The daily business briefing: July 19, 2018

Harold Maass
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IBM beats expectations as investments in new technology pay off

International Business Machines shares rose by about 2.5 percent in after-hours trading on Wednesday after the company reported second-quarter profit and revenue that beat expectations. IBM said its performance got a boost from growth in cybersecurity, cloud computing, and other higher-margin businesses. The company has been focusing on cloud computing, artificial intelligence, and other new technologies under CEO Ginni Rometty. Revenue from IBM's newer businesses grew by 15 percent to $10.1 billion over the quarter, more than half of IBM's revenue. Excluding one-time expenses and income items, IBM earned $3.08 per share, exceeding Wall Street's expectations of $3.04 per share. [Reuters]


Interior watchdog investigating Zinke's role in land deal

The Interior Department's internal watchdog has launched an investigation into a real estate deal involving a foundation started by Interior Secretary Ryan Zinke in Montana and several developers, including Halliburton Chairman David Lesar, the department's deputy inspector general told House Democrats in a letter Wednesday. Investigators will look into whether Zinke violated conflict of interest laws. The real estate deal involved his wife, Lola Zinke, signing an agreement allowing developers, including Lesar, to build a parking lot for a redevelopment project that could raise the value of land Zinke owned nearby, Politico reports. Critics say Zinke, who is responsible for regulating oil and gas, shouldn't be involved in any business deals with anyone connected to the industries. [Politico]


U.S. stock futures pull back after five-day rally

U.S. stock futures edged down early Thursday in an apparent breather after a five-day rally fueled by optimism over strong corporate earnings. Futures for the Dow Jones Industrial Average fell by 0.2 percent, while those of the S&P 500 and Nasdaq-100 dropped by 0.3 percent and 0.4 percent respectively. The declines came after the Dow closed up by 0.3 percent on Wednesday, capping its longest winning streak in two months. The S&P 500 gained 0.2 percent on Wednesday, and the Nasdaq Composite was down by a single point, or 0.01 percent. Among the corporate earnings reports coming in before the start of trading on Thursday, Domino's Pizza and insurer Travelers shares fell after mixed reports, while Philip Morris shares gained 1 percent after its earnings and profit exceeded expectations. [MarketWatch]


Zuckerberg explains why Holocaust deniers aren't banned from Facebook

In a wide-ranging interview with Recode published Wednesday, Facebook CEO Mark Zuckerberg suggested that Holocaust deniers may not know they're spreading a lie. Zuckerberg recently came under fire for letting blatantly false posts, such as those claiming the Sandy Hook shooting didn't happen, remain on the site. "I don't think that they're intentionally getting it wrong," Zuckerberg said of Holocaust deniers, claiming that "everyone gets things wrong" and that it's hard to determine whether they intended to do so. That's why posts determined false by fact-checkers are moved down in users' timelines, but not necessarily stripped from Facebook entirely, Zuckerberg explained. After receiving criticism for his remarks, Zuckerberg said in an email that he "absolutely didn't intend to defend the intent of people who deny [the Holocaust]." [Recode, CNN]


Prime Day fuels record sales for Amazon and rivals

Amazon's Prime Day broke another sales record for the e-commerce giant this week, but it also helped lift sales for other massive retailers by 54 percent, according to an Adobe Analytics report released Wednesday. Target held a one-day sale on Tuesday to rival Prime Day, and said the day was its biggest online shopping day of 2018, in terms of both traffic and sales. Walmart attracted shoppers by offering free two-day shipping and cutting prices on Google Home devices, to compete with Amazon's Prime Day discounts on its Echo devices. Smaller retailers with sales under $5 million didn't fare so well, seeing an 18 percent decrease in online sales on Prime Day, Adobe said. [TechCrunch]