(NEW YORK) — Yahoo will lay off 20% of its workforce by the end of the year, including 1,000 employees this week, the company announced Thursday.
The cuts are focused on the company’s ad tech division, Yahoo for Business, which will reduce its workforce by nearly 50% by the end of 2023 amid a restructuring of the company’s ads business, a Yahoo spokesperson said.
“These decisions are never easy, but we believe these changes will simplify and strengthen our advertising business for the long run, while enabling Yahoo to deliver better value to our customers and partners,” the spokesperson said in a statement.
The company’s current ads business strategy has not been profitable, the spokesperson said. As part of a revamped approach, a new division, known as Yahoo Advertising, will focus on its demand-side platform, with its ad sales teams prioritizing Yahoo-owned-and-operated properties, including Yahoo Finance, Yahoo News and Yahoo Sports, the spokesperson said.
The company will also sunset its supply-side platform while fully shifting its native advertising efforts to its 30-year partnership with advertising company Taboola, which was announced in November, the spokesperson said.
The cutbacks arrive amid a string of layoffs in the media and tech industries.
Warner Bros. Discovery, Dotdash Meredith and Vox Media are among the companies that have slashed jobs in recent months.
On Wednesday, Disney CEO Bob Iger also said the company is set to eliminate 7,000 jobs in targeting a total of $5.5 billion in cost savings. In all, $3 billion in cuts will come from content, excluding sports, he added; while $2.5 billion will come from non-content cuts.
The eliminated jobs amount to roughly 3% of the company’s 220,000 workers worldwide, according to a securities filing made in October.
The Walt Disney Company is the parent company of ABC News.
(NEW YORK) — Twitter suffered a user outage on Wednesday that lasted for hours and required an emergency fix, prompting an apology from the company and marking one of the first major site malfunctions under the leadership of Elon Musk.
When attempting to post messages, many users encountered a notice telling them that they had exceeded the “daily limit for sending tweets.” Other users said they could not follow new accounts, send direct messages or update their news feed.
A surge in user reports of an outage began around 4:30 p.m. on Wednesday, according to website tracking firm Downdetector. The reports peaked at about 5 p.m. but remained elevated into early Thursday morning, the firm found.
On Wednesday night, Twitter posted an apology on the platform: “Twitter may not be working as expected for some of you. Sorry for the trouble. We’re aware and working to get this fixed.”
Twitter did not immediately respond to a request for comment about the outage.
Days after Musk acquired Twitter, in October, the company began layoffs that ultimately cut more than half of its 7,500-person workforce, raising concerns about Twitter’s capacity to maintain its platform.
In a memo to employees in November, Musk asked workers to commit to being “extremely hardcore” or accept three months of severance upon their exiting the company. Many chose to leave.
For his part, Musk has defended his actions at Twitter as part of an aggressive effort to rescue the company from financial peril, which he described in a Twitter Spaces interview in December as an “emergency fire drill.”
“That’s the reason for my actions,” he added. “They may seem sometimes spurious or odd or whatever.”
In response to a message in November about fear that the site would shut down without sufficient staff, Musk said: “The best people are staying, so I’m not super worried.”
Musk previously said he overpaid for the platform at the purchasing price of $44 billion.
In an effort to make the company less reliant on advertising revenue, Musk launched a new version of Twitter’s subscription service, Twitter Blue, which allows users to access verification if they pay a monthly fee of $8.
In a separate site malfunction, in November, Twitter Blue appeared to be unavailable on the company’s Apple iOS app for some users.
A rise of fake accounts on the platform had coincided with the rollout of Twitter Blue two days earlier. The company later suspended and relaunched Twitter Blue.
The outage on Wednesday came hours after Twitter announced that subscribers to Twitter Blue would be permitted to post longer messages than other users.
“Sometimes you need more words,” the company said.
(NEW YORK) — Southwest Airlines Chief Operating Officer Andrew Watterson faced lawmakers Thursday in a highly-anticipated Senate Commerce Committee hearing to answer for the airline’s historic holiday meltdown.
“Let me be clear: we messed up,” Watterson testified. “In hindsight, we did not have enough winter operational resilience.”
The largest domestic airline in the U.S., Southwest canceled more than 16,000 flights over an 11-day period at the end of December due to a combination of severe winter weather, staffing shortages and technology issues, the company said. Thousands were left stranded in airports across the country instead of at home for the holidays.
Lawmakers want the company to explain the massive disruption at Thursday’s Senate hearing, titled “Strengthening Airline Operations and Consumer Protections.”
“The American people have a lot of questions about the Southwest debacle in December that left passengers stranded or unable to be with loved ones over the holidays,” said Sen. Maria Cantwell, D-Wash., Chair of the Senate Committee on Commerce, Science and Transportation on Wednesday. “We’re going to ask for answers to those questions. I’m interested in hearing the pilot’s testimony that this debacle could have been avoided if Southwest had made investments sooner.”
In addition to Watterson, Southwest Airlines Pilots Association President Captain Casey Murray, Sharon Pinkerton, a senior official with Airlines for America, and Paul Hudson of Flyers’ Rights, a passenger advocacy organization, testified.
Murray said that he and other Southwest pilots saw the meltdown coming but that company leaders ignored their warnings.
“For years, our pilots have been sounding the alarm about Southwest’s inadequate crew scheduling technology and outdated operational processes. Unfortunately, those warnings have been summarily ignored by Southwest leaders,” he said.
He said his goal in participating in the hearing is to help ensure it never happens again.
“Today’s hearing is not to say we told you so. Right doesn’t make our pilots feel any more secure. Our hearts are broken. The December 2022 meltdown was as tragic as it was historic,” he said. “While it would be easy to kick our company when it’s down, this is our company and consequently our careers and our livelihoods.”
Ahead of the hearing, ABC News obtained messages sent to Southwest Airlines’ cockpits during this winter’s meltdown which illustrate the dysfunction taking place at the company.
“Scheduling is asking to confirm who is operating this flight. Please send Employee ID numbers to confirm. It’s a mess down here,” one message said.
Southwest had no idea where their crews were, who was flying their planes and was unable to contact pilots and flight attendants for days.
The airline flew more than 500 empty flights, many on routes that had been cancelled and could have been full of passengers while more than two million people were stranded.
“No updates here. Scheduling is so far behind we were told we aren’t allowed to walk over and talk to them,” another note from a flight dispatcher to a cockpit read.
Last month, in an exclusive interview with ABC’s Good Morning America, Southwest Airlines CEO Bob Jordan apologized for the debacle.
“There’s just no way almost to apologize enough because we love our customers, we love our people and really impacted their plans,” Jordan said. “There will be a lot of lessons learned that come out of this.”
The chaos cost the company as much as $825 million in lost revenue and added expenses, the company said in a government filing last month.
(NEW YORK) — Some people are watching Super Bowl LVII for the big game, while others are watching for the halftime show when superstar Rihanna will make her long-awaited return to music and, of course, we can’t forget the commercials.
Companies from Bud Light to PopCorners have teased their commercials and spent big money ahead of the game, with Variety reporting advertisers could be shelling out between $6 million to $7 million for 30 seconds of commercial time, and their ads aren’t not lacking in star power.
Here are some of the most anticipated and buzzed-about commercials ahead of Sunday’s game:
PopCorners and Breaking Bad stars
Breaking Bad stars Bryan Cranston and Aaron Paul reprised their Emmy award-winning roles for PopCorners’ latest commercial airing during Super Bowl LVII.
The duo created PopCorners, a brand that makes probably addicting and definitely not illegal chips.
General Motors, Netflix and Will Ferrell
General Motors and Netflix have teamed up with comedian Will Ferrell to promote the car manufacturer’s latest line of electric vehicles. The ad shows Ferrell driving different EVs as he makes his way through multiple Netflix shows, such as Stranger Things, Bridgerton and Squid Game.
Have yourself a ‘Hamm and Brie’ sandwich with Hellman’s
Hellmann’s enlisted a “miniature” John Hamm and Brie Larson for its latest Super Bowl commercial, where they are inside a fridge with a jar of its famous mayonnaise. The ad also features Pete Davidson, who makes a “ham and brie” sandwich.
Bud Light and Miles Teller
Bud Light got Miles Teller, star of Top Gun: Maverick, one of the biggest movies of 2022, and his wife Keleigh Teller, an actress who’s appeared in a Taylor Swift music video, for its latest Super Bowl commercial.
The commercial shows the couple dancing to the catchy wait music while on hold.
Clueless with Alicia Silverstone
As if this commercial from Rakuten couldn’t be more iconic. The company recruited Clueless star Alicia Silverstone to reprise her role as Cher in this Super Bowl ad promoting the app’s cash-back feature when users go shopping.
Pepsi Zero Sugar’s master class in acting with Ben Stiller and Steve Martin
Pepsi, known for getting big talent for its Super Bowl commercials, got actors Ben Stiller and Steve Martin to promote its Pepsi Zero Sugar line.
The company released two teasers of Stiller and Martin and the two go back and forth on who’s the better actor.
Something’s Ben Brewing
Dunkin’ has enlisted A-list actor and Dunkin’ lover Ben Affleck — probably — for its new Super Bowl ad. The company teased the news on its social media page. The news come weeks after reports that Affleck was filming a commercial for the company alongside his wife, Jennifer Lopez.
Uber Eats gets Diddy to create ‘one’ hit
Uber Eats brought on music mogul Diddy to help come up with one hit song for Uber One, its membership service that helps users save money when ordering food. In the ad, Diddy enlists Montell Jordan, Kelis and Ylvis to do Uber-centric versions of their hit songs.
Rémy Martin teams with the GOAT
Tennis legend Serena Williams stars in Rémy Martin’s new “inch by Inch” commercial advertising its cognac. The brand has released a few teasers featuring the 23-time Grand Slam champion ahead of Sunday’s big game.
Bookings.com books Melissa McCarthy for a vacation
Bookings.com has booked the hilarious Melissa McCarthy for its latest Super Bowl commercial urging people to use its site to reserve a vacation “somewhere, anywhere.”
(BURBANK, Calif.) — Disney is set to eliminate 7,000 jobs, CEO Bob Iger said on the company’s earnings call on Wednesday.
The company is targeting a total of $5.5 billion in cost savings, Iger said. In all, $3 billion in cuts will come from content, excluding sports, he added; while $2.5 billion will come from non-content cuts.
“This reorganization will result in a more cost-effective, coordinated and streamlined approach to our operations,” said Iger, who rejoined the company as CEO in November. “I do not make this decision lightly.”
The eliminated jobs amount to roughly 3% of the company’s 220,000 workers worldwide, according to a securities filing made in October.
The move will coincide with a restructuring that will divide the company into three core businesses: Disney Entertainment, ESPN and Disney Parks, Iger said.
Shares of Disney, the parent company of ABC News, rose nearly 8% in after-hours trading.
The cutbacks arrive amid a string of layoffs in the media industry. Warner Bros. Discovery, Dotdash Meredith and Vox Media are among the companies that have slashed jobs in recent months.
Jessica Reif Ehrlich, an analyst at Bank of America who closely follows Disney, told ABC News before the earnings call that she expected Iger to address jobs at the company.
“There’s nothing worse than anyone wondering whether they’ll have a job or not,” Ehrlich said. “There’s nothing worse than people walking around saying, ‘What are you hearing?’ ‘What are you hearing?'”
“The certainty is the most important thing,” she added.
Before the announcement, the company released an earnings report that exceeded Wall Street expectations on revenue. Disney brought in $23.5 billion in revenue over the three months ending in December, which marked an 8% growth over the same period a year prior.
But the company’s streaming service, Disney+, lost subscribers for the first time since its launch in 2019. The service dropped 2.4 million subscribers, more than analysts expected.
Beset by cord-cutting that threatens its mainstay traditional TV business, Disney has grown the audience for its bundle of streaming services; but the new platform has yet to turn a profit.
The company also faces a high-profile proxy fight from Nelson Peltz, CEO and founder of activist investment firm Trian Management LP, which has purchased nearly $1 billion worth of Disney stock.
Peltz has called on Disney to prioritize profit growth, cut costs and clarify its succession plans, demanding a seat on the company’s board for himself or his son.
Disney rebuked Peltz’s campaign in a securities filing last month, saying Peltz had “no strategy, no operating initiatives, no new ideas and no plan.”
(NEW YORK) — A number of popular Fabuloso cleaning products were recalled Wednesday by the Colgate-Palmolive Company due to risk of bacteria contamination, according to the Consumer Product Safety Commission.
About 4.9 million units — as well as about 56,000 units in Canada — of various Fabuloso Multi-Purpose Cleaner products were impacted by the recall, according to the CPSC. The affected products were produced from Dec. 14, 2022 through Jan. 23, 2023, according to the company.
“We are voluntarily recalling certain Fabuloso products because a preservative was not added at the intended levels during manufacturing,” Fabuloso said in a statement on its official recall website. “With inadequate preservative, there is a risk of bacteria growth in the recalled products. The recalled products can contain Pseudomonas species bacteria, including Pseudomonas aeruginosa and Pseudomonas fluorescens, which are environmental organisms found widely in soil and water.”
According to the company, the manufacturing issue has since been corrected.
The recalled products were sold at online retailers like Amazon and at other nationwide retailers, including Dollar General, Family Dollar, The Home Depot, Sam’s Club and Walmart, from December 2022 through January 2023.
According to Fabuloso, the company’s antibacterial multipurpose cleaning products and “select other variants of Fabuloso multi-purpose cleaning products” not listed in Wednesday’s announcement are not subject the recall.
Exposure to Pseudomonas aeruginosa, a bacteria which is highly resistant to many antibiotics, can cause infections in the blood, lungs or other parts of the body in humans, according to the Centers for Disease Control and Prevention.
The CPSC noted in a recall announcement Wednesday that those “with weakened immune systems, external medical devices, or underlying lung conditions who are exposed to the bacteria face a risk of serious infection that may require medical treatment.”
“People with healthy immune systems are usually not affected by the bacteria,” the company statement read.
At the time of the recall, no injuries or illnesses have been reported, according to the CPSC.
The CPSC has urged consumers to immediately stop using the recalled Fabuloso products and contact Colgate-Palmolive Company for a full refund or a free replacement, noting that consumers should not empty the product prior to disposal.
(BURBANK, Calif.) — ) — Disney is set to lay off 7,000 workers, CEO Bob Iger said on the company’s earnings call on Wednesday.
The company is targeting a total of $5.5 billion in cost savings, some of which will come from the reduction in workforce, Iger said.
“This reorganization will result in a more cost-effective, coordinated and streamlined approach to our operations,” Iger said. “I do not make this decision lightly.”
The job cuts will coincide with a restructuring that will divide the company into three core businesses: Disney Entertainment, ESPN and Disney Parks, Iger said.
Disney is the parent company of ABC News.
This is a developing story. Please check back for updates.
(NEW YORK) — Many baby formula milk companies allegedly exploit parents’ emotions and “manipulate” scientific data to boost sales, according to a major new analysis published in The Lancet.
The analysis, led by Professor Nigel Rollins of the World Health Organization, said urgent clampdowns are needed to address misleading claims made by the industry.
It comes on the heels of the formula crisis in the U.S. last year, which saw parents struggling to find formula due to global supply chain issues exacerbated by a large recall of Abbott baby formula after two infants died.
“Part of what we’re exploring in The Lancet breastfeeding series is that the system of influence that commercial formula companies are engaged in is much, much more pervasive and much more influential than maybe previously thought.” study co-author Dr. Cecília Tomori, a breastfeeding expert and associate professor at Johns Hopkins School of Nursing, told ABC News.
Scientific evidence overwhelmingly supports breastfeeding newborns, if possible and desired. Breastfeeding has well-documented health benefits for both the parent and the baby.
According to the Centers for Disease Control and Prevention, babies who are breastfed are at lower risk of illnesses and diseases including asthma, obesity, type 1 diabetes and sudden infant death syndrome.
Babies can also receive antibodies from the mother’s breast milk, which boosts their immune systems and helps protect them from disease.
Meanwhile, mothers who breastfeed lower their risk of breast and ovarian cancer, type 2 diabetes and high blood pressure.
The authors say while many new parents breastfeed, many choose not to, and all choices should be supported.
According to the analysis, formula milk companies use exploitative tactics to sell products such as preying on parents’ fears about their children’s health and development.
For example, companies have said it’s important to introduce formula to help settle the behaviors of babies, such as disrupted sleep and persistent crying, implying that breast milk alone is not enough.
“The formula milk industry uses poor science to suggest, with little supporting evidence, that their products are solutions to common infant health and developmental challenges,” co-author Professor Linda Richter, from Wits University in South Africa, said in a press release. “Adverts claim specialized formulas alleviate fussiness, help with colic, prolong night-time sleep, and even encourage superior intelligence.”
“Labels use words like ‘brain’, ‘neuro’ and ‘IQ’ with images highlighting early development, but studies show no benefit of these product ingredients on academic performance or long-term cognition,” Richter added.
The analysis also alleged that formula milk companies used advertisements to imply formula is an “empowering” choice for working mothers, who often don’t have enough parental leave or support in their places of work.
The authors called for broader societal changes to help offset the exploitative behavior of formula milk companies.
This includes adequate maternity leave with the team imploring “governments and workplaces to recognize the value of breastfeeding and care work, by actions such as extending paid maternity leave duration to align with the six-month WHO recommended duration of exclusive breastfeeding.”
They also recommended that health care systems promote breastfeeding and support women to help them with any breastfeeding help during pregnancy, childbirth and after.
“What we’re arguing here and throughout the series is that breastfeeding is a collective societal responsibility, and also human right, and that we need to come together as a society, and policymakers need to understand how important it is and how important it is to invest and properly fund the structures that actually enable breastfeeding and make it possible,” Tomori said.
“One part of that is addressing the exploitative marketing that’s happening. Other parts of that include all the things that we’re very familiar with in the United States, such as facilitating structures that make it possible,” she added.
ABC News’ Sasha Pezenik contributed to this report.
(WASHINGTON) — President Joe Biden on Tuesday is expected to tout the nation’s economic health in his State of the Union Address, just days after a blockbuster jobs report showed a strong labor market has coincided with a monthslong easing of inflation.
Looking ahead, however, Biden is expected to propose solutions for what he considers an ongoing economic ill: income and wealth inequality.
The wealth of the top 1% increased by $6.5 trillion in 2021, according to a study the Federal Reserve released last year. That wealthiest sliver of Americans controls 32% of the country’s wealth, the study found.
The Biden administration’s agenda, set to be announced Tuesday night, includes two policy proposals: a new tax on billionaires and the sharp increase of a current tax on corporate stock buybacks.
“The idea is to have a commitment to reducing inequality,” Reuven Avi-Yonah, a law professor at the University of Michigan who focuses on corporate taxes, told ABC News. “There’s no indication that the increase in inequality is stopping anytime soon and something should be done about it, so the Democrats say.”
Here’s what to know about Biden’s anticipated tax proposals for wealthy individuals and corporations:
Billionaire’s tax
A key part of Biden’s new economic policy agenda is a billionaire’s tax, which would set a minimum tax for the wealthiest Americans, the White House said.
The Biden administration has offered scant details about the proposal, but it appears to closely resemble a policy that Biden put forward last March. At that time, he called for a tax rate of at least 20% on Americans who bring in at least $100 million per year.
The tax rate would apply both to income and unrealized gains, a measure of the value a person’s unsold investments have accumulated.
“President Biden is a capitalist and believes that anyone should be able to become a millionaire or a billionaire,” the White House said in a statement Tuesday. “He also believes that it is wrong for America to have a tax code that results in America’s wealthiest households paying a lower tax rate than working families.”
Between 2018 and 2020, the nation’s wealthiest 400 families paid an average tax rate of 8%, the White House’s Council of Economic Advisers found.
The wealthiest 25 people saw their worth increase a combined $401 billion between 2014 and 2018, but they paid an average federal income tax of 3.4% on that wealth, ProPublica found last year. By contrast, the median American making $70,000 a year pays an average federal income tax of 14%, the outlet said.
The proposal likely will face staunch Republican opposition, giving it a low probability of becoming law, since Republicans control the House of Representatives, Avi-Yonah of the University of Michigan said.
In response to previous efforts to tax wealthy Americans, Republicans have said the measures disincentivized business investment and wealth creation, hindering economic growth.
“The truth is it will not pass now with Republicans in control of the House,” Avi-Yonah said. “So it’s rhetoric.”
Increase to the tax on stock buybacks
In addition to the billionaire’s tax, the Biden administration is expected to propose a sharp increase of a current tax on corporate stock buybacks.
Companies opt to purchase shares of their own stock as a means of returning money to shareholders, since the move typically raises the price of shares.
The Biden administration takes issue with the practice because it provides money for shareholders while evading the taxes on income imposed when a company disperses money to shareholders through dividends, according to the White House. Instead, stock buybacks return money to investors as capital gains, which are taxed at a lower rate.
“Stock buybacks enable corporations to funnel tax-advantaged payouts to wealthy and foreign investors,” the White House said Tuesday.
The Inflation Reduction Act, signed into law by Biden in August 2022, imposed a 1% tax on stock buybacks. If a company purchases $100 million worth of shares, for instance, it must pay $1 million in tax.
In his State of the Union Address, Biden is expected to propose quadrupling that tax to 4%, the White House said.
As with the billionaire tax, the levy on stock buybacks is expected to face strong Republican opposition and long odds to become law.
Jesse Fried, a professor at Harvard Law School focused on corporate governance, said he opposes a tax on stock buybacks because the measures force companies to either hold onto excess capital or invest it in wasteful initiatives.
Instead, stock buybacks allow companies to return money to shareholders, who can then invest or spend the money, spurring economic activity, he said.
“You’re just going to have more cash bottled up in companies,” he said.
Avi-Yonah, meanwhile, said proponents of a higher tax on stock buybacks argue that the measure could pressure companies to invest money in initiatives with greater social benefit.
Supporters of the policy say companies “should be using money for other things like hiring people,” Avi-Yonah said. “Stock buybacks are regressive and benefit the rich at the expense of everyone else.”
(WASHINGTON) — Federal Reserve Chair Jerome Powell said Tuesday that the central bank’s fight against inflation has “a long way to go,” citing a blockbuster jobs report last week that showed the labor market remains hot despite the Fed’s efforts to cool the economy.
“This process is likely to take quite a bit of time,” Powell said. “It’s not likely to be smooth.”
Consumer prices rose 6.5% over the yearlong period ending in December, which amounts to a significant slowdown from a summer peak but is more than triple the Federal Reserve’s target of 2%.
Speaking at The Economic Club of Washington, D.C., Powell said the “extraordinarily strong” job figures took the Fed by surprise.
The economy added 517,000 jobs in January and the unemployment rate fell to its lowest level in 53 years.
“It’s certainly stronger than anyone I know expected,” Powell said. “We didn’t expect it to be this strong.”
“It kind of shows you why we think this will be a process that takes a significant period of time,” he added.
The Fed recently imposed the latest in an aggressive string of borrowing cost increases as it tries to slash price hikes by slowing the economy and choking off demand. The approach, however, risks tipping the U.S. economy into a recession and putting millions out of work.
Powell has repeatedly said that the Fed will keep its benchmark interest rate elevated until inflation reaches the central bank’s 2% target. That means borrowers face higher costs for everything from car loans to credit card debt to mortgages.
While Powell said the strong jobs report indicates that the fight against inflation remains in its “very early stages,” he considered the labor boom a positive sign.
“It’s a good thing that inflation has started to come down without cost to the labor market,” he said.
The remarks from Powell arrive a day after Treasury Secretary Janet Yellen rejected recession fears in an interview with “Good Morning America” on Monday, saying the economy remains “strong and resilient.”
“You don’t have a recession when you have 500,000 jobs and the lowest unemployment rate in more than 50 years,” Yellen said.
Government data last month showed that the U.S. economy grew robustly at the end of last year.
Still, most economists expect a recession later this year, as interest rate hikes weigh on the economy, according to a survey released by Bloomberg last month. Forecasters expect gross domestic product to fall over the second and third quarters of this year, the survey found.
Since some areas of the economy have defied an expected slowdown, more rate hikes are likely forthcoming, Powell said.
“We think we’re going to need to do further rate increases,” he said. “And we think we’re going to need to hold policy at a restrictive level for a period of time.”
