United Airlines CEO Scott Kirby claims he is focused on absolute profitability, not surpassing industry leader Delta Air Lines, even while candidly admitting Delta is the blueprint United has followed in recent years to increase revenue and profitability.

United CEO Scott Kirby: It’s Not About Beating Delta, It’s About Absolute Profitability

Kirby was asked by Jamie Baker, an analyst at Chase, about whether United could overtake Delta in margins in the years ahead during yesterday2025 Q2 earnings call:

“Your primary U.S. competitor has a significant nonunion labor construct. It’s got one of the most efficient hubs in the country. It’s got a sizable MRO. It’s got perhaps the most evolved relationship with its loyalty partner. And to your credit, Scott, I mean, you’ve spoken publicly about holding Delta in high regard. So my question is, what are the catalysts that potentially allow United to overtake Delta margins in coming years? Is it structural? Is it simply brand preference or perhaps you reject the premise that you can have the industry’s highest margins, but I doubt that, that’s going to be your answer.”

Kirby offered a fascinating response, which I want to highlight his full response, then will offer my commentary:

“You know me well, Jamie. I appreciate the question. But what I’d say is I do respect Delta. In fact, on a conceptual level, much of what we’ve been trying to do for the last 15 years at the airlines I’ve been at is win brand loyal customers. And I think they were one of the first airlines maybe the first in the U.S. to really prove that winning brand loyal airlines was the winning formula — winning brand loyal customers was the winning formula for airlines. But my focus is entirely on returning United Airlines to solid double-digit margins and higher absolute margins as opposed to what we do relative to Delta.

“I think we are the only two airlines that have a–we’re the only two brand loyal revenue diverse airlines. I think that is structural. It is permanent. We can talk in more detail about why. It is not copyable by anyone else. And we already generate the bulk of the industry profits. I suspect when you hear earnings results next week, despite the challenges that Delta had last year at CrowdStrike, we have this year, there’s going to be those ups and downs that our margin gap to the 2 of us, our margin gap to the industry is going to continue to expand.

“And I think we’re going to wind up in the same ballpark on margins. You mentioned some of their advantages. We have some advantages as well. Our hubs are better. Atlanta is a great hub, but collectively, our hubs, I think, are better. They’re in bigger cities. We have better international gateways in San Fran, Newark and Dulles in particular. So I think those are going to largely balance out. We’re going to wind up with similar margins. But I’d much rather us have 13% margins and Delta have 13.5% than us have 10% and Delta have 9.5%.

“And everything we’re doing is 100% focused on winning brand loyal customers and creating a great airline that customers are going to choose to fly because that is going to maximize our absolute margins. And this quarter is another — like this first half of the year, it’s remarkable to me, everything that’s happened this year that we’ve grown earnings and margins for the first half of the year. And our guidance is for earnings to be down a little bit this year given everything that has happened.

“But we have a shot at actually growing earnings this year, which would be a truly incredible result and proof point that winning brand loyal customers was the right strategy. We started it a long time ago. You can’t flip it overnight. The 2 of us have the right strategy, and we are going to generate the bulk of the industry profits.”

Kirby’s Focus Is On Profits, Not Surpassing Delta

Kirby may not say it, but of course, he wants to surpass Delta…it would be quite odd if that were not his sentiment or that of any other CEO. But despite his sometimes hyperbolic language about being “biggest” and “best,” I don’t think he’s lying when he says, “I’d much rather us have 13% margins and Delta have 13.5% than us have 10% and Delta have 9.5%.”

It’s telling (but hardly the first time) that Kirby credits United’s blueprint for success to Delta. Indeed, Delta had the vision to strengthen its loyalty relationship with American Express, embrace vertical integration with acquisitions like an oil refinery, strengthen its fortress hubs, and focus on the premium passenger to extract a revenue premium.

Interestingly, Kirby says the bifurcation of Delta and United as profit leaders is “structural” and “permanent,” but I’m not sure I buy that. Does American Airlines have a long uphill battle to catch-up? Absolutely. But is it possible, even in United’s own backyard like Chicago O’Hare? Yes it is…I don’t count AA out. If the last 20 years has taught us anything, it is that nothing is permanent in the airline industry.

CONCLUSION

Scott Kirby says he is less concerned with surpassing Delta than increasing United’s profit margins. I’ll take him at his word, though Kirby’s a competitive fellow and I think he’d love nothing more than to surpass Delta. I think his admission that United won’t surpass Delta is probably correct and that if he did think United could surpass Delta, he would have said so.

But his bigger point that United has found the right formula to maximize profitability is correct. Even with some economic headwinds and unresolved labor issues, United will conitnue to outperform its peers for the foreseeable future. Even so, I would never foreclose the possibility of American Airlines eventually catching up if its new strategic vision moves the carrier in a more premium direction.

image: @scottkirby / Instagram

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