Quote of the Week
"Put simply, our view is that every new restriction elsewhere makes what we already own harder to replicate and more valuable." —Applied Digital CEO Wes Cummins on data center regulations
Should Ed Bastian, Delta Air Lines’ CEO since 2016, be worried about his job?
Elon Musk seems to think so. After Delta chose Amazon’s Leo satellite internet service over SpaceX’s Starlink, Musk predicted that Bastian “will lose his job.” The remark followed unverified reports that Bastian had criticized Musk in conversations with Delta employees. United and American Airlines even joined the fun, trying to lure away Delta customers.
But Bastian says there’s no feud. He brushed off Musk’s remarks during a CNBC appearance Friday. “I drive a Tesla,” he said. He later explained that Delta and Starlink had disagreed about business terms, including access to the customer relationship.
That relationship was also on Bastian’s mind during Delta’s earnings call Friday, when he discussed the threat from AI shopping agents (are they the new Priceline or Expedia?) and why he is reluctant to sell a stake in the airline’s enormously valuable loyalty business.
More on that below, along with PepsiCo’s efforts to revive its North American business and Applied Digital’s plans to build billions of dollars in AI infrastructure.
One thing to notice in these calls is how differently two major American consumer brands are responding to an economy that is strong on paper but that feels tough to many. Delta is seeing high demand from affluent travelers, who have shown little resistance to airfares rising roughly 20% this year. But PepsiCo is working with a different consumer profile, one whose financial pressures have prompted the company to cut snack prices and reconsider its product mix.
The contrast offers a glimpse into how differently American households are experiencing the same economy.
Delta Air Lines (NYSE: DAL)
Q3 FY2026 Earnings Call
Results: Delta reported record adjusted revenue of $17.6 billion, up 16%, and earnings of $1.72 per share, slightly below Wall Street expectations. Pretax profit held steady at $1.5 billion despite a $1.6 billion increase in fuel expenses. The airline lowered its full-year earnings forecast from $6.50–$7.50 per share to $5.10–$5.60, largely because of higher fuel costs. Management nevertheless expects fourth-quarter revenue to grow approximately 20%.
Delta expects higher airfares to stick
When we last covered Delta’s earnings in July, CEO Ed Bastian was arguing that airlines would be able to retain their fare increases even after fuel prices declined. Three months later, he is more confident in that prediction.