Delta Air Lines may just be the wind beneath the entire industry’s wings.

In its second-quarter earnings report on Thursday, the Atlanta-based carrier reinstated a full-year profit forecast and cited a notable rebound in travel demand. Its share price, unsurprisingly, took flight following the news — with its industry peers lining up on the runway for takeoff just behind it.

A Turbulent 2025

There were some rough skies for a couple of months there, but Delta seems to think it has now punched through to the other side. Economic uncertainty triggered by the trade war kneecapped US consumer confidence, stifling domestic demand. Meanwhile, a sudden PR problem had foreigners rethinking any potential travel plans to the USA. Then there were incidents including a fatal collision in Washington that sparked fears of widespread air traffic control problems. And did we mention yet that business travel is still down as much as 20% from pre-pandemic levels?

In April, Delta became the first major airline to flick the seatbelt sign on, pulling its outlook for the year as the stormy clouds of “Liberation Day” announcements rattled financial markets. The rest of the industry soon followed suit — and has paid the price. Through Wednesday, the S&P Supercomposite Airlines Index had fallen 16% year-to-date, compared with the 6.5% ascent of the overall index.

Now? Delta sees itself pulling out of the tailspin and getting back to cruising altitude — though it still won’t quite be able to make up all the ground it lost:

• Delta reported a $2.1 billion profit in its second quarter, beating analyst expectations and topping its performance in the same quarter a year ago by a full 63%. It also projected better-than-expected results for its next quarter and announced a new earnings outlook for the year of $5.25 to $6.25 a share (better than no guidance, but still down from the $7.35 a pop it projected as the year took off in January).
• The reason for the optimism? Stabilizing demand, specifically among high-income consumers who continue to splurge on international travel and premium tickets. While Delta said main cabin sales fell 5% in the second quarter, premium ticket sales soared 5%.

“Premium has certainly been where our margins have continued to expand, and so we’re highly focused on continuing to provide improved service to those customers and more segmentation,” Delta President Glen Hauenstein said on the company’s earnings call Thursday.

Taking Flight: Shares of Delta closed up 12% on Thursday following the good news. The rest of the industry caught its tailwind: United soared 14%, American climbed 12% and Southwest added about 8%, as did Alaska and JetBlue. Still, some analysts caution against getting too enthusiastic over the news. “Delta’s guidance is encouraging for other full-service carriers, but we would hesitate on overextrapolating the guidance for airlines without premium/diverse revenues,” TD Cowen analyst Tom Fitzgerald wrote in a note Thursday.

The rare earths sector’s magnetism has been undeniable lately.

Now, the US Department of Defense is set to become the largest shareholder in Las Vegas-based MP Materials, the owner and operator of the only working rare earth mine and processing facility in the country. The company announced on Thursday that, in addition to US taxpayers footing a $400 million stake and a $150 million loan, the Defense Department has agreed to purchase all of the magnets the company produces from a planned new facility for 10 years. CEO James Litinsky pledged in a CNBC interview that “the taxpayers are going to make a lot of money” for their generosity.

Monster Magnet Deal

In case you need a primer, rare earths are 17 elements crucial in compounds needed to make magnets that serve as components in a boggling range of important things. That includes renewable energy technology like solar panels, electric cars, and wind turbines as well as the rechargeable batteries that power smartphones and tablets, and — here’s where the senior officers at the Pentagon start salivating — key defense technologies from radar and sonar to fighter jets and submarines.

The catch is that one country, China, dominates mining and production. The country accounts for nearly two-thirds of raw material production and 90% of the manufacturing of rare earth magnets. The US, meanwhile, relies on imports of rare earths, with almost 70% coming from China. And, as you may recall from the brain-rattling abundance of geopolitical news this year, the US is currently embroiled in a trade standoff with the Middle Kingdom. Indeed, China has used rare earth export controls as a bargaining chip in ongoing negotiations. Enter the deal with MP Materials, which Litinsky emphasized is a “public-private partnership” and “not a nationalization.” Whatever you call it, some of the terms could be generously described as favorable to the company:

• The Pentagon will purchase a newly created class of preferred shares that can be converted to common stock, plus a warrant convertible at $30.03 per share, which would allow the US to buy more common stock over a 10-year period. Exercising both would give US taxpayers a roughly 15% stake in MP Materials, almost twice the size of Litinsky’s 8.6% stake and Blackrock Fund Advisors’ 8.3%.
• As part of the deal, MP Materials will build a second magnet manufacturing facility, slated to begin operations in 2028, dubbed 10X. This facility will join the existing one at its Mountain Pass mine in California’s Clark Mountains, increasing its annual rare earth magnet manufacturing capacity to 10,000 metric tons. The US has agreed to buy all the refined neodymium-praseodymium oxide, or NdPr, that MP Materials produces from 2028 for 10 years at $110 per kilogram, a price well above the metal’s spot price and historical average (currently, it’s roughly $63).

Making Up for Losses: In addition to the $150 billion loan from taxpayers, the company is set to receive $1 billion in financing from JPMorgan and Goldman Sachs to build the new facility. With all that public and private firepower behind it, MP Materials’ shares rose a whopping 50.6% on Thursday. On the other hand, the company could use the helping hand because of the US-China trade standoff: When the two countries slapped sky-high retaliatory tariffs on each other earlier this year, MP Materials was forced to halt shipments to its biggest customer, China’s Shenghe Resources, which accounted for 80% of its revenue last year.

Nutella-covered Froot Loops could become a thing now that Ferrero’s buying WK Kellogg for $3.1 billion. The Rice Krispies-maker’s shares did “Gr-r-r-eat” yesterday, popping 30% as investors backed the Italy-founded company’s takeover of American breakfasts.

Ferrero previously bought Nestlé’s US candy biz for $2.8 billion, as well as chocolate-maker Fannie May and RedHots owner Ferrara — considering the name, it was inevitable. The Italian company is now the US’s third-largest candy seller, behind Hershey and Mars, according to Evercore ISI.

Ferrero has also brought over brands that Americans used to visit the EU to buy (Kinder Bueno, Joy Eggs) and Americanized a couple of its products: Dr Pepper Tic Tacs and Nutella Peanut.

Part of an Incomplete Breakfast

Sugary cereals never left the ’90s as shoppers switched to healthier and higher-protein breakfast options with fewer artificial food dyes. And in recent years, inflation has pushed cereal buyers to opt for more affordable private-label brands (Shredded Wheat instead of Mini-Wheats). WK Kellogg reported that its sales fell 6% in the first quarter and cut its annual guidance, citing “weaker than expected consumption trends.”

The company has been going soggy for a while:

• In 2023, Kellogg spun off its struggling cereal biz as WK Kellogg and renamed itself Kellanova to focus on its snack portfolio (Pringles, Cheez-Its). Though both companies have struggled with scrimping shoppers, Kellanova’s sales weren’t hit as hard as WK Kellogg’s last quarter.
• Ferrero’s competitor Mars is betting on snacks over cereal. Mars announced in August that it’ll buy Kellanova for $36 billion, and the deal was approved by the FTC last month — it’s still facing antitrust scrutiny in the EU.

Experts don’t think regulators will challenge Ferrero’s deal since it’s significantly smaller, and Ferrero isn’t a major player in the cereal aisle.

Milking It: The campaign to get Americans to eat more cereal is underway. WK Kellogg CEO Gary Pilnick encouraged Americans to eat cereal for dinner last year (the comment caused some PR drama), citing company data showing a quarter of consumers already eat cereal outside of breakfast time. WK Kellogg’s has also tried turning its cereals into snacks, launching grab-and-go bags of brands like Froot Loops and Apple Jacks as well as cereal bars.