The agreement with Atlas air Worldwide includes operation of 20 Boeing Co. The deal comes after Amazon in March reached a similar deal to have Air Transport Services Group manage another 20 Boeing 767 planes for Amazon.
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Amazon announced a deal with cargo freight airline Atlas Air Worldwide on Thursday. As of 10:40 a.m. ET, the stock was up 23.5%. Atlas Air stated Amazon made a decision to an alleged dry rental by its Titan Aircraft rental device, that have a phrase of ten years.
(Nasdaq:AAWW) announced today that it will provide air cargo services to support Amazon’s (Nasdaq:AMZN) package deliveries to its customers.
For the second quarter, the company expects earnings per share to be about three times the level of its first-quarter 2016 adjusted earnings per share of $0.31. Amazon was also granted warrants to buy up to an additional 10% of Atlas Air common shares over seven years, at the same exercise price.
“We are excited to begin a strategic long-term relationship with Amazon to support the continuing expansion of its e-commerce business and to enhance its customer delivery capabilities”, said President and Chief Executive Officer William J. Flynn.
Shares of Purchase, New York-based Atlas Air surged as much as 51 percent, the biggest intraday increase on record since the shares were listed in July 2004 after the company emerged from bankruptcy protection.
Amazon last month started up its own air cargo service, laying down a challenge to companies like Fedex and UPS, which deliver much of its goods.
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Amazon has recently accelerated efforts in parcel delivery, taking on the likes of FedEx and UPS in what could be the company’s next ambitious conquest. Atlas Air’s stock, which was still inactive in premarket trade, has dropped 7.3% year to date through Wednesday, while the S&P 500 has gained 0.4%.
