NEW YORK — Berkshire Hathaway acquired a sizable stake in Delta Air Lines during Greg Abel's first full quarter as chief executive, marking one of his initial independent portfolio decisions since succeeding Warren Buffett.
The investment represents Berkshire's return to the airline sector after Buffett sold the conglomerate's stakes in Delta, United Airlines, Southwest Airlines and American Airlines in spring 2020, citing severe uncertainty facing air travel during the early phase of the pandemic.
Delta has shown robust financial performance recently, reporting strong passenger demand across domestic and international routes. The company's focus on premium travel and loyalty programs has driven higher revenue per available seat mile, exceeding pre-pandemic levels in some segments. Analysts expect continued strength in Delta's cash flows as corporate travel recovers and international routes expand.
The purchase aligns with Abel's known preference for businesses with clear competitive moats and consistent earnings power, echoing Berkshire's foundational investment principles. While the airline industry faces ongoing challenges from fuel price volatility and labor costs, Delta's management has demonstrated effective cost control and capacity discipline.
The move could influence broader market sentiment toward the travel and leisure sectors, with other airline stocks potentially seeing increased investor interest as the market interprets Berkshire's purchase as a vote of confidence in the industry's recovery.
