The daily business briefing: April 11, 2018
Zuckerberg tells senators Facebook "didn't do enough" to protect privacy, VW prepares to replace CEO Matthias Mueller, and more
Zuckerberg tells senators Facebook 'didn't do enough' to protect privacy
Facebook CEO Mark Zuckerberg repeated his apologies for the social network's mishandling of user data on Monday in testimony to the Senate's Commerce and Judiciary committees. Zuckerberg, wearing a dark suit rather than his customary T-shirt and jeans, said the realization that a Russian agency had pushed fake news, and that data-mining firm Cambridge Analytica had improperly accessed information from 87 million Facebook users, had sparked the company to review how it protects users' privacy. "We didn't do enough to make sure these tools aren't being used for harm," Zuckerberg said. The company's stock, which has been battered by the scandal, rose by 4.5 percent. Zuckerberg testifies again Wednesday before the House Energy and Commerce Committee.
VW preparing to replace CEO who got company through emissions scandal
Volkswagen is poised to replace CEO Matthias Mueller with senior VW executive Herbert Diess, according to numerous media reports on Tuesday. Mueller took over after the German automaker's diesel-emissions cheating scandal erupted in 2015, and he has been credited with putting the company back on track. He has sped up the company's strategy to develop electric vehicles and self-driving cars, and restored strong profits. VW's board, however, is expected to replace Mueller with Diess, VW's brand chief, at a Friday meeting as part of an effort to increase efficiency through changes in the company's management structure.
U.S. stock futures edge down after possible China olive branch sparks gains
The Dow Jones Industrial Average surged nearly 500 points, or about 2 percent, Tuesday afternoon, after Chinese President Xi Jinping appeared to offer an olive branch to ease trade tensions with the U.S. Fears of a trade war between China and the U.S. have caused dramatic plunges in the Dow after President Trump announced steep tariffs on China, but Xi indicated that Beijing would "significantly" lower auto tariffs and enforce intellectual property rights of foreign corporations. The Dow closed up by 429 points or 1.8 percent. U.S. stock futures edged lower early Wednesday as investors expressed caution ahead of a possible military strike against Syria.
EC investigators raid London office of 21st Century Fox
European Commission investigators raided the London office of Rupert Murdoch's 21st Century Fox, The Daily Telegraph reports. EC competition watchdogs reportedly were seeking documents related to a suspected cartel in sports media rights. Other companies also are under scrutiny, although it was not immediately clear which ones, or whether others were raided. "The commission has concerns that the companies involved may have violated EU anti-trust rules that prohibit cartels and restrictive business practices," the European Commission said in a statement. A spokesman said Fox was "cooperating fully." Fox is in flux as it tries to take over European pay TV company Sky, and sell most of its entertainment assets to Disney for $52.4 billion.
Embattled Theranos lays off most of its employees
Once high-flying blood-testing company Theranos announced a third round of layoffs on Tuesday, reducing its staff to two dozen or less, The Wall Street Journal reported Tuesday. Theranos had about 800 employees as recently as 2015 and 125 just before the latest cuts. The drastic reductions came less than a month after the company and its founder and CEO, Elizabeth Holmes, settled with the Securities and Exchange Commission over civil charges of "massive fraud." The SEC accused the company of using an "elaborate, years-long fraud" exaggerating the company's technology capabilities and financial performance to raise $700 million from investors.