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  • Ukraine wants to join EU within two years, PM says

    Ukraine wants to join EU within two years, PM says

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    Ukrainian Prime Minister Denys Shmyhal has a tight two-year timetable for securing EU membership that is bound to dominate discussions at this week’s historic EU-Ukraine summit, the first to take place on Ukrainian soil.

    The problem? No one within the EU thinks this is realistic.

    When EU commissioners travel to Kyiv later this week ahead of Friday’s summit with Ukrainian President Volodymyr Zelenskyy and the heads of the European Commission and Council, their main task is likely to involve managing expectations.

    Shmyhal himself is imposing a tough deadline. “We have a very ambitious plan to join the European Union within the next two years,” he told POLITICO. “So we expect that this year, in 2023, we can already have this pre-entry stage of negotiations,” he said.

    This throws down a gauntlet to the EU establishment, which is trying to keep Ukrainian membership as a far more remote concept.

    French President Emmanuel Macron said last year it could be “decades” before Ukraine joins. Even EU leaders, who backed granting Ukraine candidate status at their summit last June, privately admit that the prospect of the country actually joining is quite some years away (and may be one reason they backed the idea in the first place.) After all, candidate countries like Serbia, Turkey and Montenegro have been waiting for many years, since 1999 in Ankara’s case.

    Ukraine is a conundrum for the EU. Many argue that Brussels has a particular responsibility to Kyiv. It was, after all, Ukrainians’ fury at the decision of President Viktor Yanukovych to pull out of a political and economic association agreement with the EU at Russia’s behest that triggered the Maidan uprising of 2014 and set the stage for war. As European Commission President Ursula von der Leyen put it: Ukraine is “the only country where people got shot because they wrapped themselves in a European flag.”

    Ukraine’s close allies in the EU such as Poland and the Baltic countries strongly support Kyiv’s membership push, seeing it as a democracy resisting an aggressor. Many of the EU old guard are far more wary, however, as Ukraine — a global agricultural superpower — could dilute their own powers and perks. Ukraine and Poland — with a combined population of 80 million — could team up to rival Germany as a political force in the European Council and some argue Kyiv would be an excessive drain on the EU budget.  

    Short-term deliverables

    Friday’s summit in Kyiv — the first EU meeting of its kind to take place in an active war zone — will be about striking the right balance.

    Though EU national leaders will not be in attendance, European Council officials have been busy liaising with EU member states about the final communiqué.

    Some countries are insisting the statement should not stray far from the language used at the June European Council — emphasizing that while the future of Ukraine lies within the European Union, aspirant countries need to meet specific criteria. “Expectation is quite high in Kyiv, but there is a need to fulfill all the conditions that the Commission has set out. It’s a merit-based process,” said one senior EU official.

    Ukraine is a conundrum for the EU. Many argue that Brussels has a particular responsibility to Kyiv | Sergei Supinsky/AFP via Getty Images

    Still, progress is expected when Zelenskyy meets with von der Leyen and European Council President Charles Michel.

    Shmyhal told POLITICO he hopes Ukraine can achieve a “substantial leap forward” on Friday, particularly in specific areas — an agreement on a visa-free regime for industrial goods; the suspension of customs duties on Ukrainian exports for another year; and “active progress” on joining the SEPA (Single Euro Payments Area) payments scheme and the inclusion of Ukraine into the EU’s mobile roaming area.  

    “We expect progress and acceleration on our path towards signing these agreements,” he said.

    Anti-corruption campaign

    The hot topic — and one of the central question marks over Ukraine’s EU accession — will be Ukraine’s struggle against corruption. The deputy infrastructure minister was fired and deputy foreign minister stepped down this month over scandals related to war profiteering in public contracts.

    “We need a reformed Ukraine,” said one senior EU official centrally involved in preparations for the summit. “We cannot have the same Ukraine as before the war.”

    Shmyhal insisted that the Zelenskyy government is taking corruption seriously. “We have a zero-tolerance approach to corruption,” he said, pointing to the “lightning speed” with which officials were removed this month. “Unfortunately, corruption was not born yesterday, but we are certain that we will uproot corruption,” he said, openly saying that it’s key to the country’s EU accession path.

    He also said the government was poised to revise its recent legislation on the country’s Constitutional Court to meet the demands of both the European Commission and the Venice Commission, an advisory body of the Council of Europe. Changes could come as early as this week, ahead of the summit, Shmyhal said.

    Though Ukraine has announced a reform of the Constitutional Court, particularly on how judges are appointed, the Venice Commission still has concerns about the powers and composition of the advisory group of experts, the body which selects candidates for the court. The goal is to avoid political interference.

    Shmyhal said these questions will be addressed. “We are holding consultations with the European Commission to see that all issued conclusions may be incorporated into the text,” he told POLITICO.

    Nonetheless, the symbolic power of this week’s summit is expected to send a strong message to Moscow about Ukraine’s European aspirations.

    European Council President Michel used his surprise visit to Kyiv this month to reassure Ukraine that EU membership will be a reality for Ukraine, telling the Ukrainian Rada (parliament) that he dreams that one day a Ukrainian will hold his job as president of the European Council.

    “Ukraine is the EU and the EU is Ukraine,” he said. “We must spare no effort to turn this promise into reality as fast as we can.”

    The key question for Ukrainians after Friday’s meeting will be how fast the rhetoric and promises can become a reality.

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    Suzanne Lynch

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  • House Speaker McCarthy spoke with Musk about making Twitter ‘fair on all sides’

    House Speaker McCarthy spoke with Musk about making Twitter ‘fair on all sides’

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    U.S. House Republican leader Kevin McCarthy (R-CA) talks to reporters as he arrives on the first day of the new Congress at the U.S. Capitol in Washington, January 3, 2023.

    Evelyn Hockstein | Reuters

    Twitter CEO Elon Musk discussed how to make the social media site “fair on all sides” in a meeting with House Speaker Kevin McCarthy, R-Calif., the lawmaker told reporters on Friday.

    “He wants to have a level playing field” and for everybody to have a voice, McCarthy said of the meeting in remarks reported by NBC News. “He’s really defending the First Amendment. And we had a really good discussion.”

    Musk shared on Twitter Thursday evening that he had met with McCarthy and Minority Leader Hakeem Jeffries, D-N.Y., “to discuss ensuring that this platform is fair to both.” On Thursday, McCarthy only shared that Musk came to wish him a happy birthday.

    On Friday, McCarthy also confirmed that Jeffries was in the Thursday meeting and that he had not previously met Musk.

    An aide to Jeffries told The Washington Post his encounter with Musk was only coincidental and happened as Musk was leaving his meeting with McCarthy. Jeffries’ office confirmed the Washington Post anecdote to CNBC.

    McCarthy also confirmed to reporters on Friday that he had convened a meeting in his office that day with Musk and several top Republicans: Majority Leader Steve Scalise R-La., Judiciary Committee Chair Jim Jordan, R-Ohio, Oversight Committee Chair James Comer, R-Ky., and Energy and Commerce Committee Chair Cathy McMorris Rodgers, R-Wash.

    McCarthy said he wanted to “continue to have that discussion” of fairness on tech platforms with the other lawmakers as they seek to move legislation and make sure “American has an even voice,” NBC News reported.

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    WATCH: Elon Musk polls Twitter users over whether he should remain as CEO

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  • Intel’s horrible quarter revealed an inventory glut and underused factories

    Intel’s horrible quarter revealed an inventory glut and underused factories

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    Intel CEO Pat Gelsinger, with U.S. President Joe Biden (not pictured), announces the tech firm’s plan to build a $20 billion plant in Ohio, from the South Court Auditorium on the White House campus in Washington, January 21, 2022.

    Jonathan Ernst | Reuters

    Intel’s December earnings showed significant declines in the company’s sales, profit, gross margin, and outlook, both for the quarter and the full year.

    Investors hated it, sending the stock over 9% lower in extended trading, despite the fact that Intel did not cut its dividend.

    The earnings report, which was the eighth under CEO Pat Gelsinger’s leadership, shows a legendary technology company struggling with many factors outside of its control, including a deeply slumping PC market. It also highlights some of Intel’s current issues with weak demand for its current products and inefficient internal performance, and underscores how precarious the company’s financial health has become.

    “Clearly, the financials aren’t what we would hoped,” Gelsinger told analysts.

    In short: Intel had a difficult 2022, and 2023 is shaping up to be tough as well.

    Here are some of the most concerning bits from Intel’s earnings report and analyst call:

    Weak and uncertain guidance

    Intel didn’t give full-year guidance for 2023, citing economic uncertainty.

    But the data points for the current quarter suggest tough times. Intel guided for about $11 billion in sales in the March quarter, which would be a 40% year-over-year decline. Gross margin will be 34.1%, a huge decrease from the 55.2% in the same quarter in 2021, Gelsinger’s first at the helm.

    Read more about tech and crypto from CNBC Pro

    But the biggest issue for investors is that Intel guided to a 15 cent non-GAAP loss per share, a big decline for a company that a year ago was reporting $1.13 in profit per share. It would be the first loss per share since last summer, which was the first loss for the company in decades.

    An inventory glut

    Dropoff in gross margin

    Underpinning all of this is that Intel’s gross margin continues to decline, hurting the company’s profitability. One issue is “factory load,” or how efficiently factories run around the clock. Intel said that its gross margin would be hit by 400 basis points, or 4 percentage points, because of factories running under load because of soft demand.

    Ultimately, Intel forecasts a 34.1% gross margin in the current quarter — a far cry from the 51% to 53% goal the company set at last year’s investor day. The company says it’s working on it, and the margin could get back to Intel’s goal “in the medium-term” if demand recovers.

    “We have a number of initiatives under way to improve gross margins and we’re well under way. When you look at the $3 billion reduction [in costs] that we talked about for 2023, 1 billion of that is in cost of sales and we’re well on our way to getting that billion dollars,” Gelsinger said.

    The not-so-bad news: Dividend and self-driving

    Long-term investors have always closely watched how the company balances the near-term need to placate shareholders with the massive capital spending needed to stay competitive in the semiconductor manufacturing business.

    If Intel is cutting costs and still needing to invest in chip factories to power its turnaround, analysts say it may want to reconsider its dividend. Intel spent $6 billion on dividends in 2022, but did not cut its dividend on Thursday.

    Meanwhile, the company said it wants to cut $3 billion in costs for 2023 and analysts believe it wants to spend around $20 billion in capital expenditures to build out its factories.

    Read more about electric vehicles from CNBC Pro

    Gelsinger was asked about this dynamic on Thursday.

    “I’d just say the board, management, we take a very disciplined approach to the capital allocation strategy and we’re going to remain committed to being very prudent around how we allocate capital for the owners and we are committed to maintaining a competitive dividend,” Gelsinger replied.

    There was at least one bright spot for Intel on Thursday.

    Mobileye, its self-driving subsidiary that went public during the December quarter, reported earlier in the day, showing adjusted earnings per share of 27 cents and revenue growth of 59%, to $656 million. It also forecast strong 2023 revenue of between $2.19 billion and $2.28 billion. Shares rose nearly 6% during regular trading hours Thursday.

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  • KeyStar Corp. Board of Directors Appoints Mark Thomas as New Chief Executive Officer

    KeyStar Corp. Board of Directors Appoints Mark Thomas as New Chief Executive Officer

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    Company to take a more focused approach towards B2C sports betting.

    Press Release



    updated: Jan 20, 2023 07:00 EST

    KeyStar Corp.® (OTC: KEYR) has announced the appointment of Mark Thomas as its new Chief Executive Officer, effective Jan. 10, 2023. Thomas was previously the Co-Founder & CEO of ZenSports, Inc. prior to its acquisition by KeyStar Corp. in 2022. Thomas succeeds John Linss as CEO, who has stepped down from the position.

    “We thank John Linss for his service to KeyStar Corp., including his work on finalizing the acquisition of ZenSports,” said Bruce Cassidy, Chairman of the Board. “The Board has decided to take an approach of focusing the company solely on B2C sports betting for the foreseeable future, and Mark Thomas is the perfect fit to lead these initiatives given his prior experience with ZenSports.”

    Under Mark’s leadership as the Co-Founder & CEO of ZenSports, the company developed a mobile gaming platform that offers a traditional sports book, peer-to-peer sports betting, and wagering in fiat and cryptocurrencies. He led the product vision and strategy, recruited the entire team across all functional areas, and raised $10M+ in venture capital funding.

    As part of the Board mandate to have a focused approach on just B2C sports betting, Thomas will be responsible for ensuring that ZenSports is able to successfully enter and grow within the U.S .market.

    “Mark has done a great job previously with ZenSports, growing the business in the European market and obtaining a Nevada gaming license in 2021,” said Cassidy. “We have full faith and confidence that he will be able to do the same under KeyStar moving forward.”

    “I am thrilled and honored that the Board has asked me to lead KeyStar Corp. as its new CEO,” said Thomas. “The ZenSports platform is an innovative brand that is leading the future of sports betting, and we have the right team and product in place to grab a significant share of the U.S. sports betting market in the coming years.”

    Bruce Cassidy remains on as the Chairman of the Board. 

    Mark Thomas Biography

    Mr. Thomas joined KeyStar Corp. as its Chief Product Officer as part of the company’s acquisition of ZenSports, Inc. in June 2022. Mr. Thomas co-founded and was the Chief Executive Officer of ZenSports since August 2016. Under his leadership, ZenSports developed a mobile gaming platform that offers a traditional sports book, peer-to-peer sports betting, and wagering in fiat and cryptocurrencies. He led the product vision and strategy, recruited the entire team across all functional areas, and raised $10M+ in venture capital funding. Prior to co-founding ZenSports, Mr. Thomas was the Chief Executive Officer of Reesio, a venture-backed real estate software platform he co-founded in 2012. Reesio automated the paperwork and manual processes that went into buying and selling a home for real estate professionals and their clients. Reesio was acquired by News Corp’s Realtor.com in 2015. Mr. Thomas began his career working in corporate finance and accounting for companies such as McKesson, Gap, Inc. and Carl Zeiss Vision before founding his first company in 2005, an executive recruiting agency in San Francisco that worked with Fortune 500 clients, including Coca-Cola, Expedia, and McKesson. Mr. Thomas sold the recruiting agency in 2008 and transitioned into working in tech, co-founding two startups within the Human Resources and Recruiting industry. Mr. Thomas also spent time working at Intuit as a Senior Product Manager, which he left in 2012 to co-found Reesio.

    Forward-Looking Statements

    This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “seek,” “believe,” “estimate,” “expect,” “strategy,” “likely,” “may,” “should” and similar references to future events or periods. 

    Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.

    Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

    Source: KeyStar Corp.

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  • Twitter is auctioning off espresso machines and kegerators from its San Francisco headquarters

    Twitter is auctioning off espresso machines and kegerators from its San Francisco headquarters

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    Elon Musk Twitter page seen on mobile with his poll to step down as head of Twitter

    Jonathan Raa | Nurphoto | Getty Images

     

    Twitter is auctioning off espresso machines, kegerators, computers, and even oversized neon displays with the company’s logo as the social messaging service reportedly has fallen behind on office rent payments.

    Interested buyers can peruse an assortment of goods that Twitter wishes to sell via the website of Heritage Global Partners, which is conducting the auction.

    Among the numerous kitchen supplies that Twitter is selling includes a rotisserie cooker, multiple refrigerators and pizza ovens. Some of the office equipment include numerous televisions, desks, and conferencing gear.

    The company is even selling a neon electrical sign that prominently displays the company’s corporate bird logo. As of Monday afternoon, someone has placed a bid of $17,500 for the neon sign.

    The gear comes from the company’s San Francisco office and appears to be another sign that new owner Elon Musk is looking to slash costs amid numerous financial difficulties, as several companies have halted their advertising campaigns on Twitter.

    Multiple civil rights groups have urged businesses to stop advertising on Twitter over allegations that the company is failing to prevent the spread of hate speech and other offensive content on its platform.

    Musk himself has alluded to the company’s dire financial straits, although in late December he reportedly said it’s no longer in the “fast lane” to bankruptcy. In December, The New York Times reported that Twitter had stopped paying for rent in all of the company’s office space.

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  • Apple CEO Tim Cook requests and receives a 40% pay cut after shareholder vote

    Apple CEO Tim Cook requests and receives a 40% pay cut after shareholder vote

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    Tim Cook, chief executive officer of Apple Inc., speaks during a “First Tool-In” ceremony at the TSMC facility under construction in Phoenix, Arizona, on Tuesday, Dec. 6, 2022.

    Caitlin O’Hara | Bloomberg | Getty Images

    Apple CEO Tim Cook will receive a pay cut in 2023 to $49 million in total compensation, the company said in a filing with the SEC.

    Cook requested the change, Apple said in the filing, following a shareholder vote on his pay package. The company also reduced the number of restricted stock units Cook would receive if he retires before 2026.

    In 2022, Cook made just under $83 million in stock awards, $12 million in incentives and $3 million in salary. He also got benefits including retirement plan contributions, security, personal air travel and more than $46,000 in vacation cash-out.

    Apple’s compensation committee said it made the change in response to last year’s say-on-pay vote, in which 64% of shareholders approved of Cook’s compensation, down from 95% who approved it for Apple’s 2020 fiscal year.

    Still, Apple’s board praised Cook’s performance, and said it has confidence in the CEO’s long-term strategic decisions.

    Executive compensation has come under increasing pressure from institutional shareholders of late. Institutional Shareholder Services recommended that Apple shareholders vote against Cook’s pay package at last year’s annual meeting.

    The compensation committee, comprised of Art Levinson, Al Gore and Andrea Jung, said it reached out to institutional shareholders to gauge how they felt about Cook’s pay.

    “Based on these important conversations, we have made changes to the size and structure of Tim’s 2023 compensation,” the committee wrote.

    More alterations could be in store.

    “Taking into consideration Apple’s comparative size, scope, and performance, the Compensation Committee also intends to position Mr. Cook’s annual target compensation between the 80th and 90th percentiles relative to our primary peer group for future years,” the committee said.

    Cook is paid mostly in restricted stock units. The number of actual shares of Apple stock that Cook vests depends on the company’s performance versus the S&P 500. Apple’s stock has done well enough that Cook typically vests the maximum amount.

    Since Cook took over as CEO in 2011, Apple stock has returned 1,212% versus 290% for the S&P 500, Apple said.

    In addition to reducing the total target, 75% of Cook’s vesting shares will be tied to Apple’s stock performance in 2023, instead of 50%.

    Apple announced a stock grant for Cook in September 2020 running through 2025. Cook received it on the first day of Apple’s fiscal 2021, which started at the end of September. When it was approved, Cook’s stock grant would have given him 1 million shares worth about $114 million at the time if Apple were to hit all its targets.

    Cook’s previous stock grant from 2011 ended up being worth more than $900 million at Apple’s September 2020 share price.

    Cook said in 2015 that he plans to donate his fortune to charity.

    WATCH: Apple sees slowing growth in app store performance

    Apple sees slowing growth in app store performance

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  • Apple’s App Store growth is slowing down

    Apple’s App Store growth is slowing down

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    Tim Cook at WWDC21 on June 7th, 2021.

    Source: Apple

    Every January, Apple releases the total amount of money that App Store developers have earned since 2008, a data point that allows analysts and Apple investors to get an idea of how much money the App Store makes.

    This year’s disclosure suggests that Apple’s App Store growth has plateaued.

    On Tuesday, Apple said it has paid $320 billion to developers, up from $260 billion as of last year, a jump of $60 billion. Developers receive between 70% and 85% of gross sales, depending on if they qualify for Apple’s reduced rate.

    If all developers paid a 30% cut to Apple, Apple’s App Store grossed more than $85 billion in 2022, based on a CNBC analysis. If Apple’s commissions were all 15%, the App Store’s estimated gross would come in lower, around $70 billion.

    It’s the same amount of sales as Apple suggested with its data point last year, when the company said it had paid developers $60 billion in 2021.

    This is a rough estimation that could vary because it’s unclear how many developers pay the lower 15% cut, versus the 30% cut, and because the stats Apple shares are rounded.

    Attempts to extrapolate the size of the App Store business from developer earnings are inaccurate, Apple said, because the commission ranges from 15% to 30%, and the vast majority of developers pay the lower commission under the App Store Small Business Program that gives a lower cut to app makers who gross under $1 million per year.

    Apple said in its release that 2022 was a “record” year for the App Store, and revealed 900 million subscriptions, up from 745 million subscriptions in 2021. Apple’s stat includes anyone who subscribes to a service through Apple’s App store, not just its own first-party services like Apple TV+ and Music.

    Read more about tech and crypto from CNBC Pro

    But Tuesday’s data point underscores that App Store growth slowed last year, which is important for investors because the App Store is a major part of Apple’s services business, and is a profit engine for the company.

    Apple’s services business grew in fiscal 2022 to $78.1 billion, a 14% increase. But that was a significant slowdown from the 27% growth rate the division posted in fiscal 2021.

    Apple is dealing with tough comparisons to elevated 2021 and 2020 app use and sales as people bought games and software while riding out the Covid pandemic. Apple is also facing consumer uncertainty around the world as interest rates rise and economists worry about a possible recession.

    Morgan Stanley analyst Erik Woodring has been following slowing App Store growth. App Store net revenue decreased for six straight months from June to November, according to his data, before growing again in December.

    Woodring wrote in a note this month that app sales will grow in 2023 because the year-over-year comparisons will be easier and as some app price increases in international markets late last year will start to benefit Apple.

    “While App Store growth remains near its lowest levels in history, and we acknowledge the global consumer remains challenged, we are encouraged to see growth trajectory continue to improve after bottoming in September,” Woodring wrote.

    Correction: Apple said in its release that 2022 was a “record” year for the App Store, and revealed 900 million subscriptions, up from 745 million subscriptions in 2021. An earlier version misstated a year.

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  • Apple valued below $2 trillion for the first time in more than 21 months as stock slides

    Apple valued below $2 trillion for the first time in more than 21 months as stock slides

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    Apple Inc. finished Tuesday with a valuation below $2 trillion for the first time in more than 21 months amid a continued slide in its stock that reflects concerns about the impact of production issues and the sustainability of consumer demand.

    The smartphone giant was valued at $1.990 trillion as of the end of Tuesday trading. Prior to that, Apple hadn’t closed with a valuation south of $2 trillion since March 8, 2021, according to Dow Jones Market Data, and its stock price hasn’t implied an intraday valuation below that level since March 30, 2021.

    The slide in Apple shares
    AAPL,
    -3.74%

    over the past year has shaved $996.5 billion from the company’s peak closing market capitalization.

    The smartphone giant peaked with a closing valuation of $2.986 trillion exactly a year ago, on Jan. 3, 2022. More recently, the company has been dogged by questions about the impact of manufacturing issues in China, where COVID-19 curbs forced production disruptions late last year.

    While the company is typically thought to have durable demand on the assumption that customers will delay purchases or put up with long delivery times in order to obtain desired Apple products, some analysts have questioned whether Apple will be able to make up for all of its lost demand in future quarters.

    A Nikkei Asia report from earlier this week hinted at demand challenges. The report, which cited anonymous sources, said that Apple has told some of its suppliers to make fewer components for AirPods, Apple Watches and MacBook computers in the first quarter.

    Apple didn’t respond to a MarketWatch request for comment.

    Apple’s stock was the biggest loser in the Dow Jones Industrial Average
    DJIA,
    -0.03%

    Tuesday.

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  • 1 dead, 9 hurt in Alabama shooting near New Year’s Eve party

    1 dead, 9 hurt in Alabama shooting near New Year’s Eve party

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    MOBILE, Ala. — One person was killed and nine hurt in a shooting a few blocks away from where thousands were in the streets for a New Year’s Eve party in downtown Mobile, Alabama, police said.

    TV news footage showed police officers running and on horseback rushing to the area where the shooting took place about 45 minutes before midnight Saturday.

    Neither the name of the person killed nor the conditions of the nine people taken to the hospital have been released by police.

    The shooting happened a few blocks away from the main stage for the Moon Pie Over Mobile festival. The event continued on with fireworks and a moon pie dropping from a downtown building at midnight to mark the start of 2023,

    The shooter and the person killed appeared to know each other, Mobile Police Chief Paul Prine told reporters near the scene.

    “It would give some comfort to all of us downtown that this was not just a random shooting,” Prine said.

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  • Weird Facts

    Weird Facts

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    A woman in France accidentally received a phone bill of €11,721,000,000,000,000 (million billion). This was 5000x the GDP of France at the time. It took several days of wrangling before the phone company finally admitted it was a mistake and she owed just €117.21. They let her off.

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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

    Lawmakers grill TikTok, YouTube, Snap executives

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  • Jack Dorsey admits mistakes at Twitter, and says the site still has problems

    Jack Dorsey admits mistakes at Twitter, and says the site still has problems

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    Twitter CEO Jack Dorsey addresses students during a town hall at the Indian Institute of Technology (IIT) in New Delhi, India, November 12, 2018.

    Anushree Fadnavis | Reuters

    Twitter co-founder and CEO Jack Dorsey didn’t mention Elon Musk by name. But in a blog post on Tuesday, he made it clear that the company he once led still had significant problems then and now.

    Dorsey said he was adding his voice to discussion around the “Twitter Files,” which Musk started releasing last week to support his claims that prior management was biased against conservatives in its handling of content moderation.

    At the beginning of his post, Dorsey said he’s come to believe in three principles. Social media must withstand “corporate and government control,” the author is the only person who can remove content they produce, and “moderation is best implemented by algorithmic choice.”

    “The Twitter when I led it and the Twitter of today do not meet any of these principles,” Dorsey wrote.

    Musk, who closed his $44 billion acquisition of Twitter in October, has rolled back many of the old moderation policies. He’s also welcomed back former President Donald Trump, who was permanently kicked off the site under Dorsey’s leadership after the Jan. 6 attack on the U.S. Capitol.

    Dorsey didn’t level any specific criticism at Musk. He said he personally abandoned his efforts to push the company in the right direction after activist firm Elliott Management got involved with the company over two years ago.

    “This is my fault alone,” Dorsey wrote. “I completely gave up pushing for them when an activist entered our stock in 2020.”

    Regarding Twitter’s decision to suspend Trump, Dorsey said he believes “there was no ill intent or hidden agendas, and everyone acted according to the best information we had at the time.”

    Still, he said that “mistakes were made” and Twitter would be in a better position today if the company “focused more on tools for the people using the service rather than tools for us.”

    Dorsey said that in general social messaging platforms shouldn’t take down content or suspend accounts, because “doing so complicates important context, learning, and enforcement of illegal activity.”

    He promoted the idea of a “free and open protocol for social media” that isn’t owned by any one person or company as the only way to adhere to his stated principles.

    “The problem today is that we have companies who own both the protocol and discovery of content,” Dorsey wrote. “Which ultimately puts one person in charge of what’s available and seen, or not.”

    Dorsey cited Bluesky, a nonprofit organized by Twitter, as well as Mastodon and Matrix as emerging projects that could potentially live up to his view of what constitutes a free and open social media protocol. He said he would be offering grants to promising projects, starting with $1 million to Signal, an encrypted messaging app.

    WATCH: Twitter is the modern public square and should not censor journalists

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  • Apple announces plans to encrypt iCloud backups

    Apple announces plans to encrypt iCloud backups

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    CUPERTINO, CALIFORNIA – JUNE 06: Apple CEO Tim Cook looks at a display of brand new redesigned MacBook Air laptop during the WWDC22 at Apple Park on June 06, 2022 in Cupertino, California. Apple CEO Tim Cook kicked off the annual WWDC22 developer conference. (Photo by Justin Sullivan/Getty Images)

    Justin Sullivan | Getty Images News | Getty Images

    Apple announced on Wednesday that it plans to allow users to encrypt additional kinds of iCloud data on its servers, including full backups, photos and notes.

    The feature, called Advanced Data Protection, will prevent Apple from seeing the contents of some of the most sensitive user data stored on its servers, and will make it impossible for Apple to provide the content of an encrypted backup to law enforcement.

    Encrypted backups will be opt-in, according to Apple, and will be available in the U.S. before the end of the year.

    While Apple has previously encrypted a lot of data it stores on servers, entire device backups that included text messages, contacts, and other important data were not end-to-end encrypted, and Apple previously had access to the contents of the backups.

    The move will please security advocates, many of whom previously pointed to unencrypted iCloud backups as a weak link in Apple’s privacy policy. It also means that user data content would not be exposed if Apple’s servers were ever breached.

    It could upset law enforcement, which has used Apple’s policy of not encrypting backups as a way to obtain materials in investigations even though Apple’s iMessage and devices are encrypted.

    Apple famously fought the FBI’s attempt to force it through the courts to unlock an encrypted iPhone used by a terrorist in San Bernardino. At the time, Apple said that an unencrypted iCloud backup on its servers was an option to get the same data.

    Law enforcement officials around the world generally oppose encryption because it allows suspects to “go dark,” and denies law enforcement access to potential evidence they could previously access under lower levels of security.

    Apple also announced two other security features on Wednesday. Users will soon be able to use a physical key as second-factor protection for Apple ID logins. Another update allows users facing significant security threats to confirm that text messages aren’t being intercepted.

    Last year, in an apparent effort to appease law enforcement, Apple announced a system to scan for illegal content such as child sexual abuse materials using a complicated system that would still allow Apple to encrypt user photos on its servers. The system was opposed by privacy advocates who said that it would essentially allow Apple to scan people’s hard drives.

    The development of the system has been stopped, according to the Wall Street Journal.

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  • Apple Makes Plans to Move Production Out of China

    Apple Makes Plans to Move Production Out of China

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    In recent weeks, Apple Inc. has accelerated plans to shift some of its production outside China, long the dominant country in the supply chain that built the world’s most valuable company, say people involved in the discussions. It is telling suppliers to plan more actively for assembling Apple products elsewhere in Asia, particularly India and Vietnam, they say, and looking to reduce dependence on Taiwanese assemblers led by Foxconn Technology Group. 

    Turmoil at a place called iPhone City helped propel Apple’s shift. At the giant city-within-a-city in Zhengzhou, China, as many as 300,000 workers work at a factory run by Foxconn to make iPhones and other Apple products. At one point, it alone made about 85% of the Pro lineup of iPhones, according to market-research firm Counterpoint Research. 

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  • Elon Musk meets Tim Cook, says Apple never considered removing Twitter app

    Elon Musk meets Tim Cook, says Apple never considered removing Twitter app

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    An aerial view of Apple Park is seen in Cupertino, California, United States on October 28, 2021.

    Tayfun Coskun | Anadolu Agency | Getty Images

    Twitter owner Elon Musk said he went to Apple’s headquarters and met with Apple CEO Tim Cook in tweets on Wednesday.

    The meeting marks a significant de-escalation days after Musk went on a tweet storm accusing Apple of threatening to pull the Twitter app from the App Store and posted then deleted a meme that suggested he would rather “go to war” than pay Apple’s 30% platform fees.

    “Good conversation. Among other things, we resolved the misunderstanding about Twitter potentially being removed from the App Store,” Musk tweeted. “Tim was clear that Apple never considered doing so.”

    In another tweet, Musk posted a short video of a reflecting pool at the center of Apple Park in Cupertino, California.

    On Monday, Musk posted several tweets criticizing Apple and arguing that its App Store moderation policies were against the spirit of free speech, a complaint subsequently echoed by Republican lawmakers. Over the weekend, he mused that he may make his own smartphone.

    Musk also chafed against Apple’s fees, which take between 15% and 30% of digital sales through apps on iPhones. Apple stands to make money from Twitter if Musk succeeds in his plan to significantly expand Twitter subscription revenue, and those features are sold through the Twitter iPhone app.

    “Did you know Apple puts a secret 30% tax on everything you buy through their App Store?” Musk tweeted on Monday. He also tagged Cook’s Twitter account on Monday and asked what was going on with a potential suspension of the Twitter app.

    Apple representatives did not respond to requests for comment.

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  • Salesforce stock falls over 5% on earnings and sudden departure of co-CEO Bret Taylor

    Salesforce stock falls over 5% on earnings and sudden departure of co-CEO Bret Taylor

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    Salesforce cofounder and co-CEO Marc Benioff speaks during the grand opening of the Salesforce Tower, the tallest building in San Francisco, Calif., Tuesday, May 22, 2018.

    Karl Mondon | Bay Area News Group | Getty Images

    Salesforce reported earnings and revenue on Wednesday that beat analyst expectations. It also announced that co-CEO Bret Taylor is stepping down. CEO and Salesforce co-founder Marc Benioff will the be sole person in charge of the company.

    Salesforce stock fell over 6% in extended trading.

    Here’s how the company did versus Refinitiv consensus estimates for the quarter ending in October:

    • EPS: $1.40, adjusted, versus $1.21 expected by analysts
    • Revenue: $7.84 billion versus $7.82 billion expected by analysts

    Salesforce said it expected between $7.9 billion to $8.03 billion in revenue in the company’s fourth fiscal quarter, lower at the midpoint than analyst expectations of $8.02 billion in sales in the fourth quarter. The company also said it would take a $900 million hit in sales because of foreign currency effects.

    Salesforce’s total revenue increased 14% year-over-year. Last quarter, Salesforce trimmed its year-end estimates for both revenue and earnings, citing a weaker economic cycle. It reaffirmed those estimates on Wednesday.

    Salesforce said that its operating cash flow came in at $313 million for the quarter, which was a decrease of 23% year-over-year.

    Subscription and support revenue, which includes the company’s flagship Sales Cloud software and comprises the majority of the company’s sales, came in at $7.23 billion, which was up 13% year-over-year.

    The Platform and Other category that includes Slack reported $1.51 billion in sales, an 18% increase year-over-year.

    Salesforce spent $1.7 billion on share repurchases during the quarter, the company said.

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  • Elon Musk says Twitter Blue relaunch delayed, may use different color checks for organizations

    Elon Musk says Twitter Blue relaunch delayed, may use different color checks for organizations

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    An image of new Twitter owner Elon Musk is seen surrounded by Twitter logos in this photo illustration in Warsaw, Poland on 08 November, 2022. 

    STR | Nurphoto | Getty Images

    Twitter owner Elon Musk said on Monday evening that the company is planning to delay the relaunch of its $8 per month Blue Verified service. Musk said Twitter will “probably use different color check for organizations than individuals.”

    Twitter Blue was launched earlier this month but was pulled after users abused the new paid option, which Musk hoped would drive new revenue to the platform. It allowed users to pay for a Blue checkmark, previously reserved for verified users.

    Musk had earlier said he planned to relaunch Twitter Blue on Nov. 29.

    The paid Blue subscription service led to a plethora of pranksters creating imposter accounts on Twitter. It left the platform even more ripe for misinformation, and many cheaply acquired checkmarks were used to impersonate brands, politicians and celebrities with unflattering messages.

    A user impersonating pharmaceutical giant Eli Lily, for example, tweeted “we are excited to announce insulin is free now.”

    Eli Lilly’s stock price dropped sharply after the false message was posted, and so did other pharmaceutical companies including AbbVie, which was also impersonated on Twitter. At that time, major stock indices were positive, amid a market rally.

    Twitter has trialed using two check marks, including a Blue one for paid and previously-verified users and a gray “Official” checkmark for some brands, such as news organizations. But there was a confusing overlap, where some accounts had both checkmarks. Musk killed the “Offical” checkmark the same day it rolled out.

    The delay comes after Musk gutted much of Twitter’s staff. About half of the company’s 7,500 employees were laid off earlier this month. Then, last week, about another 1,200 full-time employees left, according to The New York Times, after Musk demanded employees commit to working “long hours at high intensity” on his vision for “Twitter 2.0” or submit their resignations.

    — CNBC’s Lora Kolodny contributed to this report.

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  • Democratic senators urge regulators to monitor SoFi trading activity, expressing concern during crypto meltdown

    Democratic senators urge regulators to monitor SoFi trading activity, expressing concern during crypto meltdown

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    Chairman Sherrod Brown (D-OH) questions Treasury Secretary Janet Yellen and Federal Reserve Chairman Powell during a Senate Banking, Housing and Urban Affairs Committee hearing on the CARES Act, at the Hart Senate Office Building in Washington, DC, September 28, 2021.

    Kevin Dietsch | Pool | Reuters

    Four Democratic lawmakers on the Senate Banking Committee urged federal regulators to look into SoFi’s cryptocurrency trading activity in a letter on Monday, warning its “digital asset activities pose significant risks to both individual investors and safety and soundness.”

    SoFi shares were down more than 6% Monday afternoon.

    In two separate letters, one to federal officials and another to SoFi CEO Anthony Noto, the lawmakers expressed deep concerns over a lack of regulation in cryptocurrency markets.

    “Over the past year, several meltdowns in the crypto market have wiped out trillions in value, including another huge crash last week,” the letter to Noto said.

    SoFi is unique among institutions singled out for regulatory scrutiny because it operates as both a bank holding company and as a crypto exchange, through a subsidiary.

    SoFi pitches itself as a digital financial services company with 3.9 million members as of Q1 2022. SoFi began as a student loan company in 2011. Since then, the San Francisco-based, Nasdaq-traded company made its first foray into crypto through a partnership with Coinbase in 2019. But lawmakers have honed in on SoFi’s February 2022 acquisition of Golden Pacific Bancorp.

    That acquisition converted SoFi into a bank holding company and, according to lawmakers, subjected it to “consolidated supervision by the Federal Reserve.” It’s this new regulatory oversight that has prompted lawmakers’ objections to SoFi’s expanding cryptocurrency offerings.

    Bank holding companies have to conform to strict regulations on the kinds of financial products they can offer. Heightened financial and risk controls mean that SoFi’s crypto activities “pose significant risks to both individual investors and safety and soundness,” the lawmakers said.

    The lawmakers — Senate Banking Chair Sherrod Brown, D-Ohio, and fellow committee members Jack Reed, D-R.I., Chris Van Hollen D-Md., and Tina Smith D-Minn. — point to SoFi’s financial guidance as evidence. Investor education material from SoFi warns that a cryptocurrency offered on SoFi’s crypto platform, Dogecoin, has “no special use case or features.” SoFi’s literature calls it a pump-and-dump scheme.

    To offer products that the company knows are “pump-and-dumps” flies in the face of SoFi’s new obligation to “fundamental principles of investor protection and safety and soundness,” lawmakers wrote.

    In the letter to Noto, the Democrats said they are “concerned that SoFi’s continued impermissible digital asset activities demonstrate a failure to take seriously its regulatory commitments and to adhere to its obligations.” They urged leaders of the Federal Reserve System, Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency to “ensure that SoFi complies with all consumer financial protection and banking regulations.”

    “SoFi takes our regulatory and compliance commitments seriously, including our non-bank operations within the digital assets space,” a SoFi spokesperson said in a statement. “We believe we have been fully compliant with the mandates of our bank license and all applicable laws. Additionally, we maintain consistent, constructive dialogue with each of our regulators. Cryptocurrency remains a non-material component of our business. We look forward to sharing the requested information with the Senators in a timely fashion.”

    The letters to regulators and SoFi come as crypto markets weather their worst crisis yet. The implosion of cryptocurrency exchange FTX and the engagement that FTX founder Sam Bankman-Fried had with U.S. regulators, have drawn the ire of Congress and the public.

    Lawmakers have demanded an explanation from SoFi on its risk management, credit, financial and compliance systems by Dec. 8. The company has already endured tumult over potential plans to forgive student loan balances, with shares down over 24% since President Biden announced his intentions.

    Subscribe to CNBC on YouTube.

    WATCH: Ether drops 4% in a week, and Bahamas regulator confirms FTX asset seizure: CNBC Crypto World

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  • Meta laying off more than 11,000 employees: Read Zuckerberg’s letter announcing the cuts

    Meta laying off more than 11,000 employees: Read Zuckerberg’s letter announcing the cuts

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    Meta is laying off 13% of its staff, or more than 11,000 employees, CEO Mark Zuckerberg said in a letter to employees Wednesday.

    “Today I’m sharing some of the most difficult changes we’ve made in Meta’s history,” Zuckerberg said in the letter. “I’ve decided to reduce the size of our team by about 13% and let more than 11,000 of our talented employees go. We are also taking a number of additional steps to become a leaner and more efficient company by cutting discretionary spending and extending our hiring freeze through Q1.”

    Shares of Meta were up about 4% in premarket trading.

    The layoffs come amid a tough time for Facebook parent company Meta, which provided lukewarm guidance in late October for its upcoming fourth-quarter earnings that spooked investors and caused its shares to sink nearly 20%.

    Investors have been concerned about Meta’s rising costs and expenses, which jumped 19% year over year in the third quarter to $22.1 billion. The company’s overall sales declined 4% to $27.71 billion in the quarter while its operating income dropped 46% from the previous year to $5.66 billion.

    “I want to take accountability for these decisions and for how we got here. I know this is tough for everyone, and I’m especially sorry to those impacted.” Zuckerberg said.

    He said Meta is making reductions in every organization but that recruiting will be disproportionately affected since the company plans to hire fewer people in 2023. The company extended its hiring freeze through the first quarter with a few exceptions, Zuckerberg said.

    “This is a sad moment, and there’s no way around that. To those who are leaving, I want to thank you again for everything you’ve put into this place,” he added.

    Impacted employees will receive 16 weeks of pay plus two additional weeks for every year of service, Zuckerberg said. Meta will cover health insurance for six months.

    Meta is heavily investing in the metaverse, which generally refers to a yet-to-be developed digital world that can be accessed by virtual reality and augmented reality headsets. This hefty bet has cost Meta $9.4 billion so far in 2022, and the company anticipates that losses “will grow significantly year-over-year.”

    Zuckerberg said during a call with analysts as part of its third-quarter earnings report that Meta plans to “focus our investments on a small number of high priority growth areas” during the next year.

    “That means some teams will grow meaningfully, but most other teams will stay flat or shrink over the next year,” Zuckerberg said. “In aggregate, we expect to end 2023 as either roughly the same size, or even a slightly smaller organization than we are today.”

    Meta counts more than 87,000 employees as of the end of September.

    Here’s Mark Zuckerberg’s letter to employees:

    “Today I’m sharing some of the most difficult changes we’ve made in Meta’s history. I’ve decided to reduce the size of our team by about 13% and let more than 11,000 of our talented employees go. We are also taking a number of additional steps to become a leaner and more efficient company by cutting discretionary spending and extending our hiring freeze through Q1.

    I want to take accountability for these decisions and for how we got here. I know this is tough for everyone, and I’m especially sorry to those impacted.

    How did we get here?

    At the start of Covid, the world rapidly moved online and the surge of e-commerce led to outsized revenue growth. Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I did too, so I made the decision to significantly increase our investments. Unfortunately, this did not play out the way I expected. Not only has online commerce returned to prior trends, but the macroeconomic downturn, increased competition, and ads signal loss have caused our revenue to be much lower than I’d expected. I got this wrong, and I take responsibility for that.

    In this new environment, we need to become more capital efficient. We’ve shifted more of our resources onto a smaller number of high priority growth areas — like our AI discovery engine, our ads and business platforms, and our long-term vision for the metaverse. We’ve cut costs across our business, including scaling back budgets, reducing perks, and shrinking our real estate footprint. We’re restructuring teams to increase our efficiency. But these measures alone won’t bring our expenses in line with our revenue growth, so I’ve also made the hard decision to let people go.

    How will this work?

    There is no good way to do a layoff, but we hope to get all the relevant information to you as quickly as possible and then do whatever we can to support you through this.

    Everyone will get an email soon letting you know what this layoff means for you. After that, every affected employee will have the opportunity to speak with someone to get their questions answered and join information sessions.

    Some of the details in the US include:

    • Severance. We will pay 16 weeks of base pay plus two additional weeks for every year of service, with no cap.
    • PTO. We’ll pay for all remaining PTO time.
    • RSU vesting. Everyone impacted will receive their November 15, 2022 vesting.
    • Health insurance. We’ll cover the cost of healthcare for people and their families for six months.
    • Career services. We’ll provide three months of career support with an external vendor, including early access to unpublished job leads.
    • Immigration support. I know this is especially difficult if you’re here on a visa. There’s a notice period before termination and some visa grace periods, which means everyone will have time to make plans and work through their immigration status. We have dedicated immigration specialists to help guide you based on what you and your family need. 

    Outside the US, support will be similar, and we’ll follow up soon with separate processes that take into account local employment laws.

    We made the decision to remove access to most Meta systems for people leaving today given the amount of access to sensitive information. But we’re keeping email addresses active throughout the day so everyone can say farewell.

    While we’re making reductions in every organization across both Family of Apps and Reality Labs, some teams will be affected more than others. Recruiting will be disproportionately affected since we’re planning to hire fewer people next year. We’re also restructuring our business teams more substantially. This is not a reflection of the great work these groups have done, but what we need going forward. The leaders of each group will schedule time to discuss what this means for your team over the next couple of days.

    The teammates who will be leaving us are talented and passionate, and have made an important impact on our company and community. Each of you have helped make Meta a success, and I’m grateful for it. I’m sure you’ll go on to do great work at other places.

    What other changes are we making?

    I view layoffs as a last resort, so we decided to rein in other sources of cost before letting teammates go. Overall, this will add up to a meaningful cultural shift in how we operate. For example, as we shrink our real estate footprint, we’re transitioning to desk sharing for people who already spend most of their time outside the office. We’ll roll out more cost-cutting changes like this in the coming months. 

    We’re also extending our hiring freeze through Q1 with a small number of exceptions. I’m going to watch our business performance, operational efficiency, and other macroeconomic factors to determine whether and how much we should resume hiring at that point. This will give us the ability to control our cost structure in the event of a continued economic downturn. It will also put us on a path to achieve a more efficient cost structure than we outlined to investors recently.

    I’m currently in the middle of a thorough review of our infrastructure spending. As we build our AI infrastructure, we’re focused on becoming even more efficient with our capacity. Our infrastructure will continue to be an important advantage for Meta, and I believe we can achieve this while spending less.

    Fundamentally, we’re making all these changes for two reasons: our revenue outlook is lower than we expected at the beginning of this year, and we want to make sure we’re operating efficiently across both Family of Apps and Reality Labs. 

    How do we move forward?

    This is a sad moment, and there’s no way around that. To those who are leaving, I want to thank you again for everything you’ve put into this place. We would not be where we are today without your hard work, and I’m grateful for your contributions.

    To those who are staying, I know this is a difficult time for you too. Not only are we saying goodbye to people we’ve worked closely with, but many of you also feel uncertainty about the future. I want you to know that we’re making these decisions to make sure our future is strong.

    I believe we are deeply underestimated as a company today. Billions of people use our services to connect, and our communities keep growing. Our core business is among the most profitable ever built with huge potential ahead. And we’re leading in developing the technology to define the future of social connection and the next computing platform. We do historically important work. I’m confident that if we work efficiently, we’ll come out of this downturn stronger and more resilient than ever.

    We’ll share more on how we’ll operate as a streamlined organization to achieve our priorities in the weeks ahead. For now, I’ll say one more time how thankful I am to those of you who are leaving for everything you’ve done to advance our mission.

    Mark”

    Watch: Meta has to go back to their core advertising business and double down.

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  • All eyes on China as Apple and Foxconn outline zero-COVID issues. Meanwhile, cases are rising again in the U.S.

    All eyes on China as Apple and Foxconn outline zero-COVID issues. Meanwhile, cases are rising again in the U.S.

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    China’s strict zero-COVID policy was making headlines Monday after Apple and iPhone manufacturer Foxconn said over the weekend that restrictions are crimping production and will delay shipments of the high-end iPhone 14.

    “We continue to see strong demand for iPhone 14 Pro and iPhone 14 Pro Max models,” Apple
    AAPL,
    -0.82%

    announced in a Sunday evening press release. “However, we now expect lower iPhone 14 Pro and iPhone 14 Pro Max shipments than we previously anticipated and customers will experience longer wait times to receive their new products.” 

    Also read: Will Apple’s latest production issues destroy demand?

    Foxconn, meanwhile, which trades as Hon Hai Precision Industry Co.
    2317,
    -0.50%
    ,
    lowered its fourth-quarter guidance and said anti-COVID measures were affecting some of its operations in Zhengzhou, China, as Dow Jones Newswires reported.

    Foxconn said that the Henan provincial government had made it clear that it would fully support the company. Foxconn’s most advanced iPhone plant, located in the provincial capital of Zhengzhou, has been battling a COVID outbreak.

    Foxconn said it is working with the government to halt the outbreak and resume production at full capacity as quickly as possible.

    Workers at the world’s biggest assembly site for Apple’s iPhones walked out last week as Foxconn struggled to contain a COVID-19 outbreak. The chaos highlighted the tension between Beijing’s rigid pandemic controls and the need to keep production on track. Photo: Hangpai Xinyang/Associated Press

    Investors have been closely watching China for signs that its government would start to lift the tough pandemic restrictions that have been in place for almost three years. The Wall Street Journal reported Monday that the country’s leaders are considering steps but have not yet set a timeline.

    Chinese  officials have become concerned about the costs of their zero-tolerance approach to COVID, which has resulted in lockdowns of cities and whole provinces, crushing business activity and confining hundreds of millions of people to their homes for weeks and sometimes months on end.

    But they are weighing those concerns against the potential costs of reopening on public health and on support for the Communist Party. On Saturday, officials from China’s National Health Commission again reaffirmed their commitment to a firm zero-COVID strategy, which they described as essential to “protect people’s lives.”

    Still, there are plans in Beijing to further cut the number of days incoming travelers must quarantine in hotels from 10 to seven, followed by three days of home monitoring, the paper reported, citing people involved in the discussions.

    And officials have told retail businesses that they intend to reduce the frequency of PCR testing as soon as this month, partly because of the cost.

    In the U.S., known cases of COVID and hospitalizations are climbing again for the first time in a few months.

    The daily average for new cases stood at 39,954 on Sunday, according to a New York Times tracker, up 6% compared with two weeks ago. But cases are sharply higher in several states, led by Nevada, where they are up 96% from two weeks ago, followed by Tennessee, where they are up 69%; Louisiana, where they are up 68%; Utah, where they have climbed 61%; and New Mexico, where they are up 56%.

    Cases are climbing in 30 states and in Washington, D.C.

    The daily average for hospitalizations was up 2% to 27,419, while the daily average for deaths was down 11% to 320.

    Physicians are reporting high numbers of respiratory illnesses like RSV and the flu earlier than the typical winter peak. WSJ’s Brianna Abbott explains what the early surge means for the winter months. Photo illustration: Kaitlyn Wang

    The Centers for Disease Control and Prevention said the BQ.1 and BQ.1.1 variants accounted for 35.3% of new cases in the week through Nov. 5, up from 27.1% a week ago.

    The two variants accounted for 52.3% of all cases in the New York region, which includes New Jersey, Puerto Rico and the Virgin Islands, up from 42.5% the previous week. That was more than the BA.5 omicron subvariant, which accounted for 24.9% of new cases in the New York area in the latest week.

    The BA.5 omicron subvariant accounted for 39.2% of all U.S. cases, the data show.

    BQ.1 and BQ.1.1 were still lumped in with BA.5 variant data as recently as three weeks ago, because at that time, their numbers were too small to break out. BQ.1 was first identified by researchers in early September and has been found in the U.K. and Germany, among other places. 

    Coronavirus Update: MarketWatch’s daily roundup has been curating and reporting all the latest developments every weekday since the coronavirus pandemic began

    Other COVID-19 news you should know about:

    • BioNTEch SE
    BNTX,
    +2.84%
    ,
    the German biotech that has partnered with Pfizer
    PFE,
    -0.53%

    on a COVID vaccine, posted earnings early Monday, showing a roughly 50% drop in profit that sent its stock lower, despite beating consensus estimates. The Mainz-based company said it had invoiced about 300 million doses of its bivalent vaccine, which targets the omicron variant as well as the original virus. The company chalked up €564.5 million ($563.9 million) in direct COVID vaccine sales in the quarter, down from €1.351 billion a year ago. BioNTech raised the lower end of its full-year COVID vaccine revenue range to €16 billion to €17 billion, from a previous €13 billion to €17 billion.

    • Thousands of runners took to the streets of the Chinese capital on Sunday for the return of Beijing’s annual marathon after a two-year hiatus, the Associated Press reported. However, the good news was offset by anger about another death related to COVID restrictions, this time of a 55-year-old woman in a sealed building. An investigation report released Sunday in Hohhot, the capital of China’s Inner Mongolia region, blamed property management and community staff for not acting quickly enough to prevent the death of the woman after being told she had suicidal tendencies.

    • The U.S. flu season is off to an unusually fast start, contributing to an autumn mix of viruses that have patients filling hospitals’ and physicians’ waiting rooms, the AP reported separately. Reports of flu are already high in 17 states, and the hospitalization rate hasn’t been this high this early since the 2009 swine flu pandemic, according to the Centers for Disease Control and Prevention. So far, there have been an estimated 730 flu deaths, including at least two children. The winter flu season usually ramps up in December or January.

    Here’s what the numbers say:

    The global tally of confirmed cases of COVID-19 topped 632.6 million on Monday, while the death toll rose above 6.60 million, according to data aggregated by Johns Hopkins University.

    The U.S. leads the world with 97.7 million cases and 1,072,598 fatalities.

    The Centers for Disease Control and Prevention’s tracker shows that 227.3 million people living in the U.S., equal to 68.5% of the total population, are fully vaccinated, meaning they have had their primary shots.

    So far, just 26.3 million Americans have had the updated COVID booster that targets the original virus and the omicron variants, equal to 8.4% of the overall population.

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