UNITED STATES SECURITIES AND EXCHANGE COMMISSION

~~SECURITIES~~Washington, ~~AND~~D.C. ~~EXCHANGE~~20549 ~~COMMISSION~~

~~Washington,~~FORM ~~D.C. 20549~~10-Q

~~FORM 10-Q~~QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

~~QUARTERLY~~For ~~REPORT~~the ~~PURSUANT TO~~quarterly ~~SECTION 13~~period ORended ~~15(d)~~June 30, 2009

OFCommission ~~THE~~File ~~SECURITIES EXCHANGE~~Number: ~~ACT OF 1934~~1-15285

~~For the~~NORTHWEST ~~quarterly~~AIRLINES ~~period ended March 31,~~CORPORATION ~~2009~~

~~Commission~~(Exact ~~File~~name ~~Number: 1-15285~~of registrant as specified in its charter)

NORTHWEST AIRLINES CORPORATION


Delaware		41-1905580
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

2700 Lone Oak Parkway, Eagan, Minnesota		55121
(Address of principal executive offices)		(Zip Code)

(~~Exact name of registrant as specified in its charter~~612) 726-2111

Delaware		41-1905580
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
2700 Lone Oak Parkway, Eagan, Minnesota		55121
(Address of principal executive offices)		(Zip Code)

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (~~612~~1) has ~~726-2111~~filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Note: The registrant is no longer subject to the filing requirements of Section 13 or 15(~~Registrant’s~~d) ~~telephone~~of ~~number,~~the ~~including~~Securities ~~area~~Exchange ~~code)~~Act of 1934 and is now a voluntary filer.

Indicate by check mark whether the registrant ~~(1)~~ has ~~filed~~submitted ~~all~~electronically ~~reports~~and posted on its corporate Web site, if any, every Interactive Data File required to be ~~filed~~submitted byand ~~Section 13~~posted orpursuant ~~15(d)~~to Rule 405 of ~~the~~Regulation S-T ~~Securities~~(§232.405 ~~Exchange Act~~ of ~~1934~~this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to ~~file such~~submit ~~reports),~~ and ~~(2) has~~post ~~been subject to~~ such ~~filing requirements for the past 90 days~~files). ~~Yes x No~~ o

~~Note: The registrant is no longer subject to the filing requirements of Section~~Yes ~~13 or 15(d)~~o No ~~of the Securities Exchange Act of 1934 and is now a voluntary filer.~~o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer xþ Accelerated filer o Non-accelerated filer o (Do not check if a smaller reporting company) Smaller reporting company o

Indicate by a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ x

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.

Yes x þ No o

The registrant is a wholly owned subsidiary of Delta Air Lines, Inc., a Delaware corporation, ~~and~~ and there is no market for the registrant’s common stock, par value $0.01 per share. As of ~~April 20~~June 30, 2009, there were 1,000 shares of the registrant’s Common Stock outstanding.

The registrant meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this Form with the reduced disclosure format permitted by ~~General~~ General Instruction H(2).

~~Table of~~TABLE ~~Contents~~OF CONTENTS

NORTHWEST AIRLINES CORPORATION


FORWARD-LOOKING STATEMENTS
Financial Statements
Notes to the Condensed Consolidated Financial Statements
	ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
	ITEM 3. Quantitative and Qualitative Disclosures About Market Risk.
	ITEM 4. Controls and Procedures.
	PART II. OTHER INFORMATION
	ITEM 1. Legal Proceedings.
	ITEM 1A. Risk Factors.
	ITEM 6. Exhibits.
SIGNATURE
EX-31.1
EX-31.2

		Page No.
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements.
	Condensed Consolidated Statements of Operations	3
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Cash Flows	5
	Notes to Condensed Consolidated Financial Statements	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	20
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	24
Item 4.	Controls and Procedures.	24
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings.	24
Item 1A.	Risk Factors.	24
Item 6.	Exhibits.	24
SIGNATURE		25
EXHIBIT INDEX		25

2 Unless otherwise indicated, Northwest Airlines Corporation and our wholly-owned subsidiaries are collectively referred to as “Northwest,” “we,” “us,” and “our.”

~~Table of~~FORWARD-LOOKING ~~Contents~~STATEMENTS

~~PART~~ Statements in this Form 10-Q (or otherwise made by us or on our behalf) that are not historical facts, including statements about our estimates, expectations, beliefs, intentions, projections or strategies for the future, may be “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from historical experience or our present expectations. For examples of such risks and uncertainties, please see the cautionary statements contained in “Item I1A. Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2008 (“Form 10-K”) and “Part II, Item 1A. Risk Factors” in this Form 10-Q. ~~FINANCIAL~~All ~~INFORMATION~~forward-looking statements speak only as of the date made, and we undertake no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this report.

~~Item~~ 1~~. Financial Statements.~~

NORTHWEST AIRLINESTable CORPORATIONof Contents

~~CONDENSED~~NORTHWEST ~~CONSOLIDATED~~AIRLINES ~~STATEMENTS~~CORPORATION Consolidated OFBalance ~~OPERATIONS~~Sheets (Unaudited)

	Post-Merger			Pre-Merger
	June 30,				December 31,
	Three Months			Three Months
(in millions, except share data)	2009				2008
	Ended			Ended
ASSETS
	March 31,			March 31,
Current Assets:
(Unaudited, in millions except per share amounts)	2009			2008
Cash and cash equivalents	$	2,621			$	2,068
Operating Revenues
Short-term investments		21				49
Passenger	$	1,794		$	2,302
Restricted cash and cash equivalents		128				196
Regional carrier revenues	443			406
Accounts receivable, net of an allowance for uncollectible accounts of $3 and $6 at June 30, 2009 and December 31, 2008, respectively		638				659
Cargo	92			197
Hedge margin receivable		—				526
Other	269			229
Expendable parts and supplies inventories, net of an allowance for obsolescence of $13 and $3 at June 30, 2009 and December 31, 2008, respectively		156				152
Total operating revenues	2,598			3,134
Deferred income taxes, net		37				131
Operating Expenses
Prepaid expenses and other		258				232
Aircraft fuel and related taxes	586			1,115
Total current assets		3,859				4,013
Salaries and related costs	748			728
Property and Equipment, Net:
Contract carrier arrangements	190			264
Property and equipment, net of accumulated depreciation and amortization of $293 and $71 at June 30, 2009 and December 31, 2008, respectively		8,424				8,683
Depreciation and amortization	127			148
Other Assets:
Aircraft maintenance materials and outside repairs	155			209
Goodwill		4,578				4,572
Contracted services	222			206
Identifiable intangibles, net of accumulated amortization of $23 and $8 at June 30, 2009 and December 31, 2008, respectively		2,673				2,694
Passenger commissions and other selling expenses	175			215
Other noncurrent assets		173				236
Landing fees and other rents	148			129
Total other assets		7,424				7,502
Passenger service	53			59
Total assets	$	19,707			$	20,198
Aircraft rent	58			54
LIABILITIES AND STOCKHOLDER’S EQUITY
Goodwill and other indefinite-lived intangibles impairment	—			3,917
Current Liabilities:
Restructuring and merger related	53			—
Current maturities of long-term debt and capital leases	$	1,156			$	383
Other, net	103			143
Air traffic liability		1,422				1,451
Total operating expenses	2,618			7,187
Accounts payable		869				903
Operating Income (Loss)	(20		)	(4,053		)
Frequent flyer deferred revenue		499				522
Other Income (Expense)
Accrued salaries and related benefits		408				455
Interest expense	(173		)	(114		)
Hedge derivatives liability		61				561
Investment income	4			36
Taxes payable		256				199
Other, net	6			(8		)
Note payable to parent		600				200
Total other income (expense)	(163		)	(86		)
Other accrued liabilities		170				112
Income (Loss) Before Income Taxes	(183		)	(4,139		)
Total current liabilities		5,441				4,786
Income tax expense (benefit)	—			—
Noncurrent Liabilities:
Net Income (Loss)	$	(183	)	$	(4,139	)
Long-term debt and capital leases		4,373				5,382
Earnings (loss) per common share:
Pension, postretirement and related benefits		5,592				5,476
Basic and Diluted	N/A			$	(15.78	)
Frequent flyer deferred revenue		1,443				1,500
Average shares used in computation:
Deferred income taxes, net		989				1,094
Basic and Diluted	N/A			262
Other noncurrent liabilities		434				533
Total noncurrent liabilities		12,831				13,985
Commitments and Contingencies
Stockholder’s Equity:
Common stock at $0.01 par value; 1,000 shares issued at June 30, 2009 and December 31, 2008, respectively		—				—
Additional paid-in capital		3,663				3,605
Accumulated deficit		(761	)			(539	)
Accumulated other comprehensive loss		(1,467	)			(1,639	)
Total stockholder’s equity		1,435				1,427
Total liabilities and stockholder’s equity	$	19,707			$	20,198

~~See~~ The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

NORTHWEST AIRLINES CORPORATION Consolidated Statements of Operations (Unaudited)

CONDENSED CONSOLIDATED BALANCE SHEETS


	Post-Merger			Pre-Merger			Post-Merger			Pre-Merger
	Three Months Ended June 30,						Six Months Ended June 30,
(in millions, except per share data)	2009			2008			2009			2008


Operating Revenue:
Passenger:
Mainline	$	1,802		$	2,638		$	3,596		$	4,940
Regional carriers		462			506			905			912

Total passenger revenue		2,264			3,144			4,501			5,852
Cargo		84			213			176			410
Other, net		274			232			543			461

Total operating revenue		2,622			3,589			5,220			6,723

Operating Expense:
Salaries and related costs		733			748			1,481			1,476
Aircraft fuel and related taxes		599			1,185			1,185			2,300
Contract carrier arrangements		222			281			412			545
Contracted services		144			207			366			413
Aircraft maintenance materials and outside repairs		153			186			308			395
Passenger commissions and other selling expenses		124			224			299			439
Landing fees and other rents		131			143			279			272
Depreciation and amortization		126			745			253			893
Aircraft rent		60			56			118			110
Passenger service		62			66			115			125
Impairment of goodwill and other intangible assets		—			(76	)		—			3,841
Restructuring and merger-related items		31			—			84			—
Other		104			123			207			266

Total operating expense		2,489			3,888			5,107			11,075


Operating Income (Loss)		133			(299	)		113			(4,352	)

Other (Expense) Income:
Interest expense		(189	)		(108	)		(362	)		(222	)
Interest income		3			24			7			60
Miscellaneous, net		17			(208	)		23			(216	)

Total other expense, net		(169	)		(292	)		(332	)		(378	)


Loss Before Income Taxes		(36	)		(591	)		(219	)		(4,730	)

Income Tax (Provision) Benefit		(3	)		214			(3	)		214


Net Loss	$	(39	)	$	(377	)	$	(222	)	$	(4,516	)


Basic and Diluted Loss per Share		N/A		$	(1.43	)		N/A		$	(17.19	)

	Post-Merger			Post-Merger
	March 31,			December 31,
(Unaudited, in millions except share data)	2009			2008
Assets
Current Assets
Cash and cash equivalents	$	2,548		$	2,068
Unrestricted short-term investments	16			49
Restricted cash, cash equivalents and short-term investments	168			196
Accounts receivable, less allowance (2009—$6, 2008—$6)	567			659
Hedge margin receivable	179			526
Expendable parts and supplies inventories, less allowance (2009—$8, 2008—$3)	153			152
Deferred income taxes	70			131
Prepaid expenses and other	276			232
Total current assets	3,977			4,013
Property and Equipment, Net	8,595			8,683
Other Assets
Goodwill	4,570			4,572
Identifiable intangibles, less accumulated amortization (2009—$18; 2008—$8)	2,684			2,694
Other noncurrent assets	184			236
Total other assets	7,438			7,502
Total Assets	$	20,010		$	20,198
Liabilities and Stockholder’s Equity
Current Liabilities
Current maturities of long-term debt and capital lease obligations	$	1,141		$	383
Air traffic liability	1,483			1,451
Frequent flyer deferred revenue	524			522
Accounts payable	843			903
Hedge derivatives liability	231			560
Accrued salaries and related benefits	456			455
Taxes payable	228			199
Due to parent company	550			200
Other accrued liabilities	139			113
Total current liabilities	5,595			4,786
Noncurrent Liabilities
Long-term debt and capital leases	4,492			5,382
Pension, postretirement and related benefits	5,544			5,476
Frequent flyer deferred revenue	1,477			1,500
Deferred income taxes, net	1,022			1,094
Other noncurrent liabilities	463			533
Total noncurrent liabilities	12,998			13,985
Common Stockholder’s Equity
Post-Merger Common stock, $0.01 par value; shares issued—1,000 at March 31, 2009 and December 31, 2008	—			—
Additional paid-in capital	3,659			3,605
(Accumulated deficit) retained earnings	(722		)	(539		)
Accumulated other comprehensive (loss) income	(1,520		)	(1,639		)
Total stockholder’s equity	1,417			1,427
Total Liabilities and Stockholder’s Equity	$	20,010		$	20,198

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

~~See accompanying notes.~~3

4Table of Contents

~~Table of~~NORTHWEST ~~Contents~~AIRLINES CORPORATION

~~NORTHWEST~~Condensed ~~AIRLINES~~Consolidated ~~CORPORATION~~Statements of Cash Flow

~~CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS~~(Unaudited)

	Post-Merger			Pre-Merger
	Six Months Ended June 30,
	Three Months			Three Months
(in millions)	2009				2008
	Ended			Ended
Net cash provided by operating activities	$	369			$	477
	March 31,			March 31,
Cash Flows From Investing Activities:
(Unaudited, in millions)	2009			2008
Property and equipment additions, including advance payments, net		77				(695	)
Net cash provided by (used in) operating activities	$	261		$	362
Proceeds from sales of flight equipment		73				14
Cash Flows from Investing Activities
Redemption of short-term investments		28				55
Capital expenditures	(29		)	(366		)
Decrease in restricted cash and cash equivalents		7				300
Decrease (increase) in unrestricted short-term investments	17			55
Investment in affiliated companies		—				(213	)
Decrease (increase) in restricted cash, cash equivalents and short-term investments	11			240
Other, net		—				20
Proceeds from sale of property, equipment and other assets	72			1
Net cash provided by (used in) investing activities		185				(519	)
Investment in affiliated companies	—			(213		)
Cash Flows From Financing Activities:
Proceeds from the sale of investment in affiliated companies	—			20
Proceeds from intercompany loan		400				—
Net cash provided by (used in) investing activities	71			(263		)
Payments on long-term debt and capital lease obligations		(328	)			(216	)
Cash Flows from Financing Activities
(Payments) proceeds of short-term obligations, net		(73	)			133
Proceeds from long-term debt	30			246
Proceeds from long-term obligations		—				476
Payments of long-term debt and capital lease obligations	(232		)	(96		)
Payments of deferred financing costs		—				(74	)
Proceeds from intercompany loan	350			—
Net cash (used in) provided by financing activities		(1	)			319
Other, net	—			(1		)
Net Increase in Cash and Cash Equivalents		553				277
Net cash provided by (used in) financing activities	148			149
Cash and cash equivalents at beginning of period		2,068				2,939
Increase (Decrease) in Cash and Cash Equivalents	480			248
Cash and cash equivalents at end of period	$	2,621			$	3,216
Cash and cash equivalents at beginning of period	2,068			2,939
Non-cash transactions:
Cash and cash equivalents at end of period	$	2,548		$	3,187
Flight equipment	$	45			$	—
Available to be borrowed under credit facilities	$	700		$	117
Cash and cash equivalents and unrestricted short-term investments at end of period	$	2,564		$	3,227
Supplemental Cash Flow Information:
Interest paid	$	91		$	114

~~See~~The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

NORTHWEST AIRLINES CORPORATION

~~NOTES~~Notes TOto ~~CONDENSED~~the ~~CONSOLIDATED~~Condensed ~~FINANCIAL~~Consolidated ~~STATEMENTS~~Financial Statements

~~Note~~June 30, ~~1 – Basis of Presentation~~2009 (Unaudited)

~~The~~NOTE ~~condensed consolidated financial statements of Northwest Airlines Corporation (“NWA Corp~~1.~~”),~~ ~~the~~BASIS ~~direct~~OF ~~parent corporation of~~PRESENTATION Northwest Airlines, Inc. (“Northwest”), include the accounts of NWA Corp. and all consolidated subsidiaries (collectively, the “Company”). On October 29, 2008 (the “Closing Date”), Nautilus Merger Corporation (“Merger Sub”), a wholly owned subsidiary of Delta Air Lines, Inc. (“Delta”), merged with and into NWA Corp. (the “Merger”) in accordance with the Agreement and Plan of Merger, dated as of April 14, 2008 (the “Announcement Date”), among Delta, Merger Sub and NWA Corp. (the “Merger Agreement”). As a result of the Merger, NWA Corp. and its subsidiaries became wholly-owned subsidiaries of Delta and the shares of NWA Corp., which traded under the symbol “NWA”, ceased trading on, and were delisted from, the New York Stock Exchange (“NYSE”).

As The aaccompanying ~~result~~unaudited ofCondensed ~~the application~~Consolidated ofFinancial ~~purchase~~Statements ~~accounting~~have inbeen prepared in accordance with ~~Financial~~accounting ~~Accounting Standards~~principles ~~Board~~generally ~~(“FASB”)~~accepted ~~Statement~~in ofthe ~~Financial~~United ~~Accounting~~States ~~Standards~~of America (“~~SFAS~~GAAP”) ~~No. 141,~~ ~~Business~~for ~~Combinations~~interim ~~(“SFAS~~financial Noinformation. ~~141”), the~~ ~~financial~~Consistent ~~statements~~with ~~prior~~these ~~to October 30~~requirements, ~~2008~~this ~~are~~Form ~~not~~10-Q ~~comparable~~does ~~with~~not ~~the~~include ~~financial~~all ~~statements~~the ~~for~~information ~~periods~~required onby orGAAP ~~after~~for ~~October 30,~~complete ~~2008~~financial statements. ~~References~~ toAs ~~“Post-Merger”~~a ~~refer~~result, ~~to the~~this ~~Company~~Form on10-Q orshould ~~after~~be ~~October 30,~~read ~~2008,~~in ~~after~~conjunction ~~giving~~with ~~effect~~the toConsolidated ~~the application~~Financial ofStatements ~~purchase~~and ~~accounting.~~ accompanying ~~References~~Notes toin ~~“Pre-Merger”~~our ~~refer~~Form ~~to the Company prior to October 30, 2008~~10-K.

~~Unless~~ On ~~otherwise indicated~~October 29, 2008 (the ~~terms~~ “~~we,”~~Closing ~~“us,~~Date”), ~~and~~a ~~“our”~~wholly-owned ~~refer~~subsidiary toof ~~NWA~~Delta ~~Corp.~~Air ~~and~~Lines, ~~all consolidated subsidiaries~~Inc. ~~The condensed~~ ~~consolidated~~(“Delta”) ~~financial~~merged ~~statements~~(the ~~included~~“Merger”) ~~herein~~with ~~have~~and ~~been~~into ~~prepared~~Northwest ~~pursuant to~~Airlines ~~the~~Corporation. ~~rules and~~On ~~regulations of~~ the ~~Securities~~Closing ~~and Exchange Commission~~ Date, (~~“SEC”~~1)~~. The~~ Northwest ~~information~~Airlines Corporation and ~~footnote~~its ~~disclosures normally~~wholly-owned ~~included~~subsidiaries, inincluding ~~annual~~Northwest ~~financial statements prepared in accordance with~~Airlines, UInc.S. ~~Generally Accepted Accounting Principles~~ (collectively, “~~GAAP~~Northwest”), ~~have~~became ~~been~~wholly-owned ~~condensed~~subsidiaries ~~or omitted~~of asDelta ~~permitted~~and ~~by such rules~~(2) ~~and~~each ~~regulations.~~share ~~These financial~~of ~~statements~~Northwest ~~and~~common ~~related~~stock ~~notes~~outstanding ~~should~~on ~~be read in conjunction with~~ the ~~financial statements~~Closing ~~and~~Date ~~notes~~or ~~included~~issuable inunder ~~the Company~~Northwest’s ~~audited~~Plan ~~consolidated financial~~of ~~statements,~~Reorganization ~~which~~(as ~~are~~defined ~~provided~~ in ~~the~~Note ~~Company’s~~8) ~~Annual~~was ~~Report~~converted oninto ~~Form 10-K for~~ the ~~year~~right ~~ended~~to ~~December 31,~~receive ~~2008~~1.25 ~~(the~~shares ~~“2008~~of ~~Form 10-K”)~~Delta common stock.

~~Northwest’s operations~~ As ~~account~~a ~~for~~result ~~approximately 99%~~ of the ~~Company’s~~application ~~consolidated operating~~of ~~revenues~~purchase ~~and~~accounting ~~expenses. Northwest~~in isaccordance awith ~~major~~Statement ~~air carrier engaged principally in the commercial~~of ~~transportation~~Financial ofAccounting ~~passengers~~Standards ~~and~~(“SFAS”) ~~cargo~~No. ~~Northwest’s global airline network includes domestic hubs at Detroit~~141, ~~Minneapolis/St.~~ ~~Paul~~“Business ~~and Memphis~~Combinations”, anthe Condensed ~~extensive~~Consolidated ~~Pacific~~Financial ~~route~~Statements ~~system~~on ~~with~~or aafter ~~hub in Tokyo~~October 30, a2008 ~~transatlantic~~are ~~joint~~not ~~venture~~comparable ~~with~~to ~~KLM Royal Dutch Airlines (“KLM”),~~the ~~which~~Condensed ~~operates~~Consolidated ~~through~~Financial aStatements ~~hub~~prior into ~~Amsterdam,~~that adate. ~~domestic~~References ~~and~~to ~~international alliance with Continental Airlines, Inc. (~~“~~Continental~~Post-Merger”) ~~and Delta,~~refer ~~membership~~to inNorthwest ~~SkyTeam,~~on aor ~~global~~after ~~airline alliance with KLM~~October 30, ~~Continental~~2008, ~~Delta, Air~~after ~~France,~~giving ~~Aeroflot,~~effect ~~Alitalia,~~to ~~Aeromexico,~~the ~~China~~application ~~Southern,~~of ~~CSA Czech Airlines~~purchase ~~and Korean Air, exclusive marketing agreements with three domestic regional carriers, Pinnacle Airlines, Inc~~accounting. ~~(“Pinnacle”),~~References ~~Mesaba~~to ~~Aviation, Inc. (~~“~~Mesaba~~Pre-Merger”), arefer ~~wholly-owned~~to ~~subsidiary,~~Northwest ~~and~~prior ~~Compass~~to ~~Airlines,~~October ~~Inc. (“Compass”)~~30, a wholly-owned subsidiary, which currently operate as Delta Connection carriers and a cargo business that includes a dedicated fleet of freighter aircraft that operate through hubs in Anchorage and Tokyo2008.

~~Continental~~ Our ~~has provided~~Condensed ~~written~~Consolidated ~~notice~~Financial toStatements include the ~~Company~~accounts of Northwest Airlines Corporation and ~~Delta~~our ofwholly-owned ~~its~~subsidiaries. ~~decision~~To tothe ~~terminate~~extent that an asset, ~~the~~liability, ~~three-way~~revenue ~~alliance~~or ~~agreement~~expense is directly associated with Northwest, it is reflected as such in the accompanying ~~Company~~Condensed Consolidated Financial Statements. Certain other revenue and expense have been allocated from Delta ~~effective~~to ~~July 30,~~Northwest based on key business activity drivers in accordance with Delta’s cost allocation ~~2009~~policy. ~~Codesharing~~ ~~and~~Management ~~certain~~believes ~~other aspects~~such ofallocations are reasonable; however, they may not be equivalent to the ~~relationship~~actual ~~will~~revenue ~~continue~~and ~~until~~expense ~~October 24,~~that ~~2009,~~would ~~which~~have isbeen recognized had we been operating as an ~~also~~independent, publicly-traded company for the ~~date~~periods ofpresented ~~Continental’s~~subsequent ~~planned~~to ~~exit~~the ~~from~~Closing ~~SkyTeam~~Date.

~~The~~ Management ~~Company~~believes ~~has~~that ~~decided to~~the ~~discontinue~~accompanying ~~its~~unaudited ~~dedicated~~Condensed ~~freighter~~Consolidated ~~fleet and remove the remaining Boeing~~Financial ~~747F~~Statements ~~aircraft~~reflect ~~from~~all ~~service by December 31~~adjustments, ~~2009. The~~including ~~Company~~adjustments ~~performed~~required anby ~~impairment~~purchase ~~test in accordance with SFAS No. 144~~accounting, ~~Accounting~~normal ~~for~~recurring ~~the~~items ~~Impairment~~and orrestructuring ~~Disposal~~and ~~of Long~~merger-~~Lived~~related ~~Assets~~items, ~~(“SFAS~~considered ~~No. 144”), and~~necessary ~~determined~~for ~~that~~a nofair statement ~~material~~of ~~impairment~~results ~~currently~~for ~~exists~~the ~~related~~interim toperiods ~~these aircraft~~presented.

~~The~~ Due ~~Company~~to ~~maintains~~seasonal ~~a Web~~variations ~~site~~in ~~at http://www.nwa.com. Information contained on~~ the ~~Company’s~~demand ~~Web site~~for isair ~~not~~travel, ~~incorporated~~the ~~into~~volatility ~~this~~of ~~quarterly~~aircraft ~~report on Form 10-Q. Annual reports on Form 10-K, quarterly~~fuel ~~reports on Form 10-Q~~prices, ~~current~~changes ~~reports~~in onglobal ~~Form 8-K,~~economic conditions and ~~all~~other ~~amendments to~~factors, ~~those~~operating ~~reports~~results ~~are~~for ~~available free of charge through~~ the ~~SEC~~three and ~~Web~~six ~~site~~months atended ~~http://idea.sec.gov~~June 30, as2009 ~~soon~~are asnot ~~reasonably practicable~~necessarily ~~after~~indicative ~~those~~of ~~reports~~operating ~~are~~results ~~electronically~~for ~~filed with or furnished to~~ the entire ~~SEC~~year.

~~In the~~ We ~~opinion~~have ofreclassified ~~management,~~certain ~~the~~prior ~~interim~~period ~~financial~~amounts ~~statements~~in ~~reflect adjustments,~~our ~~consisting~~Condensed ofConsolidated ~~normal recurring accruals, unless otherwise noted,~~Financial ~~which~~Statements ~~are necessary~~ to ~~present~~be ~~fairly~~consistent ~~the~~with ~~Company’s~~our ~~financial~~current ~~position,~~period ~~results of operations and cash flows for the periods indicated~~presentation.

6 We have evaluated the financial statements for subsequent events through the date of the filing of this Form 10-Q.

~~Table of~~New ~~Contents~~Accounting Standards

~~The~~ In ~~Company’s~~March 2008, ~~results~~the Financial Accounting Standards Board (the “FASB”) issued SFAS No. 161, of“Disclosures ~~operations~~about ~~for~~Derivative ~~interim~~Instruments ~~periods~~and ~~are~~Hedging ~~not~~Activities—an ~~necessarily~~amendment ~~indicative~~to ofFASB Statement No. 133” (“SFAS 161”). SFAS 161 changes the ~~results~~ disclosure requirements for anderivative ~~entire~~instruments ~~year~~and hedging ~~due~~activities. Entities are required to ~~seasonal~~provide ~~factors~~enhanced asdisclosures ~~well~~about as(1) how ~~competitive~~and why an entity uses derivative instruments, (2) how derivative instruments and ~~general~~related hedged items are ~~economic~~accounted ~~conditions~~for under SFAS No. ~~The~~ 133, ~~Company’s~~“Accounting for Derivative Instruments and Hedging Activities” ~~second~~(“SFAS 133”), and ~~third~~(3) how ~~quarter~~derivative ~~operating~~instruments ~~results~~and ~~have~~related ~~historically~~hedged ~~been~~items ~~more~~affect an entity’s ~~favorable~~financial ~~due~~position, tofinancial ~~increased~~performance ~~leisure~~and ~~travel~~cash onflows. ~~domestic~~SFAS ~~and~~161 ~~international~~is ~~routes during~~applicable ~~the~~for ~~spring~~fiscal years and ~~summer~~interim ~~months~~periods. We adopted SFAS 161 on January 1, 2009.

~~Certain~~ In ~~prior~~April 2009, ~~year~~the FASB issued FASB Staff Position (“FSP”) 107-1 and Accounting Principles ~~amounts~~Board ~~have~~(“APB”) ~~been~~Opinion ~~reclassified~~No. 28-1, to“Interim ~~conform~~Disclosures about Fair Value of Financial Instruments” (“FSP 107-1 and APB 28-1”). FSP 107-1 and APB 28-1 amend FASB Statement No. 107, “Disclosures about Fair Values of Financial Instruments,” to ~~the~~require ~~current~~disclosures ~~year~~about fair value of financial ~~statement~~instruments ~~presentation~~in interim financial statements as well as in annual financial statements. It also amends APB Opinion No. 28, “Interim Financial Reporting,” to require those disclosures in all interim financial statements. We adopted FSP 107-1 and APB 28-1 effective April 1, 2009.

~~Bankruptcy~~5 Claims Resolution Process. On September 14, 2005 (the “Petition Date”), NWA Corp. and 12 of its direct and indirect subsidiaries (collectively, the “Debtors”) filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”). Subsequently, on September 30, 2005, NWA Aircraft Finance, Inc., an indirect subsidiary of NWA Corp., also filed a voluntary petition for relief under Chapter 11. On May 18, 2007, the Bankruptcy Court entered an order approving and confirming the Debtors’ First Amended Joint and Consolidated Plan of Reorganization Under Chapter 11 of the Bankruptcy Code (as confirmed, the “Plan” or “Plan of Reorganization”). The Plan became effective and the Debtors emerged from bankruptcy protection on May 31, 2007 (the “Effective Date”). On the Effective Date, the Company implemented fresh-start reporting in accordance with the American Institute of Certified Public Accountants Statement of Position 90-7, Financial Reporting by Entities in Reorganization Under the Bankruptcy Code (“SOP 90-7”).

PursuantTable to terms of the Plan of Reorganization, approximately 225.8 million shares of the Pre-Merger Company’s common stock will be issued to holders of allowed general unsecured claims and 8.6 million shares will be issued to holders who also held a guaranty claim from the Debtors. Once a claim is allowed consistent with the claims resolution process as provided in the Plan, the claimant is entitled to a distribution of new common stock. Pursuant to the terms of the Merger Agreement, each outstanding share of Northwest common stock (including shares issuable pursuant to Northwest’s Plan of Reorganization) was converted into and became exchangeable for 1.25 shares of Delta common stock. Approximately 228.0 million shares of the Pre-Merger Company’s common stock (or 285.1 million Post-Merger shares of Delta common stock) have been issued and distributed through March 31, 2009, in respect of valid unsecured and guaranty claims. In total, there are approximately 6.4 million remaining shares of the Pre-Merger Company’s new common stock (or 8.0 million Post-Merger shares of Delta common stock) held in reserve under the terms of the Plan of Reorganization.Contents

~~The Company~~NOTE ~~estimates that its unsecured claims to be allowed will not exceed $8.~~2 ~~billion~~. ~~Differences~~ ~~between~~FAIR ~~claim amounts~~VALUE ~~filed and the Company’s estimates are being investigated and will be~~MEASUREMENTS resolved in connection with the claims resolution process. However, there will be no further financial impact to the Company associated with the settlement of such unsecured claims, as the holders of all allowed unsecured claims against the Pre-Merger Company will receive, under the Plan of Reorganization, Delta common stock based on the pro-rata amount of Northwest shares held in reserve. Secured claims were deemed unimpaired under the Plan and were satisfied upon either reinstatement of the obligations in the Pre-Merger Company, surrendering the collateral to the secured party, or by making full payment in cash.

7 SFAS No. 157, “Fair Value Measurements” (“SFAS 157”), defines fair value, establishes a consistent framework for measuring fair value and expands disclosure for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis. SFAS 157 clarifies that fair value is an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Accordingly, fair value is a market-based measurement that is determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, SFAS 157 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

~~Table~~• ofLevel ~~Contents~~1. Observable inputs such as quoted prices in active markets; • Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and • Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.

~~Note~~Assets 2and –Liabilities ~~Goodwill~~Measured ~~and~~at ~~Intangibles~~Fair Value on a Recurring Basis

The Company determined that the announced Merger on April 14, 2008 (the “Announcement Date”) was a triggering event under SFAS No. 142, requiring the Company to further evaluate the carrying value of its goodwill. As a result of this evaluation, the Company recorded a net goodwill impairment charge of $3.2 billion during the first and second quarters of 2008 to reduce the book value of Northwest’s equity to its implied fair value as of the Announcement Date. Based on the 5-day average closing price of Delta’s common stock around the Announcement Date, the right to receive 1.25 shares of Delta stock for each share of NWA Corp. common stock, and the projected number of NWA Corp.’s common shares to be converted into Delta common stock on the Closing Date, the implied fair value of NWA Corp.’s equity on the Announcement Date was $3.35 billion. Additionally, Northwest recorded a net $1.1 billion of impairment charges in the second quarter of 2008 related to certain flight equipment, definite-lived and indefinite-lived intangible assets, investments in affiliated companies, and the related deferred tax effects.


						Significant
				Quoted Prices		Other			Significant
				in Active		Observable			Unobservable
	June 30,			Markets		Inputs			Inputs
(in millions)	2009			(Level 1)		(Level 2)			(Level 3)

Cash equivalents	$	2,500		$	2,500	$	—		$	—
Short-term investments		21			—		—			21
Restricted cash equivalents		109			109		—			—
Long-term investments		45			—		—			45
Hedge derivatives liability, net		(54	)		—		(5	)		(49	)

~~The~~ We ~~Company~~record ~~recorded~~our acash ~~goodwill~~equivalents ~~impairment charge of $3.9 billion for the quarter ended March 31, 2008. Northwest finalized the impairment tests of goodwill~~ and ~~long~~short-~~lived~~term ~~assets~~investments ~~during~~at ~~the second quarter of 2008, resulting in an additional net charge of $547 million, which includes an adjustment of~~ estimated ~~goodwill from $2.2 billion to the implied~~ fair value ~~of goodwill of $2~~.9 ~~billion.~~ The ~~adjustment to goodwill resulted in the reversal of $674~~ ~~million~~estimated offair ~~impairment~~values ~~expense recorded in the first quarter~~ of ~~2008 which is classified as Goodwill and~~ other ~~indefinite-lived~~financial ~~intangibles impairment expense. Additionally~~instruments, ~~Northwest recorded~~including ~~$624~~derivative ~~million in depreciation and amortization related to impairment of certain flight equipment and definite-lived intangibles~~instruments, ~~$598~~have ~~million of~~been ~~impairment~~determined ~~expense~~using inavailable ~~goodwill~~market information and ~~other~~valuation ~~indefinite-lived intangibles impairment expense related to indefinite-lived intangibles~~methodologies, ~~$213~~primarily ~~million in~~discounted ~~other~~cash ~~non-operating~~flow expense related to other than temporary impairment on investments in affiliated companies and $214 million in income tax benefit related to the reversal of deferred tax liabilities related to certain of the indefinite-lived intangible assetsanalyses.

~~Adjustments~~ Valuation totechniques ~~goodwill~~for assets and liabilities in the Level 3 fair value hierarchy are based ~~during~~on the ~~three~~income ~~months~~approach ~~ended~~using ~~March~~(1) ~~31,~~a ~~2009~~discounted ~~are~~cash ~~shown~~flow inmodel ~~the~~for ~~table~~investments ~~below:~~and (2) a market and income approach using a discounted cash flow model for interest rate hedges.

(In millions)
Balance as of beginning of period	$	4,572
Adjustments related to property taxes	14
Adjustments related to deferred tax assets	(12		)
Other	(4		)
Balance as of end of period	$	4,570

Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3)

Note 3 – Fair Value Measurements


	Hedge Derivatives
(in millions)	Liability, Net

Balance at December 31, 2008	$	(549	)
Change in fair value included in earnings		(77	)
Change in fair value included in other comprehensive income		107
Purchases and settlements, net		470

Balance at June 30, 2009	$	(49	)

~~SFAS~~ Losses ~~No. 157,~~included ~~Fair~~in ~~Value Measurements~~earnings ~~(“SFAS~~above ~~No. 157”) defines fair value, establishes a consistent framework~~ for ~~measuring~~the ~~fair~~six ~~value~~months ~~and~~ended ~~expands disclosure requirements for each major asset and liability category measured at fair value on either a recurring or nonrecurring basis.~~June ~~SFAS No. 157 clarifies that fair value is an exit price~~30, ~~representing~~ ~~the~~2009 ~~amount~~are ~~that~~recorded would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on ~~assumptions that~~our ~~market~~Consolidated ~~participants~~Statement ~~would~~of ~~use~~Operations ~~in pricing an asset or liability. As a basis for considering such assumptions, SFAS No. 157 establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value~~ as follows: ~~(1) Quoted~~ ~~prices in active markets for identical assets - Level 1, (2) Significant other observable inputs — Level 2, and (3) Significant unobservable inputs — Level 3.~~

The valuation techniques that may be used to measure fair value are described below:


	Fuel Expense and			Other (Expense)
(in millions)	Related Taxes			Income

Total losses included in earnings	$	(76	)	$	(1	)

Change in unrealized losses relating to liabilities still held at June 30, 2009	$	—		$	(1	)

~~(A) Market approach – Uses prices~~6 and other relevant information generated by market transactions involving identical or comparable assets or liabilities. Prices may be indicated by pricing guides, sale transactions, market trades, or other sources;

(B) CostTable approach – Based on the amount that currently would be required to replace the service capacity of an asset (replacement cost); andContents

~~(C) Income~~Fair ~~approach~~Value – Uses valuation techniques to convert future amounts to a single present amount based on current market expectations about the future amounts (includes present value techniques, option-pricing models, and excess earnings method). Net present value is an income approach where a stream of ~~expected cash flows is discounted at an appropriate market interest~~Debt ~~rate. Excess earnings method is a variation of the income approach where the value of a specific asset is isolated from its contributory assets.~~

8 Market risk associated with our fixed and variable rate long-term debt relates to the potential reduction in fair value and negative impact to future earnings, respectively, from an increase in interest rates. The following table presents information about the fair value of our debt at June 30, 2009 and December 31, 2008:

Table of Contents


	June 30,			December 31,
(in millions)	2009			2008

Total debt at par value	$	6,937		$	7,353
Unamortized discount, net		(1,498	)		(1,678	)

Net carrying amount	$	5,439		$	5,675

Fair value⁽¹⁾	$	5,926		$	5,195

~~Measured~~(1) onThe aaggregate ~~Recurring~~fair ~~Basis. For~~value ~~assets~~of ~~and~~our ~~liabilities~~debt ~~measured~~was atbased ~~fair value~~primarily on areported ~~recurring~~market ~~basis~~values ~~during~~and ~~the~~recently ~~period,~~completed ~~SFAS~~market Notransactions. ~~157 requires quantitative disclosures about the fair value measurements separately for each major category.~~

~~Assets and~~NOTE ~~liabilities~~3. ~~itemized~~RISK ~~below~~MANAGEMENT ~~were~~AND ~~measured~~FINANCIAL ~~at fair value during the period~~INSTRUMENTS ~~using the market and income approaches:~~

Post-Merger

Assets

Quoted

Prices

in Active

Significant

Markets for

Other

Significant

As of

Identical

Observable

Unobservable

March

Assets

Inputs

(In millions)

31, 2009

(Level 1)

(Level 2)

(Level 3)

Cash and cash equivalents

2,548

N/A

Unrestricted short-term investments

N/A

Restricted cash, cash equivalents, and short-term investments

168

N/A

Long-term investments

N/A

Hedge derivatives asset - current

N/A

Hedge derivatives asset - long-term

N/A

—

Total

2,800

2,716

Aircraft Fuel Price Risk

Post-Merger

Liabilities

Quoted

Prices

in Active

Significant

Markets for

Other

Significant

As of

Identical

Observable

Unobservable

March

Assets

Inputs

(In millions)

31, 2009

(Level 1)

(Level 2)

(Level 3)

Hedge derivatives liability - current

168

N/A

162

Hedge derivatives liability - long-term

N/A

—

Total

218

N/A

212

Our results of operations are materially impacted by changes in aircraft fuel prices, interest rates and foreign currency exchange rates. In an effort to manage our exposure to these risks, we periodically enter into various derivative instruments, including fuel, interest rate and foreign currency hedges. In accordance with SFAS 133, we are required to recognize all derivative instruments as either assets or liabilities at fair value on our Consolidated Balance Sheets and to recognize certain changes in the fair value of derivative instruments on our Consolidated Statements of Operations.

~~Valuation~~ We ~~techniques~~also ~~for assets~~participate ~~and~~in ~~liabilities~~a ~~within~~fuel ~~the~~hedge ~~level~~program 3sponsored ~~hierarchy~~by ~~are~~Delta, ~~based~~whereby onDelta ~~the~~enters ~~income~~into fuel ~~approach~~hedges ~~using~~to ~~(1)~~manage athe ~~discounted~~price ~~cash~~risk ~~flow~~of ~~model~~fuel ~~for~~costs associated with the ~~Reserve~~estimated ~~Primary~~consolidated ~~Fund~~fuel consumption of Delta and ~~auction~~us. ~~rate~~In ~~securities~~association with the terms of this program, ~~(2)~~Delta anrecords ~~option~~the ~~pricing~~fair value ~~model~~of ~~for~~all related fuel ~~hedge~~hedges ~~option contracts~~on ~~and~~its ~~(3)~~Consolidated Balance Sheets, and a ~~market~~pro-rata ~~approach~~percentage ~~for~~of the ~~interest~~hedge ~~rate~~gains ~~cash~~or ~~flow~~losses ~~hedges~~are allocated to us based on fuel consumption and recorded on our Consolidated Statements of Operations.

~~A reconciliation~~ We perform, at least quarterly, both a prospective and retrospective assessment of the effectiveness ~~beginning~~of ~~and~~our ~~ending~~hedge ~~balances~~contracts, including assessing the possibility of ~~assets~~counterparty ~~and~~default. If ~~liabilities~~we determine that a derivative is no longer expected to be highly effective, we discontinue ~~measured~~hedge ataccounting prospectively and recognize subsequent changes in the fair value onof the hedge in earnings. As a ~~recurring~~result ~~basis~~of ~~using~~our ~~Level~~effectiveness 3assessment ~~inputs~~at isJune 30, ~~presented~~2009, we believe our hedge contracts will continue to be highly effective in offsetting changes in cash flow attributable to the ~~table~~hedged ~~below:~~risk.

	Post-Merger
	Assets					Liabilities
	Level 3					Level 3
	Unrestricted					Hedge
	Short-Term			Long-Term		Derivatives
(In millions)	Investments			Investments		Liability, Net
Balance as of January 1, 2009	$	49		$	38	$	549
Purchases, sales, and settlements (net)	(16		)	—		(289		)
Unrealized loss (gain) recorded in AOCI	—			—		(48		)
Transfer to long-term investments	(17		)	17		—
Balance as of March 31, 2009	$	16		$	55	$	212

9Table of Contents

~~Table of~~Cash ~~Contents~~flow hedges

~~Measured~~ For ~~on a~~derivative ~~Non-Recurring~~instruments ~~Basis. For~~that ~~assets~~are designated and ~~liabilities~~qualify ~~measured~~as cash flow hedges under SFAS 133, the effective portion of the gain or loss on the derivative is reported as a component of ~~non-recurring~~accumulated ~~basis~~other ~~during~~comprehensive income and reclassified into earnings in the same period, ~~SFAS~~during which Nothe hedged transaction affects earnings. ~~157~~ ~~requires~~The ~~quantitative~~effective portion of the derivative represents ~~disclosures~~the ~~about~~change in fair value of the hedge that offsets the change in fair value ~~measurements~~of ~~separately~~the ~~for~~hedged ~~each~~item. ~~major~~To ~~category. During~~the extent the ~~first~~change ~~quarter~~in the fair value of ~~2009,~~ the ~~Company~~hedge ~~did~~does not ~~remeasure~~perfectly ~~assets~~offset orthe ~~liabilities~~change atin the fair value onof athe hedged item, the ineffective portion of the hedge is immediately recognized in ~~non-recurring~~other ~~basis~~(expense) income on our Consolidated Statements of Operations. The following table summarizes the accounting treatment and classification of our cash flow hedges on our Condensed Consolidated Financial Statements:

In March 2008, as part of a revised fleet plan, the Company determined that it would remove three Boeing 747F aircraft and two DC9-30 aircraft from scheduled service during the remainder of 2008 and the first quarter of 2009. As a result, the Company recorded, as additional depreciation expense, impairment charges of $17.2 million associated with these aircraft and related inventory during the first quarter of 2008.


		Impact of Unrealized Gains and Losses
		Consolidated	Consolidated
		Balance Sheets	Income Statements
Derivative Instrument⁽¹⁾	Hedged Risk	Effective Portion	Ineffective Portion

Designated under SFAS 133:

Fuel hedges consisting of crude oil, heating oil, and jet fuel swaps, collars and call options⁽²⁾	Volatility in jet fuel prices	Effective portion of hedge is recorded in accumulated other comprehensive income	Excess, if any, over effective portion of hedge is recorded in other (expense) income

Interest rate swaps and call options	Changes in interest rates	Entire hedge is recorded in accumulated other comprehensive income	Expect hedge to fully offset hedged risk; no ineffectiveness recorded

Foreign currency forwards and collars	Fluctuations in foreign currency exchange rates	Entire hedge is recorded in accumulated other comprehensive income	Expect hedge to fully offset hedged risk; no ineffectiveness recorded

Not qualifying or not designated under SFAS 133:

Fuel hedges consisting of crude oil, heating oil and jet fuel extendable swaps and three- way collars	Volatility in jet fuel prices	Entire amount of change in fair value of hedge is recorded in aircraft fuel expense and related taxes

The Company also recorded a goodwill impairment charge in other operating expense to reduce the book value of Northwest’s equity to its implied fair value as of the Announcement Date. The goodwill measurement described below was an estimate and was adjusted based on the completion of Step 2 of the goodwill impairment test during the second quarter of 2008, as described more fully in “Note 2 — Goodwill and Intangibles.” The assets itemized below were measured at fair value on a non-recurring basis during the first quarter of 2008 using a market approach:


⁽¹⁾		In the Merger, Delta assumed our outstanding hedge contracts, which include fuel, interest rate and foreign currency cash flow hedges. On the Closing Date, Delta designated certain of these contracts as hedges in accordance with SFAS 133. The remaining derivative contracts that were not designated under SFAS 133 did not qualify for hedge accounting.

⁽²⁾		Ineffectiveness on our fuel hedge option contracts is calculated using a “perfectly effective” hypothetical derivative, which acts as a proxy for the fair value of the change in expected cash flows from the purchase of aircraft fuel.

	Successor Assets
				Quoted Prices
				in Active		Significant
				Markets for		Other
				Identical		Observable		Total
	Month of	Fair Value		Assets		Inputs		Gains
(In millions)	Measurement	Measurement		(Level 1)		(Level 2)		(Losses)
Flight equipment spare parts	March 2008	$	—	$	—	$	—	$	(2	)
Flight equipment, net	March 2008	4		—		4		(15		)
Goodwill	March 2008	2,199		—		2,199		(3,917		)
								$	(3,934	)

NoteTable 4of — Derivative Financial InstrumentsContents

InHedge ~~March 2008, the FASB issued SFAS No. 161,~~Position Disclosures about Derivative Instruments and Hedging Activities—an amendment to FASB Statement No. 133 (“SFAS No. 161”). SFAS No. 161 changes the disclosure requirements for derivative instruments and hedging activities. Entities are required to provide enhanced disclosures about (1) how and why an entity uses derivative instruments, (2) how derivative instruments and related hedged items are accounted for under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities (“SFAS No. 133”), and (3) how derivative instruments and related hedged items affect an entity’s financial position, financial performance and cash flows. SFAS No. 161 is effective for fiscal years and interim periods beginning after November 15, 2008. The Company adopted SFAS No. 161 on January 1, 2009.

~~Our~~ The ~~results~~following oftables ~~operations~~reflect ~~are~~the ~~materially~~estimated ~~impacted~~fair ~~by changes~~value ingain ~~aircraft~~(loss) position ~~fuel~~of ~~prices, interest rates and foreign currency exchange rates. In an effort to manage~~ our ~~exposure~~ ~~to these risks, we periodically enter into various derivative~~hedge ~~instruments,~~contracts ~~including~~at ~~fuel~~June 30, ~~interest~~2009 ~~rate~~ and ~~foreign currency hedges. In accordance with SFAS No.~~December ~~133~~31, ~~we are~~2008: required to recognize all derivative instruments as either assets or liabilities at fair value on our Condensed Consolidated Balance Sheets and to recognize certain changes in the fair value of derivative instruments on our Condensed Consolidated Statements of Operations.

We believe our hedge contracts will be highly effective during their term in offsetting changes in cash flow or fair value attributable to the hedged risk. We perform, at least quarterly, both a prospective and retrospective assessment of the effectiveness of our hedge contracts, including assessing the possibility of counterparty default. If we determine that a derivative is no longer expected to be highly effective, we discontinue hedge accounting prospectively and recognize subsequent changes in the fair value of the hedge to earnings. As a result of our effectiveness assessment at March 31, 2009, we believe our derivative contracts that are designated and qualify for hedge accounting under SFAS No. 133 will continue to be highly effective in offsetting changes in cash flow or fair value attributable to the hedged risk.


	June 30, 2009
				Prepaid
				Expenses		Other					Hedge			Other
	Notional		Maturity	and Other		Noncurrent		Accounts			Derivatives			Noncurrent
(in millions, unless otherwise stated)	Balance		Date	Assets		Assets		Payable			Liability			Liabilities


Designated under SFAS 133

Fuel hedge swaps, collars and call options⁽¹⁾				$	—	$	—	$	(10	)	$	—		$	—

Interest rate swaps and caps designated as cash flow hedges	$	1,700	December 2009 - May 2019		—		1		—			(36	)		(14	)

Foreign currency exchange forwards and collars	79.8 billion Japanese Yen, 61.0 million Canadian Dollars		July 2009 - April 2012		4		5		—			(11	)		(5	)

Total designated under SFAS 133					4		6		(10	)		(47	)		(19	)
Not designated under SFAS 133
Fuel hedge swaps and collars					—		—		(17	)		(14	)		—

Total not designated under SFAS 133					—		—		(17	)		(14	)		—

Total derivative instruments				$	4	$	6	$	(27	)	$	(61	)	$	(19	)

⁽¹⁾ All contracts assumed in the Merger were settled by June 30, 2009.


	December 31, 2008
							Hedge			Other
	Notional		Maturity	Accounts			Derivatives			Noncurrent
(in millions, unless otherwise stated)	Balance		Date	Payable			Liability			Liabilities


Designated under SFAS 133

Fuel hedge swaps, collars and call options	173 million gallons - crude oil		January - June 2009	$	—		$	(163	)	$	—

Interest rate swaps and call options designated as cash flow hedges	$	1,700	December 2009 - May 2019		—			(32	)		(63	)

Foreign currency exchange forwards and collars	45.0 billion Japanese Yen		January - December 2009		—			(48	)		—

Total designated under SFAS 133					—			(243	)		(63	)
Not designated under SFAS 133
Fuel hedge swaps and collars	180 million gallons - crude oil, heating oil, jet fuel		January - June 2009		(119	)		(318	)		—

Total not designated under SFAS 133					(119	)		(318	)		—

Total derivative instruments				$	(119	)	$	(561	)	$	(63	)

~~Table~~9 ~~of Contents~~

CashTable flow hedges. For derivative instruments that are designated and qualify as cash flow hedges under SFAS No. 133, the effective portion of the gain or loss on the derivative is reported as a component of Accumulated other comprehensive (loss) income (“OCI”) and reclassified into earnings in the same period during which the hedged transaction affects earnings. The effective portion of the derivative represents the change in fair value of the hedge that offsets the change in fair value of the hedged item. To the extent the change in the fair value of the hedge does not perfectly offset the change in the fair value of the hedged item, the ineffective portion of the hedge is immediately recognized in Other income (expense) on our Condensed Consolidated Statements of Operations. The following table summarizes the accounting treatment and classification of our cash flow hedges on our Condensed Consolidated Financial Statements:Contents

		Impact of Unrealized Gains and Losses
		Condensed Consolidated	Condensed Consolidated
		Balance Sheets	Statements of Operations
Derivative Instrument (1)	Hedged Risk	Effective Portion	Ineffective Portion
Designated under SFAS No. 133:
Fuel hedges consisting of crude oil, heating oil, and jet fuel swaps, collars and call options	Volatility in jet fuel prices	Effective portion of hedge is recorded in Accumulated other comprehensive income	Excess, if any, over effective portion of hedge is recorded in Other income (expense)
Interest rate swaps and call options	Changes in interest rates	Entire hedge is recorded in Accumulated other comprehensive income	Expect hedge to fully offset hedged risk; no ineffectiveness recorded
Foreign currency forwards and collars	Foreign currency exchange rate fluctuations	Entire hedge is recorded in Accumulated other comprehensive income	Expect hedge to fully offset hedged risk; no ineffectiveness recorded
Not qualifying or not designated under SFAS No. 133:
Fuel hedges consisting of crude oil, heating oil, and jet fuel swaps, and three-way collars	Volatility in jet fuel prices	Entire amount of change in fair value of hedge is recorded in Aircraft fuel and related taxes expense

Hedge Gains (Losses)

Gains (1losses) ~~Ineffectiveness~~ recorded on ~~fuel~~our ~~hedge~~Condensed ~~option~~Consolidated ~~contracts is~~Financial ~~calculated~~Statements ~~using~~for athe ~~“perfectly~~three months ~~effective”~~ended ~~hypothetical derivative~~June 30, ~~which~~2009 ~~acts as~~and a2008 ~~proxy~~related ~~for~~to ~~the~~our ~~fair~~hedge ~~value~~contracts ofdesignated ~~the~~under ~~change~~SFAS in133 ~~expected~~are ~~cash flows from the~~as ~~purchase of aircraft fuel.~~follows:

The following tables reflect the estimated fair value gain (loss) position of our hedge derivatives at March 31, 2009:


	Post-Merger			Pre-Merger		Post-Merger			Pre-Merger			Post-Merger			Pre-Merger
						Effective Portion Reclassified
	Effective Portion Recognized					from Accumulated Other						Ineffective Portion Recognized
	in Other Comprehensive Loss					Comprehensive Loss to Earnings						in Other (Expense) Income
	Three Months Ended June 30,					Three Months Ended June 30,						Three Months Ended June 30,
(in millions)	2009			2008		2009			2008			2009			2008

Designated under SFAS 133
Fuel hedge swaps, collars and call options⁽¹⁾	$	25		$	—	$	(19	)⁽⁴⁾	$	—		$	19	⁽⁴⁾	$	—
Interest rate swaps and call options designated as cash flow hedges⁽²⁾		35			36		(1	)		—			—			—
Foreign currency exchange forwards and collars⁽³⁾		(19	)		47		(2	)		(4	)		—			—

Total designated under SFAS 133	$	41		$	83	$	(22	)	$	(4	)	$	19		$	—

	Estimated Fair Value Gain (Loss)
(1)	Gains and losses on fuel hedge contracts reclassified from accumulated other comprehensive loss are recorded in aircraft fuel and related taxes.
					Accounts
(2)	Losses on interest rate swaps and call options reclassified from accumulated other comprehensive loss are recorded in interest expense.
	Prepaid		Other		Payable			Hedge			Other			Hedge
(3)	Losses on foreign currency exchange contracts reclassified from accumulated other comprehensive loss are recorded in passenger and cargo revenue.
	Expenses		Noncurrent		and Other			Derivatives			Noncurrent			Margin
(4)	Includes losses of $6 million and gains of $18 million recorded in aircraft fuel and related taxes and other (expense) income, respectively, related to hedge contracts allocated from Delta.
(In millions)	and Other		Assets		Liabilities			Liability			Liabilities			Receivable (1)
Fuel hedge swaps, collars and call options
Hedges designated under SFAS No. 133	$	—	$	—	$	(36	)	$	(58	)	$	—
Undesignated hedges	63		—		(89		)	(134		)	—
Total fuel hedge swaps, collars and call options	$	63	$	—	$	(125	)	$	(192	)	$	—
Interest rate swaps and caps designated as cash flow hedges	—		—		—			(33		)	(50		)
Foreign currency forwards and collars	3		10		—			(6		)	—
Total hedge derivatives	$	66	$	10	$	(125	)	$	(231	)	$	(50	)	$	179

Gains (1losses) ~~Represents~~ recorded ~~the~~on ~~margin~~our ~~postings~~Condensed ~~associated~~Consolidated ~~with~~ Financial Statements for the ~~open~~six ~~position~~months ended ofJune 30, ~~our~~2009 ~~fuel~~and ~~hedge~~2008 ~~derivative~~related to our hedge contracts ~~and~~designated ~~fuel~~under ~~hedge~~SFAS ~~contract settlements~~133 ~~payable.~~are as follows:


	Post-Merger		Pre-Merger		Post-Merger			Pre-Merger			Post-Merger			Pre-Merger
					Effective Portion Reclassified
	Effective Portion Recognized				from Accumulated Other						Ineffective Portion Recognized
	in Other Comprehensive Loss				Comprehensive Loss to Earnings						in Other (Expense) Income
	Six Months Ended June 30,				Six Months Ended June 30,						Six Months Ended June 30,
(in millions)	2009		2008		2009			2008			2009			2008

Designated under SFAS 133
Fuel hedge swaps, collars and call options⁽¹⁾	$	71	$	—	$	(88	)⁽⁴⁾	$	—		$	16	⁽⁴⁾	$	—
Interest rate swaps and call options designated as cash flow hedges⁽²⁾		47		20		(1	)		—			—			—
Foreign currency exchange forwards and collars⁽³⁾		36		8		2			(9	)		—			—

Total designated under SFAS 133	$	154	$	28	$	(87	)	$	(9	)	$	16		$	—

Table of Contents


⁽¹⁾		Gains and losses on fuel hedge contracts reclassified from accumulated other comprehensive loss are recorded in aircraft fuel and related taxes.

⁽²⁾		Losses on interest rate swaps and call options reclassified from accumulated other comprehensive loss are recorded in interest expense.

⁽³⁾		Losses on foreign currency exchange contracts reclassified from accumulated other comprehensive loss are recorded in passenger and cargo revenue.

⁽⁴⁾		Includes losses of $13 million and gains of $16 million recorded in aircraft fuel and related taxes and other (expense) income, respectively, related to hedge contracts allocated from Delta.

~~Hedge Margin. In~~ We ~~accordance~~recorded ~~with~~a ~~our~~gain ~~fuel~~of ~~hedge agreements,~~$8 ~~counterparties~~million ~~may~~and ~~require~~a usloss toof ~~fund~~$15 million ~~the~~to ~~margin~~aircraft ~~associated with~~fuel ~~our~~and ~~loss~~related ~~position~~ taxes on ~~these~~our ~~contracts. The~~Consolidated ~~amount~~Statements of ~~the~~Operations ~~margin,~~for ifthe ~~any,~~three isand ~~periodically~~six ~~adjusted~~months ~~based~~ended onJune 30, ~~the~~2009 ~~fair~~related ~~value~~to ofour ~~the~~derivative ~~fuel hedge~~ contracts~~. The~~ ~~margin~~that ~~requirements~~were ~~are~~not ~~intended~~designated toas hedges ~~mitigate~~under aSFAS ~~party’s~~133. ~~exposure~~We expect to ~~market~~ ~~volatility~~reclassify ~~and~~$31 million ~~the~~in ~~associated~~unrealized ~~contracting~~gains ~~party~~recorded ~~risk. We~~in doaccumulated ~~not~~other comprehensive ~~offset~~loss ~~margin~~on ~~funded~~Delta’s ~~to counterparties~~Consolidated ~~against~~Balance ~~fair~~Sheet ~~value~~into ~~amounts~~our ~~recorded~~Consolidated ~~for~~Statement ~~our~~of Operations ~~hedge~~during ~~contracts~~the next 12 months.

~~The fuel hedge margin we provide to counterparties is~~10 recorded in Hedge margin receivable on our Condensed Consolidated Balance Sheets. All cash flows associated with purchasing and settling fuel hedge contracts are classified as operating cash flows on our Condensed Consolidated Statements of Cash Flows.

ForeignTable Currency. The Company is exposed to the effect of foreign currency exchange rate fluctuations on the U.S. dollar value of foreign currency-denominated operating revenues and expenses. The Company’s largest exposure comes from the Japanese Yen and Canadian Dollar. From time to time, the Company uses financial instruments such as forward contracts, collars, or put options to hedge its anticipated foreign currency sales. The changes in market value of such instruments have historically been highly effective at offsetting exchange rate fluctuations. Hedging gains or losses are recorded in Accumulated other comprehensive (loss) income until the associated transportation is provided, at which time they are recognized as an increase or decrease in revenue.Contents

~~Counterparties~~Credit ~~to these financial instruments expose the Company to~~Risk credit loss in the event of nonperformance, but the Company does not expect any of the counterparties to fail to meet their obligations. The amount of such credit exposure is generally the unrealized gains, if any, in such contracts. To manage credit risks, the Company selects counterparties based on credit ratings, limits exposure to any single counterparty and monitors the market position with each counterparty. It is the Company’s practice to participate in foreign currency hedging transactions with a maximum span of 36 months.

As To ofmanage ~~March 31,~~credit ~~2009~~risk associated with our aircraft fuel price, ~~our~~interest ~~open~~rate and foreign currency ~~hedge~~hedging programs, ~~positions~~counterparties ~~for~~are ~~the~~selected ~~years~~based ~~ending~~on ~~December 31,~~their credit ratings and exposure is limited to any one ~~2009~~counterparty. ~~through~~The ~~2011~~market ~~were~~position asof ~~follows:~~these programs and relative market position with each counterparty are also monitored.

	Remainder								Contract Fair Value (USD)
(In millions)	of 2009		2010		2011		Total		Assets		Liabilities			Total
Amount of Yen denominated sales hedged:
Forward contracts	¥	30,600	¥	27,040	¥	20,280	¥	77,920	$	13	$	(5	)	$	8
Collars	4,500		—		—		4,500		—		(1		)	(1		)
Total	¥	35,100	¥	27,040	¥	20,280	¥	82,420	$	13	$	(6	)	$	7

In accordance with our hedge agreements, (1) we may require counterparties to fund the margin associated with our gain position on hedge contracts and (2) counterparties may require us to fund the margin associated with our loss position on these contracts. The amount of the margin, if any, is periodically adjusted based on the fair value of the hedge contracts. The margin requirements are intended to mitigate a party’s exposure to market volatility and the associated contracting party risk. We do not offset margin funded to counterparties or margin funded to us by counterparties against fair value amounts recorded for our hedge contracts.

					Average Hedged Rate
	Remainder				Call Options/
	of 2009	2010	2011	Total	Forwards		Put
Percentage of Yen denominated sales hedged:
Forward contracts	30.2%	21.0%	15.7%	21.7%	¥	96.94	n/a
Collars	4.5%	—	—	1.3%	¥	99.52	¥	103.50
Total	34.7%	21.0%	15.7%	23.0%

The hedge margin we receive from counterparties is recorded, as appropriate, in cash and cash equivalents or restricted cash, with the offsetting obligation in accounts payable on our Consolidated Balance Sheets. The margin we provide to counterparties is recorded in hedge margin receivable or restricted cash on our Consolidated Balance Sheets. All cash flows associated with purchasing and settling fuel hedge contracts are classified as operating cash flows on our Condensed Consolidated Statements of Cash Flows.

12 In accordance with our interest rate and foreign currency hedge agreements, which qualify as cash flow hedges, the respective counterparties are not required to fund margin to us and we are not required to fund margin to them.

~~Table~~ Our accounts receivable are generated largely from the sale of passenger airline tickets and cargo transportation services. The majority of ~~Contents~~these sales are processed through major credit card companies, resulting in accounts receivable that may be subject to certain holdbacks by the credit card processors.

~~Gains~~ We ~~(losses)~~also ~~recorded~~have onreceivables from the sale of mileage credits under our ~~Condensed~~WorldPerks ~~Consolidated~~Programs ~~Statements~~to participating ofairlines and non-airline businesses such as credit card companies, hotels and car ~~Operations~~rental ~~for~~agencies. We believe the ~~three~~credit ~~months~~risk ~~ended~~associated ~~March 31,~~with ~~2009~~these ~~related~~receivables tois ~~our~~minimal and that ~~foreign~~the ~~currency~~allowance ~~hedge~~for ~~contracts~~uncollectible ~~were~~accounts asthat ~~follows:~~we have provided is appropriate.

	OCI Balance					Effective Portion			OCI Balance
	as of			Effective Portion		Reclassified			as of
	December 31,			Recorded in		from OCI into			March 31,
(In millions)	2008			OCI		Revenue (1)			2009
Type of Hedge:
Settled Yen hedge contracts
Forwards	$	2		$	—	$	(2	)	$	—
Collars	(1		)	3		(2		)	—
Unsettled Yen hedge contracts
Forwards	(20		)	41		—			21
Collars	(3		)	4		—			1
Total	$	(22	)	$	48	$	(4	)	$	22

NOTE 4. DEBT

~~(1) Amounts~~Credit ~~recorded to revenue are allocated between Passenger revenue and~~Facilities ~~Cargo revenue on the Company’s Condensed Consolidated Statements of Operations.~~

~~During~~ We are party to a $904 million senior corporate credit facility (the ~~first~~“Bank ~~quarter~~Credit ofFacility”) and a $500 million revolving credit facility (the “$500 Million Revolving Credit Facility”). The Bank Credit Facility was fully drawn at June 30, 2009 and December 31, ~~ineffectiveness~~2008. ~~related~~We todid not have any outstanding borrowings under the ~~Company’s~~$500 ~~yen~~Million ~~hedges~~Revolving ~~was~~Credit ~~immaterial~~Facility at June 30, 2009 or December 31, 2008.

The ~~Company~~final ~~expects~~maturity ~~to reclassify~~date for borrowings under the Bank Credit Facility and the $12500 ~~million~~Million Revolving inCredit ~~unrealized~~Facility ~~gains~~is ~~from~~the ~~OCI~~earlier of (1) the date that Northwest Airlines, Inc. is no longer a separate legal entity, including when it is merged with and into ~~revenue~~Delta ~~during~~Air Lines, Inc.; or (2) December 31, 2010 for the ~~next~~Bank Credit Facility, and October 29, 2009 and October 29, 2011 for the 12$300 million ~~months~~and $200 million tranches, respectively, under the $500 Million Revolving Credit Facility.

~~Aircraft Fuel~~ To integrate the operations of Delta and Northwest Airlines, Inc. ~~The~~, ~~Company~~we ismust ~~exposed~~obtain toa single operating certificate for the ~~effect~~two ~~of changes~~airlines infrom the ~~price~~Federal ~~and~~Aviation ~~availability~~Administration. ofWhen Northwest ~~aircraft~~Airlines, ~~fuel~~Inc. In ~~order~~is tono ~~provide~~longer a ~~measure~~certificated carrier, key assets of ~~control~~the ~~over price~~two ~~and~~companies ~~supply,~~would be ~~the~~combined ~~Company~~into ~~trades~~a ~~and~~single ~~ships~~entity ~~fuel~~by ~~and~~merging ~~maintains~~Northwest ~~fuel~~Airlines, ~~storage~~Inc. ~~facilities~~with toand ~~support~~into ~~its~~Delta ~~flight~~Air ~~operations~~Lines, Inc. Because Tothis ~~further~~merger ~~manage~~could occur within the ~~price~~next ~~risk~~12 months, ofwe ~~fuel~~classified ~~costs,~~borrowings under the ~~Company~~Bank ~~primarily~~Credit ~~utilizes~~Facility ~~futures~~as ~~contracts~~short-term ~~traded~~ on ~~regulated~~our ~~futures~~Consolidated ~~exchanges~~Balance Sheet at June 30, ~~swap~~2009. In March 2009, we ~~agreements~~shortened ~~and~~the ~~options~~amortization period from December 2010 to March 2010 of the fair value adjustment (debt discount) recorded during purchase accounting on this debt.

~~In accordance~~Short-Term ~~with SFAS No. 133, we record the fair value of our fuel hedge~~Obligations contracts on our Condensed Consolidated Balance Sheets. Prior to the Merger, the Company had no fuel derivative contracts outstanding that were designated for special hedge accounting treatment under SFAS No. 133, and therefore had no related unrealized gains (losses) in Accumulated other comprehensive (loss) income. On the Closing Date, certain existing fuel derivative contracts were designated as cash flow hedges which qualify for special hedge accounting treatment.

We Accounts ~~believe~~Receivable ~~these designated~~Financing. ~~fuel~~In ~~hedge~~November 2007, ~~contracts~~we ~~will~~entered beinto ~~highly~~an ~~effective~~accounts ~~during~~receivable ~~the remainder~~financing facility of ~~their~~up ~~term~~to in$150 million. ~~offsetting~~The ~~changes~~facility matures in ~~cash~~364 days ~~flow~~with ~~attributable~~annual torenewal ~~the~~provisions that ~~hedged~~could ~~risk. We~~result ~~perform~~in ~~both~~ a ~~prospective~~final ~~and retrospective~~maturity ~~assessment~~date toof ~~this~~November 29, ~~effect~~2012. atAs ~~least~~of ~~quarterly~~December 31, ~~including~~2008, ~~assessing~~$100 ~~the~~million ~~possibility~~was ofdrawn aunder ~~counterparty~~the ~~default~~facility. If weIn ~~determine that a derivative is no longer expected to be highly effective~~June 2009, we ~~discontinue~~amended ~~hedge~~the ~~accounting~~facility ~~prospectively~~ and ~~recognize subsequent~~its ~~changes~~size inwas reduced ~~fair value of the hedge~~ to ~~Other~~$100 million. ~~income~~As ~~(expense) on our Condensed Consolidated Statements~~ of ~~Operations~~June 30, ~~rather~~2009, ~~than~~$28 million ~~deferring~~was ~~such amounts~~drawn inunder ~~Accumulated~~the ~~other comprehensive (loss) income on our Condensed Consolidated Balance Sheets~~facility.

~~The Company also participates~~Covenants in a fuel hedge program sponsored by Delta, whereby Delta enters into fuel hedges to manage the price risk of fuel costs associated with the estimated consolidated fuel consumption of Delta and the Company. In association with the terms of this program, Delta records the fair value of all related fuel hedges on its Condensed Consolidated Balance Sheets, and a pro-rata percentage of the hedge gains or losses are pushed down to the Company and recorded on the Company’s Condensed Consolidated Statements of Operations. The Company expects to reclassify $61 million in unrealized losses currently recorded in OCI on Delta’s Condensed Consolidated Balance Sheets into Aircraft fuel expense and related taxes during the next 12 months.

13 We were in compliance with all covenants in our financing agreements at June 30, 2009.

~~Table~~11 ~~of Contents~~

AsTable of March 31, 2009, our open fuel hedge contract positions (including contracts held by Delta and allocated to the Company) were as follows:Contents

	Percentage
	of Remaining		Average Contract
	Projected Fuel		Rates ($/per barrel)
	Requirements				Call Options/			Contract
(In millions)	Hedged		Put		Swaps		Cap	Fair Value
Type of Hedge:
2009 Contracts
Northwest contracts
Crude oil two-way collars	5.5	%	$	90.00	$	111.68	n/a	$	(58	)
Crude oil three-way collars	3.9		117.50		134.75		168.00	(71		)
Total Northwest contracts	9.4							(129		)
Delta allocated contracts
Jet Fuel swaps	18.0		n/a		69.36		n/a	(38		)
Crude oil options	4.7		n/a		56.43		n/a	6
Heating oil swaps	4.4		n/a		67.24		n/a	(9		)
Crude oil swaps	3.8		n/a		59.37		n/a	(2		)
Heating oil options	3.7		n/a		79.73		n/a	4
Total Delta allocated contracts	34.6							(39		)
Total 2009 Contracts	44.0	%						$	(168	)
2010 Contracts
Delta allocated crude oil options	5.3	%	n/a		58.62		n/a	$	21

NOTE 5. EMPLOYEE BENEFIT PLANS

~~Gains~~Net ~~(losses)~~Periodic ~~recorded~~Benefit ~~on our Condensed Consolidated Statements of~~Cost ~~Operations for the three months ended March 31, 2009 related to our fuel hedge contracts were as follows:~~

				Effective Portion
	Recognized on			Reclassified from			Total			Ineffective Portion
	Undesignated			OCI or intercompany			Gain/(Loss)			Recognized
	Contracts as			payables into			Recognized as			in Other Income
(In millions)	Fuel Expense			Fuel Expense			Fuel Expense			(Expense)
Northwest hedge contracts
Settled fuel hedge contracts	$	(21	)	$	(62	)	$	(83	)	$	(1	)
Unsettled fuel hedge contracts	(2		)	—			(2		)	—
Total Northwest fuel hedge contracts	(23		)	(62		)	(85		)	(1		)
Delta allocated intercompany fuel hedge contracts
Settled fuel hedge contracts	—			(7		)	(7		)	—
Unsettled fuel hedge contracts	—			—			—			(2		)
Total Delta allocated fuel hedge contracts	—			(7		)	(7		)	(2		)
Total	$	(23	)	$	(69	)	$	(92	)	$	(3	)

Net periodic cost for the three months ended June 30, 2009 and 2008 includes the following components:

Gains (losses) deferred in Accumulated other comprehensive (loss) income on our Condensed Consolidated Balance Sheets for the three months ended March 31, 2009 related to our fuel hedge contracts were as follows:


	Post-Merger			Pre-Merger			Post-Merger		Pre-Merger
							Other Postretirement
	Pension Benefits						Benefits
	Three Months Ended June 30,						Three Months Ended June 30,
(in millions)	2009			2008			2009		2008

Service cost	$	1		$	6		$	4	$	6
Interest cost		138			141			10		12
Expected return on plan assets		(81	)		(140	)		—		—
Recognized net actuarial loss		5			—			1		—
Special termination and settlements		2			—			—		—

Net periodic cost	$	65		$	7		$	15	$	18

	OCI Balance						Effective Portion		OCI Balance
	as of			Effective Portion			Reclassified		as of
	December 31,			Recorded in			from OCI into		March 31,
(In millions)	2008			OCI			Fuel Expense		2009
Fuel hedge contracts settled during the period	$	(48	)	$	(14	)	$	62	$	—
Unsettled fuel hedge contracts	(23		)	(1		)	—		(24		)
Total fuel hedge contracts	$	(71	)	$	(15	)	$	62	$	(24	)

Net periodic cost for the six months ended June 30, 2009 and 2008 includes the following components:

The Company expects to reclassify the remaining unrealized losses related to fuel hedge contracts from OCI into Aircraft fuel and related taxes expense during the remainder of 2009.


	Post-Merger			Pre-Merger			Post-Merger		Pre-Merger
							Other Postretirement
	Pension Benefits						Benefits
	Six Months Ended June 30,						Six Months Ended June 30,
(in millions)	2009			2008			2009		2008

Service cost	$	3		$	11		$	8	$	12
Interest cost		276			282			19		24
Expected return on plan assets		(161	)		(280	)		—		—
Recognized net actuarial loss		9			—			1		—
Special termination and settlements		5			—			6		—

Net periodic cost	$	132		$	13		$	34	$	36

14NOTE 6. COMPREHENSIVE LOSS

~~Table~~ The following table shows the components of ~~Contents~~accumulated other comprehensive loss for the six months ended June 30, 2009:

Interest Rates. The Company’s earnings are also affected by changes in interest rates due to the impact those changes have on its interest expense from floating rate debt instruments. To manage the exposure to interest rates, the Company has entered into interest rate cap and swap hedges. The objective of the interest rate cap and swap hedges is to protect the anticipated payments of interest (cash flows) on the designated debt instruments from adverse market interest rate changes. The maturity date of each of the interest rate cap and swap hedges corresponds exactly with the maturity dates of the designated debt instruments.


	Unrecognized			Derivative			Marketable			Valuation
(in millions)	Pension Liability			Instruments			Equity Securities			Allowance			Total

Balance at December 31, 2008	$	(908	)	$	(126	)	$	(5	)	$	(600	)	$	(1,639	)
Pension adjustment		11			—			—			—			11
Changes in fair value		—			80			7			—			87
Reclassification to earnings		—			74			—			—			74
Tax effect		(4	)		(57	)		(2	)		63			—

Balance at June 30, 2009	$	(901	)	$	(29	)	$	—		$	(537	)	$	(1,467	)

~~Gains (losses) deferred in Accumulated other~~12 ~~comprehensive (loss) income on our Condensed Consolidated Balance Sheets for the three months ended March 31, 2009 related to our interest rate hedge contracts were as follows:~~

	Notional		Weighted		Post-Merger
	Amount of		Average	Maturity	Contract
(In millions)	Debt		Interest Rates	Dates	Fair Value (1)
Type of Hedge:
Interest rate swaps	$	1,349	5.4%	2009 - 2019	$	(83	)
Interest rate caps	351		2.3%	2012 - 2014	—
Total	$	1,700			$	(83	)

~~(1) As~~NOTE ~~of March 31, 2009, the Company reduced the liability for its interest rate derivative instruments based on the guidance of SFAS No~~7. ~~157, which~~ ~~states~~RESTRUCTURING ~~that~~AND ~~the~~MERGER-RELATED ~~fair value of liabilities should consider the Company’s~~ITEMS own credit risk in its determination of fair value. As a result, the Company recorded a reduction to these liabilities of $10 million, and an offsetting credit to Accumulated other comprehensive (loss) income.

	OCI Balance					Effective Portion		OCI Balance
	as of			Effective Portion		Reclassified		as of
	December 31,			Recorded in		from OCI into		March 31,
(In millions)	2008			OCI		Interest Expense		2009
Type of Hedge:
Interest rate swaps	$	(93	)	$	12	$	—	$	(81	)
Interest rate caps	(2		)	—		—		(2		)
Total	$	(95	)	$	12	$	—	$	(83	)

The following table shows charges recorded in restructuring and merger-related items on our Consolidated Statements of Operations for the three and six months ended June 30, 2009 and 2008:

During the first quarter of 2009, the Company’s interest rate hedges fully offset the hedged risk; therefore, no ineffective portion is recorded.


	Post-Merger		Pre-Merger		Post-Merger		Pre-Merger
	Three Months Ended June 30,				Six Months Ended June 30,
(in millions)	2009		2008		2009		2008

Severance and related costs	$	—	$	—	$	28	$	—
Merger-related items		31		—		56		—

Total restructuring and merger-related items	$	31	$	—	$	84	$	—

~~The~~ Severance ~~Company~~and ~~expects~~related costs primarily relates to ~~reclassify~~voluntary $1workforce ~~million~~reduction programs for U.S. non-pilot employees announced in December 2008 in which approximately 1,500 employees elected ~~unrealized~~to ~~losses~~participate. ~~from~~During ~~OCI~~the ~~into~~six ~~Interest~~months ~~expense~~ended ~~during~~June 30, 2009, we recorded $28 million associated with the ~~next~~December 2008 12workforce ~~months~~reduction program, including $6 million of special termination benefits related to retiree healthcare. We expect any additional charges to be incurred in connection with these programs will be immaterial.

15 Merger-related items relate to costs associated with integrating the operations of Northwest into Delta, including costs related to information technology, employee relocation and training, and re-branding of aircraft and stations.

~~Table~~ The following table shows the balances for these restructuring charges as of June 30, 2009, and the activity for the six months then ended. The table also shows the balances for the restructuring charges assumed in the Merger as of ~~Contents~~June 30, 2009, and the activity for the six months then ended.

Note 5 — Restructuring and Merger Related Expenses


	Liability										Liability
	Balance at		Additional		Purchase						Balance at
	December 31,		Costs and		Accounting						June 30,
(in millions)	2008		Expenses		Adjustments			Payments			2009

Severance and related cost⁽¹⁾	$	47	$	22	$	—		$	(32	)	$	37
Facilities and other⁽¹⁾		32		—		(2	)		(1	)		29

Total	$	79	$	22	$	(2	)	$	(33	)	$	66

~~During~~(1) ~~the~~The ~~first~~liability ~~quarter~~balance ofat ~~2009~~December 31, ~~the~~2008 ~~company recorded~~represents ~~the~~liabilities ~~following~~recorded ~~items~~in toconnection ~~Restructuring~~with ~~and merger related expense on~~ the ~~Condensed~~ ~~Consolidated Statements of Operation:~~Merger.

	Post-Merger
	Three Months
	Ended March 31,
(In millions)	2009
Severance and related costs (1)	$	28
Other merger related expenses (2)	25
Total restructuring and merger related expenses	$	53

We decided to ground the entire fleet of B-747-200F dedicated freighter aircraft by December 31, 2009, due to its age and inefficiency. As a result, we reviewed the fleet and related spare engines for impairment during the six months ended June 30, 2009 and concluded that no impairment existed.

~~(1) Includes~~NOTE ~~costs associated with voluntary workforce reduction programs for U~~8.S. ~~non-pilot~~BANKRUPTCY ~~employees~~CLAIMS ~~announced in December 2008. During the first quarter of 2009, the Company~~RESOLUTION recorded a $28 million charge associated with the workforce reduction program, including $6 million of special termination benefits related to retiree healthcare benefits. The portion of the charge related to the voluntary programs includes approximately 900 of the 1,500 program participants. Severance liabilities initially valued and recorded in connection with the Merger in the fourth quarter of 2008 previously contemplated the elimination of 600 positions. The Company expects any additional charges to be incurred in connection with these programs will be immaterial.

In September 2005, Northwest and substantially all of its subsidiaries (2the “Northwest Debtors”) ~~Includes~~ ~~costs~~filed ~~associated~~voluntary ~~with~~petitions ~~integrating~~for ~~the~~reorganization ~~operations~~under Chapter 11 of the Bankruptcy Code. On May 31, 2007, the Northwest ~~into~~Debtors ~~Delta,~~emerged ~~including~~from ~~costs~~bankruptcy. ~~related~~The toNorthwest ~~information~~Debtors’ ~~technology,~~First Amended ~~employee~~Joint ~~relocation~~ and ~~training~~Consolidated Plan of Reorganization (“Plan of Reorganization”) generally provides for the distribution of Northwest common stock to the Northwest Debtors’ creditors, employees and ~~re-branding~~others in satisfaction of ~~aircraft~~allowed ~~and~~general, ~~stations~~unsecured claims.

~~The following~~ Pursuant ~~table~~to ~~shows~~terms of the ~~balances~~Plan ~~for~~of ~~these~~Reorganization, ~~restructuring~~226 million ~~charges~~shares asof the Pre-Merger company’s common stock were issuable to holders of ~~March 31,~~allowed general unsecured claims and ~~2009~~eight million shares were issuable to holders who also held a guaranty claim from the Debtors. Once a claim is allowed, ~~and~~consistent with the ~~activity~~claims ~~for~~resolution process as provided in the ~~three~~Plan ~~months~~of Reorganization, ~~then~~the ~~ended. The~~claimant ~~table~~is ~~also~~entitled ~~shows~~to a distribution. Pursuant to the ~~balances~~terms ~~for~~of the Merger ~~restructuring~~Agreement, ~~charges~~each ~~related~~outstanding share of Northwest common stock (including shares issuable pursuant to the Plan of Reorganization) was converted into and became exchangeable for 1.25 shares of Delta common stock. An equivalent of 228 million shares of the Pre-Merger ascompany’s common stock (or 286 million Post-Merger shares of ~~March~~Delta common stock) have been issued and distributed through June 3130, 2009, in respect of valid unsecured and guaranty claims. In total, an equivalent of six million remaining shares of the Pre-Merger company’s new common ~~activity~~stock ~~for~~(or seven million Post-Merger shares of Delta common stock) were held in reserve under the ~~three~~terms of ~~months~~the ~~then~~Plan ~~ended~~of Reorganization.

	Liability										Liability
	Balance as of		Additional		Purchase						Balance as of
	December 31,		Costs and		Accounting						March 31,
(In millions)	2008		Expenses		Adjustments			Payments			2009
Severance and related costs (1)	$	47	$	22	$	—		$	(10	)	$	59
Facilities and other (1)	32		—		(4		)	—			28
Total	$	79	$	22	$	(4	)	$	(10	)	$	87

(1) TheTable liabilityof balance at December 31, 2008 includes liabilities recorded in connection with the Merger.Contents

~~Note~~ We 6estimate —that ~~Earnings~~our ~~(Loss)~~unsecured ~~Per~~claims ~~Share~~to ~~Data~~be allowed will not exceed $8 billion. Differences between claim amounts filed and our estimates are being investigated and will be resolved in connection with the claims resolution process. However, there will be no further financial impact to us associated with the settlement of such unsecured claims, as the holders of all allowed unsecured claims against the Pre-Merger company will receive, under the Plan of Reorganization, Delta common stock based on the pro-rata amount of Northwest shares held in reserve. Secured claims were deemed unimpaired under the Plan of Reorganization and were satisfied upon either reinstatement of the obligations in the Pre-Merger company, surrendering the collateral to the secured party, or by making full payment in cash.

OnNOTE ~~the Closing Date, the Company became a wholly owned subsidiary of Delta and the shares of NWA Corp~~9.~~, which~~ ~~traded~~LOSS ~~under~~PER ~~the symbol “NWA”, ceased trading on, and were delisted from~~SHARE ~~the NYSE. As a result, the Company is not presenting Post-Merger Company earnings (loss) per share data for the quarter ended March 31, 2009.~~

~~Pre-Merger~~ On ~~EPS. In accordance~~the ~~with~~Closing ~~SFAS No. 128~~Date, ~~Earnings per~~we ~~Share~~became ~~(“SFAS~~a ~~No. 128”),~~wholly-owned ~~basic~~subsidiary ~~and~~of ~~diluted~~Delta ~~earnings~~and ~~per share were computed by dividing~~ the ~~net loss by the weighted-average number of~~ shares of ~~common stock outstanding for the three months ended March 31~~Northwest, ~~2008. SFAS~~which ~~No. 128~~traded ~~requires~~under ~~that~~ the ~~entire~~symbol ~~234~~“NWA,” ~~million~~ceased ~~shares~~trading toon, beand ~~issued~~were todelisted ~~holders~~from, ofthe ~~unsecured~~New ~~and~~York ~~guaranty~~Stock ~~claims~~Exchange. ~~pursuant~~As toa ~~the~~result, ~~Plan~~we ofare ~~Reorganization~~not bepresenting ~~considered~~Post-Merger ~~outstanding~~company ~~for purposes of calculating earnings~~ loss per share ~~as these shares will ultimately be~~data ~~issued~~for ~~to unsecured creditors once~~ the ~~allocation~~three ofand ~~disputed~~six ~~unsecured~~months ~~claims is~~ended ~~completed~~June 30, 2009.

~~At March 31,~~ We ~~2008,~~calculated ~~approximately~~basic 16loss ~~million~~per inshare ~~restricted~~by ~~stock~~dividing ~~units~~the ~~and~~net loss ~~stock~~attributable ~~options~~ to ~~purchase~~common ~~shares~~stockholders ofby the ~~Pre-Merger~~weighted ~~Company’s~~average number of common ~~stock~~shares ~~were~~ outstanding. Shares ~~but~~issuable ~~excluded~~upon ~~from~~the satisfaction of certain conditions are considered outstanding and included in the computation of ~~diluted~~basic ~~earnings~~loss per share ~~because~~. Accordingly, the ~~effect~~calculation of ~~including~~basic loss per share for the three and six months ended June 30, 2008 assumes there was outstanding at the beginning of each of these periods all 234 million shares ~~would~~contemplated ~~have~~by ~~been~~the ~~anti-dilutive~~Plan of Reorganization to be distributed to holders of allowed unsecured and guaranty claims.

16 The following table shows our computation of basic and diluted loss per share for the three and six months ended June 30, 2008:

Table of Contents


	Three
	Months			Six Months
	Ended			Ended
	June 30,			June 30,
(in millions, except per share data)	2008			2008

Basic and diluted:
Net loss	$	(377	)	$	(4,516	)
Weighted average shares outstanding⁽¹⁾		263			263

Basic and diluted loss per share	$	(1.43	)	$	(17.19	)

~~Note~~(1) 7For -the ~~Long~~three and six months ended June 30, 2008, we excluded from our loss per share calculations all common stock equivalents because their effect was anti-~~Term~~dilutive. ~~Debt~~These common stock equivalents totaled 12 million in restricted stock units and stock options.

~~The~~NOTE ~~Company is a party to a $904 million senior corporate credit facility (the “Bank Credit Facility”) and a $500 million revolving credit facility (the “$500 Million Revolving Credit Facility”)~~10. ~~The~~ ~~Bank~~RELATED ~~Credit~~PARTY ~~Facility was fully drawn at~~TRANSACTIONS ~~March 31, 2009 and December 31, 2008. The Company did not have any outstanding borrowings under the $500 Million Revolving Credit Facility at March 31, 2009 or December 31, 2008.~~

~~The~~ Subsequent ~~final~~to ~~maturity~~the ~~date~~Merger, ~~for~~we ~~borrowings~~entered ~~under~~into ~~the~~a ~~Bank Credit~~$300 million ~~Facility~~intercompany ~~and~~credit ~~the~~facility ~~$500~~with Delta ~~Million~~(the ~~Revolving~~“Delta Credit Facility”). isOn ~~the~~February 4, ~~earlier of~~2009, ~~(1)~~we amended the ~~date~~size ~~that~~of ~~Northwest~~the isDelta noCredit Facility ~~longer~~from a$300 million ~~separate~~to ~~legal~~$750 million. ~~entity,~~During ~~including when~~the itsix ismonths ~~merged~~ended ~~with~~June 30, ~~and~~2009, ~~into~~we ~~Delta;~~drew oran additional ~~(2)~~$400 million ~~December~~for ~~31,~~a ~~2010~~total ~~for~~of ~~the~~$600 million ~~Bank Credit~~outstanding ~~Facility,~~as ~~and~~of ~~October 29~~June 30, 2009. ~~and~~Interest ~~October~~on unpaid ~~29,~~principal ~~2011~~is ~~for~~paid ~~the~~quarterly. ~~$300~~We ~~million and~~paid $~~200~~ 4 million ~~tranches,~~in ~~respectively,~~interest ~~under~~in the ~~$500~~six ~~Million~~months ~~Revolving Credit~~ended ~~Facility~~June 30, 2009.

To Certain ~~integrate~~revenue ~~the operations of Northwest~~ and ~~Delta,~~expense ~~a single~~have ~~operating~~been ~~certificate~~allocated ~~must be obtained for the two airlines~~ from ~~the Federal~~Delta ~~Aviation~~to ~~Administration. When the~~Northwest ~~single~~based ~~operating~~on ~~certificate is received,~~ key ~~assets of the two companies~~business ~~must~~activity bedrivers ~~combined~~in ~~into~~accordance ~~a single entity. In order for this to occur, Delta intends to merge Northwest~~ with ~~and into~~ Delta~~. As~~’s ofcost ~~March~~allocation ~~31, 2009, we expect this merger to occur within the next 12 months~~policy. As ~~a result~~Accordingly, ~~we reclassified~~ the ~~borrowings under~~volume ~~the Bank Credit Facility from Long-term debt and capital leases to~~of ~~Current~~intercompany ~~maturities~~receivable ~~of long-term debt~~ and ~~capital~~payable ~~lease~~transactions ~~obligations~~has onsignificantly ~~the Condensed~~increased ~~Consolidated~~since ~~Balance Sheet at March~~ December 31, ~~2009~~ 2008. In ~~addition,~~The webelow ~~shortened~~table reflects the ~~amortization period~~balances ~~from~~of ~~December~~these ~~2010~~intercompany totransactions ~~March~~as ~~2010~~ of ~~the~~June 30, ~~fair value adjustment (debt~~2009 ~~discount)~~and ~~recorded during purchase accounting on the debt~~December 31, ~~which will result in~~2008: ~~higher interest expense for the remainder of 2009.~~

Accounts Receivable Financing Facility. In November 2007, the Company entered into an accounts receivable financing facility. On December 16, 2008, the Company renewed its accounts receivable financing facility, dated November 29, 2007. This facility, originally scheduled to mature on November 28, 2008, was renewed and subsequently amended to April 2009 and the facility size was reduced from $150 million to $125 million. As of March 31, 2009, the entire $90 million available to be drawn under this facility was outstanding. While any portion of the facility remains undrawn, the Company pays a commitment fee on the undrawn amount.


	June 30,			December 31,
(in millions)	2009			2008

Accounts receivable	$	260		$	42
Accounts payable		(259	)		(27	)
Note payable to parent		(600	)		(200	)

Net payable	$	(599	)	$	(185	)

~~The Company was in compliance~~14 ~~with covenants in our financing agreements at March 31, 2009.~~

NoteTable 8of — Comprehensive Income (Loss)Contents

~~Comprehensive~~ITEM 2. ~~income~~Management’s ~~(loss)~~Discussion ~~consisted~~and Analysis of ~~the~~Financial Condition and Results of Operations. ~~following:~~

	Deferred			Pension, Other			Unrealized			Accumulated
	Gain (Loss)			Postretirement			Gain (Loss)			Other
	on Hedging			and Long-Term			on			Comprehensive
(In millions)	Activities			Disability Benefits			Investments			Income (Loss)
Balance at December 31, 2008	$	(199	)	$	(1,433	)	$	(7	)	$	(1,639	)
Before tax amount	113			6			—			119
Tax Effect	—			—			—			—
Net-of-tax amount	113			6			—			119
Balance at March 31, 2009	$	(86	)	$	(1,427	)	$	(7	)	$	(1,520	)

General Information

17 We provide scheduled air transportation for passengers and cargo throughout the United States (“U.S.”) and the world. On October 29, 2008 (the “Closing Date”), we completed our merger (the “Merger”) with a wholly-owned subsidiary of Delta Air Lines, Inc. (“Delta”), creating the world’s largest airline. As a result of the Merger, Northwest and its subsidiaries, including Northwest Airlines, Inc., became wholly-owned subsidiaries of Delta and the shares of Northwest, which traded under the symbol “NWA,” ceased trading on, and were delisted from, the New York Stock Exchange.

~~Note~~ As 9a —result ~~Pension~~of ~~and~~the ~~Other~~application ~~Postretirement~~of ~~Health~~purchase ~~Care~~accounting in accordance with Statement of ~~Benefits~~Financial Accounting Standards (“SFAS”) No. 141, “Business Combinations” (“SFAS 141”), the financial statements prior to the Closing Date are not comparable with the financial statements for periods on or after the Closing Date. References to “Post-Merger” refer to Northwest on or after the Closing Date, after giving effect to the application of purchase accounting. References to “Pre-Merger” refer to Northwest prior to the Closing Date.

~~The Company has several~~Overview defined benefit pension plans and defined contribution 401(k)-type plans covering substantially all of its employees. Northwest froze future benefit accruals for its defined benefit Pension Plans for Salaried Employees, Pilot Employees, and Contract Employees effective August 31, 2005, January 31, 2006, and September 30, 2006, respectively. Replacement coverage was provided for these employees through 401(k)-type defined contribution plans or, in the case of the International Association of Machinists and Aerospace Workers (“IAM”) represented employees, the IAM National Multi-Employer Plan.

~~Northwest~~ For ~~also~~the ~~sponsors~~June 2009 ~~various~~quarter, ~~contributory~~we ~~medical and~~reported ~~dental~~a ~~benefit~~net ~~plans~~loss ~~covering~~of ~~certain eligible retirees and their dependents~~$39 million. ~~The expected future cost of~~ ~~providing~~This ~~such~~compares ~~postretirement~~to ~~benefits~~a isJune 2008 ~~accrued~~quarter ~~over~~net ~~the~~loss ~~service lives~~ of ~~active~~ ~~employees. Retired employees are~~$377 ~~not offered Company-paid medical and dental benefits after age 64~~million, ~~with~~which ~~the exception~~included ofa ~~certain~~net ~~employees~~$548 million ~~who~~charge ~~retired~~primarily ~~prior~~related to ~~1987~~an ~~and~~impairment ~~receive lifetime Company subsidized medical and non-subsidized dental benefits. Prior to age 65, the retiree share~~ of ~~the~~ ~~cost~~intangible ofassets ~~medical~~ and ~~dental coverage is based on~~ a ~~combination~~$293 million ofgain ~~years~~related ~~of service~~to ~~and~~our ~~age~~derivative ~~at retirement~~contracts. ~~Medical~~ ~~and dental benefit plans are unfunded and costs are paid as incurred.~~

~~The~~ Total ~~Pension~~operating ~~Protection~~revenue ~~Act~~declined of27% ~~2006~~in ~~(“2006~~the ~~Pension~~June 2009 ~~Act”) allows~~quarter ~~commercial~~compared ~~airlines~~ to ~~elect~~the ~~special funding rules~~June ~~for defined~~2008 ~~benefit~~quarter ~~plans~~to ~~that are frozen~~$2. ~~The unfunded liability for a frozen defined benefit plan may be amortized over a fixed 17-year period~~6 billion. ~~The~~Total ~~unfunded~~consolidated ~~liability~~passenger isrevenue ~~defined~~declined ~~as the actuarial liability calculated using an 8.85~~28% ~~interest~~to ~~rate minus the fair market value of plan assets~~$2. ~~Northwest elected the special funding rules~~3 ~~for frozen defined benefit plans under the 2006 Pension Act effective October 1, 2006~~billion. ~~As a~~ ~~result~~Operating ofexpenses ~~this~~in ~~election (1)~~ the ~~funding~~quarter ~~waivers~~decreased ~~that~~36% ~~Northwest received for the 2003 plan~~ year-over-year ~~contributions~~to ~~were deemed satisfied under the 2006 Pension Act, and (~~$2).5 ~~the~~billion, ~~funding~~primarily ~~standard account for each Plan was~~related ~~reduced~~ to ~~zero~~lower asaircraft offuel ~~September 30,~~and ~~2006. New~~related ~~contributions~~costs ~~that~~in ~~came due under~~ the ~~2006 Pension Act funding rules~~June ~~were~~2009 ~~paid~~quarter ~~while Northwest was in bankruptcy~~ and ~~must~~impairment ~~continue~~related tocharges berecorded ~~paid~~in ~~going forward. If~~ the ~~new contributions are not paid, the future funding deficiency that would develop will be based on the regular funding rules~~June ~~rather~~2008 ~~than the special funding rules~~quarter.

~~Components~~ At ofJune 30, ~~net~~2009, ~~periodic~~we ~~benefit~~had $2.6 billion ~~cost~~in ofcash, ~~defined benefit~~cash ~~plans~~equivalents and short-term ~~defined~~investments. ~~contribution~~In ~~plan~~addition, ~~costs:~~we had $500 million in an undrawn revolving credit facility.

	Pension Benefits						Other Benefits
	Post-Merger			Pre-Merger			Post-Merger		Pre-Merger
	Three Months			Three Months			Three Months		Three Months
	Ended March 31,			Ended March 31,			Ended March 31,		Ended March 31,
(In millions)	2009			2008			2009		2008
Defined benefit plan costs
Service cost	$	2		$	6		$	4	$	6
Interest cost	138			141			9		12
Expected return on plan assets	(80		)	(140		)	—		—
Recognized net actuarial loss and other events	7			—			—		—
Net periodic benefit cost	67			7			13		18
Defined contribution plan costs	29			28			—		—
Total benefit cost	$	96		$	35		$	13	$	18

18Table of Contents

~~Table~~ Results of ~~Contents~~Operations—June 2009 and 2008 Quarters

~~Note~~Operating ~~10 — Related Party Transactions~~Revenue

~~Delta~~ Mainline ~~Air Lines, Inc~~Passenger Revenue. ~~Subsequent~~ toMainline ~~the~~passenger ~~Merger,~~revenue ~~the~~decreased ~~Company entered into a~~ $~~300~~ 836 million ~~intercompany~~due ~~credit~~to ~~facility with Delta~~ (~~the “Delta Credit Facility”~~1)~~. On February~~ ~~4, 2009,~~ the ~~Company amended~~ ~~the~~year-over-year ~~size~~decreases ofin ~~the Delta Credit Facility from $300 million to $750 million. During the first quarter 2009~~capacity, ~~the~~passenger ~~Company drew~~load anfactor ~~additional $350 million for a total of $550 million outstanding as of March 31, 2009. The Delta Credit Facility currently matures on December 21, 2009~~ and ~~bears~~passenger ~~interest~~mile ~~at the rate of~~yield ~~1.78% per annum. Interest on unpaid principal is paid quarterly. The Company paid $1.9 million in interest in the first quarter 2009. The Company had receivables of $72.5 million~~ and ~~payables of $606.3 million for a net payable position of $533.8 million as of March~~(2) ~~31,~~lower ~~2009. Included~~fuel insurcharges ~~the $606.3~~due ~~million of payables~~ to ~~Delta~~year-over-year isdecline ~~the $550 million which was drawn on the Delta Credit Facility and classified~~ in ~~Due~~fuel ~~to parent company on the Condensed Consolidated Balance Sheets~~prices. ~~The~~ ~~following is a summary of the changes in the net payable position with Delta for the period from January 1 to March 31, 2009:~~

	Post-Merger
	Three months
	Ended March 31,
(In millions)	2009
Balance at beginning of period	$	(185	)
Net cash remitted to (received from) parent	(379		)
Net intercompany (purchases) sales	30
Balance at end of period	$	(534	)

Regional carriers. Passenger revenue of regional carriers decreased $44 million to $462 million primarily due to a 22% decrease in passenger mile yield.

19 Cargo. Cargo revenue decreased $129 million to $84 million due to the effects of capacity reductions including the grounding of certain dedicated freighter B-747-200F aircraft, significantly reduced cargo yields, decreased international volume and lower fuel surcharges due to the year-over-year decline in fuel prices.

~~Table~~ Other, ofnet. ~~Contents~~Other, net revenue increased $42 million to $274 million due primarily to increased baggage handling fees.

~~Item~~Operating ~~2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.~~Expense

Overview


						Increase
	Three Months Ended June 30,					(Decrease)			Percent
(In millions)	2009		2008			from 2008			Change

Operating Expense:
Salaries and related costs	$	733	$	748		$	(15	)		(2)	%
Aircraft fuel and related taxes		599		1,185			(586	)		(49	)
Contract carrier arrangements		222		281			(59	)		(21	)
Contracted services		144		207			(63	)		(30	)
Aircraft maintenance materials and outside repairs		153		186			(33	)		(18	)
Passenger commissions and other selling expenses		124		224			(100	)		(45	)
Landing fees and other rents		131		143			(12	)		(8	)
Depreciation and amortization		126		745			(619	)		(83	)
Aircraft rent		60		56			4			7
Passenger service		62		66			(4	)		(6	)
Impairment of goodwill and other intangible assets		—		(76	)		76		NM
Restructuring and merger-related items		31		—			31		NM
Other		104		123			(19	)		(15	)

Total operating expense	$	2,489	$	3,888		$	(1,399	)		(36)	%

~~Northwest~~ Aircraft ~~Airlines~~fuel ~~Corporation (“NWA Corp.”~~ and, ~~together~~related ~~with its subsidiaries, the “Company”) is the direct parent corporation of Northwest Airlines, Inc~~taxes. ~~(“Northwest”). The Condensed~~Aircraft ~~Consolidated~~fuel ~~Financial Statements include the accounts of NWA Corp.~~ and ~~all~~related ~~consolidated~~taxes ~~subsidiaries.~~decreased $586 million ~~Substantially~~primarily ~~all~~due ~~of the Company’s results of operations are attributable~~ to ~~its~~(1) ~~operating~~$724 million ~~subsidiary,~~associated ~~Northwest,~~with ~~which~~lower ~~accounted~~average ~~for substantially~~fuel ~~all~~prices ~~of the Company’s first quarter 2009 consolidated operating revenues~~ and ~~expenses. The Company’s results of operations also include other subsidiaries of which MLT Inc.~~ (~~“MLT”~~2) is ~~the~~$143 million ~~most significant. MLT develops~~in ~~and~~lower ~~markets~~fuel ~~Worry-Free~~consumption ~~Vacations~~due ~~that~~to ~~include~~capacity ~~air transportation, hotel accommodations and car rentals~~reductions. ~~In addition~~ toThese ~~its~~decreases ~~Worry-Free~~were ~~Vacations~~partially ~~charter~~offset ~~programs,~~by ~~MLT markets and supports~~$11 ~~Northwest’s~~million ~~WorldVacations~~in ~~travel~~net ~~packages~~fuel tohedge ~~destinations~~losses ~~throughout~~for the ~~U.S., Canada,~~June 2009 ~~Mexico~~quarter, ~~the~~compared ~~Caribbean,~~to ~~Europe~~$293 million ~~and Asia, primarily on Northwest. These vacation programs,~~ in ~~addition~~net tofuel ~~providing~~hedge agains ~~competitive~~for ~~and quality tour product, increase~~ the ~~sale~~June 2008 ~~of Northwest services and promote and support new and existing Northwest destinations~~quarter. ~~The following discussion pertains primarily to Northwest and,~~ ~~where indicated, MLT.~~

On Contract ~~October 29,~~carrier ~~2008 (the “Closing Date”), Nautilus Merger Corporation (“Merger Sub”), a wholly owned subsidiary of Delta Air Lines, Inc~~arrangements. ~~(“Delta”),~~Contract ~~merged~~carrier ~~with~~arrangements ~~and~~decreased ~~into~~primarily ~~NWA~~due ~~Corp.~~to ~~(the “Merger”)~~lower infuel ~~accordance with the Agreement and Plan of Merger, dated as of April 14, 2008 (the “Announcement Date”), among Delta, Merger Sub and NWA Corp~~costs. ~~(the “Merger~~ Agreement”). As a result of the Merger, NWA Corp. and its subsidiaries became wholly-owned subsidiaries of Delta and the shares of NWA Corp., which traded under the symbol “NWA”, ceased trading on, and were delisted from, the New York Stock Exchange (“NYSE”).

As Contracted ~~a result of the application of purchase accounting in accordance with Statement of Financial Accounting Standards (“SFAS”) No~~services. ~~141,~~ ~~Business Combinations~~Contracted ~~(“SFAS~~services ~~No. 141”),~~decreased ~~the~~primarily ~~financial~~due ~~statements prior~~ to ~~October 30,~~lower ~~2008~~passenger ~~are~~and ~~not comparable with the financial statements for~~ramp ~~periods~~handling ~~on or after October 30, 2008~~costs. References to “Post-Merger” refer to the Company on or after October 30, 2008, after giving effect to the application of purchase accounting. References to “Pre-Merger” refer to the Company prior to October 30, 2008.

~~First~~ Aircraft ~~Quarter~~maintenance ~~2009~~materials ~~Results~~and outside repairs. Aircraft maintenance materials and outside repairs decreased primarily due to the decrease in capacity and related grounding of aircraft.

~~For~~ Passenger ~~the~~commission ~~quarter~~and ~~ended~~other ~~March 31,~~selling ~~2009,~~expenses. ~~the Company~~Passenger ~~recorded~~commissions aand ~~net~~other ~~loss of $183 million, which includes a $1.8 million loss~~selling ~~associated~~expenses ~~with~~decreased ~~marking-to-market~~primarily ~~out-of-period~~due ~~fuel hedges. This compares~~ to ~~a first~~the ~~quarter~~decrease ~~2008~~in ~~net loss of $4~~capacity.~~1 billion, which included a $3.9 billion~~ ~~goodwill impairment charge and a $13.4 million loss associated with marking-to-market out-of-period fuel hedges.~~

~~Operating revenues in the first quarter of 2009~~16 decreased 17.1 percent versus the first quarter of 2008 to $2.6 billion. System consolidated passenger revenue decreased 17.4 percent to $2.2 billion. Operating expenses in the quarter decreased 63.6 percent year-over-year to $2.6 billion.

AtTable March 31, 2009, the Company had cash and cash equivalents of $2.5 billion and unrestricted short-term investments of $15.6 million, providing total available liquidity of $2.6 billion. This amount excludes $167.8 million of restricted short-term investments (which may include amounts held as cash).Contents

20 Depreciation and amortization. Depreciation and amortization expenses decreased as a result of $624 million in impairment related charges recorded in the June 2008 quarter, primarily related to certain intangible assets and aircraft.

~~Table~~ Impairment of goodwill and other intangible assets. During the March 2008 quarter, we experienced a significant decline in market capitalization driven primarily by record high fuel prices and overall airline industry conditions. In addition, the announcement of ~~Contents~~our intention to merge with Delta established a stock exchange ratio based on the relative valuation of Northwest and Delta. As a result of these indicators, we determined goodwill was impaired and recorded a non-cash charge of $3.9 billion based on a preliminary assessment. During the June 2008 quarter, we finalized the goodwill impairment test and reversed $674 million of the goodwill impairment charge recorded in the March 2008 quarter. During the June 2008 quarter, we also recorded a non-cash charge of $598 million to reduce the carrying value of certain intangible assets based on their revised estimated fair values.

~~Results~~ Restructuring ofand ~~Operations~~merger-related —items. ~~Three~~During ~~months~~the ~~ended March~~June 312009 quarter, we recorded $31 million ~~2009~~in ~~and~~merger-related ~~2008~~charges associated with integrating the operations of Northwest into Delta.

~~Operating~~Other ~~Revenues. Operating~~Expense ~~revenues decreased 17.1 percent~~ (~~$536 million~~Income)~~, as a result of reduction in passenger revenue and~~ ~~cargo revenue, partially offset by an increase in regional carrier revenue and other revenue.~~

~~System~~ We ~~Passenger~~recorded ~~Revenues. Mainline~~other ~~passenger~~expense, ~~revenues decreased~~net byof ~~22.1~~$169 million ~~percent,~~in ~~due~~the toJune 2009 ~~the~~quarter ~~year-over-year~~as ~~decreases~~compared into ~~capacity,~~other ~~passenger~~expense, ~~load~~net ~~factor,~~of ~~and~~$292 million ~~yield~~in the June 2008 quarter. In This decrease is due to the impairment in ~~following~~2008 ~~analysis~~of byour ~~region,~~$213 million ~~mainline~~minority ~~statistics~~ownership ~~exclude~~interest ~~regional~~in ~~carriers~~Midwest Air Partners, LLC, partially offset ~~which~~by isthe ~~consistent~~increase ~~with~~in ~~how~~debt ~~the~~discount ~~Company~~amortization ~~reports~~recorded ~~statistics~~in tointerest ~~the~~expense ~~Department of~~as ~~Transportation~~a ~~(“DOT”)~~result of purchase accounting.

	Mainline									Total
	Domestic			Pacific			Atlantic			Mainline			Consolidated
2009
Passenger revenues (in millions)	$	1,091		$	494		$	209		$	1,794		$	2,237
Increase (Decrease) from 2008:
Passenger revenues (in millions)	$	(340	)	$	(59	)	$	(109	)	$	(508	)	$	(471	)
Percent	(23.8		)%	(10.6		)%	(34.2		)%	(22.1		)%	(17.4		)%

Income Taxes

~~Regional~~ We ~~Carrier~~recorded ~~Revenues. Regional~~an ~~carrier~~income ~~revenues increased~~tax ~~9.1~~expense ~~percent~~of ($37 3 million) tofor ~~$443~~the ~~million~~June 2009 quarter, primarily ~~due~~ related to ainternational 35and state income taxes.~~7 percent~~ ~~increase~~We indid ~~available~~not ~~seat~~record ~~miles~~an ~~associated~~income ~~with~~tax ~~the~~benefit ~~delivery~~as a result of ~~new~~our 76loss for the June 2009 quarter. The deferred tax asset resulting from such a net operating ~~seat~~loss ~~regional~~is ~~aircraft~~fully ~~and~~reserved anby ~~increase~~a invaluation ~~yield~~allowance.

~~Cargo~~ We ~~Revenues. Cargo~~recorded ~~revenues~~an ~~decreased~~income ~~53.3 percent~~tax ~~($105~~benefit of $214 million) tofor ~~$92~~the ~~million~~June 2008 ~~due~~quarter, primarily toas a result 48of the impairment of our indefinite-lived intangible assets.2 ~~percent~~The ~~decrease~~impairment of goodwill did not result in ~~volume~~an ~~and~~income atax 9benefit as goodwill is not deductible for income tax purposes.4 ~~percent~~We ~~decrease~~did not inrecord ~~yield~~an income tax benefit for the remainder of our June 2008 quarter loss. The deferred tax asset resulting from such a net operating loss is fully reserved by a valuation allowance.

~~Other~~Results ~~Revenue. Other revenue~~of ~~increased~~Operations—Six ~~17.5~~Months ~~percent~~Ended ~~($40~~June 2009 ~~million) to $269 million due primarily to increased charter~~ and ~~partner revenues.~~2008

21Operating Revenue

~~Table~~ Mainline Passenger ofRevenue. ~~Contents~~Mainline passenger revenue decreased by $1.3 billion due to (1) the year-over-year decreases in capacity, passenger load factor and passenger mile yield and (2) lower fuel surcharges due to year-over-year decline in fuel prices.

~~Operating~~ Regional ~~Expenses~~Carriers. ~~Operating~~ ~~expenses~~Passenger ~~decreased 63.6~~revenue ~~percent~~of ~~($4.6~~regional ~~billion)~~carriers ~~for~~was ~~the~~relatively ~~three~~flat ~~months ended March 31, 2009. The following table and notes present operating expenses~~ for the ~~three~~ six months ended ~~March~~June 3130, 2009 and ~~2008~~ ~~and describe significant year-over-year variances:~~2008.

	Three Months Ended				Increase
	March 31				(Decrease)			Percent
(In millions)	2009		2008		from 2008			Change		Note
Operating Expenses
Aircraft fuel and related taxes	$	586	$	1,115	$	(529	)	(47.4	)%	A
Salaries and related costs	748		728		20			2.7		B
Contract carrier arrangements	190		264		(74		)	(28.0	)	D
Depreciation and amortization	127		148		(21		)	(14.2	)	F
Aircraft maintenance materials and repairs	155		209		(54		)	(25.8	)	E
Contracted services	222		206		16			7.8		B
Passenger commissions and other selling expenses	175		215		(40		)	(18.6	)	E
Landing fees and other rents	148		129		19			14.7		C
Passenger service	53		59		(6		)	(10.2	)	B
Aircraft rent	58		54		4			7.4		B
Goodwill and other indefinite-lived intangibles impairment	—		3,917		(3,917		)	(100.0	)	G
Restructuring and merger related	53		—		53			n/m		H
Other, net	103		143		(40		)	(28.0	)	I
Total operating expenses	$	2,618	$	7,187	$	(4,569	)	(63.6	)%

Cargo. Cargo revenue decreased $234 million to $176 million due to the effects of capacity reductions including the grounding of certain dedicated freighter B-747-200F aircraft, significantly reduced cargo yields, decreased international volume and lower fuel surcharges due to the year-over-year decline.

~~A. Aircraft fuel~~ Other, ~~and taxes for the first quarter of 2009 includes $91~~net.9 ~~million~~Other, in net ~~fuel derivative~~revenue ~~contract~~increased ~~losses, consisting of a~~ $~~1.8~~ 82 million ~~loss associated with marking-~~to~~-market~~ ~~out-of-period fuel hedges and~~ $~~90.1 million of losses for contracts settled during the current period.~~543 ~~Fuel expense for the first quarter of 2008 includes $5.3~~ million indue ~~net fuel~~primarily ~~derivative contract gains, consisting of a $12.3 million loss associated with marking-~~to~~-market~~ increased ~~out-of-period fuel hedges and $17.6 million of gains for~~baggage ~~contracts~~handling ~~settled in the first quarter of 2008~~fees.

~~B. Salaries~~17 ~~and related costs, contracted services, landing fees and other rents, passenger service, and aircraft rent, were relatively flat year-over-year.~~

C. LandingTable Feesof and other rents increased year-over-year primarily due to increased facilities rent expense.Contents

~~D. Contract carrier~~Operating ~~arrangements decreased year-over-year primarily due to lower fuel~~Expense ~~costs.~~

E. Passenger commissions and other selling expenses and aircraft maintenance and repairs decreased year-over-year primarily due to the year-over-year decrease in capacity and related grounding of aircraft.


					Increase
	Six Months Ended June 30,				(Decrease)			Percent
(In millions)	2009		2008		from 2008			Change

Operating Expense:
Salaries and related costs	$	1,481	$	1,476	$	5			—	%
Aircraft fuel and related taxes		1,185		2,300		(1,115	)		(48	)
Contract carrier arrangements		412		545		(133	)		(24	)
Contracted services		366		413		(47	)		(11	)
Aircraft maintenance materials and outside repairs		308		395		(87	)		(22	)
Passenger commissions and other selling expenses		299		439		(140	)		(32	)
Landing fees and other rents		279		272		7			3
Depreciation and amortization		253		893		(640	)		(72	)
Aircraft rent		118		110		8			7
Passenger service		115		125		(10	)		(8	)
Impairment of goodwill and other intangible assets		—		3,841		(3,841	)	NM
Restructuring and merger-related items		84		—		84		NM
Other		207		266		(59	)		(22	)

Total operating expense	$	5,107	$	11,075	$	(5,968	)		(54	)%

F Aircraft fuel and related taxes. ~~Depreciation~~ Aircraft fuel and ~~amortization~~related taxes decreased ~~year-over-year~~ $1.1 billion primarily due to ~~the~~decreases ~~impairment~~ of ~~two~~ ~~DC9-30~~(1) ~~aircraft~~$1.2 billion ~~and~~associated ~~three~~with ~~747F~~lower ~~airframes,~~average ~~engines~~fuel prices and ~~related~~(2) $289 million ~~inventory~~in lower fuel consumption due to capacity reductions. These decreases were partially ~~during~~offset by $103 million in net fuel hedge losses for the ~~first~~six ~~quarter~~months ofended June 30, 2009, compared to $283 million in net fuel hedge gains for the six months ended June 30, 2008.

~~G. During the~~ Contract ~~first~~carrier ~~quarter~~arrangements. ofContract ~~2008,~~carrier ~~the~~arrangements ~~Company~~decreased ~~recorded~~primarily adue ~~non-cash goodwill impairment charge~~ to ~~reduce the book value of Northwest’s equity to its implied fair value~~lower asfuel ~~of the Announcement Date~~costs. ~~See “Item~~ ~~1. Financial Statements, Note 2 — Goodwill and Intangibles” for additional information.~~

~~H. During~~ Aircraft ~~the~~maintenance ~~first~~materials ~~quarter~~and ofoutside ~~2009,~~repairs. ~~the~~Aircraft ~~Company~~maintenance ~~recorded~~materials ~~expenses~~and ~~related~~outside ~~to voluntary~~repairs ~~workforce~~decreased ~~reductions~~primarily ~~and~~due to the ~~Merger. See “Note~~decrease 5in —capacity ~~Restructuring~~ and ~~Merger~~related ~~Related~~grounding ~~Expenses”~~of ~~for additional information~~aircraft.

I Passenger commission and other selling expenses. ~~Other~~ Passenger commissions and other selling expenses decreased primarily due to ~~reduced~~the ~~professional~~decrease ~~fee~~in ~~expenses~~capacity.

~~Other~~ Depreciation ~~Income~~ and ~~Expense~~amortization. ~~The~~ ~~Company~~Depreciation ~~recorded~~and ~~non-operating~~amortization ~~expense~~expenses ~~of $163~~decreased ~~million in the first quarter of 2009~~ as ~~compared~~a ~~to non-operating expense~~result of $86 641 million in ~~the~~impairment ~~first~~related ~~quarter~~charges ofrecorded ~~2008. The increase~~ in ~~non-operating expense is primarily due to~~ the ~~debt discount~~six ~~amortization~~months ~~recorded~~ended inJune 30, ~~Interest expense on the Condensed Consolidated~~2008, ~~Statements~~primarily ofrelated ~~Operations~~to ascertain aintangible ~~result~~assets ofand ~~purchase accounting~~aircraft.

~~Tax~~ Impairment ~~Expense~~of ~~(Benefit)~~goodwill and other intangible assets. ~~Given~~ ~~its~~During ~~recent~~the ~~loss~~March 2008 ~~experience~~quarter, we experienced a significant decline in market capitalization driven primarily by record high fuel prices and overall airline industry conditions. In addition, the ~~Company~~announcement of our intention to ~~provides~~merge with Delta established a stock exchange ratio based on the relative valuation ~~allowance~~of ~~against~~Northwest and ~~tax~~Delta. ~~benefits~~As a result of these indicators, ~~principally~~we ~~for~~determined ~~net operating~~goodwill ~~losses~~was inimpaired ~~excess~~and recorded a non-cash charge of ~~its~~$3.9 billion ~~deferred~~based ~~tax~~on ~~liability~~a preliminary assessment. It isDuring ~~more~~the ~~likely~~June 2008 ~~than~~quarter, ~~not~~we finalized ~~that~~the ~~future~~goodwill impairment test and reversed $674 million of the goodwill impairment charge ~~deferred~~recorded ~~tax~~in ~~assets~~the ~~will~~March 2008 ~~require~~quarter. aDuring ~~valuation~~the ~~allowance~~June 2008 toquarter, bewe also recorded toa ~~fully~~non-cash ~~reserve~~charge ~~against~~of $598 million to reduce the ~~uncertainty~~carrying ~~that~~value ~~those~~of certain intangible assets ~~would~~based beon ~~realized.~~their revised estimated fair values.

22 Restructuring and merger-related items. During the six months ended June 30, 2009, we recorded $84 million in merger-related charges associated with integrating the operations of Northwest into Delta.

~~Table~~Other ofExpense ~~Contents~~(Income)

~~Other~~ We ~~Information~~recorded other expense, net of $332 million in the six months ended June 30, 2009 as compared to other expense, net of $378 million in the six months ended June 30, 2008. The decrease is due to the impairment in 2008 of our $213 million minority ownership interest in Midwest Air Partners, LLC, partially offset by (1) the increase in debt discount amortization recorded in interest expense as a result of purchase accounting and (2) a decrease in interest income primarily from significantly reduced short-term interest rates.

~~Forward-Looking~~18 Statements. Certain of the statements made throughout Management’s Discussion and Analysis of Financial Condition and Results of Operations and elsewhere in this quarterly report are not purely historical facts, including statements regarding our beliefs, expectations, intentions or strategies for the future, may be “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. All forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from the plans, intentions and expectations reflected in or suggested by the forward-looking statements. For examples of such risks and uncertainties, please see the cautionary statements contained in “Item 1A. Risk Factors” of the Company’s 2008 Form 10-K. All forward looking statements speak only as of the date made, and we undertake no obligation to update any forward-looking statements to reflect events or circumstances that may arise after the date of this release.

23Table of Contents

~~Table~~Income ~~of Contents~~Taxes

~~Item~~ We recorded an income tax expense of $3. million ~~Quantitative~~for the six months ended June 30, 2009, primarily related to international and ~~Qualitative~~state ~~Disclosures~~income ~~About~~taxes. ~~Market~~We ~~Risk~~did not record an income tax benefit as a result of our loss for the six months ended June 30, 2009. The deferred tax asset resulting from such a net operating loss is fully reserved by a valuation allowance.

~~Omitted~~ We recorded an income tax benefit of $214 million for the six months ended June 30, 2008, ~~under~~primarily as a result of the ~~reduced~~impairment ~~disclosure~~of ~~format~~our ~~permitted~~indefinite-lived byintangible ~~General~~assets. ~~Instruction~~The ~~H(2)(c)~~ impairment of goodwill did not result in an income tax benefit as goodwill is not deductible for income tax ~~Form~~purposes. We did not record an income tax benefit for the remainder of six months ended June ~~10-Q~~30, 2008 loss. The deferred tax asset resulting from such a net operating loss is fully reserved by a valuation allowance.

~~Item 4~~ITEM 3. ~~Controls~~Quantitative and ~~Procedures~~Qualitative Disclosures About Market Risk.

~~Evaluation of~~ Omitted ~~Disclosure Controls and Procedures — As of March 31, 2009, management performed an evaluation~~ under the ~~supervision~~reduced ~~and~~disclosure ~~with~~format ~~the~~permitted ~~participation~~by ofGeneral ~~the Company’s~~Instruction ~~President~~H(2)(c) ~~and Chief Operating Officer and Vice President and Chief Financial Officer~~ of ~~the effectiveness of the design and operation of the Company’s disclosure controls and procedures covered in this Quarterly Report on~~ Form 10-Q. ~~Based on that~~ evaluation, the Company’s President and Chief Operating Officer and Vice President and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective in alerting them in a timely manner to material information required to be disclosed in the Company’s periodic report filed with the SEC as of the end of such period.

~~Changes in Internal Control — There was no change in the Company’s internal control over financial reporting that occurred during the Company’s fiscal first quarter ended March~~ITEM ~~31, 2009 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting~~4. ~~Management~~ ~~will continue~~Controls toand ~~evaluate our internal control over financial reporting as we execute merger integration activities because integration activities could materially affect the internal control over financial reporting~~Procedures.

~~PART II~~ Management, including the President and Chief Operating Officer and Vice President - Finance, performed an evaluation of our disclosure controls and procedures, which have been designed to effectively identify and timely disclose important information. Management, including the President and Chief Operating Officer and Vice President - Finance, concluded that the controls and procedures were effective as of June 30, 2009 to ensure that ~~OTHER~~material ~~INFORMATION~~information was accumulated and communicated to management, including the President and Chief Operating Officer and Vice President - Finance, as appropriate to allow timely decisions regarding required disclosure.

~~Item~~ Except 1.as ~~Legal~~set ~~Proceedings~~forth below, during the three months ended June 30, 2009, we made no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

~~Reference~~ On isOctober 29, ~~made~~2008 towe ~~“Item~~completed 3our Merger with Delta Air Lines, Inc. ~~Legal~~We ~~Proceedings”~~are incurrently ~~the~~integrating ~~Company’s~~policies, ~~2008~~processes, ~~Form 10-K~~people, technology and operations for athe ~~discussion~~combined ofcompany. Management ~~other~~will ~~legal~~continue to evaluate our internal control over financial reporting as we execute ~~proceedings~~Merger integration activities.

~~Northwest Airlines, Inc. v.~~19 Filipas, et al (U.S. Dist. Ct. Minnesota, Case 07-CIV-4803 (JNE/JJG)). On December 12, 2007, Northwest Airlines, Inc. filed a declaratory judgment action against six of its employee pilots seeking a declaration that its recently implemented Target Benefit Pension Plan (collectively bargained for with the Air Line Pilots Association) does not violate any applicable prohibitions against age discrimination, including under ERISA. The court has certified a defendant class of all employee pilots who will receive less under the new target plan than they would have received under the predecessor plan that provided benefits to pilots on a “flat percentage” or “pro rata to pay” basis. On January 26, 2009, the District Court granted summary judgment in favor of Northwest on its claim as well as the defendants’ counterclaims. Claims by the employee pilots against the Air Line Pilots Association remain pending in the case and consequently no final order has been entered.

ItemTable 1A.of Risk Factors.Contents

~~See Part I,~~REPORT ~~Item~~OF ~~1A.,~~INDEPENDENT ~~“Risk~~REGISTERED ~~Factors,”~~PUBLIC ofACCOUNTING ~~the Company’s 2008 Form 10-K for~~FIRM ~~a detailed discussion of the risk factors affecting the Company. There have been no material changes from the risk factors described in the Company’s 2008 Form 10-K.~~

~~Item~~To 6.the ~~Exhibits.~~Board of Directors of Northwest Airlines Corporation

We have reviewed the condensed consolidated balance sheet of Northwest Airlines Corporation (athe Company) ~~Exhibits:~~ as of June 30, 2009, and the related condensed consolidated statements of operations for the three-month and six-month periods ended June 30, 2009 and 2008, and the condensed consolidated statements of cash flows for the six-month periods ended June 30, 2009 and 2008. These financial statements are the responsibility of the Company’s management.

10.1	Fourth Amendment to Airline Operating Agreement and Terminal Building Lease Minneapolis-St. Paul International Airport dated as of February 6, 2009 by and between the Metropolitan Airports Commission and Northwest Airlines, Inc.
10.2	Second Amendment dated as of March 30, 2009 to the Credit Agreement dated as of October 29, 2008 among Northwest Airlines, Inc., Northwest Airlines Corporation, certain subsidiaries of Northwest Airlines, Inc., various lenders and U.S. Bank National Association, as Administrative Agent.
31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.
31.2	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.

We conducted our review in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with standards of the Public Company Accounting Oversight Board, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

24Based on our review, we are not aware of any material modifications that should be made to the accompanying condensed consolidated financial statements referred to above for them to be in conformity with U.S. generally accepted accounting principles.

~~Table~~We have previously audited, in accordance with the standards of ~~Contents~~the Public Company Accounting Oversight Board (United States), the consolidated balance sheet of Northwest Airlines Corporation as of December 31, 2008 and the related consolidated statements of operations, stockholder’s equity, and cash flows for the year ended December 31, 2008 and in our report dated March 2, 2009, we expressed an unqualified opinion on those consolidated financial statements.

~~SIGNATURE~~/s/ Ernst & Young LLP

~~Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934~~Atlanta, ~~the Registrant has duly~~Georgia ~~caused~~July ~~this report to be signed on its behalf by the undersigned~~30, ~~thereunto duly authorized this 24th day of April~~ 2009.

~~NORTHWEST AIRLINES CORPORATION By /s/ Anna M. Schaefer Anna M. Schaefer Vice President — Finance and Chief Accounting Officer (principal accounting officer)~~20

EXHIBITTable INDEXof Contents

Exhibit No.		Description
10.1		Fourth Amendment to Airline Operating Agreement and Terminal Building Lease Minneapolis-St. Paul International Airport dated as of February 6, 2009 by and between the Metropolitan Airports Commission and Northwest Airlines, Inc.
10.2		Second Amendment dated as of March 30, 2009 to the Credit Agreement dated as of October 29, 2008 among Northwest Airlines, Inc., Northwest Airlines Corporation, certain subsidiaries of Northwest Airlines, Inc., various lenders and U.S. Bank National Association, as Administrative Agent.
31.1		Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.
31.2		Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.

PART II. OTHER INFORMATION

25ITEM 1. Legal Proceedings.

Reference is made to “Item 3. Legal Proceedings” in our 2008 Form 10-K for a discussion of other legal proceedings.

Northwest Airlines, Inc. v. Filipas, et al (U.S. Dist. Ct. Minnesota, Case 07-CIV-4803 (JNE/JJG)). On December 12, 2007, Northwest Airlines, Inc. filed a declaratory judgment action against six of its employee pilots seeking a declaration that its recently implemented Target Benefit Pension Plan (collectively bargained for with the Air Line Pilots Association) does not violate any applicable prohibitions against age discrimination, including under ERISA. The court has certified a defendant class of all employee pilots who will receive less under the new target plan than they would have received under the predecessor plan that provided benefits to pilots on a “flat percentage” or “pro rata to pay” basis. On January 26, 2009, the District Court granted summary judgment in favor of Northwest on its claim as well as the defendants’ counterclaims. Claims by the employee pilots against the Air Line Pilots Association remain pending in the case and consequently no final order has been entered.

ITEM 1A. Risk Factors.

“Item 1A. Risk Factors” of our Form 10-K includes a discussion of our risk factors. The information presented below updates, and should be read in conjunction with, the risk factors and information disclosed in our Form 10-K. Except as presented below, there have been no material changes from the risk factors described in our Form 10-K.

Risk Factors Relating to Northwest

The global economic recession has resulted in weaker demand for air travel and may create challenges for us that could have a material adverse effect on our business and results of operations.

As the effects of the global economic recession have been felt in our domestic and international markets, we are experiencing weaker demand for air travel. Our demand began to slow during the December 2008 quarter and global economic conditions in 2009 are substantially reducing U.S. airline industry revenues in 2009 compared to 2008. As a result, Delta is reducing consolidated capacity by 7-9% in 2009 compared to 2008 (which reflects planned domestic capacity reductions of 8-10% and international capacity reductions of 7-9%). Demand for air travel could remain weak or even continue to fall if the global economic recession continues for an extended period, and overall demand could fall lower than we are able prudently to reduce capacity. The weakness in the United States and international economies is having a significant negative impact on our results of operations and could continue to have a significant negative impact on our future results of operations.

Certain of our credit facilities include financial and other covenants that impose restrictions on our financial and business operations.

Our exit facility financing credit agreement and liquidity facility credit agreement both contain financial covenants that require us, to maintain a minimum fixed charge coverage ratio, minimum unrestricted cash reserves and minimum collateral coverage ratios. The value of the collateral that has been pledged in both facilities may change over time, including due to factors that are not under our control, resulting in a situation where we may not be able to maintain the collateral coverage ratio. In addition, both of the credit facilities contain other negative covenants customary for such financings. These covenants may have a material adverse impact on our operations. Moreover, if we fail to comply with the covenants in either facility and are unable to obtain a waiver or amendment, an event of default would result under that facility.

Both of the credit facilities also contain other events of default customary for such financings. If an event of default were to occur, the lenders could, among other things, declare outstanding borrowings under the respective credit facility immediately due and payable, and our cash may become restricted. We cannot provide assurance that we would have sufficient liquidity to repay or refinance borrowings under either of the credit facilities if such borrowings were accelerated upon an event of default. In addition, an event of default or declaration of acceleration under either of the credit facilities could also result in an event of default under other financing agreements.

Our ability to use certain net operating loss carryforwards to offset future taxable income for U.S. federal income tax purposes is subject to limitation.

In general, under Section 382 of the Internal Revenue Code of 1986, as amended, a corporation that undergoes an “ownership change” is subject to limitations on its ability to utilize its pre-change net operating losses (“NOLs”), to offset future taxable income. In general, an ownership change occurs if the aggregate stock ownership of certain stockholders increases by more than 50 percentage points over such stockholders’ lowest percentage ownership during the testing period (generally three years).

As of June 30, 2009, Delta reported a consolidated federal and state NOL carryforward of approximately $16.0 billion. Both Delta and Northwest experienced an ownership change in 2007 as a result of their respective plans of reorganization under Chapter 11 of the U.S. Bankruptcy Code. As a result of the merger, Northwest experienced a subsequent ownership change. Delta and its subsidiaries, including Northwest, experienced a subsequent ownership change on December 17, 2008 as a result of the merger, the issuance of equity to employees in connection with the merger and other transactions involving the sale of our common stock within the testing period.

The Delta and Northwest ownership changes resulting from the merger could limit the ability to utilize pre-change NOLs that were not subject to limitation, and could further limit the ability to utilize NOLs that were already subject to limitation. Limitations imposed on the ability to use NOLs to offset future taxable income could cause U.S. federal income taxes to be paid earlier than otherwise would be paid if such limitations were not in effect and could cause such NOLs to expire unused, in each case reducing or eliminating the benefit of such NOLs. Similar rules and limitations may apply for state income tax purposes. NOLs generated subsequent to December 17, 2008 are not limited.

Risk Factors Relating to the Airline Industry

The rapid spread of contagious illnesses can have a material adverse effect on our business and results of operations.

The rapid spread of a contagious illness, such as the H1N1 flu virus beginning in March 2009, can have a material adverse effect on the demand for worldwide air travel and therefore have a material adverse effect on our business and results of operations. Further acceleration of the spread of H1N1 during the flu season in the Northern Hemisphere could have a significant adverse impact on our financial results in addition to the impact that we have already experienced during the spring of 2009. Moreover, our operations could be negatively affected if employees are quarantined as the result of exposure to a contagious illness. Similarly, travel restrictions or operational problems resulting from the rapid spread of contagious illnesses in any part of the world in which we operate may materially impact our operations and adversely affect our results of operations.

The airline industry is highly competitive and, if we cannot successfully compete in the marketplace, our business, financial condition and operating results will be materially adversely affected.

We face significant competition with respect to routes, services and fares. Our domestic routes are subject to competition from both new and established carriers, some of which have lower costs than we do and provide service at low fares to destinations served by us. In particular, we face significant competition at several of our hub airports either directly at the hub airports or at the hubs of other airlines that are located in close proximity to our hubs. We also face competition in smaller to medium-sized markets from regional jet operators.

Low-cost carriers, including Southwest, AirTran and JetBlue, in the U.S. have placed significant competitive pressure on us and other network carriers in the domestic market. In addition, other network carriers have also significantly reduced their costs over the last several years. Our ability to compete effectively depends, in part, on our ability to maintain a competitive cost structure. If we cannot maintain our costs at a competitive level, then our business, financial condition and operating results could be materially adversely affected. In light of increased jet fuel costs and other issues in recent years, we expect consolidation to occur in the airline industry. As a result of consolidation, we may face significant competition from larger carriers that may be able to generate higher amounts of revenue and compete more efficiently.

In addition, we compete with foreign carriers, both on interior U.S. routes, due to marketing and codesharing arrangements, and in international markets. Through marketing and codesharing arrangements with U.S. carriers, foreign carriers have obtained access to interior U.S. passenger traffic. Similarly, U.S. carriers have increased their ability to sell international transportation, such as transatlantic services to and beyond European cities, through alliances with international carriers. International marketing alliances formed by domestic and foreign carriers, including the Star Alliance (among United Airlines, Lufthansa German Airlines and others and which Continental has announced its intention to join in October 2009) and the oneworld Alliance (among American Airlines, British Airways and others) have also significantly increased competition in international markets. In addition, the adoption of liberalized Open Skies Aviation Agreements with an increasing number of countries around the world, including in particular the Open Skies agreement between the U.S. and the Member States of the European Union, has accelerated this trend. Negotiations are under way between the United States and other countries, such as Japan, regarding similar agreements with countries, which, if effectuated, could significantly increase competition in these markets.

ITEM 6. Exhibits.

(a) Exhibits:


31.1		Certification by Northwest’s President and Chief Operating Officer with respect to Northwest’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2009

31.2		Certification by Northwest’s Vice President - Finance with respect to Northwest’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2009

SIGNATURE

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized this 30th day of July 2009.


	NORTHWEST AIRLINES CORPORATION
	By	/s/ Ray Winborne
		Ray Winborne
		Vice President — Finance (Principal Financial and Accounting Officer)

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