Q3 FY26 · Ended Sep 30, 2026 · View SEC filing
Fuel absorbed the gains from a busier quarter
Revenue rose 21.1% but fuel cost rose 69.3%, so operating income fell even as sales grew.
For investorsWhat Delta's margin depends on from here
For foundersTurning loyalty into a currency others pay for
Revenue rose 21.1% but fuel cost rose 69.3%, so operating income fell even as sales grew.
Aircraft fuel and related taxes were $4.35B, against $2.57B a year earlier, up 69.3%. Fuel was 23.2% of total operating expense, against 17.1% a year earlier, and 21.6% of revenue, against 15.4%.1
Total operating expense rose 25.0% while total operating revenue rose 21.1%. Operating income fell 13.7% to $1.45B, and the operating margin narrowed to 7.2% from 10.1% a year earlier.1
Outside fuel and refinery expense, the large cost lines grew more slowly than passenger revenue, which rose 15.0%: salaries and related costs rose 8.5%, contracted services 9.5%, and landing fees and other rents 10.9%, while maintenance materials and outside repairs were nearly flat.1
AnalysisOn these figures the pressure came from fuel, not from labor or the rest of the network's costs. That ties the margin to a commodity price the airline does not set: it recovers if fares keep pace with fuel or if fuel eases.
Refinery revenue of $2.60B was matched by the same amount of refinery expense, so total growth overstates the airline's own growth.
Refinery revenue, the sale of refined products to other buyers, rose 76.2% to $2.60B, 12.9% of total operating revenue against 8.9% a year earlier. Refinery expense was also $2.60B, up from $1.48B.1
The airline's own growth was slower: passenger revenue rose 15.0% to $15.53B, below the 21.1% rise in total revenue, and its share of revenue fell to 77.0% from 81.0%.1
In the segment view, the refinery reported $2.97B of revenue including sales to the airline, and an operating loss of $33M. The airline segment earned $1.49B of operating income on $17.59B of revenue, 102.3% of the consolidated total.1
AnalysisBecause these sales add the same amount to revenue and to cost, they lower the reported operating margin without changing operating income, so margins compared across quarters should allow for how much refinery revenue each carried. Owning a refinery is meant to cushion the fuel bill when refining margins widen; this quarter the segment lost money while fuel cost surged, so its value can only be judged across several quarters.
Loyalty revenue grew 19.2% against 15.0% for passenger revenue, a growing line that carries no fuel bill of its own.
Loyalty and related revenue was $1.35B, against operating income of $1.45B, so it equals 92.6% of operating income. It rose 19.2% from a year earlier, while passenger revenue rose 15.0%, and it equals 8.7% of passenger revenue.1
Its share of total revenue was 6.7%, almost unchanged from a year earlier, but only because refinery sales swelled the total. Measured against passenger revenue, the line gained ground.1
AnalysisThis is a comparison of size, not a margin. Loyalty revenue is a top line: the seats and services members redeem have costs recorded elsewhere, so it does not mean SkyMiles alone earns most of the profit.
AnalysisA line that grows faster than flying and does not burn fuel steadies the business in a quarter like this one. A slowdown in loyalty growth during a weak consumer stretch would remove that cushion when it is most needed.
Growth, profitability and cash over the years, where Delta Air Lines stands among its peers, and where its profit is made.
How the model works, where every $100 of revenue goes against the industry, and how long the company took to scale.
Ten years of filings where the company has them, each against its peers.
Growth against margin in each company's latest full year; the size of a dot is its revenue. Hover a dot to read it, click to open it.
Delta Air Lines, FY2025: revenue +2.8% on the year, operating margin 9.2%. Triangles sit beyond the axes; their figures are in the tooltip.
Each segment's share of revenue beside its share of operating income, as the filing reports them. Airline earns 102% of the profit on 87% of the sales.
The mechanisms behind the numbers. Pick one to read it.
Delta sells miles to card issuers and partners, who hand them to their own customers. Delta collects cash when the mile is sold and delivers a seat later, often one that would otherwise have flown empty.
What needs scale, what a startup can take, and how to test itDelta Air Lines, Q3 FY2026, to operating profit: $7.2 of every $100 is left. Its widest gap from the industry is operating margin: 7.2% of revenue against a median of 17.7%.
Each line as a share of revenue: the band holds the middle half of the Industrials companies covered that report the line, the tick is their median, the dot is Delta Air Lines.
Revenue grew 2.3x from FY2009 to FY2025, first doubling in 14 years (FY2023). The pins mark each doubling of the first year shown.
Every figure is computed from the companies' own filings. Peers are the Industrials companies covered, each from its latest report, which is not a market and not a market share. A description of the business, never a view on its shares.
Revenue went from $28.1B in FY2009 to $63.4B in FY2025, the operating margin from -1.2% to 9.2%, over 16 years.
Capital expenditure is drawn below the axis as cash out. Cash conversion is operating cash flow over net income, shown in the tooltip for years with a profit.
Each breakdown the filing reports, as shares of revenue, for every period it restates.
Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited). The filing restates this breakdown for 1 period.
Click a member to isolate it across the years shown.
Margins, cash and growth for the period, each with what it was computed from.
Every breakdown the filing reports for the period, with each item's share.
| Passenger | $15.5B | 77.0% |
| Other | $4.4B | 21.6% |
| Cargo | $301.0M | 1.5% |
| Refinery | $2.6B | 12.9% |
| Loyalty and related | $1.3B | 6.7% |
| MRO | $296.0M | 1.5% |
| Miscellaneous | $108.0M | 0.5% |
These items do not sum to total revenue; the filing states them beside it. Source10-Q, us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax, as reported in the 10-Q filed 2026-10-09
| Airline | $17.6B | 87.1% |
| Refinery | $3.0B | 14.7% |
These items do not sum to total revenue; the filing states them beside it. Source10-Q, us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax, as reported in the 10-Q filed 2026-10-09
| Domestic | $14.4B | 71.1% |
| Atlantic | $3.9B | 19.2% |
| Latin America | $997.0M | 4.9% |
| Pacific | $959.0M | 4.8% |
| Operating Segments | $17.6B | 87.1% |
| Intersegment Sales/Other | -$366.0M | -1.8% |
These items do not sum to total revenue; the filing states them beside it. Source10-Q, us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax, as reported in the 10-Q filed 2026-10-09
The cost lines beneath operating income, each as a share of revenue, then the operating result.
Costs are reported by nature: what they are (food, labor, occupancy, personnel, marketing), not what they were for, so there is no cost-of-revenue line and no gross profit.
| Cost line | Q3 FY2026 | Of revenue | Source |
|---|---|---|---|
| Total operating expense | $18.7B | 92.8% | Source10-Q, us-gaap:CostsAndExpenses, as reported in the 10-Q filed 2026-10-09 |
| Operating Income | $1.5B | 7.2% | Source10-Q, us-gaap:OperatingIncomeLoss, as reported in the 10-Q filed 2026-10-09 |
Where the operating profit is earned, as the filing reports it.
| Airline | $1.5B | 102.3% |
| Refinery | -$33.0M | -2.3% |
Shares of operating income. Source10-Q, us-gaap:OperatingIncomeLoss, as reported in the 10-Q filed 2026-10-09
From the text of the filing rather than its statements, each with the sentence that states it.
In the March 2026 quarter, we exercised options for 34 Airbus A321neo aircraft.
In addition to this order, we maintain options to purchase 36 Airbus A321neo aircraft.
In the March 2026 quarter, we entered into a definitive agreement with Airbus S.A.S. to purchase 16 Airbus A330-900neo aircraft and 15 Airbus A350-900 aircraft, with an option to purchase up to an additional 20 widebody aircraft.
In the March 2026 quarter, we entered into a definitive agreement with Airbus S.A.S. to purchase 16 Airbus A330-900neo aircraft and 15 Airbus A350-900 aircraft, with an option to purchase up to an additional 20 widebody aircraft.
In the March 2026 quarter, we entered into a definitive agreement with The Boeing Company to acquire 30 Boeing 787-10 aircraft, with an option to purchase up to an additional 30 of the same aircraft.
The income statement, cash flow statement and balance sheet in the company's own order and words. Every line links to the filing.
Year to date, as a quarterly filing reports it.
Delta holds the program in its own subsidiary, which carries dedicated term loans, so lenders treat it as a durable asset.
The filing describes SkyMiles IP Ltd., an indirect wholly owned subsidiary that is party to the SkyMiles term loan credit and guaranty agreement. During the year Delta amended that agreement, refinancing the existing term loans with replacement loans at a variable rate tied to adjusted term SOFR.1
AnalysisMiles are sold to partners before a seat is delivered, so the program brings in cash ahead of its cost. A program that lenders accept as the basis for a dedicated loan shows how predictable that cash has become, and it gives Delta a source of funding that does not rest on its aircraft.
Delta holds purchase options alongside firm orders, so it can add capacity when demand justifies it rather than committing all the capital now.
This year Delta exercised options for 34 Airbus narrowbody aircraft and still holds options to purchase 36 more. It agreed to acquire 30 Boeing widebodies with an option for up to an additional 30, and ordered 16 of one Airbus widebody model and 15 of another, with deliveries scheduled years out.1
Delta also holds long-term financing commitments for a substantial portion of the purchase price that it is "under no obligation to use". Last fiscal year capital expenditures were $4.50B against $8.34B of operating cash flow, 53.9% of it, leaving free cash flow of $3.84B.1
AnalysisOptions turn a fleet plan into a series of later choices. In a business where fuel can move operating income sharply within a year, the ability to defer or skip capacity is a form of protection that a firm order does not give.
An investment loss replaced last year's gain, so net income fell 46.7% while operating income fell 13.7%.
Gain or loss on investments was a loss of $218M, against a gain of $311M a year earlier. Total non-operating items moved from income of $93M to an expense of $380M.1
Income before income taxes fell 39.6% to $1.07B, net income fell 46.7% to $756M, and diluted earnings per share fell to $1.15 from $2.17. Net margin was 3.7% against 8.5% a year earlier.1
Delta is also a lender to Wheels Up, the private aviation company: Wheels Up has drawn on a revolving working capital facility from Delta, and Delta contributed most of a new term loan to it, alongside other shareholders.1
AnalysisNet income therefore reflects the market value of Delta's holdings as well as how the airline ran. The swing can turn in either direction, which makes operating income the steadier read on the business itself.
Aircraft orders and floating-rate debt are set in advance, while fuel, now 23.2% of operating expense, can move sharply.
Delta states it has "committed to future aircraft purchases", with deliveries scheduled years out. Refinanced facilities, including the SkyMiles term loans and a new corporate revolving credit facility, bear interest at a variable rate tied to adjusted term SOFR. Interest expense, net was $146M against $171M a year earlier.1
This quarterly filing names no new risk factors. It states there have been "no material changes" from those in Delta's annual report, so that list still governs.1
AnalysisThe fixed parts of the business amplify the variable ones. With fuel up 69.3% this quarter, operating income fell 13.7% even as revenue rose 21.1%. A fuel spike that lasted while deliveries and debt payments came due would test cash flow, which this filing reports only year to date.
Member research on this company.
What Delta Air Lines's numbers depend on from here, read from the filing: the conditions behind this period's margins and growth, and where a change would show first.
AnalysisFuel against fares. The margin squeeze came from fuel cost growing far faster than passenger revenue. For margins to return to the year-earlier level, either fares and premium demand would have to keep rising alongside fuel, or fuel would have to ease. The gap between the passenger revenue line and the fuel line in the next filings shows which is happening.
AnalysisWhether the refinery does its job. The usual case for owning a refinery is that it cushions the airline's fuel bill when refining margins widen. This quarter the refinery segment lost money while fuel cost surged. The test is the airline's all-in fuel cost against market jet fuel over several quarters, not the refinery's own profit in any one of them.
AnalysisLoyalty growth relative to flying. SkyMiles income grew faster than passenger revenue this quarter. If that continues, a rising share of profit comes from card partnerships and mile sales that do not burn fuel. A slowdown in loyalty growth during a weak consumer stretch would remove that cushion just when fuel is pressing on the rest of the business.
AnalysisCapital commitments against cash. The filing lists widebody orders and narrowbody options that deliver years out, alongside continued debt repayment and refinancing. What would have to be true is that operating cash flow covers aircraft spending through a fuel shock without reversing the debt reduction. The quarter's cash flow is reported year to date, so the annual filing is the cleaner read.
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Business Lens describes Delta Air Lines from its own filings with the SEC. It is not a view on its shares, a target, or advice to buy, sell or hold anything; figures are as filed and may be restated by the company later. The filing, the dates and the version are under the financial data above.
