STOCK MARKET NEWS: First Republic fix, Electronic Arts layoffs, JetBlue travel warning

MARKETS

First Republic Bank is not currently looking for a buyer

First Republic Bank is no longer actively looking for a buyer as potential suitors are concerned about the losses they'll have to add to their books with no government backup.

First Republic Bank plans to fix its balance sheet before pursuing a buyer, FOX Business has learned.

Advisers for First Republic are also weighing a number of ways to fix the bank's balance sheet including seeking additional capital from the federal government in exchange for warrants in the bank.

The bank’s balance sheet is negative by as much as $12 billion.

Electronic Arts office is shown in Los Angeles, Calif., July 27, 2020. (Reuters/Mike Blake)

Videogame publisher Electronic Arts said on Wednesday it will lay off about 6% of its workforce and reduce office space, joining a host of U.S. companies that have trimmed costs to cope with a rough economy.

EA, which had about 12,900 staff as of March-end last year, expects to incur between $170 million and $200 million in charges related to its restructuring plan.

Corporate America, especially companies from the technology and finance sector, are reining in expenses as they brace for a looming recession amid rising interest rates around the world.

The company behind the "FIFA" soccer videogame franchise and "The Sims" also said it will move away from projects that do not contribute to its strategy.

CEO Andrew Wilson in a note to employees said EA will provide opportunities for employees to move to other projects and where that is not possible, it will provide staff laid off with severance pay and additional benefits.

RH is lower in extended trading.

The company formerly known as Restoration Hardware said fourth quarter revenue fell 14.5% to $772 million. Analysts expected $779.75 million.

Net income was $107 million, down from $147 million in the prior year.

Earnings per share came to $2.88 versus the Wall Street estimate of $3.34.

“We expect business conditions to remain challenging for the next several quarters and possibly longer as a result of the accelerating weakness in the housing market, the uncertainty generated by the recent banking crisis and the cycling of record Covid-driven sales and backlog reductions,” the company said.

RH expects fiscal 2023 revenues in the range of $2.9 to $3.1 billion and adjusted operating margin in the range of 15% to 17%, which includes an approximate 150 basis point drag due to the ramp-up of global expansion.

JetBlue A321neo on Tarmac (Photo: JetBlue)

Low cost carrier JetBlue says a larger-than-average shortage of air traffic controllers over New York airspace will lead to flight cuts this summer travel season.

During a speech at the Economic Club of New York, CEO Robin Hayes said delays may be 45% worse than last summer.

Hayes noted disruptions will not be limited to JetBlue or the New York area, noting that every flight one of his airline’s southbound flights transit through the New York air traffic control center.

LIFESTYLE

JetBlue will cut flights in, out of New York this summer, CEO says

JetBlue CEO Robin Hayes said during a discussion at the Economic Club of New York that airlines are going to have to reduce flights in and out of New York this summer.

Longtime Starbucks CEO Howard Schultz takes his seat at a crowded Senate Health, Education, Labor and Pensions Committee hearing room where he expects to face sharp questioning about the company's actions during an ongoing unionizing campaign, at the Capitol in Washington, Mar. 29, 2023. (AP Photo/J. Scott Applewhite)

Longtime Starbucks CEO Howard Schultz faced sharp questioning Wednesday before the Senate Health, Education, Labor and Pensions Committee as he defended the company's actions during an ongoing unionizing campaign.

POLITICS

Former Starbucks CEO defends labor practices in Senate hearing

Ex-Starbucks CEO Howard Schultz defended the company while testifying before a Senate committee Wednesday, in which Democrats accused the coffee giant of "union busting."

U.S. Sen. Bernie Sanders , a Vermont Independent who has been a vocal supporter of Starbucks labor organizers, accused the company of stalling efforts to reach a contract with workers who first voted to unionize in late 2021. He also said federal courts and administrative judges at the National Labor Relations Board have found Starbucks guilty of firing labor organizers and illegally closing unionized stores, among other tactics.

Schultz denied the company has broken the law and said Starbucks is appealing those charges. Schultz said Starbucks respects workers' right to unionize, but believes the company already provides its workers with industry-leading wages and benefits.

He said that Starbucks' average starting wage is $17.50, while the minimum wage in Vermont is $13.18.

Apple’s Worldwide Developers Conference returns June 5, 2023 (Photo: Apple)

Apple Inc said on Wednesday it will host its annual developers' conference from June 5 to June 9, where the iPhone maker is expected to unveil its latest software updates.

Analysts will also look for hints from Apple about the much-anticipated mixed-reality headset that can overlay digital objects on a view of the real world. For new devices, the company sometimes gives developers a heads-up so they can start working on apps..

The company said it will host developers and students at Apple's headquarters in Cupertino, California on June 5 to watch the keynote and State of the Union videos along with the online attendees.

At last year's conference, Apple laid out plans to more deeply integrate its software into the core driving systems of cars and rolled out a slew of features for payments and business collaboration as well as a pair of new laptops.

Donald Trump (AP)

Digital World Acquisition Corp, a blank-check firm merging with the social media platform owned by former U.S. President Donald Trump, said on Wednesday it had been cleared by the Nasdaq over non-payment of certain dues.

Earlier this month, Digital World revealed that it had received a notice from the exchange over non-payment of some dues which could lead to a potential de-listing.

Digital World has already been facing delays in closing the deal to take Truth Social public due to investigations on whether the Trump-backed company broke securities regulations.

The deal was inked in October 2021 and late last year shareholders approved extending the deadline to close the deal to September 2023.

Last week, the company ousted Chief Executive Patrick Orlando, saying that it was "in the best interest of its shareholders to select a new management team."

MEDIA

Truth Social CEO shuts down rumor Trump is ditching platform for Twitter, Facebook

Truth Social CEO Devin Nunes refutes a recent report claiming former President Donald Trump is ditching his exclusivity deal to post freely on Twitter and Facebook.

Home for sale in Voorhees, N.J., Mar. 26, 2023.

Contracts to buy U.S. previously owned homes increased for a third straight month in February, raising cautious optimism that the housing market slump could be bottoming out.

ECONOMY

Pending home sales eked out small gain in February as mortgage rates rose

Pending home sales climbed 0.8% in February, rising for the third straight month even as higher mortgage rates weighed on consumer demand for new homes.

The National Association of Realtors (NAR) said on Wednesday its Pending Home Sales Index, based on signed contracts, rose 0.8% last month to the highest level since August.

Economists polled by Reuters had forecast contracts, which become sales after a month or two, would fall 2.3%. The surprise increase occurred despite a rise in mortgage rates from early February through early March, according to data from mortgage finance agency Freddie Mac. Before the recent rise, mortgage rates had mostly been on the decline since November.

Contracts jumped 6.5% in the Northeast. They also edged higher in the Midwest and South, but dropped 2.4% in the West.

Adidas and Black Lives Matter logos in this illustration taken Mar. 29, 2023. (Reuters/Dado Ruvic/Illustration)

Sportswear maker Adidas AG on Wednesday reversed course 48 hours after asking the U.S. Trademark Office to reject a Black Lives Matter application for a trademark featuring three parallel stripes.

LIFESTYLE

Adidas to drop opposition to Black Lives Matter’s three-stripe logo

Adidas is dropping opposition to Black Lives Matter's legal bid to trademark the three-stripe logo amidst complaints about company culture and lack of diversity.

"Adidas will withdraw its opposition to the Black Lives Matter Global Network Foundation's trademark application as soon as possible," the company said in a statement.

Adidas rescinded its opposition without prejudice, which means it could still challenge the trademark on the same grounds in future.

A source close to the company said the rapid about-turn was triggered by concern that people could misinterpret Adidas' trademark objection as criticism of Black Lives Matter's mission.

Adidas had told the trademark office in a Monday filing that the Black Lives Matter Global Network Foundation's yellow-stripe design so closely resembles its own famous three-stripe mark that it is "likely to cause confusion".

It sought to block the group's application to use the design on goods that the German sportswear maker also sells, such as shirts, hats and bags.

Bluebird Bio Inc. on Wednesday reported fourth-quarter net income of $32.2 million, after reporting a loss in the same period a year earlier.

On a per-share basis, the Somerville, Massachusetts-based company said it had profit of 38 cents. Losses, adjusted for non-recurring gains, came to 57 cents per share.

The results missed Wall Street expectations. The average estimate of seven analysts surveyed by Zacks Investment Research was for a loss of 45 cents per share.

The biotechnology company posted revenue of $62,000 in the period, which also missed Street forecasts. Four analysts surveyed by Zacks expected $102.2 million.

For the year, the company reported that its loss narrowed to $266.6 million, or $3.39 per share. Revenue was reported as $3.6 million.

Cintas Corp. on Wednesday reported fiscal third-quarter profit of $325.8 million.

On a per-share basis, the Cincinnati-based company said it had net income of $3.14. The results exceeded Wall Street expectations. The average estimate of nine analysts surveyed by Zacks Investment Research was for earnings of $3.01 per share.

The uniform rental company posted revenue of $2.19 billion in the period, also exceeding Street forecasts. Eight analysts surveyed by Zacks expected $2.14 billion.

Cintas expects full-year earnings to be $12.70 to $12.90 per share, with revenue in the range of $8.74 billion to $8.8 billion.

AMC theater, Marlton, N.J.

Shares of AMC Entertainment Holdings Inc jumped as much as 21% on Tuesday, following a report that ecommerce giant Amazon.com Inc was looking to buy the theater chain.

Amazon founder Jeff Bezos has dispatched his investment advisers and top entertainment chiefs to explore acquisition plans for AMC, entertainment industry news website The Intersect reported, citing sources familiar with the discussions.

AMC and Amazon declined to comment on the report.

MARKETS

Amazon reportedly considering purchase of AMC Entertainment

Amazon is reportedly looking into the potential purchase of AMC Entertainment and its chain of movie theaters as a means of boosting its physical marketing presence.

A sign is displayed at a branch of Signature Bank in New York, on Mar. 13, 2023. (AP Photo/Seth Wenig, File)

 The Federal Deposit Insurance Corp (FDIC) has hired Newmark Group Inc to sell about $60 billion of Signature Bank loans, the Wall Street Journal reported on Wednesday citing people familiar with the matter.

The commercial property market is likely to see a ripple effect from the sale of a loan book this large, at a time when property values are already being squeezed, the report added.

FDIC and Newmark Group did not immediately respond to Reuters' requests for comment on the report.

MARKETS

FDIC gives Signature’s crypto clients account deadline

Customers who had crypto deposits at Signature Bank have been issued a deadline to close the accounts and move their money.

Jamie Dimon, Chairman and Chief Executive Officer of JPMorgan Chase & Co., pauses as he speaks during an interview with Reuters in Miami, Fla., Feb. 8, 2023. (Reuters/Marco Bello)

Jamie Dimon, the chief executive of JPMorgan Chase & Co, will be interviewed under oath over the bank's relationship with late sex offender and former client Jeffrey Epstein, a lawyer involved in the case said on Tuesday.

BUSINESS-LEADERS

JPMorgan's Jamie Dimon to be deposed in Epstein case: report

JPMorgan Chase CEO Jamie Dimon will reportedly be interviewed under oath in connection with the bank's relationship with Jeffrey Epstein.

The deposition is expected in early May, according to Brad Edwards, a lawyer representing women who claim they were sexually abused by Epstein and are suing the largest U.S. bank for allegedly enabling the financier's sex trafficking.

JPMorgan declined to comment.

Newly appointed Group Chief Executive Officer of Swiss Bank UBS Sergio Ermotti, right, UBS Chairman Colm Kelleher, left, speak during a news conference in Zurich, Switzerland, March 29, 2023. (Michael Buholzer/Keystone via AP)

UBS said Wednesday that it's bringing back former CEO Sergio Ermotti to lead the Swiss bank as it executes a government-orchestrated plan to take over struggling rival Credit Suisse.

Ermotti, who was the bank's top executive for nine years and led a turnaround following the 2008 global financial crisis, will take over next Wednesday from CEO Ralph Hamers.

MARKETS

UBS brings back past CEO with Credit Suisse deal ahead

Swiss bank UBS has decided to bring back former CEO Sergio Ermotti to guide the takeover of Credit Suisse. He will take over for current chief executive Ralph Hamers.

Hamers took up the job in November 2020 and will remain at UBS during a transition period “to ensure a successful closure of the transaction and a smooth handover,” the bank said in a statement.

“Whilst Ralph was capable of doing the job, we felt that Sergio was better suited to navigating these things,” Chairman Colm Kelleher said on a conference call, alluding to the UBS board decision. “I cannot reemphasize how big this deal is in terms of financial history and financial engineering that’s required.”

The overdose-reversal drug Narcan is displayed during training for employees of the Public Health Management Corporation (PHMC), Dec. 4, 2018, in Philadelphia, Pa. (AP Photo/Matt Rourke, File)

The U.S. Food and Drug Administration on Wednesday approved the over-the-counter use of Emergent BioSolutions Inc's Narcan, making it the first opioid overdose reversal drug to be sold nationwide without a prescription.

The approval for OTC use of Narcan, Emergent's naloxone-based nasal spray, will help increase its availability and align the federal government's stance with states that have provisions to offer the drug without prescription through a pharmacist.

Drug-related overdose deaths in the United States rose about 15% year-over-year to more than 100,000 in 2021, as per official data.

BUSINESS-LEADERS

Macy's CEO Jeff Gennette to retire next year

Tony Spring, the current chairman and CEO of Bloomingdale's, will replace 61-year-old Jeff Gennette as chief executive of Macy's in February of next year.

Macy's CEO Jeffrey Gennette will retire next year and will be replaced by the CEO of Bloomingdale's Tony Spring.

A Lululemon sign is seen at a shopping mall in San Diego, California, U.S., November, 23, 2022. REUTERS/Mike Blake

Lululemon Athletica Inc forecast annual sales and profit above Wall Street estimates on Tuesday, betting on strong demand for its pricier yoga wear even as inflation hurts consumer spending, sending its shares up about 9% in extended trading.

Even as stubbornly high prices of essential goods force customers to cut down on discretionary purchases such as apparel, wealthier shoppers are still spending on Lululemon's tops, yoga pants and shorts, bolstering traffic both online and in stores.

While Lululemon has offered more discounts to clear excess inventories, analysts have noted that the company's top-selling products and core categories are still selling at full price, with promotions centered around accessories such as footwear and bags.

Lululemon's Align high-rise yoga pants, listed among the best-selling items on its website, retails between $98 and $118.