The Covid-19 omicron variant caused a downturn in Delta's business.
The omicron wave will cost Delta between $60 million and $70 million in January and February, turning those months into money losing ones.
Delta executives expect profitability to return in March and continue through the summer and fall quarters.
"We think it is going to be a quick rebound," Ed Bastian said during the airline's Q4 earnings call Thursday. He said there are strong bookings after the Presidents' Day weekend.
The long-term effect of omicron will be to speed the normalization of Covid-19 from a pandemic to a predictable seasonal endemic for which the carrier can prepare and schedule.
He said the path to normalcy was even more certain.
Advisors say travelers are hardened.
The operations have been stable.
Since December 23, Delta has canceled more than 2,200 mainline flights. The four-day period that ended on Wednesday had 34 of those canceled.
The Christmas and New Year's holiday was one of the most challenging travel periods that Delta has experienced, but the carrier has now recovered.
He said that he's comfortable with the carrier's staffing level, and Delta plans to hire up to 5,000 employees this year.
The CEO said that you can't plan in advance for something like omicron.
Regional and trans-Atlantic flights were affected.
Delta's short-term capacity plans are still being impacted by Omicron. The carrier now expects capacity to be between 83% and 85% of the level in the first quarter. Delta's plans to reduce the schedule have been affected by new omicron-related restrictions.
Delta expects to have Europe capacity restored to 85% to 90% of summer's level, according to the president.
Delta has reduced its Delta Connection regional network capacity by 20% to 25% due to demand weakness and a pilot shortage that is impacting regional airline partners. SkyWest stopped selling flights to Grand Junction, Colo., and Lincoln, Neb., on January 10.
"We're pretty confident by the second half of this year that we'll be able to restore a lot of the small and medium communities, and we'll be able to do that on a pilot basis," he said.
Delta is profitable because of federal funds.
Delta had a net loss of $400 million in the fourth quarter. The fourth quarter revenue of $9.47 billion was below the previous year but still beat analyst expectations.
Delta had a net income of $280 million for the year. Delta had an adjusted net loss of $2.6 billion, which excludes the payroll support revenue it received from the federal government.
Revenue for the year was down 34% from 2019.
The carrier announced on Thursday that it would reward most of its employees with a $1,250 profit-sharing payment.
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