Uber Revenue Dropped 29% in the Second Quarter: Live Business Updates

Uber said on Thursday that its revenue in the second quarter dropped 29 percent to $2.2 billion from a year ago and that its net loss narrowed to $1.8 billion, as the ride-hailing giant deals with the fallout from the coronavirus pandemic.

The revenue decline was the steepest since Uber went public in May 2019, though total revenue was better than what Wall Street analysts had projected. Uber’s losses improved from $5.2 billion a year ago when it had heavy stock-based compensation costs after its initial public offering.

The pandemic’s hit to Uber’s core ride-hailing business was unmistakable. The company said the amount of money it receives from rides before paying driver wages and other fees declined 73 percent from a year earlier.

But delivery surged, with revenue from Uber Eats, its food delivery business, exceeding the core ride-hailing business for the first time. Revenue from Uber Eats totaled $1.2 billion, while rides shrank to $790 million.

To bolster its delivery business, Uber recently agreed to acquire the food delivery company Postmates for $2.65 billion.

Wall Street regained its footing on Thursday afternoon, pushing higher after an unsteady start to the day, with the S&P 500 inching ever closer to its record and climbing for a fifth consecutive day.

The S&P 500 rose more than half a percent, gains that put the index about 1 percent below a high reached on February 19, before markets went into a tailspin as investors panicked about the fast spreading coronavirus.

Large technology stocks, which have played a large role in the rebound, rallied again. On Thursday, it was Facebook that ranked among the best performing stocks in the S&P 500, with a gain of almost 6.5 percent. Shares of Apple, Google and Microsoft were also higher, and the Nasdaq composite rose 1 percent.

The gains came despite more indications of the economic morass the United States finds itself in, and as prospects for a deal on a new financial rescue package appeared to dim.

It may have helped that President Trump on Thursday said he was willing to act unilaterally to strengthen the economy, saying he was looking at executive orders to forestall evictions, suspend payroll tax collection and provide extra unemployment aid and student loan relief.

Mr. Trump’s comments came after the Labor Department released data showing that workers filed more than one million new state jobless claims for the 20th straight week, as the coronavirus pandemic continued to lead to layoffs and business closures. The tally for last week, 1.2 million claims, was the lowest since March.

Shares in Europe fell, however, weighed down by warnings from Britain’s central bank of a slow recovery ahead.

Bank of England policymakers said that they expected the country’s economy to contract by 9 percent this year, a less severe downturn than they indicated a few months ago, but they also predicted that the economy would not return to its pre-pandemic levels until the end of 2021. Even in three years, they said, the economy will still be smaller than it would have been had the growth rate followed the path it was on at the end of 2019.

The Turkish lira hit a new low against the dollar Thursday, raising fears of a currency crisis that would undermine the fragile economy. The Turkish central bank said Thursday it would “use all available instruments to reduce the excessive volatility in the markets” after the lira fell as low as 7.3 to the dollar, down from 6 to the dollar at the beginning of the year.

Capital One has agreed to pay $80 million to settle federal bank regulators’ claims that it lacked proper cybersecurity protocols, more than a year after a Seattle-based software engineer hacked into a cloud server and stole customers’ social security numbers, bank account information and credit card applications, regulators said Thursday.

The Office of the Comptroller of the Currency, which oversees large U.S. banks, said in a regulatory filing that the bank had failed to establish proper risk assessment procedures in 2015 after it began using cloud storage technology. Later, its board failed to hold the managers in charge of the area accountable for their neglect.

In addition to the civil penalty, Capital One must come up with plans to improve its security procedures within the next three months, according to a separate regulatory filing by the Federal Reserve, which also has authority over the bank.

The hacker was Paige Thompson, a former Amazon employee who broke into a server hosted by Amazon and then boasted about it in several internet forums. Ms. Thompson was arrested in July 2019 and charged with one count of computer fraud and abuse. Her trial is scheduled to begin in February.

Prosecutors say Ms. Thompson stole data relating to more than 100 million Capital One customers, including 140,000 Social Security numbers and 80,000 bank account numbers. The bulk of the information taken involved credit-card applications.

Tatiana Stead, a Capital One spokeswoman, said controls put in place before the hack had allowed the bank to secure customer information before it could be used or disseminated.

“In the year since the incident, we have invested significant additional resources into further strengthening our cyber defenses, and have made substantial progress in addressing the requirements of these orders,” she said.

Household debt fell in the second quarter as consumers stuck at home because of the coronavirus pandemic spent less on their credit cards, based on a new report from the Federal Reserve Bank of New York.

That may seem surprising on face value, with millions of American workers out of jobs and the economy experiencing a sharp recession caused by shutdowns meant to contain the virus. But the Fed’s findings, released Thursday, contribute to a growing body of evidence that suggests the government’s rescue programs and bill deferrals helped to keep many families from falling far behind financially during the early months of the pandemic.

• Total household debt decreased between April and June, falling by $34 billion or 0.2 percent. It was the first decline since 2014 and the largest since 2013.

• Credit card balances plummeted by $76 billion, the steepest drop on record.

• Mortgages were another story entirely. Refinances and other originations boomed after the Fed slashed interest rates to near-zero in March, reaching $846 billion — the highest volume since 2013.

• But there are signs that those cheap home loans are going to only the most creditworthy borrowers. Credit scores at origination ticked up sharply.

• Debt delinquency rates dropped across credit categories. The New York Fed said that was “likely reflecting the impact of government stimulus programs and various forbearance options for troubled borrowers.”

The Nevada Legislature has approved a bill mandating health protections for hundreds of thousands of workers in the hospitality industry while providing most of the state’s businesses with a liability shield against coronavirus-related lawsuits.

The state’s powerful culinary union pushed for the worker protections as part of what it called the Adolfo Fernandez Bill, named for a utility porter on the Las Vegas Strip who died after contracting Covid-19.

Gov. Steve Sisolak, a Democrat, is expected to sign the measure, which was approved Wednesday night. Both houses of the Legislature are controlled by Democrats.

In the counties that include Las Vegas and Reno, the bill requires daily temperature screenings of hospitality workers, coronavirus tests for those returning to work and regular cleaning of high-touch surfaces. The legislation bars employers from forcing workers with symptoms from reporting to the job while awaiting test results and offers paid time off to those testing positive.

At the same time, the bill shields businesses in most of the state’s industries from potential lawsuits by customers who become ill with Covid-19.

State Senator Yvanna Cancela, a co-majority whip, said the measure “finds a balance” in offering health protection to workers while assuring employers that “there can be certainty around which you can operate.”

But progressive groups criticized the liability provisions, saying they offered a shield to employers not bound by the safety mandates that apply to casino and hotel workers.

Hugh Baran, a staff lawyer with the National Employment Law Project, a worker advocacy group, said the liability provisions would grant “legal immunity to employers who fail to protect their workers.”

The coronavirus pandemic wiped out a large portion of ViacomCBS’s advertising business and its box-office take in the second quarter, the company reported Thursday. ViacomCBS owns CBS, Nickelodeon, MTV, Showtime and the Paramount film studios. The company’s ad revenue in the United States fell 24 percent to $1.7 billion, and its theatrical business dropped a staggering 98 percent from the same time last year, to $3 million. Total sales fell 12 percent to $6.2 billion, and profit was halved to $478 million.

• The company’s only bright spot, as at other media conglomerates, was its streaming business, which includes CBS All Access, Showtime and the free, ad-supported platform Pluto. CBS and Showtime now have 16.2 million subscribers. (The company refuses to break out figures for each platform.) Revenue jumped 25 percent to $489 million. The company also touted a new plan to add more content to CBS All Access that will include 3,500 episodes from BET, Comedy Central, MTV and others.

• As the so-called streaming wars took off two years ago, ViacomCBS said it would play the arms dealer and license its content to top bidders. But recently, Robert M. Bakish, the chief executive, announced a new strategy to bolster its own streaming service. That raised a question: Would the company stop licensing its shows and films to other streamers in an effort to shore up its own offering? Mr. Bakish has said it’s not an either-or proposition and the company could still do both.

• Quarterly results help put its streaming ambitions into perspective: ViacomCBS generates far more revenue from content licensing than streaming. That’s because the company produces a lot of the shows seen on streamers like Netflix, Amazon and Hulu. It recently licensed the well-known “South Park” franchise to HBO Max for about $500 million, making that single deal worth more than an entire quarter’s streaming revenue. Total content licensing sales for the period topped $1.9 billion.

• Elsewhere, CBS saw sales drop more than a fifth to $2.3 billion and profit drop more than a third to $392 million largely because of weaker advertising.

• On the earnings call following the report, Mr. Bakish said he expected the decline in advertising to start to moderate in the current quarter, a sign that marketers were looking to open up their wallets a bit more.

• The company also announced that Stephen Colbert and James Corden, its late night hosts, would be returning to the studio next week — but without a studio audience.

It didn’t just seem like everyone spent their lockdown playing Animal Crossing — they really were.

Nintendo, the creator of the game for its Switch consoles, reported on Thursday a staggering 541 percent increase in quarterly profit from the previous year.

Behind that number were 10.6 million sales of Animal Crossing: New Horizons, pushing the Japanese gaming company’s net income to 106.5 billion yen ($1 billion), and the company said “sales of this title continue to be strong with no loss of momentum.” Since it was released, there have been more than 22 million sales of the game, making it the most popular Animal Crossing game by a big margin. The only Nintendo Switch game that has ever sold more is Mario Kart 8 Deluxe.

Animal Crossing has brought in many new customers to Nintendo. Some of those new customers needed to buy a Switch console, and the company said the pandemic had made it difficult to get some of the parts needed to keep up with demand. In some regions there are still shortages. Still, in the second quarter, the Nintendo Switch platform accounted for about 340 billion yen in sales, more than double last year.

Another big-selling game was The Isle of Armor, an expansion of the Pokémon Sword and Shield game. Nintendo said it plans to sell another expansion of the game, The Crown Tundra, in the fall.

The government reported on Thursday that nearly 1.2 million workers filed new claims for state unemployment benefits last week. It was the lowest weekly total since March, but signaled the continuing damage that the pandemic is inflicting on the labor market.

An additional 656,000 claims were filed by freelancers, part-time workers and others who do not qualify for regular state jobless aid but are eligible for benefits under a separate federal unemployment insurance program, the Labor Department announced on Thursday. Unlike the state figures, that number is not seasonally adjusted.

“Over all, the data was modestly better than we expected, a surprising improvement,” said Kathy Bostjancic, chief U.S. financial economist at Oxford Economics. There were declines across nearly all the states, even those where there is a resurgence of the virus.

But jobless claims “remain at alarmingly high levels,” she said, and the stubbornly high number of people collecting unemployment — estimated by economists at 30 million — suggests that “temporary layoffs are becoming permanent.”

Although the number of new claims is down from the stratospheric levels reached in the early days of the pandemic, the million-plus tallies that have continued for 20 weeks in a row are still extraordinarily high by historical standards.

And now that emergency federal supplemental benefits have expired, the newest entrants to join the ranks of unemployed will not be receiving the extra $600 a week that has helped jobless workers pay bills through the spring and early summer.

Gannett and Tribune Publishing, two of the last remaining publicly traded newspaper chains, both reported impressive subscription growth alongside plummeting advertising sales during the second quarter of this year, which was dominated by the coronavirus pandemic.

Gannett — the largest newspaper chain in the country, publishing USA Today and more than 250 other dailies — saw a 31 percent increase in new digital subscriptions compared to the same quarter last year, it said Thursday morning. It has a total 927,000 digital subscribers.

But as marketers responded to the coronavirus and the economic slowdown it prompted by pulling back on ad spending, Gannett suffered, with print advertising falling 45 percent and digital advertising dropping 27 percent.

Gannett placed furloughs on most of its roughly 20,000 employees in response to the virus and, along with the related dip in travel expenses, this led to $125 million in savings during the quarter.

Absolute comparisons with a year ago are misleading, as an earlier, smaller version of Gannett merged last fall with the parent company of GateHouse Media to create the present, much larger version of Gannett. At the time of that deal, executive said it would result in $300 million in annual cost savings by the next year. On Thursday, Mike Reed, the chief executive, said in a statement that Gannett was on track to achieving that goal.

Though publicly traded and owned, Gannett is controlled under a deal that lasts through next year by a private equity firm, Fortress Investment Group, which is itself owned by the Japanese conglomerate SoftBank.

Tribune Publishing, owner of The Chicago Tribune, The Baltimore Sun and roughly 20 other newspapers, posted similar results. Digital subscribers rose 40 percent compared with the same quarter last year, to 419,000, while overall ad sales plunged 49 percent.

The growth in subscribers “marks our highest single quarter of digital subscriber acquisition since we launched our digital subscription product line many years ago,” said Terry Jimenez, the chief executive and president. “We are pleased that these new readers recognize the value in our product.”

The company also reported a 24 percent decline in operating expenses, reflecting efforts to reduce costs. Tribune Publishing journalists were offered buyouts at the beginning of the year, and once the pandemic arrived many were subject to furloughs or permanent pay cuts.

The hedge fund Alden Global Capital has a 32 percent stake in Tribune Publishing and three of seven board seats.

While the elevated levels of jobless claims show that businesses are still struggling to keep employees on the payroll, there has been some pickup in hiring. After drooping, job postings at the online jobs site ZipRecruiter rose by 7.4 percent in July and are still climbing, said Julia Pollak, the company’s labor economist.

But the latest economic data is mixed, she cautioned. Surveys from the Institute for Supply Management, for instance, showed that business activity in service industries expanded last month, but that the employment index declined, an indication that many companies are still not bringing back workers.

There were steep increases in joblessness related to the performing arts and other live events in July, Ms. Pollak said.

And announcements of impending layoffs continue to pile in. Ms. Pollak has been tracking plant closings and layoffs that the government requires to be announced in advance. “They are showing that new layoffs are still taking place at an alarming rate,” she said. “Plenty of layoffs are scheduled for August, September and October, as well.”

“Many companies are realizing now that the effects will be much longer than expected,” she said.

• Facebook will allow its employees to work from home until at least July 2021, the social media giant confirmed on Friday, and will give employees an additional $1,000 to support continued remote work. The company believed in the importance of in-person communication and had few remote workers before the pandemic, but Mark Zuckerberg, the chief executive, has said as many as half of Facebook’s employees will be permanently remote within the next decade.

• Snap, the company behind the popular social media app Snapchat, is planning a major push to register first-time voters within its app and to guide them through the ballot process ahead of the election on Nov. 3. Beginning in early September, the app will introduce a new tool in partnership with TurboVote that allows users to register from within their Snap account with a streamlined set of prompts.

• More than half of Americans who flew in the past year are not ready to do so again, according to a new survey, underscoring the difficulty airlines face in convincing people it is safe for them to get back on planes. Younger adults are more willing to travel; only a third of those between the ages of 18 and 34 expressed discomfort with the idea. But older adults, who tend to have more time and money to travel, are far more reluctant. Among those 55 or older, 69 percent said they would not be comfortable taking a flight.