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Alaska Air reduces annual profit forecast due to higher fuel costs
Alaska Air Group cut its profit forecast for 2025 on Thursday due to higher fuel prices and operational challenges including adverse weather. Analysts also expected the carrier's fourth-quarter profits to be well below analyst expectations. Fuel prices have soared as a result of refinery outages along the U.S. West Coast. This has added pressure to airlines who are already struggling with increasing operating costs. Alaska Air's CFO Shane Tackett said that fuel is volatile and it was difficult to estimate earnings for the fourth quarter. Storms and an overstretched air traffic control system have led to costly disruptions in the U.S. aviation industry this year. The company expects to achieve an adjusted annual profit per share of at least $2.40 compared to its previous forecasts of more than $3.25. According to LSEG, it also expects a fourth-quarter profit adjusted of at least forty cents per share. Analysts had estimated 88 cents. Alaska Air also suffered a major IT failure in July. This caused hundreds of flights to be cancelled and thousands of passengers to be stranded during the busy summer travel season. The industry has begun to see some results from its efforts to reduce seat supply, and to counter the discounting pressures that followed a slump in demand during the first half year. Tackett stated that "we expect positive unit revenue in the fourth quarter." The company's yields - a key indicator of pricing power - rose by about 1.4% during the quarter ending in September. However, its unit costs, excluding fuel, increased by about 8.6%. He added that "costs will improve meaningfully sequentially on an unit cost basis" from Q3. The company reported a quarterly profit adjusted at $1.05 per share. This was below the analysts' average expectation of $1.13 each. Total operating revenue for the third quarter rose by 23%, to $3.77billion from $3.76billion a year earlier. This was higher than expected. Reporting by Shivansh Tiwary, Rajesh Kum Singh and Shreya Biwas; Editing by Alan Barona and Shreya Barona
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Alaska Airlines cancels all flights due to a technology failure
Alaska Airlines, a U.S. airline, said that it has grounded all flights in its airports due to a technology problem. A Federal Aviation Administration (FAA) advisory revealed that the ground stop was also applicable to Alaska Airlines subsidiary Horizon Air. According to the advisory, the ground stop request was for a duration of 1 hour and 10 minutes ending at 0000 GMT. A computer outage also caused the airline to temporarily ground all flights for three hours in July. Alaska Airlines is currently experiencing an IT issue that affects operations. Temporary ground stops are in place. Alaska Airlines apologized for any inconvenience. Customers who posted complaints and concerns online were also addressed by the airline via social media. It said that the IT team was working hard to resolve this issue as quickly as possible. This was in response to a user on X who had asked if there were any issues with the airline's mobile app. A user had asked the airline about problems with bookings on its website. The response was similar. (Reporting and editing by Muralikumar Aantharaman, Jamie Freed and Kanishka Shakil)
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FAA delays flights in New York City, Houston, and Washington
The Federal Aviation Administration announced late Thursday that staffing problems at air traffic control are causing delays in airports such as New York, Washington DC, Newark, and Houston. This comes as the U.S. Government shutdown enters its 23rd consecutive day. The FAA reported staffing problems at 10 locations, and announced ground stops in Houston Bush and Newark Airports. The average delay for flights at Ronald Reagan Washington National Airport was 31 minutes, while delays at New York LaGuardia airport were 62 minutes. The government shutdown will require 13,000 air traffic control officers and 50,000 Transportation Security Administration agents to work without pay. FlightAware is a website that tracks flights. It reported Thursday that more than 4,200 U.S. flight delays occurred, including over 15% at Reagan, Newark, and LaGuardia airports and 13% at Bush. The federal government is concerned that controllers' absences could increase during the weekend. On Tuesday, controllers will not receive their first full pay. White House Press Secretary KarolineLeavitt warned that there would be "significant flight delays, disruptions, and cancellations" in major airports throughout the United States during this holiday season. Democrats deny that they are to blame and claim it's President Donald Trump and Republicans refusing to negotiate. The debate about the shutdown has shifted to the air traffic control system, with both sides blaming each other. Both unions and airlines are calling for a swift end to the shutdown. During a 35-day government shutdown in 2019, the number of controllers and TSA agents absent increased as they missed paychecks. This led to longer waits at checkpoints. The authorities were forced to slow down air traffic in New York City and Washington. This put pressure on legislators to end the standoff. Even before the shutdown, many air traffic controllers were working six-day weekends and mandatory overtime. (Reporting and editing by Leslie Adler, Lincoln Feast, and David Shepardson.)
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Norfolk Southern's strong merchandise volume helps it to beat its quarterly profit target
In its first earnings report following the announcement of the merger between Union Pacific and Norfolk Southern, the U.S. railroad company beat Wall Street's expectations for the third quarter profit. Mark George, CEO of Osiris Group, said in an earnings call that while the impact was not significant in the third-quarter, the reaction from competitors to the merger announcement had begun to affect revenue. Surface Transportation Board approval is required for the deal that drew positive feedback from U.S. president Donald Trump. Norfolk reported lower quarterly volumes for its coal and intermodal segments. Trump's tariffs are causing a decline in the freight market and consumer markets. This is affecting railroads. In the earnings call, company executives noted that coal prices are still under pressure due to uncertainty surrounding export trade. They also stated that they expect that utility demand will continue to be supported by growing electricity consumption as well as lower coal stockpiles. The volume of coal shipped by railroad operators has fallen due to a weakening demand, as consumers switch to natural gas which is cheaper. According to data compiled and analyzed by LSEG, Atlanta-based Norfolk posted an adjusted profit per share of $3.30 for the third quarter. This compares to analyst estimates of $3.19, which were based on LSEG's data. The company's total operating revenues for the third quarter increased by 2%, to $3.1 billion. This was in line with analyst expectations. The company's adjusted operating ratio, which is a key indicator of efficiency, was 63.3% during the third quarter. This represents a 10-basis point improvement over the same period in the previous year. Union Pacific's strong coal volume helped it to surpass Wall Street profit estimates earlier on Thursday. Last week, CSX, a peer, beat estimates for the quarter on improved intermodal volumes, higher prices in its merchandise segment and lower coal prices.
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Mexican President says US players are involved in fuel smuggling
Mexico's president Claudia Sheinbaum stated on Thursday that U.S. citizens are involved in the smuggling of fuel into the country. This follows an investigation into the illegal trade which revealed how the narcos had penetrated the North American Energy Sector. Sheinbaum responded to a question regarding the report by saying, "Yes, U.S. businesses are involved in the cases being investigated." Sheinbaum's regular morning press conference was in response. "One cannot understand how fuel from the U.S. enters Mexico illegally," Sheinbaum said during her morning press conference. The investigation published on Wednesday revealed that a Houston-based company, Ikon Midstream delivered diesel to Mexico, declaring it as lubricants, which are exempted from the high import duties levied against gasoline and diesel. Ikon Midstream's executive director Rhett Kenagy declined to comment on the story via their lawyer. Sheinbaum stated that she was unaware if Ikon Midstream had been involved in Mexican investigations relating to fuel smuggling. Two Mexican security sources said that Ikon Midstream's March tanker delivery of diesel to Mexico was part of an investigation into illicit trade. The White House didn't immediately answer questions regarding Sheinbaum’s remarks. Fuel smuggling is largely a tax avoidance scheme. Mexico levies an IEPS tax on many goods including gasoline and diesel imported from abroad. The tax is charged per liter, and can cost up to 50% of the value of the cargo. Crooks avoid the tax by claiming that the fuel imported from abroad is another type of petroleum product exempted from duty. According to Mexican and U.S. sources, the Jalisco Cartel is one of Mexico's strongest and most violent cartels. It is also the leader in crude oil and fuel smuggling. MEXICAN CRACKDOWN Sheinbaum has made fighting the illicit trade an important part of her security strategy. She said that Thursday, illegal imports had dropped due to her government's crackdown. She added that this was reflected in a higher sale of legal fuel. Sheinbaum has been in office since October 2024. Authorities claim they have seized around 500 barrels of crude oil and fuel that is allegedly illegal. This is more than what the previous government confiscated during its six-year tenure. Five current and former Mexican Government sources said that illegal imports accounted for up to one-third of the diesel and gasoline markets in Mexico. Sheinbaum stated that U.S. authorities were investigating the matter, but did not provide any details. Since September 2024 the U.S. Department of the Treasury’s Office of Foreign Assets Control issued two rounds of sanction against a dozen Mexican citizens and nearly thirty Mexican companies that are allegedly connected to CJNG, its fuel theft and smuggling activities. James Lael Jensen, father of Maxwell Sterling Jensen, and his son Maxwell Sterling Jensen were both charged in May with conspiracy to launder money and to provide material support to an designated foreign terrorist group. Authorities claim that the Jensens conspired with CJNG in order to smuggle crude into the United States. James Jensen's lawyers did not reply to an inquiry for comments regarding the investigation. Robert Guerra, an attorney representing Maxwell Jensen declined to comment. Three industry sources and an official from the United States said that U.S. officials met with refiners and other fuel producers in Houston this year to discuss the Mexican organized crime's involvement in the fuel industry and to emphasize the importance of knowing your suppliers and customers. This official said that anyone who violates U.S. sanctions anywhere in the supply chain may face criminal and civil penalties.
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ESA to study the impact of satellite merger
The European Space Agency announced on Thursday that it would examine a newly-announced satellite combination between the three aerospace groups in order to preserve a competitive environment. Director General Josef Aschbacher said at a press conference that ESA supports a strong industry, and that "mergers do happen". He added that when making future procurement decisions the agency will take into account the impact of this deal. When asked about the preliminary agreement announced on Thursday, he replied: "This is a good thing because it could make the industry stronger and more competitive on the global market." He added, "It'll change the landscape for competition. We will take that into consideration in our industrial policies and in the purchases we make." Airbus, a Thales-led venture and Leonardo's joint venture compete against Germany's OHB and Spain's Indra as well as startups such Finland's ICEYE. However, when combined they would dominate the European satellite market. The ESA will balance the interests of taxpayers and the strength of industry through competitions. Aschbacher stated that the ESA will work to ensure Europe has a "very-competitive industry ...(and (that) the European space sector would be strengthened by this move". (Reporting and editing by Kirby Donovan; Tim Hepher)
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Pakistan bans violent Islamist group for the second time in 4 years
The government of Pakistan announced that it had banned a violent Islamist group under its anti-terrorism laws on Thursday. This comes days after five people died in a clash between the group and police during an anti-Israel protest. The government of Pakistan said that the cabinet had approved the ban. Many Pakistani governments have been troubled by the violent and large-scale street protests of Tehreek-eLabbaik Pakistan, a far-right group. The radical Sunni Muslim movement founded in 2015 has been focusing on actions that it considers to be blasphemous. In 2016, it became a political movement that used blasphemy as a rallying call. After violent protests, the Imran Khan government banned the party in 2021. The government issued a statement by the Shehbaz Shairif office that said the ban would be lifted in six months if the group stopped using violence.
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US warns that flight disruptions could increase as the shutdown drags on
Transportation Secretary Sean Duffy, along with Republican leaders in Congress, warned on Thursday that flight delays could increase as the government shutdown enters its third day and controllers are not paid for their first paycheck. The government shutdown will force 13,000 air traffic control officers and 50,000 Transportation Security Administration agents to work without pay. The first full pay for controllers is not due until Tuesday. I can't promise that your flight will arrive on time. I can't promise that your flight won't be cancelled. Duffy told a Capitol Hill Press Conference that it would depend on the air traffic controllers showing up to work every day. He said that last week, the absence of air traffic controllers was responsible for 53% flight delays, compared to 5% in normal times. House Speaker Mike Johnson stated that the Federal Aviation Administration did not have the resources to pay air-traffic controllers. He called on Democrats pass legislation to reopen government. On Thursday, the Senate will consider a bill to pay essential employees during the shutdown. Democrats are demanding that Republicans approve new healthcare subsidies to help people purchase insurance under the Affordable Care Act. The debate about the shutdown has shifted to the air traffic control system, with both sides blaming each other. Both unions and airlines are calling for a swift end to the shutdown. Johnson: "Football lovers, if you're stuck in an airport this weekend as your team is about kickoff you can blame Democrats." In 2019, the number of controllers and TSA agents absent increased during a 35 day shutdown as workers missed their paychecks. This resulted in longer wait times at checkpoints. The authorities were forced to slow down air traffic in New York City and Washington. This put pressure on legislators to end the standoff. Even before the shutdown, many air traffic controllers were working six-day weekends and mandatory overtime to meet their staffing targets.
Norfolk Southern's profit increases by a quarter
In its first earnings report following the announcement of an $85 billion agreement to create the nation's only coast-to-coast rail freight operator, Norfolk Southern reported a higher third-quarter profit.
Surface Transportation Board approval is required for the deal that drew positive feedback from U.S. president Donald Trump.
Union Pacific's strong coal volume helped it to surpass Wall Street profit estimates earlier on Thursday. Last week, CSX, a peer company, beat Wall Street's quarterly estimates due to improved intermodal volumes, higher pricing and increased merchandise prices, which helped offset lower coking prices.
Union Pacific has said that it will file its merger application at the STB before the end of this year. The review may take between 12 and 18 months.
Norfolk, an Atlanta-based company in Georgia, reported a profit adjusted of $3.30 for the quarter reported, compared to $3.25 per share a year ago.
The total operating revenue of the company for the third quarter increased by 2%, to $3.1 billion compared to last year.
The company's adjusted operating ratio, which is a key indicator of efficiency, was 63.3% during the third quarter. This represents a 10-basis point improvement over the same period in the previous year.
(source: Reuters)