Welcome to the top of February. Right here’s your fast run-down of the enterprise and tech information to know for the week forward, and keep heat. — Charlotte Cowles
What’s Up? (Feb. 21-27)
The house-rental firm seemed to be flying excessive after its splashy initial public offering in December. Then it posted a significant decline in income and an eye-watering $3.9 billion loss final week, in its first earnings report as a publicly traded firm. An enormous chunk of its loss — $2.8 billion — could be chalked as much as stock-based compensation associated to its I.P.O. However the firm additionally faces challenges with disgruntled hosts, who’ve turn into increasingly frustrated with the corporate’s cancellation insurance policies and are looking for to listing their properties elsewhere. Nonetheless, Airbnb beat gross sales expectations, and mentioned it was poised to bounce again as soon as the pandemic eases its chokehold on the journey trade.
Jerome H. Powell, the Federal Reserve chair, testified earlier than Congress final week about plans to bolster the economic system’s restoration. It was scintillating stuff, as standard, and nothing new — he reiterated that the central bank would keep interest rates low and stimulus flowing freely to assist the nation’s comeback for so long as essential. However he additionally put forth one novel idea: that improved little one care assist insurance policies from the federal government had been an “space price ,” and may entice ladies again to the labor market after their historic exodus this previous 12 months.
Exhausting to Swallow
The pinnacle of the consulting agency McKinsey was voted out of his role last week after an investigation into the consulting agency’s involvement within the opioid disaster. Earlier this month, McKinsey agreed to pay 49 states a settlement of virtually $600 million as a result of it helped Purdue Pharma “turbocharge” gross sales of its OxyContin painkillers, even after the drugmaker pleaded guilty to deceptive medical doctors and regulators about OxyContin’s dangers. McKinsey didn’t admit wrongdoing as a part of the settlement, however the proof in opposition to the agency made for fairly dangerous publicity.
What’s Subsequent? (Feb. 28-March 6)
Twitter Makes Strikes
For the primary time in years, Twitter is adding new features to its platform. In a bid to draw extra customers, the corporate introduced plans to introduce a subscription mannequin for unique content material and create communities for particular pursuits. These choices aren’t wildly totally different from these on different social media platforms, however not like its friends, Twitter hardly ever modifications its components and hasn’t put a lot of its vitality towards development. Till now, that’s. The corporate’s chief govt, Jack Dorsey, mentioned that Twitter desires to extend its variety of each day energetic customers by a minimum of 64 p.c, to 315 million, and a minimum of double its annual income over the following three years.
Working It Out
WeWork’s former chief govt, Adam Neumann, is about to receive a $480 million settlement in his drawn-out authorized dispute with SoftBank, a Japanese conglomerate that bailed out the corporate after Mr. Neumann almost drove it out of business in 2019. SoftBank tried to stroll away from the deal after the pandemic worn out demand for co-working areas, however no cube — it’s been locked in a battle with Mr. Neumann ever since. Now, SoftBank has compromised and agreed to purchase half the shares it initially dedicated to. The lawsuit delayed Softbank’s efforts to take WeWork public — no matter it could be price now.
The Struggle for $15
Home Democrats cast forward with the Biden administration’s $1.9 trillion stimulus bundle, which features a measure to bump up the federal minimal wage to $15 an hour by 2025. However a nonpartisan Senate official ruled that the wage increase violated the budgetary rules that govern what could be included within the invoice. These tips are stricter than standard as a result of Democrats are counting on a fast-track course of known as budget reconciliation, which shields the laws from a filibuster within the Senate and permits it to move with out Republican assist. The Senate should decide whether or not the wage provision can keep when it takes up the invoice this week. In associated information, Costco is one step forward, and is raising its workers’ minimum wage to $16 an hour.