By Francesca Fontana
Tech giants are churning out record profits, but investors aren’t satisfied. Apple reported its most profitable quarter ever on Wednesday, thanks to demand for higher-end iPhones and its laptops and tablets. Facebook posted record revenue and profit, but warned of headwinds to its ad business this year amid new curbs on the use of customer data for ad targeting. Apple shares lost 3.5% Thursday, and Facebook shares fell 2.6%.
General Motors Co.
GM plans to run out of gas by 2035. That is the auto giant’s target date for phasing out its gasoline- and diesel-powered vehicles, Chief Executive Mary Barra announced in a social-media post Thursday. GM is among the first major car makers to put a timeline on transitioning to a fully electric lineup, and aims to be carbon neutral by 2040. It’s a big shift, as vehicles that run on fossil fuels and emit pollution account for about 98% of GM’s sales today. Its biggest money makers such as sport-utility vehicles are also among its least fuel-efficient. GM’s goal of going all-electric within 15 years hinges partly on government incentives and other support to nudge consumers toward plug-in cars. GM shares gained 3.5% Thursday.
Apollo Global Management Inc.
Leon Black’s reign at Apollo Global Management is coming to an end. The powerful Wall Street figure plans to cede his CEO role to co-founder Marc Rowan by July 31 after an independent review revealed larger-than-expected payments to disgraced financier Jeffrey Epstein that Dechert LLP nevertheless deemed justified. Mr. Black paid him a total of $148 million for legitimate advice on trust- and estate-tax planning, plus a $10 million donation to his charity — far more than was previously known. The monthslong review also found no evidence that Mr. Black was involved in the criminal activities of the late Epstein, who was indicted in 2019 on federal sex-trafficking charges involving underage girls. Apollo shares rose 7.2% Tuesday.
McDonald’s isn’t loving a new round of Covid-19 shutdowns. The burger giant said on Thursday that its U.S. sales improved in the recent quarter, but tightened restrictions aiming to curb the spread of the virus are hurting its global sales and profit. Tightened limitations on businesses and indoor dining, particularly in Western Europe, dragged on its business abroad. The chain has relied on drive-throughs to help maintain sales in the U.S. during the pandemic, but a smaller proportion of its restaurants have drive-throughs abroad. Pandemic-related costs, including spending on safety equipment, also ate into its profit during the quarter. McDonald’s shares fell 0.1% Thursday.
Walgreens Boots Alliance Inc.
It is up to a new leader to remedy Walgreens’s recent ills. The U.S. drugstore giant on Tuesday named Starbucks Corp. operating chief Rosalind Brewer as its next leader, setting her up to be the only Black woman leading a Fortune 500 company today. The retail veteran, who goes by “Roz,” joined Starbucks and its board in 2017. She helped the company shift focus to takeout operations during the pandemic and has worked to diversify its leadership. Ms. Brewer will join Walgreens and its board on March 15, replacing Stefano Pessina. Walgreens has been struggling to turn itself around, with the pandemic complicating its efforts. Walgreens shares added 4.1% Wednesday.
Southwest Airlines Co.
For U.S. airlines, 2020 was their bumpiest year ever. U.S. airlines lost nearly $35 billion last year as the coronavirus pandemic wiped out travel, according to earnings reports. Southwest Airlines lost nearly $3.1 billion last year — its first annual loss since 1972, the year after the Dallas-based carrier began flying, the company reported Thursday. January and February bookings stalled amid high levels of Covid-19 cases and hospitalizations, and Southwest said it would be cautious about bringing more flights back. The airline expects to stop bleeding cash sometime this year, but said it couldn’t predict exactly when. Southwest shares added 1% Thursday.
Another Covid-19 vaccine is pointing in the right direction. Novavax said Thursday that its vaccine was 89.3% effective at protecting people from Covid-19 in an interim analysis from its late-stage study in the U.K., where a worrisome strain of the coronavirus has been circulating. However, the vaccine was less effective in a separate, middle-stage study in South Africa, where yet another variant has spread. Novavax said it started work on a modified version of its vaccine that better targets the South African strain. The vaccination drive has gained fresh urgency since the emergence of strains that may spread more quickly than the old version of the virus and evade some treatments. Novavax shares jumped 65% Friday.
Write to Francesca Fontana at [email protected]
(END) Dow Jones Newswires
January 29, 2021 19:26 ET (00:26 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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