🛫 Spirit’s premium push

…and P&G’s brand-name blues (AaronP/Bauer-Griffin/Getty Images) Go Big or just Go   Sponsored by Yesterday's market moves Dow Jones 40,743 (+0.50%) S&P 500 5,436 (-0.50%) Nasdaq 17,147 (-1.28%) Bitcoin $66,211 (-0.84%) Dow Jones 40,743 (+0.50%) S&P 500 5,436 (-0.50%) Nasdaq 17,147 (-1.28%) Bitcoin $66,211 (-0.84%) Hey Snackers, “Brat” memes, merch, and political slogans are fueling the latest generational [slang divide](. And Gen Z only just got a break from nonstop requests to explain “rizz.” The S&P 500 and Nasdaq [slipped]( yesterday, tugged down by tech. Investors expect the Fed to hold interest rates steady at its meeting today, and to start cutting in September.   GO-BIGGER [Bare-bones carrier Spirit rolls out a perk-filled tier to compete with premium airlines]( The lap of (budget) luxury… Spirit Airlines, the US carrier known for cheap fares and spartan service, is trying to [fly upmarket](. The airline, which charges extra for bags, seat selection, and even water, is introducing a fare where those perks are included. Spirit’s “Go Big” package (its highest-priced tier) only gets you a roomier seat at the front. But starting next month the biz said the package would include free Wi-Fi, a checked bag and carry-on, and “unlimited” snacks and beverages (including booze). It’ll offer four fare options, ranging from Go Big (most perks included) to Go (you pay for water). It could all help Spirit compete with larger rivals like Delta and United as it struggles to turn a profit. - Low spirits: Spirit recently warned of a bigger-than-expected quarterly loss after revenue from add-on fees came in a lot lower than anticipated. - Checked out: European budget rival Ryanair earlier this month said its quarterly profit plunged 46% despite a surge in travelers. It blamed lower fares. Lots of empty middle seats… It’s not that travel demand is cooling. Quite the opposite: this summer’s expected to be historic for air travel, and the International Air Transport Association predicts the industry will earn nearly $1T in sales this year — a record. But while demand’s hot, fares are not: carriers are struggling with weak ticket prices in an oversupplied US market. Airfare prices are down 5% from a year ago, and Delta’s boss urged low-cost carriers to stop oversupplying seats. - Lower fares + higher costs are hitting airline profits. Delta posted [disappointing]( earnings this month after its percentage of seats filled slipped last quarter. THE TAKEAWAY More options = more profit potential… By expanding its tiers to four, Spirit could be better poised to compete with non-budget rivals, which offer everything from basic economy to first class (psst: the real profit-maker). Southwest is making a similar play, announcing this week that it’ll shift to assigned seating for the first time (allowing it to charge extra for seat selection). By expanding fare options, airlines hope to attract a wider variety of customers. [Read this online]( Sponsored by Sector SPDR ETFs The future of A.I. could impact all technology companies. Why continue to take single stock risk? [The Technology Sector ETF (XLK)]( provides investors access to the technology stocks in the S&P 500, all encapsulated within a single security. Why continue to take on the risk of single stock exposure, when you can own the entire technology sector of the S&P 500? Learn more about the [Select Sector SPDR Fund XLK](. Advertiser’s disclosure: All ETFs are subject to risk, including possible loss of principal. Sector ETF products are also subject to sector risk and non-diversification risk, which will result in greater price fluctuations than the overall market. An investor should consider investment objectives, risks, charges and expenses carefully before investing. To obtain a prospectus, which contains this and other information, call 1-866-SECTOR-ETF (866-732-8673) or visit [www.sectorspdrs.com](. Read the prospectus carefully before investing.ALPS Portfolio Solutions Distributor, Inc., a registered broker-dealer, is distributor for the Select Sector SPDR Trust. Sponsored by Sector SPDR ETFs The future of A.I. could impact all technology companies. Why continue to take single stock risk? [The Technology Sector ETF (XLK)]( provides investors access to the technology stocks in the S&P 500, all encapsulated within a single security. Why continue to take on the risk of single stock exposure, when you can own the entire technology sector of the S&P 500? Learn more about the [Select Sector SPDR Fund XLK](. Advertiser’s disclosure: All ETFs are subject to risk, including possible loss of principal. Sector ETF products are also subject to sector risk and non-diversification risk, which will result in greater price fluctuations than the overall market. An investor should consider investment objectives, risks, charges and expenses carefully before investing. To obtain a prospectus, which contains this and other information, call 1-866-SECTOR-ETF (866-732-8673) or visit [www.sectorspdrs.com](. Read the prospectus carefully before investing.ALPS Portfolio Solutions Distributor, Inc., a registered broker-dealer, is distributor for the Select Sector SPDR Trust.   WASHED [Tide parent P&G sees its slowest sales in years as private-label store brands thrive]( Stuck on diaper duty… Shares of Procter & Gamble dropped 5% after the Pampers maker posted its worst sales growth in six years. P&G is a consumer-staples bellwether that owns dozens of household brands, including Crest, Charmin, Pantene, and Tampax. Though it beat Wall Street’s expectations, P&G’s quarterly profit fell 7% to $3.1B as demand cooled for its baby-care lines (like Luvs diapers) and luxury Japanese skincare brand SK-II. Organic sales in China (P&G’s No. 2 market) fell 9% as the country grapples with a slowdown in consumer spending. Yet it wasn’t all bad: - Cleaned up: P&G’s sales volume rose for the first time in over two years, thanks to stronger growth in hair, home care, and grooming (think: Gillette and Venus razors). - Checked out: P&G said its prices grew only 1% for the quarter — the lowest increase in nearly three years — as companies try to lure back inflation-weary shoppers. KitKat copycats… After years of price increases, companies have recently eased on hikes as folks start cutting back on brand-name products. Last week, Gerber and Purina owner Nestlé lowered its annual sales forecast after prices came down. Kleenex and Scott TP maker Kimberly-Clark also missed sales expectations, partly because retailers were stocking up on store-brand versions of tissue products. Private-label sales hit a record $236B last year, up more than 30% from prepandemic levels. THE TAKEAWAY Staples aren’t as sticky as usual… In uncertain economic times, investors tend to look to “safe haven” consumer staples because folks always need essentials like toothpaste, TP, and dish soap. But after brand-name inflation, spending has shifted: 65% of US shoppers said they’re choosing cheaper private labels over national brands. Retailers are listening: in May, Target [said]( it’d cut prices on 5K+ products, and Walmart [rolled out]( its first new private store brand in two decades. [Read this online](   ON SHERWOOD Getty Images [The industry blasting your phone with spam calls and texts is about to implode]( The feds could throw a wrench into the opaque, sometimes sketchy, and incredibly lucrative lead-generator industry. [Read more.](   What else we're Snackin' - [Soft](: Microsoft unboxed better-than-expected sales and profit growth, but the stock dropped 6% after its cloud biz fell short of analysts’ projections (though cloud was still the fastest-growing unit). - [Bux](: Starbucks saw its same-store sales fall for the second straight quarter as consumers pulled back on $5 cold brews and lattes. Food chains are turning to discounts to lure back customers. - [Baggage](: Delta reportedly plans to seek damages from CrowdStrike and Microsoft over this month’s massive IT outage. Delta canceled ~7K flights and saw 176K refund requests. The ordeal could cost it $500M. - [Gold](: TV ratings for the Paris Olympics are up 79% over 2021’s Tokyo Games, with an average 34.5M people watching over the first three days. NBC said its streamer, Peacock, helped draw in viewers. - [Thread](: Attempts to woo advertisers back to X haven’t gone great. The biz is said to have logged $114M in Q2 revenue in the US, down 53% on the year. It’s hoping the Olympics and politics give it a boost.   Snack Fact of the Day [America’s gross national debt just eclipsed $35T for the first time](d   Wednesday - US Fed’s interest-rate decision; Powell’s press conference - ADP employment data - Earnings expected from Boeing, Norwegian Cruise Line, Kraft Heinz, Altria, Teva Pharmaceutical, Wingstop, Humana, Mastercard, Scotts Miracle-Gro, AutoNation, GE HealthCare, T-Mobile, Garmin, GlaxoSmithKline, Penske, Bausch + Lomb, DuPont, HSBC, Steve Madden, Meta, Qualcomm, Carvana, Etsy, MGM Resorts, eBay, Cheesecake Factory, and Herbalife Authors of this Snacks own shares of: Comcast, Delta, Kraft Heinz, Microsoft, Norwegian Cruise Line, Starbucks, and Walmart   [Instagram]( [Twitter]( [Sherwood Logo](sherwood.news) Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate... 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