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Delta cuts passenger unit revenue forecast, shares drop

Passengers check in at a counter of Delta Air Lines in Mexico City, Mexico, August 8, 2016. REUTERS/Ginnette Riquelme/File Photo

(Reuters) - Delta Air Lines Inc DAL.N on Tuesday cut its forecast for passenger unit revenue, a closely watched performance metric, for the current quarter due to slower than anticipated recovery in fares for last-minute flights.

The No. 2 U.S. airline by passenger traffic said it now expects third-quarter passenger unit revenue, which compares sales to flight capacity, to rise 2-3 percent.

It had previously forecast an increase of 2.5-4.5 percent.

Delta also cut its operating margin forecast to 16.5-17.5 percent from 18-20 percent for the quarter.

The company’s shares were down 1.7 percent at $46.71 in premarket trading.

Reporting by Ankit Ajmera in Bengaluru; Editing by Savio D’Souza

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