Airlines expected to cut 2025 outlooks as travel demand falters
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A Boeing 767-332(ER) from Delta Air Lines takes off from Barcelona El Prat Airport in Barcelona on Oct. 8, 2024. Joan Valls | Nurphoto | Getty Images Waning travel from Canada. Signs of weaker demand across the Atlantic. Mass government layoffs. Tariffs. Consumers pulling back on travel bookings. The worst stock market swoon since 2020. All are signs of concerns for the airline industry. U.S. airlines will likely cut their 2025 outlooks when they report earnings starting this week, analysts say, pointing to cracks in demand for travel, which customers had prioritized even through years of inflation. “Clearly, things are softer than they were in January,” Raymond James analyst Savanthi Syth told CNBC. Delta Air Lines last month cut its first-quarter forecast, citing weaker-than-expected corporate and leisure bookings. American Airlines and Southwest Airlines also cut their outlooks for the first half of the year. Since then, airline stocks have tumbled further, as concerns have grown about weaker demand amid President Donald Trump’s policies, most recently, new globe-spanning tariffs of no less than 10%. “The level of sell-off is worse than the reality right now, but it doesn’t necessarily mean it won’t be the reality six months from now,” Syth said. Stock Chart IconStock chart icon NYSE Arca Airline Index and S&P 500 Wall Street analysts have slashed their price targets and downgraded their ratings on U.S. airlines, even Delta, the most profitable of the U.S. carriers. Like its main rival United Airlines, Delta has said high-income consumers who are willing to shell out more for roomier seats have been a boon to its bottom line in recent years. However, they’re not expecting anything like the pandemic in 2020, when countries closed their borders and air travel demand essentially dried up overnight. It was still the industry’s worst-ever crisis. Demand hasn’t…
Filed under: News - @ April 7, 2025 12:29 pm