Warren Buffett spent years telling anyone who would listen that airlines were a terrible business to own. Buffett called them a “capital trap,” a place where fuel costs and fare wars could erase profits almost overnight.Then Covid hit, and Berkshire Hathaway dumped its entire airline portfolio in 2020, locking in steep losses. “The world has changed for airlines,” Buffett said at the time. So it says something that Berkshire (BRK.A) has now done the opposite. The conglomerate has been steadily building a position in Delta Air Lines, and the numbers show real conviction. Berkshire raises stake in Delta Air Lines stockAccording to recent 13F filings, Berkshire’s stake in Delta jumped 44% during the second quarter of 2026, climbing to 57.3 million shares. That position was worth roughly $5.4 billion at the end of June.Back in May, I reported that Berkshire had already built a Delta position worth about $2.6 billion as of the end of March 2026. That earlier purchase came during Greg Abel’s first quarter running Berkshire after taking over as chief executive from Buffett in January.Abel had laid out his approach to shareholders in February. He wrote that Berkshire has “core” positions it will not sell, but outside those, the firm plans to stay disciplined and concentrated. The Delta buy, and the decision to nearly double down on it a quarter later, fits that description closely.Why Delta looks different nowDelta’s numbers help explain the appeal. The airline reported record second-quarter revenue of $17.7 billion, up 14% from a year earlier, even though capacity only grew about 1%. It reported a unit revenue growth of 12.4% in Q2.Pretax profit stood at $1.4 billion, with earnings of $1.56 per share and an operating margin of 9%, all ahead of the guidance Delta gave at the start of the quarter. Return on invested capital stood at 11%, comfortably above the company’s cost of capital.More Airlines:Another airline cancels flights until August, offers some refundsAnother airline will be dissolved, all flights canceledAirline shuts down, all flights grounded after accidentDelta is also less dependent on ticket sales than it used to be. Diverse revenue streams, things like premium seating, loyalty programs, cargo, and maintenance work, made up 61% of total revenue in the quarter. Premium and loyalty revenue each grew nearly 20%. Cargo revenue jumped 39%, and the airline’s third-party maintenance business grew more than 30%.The American Express partnership is a big piece of that shift. Card spending has grown by double digits for seven straight quarters, and Delta expects to collect $9 billion from Amex this year, up 10% from 2025.“Our Delta Amex co-brand card continues to lead the industry, and our recent portfolio enhancements are strengthening the value proposition for both existing and prospective cardholders,” Delta CEO Ed Bastian stated.
Ed Bastian CEO of Delta Air Lines is optimistic on rising premium spending.Bloomberg/Getty Images
Delta’s balance sheet focusDelta’s total shareholders’ equity has climbed steadily, from $15.3 billion at the end of 2024 to $20.9 billion at the end of 2025, and now sits at $21.8 billion.Long-term debt has been moving in the opposite direction, falling from $14 billion at the end of 2024 to $12.5 billion at the end of 2025, and down to $10.5 billion at the end of Q2. Delta ended the June quarter with adjusted net debt of $13.6 billion, down from the start of the year, even as much of the airline industry raised additional capital.Related: Warren Buffett named these 3 stocks as favorites for a reasonDelta expects gross leverage to reach 2x by year-end, moving toward a long-term target of 1x. All three major credit rating agencies still rate Delta at investment grade.Cash generation backs this up. The company produced $8.1 billion in operating cash flow on a trailing basis and $3.4 billion in free cash flow, even after spending $4.7 billion on capital projects like new aircraft and lounges.What this means for Delta stock going forwardDelta is not backing off its outlook, either. The airline is guiding to full-year earnings of $6.50 to $7.50 per share, marking 20% growth from last year, along with $3 billion to $4 billion in free cash flow. Management also pointed to a longer-term goal of mid-teens operating margins and returns on invested capital.Bastian argued on the July earnings call that the industry itself has changed in ways that favor his airline specifically, pointing to reduced discount capacity, higher loyalty spending and diversified revenue as reasons the current momentum should hold, even if fuel prices ease.For Berkshire, which already walked away from airlines once, doubling its Delta stake in a single quarter suggests Abel and his team see something durable here, not just a short-term rebound.Related: Raymond James makes surprising call on Delta Air Lines