Uber Is Going To Allow Drivers To Ask For Tips, Plus American Airlines Gets Sucker Punched


“Epic, biblical hail storms” — Mike Jackson, CEO of AutoNation, who blamed the nation’s largest car dealer chain’s poor earnings on massive hailstorms that damaged many vehicles. All hail, but no bail from Wall Street.

Big Picture

  • While U.S. stocks finished another strong week mixed, Chinese stocks posted their worst decline since January, in stark contrast to recent rallies in markets across the world

Market Movers

  • Calling last week a roller coaster ride for Sarepta Therapeutics would be an understatement. On Thursday, the company saw 40% of its value wiped out, only to rise 30% on Friday as investors speculate over whether the FDA will approve the company’s drug
  • Shares of Comerica Bank jumped sharply after reports revealed that some investors, including hedge fund Hudson Executive Capital, were pushing for a sale
  • SecureWorks shares hit the public spotlight on Friday, ending a four month tech IPO drought, the longest in seven years (as for the stock’s first day of trading: it was basically flat)



Tech Space is All About Honor Right Now

The good old days of capitalism are back (don’t quote us on that). What we’re trying to say: two giant companies have put aside regulatory and legal squabbles to focus on business. Refreshing? Here’s the story: our favorite quarreling duo, Microsoft and Google, have settled all complaints internally instead of running to regulators. A moment like this would never have been possible under the Ballmer/Schmidt administrations—a more cordial relationship between current CEOs Nadella/Pichai helped heal some wounds. Less like friends, more like worthy adversaries. Google’s statement: “our companies compete vigorously, but we want to do so on the merits of our products, not in legal proceedings.” Well said.

That Escalated Quickly…

China threw a bit of a fit over the weekend, shutting down Apple’s iBooks and iTunes Movies stores in the Chinese market. For some context, China is Apple’s only main growth segment geographically due to market saturation everywhere else. Fewer apps in the Chinese market, which account for 24% of Apple’s revenues, means less sales going forward. And if the segment that grew 99% year over year (yep, that happened in China) starts slowing down, investors won’t be too happy. With China also asking Apple for their iOS source code (Apple said no, of course), all we can ask is “what’s next?”

Uber Win, Passenger Loss?

Honestly, who carries cash anymore? Uber gets that cash can be a hassle—and its transaction-less approach is a key part of its value proposition. Well, was. Uber has potentially ended a major legal threat with a proposed $100 million settlement that would allow the ride-sharing service to continue classifying its drivers as independent contractors instead of employees (that’s a win for Uber, since employees cost a lot more to compensate). Okay, and how does this impact your wallet? The settlement, among other things, would require Uber to allow drivers to have signs asking for tips—which, given how much (or little) Uber drivers make, may become more than optional. Gone could be the days of the carefree, cashless experience that Uber customers love.

American Airlines Gets Sucker Punched

American Airlines reported its first quarter earnings on Friday, and the numbers aren’t easy to look at. Let’s take a look anyways: revenue declined 4% and profits fell a concerning 25%. The culprit? A change in its federal tax bill, amounting to a charge of $417 million (compare this with American’s $700 million net income for the quarter). Yep…that would do it. While low fuel costs helped the company, the strong U.S. dollar did not. An announcement of future share buybacks was not enough to appease investors, and the stock slid almost 5%.





  • Monday: Halliburton, Xerox Earnings; New Home Sales
  • Tuesday: Apple, Twitter, AT&T, Procter & Gamble, eBay, Chipotle, Coach, 3M, Lockheed Martin, Aflac, JetBlue, Spirit Airlines, Office Depot, Buffalo Wild Wings, Panera, Hershey, Fiat Chrysler Earnings; Durable Goods Orders; S&P Case-Shiller Home Price Index; Consumer Confidence
  • Wednesday: Facebook, Comcast, PayPal, Boeing, Barclays, Hilton, Marriott, Dr. Pepper, Texas Instruments, Six Flags Earnings; Fed Meeting Announcement; International Trade; Pending Home Sales
  • Thursday: Amazon, LinkedIn, Gilead, Amgen, Altria, MasterCard, UPS, Time Warner Cable, Ford, Honda, Groupon, Pandora Sony, Deutsche Bank, Viacom, Celgene, Baidu, Dow Chemical, Dunkin’ Brands Earnings; U.S. Q1 GDP; Weekly Jobless Claims
  • Friday: Exxon Mobil, Chevron, Sanofi, Phillips 66, Seagate Earnings; Personal Income and Outlays; Employment Cost Index; Consumer Sentiment


Scroll through your Instagram feed, and it’s likely that you’ll see snaps of some pretty tasty looking “clean-eating” food, like your friend Melissa’s chia seed parfait, or the “revitalizing” egg white garden omelette Marco had at brunch this weekend. These days, being healthy is in—but “healthy” is becoming an increasingly subjective term. Some newly published research is revealing a shift in what consumers see as healthy, and food companies are starting to feel it in their numbers:

  • Just a few years ago, low-fat and low-sodium foods were seen as the “right” things to eat. But today, consumers don’t necessarily see fat or salty food as the enemy.
  • A great of example of this shift can be seen in ice cream sales: last year, Dreyer’s saw a 10.8% increase in sales of its full fat ice cream.
  • Recent research has praised dark chocolate for its heart health benefits, and a market research firm predicts that sales will rise by an average annual rate of 8% through 2019.
  • Even former gas station snacks like beef jerky (rebranded as a “protein snack” by some firms) have seen a revival: sales of jerky shot up by a whopping 47% between 2011 and 2015.


Three envelopes are presented in front of you by an interviewer. One contains a job offer, the other two contain rejection letters. You pick one of the envelopes. The interviewer then shows you the contents of one of the other envelopes, which is a rejection letter. The interviewer now gives you the opportunity to switch envelope choices. Should you switch? (Answer)



Dividend — A dividend is a distribution of a portion of a company’s earnings, decided by the board of directors, to a class of its shareholders usually in the form of cash payments, as shares of stock. A company either gets to hold onto its earnings or pay it out to shareholders in the form of a dividend.



Cheerios — The latest brand to try and mix creative marketing with a current event. Key word, “try”. The result of a well-intentioned Prince “rest in peace” tweet with a Cheerio-sized twist: a storm of angry tweeters who generated some bad PR for General Mills, which was forced to delete the tweet and apologize.

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