Another airline is facing financial losses due to the Olympics. Delta Air Lines has announced that reduced travel to Paris during the games will result in an estimated $100 million loss compared to potential earnings, despite record-high second-quarter revenues.
Delta’s president, Glenn Hauenstein, explained to analysts during the latest earnings call that the Olympics generally do not attract the same types of travelers who boost airline profits. “The Olympics are not good for airline revenues,” Hauenstein stated. He noted that while the overall outlook for European travel is positive, business travel to and from Paris typically declines as the Olympics approach.
Earlier this month, Air France, which has a loyalty partnership with Delta, also reported revenue declines due to the Olympics, amounting to a $193 million shortfall.
Delta’s annual report indicates that approximately 20% of its passenger revenue comes from transatlantic flights. The decreased demand in this segment is a concern, but Hauenstein reassured analysts that the impact of the Olympic drag should diminish by autumn. “As we look past the Olympics, we see a very robust fall demand for Transatlantic,” he said.