The daily business briefing: August 13, 2021
Disney smashes expectations, coffee prices rise due to extreme weather, and more
Disney beats expectations thanks to streaming service, theme parks
Walt Disney Co. on Thursday posted earnings for the last quarter that beat expectations, propelled by the success of its streaming service, as well as a reopening of its theme parks. The company's total quarterly revenue was $17 billion, up 45 percent from the same period last year. Disney added 12 million subscribers to its Disney+ streaming service, a pace of growth not seen by its rivals. Netflix, for comparison, added just 1.5 million subscribers in the same period. Disney's parks and consumer products division turned a profit for the first time since the start of the pandemic thanks to the reopening of venues in the U.S., France, and China. Shares for the company rose 5 percent in after-hours trading.
Coffee prices rising amid Brazil extreme weather, global turmoil
Coffee futures have been trading at seven-year highs since late July, buoyed by extreme weather events in Brazil, months of protests in Colombia, a lack of shipping containers in Vietnam, and other global turmoil and pandemic-related export bottlenecks. Smaller coffee roasters and retailers are deciding whether to raise prices, while coffee giants like Starbucks and Nestlé have enough coffee bean supply in storage or locked in that they won't face rising costs for more than a year. The big wild card is Brazil, the world's largest coffee producer, which saw damage to its coffee trees during unusual below-freezing weather in July and is now entering its wildfire season after a historically bad drought. If Brazilian farmers have to cut down damaged trees after this year's harvest, it will take years for Brazil's coffee exports to recover, and even Starbucks will likely have to consider raising prices.
Supreme Court strikes down part of New York eviction moratorium
The Supreme Court issued an emergency order Thursday night that struck down a New York residential eviction moratorium set to expire at the end of August. The court was ruling on a request from a group of landlords who argued that the 2020 law violates their rights. The unsigned order did not identify which justices supported the decision, but the court's three liberal justices — Stephen Breyer, Sonia Sotomayor, and Elena Kagan — dissented. The court's majority noted that other parts of New York's moratorium remain in place, offering some protection to tenants who "suffered a financial hardship" during the pandemic. The Biden administration has issued its own eviction moratorium for much of the country, and that order is also expected to be taken up by the Supreme Court.
Boeing's Starliner space capsule hits more launch delays
Boeing was scheduled to launch its Starliner space capsule to the International Space Station late last month, but now the launch could be delayed for several months as the aerospace giant fixes a dozen valves in the propulsion system that had failed to open as expected during prelaunch checks. Boeing has spent years developing its space capsule, which is supposed to eventually carry astronauts to and from the ISS, and a delay of months would be a significant setback to Boeing's space program. A software error in December 2019 sent the Starliner into the wrong orbit, making it miss the space station. NASA wants two U.S. companies capable of transporting astronauts to the ISS, and right now it has only Elon Musk's SpaceX.
Stock futures edge higher after closing records for Dow, S&P
U.S. stock futures climbed higher Friday morning, buoyed by fresh closing records for the Dow Jones Industrial Average and the S&P 500. On Thursday, both indexes marked their third straight day of closing at record highs. A drop in weekly jobless claims, signs of slowing inflation, plus strong corporate earnings reports from companies including Walt Disney and Airbnb, eased investors' concerns as they await July import prices out Friday. Futures for the S&P 500 and the Nasdaq rose by about 0.1 percent hours before the opening bell. Futures for the Dow were up 0.2 percent.