
Spirit Airlines urges US to reject JetBlue, United partnership
United and JetBlue said in May the "Blue Sky" tie-up would allow travelers to book flights on both carriers' websites, while interchangeably earning and using points in their frequent flyer programs. Spirit said the deal would mean the smaller JetBlue "will become a de facto vassal of United." Spirit added "this anti-competitive tie-up involving a dominant legacy carrier will neutralize the competitive benefit of an existing low-fare competitor."
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The Independent
24 minutes ago
- The Independent
Harley-Davidson, Hershey, Adidas, Mercedes warn of profit woes and tariff costs after US-EU 15% deal
Companies from a variety of industries warned about the impact of Trump administration tariffs during the latest round of quarterly financial disclosures, on the heels of the recently announced 15 percent U.S.-E.U. tariff deal and days before steeper across-the-board tariffs are set to take effect on August 1. American motorcycle mainstay Harley-Davidson announced a net income of $108 million, down from $218 million during the same period last year, missing analyst expectations. The company also said it would hold off on providing guidance for the year, after withdrawing sales and profit forecasts in May in the face of the tariffs. In the apparel sector, Adidas shared warnings of its own. The company announced more than $6.8 billion in sales, a 2.2 percent increase in year-on-year sales, though the figure missed analyst expectations. While the company still expects an operating profit in 2025, it told investors Trump's tariffs could increase its costs by up to $231 million. 'The year has started great for us and normally we would now be very bullish in our outlook for the full year,' Chief Executive Bjorn Gulden said on Wednesday. 'We feel the volatility and uncertainty in the world does not make this prudent.' The company is weighing possible U.S. price increases, though it hasn't decided yet. Though sales were up, operating profits were down 33 percent for chocolate giant Hershey compared with the second quarter of 2024. The company said it expects adjusted earnings per share to decline between 36 and 38 percent, as the company confronts between $170 million and $189 million in tariff expenses, a roughly 10 times increase from its tariff cost estimates in May. Mercedes, meanwhile, said tariffs would eat 1.5 percentage points into its operating margin, equivalent to $420 million in the second quarter. The company will face levies as it imports vehicles to the U.S. from Mexico, China, and Europe, as well as input costs for importing parts to its Alabama vehicle factory. During the second quarter, net profits were roughly $1.06 billion, down from $3.45 billion during the same period last year, as the company faces tariff headwinds and collapsing demand in China.


The Independent
24 minutes ago
- The Independent
Trump hits ‘too late' Jerome Powell as Federal Reserve keeps interest rates steady despite two board dissenters
President Donald Trump on Wednesday continued his attacks on Federal Reserve Board of Governors chair Jerome Powell as the American central bank again rebuffed his demand for lower interest rates, keeping them steady for at least another month. Speaking in the Roosevelt Room during a bill signing ceremony, the president hit out at Powell, who he has blamed for decisions made by the bank's powerful Open Markets Committee, using the derisive nickname he assigned him when he began to demand lower rates months earlier. 'We should be the lowest interest rate. And we're not. We're ... number 38 because of the Fed. It's all because of the Fed. He's done a bad job. Now. He's got a meeting today, but I call him too late. You know, he's always too late, even if he does it today, probably won't. I hear they're going to do it in September, not today,' Trump said. In a statement, the bank justified the decision to keep rates steady by noting that while employment and economic growth remain steady after Trump's first half-year in office, the rate of inflation remains "somewhat elevated." Powell offered some further explanation during remarks announcing the decision in which he stressed that Trump's "reciprocal tariffs" have led to some increased inflation around goods, the long-term economic effects of tariffs remain to be seen. The Fed's decision to keep interest rates stagnant comes the same day that the Bureau of Economic Analysis released its report showing that GDP grew by 3 percent in the last economic quarter between April and June. This came after the previous quarter where GDP actually shrank, which Trump blamed on his predecessor Joe Biden. The decision comes after weeks of bullying and browbeating of Powell by Trump and his allies, including top officials at the Office of Management and Budget and the Federal Housing Finance Administration, who have seized on long-running renovations at the Fed's headquarters as a possible pretext under which Trump would fire Powell, who he appointed to lead the Fed during his first term.


The Independent
24 minutes ago
- The Independent
Is AI causing tech worker layoffs? That's what CEOs suggest, but the reality is complicated
If you read the typical 2025 mass layoff notice from a tech industry CEO, you might think that artificial intelligence cost workers their jobs. The reality is more complicated, with companies trying to signal to Wall Street that they're making themselves more efficient as they prepare for broader changes wrought by AI. A new report Wednesday from career website Indeed says tech job postings in July were down 36% from their early 2020 levels, with AI one but not the most obvious factor in stalling a rebound. ChatGPT's debut in late 2022 also corresponded with the end of a pandemic-era hiring binge, making it hard to isolate AI's role in the hiring doldrums that followed. 'We're kind of in this period where the tech job market is weak, but other areas of the job market have also cooled at a similar pace,' said Brendon Bernard, an economist at the Indeed Hiring Lab. 'Tech job postings have actually evolved pretty similarly to the rest of the economy, including relative to job postings where there really isn't that much exposure to AI.' The template for tech CEO layoff notices in 2025 includes an AI pivot That nuance is not always clear from the last six months of tech layoff emails, which often include a nod to AI in addition to expressions of sympathy. When he announced mass layoffs earlier this year, Workday CEO Carl Eschenbach invited employees to consider the bigger picture: 'Companies everywhere are reimagining how work gets done, and the increasing demand for AI has the potential to drive a new era of growth for Workday." Autodesk CEO Andrew Anagnost explained that a need to shift resources to 'accelerate investments' in AI was one of the reasons the company had to cut 1,350, or about 9%, of workers. The 'Why We're Doing This' section of CrowdStrike CEO George Kurtz's announcement of 5% job cuts said the cybersecurity company needed to double down on AI investments to 'accelerate execution and efficiency.' 'AI flattens our hiring curve, and helps us innovate from idea to product faster,' Kurtz wrote. It's not just U.S. companies. In India, tech giant Tata Consultancy Services recently characterized its 12,000 layoffs, or 2% of its workforce, as part of a shift to a 'Future-Ready organization' that would be realigning its workforce and 'deploying AI at scale for our clients and ourselves.' Even the Japanese parent company of Indeed and Glassdoor has cited an AI shift in its notice of 1,300 layoffs at the job search and workplace review sites. AI spending, not replacement, is a more common factor Microsoft, which is scheduled to release its fourth-quarter earnings Wednesday, has announced layoffs of about 15,000 workers this year even as its profits have soared. Microsoft CEO Satya Nadella told employees last week the layoffs were 'weighing heavily' on him but also positioned them as an opportunity to reimagine the company's mission for an AI era. Promises of a leaner approach have been welcomed on Wall Street, especially from tech giants that are trying to justify huge amounts of capital spending to pay for the data centers, chips and other components required to power AI technology. 'It's this sort of double-edged sword restructuring that I think a lot of tech giants are encountering in this age of AI, where they have to find the right balance between maintaining an appropriate headcount, but also allowing artificial intelligence to come to the forefront,' said Bryan Hayes, a strategist at Zacks Investment Research. Google said last week it would raise its budget for capital expenditures by an additional $10 billion to $85 billion. Microsoft is expected to outline similar guidance soon. The role of AI in job replacement is hard to track One thing is clear to Hayes: Microsoft's job cuts improve its profit margin outlook for the 2026 fiscal year that started in July. But what these broader tech industry layoffs mean for the employment prospects of tech workers can be harder to gauge. 'Will AI replace some of these jobs? Absolutely,' said Hayes. 'But it's also going to create a lot of jobs. Employees that are able to leverage artificial intelligence and help the companies innovate, and create new products and services, are going to be the ones that are in high demand.' He pointed to Meta Platforms, the parent company of Facebook and Instagram, which is on a spree of offering lucrative packages to recruit elite AI scientists from competitors such as OpenAI. The reports published by Indeed on Wednesday show that AI specialists are faring better than standard software engineers, but even those jobs are not where they have been. 'Machine-learning engineers — which is kind of the canonical AI job — those job postings are still noticeably above where they were pre-pandemic, though they've actually come down compared to their 2022 peak,' said Bernard, the Indeed economist. 'They've also been impacted by the cyclical ups and downs of the sector.' Economists are watching for AI's effects on entry-level tech jobs Tech hiring has particularly plunged in AI hubs such as the San Francisco Bay Area, as well as Boston and Seattle, according to Indeed. But in looking more closely at which tech workers were least likely to get hired, Indeed found the deepest impact on entry-level jobs in the tech industry, with those with at least five years of experience faring better. The hiring declines were sharpest in entry-level tech industry jobs that involve marketing, administrative assistance and human resources, which all involve tasks that overlap with the strength of the latest generative AI tools that can help create documents and images. 'The plunge in tech hiring started before the new AI age, but the shifting experience requirements is something that happened a bit more recently,' Bernard said.