Revenue Recognition

3 Months Ended

Mar. 31, 2021

Revenue from Contract with Customer [Abstract]

Revenue Recognition

REVENUE RECOGNITION

Passenger Revenue

	Three Months Ended March 31,
(in millions)	2021		2020
Ticket	$	2,277	$	6,511
Loyalty travel awards	241		543
Travel-related services	230		515
Total passenger revenue	$	2,748	$	7,569

We recognized approximately $822 million and $2.8 billion in passenger revenue during the three months ended March 31, 2021 and 2020, respectively, that had been recorded in our air traffic liability balance at the beginning of those periods.

In March 2021, we announced the extension of the validity of all passenger tickets and travel credits expiring in 2021 or purchased in 2021 to December 2022. In addition, we have waived change fees for all tickets purchased through April 30, 2021, as well as eliminated change fees for domestic and international tickets originating from North America with the exception of Basic Economy tickets.

Other Revenue

	Three Months Ended March 31,
(in millions)	2021		2020
Ancillary businesses and refinery	$	726	$	223
Loyalty program	368		474
Miscellaneous	93		174
Total other revenue	$	1,187	$	871

Ancillary Businesses and Refinery. Ancillary businesses and refinery includes refinery sales to third parties, aircraft maintenance services we provide to third parties and our vacation wholesale operations.

Loyalty Program. Our SkyMiles loyalty program allows customers to earn mileage credits ("miles") by flying on Delta, Delta Connection and other airlines that participate in the loyalty program. Customers can also earn miles through participating companies, such as credit card companies, hotels, car rental agencies and ridesharing companies, who purchase miles from us. Our most significant contract to sell miles relates to our co-brand credit card relationship with American Express. During the three months ended March 31, 2021 and 2020, total cash sales from marketing agreements related to our loyalty program were $760 million and $992 million, respectively, which are allocated to travel and other performance obligations.

Current Activity of the Loyalty Program. Miles are combined in one homogeneous pool and are not separately identifiable. Therefore, the revenue is comprised of miles that were part of the loyalty program deferred revenue balance at the beginning of the period as well as miles that were issued during the period.

The table below presents the activity of the current and noncurrent loyalty program deferred revenue and includes miles earned through travel and miles sold to participating companies, which are primarily through marketing agreements.

Loyalty program activity
(in millions)	2021		2020
Balance at January 1	$	7,182	$	6,728
Miles earned	354		660
Travel miles redeemed	(241)		(543)
Non-travel miles redeemed	(10)		(28)
Balance at March 31	$	7,285	$	6,817

The timing of mile redemptions can vary widely; however, the majority of miles have historically been redeemed within two years of being earned.

Revenue by Geographic Region

Operating revenue for the airline segment is recognized in a specific geographic region based on the origin, flight path and destination of each flight segment. A significant portion of the refinery segment's revenues typically consists of fuel sales to support the airline, which is eliminated in the Condensed Consolidated Financial Statements. The remaining operating revenue for the refinery segment is included in the domestic region. Our passenger and operating revenue by geographic region is summarized in the following tables:

Passenger revenue by geographic region
	Passenger Revenue
	Three Months Ended March 31,
(in millions)	2021		2020
Domestic	$	2,280	$	5,601
Atlantic	142		818
Latin America	264		765
Pacific	62		385
Total	$	2,748	$	7,569

Operating revenue by geographic region
	Operating Revenue
	Three Months Ended March 31,
(in millions)	2021		2020
Domestic	$	3,368	$	6,267
Atlantic	267		994
Latin America	381		863
Pacific	134		468
Total	$	4,150	$	8,592