Posts tagged with "CNBC"

Nikola founder Trevor Milton charged with fraud for lying about ‘nearly all aspects’ of EV business

July 30, 2021

Trevor Milton, the founder and former executive chairman of electric vehicle company Nikola, has been charged with two counts of securities fraud and one count of wire fraud by a federal grand jury. Milton has been accused of lying about “nearly all aspects of the business” to boost Nikola’s stock, reports Engadget.

The indictment alleges that Milton made it seem Nikola was much further along than it actually was in terms of having fully functional EVs. It asserts he had a hand in creating a video that made it seem as if a Nikola One prototype was able to move by itself when it was actually rolling down a slope.

According to Engadget, Milton falsely claimed the company had “billions and billions and billions and billions” of dollars’ worth of preorder reservations and that the company was producing its own hydrogen at four times less than market rates, according to the indictment.

He’s also accused of falsely claiming that Nikola had developed “game-changing” battery technology, that it was developing and making several key components for its EVs in-house and that “the total cost of ownership of Nikola’s trucks was 20% to 30% below that of diesel vehicles.”

Prosecutors claim Milton, who resigned in September in the face of a Securities and Exchange Commission (SEC) probe, targeted and misled amateur investors (or “retail investors”). According to the indictment, some of those investors lost hundreds of thousands of dollars.

At Nikola’s peak valuation, Milton held around $8.5 billion worth of stock, as CNBC has noted. The grand jury argues that Milton should surrender property “traceable to the commission of said offenses.” That could include the over $1 billion Milton made when the company went public in June 2020.

The SEC also filed civil securities fraud charges against Milton on Thursday, July 29. The agency asked a district court to force Milton to forfeit “ill-gotten gains” and to pay a fine. It also called for a lifetime ban on Milton serving as an officer at a company that issues securities.

Research contact: @engadget

Cleveland’s baseball team will now be known as the Guardians

July 26, 2021

Cleveland’s Major League Baseball team will no longer be known as the Indians. Instead, the club wall call itself the Guardians, the franchise announced on Friday, July 23—caving to pressure to drop the racially offensive name it has been known as for more than a century, CNBC reports.

The change was announced in a video on Twitter narrated by Oscar winner Tom Hanks, who worked in Cleveland early in his acting career and starred in the women’s baseball movie “A League of Their Own.”

The name Guardians is a reference to well-known art deco statues located on the Lorain-Carnegie Bridge, which spans the Cuyahoga River and connects downtown Cleveland to the city’s trendy Ohio City neighborhood. Those statues are known as the “Guardians of Traffic.”

In its Friday post, the team gave a further explanation for the choice of the name Guardians: “To protect, to keep watch, to defend. For Clevelanders, this is a way of life. We fight together for what we believe in. And if we get knocked down, we pick each other right back up and keep fighting. We’re resilient, hard-working, and loyal — to this city and to each other. That’s what it means to be Cleveland Guardians.”

The franchise said it surveyed more than 40,000 fans about potential names and conducted more than 140 hours of interviews with supporters, front office members and community leaders in northeast Ohio.

“Our fans are at the heart of this decision. We heard this name often from our fans as a top contender because of it’s connection to the iconic Cleveland landmark,” the team statement said.

The announcement did not say when the new name will be effective. However, MLB.com reported that will happen for next season. The franchise currently is in second place in the American League Central.

According to CNBC, the NFL’s Washington football team last year dropped its former name, the Redskins, which was decried as demeaning to Native Americans, as corporate backlash intensified. The franchise adopted Washington Football Team on a temporary basis, playing last season under that name. It will continue to be known as the Washington Football Team for the 2021 campaign.

The Washington Post reported earlier this month that a new name and logo for the NFL team will be announced in early 2022.

Research contact: @CNBC

Rudy Giuliani suspended from practicing law in New York over ‘Stop the Steal’ messaging

June 25, 2021

A New York court on Thursday suspended Rudy Giuliani from practicing law in New York State because of his “false and misleading statements” about the election loss of former President Donald Trump, his client.

According to a report by CNBC, “The suspension is a stunning blow to Giuliani, the former New York City mayor who previously served as a top Justice Department official, and the head prosecutor for the federal Southern District of New York.”

Indeed, The Daily Beast reports, Giuliani and Trump have since last November made false claims about the legitimacy of the election of President Joe Biden–—leading a “Stop the Steal” movement among Republicans nationwide.

The New York Supreme Court Appellate Division’s grievance committee filed a summary of disciplinary proceedings on Thursday, June 24, outlining multiple “uncontroverted” instances of professional misconduct.

“[W]e conclude that there is uncontroverted evidence that respondent communicated demonstrably false and misleading statements to courts, lawmakers and the public at large in his capacity as lawyer for former President Donald J. Trump and the Trump campaign in connection with Trump’s failed effort at reelection in 2020,” the five-member Attorney Grievance Committee said in its filing.

.“These false statements were made to improperly bolster respondent’s narrative that due to widespread voter fraud, victory in the 2020 United States presidential election was stolen from his client. We conclude that respondent’s conduct immediately threatens the public interest and warrants interim suspension from the practice of law, pending further proceedings before the Attorney Grievance Committee.”

All licensed attorneys in New York must abide by professional rules of conduct, which are upheld by judicial departments of the Supreme Court’s Appellate Divisions.

In its 33-page ruling, the grievance committee outlines—and then systematically debunks—a long list of statements Giuliani made during his months-long crusade to overturn Joe Biden’s election win, The Daily Beast notes.

For example, Giuliani claimed in several interviews and state legislature hearings that more absentee ballots came in during the election in Pennsylvania than were sent out before the election—a statement that the committee easily proved was “simply untrue.”

In response, Giuliani told the committee that an unidentified member of his “team” had “inadvertently” taken misleading information from Pennsylvania’s website.

In other examples, Giuliani repeatedly claimed that dead people voted in Georgia, at times quantifying it as 800;  6,000; or 10,515 dead people. (In truth, officials were investigating two potential cases of votes being cast in the name of dead people.) In Pennsylvania, he put the number at 8,021 dead people and then 30,000 dead people.

Public records “unequivocally show that respondent’s statement is false,” the committee said. (Giuliani argued during disciplinary proceedings that he didn’t know the statements were false but he failed to provide “a scintilla of evidence” to support his claim, the filing says.)

The probe was initiated in January, in the wake of the Capitol riot, when State Senate Judiciary Committee Chair Brad Hoylman urged the grievance committee to investigate Giuliani’s role.

“I will be filing a formal complaint with the Appellate Division of the Unified Court System asking them to consider revoking Rudy Giuliani’s license to practice law in New York due to rampant and egregious violations of the Rules of Professional Conduct related to his participation in a scheme to unlawfully overturn the results of a free and fair election and his complicity in inflaming a violent coup attempt in our seat of federal government,” Holyman said.

Separately, the New York State Bar Association launched an investigation into former President Donald Trump’s personal lawyer after receiving hundreds of complaints about his role in the Capitol riot.

In a statement in January, NYSBA blamed the mob on Trump’s repeated false claims about the results of the 2020 election—but notes that the “president did not act alone.”

“Hours before the angry mob stormed the Capitol walls, Trump’s personal attorney, Rudolph Giuliani, addressed a crowd of thousands at the White House, reiterating baseless claims of widespread election fraud in the presidential election and the Georgia U.S. Senate runoffs,” the association, which counts 24,000 lawyers among its members, said.

While the grievance committee said it wanted to immediately boot Giuliani from practicing law, it said the suspension was only temporary pending a full formal disciplinary proceeding. Giuliani will be able to appeal to decision.

esearch contact: @thedailybeast

Wingstop launches a virtual restaurant selling chicken thighs as wing supplies tighten

June 22, 2021

With chicken wings in short supply and prices rising, the Dallas-based restaurant chain Wingstop said on June 21 that it is “hacking” its own brand by launching Thighstop, a virtual restaurant that will serve up crispy chicken thighs, reports CNBC.

Like the original Wingstop, customers can pick one of 11 flavors and opt for either a bone-in or boneless thigh. The new brand will be available for delivery or carryout in 1,400 locations nationwide via DoorDash or on Thighstop.com, the company said.

Chicken wings grew in popularity during the pandemic for both dine-in and takeout customers. But diners are now staring down both price hikes and tight supplies. Port delays and labor shortages have resulted in scarce supplies for a range of goods from computer chips to chlorine tablets.

The National Chicken Council hasn’t called the tightening supply of chicken a “shortage,” but told CNBC via a recent email that the number of broiler chickens raised for meat fell 4% in the first quarter, and pounds produced were down 3% year over year.

Production started  picking up in April, the council said—but as of last week, chicken wing prices were $2.72 per pound on average, according to the U.S. Department of Agriculture. That’s nearly 20 cents higher than prices during the same week last year.

Key chicken-producing regions were hit with a major winter storm in Texas right after the Super Bowl, impacting availability, said Tom Super, the council’s senior vice president of communications. “Even small gaps in the supply of wings can cause big fluctuations in price,” he said.

In the spring, Wingstop CEO Charlie Morrison said the company planned ahead and would be able to meet its demand. Morrison is positioning the new strategy as an opportunity: “Wingstop pioneered the concept of chicken wings as a center-of-the-plate item. Although Thighstop is in its infancy, we’ve been exploring bone-in and boneless thighs as center-of-the-plate options for some time now as a way to offer fans new ways to enjoy Wingstop’s bold, distinctive and craveable flavors,” he said in a statement.

Research contact: @CNBC

Americans eager to begin celebrating Juneteenth as a federal holiday on Saturday

June 18, 2021

On Saturday, June 19, Americans will mark Juneteenth National Independence Day as their 12th legal public holiday—and the first new one since Martin Luther King Jr. Day was signed into law in 1983 by then-President Ronald Reagan, CNBC reports.

President Joe Biden was set to sign a bill on Thursday  establishing Juneteenth, the date marking the end of slavery in the United States, as a federal holiday. The 3:30 p.m. (EDT) signing event at the White House came two days before Juneteenth itself, which falls on June 19 each year.

Juneteenth marks the date that the last enslaved African Americans were granted their freedom. On that day in 1865, Union soldiers led by General Gordon Granger arrived in the coastal city of Galveston, Texas, to deliver General Order No. 3, officially ending slavery in the state.

CNBC notes that the final act of liberation came months after the Confederate army’s surrender ended the Civil War, and more than two years after President Abraham Lincoln issued the Emancipation Proclamation.

The holiday legislation passed this week with overwhelming support in both chambers of Congress. The Senate approved the bill unanimously  on June 15 and the House passed it in a 415-14 vote.

The Juneteenth legislation was sponsored in the Senate by Edward Markey (D-Massachusetts). The House version, sponsored by Representative Sheila Jackson Lee (D-Texas) was co-sponsored by 166 lawmakers.

The only votes against the bill came from Republicans. On the House floor before the vote, some GOP lawmakers complained about the name of the holiday, and others expressed concern about the cost of giving the federal workforce another day off. Some also railed against Democrats for pushing the bill to a vote without first allowing committees to examine the legislation and offer amendments.

Still, most House Republicans, even those who objected to parts of the bill, ended up voting for it.

The 14 no votes were entered into the record by the following Representatives: p. Mo Brooks (R-Alabam, Andy Biggs ( R-Arizona), Scott DesJarlais (R-Tennessee). Tom Tiffany (R-Wisconsin),  Doug LaMalfa (R-California), Mike Rogers (R-Alabama), Ralph Norman (R-South Carolina), Chip Roy (R-Texas), Paul Gosar (R-Arizona), Tom McClintock (R-California), Matt Rosendale (R-Montana), Ronny Jackson (R-Texas), Thomas Massie (R-Kentucky), and Andrew Clyde (R-Georgia).

Research contact: @CNBC

Why golf club-maker Callaway is moving beyond the fairway

June 14, 2021

With a record number of new golfers teeing off in 202 Carlsbad, California-based Callaway—a manufacturer and marketer of golf balls, clubs, bags and apparel—has been thriving and thinking about “big green” beyond the fairways on which its products usually are seen, CNBC reports.

Callaway announced in May first-quarter net revenue of $652 million, a 47% increase from a year earlier.

“Callaway pre-Covid was already the number one brand in sticks, I call it, which is putters, drivers and irons,” Jefferies analyst Randy Konik told CNBC. “They were outpacing industry growth and they were also number two in balls behind Titleist.”

The 40-year-old company also has made moves to expand. In March, the company completed its merger with golf entertainment business Topgolf, which combines virtual driving ranges with food and cocktails.

“This is a transformative merger. It creates an entity that doesn’t really replicate anything that currently exists, with the leader in golf equipment merging with the leader in golf entertainment,” said Callaway CEO Chip Brewer.

Last year, almost 37 million players teed off at a golf course or participated in an off-course activity like a driving range. Nearly one-third of the U.S. population watched, read about,or played golf in 2020.

But with movie theaters, travel, and concerts expected to rebound, CNBC questions: “Will golf club-makers like Callaway and its rival Acushnet be able to maintain their momentum?” Only time will tell.

Research contact: @CNBC

Chipotle raises wages amid expansion plans, as companies compete for workers

May 11, 2021

The fast-casual food chain Chipotle Mexican Grill announced on May 10 that it is raising wages for workers amid a big hiring push based on expansion plans.

The move comes as restaurants nationwide debate worker availability and pay levels, The Washington Post reports.

 The company said it plans to hire 20,000 new workers and open 200 new locations this year. In line with those ambitions, Chipotle will institute a wage increase of about $2 an hour per employee—meaning that salaries for its crew will average $15 an hour by the end of June, although entry-level wages at the company will remain at $11 an hour.

The company joins the ranks of many others offering incentives and higher pay to lure workers back into the workforce after the pandemic year, including Costco, Target, and Walmart, among others.

The Post notes that many businesses, particularly those offering lower-wage, hourly positions, like restaurants, have complained that they are having trouble finding workers—even with high levels of unemployment—which has raised concerns that a worker shortage could hamper the economic recovery.

Job growth in April came in well-below expectations, with only 266,000 jobs added as the country seeks to regain the more than 8 million more jobs it had in February 2020. The Bureau of Labor Statistics said that the wage increases found in the survey reflected the increased demand for labor.

Chipotle CEO Brian Niccol told CNBC on Monday that the current labor market was among the tightest he’d ever seen in his career—saying the company was hoping to highlight the appeal of the brand and the employee growth potential. Workers also are being offered a $200 referral bonus for employees and a $750 referral bonus for managers.

 “We are sharing with people that it’s not just a job right now, but it’s actually a job that can lead to a meaningful career,” Niccol told the outlet. “I’m glad that we’re a company that’s got the growth, and frankly the strength, to increase wages and start talking more about how the job leads to your future growth with our company.”

In Washington, D.C., lawmakers have seized on the matter for political purposes, with Republicans complaining that the labor supply issues are the direct result of overgenerous stimulus measures passed by Democrats earlier this year.

But labor economists, worker advocates and some business groups say the issue is far more complicated, with many workers forced to juggle child-care with many schools yet to fully reopen, lingering questions about workplace safety for vaccine-avoiders and others with complicated health considerations, and many workers having moved on or rethinking career plans.

“Chipotle is committed to providing industry-leading benefits and accelerated growth opportunities; and we hope to attract even more talent by showcasing the potential income that can be achieved in a few short years,” Marissa Andrada, a company executive said in a statement Monday. “We’re looking for people who are authentic, passionate and want to help cultivate a better world through real food and real personal development.”

CFO Jack Hartung told investors earlier this year that raising its salary average to $15 an hour would cause menu prices to spike at least 2%  to 3%. The company did not respond to an immediate question from the Post about whether it would raise its menu prices to pay for the voluntary wage hike.

Research contact: @washingtonpost

Pfizer’s new at-home pill to treat COVID could be available by the end of this year

April 28, 2021

Pfizer’s experimental oral drug to treat COVID-19 at the first sign of illness could be available by the end of the year, CEO Albert Bourla told CNBC on Tuesday, April 27.

In March, the company—which developed the first FDA-authorized COVID-19 vaccine in the United States in cooperation with German drugmaker BioNTech—began an early-stage clinical trial testing a new antiviral therapy for COVID. The drug is part of a class of medicines called protease inhibitors and works by inhibiting an enzyme that the virus needs to replicate in human cells.

Protease inhibitors are used to treat other viral pathogens, such as HIV and hepatitis C.

If clinical trials go well and the Food and Drug Administration approves it, the drug could be distributed nationwide by year-end, Bourla told CNBC’s “Squawk Box.”

Health experts say the drug, taken by mouth, could be a gamechanger because people newly infected with the virus could use it outside of hospitals. Researchers hope the medication will keep the disease from progressing and prevent hospital trips.

In addition to the drug, Pfizer is still testing its vaccine in 6-month to 11-year-old children. Vaccinating children is crucial to ending the pandemic, public health officials and infectious disease experts say.

Earlier this month, the company asked the FDA to expand its vaccine authorization to adolescents ages 12 to 15 after the shot was found to be 100% effective in a study.

Bourla told CNBC on Tuesday he is “very optimistic” that the FDA will approve the use of the shot in adolescents.

Research contact: @CNBC

Procter & Gamble will raise prices in September to fight higher commodity costs

April 21, 2021

Stock up on Tampax, Pampers, and Always Discreet now: Procter & Gamble has announced that it will hike prices on baby care, feminine care, and adult incontinence products in September, in response to higher commodity costs, CNBC reports.

The consumer giant joins a host of other companies—among them, rival Kimberly-Clark and beverage giant Coca-Cola, which are raising prices to protect their profit margins.

The companies are betting consumers will be willing to pay more for the brand version instead of opting for a cheaper private label. However, that outcome depends on the economic recovery from the coronavirus pandemic and how many consumers will have the cash to spare.

P&G said its price increases will vary by brand but will be in the range of mid-to-high single digits, CNBC notes.

“This is one of the bigger increases in commodity costs that we’ve seen over the period of time that I’ve been involved with this, which is a fairly long period of time,” Chief Operating Officer Jon Moeller told analysts.

After the price increases go into effect, P&G is planning to hold onto market share by trying to increase consumers’ perception of the value of its products and introducing new or upgraded items.

Moeller said on a press call that the company is assessing the raw material costs and foreign exchange impacts on other categories as well, which could mean more price increases down the line. For example, Kimberly-Clark raised prices on its Scott toilet paper due to rising commodity costs; but P&G’s Charmin products have not been impacted yet.

Research contact: @CNBC