What can investors expect from DAL's earnings in 2025?

**Delta Air Lines (DAL) is poised for a challenging earnings year in 2025**, and investors should temper their expectations accordingly. Here's a detailed analysis:

1. **Q1 2025 Expectations**: The initial quarter of 2025 is likely to be soft, with Delta Air Lines projecting revenue growth of only 3%-4% and operating margins between 4%-5%. The EPS guidance has been reduced to $0.30-$0.50, down from the previous $0.70-$1.00. This reflects a significant slowdown from the robust performance of the previous quarter.
2. **Impact of Weaker Demand**: The primary driver of the lowered guidance is weak travel demand, particularly in the domestic market. Corporate and leisure bookings have seen a decline, and Delta attributes this to reduced consumer and corporate confidence due to macroeconomic uncertainty. This trend is likely to continue into the first quarter, impacting earnings.
3. **Full-Year Outlook**: Despite the gloomy forecast for Q1, Delta maintains a full-year outlook, with an expectation of EPS to be $7.35+ for 2025. This suggests that while the first quarter may be disappointing, the remainder of the year could see a recovery in earnings, albeit at a lower average than 2024.
4. **Investor Considerations**: Given the current uncertainty, investors should approach DAL's stock with caution. While the stock has declined significantly following the guidance release, it is important to monitor the company's operational efficiency and demand trends closely. The potential for a recession in the U.S. economy as indicated by Delta's comments could further impact airline demand in the near term.

In conclusion, while there is potential for a rebound in Delta Air Lines' earnings in 2025, the first quarter is likely to be disappointing. Investors should consider these factors and adjust their expectations accordingly, looking for opportunities in the stock at lower prices if the market overreacts to the short-term challenges.