Delta Air Lines reported a $5.7 billion net loss in just three months, as the global COVID-19 pandemic affects consumer demand and confidence in air travel.
Delta's $1.47 billion in revenue was down 88% from April to June 2020, compared to the same quarter last year, when it reported revenue of $12.54 billion. A recovery will take years.
The loss "illustrates the truly staggering impact of the COVID-19 pandemic on our business," Delta CEO Ed Bastian said in a press release Tuesday. "Given the combined effects of the pandemic and associated financial impact on the global economy, we continue to believe that it will be more than two years before we see a sustainable recovery."
FILE - An agent works the counter at the Delta Air Lines terminal at the Los Angeles International Airport, May 28, 2020.
Delta raised about $11 billion over the quarter, including $5.4 billion in loans and grants from the federal CARES Act's payroll support program. In exchange, the company agreed not to furlough or lay off staff until Oct. 1. The number of employees affected will depend on how many take early retirement offers, buyouts or voluntary leaves. At least 15,000 have so far, ahead of a Monday deadline.
U.S. airlines saw a hint of a recovery midway through the quarter, but as the country's COVID-19 outbreak worsens, fewer people are traveling.
"Growth has stalled," Bastian said. "It was growing at a pretty nice clip through June. The virus, unfortunately, was also growing."
Delta reported that the number of passengers boarding its planes dropped 93% compared to the same quarter last year. The airline will only add back 500 flights at most in August, instead of the 1,000 it had planned.
Delta has until Sept. 30 to decide if it will take another $4.7 billion in federal loans. American, Southwest and United Airlines, the U.S.'s other top air carriers, will report their second-quarter results between July 22 and 23.
Leslie Bonilla contributed to this report.