Delta Air Lines has downgraded its profit outlook for 2026 amid soaring jet fuel costs, although CEO Ed Bastian emphasized that consumer demand remains robust. The airline now projects adjusted earnings per share between $5.10 and $5.60 for the year, down from its July forecast range of $6.50 to $7.50. Fourth-quarter guidance also fell short of analyst expectations, and free cash flow is now expected at $2.5 billion, less than the prior $4 billion estimate.

The surge in fuel prices, driven by geopolitical tensions following the Iran war outbreak in February, has sharply increased costs for Delta by roughly $6 billion this year. Jet fuel prices in the U.S. Gulf of Mexico area have nearly doubled to $4.34 per gallon compared to last year. Despite these challenges, fare increases have been accepted by travelers across all segments, including business and leisure, with Delta forecasting a 20% revenue rise in the fourth quarter over last year.

Delta’s third-quarter results, covering the summer travel peak, showed revenue growth of 16% at $17.59 billion, although the airline missed earnings estimates for the first time in two years with adjusted earnings per share of $1.72 versus the expected $1.75. Net income dropped by 47% year-over-year to $756 million, highlighting the pressure of rising operational costs like fuel despite continued strength in premium and main cabin ticket sales.

In related company news, Delta plans to enhance onboard internet service by adopting Amazon’s Leo satellite system, diverging from other carriers that primarily utilize SpaceX's Starlink. This move stirred recent tensions between CEO Ed Bastian and Elon Musk, SpaceX’s CEO, but Bastian downplayed any personal conflict, stating Delta had previously engaged with SpaceX but found their technology was not yet ready to scale at that time.