Investing.com -- Delta Air Lines (NYSE:DAL) saw its stock rise more than 5% at the open on Thursday after providing investors with an updated outlook for its third-quarter revenue and fiscal year earnings.
Despite cutting its third-quarter revenue forecast due to disruptions caused by a major cyber outage in July, Delta reassured investors with its full-year earnings projection.
The airline now expects third-quarter revenue to be flat to up 1% year-over-year, down from its previous projection of 2%-4% growth.
The revision comes after Delta canceled about 7,000 flights over five days in July following a system outage triggered by a software update from cybersecurity firm CrowdStrike (NASDAQ:CRWD), which impacted Microsoft (NASDAQ:MSFT) customers, including several airlines.
Delta estimated the outage cost the company approximately $380 million in direct revenue losses due to customer refunds and compensation in frequent flyer miles. Additionally, the airline faced $170 million in added expenses related to reimbursing customer expenses and crew-related costs.
Delta expects its fiscal 2024 earnings per share to land at or above the midpoint of its previous guidance of $6 to $7 per share, excluding the $0.45 impact from the IT outage on September quarter earnings per share.
The company’s solid long-term outlook helped fuel the 5% surge in Delta’s stock on Thursday, even as it continues to navigate the fallout from the operational disruptions.
The airline is also facing an investigation from the U.S. Transportation Department over the July cancellations, which could result in additional regulatory scrutiny.
Overall, Delta’s ability to maintain a robust earnings forecast for 2024 despite the challenges has bolstered investor confidence.
This content was originally published on Investing.com
