A $1.2 billion loss for Delta, but recovery is on the radar

FILE - In this May 14, 2020 file photo, several dozen mothballed Delta Air Lines jets are parked on a closed runway at Kansas City International Airport in Kansas City, Mo.   Delta Air Lines says it lost $1.2 billion in the first quarter, but the airline thinks it can by profitable by late summer unless there's a resurgence of COVID-19. Delta reported the results on Thursday, April 15, 2021.  (AP Photo/Charlie Riedel, File)
FILE - In this May 14, 2020 file photo, several dozen mothballed Delta Air Lines jets are parked on a closed runway at Kansas City International Airport in Kansas City, Mo. Delta Air Lines says it lost $1.2 billion in the first quarter, but the airline thinks it can by profitable by late summer unless there's a resurgence of COVID-19. Delta reported the results on Thursday, April 15, 2021. (AP Photo/Charlie Riedel, File) (Copyright 2020 The Associated Press. All rights reserved.)

Delta Air Lines lost $1.2 billion in the first quarter, more than expected, but executives said Thursday that the airline could be profitable by late summer if the budding recovery in air travel continues.

CEO Ed Bastian said Thursday that ticket sales have been stronger in the last two weeks than at any time since the pandemic hit the U.S. last year. So far most of the people boarding planes are vacationers booking trips to mountains, beaches and resorts.

The increase in passengers, combined with lower costs for labor and fuel, helped Delta generate $4 million in cash per day in March after burning cash for the past year.

“It’s clear that our business is turning the corner and we’re moving into an active recovery phase,” Bastian said in an interview. “We see the business continuing to improve as consumer confidence grows.”

However, Delta forecast that second-quarter revenue will be down 50% to 55% compared with the same quarter in 2019, which analysts said fell short of expectations.

The company's shares, which have more than doubled since last May, fell 3%.

Several airlines have reported that bookings began to pick up in February and gained speed in March. Delta’s bookings doubled from January to March, although 10% to 15% are using credits from previously canceled flights. U.S. leisure sales have recovered to 85% of pre-pandemic levels, Delta said.

Airlines are adding flights for the summer vacation season in the expectation that passengers will show up. American Airlines said Wednesday that it expects to run about 90% of its U.S. pre-pandemic schedule this summer.