Business News at a Glance
Posted January 12, 2018 9:17 p.m. EST
GM Says Its Driverless Car Could Be in Fleets by Next Year
The advent of self-driving cars, the subject of so much fanfare over the last few years from automakers and technology companies, may be just around the corner — at least according to General Motors. On Friday, GM submitted a petition to the U.S. Department of Transportation seeking permission to begin operating fully autonomous cars — without steering wheels or pedals — in a commercial ride-hailing service next year. What’s more, the company said the vehicle, the Cruise AV, could be put into production on a standard assembly line once approval was granted by the federal government and states where the cars would operate.
JPMorgan’s Profits Are Strong, and Rising
JPMorgan Chase’s financial results came in slightly stronger than expected Friday, despite a hit from the new tax law, and they indicate that the bank and its peers could grow more profitable in the years ahead. JPMorgan’s results are an important bellwether for the financial industry — it’s the biggest U.S. bank by assets, and it’s the first large bank to report its quarterly and annual results. The new tax package slashed the corporate income tax rate and applied a new, lower rate to earnings that companies had been stockpiling overseas. In the short term, that resulted in some modest pain: JPMorgan took a $2.4 billion charge.
The End of the Social News Era? Journalists Brace for Facebook’s Big Change
Mark Zuckerberg, Facebook’s chief executive, said Thursday that he wanted the social network to focus on “meaningful interaction.” But his idea of what that phrase means is likely to differ from that of news industry executives and editors. Media companies are bracing for the changes coming to Facebook’s News Feed that will favor posts by friends over material from news organizations and other businesses. "Nobody knows exactly what impact it’ll have, but in a lot of ways, it looks like the end of the social news era,” Jacob Weisberg, chairman and editor-in-chief of the Slate Group, said Friday.
BlackRock: The $6 Trillion Money Manager
Continuing to cash in on the boom in exchange-traded funds, BlackRock, the world’s largest money manager, ended 2017 with $6.29 trillion under management, up 22 percent from a year ago. BlackRock reported adjusted net earnings of $3.7 billion for the year Friday, up 16 percent from 2016 and easily beating analysts’ expectations. The firm also reported a $1.2 billion tax benefit for the fourth quarter, resulting from the recent tax cut package. Including the tax benefit, earnings were up 59 percent for the year. “We have been very aggressive with fee cuts and yet our margins continue to expand,” said Laurence D. Fink, chief executive of BlackRock.
Loyal Sam’s Club Members Lament the Loss of a Trusted Friend
The conventional wisdom is that consumers do not go to brick-and-mortar stores anymore. Tell that to the shoppers at Sam’s Club. Walmart’s quiet shuttering of 63 Sam’s Club stores on Thursday — hours after trumpeting its plans to raise wages — sent shock waves through the ardent customer base of the membership-only chain. Patrons protested with unusual passion not granted to the thousands of closures recently announced by other retailers. On social media, some shoppers reminisced while others fretted about remote areas losing a primary source of supplies or a reliable place to pick up prescriptions.
Holiday Retail Sales Soared, With Biggest Increase Since Recession
Shoppers came out in force during the holidays, driven by a strengthening economy, high consumer confidence and rebuilding efforts after a season of natural disasters across the country. Retail sales during November and December increased 5.5 percent, to about $692 billion, from a year earlier, according to data released Friday by the National Retail Federation. It was the largest increase in holiday sales since the recession of 2008, exceeding the federation’s forecast of $682 billion, or growth of about 4 percent. The trade group said the strong numbers showed that the retail industry might not be as fundamentally troubled as many analysts perceived it to be.
Thiel Makes a Bid for Gawker.com, a Site He Helped Bankrupt
Peter Thiel, the technology billionaire, submitted a bid this week to purchase Gawker.com, the remaining unsold property from the Gawker Media gossip empire that was nearly destroyed in 2016 by a lawsuit largely bankrolled by Thiel. If approved, the acquisition could be the last step in a yearslong effort by Thiel to finish an independent journalism outfit that angered him in 2007 when it reported, without his permission, that he is gay, a fact widely known at the time in Silicon Valley. Gawker.com has received other offers, and it is not clear if Thiel, a co-founder of PayPal and an early investor in Facebook, will prevail.
Bezos Jumps Into Immigration Fight With Gift for Scholarships
Jeff Bezos, the founder of Amazon, on Friday injected himself into one of the most contentious political debates in the United States, announcing that he and his wife had donated $33 million to a college scholarship program geared toward young immigrants brought to the country illegally as children. Bezos and his wife, MacKenzie, gave the money to the nonprofit Dream.US. The group said the donation, the largest in its history, would finance scholarships for 1,000 high school graduates who have been allowed to stay in the United States under the Deferred Action for Childhood Arrivals program.