Robinhood’s Tenev says the retail brokerage firm is not interested in selling itself despite struggles

Vlad Tenev, CEO and co-founder Robinhood Markets, Inc., is displayed on a screen during his company’s IPO at the Nasdaq Market site in Times Square in New York City, U.S., July 29, 2021.

Brendan McDermid | Reuters

Robinhood CEO Vlad Tenev said Wednesday that the retail brokerage is not looking to be acquired despite announcing major layoffs after another quarter of shrinking active users.

“In one word: No,” Tenev said on an investor call when asked about potentially being bought by another firm. “I think we’re in a great position as a stand-alone company. I love us as a stand-alone company.”

In May, FTX CEO Sam Bankman-Fried revealed a stake in Robinhood, spurring speculation about a potential takeover bid from the crypto-focused brokerage. Bankman-Fried has since said FTX is not looking to buy Robinhood outright.

Tenev did say that Robinhood was on the lookout for potential acquisitions of its own. The company reported $6 billion in cash on its balance sheet at the end of the quarter.

“We actually see opportunities, particularly in this market environment, to leverage the balance sheet that we have … to acquire companies that accelerate our roadmap,” Tenev said.

The Robinhood investor call came a day after the company announced it was laying off 23% of its workforce. The company also reported a smaller-than-expected loss for the second quarter, but monthly active users declined and revenue was down more than 40% year over year.

Shares of Robinhood rose 11.7% on Wednesday following the layoff announcement. Several Wall Street analysts said the company’s cost-cutting efforts could be a boost to the stock.

Robinhood cut its full-year expense guidance by roughly $290 million, which includes about $70 million decline in expected share-based compensation. Tenev said that the company plans to have positive adjusted EBITDA — a measure of profitability that excludes certain costs such as interest and taxes — by the end of the year.

The company pointed to rate hikes from the Federal Reserve as a source of revenue growth in the form of interest. CFO Jason Warnick estimated that every one-quarter of a percentage point rate hike translates into about $40 million of annualized revenue for Robinhood.

“The precise benefit of rate hikes will depend on how balances and customer rates vary over time,” Warnick said.

The CFO also said Robinhood’s assets under custody rose back above $70 billion in July after declining in the second quarter.

Despite Wednesday’s rally, Robinhood’s stock is still down nearly 42% for the year and more than 70% from where its IPO was priced last year.

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Pelosi Taiwan visit puts TSMC back in spotlight of U.S.-China rivalry

Taiwan Semiconductor Manufacturing Company (TSMC) is the biggest contract chipmaker in the world. But it has been thrust in the middle of U.S.-China geopolitical tensions. logo displayed on the screen.

Rafael Henrique | Sopa Images | Lightrocket | Getty Images

U.S. House Speaker Nancy Pelosi may have left Taiwan but the visit has cast a spotlight once again on the island’s critical role in the global chip supply chain and in particular on the world’s biggest chipmaker, Taiwan Semiconductor Manufacturing Co., or TSMC.

The controversial visit, which angered Beijing, saw Pelosi meet with TSMC Chairman Mark Liu, in a sign of how critically important semiconductors are to U.S. national security and the integral role that the company plays in making the most advanced chips.

Semiconductors, which go into everything from our smartphones to cars and refrigerators, have become a key part of the U.S. and China’s rivalry over technology in the past few years. More recently, a shortage of semiconductors has spurred the U.S. to try to catch up with Asia and maintain a lead over China in the industry.

“Taiwan’s unresolved diplomatic status will remain a source of intense geopolitical uncertainty. Even Pelosi’s trip underlines how important Taiwan is for both countries,” Reema Bhattacharya, head of Asia research at Verisk Maplecroft, told CNBC’s “Street Signs Europe” on Wednesday.

“The obvious reason being its crucial strategic importance as a chip manufacturer and in the global semiconductor supply chain.”

Pelosi’s visit to Taiwan and meeting with TSMC show the U.S. can’t do it alone and will require collaboration with Asian companies that dominate the most cutting-edge chips.

TSMC’s crucial role

As the U.S. fell behind in chip manufacturing over the last 15 years or so, companies like TSMC and Samsung Electronics in South Korea, pushed ahead with cutting-edge chipmaking techniques. While they still rely on tools and technology from the U.S., Europe and elsewhere, TSMC in particular, managed to cement its place as the world’s top chipmaker.

TSMC accounts for 54% of the global foundry market, according to Counterpoint Research. Taiwan as a country accounts for about two-thirds of the global foundry market alone when considering TSMC alongside other players like UMC and Vanguard. That highlights the importance of Taiwan in the world’s semiconductor market.

When you add Samsung into the mix, which has 15% of the global foundry market share, then Asia really dominates the chipmaking sphere.

That’s why Pelosi made it a point to meet with TSMC’s chairman.

Taiwan invasion fears

China views democratically, self-ruled Taiwan as a renegade province that needs to be reunified with the mainland. Beijing spent weeks telling Pelosi not to come to Taiwan.

During her visit, China ratcheted up tensions by carrying out military drills.

There is a concern that any kind of invasion of Taiwan by China could massively affect the power structure of the global chip market, giving Beijing control of technology it had not previously had. On top of that, there is a fear that an invasion could choke off the supply of cutting-edge chips to the rest of the world.

“Most likely, the Chinese would ‘nationalize it,’ (TSMC) and begin integrating the company, and its technology, into its own semiconductor industry,” Abishur Prakash, co-founder of advisory firm the Center for Innovating the Future, told CNBC via email.

What is the U.S. doing?

How does China stack up?

SMIC is crucial to China’s ambitions, but sanctions have cut it off from the key tools it requires to make the most cutting-edge chips as TSMC does. SMIC remains years behind its rivals. And China’s semiconductor industry still relies heavily on foreign technology.

TSMC does have two chipmaking plants in China but they are producing less sophisticated semiconductors unlike the manufacturing facility in Arizona.

Chipmaking alliances

The U.S. has been looking to form partnerships on semiconductors with allies in Asia including Japan and South Korea as a way to secure supply of the crucial components and maintain a lead over China.

TSMC meanwhile is caught in the middle of the U.S.-China rivalry and could be forced to pick sides, according to Prakash. Its commitment to an advanced semiconductor plant in the U.S. could already be a sign of which country it is siding with.

“In fact, a company like TSMC has already ‘picked sides.’ It’s investing in the U.S. to support American chip making, and has said it wants to work with ‘democracies,’ like the EU, on chip making,” Prakash said.

“Increasingly, companies are striking an ideological tone in who they work with. The question is, as tensions between Taiwan and China increase, will TSMC be able to maintain its position (aligning with the West), or will it be forced to recalibrate its geopolitical strategy.”

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What are popular baby names associated with travel? See the lists

Baby Emma, David or Elizabeth? Not for American parents Caitlin and Luke McNeal.

Rather than naming their children after grandparents, biblical figures or the British monarchy, the couple chose the names of places that hold meaningful travel memories for them.

“Kinsale was when we lived in Ireland, and we vacationed in Kinsale and fell in love with it,” said Caitlin. “Keeneland is from Kentucky, the first place we ever vacationed together to watch the horse races.”

And lastly there’s Sabi — “from the Sabi Sands in South Africa, where we went on our first solo vacay without Kinsale.”  

The McNeals are part of a growing trend of choosing baby names based on travel destinations.

The McNeal family — Keeneland, Luke, Sabi, Caitlin and Kinsale.

Source: Caitlin McNeal

The popularity of “travel-inspired” names increased 14% between 2000 and 2020, according a study by the luggage storage app Bounce. The company compared a short list of destination names and travel-related words with data from the U.S. Census Bureau and the U.K.’s Office for National Statistics, it said.

The results show overlap in baby name choices in both countries. However, the trend of naming children after countries and cities is more pronounced in the United States than the United Kingdom, even after accounting for differences in population sizes, the study shows.

Most popular ‘travel-related’ baby names

Preston, Israel, Phoenix and Orlando appear on both lists, yet Preston — which means priest’s town — is the most popular overall.  

The baby website The Bump calls the name “old-fashioned and rather quirky … Though some may see it as a reserved title for the wealthy, Preston is the name place of a Northern English town once known for its role in the industrial revolution.”

American parents of baby boys tended to prefer domestic city names, while British parents showed a proclivity to look abroad, with names like Milan, Orlando and Rome topping their list.

Sydney made the “top 10” lists for baby girl names in both the U.S. and the U.K., but is far more popular with American parents. It’s the only name to have been chosen more than 100,000 times in the 20-year period analyzed in the study.

However, Sydney’s popularity is dwindling in the United States. After peaking in 2002, the name fell from the 23rd most popular name that year to 249th place in 2021, according to the U.S. Social Security Administration.

Historically, baby names have been inspired by literary characters, biblical figures and the British monarchy. Now, there’s a growing trend to add travel destinations to the list.

Source: Ria Hoban

London also made the top 10 lists for American baby names — for both boys and girls — but may be a bit too close to home for British parents. It was chosen only 220 times in the U.K. from 2000 to 2020, compared with 44,556 times in the U.S., according to the study.

Of all names in the study, Atlas rose the most in popularity, according to Cody Candee, CEO of Bounce. There were only eight babies named Atlas in 2000, but nearly 2,175 in 2020 — an increase of more than 27,000%, he said.

“This may be due to parents favoring more unique and meaningful names, with Atlas originating from Greek mythology and meaning ‘to endure,'” he said.

“On the other hand, there are a few names that have decreased in popularity,” he added. “In fact, there were 11 that disappeared completely, the biggest of which was Montreal which went from 23 to 0.”

Baby names that match country names

Ria and Connor Hoban with their children, (from left) Bruno, Joaquin, Bode and India.

Source: Ria Hoban

“Indus is female for river,” said Ria Hoban. “I had my elements read by chance during a night out when I found out I was pregnant, and I was told that I was a water element.”

“In addition, Connor and I honeymooned in India — Delhi, north and south Goa, and Rajasthan, and I have always been mystified by the region. I’ve also always loved the regale of the name and [I’m] a fan of India Hick’s design,” she said, referencing the British designer and relative of the British royal family.

In both the U.S. and the U.K., the trend of naming babies after countries is far more common for daughters. Except for Israel, Trinidad and Cuba, the names on both lists were either exclusively or far more popular choices for girls.

Baby names that match city names

Though London, Kingston (the name of singers Gwen Stefani and Gavin Rossdale’s oldest son) and Paris dominate the lists, one name is noticeably absent from this list: Brooklyn.

That’s because the study didn’t include names of suburbs or boroughs, said Candee.

The popularity of Brooklyn skyrocketed after Victoria and David Beckham chose it for their firstborn son in 1999, said Candee.

If the name was included, Brooklyn would be the “second most popular travel-inspired name for girls in the USA, with 75,948 girls named Brooklyn over the last 20 years,” he said. However, the name is less popular boys, he said — it was chosen just 1,412 times for boys in the U.S. during the same period.

Candee also said that several names were excluded from the analysis for being too commonly used to be inspired by travel. These names include Jordan, Madison, Austin and Charlotte, he said.

It’s unknown to what extent other names were inspired by travel or some other association parents may have made with the names.

One example is Hamilton. Though there are towns and cities named Hamilton in Canada, New Zealand, the U.K. and the U.S., the popular Broadway play “Hamilton” or the Formula One driver Lewis Hamilton may have inspired some parents to choose the name for their children.

Similarly, it’s unknown to what extent parents who named their babies Paris were inspired by the French capital, the Hilton socialite or Shakespeare’s “Romeo and Juliet” — or something else entirely.

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Growing popularity could be undone by one accident

21 July 2022, Bavaria, Essenbach: Water vapor rises behind sunflowers from the cooling system of the nuclear power plant (NPP) Isar 2.

Picture Alliance | Picture Alliance | Getty Images

Nuclear energy is at an inflection point. Early exuberance about its potential was undercut by a series of devastating and dangerous accidents at Three Mile Island in in Pennsylvania in 1979Chornobyl in Ukraine in 1986 and Fukushima Daiichi in Japan in 2011.

But now, thanks to new nuclear technology and the increasingly urgent need to fight climate change, nuclear energy is getting a second shot at becoming a prominent part of the global energy grid. That’s because nuclear energy generation does not create any of the dangerous greenhouse gas emissions that cause climate change.

In a panel discussion at the United Nations on Tuesday, a collection of nuclear energy leaders from around the world gathered to discuss the scope of that renaissance and why it’s so critical that the industry work together to ensure gold-standard safety measures are adopted everywhere.

A nuclear accident anywhere has the potential to upset the most major momentum the nuclear industry has had in decades.

$1 trillion in expected global demand

U.S. Secretary of Energy Jennifer M. Granholm said that nuclear energy represents 20% of the United States’ baseload power, and 50% of its no-carbon-emissions power. “And that’s just from the fleet that we have today without the other additions that we are hoping to see.”

Future nuclear reactors and plants will almost certainly use different technology from the current standard, as both U.S. labs and private companies are funding research into more efficient reactors that are cheaper to build and generate less waste. Granholm mentioned, as an example, the advanced nuclear reactor Bill Gates‘ nuclear innovation company TerraPower is installing in a former coal town in Wyoming.

Demand for advanced nuclear reactors will be worth about $1 trillion globally, Granholm said, according to an estimate from the Department of Energy. That includes jobs building those reactors and all the associated supply chains that will need to ramp up to support that industry, Granholm said.

“Bottom line is spreading advanced nuclear energy is a priority for us,” Granholm said. “Of course, these technologies all have to begin and end with nuclear safety and security.”

The change in sentiment surrounding nuclear energy has happed quite quickly, said Rafael Grossi, the director general of the International Atomic Energy Agency.

A photograph shows dogs passing by a Ferris wheel in background in the ghost town of Pripyat near the Chornobyl Nuclear Power Plant on May 29, 2022, amid the Russian invasion of Ukraine.

Dimitar Dilkoff | AFP | Getty Images

“Until just a few years ago, nuclear would not be present, and perhaps not even welcome” at the annual COP conferences, which stands for “Conference of the Parties” and is an opportunity for country leaders to meet and discuss climate change. “The IAEA has moved quite fast from almost an intruder into a very welcomed participant in this dialogue where nuclear has a place.”

The next COP conference will be in Sharm el-Sheikh, Egypt, in November, and the one after that will be in Dubai Expo City in the United Arab Emirates. The IAEA is planning to be part of both of these coming conferences.

“The mere fact that we are talking about COPs with nuclear in Egypt, and in the Gulf, in and by itself is telling you a lot of what is happening and how we are changing and the possibilities that we have and that could have been almost unforeseeable just a few years ago.”

Safety first

But if nuclear is to continue to be a part of these climate change conferences and conversations, the entire international community has to work together to adhere to strict safety and non-proliferation standards.

“Nobody’s buying a car today if it gets into an accident every day. So safety and security that an application is the foundation for successful deployment of nuclear energy,” said Hamad Al Kaabi, the United Arab Emirates’ representative to the IAEA, on Tuesday.

“The issue how nuclear industry works and is perceived globally, any accident anywhere is an accident everywhere,” Al Kaabi said.

The UAE has three nuclear reactors in operation and a fourth reactor in the final stages of commissioning, Al Kaabi said. But building nuclear plants takes time, and the process in the UAE started approximately 13 years ago.

Vietnam has been considering nuclear power for decades now, according to the World Nuclear Association, an international trade group. The country announced a plan to build a nuclear power plant back in 2006, but put those plans on hold in 2016, partly because of the expense. Then, in March of this year, Vietnam published an official draft energy proposal that includes small modular nuclear reactors.

The United States and the IAEA have both helped guide Vietnam in its efforts to include nuclear energy in its national energy plan, Ha Kim Ngoc, Vietnam’s Deputy Foreign Minister, said in Tuesday’s event. For a country like Vietnam, which has relatively small amount of land, the small footprint that nuclear energy reactors take compared with the amount of energy they produce make it an appealing option, Ngoc said.

South Africa has two reactors, according to the World Nuclear Association, and now other countries in Africa are interested in deploying nuclear energy.

“Most of the countries where I come from in Africa have very small grids,” Collins Juma, the Republic of Kenya’s Nuclear Power and Energy Agency chief executive officer, said on Tuesday. Advanced nuclear reactor designs, especially small modular reactors are interesting to African countries, though Juma did also hint that paying for nuclear reactors might be hard for some African countries. “I’m not sure about the cost, but we shall be discussing that in other forums,” Juma said.

As Africa works to decarbonize, nuclear is a critical baseload corollary to wind, solar and geothermal in the continent. But bringing nuclear energy to Africa will require independent and strong regulation to convince people it is safe.

“Nuclear is a very emotive topic,” Juma said. And it’s one where “everyone is an expert” and thinks they know it is dangerous. “We have to be very careful when we are developing a nuclear power plan. And the public, especially the public, have to have confidence” that the nuclear energy plant is safe, Juma said.

So Juma asked for guidance from leading nuclear powers and organizations. “When you copy, you only copy from the best, you don’t copy from the worst,” Juma said.

For countries that are interested in building nuclear power reactors, IAEA has written an actual guidebook, “Milestones in the Development of a National Infrastructure for Nuclear Power,” and that’s a good place for countries to start, Grossi recommended.

“The moment is serious, and we know it is red alert for Planet Earth,” Grossi said. “We have been saying this, but nuclear is not for a few, nuclear can be for the many.”

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Lucid (LCID) Q2 2022 earnings and production forecast

Lucid Motors CEO Peter Rawlinson poses at the Nasdaq MarketSite as Lucid Motors (Nasdaq: LCID) begins trading on the Nasdaq stock exchange after completing its business combination with Churchill Capital Corp IV in New York City, New York, July 26, 2021.

Andrew Kelly | Reuters

Electric vehicle maker Lucid Group again cut its production targets Wednesday as supply chain and logistics challenges mean demand for the company’s EVs far outpaces its output.

The company said it now has over 37,000 reservations for its Air electric luxury sedan, up from more than 30,000 in May – but it delivered just 679 cars in the second quarter. In February, it said that it expected to build between 12,000 and 14,000 vehicles in 2022, down from an original forecast of 20,000.

It cut its full-year deliveries guidance for a second time, saying that it now expects to deliver just 6,000 to 7,000 vehicles in 2022, and announced a new senior executive to lead operations.

Lucid’s shares fell about 12% in after-hours trading following the news.

The announcements came as Lucid reported its second-quarter results. Here are the key numbers:

  • Revenue: $97.3 million
  • Loss per share: 33 cents
  • Vehicles delivered: 679

“Our revised production guidance reflects the extraordinary supply chain and logistics challenges we encountered,” CEO Peter Rawlinson said in a statement. “We’ve identified the primary bottlenecks, and we are taking appropriate measures – bringing our logistics operations in-house, adding key hires to the executive team, and restructuring our logistics and manufacturing organization.”

Earlier this year, Lucid cited supply chain issues around semiconductor chips as well as basic components like glass and carpet as reasons for the reduction.

Rawlinson told CNBC in an interview that the process of working through the supply-chain issues forced the company to confront another set of bottlenecks.

“It really unveiled the next level of challenges, the immaturity of our logistics systems,” Rawlinson said, explaining that Lucid is in the process of bringing shipping and other services in-house.

To help address the issues, Lucid announced Wednesday it’s hired Stellantis veteran Steven David to serve as its senior vice president of operations, taking charge of the company’s manufacturing, logistics and quality-control efforts.

CFO Sherry House told CNBC that the company’s reservation total of 37,000 does not include any reservations for its upcoming Gravity SUV or any of the vehicles ordered by the government of Saudi Arabia.

Lucid said in April that Saudi Arabia’s government had agreed to buy up to 100,000 of its vehicles over the next 10 years. The country’s public wealth fund is a major investor in Lucid, holding roughly 62% of the company’s shares.

Lucid had $4.6 billion in cash and equivalents as of the end of the second quarter, down from $5.4 billion at the end of March but enough to fund operations “well into 2023,” House said.

This is a developing story. Please check back for updates.

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Hackers attack solana crypto, stealing millions

The logo of cryptocurrency platform Solana.

Jakub Porzycki | NurPhoto via | Getty Images

Nearly 8,000 digital wallets have been drained of just over $5.2 million in digital coins including solana‘s sol token and USD Coin (USDC), according to blockchain analytics firm Elliptic. The Twitter account Solana Status confirmed the attack, noting that as of Wednesday morning, approximately 7,767 wallets have been affected by the exploit. Elliptic’s estimate is slightly higher at 7,936 wallets.

Solana‘s sol token, one of the largest cryptocurrencies after bitcoin and ether, fell about 8% in the first two hours after the hack was initially detected, according to data from CoinMarketCap. It’s currently down about 1%, while trading volume is up about 105% in the last 24 hours.

Starting Tuesday evening, multiple users began reporting that assets held in “hot” wallets — that is, internet-connected addresses, including Phantom, Slope and Trust Wallet — had been emptied of funds.

Phantom said on Twitter that it’s investigating the “reported vulnerability in the solana ecosystem” and doesn’t believe it’s a Phantom-specific issue. Blockchain audit firm OtterSec tweeted that the hack has affected multiple wallets “across a wide variety of platforms.”

Elliptic chief scientist Tom Robinson told CNBC the root cause of the breach is still unclear, but “it appears to be due to a flaw in certain wallet software, rather than in the solana blockchain itself.” OtterSec added that the transactions were being signed by the actual owners, “suggesting some sort of private key compromise.” A private key is a secure code that grants the owner access to their crypto holdings.

The identity of the attacker is still unknown, as is the root cause of the exploit. The breach is ongoing.

“Engineers from multiple ecosystems, with the help of several security firms, are investigating drained wallets on solana,” according to Solana Status, a Twitter account that shares updates for the entire solana network.

The solana network is strongly encouraging users to use hardware wallets, since there’s no evidence those have been impacted.

“Do not reuse your seed phrase on a hardware wallet – create a new seed phrase. Wallets drained should be treated as compromised, and abandoned,” reads one tweet. Seed phrases are a collection of random words generated by a crypto wallet when it is first set up, and it grants access to the wallet.

A private key is unique and links a user to their blockchain address. A seed phrase is a fingerprint of all of a user’s blockchain assets that is used as a backup if a crypto wallet is lost.

The incident comes one day after the $200 million hack of the Nomad blockchain bridge. It’s the latest crisis to grip the crypto market in recent weeks.

“Four addresses are currently linked to the hacker, a far cry from yesterday’s ‘decentralized looting,’ which involved over 120 individual users,” said crypto investor and analyst Miles Deutscher. “This implies that it was a singular party who conducted the SOL exploit, although the specific details remain ambiguous.”

The Solana network was viewed as one of the most promising newcomers in the crypto market, with backers like Chamath Palihapitiya and Andreessen Horowitz touting it as a challenger to ethereum with faster transaction processing times and enhanced security. But it’s been faced with a spate of issues lately, including downtime in periods of activity and a perception of being more centralized than ethereum. A major outage in June knocked the Solana platform offline for several hours.

Ether, the native token of the ethereum blockchain, climbed 6% in 24 hours.

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UN Secretary General urges governments to tax ‘immoral’ oil profits

United Nations Secretary General Antonio Guterres speaks during the 2022 Review Conference of the Parties to the Treaty on the Non-Proliferation of Nuclear Weapons at the United Nations in New York City on August 1, 2022.

Ed Jones | AFP | Getty Images

WASHINGTON — United Nations Secretary-General Antonio Guterres urged governments on Wednesday to tax excessive oil and gas profits as the world grapples with an energy crisis triggered in part, by Rusisa’s war in Ukraine.

“It is immoral for oil and gas companies to be making record profits from this energy crisis on the backs of the poorest people and communities,” Guterres said in a speech before the international forum.

He added that the funds, which equate to $100 billion in the first quarter of this year should instead be used to support vulnerable communities.

“This grotesque greed is punishing the poorest and most vulnerable people while destroying our only home,” Guterres said, calling for governments to also address the mounting climate crisis.

Guterres added that the consequences of the Kremlin’s war have extended beyond Ukraine’s borders and have exacerbated global food insecurity, rising energy costs and crippling debt around the world, but specifically in developing countries.

“Many developing countries drowning in debt, without access to finance and struggling to recover from the COVID-19 pandemic could go over the brink, Guterres warned.

“We are already seeing the warning signs of a wave of economic, social and political upheaval that would leave no country untouched,” he added.

This is breaking news. Please check back for updates.

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CVS says it plans to get into primary care by year end

A CVS Pharmacy store is seen in the Manhattan borough of New York City, New York.

Shannon Stapleton | Reuters

CVS said Wednesday that it plans to acquire or take a stake in a primary-care company by the end of the year, as competition heats up with Amazon and Walgreens.

CEO Karen Lynch said on the company’s second-quarter earnings call that the company wants to team up with a provider that has a strong management team and tech background and the ability to grow quickly.

CVS, best known for its many drugstores, has touchpoints across the health-care industry. It has acquired insurer Aetna and pharmacy benefits manager Caremark. Customers can get vaccines or urgent care at MinuteClinic outposts inside of its stores. And the company keeps adding more health services to those locations, too — it recently introduced therapy services at some stores.

CVS doesn’t yet have doctor offices where patients can go for an annual checkup or appointments with a physician or nurse practitioner, though. At an investor day last year, Lynch said CVS wants to change that by buying or partnering with a company.

At the time, Dr. Alan Lotvin, executive vice president of CVS Health and president of CVS Caremark, said he envisioned CVS standing out in primary care. The company wants to offer longer hours at its doctor offices so people can visit as early as 6 a.m., as late as 9 p.m., or on the weekends. It also wants to utilize simple, streamlined tech, so customers don’t have to fill out piles of paperwork.

Other health-care players have already made moves in the space. Rival Walgreens Boots Alliance is opening hundreds of doctor offices in partnership with VillageMD and became the majority owner of the company. Walmart has a small, but growing number of clinics where people can visit a doctor, dentist or therapist for a low price.

Amazon ratcheted up pressure by announcing last month that it would acquire primary-care provider One Medical for about $3.9 billion. The boutique health-care company has 188 medical offices across 25 markets, according to its latest quarterly results.

Lynch said CVS has a competitive edge with the size of its business. She said nearly 4.8 million customers interact with the company each day at CVS locations. Plus, she said, MinuteClinic visits increased 12% in the fiscal second quarter.

CVS can build “from the strong foundation that we already have,” Lynch said.

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CVS Health (CVS) Q2 2022 earnings

People walk by a CVS Pharmacy store in the Manhattan borough of New York City.

Shannon Stapleton | Reuters

CVS Health on Wednesday lifted its earnings outlook for the year, after beating Wall Street’s expectations for the fiscal second quarter.

The health-care company said it now expects adjusted earnings per share for the full year to come in between $8.40 and $8.60, compared with its earlier estimate of between $8.20 and $8.40.

Shares were up about 4% in premarket trading.

Here’s what the company reported for the three-month period ended June 30, compared with what analysts were expecting, based on a survey of analysts by Refinitiv:

  • Earnings per share: $2.40 adjusted vs. $2.17 expected
  • Revenue: $80.64 billion vs. $76.37 billion expected

On an unadjusted basis, CVS reported net income of $2.95 billion, or $2.23 per share, higher than the $2.78 billion, or $2.10 per share, a year earlier. Revenue of $80.64 billion likewise marked a year-over-year increase, up from $72.62 billion in the same period in 2021.

The results encompass CVS’s several different slices of the health-care business. It has a huge footprint of drugstores, owns insurer Aetna and pharmacy benefits manager CVS Caremark, and provides patient care through MinuteClinics inside of its stores.

CEO Karen Lynch said the company’s strategy of adding more health services is boosting sales and deepening customer relationships.

“Despite a challenging economic environment, our differentiated business model helped drive strong results this quarter, with significant revenue growth across all of our business segments,” she said in a news release.

Same-store sales increased by 8% compared with the year-ago period, as customers bought Covid at-home test kits and cough, cold and flu medications. That far exceeded an expected drop in same-store sales of 0.3%, according to StreetAccount consensus estimates.

In the pharmacy, same-store sales rose 7.6%. In the front of the store, same-store sales jumped 9.4%.

Total pharmacy claims processed gained 3.9% on a 30-day equivalent basis for the three months ended June 30 compared with the prior year. That was driven by an extended cough, cold and flu season compared with the same quarter in 2021.

While sales increased for the quarter, CVS said in a news release that growth was partially offset by a decline in Covid tests and vaccinations, the introduction of new generic drugs and pressure on pharmacy reimbursements.

CVS administered more than 4 million Covid tests and about 6 million Covid vaccinations in the three-month period, Lynch said on an earnings call. That’s down from more than 6 million tests and more than 8 million shots administered in the first quarter.

One aspect of Covid care has increased, however: Lynch said demand continues to rise for antiviral medications to treat Covid infections.

Read the company’s earnings release here.

This is a developing story. Please check back for updates.

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Pelosi’s trip to Taiwan makes matters worse for U.S. and China relations

House Speaker Nancy Pelosi’s trip to Taiwan ramps up U.S.-China tensions and risks pushing the countries further apart, according to one economist.

On Wednesday, the top U.S. lawmaker met Taiwan President Tsai Ing-wen in a highly controversial visit that has angered Beijing.

“We’re on a trajectory of escalating conflict and this will certainly make matters worse. It plays well to local politics in the United States and in Taiwan, but it does not play well to geostrategic forces that are pushing these two nations apart,” Stephen Roach, a Yale University senior fellow and former Federal Reserve economist, told CNBC’s “Street Signs Asia” on Wednesday.

“The leadership in both the U.S. and China to address this conflict is compromised by this basically pouring salt in an open wound for China,” added Roach, who was also previously chairman of Morgan Stanley Asia.

Roach said, however, that does not mean China should be “let off the hook” for some of the concerns that Pelosi has raised.

“But to raise them in the context of a deteriorating relationship is asking for more serious repercussions in a much more difficult and intractable path to resolution. And we are not on a path to resolution. This visit if anything, it pushes that point of coming back together apart rather than bringing it closer together.”

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Pelosi is the highest-ranking U.S. official to visit Taiwan in 25 years, drawing the ire of China which called the move a breach of the “one China” policy. Under that framework, the U.S. recognizes Beijing as the sole legal government of China, though Washington also maintains unofficial relations with Taiwan.

China on ‘defensive’

China had warned it would respond if Pelosi visited Taiwan, a self-ruled island that Beijing considers a runaway province.

At a Wednesday press conference after meeting Tsai, Pelosi said Taiwan was a symbol for democracy and was a contrast to the political system on mainland China and Hong Kong where the “one country two systems” promise “didn’t happen.”

Pelosi got “a lot of bipartisan praise” when details of her trip became public, Doug Heye, a former communications director at the Republican National Committee, told CNBC’s “Capital Connection” on Wednesday.

“I actually am incredibly proud of what Nancy Pelosi did on this trip. The easy thing to do would’ve been to fold and she sure didn’t do it,” he said, adding the House speaker is “consistent with being who she really is.”

Still, Pelosi’s trip creates a new headache for the Biden administration, which has tried to convince Beijing the visit says nothing about U.S. policy toward China or Taiwan.

Roach said the trip puts China on the defensive, pushing Beijing to demonstrate its resolve to pursue eventual reunification of Taiwan with the mainland.

“This is a setback to that objective in China,” he added.” I think China will make some compensating adjustment to offset the setback. I don’t think China will do anything rash. I don’t look for a overt military action, although … there is a considerable exercise or power going on in the Taiwan Strait.”

Ahead of Pelosi’s arrival in Taiwan, the Chinese military held live-fire exercises, deployed fighter jets to the Taiwan Strait and announced more military drills. Roach said while these maneuvers may not precipitate anything more immediate or serious, the risk of accidents shouldn’t be taken lightly.

China won’t be ‘reckless’

Despite China’s saber rattling, Beijing won’t do anything “reckless,” said Ja Ian Chong, an associate professor of political science at the National University of Singapore.

“I don’t think that Beijing wants a crisis to spiral out of control as well … They want to send a strong message, but I don’t think they will want to do anything that’s particularly reckless,” he told CNBC’s “Squawk Box Asia” on Wednesday.

“I think it’s important to keep that in mind. A lot of this messaging intends to create alarm, intends to create fear and to suggest that any effort to do what China does not like with Taiwan brings substantial costs and substantial risks,” he added.

He underlined “coercion itself” comes with enormous costs and risks to Beijing, adding it’s critical to  balance that kind of “threatening behavior with a consideration of what Beijing actually wants and what Beijing’s able to carry off.”

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