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Shares of Delta Air Lines rose on Thursday after the Atlanta-based carrier raised its earnings guidance for the year following strong demand for travel. Its CEO said the company also benefited from the grounding of Boeing 737 Max aircraft from its competitors.
Delta said it hopes to earn $ 6.75 to $ 7.25 per share this year, compared to an earlier estimate of $ 6 to $ 7 per share. Shares rose more than 2% after the publication of quarterly results.
Delta does not operate the Boeing 737 Max, blocked worldwide since mid-March following two fatal accidents that claimed the lives of 346 people.
"We do not fly the Max and we clearly have an advantage for the airline during the quarter," Delta CEO Ed Bastian told CNBC's Squawk Channel on Thursday.
US, Southwestern and US competitors canceled thousands of flights during the peak summer period and removed the 737 Max from their schedules until the end of the season as 39, plane remains on the ground. Regulators have not indicated when they will allow planes to fly again.
"It took longer than we would have imagined to put it back into service," Bastian said. "We do not have a crystal ball on it."
Delta's earnings for the second quarter increased by approximately 30% over the previous year and exceeded analysts' expectations, as strong demand, particularly for high-end cabs and business travel, has resulted in an increase in profits.
Delta posted earnings per share of $ 2.35, after adjusting for a record $ 12.5 billion in business, roughly in line with estimates. Higher revenue from premium cabins and business travel contributed to higher sales, the airline said. Net income reached $ 1.4 billion compared to $ 1.04 billion in April-June 2018.
Delta expects earnings per share of $ 2.10 to $ 2.40 in the third quarter. Analysts expected earnings per share of $ 2.18 in the third quarter.
Delta executives are holding a call with investors at 10 am ET.