??Delta cancels hundreds flights due to Microsoft outage, Boeing pleads guilty to fraud conspiracy and more.

Hello, dear readers! ??We hope you had a great week.? Here's your weekly update on the latest news from finance and markets.

Elliott Management has acquired a significant stake in Starbucks and is engaging with its management to improve the company’s share price. Delta Air Lines CEO Ed Bastian apologized for thousands of flight cancellations following a global IT outage on Friday and offered frequent flyer miles to affected travelers. Electric car maker Rivian Automotive will go on trial over allegations that it encouraged former Tesla employees to steal trade secrets, according to a tentative ruling by a California judge. Boeing finalized a guilty plea for criminal fraud conspiracy and agreed to pay at least $243.6 million after breaching a 2021 agreement with the U.S. Justice Department, according to a court filing on Wednesday. Apple's smartphone shipments in China dropped 6.7% in Q2 2024 due to increasing competition from Huawei.

Stay tuned for more updates in the dynamic world of finance and markets! ??

Activist Elliott acquires significant stake in Starbucks, and engages with management

Elliott Management has acquired a significant stake in Starbucks and is engaging with its management to improve the company’s share price, according to the Wall Street Journal. Elliott, a prominent activist investor, did not hold a Starbucks stake as of its last disclosure on March 31. Following the news, Starbucks shares rose over 6% on Friday. The specific size of Elliott’s stake and its demands are unknown, but a settlement is possible. Starbucks has faced challenges, including an activist effort from workers unions and disappointing quarterly results with a 3% drop in U.S. same-store sales and a 7% decline in traffic. CEO Laxman Narasimhan, appointed by Howard Schultz, is under pressure to make store improvements. Schultz has commented on the company’s issues but has no plans to return as CEO.

Delta cancels hundreds flights due to Microsoft outage

Delta Air Lines CEO Ed Bastian apologized for thousands of flight cancellations following a global IT outage on Friday and offered frequent flyer miles to affected travelers. The disruptions, which drew criticism from Transportation Secretary Pete Buttigieg, resulted in over 4,600 canceled flights from Friday to Sunday, with another 700 canceled on Monday morning. Delta's cancellations made up more than half of all U.S. cancellations. Buttigieg demanded prompt refunds, reimbursements for food and hotel stays, and adequate customer service from Delta. While other airlines recovered, Delta continued to struggle, offering extra pay to flight attendants to cover shifts. The airline faced high demand during the busy summer travel season, making it difficult to rebook affected passengers. The outage, which impacted several Microsoft tools, including a crew tracking system, could cost Delta over $160 million.

Rivian to stand trial for alleged Tesla trade secrets theft

Electric car maker Rivian Automotive will go on trial over allegations that it encouraged former Tesla employees to steal trade secrets, according to a tentative ruling by a California judge. Judge Theodore C. Zayner of the Santa Clara County Superior Court tentatively denied Rivian's motion to dismiss the lawsuit, stating that Tesla presented sufficient evidence for a trial. The judge noted that some Rivian employees were not thoroughly investigated or disciplined. A final hearing is set for Wednesday in Santa Clara court. The legal battle began in 2020 when Tesla accused Rivian of poaching employees and misappropriating confidential information. Despite Rivian presenting evidence of its investigation, the judge found it inadequate. Rivian has denied the allegations.

Boeing pleads guilty to fraud conspiracy, agrees to $243.6M settlement

Boeing finalized a guilty plea for criminal fraud conspiracy and agreed to pay at least $243.6 million after breaching a 2021 agreement with the U.S. Justice Department, according to a court filing on Wednesday. The company allowed risky work at its factories and failed to ensure accurate and complete airplane record-keeping, leading the Justice Department to outline violations of the 2021 deferred prosecution agreement. On July 7, Boeing agreed in principle to plead guilty to defrauding the Federal Aviation Administration by knowingly misrepresenting key software for the 737 MAX. Boeing confirmed it had filed a detailed plea agreement with the Justice Department, stating its commitment to work transparently with regulators and strengthen safety, quality, and compliance programs. The Justice Department noted in May that Boeing breached the agreement, which protected it from criminal prosecution for misrepresentations about software linked to fatal 737 MAX crashes in 2018 and 2019, resulting in 346 deaths. This finding followed a January in-flight panel blowout on an Alaska Airlines 737 MAX, highlighting ongoing safety and quality issues just before the agreement's expiration.

Apple's China smartphone shipments fall 6.7% as Huawei rises

Apple's smartphone shipments in China dropped 6.7% in Q2 2024 due to increasing competition from Huawei. Apple shipped 9.7 million units, down from 10.4 million last year, while Huawei's shipments rose 41% to 10.6 million, boosted by its new Pura 70 series. As a result, Apple's market ranking fell from third to sixth. China's overall smartphone shipments increased by 10%, with Vivo leading at 19% market share, followed by Oppo, Honor, and Huawei. To boost sales, Apple launched aggressive discount campaigns, offering up to 2,300 yuan ($318.84) off select iPhone models. Analysts expect Huawei's strong performance to continue.

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