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Viasat revenue grows as investigation continues into malfunctioning $750 million satellite 2023-08-09 - Viasat reported a jump in quarterly revenue Wednesday, as the company continues to investigate its recent satellite malfunction and explores options to make up for some of the service it expected to add this year. The company, which reported fiscal 2024 first-quarter results, wrote in a letter to shareholders that the problem with the ViaSat-3 Americas communications satellite disclosed last month "creates unanticipated challenges that we are already addressing." "We are currently working closely with our antenna supplier to assess the status of the antenna," Viasat Chairman and CEO Mark Dankberg and President K. Guru Gowrappan wrote in the letter. Dankberg added on the company's earnings call that Viasat expects to give an update on "corrective actions" for the the satellite at the end of its second quarter. Viasat has approximately $420 million in insurance on the malfunctioning satellite, "which is nearly half of the net book value" of ViaSat-3 Americas, putting its value at about $750 million. Viasat stock rose about 3% in after-hours trading from its close at $28.20 a share. Viasat brought in $780 million in revenue during the quarter, a 36% increase compared to the same period last year. It reported a net loss of $77 million for the quarter, wider than a net loss of $21.6 million a year ago. It cited higher interest expenses, as well as costs related to its acquisition of Inmarsat. As of the end of quarter, Viasat had $5.5 billion in net debt, with about $2 billion in cash and equivalents. Viasat said it is investigating the root cause of the ViaSat-3 Americas problem to determine how to avoid the issue on its upcoming ViaSat-3 EMEA (Europe, the Middle East, and Africa) satellite. Beyond a problematic reflector, which appears to have been made by Northrop Grumman , Viasat said the Americas satellite's other systems "are performing as expected, or better." The company said it expects "to gain additional bandwidth from the existing in-orbit fleet" through improvements to its ground network. After its acquisition of Inmarsat, Viasat has 22 satellites in space. "We believe these augmentations will allow us to provide the high-quality experience our mobility customers have come to expect and allow us to support our near- and intermediate-term growth objectives," Viasat said. While broadband service to U.S. residential customers makes up about 13% of Viasat's current revenue, the company expects "that percentage will decline" after the satellite malfunction. Part of Viasat's mitigation strategy is to "assure service" to high demand and key customers, as growth in VIasat's fixed broadband business is expected to be delayed. Despite the issues, Viasat forecast that revenue will grow further in fiscal year 2025.

Hollywood strikes have already had a $3 billion impact on California's economy, experts say: It's causing 'a lot of hardship' 2023-08-09 - People take selfies beneath the Hollywood sign as the WGA (Writers Guild of America) strike continues on July 12, 2023 in Los Angeles, California. The TV and film writers' strike has crossed 100 days since the Writers Guild of America and the Alliance of Motion Picture and Television Producers failed to reach an agreement on a new contract, and it's likely to have cost the California economy at least $3 billion so far. That's according to estimates from Todd Holmes, a professor of entertainment industry management at Cal State Northridge, based on economic analysis from the last Writers Guild of America strike that started in 2007. That strike led to 37,700 lost jobs and a $2.1 billion blow to the California economy, according to the Milken Institute, an economic think tank. Holmes took that $2.1 billion figure and adjusted it for inflation and other factors to come to a new strike-induced loss of upwards of $3 billion for the state of California today. It's likely to be even higher now accounting for the additional members of the Screen Actors Guild-American Federation of Television and Radio Artists, the union which represents various performers, joining picket lines in July. Widespread impacts from restaurants to real estate The strikes don't impact just writers or actors. Halted productions impact all kinds of businesses, including companies that provide catering for productions, restaurants near studios, prop houses, set builders, dry cleaners, professional drivers, florists and more. "A lot of different people are impacted surrounding the industry," Holmes says, "and it's causing them a lot of hardship." People who hold entertainment jobs and entertainment-adjacent roles account for almost 20% of the LA-area income, says Lee Ohanian, an economics professor at the University of California, Los Angeles. "The economic impact is even bigger because average compensation in the industry is considerably higher" than the average earner, he tells CNBC Make It. That can have a big downstream effect if those workers pull back on their discretionary spending, especially for big purchases like buying a car or a home. In one high-profile instance, actor Billy Porter said in an interview with Evening Standard he is selling his house to save money during the strikes. A housing crunch could push rent prices higher and cause lower earners to leave the state, said Kevin Klowden, lead author of the Milken report, according to LA Times reporting: "We saw an exodus in the last writers' strike," he said. Across the state, some 700,000 people are employed in entertainment jobs, or close to 5% of the California workforce, Ohanian says. How long could the strike last Some experts say the current strike could set the record for the longest writers' strike in Hollywood history. A 1988 strike lasted 22 weeks, while the strike in 1960 (also the last time writers and actors were both on strike) lasted 21 weeks. Now entering its 15th week, the current strike would surpass both of those records if it goes on until mid-October. "I could easily see that being broken," says Ohanian. "Typically, workers have less of an economic cushion than the corporate side, so oftentimes in long strikes the unions tends to cave. But thus far, we're not seeing that, and this could certainly reach the six-month mark." If strikes last until October, Holmes estimates the economic cost will total closer to $4 billion to $5 billion. "With the dual strikes, if it were to go beyond that into November, that estimate would be closer to $5 billion-plus," Holmes says. Why this strike could break records: Union solidarity versus disjointed studios On Friday, WGA leaders met with negotiators for the Alliance of Motion Picture and Television Producers, which represents Hollywood studios and streamers, for the first time since the strike began May 2. However, the two parties reached a stalemate over two key proposals to establish minimum staffing levels in episodic TV and a guaranteed minimum number of weeks of employment. The union also confirmed it's seeking the right to honor other unions' picket lines, meaning even if WGA gets a deal, writers will still want to honor striking SAG members, and work won't resume until both strikes are resolved, Variety reports. The WGA represents 11,500 members, while SAG-AFTRA represents roughly 160,000 members. However, "as united as writers and actors are, it's more disjointed on the studio side," Holmes says. That's because, in addition to traditional studios like Disney and Warner Bros. Discovery, the AMPTP represents tech companies like Amazon and Apple that have changed the landscape with streaming. For these tech companies, the production and entertainment slice of their business is a much smaller piece of what they do, Holmes says, so it's going to be easier for them to hold off on negotiating a deal compared with traditional studios where a work stoppage may have a bigger impact on their bottom line. Politicians could bring strikes' end: 'They're trying to mediate a fight between two of their kids'

Nvidia unveils an update to a new A.I. chip that hasn't even shipped yet — an aggressive move to keep its crown 2023-08-09 - Nvidia is watching the throne. One day after the king of artificial intelligence chips unveiled new hardware-and-software updates aimed at furthering its leadership in the booming corner of the technology world, the stock dropped more than 4%, adding to the nearly 1.7% decline in the prior session. Perhaps, it's not surprising to see Club name Nvidia (NVDA) give back some gains lately as shares have nearly tripled in 2023. The stock, which closed at a record high of $474.94 on July 18, has been rather flat over the past month. NVDA YTD mountain Nvidia YTD performance After the year the company has had, these latest AI developments are assuring for shareholders, like us, whose investment thesis rests on Nvidia's AI dominance today and tomorrow. It's apparent that Nvidia sees the mounting competition — from fellow Club holding and semiconductor maker Advanced Micro Devices (AMD) and others — but intends to keep innovating and improving its offerings. New AI hardware Case in point: At an industry conference Tuesday, Nvidia announced a next-generation GH200 Grace Hopper Superchip, just over two months after its first version entered full production and before it has even fully shipped to customers. Beyond hardware, Nvidia also said it was partnering with AI community startup Hugging Face, signaling a willingness to embrace parts of the open-source artificial intelligence software landscape. "No one is coming for Nvidia on AI, period, any time soon," Stifel analyst Ruben Roy told CNBC in an interview Wednesday. The GH200 Grace Hopper Superchip — which links together traditional central processing units (CPUs) and graphics processing units (GPUs) — is designed to power the large language models that undergird generative AI applications, such as ChatGPT from Microsoft -backed OpenAI. While Nvidia's H100 GPU has become the leading chip to train AI models, the company has positioned the Grace Hopper Superchip to run the models on a day-to-day basis, a process known as inference. The new version of Grace Hopper primarily delivers improvements in memory capacity and bandwidth compared with the first-generation product. This is important because memory plays a key role in the process of a generative AI application returning an answer to user prompt. When a user asks ChatGPT to write a poem on a particular topic, that initial inquiry is fielded by the CPU. "Then it's going to go out and search for the best poem based on whatever parameters you're giving it," Roy explained. "Where does it find all those parameters? Memory." In practice, improving the memory capacity and bandwidth of the Grace Hopper Superchip should help AI applications run more efficiently and smoothly. Second-gen Grace Hopper uses a new type of premium memory processor, known as HBM3e, to deliver these upgrades. Volume production of the improved Grace Hopper Superchip is expected in the second quarter of 2024, according to Nvidia. At that point, Roy said, to his knowledge, Grace Hopper Superchip will be "the only platform out there that's capable of handling HBM3e memory," adding a wrinkle to the competitive landscape. In a note to clients Tuesday, Bank of America argued the technical specs Nvidia released suggest the upgraded Grace Hopper "exceeds" AMD's CPU-plus-GPU super chip offering, the MI300A. Nvidia's forthcoming chip will have 282 gigabytes of HBM3e memory, compared with 128GB of the older HBM3 memory for the AMD chip. The MI300A, along with MI300X chip — designed specifically for generative AI applications — are on track for a fourth-quarter rollout , AMD management said last week in its post-earnings call. "The highest-end, flagship workloads that [cloud service providers] are going to try and sell, this is going to be the only game in town," Roy said of second-gen Grace Hopper. The Stifel analyst also said that Nvidia's decision to apparently accelerate the Grace Hopper roadmap — before the first gen is widely deployed — suggests "a lot of customer interest." Open-source software Nvidia's closed-source CUDA software platform – along with a library of pre-trained AI models — has helped establish the company's AI dominance. It's a secret sauce of hardware and software. Then came Tuesday's revelation that Nvidia was partnering with Hugging Face — seen as a leader in open-source AI — to give software developers using that startup's platform access to Nvidia DGX Cloud , a supercomputer accessible through a web browser that can be utilized to train and finetune models. AMD and semiconductor rival Intel (INTC) have marketed their AI strategies as embracing open-source models, in contrast to Nvidia. For example, on Intel's latest earnings call, Intel CEO Pat Gelsinger highlighted the firm's goal to "democratize AI" four times, according to a FactSet transcript. AMD bills ROCm — its rival to Nvidia's CUDA — as an "open software platform." In June, when it debuted a fresh AI-targeted chip, AMD also announced a noteworthy collaboration with Hugging Face , beating Nvidia to the punch. "Nvidia hadn't done it [open source] until now because they didn't have to," Roy said. "They had a propriety, closed operating system called CUDA. Why do they have to go and do an open ecosystem if there's no competition out there?" With more competitors now jockeying for a slice of the AI market, the Stifel analyst said it's only "logical" that Nvidia decided to embrace open source, as well. Nvidia on Tuesday also teased an update to Omniverse, its 3D graphics platform that companies such as BMW can use to build digital versions of factories before building them in the real world. Those digital factories can also be used to train autonomous warehouse robots, as in the case of Club name Amazon (AMZN). Among the new features coming soon to Omniverse soon are generative AI capabilities. Earlier Wednesday, Jim Cramer highlighted the benefits of the Omniverse for industrial use and the other software and hardware announcements at the conference in predicting that Nvidia stock has more room to run. The Club price target remains at $450 per share ahead of Nvidia's latest quarterly earnings release two weeks from now on Aug. 23. Bottom line Our investment in Nvidia hasn't gone on autopilot just because Jim designated the stock an "own it, don't trade it" position. We constantly test our long-term bullishness against things we read and see in the here and now. Shares of Nvidia may be slumping Wednesday, due in part to a supply warning Tuesday night from server maker Super Micro Computer . Jim reached out to NVDA for comment, but it's too close to its quarterly earnings report for the company to address. However, bigger picture, Nvidia's recent updates on both the hardware and software side only reinforce our view that the chipmaker — already worth over $1 trillion — will persist as the dominant AI enabler — and, as a result, grow more valuable over time. To be sure, we expect AMD to eventually play in the expanding AI marketplace, offering an accelerated computing alternative to Nvidia. But it's early innings on that journey for AMD, and the traditional data-center market — where it's been stealing share from Intel thanks to its high-quality CPUs — remains a larger source of near-term revenue. Those dynamics justify our small position in AMD. When it comes to AI, though, Nvidia still wears the crown. (Jim Cramer's Charitable Trust is long NVDA, AMD, MSFT, AMZN. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED. Nvidia CEO Jensen Huang,speaks at the Supermicro keynote presentation during the Computex conference in Taipei on June 1, 2023. Walid Berrazeg | Sopa Images | Lightrocket | Getty Images

At at former Solo cup factory turned wind tower plant, Biden showcases a green energy revolution 2023-08-09 - U.S. President Joe Biden delivers remarks on the economy at Arcosa, a wind tower manufacturing facility, in Belen, New Mexico, August 9, 2023. President Joe Biden visited a former Solo cup factory that has been renovated into a wind tower plant in Belen, New Mexico on Wednesday, where he hailed his green energy economic plan at a groundbreaking for the new facility. "For the longest time we've been told to give up on American manufacturing — that it can't happen again," Biden said. "I've never believed that. As I've said: America used to lead the world in manufacturing. We're going to do it again." The new Arcosa factory is expected to create 250 new jobs in a state where more than one in six residents lives in poverty. "What Arcosa is doing here is part of a much broader clean energy manufacturing boom, it's going to happen in big cities and rural communities as well," Biden said. "Whether you live in a blue state or a red state, I'm going to keep my promise." The event at the wind tower plant coincided with the year anniversary of the signing of the Chips and Science Act and the Inflation Reduction Act, which was signed a week later. The White House said that after the passage of the Inflation Reduction Act, Arcosa received $1.1 billion in new wind tower orders, prompting it to build this new plant. Arcosa was the latest stop in Biden's swing across the southwestern United States this week, where he has been highlighting his administration's climate change initiatives. The president was in Arizona on Tuesday, where he designated the lands surrounding the Grand Canyon a national monument.

UPS CEO says drivers will average $170,000 in pay and benefits at end of 5-year deal 2023-08-09 - UPS ' CEO said drivers will average $170,000 in pay and benefits such as health care and pensions at the end of a five-year contract that the delivery giant struck with the Teamsters Union last month, averting a strike. The tentative agreement covers some 340,000 workers at the package carrier. They are in the middle of a ratification vote that began Thursday and ends Aug. 22. "We expect our new labor contract to be ratified in 2 weeks," UPS CEO Carol Tomé said on an earnings call Tuesday. The company cut its full-year revenue and margin forecasts "primarily to reflect the volume impact from labor negotiations and the costs associated with the tentative agreement." The tentative deal would raise part-time workers' wages to at least $21 an hour. Their pay was a sticking point during negotiations. Full-time workers will average $49 an hour, and the agreement would end mandatory overtime on drivers' days off, according to a summary posted by the Teamsters Union. The deal is the latest large wage increase won in labor negotiations. Workers from pilots to aerospace manufacturing employees have recently pushed for and won higher pay.

White House restricts U.S. investment in some Chinese tech, citing national security concerns 2023-08-09 - A researcher works inside a superconducting quantum computing laboratory at Beijing Academy of Quantum Information Sciences (BAQIS) on February 26, 2021 in Beijing, China. WASHINGTON — President Joe Biden signed an executive order on Wednesday aimed at regulating new U.S. investments and expertise that supports Chinese development of sensitive technologies. The new measure, which is expected to be implemented next year, targets investment in semiconductors and microelectronics, quantum computing and certain artificial intelligence capabilities. Biden warned in the executive order that certain American investments may contribute to "the development of sensitive technologies and products in countries that develop them to counter United States and allied capabilities." "I find that countries of concern are engaged in comprehensive, long-term strategies that direct, facilitate, or otherwise support advancements in sensitive technologies and products that are critical to such countries' military, intelligence, surveillance, or cyber-enabled capabilities," the president added. The executive order will also require outbound U.S. investors to provide notifications to the Treasury Department. Treasury Secretary Janet Yellen is largely placed at the helm of delivering on this executive order. The measure calls on Yellen to "define sensitive technologies and products in these categories for purposes of the prohibition and the notification requirement." Yellen is also tasked with coordinating action with Secretary of Commerce Gina Raimondo, Secretary of State Antony Blinken, Secretary of Defense Lloyd Austin, Secretary of Energy Jennifer Granholm as well as the Director of National Intelligence Avril Haines.

Zoom's terms of service change sparks worries over AI uses. Here's what to know. 2023-08-09 - AI could steal information by listening to you type, study finds AI could steal by listening to you type AI could steal by listening to you type When Zoom announced an update to its terms of service earlier this week that appeared to provide access to users' data for AI training, privacy advocates and customers rang the alarm. "Zoom's [terms of service] now demand that they use AI to train on audio, face and facial movements, even private conversations without recourse, unconditionally and irrevocably," scientist Bryan Jones said in a tweet, "Opting out is not an option." The backlash prompted Zoom to clarify its service terms in a blog post on Monday, where it promised not to "use audio, video, or chat content for training our models without customer consent." However, while privacy experts say that promise is now codified in Zoom's user agreement, they warn that it doesn't prevent the company from using customer data to train AI. As a result, many users are confused about how much of their data is being used and how to protect their privacy during digital meet-ups. Zoom did not immediately respond to a request for comment. Can Zoom access users' video calls to train AI? Yes, Zoom can use customers' video calls and chat transcripts to train AI, as long as it has users' consent. However, if a meeting host agrees to share data with Zoom, everybody participating in the meeting must share their data during that call. This means participants who don't want to share their information with the company must leave the call if their host consents to data sharing. This could be a problem for workers whose employers require them to attend Zoom sessions. "If the administrator consents and it's your boss at your work who requires you to use Zoom, how is that really consent?" Katharine Trendacosta, director of policy and advocacy at the Electronic Frontier Foundation, told the Associated Press. What kind of data can Zoom collect? There are two types of data Zoom can collect: "service-generated data," such as the features customers use and their locations, and "customer content," or the data created by users themselves, such as audio or chat transcripts. In its blog post, Zoom said the company considers service-generated data "to be our data," and experts confirm this language would allow the company to use this data for AI training without obtaining additional consent. Service-generated data may be used for "for the purpose of … machine learning or artificial intelligence (including for the purposes of training and tuning of algorithms and models," according to Zoom's terms of service. As for customer content, Zoom may use the data "for the purpose" of machine learning or AI, the same agreement shows. What is Zoom doing with AI? In its blog post, Zoom said it will use customer data to train artificial intelligence for AI-powered features, such as automated meeting summaries for customers. However, it's unclear if the company is working on other consumer-facing AI products or internal projects that will tap customer data. Zoom's terms of service agreement is "super broad," meaning the company could use certain types of customer data for any number of AI projects, Caitlin Seeley George, campaigns and managing director at Fight for the Future, told CBS MoneyWatch. "[Zoom's] updated terms of service are very broad and could allow them to do more than summarize meetings, even if they aren't doing it yet," George said. How do I know if a meeting organizer is sharing data during our call? If a meeting organizer decides to use a feature that requires user-generated content like call or chat transcripts to be shared with Zoom, the meeting's participants will receive an alert that an AI feature has been enabled and that their data could be shared for AI training, the AP reported. The app will then prompt participants to either proceed with the meeting or to leave. What are some alternatives to Zoom? Privacy advocates like George recommend steering clear from Zoom until the company provides more details about how users will give their informed consent, which data will be collected and how it will be used. Of course, there are other platforms Zoomers can use to host video calls. Signal, which has a strong privacy focus, promises not to "collect or store any sensitive information" and can be used to create chats and group calls for up to 40 people, its website shows. Jitsi, a privacy-focused video conferencing tool, can also host group calls. The open-sourced platform is free and offers unlimited time on video calls. With reporting by the Associated Press.

China is edging toward deflation. Here's what that means. 2023-08-09 - Whereas the U.S. continues to grapple with elevated prices, China is dealing with the opposite problem. In July, the world's second largest economy slipped into deflationary territory, with consumer prices declining 0.3% from a year earlier. The decline in consumer prices sets China apart in more ways than one. In the post-COVID era, many nations, ranging from the U.K. to the U.S., have struggled with high inflation sparked by a combination of government spending and tight labor markets, which have sent their economies into overdrive. China's deflation comes amid high unemployment for its younger workers, with more than 1 in 5 people between 16 to 24 unable to find a job. Meanwhile, the country's economic activity fizzled out earlier than expected following the lifting of virus controls, prompting Chinese leaders to try to shore up business and consumer activity. "China's economic trajectory has been a focal point of global attention for decades, with its staggering growth and transformation capturing the world's imagination," noted Nigel Green of wealth management company deVere Group in a Wednesday research note. "But the recent emergence of serious deflationary pressures in the world's second-largest economy is triggering concerns that extend well beyond its borders." Here's what to know about deflation. What is deflation? Deflation is a decline in overall price levels, and is the opposite of inflation, when prices rise over a period of time. Deflation typically is linked with economic downturns, such as during the Great Depression in the U.S. during the 1930s, according to the Federal Reserve Bank of San Francisco. Is deflation bad? Deflation might seem like a good trend, at least on the face of it — after all, if prices decline, that means your paycheck will go farther because and, in theory at least, you'll have more purchasing power. But deflation's impact can hit a nation's broader economy in a number of negative ways. For one, if people believe items will cost less next week or next month, they may hold off on buying products or services, strangling the lifeblood of an economy: consumer spending. If that happens, companies could respond by cutting workers, trimming wages or making other adjustments. Secondly, deflation is a negative for people or businesses with debt, such as mortgages or other loans. That's because even though prices are falling, the value of debt doesn't change, which puts pressure on consumers and businesses to cut spending in order to service their debt payments. Why is China experiencing deflation? China's deflation appears to be coming from two sectors — transportation and food, with pork prices down 26% year over year, Ben Emons, senior portfolio manager and head of fixed income at NewEdge Wealth, said in a Wednesday research note. Stripping out volatile food and energy prices, China's consumer price index rose 0.8% in July, he noted. Overall, the deflation experienced last month in China is "mild" and could be quickly reversed, Emons added. "China may be in deflation but that is less likely to persist as the Chinese government is set on hitting the GDP target of 5.5%," he wrote. "Moreover, pork-driven disinflation can be manipulated, which means that China CPI deflation is likely to reverse quickly." Could deflation in China impact the U.S.? It's possible, partly because the U.S. imports a lot of goods from China, according to economists and market experts. "As its exports become cheaper due to deflation, other economies might face increased competition, forcing them to lower their own prices or risk losing market share," Green of deVere group noted. He added, "Also, reduced demand for raw materials and commodities due to its economic slowdown is likely to lead to a decrease in global commodity prices."

Once valued at $47 billion, WeWork warns of "substantial doubt" that it can stay in business 2023-08-09 - Once worth as much as $47 billion, WeWork is now warning that there is "substantial doubt" about the company's ability to stay in business over the next year because of factors such as financial losses and a need for cash. Shares of WeWork tumbled 2 cents, or 11%, to 19 cents in premarket trading as investors digested the announcement Tuesday by the office-sharing company that its future is contingent upon its improving liquidity and profitability over the next 12 months. WeWork was once the biggest tenant in New York City, and made its name leasing, renovating and subleasing office space in cities nationwide. It eventually sold shares to the public in 2021, two years after a spectacular collapse during its first attempt to go public — which led to the ousting of its CEO and founder, Adam Neumann. But the company has faced ongoing scrutiny of its finances. "Substantial doubt exists about the Company's ability to continue as a going concern," WeWork said Tuesday. "The company's ability to continue as a going concern is contingent upon successful execution of management's plan to improve liquidity and profitability over the next 12 months." The company leases buildings and divides them into office spaces to sublet to its members, which include small businesses, startups and freelancers who want to avoid paying for permanent office space. But over time its operating expenses soared and the company relied on repeated cash infusions from private investors. The company also said Tuesday it is facing high turnover rates by its members. It said it plans to negotiate more favorable lease terms, control spending and seek additional capital by issuing debt, stock or selling assets. WeWork's interim CEO, David Tolley, sounded an optimistic note Tuesday in the company's results for the second-quarter, during which it reported a loss of $349 million. "The company's transformation continues at pace, with a laser focus on member retention and growth, doubling down on our real estate portfolio optimization efforts, and maintaining a disciplined approach to reducing operating costs," Tolley said.

Biden issues order curbing U.S. investment in Chinese tech sectors 2023-08-09 - Washington — The Biden administration will try to slow Beijing's development of next-generation technologies that could have military and intelligence applications — like advanced semiconductors, artificial intelligence and quantum computing — by limiting some American investment in those sectors in China. An executive order issued by President Biden on Wednesday outlines new regulations that will subject investments by American firms to unprecedented new federal oversight by the Treasury Department. The aim is to ensure that U.S. cash does not support China's military modernization and potentially threaten the United States. The rules will not take effect for at least a year, and there will be a public comment period so businesses and other groups can weigh in before they are finalized. "It's important to recognize this is a national security action, not an economic one," said a senior administration official, who spoke on condition of anonymity to discuss the order. "We recognize the cross border investment flows have long contributed to U.S. economic vitality. This executive order protects our national security interests in a narrowly targeted manner, while maintaining our long standing commitment to open investment." Under the order, Americans will be barred from making investments in China's advanced chip sector. Investments in less-advanced chips and artificial intelligence will be permitted, but will require U.S. government notification. Investment in quantum computing – specifically the development of computers, sensors and networks – will be prohibited. The rules only apply to new investments, not existing deals. Transactions by private equity and venture capital firms in particular will be scrutinized. The executive order came together after months of engagement with the private sector. Some American executives had expressed concern that clamping down on the flow of U.S. capital to China could hurt U.S. businesses and have a negative impact on the domestic economy. China has the world's second-largest economy with more than 1 billion consumers, making it a vital market for many American companies. Senior administration officials repeatedly emphasized in a briefing Wednesday that the U.S. remains committed to capital investment between the world's two largest economies. Indeed, officials said they were trying to limit the transfer of so-called "intangible" benefits — namely American expertise — that could accelerate the development of Chinese technology. Private equity and venture capital groups often connect companies in their investment portfolios with experts to help them grow. The move comes ahead of an expected trip later this month by Commerce Secretary Gina Raimondo to Beijing, as well as an expected visit to the U.S. by Chinese Foreign Minister Wang Yi. Earlier this summer, Secretary of State Antony Blinken and Treasury Secretary Janet Yellen took separate trips to Beijing to help ease tensions between the two countries. In Yellen's meetings with her Chinese counterparts, she tried to reassure them that the executive order would be "highly targeted." "I want to allay their fears that we would do something that would have broad-based impacts on the Chinese economy," Yellen said at a July press conference in Beijing. "That's not the case. That's not the intention." The Chinese Embassy in Washington did not immediately respond to a request for comment on Wednesday's executive order. Still, Xie Feng, China's ambassador to the U.S., has warned that Beijing will respond. "The Chinese government cannot simply sit idly by," Xie said at the Aspen Security Forum in July. "There's a Chinese saying: 'We will not make provocations, but we will not flinch from provocations.' So China definitely will make our response." State Department spokesman Matthew Miller said Wednesday that Washington had made clear in prior diplomatic engagements with China that the U.S. would always protect its national security interests but that open dialogue remained essential to preserving stability in the relationship. "[E]ven though we will be taking these actions, just as they take policy actions that we don't agree with, we think it's still important that we have the ability to have conversations about our areas of disagreement so we can make sure that the relationship doesn't deteriorate," Miller said. The measures come as China and the United States are increasingly locked in a technological arms race. Last October, the Commerce Department announced new restrictions on sales to China of advanced technology needed to build high-end semiconductors. The move was aimed at crippling China's ability to develop its own domestic manufacturing capabilities and slow the development of supercomputers and some weapons, such as hypersonic missiles. This latest move is targeted specifically at capital flows out of the United States. In June, Blinken said in an interview with "Face the Nation" moderator Margaret Brennan that the administration sought to build a "very high fence around a very small piece of land." He added, "That small piece of land has very sensitive technology that could be used against us. We're not going to let that happen." Some lawmakers, like House Foreign Affairs Chairman Michael McCaul, are concerned that the investment restrictions do not go far enough. "While I'm pleased to see the Biden administration restrict new outbound investments in China, the failure to include existing technology investments as well as sectors like biotechnology and energy is concerning," McCaul said in a statement.

Banks get a downgrade from Moody's. Here are the 10 lenders impacted. 2023-08-09 - Moody's is downgrading the credit ratings of 10 small- to mid-sized banks, citing growing financial risks and strains that could erode their profitability. The credit ratings agency also warned it is watching some of the nation's biggest lenders for potential downgrades. The actions come after a banking crisis that started in March with the sudden collapse of Silicon Valley Bank, once the nation's 16th largest bank, when depositors grew fearful of the bank's solvency and made a classic bank run. Signature Bank and First Republic Bank soon followed, leading to more concerns about the banking industry's stability. U.S. markets fell on Tuesday as Wall Street digested the downgrades as well as the negative outlooks for some of the biggest U.S. banks. M&T Bank, one of the banks whose credit rating was cut, fell 1.5% on Tuesday and shed another 1.4% in late morning trading on Wednesday. Truist Financial, one of the banks that Moody's said it is reviewing for a possible downgrade, fell 1.8% on Wednesday. In its report, Moody's highlighted that some of the issues that caused the banking crisis earlier this year haven't disappeared; banks are still at risk for depositors to withdraw their funds, while the current higher-interest rate environment is knocking down the value of investments lenders made when rates were super low. The rating agency added that asset risks are also rising for small- and mid-sized banks, especially those with large corporate real estate (CRE) holdings. "Elevated CRE exposures are a key risk given sustained high interest rates, structural declines in office demand due to remote work, and a reduction in the availability of CRE credit," it noted. Smaller banks are especially at risk, given that they have "sizable unrealized economic losses" that could cause investors to lose confidence, it stated in the Monday report. "These are the major credit agencies diagnosing the issue that small and regional banks are not uniquely situated to handle a high interest rate environment," J.D. Durkin, the host for financial site TheStreet, told CBS News. Even so, he added that while individuals may be concerned about their banks, there isn't much call to be worried about the safety of deposits, given the regulatory backstops such as FDIC insurance and the steps that U.S. regulators took when banks such as Silicon Valley Bank collapsed. "Consumers were made whole," he noted. List of downgraded banks Moody's cut ratings of 10 banks on Monday. The largest lender to receive a lower rating is M&T Bank, the 19th largest U.S. bank by assets, according to the Federal Reserve. Here's the list of banks downgraded: Commerce Bancshares BOK Financial Corporation M&T Bank Corporation Old National Bancorp Prosperity Bancshares Amarillo National Bancorp Webster Financial Corporation Fulton Financial Corporation Pinnacle Financial Partners Associated Banc-Corp 6 banks with ratings under review Moody's also said it placed six banks under review for possible downgrades, with some of those banks among the nation's largest. They are: Bank of New York Mellon Corporation Northern Trust Corporation State Street Corporation Cullen/Frost Bankers Truist Financial Corporation U.S. Bancorp 11 banks with negative outlooks The credit rating agency also said it shifted the outlook of 11 banks from stable to negative. They are: PNC Financial Services Group Capital One Financial Corporation Citizens Financial Group Fifth Third Bancorp Huntington Bancshares Regions Financial Corporation Cadence Bank F.N.B. Corporation Simmons First National Corporation Ally Financial Bank OZK With reporting by the Associated Press

"Jeopardy!" game show to reuse questions, contestants during WGA strike 2023-08-09 - How the SAG-AFTRA and WGA strikes could immediately affect box office revenue The Hollywood writer's strike is forcing "Jeopardy!" now in its 40th season, to make adjustments to its show after producers acknowledged the original plan was "compromised" by the historic labor movement. Lacking sufficient fresh material for a new season, "Jeopardy!" will recycle both old material and contestants, executive producer Michael Davies revealed on the most recent episode of the "Inside Jeopardy!" podcast. He called it the "most optimal solution," given the circumstances and the fact that the show's original plan was scuttled. He explained the impetus for not hosting first-time trivia competitors in the midst of the Screen Actors Guild and the American Federation of Television and Radio Artists (SAG-AFTRA) strike. "I also believe principally that it would not be fair to have new contestants making their first appearance on the Alex Trebek stage doing it with non-original material or a combination of non-original material and material that was written pre-strike," he said. A second chance The show's producers have found a workaround it hopes will be a hit with both contestants and viewers. It will proceed with a new season of the show featuring contestants from season 37 who lost their first games. Normally, first-round losers would not be given a second chance to appear on stage. "We decided that really we needed to invite back and give a second chance in general to players who probably thought that their chance to come back and play on the Alex Trebek stage had gone forever," Davies continued. The returning contestants will compete on a combination of material written before the strikes as well as material "that is being redeployed from multiple, multiple seasons of the show," Davies said. He announced an additional major change unrelated to the WGA strike. The prize purses for second and third place finishers will increase by $1,000 each. "So third-place prize will move up to $2,000, the second place prize will move up to $3,000," Davies said. The move had been a work in progress he added, given that contestants have to pay their own way to appear on the show. "We understand that post-COVID, travel costs have increased. We understand how complicated funding a trip to 'Jeopardy! is for many contestants within our community, and we think this is way about time that we did this," Davies said. "Celebrity Jeopardy!" will return with both brand new material and contestants in September, Davies added, given that trivia questions were completed before writers went on strike. It features all new original material, and the show is currently booking guests.

Winning Mega Millions ticket sold in Neptune Beach, Florida, for record jackpot of $1.58 billion 2023-08-09 - A single winning ticket was sold for Tuesday night's record estimated $1.58 billion Mega Millions jackpot, lottery officials said. It was purchased at a Publix supermarket in Neptune Beach, Florida. Neptune Beach is on the Atlantic coast, near Jacksonville. What were the winning Mega Millions numbers? The winning numbers were 13, 19, 20, 32, 33, and a Mega Ball of 14. The holder or holders of that ticket have not yet been publicly identified. The winner has the choice of taking an estimated lump sum payment of $783.3 million before taxes or going with the annuity option. That consists of an immediate payment followed by 29 annual payments that increase in value and eventually equal the full jackpot minus taxes. The jackpot had been growing since it was last won in New York in mid-April. Since then, 31 drawings were held without anyone matching all six numbers. That changed in the 32nd. Biggest lottery jackpots Along with being the largest windfall in Mega Millions history, it was apparently the third biggest in U.S. lottery history. In February, a winning ticket sold at a gas station near Los Angeles claimed a $2.04 billion Powerball jackpot, the largest in lottery history. In January 2016, winning tickets were bought in California, Florida and Tennessee for a $1.586 billion Powerball pot of gold. It was unclear whether that grand prize topped Tuesday night's estimated $1.58 billion Mega Millions jackpot. Tuesday's Mega Millions jackpot was the second billion-dollar windfall up for grabs this summer. Last month, a Powerball player bought a winning ticket in Los Angeles for that game's $1.08 billion jackpot. The odds of winning the Mega Millions jackpot are about 1 in 302.58 million. Mega Millions tickets, which are $2 each, are sold in all states except Alabama, Utah, Alaska, Hawaii and Nevada. They're also sold in Washington, D.C., and the U.S. Virgin Islands. Drawings take place every Tuesday and Friday at 11 p.m. EDT. –Additional reporting by Brian Dakss.

WeWork Has Sent a Distress Signal. Here’s What to Know. 2023-08-09 - WeWork, which promised to revolutionize the way people work alongside one another, announced in a financial filing on Tuesday that it had “substantial doubt” it would stay in business. That declaration raises questions about not only the company’s viability but also the future of commercial real estate. Here’s what you need to know about WeWork’s past and prospects. What is WeWork? WeWork was founded in 2010 by Adam Neumann and Miguel McKelvey, tech entrepreneurs who used the funds from the sale of their previous co-working start-up, Green Desk. WeWork’s vision was to create a “physical social network” that would appeal to a new class of workers who were freelancing or working from home. The business model was to sign long-term leases for office buildings (or individual floors), spruce up those spaces and rent them to freelancers and companies. The company would attract clients, the thinking went, by offering incentives like beer and hard kombucha as well as chic interior design — and would charge them enough to make a profit after WeWork made its lease payments.

For Disney, Streaming Losses and TV’s Decline Are a One-Two Punch 2023-08-09 - Robert A. Iger’s urgent need to overhaul Disney — to turn its streaming division into a profitable enterprise and pull back on its troubled traditional television business — came into sharp relief on Wednesday. Disney’s streaming operation lost $512 million in the most-recent quarter, the company said, bringing total streaming losses since 2019, when Disney+ was introduced, to more than $11 billion. Disney+ lost roughly 11.7 million subscribers worldwide in the three months that ended July 1, for a new total of 146.1 million. All the decline came from a low-priced version of Disney+ in India. Last year, Disney lost a bid to renew the expensive rights to Indian Premier League cricket matches. Excluding India, Disney+ gained 800,000 subscribers, primarily overseas. To make streaming profitable, Mr. Iger, Disney’s chief executive, has shifted the focus at Disney+ away from brisk subscriber growth, which requires expensive marketing campaigns. Instead, Disney has been trying to make more money from the Disney+ subscribers it already has. The monthly price for access to an ad-free version of Disney+ rose to $11 in December, from $8.

San Francisco Balks at Expanding Driverless Car Services on City’s Roads 2023-08-09 - Over the past year or so, a jarring sight has become common in San Francisco: driverless cars buzzing around the city’s streets with no one at the wheel and an expensive array of electronic sensors guiding the way. But a plan by two companies to expand driverless taxi services in San Francisco has met stiff resistance from city officials and some activists. The fight has become a Rorschach test for local tolerance of the tech industry’s new ideas: Are the driverless cars an interesting and safe transportation alternative? Or are they a nuisance and a traffic-blocking disaster waiting to happen? With more than 800,000 residents, hilly San Francisco is the second most densely populated city in the country. Whether self-driving cars can succeed in the city will be a harbinger for their viability in other communities. And success in San Francisco could provide, for the first time, a signal that the billions invested by the tech and auto industries into autonomous driving technology could eventually pay off. The California Public Utilities Commission, the state agency responsible for regulating self-driving cars in the city, is set to vote on Thursday on a plan to allow General Motors-owned Cruise and Waymo, which is backed by Google’s parent company, Alphabet, to charge for driverless rides throughout the city, round the clock. Right now, Cruise can offer paid rides late at night in the northwest part of the city, while Waymo offers only free rides.

Biden Orders Ban on U.S. Investments in China’s Sensitive High-Tech Industries 2023-08-09 - President Biden escalated his confrontation with China on Wednesday by signing an executive order banning American investments in key technology industries that could be used to enhance Beijing’s military capabilities, the latest in a series of moves putting further distance between the world’s two largest economies. The order will prohibit venture capital and private equity firms from pumping money into Chinese efforts to develop semiconductors and other microelectronics, quantum computers and certain artificial intelligence applications. Administration officials stressed that the move was tailored to guard national security, but China is likely to see it as part of a wider campaign to contain its rise. “The Biden administration is committed to keeping America safe and defending America’s national security through appropriately protecting technologies that are critical to the next generation of military innovation,” the Treasury Department said in a statement. The statement emphasized that the executive order was a “narrowly targeted action” complementing existing export controls and that the administration maintained its “longstanding commitment to open investment.” Narrow or not, the new order comes at perhaps the most fraught moment in the U.S.-China relationship since President Richard M. Nixon and Secretary of State Henry Kissinger opened a dialogue with Beijing in the early 1970s. A series of expanding export controls on key technologies to China has already triggered retaliation from Beijing, which recently announced the cutoff of metals like gallium that are critical for the Pentagon’s own supply chain.

Does Information Affect Our Beliefs? 2023-08-09 - ‘Filter bubbles’ and democracy Sometimes the dangerous effects of social media are clear. In 2018, when I went to Sri Lanka to report on anti-Muslim pogroms, I found that Facebook’s newsfeed had been a vector for the rumors that formed a pretext for vigilante violence, and that WhatsApp groups had become platforms for organizing and carrying out the actual attacks. In Brazil last January, supporters of former President Jair Bolsonaro used social media to spread false claims that fraud had cost him the election, and then turned to WhatsApp and Telegram groups to plan a mob attack on federal buildings in the capital, Brasília. It was a similar playbook to that used in the United States on Jan. 6, 2021, when supporters of Donald Trump stormed the Capitol. But aside from discrete events like these, there have also been concerns that social media, and particularly the algorithms used to suggest content to users, might be contributing to the more general spread of misinformation and polarization. The theory, roughly, goes something like this: unlike in the past, when most people got their information from the same few mainstream sources, social media now makes it possible for people to filter news around their own interests and biases. As a result, they mostly share and see stories from people on their own side of the political spectrum. That “filter bubble” of information supposedly exposes users to increasingly skewed versions of reality, undermining consensus and reducing their understanding of people on the opposing side. The theory gained mainstream attention after Trump was elected in 2016. “The ‘Filter Bubble’ Explains Why Trump Won and You Didn’t See It Coming,” announced a New York Magazine article a few days after the election. “Your Echo Chamber is Destroying Democracy,” Wired Magazine claimed a few weeks later. Changing information doesn’t change minds But without rigorous testing, it’s been hard to figure out whether the filter bubble effect was real. The four new studies are the first in a series of 16 peer-reviewed papers that arose from a collaboration between Meta, the company that owns Facebook and Instagram, and a group of researchers from universities including Princeton, Dartmouth, the University of Pennsylvania, Stanford and others.

A Watch ‘Made in the U.S.A.’ 2023-08-09 - The boast was big: Joshua Nathan Shapiro, founder of the watch brand J.N. Shapiro, declared that its Resurgence watch is the first timepiece made in the United States in more than half a century. “There hasn’t been a watch totally made in the U.S. since Hamilton watches closed down in 1969” and moved to Switzerland, Mr. Shapiro said. His company, based in Torrance, Calif., makes 148 of the watch’s 180 components, and most of the others are provided by U.S.-based companies, a tally that Mr. Shapiro said met the Federal Trade Commission’s standard that “all or virtually all” parts of a product must be made in the country before it may use the label Made in the U.S.A. (The label is on the Resurgence’s movement, he said.)

Discharging Student Debt in Bankruptcy Is Supposed to Be Easier Than Before 2023-08-09 - Alista Lineburg is not a lawyer, but she assumed the role when she couldn’t find one to help her discharge $146,000 of federal student debt in bankruptcy. The process requires a separate lawsuit against the government, something that many lawyers refuse to take on given the time, expense and difficulty of winning. Ms. Lineburg, 49, knows this all too well. Even when the bankruptcy court tried to assign her counsel, there were no takers. “The attorney called and she said, ‘You can’t win this,’” Ms. Lineburg recalled. So she pressed on, alone. And, despite the odds, she won her case. “I feel like I can finally get ahead,” said Ms. Lineburg, who lives in Fairport Harbor, Ohio. She was laid off from her information technology job in June, just two months after clearing her decades-old debt, from an undergraduate degree and a master’s in business administration. Unlike credit card, medical and other consumer debts, student loans don’t automatically disappear in bankruptcy. Debtors need to take an extra legal step — both challenging and costly — known as an adversary proceeding.