…and Apple opens its payment gates
| Lookin' for the sushi buffet (View Pictures/Getty Images) | |
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Yesterday's Market Moves | | Dow Jones
37,267 (-0.25%) | S&P 500
4,739 (-0.56%) | Nasdaq
14,856 (-0.59%) | Bitcoin
$42,686 (-1.03%) |
| Dow Jones
37,267 (-0.25%) | S&P 500
4,739 (-0.56%) | Nasdaq
14,856 (-0.59%) | Bitcoin
$42,686 (-1.03%) |
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Hey Snackers, Be prepared to stop: the US Federal Highway Administration told traffic-sign writers to cut it out with all the jokes (picture: "Get your head out of your apps"), giving 'em two years to stop being funny. Till then, use caution: distracting puns ahead. Stocks fell yesterday, with Fed officials suggesting that rates might not come down as quickly (or as soon) as investors had hoped. Meanwhile, new data showed that US retail sales were up last month to close out the holiday shopping szn. | |
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Google's layoffs rankle employees as Big Tech jobs lose some of their cushy cachet | Great frugally Googley… For the second January in a row, Google is kicking the year off with major layoffs. The search giant — known for its employee-centric biz culture with office fitness centers, game rooms, and massages — is laying off hundreds of workers in ad sales and over at YouTube. The news comes a week after Google laid off ~1K staffers without much explanation, and a year after it cut 12K jobs. Employees have responded harshly, calling the cuts "needless" and saying the company's culture has cratered. Muted: CEO Sundar Pichai referred to last year's layoffs as one of the worst moments in Google's history, acknowledging they tanked morale. Pichai reportedly still hasn't addressed the recent layoffs internally. Efficiency 2.0: Tech industry layoffs totaled 260K+ last year, with macro headwinds and pandemic overhiring often cited as reasons. So far this year, tech cos including Amazon and Discord have cut ~7.5K employees as the quest for "efficiency" continues and companies incorporate more AI.
Less sun's hitting the Valley… The tech industry is known for high-paying jobs with cushy perks (pet insurance, anyone?). But layoffs, RTO pushes, and office-stapler cuts (yes, really) during tech's "year of efficiency" have caused tech jobs to slide down the desirability scale. Google has fallen 18 spots to #26 on Glassdoor's "best places to work" list. Meta and Zoom didn't place, and 10 fewer tech companies made the list overall than last year. |  | THE TAKEAWAY |
| Cultural decline can be costly too… While Google's layoffs may lower its costs, they also dent worker morale: 74% of employees who survive layoff rounds see declines in their productivity. And with deep-pocketed rivals like OpenAI looking to poach talent, Google is already trying to retain top staff as worker satisfaction falls. It recently started doling out millions worth of restricted stock to some employees. | |
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The App Store will allow outside payment options as antitrust pressure mounts | Far from the tree… Apple's US App Store will allow outside payments, letting developers link out to non-Apple payment platforms. It's a historic win for developers and the result of a years-long courtroom battle royale against "Fortnite" maker Epic Games. Quick refresher: in 2020 "Fortnite" got booted from Apple's and Google's app stores after it directed players to its own discounted payment system to skirt the "app tax" (a 15-to-30% fee that app-store owners skim off purchases). In April, 9 of 10 of Epic's claims were decided in Apple's favor. One big caveat: The ruling said Apple can't bar developers from steering users to off-app purchasing pages. Apple tried to appeal to SCOTUS but… The Supreme Court refused to consider the appeal, so yesterday Apple updated its App Store policies to show developers how they can link to outside payments.
The "app tax" ain't dead… Even for payments made on non-Apple platforms, the iPhone maker will try to take a cut. App developers will still owe Apple a 27% slice (or a 12% cut if they're part of Apple's small-biz program). On top of that, developers may have to pay fees to third-party payment processors like Shopify and PayPal. Epic's CEO said that could raise developers' costs (and added that Epic would contest "Apple's bad-faith compliance plan" in court). | | THE TAKEAWAY |
| The gated garden is opening… By allowing payments outside its airtight ecosystem, Apple is potentially putting billions of $$ in app revenue on the line. It's not the only one: Google lost its courtroom battle against Epic last month and could be forced to change its Play Store rules. Pressure's only building: European antitrust regulators have two cases teed up against Apple. | |
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What else we're Snackin' | Alaskary: Four Alaska Airlines passengers are suing the carrier and Boeing after a midair blowout. Investors worry that officials will discover more 737 Max problems (meanwhile, Boeing's stock has sunk). ModelFreeze: Tesla drivers in the Midwest are facing subzero temps that are lowering their cars' ranges while upping their charge times. Experts say more EV infrastructure is needed to counter extreme cold. NotUniq: Fast-fashion chain Uniqlo sued rival Shein, alleging the biz sold knockoffs of its viral shoulder bag. Brands and indie designers have accused Shein — which is said to be prepping to IPO — of stealing designs. NightIn: Dave & Buster's and Topgolf are adding deals as RTO-sapped customers bail on midweek ballin'. The "eatertainment" industry had benefited from higher prices, but experts say consumers might've had their fill. CNN++: CNN's CEO said the biz is rolling all its newsgathering into one unit and may build a subscription service. The company faces profit peril as cordcutters shift their eyes and $$ from cable to streaming.
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Snack Fact Of the Day | Some crustaceans can make silk | | |
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Thursday | Initial jobless claims and housing starts Earnings expected from Birkenstock, J.B. Hunt, KeyBank, and Taiwan Semiconductor
Authors of this Snacks own shares of: Alaska Airlines, Alphabet, Amazon, Apple, Shopify, and Tesla | |
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Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate... See more | |
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