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The Morning Ledger: Corporate Profits Fueled by Tax Cuts, Solid Economy |
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Retailers played a prominent role in corporate profit growth. Target had its best quarterly results in more than a decade in the second quarter. PHOTO: SCOTT OLSON/GETTY IMAGES
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Good morning. U.S. corporate profits soared in the second quarter, lifted by large tax cuts and stronger economic growth than initially reported, write the WSJ's Harriet Torry and Theo Francis.
Tax boost: The lower corporate tax rate was a big driver for swelling company profits. Taxes paid by U.S. companies were down 33% from a year earlier, according to new government data, or more than $100 billion at an annual rate.
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Strong growth: The Commerce Department revised up its estimate of how fast the economy grew in the second quarter, to an annual rate of 4.2% from an earlier estimate of 4.1%. Rising profits could fuel economic growth in the coming months.
Softness elsewhere: If there was a soft spot, it was from the rest of the world. Corporate earnings from outside the U.S. dropped, while domestic earnings climbed.
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The U.S. Commerce Department will release July personal income and spending data, with consumer spending pegged to have climbed 0.4% last month, while incomes grew 0.3%.
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Dollar General Corp. and Lululemon Athletica Inc. are among the companies slated to report earnings today.
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Aston Martin to Drill Down on Debt, Capital Spending After IPO |
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British luxury car maker Aston Martin Holdings UK Ltd., which on Wednesday said it was considering an initial public offering, is working to reduce debt and capital expenditures.
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Once saddled with heavy losses, the manufacturer of James Bond’s car has been profitable for seven consecutive quarters and is generating sufficient cash to fund the development of new models, Aston Martin’s chief financial officer said in an interview with CFO Journal's Nina Trentmann.
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Calpers Names Former California Finance Director as New CFO |
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The California Public Employees’ Retirement System, the nation’s largest public pension fund, named Michael Cohen as its new chief financial officer, CFO Journal's Tatyana Shumsky reports.
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An employee arranges snacks made by Arnott's at a supermarket in Indonesia. Campbell plans to sell its international operations. PHOTO: DIMAS ARDIAN/BLOOMBERG NEWS
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Campbell Soup Co. plans to sell its international operations and refrigerated-foods business, abandoning efforts to become a more fresh-oriented company and leaving the door open to a full sale.
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Starbucks Corp. is putting its decadent Frappuccino on a diet, looking to reduce the drink’s high sugar levels, which have scared away increasingly health-conscious consumers and hurt sales.
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Apple Inc. has acquired Akonia Holographics, a start-up making holographic lenses. The deal points to Apple's broader ambitions in a sector that is a growing focus for technology companies, CNBC reports.
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Japan’s SoftBank Group Corp., which was in talks earlier this year to take a stake in Chinese electric-vehicle maker NIO Inc., has decided not to invest in the startup’s initial public offering.
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Telecommunications company TPG Telecom Ltd. will merge with rival Vodafone Hutchison Australia in an effort to challenge the country’s two large operators.
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Accounting firm PricewaterhouseCoopers LLP has launched a program that allows some new recruits to work the hours they want, reports the BBC.
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President Trump talked with Mexican President Enrique Peña Nieto on the phone in the Oval Office in Washington, D.C., U.S., August 27, 2018. PHOTO: KEVIN LAMARQUE/REUTERS
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The U.S.-Mexico trade deal announced by the two countries’ leaders this week now faces scrutiny from their respective legislators, who ultimately must ratify the agreement.
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President Trump continued his criticism for a second straight day that Alphabet Inc.'s Google is biased against conservatives, but said he prefers not to pursue regulation of the internet giant.
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The U.S. Commodity Futures Trading Commission ordered BNP Paribas SA to pay a $90 million civil penalty after settling charges against BNP Paribas Securities Corp., for attempted manipulation of a swap benchmark used in pricing interest rate products, Reuters reports.
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FASB Simplifies Rules Governing Accounting For Cloud Services |
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The Financial Accounting Standards Board on Wednesday simplified the rules governing how companies account for the cost of implementing a cloud computing service arrangement, reports CFO Journal’s Tatyana Shumsky.
The revised guidance aligns all three practices that are common in how companies implement cloud computing. It also fills a gap in U.S. accounting rules that concerns how companies treat the service component of implementing cloud computing.
Companies can now apply the same approach to capitalizing implementation costs incurred in a hosting arrangement that includes a license to hosted software, or to costs incurred to develop or obtain internal-use software, or to a cloud hosting arrangement that is a service contract. Public companies that follow a calendar-year reporting schedule must implement the new rules for annual and quarterly filings in 2020.
The accounting standard update comes as companies large and small are increasingly moving their information technology infrastructure to the cloud. The global market for cloud services grew 19% to $260.2 billion last year, and is on pace to reach $411.4 billion by 2020, according to Gartner Inc.
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A John Deere factory in Grovetown, Ga., U.S., July 2018. PHOTO: MICHAEL HOLAHAN/ASSOCIATED PRESS
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The tone between the U.S. and Canada took an optimistic turn on Wednesday as the two countries signaled they were on track to meet a tight Friday deadline to revise the North American Free Trade Agreement.
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