Business
After failing to secure a bail-out from the American government, Spirit Airlines abruptly cancelled all its flights and began to unwind its assets. The company’s financial officer said it would try to sell the aircraft it owns outright but would abandon the planes to lenders if it cannot. The low-cost carrier had hoped to leave bankruptcy protection in the coming months. But the increase in jet-fuel costs as a result of the Iran conflict worsened its financial position. It had struggled with its debt burden for several years. A proposed merger with JetBlue was blocked on antitrust grounds in 2024.
Other airlines have been forced to cut or rejig flight schedules because of higher fuel prices. Meanwhile, the chief executive of Chevron became the latest voice to warn of an impending global shortage of oil supply because of the lengthy closure of the Strait of Hormuz. Mike Wirth noted that Asia and Europe would be hit hard, and that it would take a bit longer for America to feel the effects.
Shell reported its best quarterly profit in two years as its trading desk benefited from the volatility in oil markets. It expects a big fall in gas production for the second quarter, however, because of the Iran war. Chevron and ExxonMobil reported a drop in profit despite higher oil prices, but both pointed out that this was to do with the timing of financial hedges.
Battling a surge in inflation driven by costlier energy, Australia’s central bank raised interest rates for the third time this year, lifting its base rate by a quarter of a percentage point, to 4.35%.
Berkshire Hathaway held its first shareholders annual meeting with Greg Abel as chief executive. Investors grilled him about what he intends to do with the nearly $400bn cash pile amassed under his predecessor, Warren Buffett. Mr Abel said he was in no rush to make acquisitions, as he was “not anxious to deploy capital into subpar opportunities”.
America’s Securities and Exchange Commission began a 60-day consultation process on its proposal to allow stockmarket-listed companies to publish their earnings every six months instead of every three. Supporters of the reform contend that the requirement to release statements on revenue and profit every quarter leads to short-term thinking among managers. Those who favour the current system say six months is too long a gap between reports, which provide investors with solid evidence about a company’s performance.
GameStop, a video-games retailer that is perhaps best known as a meme stock, announced an unsolicited bid for eBay, in which it has built a 5% stake. GameStop put the equity value of its bid at nearly $56bn, which is vastly more than its own market capitalisation. Asked how he would make the sums add up to finance the takeover, Ryan Cohen, GameStop’s chief executive, said “we’ll see what happens”.
Hong Kong’s economy grew by 5.9% in the first quarter, year on year, the strongest pace since the second quarter of 2021. The global mania for AI has boosted demand for Hong Kong’s related products and electronics, according to the city’s financial secretary. Goods exports were up by nearly 24% in the quarter.
AMD’s share price soared after the chipmaker reported a 57% rise in sales to data centres in the first quarter compared with the same period a year ago. Overall revenue jumped by 38%. AMD’s earnings along with other tech-related news spurred the S&P 500 and NASDAQ Composite to new highs. Samsung’s market capitalisation passed $1trn for the first time on the back of strong demand for its memory chips, which helped push South Korea’s KOSPI stockmarket index to another record.
Investors were also pleased by Apple’s earnings. Revenues from the iPhone rose by 20% in the first three months of 2026, year on year, driven in large part by demand for the iPhone 17 in China. Total revenues came in at $111.2bn, more than half of which came from the iPhone. Apple is expected to launch a foldable phone later this year. Meanwhile, Apple agreed to settle for $250m a class-action lawsuit that alleged it misled users about AI capabilities on the iPhone 15 and 16. The company did not admit any wrongdoing.
The American government’s Centre for AI Standards and Innovation, better known as CAISI, signed agreements with Google DeepMind, Microsoft and xAI that will allow it to study the national-security implications of new AI models before they are released to the public. The agreements build on similar deals struck during the Biden administration.
More than 2m prescriptions were filled in the year to April 17th for Novo Nordisk’s Wegovy pill, which went on sale in America in January. The company raised its outlook, as it now expects higher revenues from weight-loss treatments. It hopes to start selling the Wegovy pill outside America later this year. However, Eli Lilly, Novo’s main competitor, is threatening to eat its lunch again by releasing a rival weight-loss pill, Foundayo.