Virgin Australia's back in black | IKEA's first sales drop in years | Adobe enters the AI race

This is lot of Flux.

I'm Brett and Justin As Wednesday, the sixteenth of October, Johnsie Boy, we spoke the other day about the XBS and payment terminals when you tap your card. Now the federal government is getting ready to outlaw debit cards surcharges. That means you pay for your five dollars twenty coffee with a debit card and you should be charged five dollars twenty None of these five dollars and thirty six cents, mumbo jumbo.

I never get that random number. So on Fox fam. As we hit the middle of October, there are only two more weeks until the cutoff to submit your tax return via Miga, and if you don't submit it for the end of October, you could be facing fines up to fifteen hundred bukaroonies. Thankfully, in the Flux app, we've got it all covered, all the steps you need to take if you want to submit your tax return, so make sure to check it out.

Three truly inspiring stories today, Jusy boy, let's do it for our first. Virgin Australia has seen its earnings jump by eighteen percent after it recorded its second profit in a row.

After a decad being in the Red b Man, these profits must feel extra sweet for Virgin right now, so tell me more.

Well, Jessie Boy, We've spoken about Virgin Australia a fair bit in the past twelve months. Most recently though, Qatar Airways acquired a twenty five percent stake of Virgin Australia, which is still subject to regulatory approval by the Bye the BEMN. After years of loss making and even going into voluntary administration under previous ownership, Virgin Australia has now

And be man, Virgin Australia has a pretty fat grin on his face right now because it's rival Quantus actually saw its earnings drop by seventeen percent.

Big big turnaround from the Big V after pretty much shutting up shop in twenty twenty.

In the last financial year it flew more than nineteen point two million passengers, and.

Josie Boy, Virgin Australia is planning to ramp up the pressure on Quantas even more if the Qatar Airways investment is.

Approved, particularly if it uses the wet leases.

And it's fair to say we need a bit of competition in the airline market, both domestic and international.

So what is the key learning here?

Strategic investments can transform an airlines balance sheet from red to black.

You see, be Man. While Virgin Australia has already performed strongly over the last couple of years, it now has the ability to leverage Qatar Airways through wet leases. Here's how it works.

One airline in this case Virgin sells seats on the flights operated by another carrier.

In this case Qatar Airways, but jes Wait.

While it's sold as a Virgin flight, Qatar would use its own aircraft and its own crew and be Man.

This works for Qatar Airways, who has capacity with a heap of planes.

And it works for Virgin Australia, who can sell more flights than it currently offers. And if Qatar's investment is approved, it could lead to twenty eight new flights a week to Doha from Sydney, Melbourne, Brisbane and Perth, as.

Well as potentially competing on other flights to London and Paris Rome Dallas.

Which quantus has no competition for right now.

For our second story, Ikea has dropped prices globally to attract more shoppers after its first revenue drop in four years.

The masters of the Allen key have finally hit a snag. Tell me more so, be man. Ikea is the.

Build it yourself furniture store started in Sweden back in nineteen forty three.

The names of its products are nearly as complicated as the assembly of its products.

But then, man, you've got to hand it to them. These flash pack makers just keep growing and growing and growing.

Until their last financial year.

Yeah, Ikea has announced sales of thirty nine point six billion euros globally for the last financial year to August.

And that's a five point three percent decline in revenue compared to last year.

And what was the reason for this drop? Bman, well does it boy?

The CEO said that they experienced a slow down of the home furnishing industry in all markets at the very same time.

And he reckons they haven't experienced anything like it since two thousand and.

Eight ahem, ahem, the global financial crisis.

And after they saw a decline in store visit, Ikea pulled the old strategic price cuts move to boost sales through its Amaze like stores and does boy.

Ike has announced it's likely to drop even more price cuts in the coming year.

Because it's raw material costs have dropped as well as those pesky softer economic condition So what is the key learning here? In an era of rising costs, cutting prices is a bold move that actually defies the market norms.

Well, we know that global inflation hit about eight point seven percent in twenty twenty two. In twenty twenty three, it was still over six and a half percent, and most retailers have used inflation as the perfect excuse to jack up prices. Looking at you, Coles and Wooally, the jazibait Ikea has taken an unconventional route by reducing prices despite these external pressures that they've got.

Yeah. The idea for Ikia is that if it can cut its costs while competitors are increasing, it can appeal to budget conscious consumers.

It may help them play the long game by focusing on building market chap rather than short term revenue and profits.

For our third and final story, Adobe has joined the AI race after launching an AI video generator that will see compete with the tech giants.

Adobe pulling out the biggest gun they've got. I want to know, Jazi Way, what or what is going on here? Adobe is the American design software co. It started in nineteen eighty two. It's probably best known for Photoshop or Adobe Illustrated products, which have been the bread and butter for designers for many many years.

Now be Man. Over the last few years, Adobe has been facing some pretty tough competition from the likes of Camber and Microsoft, who have entered and made a big splash in the design market.

And it's also been getting heat from big tech companies like OpenAI and Google who are stepping into the design market with their AI tools.

But now b Man, Adobe has come out with its own version of AI.

Yep, they've released a new AI video generator tool to help create and edit videos from text prompts.

For example, you could enter a prompt like create a poker game on the Sydney Harbor.

Bridge and basically it allows you to choose everything from the look of the people, the camera angles, the motions, the zoom in.

Or out and interestingly, be Man its models have been trained mostly on its own library of squillions of stock videos and images.

What a marvelous observation, Jesse Voice. I'm wondering what is the key learning here In the race to dominate the AI industry? Owning your own content can be a major compared advantage.

Is the thing.

Adobe is our big, big dog, but also pretty small player in the AI industry compared to tech giants like Meta or like Google.

But unlike those big dogs, Adobe owns a massive library of photo and video data that it can train its AI models on.

Which means it doesn't need to negotiate expensive licensing deals to legally access content that trains its models.

Yeah, we've already seen open Ai negotiate licensing deals with media and content companies like News Corp. And Reddit, Financial Times, Shutterstock and more so does it Boy?

Well, some tech companies have to show out millions to access content. Adobe can train its models on its own content, so.

There's less barriers in Adobe's way to launch its AI products and maybe even get ahead in the market. Yeah, Fox amm two more weeks to do the dreaded tax returns, but everyone puts off until the very end. We have it step by step, all covered in the Flux app. Add us of your tax return to make sure to download the Flux app and check it all out.

Thanks for listening, and we'll see you on Friday.