White House Tax Plan Causing Quite the Stir; Twitter’s Very Good Day/Quarter; Silicon Valley Start-Up Eats $1.6M for Discrimination

So taxing…

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Image courtesy of Stuart Miles/FreeDigitalPhotos.net

The White House whipped out its opening bid for what it’s calling the “biggest tax cut.” Well, in U.S. history anyway. So who’s supposedly getting a nice break? The middle class, for one, along with some businesses and, naturally, some wealthy individuals, among others.  While President Trump’s top economic adviser Gary Cohn and Treasury Secretary Steven Mnuchin want corporations to pay a 15% tax rate, the plan also calls for a one-time tax payment on earnings that U.S. companies keep outside the U.S. Apparently this new tax cut is meant to be all about simplicity, giving a much-needed boost to the small-business sector while putting some cash back into pockets of the middle-class. Individual rates would change, with the top rate dropping from almost 40% to 35%, and instead of having seven brackets of rates, we’d have just three.  Those cuts sound great, in theory, however, questions remain as to who will be paying for these cuts and how will they be paying for them.

It did what?!

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Image courtesy of Stuart Miles/FreeDigitalPhotos.net

We’ll start with the bad news. Twitter’s year-over-year revenue declined for the first time  ever to $548 million. But miracle of miracle – hey, we are talking about Twitter, after all – the social media company beat analysts expectations on everything else. TWITTER BEAT EXPECTATIONS. While last year’s revenue at this time was a much higher $595 million, it still wasn’t anywhere near dismal expectations of $512 million for this quarter. User growth has been a fiscal thorn in Twitter’s side. But perhaps the social media tide is turning because Twitter added 9 million more monthly active users bringing its grand total to 328 million users. 9 MILLION users added. You know what anaylyst expected? 2.3 million. Twitter effectively blew those estimates out of the water. As for the other numbers, the company earned 11 cents per share when expectations were for one single solitary cent. In other words, Twitter beat those estimates by a dime. Twitter explained that its impressive earnings were due in part to increased political interest – which sounds about right, especially given President Trump’s highly entertaining tendency to tweet before he thinks. Also, Twitter’s efforts to simplify use on the platform and putting greater focus on stamping out abuse seem to have helped matters…and figures.  Naturally, shares enjoyed a much appreciated increase today, soaring way past $16 a share.

Pony up…

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Image courtesy of pakorn/FreeDigitalPhotos.net

Palantir Technologies may be valued at $20 billion, but it’s about to lose $1.6 million of it as part of a settlement with the U.S. Department Labor. Charges were brought against the data-analytics company that it discriminated against Asians. Besides the money the company has to cough up, which will go towards back pay and stock options to affected applicants, Palantir also has to hire eight people, who had previously applied to the company, for two different types of engineering roles. According to the government’s complaint, Asians were “routinely eliminated” on the basis of their resumes and telephone interviews. But apparently, Palantir should consider itself lucky that the case didn’t end up going to court. If it had and lost, the penalties would have been so much worse. That $1.6 million is chump change compared to what it might have been had the company been found guilty. And that would be in addition to being added to a list that bars certain companies from doing business in the government sector. Palantir has so far enjoyed hundreds of millions of dollars from such contracts. Of course, Palantir disagrees with the allegations, refuses to admit to any wrongdoing and claims that it only settled so that it could carry on business without further interruptions. Incidentally, Palantir’s co-founded is Peter Thiel, one of President’s Trump’s biggest Silicon Valley supporters and cheerleaders from the start.

Taser International Shocks Wall Street; Marissa Mayer’s Having a Plentiful Year; Laboring Away

Zap to it…

Image courtesy of digitart/FreeDigitalPhotos.net

Image courtesy of digitart/FreeDigitalPhotos.net

Nothing like accountability to drive earnings up. The big winner amongst the civil unrest that has been infecting our country is Scottsdale-based Taser International. The company just reported strong first quarter earnings that beat expectations. The company reported revenue of $44.8 million with earnings per share of 13 cents, while analysts only expected 7 cents on $40 million in revenue. News of the boffo earnings even sent shares of the company up nearly 10% at one point today. Maybe analysts haven’t seen the news lately, because a lot of that came from Taser’s Axon body cameras  – yeah, they make those too – which, given all the unfortunate events involving law enforcement, are rapidly gaining in popularity. It seems everybody wants law enforcement to don those body cameras from lawmakers to average citizens.Yes, it’s hard to believe it wasn’t just the zappers that led to those great first quarter earnings.  In fact, Taser’s products are so hot lately (no pun intended) that shares are up 83% for the year.

Going green…

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Marissa Mayer had a very good year. Well, in her bank account anyway. However, it could have even been better. The Yahoo chief pulled down about $42 million for 2014, only getting a little more than half of her $2 million target bonus and and close to 70% of her stock awards. She could have made more. A lot more. Like way over $12 million more. Like more than $55 million in total. But, alas, the company stock didn’t do as well hoped. Oh well. Maybe next year. The way it works over at Yahoo, and presumably many other companies like it, is that folks like Ms. Mayer get paid according to how well they perform and if they are able to meet certain goals set by the board. She didn’t exactly meet them but she is not exactly hurting either. Since she took the helm at the company in 2012, Yahoo’s stock more than doubled. It also helps that Yahoo has a big chunk of Alibaba Group, which helped bring in some that $42 million. As for 2015, the Yahoo chief isn’t expected to take in as much since some of that bonus cash was from one time stock and option awards. But she’ll likely still have more than enough for a rainy day.

Labor gains…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Looks like there are a lot less people filing for unemployment benefits, according to the Department of Labor.  In fact, it’s been 15 years since numbers like this have even graced our fickle little economy. The number of people collecting unemployment checks for the very first time fell 34,000 to 262,000 applicants.  Analysts expected that number to be closer to 290,000 people. Employers even added 126,000 people to the payroll. Even the number of people who collect unemployment checks took a nice welcome dive by about 74,000 to 2.25 million people. That’s another figure that hasn’t been this low in almost fifteen years. All that aggravation over March’s numbers that gave us such fiscal economic anxiety turned out to be much ado about nothing. Well, it wasn’t nothing, but at least we can relegate it to a bad, distant memory.