Delta Air Lines — Key Risks

Fuel Costs Are a Major and Unpredictable Expense

Aircraft fuel represented 17% of Delta's operating expenses in 2025, down from 21% in 2023, but prices remain highly volatile — the average price per gallon swung between $2.20 and $3.22 just between 2023 and 2025. Because passengers often book tickets well in advance, a sudden spike in fuel prices can leave Delta locked into fares that no longer cover its costs, and the company has historically been unable to fully pass those increases on to customers through higher fares.

A Single Software Outage Nearly Grounded the Airline

Delta openly acknowledges that the July 2024 CrowdStrike software update failure — a faulty patch from a cybersecurity vendor — significantly disrupted its IT systems and operations. This is not a hypothetical: it already happened, and Delta warns that its current disaster recovery plans may not be adequate to prevent similar events in the future. Given how deeply the airline depends on technology for ticketing, check-in, crew scheduling, and operations, another outage could cause serious financial and reputational damage.

Delta Owns a Refinery, Which Carries Its Own Unique Risks

Delta owns Monroe Energy, a petroleum refinery it uses to supply jet fuel. While this offers some cost advantages, it also exposes Delta to risks no typical airline faces: refinery accidents, environmental violations, PFAS chemical contamination liability, and the obligation to purchase RINs (renewable fuel credits) on a volatile open market. Monroe's insurance does not cover all potential losses, and a major incident could hit Delta's financials directly.

Key International Partnerships Could Unravel

Delta's global network depends heavily on joint ventures and equity stakes in foreign airlines. A real example is already unfolding: the U.S. Department of Transportation revoked Delta's antitrust immunity (a special legal permission allowing airlines to coordinate pricing and schedules) for its partnership with Aeroméxico in September 2025, ordering wind-down of joint operations by January 2026. While a court stay is currently in place, the outcome is uncertain. Losing such partnerships could shrink Delta's international reach and reduce revenue from those routes.

Debt Covenants Tied to the SkyMiles Program Limit Flexibility

Delta used its SkyMiles loyalty program as collateral for financing. The agreements tied to this debt restrict Delta's ability to change SkyMiles policies in ways that might reduce the program's value — essentially limiting how Delta can manage one of its most important customer assets. If Delta's financial ratios decline, lenders could demand early repayment or additional collateral, which could create a cascading default across multiple debt agreements.

Growing Environmental Regulations Will Add Costs

Delta faces a tightening web of emissions rules — including the EU's Sustainable Aviation Fuel (SAF) mandate requiring 2% SAF content starting in 2025, rising to 70% by 2050, plus potential expansion of the EU Emissions Trading System to all flights departing Europe by 2027. SAF currently costs significantly more than conventional jet fuel and is not available at meaningful scale. Delta has set ambitious emissions reduction goals it acknowledges it cannot currently meet with existing technology, meaning future compliance costs are real and growing.