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Affirm faces BNPL headwinds, Microsoft launches new laptop, United Airlines expands pilot training

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Yahoo Finance Live looks at several of the day's leading industry stories, such as Affirm's outlook in the buy now, pay later landscape and how United Airlines is responding to labor shortages.

Video Transcript

SEANA SMITH: It's time for a triple play-- a few stocks that we're watching here in the final 25 minutes of trading. First up, the buy now, pay later business is facing some headwinds. And take a look at Affirm's shares, because they are sinking today as a result.

Now, the payment company off just around 15%. A couple of things going on here-- rising delinquencies, a slowing economy, fears of a recession posing a pretty challenging road map for this industry. Now, at the end of March-- as of the end of March, 3.7% of outstanding loan dollars were at least 30 days late, more than double what it was just a year ago. Affirm went public about a year and a half ago, just around $49 a share, hit a high of just over $170 back in November. Today, you can see it trading just above $24.

And, Dan, when you take a look at this sector, obviously, a lot of challenges here. One of its competitors, Klarna, announcing that they're laying off just around 10% of its workforce. We talk about layoffs in tech at large and it's starting to hit this buy now, pay later industry as well.

DAN HOWLEY: Yeah, and we are starting to see some layoffs in tech. I actually want to talk about Microsoft as my pick. And, basically, they're seeing some layoffs. There was originally a report that they were seeing a ton, but, no, they're not. It's only in some of the office-- some of the Microsoft Word chat teams. So it's not massive.

But I do want to focus on Microsoft as my pick for the day, specifically because they're rolling out a new laptop. And the reason that's big is because it's coming at a time when we're starting to see PC sales fall back from what they originally were. Last year in Q1, we had seen a jump of 55% year-over-year in overall PC sales. Now, so far this year in Q1, we saw a 5% drop from there.

And obviously, that means that we're dealing with that hangover from the pandemic where everybody had to get out and make sure that they had their own devices, whether they were working from home, doing home schooling, things of that nature. So some of these companies are now going to start seeing those huge sales that they once had start to fall to the wayside, which makes it an interesting time for companies like Microsoft, and let's not forget the big boy in the room, Apple, to be launching some of these products.

DAVE BRIGGS: Yeah, sure is, because we're trying to figure out, Dan, are we going back to the office or are we not? Here in New York City, 5% of workers-- we might be among them-- 5% are back five days a week and only 38% are even in three days a week. And it seems like we have straight plateaued in terms of more people going back to the office. So that looms over the entire industry.

My industry is on fire-- the airlines. And my play, United Airlines, UAL, after a weekend where thousands of flights across the country were canceled due, in part, to the pilot shortage-- news today that United will spend $100 million to expand their pilot training facility in Denver. The work expected to be finished by the end of the year.

United expected to add more than 2,000 pilots this year alone. Nationwide data shows a shortage of more than 12,000 pilots, and that has caused a mess in the skies and at the airports across the country-- all airlines scrambling to address it. Shares of United actually down today more than 4% despite the enormous travel demand we're seeing and TSA numbers rivaling pre-pandemic.

UAL essentially flat year-to-date, down 20%-plus in the last 12 months-- interesting bit of news related to what we talked about earlier, Seana, which is the baby formula shortage. United free of charge flying hundreds of thousands of pounds of baby formula to the United States from London. So kudos.

SEANA SMITH: Yeah, kudos to them for that. Certainly, I mean, we can see this across the board-- airlines demand is back. They're suffering from the labor shortage. It's nothing new here. At least United is trying to do something about it. I mean, I think all the airlines are trying to address it, but it should be an interesting year--

DAVE BRIGGS: This is aggressive, though.

SEANA SMITH: This is very, very aggressive. And it is a much better idea than some of the other ideas that have floated. There was lawmakers maybe potentially proposing to delay retirement ages for pilots from 65 to 67. Then there were thoughts of maybe we should actually reduce their training hours because that would help get more pilots on board faster.

DAVE BRIGGS: Those are really good-- two proposals would scare you as a passenger.

SEANA SMITH: Very scary as a passenger. So I think it's great for United to actually be doing this right now.