Category: Business

(NEW YORK) — Shares of Netflix soared 12% in early trading on Wednesday, just hours after the streaming giant announced price increases set to impact all of the company’s U.S. subscribers.

The standard monthly subscription without advertisements will climb from $15.49 to $17.99, and a standard monthly subscription with ads will increase one dollar to $7.99, Netflix said.

The price hikes arrived alongside a stellar earnings report that showed the largest subscriber gains over a three-month period since the company’s founding more than a quarter-century ago.

Netflix added 19 million subscribers over the last quarter of 2024, vaulting the company to 302 million subscribers worldwide. Revenue jumped 16% over the final three months of 2024 compared to a year earlier, topping $10 billion in a single quarter for the first time.

“As we continue to invest in programming and deliver more value for our members, we will occasionally ask our members to pay a little more so that we can re-invest to further improve Netflix,” Netflix said in a letter to investors.

The second season of hit show “Squid Game” helped propel the subscriber bounce, Netflix said, noting that the series is on pace to be the most-watched season of original programming in the company’s history.

Netflix also found success in the latter part of 2024 with the holiday movie “Carry On” and a live boxing match between influencer Jake Paul and former heavyweight champion Mike Tyson, the company said.

“It’s great that all these big swings worked very well in the quarter,” Netflix co-CEO Ted Sarandos said on a conference call with investors on Tuesday.

The price hikes at Netflix follow a string of price jumps imposed by competitors last year.

In August, Disney announced price increases for streaming services Disney+, Hulu and ESPN+ that amounted to hikes of between $1 or $2 for each platform. Two months earlier, Warner Bros. Discovery’s Max increased prices for its ad-free membership by $1 per month. (Disney is the parent company of ABC News.)

Stock analysts lauded Netflix in memos to clients on Wednesday.

In a note shared with ABC News, Bank of America Global Research described the earnings report as “very strong.”

Tigress Financial, a New York City-based advisory firm, said Netflix’s performance foretells further increases in the company’s share price.

“The incredible power of its subscriber growth and subscriber base will continue to drive further gains in the stock,” Tigress Financial wrote in a letter shared with ABC News.

Netflix led all studios with 36 nominations for the Golden Globes, which took place earlier this month. “Emilia Pérez,” a film starring Zoe Saldaña and Selena Gomez, won four awards, including best motion picture – musical or comedy.

Speaking to investors on Tuesday, Sarandos said the wildfires in Los Angeles would not delay the company’s releases this year or reduce anticipated revenue.

“No meaningful delays in the delivery of the projects and no meaningful impact to the cash in 2025, but very meaningful disruption in people’s lives,” Sarandos said.

“So, our goal is to keep everything on schedule safely, be mindful of folks who need time to work through the challenges of the fires, including, in some cases, loss of life and home. But this industry has been through a really tough couple of years, starting with COVID, going into the strikes, and now this,” Sarandos added.

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(ISSAQUAH ,WA) — In pursuit of increased wages and renegotiated employee benefits, more than 18,000 Costco union members nationwide voted to authorize a strike if the wholesale company doesn’t agree to their terms by Jan. 31.

The looming Costco strike marks the latest in a string of Teamsters union walkouts from employees of industry giants including Amazon and Starbucks.

The strike was approved on Sunday with more than 85% of Costco Teamsters voting in favor of hitting the picket lines if demands aren’t met.

The union said Costco had rejected contract proposals that included increased seniority pay, paid family leave, bereavement policies, sick time and safeguards against surveillance.

Bryan Fields, a Costco employee in Baltimore and member of Teamsters Local 570, told ABC News that the strike deadline comes after months of stalled conversations, extensions and failed negotiations with the company.

“They had plenty of months to negotiate and they would extend, extend, extend,” Fields, who has worked for the membership-only retailer for over a decade, claimed.

He and Teamsters spokesperson Matt McQuaid said negotiations with the company have been ongoing since August, without agreement.

ABC News has reached out to Costco Wholesale for a comment.

“No one wants to strike, no one’s excited about doing anything like that, and I’m sure they don’t want us to do that as well,” Fields said of the company, adding, “Let’s bypass all of that and just do what they promise in their code of conduct, which is ‘take care of employees.'”

According to Teamsters, Costco recently reported $254 billion in annual revenue and $7.4 billion in net profits, which marked a 135% increase since 2018.

While the details of the union’s negotiations with Costco’s top brass remain fluid, according to McQuaid, employees are “fully prepared” to picket come Feb. 1 if an agreement is not reached.

Last week hundreds of Costco Teamsters nationwide organized practice pickets from Hayward, California, to Sumner, Washington, and Long Island, New York, the organization said in a press release Sunday.

The 18,000 Teamsters union members who voted to authorize the strike account for 8% of Costco’s mostly non-union employees.

“Our members have spoken loud and clear — Costco must deliver a fair contract, or they’ll be held accountable,” Teamsters General President Sean M. O’Brien said in the release.

“From day one, we’ve told Costco that our members won’t work a day past January 31 without a historic, industry-leading agreement. Costco’s greedy executives have less than two weeks to do the right thing. If they refuse, they’ll have no one to blame but themselves when our members go on strike,” O’Brien added.

As of this month, there were 624 Costco Wholesale locations across the country.

The membership-only warehouse club chain is the third-largest retailer in the world behind Walmart and Amazon, with over 600 locations across the U.S.

Fields says employees who are the “backbone” of the multi-billion-dollar company’s success just want a “piece of the pie.” He hopes Costco can reach an agreement with union members before the strike terms expire, saying, “It’s in their hands right now.”

“The union is simply a voice of the people. They choose whether we become the weapon for the people. It’s as simple as that,” Fields said.

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(NEW YORK) — Cryptocurrencies affiliated with President Donald Trump and first lady Melania Trump plummeted in the initial hours after Trump was sworn into office Monday.

“Official Trump,” a recently launched crypto token, plunged more than 20% in value over a 24-hour stretch ending Tuesday morning, according to crypto tracking site CoinGecko. After the drop, Official Trump stood at $38.

The decline for Trump’s meme coin reverses some of the gains enjoyed in an initial surge after it hit crypto markets last week. The coin’s price climbed from about $10 on Saturday morning to a high of about $74.59 before it began to slide.

“Melania Meme,” which also launched last week, dropped in value by more than half over a 24-hour timespan ending on Tuesday morning, CoinGecko data showed. The price of the Melania Meme was $4.19 on Tuesday morning.

The recent decline for the coins associated with Trump and Melania coincided with a slight drop for bitcoin, the world’s largest cryptocurrency. In early trading on Tuesday, bitcoin fell nearly one percentage point, putting its price at $102,853.

Many digital assets have climbed since Trump won the November election, indicating investor enthusiasm about declarations Trump made in support of cryptocurrency.

In July, Trump told the audience at a cryptocurrency conference in Nashville, Tennessee, that he wanted to turn the U.S. into the “crypto capital of the planet.”

Trump also has promised to ease regulations for the sector and establish the federal government’s first National Strategic Bitcoin Reserve.

On Monday, Securities and Exchange Commission Chair Gary Gensler officially resigned from his position, marking the departure long-sought by some crypto boosters who viewed Gensler as overly restrictive toward digital assets.

There have been reports that Trump would sign an executive action that would prioritize cryptocurrency policy. However, no such order was among the dozens of actions Trump signed 

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TikTok said Sunday it’s “restoring service” after a ban in the United States initially began to take effect earlier in the day.

“In agreement with our service providers, TikTok is in the process of restoring service. We thank President Trump for providing the necessary clarity and assurance to our service providers that they will face no penalties providing TikTok to over 170 million Americans and allowing over 7 million small businesses to thrive,” the company said in a statement. “It’s a strong stand for the First Amendment and against arbitrary censorship. We will work with President Trump on a long-term solution that keeps TikTok in the United States.”

In a pop-up message visible to users upon reopening the app on Sunday, TikTok again credited President-elect Donald Trump for the app’s return.

“Welcome back! Thanks for your patience and support,” the message read. “As a result of President Trump’s efforts, TikTok is back in the U.S.!”

TikTok briefly went dark between late Saturday night and early Sunday.

Last spring, Congress passed a measure with overwhelming bipartisan support granting TikTok a 270-day window to cut its ties with China-based parent company ByteDance or face a ban in the U.S. Instead of initiating a sale, however, TikTok pursued a legal challenge on First Amendment grounds that ended in failure at the Supreme Court on Friday.

The unanimous ruling from the nation’s highest court found merit in national security concerns regarding potential user data collection or content manipulation that the Chinese government might undertake.

The platform became unavailable for some users Saturday evening, with a pop-up message in the app saying, “Sorry, TikTok isn’t available right now.”

“A law banning TikTok has been enacted in the U.S. Unfortunately, this means you can’t use TikTok for now,” the message went on. “We are fortunate that President Trump has indicated that he will work with us on a solution to reinstate TikTok once he takes office. Please stay tuned!”

By Sunday morning, the app was unavailable in stores run by Apple, Google and Samsung.

The Biden administration said earlier this week that it would not enforce the ban on Sunday, leaving implementation of the measure to President-elect Donald Trump, who takes office on Monday. Trump has vowed to reverse the ban.

In a Truth Social post on Sunday morning, Trump said he’s “asking companies not to let TikTok stay dark!” He said he would issue an executive order on Monday, his first day in office, “to extend the period of time before the law’s prohibitions take effect, so that we can make a deal to protect our national security.”

“The order will also confirm that there will be no liability for any company that helped keep TikTok from going dark before my order,” he added.

Trump said he wants “the United States to have a 50% ownership position in a joint venture.” He said this could be a joint venture between the current owners and new owners.

Earlier Sunday, a Biden administration official accused TikTok of trying to “blame” the situation on the Biden administration, saying “they’ve had a year to deal with it and we were clear we wouldn’t implement it on our final day.”

White House officials had stressed for days that if TikTok were to go dark on Sunday, it would not be because of U.S. enforcement — it would be TikTok’s decision, and that the administration is only kicking the issue to Trump because of the timing.

ABC News’ Michelle Stoddart and Selina Wang contributed to this report.

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(WASHINGTON) — Consumer prices rose 2.9% in December compared to a year ago, ticking up from the previous month and extending a resurgent bout of inflation just days before President-elect Donald Trump takes office. The reading matched economists’ expectations.

The fresh data arrives after a jobs report last week showed stronger-than-expected hiring in December, which sent the stock market plummeting and bond yields soaring on fears that the Federal Reserve may delay long-forecasted interest rate cuts.

The Fed may find additional reason to delay those interest rate cuts in Wednesday’s report, since stubborn price hikes may raise concern that inflation would move even higher if interest rates were to be lowered.

The inflation reading in December marks an increase from year-over-year inflation of 2.7% in the month prior.

Core inflation — a closely watched measure that strips out volatile food and energy prices — increased 3.2% over the year ending in December, ticking lower than the previous month, the data showed.

Food prices rose 2.5% in December compared to a year ago, moving higher than the previous month but marking slower price increases than the overall inflation rate.

Prices increased for an array of goods last month, including shelter, airline fares, used cars and trucks, new vehicles, motor vehicle insurance, and medical care, the U.S. Bureau of Labor Statistics said. By contrast, prices dropped for personal care products and alcoholic beverages, as well as a host of foods, such as white bread, seafood and ice cream.

Egg prices continued to skyrocket in December due to an avian flu that has decimated supply in recent months. The price of eggs soared 36% compared to a year prior, data showed.

Inflation has slowed dramatically from a peak of more than 9% in June 2022, but price increases remain above the Fed’s target rate of 2%.

The Fed retreated in its fight against inflation over the final months of last year, lowering interest rates by a percentage point. Still, the Fed’s interest rate remains at a historically high level of between 4.25% and 4.5%.
The Fed has already indicated worry about the resurgence of escalating inflation over the latter part of 2024.

Last month, the Fed predicted fewer rate cuts in 2025 than it had previously indicated, suggesting concern that inflation may prove more difficult to bring under control than policymakers thought just a few months ago.

Speaking at a press conference in Washington, D.C., in December, Fed Chair Jerome Powell said the central bank may proceed at a slower pace with future rate cuts, in part because it has now lowered interest rates a substantial amount.

Powell also said a recent resurgence of inflation influenced the Fed’s expectations, noting that some policymakers considered uncertainty tied to potential policy changes under Trump.

“It’s common-sense thinking that when the path is uncertain, you get a little slower,” Powell said. “It’s not unlike driving on a foggy night or walking around in a dark room full of furniture.”

Trump has proposed tariffs of between 60% and 100% on Chinese goods, and a tax of between 10% and 20% on every product imported from all U.S. trading partners.

Economists widely forecast that tariffs of this magnitude would increase prices paid by U.S. shoppers, since importers typically pass along a share of the cost of those higher taxes to consumers.

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(LOS ANGELES) — Multiple fires raging across the Los Angeles area will cost insurers as much as $30 billion, Wells Fargo and Goldman Sachs estimated in a report released this week.

After accounting for non-insured damages, the total costs will balloon to $40 billion, the report said.

The ongoing fires, according to analysts, “appear to already be the costliest wildfire event in California history.”

The forecast would make the fires one of the 20 costliest natural disasters in U.S. history, when calculated as a share of the nation’s gross domestic product, analysts added.

The wildfires have left a path of wreckage in their wake. More than 12,000 homes and other structures have burned down in the fire, the California Department of Forestry and Fire Protection said.

At least 24 people have died and more than a dozen others remain unaccounted for as multiple wildfires, fueled by severe drought conditions and strong winds, continue to burn.

Thousands of firefighters are battling wildfires across 45 square miles of Los Angeles County. About 92,000 people remain under mandatory evacuation orders and another 89,000 are under evacuation warnings.

A rise in high-cost natural disasters has strained insurers and helped send home insurance premiums nationwide soaring, experts previously told ABC News. Plus, a recent bout of acute inflation has made homebuilding and repairs more expensive, they noted, exacerbating the cost crunch for insurers.

Industry unrest roiling the insurance market in California demonstrates the role climate change has played in skyrocketing premiums and struggling insurers, some experts said.

The average home insurance price jumped a staggering 43% in California from January 2018 to December 2023, S&P Global found last year.

Over recent years, many insurers have reduced coverage or stopped offering it altogether in California as wildfire risks have grown. With more frequent and intense wildfires, insurers face the prospect of more claims and higher costs.

While wildfires are a natural and necessary part of Earth’s cycle, climate change and other more direct human influences have increased their likelihood. Climate change is making naturally occurring events more intense and more frequent, research shows.

Los Angeles residents and homes remain under threat from the wildfires.

A “particularly dangerous situation” with a red flag warning will go into effect in western Los Angeles County and most of Ventura County on Tuesday, weather officials said, with winds threatening to further fuel historic Southern California wildfires.

ABC News’ Kevin Shalvey, David Brennan, Emily Shapiro, Meredith Deliso, Max Golembo, Matthew Glasser and Julia Jacobo contributed to this report.

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(NEW YORK) — TikTok mounted a last-ditch effort at the Supreme Court on Friday meant to stop a ban of the app set to take effect within days — but the platform’s arguments may have landed with a thud.

A majority of the justices appeared inclined to uphold a federal law that would ban the company unless it divests from China-based parent Bytedance.

TikTok has challenged the law on First Amendment grounds, claiming that a ban would limit free-expression rights on a platform used by one of every two Americans. Lower courts, however, have found merit in security concerns about potential data collection or content manipulation that could be undertaken by the Chinese government.

If the court challenge fails and TikTok forgoes a sale, the ban would take effect on Jan. 19, a day before the inauguration of President-elect Donald Trump.

Experts who spoke to ABC News said the measure would not penalize individuals for accessing or using the app, even after the ban takes hold.

Here’s what to know about exactly how the potential ban would work, and how users could still access TikTok, according to experts:

How exactly would the TikTok ban work?

The law potentially banning TikTok — the Protecting Americans From Foreign Adversary Controlled Applications Act — cracks down on the app by targeting third-party companies vital to the functioning of the platform.

Specifically, the law would restrict app stores and hosting companies, which provide the digital infrastructure on which web services like TikTok depend.

Mandatory withdrawal of the app from major app stores, such as those maintained by Google and Apple, would bar new users from downloading the app and prevent existing users from updating it.

Without updates, the app would degrade in quality over time through inconveniences such as video-loading delays and performance glitches, some experts said.

“If the app were not able to download updates, it would eventually become obsolete,” Qi Liao, a professor of computer science at Central Michigan University, told ABC News.

A separate stipulation would also make it illegal for hosting companies to provide services for TikTok — and the measure offers a fairly broad characterization of such firms.

Hosting companies “may include file hosting, domain name server hosting, cloud hosting, and virtual private server hosting,” the law says.

TikTok would stop functioning if the firm’s U.S.-based hosting companies stopped providing services, experts said.

“For you to pull up TikTok content on your phone, somebody has to be hosting that,” said Timothy Edgar, a computer science professor at Brown University and a former national security official.

At least in theory, however, the social media giant could establish partnerships with hosting companies outside the U.S., putting them out of reach of U.S. enforcement, the experts added.

Such a move would keep TikTok available to U.S. users, but the service would likely be slower and glitchier as the digital infrastructure moves further away, they added.

“The whole point of hosting content is to have it close to users,” Edgar said. “It certainly wouldn’t work in any kind of smooth way.”

Considering potential legal liability, TikTok will likely opt against efforts to preserve its U.S.-based platform in modified form, Edgar added. Instead, he said, services may simply come to a halt, as they did in India in the immediate aftermath of the country’s 2020 ban.

“You’ll get a message saying, ‘Oh, it looks like you’re using the app in the U.S. It’s not available in your country,” Edgar said.

TikTok did not immediately respond to ABC News’ request for comment.

Would TikTok users be able to access the app after the ban?

No matter the extent of potential service interruptions, users would still be able to access TikTok after the ban by using workarounds, experts said.

Users who do so will face technical hurdles and reduced app quality, Liao said. For some, that will likely prove a formidable deterrent; but others may seek out TikTok anyway.

“If they really want to use it, the user will find a way to use it,” Liao said.

Users giving it a shot can rest assured that the conduct is perfectly legal, the experts said.

“If you’re an ordinary user with TikTok on your phone, you’re not a criminal,” Edgar said. “There’s no penalty at all.”

ABC News’ Devin Dwyer contributed to this report.

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(NEW YORK) — Online holiday shopping soared to a fresh record high in 2024, driven by an array of e-commerce discounts and adoption of AI-fueled shopping assistants, according to data released on Tuesday by Adobe.

E-commerce sales topped $240 billion in November and December, climbing nearly 9% when compared with the gift-buying season a year prior, data showed.

The data indicated that three product categories accounted for more than half of the online holiday spending: electronics, apparel and home goods.

Spending on cosmetics totaled nearly $8 billion, jumping more than 12% compared to a year prior. That marked the largest year-over-year spending increase for any product category, the data showed.

Discounts helped drive strong sales for some high-priced items, Adobe said, pointing to a 20% jump in units sold for expensive goods.

The fresh data indicated a spike in use of shopping assistants powered by generative AI, suggesting the technology has seeped into the retail sector’s busiest time of the year.

Traffic to retail sites from generative AI-powered chatbots skyrocketed 1,300% over November and December when compared to the same period a year prior, the data showed.

The share of consumers arriving via AI shopping assistants remains modest, however, Adobe said. Shoppers arrived at retail sites via links shared by the chatbots.

“The 2024 holiday season showed that e-commerce is being reshaped by a consumer who now prefers to transact on smaller screens and lean on generative AI-powered services to shop more efficiently,” Vivek Pandya, a lead analyst at Adobe Digital Insights, said in a statement.

The e-commerce data comes weeks after initial indicators pointed to a robust holiday shopping season.

Overall holiday spending surged in 2024, blowing past expectations and outpacing customer purchases over the gift-buying season last year, according to data released by Mastercard SpendingPulse last month.

The end-of-year flex of consumer strength marks the latest indication of resilient U.S. buying power, which has kept the economy humming despite a prolonged stretch of high interest rates.

Gross domestic product grew at a solid 2.8% annualized rate over three months ending in September, the most recent quarter for which data is available.

The labor market has slowed but proven sturdy. The unemployment rate stands at 4.2%, a historically low figure.

Consumer spending accounts for nearly three-quarters of U.S. economic activity.

The increase in holiday spending coincided with an initial bout of relief for borrowers, as the Federal Reserve cut interest rates by a total of one percentage point over the final few months of the year.

However, interest rates still stand at a historically high level of between 4.25% and 4.5%.

Lower interest rates typically stimulate economic activity by making it easier for consumers and businesses to borrow, which in turn fuels investment and spending. But interest rate cuts usually influence the economy after a lag of several months, meaning the recent lowering of rates likely had little impact on holiday spending.

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(NEW YORK) — Facebook plans to replace its fact-checkers with “community notes,” a move that Meta CEO Mark Zuckerberg said would allow the social network to return “to our roots around free expression.”

“We’re replacing fact checkers with Community Notes, simplifying our policies and focusing on reducing mistakes,” Zuckerberg said on Tuesday. “Looking forward to this next chapter.”

The changes, which will also be in place for Instagram and Threads, will lift restrictions “on some topics that are part of mainstream discourse” and will focus the company’s “enforcement on illegal and high-severity violations,” Joel Kaplan, chief global affairs officer, said in a blog post.

Meta executives sought in their statements to tie the update to what they described as a sea change in public discourse accompanying the rise of President-elect Donald Trump’s brand of politics.

Fact-checkers who were put in place in the wake of Trump’s 2016 election have proven to be “too politically biased” and have destroyed “more trust than they’ve created,” particularly in the United States, Zuckerberg said.

“The recent elections also feel like a cultural tipping point towards once again prioritizing speech,” Zuckerberg said.

The decision also follows Zuckerberg recent meeting with Trump at the president-elect’s private Mar-a-Lago club in Florida. And Meta is donating to Trump’s presidential inaugural committee, marking a first for the company.

The shift in policy mirrors a series of updates that Elon Musk — a Trump ally — made after purchasing rival social network Twitter, which he’s since rebranded as X.

Kaplan on Tuesday praised the approach Musk has taken, saying X under its new owner has empowered its “community to decide when posts are potentially misleading and need more context.”

“We think this could be a better way of achieving our original intention of providing people with information about what they’re seeing — and one that’s less prone to bias,” Kaplan said.

As the company’s fact-checking capabilities have grown, they have expanded “to the point where we are making too many mistakes,” which in turn has frustrated many of the social networks’ users, Kaplan said.

“Too much harmless content gets censored, too many people find themselves wrongly locked up in ‘Facebook jail,’ and we are often too slow to respond when they do,” he said.

ABC News’ Michael Kreisel, Zunaira Zaki and Chris Donovan contributed to this report.

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(NEW YORK) — Facebook plans to replace its fact checkers with “Community Notes,” a move that Meta CEO Mark Zuckerberg said would allow the social network to return “to our roots around free expression.”

“We’re replacing fact checkers with Community Notes, simplifying our policies and focusing on reducing mistakes,” Zuckerberg said on Tuesday. “Looking forward to this next chapter.”

The changes, which will also be in place for Instagram and Threads, will lift restrictions “on some topics that are part of mainstream discourse” and will focus the company’s “enforcement on illegal and high-severity violations,” Joel Kaplan, chief global affairs officer, said in a blog post.

As the company’s fact-checking capabilities have grown, they have expanded “to the point where we are making too many mistakes,” which in turn has frustrated many of the social networks’ users, Kaplan said.

“Too much harmless content gets censored, too many people find themselves wrongly locked up in ‘Facebook jail,’ and we are often too slow to respond when they do,” he said.

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

ABC News’ Michael Kreisel and Zunaira Zaki contributed to this report.

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