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BusinessDelta, Struggling With Omicron and Storms, Posts Quarterly Loss

Delta, Struggling With Omicron and Storms, Posts Quarterly Loss

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Delta Air Lines said on Thursday that it lost $408 million in the final three months of last year, as the Omicron variant of the coronavirus interfered with holiday operations and pushed back the airline’s recovery.

“While the rapidly spreading Omicron variant has significantly impacted staffing levels and disrupted travel across the industry, Delta’s operation has stabilized over the last week and returned to preholiday performance,” Delta’s chief executive, Ed Bastian, said in a statement. “We are confident in a strong spring and summer travel season with significant pent-up demand for consumer and business travel.”

A mix of bad storms and staff calling out sick forced airlines to cancel tens of thousands of flights over the busy holiday travel period. Delta alone scrubbed more than 2,000 flights over the two weeks starting on Christmas Day, the fourth most flight cancellations among U.S. airlines.

Mr. Bastian said on CNBC on Thursday morning that about 8,000 employees had called out sick over the past four weeks, representing more than 10 percent of its work force. United Airlines said this week that about 3,000 employees, more than 4 percent of its staff, recently tested positive for the virus. Almost all employees at both airlines are vaccinated.

Shortly before Christmas, Delta warned the Centers for Disease Control and Prevention that the virus could disrupt holiday travel and asked the agency to shorten its recommended isolation time for people who test positive for the virus. That wish was granted days later, setting off a feud with one of the nation’s most prominent airline labor unions, which said that shortened isolation periods put workers and travelers at risk.

Airlines finally recovered from their holiday disarray this week, but Omicron is expected to weigh on travel in the coming months, Delta’s president, Glen Hauenstein, said in the statement.

“The recent rise in Covid cases associated with the Omicron variant is expected to impact the pace of demand recovery early in the quarter, with recovery momentum resuming from Presidents’ Day weekend forward,” he said.

The airline expects revenue over the first quarter to be about 72 to 76 percent of the level it was in a similar period in 2019, compared with 74 percent in the final quarter of last year. The airline said it eked out a small $208 million profit over all of 2021, thanks to about $4.5 billion in federal relief to pay workers. Delta lost more than $12 billion in 2020 and had a profit of about $4.8 billion the year before.

Delta is the first major airline to report its fourth-quarter financial results. American Airlines and United are expected to announce next week, followed by Southwest Airlines the week after.



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