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Paris Olympics cause revenue decline for two airlines.
Air France-KLM and Delta Air Lines said their units’ revenues were negatively impacted by lower demand for Paris from June to August due to the Olympic Games.
Their comments come as the Summer Olympics are fast approaching. Paris, the city hosting the festivities this time, will host the opening ceremony on July 26.
French soldiers patrol along a street past a road sign indicating the “Paris 2024” route for the upcoming Paris 2024 Olympic Games, in Paris on July 3, 2024. (Julian De Rosa/AFP via Getty Images/Getty Images)
Air France-KLM said on July 1 that its Air France and Transavia brands “are currently facing pressure on expected unit revenues for the summer season due to the upcoming Olympic Games in Paris, with traffic to and from the French capital delayed by other major European cities.”
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The company expects its unit’s revenue-related losses from June to August to range between $174.5 million and $196.3 million (€160 million to €180 million).
An Air France plane lands at Pearson Airport in Toronto, Ontario, Canada, on July 1, 2024. (Photo by Mert Alper Dervis/Anadolu Agency via Getty Images/Getty Images)
The company linked this to international and domestic travelers trying to avoid Paris during the period when the city is hosting the Olympic Games. But once the events are over, demand is expected to return to normal from late August onwards, according to Air France-KLM Group forecasts.
More recently, Delta reported that it also noticed an impact related to the Paris Olympics.
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“We are seeing a $100 million impact on travel to Paris for the Olympics from June through August,” Delta President Glenn Haunstein told analysts and investors Thursday during the company’s second-quarter earnings call. “Excluding this temporary event, summer travel demand to Europe is strong and in line with our expectations.”
“We are seeing a $100 million impact on travel to Paris for the Olympics from June through August,” Delta President Glenn Haunstein told analysts and investors on Thursday. (Nicholas Economou/NourPhoto via Getty Images/Getty Images)
Hauenstein also said the Atlanta-based airline “sees[s] Very strong demand for transatlantic travel after the Olympics in the fall.
Delta said it expects revenue to increase 2% to 4% in the third quarter, an operating margin of 11% to 13% and earnings per share of $1.70 to $2.00, according to company executives.
“We are confident in our full-year outlook of earnings of $6 to $7 per share and free cash flow of $3 to $4 billion with full-year capital investment expected to be $5 billion,” said Dan Janke, the company’s chief financial officer.
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