Delta Posts $6.39B 1Q Loss

Rising fuel costs bring airline to massive downturn despite sales increase
By Jim O'Neill,  Newser User
Posted Apr 23, 2008 7:46 AM CDT
A Delta Airlines plane prepares to take off from a runway as a United Airlines plane, rear, lands at San Francisco International Airport.   (AP Photo/Jeff Chiu)

(Newser) – Staggering fuel prices overwhelmed a 12% sales increase and pushed Delta Air Lines to a $274-million loss in the first quarter, which ballooned to $6.39 billion on a $6.1-billion non-cash charge reflecting a decline in its market value. Excluding special items—including the bankruptcy-related charge—the airline lost 69 cents a share; analysts had expected 49 cents a share, the Wall Street Journal reports.

The loss, driven by a 50% increase in the cost of fuel, doubles last year’s first-quarter loss of $130 million, when Delta was under Chapter 11 protection. Delta’s shares have fallen 69% in the past year. The proposed Delta-Northwest merger, which would result in the world's largest passenger carrier, is expected to help the airlines cope better with soaring fuel prices.