Delta's corporate and premium revenue grew year over year in the third quarter, though the carrier is beginning to see some declines on international routes due in part to the trade war with China.
Corporate revenue increased 5 percent, driven by an 8 percent rise in domestic corporate revenue, Delta president Glen Hauenstein said on an earnings call. International corporate revenue, however, had a "modest decline," he said. Even so, the carrier's latest survey of corporate customers showed that 86 percent expect to maintain or increase travel spending in 2020, he said.
Revenue from premium products rose 9 percent, including an 11 percent increase on domestic premium product revenue. Hauenstein said that growth "is expected to grow, with our modernization of our fleet and improved ability to sell these products."
Total revenue for the quarter increased 6.5 percent year over year to $12.6 billion, which the carrier said was a quarterly record. Total domestic revenue rose 7.8 percent and domestic capacity went up 4.5 percent.
The Pacific was the only region in which revenue declined: by 4.6 percent, even as capacity increased 3.3 percent. Corporate travel in the manufacturing and automotive sectors declined on those routes, and that relates to tariffs, Hauenstein said. On transatlantic routes, revenue rose 3.2 percent year over year as capacity increased 4.9 percent. U.S. point-of-sale business was strong on those routes while demand in Europe was weaker, according to Hauenstein. Latin America was Delta's strongest performing region for the quarter, as revenue rose 1.2 percent amid a 2.3 percent decrease in capacity.
Overall, Delta's traffic increased 5.6 percent year over year in the quarter, and capacity increased 3.9 percent. Load factor rose 1.4 percentage points to 88.3 percent. Yield increased 0.1 percent.
Delta reported a net income of $1.48 billion for the quarter, up from $1.32 billion in the third quarter of 2018.
RELATED: Delta Q2 earnings