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Frontier Group reports bigger than expected Q3 loss due to soft domestic demand
Frontier Group, the parent company of discount airline Frontier Airlines, announced a larger-than-expected third-quarter loss on Tuesday due to a softening domestic travel market. This caused its shares in early trading to drop 9%. In April, several major U.S. airlines, including Frontier Airlines, revised their financial projections, citing the uncertainty caused by President Donald Trump's tariffs and cuts to government spending, which prompted consumers to reduce travel plans. Budget-conscious travelers are still cautious despite the fact that airline executives and analysts claim there is a stabilization in demand. This year's summer season, which is traditionally the most profitable for the industry, has been underwhelming. The low demand for economy seats forced airlines to cut fares. LSEG data shows that the carrier's third-quarter adjusted loss will be between 26 and 42 cents per share, compared to analysts' estimates of 11 cents. The executives are betting on the fact that the capacity reductions this year will improve airfare and pricing power. Frontier expects that its third quarter capacity will fall between 3% and 5% compared to the same period last year. Barry Biffle, CEO of Frontier Markets, said that the balance between domestic supply and demand is expected to improve over the next few months. It reported a loss of 31 cents for each share during the quarter ending in June. This compares to a profit of 14 cents per shares a year ago. Analysts predicted a loss between 27 and 30 cents. The total revenue dropped 4.5%, to $929.12 million. This was lower than the $946.12 millions expected by Wall Street. Reporting by Shivansh Tiwary from Bengaluru, and Doyinsola Oladipo from New York. Editing by Shilpa Majumdar.
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Expeditors reports positive results on increased freight volumes and customs fees
The global freight forwarder, Expeditors of Washington, reported Tuesday that its second-quarter revenue and profit were above Wall Street expectations. This was due to higher ocean and air container volumes as well as larger custom fees. The quarter ended June 30 saw an increase of 7% in airfreight and ocean container volumes, as companies raced to import goods before the new U.S. Tariffs take effect. It also gained from the increasingly complex policies of trade, which allowed it to charge higher fees for processing. Customs brokers are increasingly being used by U.S. importers to stay up to date with the ever-changing policies of President Donald Trump. The booming demand for these services has led to a higher price, according to industry players. The revenue from Expeditors’ customs brokerage segment increased 10.5%, from $927 to $1.02 Billion. CEO Daniel Wall stated that "Airfreight increased due to growth in tonnage, higher rates and customers shipping technology and high-value inventories ahead of trade deadlines." He added that "ocean business grew on the back of increased volumes and exports, especially out of South Asia as customers moved their sourcing to this region and moved freight ahead of extended tariff deadlines." The Bellevue-based company, which reported quarterly revenues of $2.65 Billion, beat analysts' estimates of $2.44 Billion, according to LSEG data. The second-quarter earnings of $1.34 per shares was also higher than the $1.24 expected. The company still expects the freight market to be volatile for the remainder of the year. (Reporting and editing by Sahal Muhammad in Bengaluru, with Abhinav Paramar reporting from Bengaluru)
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Tesla and Musk sued by shareholders for Robotaxi claims
Elon Musk, Tesla and other companies were accused of securities fraud by investors who claimed that they had concealed the risk associated with the self-driving cars, such as the Robotaxi. The class action lawsuit was filed in federal court in Austin, Texas on Monday night after Tesla's robotaxis were shown to speed, brake suddenly, drive over a curb and enter the wrong lane. They also dropped passengers in the middle multilane highways. Tesla's stock price dropped 6.1% in two days of trading after the test. Shareholders accused Tesla of exaggerating the effectiveness of its self-driving technology and inflating the company's business prospects. The lawsuit is seeking unspecified damages from April 19, 2023 to June 22, 2025. Tesla did not respond to a comment request on Tuesday. (Reporting and editing by Giles Elgood in New York. Reporting by Jonathan Stempel)
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Frontier Group reports bigger than expected Q3 loss due to soft domestic demand
Frontier Group, the parent company of discount airline Frontier Airlines, announced a larger-than-expected third-quarter loss on Tuesday due to a softening domestic travel market. This caused its shares in premarket trading to drop 3%. In April, several major U.S. airlines, including Frontier Airlines, revised their financial projections, citing the uncertainty caused by President Donald Trump's tariffs and cuts to government spending, which prompted consumers to reduce travel plans. Budget-conscious travelers are still cautious despite the fact that airline executives and analysts claim there is a stabilization in demand. This year's summer season, which is traditionally the most profitable for the industry, has been underwhelming. The low demand for economy seats forced airlines to cut fares. LSEG data shows that the carrier's third-quarter adjusted loss will be between 26 and 42 cents per share, compared to analysts' estimates of 11 cents. The executives are betting on the fact that the capacity reductions this year will improve airfare and pricing power. Frontier expects to see a 3%-5% decline in its third quarter capacity compared to the same period last year. Barry Biffle, CEO of Frontier Markets, said that the balance between domestic supply and demand is expected to improve over the next few months. It reported a loss of 31 cents for each share during the quarter ending in June. This compares to a profit of 14 cents per shares a year ago. Analysts predicted a loss between 27 and 30 cents. The total revenue dropped 4.5%, to $929.12 million. This was lower than the $946.12 millions expected by Wall Street. Reporting by Shivansh Tiwary from Bengaluru, and Doyinsola Oladipo from New York. Editing by Shilpa Majumdar.
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Analyst: Ukraine reopens the Danube Canal after explosion
Analyst ASAP Agri stated on Tuesday that the Ukrainian Seaport Authority would reopen Bystre Canal, at the mouth the Danube from Wednesday. The canal had been closed since late July after a dredger explosion. In the first year following the Russian invasion of 2022, Ukraine was forced to use alternative routes for exports. This included the Bystre as well as the Danube. Ukraine has seen a sharp decline in its use of the Danube since the ports were opened up in 2023. In a press release, the consultancy stated that Ukraine will allow vessels up to 4.5 meters in depth to transit through the canal. The move will reduce the disbursement cost for shipowners, and help support negotiations regarding Danube-origin cargo by narrowing bid/offer differences," said Pavel Lysenko at ASAP Agri. The Seaport Authority has declined to comment. Last month, it announced that the Bystre had been closed after a dredger explosion on 23 July. It did not provide any further explanation. Traffic was diverted via the Romanian Sulina canal. ASAP Agri reported that the cost of using Sulina for shipowners was higher, and that many have raised their freight rates for Danube shipments in order to offset losses. It said: "Market participants expect a partial rebound in Danube cargo flows, as negotiations become more equalized." (Reporting and editing by Kevin Liffey; Pavel Polityuk)
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UK awards space launch license to Scottish firm
The UK has awarded its first space launch license to a Scottish rocket company. This will allow the Scottish startup to launch satellites from the first vertical launch site in the country. Skyrora was founded in 2017 and will be able launch up to 16 rockets per year. This is subject to the UK Civil Aviation Authority's (CAA) approval, the regulator announced on Tuesday. The company based in Scotland would launch rockets from the SaxaVord Spaceport, located in the Shetland islands, north Scotland. This site received a safety license last year and could therefore be used in the future. The Financial Times reported that SaxaVord told Skyrora there was no launch date available in 2025. Skyrora's Chief Executive Volodymyr Levykin stated in a press release that the firm was prioritizing a launch from Britain, but expected a delay. Levykin stated that despite having a vehicle and a license for launch, it was unlikely Skyrora would be able complete its launch in the UK this year. He said that the company could launch in Australia, Oman or Iceland. Rocket Factory Augsburg, a German company, was the first to receive a launch licence from SaxaVord earlier this year. Rob Bishton, CAA's Chief Executive Officer said: "Giving a homegrown company Skyrora its launch license is a significant milestone for our space industry and our nation." By 2030, the space market will be worth more than $1 trillion as companies from around the globe plan to deploy thousands internet-beaming Satellites. The British space industry employs more than 45,000 people, and produces more satellites outside of the United States. These efforts suffered a major setback in 2023, when a horizontal launch of a rocket from Newquay (south-west England) failed. SaxaVord's vertical launch would be a major boost to the industry. Skyrora must meet certain conditions before launching, including an adequate insurance policy, a data sharing agreement with the British Government, and agreements on airspace with other countries. (Reporting and editing by Sarah Young; Sachin Ravikumar)
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Mali: Islamist militants release Moroccan truck drivers detained since January
Mali's state media reported late Monday that militants affiliated with the Islamic State have freed four Moroccan truckers kidnapped back in January. This shows the growing intelligence collaboration between Mali and Morocco. A diplomatic source at the time said that in January, three men and their trucks vanished while traveling without escorts from Dori, Burkina Faso, to Tera, Niger. This area is known for its jihadist threat. State media broadcast footage of them with Assimi Goita, the leader of Mali's junta. The report said that they were freed Sunday. Burkina Faso led by the Junta, Niger and Mali battling militants linked to al Qaeda or Islamic State who have destabilised West Africa's Sahel for over a decade. All three countries have stopped their defence cooperation with France, and other Western forces. They now turn to Russia for support. Last year, they announced that they were withdrawing from the Economic Community of West Africa States. This increased the risk of diplomatic exclusion. Morocco has moved closer to three landlocked nations. In April, the Foreign Ministers of Burkina Faso Niger and Mali approved an initiative that offered them access to global commerce through Morocco's Atlantic port. Morocco also helped secure the December release of four French citizens who had been detained in Burkina Faso. According to Malian media, the release of four truck drivers on Sunday was the result of a collaboration between security and intelligence services in Mali and Morocco.
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Lufthansa cancels its plans to purchase a stake in Air Europa
A spokesperson for the German Group announced on Tuesday that Lufthansa had abandoned its plans to bid for an interest in the Spanish airline Air Europa. This comes only one week after Air France KLM also announced that it would be pulling out of the bidding process. Turkish Airlines is the only bidder known to exist. British Airways' owner IAG has a 20% stake but after years of discussions, failed to gain regulatory approval for the full takeover. After thorough analyses and intensive negotiations, at this point we have decided to refrain from further engagement in a capital contributions and shareholdings in Air Europa," said the Lufthansa spokeswoman. Globalia, a family-owned business that controls Air Europa, has declined to comment. Turkish Airlines has not responded to a comment request. Carsten Spohr, the chief executive of Lufthansa, said last week that negotiations over a possible stake at Air Europa would be difficult. Sources also stated that any proposed deal will be complex due to IAG's current stake. In the past, it was reported that the process had been delayed due to disagreements among members of the Hidalgo Family, who own Air Europa, as well as concerns expressed by interested airlines about the structure of this deal. Reporting by Ilona wissenbach and Joanna Plucinska. Additional reporting by Ceyda caglayan and Inti landauro. Editing by Inti landauro and Kirsten Donovan.
The majority of Gulf bourses follow the global rally as Fed's easement bets increase
Investors increased their bets on the U.S. Federal Reserve to support the world's biggest economy.
CME Fedwatch says that the soft U.S. payroll data on Friday has increased the odds of a Fed rate cut in September. This is a significant increase from the 63% chance it had at the beginning of the week.
The Fed's interest rate movements have a major impact on the Gulf Region's monetary policies because the majority of their currencies are pegged with the U.S. Dollar.
Dubai's benchmark index of stocks rose 0.6% on the back of gains in shares related to real estate, utilities, and industry sectors.
Emaar Properties increased by 1.5%, and Emirates Central Cooling Systems Corporation grew by 1.7%. EMPOWER, a provider of district cooling services, reported a 15.3% rise in net profit for the quarter attributable directly to shareholders.
Dubai's non oil sector also showed solid growth, with the PMI increasing to 53.5 from 51.8 in May, mainly due to a marked improvement in sales volume.
After two consecutive sessions in which it had fallen, the benchmark Abu Dhabi index gained 0.3%. This was boosted by an increase of 2.4% in Abu Dhabi Commercial Bank, and a gain of 1.3% in Burjeel Holding.
The benchmark Qatari index rose 0.2% thanks to a 1.3% increase in the telecom services provider Ooredoo, and a 0.8% rise in Qatar Islamic Bank.
Saudi Arabia's benchmark index rose 0.2% at the opening of trading. The majority of sectors, including IT, real estate, and healthcare stocks, were in positive territory.
ADES Holding grew 2.3%, while Elm Company, a digital security company, gained 3%. ADES, a Norwegian oil drilling company, has agreed to purchase Shelf Drilling from Oslo's listed rival for 3.9 billion Norwegian Crowns ($379.33 millions) in cash.
Saudi Aramco was, however, down by 0.3%. Aramco, the oil giant, reported a 22% decline in its second-quarter profits, due primarily to lower revenues, and increased debt. Reporting by Md. Manzer Hussain, Editing by Helen Popper
(source: Reuters)