The daily business briefing: June 24, 2022
The FDA orders Juul to stop selling e-cigarettes in the U.S., Netflix lays off 300 more workers after subscriber losses, and more
FDA orders Juul to pull e-cigarettes from U.S. market
The Food and Drug Administration on Thursday ordered Juul Labs to stop selling e-cigarettes in the United States, part of an ongoing effort to reduce nicotine-related deaths from smoking and vaping. Most of Juul's sales are in the U.S., so the decision could be devastating for the company. Juul said it disagreed with the ruling and would seek a stay. "We remain committed to doing all in our power to continue serving the millions of American adult smokers who have successfully used our products to transition away from combustible cigarettes," the company said. The once booming company stopped selling sweet and fruity flavored e-cigarettes the U.S. market and limited its marketing after being accused of driving a youth vaping crisis.
Netflix lays off 300 more employees after subscriber losses
Netflix confirmed Thursday it has laid off another 300 employees, or about 3 percent of the company. "While we continue to invest significantly in the business, we made these adjustments so that our costs are growing in line with our slower revenue growth," Netflix said in a statement. Netflix laid off about 150 workers in May, again citing slowing revenue growth. The layoffs followed an April announcement that the streaming video company lost 200,000 subscribers in the first quarter of the year, the first such loss in 10 years. Analysts had expected a modest gain. Netflix cited a variety of factors, including heavy competition from rival streamers like Disney+, as well as password sharing. Netflix is cracking down on sharing and adding a cheaper, ad-supported option to lure more subscribers.
European Union grants Ukraine candidate status
European leaders on Thursday formally designated Ukraine and Moldva as candidates to join the European Union, a big early step in a years-long process toward admitting the countries into the 27-nation trading bloc. Ukraine has called for quick action on its application as it struggles to defend itself against a Russian invasion that has battered its military, its population, and its economy. The backing of EU leaders "is a signal to Moscow that Ukraine, and also other countries from the former Soviet Union, cannot belong to the Russian spheres of influence," Ukraine's ambassador to the EU, Vsevolod Chentsov, told Reuters.
Stock futures rise as Wall Street looks to snap weeks-long losing streak
U.S. stock futures rose early Friday and all three of the main U.S. indexes remain on track to snap their three-week losing streaks. Futures tied to the Dow Jones Industrial Average and the S&P 500 were up 0.8 percent and 0.9 percent, respectively, at 6:30 a.m. ET. Nasdaq futures were up 1 percent. The Dow and the S&P 500 gained 0.6 percent and 1 percent, respectively, on Thursday. The tech-heavy Nasdaq jumped 1.6 percent. The S&P 500 was up 3.3 percent for the week after Thursday's rally, a little more than the Dow and a little less than the Nasdaq. Analysts warn that volatility will continue as long as uncertainty continues about a possible recession.
Nike fully withdrawing from Russia
Nike said Thursday it will shut down completely in Russia after suspending operations three months ago in response to Moscow's invasion of Ukraine. "Nike has made the decision to leave the Russian marketplace," the company said. "Our priority is to ensure we are fully supporting our employees while we responsibly scale down our operations over the coming months." Last month, Russian newspaper Vedomosti reported that the sportswear giant had ended its relationship with its biggest franchisee in Russia, Inventive Retail Group. Nike's move came weeks after two other iconic American companies, McDonald's and Starbucks, announced that they were fully withdrawing from Russia after earlier suspending operations there. Sports apparel rivals Puma, Reebok, and Adidas also suspended their Russia operations.