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Tag: Alphabet Class A

  • Google to lay off 12,000 people — read the memo CEO Sundar Pichai sent to staff

    Google to lay off 12,000 people — read the memo CEO Sundar Pichai sent to staff

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    Google said Friday it will lay off 12,000 people from its workforce, adding to the slew of major U.S. tech companies cutting jobs amid fears of an oncoming recession.

    Sundar Pichai, the CEO of Google and parent company Alphabet, said in an email sent to the company’s staff Friday that the firm will begin making layoffs in the U.S. immediately. In other countries, the process “will take longer due to local laws and practices,” he said. CNBC reported in November that Google employees had been fearing layoffs as its counterparts made cuts and as employees saw changes to the company’s performance ratings system.

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    The web search and video sharing giant will offer U.S.-based employees 16 weeks of severance pay plus two weeks for each additional year they’ve worked at Google, Pichai added.

    Google shares were up more than 5% in early trading after the news.

    Tech companies are facing a variety of challenges at the moment, not least rising interest rates and inflation over the past year that have clobbered technology shares and forced advertisers to cut back on online ad spending.

    Hikes to interest rates from the U.S. Federal Reserve in particular have led to souring appetite for American tech shares. The gloomy macroeconomic climate has in turn piled pressure on those companies to make deep cuts to their workforces.

    LOS ANGELES, CALIFORNIA – JUNE 09: Google CEO Sundar Pichai speaks at a panel at the CEO Summit of the Americas hosted by the U.S. Chamber of Commerce on June 09, 2022 in Los Angeles, California. The CEO Summit entered its second day of events with a formal signing for the “International Coalition to Connect Marine Protected Areas” and a speech from U.S. President Joe Biden. (Photo by Anna Moneymaker/Getty Images)

    Anna Moneymaker | Getty Images News | Getty Images

    On Wednesday, Amazon began a fresh wave of job cuts affecting more than 18,000 people. That same day, Microsoft announced plans to lay off 10,000 workers.

    Twitter, under the leadership of Elon Musk, has also made redundancies, slashing over half of the company’s headcount since taking over as CEO in October.

    The layoff move from Google on Friday comes after CNBC reported Thursday that the firm was deferring a portion of employees’ year-end bonus checks until March or April instead of paying them in full in January.

    Read the full memo Pichai sent out to staff on Friday:

    Googlers,

    I have some difficult news to share. We’ve decided to reduce our workforce by approximately 12,000 roles. We’ve already sent a separate email to employees in the US who are affected. In other countries, this process will take longer due to local laws and practices.

    This will mean saying goodbye to some incredibly talented people we worked hard to hire and have loved working with. I’m deeply sorry for that. The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here.

    Over the past two years we’ve seen periods of dramatic growth. To match and fuel that growth, we hired for a different economic reality than the one we face today.

    I am confident about the huge opportunity in front of us thanks to the strength of our mission, the value of our products and services, and our early investments in AI. To fully capture it, we’ll need to make tough choices. So, we’ve undertaken a rigorous review across product areas and functions to ensure that our people and roles are aligned with our highest priorities as a company. The roles we’re eliminating reflect the outcome of that review. They cut across Alphabet, product areas, functions, levels and regions.

    To the Googlers who are leaving us: Thank you for working so hard to help people and businesses everywhere. Your contributions have been invaluable and we are grateful for them.

    While this transition won’t be easy, we’re going to support employees as they look for their next opportunity.

    In the US:

    • We’ll pay employees during the full notification period (minimum 60 days).
    • We’ll also offer a severance package starting at 16 weeks salary plus two weeks for every additional year at Google, and accelerate at least 16 weeks of GSU vesting.
    • We’ll pay 2022 bonuses and remaining vacation time.
    • We’ll be offering 6 months of healthcare, job placement services, and immigration support for those affected.
    • Outside the US, we’ll support employees in line with local practices.

    As an almost 25-year-old company, we’re bound to go through difficult economic cycles. These are important moments to sharpen our focus, reengineer our cost base, and direct our talent and capital to our highest priorities.

    Being constrained in some areas allows us to bet big on others. Pivoting the company to be AI-first years ago led to groundbreaking advances across our businesses and the whole industry.

    Thanks to those early investments, Google’s products are better than ever. And we’re getting ready to share some entirely new experiences for users, developers and businesses, too. We have a substantial opportunity in front of us with AI across our products and are prepared to approach it boldly and responsibly.

    All this work is a continuation of the “healthy disregard for the impossible” that’s been core to our culture from the beginning. When I look around Google today, I see that same spirit and energy driving our efforts. That’s why I remain optimistic about our ability to deliver on our mission, even on our toughest days. Today is certainly one of them.

    I’m sure you have many questions about how we’ll move forward. We’ll be organizing a town hall on Monday. Check your calendar for details. Until then, please take good care of yourselves as you absorb this difficult news. As part of that, if you are just starting your work day, please feel free to work from home today.

    -Sundar

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  • Google parent to lay off 12,000 workers – memo

    Google parent to lay off 12,000 workers – memo

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    Sundar Pichai, CEO, Alphabet

    Lluis Gene | AFP | Getty Images

    Alphabet is eliminating 12,000 jobs, its chief executive said in a staff memo shared with Reuters.

    The cuts mark the latest to shake the technology sector and come days after rival Microsoft said it would lay off 10,000 workers.

    The job losses affect teams across the company including recruiting and some corporate functions, as well as some engineering and products teams.

    The layoffs are global and impact U.S. staff immediately, Google said.

    The news comes during a period of economic uncertainty as well as technological promise, in which Google and Microsoft have been investing in a fledgling area of software known as generative artificial intelligence.

    Sundar Pichai, Alphabet’s CEO, said in the note, “I am confident about the huge opportunity in front of us thanks to the strength of our mission, the value of our products and services, and our early investments in AI.”

    This story is developing. Please check back for updates.

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  • Ad mogul sees Meta rebounding ‘extremely strongly,’ Amazon ad revenue hitting $100 billion

    Ad mogul sees Meta rebounding ‘extremely strongly,’ Amazon ad revenue hitting $100 billion

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    Sir Martin Sorrell, Executive Chairman, S4 Capital.

    Eóin Noonan | Sportsfile | Getty Images | Web Summit

    Advertising titan Martin Sorrell believes Meta will rebound “extremely strongly this year” and sees a promising outlook for U.S. tech giants, despite a bruising 2022 and mass layoffs.

    U.S. tech companies have let go of more than 60,000 employees in the last year, as slowing economic growth, higher interest rates in response to soaring inflation and competitive challenges squeezed margins and hammered the stock prices of tech behemoths.

    Facebook parent Meta in November announced plans to eliminate 13% of its staff, amounting to more than 11,000 employees. It also issued bleak fourth-quarter guidance that wiped out around a quarter of its market cap, pushing the stock to its lowest since 2016.

    A broad slowdown in online ad spending and competition from new rivals such as TikTok, along with challenges associated with privacy changes to Apple’s iOS, have hampered the social media group’s business over the past year.

    The company has also taken a substantial hit from its massive investment in building its augmented reality world known as the metaverse — a strategy that has proven divisive among analysts and investors.

    Sorrell, executive chairman of U.K. advertising agency S4 Capital, expects Meta to address most of its business challenges in 2023, while benefiting from China’s reopening.

    “I think you’ll see Meta come back extremely strongly this year, on the back of reels and business messenger, to deal with the competition from TikTok and other short form video competitors,” Sorrell told CNBC on the sidelines of the World Economic Forum in Davos, Switzerland.

    “Google had a solid year last year, and I think they’ll have a strong year this year. Amazon increased its advertising revenues from $31bn to $41bn, and I think [it] will hit $100bn in time, despite what you’re seeing in terms of jobs and hiring.”

    He also suggested that the reopening of the Chinese economy would be “huge” for big tech firms, noting that outbound Chinese business, or Chinese companies expanding their businesses abroad, were historically the second-largest profit centers for the likes of Meta, Amazon and Google parent Alphabet.

    Sorrell launched S4, which operates in both the digital advertising and digital transformation spaces, after leaving ad giant WPP in 2018. S4 on Wednesday confirmed its full-year guidance, and Sorrell said his clients’ advertising spending priorities in 2023 would be “topline growth in activation and performance” and “reducing [the] cost of digital transformation.”

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  • Microsoft, Amazon and other tech companies have laid off more than 60,000 employees in the last year

    Microsoft, Amazon and other tech companies have laid off more than 60,000 employees in the last year

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    Microsoft CEO Satya Nadella speaks at the company’s Ignite Spotlight event in Seoul on Nov. 15, 2022.

    SeongJoon Cho | Bloomberg | Getty Images

    The job cuts in tech land are piling up, as companies that led the 10-year bull market adapt to a new reality.

    Microsoft said Wednesday that it’s letting go of 10,000 employees, which will reduce the company’s headcount by less than 5%. Amazon also began a fresh round of job cuts that are expected to eliminate more than 18,000 employees and become the largest workforce reduction in the e-retailer’s 28-year history.

    The layoffs come in a period of slowing growth, higher interest rates to battle inflation, and fears of a possible recession next year.

    Here are some of the major cuts in the tech industry so far. All numbers are approximations based on filings, public statements and media reports:

    Microsoft: 10,000 jobs cut

    Microsoft is reducing 10,000 workers through March 31 as the software maker braces for slower revenue growth. The company also is taking a $1.2 billion charge.

    “I’m confident that Microsoft will emerge from this stronger and more competitive,” CEO Satya Nadella announced in a memo to employees that was posted on the company website Wednesday. Some employees will find out this week if they’re losing their jobs, he wrote.

    Amazon: 18,000 jobs cut

    Earlier this month, Amazon CEO Andy Jassy said the company was planning to lay off more than 18,000 employees, primarily in its human resources and stores divisions. It came after Amazon said in November it was looking to cut staff, including in its devices and recruiting organizations. CNBC reported at the time that the company was looking to lay off about 10,000 employees.

    Amazon went on a hiring spree during the Covid-19 pandemic. The company’s global workforce swelled to more than 1.6 million by the end of 2021, up from 798,000 in the fourth quarter of 2019.

    Alphabet (Verily): 230 jobs cut

    Google parent company Alphabet had largely avoided layoffs until January, when it cut 15% of employees from Verily, its health sciences division. Google itself has not undertaken any significant layoffs as of Jan. 18, but employees are increasingly growing worried that the ax may soon fall.

    Crypto.com: 500 jobs cut

    Crypto.com announced plans to lay off 20% of its workforce Jan. 13. The company had 2,450 employees, according to PitchBook data, suggesting around 490 employees were laid off. 

    CEO Kris Marszalek said in a blog post that the crypto exchange grew “ambitiously” but was unable to weather the collapse of Sam Bankman-Fried’s crypto empire FTX without the further cuts.

    “All impacted personnel have already been notified,” Marszalek said in a post.

    Coinbase: 2,000 jobs cut

    On Jan. 10, Coinbase announced plans to cut about a fifth of its workforce as it looks to preserve cash during the crypto market downturn.

    The exchange plans to cut 950 jobs, according to a blog post. Coinbase, which had roughly 4,700 employees as of the end of September, had already slashed 18% of its workforce in June saying it needed to manage costs after growing “too quickly” during the bull market.

    “With perfect hindsight, looking back, we should have done more,” CEO Brian Armstrong told CNBC in a phone interview at the time. “The best you can do is react quickly once information becomes available, and that’s what we’re doing in this case.”

    Salesforce: 7,000 jobs cut

    Salesforce is cutting 10% of its personnel and reducing some office space as part of a restructuring plan, the company announced Jan. 4. It employed more than 79,000 workers as of December.

    In a letter to employees, co-CEO Marc Benioff said customers have been more “measured” in their purchasing decisions given the challenging macroeconomic environment, which led Salesforce to make the “very difficult decision” to lay off workers.

    Salesforce said it will record charges of $1 billion to $1.4 billion related to the headcount reductions, and $450 million to $650 million related to the office space reductions.

    Meta: 11,000 jobs cut

    Facebook parent Meta announced its most significant round of layoffs ever in November. The company said it plans to eliminate 13% of its staff, which amounts to more than 11,000 employees.

    Meta‘s disappointing guidance for the fourth quarter of 2022 wiped out one-fourth of the company’s market cap and pushed the stock to its lowest level since 2016.

    The tech giant’s cuts come after it expanded headcount by about 60% during the pandemic. The business has been hurt by competition from rivals such as TikTok, a broad slowdown in online ad spending and challenges from Apple’s iOS changes.

    Twitter: 3,700 jobs cut

    Lyft: 700 jobs cut 

    Lyft announced in November that it cut 13% of its staff, or about 700 jobs. In a letter to employees, CEO Logan Green and President John Zimmer pointed to “a probable recession sometime in the next year” and rising ride-share insurance costs.

    For laid-off workers, the ride-hailing company promised 10 weeks of pay, health care coverage through the end of April, accelerated equity vesting for the Nov. 20 vesting date and recruiting assistance. Workers who had been at the company for more than four years will get an extra four weeks of pay, they added.

    Stripe: 1,100 jobs cut

    Online payments giant Stripe announced plans to lay off roughly 14% of its staff, which amounts to about 1,100 employees, in November. 

    CEO Patrick Collison wrote in a memo to staff that the cuts were necessary amid rising inflation, fears of a looming recession, higher interest rates, energy shocks, tighter investment budgets and sparser startup funding. Taken together, these factors signal “that 2022 represents the beginning of a different economic climate,” he said.

    Stripe was valued at $95 billion last year, and reportedly lowered its internal valuation to $74 billion in July.

    Shopify: 1,000 jobs cut

    In July, Shopify announced it laid off 1,000 employees, which equals 10% of its global workforce. 

    In a memo to staff, CEO Tobi Lutke acknowledged he had misjudged how long the pandemic-driven e-commerce boom would last, and said the company is being hit by a broader pullback in online spending. Its stock price is down 78% in 2022.

    Netflix: 450 jobs cut

    Netflix announced two rounds of layoffs. In May, the streaming service eliminated 150 jobs after the company reported its first subscriber loss in a decade. In late June, it announced another 300 layoffs. 

    In a statement to employees, Netflix said, “While we continue to invest significantly in the business, we made these adjustments so that our costs are growing in line with our slower revenue growth.” 

    Snap: 1,000 jobs cut 

    In late August, Snap announced it laid off 20% of its workforce, which equates to over 1,000 employees. 

    Snap CEO Evan Spiegel told employees in a memo that the company needs to restructure its business to deal with its financial challenges. He said the company’s quarterly year-over-year revenue growth rate of 8% “is well below what we were expecting earlier this year.”

    Robinhood: 1,100 jobs cut

    Retail brokerage firm Robinhood slashed 23% of its staff in August, after cutting 9% of its workforce in April. Based on public filings and reports, that amounts to more than 1,100 employees.

    Robinhood CEO Vlad Tenev blamed “deterioration of the macro environment, with inflation at 40-year highs accompanied by a broad crypto market crash.”

    Tesla: 6,000 jobs cut

    In June, Tesla CEO Elon Musk wrote in an email to all employees that the company was cutting 10% of salaried workers. The Wall Street Journal estimated the reductions would affect about 6,000 employees, based on public filings.

    “Tesla will be reducing salaried headcount by 10% as we have become overstaffed in many areas,” Musk wrote. “Note this does not apply to anyone actually building cars, battery packs or installing solar. Hourly headcount will increase.”

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  • Microsoft is laying off 10,000 employees

    Microsoft is laying off 10,000 employees

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    Microsoft said Wednesday that it’s letting go of 10,000 employees through March 31 as the software maker braces for slower revenue growth. The company is also taking a $1.2 billion charge in the fiscal second quarter, which will result in a negative impact of 12 cents to earnings per share.

    Alphabet, Amazon and Salesforce are among the technology companies that have lowered head count in recent weeks. The contraction comes after demand for cloud computing and collaboration services picked up as enterprises, government agencies and schools encouraged remote work to reduce Covid exposure.

    Rising prices have prompted companies to become more careful about technology spending, hurting prospects for the tech stocks that outperformed other market sectors year after year. Now Microsoft and its peers are taking stock. In July Microsoft said it will trim less than 1% of employees, and in October it confirmed an additional round of job cuts that reportedly affected fewer than 1,000 workers.

    “I’m confident that Microsoft will emerge from this stronger and more competitive,” CEO Satya Nadella told employees in a memo that was posted on Microsoft’s website. The move will reduce Microsoft’s head count by less than 5%, and some employees will find out this week if they’re losing their jobs, he wrote.

    Microsoft shares moved modestly higher at the U.S. open after the announcement.

    The workforce adjustment will hit all teams and geographies, with more impact coming to sales and marketing than engineering, a company spokesperson told CNBC in an interview.

    Employees in the U.S. who are eligible for benefits will receive severance that’s above the market and six months of health care and stock vesting, along with 60 days’ notice before their work ends, Nadella wrote.

    Nadella reiterated trends in the business climate that he has described in recent months.

    “As we saw customers accelerate their digital spend during the pandemic, we’re now seeing them optimize their digital spend to do more with less,” he wrote. “We’re also seeing organizations in every industry and geography exercise caution as some parts of the world are in a recession and other parts are anticipating one.”

    Earlier this month Nadella had indicated the company might have to make adjustments.

    “I think for us as a global company, we’re not going to be immune from what’s happening in the macro,” he said in an interview with CNBC-TV18. “We will have to also get our own sort of operational focus on making sure our expenses are in line with our revenue growth.”

    Microsoft has called for 2% revenue growth in the fiscal second quarter, which would be the slowest rate since 2016.

    The layoffs are not a major surprise given the deterioration in Microsoft’s cloud-infrastructure and Windows operating system sales over the past few quarters, said Gil Luria, an analyst at DA Davidson who has a buy rating on Microsoft stock.

    Investors are very concerned about the margins of many technology companies, including Microsoft, he said.

    “I think there’s been a broad expectation from all these companies, especially the ones that hired more over the last two to three years, to adapt and react to a slower-growth environment and show the discipline and the focus on shareholder value that investors need to feel right now as they try to ride out a slower-growing economy,” Luria told CNBC in an interview.

    Major layoffs aren’t an annual exercise for 47-year-old Microsoft, but they do happen occasionally. In 2017 Microsoft laid off thousands of employees in a broad reorganization of its sales unit. In 2014, following the acquisition of Nokia’s devices and services business, Microsoft cut 18,000 people.

    The charge relates to severance, changes to the company’s hardware lineup and the cost of consolidating leases, Nadella wrote.

    “Every one of us and every team across the company must raise the bar and perform better than the competition to deliver meaningful innovation that customers, communities, and countries can truly benefit from,” Nadella wrote. “If we deliver on this, we will emerge stronger and thrive long into the future; it’s as simple as that.”

    WATCH: Microsoft’s OpenAI investment won’t help it rival Google search, says tech analyst

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  • Jim Cramer’s Investing Club meeting Wednesday: Overbought market, Salesforce, Alphabet

    Jim Cramer’s Investing Club meeting Wednesday: Overbought market, Salesforce, Alphabet

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  • Global spending on mobile games falls 5% as high inflation causes market to cool

    Global spending on mobile games falls 5% as high inflation causes market to cool

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    The Candy Crush Saga logo displayed on a phone screen.

    Jakub Porzycki | NurPhoto via Getty Images

    Spending on mobile games declined last year as consumers got more frugal with their purchasing decisions in response to rising inflation, according to a report from app analytics firm Data.ai.

    Mobile game spending fell 5% globally in 2022, to $110 billion, Data.ai, which was formerly known as App Annie, said in its “State of Mobile” report Wednesday. The report also looks at the broader state of sectors like mobile ads, retail and social media apps.

    Nevertheless, first-time installs of mobile titles rose 8% to a record 90 billion, with so-called “hypercasual” titles leading the gains.

    “We are seeing this major theme emerge of people being more price sensitive and financially more conservative,” Lexi Sydow, head of insights at Data.ai, told CNBC, adding that the “biggest hit” to spending on apps was in gaming.

    Faced with economic headwinds such as higher prices and borrowing costs, people are cutting back on discretionary purchases. Gaming especially has come under pressure.

    Global sales of games and services, including console and PC games, were expected to contract 1.2% year-on-year to $188 billion in 2022, according to a July research note from market data firm Ampere Analysis.

    In recent years, growth in mobile gaming has been the dominant story in the games industry, with major publishers making big bets on mobile game developers.

    Read more about tech and crypto from CNBC Pro

    Early last year, Take-Two bought mobile gaming firm Zynga for $12.7 billion. In 2016, the maker of Candy Crush Saga, King, was purchased by Activision Blizzard for $5.9 billion. U.S. tech giant Microsoft, meanwhile, is banking on continued growth in mobile gaming with its proposed $69 billion takeover of Activision Blizzard.

    That growth has been challenged lately by a number of macroeconomic headwinds, however, including a rise in the cost of living and higher interest rates.

    In 2020, Microsoft and Sony launched their respective next-generation gaming consoles, giving mobile more competition.

    Last year also saw a return to in-person activities and a normalization of travel rules from the height of the Covid-19 pandemic in 2020, when much of the world was hunkering down at home.

    Non-gaming apps proved more resilient in 2022, according to Data.ai’s research, with the value of purchases in such apps rising 6% year-over-year to $58 billion. The growth was driven mainly by subscriptions and in-app purchases in streaming platforms, dating apps and short-form video services like TikTok.

    Downloads of non-gaming apps grew 13% from the previous year, to 165 billion.

    That did little to offset the slump in mobile game spending, however, with spending across app stores slipping 2% to $167 billion. The figures include installs on third-party Android marketplaces in China, where Google’s official Play app store is banned.

    The market faces further headwinds in 2023, with recently introduced privacy measures from Apple expected to place greater strain on app makers.

    Apple launched its App Tracking Transparency feature, which gives users a prompt asking whether they wish to be targeted by advertisers, in 2021.

    Data.ai expects global app spend on games specifically to drop a further 3% to $107 billion this year as a result of decreased disposable income and changes to privacy.

    Google plans to adopt privacy curbs similar to Apple’s that would limit tracking across Android apps.

    “With limitations on your targeting capabilities from an advertiser standpoint, it becomes harder to attract the big whales who spend the most in games,” Sydow explained.

    The changes spell trouble for Meta, owner of the Facebook and Instagram social media platforms. Meta Chief Financial Officer David Wehner warned previously that Apple’s ATT could decrease its 2022 sales by $10 billion. The company made most of its $117.9 billion revenue in 2021 from advertising sales.

    Meta faces tense competition from rival firm TikTok. The Chinese-owned short video app last year reached $6 billion in overall lifetime spending and is only the second non-game app to achieve that milestone after Tinder, according to Data.ai.

    Sydow said the effects of Apple’s privacy measures hadn’t yet appeared in the 2022 numbers — with total spend dropping across both iOS and Google Play — but was likely to have a much greater impact this year.

    Despite the overall spending slowdown in 2022, there was still “more demand for mobile service than ever before,” Sydow added. First-time app downloads grew 11% to 255 billion, Data.ai said, while hours spent in apps climbed 9% to a record 4.1 trillion.

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  • Cramer: This market is split in two and only one part is worth owning right now

    Cramer: This market is split in two and only one part is worth owning right now

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    Jim Cramer at the NYSE, June 30, 2022.

    Virginia Sherwood | CNBC

    Hardly a day goes by without someone asking me, “Why do you like Jay Powell so much?” He will question whether I am somehow buddies with the Federal Reserve chair, or assume I knew him before he got the job.

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  • Did the market already show its hand in the first week of 2023? What we’ve learned so far

    Did the market already show its hand in the first week of 2023? What we’ve learned so far

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  • California forces companies to show pay on job listings, revealing big tech salaries

    California forces companies to show pay on job listings, revealing big tech salaries

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    Steve Proehl | Corbis Unreleased | Getty Images

    A new law that went into effect this week requires most California employers to disclose salaries on job listings.

    The law affects every company with more than 15 employees looking to fill a job that could be performed from the state of California. It covers hourly and temporary work, all the way up to openings for highly paid technology executives.

    That means it’s now possible to know the salaries top tech companies pay their workers. For example:

    Notably, these salary listings do not include any bonuses or equity grants, which many tech companies use to attract and retain employees.

    California is the latest and biggest of the states and cities that have enacted pay transparency laws, including Colorado and New York City. But more than 20% of Fortune 500 companies are based in California, including leaders in technology and media, and advocates hope that California’s new law will be the tipping point that turns posting salary information into standard practice.

    In the U.S., there are now 13 cities and states that require employers to share salary information, covering about 1 in 4 workers, according to Payscale, a software firm focusing on salary comparison.

    California’s pay transparency law is intended to reduce gender and race pay gaps and help minorities and women better compete in the labor market. For example, people can compare their current pay with job listings with the same job title and see if they’re being underpaid.

    Women earn about 83 cents for every dollar a man earns, according to the U.S. Census.

    “You’re going to need a lot of different elements in place in order for men and women to get paid the same for the same amount of work and the same experience,” said Monique Limón, the California state senator who sponsored the new law. “And one of those is transparency around salary ranges.”

    But the new disclosures under the law might not tell the whole story of what a job pays. Companies can choose to display wide pay ranges, violating the spirit of the law, and the law doesn’t require companies to reveal bonuses or equity compensation.

    The law could also penalize ambitious workers who are gunning for more money because of their experience or skills, the California Chamber of Commerce said last year when opposing the bill. Some employers might be wary of posting pay to prevent bidding wars for top talent.

    In a comment to CNBC, a Meta spokesperson said, “To ensure fairness and eliminate bias in our compensation systems, we regularly conduct pay equity analysis, and our latest analysis confirms that we continue to have pay equity across genders globally and by race in the US for people in similar jobs.” The firm also noted that it generally pays full-time employees in equity as well as cash.

    Apple and Google did not immediately respond to requests for comment.

    The new law

    There are two primary components to California Senate Bill No. 1162, which was passed in September and went into effect Jan. 1.

    First is the pay transparency component on job listings, which applies to any company with more than 15 employees if the job could be done in California.

    The second part requires companies with more than 100 employees to submit a pay data report to the state of California with detailed salary information broken down by race, sex and job category. Companies have to provide a similar report on the federal level, but California now requires more details.

    Employers are required to maintain detailed records of each job title and its wage history, and California’s labor commissioner can inspect those records. California can enforce the law through fines and can investigate violations. The reports won’t be published publicly under the new law.

    Limón said the bill helps narrow pay gaps by giving information to people so they can negotiate their pay better or determine if they are being underpaid for their experience and skills. It will also help the state make sure companies are following existing equal pay laws.

    “The reason this is important is that we are not able to address problems that we cannot see,” she said.

    Limón said she also hopes that the requirement will help California companies recruit the best talent and compete against other states that don’t require employers to post salaries.

    Pay transparency laws could also spur companies to raise wages after they see that rivals are offering higher salaries. Some companies could even choose to post salary ranges on job listings where it’s not required.

    Ultimately, she said, helping to ensure women and people of color are getting paid equally will help California’s economy.

    “The consequence is not just for an individual; there are economic consequences for the state for people being underpaid,” Limón said. “That means that their earning power and how they’re able to contribute to this economy in California, whether it’s through a sales market, a housing market, through investment, is limited, because they are not being paid equitably.”

    Loopholes

    The new law doesn’t require employers to post total compensation, meaning that companies can leave out information about stock grants and bonuses, offering an incomplete picture for some highly paid jobs.

    For high-paying jobs in the technology industry, equity compensation in the form of restricted stock units can make up a large percentage of an employee’s take-home pay. In industries such as finance, bonuses make up a big portion of annual pay.

    “Especially for tech employees, ultimately people want to know how much they’re getting in total compensation,” said Zuhayeer Musa, co-founder of Levels.fyi, a firm focused on recruiting and coaching for technology workers which crowdsources compensation. “Sometimes stock compensation can be more than 50% of your actual total comp.”

    Musa said stock from big tech companies is basically liquid because it can be immediately sold on the stock market.

    The new law also allows companies to provide wide ranges for pay, sometimes ranging over $100,000 or more between the lowest salary and the highest salary for a position. That seemingly violates the spirit of the law, but companies say the ranges are realistic because base pay can vary widely depending on skills, qualifications, experience and location.

    Companies may be open to hiring candidates with a range of experience — starting from entry level to a more senior person — for a particular opening, said Lulu Seikaly, senior corporate attorney at Payscale.

    Seikaly said she recommends clients post job listings with a specific seniority level to narrow the potential pay range.

    “When we talk to customers, and they ask what do you think is a good-faith range, we tell them that’s a business decision, but the way we would do it, especially from the legal side, if you post by levels, that’s going to cover you a lot more than posting one wide range,” Seikaly said.

    Some California companies are not listing salaries for jobs clearly intended to be performed in other states, but advocates hope California’s new law could spark more salary disclosures around the country. After all, a job listing with an explicit starting salary or range is likely to attract more candidates than one with unclear pay.

    “I was telling some folks this morning that pay transparency right now is kind of the exception,” Seikaly said. “Give it five to 10 years, I think it’ll end up being the norm.”

    Gender pay gap remains despite more women entering the work force

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  • Top Wall Street analysts like these stocks in 2023

    Top Wall Street analysts like these stocks in 2023

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    We step into the new year with a largely unchanged macroeconomic backdrop and a recession waiting for us. However, investors can maintain a healthy portfolio if they keep a longer-term view, shutting out all the noise.

    In that context, we kickstart 2023 with five stocks picked by Wall Street’s top analysts, according to TipRanks, a service that ranks analysts based on their past performance.

    STAAR Surgical

    Medical technology company STAAR Surgical (STAA) is benefiting from solid demand for refractive corrections (surgical corrections for eye conditions) across the world. Moreover, BTIG analyst Ryan Zimmerman believes that favorable demographic trends, including an aging population and a rising number of myopia cases, are also driving demand for STAAR’s products.

    Earlier in December, the company announced that its president and chief executive officer, Caren Mason, is retiring by the end of the month. Mason will be succeeded by Thomas Frinzi, who has earlier served as head of Johnson & Johnson’s vision unit and president of Abbott Medical Optics. Zimmerman said the appointment of Frinzi can appease investors, thanks to having 40 years of experience in medical optics. (See Staar Surgical Hedge Fund Trading Activity on TipRanks)​

    The analyst is also upbeat about the demand environment for STAAR’s products across different time periods. “Next-gen lenses to new markets should drive near-term growth, while expanded indications, presbyopia, and cataract companion drive long-term growth,” noted Zimmerman, who reiterated a buy rating on the stock with a price target of $80.

    Zimmerman ranks No. 861 among more than 8,000 analysts tracked on TipRanks. Moreover, 44% of his ratings have been profitable, with each rating generating 7.2% average returns.

    Papa John’s 

    Quick-service pizza chain Papa John’s (PZZA) stock has depreciated significantly this year due to challenges in the U.K. and inflationary pressures, but its longer-term outlook remains resilient. BTIG analyst Peter Saleh noted that during these times when inflation is high and a recession is on the horizon, lower-income consumers are spending less on eating out. Therefore, Papa John’s value offerings like Papa Pairings are attracting new lower-income guests.

    After surveying more than 1,000 Papa John’s customers, Saleh found that only a low-single-digit percentage of them find the menu prices too expensive, even after the company raised prices by 3-4 times in 2022. Encouraged by these trends, the analyst mildly raised his 4Q22 domestic same-store sales expectations. (See Papa John’s International Insider Trading Activity on TipRanks)

    Saleh reiterated a buy rating on the stock with a price target of $100. “We believe new leadership has the right strategies in place to engineer a turnaround; these efforts have already translated into better operating efficiency, stronger franchisee alignment, and improved net unit growth, and we expect these will continue to build in 2022/23. We see several near- and long-term levers to drive shareholder value that have started to unfold and will allow Papa John’s to again outperform peers, leading to our Buy rating,” said Saleh.

    Saleh has a 524th position among more than 8,000 analysts on TipRanks. Each of his 59% successful ratings has garnered an average return of 10.3%.

    Alphabet

    The next on our list is Monness Crespi Hardt analyst Brian White’s stock pick, Alphabet (GOOGL), which has proved to be more resilient than its peers in the digital ad market this year. Moreover, the company could mitigate impact on its business with the help of strong growth in Google Cloud.

    White said as “a challenging year nears an end, but harrowing headwinds persist in 2023,” Alphabet has started to reduce its expenditures to be better prepared. (See Alphabet Class A Stock Chart on TipRanks)

    “In our view, Alphabet is well positioned to capitalize on the long-term digital ad trend, participate in the shift of workloads to the cloud, and benefit from digital transformation,” said White, justifying his stance on Alphabet’s prospects for 2023. He reiterated a buy rating on the stock with a price target of $135.

    The analyst noted that Alphabet has delivered 23% sales growth per annum and 27% operating profits over the last five years. Along with a dominant position in the search engine area with leadership in digital advertising, White believes that the stock should trade at a healthy premium to the technology sector in the long run.

    White, a 5-star analyst on TipRanks, stands at No. 71 among more than 8,000 tracked analysts. Moreover, 62% of his ratings have been profitable, with each rating delivering an average return of 17.2%.

    Verizon

    Wireless and wireline communications services Verizon (VZ) is another name on our top-5 list this week. One of the picks of 5-star analyst Ivan Feinseth of Tigress Financial Partners, Verizon is well-positioned to gain from ongoing 5G wireless subscription growth as well as new growth opportunities in fiber and fixed broadband connectivity.

    Feinseth expects that its “size advantage” and prospects in the rapid deployment of high-speed 5G connectivity in the U.S. should fuel further growth in wireless subscribers. (See Verizon Stock Investors sentiment on TipRanks)

    Verizon boasts of a strong balance sheet and cash flow generating abilities that allow the company to invest in spectrum expansion and other growth initiatives. Moreover, a healthy financial position helps the company maintain a compelling dividend yield and consistent dividend hikes.

    “VZ’s expected generation of $54.53 billion in Economic Operating Cash Flow (EBITDAR) over the near-term provides it with significant cash to fund its 5G high-speed network rollout, spectrum purchases, other growth initiatives, strategic acquisitions, and ongoing dividend increases,” said Feinseth, who holds the 283rd position among more than 8,000 analysts on TipRanks.

    The analyst reiterated a buy rating and price target of $64 (adjusted lower from $68) on VZ stock. 

    Remarkably, 58% of Feinseth’s ratings have generated profits, and each rating has brought a 10.3% average return.

    MongoDB

    General purpose database platform provider MongoDB (MDB) is among Feinseth’s buy stocks that we think is a great addition to portfolios this week. Feinseth said that the company’s “industry-leading open-source database software structure” is attracting new customers.

    Despite lowering his price target to $365 from $575, the company is well-poised to profit from gradual increase in enterprise IT spending when companies adopt MongoDB’s highly customizable and scalable Database as a Service, Feinseth said. (See MongoDB Website Traffic on TipRanks)

    “The rapid acceleration of hosted and hybrid cloud migration is driving increasing demands for scalable, customizable, and developer-friendly database architectures that will continue to drive growth in MDB’s subscription-based revenue model. This will drive an ongoing acceleration in Business Performance trends, which will drive an increasing Return on Capital (ROC), leading to significant gains in Economic Profit and long-term shareholder value creation,” said Feinseth, justifying his stance on MDB stock.

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  • TikTok banned on government devices under spending bill passed by Congress

    TikTok banned on government devices under spending bill passed by Congress

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    Researchers at the University of Vermont analyzed 1,000 TikTok videos under the most popular hashtags related to body image and eating

    Jakub Porzycki | NurPhoto | Getty Images

    Under the bipartisan spending bill that passed both chambers of Congress on Friday, TikTok will be banned from government devices, underscoring the growing concern about the popular video-sharing app owned by China’s ByteDance.

    The bill, which still has to be signed into law by President Joe Biden, also calls on e-commerce platforms to do more vetting to help deter counterfeit goods from being sold online, and forces companies pursuing large mergers to pay more to file with federal antitrust agencies.

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    Congress failed to pass many of the most aggressive bills targeting tech, including antitrust legislation that would require app stores developed by Apple and Google to give developers more payment options, and a measure mandating new guardrails to protect kids online. And though Congress made more headway this year than in the past toward a compromise bill on national privacy standards, there remains only a patchwork of state laws determining how consumer data is protected.

    Center-left tech industry group Chamber of Progress cheered the exclusion of several antitrust bills that would have targeted its backers, which include Apple, Amazon, Google and Meta.

    “What you don’t see in this year’s omnibus are the more controversial measures that have raised red flags on issues like content moderation,” Chamber of Progress CEO Adam Kovacevich said in a statement following the release of the package text earlier this week. The group earlier raised concerns about a prominent antitrust measure, the American Innovation and Choice Online Act.

    Another industry group, NetChoice, also applauded Congress for “refusing to include radical and unchecked progressive proposals to overhaul American antitrust law in this omnibus.”

    But the bills lawmakers passed in the spending package will still make their mark on the tech industry in other ways.

    TikTok ban on government devices

    The banning of TikTok on government devices could benefit rival platforms like Snap and Meta’s Facebook and Instagram that also fight for young consumers’ attention. The bill includes an exception for law enforcement, national security and research purposes.

    Lawmakers on both sides of the aisle, as well as FBI Director Christopher Wray, have voiced fear that TikTok’s ownership structure could make U.S. user data vulnerable, since companies based in China may be required by law to hand over user information. TikTok has repeatedly said its U.S. user data is not based in China, though those assurances have done little to alleviate concern.

    The company has been working toward a deal with the administration to assuage national security fears through the Committee on Foreign Investment in the U.S.

    “We’re disappointed that Congress has moved to ban TikTok on government devices — a political gesture that will do nothing to advance national security interests — rather than encouraging the Administration to conclude its national security review,” a TikTok spokesperson said in a statement following the release of the package text. “The agreement under review by CFIUS will meaningfully address any security concerns that have been raised at both the federal and state level. These plans have been developed under the oversight of our country’s top national security agencies — plans that we are well underway in implementing — to further secure our platform in the United States, and we will continue to brief lawmakers on them.”

    Deterring online counterfeit sales

    The spending package also includes the INFORM Consumers Act, which seeks to deter counterfeit, stolen or harmful products from being sold online. The bill requires online marketplaces like Amazon to promptly collect information like bank and contact details from “any high-volume third party seller” and to verify that data.

    Though Amazon initially opposed the bill last year, writing that it was “pushed by some big-box retailers” and claiming it would punish small businesses that sell online, the company ended up supporting a version of the bill, saying it was important to have a federal standard rather than a patchwork of state laws. Etsy and eBay had earlier supported the bill.

    “Passing the bipartisan INFORM Act would be a major victory for consumers, who deserve to know who they’re buying from when they visit an online marketplace,” Kovacevich said in a statement. “This legislation has been through years of hearings and markups and has earned the support of both parties as well as brick-and-mortar stores and online marketplaces.”

    Etsy’s head of Americas advocacy and public policy, Jeffrey Zubricki, said in a statement the bill “will achieve our shared goal of protecting consumers from bad actors while avoiding overly broad disclosure requirements that would harm our sellers’ privacy and hinder their ability to run their creative businesses.”

    Higher fees for big mergers

    While more ambitious antitrust measures targeting digital platforms didn’t make it into the end-of-year legislation, there is one bill to help raise money for the antitrust agencies that scrutinize mergers. The Merger Filing Fee Modernization Act will raise the cost companies pursuing large mergers must pay to file with the antitrust agencies, as they’re required to do under the law. The bill also lowers the cost for smaller deals and allows the fees to be adjusted each year based on the consumer price index.

    The measure is meant to help fund the Federal Trade Commission and Department of Justice Antitrust Division, which have seen a large uptick in merger filings over the past few years without adequate budget increases.

    While it fell short of antitrust advocates’ hopes, the inclusion of the merger filing fee bill still gained praise.

    “This is a major milestone for the anti-monopoly movement,” said Sarah Miller, executive director of the American Economic Liberties Project, backed in part by the Omidyar Network. Miller said the bill will “significantly strengthen antitrust law for the first time since 1976.”

    “Big Tech, Big Ag and Big Pharma spent extraordinary sums in an unprecedented effort to keep Congress from delivering on antitrust reform and undermine the ability of state and federal enforcers to uphold the law — and they lost,” Miller added.

    Sen. Amy Klobuchar, D-Minn., who sponsored the bill, said in a statement earlier this week its inclusion “is an important step to restructure merger fees after decades of the status quo so we can provide our antitrust enforcers with the resources they need to do their jobs.”

    “This is clearly the beginning of this fight and not the end,” she said. “I will continue to work across the aisle to protect consumers and strengthen competition.”

    Empowering state AGs in antitrust cases

    Another antitrust bill included in the package was a version of the State Antitrust Enforcement Venue Act. The bill gives state attorneys general the same power as federal enforcers in antitrust cases to choose the district in which they bring their cases and prevent them from being consolidated in a different district.

    Under the legislation, companies defending against claims of antitrust violations won’t be able to pick what they perceive to be a more favorable venue to fight the case.

    That’s what happened in an antitrust case against Google brought by a group of state attorneys general accusing the company of illegally monopolizing the digital advertising market. The company transferred the case from Texas to New York, to be heard alongside private antitrust complaints against the company in the pretrial proceedings.

    Last year, attorneys general from 52 states and territories wrote Congress in support of the legislation.

    Transparency on ransomware attacks

    The bipartisan RANSOMWARE Act also made it into the spending bill, requiring the FTC to report to Congress on the number and types of foreign ransomware or other cyberattack complaints it receives.

    The FTC also must report to Congress trends in numbers it sees in these complaints, including those that come from individuals, companies or governments of foreign adversaries like China, North Korea, Iran and Russia. And it must share information on its litigation actions related to these cases and their results.

    The FTC can also share recommendations for new laws to strengthen resilience against these attacks as well as for best practices that businesses can follow to protect themselves.

    Research into tech impacts on kids

    A version of the Children and Media Research Advancement (CAMRA) Act is included in the package, directing the Department of Health and Human Services to conduct or support research on the effects of media and technology on infants, kids and adolescents.

    Those effects could include the impact on cognitive, mental and physical health by technologies like social media, artificial intelligence, video games or virtual reality, according to the legislation. The director of the National Institutes of Health must deliver a report to Congress on its work within two years of the law’s enactment.

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    WATCH: Lawmakers grill TikTok, YouTube, Snap executives

    Lawmakers grill TikTok, YouTube, Snap executives

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  • YouTube’s NFL ‘Sunday Ticket’ deal is a win for traditional TV networks, too – here’s why

    YouTube’s NFL ‘Sunday Ticket’ deal is a win for traditional TV networks, too – here’s why

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    Los Angeles Chargers running back Austin Ekeler, center, runs for extra yardage while Tennessee Titans linebacker Monty Rice, left, and safety Andrew Adams (47) attempt a tackle during the second half at SoFi Stadium on Sunday, Dec. 18, 2022 in Los Angeles, CA.

    Allen J. Schaben | Los Angeles Times | Getty Images

    The National Football League had a streaming service in mind when it was looking for a new home for the rights to its “Sunday Ticket” subscription game package. 

    The league got its desired outcome in a deal with Google‘s YouTube. Traditional TV networks got what they wanted out of it, too. 

    Beginning next season, “Sunday Ticket” will be offered in two ways through YouTube: either as an add-on to its YouTube TV service, a digital TV bundle that mirrors the traditional pay-TV package, or a la carte through YouTube’s Primetime Channels. 

    YouTube is paying about $2 billion annually for residential rights over the next seven years, CNBC reported. The process concluded this week after months of negotiations with potential winners like Apple, Amazon and Disney, which operates ESPN streaming service ESPN+.

    While pricing hasn’t been determined, consumers will likely get more bang for their buck by subscribing to YouTubeTV and adding on “Sunday Ticket,” which shows out-of-market NFL games on Sunday afternoons. It’ll also give them access to nearly all NFL games in one place. Google’s YouTube TV bundle includes broadcast stations like CBS, Fox and NBC. Fellow tech giants Apple and Amazon don’t provide a similar bundle offering with broadcast or pay-TV networks, such as ESPN and NFL Network.

    Sports, and particularly the NFL, have long been considered the glue holding the traditional TV bundle together. Sports networks, and those that offer live games, attract some of the highest fees from pay-TV operators, and they score some of the highest ratings. The NFL makes large sums for the airing of live games.

    For this reason, executives at longstanding broadcast and pay-TV networks, who declined to to be named because they weren’t permitted to talk publicly, found the deal with YouTube a favorable outcome over Apple or Amazon getting the package. 

    YouTube and the NFL didn’t immediately comment.

    Long live the bundle 

    Paramount‘s CBS and Fox broadcast weekly Sunday afternoon games. Comcast‘s NBC is the home of “Sunday Night Football,” and Disney, which owns ESPN and ABC, holds the rights to “Monday Night Football.” 

    Each has paid hefty sums for those rights. Last year, collectively, the four agreed to pay more than $100 billion over the course of 11-year-long packages to air NFL games. 

    For networks like NBC, CBS and ESPN, they are simultaneously airing NFL games on their fledgling streaming platforms for the audience that has turned away from the pay-TV bundle. 

    All of those games are available through Google’s YouTube TV package, with the exception of “Thursday Night Football,” which now streams exclusively on Amazon Prime.

    “YouTube in many ways is a very unique and interesting platform,” Dhruv Prasad, the NFL’s senior vice president of media strategy and strategic investments, said on a call with media this week, “because we have chosen a partner that actually supports, in many ways, our existing distribution with Sunday afternoon and night, and Monday night. We actually think this is a model where this will result in a real benefit with existing partners.”

    While deals with traditional operators are wildly lucrative for the NFL, the league has been open about wanting more streaming partners. NFL Commissioner Roger Goodell said long before the outcome of the negotiations the league saw a streaming partner as the future of “Sunday Ticket,” which has only been offered through satellite-TV operator DirecTV since 1994. 

    Although YouTube is streaming only, it offers a package that keeps the TV bundle alive – by paying similar rates as typical distributors, which has in turn caused a spike in the price of subscriptions. YouTube TV had more than 5.3 million subscribers as of the third quarter, putting it above its competitors like Disney’s Hulu Live TV+, Fubo TV and Dish’s Sling, according to data from MoffettNathanson. 

    “This is a win for YouTube TV as it serves a larger goal for them getting more subscribers. And in the end, it helps a package of linear channels,” said sports media consultant Pat Crakes, noting YouTube also secured the rights “at a good price,” to help them bolster their streaming service. 

    Adding another NFL property to the equation to make a TV bundle stickier with customers is a positive for networks, executives told CNBC. 

    The streaming business, particularly for legacy media companies, has most recently been under pressure. While companies raced to form and bulk up their own services, trailing Netflix, rabid competition is now weighing on subscriber counts, and content costs are soaring. Although streaming remains a priority, some media CEOs are rethinking how much content to take away from the traditional bundle and put on streaming. 

    The bundle is dead

    For some in traditional media, however, YouTube becoming the home of “Sunday Ticket” wasn’t welcome news. 

    For pay-TV operators, this could lead to more customers cutting their traditional bundles and replacing them with YouTube TV, said people close to the distributors. 

    In the third quarter, cord-cutting hit all-time worst levels, according to research firm MoffettNathanson. 

    “The linear model won’t die of old age, it will instead die of neglect,” analyst Craig Moffett said in a recent note. “If lynchpin content – read: marquee sports programming – is exclusively available on linear platforms, then the linear model will be preserved, at least for a time, and at least for a segment.” 

    Driving customers toward YouTube TV subscriptions, or simply a la carte options, only amplifies the bleeding of pay-TV customers from traditional cable and telecommunications operators, like Charter Communications, Comcast and Dish. Executives on that side of the industry had hoped for Apple to win “Sunday Ticket” rights, people close to some distributors said, as it wouldn’t provide another linear bundle option.

    One positive for distributors is that while YouTube TV has broadcast and pay-TV networks that offer sports and NFL games, the streamer still doesn’t offer regional sports networks as part of its package. For an all-around sports fan, this still makes the traditional bundle a better bet. 

    Still, that could change. This week, Sinclair’s regional sports networks signed a deal with Fubo TV, putting its portfolio of networks on a digital pay-TV bundle. Such a deal with YouTube TV may not be far behind given the recent “Sunday Ticket” package. 

    Disclosure: Comcast is the parent company of NBCUniversal and CNBC.

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  • Stocks making the biggest moves midday: Mission Produce, Nutanix, Alphabet, Tesla and more

    Stocks making the biggest moves midday: Mission Produce, Nutanix, Alphabet, Tesla and more

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    A Tesla service and sales center is shown in Vista, California, June 3, 2022.

    Mike Blake | Reuters

    Check out the companies making headlines in midday trading Friday.

    Energy — Energy stocks outperformed on the S&P 500 following a rise in oil prices, which jumped Friday on expectations of a drop in Russian crude supply. Shares of Halliburton, Devon Energy, Chevron and Marathon Oil rose by more than 2% each.

    Alphabet — The tech stock gained more than 1% after The National Football League said Thursday that its “Sunday Ticket” subscription package will go to subsidiary YouTube starting next season.

    Biogen — The biotech stock declined fell slightly after Biogen’s Japanese partner, Eisai, said a third person has died during a trial of their experimental Alzheimer’s treatment, confirming Reuters reports.

    Carnival, Norwegian Cruise Line — Cruise line operators declined as fears of a recession weighed on consumer discretionary stocks, which was one of three worst-performing sectors in the S&P 500. Shares of Carnival were down more than 4%, while Norwegian Cruise Line was down more than 2%.

    Tesla — Shares of the electric vehicle maker declined 2% after CEO Elon Musk said that he would hold off on selling any more Tesla stock for the next 18 to 24 months. Over the past year, Musk sold roughly $39 billion in shares.

    3M Company — 3M shed 1.6% after a U.S. judge barred the company from shifting liability to a subsidiary for injuries suffered by military members from allegedly defective earplugs. The judge said 3M deserved the “harshest penalty” for its “bad faith” attempts to transfer liability, Reuters reported.

    Nutanix — Shares of Nutanix fell more than 5% after Dealreporter reported that Hewlett Packard Enterprise has halted talks to acquire the cloud computing company. Hewlett Packard confirmed in a statement to CNBC that “there are currently no discussions with Nutanix.”

    Mission Produce — Shares of the avocado producer dropped more than 14% after the company reported financial results for its most recent quarter. It posted lower-than-expected profit and revenue as the rise in volume was not enough to offset a plunge in the prices of avocados.

    — CNBC’s Tanaya Macheel and Michelle Fox contributed reporting.

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  • Google tells employees more of them will be at risk for low performance ratings next year

    Google tells employees more of them will be at risk for low performance ratings next year

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    CEO of Alphabet and Google Sundar Pichai during press conference at the Chancellery in Warsaw, Poland on March 29, 2022.

    Mateusz Wlodarczyk | Nurphoto | Getty Images

    More Google employees will be at risk for low performance ratings and fewer are expected to reach high marks under a new performance review system that starts next year, according to internal communications obtained by CNBC.

    In a recent Google all-hands meeting and in a separate presentation last week, executives presented more details of its new performance review process. Under the new system, Google estimates 6% of full-time employees will fall into a low-ranking category that puts them at higher risk for corrective action, versus 2% before. Simultaneously, it will be harder to achieve high marks: Google projects 22% percent of employees will be rated with in one of the two highest categories, versus 27% before.

    As an example, in order to make the new, highest rated category, “Transformative Impact,” an employee must have “achieved the near-impossible” and contributed “more than we thought possible.”

    Earlier this year, Google announced the new process for performance reviews, known as Google Reviews and Development, or GRAD.

    But CNBC recently reported that employees have complained about procedural and technical issues with GRAD close to the year-end deadlines, making them anxious they won’t be accurately rated. The anxiety is compounded by a wave of layoffs in the tech industry. While Google has so far avoided the widespread job cuts that have hit other tech companies like Meta, employees have grown anxious if they could be next.

    In a December all-hands meeting on the topic, employees expressed frustration with executives, who have long touted transparency but are not providing direct answers to questions about headcount. Some employees believe new performance review system might be a way for the company to reduce headcount.

    Headcount has been a subject of employee concern throughout the latter part of 2022. CEO Sundar Pichai found himself on the defensive in September, as he was forced to explain the company’s changing position after years of supercharged growth. Executives said at the time that there would be small cuts, and they didn’t rule out layoffs.

    And in November, a number of employees in an all-hands meeting asked for clarification on executives’ plans around headcount, and even asked if executives mismanaged headcount when Google grew its workforce by 24% year-over-year in Q3 2022.

    As of Q3, the company employed 186,779 full-time employees. It also employs a similar amount of contractors.

    Recent documents about the GRAD also say the company will be looking at bonuses, pay and equity and expects to “spend more per capita on compensation overall.” It also states the company still plans on paying within the top 5% to 10% of market rates.

    Google did not immediately respond to a request for comment.

    ‘A lot of distress and anger’

    At the company’s most recent all-hands meeting on Dec. 8, many of the top-rated questions described stress around year-end performance reviews, according to audio of the meeting obtained by CNBC. The questions also suggested some employees don’t trust the company’s leadership is being transparent in how it handles headcount.

    “Why did Google push support check-in quotas to front line managers days before the deadline?,” one employee asked, in a question read aloud by Pichai. “I’ve been through a lot in Google in 5+ years but this is a new low.”

    “It seems like a lot of last-minute support check-ins were forced through part of Cloud in order to meet a quota, causing a lot of distress and anger,” another employee asked. “With only two weeks to correct course, how is this helpful feedback? How do we prevent this from happening in the future?”

    “The support check-in process is confusing, increasingly becoming a cause of stress and anxiety in Googlers, especially given the current economic situation and rumors around layoffs,” said another top-rated employee question.

    Earlier this month, CNBC reported employees began receiving “support check-ins” often associated with lower performance ratings in the final days leading up to year-end deadlines. They also said executives changed parts of the process in the final days.

    “I know it’s been bumpy,” Google’s chief people officer Fiona Cicconi, eventually said, briefly acknowledging the issues with GRAD in a recent all-hands meeting.

    “It’s not ideal to have support check-ins occur so late in the review cycle and we know that people need time to absorb the feedback and take action on it,” admitted Cicconi, adding that “Googlers should have plenty of time to course-correct.”

    Several employees also asked executives whether they had quotas for placing people in lower performance categories in order to reduce headcount in 2023. Even though executives said they don’t have quotas, it didn’t seem to convince employees.

    One question asked executives if Google was becoming “a stack-ranking company like Amazon,” referring to the process of using quotas to place employees in certain performance buckets. 

    “Uncertainties around GRAD processes have been putting a lot of pressure on lower level managers to pass down information” about performance reviews and sometimes force “conflicting items,” another highly-rated question stated.

    Another read: “Layoffs across the industry has been a topic impacting Googlers, raising stress, anxiety and burnout,” another read. There’s been no official comms on this, which raises even more concern around this. When will the company address this topic?” 

    But executives largely avoided answering the questions directly. CEO Sundar Pichai kept saying he “doesn’t know what the future holds.”

    “What we’ve been trying hard to do is we are trying to  prioritize where we can so we are set up to better weather the storm, regardless of what’s ahead,” Pichai said. “We really don’t know what the future holds so unfortunately I cannot make forward looking commitments but everything we’ve been planning on as a company for the past six to seven months has been do all the hard work to try and work our way through this as best as possible so, that’s all I can say.”

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  • Jim Cramer’s Investing Club meeting Wednesday: Santa Claus rally, down-and-out buys, Starbucks call, Sunday Ticket

    Jim Cramer’s Investing Club meeting Wednesday: Santa Claus rally, down-and-out buys, Starbucks call, Sunday Ticket

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  • Google vs. ChatGPT: Here’s what happened when I swapped services for a day

    Google vs. ChatGPT: Here’s what happened when I swapped services for a day

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    OpenAI logo seen on screen with ChatGPT website displayed on mobile seen in this illustration in Brussels, Belgium, on December 12, 2022.

    Jonathan Raa | Nurphoto | Getty Images

    You may have heard the recent buzz around ChatGPT, an artificial intelligence chatbot that was released to the public at the end of November. I’ve read about people using the service to write their school essays and I was curious as to how it could help me in my daily life.

    The technology was developed by OpenAI, a research company backed by Microsoft and others. ChatGPT automatically generates text based on written prompts in an advanced and creative way. It can even carry out a conversation that feels pretty close to one you’d have with a human being.

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    This got me wondering — is ChatGPT smart enough to change how we find information online? Could it someday replace Google and other search engines?

    Some Google employees are certainly worried about the possibility, At a company all-hands last week, CNBC’s Jen Elias reported, employees recently asked execs if an AI-chatbot like ChatGPT was a “missed opportunity” for the company.

    Alphabet CEO Sundar Pichai and Jeff Dean, the long-time head of Google’s AI division, responded by saying that the company has similar capabilities, but that the cost if something goes wrong would be greater because people have to trust the answers they get from Google.

    Morgan Stanley published a report on the topic on Monday, Dec. 12 examining whether ChatGPT is a threat to Google. Brian Nowak, the bank’s lead analyst on Alphabet, wrote that language models could take market share “and disrupt Google’s position as the entry point for people on the Internet.”

    However, Nowak said the firm is still confident in Google’s position because the company is continuing to improve search, and creating behavioral change is a huge hurdle — a lot of internet users use Google as a habit. Additionally, Google is “building similar natural language models such as LaMDA” which could find their way into new products.

    For now, OpenAI’s creators are cautious about making any big claims. Generally speaking, the more users employ ChatGPT, the better it gets. But it still has a lot to learn. OpenAI CEO Sam Altman said in a tweet on Dec. 10 that ChatGPT is “incredibly limited” and “it’s a mistake to be relying on it for anything important right now.”

    Either way, I wanted to see how well the chatbot would work as an alternative to Google’s search engine. Instead of Googling my questions throughout the day, I asked ChatGPT.

    Here are some of the questions I asked and how ChatGPT responded compared with Google.

    ChatGPT vs. Google

    It’s easy to sign up for ChatGPT — all you need is an email address. Once you’ve registered, the webpage is very simple to navigate. There’s an area where your results will populate and a text box where you’ll type your inquiries. OpenAI says to put in a statement for the best possible result.

    I recently purchased my second Fiddle Leaf Fern plant for my apartment because the first one died. Now the new one is dying after just a few days. I normally would have asked Google what to do.

    Instead, I asked ChatGPT. “How can I keep my Fiddle Leaf Fern plant alive?”

    The results lined up with the instructions I received from the plant company, Easy Plant, which is where I bought the new Fiddle Leaf Fern. I also liked that I didn’t have to go to various different websites like I would have if I’d Googled this question.

    When I Googled the same question, the top result gave me detailed instructions in an article that included pop-up ads and a way more information than I needed, like links to buy new soil.

    Winner: ChatGPT.

    Next, I tried something where more shopping links would actually have been beneficial. I am still trying to find a present for all 8 nights of Hanukkah for my husband, so I decided to ask ChatGPT for some ideas.

    I didn’t give it any information about my husband, besides the fact that the gifts were for Hanukkah. The chatbot then assumed that my husband is kosher and that he’s into tech and watches. The latter isn’t wrong, but it’s not the answers I was hoping for.

    When I Googled this question I got access to hundreds of articles with different gift ideas and links to websites. For example I got ads to Lululemon and Bombas, which are both companies I’ve used to buy him gifts before. So in this case, Google used its personalized knowledge of me to find more targeted results from around the web.

    Winner: Google

    Next, I decided to ask ChatGPT a question with higher stakes.

    “Is it safe to take Benadryl while pregnant?” I am currently expecting my first child, and I know that taking Benadryl is safe in pregnancy based on information I’ve received from my doctor. Still, I wanted to see what the chatbot would say.

    I appreciated that ChatGPT gave me the correct answer, while also noting the importance of consulting a doctor before taking any medications during pregnancy.

    When I Googled the same medical question, the results were all over the place. At quick glance, one article from TheBump.com quoted a doctor saying “Generally, it’s safe to take Benadryl in the first trimester.” While other results said similar information to what I received on ChatGPT, without the explicit warning to discuss with my healthcare provider (unless clicking into a specific link).

    Winner: ChatGPT

    Could it replace me?

    One of the claims (or concerns) around ChatGPT — and artificial intelligence in general — is that it will replace human workers.

    So I decided to see if ChatGPT could write this article for me.

    The results were pretty astonishing. Here’s what the chatbot said after I told it to “write an article about whether or not ChatGPT is a good alternative to Google as a search engine.”

    As a large language model trained by OpenAI, I am not capable of conducting research or browsing the internet to gather information on ChatGPT or other search engines. I am only able to provide information based on what I have been trained on, which is limited to the knowledge that was available up until my training cutoff date of 2021.

    With that being said, it is worth considering the potential advantages and disadvantages of using ChatGPT as a search engine compared to other options, such as Google. One potential advantage of using ChatGPT as a search engine is that it is able to provide more personalized and conversational results.

    Because ChatGPT is a language model, it is able to understand and respond to natural language queries, allowing users to ask questions and receive answers in a more intuitive and human-like way. This can make the search experience more engaging and interactive, and may be especially useful for users who have specific or complex information needs.

    On the other hand, there are also potential limitations to using ChatGPT as a search engine. Because it is a large language model and not a traditional search engine, ChatGPT may not have access to the same breadth and depth of information as other search engines. This means that it may not be able to provide as comprehensive or up-to-date results, and may not be as effective for certain types of searches, such as those that require a large amount of data or real-time information.

    In conclusion, whether or not ChatGPT is a good alternative to Google as a search engine will depend on the specific needs and preferences of the user. It may be a useful option for those who value a more personalized and conversational search experience, but it may not be as comprehensive or effective for certain types of searches. Ultimately, the decision to use ChatGPT or another search engine will depend on the individual user’s needs and preferences.

    What impressed me most about ChatGPT’s response is that it was pretty subjective and explained its limitations.

    The verdict

    ChatGPT’s value really lies in its ability to explain complicated topics as if you were talking to a human, and to do simple writing tasks.

    For example, I asked ChatGPT to explain concepts like the stock market and internet to me, and the responses were as if I was talking to an expert on the matter. Unlike the case on Google, I didn’t have to filter through unnecessary results.

    I also asked it to write a letter to my landlord asking for an early end to my lease, and I’d be happy sending the results directly to my landlord, almost word for word.

    On the other hand, Google knows more about us and tailors the results to our interests and behaviors. Google also acts as a gateway to the internet, leading users to a plethora of different websites with more information than one could possibly digest. That’s helpful if you want a range of voices, or if there’s no single simple answer to your question — like if you’re looking for gift suggestions.

    Google is also great for certain types of questions where it scours the web to provide a brief but simple answer right in line. For instance, if you search “Apple stock ticker” or “Cheap flights to Aruba,” it will show you a ticker chart with up-to-the-minute price info, or a calendar with the most likely cheapest days to fly and a dialog box that connects you to multiple web sites to shop for tickets on your chosen date. ChatGPT does not scan the internet for real-time information, and has only been trained on data through 2021, so it’s totally useless on these kinds of queries.

    And sometimes, ChatGPT is strangely close yet totally wrong. My editor asked it for the lyrics to “The Ballad of Dwight Fry” by Alice Cooper. It somehow knew the song was about a man having a mental breakdown, but then returned completely invented lyrics about that subject, rather than the actual lyrics. Google nailed it.

    Google is also incredibly reliable, thanks to the company’s massive operations budget and years of expertise. ChatGPT is still in testing and goes down from time to time.

    So I’ll definitely continue using Google for most of my search queries for now. But if I’m not happy with the results, now I have a useful alternative. And if I ever need to dash off an angry letter, ChatGPT could be a huge help there.

    The Rise of ChatGPT: Game changer or gimmick?

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  • Cramer: Apple, Amazon, Microsoft and Google will fuel the next rally — but not in the usual way

    Cramer: Apple, Amazon, Microsoft and Google will fuel the next rally — but not in the usual way

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    Satya Nadella, chief executive officer of Microsoft Corp., during the company’s Ignite Spotlight event in Seoul, South Korea, on Tuesday, Nov. 15, 2022. Nadella gave a keynote speech at an event hosted by the company’s Korean unit.

    SeongJoon Cho | Bloomberg | Getty Images

    To build a fire — but not destroy the market by doing so.

    That’s the goal right now. It’s not as easy as in the famous Jack London short story (“To Build a Fire”) where, in the end, the survivors profit rather than freeze to death in their sleep. 

    In the early part of this decade, we saw the rise of Robinhood (HOOD) and the distribution of investments from the serious to the ephemeral. These days, Robinhood has the appearance of one gigantic bonfire of young people’s money. The gamification concept was real and the exodus of investors was noisy — culminating with the ridiculous self-immolation of GameStop (GME), AMC Entertainment (AMC) and the meme stocks. Those who fought this trend abandoned Twitter, hired bodyguards and tried to hide from the angry mob that was attempting to will stocks higher by savaging the sellers. No tinder from these clowns. 

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  • Bahamas attorneys file emergency motion in FTX case for access to databases with client information

    Bahamas attorneys file emergency motion in FTX case for access to databases with client information

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    John Ray, chief executive officer of FTX Cryptocurrency Derivatives Exchange, arrives at bankruptcy court in Wilmington, Delaware, US, on Tuesday, Nov. 22, 2022.

    Eric Lee | Bloomberg | Getty Images

    Attorneys in the Bahamas filed an emergency motion on Friday asking a Delaware bankruptcy judge to compel U.S. leaders of failed crypto firm FTX to give them access to databases as part of the proceedings.

    The emergency motion claims that despite “many attempts to obtain access,” FTX employees and counsel have stymied Bahamian regulators in their effort to get critical financial information located in Amazon Web Services and Google Cloud Portal databases.

    The lawyers, working on behalf of the Securities Commission of the Bahamas, said the U.S. bankruptcy proceedings will “suffer no harm or hardship if this relief is granted.” They’re seeking data on FTX international customers that is stored on AWS servers, including “wallet addresses, customer balances, deposit and withdrawal records, trades, and accounting data.” Google’s technology served as an analytics platform for FTX International’s data.

    “While the Joint Provisional Liquidators are happy to engage in dialogue with the U.S. Debtors, their refusal to promptly restore access has frustrated the ability of the Joint Provisional Liquidators to carry out their duties under Bahamian law and placed FTX Digital’s assets at risk of dissipation,” the filing read.

    FTX filed for bankruptcy protection last month after a liquidity crunch at the crypto exchange, which was intermingling assets with sister hedge fund Alameda Research. FTX founder Sam Bankman-Fried, who had an estimated net worth of $16 billion before the collapse, will appear before U.S. lawmakers next week.

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  • Google, Oracle, Amazon and Microsoft awarded Pentagon cloud deal of up to $9 billion combined

    Google, Oracle, Amazon and Microsoft awarded Pentagon cloud deal of up to $9 billion combined

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    The Pentagon building in Washington, D.C.

    Staff | AFP | Getty Images

    The Pentagon said Wednesday that Amazon, Google, Microsoft and Oracle received a cloud-computing contract that can reach as high as $9 billion total through 2028.

    The outcome of the Joint Warfighting Cloud Capability, or JWCC, effort is in line with the U.S. Defense Department’s effort to rely on multiple providers of remotely operated infrastructure technology, as opposed to relying on a single company, a strategy promoted during the Trump Administration.

    A Department of Defense spokesperson told CNBC by email that “JWCC is a multiple award procurement composed of four contracts with a shared ceiling of $9 Billion.” 

    An increasing tally of businesses have also sought to rely on more than one cloud provider. In some cases they rely on specialized capabilities on one and the majority of front-end and back-end workloads on another. At other times, they come down to cost. Having more than one cloud might make organizations more confident that they can withstand service disruptions brought on by outages.

    Originally, the Pentagon had awarded the Joint Enterprise Defense Infrastructure, or JEDI, to Microsoft in 2019. A legal battle ensued as Amazon, the top player in the cloud infrastructure market, challenged the Pentagon’s decision. Oracle challenged the Pentagon’s pick as well.

    In 2020, the Pentagon’s watchdog conducted a review and ruled that there was no evidence to conclude that the Trump Administration had intervened in the process of awarding the contract. Months later the Pentagon announced it would stick with Microsoft for the JEDI deal.

    Last year the Pentagon changed its approach, asking for bids from Amazon, Google, Microsoft and Oracle to address cloud needs. But the General Services Administration stated at the time that only Amazon and Microsoft seemed to be able to meet the Pentagon’s requirements.

    Read more about tech and crypto from CNBC Pro

    Wednesday’s result is a boon in particular for Oracle, which analysts don’t see in the top tier of companies offering cloud-based computing services. Oracle generated $900 million in cloud infrastructure revenue in the quarter that ended Aug. 31, a small fraction of the $20.5 billion total for Amazon’s cloud subsidiary, Amazon Web Services, in the third quarter.

    All four of the technology companies have won indefinite delivery, indefinite quantity, or IDIQ, contracts, meaning that they can involve an indefinite amount of services for a specific period of time.

    “The purpose of this contract is to provide the Department of Defense with enterprise-wide globally available cloud services across all security domains and classification levels, from the strategic level to the tactical edge,” the Defense Department said.

    Correction: A prior version of this story said each company was awarded a contract of up to $9 billion, but that number represents the combined total for the four.

    WATCH: Roughly 75% of our customers use multi-cloud and data centers, says VMware CEO

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