(Reuters) – Amazon.com Inc ( AMZN.O ) more than doubled its profit on Thursday and predicted strong spring results as the world’s biggest online retailer raised the price for U.S. Prime subscribers, added U.S. football games and touted its cloud services for business. The results showed the broad strength […]
Weak consumer spending seen restraining U.S. growth in first quarter
WASHINGTON (Reuters) – The U.S. economy likely slowed in the first quarter as growth in consumer spending braked sharply, but the setback is expected to be temporary against the backdrop of a tightening labor market and large fiscal stimulus.
Gross domestic product probably increased at a 2.0 percent annual rate, according to a Reuters survey of economists, also held back by a moderation in business spending on equipment as well as a widening of the trade deficit and decline in investment in homebuilding.
Those factors likely offset an increase in inventories. The economy grew at a 2.9 percent pace in the fourth quarter. The government will publish its snapshot of first-quarter GDP on Friday at 8:30 a.m. (1230 GMT).
Exclusive: U.S. considers tightening grip on China ties to Corporate America
NEW YORK (Reuters) – The U.S. government may start scrutinizing informal partnerships between American and Chinese companies in the field of artificial intelligence, threatening practices that have long been considered garden variety development work for technology companies, sources familiar with the discussions said.
So far, U.S. government reviews for national security and other concerns have been limited to investment deals and corporate takeovers. This possible new expansion of the mandate – which would serve as a stop-gap measure until Congress imposes tighter restrictions on Chinese investments – is being pushed by members of Congress, and those in U.S. President Donald Trump’s administration who worry about theft of intellectual property and technology transfer to China, according to four people familiar with the matter.
RBS profit trebles as costs fall
Royal Bank of Scotland has reported a profit of £792m for the first three months of the year, up from £259m for the same quarter last year. The rise is partly thanks to a fall in restructuring costs, and a drop in conduct and litigation costs. Running costs at the bank, which is 72% state-owned, are also falling as it continues its plan to shrink in size. The quarterly profit follows on from RBS’s first annual profit in 10 years, reported in February. The profit figure was well above estimates.
Microsoft tops estimates as Azure, Office products drive gains
(Reuters) – Microsoft Corp (MSFT.O) on Thursday topped Wall Street forecasts for quarterly profit as the technology company signed up more businesses to its Azure cloud computing services and Office 365 productivity suite. Much of Microsoft’s recent growth has been fueled by its cloud computing business as more enterprises seek to cut data storage costs by adopting cloud-based software and moving their applications to data centers.
The company’s flagship cloud product Azure, which competes with Amazon.com Inc’s (AMZN.O) dominant cloud infrastructure offering Amazon Web Services (AWS), recorded revenue growth of 93 percent in the third quarter ended March 31.
Starbucks’ promotions struggle to attract U.S. customers, shares slip
LOS ANGELES (Reuters) – Starbucks Corp (SBUX.O) on Thursday reported stagnant store traffic at established U.S. cafes for the second quarter in a row, stirring concerns about intense competition from upscale coffee houses as well as fast-food chains and convenience stores.
Shares in the world’s biggest coffee chain fell 1.9 percent in extended hours after stepped-up promotions failed to lure more U.S. customers, who drive the lion’s share of Starbucks profits. Same-store sales for the U.S.-dominated Americas region rose 2 percent for the second quarter ended April 1. Increased spending per visit drove the same-store sales rise since customer visits, referred to as traffic, were flat. Starbucks’ home market of the United States is its largest, with more than 14,000 stores. During the quarter, U.S. cafes offered 15 percent off new blonde espresso drinks and half-price espresso drinks during afternoon Happy Hour.
But China is Starbucks’ biggest growth driver. Same-store sales in that 3,200-store market were up 4 percent in the second quarter, versus gains of 6 percent and 8 percent in the two prior periods. Executives attributed the softer results in the latest quarter to a shift in the timing of Lunar New Year. They said business remains strong, but declined to give traffic results.
Starbucks’ global traffic was down 1 percent for the quarter, with the Europe, Middle East and Africa region falling 4 percent.
Deutsche Bank to scale back investment bank as profits drop
FRANKFURT (Reuters) – Deutsche Bank (DBKGn.DE) announced cutbacks to its bond and equities trading on Thursday in a major overhaul of its troubled investment bank, after posting a 79 percent drop in net profit in the first quarter. A red traffic light is photographed in front of the head quarters of Germany’s largest business bank, Deutsche Bank, in Frankfurt, Germany, December 6, 2017. REUTERS/Kai Pfaffenbach
The cuts will result in job losses and include a scaling-back of its business with hedge funds. The bulk of the cuts will focus on the United States and Asia. The cuts are a move to become more focused on its corporate customers, and a return to its origins after rampant growth across the globe over past decades.