Delta Air Lines (DAL) 10-K risk factor changes: FY2017 vs FY2016

Despite [removed: significantly heightened] [added: significant] security measures at airports and airlines, the airline industry remains a high profile target for terrorist groups.

We constantly monitor threats from terrorist groups and individuals, including from violent extremists both internationally and domestically, [removed: both] with respect to direct threats against our operations and in ways not directly related to the airline industry.

Security events, [removed: whether] [added: primarily] from external [removed: or internal sources,] [added: sources but] also [added: from potential insider threats, also] pose a significant risk to our [added: passenger and cargo] operations.

These events [removed: can] [added: could] include random acts of violence and [removed: can] [added: could] occur in public areas that we cannot control.

Terrorist attacks, geopolitical conflict or security events, or fear of such events, even if not made directly on or involving the airline industry, could have significant negative impact on us by discouraging passengers from [removed: flying] [added: flying,] leading to decreased ticket sales and increased refunds.

In 2016, our average fuel price per [removed: gallon, including the impact of fuel hedges,] [added: gallon] was $1.49, a 21.6% decrease from our average fuel price in 2015.

Fuel costs represented [removed: 18.3%, 23.0%] [added: 19.2%, 18.3%] and [removed: 35.4%] [added: 23.0%] of our operating expense in [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014,] [added: 2015,] respectively.

We have recently managed our fuel price risk through a hedging program intended to reduce the financial impact from changes in the price of [removed: jet] fuel as [removed: jet] fuel prices are subject to potential volatility.

We [added: may] utilize different contract and commodity types in this program and [removed: frequently] test their economic effectiveness against our financial targets.

[removed: The] [added: Our fuel hedge contracts may contain] margin funding [removed: requirements may] [added: requirements, which] require us to post margin to counterparties or [removed: may] cause counterparties to post margin to us as market prices in the underlying hedged items change.

We expect to continue exploring [removed: similar non-controlling investments in, and entering into joint ventures and strategic alliances with,] [added: ways to expand our relationships with] other carriers as part of our global business strategy.

These investments [added: and relationships] involve significant challenges and risks, including that we may not realize a satisfactory return on our investment, that they may distract management from our operations or that they may not generate the expected revenue synergies.

We [added: also] may be subject to consequences from any improper behavior of joint venture partners, including for failure to comply with anti-corruption laws such as the United States Foreign Corrupt Practices Act.

We are at risk of losses and adverse publicity stemming from a serious accident involving our [removed: aircraft.][added: aircraft or aircraft of our airline partners.]

As of December 31, [removed: 2016,] [added: 2017,] approximately 19% of our workforce, primarily pilots, was unionized.

Extended interruptions or disruptions in service at [removed: one of our hub, gateway or key] [added: major] airports [added: in which we operate] could have a material adverse impact on our operations.

[removed: A significant] [added: An] extended interruption or disruption [removed: in service] at [removed: one of our hubs, gateways or other key airports] [added: an airport where we have significant operations] could have a material impact on our business, financial condition and results of [removed: operations.][added: operation.]

Unauthorized parties may attempt to gain access to our systems or [removed: information] [added: information, including] through fraud or other means of deception.

As a result of these types of [removed: risks,] [added: risks and regular attacks,] we regularly review and update procedures and processes to prevent and protect against unauthorized access to our systems and information and inadvertent misuse of data.

Failure of our technology to perform [removed: reliably] [added: effectively] could have an adverse effect on our business.

For example, we have made and continue to make significant investments in [added: customer facing technology such as] delta.com, mobile device applications, check-in kiosks, customer service applications, airport information displays and related initiatives, including security for these initiatives.

If our technology does not perform [removed: reliably,] [added: effectively,] our business and operations would be negatively affected, which could be material.

An extended disruption in services provided by [removed: our] [added: third parties, including] third-party regional [removed: carriers] [added: carriers,] could have a material adverse effect on our results of operations.

To the extent that a significant disruption in [removed: our regional operations] [added: services] occurs because [removed: any of these providers] [added: third party providers, including regional carriers,] are unable to perform their obligations over an extended period of time, our revenue may be reduced or our expenses may be increased resulting in a material adverse effect on our results of operations.

Market prices for RINs have been volatile, marked by periods of sharp [removed: increases.][added: increases and decreases.]

If we lose senior management [removed: personnel] and other key employees and they are not replaced by individuals with comparable skills, our operating results could be adversely affected.

Competition is [removed: increasing] [added: significant] from government-owned and -funded carriers in the Gulf region, including Emirates, Etihad Airways and Qatar Airways.

We expect to continue incurring [added: significant] expenses to comply with the FAA's regulations.

[removed: Following a referendum in June 2016 in which voters in the] U.K. [removed: approved an exit from the European Union ("EU"), the U.K.] government [removed: is expected to initiate] [added: has initiated] a process to leave the EU (often referred to as Brexit) and [removed: begin] [added: begun] negotiating the terms of the U.K.’s future relationship with the EU.

The airline industry faces substantial uncertainty regarding the impact of the [removed: likely] exit of the U.K. from the EU.

In 2017, our average fuel price per gallon, including the impact of fuel hedges, was $1.68, a 12.8% increase from our average fuel price in 2016.

We are also investing in significant upgrades to technology infrastructure and other supporting systems.

Our reputation and brand could be damaged if we are exposed to significant adverse publicity through social media.

We operate in a highly visible, public environment with significant exposure to social media.

Adverse publicity, whether justified or not, can rapidly spread through social or digital media.

In particular, passengers can use social media to provide feedback about their interaction with us in a manner that can be quickly and broadly disseminated.

To the extent we are unable to respond timely and appropriately to adverse publicity, our brand and reputation may be damaged.

Significant damage to our overall reputation and brand image could have a negative impact on our financial results.

The airline industry is heavily dependent on business models that concentrate operations in major airports in the United States and throughout the world.

While the specific nature of future actions is hard to predict, new environmental laws or regulations adopted in the U.S. or other countries could impose significant additional costs on our operations, either through direct costs in our operations or through increases in costs that our suppliers pass along to us.

Following a referendum in June 2016 in which voters in the U.K. approved an exit from the European Union ("EU"), the

The attacks of September 11, 2001 and the aftermath materially impacted the business, financial condition and operating results of our company, as it did for the rest of the airline industry.

In 2014, our average fuel price per gallon was $3.47, which was significantly higher than fuel prices just a few years earlier.

Our fuel hedge contracts typically contain margin funding requirements.

Our business is heavily dependent on our operations at the Atlanta airport and at our other hub, gateway or key airports, including Amsterdam, Boston, Detroit, London-Heathrow, Los Angeles, Minneapolis-St. Paul, New York-LaGuardia, New York-JFK, Paris-Charles de Gaulle, Salt Lake City, Seattle and Tokyo-Narita.

Each of these operations includes flights that gather and distribute traffic from markets in the geographic region surrounding the hub or gateway to other major cities and to other Delta hubs and gateways.

For example, the European Commission adopted an emissions trading scheme applicable to all flights operating in the European Union, including flights to and from the U.S. While enforcement of the scheme has been deferred until 2017, we expect that this system would impose additional costs on our operations in the European Union if fully implemented.

Other environmental laws or regulations such as this emissions trading scheme or other U.S. or foreign governmental actions may adversely affect our operations and financial results, either through direct costs in our operations or through increases in costs for jet fuel that could result from jet fuel suppliers passing on increased costs that they incur under such a system.

Financial Highlights - [removed: 2016] [added: 2017] Compared to [removed: 2015][added: 2016]

Our pre-tax income for [removed: 2016] [added: 2017] was [removed: $6.6] [added: $5.7] billion, representing a [removed: $521] [added: $935] million decrease compared to the prior year [removed: as lower passenger revenue and] [added: primarily due to] higher [added: fuel costs,] salaries and related costs [added: and depreciation expense, which were partially] offset [removed: the benefits of lower fuel prices.][added: by increased operating revenue.]

Pre-tax income, adjusted for special items (a non-GAAP financial measure) was [removed: $6.1] [added: $5.5] billion, [removed: an increase] [added: a decrease] of [removed: $206] [added: $621] million, or [removed: 3.5%.][added: 10.2%.]

Special items [removed: in 2016] were [added: primarily] related to fuel hedge MTM adjustments and settlements [removed: and Virgin Atlantic MTM adjustments, which totaled] [added: of $259 million in 2017 compared to] $450 million [removed: and $115 million, respectively.][added: in 2016.]

*Operating Expense.* Total operating expense [removed: decreased $215 million] [added: increased $2.4 billion] and our consolidated operating cost per available seat mile ("CASM") [removed: decreased 2.6% to 12.98 cents] [added: increased 6.4%] compared to [removed: 2015,] [added: 2016 to 13.81 cents,] primarily due to [removed: lower fuel prices, partially offset by] higher [added: fuel costs,] salaries and related [removed: costs.][added: costs and depreciation expense.]

[removed: Salaries] [added: *Salaries] and [added: Related Costs.* The increase in salaries and] related costs [removed: were higher as a result of the] [added: was principally due to] pay rate [added: increases given to eligible employees, which includes an 18% pay rate] increase for pilots resulting from a new pilot contract ratified in the December 2016 quarter that was retroactive to January 1, [removed: 2016 and pay rate increases for eligible merit, ground and flight attendant employees effective in the December 2015 quarter.][added: 2016.]

Non-fuel unit costs ("CASM-Ex, including profit sharing" a non-GAAP financial measure) increased [removed: 3.7%] [added: 4.3%] to [removed: 10.13] [added: 10.57] cents due to the pay rate increases [removed: discussed above] and [removed: other product and service investments,] [added: depreciation expense discussed above,] which were partially offset by productivity gains from our fleet, technology and supply chain initiatives.

The non-GAAP financial measures for pre-tax income, adjusted for special items, and CASM-Ex, [removed: used above and adjusted net debt,] [added: including profit sharing, both] used [removed: below,] [added: above,] are defined and reconciled in "Supplemental Information" below.

During [removed: 2016,] the [added: September 2016 quarter, the] U.S. Department of Transportation announced that we [removed: have been] [added: were] awarded two daytime slot pairs at Tokyo's Haneda Airport (from Los Angeles and Minneapolis).

[removed: *Strengthened Balance Sheet*][added: | Balance sheet: | | | | | | | | | | | | | | | | | | | | | | | | | |]

[added: *Capital Returns to Shareholders.*] Since first implementing our quarterly dividend in 2013, we have increased the dividend per share by 50% annually and paid [removed: $1.2] [added: $1.9] billion in total dividends, including [removed: $509] [added: $731] million in [removed: 2016.][added: 2017.]

Through dividends and share repurchases, we have returned [removed: nearly $7.4] [added: $9.8] billion to shareholders since 2013, while reducing outstanding shares by approximately [removed: 14%] [added: 18%] compared to the beginning of 2013.

| | Year Ended December 31, | | | | | | Increase [removed: (Decrease)] | | | % Increase [removed: (Decrease)] | |

| [removed: Total passenger revenue] [added: Passenger] | 33,777 | | | 34,782 | | | (1,005 | | ) | (2.9 | )% |

| Total [removed: operating revenue] | $ | 39,639 | | $ | 40,704 | | $ | (1,065 | ) | (2.6 | )% |

In the Atlantic, the unit revenue decline predominantly resulted from lower yields driven by industry capacity growth [added: outpacing passenger demand and the strength of the U.S. dollar.]

In core European markets, U.S. point-of-sale demand was strong and recovered quickly following the Brussels airport terrorist attack in [removed: March.][added: March 2016.]

However, Europe point-of sale demand [removed: has been] [added: was] soft largely due to the impact of weaker Euro exchange rates.

An Open Skies agreement between the U.S. and Mexico took effect in August 2016 and our application for antitrust immunity with Aeroméxico was approved in the December 2016 quarter, which [removed: should continue] [added: continued] to strengthen our performance in the important Mexican business markets.

| Total [removed: other revenue] | $ | 5,194 | | $ | 5,109 | | $ | 85 | | 1.7 | % |

| (1) | Ancillary businesses and refinery [removed: include] [added: includes] aircraft maintenance and staffing services we provide to third parties, our vacation wholesale operations and refinery sales to third parties. These revenues are not related to the generation of a seat mile. |

| | Year Ended December 31, | | | | | | [removed: (Decrease)] | | | [removed: % (Decrease)] | | [added: | | | | | | | | | | | | | |]

[removed: Beginning with] [added: Prior to that time, the profit sharing program for pilots used this formula but for] 2016 [removed: (to be paid out in 2017),] [added: and] the [added: first nine months of 2017, the] profit sharing program for merit, ground and flight attendant employees [removed: was adjusted to pay] [added: paid] 10% of annual [removed: pre-tax] profit (as defined by the terms of the program) and, if we [removed: exceed] [added: exceeded] our prior-year results, the program [removed: will pay] [added: paid] 20% of the year-over-year increase in [removed: pre-tax] profit to eligible employees.

[removed: For years prior to 2016,] [added: In 2015,] our profit sharing program paid 10% to all eligible employees for the first $2.5 billion of annual profit and 20% of annual profit above $2.5 billion.

The profit sharing program for pilots [removed: remains] [added: remained] unchanged from the prior [removed: year and will continue under its current terms.][added: year.]

Results of Operations - [removed: 2015] [added: 2017] Compared to [removed: 2014][added: 2016]

| | | | | Increase (Decrease) vs. Year Ended December 31, [removed: 2014] [added: 2016] | | | | | | | | | | | | |

| (in millions) | Year Ended December 31, [removed: 2015] [added: 2017] | | | Passenger Revenue | | RPMs (Traffic) | | ASMs (Capacity) | | Passenger Mile Yield | | PRASM | | Load Factor | | |

Passenger revenue [removed: decreased $172 million] [added: increased $1.0 billion] over the prior year.

PRASM [removed: decreased 3.3%] [added: increased 2.1%] and passenger mile yield [removed: decreased 3.7%] [added: increased 0.9%] on [removed: 3.0%] [added: 1.0%] higher capacity.

Load factor was [removed: 0.2 points] [added: 1.0 point] higher than the prior year at [removed: 84.9%.][added: 85.6%.]

Unit revenue declines in the Pacific primarily resulted from [removed: the strength of] [added: industry capacity growth in] the [removed: U.S. dollar and lower international fuel surcharges.][added: region.]

| Administrative fees, club and on-board sales | [removed: 1,261] [added: 1,252] | | | [removed: 1,194] [added: 1,205] | | | [removed: 67] [added: 47] | | | [removed: 5.6] [added: 3.9] | % |

| Aircraft fuel and related taxes | [removed: 6,544 | | | 11,668] [added: (2.66] | | [added: )] | [removed: (5,124] [added: (2.38] | | ) | [removed: (43.9 | )% |]

| Aircraft maintenance materials and outside repairs | [removed: 1,848] [added: 1,992] | | | [removed: 1,828] [added: 1,823] | | | [removed: 20] [added: 169] | | | [removed: 1.1] [added: 9.3] | % |

| Passenger commissions and other selling expenses | [removed: 1,672] [added: 1,787] | | | [removed: 1,700] [added: 1,710] | | | [removed: (28] [added: 77] | | [removed: )] | [removed: (1.6] [added: 4.5] | [removed: )%] [added: %] |

| Landing fees and other rents | [removed: 1,493] [added: 1,528] | | | [removed: 1,442] [added: 1,490] | | | [removed: 51] [added: 38] | | | [removed: 3.5] [added: 2.6] | % |

[removed: *Salaries] [added: | Salaries] and [removed: Related Costs*.][added: related costs | $ | 10,436 | | $ | 10,034 | | $ | 402 | | 4.0 | % |]

*Aircraft Fuel and Related Taxes.* Including our regional carriers, fuel expense [removed: decreased $5.9 billion] [added: increased $771 million] compared to the prior year due to a [removed: 43.5% decrease] [added: 22.3% increase] in the market price per gallon of fuel, [removed: an increase in Monroe's profitability and reduced hedge losses,] partially offset by [removed: a 2.4% increase in consumption.][added: reduced fuel hedge losses compared to the prior year and profits generated within our refinery segment.]

| Aircraft fuel and related taxes(1) | $ | [removed: 6,544] [added: 5,733] | | $ | [removed: 11,668] [added: 5,133] | | $ | [removed: (5,124] [added: 600] | [removed: )] | | |

*Revenue.* Compared to 2016, our operating revenue increased $1.6 billion, or 4.0%, on 1.0% higher capacity combined with robust demand and strong revenue momentum, closing 2017 with three consecutive quarters of year-over-year passenger unit revenue growth.

Passenger revenue per available seat mile ("PRASM") increased 2.1% led by (1) strong domestic leisure yields, (2) expanded distribution of Branded Fares, (3) an improving business fare environment, (4) strength in the Atlantic region leveraged through U.S. point-of-sale traffic gains, along with business cabin traffic and yield growth, and (5) strong performance in the Caribbean, Central America, Brazil and Mexico leisure markets.

Other revenue increased 9.7% partially resulting from growth in our co-brand credit card partnership with American Express.

Including our regional carriers, fuel expense increased $771 million compared to the prior year due to a 22.3% increase in the market price per gallon of fuel, partially offset by reduced fuel hedge losses compared to the prior year and profits generated within our refinery segment.

Salaries and related costs were higher due to increases for eligible merit, ground and flight attendant employees implemented in the June 2017 quarter.

The increase in depreciation expense primarily results from new aircraft deliveries, including B-737-900ER, A321-200, A330-300 and A350-900 aircraft, fleet modifications and accelerated depreciation due to the planned retirement of our MD-88 fleet and two B-767-300ER aircraft.

| Passenger | $ | 34,819 | | $ | 33,777 | | 1,042 | | | 3.1 | % |

| Cargo | 729 | | | 668 | | | 61 | | | 9.1 | % |

| Other | 5,696 | | | 5,194 | | | 502 | | | 9.7 | % |

| Total | $ | 41,244 | | $ | 39,639 | | $ | 1,605 | | 4.0 | % |

| Mainline | $ | 18,878 | | 5.3 | % | 4.1 | % | 3.6 | % | 1.1 | % | 1.7 | % | 0.4 | | pts |

| Regional carriers | 5,714 | | | 0.8 | % | (2.5 | )% | (2.6 | )% | 3.4 | % | 3.4 | % | — | | pts |

| Domestic | 24,592 | | | 4.2 | % | 3.0 | % | 2.5 | % | 1.1 | % | 1.7 | % | 0.4 | | pts |

| Atlantic | 5,292 | | | 2.1 | % | 4.8 | % | 0.3 | % | (2.6 | )% | 1.7 | % | 3.6 | | pts |

| Pacific | 2,366 | | | (9.6 | )% | (9.0 | )% | (7.7 | )% | (0.7 | )% | (2.0 | )% | (1.2 | ) | pts |

| Latin America | 2,569 | | | 8.3 | % | 4.2 | % | 2.0 | % | 4.0 | % | 6.2 | % | 1.8 | | pts |

| Total | $ | 34,819 | | 3.1 | % | 2.2 | % | 1.0 | % | 0.9 | % | 2.1 | % | 1.0 | | pt |

Unit revenues of the domestic region increased 1.7%, resulting from our commercial initiatives, including differentiated products for our customers, known as Branded Fares, and an improving revenue environment.

We continue to differentiate our product offerings and enable customer choice through segmentation, including offering Basic Economy throughout our domestic network.

Our domestic operations closed 2017 with three consecutive quarters of year-over-year unit revenue growth, with robust demand for both business and leisure.

We continue to see improvements in business markets with 81 of the top 100 business markets producing positive yields during the December 2017 quarter, up from 50% from earlier in the year.

Passenger revenues related to our international regions increased 0.5% year-over-year primarily due to strength in the Atlantic and Latin America regions, partially offset by revenue declines in the Pacific.

During 2017, we continued to roll out the expansion of our Branded Fares product throughout the international regions.

The Atlantic region closed 2017 with three consecutive quarters of year-over-year unit revenue growth on strong business class bookings.

We continue to leverage our alliance partners' hub positions in Europe's leading business markets of London, Amsterdam and Paris to increase the volume of U.S. point-of-sale traffic.

The U.K. was particularly robust, with unit revenue growth throughout 2017, including double-digit growth in the second half of 2017.

During the year, we expanded our Basic Economy product to mitigate the impact of ultra-low cost carrier capacity increases.

We continued to optimize the Pacific region with a 7.7% reduction in capacity during 2017, focused on refining the network to generate incremental value from our Chinese and Korean alliances and differentiating our product offerings, including expanding Basic Economy and selling Comfort+ as a separate fare product.

During 2017, we reached an agreement to create a trans-Pacific joint venture with Korean Air, offering an enhanced and expanded network, industry-leading products and service, and a seamless customer experience between the U.S. and Asia.

We also retired our last B-747-400 and introduced our new A350-900 with Delta One suites and the Delta Premium Select cabin on routes from Detroit to Tokyo-Narita and Seoul-Incheon, which are driving improvements in both profitability and customer feedback.

These efforts are beginning to show results as the Pacific returned to positive PRASM growth during the December 2017 quarter for the first time in more than four years.

Unit revenues increased in Latin America principally resulting from unit revenue improvement in Brazil, related to both improved traffic and higher fares.

This improvement was driven by the strengthening of the Brazilian economy and additional connectivity for our customers provided by our relationship with GOL.

Increased leisure traffic to Mexico and the Caribbean, and the incremental value provided by our alliance with Aeroméxico also contributed to the Latin America unit revenue improvement.

Although unit revenue improved in the Caribbean, hurricane damage in several markets during 2017 resulted in temporary service adjustments.

Finally, we continued to differentiate our product offerings, including expanding Basic Economy and selling Comfort+ as a separate fare product in Latin America.

| Loyalty programs | $ | 1,952 | | $ | 1,782 | | $ | 170 | | 9.5 | % |

| Ancillary businesses and refinery | 1,412 | | | 1,129 | | | 283 | | | 25.1 | % |

| Baggage fees | 908 | | | 881 | | | 27 | | | 3.1 | % |

| Other | 172 | | | 197 | | | (25 | | ) | (12.7 | )% |

*Revenue.* Our operating revenue decreased $1.1 billion, or 2.6%, and passenger revenue per available seat mile ("PRASM") decreased 4.9% on 2.1% higher capacity compared to 2015.

The decrease in PRASM was largely driven by competitive pressure in the current low fuel price environment and the impact of U.S. dollar strength on tickets sold in international markets, which are predominantly priced in local currency.

During 2016, Brent crude oil averaged $44 per barrel compared to the average of nearly $52 per barrel during 2015.

Company Initiatives

Our employees are an important part of Delta's success and underpin the quality, customer service and operational reliability that is core to Delta's brand.

During the December 2016 quarter, Delta pilots ratified a new contract that included an 18% pay rate increase that was retroactive to January 1, 2016.

This increase for pilots followed pay rate increases for the majority of other employees during the December 2015 quarter.

In addition, our profit sharing payment to employees in February 2017 will be the third consecutive annual profit sharing payment of more than one billion dollars.

We have paid eligible employees more than $5 billion in profit sharing since the program started in 2007.

We expect to continue to pay our employees industry leading total compensation because sharing the success that our employees help produce is core to Delta's culture and important to providing the best travel experience for our customers and producing solid results for shareholders.

Running a reliable, customer-focused airline has produced a solid return on invested capital ("ROIC", see calculation in "Supplemental Information" below) of 26.1% in 2016, despite the pressure from employee investments discussed above.

This financial performance has allowed us to improve our balance sheet by reducing debt and capital lease obligations to $7.3 billion and adjusted net debt (a non-GAAP financial measure) to $6.1 billion, increase funding of our defined benefit pension plans and increase the amount of capital returned to our shareholders.

We are focused on delivering additional value for shareholders in the future through revenue growth, cost productivity and prudent deployment of cash flows.

Driving Revenue Growth

*Operational Reliability*

A key driver of our revenue growth is higher customer satisfaction resulting from strong operational reliability.

We have significantly invested in our business since 2010 to improve our operational performance, which consistently ranks first among the major U.S. carriers.

During 2016, we operated 241 days with zero mainline canceled flights, a nearly 50% improvement over our 2015 performance.

In addition, our reported completion factor of 99.6% and on-time arrival rate of nearly 87% places us at the top of the major global U.S. carriers.

This operational excellence resulted in consistent increases in our domestic net promoter score, including our highest reported score of 44% in November.

*Global Strategy*

We continue to expand our global network by strengthening our presence in major and developing markets around the world in an effort to increase and diversify our network into high revenue and high growth markets.

The growth of our global presence will enable customers to seamlessly connect to more places while enjoying a consistent, high-quality travel experience.

We are deploying this strategy through investments and relationships in the Atlantic, Latin America and the Pacific.

*Atlantic.* In 2017, we plan to build on our presence in our strategically advantaged hubs in London, Paris and Amsterdam, while de-emphasizing higher Europe point-of-sale markets.

Alongside our 49% equity investment in Virgin Atlantic, we have an antitrust immunized joint venture with the U.K.-based carrier.

This joint venture has significantly improved our presence in London, one of the largest revenue markets from the U.S., while also enhancing our transatlantic network including our existing joint venture relationship with Air France-KLM and Alitalia.

Our Atlantic senior decision-making functions are located in Europe for close coordination with our joint venture airlines.

*Latin America.* We are focused on maximizing the value of our relationships with other carriers in Latin America while deriving value from the recent investments in our network, product and service.

During 2015, we announced our intention to create an antitrust immunized commercial joint venture with Aeroméxico and to acquire additional shares of the capital stock of Grupo Aeroméxico through a cash tender offer, both subject to regulatory approvals.

The Mexican and U.S. regulators approved antitrust immunity for the joint venture during 2016, subject to certain conditions.

Delta and Aeroméxico have accepted the conditions and are in the process of implementing the necessary actions in order to satisfy the conditions.

We expect both the joint venture to be implemented and the tender offer to be completed in the first half of 2017.

As a result of the tender offer, when combined with our current holdings and derivative positions, we would own up to 49% of the outstanding capital stock of Grupo Aeroméxico.

We also own 9.5% of GOL's outstanding capital stock as part of our long-term strategy to strengthen the opportunity we see in Brazil.

In conjunction with our investment, we and GOL have extended our existing commercial agreements.

*Pacific.* We continue to execute the multi-year restructuring of our Pacific operations by reorienting our network from Tokyo-Narita to Shanghai, through our partnership with China Eastern Airlines, and Seoul, through our partnership with Korean Air.

We commenced these routes and canceled other routes in the Pacific region during the December 2016 quarter.

Concurrent with these changes, we are increasing our presence in China, the largest transpacific market from the U.S. We hold a 3.2% stake in China Eastern and are expanding our relationship through co-location in the same terminal at Shanghai’s Pudong airport for a seamless travel experience.

China Eastern is one of the largest airlines in China with a route network covering more than 200 destinations in over 25 countries.

We have market risk exposure related to [removed: aircraft] fuel prices, interest rates and foreign currency exchange rates.

[removed: Aircraft Fuel] [added: Fuel] Price Risk

Changes in [removed: aircraft] fuel prices materially impact our results of operations.

We have recently managed our fuel price risk through a hedging program intended to reduce the financial impact from changes in the price of [removed: jet] fuel as [removed: jet] fuel prices are subject to potential volatility.

At December 31, [removed: 2016,] [added: 2017,] we had [removed: $3.4] [added: $5.3] billion of fixed-rate long-term debt and [removed: $3.7] [added: $3.2] billion of variable-rate long-term debt.

An increase of 100 basis points in average annual interest rates would have decreased the estimated fair value of our fixed-rate long-term debt by [removed: $120] [added: $160] million at December 31, [removed: 2016] [added: 2017] and would have increased the annual interest expense on our variable-rate long-term debt by [removed: $37 million, exclusive of the impact of our interest rate hedge contract.][added: $32 million.]

At December 31, [removed: 2016,] [added: 2017,] we had open foreign currency forward contracts totaling a [removed: $27] [added: $17] million [removed: asset] [added: liability] position.

We estimate that a 10% depreciation or appreciation in the price of the Japanese yen and Canadian dollar in relation to the U.S. dollar would change the projected cash settlement value of our open hedge contracts by a [removed: $45] [added: $34] million gain or [removed: $55] [added: $42] million loss, respectively, for the year ending December 31, [removed: 2017.][added: 2018.]

During the March 2016 quarter, to better participate in the low fuel price environment, we entered into derivatives designed to offset and effectively neutralize our existing airline segment hedge positions.

As a result, we locked in the amount of net hedge settlements for the remainder of 2016 and 2017.

During the June 2016 quarter, we early settled $455 million of our airline segment's 2016 positions.

We recognized $366 million of fuel hedge losses during the year ended December 31, 2016.

For the year ended December 31, 2016, aircraft fuel and related taxes, including our regional carriers, accounted for $6.0 billion, or 18.3%, of our total operating expense, based on annual consumption of approximately four billion gallons of jet fuel.

Assuming we do not enter into new derivative contracts, we are exposed to changes in the market price of jet fuel.

We have one interest rate hedge contract with a notional value of $349 million.

[removed: In general, these] [added: Our alliance] arrangements [added: also] include reciprocal codesharing and [added: reciprocal] frequent flyer program participation and airport lounge access [removed: arrangements and with some carriers may also include joint sales and marketing coordination, co-location of airport facilities and other commercial cooperation] arrangements.

These [removed: alliances] [added: alliance relationships] also may present opportunities in other areas, such as airport ground handling arrangements, aircraft maintenance insourcing and joint procurement.

*Joint Venture Agreements.* We currently operate [removed: three] [added: four] joint ventures with foreign [removed: carriers.][added: carriers and have entered into an agreement to form a fifth.]

[removed: The three] [added: Our commercial] joint ventures are:

| • | A transatlantic joint venture with Air France and KLM, both of which are subsidiaries of the same holding company, and [removed: Alitalia, which generally covers routes between North America and Europe.] [added: Alitalia.] |

| • | A [removed: transatlantic] joint venture with Virgin Atlantic Airways with respect to operations on non-stop routes between the United Kingdom and North America. In addition to the joint venture, we own a non-controlling 49% equity stake in Virgin Atlantic Limited, the parent company of Virgin Atlantic Airways. |

| • | A [removed: transpacific] joint venture with Virgin Australia Airlines and its affiliated carriers with respect to operations on transpacific routes between North America and Australia/New Zealand. |

*Enhanced Commercial Agreements with Foreign Carriers.* We have [removed: separate] [added: a] strategic equity [removed: investments in Grupo Aeroméxico, S.A.B. de C.V., the parent company of Aeroméxico, and] [added: investment] in GOL Linhas Aéreas Inteligentes, S.A., the parent company of [removed: VRG] [added: Gol] Linhas Aéreas [removed: (operating as GOL),] [added: (a Brazilian air carrier),] and an exclusive commercial [added: cooperation] relationship with [removed: each air carrier.][added: GOL, which includes reciprocal codesharing and frequent flyer program participation, airport lounge access arrangements and joint sales cooperation.]

[added: | • | A joint venture with Aeroméxico with respect to trans-border operations on flights between the U.S. and Mexico.] In addition to [removed: our commercial cooperation arrangements for passenger service with] [added: the joint venture, we acquired a non-controlling 49% equity stake in Grupo] Aeroméxico, [added: S.A.B. de C.V., the parent company of Aeroméxico. In addition,] we and Aeroméxico have established a joint venture relating to an airframe maintenance, repair and overhaul operation located in Queretaro, Mexico. [added: |]

We also own shares of China Eastern and entered into a [removed: commercial] [added: joint marketing] agreement with [removed: them during] [added: China Eastern in] 2015 to expand our [removed: relationship] [added: commercial cooperation] and better connect the networks of the two airlines.

Approximately [removed: 17%] [added: 16%] of our passenger revenue in [removed: 2016] [added: 2017] was related to flying by these regional air carriers.

In addition, individuals [removed: and companies] may purchase mileage credits.

We offer last-seat availability for travel awards on our own flights (including [added: most] Delta Connection flights).

In [removed: 2016,] [added: 2017,] program members redeemed more than [removed: 326] [added: 345] billion miles in the SkyMiles program for [removed: 13.4] [added: 14.9] million award redemptions.

*Refinery Operations.* The facility is capable of refining approximately [removed: 195,000] [added: 200,000] barrels of crude oil per day.

Financial information on our segment reporting can be found in Note [removed: 13] [added: 14] of the Notes to the Consolidated Financial Statements.

We have recently managed our fuel price risk through a hedging program intended to reduce the financial impact from changes in the price of [removed: jet] fuel as [removed: jet] fuel prices are subject to potential volatility.

We [added: may] utilize different contract and commodity types in this program and frequently test their economic effectiveness against our financial targets.

Through our global network, our cargo operations are able to connect [removed: all of] the world's major freight gateways.

In [removed: 2016,] [added: 2017,] the total revenue from these businesses was approximately $1 billion.

Our tickets are sold through various distribution channels, including: (1) digital channels, such as delta.com and mobile [removed: applications / web,] [added: applications/web,] (2) telephone reservations, (3) online travel agencies and (4) traditional "brick and mortar" and other agencies.

We have transformed distribution to a more retail [removed: oriented] [added: oriented,] merchandised approach by introducing well-defined and differentiated products for our customers.

Delta OneTM, Delta Premium Select, First Class and Delta Comfort+TM include [added: varying] premium amenities and services while Main Cabin and Basic Economy allow varying levels of pre-travel flexibility as well as exceptional service once onboard the aircraft.

The industry [removed: is transforming] [added: has evolved] through [removed: consolidation,] [added: mergers and new entry,] both domestically and internationally, and changes in international alliances.

Consolidation in the airline industry, the rise of well-funded government sponsored international carriers, changes in international alliances and the creation of immunized joint ventures have altered, and will continue to alter, the competitive landscape in the industry, resulting in the formation of airlines and alliances with increased financial resources, more extensive global networks and [added: more] competitive cost structures.

These carriers have large numbers of international widebody aircraft on order and are increasing service to the U.S. [removed: Several of these carriers, along with] [added: These] carriers [removed: from China, India and Southeast Asia,] are government-subsidized, which has allowed them to grow quickly, reinvest in their product and expand their global presence at the expense of U.S. airlines.

In particular, alliances formed by domestic and foreign carriers, including SkyTeam, the Star Alliance (among United Airlines, Lufthansa German Airlines, Air Canada and others) and the oneworld alliance (among American Airlines, British Airways, Qantas and others) have [removed: altered] [added: enhanced] competition in international markets.

The DOT also has authority to review certain joint venture agreements between [removed: major] [added: domestic and international] carriers and engages in regulation of economic matters such as slot transactions.

The new aircraft certification standards [added: will] apply to [removed: virtually all types of] [added: new] aircraft [removed: that make up the global commercial fleet and will be phased] [added: types] in [removed: between] 2020 and [added: to new in-production aircraft starting in 2023 but no later than] 2028.

The EPA has historically implemented air emissions control standards adopted by ICAO; therefore, the ICAO [added: aircraft] engine certification standards are expected to influence the development of any EPA greenhouse gas emission standards for aircraft.

We seek to minimize the impact of greenhouse gas emissions from our operations through reductions in our fuel consumption and other [removed: efforts] [added: efforts,] and have realized reductions in our greenhouse gas emission levels since 2005.

We have agreed to make available under the CRAF Program a portion of our international aircraft during the contract period ending September 30, [removed: 2017.][added: 2018.]

As of December 31, [removed: 2016,] [added: 2017,] we had approximately [removed: 84,000] [added: 87,000] full-time equivalent employees, approximately 19% of whom were represented by unions.

| Delta Pilots | [removed: 12,863] [added: 13,234] | | | ALPA | December 31, 2019 |

| Delta Flight Superintendents (Dispatchers) | [removed: 415] [added: 420] | | | PAFCA | March 31, 2018 |

| Endeavor Air Pilots | [removed: 1,527] [added: 1,805] | | | ALPA | January 1, [removed: 2020] [added: 2024] |

| Endeavor Air Flight Attendants | [removed: 1,132] [added: 1,160] | | | AFA | December 31, 2018 |

| Endeavor Air Dispatchers | [removed: 47] [added: 55] | | | PAFCA | December 31, 2018 |

In addition, [removed: 199] [added: 192] refinery employees of Monroe are represented by the United Steel Workers under an agreement that expires on February 28, 2019.

Bastian, Age [removed: 59:] [added: 60:] Chief Executive Officer of Delta since May 2016; President of Delta (September 2007 - May 2016); President of Delta and Chief Executive Officer Northwest Airlines, Inc. (October 2008 - December 2009); President and Chief Financial Officer of Delta (September 2007 - October 2008); Executive Vice President and Chief Financial Officer of Delta (July 2005 - September 2007); Chief Financial [removed: Officer,] [added: Officer of] Acuity Brands (June 2005 - July 2005); Senior Vice [removed: President-Finance] [added: President - Finance] and Controller of Delta (2000 - April 2005); Vice President and Controller of Delta (1998 - 2000).

The most significant of these arrangements are commercial joint ventures that include joint sales and marketing coordination, co-location of airport facilities and other commercial cooperation arrangements.

| • | In 2017, we entered into a joint venture with Korean Air Lines with respect to operations on transpacific routes between the United States and certain countries in Asia. We have not yet implemented this joint venture as it remains subject to receipt of required regulatory approvals in Korea. |

| 2017 | 4,032 | | $ | 6,756 | | $ | 1.68 | | 19.2 | % |

In addition, we enter into derivatives with third parties to hedge financial risk related to Monroe’s refining margins.

| | |

| --- | --- |

| | |

| --- | --- |

Technology Transformation

Significant progress was made in 2017 in the transformation of our information technology function to improve operational reliability and enhance disaster recovery capabilities.

Most significantly, we opened a new data center to provide redundancy for our key systems and continue the enhancement of that facility.

We also reduced the risk of technology system failures to our operations through additional disaster recovery processes and heightened emphasis on our information security program including through the hiring of an experienced information security professional as our Chief Information Security Officer.

We are engaged in a digital transformation by continuing to invest in technology that supports our operations and provides tools for our employees, with our long term goal to convert our technology into a competitive advantage.

These investments include improvements to infrastructure and technology architecture to unify and improve access to data sources and continue innovations in customer facing applications.

This digital transformation will enhance interactions with our customers and allow us to deliver more personalized service, further enhancing the customer experience and strengthening our brand and competitive position.

In 2017, the EU extended the exemption for foreign flights through 2023 given the International Civil Aviation Organization’s ("ICAO") adoption of a global market-based program.

It is important to note that the standards will not apply to existing in-service aircraft.

However, exemption from the certification requirement would provide no protection from taxation schemes based on CO2 emissions.

Rahul Samant, Age 51: Executive Vice President - Chief Information Officer of Delta since January 2018; Senior Vice President and Chief Information Officer of Delta (February 2016 - December 2017); Senior Vice President and Chief Digital Officer of American International Group, Inc. (January 2015 - February 2016); Senior Vice President and Global Head, Application Development and Management of American International Group, Inc. (September 2012 - December 2014); Managing Director of Bank of America (1999 - September 2012).

We invested in Aeroméxico and GOL because they operate in Latin America's two largest markets, Mexico and Brazil, respectively.

Our commercial agreements with each of these carriers separately provide for expansion of reciprocal codesharing and frequent flyer program participation, airport lounge access arrangements, improved passenger connections and joint sales cooperation.

We intend to further expand our relationship with Aeroméxico through a joint venture on flights between the U.S. and Mexico that will allow us to compete more effectively on these routes.

We have received conditional approvals from governmental authorities for this joint venture and plan to implement it in the first half of 2017.

We have commenced a tender offer for additional capital stock of Grupo Aeroméxico (the parent company of Aeroméxico) that would result in us owning up to 49% of the outstanding shares.

The expanded commercial agreement is designed to allow the carriers to compete more effectively on routes between the U.S. and China, provide more travel options for customers in both countries and make joint investments in the customer experience.

| 2014 | 3,893 | | $ | 13,512 | | $ | 3.47 | | 35.4 | % |

As a result, we operated a limited number of flights subject to the ETS through 2016.

Unless the EU amends the current legislation following the 2016 Assembly of the International Civil Aviation Organization ("ICAO"), the ETS will apply to all flights originating or landing in the European Union beginning in 2017.

Separately, the U.S. has pledged to reduce greenhouse gas emissions by 26-28% from 2005 levels by 2025.

The U.S. has made this pledge in connection with the 2015 United Nations Framework Convention on Climate Change reached in Paris by over 190 countries, which the U.S. and China formally ratified in September 2016.

The U.S. has proposed a number of domestic greenhouse gas regulations to help achieve this goal.

On March 29, 2017, the District Court granted the defendants’ motions for summary judgment.

The plaintiffs have filed an appeal to the U.S. Court of Appeals, and that appeal remains pending.

In addition, the defendants have filed motions for summary judgment, which also remain pending.

Delta believes the claims in these cases are without merit and is vigorously defending these lawsuits.

For the fiscal year ended December 31, [removed: 2016][added: 2017]

[removed: ][added: ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [added: o]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, [removed: or] a smaller reporting [added: company or an emerging growth] company.

See the definitions of “large accelerated filer,” “accelerated [removed: filer” and] [added: filer,”] “smaller reporting company” [added: and "emerging growth company"] in Rule 12b-2 of the Exchange Act.

| Large accelerated filer | þ | Accelerated filer | o | Non-accelerated filer | o | [removed: Smaller] [added: (Do not check if a smaller] reporting [removed: company | o] [added: company)] |

| [removed: (Do not check if a smaller] [added: Smaller] reporting [removed: company) |] [added: company] | | | [added: o] | [added: Emerging growth company] | [added: o] | |

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant as of June 30, [removed: 2016] [added: 2017] was approximately [removed: $27.3] [added: $38.9] billion.

On January 31, [removed: 2017,] [added: 2018,] there were outstanding [removed: 730,770,638] [added: 706,913,358] shares of the registrant's common stock.

| [Forward-Looking [removed: Statements](#sFA4BAC4F3B265C8C961828C50B0727EF)] [added: Statements](#s9C660AB1B5E751EFBFF1397E87FD0791)] | [removed: [1](#sFA4BAC4F3B265C8C961828C50B0727EF)] [added: [1](#s9C660AB1B5E751EFBFF1397E87FD0791)] |

| [ITEM 1. [removed: BUSINESS](#s2EE35C2228085FC9BD433CC007810289)] [added: BUSINESS](#s66A82B80860656B8820C39C9C17CA57E)] | [removed: [2](#s2EE35C2228085FC9BD433CC007810289)] [added: [2](#s66A82B80860656B8820C39C9C17CA57E)] |

| [Frequent Flyer [removed: Program](#s55F3DD147D2D5DA6916F16A55B45D630)] [added: Program](#s6DDA41D5C59F5AA19DF244660885F7CF)] | [removed: [4](#s8F28A828548354C6B355DB2062A99413)] [added: [4](#s0F572D4042A452F7A6ACBB03932DDE89)] |

| [Other [removed: Businesses](#s232F68CC65D65DA0B14DFEFD3495B20A)] [added: Businesses](#s45A27AE74C145033A35B297B4A81B103)] | [removed: [5](#s232F68CC65D65DA0B14DFEFD3495B20A)] [added: [5](#s45A27AE74C145033A35B297B4A81B103)] |

| [Distribution and Expanded Product [removed: Offerings](#sE9E2462C0AF65DAC82221641D2369600)] [added: Offerings](#sB27BE734F75D5A979BB059BD51B4FF75)] | [removed: [5](#sE9E2462C0AF65DAC82221641D2369600)] [added: [5](#sB27BE734F75D5A979BB059BD51B4FF75)] |

| [Regulatory [removed: Matters](#s113BF9BF5AC95FD29B69DE7B2A23C867)] [added: Matters](#sC782BE645A155DA8B2EE353C79AE7BC1)] | [removed: [6](#s113BF9BF5AC95FD29B69DE7B2A23C867)] [added: [7](#sC782BE645A155DA8B2EE353C79AE7BC1)] |

| [Employee [removed: Matters](#s654F13F5B7E1573AA1C96E6A352A3ACF)] [added: Matters](#sBD975A0863655B52B28C9FA5B61AE7B0)] | [removed: [10](#s654F13F5B7E1573AA1C96E6A352A3ACF)] [added: [10](#sBD975A0863655B52B28C9FA5B61AE7B0)] |

| [Executive Officers of the [removed: Registrant](#sBDB10D0649E257C690CBC468824DDBDA)] [added: Registrant](#s0B106DB2E6B55E3CB3B43CC2376BBBAC)] | [removed: [11](#sBDB10D0649E257C690CBC468824DDBDA)] [added: [11](#s0B106DB2E6B55E3CB3B43CC2376BBBAC)] |

| [Additional [removed: Information](#sB27AB44D424B52B586F86E0F5EF17FEA)] [added: Information](#s7B7DE818733F58DA96F9608A56039F14)] | [removed: [11](#sB27AB44D424B52B586F86E0F5EF17FEA)] [added: [11](#s7B7DE818733F58DA96F9608A56039F14)] |

| [ITEM 1A. RISK [removed: FACTORS](#s6787F88C53F85D2782333CBB40B63390)] [added: FACTORS](#s32E7B8D7CFCC5890893B5F4F82775D13)] | [removed: [12](#s6787F88C53F85D2782333CBB40B63390)] [added: [12](#s32E7B8D7CFCC5890893B5F4F82775D13)] |

| [Risk Factors Relating to [removed: Delta](#sDBF73144806D5AE797589FA0E9E6F5E6)] [added: Delta](#sFD6951C588F6530E8ECBDECBC6A23377)] | [removed: [12](#sDBF73144806D5AE797589FA0E9E6F5E6)] [added: [12](#sFD6951C588F6530E8ECBDECBC6A23377)] |

| [Risk Factors Relating to the Airline [removed: Industry](#sB525701520245360851DCE05188E2EC8)] [added: Industry](#sBF4C8C65F2BB55C7851B35F3865E141F)] | [removed: [17](#sB525701520245360851DCE05188E2EC8)] [added: [17](#sBF4C8C65F2BB55C7851B35F3865E141F)] |

| [ITEM 1B. UNRESOLVED STAFF [removed: COMMENTS](#s9EC679C1DEA258D8AAB8BC3976C4AAEB)] [added: COMMENTS](#s77E66D98E4845619A2CD8FB441C2CFA6)] | [removed: [19](#s9EC679C1DEA258D8AAB8BC3976C4AAEB)] [added: [19](#s77E66D98E4845619A2CD8FB441C2CFA6)] |

| [ITEM 2. [removed: PROPERTIES](#s5B3CBD44046D5506A9331EC52FDD4CC7)] [added: PROPERTIES](#s0AD7CB6FEB815783A9E8B28434C131CF)] | [removed: [20](#s5B3CBD44046D5506A9331EC52FDD4CC7)] [added: [20](#s0AD7CB6FEB815783A9E8B28434C131CF)] |

| [Flight [removed: Equipment](#s3E9F4ED6A6D55A369963A8B0984A76A0)] [added: Equipment](#sC1C036F535B35588AC93BF9E6D1C0E76)] | [removed: [20](#s3E9F4ED6A6D55A369963A8B0984A76A0)] [added: [20](#sC1C036F535B35588AC93BF9E6D1C0E76)] |

| [Ground [removed: Facilities](#s697DB36DE88D5B3D8DA88693B7596F08)] [added: Facilities](#sE2C1257B409C52ECB22BCAF98ED22CDB)] | [removed: [21](#s697DB36DE88D5B3D8DA88693B7596F08)] [added: [21](#sE2C1257B409C52ECB22BCAF98ED22CDB)] |

| [ITEM 3. LEGAL [removed: PROCEEDINGS](#sF88743566BF55F9FBB9405B797EEBCD9)] [added: PROCEEDINGS](#sCF7D4DC11BAA544D8D73ED9D1939B71B)] | [removed: [22](#sF88743566BF55F9FBB9405B797EEBCD9)] [added: [22](#sCF7D4DC11BAA544D8D73ED9D1939B71B)] |

| [ITEM 4. MINE SAFETY [removed: DISCLOSURES](#s62B94E96E81C5CB99F9BB63C3B2C5B8A)] [added: DISCLOSURES](#sEB1EEDF4445A5AE381FABA2ACB432666)] | [removed: [22](#s62B94E96E81C5CB99F9BB63C3B2C5B8A)] [added: [22](#sEB1EEDF4445A5AE381FABA2ACB432666)] |

| [ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED [removed: STOCKHOLDER](#s2E82E3683A7E58BE849616BCD313EA3E)] [added: STOCKHOLDER](#s699C4BCD54D2582DB52C9CF0568753E8)] [MATTERS AND ISSUER PURCHASES OF EQUITY [removed: SECURITIES](#s2E82E3683A7E58BE849616BCD313EA3E)] [added: SECURITIES](#s699C4BCD54D2582DB52C9CF0568753E8)] | [removed: [23](#s2E82E3683A7E58BE849616BCD313EA3E)] [added: [23](#s699C4BCD54D2582DB52C9CF0568753E8)] |

| [ITEM 6. SELECTED FINANCIAL [removed: DATA](#sF5585FEC14965063BEA48C8E890C5F46)] [added: DATA](#sCCB479AEF0535114A10D6CA240A00EC1)] | [removed: [25](#sF5585FEC14965063BEA48C8E890C5F46)] [added: [25](#sCCB479AEF0535114A10D6CA240A00EC1)] |

| [ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION [removed: AND](#s1B9C62E23ACA5D05AEFB713F45C71CC9)] [added: AND](#s2F0D246DA9B45245A4DC549A76EE901F)] [RESULTS OF [removed: OPERATION](#s1B9C62E23ACA5D05AEFB713F45C71CC9)S] [added: OPERATION](#s2F0D246DA9B45245A4DC549A76EE901F)S] | [removed: [27](#s1B9C62E23ACA5D05AEFB713F45C71CC9)] [added: [27](#s2F0D246DA9B45245A4DC549A76EE901F)] |

| [Results of Operations - [removed: 201](#sEB559F0FEAE55A629914DE82921F468D)6] [added: 2016] Compared to [removed: 2015] [added: 2015](#sB8E583D6BDD554A6A4539E013BB18847)] | [removed: [30](#sEB559F0FEAE55A629914DE82921F468D)] [added: [32](#sB8E583D6BDD554A6A4539E013BB18847)] |

| [Non-Operating [removed: Results](#s9EEE38AA4935585193094D79B0321255)] [added: Results](#s0A09F0A81F045F95B8DF4D8A7BAA539A)] | [removed: [36](#s9EEE38AA4935585193094D79B0321255)] [added: [35](#s0A09F0A81F045F95B8DF4D8A7BAA539A)] |

| [Income [removed: Taxes](#s47191B6A8B6052CB81FDF8F59A99F09A)] [added: Taxes](#s17BD50889F5A5E6186EB54DD64F35FF5)] | [removed: [36](#s47191B6A8B6052CB81FDF8F59A99F09A)] [added: [35](#s17BD50889F5A5E6186EB54DD64F35FF5)] |

| [Refinery [removed: Segment](#s366F5633F040574DA0944886F1EFD3A9)] [added: Segment](#sE0CFF62740FC52E8886BC44A8733F418)] | [removed: [36](#s366F5633F040574DA0944886F1EFD3A9)] [added: [35](#sE0CFF62740FC52E8886BC44A8733F418)] |

| [Financial Condition and [removed: Liquidity](#s3AE93693E35C5FCEB4516DA665F76F51)] [added: Liquidity](#s6CCF7426EEE855BB8678A6A4CBE8E43E)] | [removed: [37](#s3AE93693E35C5FCEB4516DA665F76F51)] [added: [36](#s6CCF7426EEE855BB8678A6A4CBE8E43E)] |

| [Contractual [removed: Obligations](#s933EC07DD9DB5EF287D24F3E6D69BB27)] [added: Obligations](#s941FC03B31535E0DA3F5818655FB4084)] | [removed: [41](#s933EC07DD9DB5EF287D24F3E6D69BB27)] [added: [39](#s941FC03B31535E0DA3F5818655FB4084)] |

| [Critical Accounting Policies and [removed: Estimates](#sA62F9539DAE75B47A71DFDEF8ADB8FA7)] [added: Estimates](#s7BFF24C2C6EB53D5ABAAC317CEEB0BC0)] | [removed: [42](#sA62F9539DAE75B47A71DFDEF8ADB8FA7)] [added: [40](#s7BFF24C2C6EB53D5ABAAC317CEEB0BC0)] |

| [Supplemental [removed: Information](#s77811AC8BC78562999D2C5554CC26B1D)] [added: Information](#s4D59E3F454AD51738E180B190836FD4B)] | [removed: [47](#s77811AC8BC78562999D2C5554CC26B1D)] [added: [45](#s4D59E3F454AD51738E180B190836FD4B)] |

| [Glossary of Defined [removed: Terms](#sB8A55C9667FE51068880921D804870D4)] [added: Terms](#s65F846AB63565CF5A23E38097EDB2A73)] | [removed: [50](#sB8A55C9667FE51068880921D804870D4)] [added: [46](#s65F846AB63565CF5A23E38097EDB2A73)] |

| [ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET [removed: RISK](#s3A1827910B0D5E03B86002B1823451F2)] [added: RISK](#sEBBFC6FC966D57FE92763ED11BEB7DF0)] | [removed: [51](#s3A1827910B0D5E03B86002B1823451F2)] [added: [47](#sEBBFC6FC966D57FE92763ED11BEB7DF0)] |

| | | | | | | |

| --- | --- | --- | --- | --- | --- | --- |

| | | | | | | |

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.


A LETTER FROM OUR CEO TO OUR SHAREHOLDERS

Dear Delta shareholder:

Delta Air Lines had a strong year on many fronts in 2017, delivering solid results for our employees, customers and owners, while also making significant investments in Delta’s future.

We generated more than $5 billion in pre-tax income for the third consecutive year despite a number of challenges, including major weather events and a 12-hour power outage at our Atlanta hub.

Through it all, Delta people provided our customers the very best service in the industry - showing that they are our greatest asset.

Our top financial priority in 2017 was to return the business to unit revenue growth.

We took a number of actions to drive this result, including capping our capacity growth at 1% for the year.

We also made investments in our product and people that are contributing to higher net promoter scores, demonstrating better customer satisfaction and a sustainable revenue premium.

We enter 2018 with the best revenue momentum in years.

Domestic demand and yields remain robust and global economies are rebounding, allowing us to resume growth in our international business.

Limiting our capacity growth helped produce revenue momentum, but it also created heightened pressure on our unit costs.

Costs were further pressured by product investments, weather and accelerated depreciation on aircraft exiting our fleet.

These impacts combined for unsustainable unit cost growth in 2017, and we are determined to change this trajectory in 2018.

Our 2018 fleet additions are set to deliver some of the greatest efficiency gains in Delta’s history.

In addition, we have started a company-wide project to drive productivity by better leveraging our scale and rethinking the way we do business.

In recent years, we have invested more than $2 billion in partnerships with some of the finest airlines in the world.

These strong relationships allow us to offer more choices to our customers and expand globally in a more capital efficient way.

In 2017 alone, we acquired a 10% stake in Air France-KLM, acquired a 49% stake in Grupo Aeroméxico and announced plans for joint ventures with Korean Air and WestJet.

With these investments made, we have built the foundation to produce hundreds of millions of dollars in benefits in the coming years from serving some of the largest and fastest growing markets in the world.

As we look to 2018 and beyond, our focus is on delivering sustainable financial results by leveraging our five key competitive differentiators:

Our People and Culture - Our culture is the foundation of every decision we make at Delta and the key to every other competitive advantage that we have built.

Ensuring that the incentives of our people are aligned with those of our customers and shareholders is vital to our success, which is why we are proud to offer our people one of the most generous profit-sharing programs of any company.

Since we started our profit sharing program in 2007, it has paid out more than $6 billion, including at least $1 billion for each of the past four years.

Our culture is also one of giving back to the communities we serve - in 2017 we contributed over $40 million as part of our annual commitment to give 1 percent of net income to key charitable organizations.

Our Industry-Leading Operational Reliability - We are constantly focused on ways to run a better, more reliable, customer-focused airline.

We have made significant investments in our business and currently run the best operation in the global industry - in 2017 we ran 242 days without cancelling any mainline flights, including 90 days with no system cancellations on the entire Delta platform - a 10% increase from 2016.

These results led to Delta’s recognition by *FlightGlobal* as the most on-time global airline - the first time a U.S. airline has earned this award.

Our Network - Our domestic network combines a focus on the most desirable markets with a balanced footprint between East and West coasts, and is optimally structured to capture premium revenue.

Delta holds approximately 60% share in our four interior hubs (Atlanta, Minneapolis, Detroit and Salt Lake City), allowing us to take advantage of scale economies.

We have also streamlined our international network with a focus on major and developing markets around the world through global partnerships.

We are achieving many of the benefits of cross-border cooperation for our customers and our owners, with strong alliances in Europe, Latin America, Asia, Australia and Canada.

Our Customer Loyalty and Brand - During 2017, we achieved record customer satisfaction levels, with higher net promoter scores in every region and a 2-point improvement overall, including an all-time high in November 2017.

We will continue to build on this success, with more than $12 billion of airport facility projects planned in the next decade.

We are offering more customer choice through Branded Fares, including First Class upsell, Comfort+, Preferred Seats and Basic Economy, which combined generated nearly $2 billion of revenue in 2017.

We are also growing our relationship with American Express - our co-brand partnership contributed $3 billion in 2017, which we expect to grow to $4 billion by 2021.

| | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- |

| [General](#s119116206EFC5579A16DB171EA4A9C00) | [2](#s119116206EFC5579A16DB171EA4A9C00) |

| [Fuel](#s8F28A828548354C6B355DB2062A99413) | [4](#s55F3DD147D2D5DA6916F16A55B45D630) |

| [Competition](#sE302377F69F05E7D85F8C3E33D973A9A) | [6](#sE302377F69F05E7D85F8C3E33D973A9A) |

| [Financial Highlights - 201](#sF8A955A260E05437AA4127725B6CF564)6 Compared to 2015 | [27](#sF8A955A260E05437AA4127725B6CF564) |

| [Company Initiatives](#sF8A955A260E05437AA4127725B6CF564) | [27](#sF8A955A260E05437AA4127725B6CF564) |

| [Results of Operations - 20](#s33F014C345F95FD4AD2488B83F1BEC77)15 Compared to 2014 | [33](#s33F014C345F95FD4AD2488B83F1BEC77) |

| [SIGNATURES](#s9D55036727575479B2C51D3584495669) | [98](#s9D55036727575479B2C51D3584495669) |

| [EXHIBIT INDEX](#s78ABA65E15BC595497F10AD8B293BA0A) | [100](#s78ABA65E15BC595497F10AD8B293BA0A) |

Our operating aircraft fleet, commitments and options at December 31, [removed: 2016] [added: 2017] are summarized in the following table:

| B-717-200 | 3 | 13 | 75 | 91 | [removed: 15.3] [added: 16.3] | — | — | — |

| B-737-700 | 10 | — | — | 10 | [removed: 7.9] [added: 8.9] | — | — | — |

| B-737-800 | 73 | [removed: —] [added: 4] | — | [removed: 73] [added: 77] | [removed: 15.9] [added: 16.3] | — | [removed: 4] [added: —] | — |

| B-737-900ER | [removed: 41 | — | 28 | 69 | 1.8] [added: 23] | [removed: 51] [added: 18] | — | — | [added: 41 |]

| B-757-300 | 16 | — | — | 16 | [removed: 13.8] [added: 14.9] | — | — | — |

| B-767-300 | [removed: 6] [added: 2] | — | — | [removed: 6] [added: 2] | [removed: 23.4] [added: 24.5] | — | — | — |

| B-767-300ER | [removed: 54] [added: 55] | [removed: 4] [added: 2] | — | [removed: 58] [added: 57] | [removed: 20.8] [added: 21.7] | — | — | — |

| B-767-400ER | 21 | — | — | 21 | [removed: 15.8] [added: 17.0] | — | — | — |

| B-777-200ER | 8 | — | — | 8 | [removed: 16.9] [added: 18.1] | — | — | — |

| B-777-200LR | 10 | — | — | 10 | [removed: 7.8] [added: 8.8] | — | — | — |

| A319-100 | 55 | — | 2 | 57 | [removed: 14.9] [added: 15.8] | — | — | — |

| A320-200 | [removed: 58] [added: 55] | [removed: 4] [added: 3] | [removed: 7] [added: 4] | [removed: 69] [added: 62] | [removed: 21.8] [added: 22.4] | — | — | — |

| A321-200 | [removed: 7 | — | 8 | 15] [added: 31] | [removed: 0.4] [added: 32] | [removed: 67] [added: 27] | [removed: —] [added: 3] | [removed: —] [added: 93] |

| A330-200 | 11 | — | — | 11 | [removed: 11.8] [added: 12.8] | — | — | — |

| A330-300 | [removed: 26] [added: 28] | — | 3 | [removed: 29] [added: 31] | [removed: 8.5] [added: 9.0] | [removed: 2] [added: —] | — | — |

| A350-900 | [removed: — | — | — | —] [added: 5] | [removed: —] [added: 2] | [removed: 25] [added: 2] | [removed: —] [added: 10] | [removed: —] [added: 19] |

| [removed: CS100(2)] [added: CS100] | — | — | — | — | — | 75 | — | 50 |

| (1) | Excludes certain aircraft we own or [removed: lease, which] [added: lease that] are operated by regional carriers on our behalf shown in the table below. |

The following table summarizes the aircraft fleet operated by our regional carriers on our behalf at December 31, [removed: 2016:][added: 2017:]

| Endeavor Air, Inc.(1) | [removed: 53] [added: 50] | — | [removed: 81] [added: 93] | — | — | [removed: 134] [added: 143] |

| ExpressJet Airlines, [removed: Inc.] [added: Inc.(2)] | [removed: 36] [added: —] | [removed: 35] [added: 33] | [removed: 28] [added: 16] | — | — | [removed: 99] [added: 49] |

| SkyWest Airlines, Inc. | [removed: 60] [added: 86] | 27 | 36 | — | [removed: 12] [added: 18] | [removed: 135] [added: 167] |

| Compass Airlines, LLC | — | — | — | [removed: 6] [added: —] | 36 | [removed: 42] [added: 36] |

Our purchase commitments for additional aircraft at December 31, [removed: 2016] [added: 2017] are detailed in the following table:

| Aircraft Purchase Commitments | [removed: 2017 |] 2018 | 2019 | [added: 2020 |] After [removed: 2019] [added: 2020] | Total |

| B-737-900ER | [removed: 20] [added: 52] | [removed: 18] [added: —] | [removed: 13] [added: 37] | [added: 89 | 2.3 | 41 |] — | [removed: 51] [added: —] |

| A321-200 | [removed: 17] [added: 14] | [removed: 23] [added: —] | [removed: 27] [added: 20] | [added: 34 | 0.8 | 93 |] — | [removed: 67] [added: —] |

| A350-900 | [removed: 5] [added: 6] | [added: — | — |] 6 | [removed: 7] [added: 0.2] | [removed: 7] [added: 19] | [removed: 25] [added: —] | [added: — |]

| CS100 | [removed: — |] 15 | 25 | [removed: 35] [added: 16] | [added: 19 |] 75 |

| B-757-200 | 88 | 9 | 3 | 100 | 20.4 | — | — | — |

| A321-200neo | — | — | — | — | — | 100 | — | 100 |

| MD-88 | 92 | 17 | — | 109 | 27.5 | — | — | — |

| MD-90 | 65 | — | — | 65 | 20.9 | — | — | — |

| Total | 664 | 48 | 144 | 856 | 16.7 | 353 | — | 150 |

| Republic Airline, Inc. | — | — | — | 20 | 16 | 36 |

| Total | 136 | 82 | 152 | 20 | 70 | 460 |

| (2) | During 2017, we and ExpressJet Airlines, Inc. agreed to early terminate our relationship by the end of 2018. |

| A321-200neo | — | — | 16 | 84 | 100 |

| Total | 74 | 77 | 65 | 137 | 353 |

| B-747-400 | 3 | 4 | — | 7 | 25.4 | — | — | — |

| B-757-200 | 79 | 18 | 4 | 101 | 19.6 | — | — | — |

| MD-88 | 93 | 23 | — | 116 | 26.4 | — | — | — |

| MD-90 | 65 | — | — | 65 | 19.9 | — | — | — |

| Total | 639 | 66 | 127 | 832 | 17.0 | 245 | 4 | 50 |

| | |

| --- | --- |

| (2) | During the June 2016 quarter, we reached an agreement with Bombardier to acquire 75 CS100 aircraft with deliveries beginning in 2018 and continuing through 2022. We have flexibility under the purchase agreement with respect to deferral, acceleration, conversion and a limited number of cancellation rights. The agreement also includes options to purchase 50 additional aircraft. |

| Shuttle America(2) | — | — | — | 14 | 16 | 30 |

| Total | 149 | 84 | 152 | 20 | 64 | 469 |

| (2) | Shuttle America merged into Republic Airline, Inc. effective January 31, 2017. |

| A330-300 | 2 | — | — | — | 2 |

| Total | 44 | 62 | 76 | 63 | 245 |

As of January 31, [removed: 2017,] [added: 2018,] there were approximately [removed: 2,818] [added: 2,560] holders of record of our common stock.

As reflected above, the Board has increased the quarterly dividend payment several times, most recently to [removed: $0.2025] [added: $0.305] per share in the September [removed: 2016] [added: 2017] quarter.

The following graph compares the cumulative total returns during the period from December 31, [removed: 2011] [added: 2012] to December 31, [removed: 2016] [added: 2017] of our common stock to the Standard & Poor's 500 Stock Index and the NYSE ARCA Airline Index.

The comparison assumes $100 was invested on December 31, [removed: 2011] [added: 2012] in each of our common stock and the indices and assumes that all dividends were reinvested.

[removed: ][added: ]

The following table presents information with respect to purchases of common stock we made during the December [removed: 2016] [added: 2017] quarter.

The total number of shares purchased includes shares repurchased pursuant to our $5 billion share repurchase program, which was publicly announced on May [removed: 13, 2015 ("the 2015 Repurchase Program").][added: 11, 2017 and will terminate no later than December 31, 2020.]

| Fiscal 2017 | | | | | | | | | | | | |

| Fourth Quarter | | $ | 56.84 | | | $ | 47.90 | | | $ | 0.305 | |

| Third Quarter | | $ | 55.75 | | | $ | 44.59 | | | $ | 0.305 | |

| Second Quarter | | $ | 54.53 | | | $ | 43.81 | | | $ | 0.2025 | |

| First Quarter | | $ | 52.00 | | | $ | 44.47 | | | $ | 0.2025 | |

| October 2017 | 1,382,740 | | $ | 52.67 | | 1,382,740 | | | $ | 4,925 | |

| November 2017 | 2,529,455 | | $ | 49.86 | | 2,529,455 | | | $ | 4,800 | |

| December 2017 | 2,321,176 | | $ | 54.34 | | 2,321,176 | | | $ | 4,675 | |

| Total | 6,233,371 | | | | | 6,233,371 | | | | | |

| Fiscal 2015 | | | | | | | | | | | | |

| Fourth Quarter | | $ | 52.77 | | | $ | 43.35 | | | $ | 0.135 | |

| Third Quarter | | $ | 48.30 | | | $ | 34.61 | | | $ | 0.135 | |

| Second Quarter | | $ | 47.98 | | | $ | 38.97 | | | $ | 0.09 | |

| First Quarter | | $ | 51.06 | | | $ | 42.60 | | | $ | 0.09 | |

The 2015 Repurchase Program will terminate no later than December 31, 2017.

| October 2016 | 7,540 | | $ | 40.40 | | 7,540 | | | $ | 1,650 | |

| November 2016 | 1,132,079 | | $ | 46.05 | | 1,132,079 | | | $ | 1,600 | |

| December 2016 | 4,987,902 | | $ | 49.83 | | 4,987,902 | | | $ | 1,350 | |

| Total | 6,127,521 | | | | | 6,127,521 | | | | | |

The following tables are derived from our audited Consolidated Financial Statements and present selected financial and operating data [added: as of and] for the [added: five] years ended December 31, [removed: 2016, 2015, 2014, 2013 and 2012.][added: 2017.]

| (in millions, except share data) | [added: 2017 | | |] 2016 | | | 2015 | | | 2014 | | | 2013 | | | [removed: 2012 | | |]

| Operating revenue | $ | [removed: 39,639] [added: 41,244] | | $ | [removed: 40,704] [added: 39,639] | | $ | [removed: 40,362] [added: 40,704] | | $ | [removed: 37,773] [added: 40,362] | | $ | [removed: 36,670] [added: 37,773] | |

| Operating expense | [added: 35,130 | | |] 32,687 | | | 32,902 | | | 38,156 | | | 34,373 | | | [removed: 34,495 | | |]

| Operating income | [added: 6,114 | | |] 6,952 | | | 7,802 | | | 2,206 | | | 3,400 | | | [removed: 2,175 | | |]

| Non-operating expense, net | [removed: (316] [added: (413] | | ) | [removed: (645] [added: (316] | | ) | [removed: (1,134] [added: (645] | | ) | [removed: (873] [added: (1,134] | | ) | [removed: (1,150] [added: (873] | | ) |

| Income before income taxes | [added: 5,701 | | |] 6,636 | | | 7,157 | | | 1,072 | | | 2,527 | | | [removed: 1,025 | | |]

| Income tax (provision) benefit | [added: (2,124 | | ) |] (2,263 | | ) | (2,631 | | ) | (413 | | ) | 8,013 | | | [removed: (16 | | ) |]

| Net income | $ | [removed: 4,373] [added: 3,577] | | $ | [removed: 4,526] [added: 4,373] | | $ | [removed: 659] [added: 4,526] | | $ | [removed: 10,540] [added: 659] | | $ | [removed: 1,009] [added: 10,540] | |

| Basic earnings per share | $ | [removed: 5.82] [added: 4.97] | | $ | [removed: 5.68] [added: 5.82] | | $ | [removed: 0.79] [added: 5.68] | | $ | [removed: 12.41] [added: 0.79] | | $ | [removed: 1.20] [added: 12.41] | |

| Diluted earnings per share | $ | [removed: 5.79] [added: 4.95] | | $ | [removed: 5.63] [added: 5.79] | | $ | [removed: 0.78] [added: 5.63] | | $ | [removed: 12.29] [added: 0.78] | | $ | [removed: 1.19] [added: 12.29] | |

| Cash dividends declared per share | $ | [removed: 0.68] [added: 1.02] | | $ | [removed: 0.45] [added: 0.68] | | $ | [removed: 0.30] [added: 0.45] | | $ | [removed: 0.12] [added: 0.30] | | $ | [removed: —] [added: 0.12] | |

| (in millions) | [added: 2017 | | |] 2016 | | | 2015 | | | 2014 | | | 2013 | | | [removed: 2012 | | |]

| MTM adjustments and settlements | $ | [added: 259 | | $ |] 450 | | $ | 1,301 | | $ | (2,346 | ) | $ | 276 | | [removed: $ | 27 | |]

| Restructuring and other | — | | | [removed: (35] [added: —] | | [removed: )] | [removed: (716] [added: (35] | | ) | [removed: (424] [added: (716] | | ) | [removed: (452] [added: (424] | | ) |

| Loss on extinguishment of debt | — | | | — | | | [removed: (268] [added: —] | | [removed: )] | [removed: —] [added: (268] | | [added: )] | [removed: (118] [added: —] | | [removed: )] |

| [removed: Virgin Atlantic] [added: Investment] MTM adjustments | [added: (8 | | ) |] 115 | | | 26 | | | (134 | | ) | — | | | [removed: — | | |]

| Release of tax valuation allowance and intraperiod income tax allocation | — | | | — | | | — | | | [removed: 7,989] [added: —] | | | [removed: —] [added: 7,989] | | |

| Total income (loss) | $ | [added: 101 | | $ |] 565 | | $ | 1,292 | | $ | (3,464 | ) | $ | 7,841 | | [removed: $ | (543 | ) |]

| Total assets | $ | [removed: 51,261] [added: 53,292] | | $ | [removed: 53,134] [added: 51,261] | | $ | [removed: 54,005] [added: 53,134] | | $ | [removed: 52,104] [added: 54,005] | | $ | [removed: 43,933] [added: 52,104] | |

| Long-term debt and capital leases (including current maturities) | $ | [removed: 7,332] [added: 8,834] | | $ | [removed: 8,329] [added: 7,332] | | $ | [removed: 9,661] [added: 8,329] | | $ | [removed: 11,194] [added: 9,661] | | $ | [removed: 12,555] [added: 11,194] | |

| Stockholders' equity [removed: (deficit)] | $ | [removed: 12,287] [added: 13,910] | | $ | [removed: 10,850] [added: 12,287] | | $ | [removed: 8,813] [added: 10,850] | | $ | [removed: 11,643] [added: 8,813] | | $ | [removed: (2,131] [added: 11,643] | [removed: )] |

| Consolidated(1) | [added: 2017 | | |] 2016 | | | 2015 | | | 2014 | | | 2013 | | | [removed: 2012 | | |]

| Revenue passenger miles (in millions) | [added: 217,712 | | |] 213,098 | | | 209,625 | | | 202,925 | | | 194,988 | | | [removed: 192,974 | | |]

| Available seat miles (in millions) | [added: 254,325 | | |] 251,867 | | | 246,764 | | | 239,676 | | | 232,740 | | | [removed: 230,415 | | |]

| Passenger mile yield | | [removed: 15.85] [added: 15.99] | ¢ | | [removed: 16.59] [added: 15.85] | ¢ | | [removed: 17.22] [added: 16.59] | ¢ | | [removed: 16.89] [added: 17.22] | ¢ | | [removed: 16.46] [added: 16.89] | ¢ |

| Passenger revenue per available seat mile | | [removed: 13.41] [added: 13.69] | ¢ | | [removed: 14.10] [added: 13.41] | ¢ | | [removed: 14.58] [added: 14.10] | ¢ | | [removed: 14.15] [added: 14.58] | ¢ | | [removed: 13.78] [added: 14.15] | ¢ |

| Operating cost per available seat mile | | [removed: 12.98] [added: 13.81] | ¢ | | [removed: 13.33] [added: 12.98] | ¢ | | [removed: 15.92] [added: 13.33] | ¢ | | [removed: 14.77] [added: 15.92] | ¢ | | [removed: 14.97] [added: 14.77] | ¢ |

| Passenger load factor | [removed: 84.6] [added: 85.6] | | % | [removed: 84.9] [added: 84.6] | | % | [removed: 84.7] [added: 84.9] | | % | [removed: 83.8] [added: 84.7] | | % | 83.8 | | % |

| Fuel gallons consumed (in millions) | [added: 4,032 | | |] 4,016 | | | 3,988 | | | 3,893 | | | 3,828 | | | [removed: 3,769 | | |]

| Average price per fuel gallon(2) | $ | [removed: 1.49] [added: 1.68] | | $ | [removed: 1.90] [added: 1.49] | | $ | [removed: 3.47] [added: 1.90] | | $ | [removed: 3.00] [added: 3.47] | | $ | [removed: 3.25] [added: 3.00] | |

| Full-time equivalent employees, end of period | [added: 86,564 | | |] 83,756 | | | 82,949 | | | 79,655 | | | 77,755 | | | [removed: 73,561 | | |]

| Tax Cuts and Jobs Act | (150 | | ) | — | | | — | | | — | | | — | | |

| (in millions) | 2017 | | | 2016 | | | 2015 | | | 2014 | | | 2013 | | |

| Total revenue per available seat mile | | 16.22 | ¢ | | 15.74 | ¢ | | 16.50 | ¢ | | 16.84 | ¢ | | 16.23 | ¢ |

| [Report of Independent Registered Public Accounting [removed: Firm](#sE984F414536956EF9CAB416DAB6DDAA2)] [added: Firm](#s37C86D7B414257A2B6A8399A99E9FC8F)] | [removed: [53](#sE984F414536956EF9CAB416DAB6DDAA2)] [added: [49](#s37C86D7B414257A2B6A8399A99E9FC8F)] |

| [Consolidated Balance Sheets - December 31, [removed: 2016] [added: 2017] and [removed: 2015](#s833817E58A865123A601A2F5F55707F7)] [added: 2016](#sF4827B882CC258A7BC0F5EF816EE93BD)] | [removed: [54](#s833817E58A865123A601A2F5F55707F7)] [added: [50](#sF4827B882CC258A7BC0F5EF816EE93BD)] |

| [Consolidated Statements of Operations for the years ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014](#sF41A29C4909651A2924169BCBE2E3079)] [added: 2015](#sEFD1156E791E5A2FBC88EF5BAA7C95CF)] | [removed: [55](#sF41A29C4909651A2924169BCBE2E3079)] [added: [51](#sEFD1156E791E5A2FBC88EF5BAA7C95CF)] |

| [Consolidated Statements of Comprehensive Income [removed: (Loss)] for the years ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014](#sA17D8E99DE7E5A64B414731D956B7168)] [added: 2015](#sEC59C522640E589EBED10AD09190C8F5)] | [removed: [56](#sA17D8E99DE7E5A64B414731D956B7168)] [added: [52](#sEC59C522640E589EBED10AD09190C8F5)] |

| [Consolidated Statements of Cash Flows for the years ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014](#s18A908ACCDFE515A9B5972BA84EFFE64)] [added: 2015](#sC6540297AF2E58A6B40F41C01FFC469D)] | [removed: [57](#s18A908ACCDFE515A9B5972BA84EFFE64)] [added: [53](#sC6540297AF2E58A6B40F41C01FFC469D)] |

| [Consolidated Statements of Stockholders' Equity for the years ended December 31, [removed: 2016, 2015] [added: 2017, 2016] and [removed: 2014](#s4F827375F9FC5C6A984EFE0713934708)] [added: 2015](#sA628F4E022D5525896416DD2E09BA54D)] | [removed: [58](#s4F827375F9FC5C6A984EFE0713934708)] [added: [54](#sA628F4E022D5525896416DD2E09BA54D)] |

| [Notes to the Consolidated Financial [removed: Statements](#s7EF00B47FA3C5EF3BFCE94CD77ADC536)] [added: Statements](#s18DD4BB7DFAA5A3FA1120C43548195C2)] | [removed: [59](#s7EF00B47FA3C5EF3BFCE94CD77ADC536)] [added: [55](#s18DD4BB7DFAA5A3FA1120C43548195C2)] |

| [Note 1 - Summary of Significant Accounting [removed: Policies](#s91E4C4E22A9D5413839B8A8A007A3B94)] [added: Policies](#s6272D997B0305A34B27B86D5F0DE0885)] | [removed: [59](#s91E4C4E22A9D5413839B8A8A007A3B94)] [added: [55](#s6272D997B0305A34B27B86D5F0DE0885)] |

| [Note 2 - Fair Value [removed: Measurements](#sA7CE7A027C6D5F4FA53A2D2F87B72EEA)] [added: Measurements](#s8B1B08A8004C57329F08B5647338C739)] | [removed: [67](#sA7CE7A027C6D5F4FA53A2D2F87B72EEA)] [added: [63](#s8B1B08A8004C57329F08B5647338C739)] |

| [Note 3 - [removed: Investments](#sFC95BCB6DFC85C739CFF4F4A4BEC0813)] [added: Investments](#s06E97823F8395E3EAA62B2462B5D7FEE)] | [removed: [68](#sFC95BCB6DFC85C739CFF4F4A4BEC0813)] [added: [64](#s06E97823F8395E3EAA62B2462B5D7FEE)] |

| [Note 4 - Derivatives and Risk [removed: Management](#s7C83C12080D65B228CC1DB5D4BEEE695)] [added: Management](#sF9E80B4682165B2BAAC3FDAD77FFFB8F)] | [removed: [70](#s7C83C12080D65B228CC1DB5D4BEEE695)] [added: [66](#sF9E80B4682165B2BAAC3FDAD77FFFB8F)] |

| [Note 5 - Intangible [removed: Assets](#s0BB97F1013E25866863F8013AF0DCB97)] [added: Assets](#s861386D8F5EB58DD8F5C7A11CF580C41)] | [removed: [73](#s0BB97F1013E25866863F8013AF0DCB97)] [added: [68](#s861386D8F5EB58DD8F5C7A11CF580C41)] |

| [Note 6 - Long-Term [removed: Debt](#s26CDFCAC8FD2562DA0D828DA86DAB275)] [added: Debt](#s2D186BF002795EFB9351D0E0B3BCAC51)] | [removed: [74](#s26CDFCAC8FD2562DA0D828DA86DAB275)] [added: [69](#s2D186BF002795EFB9351D0E0B3BCAC51)] |

| [Note 7 - Lease [removed: Obligations](#s410CA60D016953BD969F35AAE07E506B)] [added: Obligations](#sD8CA88A405A251D4AEEF60437D8457E4)] | [removed: [76](#s410CA60D016953BD969F35AAE07E506B)] [added: [71](#sD8CA88A405A251D4AEEF60437D8457E4)] |

| [Note [removed: 8] [added: 9] - Employee Benefit [removed: Plans](#s8884416442BE5988A8D7CDC682446FD5)] [added: Plans](#s7AE1F0C14CF0539EB6FB6DC999F24AA9)] | [removed: [78](#s8884416442BE5988A8D7CDC682446FD5)] [added: [73](#s7AE1F0C14CF0539EB6FB6DC999F24AA9)] |

| [Note [removed: 9] [added: 10] - Commitments and [removed: Contingencies](#sCB0A0047BFAD51AF8B6ED954ABA93A6E)] [added: Contingencies](#s4254C98A1B135498AF75CCBE0F888E86)] | [removed: [83](#sCB0A0047BFAD51AF8B6ED954ABA93A6E)] [added: [79](#s4254C98A1B135498AF75CCBE0F888E86)] |

| [Note [removed: 10] [added: 11] - Income [removed: Taxes](#sD294107D8339581385A2C21CD7750A67)] [added: Taxes](#sFB23BCDBBE9E5580ABC6242401199726)] | [removed: [86](#sD294107D8339581385A2C21CD7750A67)] [added: [82](#sFB23BCDBBE9E5580ABC6242401199726)] |

| [Note [removed: 11] [added: 12] - Equity and Equity [removed: Compensation](#sD3E00932D4E25EE0B29DEBAF72B5D7A5)] [added: Compensation](#s57886DCDF75B565BB9AA107B01E386D8)] | [removed: [88](#sD3E00932D4E25EE0B29DEBAF72B5D7A5)] [added: [84](#s57886DCDF75B565BB9AA107B01E386D8)] |

| [Note [removed: 12] [added: 13] - Accumulated Other Comprehensive [removed: Loss](#s8FDF07E89891554DA8BB9D354056C190)] [added: Loss](#s18AB3DEBCEDC5EC8A8223EBD70301FEA)] | [removed: [89](#s8FDF07E89891554DA8BB9D354056C190)] [added: [85](#s18AB3DEBCEDC5EC8A8223EBD70301FEA)] |

| [Note [removed: 13] [added: 14] - Segments and Geographic [removed: Information](#sDF4BB49CDDE35B68AAA4CCDF7F3E1F5B)] [added: Information](#s6CE4C35F7359550D8A8C14BD580D8C4E)] | [removed: [89](#sDF4BB49CDDE35B68AAA4CCDF7F3E1F5B)] [added: [85](#s6CE4C35F7359550D8A8C14BD580D8C4E)] |

| [Note [removed: 14] [added: 15] - Restructuring and [removed: Other](#s3F486F593AF9582EA50262751EB1E9CB)] [added: Other](#s3DEECA44F47759A1B656EF202423A7E9)] | [removed: [91](#s3F486F593AF9582EA50262751EB1E9CB)] [added: [87](#s3DEECA44F47759A1B656EF202423A7E9)] |

| [Note [removed: 15] [added: 16] - Earnings Per [removed: Share](#s89E083A3FA1A5D93927E79FBA288B9E2)] [added: Share](#sA681D467706152B6BCE8089F8E867F21)] | [removed: [92](#s89E083A3FA1A5D93927E79FBA288B9E2)] [added: [88](#sA681D467706152B6BCE8089F8E867F21)] |

| [Note [removed: 16] [added: 17] - Quarterly Financial Data [removed: (Unaudited)](#s65CBA786F3E35FF2A8C26F90D26727BA)] [added: (Unaudited)](#s2F4EFA89AFBC52CFBAD06F1AC3BB974D)] | [removed: [93](#s65CBA786F3E35FF2A8C26F90D26727BA)] [added: [88](#s2F4EFA89AFBC52CFBAD06F1AC3BB974D)] |

To the Board of Directors and Stockholders of [removed: Delta Air Lines, Inc.]

We have audited the accompanying consolidated balance sheets of Delta Air Lines, Inc. (the Company) as of December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] and the related consolidated statements of operations, comprehensive [removed: income (loss),] [added: income,] cash flows, and stockholders' equity for each of the three years in the period ended December 31, [removed: 2016.][added: 2017, and the related notes (collectively referred to as the “consolidated financial statements”).]

Our responsibility is to express an opinion on [removed: these] [added: the Company’s] financial statements based on our audits.

We conducted our audits in accordance with the standards of the [removed: Public Company Accounting Oversight Board (United States).][added: PCAOB.]

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material [removed: misstatement.][added: misstatement, whether due to error or fraud.]

[removed: An audit includes] [added: Such procedures included] examining, on a test basis, evidence [removed: supporting] [added: regarding] the amounts and disclosures in the financial statements.

[removed: An audit] [added: Our audits] also [removed: includes assessing] [added: included evaluating] the accounting principles used and significant estimates made by management, as well as evaluating the overall [added: presentation of the] financial [removed: statement presentation.][added: statements.]

In our opinion, the [added: consolidated] financial statements [removed: referred to above] present fairly, in all material respects, the [removed: consolidated] financial position of [removed: Delta Air Lines, Inc.] [added: the Company] at December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] and the [removed: consolidated] results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2016,] [added: 2017,] in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United [removed: States), Delta Air Lines, Inc.'s] [added: States) (PCAOB), the Company's] internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 [removed: framework)] [added: framework),] and our report dated February [removed: 13, 2017] [added: 23, 2018] expressed an unqualified opinion thereon.

| (in millions, except [added: per] share data) | [added: 2017] | [added: | | |] 2016 | | | | 2015 | | |

| Cash and cash equivalents | | $ | [removed: 2,762] [added: 1,814] | | | $ | [removed: 1,972] [added: 2,762] | |

| Short-term investments | | [removed: 487] [added: 825] | | | | [removed: 1,465] [added: 487] | | |

| Accounts receivable, net of an allowance for uncollectible accounts of [removed: $15] [added: $12] and [removed: $9] [added: $15] at December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] respectively | | [removed: 2,064] [added: 2,377] | | | | [removed: 2,020] [added: 2,064] | | |

| Fuel inventory | | [removed: 519] [added: 916] | | | | [removed: 379] [added: 519] | | |

| Expendable parts and supplies inventories, net of an allowance for obsolescence of [removed: $110] [added: $113] and [removed: $114] [added: $110] at December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] respectively | | [removed: 372] [added: 413] | | | | [removed: 318] [added: 372] | | |

| Prepaid expenses and other | | [removed: 854] [added: 1,499] | | | | [removed: 915] [added: 1,247] | | |

| Total current assets | | [removed: 7,451] [added: 7,844] | | | | [removed: 9,056] [added: 7,451] | | |

| [Note 8 - Airport Redevelopment](#s4dbc162a035540ea92e3ac147926c6f7) | [72](#s4dbc162a035540ea92e3ac147926c6f7) |

Delta Air Lines, Inc.

Opinion on the Financial Statements

Basis for Opinion

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Our audits included performing procedures to assess the risks of material misstatements of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

| We have served as the Company's auditor since 2006. | |

| Fuel card obligation | | 1,067 | | | | 431 | | |

| Other | 2,249 | | | | 1,986 | | | | 2,033 | | |

| Net change in derivative contracts | (27 | | ) | | (43 | | ) | | (82 | | ) |

| Depreciation and amortization | 2,235 | | | | 1,902 | | | | 1,835 | | |

| Treasury stock, net, contributed to our qualified defined benefit pension plans | — | | — | | | 188 | | | — | | | — | | | (8 | ) | 155 | | | 343 | | |

| Balance at December 31, 2017 | 715 | | $ | — | | $ | 12,053 | | $ | 9,636 | | $ | (7,621 | ) | 7 | | $ | (158 | ) | $ | 13,910 | |

We will adopt the standard effective January 1, 2018 using the full retrospective approach.

While the adoption of the new standard will not have a significant effect on earnings, the classification of certain revenues that are currently classified in other revenue will be reclassified to passenger revenue.

These include baggage fees, administrative charges and other travel-related fees, all of which will be deemed part of the single performance obligation of providing passenger transportation.

These revenues, which are approximately $2 billion annually, will be reclassified from the current presentation in other revenue to passenger revenue after adoption.

In addition, the adoption of the new standard increases the rate used to account for frequent flyer miles.

We currently analyze our standalone sales of mileage credits to other airlines and customers to establish the accounting value for frequent flyer miles.

Considering the guidance in the new standard, we will change our valuation of a mileage credit to an analysis of the award redemption value.

The new valuation considers the value a passenger receives by redeeming miles rather than paying cash for an award ticket.

This change increases our frequent flyer liability by approximately $2 billion.

The mileage deferral and redemption rates are approximately the same; therefore, assuming stable volume, there would not be a significant change in revenue recognized from the program for a given period.

The adoption of the new standard will also reduce our air traffic liability by approximately $500 million.

This change primarily results from estimating the tickets that will expire unused and recognizing revenue at the scheduled flight date rather than when the unused tickets expire.

We will adopt the standards effective January 1, 2018.

This standard does not apply to our investments in Grupo Aeroméxico and Virgin Atlantic, which are accounted for under the equity method.

Our investment in Air France-KLM is currently accounted for at cost as our investment agreement restricts the sale or transfer of these shares for five years.

Despite the restriction, upon adoption of ASU No. 2016-01, this investment will be accounted for at fair value with changes in fair value recognized in net income.

*Retirement Benefits.* In 2017, the FASB issued ASU No. 2017-07, "Compensation—Retirement Benefits (Topic 715)." This standard requires an entity to report the service cost component in the same line item as other compensation costs.

The other components of net (benefit) cost will be required to be presented in the income statement separately from the service cost component and outside a subtotal of income from operations.

In 2017, we recorded $50 million of non-service costs that will be reclassified to non-operating expense upon adoption.

We will adopt the standard effective January 1, 2018.

*Comprehensive Income*.

In February 2018, the FASB issued ASU No. 2018-02, "Income Statement—Reporting Comprehensive Income (Topic 220)." This standard provides financial statement preparers with an option to reclassify stranded tax effects within AOCI from retained earnings due to the U.S. federal corporate income tax rate change in the Tax Cuts and Jobs Act of 2017.

The adoption of the standard may impact tax amounts stranded in AOCI related to our pension plans.

See Note 11 of the Notes to the Consolidated Financial Statements for more information.

We immediately retire shares repurchased pursuant to our share repurchase program.

Our marketing agreements with American Express extend to 2022.

During 2017, we completed a tender offer for additional shares of Grupo Aeroméxico.

| February 13, 2017 | |

| Hedge derivative asset | | 393 | | | | 1,987 | | |

| Hedge derivative liability | | 688 | | | | 2,581 | | |

| Restructuring and other | — | | | | 35 | | | | 716 | | |

| Other | 1,986 | | | | 1,998 | | | | 1,797 | | |

| Net change in foreign currency and interest rate derivatives | (43 | | ) | | (82 | | ) | | 3 | | |

| Restructuring and other | — | | | | 35 | | | | 758 | | |

| Extinguishment of debt | — | | | | 22 | | | | 268 | | |

| Acquisition of London-Heathrow slots | — | | | | (276 | | ) | | — | | |

| Proceeds for sales of E190 aircraft | 226 | | | | — | | | | — | | |

| Balance at January 1, 2014 | 869 | | $ | — | | $ | 13,982 | | $ | 3,049 | | $ | (5,130 | ) | 18 | | $ | (258 | ) | $ | 11,643 | |

*Standards Effective in Future Years*

Early adoption of the standard is permitted, but not before December 15, 2016.

We are currently evaluating how the adoption of the revenue recognition standard will impact our Consolidated Financial Statements.

Interpretations are on-going and could have a significant impact on our implementation.

While we currently believe the adoption will have little effect on earnings, the classification of certain transactions within revenues and between revenues and operating expenses may change.

Also, the adoption may increase the rate used to account for frequent flyer miles, which would impact the balance of the frequent flyer liability.

We do not expect these standards to have a material impact on our Consolidated Statements of Cash Flows.

It is effective for interim and annual periods beginning after December 15, 2017.

*Recently Adopted Standards*

*Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share.* In May 2015, the FASB issued ASU No. 2015-07, "Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)." Under the new standard, investments for which fair value is measured at net asset value per share (or its equivalent) using the practical expedient will no longer be categorized in the fair value hierarchy.

We adopted this standard effective January 1, 2016 and have updated our presentation of investments measured at net asset value accordingly.

*Equity Method Investments.* In March 2016, the FASB issued ASU No. 2016-07, "Investments—Equity Method and Joint Ventures (Topic 323)." This standard eliminates the requirement that when an existing cost method investment qualifies for use of the equity method, an investor must restate its historical financial statements, as if the equity method had been used since the investment was acquired.

Under the new guidance, at the point an investment qualifies for the equity method, any unrealized gain or loss in AOCI will be recognized in non-operating income/expense.

We adopted this standard during the March 2016 quarter.

Although none of our available-for-sale or cost investments qualified for use of the equity method during 2016, we expect the tender offer for additional capital stock of Grupo Aeroméxico to be completed in the March 2017 quarter, at which point our investment will qualify for the equity method of accounting.

For more information about our investments and the proposed cash tender offer for shares of Grupo Aeroméxico see Note 3, "Investments."

*Share-Based Compensation.* In March 2016, the FASB issued ASU No. 2016-09, "Compensation—Stock Compensation (Topic 718)." This standard makes changes to Topic 718 related to the accounting for forfeitures, employer tax withholding on share-based compensation and the financial statement presentation of excess tax benefits or deficiencies.

It also clarifies the statement of cash flows presentation for certain components of share-based awards.

We adopted this standard during the June 2016 quarter.

The adoption of this standard resulted in the recognition of $95 million of previously unrecognized excess tax benefits in deferred income taxes, net and an increase in retained earnings on our Consolidated Balance Sheet as of the beginning of the current year and the recognition of $33 million of excess tax benefits in our income tax provision for the year ended December 31, 2016.

We immediately retire substantially all shares upon repurchase.

During the current year, we changed our presentation by reclassifying a portion of the amounts previously recorded from APIC to retained earnings in each of the years presented.

The reclassification reduced retained earnings by $2.1 billion at December 31, 2015.

We will continue in future periods to allocate the share purchase price in excess of par value between APIC and retained earnings.

In December 2014, we amended our marketing agreements with American Express, which increased the value we receive under the agreements and extended the term to 2022.

The amended agreements became effective January 1, 2015.

The increased value received under the amended agreements increases the amount of deferred revenue for the travel component and increases the value of the other deliverables.

| Interest rate contract | 6 | | | — | | | 6 | | | (a)(b) |

| Restricted cash equivalents and investments | 49 | | | 49 | | | — | | | (a) |

Our management, including our Chief Executive Officer and Chief Financial Officer, concluded that the controls and procedures were effective as of December 31, [removed: 2016] [added: 2017] to ensure that material information was accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

During the three months ended December 31, [removed: 2016,] [added: 2017,] we did not make any changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Management conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, [removed: 2016] [added: 2017] using the criteria issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO") in the 2013 Internal Control-Integrated Framework.

Based on that evaluation, management believes that our internal control over financial reporting was effective as of December 31, [removed: 2016.][added: 2017.]

The effectiveness of our internal control over financial reporting as of December 31, [removed: 2016] [added: 2017] has been audited by Ernst & Young LLP, an independent registered public accounting firm, which also audited our Consolidated Financial Statements for the year ended December 31, [removed: 2016.][added: 2017.]

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING [removed: FIRM ON INTERNAL CONTROL OVER FINANCIAL REPORTING][added: FIRM]

We have audited Delta Air Lines, [removed: Inc.'s] [added: Inc.’s] internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria).

[removed: Delta Air Lines, Inc.'s] [added: The Company’s] management is responsible for maintaining effective internal control over financial [removed: reporting,] [added: reporting] and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying [removed: Management's] [added: Management’s] Annual Report on Internal Control Over Financial Reporting.

We conducted our audit in accordance with the standards of the [removed: Public Company Accounting Oversight Board (United States).][added: PCAOB.]

In our opinion, Delta Air Lines, Inc. [added: (the Company)] maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2016,] [added: 2017,] based on the COSO [removed: criteria.][added: criteria.]

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United [removed: States),] [added: States) (PCAOB),] the consolidated balance sheets of [removed: Delta Air Lines, Inc.] [added: the Company] as of December 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] and the related consolidated statements of operations, comprehensive [removed: income (loss),] [added: income,] cash flows and [removed: stockholders'] [added: stockholders’] equity for each of the three years in the period ended December 31, [removed: 2016] [added: 2017,] and [added: the related notes and] our report dated February [removed: 13, 2017] [added: 23, 2018] expressed an unqualified opinion thereon.

Opinion on Internal Control over Financial Reporting

Basis for Opinion

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

Definition and Limitation of Internal Control Over Financial Reporting

| February 23, 2018 | |

| February 13, 2017 | |

Information required by this item is set forth under the headings "Governance Matters," "Proposal 1 - Election of Directors - [removed: Certain] Information About Nominees" and "Other Matters - Section 16 Beneficial Ownership Reporting Compliance" in our Proxy Statement to be filed with the Commission related to our [removed: 2017] [added: 2018] Annual Meeting of Stockholders ("Proxy Statement"), and is incorporated by reference.

The following table provides information about the number of shares of common stock that may be issued under Delta's equity compensation plans as of December 31, [removed: 2016.][added: 2017.]

| (1) | Includes a maximum of [removed: 1,699,072] [added: 1,487,298] shares of common stock that may be issued upon the achievement of certain performance conditions under outstanding performance share awards as of December 31, [removed: 2016.] [added: 2017.] |

| (2) | Includes performance share awards, which do not have exercise prices. The weighted average exercise price of options is [removed: $21.22.] [added: $38.59.] |

| (3) | Reflects shares remaining available for issuance under Delta's Performance Compensation Plan. If any shares of our common stock are covered by an award under the Plan that [added: expires,] is canceled, forfeited or otherwise terminates without delivery of shares (including shares surrendered or withheld for payment of [removed: the exercise price of an award or] taxes related to an award), then such shares will again be available for issuance under the Plan except for (i) any shares tendered in payment of an option, (ii) shares withheld to satisfy any tax withholding obligation with respect to the exercise of an option or stock appreciation right ("SAR") or (iii) shares covered by a stock-settled SAR or other awards that were not issued upon the settlement of the award. Because [removed: 2,774,807] [added: 2,599,512] shares of restricted stock remain unvested and subject to forfeiture, these shares could again be available for issuance. |

| Equity compensation plans approved by securities holders | 3,365,648 | | $ | 21.53 | | 29,758,243 | |

| Total | 3,365,648 | | $ | 21.53 | | 29,758,243 | |

| Equity compensation plans approved by securities holders | 4,474,773 | | $ | 13.16 | | 30,977,782 | |

| Total | 4,474,773 | | $ | 13.16 | | 30,977,782 | |

Information required by this item is set forth under the headings "Governance [removed: Matters," "Executive Compensation - Post-Employment Compensation - Other Benefits - Pre-Existing Medical Benefits Agreement with Northwest"] [added: Matters"] and "Proposal 1 - Election of Directors" in our Proxy Statement and is incorporated by reference.

Information required by this item is set forth under the heading "Proposal [removed: 4] [added: 3] - Ratification of the Appointment of Independent Auditors" in our Proxy Statement and is incorporated by reference.