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Fed’s Hammack signals holding rates steady for months: report

admin — Sun, 21 Dec 2025 23:38:13 +0000

Federal Reserve Bank of Cleveland President Beth Hammack said she saw no need to change US interest rates for months ahead after the central bank cut borrowing costs at its last three meetings, the Wall Street Journal reported on Sunday.

Hammack opposed recent rate cuts as she is more worried about elevated inflation than the potential labor-market fragility that prompted officials to lower rates by a cumulative 75 basis points over the past few months, the report added.

Hammack told the Journal that the Fed didn’t need to change its benchmark interest rate, currently in a range between 3.5% and 3.75%, at least until the spring.

Federal Reserve Bank of Cleveland President Beth Hammack said the central bank does not have to cut interest rates in the coming months. REUTERS

By then, Hammack said, it would be able to better assess whether recent goods price inflation was receding as President Trump’s tariffs are more fully digested through the supply chain, the report said.

Hammack said that November’s consumer price index of 2.7% probably understated 12-month price growth due to data distortions, the report added.

“My base case is that we can stay here for some period of time, until we get clearer evidence that either inflation is coming back down to target or the employment side is weakening more materially,” Hammack told the Journal in a podcast interview recorded on Thursday, citing inflation concerns.

The Fed’s current benchmark lending rate is between 3.5% and 3.75%. Roman Babakin – stock.adobe.com

Speaking at an event in Cincinnati earlier this month, Hammack said she wanted to focus on high inflation and that she would prefer monetary policy to be tighter.

Hammack said the current policy rate was right, around a neutral level, but would prefer a slightly more restrictive stance to help put more pressure on inflation.

Hammack will be a voting member of the Federal Open Market Committee next year, which oversees important decisions regarding monetary policy and interest rates.

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On Holding (ONON) earnings Q2 2025

admin — Tue, 12 Aug 2025 13:29:24 +0000

On sales rose 32% in the Swiss sportswear company’s second quarter, leading it to raise its full-year revenue guidance even as it contends with new tariffs on imports from Vietnam.

The buzzy sneaker brand, which has been credited with taking market share from Nike, now expects full-year sales of 2.91 billion Swiss francs ($3.58 billion), up from its previous outlook of 2.86 billion francs. That’s in line with Wall Street expectations of 2.92 billion francs, according to LSEG.

On also raised its gross margin guidance to a range of 60.5% to 61%, compared with its previous outlook of between 60% and 60.5%.

Shares spiked about 17% in premarket trading Tuesday.

The company, which sources about 90% of its goods from Vietnam, raised prices on July 1 to offset the higher costs. It hasn’t seen demand slow down among wholesale partners or consumers, CEO Martin Hoffmann told CNBC in an interview.

“We have a lot of confidence in our lifestyle business, so we skewed the price increases more towards the lifestyle business, while trying to stay a bit more where we were on our running products,” Hoffmann explained. “So far, we don’t see negative impact from the price increases.”

The company, which has grown more than 30% in nearly every quarter since 2023, beat Wall Street’s sales expectations for the second quarter.

Here’s how On did in its second quarter compared with what Wall Street was anticipating, based on a survey of analysts by LSEG:

Loss per share: 9 cents in francs adjusted. The figure wasn’t immediately comparable to estimates.
Revenue: 749 million francs vs. 705 million francs expected

On’s net loss in the three months ended June 30 was 40.9 million francs or 12 cents per share, compared to a net income of 30.8 million francs, or 10 cents per share, in the year-ago period. The loss was primarily driven by foreign exchange fluctuations between the U.S. dollar and the Swiss franc.

Sales rose to 749 million francs, up 32% from 568 million francs a year earlier.

On, founded in Switzerland in 2010, has sought to become the most premium sportswear brand on the market. It is one of several companies that have been taking share from Nike, most notably in its running segment. The company draws a fraction of Nike’s annual sales, but it has garnered a reputation for innovation, a recent knock against the legacy sneaker giant.

In a sneaker category that’s been relatively soft in recent years, On has consistently grown sales in the mid-double digits and still has more room to grow given how low its brand awareness is in some parts of the world.

One key to the strategy has been balancing direct sales through its own website and stores and sales through wholesale. At a time when Nike pulled away from wholesalers, On and others filled that crucial shelf space while growing their store footprint and digital revenue.

During the second quarter, On’s wholesale and direct-to-consumer revenue both exceeded Wall Street expectations. On’s wholesale revenue was 441 million francs, compared to estimates of 429 million francs, according to StreetAccount. Direct sales were 308 million francs, compared to expectations of 279 million francs, according to StreetAccount.

Sales in the Americas; Europe, the Middle East and Africa; and the Asia-Pacific region all beat expectations, according to StreetAccount.

While On doesn’t break out its performance in China, Hoffmann said it’s been a bright spot for the company, as sales grew about 50% in the second quarter compared to the year-ago period.

“The American and the Chinese consumer is very strong for On,” said Hoffmann. “We have seen basically 50% same-store growth in our retail stores, even bigger growth in our [e-commerce] channel, and then the new stores come on top so … China is a very strong market for us.”

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Why first-class seats are holding up new airplanes

admin — Mon, 03 Mar 2025 06:32:21 +0000

A Lufthansa First Class “Allegris” cabin, which was set up outside the show.

Peter Kneffel | Picture Alliance | Getty Images

Heated or cooled seats. Ultra-high-definition TV screens. Benches. Convertible beds. All-aisle access. And of course, the coveted privacy door.

Ever-more luxurious first- and business-class cabins that have hundreds of parts and require regulator approval are the latest hold-up as new airplanes arrive late to customers, according to the heads of the world’s biggest airplane manufacturers.

Boeing has 787 Dreamliners, a twin-aisle jetliner used on some of the world’s longest flights, on the ground at its South Carolina factory “that are held up for delivery for the seats, which obviously go in pretty late in the assembly process,” CEO Kelly Ortberg said at a Barclays industry conference on Feb. 20.

Part of the problem is airlines’ rush to win over high-paying customers by offering comforts and more of the scarce space on board — even if a few extra inches.

“It’s getting the seats certified, and it’s not actually the butt part of the seat,” Ortberg continued. “It’s the cabinet and the doors … for first class and business class. These are pretty complex systems, and getting those certified has taken both the seat suppliers and us longer than anticipated.”

Similar issues are hitting Boeing’s main rival Airbus, the CEO of the European manufacturer, Guillaume Faury, said on an earnings call the same day.

“We have delays in seats” as well as cabin “monuments” like galleys and closets that are “delaying the time at which we can deliver a plane fully completed,” Faury said.

Together the companies account for the vast majority of the commercial airplane market.

Aircraft deliveries are crucial for manufacturers’ revenue because customers pay the bulk of a jetliner’s price when they receive the plane, rather than when they first order it.

A first-class compartment of a commercial passenger plane in the 1950s.

Authenticated News | Archive Photos | Getty Images

Pricier seats

Airlines and aerospace manufacturers are highly regulated, and new seat designs, some features and even cabin layouts must win approval from regulators before taking to the skies. Passengers also need to be able to safely exit those seats in the case of an emergency.

Some new aircraft cabins are still awaiting certification, and delays are adding to years of supply chain strains and labor shortages coming out of the pandemic.

In recent weeks, the Trump administration has fired hundreds of Federal Aviation Administration workers in a cost-cutting spree. The agency said the positions aren’t “safety critical,” but didn’t say whether staffing issues could further slow down aircraft or other certifications.

Getting the state-of-the-art seats installed at the front of the cabin means millions in revenue for airlines. For example, Delta Air Lines on Friday was selling a round-trip standard economy ticket between New York and Paris during the first week of May for $816. Move to Delta One, the carrier’s top-tier seat, and the same route jumps to $5,508.

New planes’ longer ranges compared with older models are opening up new nonstop routes for carriers.

“No one is happy right now,” about the delays, said Henry Harteveldt, founder of travel consulting firm Atmosphere Research Group. “They’re not able to get their new show ponies in.”

Members of staff display the first class cabin of a Qatar Airways Boeing 787, at the Farnborough International Air Show in Farnborough, England, Monday, July 22, 2024.

Alberto Pezzali | AP

A business-class seat can have about 1,500 parts, and weight is key, especially for an industry that has taken great pains to remove fuel-costing weight on board. That includes using thinner paper for seatback magazines to lighter cutlery.

Germany’s Recaro, a major airplane seat manufacturer, says its R7 business class seat weighs about 80 kilograms, or around 176 pounds.

“You’re trying to make everything as light as you can and also have a pleasing aesthetic value,” said Harteveldt.

Switzerland’s flag carrier, Swiss, said the center of gravity shifted in some of its aircraft after testing out its new seat models, so it has to make design changes and is looking at a “weight plate” before the new seats can fly commercially.

Customers “clearly signal to us that it is time to modernize the cabin interiors of our long-haul fleet, especially the [Airbus] A330,” a spokesman for Swiss said in an email. “At the same time, we are working on solutions and observing trends and technologies that could allow us to achieve a different and more useful weight distribution.”

Luxury travel boom

New business class seats cost in the low-six digits apiece, which “compares to the price of luxury car,” according to Recaro.

To airline executives they’re worth it. They say customers, especially after the Covid-19 pandemic, have shown they are willing to pay up to sit toward the front of the cabin.

Delta, for example, said in November that just 43% of its sales last year came from the main cabin, while 57% came from premium seats and its loyalty program. In 2010, 60% of revenue came from the main cabin.

CEO Ed Bastian told CNBC in January that the trend toward premium travel is likely to continue.

Airlines working to glow-up the front of their planes span the globe: Australia’s Qantas, Delta, American, JetBlue and others. Lufthansa’s new Allegris cabins on the Boeing 787s are held up in certification, a spokesman said.

Singapore Airlines said in November that it will bring first-class seats to its longest flights, more than 17 hours. CEO Goh Choon Phong said in a news release that the offerings will “push the boundaries of comfort, luxury, and modernity.”

A Singapore Airlines A380 first class suite

Leslie Josephs | CNBC

American Airlines, for its part, has been waiting for months to debut a new seat for its wide-body planes and just won approval for those on its 787-9 Dreamliner. A spokeswoman said the airline is working with regulators and that it plans to introduce the new suites on its Airbus A321XLR, a long-range version of a key Airbus plane, and its retrofitted Boeing 777-300ER later this year. It unveiled the seats in September 2022 and initially planned to debut them last year.

“The biggest thing I can say on all those fronts though is that we are dependent on the supply chain. Right now, that supply chain, especially in regard to seats, is very tight,” CEO Robert Isom said on an earnings call in October. He said the company’s message to suppliers and partners is: “‘Work with us to make sure that we get those — that equipment — on dock as expected,’ and we’re really pushing to make sure that that’s the case right now.”