Delta Air Lines reported adjusted first-quarter pre-tax income of $532 million, a 42% increase over the same period last year, even as fuel costs and investment losses pushed the carrier to a GAAP pre-tax loss of $214 million.

On an adjusted basis, the Atlanta-based airline posted earnings of $0.64 per share on adjusted operating revenue of $14.2 billion, a record for the March quarter and up 9.4% year over year. GAAP operating revenue was $15.9 billion. The GAAP loss per share was $0.44.

Fuel remains the central pressure point for Delta and the broader airline industry. The company paid an adjusted average of $2.62 per gallon in the first quarter, up 7% from a year earlier. For the second quarter, Delta is projecting an all-in fuel price of approximately $4.30 per gallon, with fuel expense rising by more than $2 billion at the forward curve.

To offset that cost, Delta said it plans to reduce capacity growth, hold second-quarter capacity flat versus a year ago, and move to recapture higher fuel costs through pricing. The company's refinery operation is expected to provide a $300 million benefit in the second quarter, Delta said.

"Demand remains strong, and we are taking actions to protect our margins and cash flow," chief executive Ed Bastian said in a statement. "This includes meaningfully reducing capacity growth, with a downward bias until the fuel environment improves, and moving quickly to recapture higher fuel costs."

Despite the fuel headwind, Delta guided for second-quarter earnings of $1.00 to $1.50 per share, an operating margin of 6% to 8%, and total revenue growth in the low-teens percentage range year over year.

First-quarter demand was broad-based. Premium ticket revenue rose 14% to $5.4 billion, loyalty and related revenue increased 13% to $1.2 billion, and American Express remuneration grew 10% to more than $2 billion. Corporate sales hit a record for the quarter, with all sectors showing positive revenue growth, Delta said. A recent corporate survey cited by the company found that 85% of respondents expect their corporate travel spend to increase or stay the same in the second quarter.

On the balance sheet, adjusted net debt fell to $13.5 billion at quarter end, down $760 million from year-end 2025 and below 2019 levels, the company said. Liquidity stood at $8.1 billion, including $3.1 billion in undrawn revolving credit capacity. Free cash flow for the quarter was $1.2 billion.

Non-fuel unit costs grew 6% year over year in the first quarter, reflecting lower-than-planned capacity growth and higher crew costs. Delta said it expects non-fuel unit cost growth at a similar rate in the second quarter.