Delta's CEO said affluent passengers, 'immune' to geopolitical conflict, are driving sales

• Delta CEO Ed Bastian spoke about the K-shaped economy on a Wednesday earnings call.
• He said premium passengers are less affected by geopolitical conflicts and are traveling as usual.
• Delta reported revenue growth of nearly 10% in the first quarter.

Delta Air Lines CEO said its affluent customers are bringing in cash for the company at a tricky time in the aviation space.

In a Wednesday earnings call, Ed Bastian said that the premium consumer is "becoming more immune to the headlines," and "not delaying their investment in the experience economy."

He said that a year ago, people and corporate passengers specifically were "frozen by the dramatic nature of the tariff uncertainty," but they have grown desensitized to the volatility.

"We hear about tariffs now every day. And sometimes they go up, sometimes they go down. But it's not affecting individuals' lives in a meaningful way," Bastian said.

It's the same story for the Middle East conflict, which has unleashed a massive wave of travel chaos in the region since February and sent fuel prices skyrocketing.

"As difficult as it is to see what's going on with the conflict in the Middle East, I'm not sure that our premium customers are feeling affected by that," the executive added.

Delta reported a 9.4% increase in first-quarter revenue compared to a year ago, earning $14.2 billion. The company's stock rose about 3.7% after earnings were announced on Wednesday.

The airline said that the revenue growth was led by premium, corporate, and loyalty spending. It added that its premium revenue grew 14% compared to the same period last year.

Delta is the latest company to highlight the effects of America's K-shaped economy, a bifurcation in spending patterns between high- and low-earners.

Lower-income consumers are increasingly strapped for cash, and companies are responding with value meals and other deals.

Meanwhile, high-income consumers keep spending. Ralph Lauren's CEO Patrice Louvet told Bloomberg in July that his core consumers were "very resilient."

The CEO of Macy's Inc, which owns the department stores Macy's and Bloomingdale's, said on a December earnings call that the company's customer base, "which is predominantly middle to upper income, remained resilient and engaged."