Delta Air Lines (DAL) stock plummeted 5.11% in pre-market trading on Thursday following the release of its first-quarter 2025 earnings report, which highlighted challenges in the macro environment and softening demand in key segments. The airline reported pre-tax earnings of $382 million, or $0.46 per share, flat compared to the previous year, on revenue that was 3.3% higher than the prior year.

CEO Ed Bastian noted that February and March reflected a much more challenging macro environment than initially anticipated, with the impact most pronounced in domestic and main cabin segments. In response to these challenges, Delta announced plans to keep its second-half capacity growth flat over last year, with domestic main cabin sales declining as the airline aligns supply with demand. The company also withdrew its full-year outlook due to broad macro uncertainty.

Adding to investor concerns, Delta faces potential headwinds from recently announced tariffs on aircraft imports. Bastian stated firmly that Delta would not pay tariffs on any aircraft deliveries and would defer deliveries if necessary. This stance raises questions about the airline's fleet plans and potential impact on future capacity.

Following the earnings report, several analysts cut their price targets for Delta, including Morgan Stanley lowering its target to $88 from $95, and JP Morgan reducing its target to $66 from $83. These downward revisions likely contributed to the stock's sharp decline as investors reassess Delta's near-term prospects in light of the challenging operating environment.