Delta Air Lines is expecting a significant financial hit related to the upcoming Olympics. The airline announced that reduced travel to Paris due to the games will result in losses of approximately $100 million, which would otherwise have been part of its record-setting second-quarter revenues.
This impact was not unforeseen. Delta President Glenn Hauenstein noted in the previous quarter’s earnings call that travelers enthusiastic about attending the Olympics are not typically the airline’s primary revenue-generating customers.
“The Olympics are not beneficial for airline revenues,” Hauenstein said. “This year is no exception. While we see favorable conditions for overall European travel, Paris faces challenges as business travel generally halts in anticipation of the Olympics.”
Earlier, Air France, a partner of Delta through a loyalty program, also reported that the Olympics negatively impacted their revenues by $193 million.
Delta’s annual report indicates that around 20% of its passenger revenue comes from transatlantic flights, raising concerns about the depressed demand in this segment. However, Delta anticipates that the negative effects of the Olympics will subside by autumn.
“Looking beyond the Olympics, we foresee a robust demand for transatlantic travel this fall,” Hauenstein reassured analysts.