attention for any similar trends in Delta’s premium offerings and international travel, but say those revenue lines are holding strong. Looking longer term, Bastian pointed to the company’s past triumphs despite industry headwinds.

“Obviously, in this environment, there’s not a lot that you can say in the next year or two without having some better clarity as to how the tariff skirmishes end up,” Bastian said, adding he anticipates some opportunities to come up “during this bump in the road.”

“We’re not quite sure how long it’s going to be, but I’m confident it’s not going to be elongated. And you can expect that the strong will get stronger,” Bastian said.

The Atlanta-based airline reported $240 million in income on $14 billion in revenue, beating Wall Street estimates. Adjusted earnings per share arrived at 46 cents, above consensus projections of 39 cents per share.

In the next quarter, the beginning of peak travel season, Delta is forecasting growth of $1.5 billion to $2 billion in revenue, on pace with last year.

Still, Delta officials acknowledged a turbulent start to what executives initially projected as a banner year in 2025. Before the downturn in sales, expectations of eased industry regulation and lower taxes led the airline’s business leaders to project record-setting profit in the first quarter, which traditionally marks the slow season for air travel.

Those near-term hopes faltered last month as surveys showed consumer confidence dropping broadly. Airline industry leaders for both larger and smaller carriers scaled back earnings expectations to match early warning signs of lessened consumer appetites.

In March, Delta halved its first-quarter earnings outlook, citing lower-than-expected traffic that first cropped up in late February. Top competitors United Airlines and American Airlines reduced expectations on financial performance.

Uncertainty around the U.S. trade war is believed to have taken a serious toll on ticket purchases as consumers examine where to cut spending. Delta officials also reported some choppiness in the business travel sector as the threat of reduced profits creeps across other industries.

Investors punished airlines when President Donald Trump unveiled a sweeping tariff plan that sparked a market sell-off not seen since the early days of COVID-19. Airline stocks initially nosedived this week alongside major U.S. indexes, prompting worries among economists and business titans that the massive tax increases on imports could slow growth or even push the country into recession.

Broader industry challenges so far in 2025 include bad weather conditions and perceived safety concerns. Business executives have highlighted the fatal American Airlines crash in January over Washington, D.C., and Delta’s crash landing in Toronto as partial causes for the recent downturn.

Delta’s earnings report comes two months after Flight 4819 took off from MSP and crashed at Toronto Pearson International Airport. A preliminary report last month showed the plane descended too quickly and a part of its landing gear failed. All 80 aboard — 76 passengers and four crew members — survived the fiery wreck after the CRJ-900 passenger jet flipped over and skidded down the runway.

Delta is by far the Twin Cities’ dominant airline, carrying about 70% of the airport’s passenger market share last year. Minneapolis-based budget carrier Sun Country, which also marginally measured its financial outlook and witnessed a rollercoaster stock price this past week, holds the No. 2 spot for passengers at MSP.

MSP is Delta’s second-largest hub airport in the U.S. after Atlanta, according to the Metropolitan Airports Commission. Local passenger counts in 2024 grew by roughly 7%, boosted largely by international travel thanks to newer nonstop flights from the Twin Cities to Europe, including routes offered by Aer Lingus and Lufthansa.

Year-over-year foot traffic at the airport is down so far this year. In February, the latest available data from the commission, MSP’s total passenger count dropped nearly 4% as major airline operations and charter flights carried fewer people.

Delta employs about 100,000 people across the U.S., including 9,300 in Minnesota. Roughly 7,300 employees reside in the state, according to the company.