Over the years, we’ve seen airlines massively expand their summer schedules to Europe, given the increasing trend of Americans taking at least one summer trip across the Atlantic. Along those lines, Delta executives have made some interesting comments this week, which reflect a new reality that US airlines are dealing with.
In this post:
Delta had a disappointing summer across the Atlantic
On September 11, 2025, Delta President Glen Hauenstein spoke at a Morgan Stanley Event, and revealed that Europe service was the company’s “worst performing entity in the third quarter” (which almost completely overlaps with the calendar definition of summer). That would obviously come as a huge surprise to many people, so what’s driving this weakness? Well, a couple of things…
First of all, Hauenstein explained that “July and August have not been the peak months that they once were in terms of high-end leisure into Europe.” Indeed, family travel to Europe has increasingly shifted heavily to June, while a lot of non-family travel has increasingly shifted to September and October, to avoid the peak. The airline is seeing “a big sequential improvement” in performance across the Atlantic for October, for example.
In July and August, Europe is most expensive (in terms of accommodations) and also hottest, and that’s something that many people are trying to avoid. So I think many travelers are just wisening up.
Second of all, the weakness in Europe comes down to weakness in economy demand. While premium leisure demand remains strong, yields in economy have gone down a bit from their peak. So Hauenstein emphasized that weakness “was all in the main cabin,” and that “premium products across the board are continuing to perform,” and that “within every entity, premium is leading in terms of unit revenues.”
Delta claims that most of its profits are coming from premium travel right now, stating that “you have the high end producing returns, and you have the main cabin really essentially not producing returns that are acceptable.”
So Delta is trying to rationalize capacity in economy, but Hauenstein notes that “we don’t need main cabin to be positive to post positive returns,” and “that’s what we’re seeing now, main cabin is still negative.” The good news for Delta is that weakness in economy demand is partly being offset by improving corporate sales numbers, and Delta claims it had its “highest post-pandemic corporate sales number for any day and any week in this September.”
A longer European season is ultimately good for airlines
The weakening of July and August across the Atlantic is in some ways good for airlines. The airline industry is a tough business, especially given the lack of ability to massively shift capacity (in terms of aircraft, staffing, etc.) based on demand.
For so long, airlines essentially had to design fleet and staffing needs around those peak summer months. That was good in the sense that those months were profitable, but then it was tricky to figure out what to do with those planes in the late summer and early fall, when demand fell greatly.
Having Europe demand be more spread out across six months or so (April through October) is much better than having is just be so heavily focused on a couple of peak months. This is why we’re also increasingly seeing airlines extend their seasonal routes in Europe, to be much longer than in the past.
On this topic, I have to say, I always find the narrative of what constitutes a profitable route to be quite interesting. Delta is the most profitable airline in the United States (though no longer the most profitable in the world), and is incredibly well run. No one disputes that.
Delta had a net income of $4.7 billion in 2024. However, over the course of the year, the cost per available seat mile was 19.3 cents, while the passenger revenue per available seat mile was 17.65 cents. In the end, total revenue per available seat mile was 21.37 cents.
So yeah, Delta is losing a pretty penny (and actually has worse margins than United) if you were to simply compare passenger revenue per available seat mile to cost per available seat mile. But it’s everything else that Delta makes money on (especially its loyalty program), and that leads to the healthy profits.
It sure seems like it can be tough to figure out how to allocate those profits to particular flights. So it’s funny how during the same conference, Hauenstein stated how Europe was Delta’s “worst performing entity in the third quarter, although very profitable still.”
Airline math is just funny, eh? Delta doesn’t really generate many direct profits transporting customers, yet the carrier’s least profitable entity was still “very profitable.”
Bottom line
Despite the popularity of traveling to Europe in summer, Delta executives have reported that Europe was the carrier’s worst performing entity in the third quarter. This largely comes down to less Europe demand in July and August, and weaker economy demand.
The weaker economy demand isn’t surprising, and I’d argue that less of an emphasis on July and August is actually good for airlines, since it allows them to have a longer and more consistent schedule. We’re increasingly seeing American families travel to Europe in June, while those without kids in school travel in April, May, September, October, etc.
What do you make of Delta’s Europe weakness in summer?
you won't let it go, Ben, will you?
AA, DL and UA all use the same business plan of getting revenue from transportation and non-transportation sources.
DL has managed to build its relationship with Amex into the highest revenue airline loyalty program in the world.
AA and UA have simply failed to achieve what DL has done but they do operate the same plans.
And let's also not forget that DL has led...
you won't let it go, Ben, will you?
AA, DL and UA all use the same business plan of getting revenue from transportation and non-transportation sources.
DL has managed to build its relationship with Amex into the highest revenue airline loyalty program in the world.
AA and UA have simply failed to achieve what DL has done but they do operate the same plans.
And let's also not forget that DL has led the industry in paying higher wages since covid; UA, in complete contrast, has 6 amendable labor contracts with all of its large non-pilot unionized groups. UA's labor costs would be alot higher if their employees stopped drinking Kirby's rah-rah koolaid and realized the execs are laughing all the way to the bank at the expense of tens of thousands of UA employees.
and specific to the Atlantic, DL clearly doesn't see the shift in demand including resistance from Europeans as being permanent since they are still growing TATL next year, net of what will be a few cancellations that happen every year.
DL is the financial leader of the industry because it speaks to what professional analysts want to hear and what is really going on in the industry and not endlessly talking about killing off its competitors.
other airlines will say the same things or be asked by Wall Street about what they are seeing - and, as long as they are publicly traded, they have to answer truthfully.
That told’em Tim, how accurate your argument is could be anyone’s guess.
Although DL are miles ahead of UA and the languishing AA in the World Rankings, without their brainwashed American patronage, all three would soon disappear into obscurity on the world stage.
it's not even a question of product
It is a question of accuracy in discussion.
Ben simply cannot lecture us about free speech and then blatantly make statements that are materially false and expect people to take him seriously.
AA, DL and UA all operate w/ the exact same business model except for the refinery which is exclusively DL's thing and which they specifically exclude from some data presentations so that analysts can compare...
it's not even a question of product
It is a question of accuracy in discussion.
Ben simply cannot lecture us about free speech and then blatantly make statements that are materially false and expect people to take him seriously.
AA, DL and UA all operate w/ the exact same business model except for the refinery which is exclusively DL's thing and which they specifically exclude from some data presentations so that analysts can compare airline performance.
The whole PRASM vs. profit non-sense is yet another failed attempt by UA's fan brats that can't admit that UA really does not deliver best-in-class performance where it counts even w/ over 50K UA employees that have yet to see their pay raised while AA, DL and WN and many LCCs have raised their employees' pay even through collective bargaining.
Europeans are not going to the U.S. because they view America an unwelcoming, quasi-fascist state. Most business is reorienting towards other countries quickly (2-3 years) as U.S. financial institutions prized for their independence and transparency become tainted by the incompetent meddling of the Trump administration (stock market doesn’t reflect this yet but it will). U.S. airline executives are loathe to call the real reasons for Europe performing badly out because this government does not espouse...
Europeans are not going to the U.S. because they view America an unwelcoming, quasi-fascist state. Most business is reorienting towards other countries quickly (2-3 years) as U.S. financial institutions prized for their independence and transparency become tainted by the incompetent meddling of the Trump administration (stock market doesn’t reflect this yet but it will). U.S. airline executives are loathe to call the real reasons for Europe performing badly out because this government does not espouse free markets but rather complete sycophancy so speaking out at this critical time is not going to happen due to a very real fear of consequences.
I agree 100% and unfortunately far too many Americans are too stupid/stuck in their political bubble to grasp it.
"(stock market doesn’t reflect this yet but it will)."
Seems like you know a lot more than other people do.
Rather than whining over the internet. I'd suggest you short the market and make billions.
Put money where your mouth is or put a foot in it.
Eskimo, “Put money where your mouth is or put a foot in it”, very sound advice from one who actually practices what one preaches. Thank you for your confirmation bro.
Methinks DL will keep retreating from NYC to Fortress ATL come summer 2026. BRU just the start. Can’t handle the TATL heat!
I see RASM coming right at you.
DL would have to cut a whole lot more than BRU to come close to the capacity cuts that have been pushed onto UA - which UA execs say they wanted all along but never seemed capable of doing on their own.
When you dominate ATL-NYC as much as DL does, the threshold for deploying aircraft for TATL flights is a whole lot higher.
If DL saw TATL weakness, UA saw it even more. DL is simply more responsive to changes in the marketplace than any other airline.
Blasphemy.
So many trigger words.
Bingo card.....check.
Nothing a few more flights to ICN won’t fix!
It might sound radical, but why doesn’t an airline try making economy civilised again? At least back to Y2K comfort levels.
Europe is not only crowded during the Summer, but the prices are now over exaggerated.
i've been to Portugal, the Iberostar Algarve charged us 2000 euros for 5 nights.
Other family members went to Greece, supposed to be one the poorest countries of Europe, they spend a fortune on flights and hotels there...
Prices in America are even higher.
I flew LHR-SFO return last week. Both flights were almost exclusively Americans. Only few europeans were clearly on business like me. Europeans are just not going to the US for holidays any more. The current administration has killed any desire to go there unless you absolutely have to.
Which means more seats for awards
Until the airlines cancel routes.
No one goes to Europe during July or August anymore, it’s too crowded
What needs to be added to this is the loss of demand from Europeans wanting to travel to the US.
I don't know anybody that is planning a trip there, and I personally won't be for at least the next three years.
This does not surprise me. Europe in peak summer has skewed towards ultra premium. For most/average people, they got their big Europe summer trip in the last couple of years (following the pandemic), and rates are extremely high (even the ultra wealthy cannot believe what they charge now) for both airfare and hotels - even economy tickets - which they cannot justify. Premium demand is not going anywhere, but the regular crowd is absolutely affected by the costs.
Interesting, no mention of reduced demand from Europeans travelling to the US for summer vacations. That seems to be case for travel by Canadians to the US.
How myopic that these airline execs ( and bloggers for that matter ) think that Americans are the only ones that ever get on a Delta flight.
They may not be the only ones, but I imagine on US airlines, they're the majority of the demand. I would think Europeans may default to European airlines for trips to the US.
Still, if they're seeing lower demand, unless they're decreasing capacity, you'd think that would lead to overall lower prices if they started offering discounts and US airlines had to match to compete.
DENDAVE says, "They may not be the only ones, but I imagine on US airlines, they're the majority of the demand. I would think Europeans may default to European airlines for trips to the US."
Airlines say 80% of international passengers on US carriers are from the US.
PTO, speaking as a traveller who initiates all journeys from the right side of the pond, the USA is becoming increasingly unpopular to the European travellers. As for U.S. airlines, to the discerning European, it is practically unthinkable to even consider a U.S. carrier.
I doubt Delta will be the only airline experiencing that: seems that the July-August season in general has been weaker this year.
We're still waiting for official figures, but the general sentiment in major destinations like Barcelona, Lisbon or Paris is that attendance was down by a significant margin.