Delta Air Lines sees the momentum behind 6.5% quarterly revenue growth continuing throughout the year, Chief Executive Ed Bastian said, citing strong domestic demand that drove an increase in its full-year profit forecast.

Shares in Delta gained about 2 per cent the No. 2 US carrier posted a 39% surge in quarterly profit, benefiting from higher fares and fuller planes.

Atlanta-based Delta is the first of US major airlines to report second-quarter earnings, which investors are scouring for signs of weakening consumer demand and the impact of supply constraints due to the three-month grounding of Boeing Co’s 737 MAX.

Delta does not operate the MAX, which remains grounded following two fatal crashes, allowing it to avoid fleet headaches that have plagued North American MAX carriers, including Southwest Airlines, American Airlines Group and United Airlines Holdings, while picking up passengers that rivals did not have enough aircraft to fly.

Bastian said the MAX grounding had a “marginal benefit” on second-quarter results, but attributed the real growth driver to demand strength and higher premium ticket prices.

“We had five of the top 10 revenue days in our history just within our last 30 days and we see that momentum continuing to grow throughout the year,” Bastian said in a telephone interview.

“I don’t think it’s as much the MAX as Delta that’s driving that,” he said.

As a result, Delta lifted its full-year profit forecast to between $6.75 and $7.25 per share from a previous range of $6 to $7 per share.

Supply constraints related to the 737 MAX are expected to help second-quarter unit revenues, a closely watched measurement of revenues per available seat mile, across the sector, even for MAX operators.

Reuters