Delta Air Lines is having a good 2025, reporting strong second-quarter earnings and reinstating its April profit guidance, leading to a substantial stock bump (up roughly 16% from June to July). True, its guidance is down from its January projections, but it’s weathering the storm of the tricky global economy well, maintaining its status as America’s leading premium airline. As Fortune‘s Shawn Tully reported in March 2025, it has somehow managed the trick of being America’s most profitable airline, while giving billions back to employees in the form of profit sharing.

At the start of the year, CEO Ed Bastian kicked off a celebration of Delta’s centenary by announcing “a new era in premium travel” with the opening of Delta One lounges, a step above its usual Sky Clubs. The Delta One locations will offer “amenities for the premium traveler” ranging from fine dining to spa-like wellness treatments and valet services. Bastian clarified that Delta will continue to invest in its Delta Sky Clubs, with more openings planned to come.

But there is more to the story for Delta, America’s leading premier airline. The Sky Clubs are coming off years of turbulence, with significant customer backlash following several of Delta’s attempts to improve a lounge experience that has become overcrowded. These problems date back several years, to the beginning of the “revenge travel” boom that accompanied post-pandemic reopening. Bastian told Fortune in 2022 that even he was shocked by the level of demand: “People talk about revenge travel, or pent-up travel—this is beyond anything that people can classify as truly pent-up,” he said, adding that his team calculated a whopping $300 billion burst of travel thirst. “That gap is $300 billion—with a B,” Bastian emphasized. 

America’s leading premium airline has long offered a standard lounge experience through its Sky Clubs, with free wi-fi, buffets of cold snacks and heated steam trays, and a range of complimentary drinks. The Sky Clubs were no match for the burst of revenge travelers. Bastian’s efforts to fix these problems in 2023—barring Basic Economy passengers and capping the number of visits allowed for credit card holders—sparked backlash on customers’ part and soul-searching for Bastian. “We are victims of our own success,” he told Fast Company‘s Stephanie Mehta in 2024, as he explained changes to benefits including access to Sky Club lounges. “It’s hard to tell someone who’s been at a certain status for many years that what they’ve earned is no longer as valuable.”

That’s why the declining pleasure of the airport lounge resonates for a deeper reason: it’s a metaphor for the declining prospects of the upper middle class in an age of “elite overproduction,” which argues that certain societies grow so rich and successful that they produce too many people of premium education for the number of premium jobs—or premium experiences—that the economy can actually support.

The elites have been so overproduced that you can literally see them—in lines stretching out of airport lounges.

The elite lounge overproduction theory

Several factors make Delta’s overcrowding issue particularly severe, and they have to do with how Delta is really trying—and, as Bastian says, succeeding—in offering a premium service to a large, affluent customer base. Delta offers more comprehensive food and beverage options than many competitors, so travelers linger longer, compounding capacity issues. Indeed, when reached for comment, Delta confirmed that its SkyMiles program has seen “unprecedented engagement,” and its member satisfaction is higher than ever. Delta said it’s committed to continuous investment to further please customers, which includes “modernizing and expanding our lounges.”

Generous lounge access deals with American Express (including non-Delta-branded Platinum Card holders) have greatly expanded eligibility, overwhelming facilities. As more travelers achieve status or purchase high-tier tickets, both due to credit card spending and business travel rebounds, demand for lounge space has increased beyond what legacy facilities can handle.

Delta isn’t alone in its lounge struggles, as shown by its partner, American Express, which has tried to physically expand many of its Centurion Lounges. Those have gone from the epitome of exclusivity and comfort to another kind of crowded waiting room—albeit with arguably better snacks and Wi-Fi.

The root of the problem is the same: too many people now have access. The proliferation of premium credit cards, airline status programs, and paid day passes has democratized lounge entry, eroding the exclusivity that made these spaces desirable in the first place. It is unclear if Delta expanded too far, too fast, or if it was surprised by the number of lounge lovers in its clientele. UBS Global Wealth Management has noted a surprising trend in the upper middle class: the rise of the “everyday millionaire,” or people whose assets fall between $1 million and $5 million. These are exactly the kind of people who would see themselves as lounge-worthy, and likely frustrated to find their small-M millionaire status doesn’t go so far.

The consequences for travelers are palpable. Social media and travel forums are rife with stories of travelers paying hundreds of dollars in annual fees only to find long lines clogging, say, New York’s JFK terminals on a daily basis. The proof is abundant on TikTok. On the other hand, expectations are heightened. Travel research firm Airport Dimensions has conducted an “airport experience report” for over a decade and found in 2024 that airport lounges are a contradiction: the definitive democratic travel luxury.

This widespread expectation—and dissatisfaction—is not just a matter of comfort. For many, the lounge was a symbol of having “made it”—a reward for loyalty, status, or financial success. Its decline has become a source of frustration and even embarrassment, especially for those who remember a more exclusive era. There’s an emotional trigger behind an unpleasant lounge experience.

The theory behind the malaise: elite overproduction

The overcrowding of airport lounges is more than a logistical headache—it’s a microcosm of a broader societal phenomenon. University of Connecticut professor emeritus Peter Turchin has developed a controversial theory of “elite overproduction” which posits that frustration and even instability result when a society produces more people aspiring to elite status than there are elite positions. It’s an unorthodox theory from an unorthodox academic: Turchin is an emeritus professor at UConn, research associate at the University of Oxford and project leader at the Complexity Science Hub-Vienna, leading research in a field of his own invention: Cliodynamics, a type of historical social science.

The catch with Turchin’s theory is that his own type of complexity science takes on a pseudo-prophetic quality, similar in some ways to William Strauss and Neil Howe’s “Fourth Turning.” And Turchin has foreseen that the United States has reached a stage repeated in civilizations throughout history, when it has produced too many products of elite education and social status for the realistic number of jobs it can generate. Decline and fall follows, Roman Empire-style. The Atlantic profiled Turchin in 2020, warning “the next decade could be even worse.” Several writers have expanded on his ideas since then, approaching it from their distinctive and different sensibilities.

Ritholtz Wealth Management COO Nick Maggiulli posted to his “Of Dollars and Data” blog on the subject of airport lounges specifically, writing that the “death of the Amex lounge” simply shows that “the upper middle class isn’t special anymore,” although he did not specifically link this to the concept of elite overproduction. “There are too many people with lots of money,” he concluded.

In the context of airport lounges, the “elite” are not just the ultra-wealthy, but the vast upper middle class—armed with a combination of higher degrees, status, and premium credit cards—now jostling for the same perks. But what if much of society has been turning into some version of an overcrowded airport lounge?

In an interview with Fortune Intelligence, Turchin said this theory makes sense and fits with his thesis when presented with the similarities. “The benefits that you get with wealth are now being diluted because there are just too many wealth holders,” he said, citing data that the top 10% of American society has gotten much wealthier over the past 40 years. (Turchin sources this statement to this working paper from Edward Wolff.)

Turchin said lounges are not by definition restricted from expansion in the same way that political offices are, with a core element of his thesis being there are too many sociopolitical elites for the number of positions open to them, but “it’s the same thing” in light of the difficulties many providers have in expanding lounge access. “There is a limited amount of space, but many more elites now, so to speak … low-rank elites.” Turchin said these low-rank elites, or “ten-percenters,” don’t have the status typically associated with elite status. “The overproduction of lower-ranking elites results in decreased benefits for all.”

When asked where else he sees this manifesting in modern life, Turchin said “it’s actually everywhere you look. Look at the overproduction of university degrees,” he added, arguing that declining rates of college enrollment and high rates of recent graduate unemployment support the decreasing value of a college diploma. “There is overproduction of university degrees and the value of university degree actually declines. And so the it’s the same thing [with] the lounge.”

Noah Smith argues that elite overproduction manifests as a kind of status anxiety and malaise among the upper middle class. Many find themselves struggling to afford or access the very symbols of success they were promised—be it a prestigious job, a home in a desirable neighborhood, or, indeed, a peaceful airport lounge. He collects reams of employment data to show that Turchin’s theory has significant statistical support from the 21st century American economy.

Freddie DeBoer largely agrees, framing the issue as “why so many elites feel like losers.” He focuses more on the creator economy than Smith, but asserts that he sees “think many would agree with me about “a pervasive sense of discontent among people who have elite aspirations and who feel that their years toiling in our meritocratic systems entitles them to fulfill those aspirations.”

Delta’s plan to restore status

In its lounge strategy, Delta is trying to walk a fine line: Offering a premium service to a class of consumers that is becoming more and more mass-market. CEO Ed Bastian acknowledged as much on the company’s latest earnings call. While touting the fortunes of Delta’s target customers, households making $100,000 or more a year, Bastian noted the income cutoff “is not, by the way, an elite definition—that’s 40% of all U.S. households.”

Beginning February 2025, Delta implemented new caps on annual lounge visits for American Express cardholders, setting a maximum of 15 visits per year and requiring exceptionally high annual spending ($75,000+) to re-unlock unlimited access. Basic Economy passengers, meanwhile, are permanently excluded from lounge access, further tightening entry. Travelers can only enter lounges within three hours of their flight’s departure time, discouraging extended stays and unnecessary early arrivals.

Delta is opening and upgrading lounges in key markets: New Delta One Lounges in Seattle, New York-JFK, Boston, and Los Angeles feature larger spaces, exclusive amenities, and new design concepts for premium passengers. Major expansions are under way in hubs like Atlanta, Orlando, Salt Lake City, and Philadelphia, with multiple new or enlarged clubs opening between spring and late 2025—some over 30,000 square feet in size, making them among the largest in the network. Renovations to existing lounges (e.g., Atlanta’s Concourses A and C) are aimed at maximizing capacity and improving guest experiences. Delta is also exploring emergency overflow options and flexible staffing to address unpredictable surges, especially during weather and operational delays.

Delta executives are optimistic. They predict that by 2026, most crowding issues—aside from extreme disruptions—will be resolved on “almost all days.” Continued investments in larger, better-designed lounges, coupled with tighter access controls, are expected to restore the premium experience customers expect.

However, critics note that crowding still occurs at peak times, especially in flagship locations, and design/layout flaws occasionally undermine even the newest clubs. The success of Delta’s fix-it agenda is being closely watched by both rivals and loyal travelers.

But Delta may be overmatched in rehabilitating the overcrowded airport lounge as a potent symbol of this broader malaise. What was once a marker of distinction is now a crowded, noisy, and often disappointing experience. The democratization of luxury, while laudable in some respects, has left many feeling that the rewards of success are increasingly out of reach—or at least, not what they used to be.

As airlines grapple with how to restore the magic of the lounge, they are also confronting a deeper truth: in an age of elite overproduction, the promise of exclusivity is harder than ever to keep.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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President Trump has suggested that as part of his tariff policy, he would consider sending out rebate checks or tariff refund checks to Americans, funded by the revenue collected from the tariffs imposed on imported goods. “We have so much money coming in, we’re thinking about a little rebate for people of a certain income level,” Trump told reporters Friday outside the White House. “A little rebate for people of a certain income level might be very nice.”

The rebate would be drawn from the significant amount of tariff revenue collected by the U.S. government—over $100 billion in the first half of 2025 alone, according to Treasury data.

Trump’s remarks about these rebate checks perhaps being targeted to Americans “of a certain income level” suggest they would likely be means-tested, but Trump offered few details about the exact income thresholds or amount of the rebate.

The stated purposes of the rebate are to compensate Americans who may have faced higher prices as a result of the tariffs and to potentially provide a small economic stimulus, which gives new meaning to Trump’s remarks about businesses “eating the tariffs,” with much economic debate over who is really footing the bill for them.

Any such rebate policy would likely require congressional approval, and lawmakers like Sen. Josh Hawley have indicated support for legislation that would deliver rebate checks to working Americans, but no bill text or timetable has been specified. If enacted, the administration would need to establish eligibility rules, application or automatic distribution methods, and payment logistics. This could resemble past stimulus check programs, but that is just theoretical at this point.

The rebate concept is distinct from legal or administrative tariff refunds to importers, which have been considered or mandated following court rulings questioning the legality of some tariffs. In such cases, refunds would go to the companies that paid the import duties, not directly to end consumers.

Is this legal?

Trump’s proposed tariff refund checks—rebates funded by tariff revenue and distributed directly to American consumers—would almost certainly require explicit legislation from Congress to be legally valid, given that the U.S. Constitution gives Congress—not the president—the power to levy tariffs and appropriate federal funds. 

The president can impose certain tariffs under delegated statutory authorities, but courts have repeatedly found that the sweeping use of these powers under the International Emergency Economic Powers Act (IEEPA) is not legal. Multiple recent court rulings (including a unanimous U.S. Court of International Trade decision) have blocked Trump’s broad tariffs for lacking legal basis under the IEEPA, yet the tariffs remain in place pending appeal and, theoretically, a Supreme Court ruling.

Trump’s busy July

The suggestion of tariff rebate checks or refund checks is another new policy suggestion from Trump in a July that has been full of them, as Washington, D.C., has been roiled by a metastasizing scandal involving disgraced deceased pedophile Jeffrey Epstein. Trump’s Justice Department is facing bipartisan criticism for its decision not to release the so-called Epstein files, which the Justice Department has said do not exist. The Wall Street Journal has published a series of scoops about Trump’s past closeness to Epstein, including Trump’s name being mentioned in the files.

In July, Trump said he had reached an agreement with Coca-Cola to bring real sugar back into the Coke formula, which the company partially confirmed days later. He also demanded the Washington Commanders football team revert to their former “Redskins” name, threatening political obstruction for their stadium project if they did not comply. He announced the release of 230,000 files related to Martin Luther King Jr. And he escalated his feud with the Federal Reserve and Chair Jerome Powell, visiting the in-process office renovations in a hard hat and engaging in a bizarre, comedic argument with Powell about cost overruns on live television.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

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Headline U.S. inflation jumped to 2.7% in June, its steepest rise in five months, according to the latest consumer price data. UBS Global Wealth Management took a look under the hood, writing in its monthly letter that “it’s quiet … a little too quiet.”

Chief investment officer Mark Haefele appealed to the cinephiles in his audience: “Movie fans will know that feeling of tension when the hero steps into supposedly dangerous new territory only to find nothing there.” The TACO traders are waiting for the next shoe to drop, tariffs are at their highest since the 1930s, and the Federal Reserve’s independence is threatened, he writes. Yet global stocks are at record highs, rate volatility is down, and credit spreads are tightening.

Haefele looked under the hood of headline inflation to isolate the reading for “core goods” in June, arguing that this is where the tariff impact is being revealed, as its June increase showed a two-year high. Much of the recent acceleration reflects price hikes in goods most exposed to the new tariffs—household furnishings, appliances, electronics, apparel, and toys. There’s also a lag between when tariffs are announced, when importers stockpile goods, and when stores finally pass those costs on to shoppers, meaning this should increase in coming months.

UBS Global Wealth Management

All about the lag

UBS Global Wealth Management notes that data in the weeks and months ahead will be key to determining whether core goods truly are surging, reflecting the impact of tariffs. Indeed, industries that rely heavily on imports are feeling the pinch first. Retail sales in categories such as electronics and home furnishings have dropped by 2% and 1.1%, respectively, once adjusted for inflation, as households begin to curb spending in response to higher prices. Conversely, overall retail sales volumes are still up 0.4% month over month, and consumer spending remains relatively resilient.

Who bears the burden?

A central question remains on tariffs: Who pays for them—exporters, importers, or consumers? Haefele cautions that it’s unclear how exporters, importers, or consumers will divide the economic costs. The split will likely differ by industry, product, and market position.

Some companies, such as General Motors, have already reported a direct hit: GM’s second-quarter earnings took a $1.1 billion loss as a result of tariffs, leading to a 32% decline in core profit. The automaker is responding with a mix of price increases, cost-cutting, and supply-chain adjustments, but warns that a continued tariff environment could further squeeze margins or eventually force higher prices onto buyers. Across the wider business community, company executives are now addressing tariffs in earnings calls.

Haefele said UBS will closely watch retail sales, inflation, and consumer spending data, while listening for comments in the ongoing second-quarter earnings season about who will truly be “eating the tariffs,” to paraphrase President Donald Trump.

Policy offsets and Fed dilemmas

Some fiscal offsets may be on the way. The recent “One Big Beautiful Bill,” which contains extended and new tax cuts—partly funded with tariff revenue—could help stimulate the economy. But the amount of that revenue is unclear.

Risks tilt in both directions. If tariffs fuel a larger-than-expected inflation surge, consumer spending may slow and the Federal Reserve could be forced into a tough policy corner, balancing price stability against economic growth. Alternatively, if companies absorb more costs to maintain market share, profits could slump, further weighing on investment and labor markets.

For now, the lagged nature of tariffs means their full effect is only beginning to show up beneath the surface of headline inflation. Economists and policymakers will be closely monitoring core inflation, retail sales, and corporate margins in the months ahead. The only certainty, it seems, is that tariffs are no longer an abstract policy debate: They are beginning to hit home—one price tag at a time.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

© UBS Global Wealth Management

President Donald Trump’s trade deals are illegal, Piper Sandler flatly declares in a new research note. The investment bank analyzed ongoing court battles and legislative authority, and concluded that Trump’s reliance on the International Emergency Economic Powers Act (IEEPA) to impose wide-ranging tariffs and cut bilateral deals far exceeds the powers granted by Congress.

It’s not a new opinion from Piper, necessarily—the bank laid out its reasoning in April, shortly after Trump’s “Liberation Day” announcement of universal tariffs under the IEEPA. Then, as now, it sees a 9–0 ruling in the Supreme Court against Trump as more likely than a Trump win.

The reason that the Piper Sandler team of Andy Laperriere, Don Schneider, and Melissa Turner is revisiting the subject is that oral arguments in these and similar cases are scheduled through September. The U.S. Court of Appeals for the Federal Circuit will hear oral arguments on whether Trump truly has unlimited authority under the IEEPA to impose tariffs on Thursday, July 31. Piper Sandler forecasts that appellate courts will issue rulings over the next several months.

“Trump will probably continue to lose in the lower courts, and we believe the Supreme Court is highly unlikely to rule in his favor,” the bank said. Here’s why.

Stiff resistance

Trump’s trade policy has encountered stiff resistance as lower courts push back against the administration’s sweeping claims of executive authority. On May 28, the U.S. Court of International Trade (CIT) ruled unanimously against Trump’s use of the IEEPA for tariffs, calling the administration’s arguments unconvincing. The decision is now under appeal.

In a separate May 29 ruling, D.C. District Judge Rudolph Contreras found that the IEEPA does not enable the president to impose tariffs at all and ordered an immediate reversal of certain duties—though that order is currently stayed pending appeal.

According to Piper Sandler, the heart of the matter is congressional intent. As it did in April, the firm argues that the IEEPA, enacted in 1977, was designed to give the president certain emergency economic powers, but not blanket authority to set tariffs. Courts have consistently rejected the idea that the statute includes such sweeping power.

Even recent bilateral deals, such as Trump’s agreement with Japan, do not cure the underlying legal flaw. Congress, not the president, holds the ultimate authority to impose tariffs and approve international trade agreements. Piper Sandler stresses, “Making a deal with another country has no bearing on the legality of Trump’s tariffs,” highlighting that executive-led deals absent congressional approval lack legal standing. “If Trump does not have the authority to impose tariffs he is claiming, it doesn’t matter whether he makes a deal with Japan or anyone else.”

Billions and bilateral deals at stake

If the Supreme Court rules against Trump, all trade deals and announced tariff changes made under the IEEPA—including minimum 10% import rates and threatened reciprocal tariffs—would be declared instantly illegal. Refunds could flow to companies and individuals who have paid unlawfully imposed tariffs, if they file claims with the CIT.

The massive, headline-grabbing $550 billion Japanese investment pledge is cited by Piper Sandler as an example of economic promises lacking clarity, specifics, or legal durability.

“Our trading partners and major multinationals know Trump’s tariffs are on shaky ground,” the Piper team writes. “It’s notable the promise of $550 billion in Japanese investments in the U.S. is accompanied by no details. It’s not clear where the money will be coming from, who will decide how it is allocated, and over what period the $550 billion will be spent.”

Despite all these reasons the tariffs are clearly illegal, Piper insists that the tariffs are likely to go up from this point and “remain at record levels for the next many months.” Here’s why.

Will tariffs go away soon?

Piper Sandler’s analysts caution that tariffs are likely to remain in place in the near term, supported by administrative stays and the slow judicial process. Even if reciprocal tariffs are struck down, Trump could pivot to other statutes, such as Section 232 (covering steel, aluminum, and cars), though these have even stricter legal guardrails and could invite further litigation. Trump is on “strong legal ground” in using Section 232 to impose tariffs on steel, aluminum, and cars, the bank says, but he may try to stretch that authority as he has done with other trade statutes. “The base case is there will be years of legal battles over tariffs.”

The research note details at least eight ongoing lawsuits from a diverse range of plaintiffs—including states, tribes, and small businesses—all challenging Trump’s use of the IEEPA. Court dockets now stretch across several federal circuits, signaling that “years of legal battles” may follow, even if Trump loses at the Supreme Court.

Piper Sandler emphasizes that major multinational corporations and foreign governments see U.S. trade policy as unstable. The result, the bank argues, is reluctance to invest heavily in the U.S. until the legal landscape becomes clearer—a situation that may persist for months, if not years, irrespective of any immediate court ruling.

Piper Sandler’s analysts express confidence that recent judicial skepticism of the executive branch’s unchecked statutory interpretations will carry over to the Supreme Court. The bank finds the conservatives on the court likely to vote just as they did in a series of recent cases, in which they “lined uniformly against the Executive Branch pulling out an old statute and asserting far-reaching, never-before-used authority nowhere found in the text of the statute.” The liberals are also not likely to grant unlimited authority to Trump.

Still, with Trump’s well-known litigious nature, and the legal calendar ahead, Piper concludes: “Instability surrounding trade is likely to last a lot longer.”

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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Red Lobster, the iconic seafood chain, is charting a new course under the leadership of CEO Damola Adamolekun after making its way out of bankruptcy. In an interview with Good Morning America on Thursday, the 36-year-old chief executive addressed two questions lingering on the minds of loyal guests and industry watchers alike: Will the beloved Endless Shrimp deal return, and how will looming U.S. tariffs on imported seafood impact diners? His answers signal a reset for the troubled restaurant brand, focused on financial stability, customer experience, and menu innovation.

Endless shrimp promotion: officially retired

For years, the Ultimate Endless Shrimp promotion was a staple at Red Lobster, drawing crowds with the promise of limitless seafood at a set price. But as the company navigated severe financial headwinds, it became clear the beloved deal was more curse than blessing. Adamolekun stated unequivocally, “We don’t have any plans to bring it back,” all but closing the door on an offer that, while popular, ultimately helped sink Red Lobster’s bottom line.

The all-you-can-eat shrimp program, initially launched as a limited-time offer, was made a permanent fixture in recent years. Far from boosting profits, the promotion instead triggered multimillion-dollar losses due to customers out-eating the chain’s margins. Bankruptcy filings revealed the deal alone was responsible for a loss of $11 million, accelerating Red Lobster’s financial unraveling in 2023 and 2024. “We listen intently to customer comments and try to react really quickly to deliver people what they want,” Adamolekun explained. “But you also have to make sure you’re running a profitable business.”

Red Lobster has shifted its strategy to focus on value in more sustainable forms: introducing appetizer deals, weekday happy hours, and a three-course “shrimp sensation” menu offered at select locations. While Adamolekun hasn’t completely ruled out creative promotions in the distant future, diners hoping for the Endless Shrimp’s return shouldn’t hold their breath.

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Red Lobster’s new menu items

Adamolekun has prioritized innovation and agility, though, including extensive outreach to customers via social media, and a notable responsiveness from the chain to their feedback. Since emerging from bankruptcy, the company has overhauled its menu—streamlining offerings by 20% while adding new items like Lobster Pappardelle Pasta, Bacon-Wrapped Sea Scallops, and revitalizing favorites including hush puppies and popcorn shrimp. Within days of receiving requests for bolder flavors, Red Lobster added new spicy, Old Bay Parmesan, and Cajun sausage options to the menu. “We want to be exciting, relevant and compelling for our guests,” Adamolekun said.

Red Lobster addresses new tariffs

This summer’s scheduled U.S. tariffs on imported seafood have sparked concern that seafood lovers could soon see restaurant bills soar. Adamolekun was quick to calm those fears in his GMA interview, stressing that almost 90% of Red Lobster’s key seafood—lobster and crab—comes from North America and Canada. These sources are largely exempt from new tariffs under agreements like USMCA.

While some shrimp and other products are still imported and thus subject to tariffs, Adamolekun underscored, “We do import products as well — so on those products we’ll pay a tariff like everybody else. That impacts our business, and our intention is not to pass that through. We’re not intending to do any more price increases for the rest of the year, regardless of what happens with tariffs”.

Adamolekun’s leadership approach

Red Lobster’s turnaround has not gone unnoticed, with improved customer feedback and returning foot traffic since the restructuring. The company’s multiyear plan includes further renovations of its restaurants to create a more vibrant, inviting atmosphere—an appeal especially aimed at younger diners looking for experience as much as a meal.

After turbulent years, Adamolekun’s approach reflects both hard business lessons and a renewed commitment to guest satisfaction. The days of bottomless shrimp may be over, but under new leadership, the seafood chain is betting that menu innovation, value deals, and responsive service can once again make Red Lobster a place to celebrate.

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Red Lobster CEO Damola Adamolekun previously served as the chief executive of P.F. Chang’s. In a 2023 interview with Fortune, Adamolekun described his daily routine. #redlobster #PFchangs #ceo #dayinthelife #dailyroutine #routine #wlb #worklife #worklifebalance #success #fortune #food #fitness #runner #running

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Microsoft, one of the world’s most valuable tech companies, is undergoing a sweeping internal transformation punctuated by mass layoffs, even as its financial performance soars and its ambitions in artificial intelligence reach unprecedented heights. In a memo sent to employees on July 24, CEO Satya Nadella outlined the paradox at the heart of Microsoft’s current moment: ongoing job cuts amid record profits, bold AI investment, and a corporate culture in flux.

The scope of Microsoft’s 2025 layoffs is considerable. More than 15,000 positions—about 7% of the company’s global workforce—have been eliminated since January, making this the company’s largest personnel reduction since the 2014 cuts following the Nokia acquisition. The latest and most significant wave came in July, when roughly 9,000 employees, or 4% of staff, were informed their roles were being eliminated. These latest reductions followed prior rounds in May and June, which saw thousands more let go as the company aggressively reshaped itself for the AI era.

The memo: Confronting the ‘enigma of success’

In his July memo, Nadella directly addressed the seeming contradiction at the heart of the layoffs. “By every objective measure, Microsoft is thriving—our market performance, strategic positioning, and growth all point up and to the right,” he wrote, noting the company’s capital expenditures, largely fueled by investments in AI and cloud infrastructure, are at historic highs. Despite these investments, he said headcount “is relatively unchanged,” given the simultaneous reduction of jobs.

Nadella called this tension the “enigma of success in an industry that has no franchise value,” arguing that success in tech is not permanent or evenly distributed. “Progress isn’t linear. It’s dynamic, sometimes dissonant, and always demanding. But it’s also a new opportunity for us to shape, lead through, and have greater impact than ever before.”

Expressing gratitude to those let go, Nadella acknowledged the human cost. “Their contributions have shaped who we are as a company, helping build the foundation we stand on today. And for that, I am deeply grateful.”

Resetting Microsoft’s mission

Nadella rooted Microsoft’s new direction in three core business priorities: security, quality, and AI transformation. He said in the era of AI, Microsoft’s mission must move from building static tools to empowering every person and organization to build their own. Nadella described a vision where “all 8 billion people could summon a researcher, an analyst, or a coding agent at their fingertips.” The company, he said, is pivoting from a “software factory” to an “intelligence engine”—an acknowledgment that AI is now the lens through which Microsoft will view every product, service, and business unit.

This transition comes with heavy investment: Microsoft is pouring $80 billion into AI infrastructure this fiscal year, redeploying capital and, crucially, shifting a portion of the workforce to make room for these new bets.

Nadella issued a call to action to stem anxieties around job security and morale, urging employees to maintain a “growth mindset” and approach the messiness of transformation with humility and resolve. “It might feel messy at times, but transformation always is. Teams are reorganizing. Scopes are expanding. New opportunities are everywhere,” he wrote, describing the current focus on AI as similar to the 1990s tech revolution in PCs and productivity software.

Microsoft’s sweeping job cuts echo a wider trend among tech giants in 2025, as companies recalibrate for a post-pandemic market increasingly defined by AI-driven automation. By one count, more than 80,000 jobs have been slashed in the tech industry this year. Nadella’s memo did not rule out further layoffs and also did not promise stability, seeking to unify staff around the mission to “empower others to build now.”

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

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Hedge fund billionaire Ray Dalio is known for his dire warnings about the economy and the national debt, but he just issued one of his starkest warnings to date, likening the United States’ mounting debt crisis to an impending “economic heart attack” and urging policymakers to revisit the fiscal discipline that characterized the 1990s boom years. Dalio’s alarm, sounded in a series of social media posts and interviews, including with Fortune’s Diane Brady, comes as the national debt nears $37 trillion and the federal deficit continues to swell, fueling bipartisan anxieties about the country’s financial health.

Dalio, founder of the world’s largest hedge fund, Bridgewater Associates, described America’s deficit spiral in dramatic—and visceral—terms. “We’re spending 40% more than we’re taking in, and this is a chronic problem,” he said in a recent appearance on Fox Business. “What you’re seeing is the debt service payments … well into squeezing away, so it’s like plaque in the arteries squeezing away buying power.”

The analogy underscores a grim reality: Debt service payments have ballooned as a share of government spending, increasingly crowding out funds for other priorities. Dalio warns the U.S. is near a tipping point where it must issue new debt merely to pay interest on existing obligations—a cycle that he says could trigger not just a financial shock but a systemic breakdown reminiscent of cardiac arrest. We’ve got to go back, he argues—back to the ’90s.

A blueprint for recovery

Dalio contends that there is still a way out—as long as the country acts with unity and resolve. He points to the ’90s as a model for bipartisan problem-solving, fiscal restraint, and balanced economic growth. “If we change spending and income (tax returns) by 4% while the economy is still good,” he wrote on Twitter, “the interest rate will go down as a result, and we’ll be in a much better situation.” He added that we know this kind of balance can happen because it happened before, from 1991 to 1998, referencing how both spending controls and targeted tax measures restored equilibrium in the 1990s.

Dalio suggests that by trimming the federal deficit to 3% of GDP—levels last sustained during the Clinton era—the U.S. could stabilize markets, tame interest payments, and avoid a crisis. In a CNBC appearance in early July, Dalio put the odds at over 50% that a financial “trauma” will result from the debt not being dealt with properly.

Past warnings

This is far from the first dire warning to come from Dalio on the state of the U.S. economy. In the past five years, he has voiced concerns about the debt created to fight the financial effects of the pandemic, both inflation and stagflation, and even a looming recession. Although a recession has not set in since the COVID-related crash of 2020, Dalio warned that rising asset prices weren’t creating real wealth, as inflation was eroding purchasing power.

A consistent theme of Dalio’s warnings is that the disease may be worse than the cure, criticizing policymakers likely to act only when inflation became critical and the dollar’s value had materially eroded. He has voiced variations of his “heart attack” and “plaque” critique since 2024.

Despite offering a clear prescription, Dalio expresses skepticism that current political dynamics will allow for compromise or the hard choices required. “My fear is that we will probably not make these needed cuts due to political reasons,” he wrote on Twitter, warning that absolutism in Washington could doom efforts to put the country’s fiscal house in order.

The consequences, Dalio argues, would be severe and far-reaching: sustained government overspending, rising debt service burdens, and a loss of confidence among buyers of U.S. Treasuries. This scenario, he says, could escalate into what he calls a “serious supply-demand problem,” where the market refuses to fund America’s borrowing habits at sustainable rates, catalyzing a financial crisis with global shock waves. The April fall in the 10-year Treasury bond market was a tremor of just such a refusal from foreign investors, who seemed to balk at President Donald Trump’s planned tariffs being much more aggressive than expected.

Dalio’s repeated invocations of the 1990s are more than nostalgia—they are a call to bipartisan pragmatism and shared sacrifice. He warns that failure to act now, with the economy still on stable footing, will only raise the costs (and pain) of inevitable reforms. Although Dalio did not comment on it, the debt situation has actually worsened throughout 2025, with legislation passing through Congress that is set to expand the debt for years to come. Trump’s One Big Beautiful Bill Act will add $3.4 trillion to deficits over the next decade, according to the Congressional Budget Office.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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Terry Bollea, better known to the world as professional wrestling icon Hulk Hogan, died Thursday at his home in Clearwater, Florida, at the age of 71, TMZ reported, a development that was soon confirmed by WWE. The cause of death was reported as cardiac arrest, with emergency services responding early in the morning after a call from his residence. Hogan is survived by his wife, Sky Daily, and two children, Brooke and Nick, from prior marriages.

Although he was one of professional wrestling’s iconic figures, Hogan may be remembered more for the chill he sent through journalism with an eventful lawsuit in the 2010s backed by Silicon Valley billionaire Peter Thiel.

Hogan’s passing closes the chapter on a larger-than-life figure whose impact on the industry and popular culture spanned more than four decades. After making his wrestling debut in 1979, Hogan quickly rose through regional territories before ascending to major wrestling stardom in the mid-1980s. His charisma and signature catchphrases—most notably, “Whatcha gonna do, brother, when Hulkamania runs wild on you?”—made him professional wrestling’s first true global superstar, and a notable crossover star into mainstream entertainment.

With his iconic red-and-yellow ring gear, his habit of shredding his shirt, and his trademark entrance to the song “Real American,” Hulk Hogan became synonymous with WWE’s transformation from a niche pastime into a billion-dollar entertainment juggernaut. He headlined the very first WrestleMania in 1985, helping WWE’s then-chairman Vince McMahon realize his vision of a nationwide phenomenon.

Throughout the late 1980s and early 1990s, Hogan was the face of the WWE, when he captured a run of world championships and led storylines in era-defining fashion. His character inspired generations of children—“Hulkamaniacs”—but his appeal reached far beyond wrestling. Hogan became a fixture of pop culture, making appearances in movies including Rocky III, Suburban Commando, Mr. Nanny, and TV shows such as Thunder in Paradise. After several years in Hollywood, Hogan returned to wrestling in the late 1990s, reinventing himself as a “heel,” named Hollywood Hogan, in WCW’s New World Order.

He was a two-time WWE Hall of Famer, first inducted individually in 2005 and then as a member of the nWo faction in 2020.

Despite the superhero persona, Hogan’s life was not without controversy and hardship. He endured high-profile personal and legal battles and shifts in public perception. He also played a major role in a lawsuit that changed digital journalism and signaled a new era in right-wing politics.

in 2012, Gawker Media published a brief excerpt from a sex tape featuring Hogan and Heather Clem, the wife of Hogan’s friend, a Floridian radio host with the stage name Bubba the Love Sponge. The video had been filmed secretly and then leaked to Gawker by an anonymous source. Hogan, shocked and outraged by the publication, filed a lawsuit charging Gawker with invasion of privacy, infringement of personality rights, and intentional infliction of emotional distress.

The trial took place in Florida in early 2016 and drew widespread attention to the rising tensions between individual privacy rights and freedom of the press in America. After only a few hours of deliberation, the jury ruled in Hogan’s favor, awarding him $115 million in compensatory damages and an additional $25 million in punitive damages, for a total of $140 million. A month after the verdict, Gawker founder Nick Denton told Fortune that he wished he’d “known how litigious Hulk Hogan was.”

The colossal judgment forced Gawker Media to file for Chapter 11 bankruptcy, even though the parties settled for $31 million. The aftermath included an unprecedented revelation: The lawsuit was financially backed by Peter Thiel, who had personal grievances against Gawker after being outed by the site in a previous article. Up to that point, Thiel was best known as a member of what Fortune dubbed the “PayPal Mafia,” but the Gawker lawsuit was part of his emergence as one of the faces of Silicon Valley’s rightward turn. Both Hogan and Thiel had supported Donald Trump in the recent 2016 presidential election.

Gawker’s bankruptcy marked the end of a prominent, controversial digital outlet known for unfiltered reporting, and Hulk Hogan v. Gawker Media remains one of the most consequential legal battles in recent American media history, fundamentally reshaping ideas around privacy, journalism, and power.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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• AI’s rapid progress is a double-edged sword, the nature of work is being irreversibly changed, ethical alignment is urgent and unresolved, and the cultural response is divided but vital, Sam Altman told popular podcaster Theo Von. Their interview felt like staring into the void, at times, with human purpose in danger of being wiped out by the rapid advance of technology. Altman agreed with almost all the doubts that Von raised, but offered a hopeful vision. Still, he said, children’s and everyone’s digital well-being will require attention going forward.

Sam Altman, CEO of OpenAI and one of the most influential voices in artificial intelligence, sat down with comedian Theo Von for an expansive, in-depth conversation on a new episode of Von’s tremendously popular podcast, This Past Weekend. Their hour-and-a-half dialogue, recorded at OpenAI’s headquarters in San Francisco, traversed the urgent race to develop more powerful AI, the destabilizing impact of automation on the workforce, the hopes and fears animating Silicon Valley, and Altman’s personal anxieties about the tech shaping our world.

From the jump, Von pressed Altman on the breakneck pace of AI development. “Do you think there should be kind of like a slowing things down?” Von asked, adding, “That’s one of the reasons I get scared sometimes to use certain AI stuff, because I don’t know how much personal information I want to put in, because I don’t know who’s going to have it.”

Altman compared the current climate among leading AI companies to an intense “race”—not just for commercial dominance, but because the values guiding today’s development will echo for generations. He said if OpenAI does not move quickly, someone else will, and the fate of AI could slip out of the hands of those most mindful about its social consequences.

Altman acknowledged how uncertain the future feels, both for those building these systems and for the broader society swept up in their wake. “I think all of human history suggests we find a way to put ourselves at the center of the story and feel really good about it … Even in a world where AI is doing all of this stuff that humans used to do, we are going to find a way in our own telling of the story to feel like the main characters.”

Neither Altman nor Von addressed the fact that AI might relegate humans to supporting characters, as many thought leaders warn of AI’s ability to endanger human life. Still, Altman said he thinks humans will continue to be the main characters going forward, “in an important sense.”

The reinvention of work and value

Von also asked whether people should be worried their jobs could be rendered obsolete by AI. “How will people survive?” he asked.

Altman argued AI will create possibilities for individuals to pursue more creative, philosophical, or interpersonal goals, but Von pushed back: “One of the big fears is like purpose, right? Like human purpose. Like work gives us purpose … If AI is to really continue to advance so quickly, it feels like our sense of purpose would start to really disappear.”

Altman said when everyone has the kind of access to instant expertise that AI enables, humans can remake the idea of what it means to contribute to society, though he cautioned the transition will be deeply unsettling for those whose livelihoods are displaced in the near term.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

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In a stark and urgent warning to the nation’s financial stewards, OpenAI CEO Sam Altman declared on Tuesday that artificial intelligence is now so adept at mimicking human voices it could spark a global “fraud crisis” in banking “very, very soon.” His remarks, delivered at a Federal Reserve conference in Washington, underscored how people will have to change fundamental things about the way they interact because of the relentless pace of advancements in this technology.

Altman addressed hundreds of regulators and banking executives while sitting down for an interview with Fed governor Michelle Bowman, the vice chair for supervision. Bowman, who has emerged as a contender to potentially succeed Fed chair Jerome Powell, prompted Altman to talk about the technology he helped pioneer and concerns about fraud.

Altman immediately brought up how powerful AI models are now capable of perfectly reproducing anyone’s voice based on just a few short audio samples and issued his warning: “A thing that terrifies me is apparently there are still some financial institutions that will accept the voiceprint as authentication for you to move a lot of money or do something else,” Altman told the audience. “That is a crazy thing to still be doing … AI has fully defeated that.”

The widespread adoption of voice authentication

To Altman’s point, banks have, for more than a decade, relied on voice authentication: Clients repeat a custom phrase, their “voiceprint,” to access accounts. But as generative AI has advanced, so have the tools available to would-be fraudsters. Altman described a near future where attackers will be able to call a bank, pass every test, and move money freely, all by simulating a customer’s voice.

“Just because we are not releasing the technology does not mean it does not exist,” Altman said of the pandora’s box that AI represents. “Some bad actor is going to release it—this is not a super difficult thing to do.”

The OpenAI chief described the scenario that keeps him up at night: a large-scale, coordinated attack where AI-generated voices rapidly defeat outdated security measures across the world’s biggest banks.

The threat isn’t limited to voice. Altman gave a glimpse into the next frontier: “video clones”—AI capable of mimicking an individual’s appearance and speech—heightening the stakes for personal security and institutional trust.

“Right now it is a voice call. Soon it is going to be a video FaceTime. It will be indistinguishable from reality,” he said.

A potential partner in Washington

Altman’s warning didn’t fall on deaf ears. Bowman agreed that collaboration between regulators and tech leaders going forward will be vital. “That might be something we can think about partnering on,” she said, signaling the central bank’s readiness to take action and eagerness to work with OpenAI.

OpenAI, for its part, is planning to expand its physical presence in Washington, D.C., aiming to facilitate more direct collaboration with regulators and policymakers, including the Federal Reserve. The company’s new D.C. office will host policy workshops and serve as a venue for hands-on collaboration and training related to AI deployments in government and regulated industries, a spokesperson for OpenAI told CNBC the day before Altman’s panel with Bowman.

The Fed frequently organizes similar roundtable discussions and panels with executives from tech, fintech, and financial institutions to explore the adoption and impact of AI, especially generative AI, in banking and broader economic sectors. The central bank also encourages partnerships between banks and fintechs, with the latter working to integrate advanced AI tools into regulated banking activity.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

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Tesla’s second quarter earnings signaled the company continues to go through a difficult patch, with both revenue and adjusted earnings per share missing the average Wall Street estimates. Revenue was $22.5 billion, down approximately 12% year over year, the sharpest decline in at least a decade. Adjusted earnings per share was 40 cents, down from 52 cents a year ago. Analysts, on average, had forecast revenue between $22.62 billion and $22.64 billion and adjusted EPS of $0.41 to $0.42 per share, with Tesla below the midpoint on each.

Tesla’s double-digit percentage revenue decline was primarily attributed to the ongoing slump in vehicle deliveries. Improved energy storage deployments and new service offerings provided minor offsets, but could not outweigh the hit from lagging car sales and persistent price competition across the electric vehicle industry.

Operating income also fell significantly, coming in at $923 million, which was below consensus estimates of $1.23 billion. Net income dropped year over year as margins continued to shrink, pressured by lower average selling prices, higher raw material costs, and global trade headwinds.

Tesla had previously reported deliveries of more than 384,000 vehicles in the quarter—a drop of more than 13% from the previous year—with production holding steady at just over 410,000 vehicles. This marks the second quarter in a row of reduced year-over-year deliveries.

Wall Street had entered the earnings week with tepid expectations, citing declining sales, compressed margins, and elevated spending on research and development as factors dampening short-term prospects. While Tesla’s results were slightly weaker than forecast, shares saw only a modest uptick in after-hours trading, as investors focused on the company’s long-term ambitions rather than current sales struggles.

Robotaxi, AI, and a new affordable model

Tesla’s leadership used the earnings release to reaffirm its pivot toward next-generation technologies. CEO Elon Musk highlighted the launch of Tesla’s first Robotaxi pilot service in Austin, along with vague remarks related to the ongoing development of a long-rumored “more affordable” Tesla model.

Musk signaled that, amid stiffer automotive competition, Tesla’s strategy increasingly centers on breakthroughs in autonomy, artificial intelligence, and energy solutions as pillars for future growth.

Multiple challenges continue to weigh on Tesla, including expiring U.S. electric vehicle tax credits in October 2025, ongoing trade disputes and tariffs affecting costs and global supply, and intensifying competition from established automakers and Chinese EV brands. More generally, the brand has growing reputational issues associated with Musk and his support of President Donald Trump, even after the two had a falling out that coincided with fierce criticism of each upon the other. During Musk’s brief role helping the administration, his sometimes successful attempts at slashing government spending provoked ire from much of Tesla’s traditional customer base, with environmentalist and left-leaning politics. Other investors said they wished the distraction would go away.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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Millennials have officially overtaken Generation X as the largest cohort of managers in the American workforce in 2025. This generational handoff marks more than a demographic curiosity—it’s potentially a major shift in how organizations are led, as millennials have a different management style than their predecessors.

According to the semiannual Worklife Trends report by Glassdoor, millennials became the largest share of the managerial workforce in late June 2025, overtaking Gen Xers, who dominated leadership during the past two decades. At current aging trends, according to projections from Glassdoor lead economist Daniel Zhao, Gen Z will provide a greater share of managers than baby boomers in late 2025 or 2026. Already, Gen Z makes up one in 10 managers.

Glassdoor

Since becoming the most populous generation in the labor force in the mid-2010s, millennials have steadily risen through the ranks, propelled by demographic inevitability, retirements among baby boomers, and new attitudes toward organizational leadership. This ascent caps years of warnings and speculation about how millennial values would shape the workplace.

In an interview with Fortune, Zhao said millennials are inheriting a tough situation, but it could be worse. Workers by and large “don’t feel like they’re in a great situation” right now, but Zhao noted things have not deteriorated for workers since the last edition of the report in January 2025.

Although Zhao didn’t use this particular Gen Z slang, the state of the workforce that is now majority managed by millennials is mid. “At the very least it doesn’t seem that workers are feeling worse,” Zhao said. “I don’t know if you can call that a silver lining.”

Millennials managing through the ongoing ‘burnout crisis’

Millennials are widely credited with pushing “empathy” and “well-being” to the forefront of management culture. They prioritize policies such as remote work, mental-health benefits, and boundary-setting—yet there’s a reason millennials stress mental health so much: They are experiencing record levels of burnout, stress, and job insecurity themselves, leading some workplace experts to warn of a looming “manager crash” in 2025. Zhao agreed this lines up with anecdotes in Glassdoor reviews, but not the data in his research.

Zhao, for his part, writes that the mental-health challenges facing the current workforce show “no signs of abating.” He writes of burnout as an “ongoing crisis,” with mentions in Glassdoor reviews spiking 73% year over year as of May 2025. “Reviews about burnout often refer to the cumulative effect of several years of layoffs and understaffing wearing on employees who remain.”

Of course, the term “burnout” became largely synonymous with the millennial generation in Anne Helen Petersen’s viral 2019 Buzzfeed article on the subject, which morphed into a book and a deep vein of reporting for years to come. Speaking to Petersen’s thesis, that millennials were born into a culture and climate of constant work from a young age, the average number of direct reports per manager has almost doubled in recent years, piling burnout levels of stress onto the burnout generation, just as they become the majority of managers.

Zhao declined to comment on Petersen’s thesis directly, but on the subject of burnout more generally noted that many millennial managers, especially those in their forties and late thirties, are aging into the “sandwich generation,” with responsibilities that have been typical for Gen X: “Millennials right now are in a place where their career pressures might be highest, but there are also these other personal pressures that are really stressing millennials out.” Zhao added that “in a sense, they’re stuck between a rock and a hard place.”

Despite their ambitions, many millennial managers report receiving little to no formal leadership training, often feeling unprepared for the complexities of managing teams across multiple generations and responding to rapid organizational change. This is bound to worsen with double the reports of the historical average. And while they stress empathy, millennials are the generation that invented the term “ghosting” for their avoidant behaviors on social media, and many struggle with assertiveness and managing workplace conflict head-on. Finally, millennials are the “participation trophy” generation, and some bruising TikTok videos have argued that millennial bosses have a toxic tendency to try to befriend all their direct reports. “Wolves in sheep’s clothing,” they were called. Ouch.

The flip side of emotional intelligence

Zhao told Fortune that the well-worn cliché about millennial managers being known for their focus on empathy has a flip side. Glassdoor has seen a change in how people talk about management over the past five years since the pandemic, he said: “Reviews that discuss management increasingly emphasize terms related to emotional intelligence, like ‘respecting boundaries,’ ‘being empathetic,’ ‘promoting employee well-being,’ and ‘addressing burnout.’” Zhao noted it shows that workers’ expectations have increased: “The bar on what constitutes a good manager has been raised.”

It doesn’t mean millennials are inherently gifted at emotional intelligence, Zhao said, just that it’s an expectation of their reports, be they fellow millennials, Gen Z, or perhaps even Gen X or boomers. Zhao referenced research that the phrase “emotional intelligence” really started picking up in the 21st century. How ironic, then, that the population that mainstreamed emotional intelligence when they entered the workforce is now responsible for managing it.

Although millennials generally seek to build trust and provide recognition, generational divides persist: A notable minority of employees, especially Gen Z, remain neutral or uncertain about the recognition they receive. According to a comprehensive Deloitte survey, millennials themselves want more feedback, mentorship, and growth opportunities, both for their teams and for their own careers.

This may be why millennials are getting saddled with a dreaded moniker: the so-called cool boss. Recent reporting and viral social-media content have fueled criticism of millennial managers for blurring the line between manager and friend—sometimes to detrimental effect. Sketches and first-person accounts highlight a stereotype of the millennial manager who is eager to be seen as hip, adopting a laid-back attitude, casual communication, and a friendly rapport with direct reports. Critics argue this style can be toxic in creating a “false sense of warmth” that masks underlying power dynamics. In terms of achieving results, the cool boss act leads to inconsistent or unclear expectations, fueling anxiety among staff. And when negative feedback is necessary, the cool boss dropping the mask can come as a shock to their subordinates.

Many millennial managers report difficulties in setting clear boundaries with their teams as they struggle to code-switch from friendly to authoritative as situations demand. Setting boundaries is further complicated by generational shifts: Younger employees, particularly Gen Z, also favor fluid boundaries and a flat hierarchy, sometimes intensifying the ambiguity around roles and expectations.

While Zhao did not comment directly on the so-called cool boss meme, he said millennial managers are walking an “extremely tough line right now.” Millennials are supposed to be at the peak of their career, but many are also taking care of kids, parents, even elder family members. “On the care aspect,” Zhao said, “there’s been a lot of discussion, especially since the pandemic, on the gaps … in the American economy today.”

Are you a millennial who’s a manager, or do you have a millennial for a manager? Fortune would love to hear from you: get in touch at [email protected].

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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Shares of ASML, the Dutch semiconductor equipment giant, tumbled 11% on Wednesday after the company announced it could no longer confirm that it will grow in 2026. The drop wiped out over $30 billion in market value and sent shockwaves through global tech markets, as investors digested the implications for the broader semiconductor and AI industries.

The selloff followed ASML’s second-quarter earnings report, which beat expectations on revenue and net profit, with robust bookings of $6.4 billion. However, CEO Christophe Fouquet’s comments overshadowed the strong results: “While we still prepare for growth in 2026, we cannot confirm it at this stage,” he said, citing escalating macroeconomic and geopolitical uncertainty, especially the threat of new tariffs on semiconductor equipment.

Smart money watches ASML for signals on the tech cycle’s health; a growth warning here may be the market’s early clue that the AI and semiconductor supercycle is reaching a plateau—or at least preparing for turbulence.

Why ASML’s outlook matters more than most

This isn’t just a company-specific event—it could be a canary in the coal mine for the global tech and AI ecosystem. Why? ASML is the world’s exclusive supplier of EUV lithography machines—the ultra-precise fabrication equipment that makes cutting-edge semiconductors possible. Every state-of-the-art AI accelerator, every data-center chip that powers generative AI, traces its technological lineage back to ASML’s tools.

So when ASML tells the market it “cannot confirm” growth for 2026—despite beating on current earnings—it’s signaling not just caution about its own pipeline, but a potential inflection point in the most future-critical segment of the electronics supply chain. In other words: if ASML’s order book slows, it means that downstream chipmakers may anticipate softer demand, have rising uncertainty about capex returns, or are bracing for policy headwinds.

The context matters: This is a moment when AI demand has been surging, but in 2025 it’s now colliding with macro uncertainty, particularly driven by U.S.-EU tariff threats, China export restrictions, and capex fatigue after a historic tech investment wave. ASML’s lead times are 12 to 18 months—with orders today reflecting confidence in global chip demand well into 2026. If that confidence is wavering, it ripples through the entire innovation economy.

ASML is not just another tech stock—it is the linchpin of the global semiconductor supply chain. The company is the world’s sole supplier of extreme ultraviolet (EUV) lithography machines, the critical technology that enables the production of the most advanced chips used in everything from AI accelerators to smartphones and data centers.

What’s behind the growth warning?

Several factors converged to cloud ASML’s outlook. One was tariff uncertainty. President Trump’s threat of 30% tariffs on European imports, including semiconductor equipment, has rattled ASML’s customers. The company warned that tariffs on new systems and parts shipped to the U.S., as well as possible retaliatory measures, could directly hit its gross margins and delay customer investment decisions.

Ongoing trade disputes and export controls, especially involving China and the U.S., have made it harder for ASML to forecast demand. Clients are increasingly cautious, with some potentially postponing or scaling back orders. While Q2 bookings were strong, Barclays analysts noted ASML would need to double its current order pace to meet previous 2026 growth forecasts. The backlog coverage for 2026 is at its lowest in three years, raising doubts about near-term momentum.

Market reaction

The market’s response was swift and severe as ASML shares fell 11%, their steepest single-day drop since October 2024, when a disappointing third-quarter earnings report led to the stock price falling 16%. Wednesday’s selloff dragged down the broader European tech sector and hit U.S. semiconductor equipment peers such as Lam Research and Applied Materials.

In contrast, AI chipmakers such as Nvidia and AMD rose, buoyed by positive news on U.S. export policy to China, highlighting a divergence between chip designers and the equipment supply chain.

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Treasury Secretary Scott Bessent sharply escalated his criticisms of the Federal Reserve on Monday, publicly urging a comprehensive investigation into the central bank’s operations and effectiveness. In a news-making interview with CNBC, Bessent questioned whether the Federal Reserve has fulfilled its mandate, issuing a rare public critique from the nation’s top economic official on its own central bank at a pivotal moment for U.S. economic policy. His remarks came amid a summer storm of criticism from the Trump administration against the Fed.

Speaking from Washington, Bessent likened the proposed investigation to safety reviews in other major agencies, such as the Federal Aviation Administration. “What we need to do is examine the entire Federal Reserve institution and whether they have been successful,” Bessent told CNBC’s “Squawk Box.” “Has the organization succeeded in its mission? If this were the [Federal Aviation Administration] and we were having this many mistakes, we would go back and look at why has this happened.”

Bessent also accused the Federal Reserve of “fear-mongering” over President Trump’s sharp tariffs on imported goods, noting: “There was fearmongering over tariffs, and thus far, we have seen very little, if any, inflation. We’ve had great inflation numbers,” he said, referencing the latest data showing annual inflation measured at 2.7% in June, although inflation did creep slightly higher than expected in June, to its highest level since February. Still, inflation has widely not materialized as much as economists and the Fed have warned, and economists have been working to solve the $100 billion mystery. Morgan Stanley has described the tariffs as a developing “mosaic” with “idiosyncratic” effects on the economy, poised to generate $2.7 trillion over the next decade.

He lamented what he sees as an intellectual rigidity at the central bank, criticizing how they are unable to “break out of a certain mindset,” adding, “all these PhDs over there—I don’t know what they do,” Bessent remarked, expressing frustration at the economists steering the institution’s decisions.

The pressure campaign

Bessent’s demand for an inquiry comes amid growing discord between the Trump administration and Fed Chair Jerome Powell, with many Trump officials openly criticizing Powell after Trump began posting on social media at his frustration over Powell’s refusal to cut interest rates as he has consistently cited the risk of inflation running out of control if he does so. The President has pressed the central bank to lower interest rates, arguing that hesitancy has cost the economy “hundreds of billions of dollars.” Jeffrey Roach, chief economist at LPL Financial, told Fortune that cutting rates down to 1%, as Trump says he wants, would be a “ludicrous” outcome.

While Trump recently tamped down speculation about removing Powell, Bessent declined to comment on whether he had directly advised against the move, emphasizing instead the need to investigate the broader institution, not just its leadership. Earlier in July, Bessent was the first Trump official to confirm that a formal process was under way by the Trump White House to select Powell’s successor.

In recent weeks, officials including National Economic Director Kevin Hassett and Federal Housing Finance Authority chair Bill Pulte have criticized Powell over the Fed’s $2.5 billion renovation of its headquarters in Washington DC. Powell pushed back against these criticisms just days before Bessent’s Monday comments. Over the weeked, the Associated Press reported that the White House and Fed clashed over whether the renovation should incorporate more glass or the more expensive marble, with marble being the Trump administration’s choice, per meeting minutes. Adding to the turmoil, Republican lawmakers in Congress made a criminal referral against Powell earlier on Monday, alleging false statements to Congress about the renovation work. For his part, Powell has asked the central bank’s inspector general to review aspects of the project for transparency.

Markets and Independence

The central bank’s independence is a cornerstone of U.S. economic credibility with global markets. Some White House officials, as well as market participants, fear that escalating attacks could undermine institutional trust. Senate Majority Leader John Thune notably affirmed the market’s seeming desire and support for an independent Federal Reserve and JPMorgan Chase CEO Jamie Dimon rebutted Bessent’s remarks about a formal process to replace Powell, saying central bank independence is “absolutely critical.” The risk of losing Fed independence is widely understood to be synonymous with the U.S. economy’s wider loss of credibility, but Deutsche Bank has spelled out a scenario where, if Trump were to remove Powell before the end of his term, both the dollar and bond market could collapse.

Despite political friction, Bessent reiterated that President Trump alone will ultimately decide the future of Fed leadership. The market is responding in much the way Thune described, with stocks hitting record highs in July amid a better-than-expected jobs report and increases in both retail sales and consumer sentiment. Those combine to lead to the very thing Trump wants to end: unchanged interest rates.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

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Coca-Cola will soon return to using real cane sugar in its U.S. products after decades of relying on high fructose corn syrup, according to none other than President Donald Trump, who claimed personal credit for brokering the shift.

In a social media post, the president called the move “just better” for American consumers, and also predicted “this will be a very good move by them,” referring to the Atlanta-based beverage giant.Trump revealed on social media that Coca-Cola has “agreed to use REAL Cane Sugar in Coke in the United States” after discussions between himself and company leadership. 

In a statement, a Coca-Cola company spokesperson said: “We appreciate President Trump’s enthusiasm for our iconic Coca‑Cola brand. More details on new innovative offerings within our Coca‑Cola product range will be shared soon.”

The change is significant—since the mid-1980s, virtually all Coca-Cola sold in the U.S. has been sweetened not with sugar, but with high fructose corn syrup, a less expensive alternative, but a very politically potent one.

The commercial production of high fructose corn syrup takes place in Iowa, the top corn-producing state in the U.S. It’s been a major product for agribusiness since the 1970s, with companies such as Archer Daniels Midland having key plants in Iowa. They are a big player in Washington, D.C., as is the “farm lobby,” which refers to a number of institutions that lobby on behalf of farmers’ interests. U.S. farm policy—shaped by the farm lobby—subsidizes corn heavily and imposes tariffs and quotas on imported sugar, making high fructose corn syrup the default sweetener for many U.S. food producers. All of these dynamics are reinforced by Iowa’s role in presidential politics, with the state being the first presidential caucus in the electoral calendar.

When did Coke switch to corn syrup?

Coca-Cola’s original formula, dating back to its 19th-century origins, used cane sugar as the sweetener of choice. That changed during a period of economic and regulatory upheaval in the late 1970s and early 1980s.

Faced with rising sugar prices, prompted in part by U.S. government quotas and tariffs on imported sugar alongside growing subsidies for domestic corn, Coca-Cola began blending corn syrup with sugar in its beverages. The transition was complete by 1984. Even after the “New Coke” formula controversy and the return of “Coca-Cola Classic,” the drink retained high fructose corn syrup as its sweetener, not sugar.

The cult of “Mexican Coke”

Coca-Cola in other countries—most famously in Mexico and across Europe—has continued to use cane sugar, spawning a cult following for “Mexican Coke” among U.S. consumers who preferred the original taste.

American soda fans have long claimed to notice a difference in beverages sweetened with cane sugar. Imports of “Mexican Coke,” made with real sugar, became a popular niche item, prompting limited edition “throwback” sodas using cane sugar to appear periodically.

It remains unclear how quickly Coca-Cola will phase in cane sugar nationwide, and it likewise remains unclear how this move fits within Trump’s broader use of tariffs, including the tariffs predating his tenure that make sugar imports more expensive than subsidized corn. But it’s a major change beyond just a beverage giant’s soda recipe.

Coca-Cola did not immediately respond to a request for comment. Fortune has also sent requests for comment to the American Farm Bureau Federation and the Iowa Corn Promotion Board.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing. 

This story was originally featured on Fortune.com

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