Delta’s Revenues From Premium Travel Surged in 2023
Skift Take
Key Points
- Delta Air Lines saw a 26% increase in premium-seating revenue in 2023, reaching $19.1 billion.
- The airline introduced new premium lounges and revised its loyalty program to benefit high-spend travelers.
- Despite criticism, Delta did not see a drop in bookings or American Express card usage, and its Sky Lounges generated $1.1 billion in revenue.
Summary
Delta Air Lines has significantly increased its revenue from premium travel in 2023, focusing on high-spend travelers with new lounge offerings and changes to its loyalty program. Despite some criticism from frequent travelers, the airline saw a notable rise in premium-seating revenue and continued strong performance from its Sky Lounges. Competitors like United Airlines and American Airlines are making minimal changes to their own loyalty programs, hoping to attract dissatisfied Delta customers.
Ever since the pandemic, Delta Air Lines has gone all in on the premium traveler.
The airline is opening a new tier of lounges that include a restaurant and wellness area. It made changes to its loyalty program that mostly benefited those who were willing to shell out more on airfare.
The carrier generated $19.1 billion in premium-seating revenue in 2023, a 26% increase from 2022. For context, main-cabin seating gave Delta around $24.5 billion in 2023, a 20% gain, according to its most recent 10-K.
In 2019, Delta made $14.9 billion from premium seats and $21.9 billion from the main cabin.
A Loyalty Program for High-Spend Travelers
Some of Delta’s moves to cater to premium travelers have been met with criticism. When Delta first announced it would change its SkyMiles tiers in 2025, many frequent travelers took to social media to say they wouldn’t fly with the airline again or they would stop chasing status.
Right after the changes, Delta executives said they didn’t see a drop in bookings or in the usage of its co-branded American Express card. (Not to mention, that credit card also generated a whopping $6.8 billion in revenue for Delta).
United Airlines and American Airlines made minimal changes to their frequent flier programs, hoping to capture some of those disaffected Delta travelers.
Curbing Lounge Access
Perhaps another sign of Delta’s post-pandemic strength has been its lounges. They’ve been overcrowded as the carrier eased lounge entry requirements during the thick of the pandemic.
But now Delta is doubling down on its efforts to curb access. In September, the carrier announced it would cap lounge entries for those with an American Express Platinum Card or a Delta Reserve American Express Card starting in 2025. And passengers who booked a basic economy ticket wouldn’t be given lounge access starting in 2024 — even if they held one of the American Express cards.
It remains to be seen how these restrictions would impact Delta’s revenue in the long run. But for now the carrier seems to be doing just fine — it netted $1.1 billion dollars in revenue from its Sky Lounges. In 2022, Delta made $874 million.
As Delta rolls out a new tier of premium lounges at airports in New York, Boston and Los Angeles, the entry requirements are still unknown. But it’s likely that the travelers with the high-end credit cards and those who frequently fly in first or business class will benefit the most.
Photo Credit: A Delta Boeing 737-900ER Delta Air Lines / Delta Air Lines
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