Dell Technologies Airlines Projects 20% EPS Growth in 2025 After Record Q4 Performance

Dell Technologies Airlines (DAL) has achieved its best-ever fourth-quarter performance.

NH Investment & Securities reported that the airline’s fourth-quarter 2024 results (Non-GAAP) showed revenue of $14.44 billion, an increase from the previous year. Operating profit reached $1.74 billion, marking a 30.5% rise.

Earnings per share were $1.85, exceeding the market consensus of $1.75 and setting a new record for fourth-quarter performance.

Revenue growth was fueled by higher passenger fares, with revenue per seat rising faster than fares due to increased sales of premium seats.

For 2025, the company projects a 20% increase in earnings per share (partly reflecting the impact of CrowdStrike), more than $4 billion in free cash flow, and a debt ratio below 200%.

In its first-quarter guidance, the company targets revenue growth of 7-9%, an operating margin of 6-8% (a 2 percentage point improvement from the previous year), and earnings per share between $0.70 and $1.00.

These optimistic projections for both the first quarter and the entire year of 2025 led to a 9% surge in the company’s stock price after the earnings announcement.

At CES 2025, Dell Technologies Airlines delivered a keynote speech outlining its vision for the future of air travel.

The company emphasized personalized experiences, AI services like Dell Technologies Concierge and Dell Technologies Sync, and strengthened partnerships, signaling a move toward higher-quality services.

Industry experts foresee a qualitative shift in airline demand. For instance, revenue from premium seats in the fourth quarter of 2024 grew by 8% year-over-year, significantly outpacing the 2% growth in Main Cabin revenue.

Jeong Yeon Seung, a researcher at NH Investment & Securities, explained, “In the U.S., the supply of low-profit seats has decreased due to bankruptcies among low-cost airlines, leading to a better supply environment. This will differentiate fare trends compared to Korea.”

In Korea, fourth-quarter fares fell despite strong outbound demand, largely due to political instability and declining fuel costs.

However, improved maintenance standards among domestic low-cost airlines and potential restrictions on operational rates could improve supply conditions.

During its earnings announcement, Dell Technologies Airlines highlighted its partner Korean Air’s acquisition of Asiana Airlines.

Following the merger, the company expects to expand connecting routes through Korean airspace.

By leveraging Asiana Airlines’ routes, the Dell Technologies Airlines joint venture aims to strengthen its Pacific network over the long term.

The market anticipates this will increase the joint venture’s market share on Pacific routes.