Third-quarter earnings fell 26% at Delta Air Lines (DAL), which struggled to overcome a global technology outage that led to thousands of flight cancellations, and indications that growth in air travel is beginning to slow.
Shares slumped almost 6% before the opening bell, dragging down other airlines as well.
Delta earned $971 million, down from $1.31 billion a year earlier. Revenue rose slightly, but spending on labor, airport landing fees and its Delta Connection regional affiliate grew much faster, the Atlanta airline said Thursday.
It said Thursday, however, that it will return to year-over-year earnings growth in the current quarter. Delta figures to benefit from a pullback in flying by lower-cost competitors, and the airline is seeking compensation for the July outage that cost it $500 million.
CEO Ed Bastian said bookings for Thanksgiving and Christmas are strong, but he expects a brief drop in travel spending before the holidays while Americans fret about the outcome of the November elections.
July's global technology outage occurred after CrowdStrike, a cybersecurity firm that provides software to scores of companies worldwide, deployed a faulty update to computers running Microsoft Windows.
The outage disrupted operations at thousands of businesses, including airlines, but Delta was hit particularly hard, prompting a U.S. Department of Transportation investigation into the reasons that it failed to recover as quickly as other airlines.