AMC Entertainment, the world’s largest theater chain, has been able to resume operations in 530 of its 600 U.S. theaters but that hasn’t stopped the company from bleeding cash. The company on Monday reported a third-quarter loss of $905.8 million, after its theater operations in the United States were suspended for nearly two-thirds of that time because of the coronavirus pandemic. Revenues totaled $119.5 million for the three-month period, a 91 percent drop from the same period last year.
The company, based in Leawood, Kan., also announced via a filing with the Securities and Exchange Commission earlier in the day that it would look to sell some 20 million shares in order to secure $50 million in new capital. Last month, AMC warned investors that it might have to file for Chapter 11 bankruptcy because of the extreme nature of its losses. Shares fell 9 percent at the end of trading on Monday.
“The duration and impact of this pandemic are still affecting us to this day and are certain to continue to affect our results going forward,” AMC’s chief executive, Adam Aron, said in a statement. “The liquidity-enhancing and leverage-reducing actions that we already have taken and will further need to take, combined with our relentless focus on efficiency and cash management, are all crucial to navigating through this storm.”
While AMC has opened 90 percent of its theaters in 44 of the 45 states it operates in, moviegoers haven’t returned to theaters as expected and Covid protocols have forced the chain to take on additional costs while having fewer paying customers. (The chain has also closed theaters in several European countries because of rising virus cases.)
AMC reported that domestic attendance was 97 percent below the prior year’s third quarter. Since reopening, the chain has sold 10 million tickets and, according to Mr. Aron, it has not experienced one instance of coronavirus spread linked to its theaters.
With reduced consumer demand and Los Angeles and New York City still shut down, the Hollywood studios have chosen to push many of their films into 2021 or sell them to the various streaming services. The latest blow occurred last month when MGM announced that the 25th film in the James Bond franchise, “No Time to Die,” would be postponed again until April 2021. It was initially supposed to open in April 2020 and then was delayed until November because of the pandemic.
The cleaning products section of the grocery store may look more stocked these days than during the first weeks of the pandemic, when panic-buying left aisles of bleach, hand sanitizer and disinfecting wipes eerily bare. Nevertheless, as coronavirus cases surge, people keep reaching for the disinfectant to sanitize everything — and suppliers are still struggling to meet the demand.
That has been a boon for Clorox, which on Monday reported a 27 percent jump in sales during the first quarter of its 2021 fiscal year compared with the same period last year, and posted double-digit growth in eight of its 10 business units. But as its products fly off the shelves, Clorox said it was still racing to keep up.
“We’re still not at a point where we can fully meet ongoing elevated demand,” Lisah Burhan, vice president for investor relations, said on an earnings call. The company said it expected the shortages to persist through the end of the year.
Clorox also said it benefited from people cooking and grilling more — and filling up more bags of trash — while hunkered down at home. The company’s household products division, which includes the Glad garbage bag brand and the Kingsford charcoal grilling line, jumped 39 percent in the first quarter compared with last year.
A group of 11 founders, investors and business leaders from the technology industry endorsed Democratic presidential nominee Joseph R. Biden Jr. in a letter published on Monday, saying he would support small businesses, foster unity and “govern based on facts and reason, not fear and impulse.”
Mark Cuban, the mogul known for his appearances on “Shark Tank,” signed the letter alongside Joe Gebbia, co-founder of home rental start-up Airbnb; Daniel Lubetzky, founder of food maker Kind Snacks; Christina Sass, co-founder of coding start-up Andela, and seven others. Nearly 1,000 people had signed the letter early on Monday, Ms. Sass said in an email.
Before President Trump’s election in 2016, tech companies largely avoided politics, fearing alienating customers, investors and employees. But that has changed in recent years as tech employees became more vocal about their political views, culminating in a tense election season that has put many leaders in the position of picking a side.
In the endorsement, Jillian Manus, an investor at Structure Capital, a Silicon Valley venture capital firm, described herself as a lifelong Republican. But, she wrote, “there is only one option. Joe Biden and Kamala Harris will empower the next generation of innovators to solve our common challenges.”
Some in the tech industry have supported President Trump. Palmer Luckey, a former executive at Facebook and Oculus VR, hosted a fund-raiser for Mr. Trump last month. Doug Leone, an investor at Sequoia Capital, has donated to Mr. Trump’s campaign. Peter Thiel, a prominent investor who vocally supported Mr. Trump in 2016, has been silent this time around.
Like retailers, some banks are boarding up their storefronts to brace for the civil unrest they fear could accompany Election Day on Tuesday.
In cities including Boston, New York, Philadelphia and Washington, banks have placed plywood over glass windows in some locations and increased their security preparations. In most cases, those branches are continuing to serve customers and operate normally, bank representatives said.
On Pennsylvania Avenue, about a mile from the White House, the NIH Federal Credit Union, which serves health care workers, closed the A.T.M. at its branch and boarded it up “due to concerns of potential unrest,” the credit union said in a note to customers. The branch is still running but will close an hour early, at 3 p.m., on Election Day.
Wells Fargo, which operates more branches in the United States than any other bank, said it boarded up the glass at a “small number of branch locations in select cities” because of concerns about “the possibility of postelection demonstrations.” The branches will continue operating as usual, a bank spokesman said.
Citizens Bank, a regional bank with nearly 300 branches in Pennsylvania — a fiercely fought-over battleground state — said it boarded up branches in areas where it saw “the potential for disruption.” On Twitter, people shared photos and reports of other banks, such as the regional giant Santander, covering up their windows.
Santander boarded up windows “at select locations in major city centers,” a spokeswoman said, and it planned to close its branches at 2 p.m. on Tuesday.
America’s two largest banks, Bank of America and JPMorgan Chase, declined to comment on their security preparations. A spokeswoman for Citigroup, the third largest, said Citi was “prepared to swiftly close branches should civil unrest or protests put our staff and customers at risk.”
Some bank branches have already been scathed by protests. In Downtown Brooklyn, along a busy commercial corridor on Fulton Street, glass was shattered last week at a Bank of America branch during protests over the death of Walter Wallace Jr. Mr. Wallace, a Black man with mental health issues who was armed with a knife, was fatally shot by police officers in Philadelphia, in a conflict captured on video.
On Monday, the damaged Bank of America branch in Brooklyn was boarded up and closed.
Voters in California will decide on a dozen ballot initiatives this election cycle, some of which could have profound implications for business. The state is by itself the world’s fifth-largest economy, and can set regulatory standards that signal how policy winds will blow in the rest of the country.
So it’s worth paying attention to the local political tides, even with the focus on the White House. Some $650 million has been spent on California ballot propositions this election cycle, in what David McCuan of Sonoma State University calls “the second most expensive political exercise in the free world.”
The DealBook newsletter looks at three initiatives that could be consequential for companies beyond California’s borders:
Prop. 15: Tax most large commercial and industrial properties based on market value, instead of purchase price. The Chan-Zuckerberg Initiative, Mark Zuckerberg’s family foundation, gave more than $6.3 million in support, noting that a tenth of landowners would pay more than 90 percent of the tax. The California Chamber of Commerce opposes it, arguing that it would harm small businesses and lead to higher food and energy prices. California capped property tax increases in the 1970s, inspiring similar moves elsewhere; if the initiative passes, local governments desperate for revenue could follow the state’s lead once again.
Prop. 22: Make app-based drivers independent contractors. A consortium of gig companies — including DoorDash, Instacart, Postmates and Uber — has spent more than $200 million to support the proposition, which would allow the companies to avoid classifying their drivers as employees. The fight already serves as a harbinger of wider debates about the flexibility and security of gig work. The Biden campaign cites California’s approach as a model.
Prop. 24: Expand privacy laws and create a state data protection agency. Backers of the plan include the former Democratic presidential candidate Andrew Yang, Mayor London Breed of San Francisco and the real estate tycoon Alastair Mactaggart. Big Tech is mostly quiet about it, but some lawyers for Google and Quora individually signed a letter opposing the initiative. Critics complain that the proposal puts the onus on individuals to opt out and might turn privacy into a luxury item. It would codify an existing law “riddled with problems,” says Eric Goldman, a co-director of the High Tech Law Institute at Santa Clara University.
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Stocks rose on Monday, with Wall Street rebounding from its sharpest weekly decline since March and global benchmarks climbing ahead of what’s likely to be a turbulent week with the U.S. presidential election on Tuesday.
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The S&P 500 rose 1.2 percent after earlier swinging between gains of as much as 1.8 percent and as little as 0.4 percent. The tech-heavy Nasdaq composite swung from a gain to a small loss and back again, and shares of big technology stocks like Amazon and Apple were volatile.
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In Europe, key benchmarks including the Stoxx Europe 600 and the FTSE 100 gained more than 1 percent.
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Wall Street is coming off its second monthly decline in a row in October. Shares in the United States and Europe had been dragged lower by rising pandemic cases, new shutdowns, a sell-off in large technology stocks, and inaction on a new fiscal stimulus plan from lawmakers in Washington.
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The U.S. election has added a dose of uncertainty to the financial markets, at least in the short-run as investors worry about the prospect for a contested election or potential unrest over the outcome.
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The coming week will bring several major developments: voting in the election ends on Tuesday, the latest assessments from the Federal Reserve and Bank of England are both due on Thursday, and the Labor Department’s report on job growth in October is scheduled for Friday.
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In Britain, business leaders are calling for additional government support after a new lockdown for England was announced Saturday by Prime Minister Boris Johnson. Pubs, restaurants and most retail shops must close beginning Thursday through at least Dec. 2, although the plan must still be approved by Parliament. The government’s furlough program, which provides up to 80 percent of employee salaries and was scheduled to expire on Nov. 1, will be extended another month.
The nation is on edge as the bitter presidential contest finally nears an end, the latest flash point in a bruising year that has included the pandemic and widespread protests over social justice. Anxiety has been mounting for months that the election’s outcome could lead to civil unrest, no matter who wins.
In the retail industry, many companies are not simply concerned about possible unrest — they are planning for it, The New York Times’s Michael Corkery and Sapna Maheshwari report, by boarding up some stores, training staff on how to de-escalate tension among customers, and trying to identify which locations they’ll need to close in case violence does break out.
These are not simple decisions. Retailers can risk alienating their customers by erecting plywood barriers, particularly if the anticipated unrest does not materialize.
But businesses have already sustained at least $1 billion in insured losses from vandalism this year, largely set off by the killing of George Floyd by a Minneapolis police officer in May, according to one estimate. It means 2020 could be the costliest period of civil unrest in history, likely surpassing damages during the 1992 riots in Los Angeles and many of the civil rights protests of the late 1960s.
Here’s what businesses have said, so far, about their preparations:
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Nordstrom, the high-end department store chain, said it planned to board up some of its 350 stores and hire extra security for Election Day.
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Tiffany & Company, the luxury jeweler, said that “windows of select stores in key cities will be boarded in anticipation of potential election-related activity.”
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Saks Fifth Avenue said it was “implementing additional security measures at certain locations in the event of civil unrest due to the current election.”
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The iconic Macy’s location in Manhattan’s Herald Square was boarded up on Friday.
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Target, with about 1,900 stores, said in a statement, “Like many businesses, we’re taking precautionary steps to ensure safety at our stores, including giving our store leaders guidance on how to take care of their teams.”
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A spokesman for CVS, which operates nearly 10,000 stores, said: “Our local leadership teams are empowered to take steps that they determine will best support the safety of our stores, employees and customers. This includes the option to board select store locations.”
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Gap Inc., with more than 2,000 stores in North America, said it had “contingency plans set in place for any issues that may arise and will continue to monitor the situation carefully and closely next week.”
Economists are expressing concern over how the World Bank and International Monetary Fund have failed to support less-affluent countries through the pandemic.
Despite promises this year by these two deep-pocketed organizations to help poorer countries through the pandemic, funds have been slow to materialize.
The World Bank has doubled its lending over the first seven months of 2020 compared with the same period last year, but it has been slow to distribute the money, according to research from the Center for Global Development. Of the $280 billion lent out by the I.M.F., only $11 billion has been sent to low-income countries.
Economists are warning that immense relief is required to prevent humanitarian catastrophes in poorer countries, and to ensure that the 60 percent of the world that is classified as an emerging market by the I.M.F. does not incur lasting damage.
If no serious steps are taken, the pandemic could push 150 million people into extreme poverty by next year, the World Bank has warned, the first increase in two decades.
“A lost decade of growth in large parts of the world remains a plausible prospect absent urgent, concerted and sustained policy response,” concluded a recent report from the Group of 30, a gathering of international finance experts.
A resurgence of the coronavirus in France risks setting off a deeper-than-expected downturn in the country just as it was starting to see a fragile recovery, the International Monetary Fund said Monday.
New restrictions to keep the virus from spreading, including curfews and a second nationwide confinement announced last week, are likely to keep economic activity lower than where it was before the pandemic, the fund said in its 2020 report on France, the eurozone’s second-largest economy.
“The outlook has weakened in the face of a second wave of infections and downside risks are large,” the organization said. Should a third wave of the virus hit the country going forward, the prospects for a rebound would be even more difficult, the fund cautioned.
France has suffered one of the worst downturns of any country in Europe as the breadth and durations of lockdowns dealt a blow to activity, especially tourism and the auto and aerospace sectors, which make up a large swath of activity.
The government put in place an emergency support program worth around 500 billion euros (about $582 billion) to keep businesses from collapsing and to prevent mass unemployment. The aid helped the economy bounce back in the summer, but “additional fiscal stimulus, through temporary and well-targeted measures, may be needed as the situation unfolds,” the fund said.
Even with the assistance, the economy is expected to contract in the fourth quarter, and output will probably decline by around 10 percent over all in 2020, the fund said.
The economy could rebound next year by 5 to 6 percent, at which point the government should rethink its aid program to avoid allowing “zombie firms” that have grown dependent on financial aid from dragging down an overall recovery, Jeffrey Franks, the head of the I.M.F. mission for France, said during an online media briefing.
As the economy recovers, the private sector, rather than the government, should probably take the lead on deciding which firms are viable and which ones are headed for bankruptcy, he added.
The depth of any recovery will depend on the evolution of the measures used to contain the pandemic, the I.M.F. added. Other risks, it said, include a potentially severe economic fallout from Brexit, rising social tensions and the acceleration of de-globalization developments.
In the meantime, France isn’t creating enough jobs to offset the numbers of people looking for work. The fund urged the government to do more to lift employment, especially for low-skilled and young people who are vulnerable to being shut out of the labor force for long periods.
Whether you’re pulling for four more years or a new occupant in the Oval Office, you may be feeling anxiety how the election results might affect your wallet. But it’s no time to act rashly when it comes to personal financial decisions, writes the “Your Money” columnist Ron Lieber.
Mr. Lieber spoke to financial planners who had, in previous careers, worked in government jobs under both Republicans and Democrats. They offered a few helpful pointers:
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Hold off on any major decisions. “Emotions are really good at raising questions and really bad at answering them,” said Zach Teutsch, a financial planner in Washington. It’s true in life, and it’s certainly true with financial decisions. Try not to make any big ones anytime soon.
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Don’t overestimate change. It’s easy to overestimate how much change is possible in the first year of any presidential term, especially for things that can hit you squarely in the wallet, like taxes, retirement rules or health care. It would be foolish to, say, fundamentally alter your retirement savings strategy in anticipation of a change to some or another tax rule.
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Remember why you invest in the first place. Stocks can lose a lot of value in a short period. But over decades, they tend to deliver enough growth to allow you to achieve long-term goals, like being able to retire and live off the money. That, however, happens only if you have the courage (and discipline and leftover income) to save regularly and don’t yank money out when you think something scary is going to happen.
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Safeguard money you know you’ll need soon. If you have money in stocks that you will need in the next few years, you should rethink that — but not because of what could happen on Tuesday or because of the way politics or policy might affect the markets. It’s simply better to put money you know you’ll need soon into something less volatile.
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Consider charity. If the stock market has been good to you — from the Obama administration into the Trump administration — maybe there is some money left over for others whose paths have been rockier.
You may have heard that Tuesday is Election Day in the United States. Here’s a look at the timing of results. (The New York Times will be hosting a live, four-hour broadcast of “The Daily” starting at 4 p.m. Eastern). Believe it or not, there are other things happening …
It’s another big week for corporate earnings, with a quarter of S&P 500 companies opening their books. Noteworthy reports include PayPal on Monday; Saudi Aramco on Tuesday; Qualcomm on Wednesday; Alibaba, AstraZeneca, General Motors and Uber on Thursday; and Marriott and Toyota on Friday. (Watch for unexpected announcements from companies looking to bury bad news amid the electoral distractions.)
On Thursday, economists expect the Federal Reserve to leave interest rates the same, but provide clues about the strength of the recovery. The same day, the Bank of England may introduce new stimulus measures as lockdown begins and Brexit (remember that?) looms.
Ant Group, which raised more than $34 billion in the biggest initial public offering on record, begins trading in Hong Kong on Thursday. (It’s not clear when trading will begin in Shanghai.) Based on the rush to buy shares in the Chinese fintech giant, it could be a frenzied first day.
The U.S. jobs report on Friday is expected to show a gain of 600,000 jobs in October, the fourth consecutive month of slowing growth in payrolls, which remain more than 10 million lower than before the pandemic.
With Election Day imminent, a prominent Texas business leader last week appeared to urge her employees to consider voting for Donald J. Trump and other Republican candidates.
Barbara R. Smith, chief executive of the Commercial Metals Company, a manufacturer in Irving, Texas, suggested on Thursday in a memo to workers that a Democratic president and Senate could diminish the company’s future earnings by $200 million a year.
“There are sharp differences between the two candidates’ approaches toward the economy, trade, national security and entitlements,” she wrote, adding, “I urge you to consider each party’s platform and its impact on this great company you have helped to build.”
The memo, a copy of which was reviewed by The New York Times, was distributed to thousands of Commercial Metals employees around the United States, according to one recipient.
The memo left some Commercial Metals employees uncomfortable, according to two people with knowledge of the reactions, leading Ms. Smith to clarify her intentions, one of them added.
In a follow-up note to employees on Monday, Ms. Smith told employees that “the candidates you vote for and the policies you support are entirely your own business, but whatever your political beliefs, what is most important is that you vote.”
In the original memo, Ms. Smith wrote that the company’s government affairs experts had reviewed the possible impact of various election outcomes, and found that a “unified government” scenario — involving a Democrat in the White House and at least three additional Democratic seats in the Senate — could lead to an increase in corporate taxes of up to 35 percent, a pivot to greener industries that could harm metals manufacturers and a removal of Trump-era tariffs that have benefited U.S. steel and aluminum companies. Those actions, taken together, could hurt the company’s bottom line, the analysis found.
Joseph R. Biden Jr. has said that if he were to win the presidency, he would push for an increase in corporate taxes to 28 percent from their current level of 21 percent under Mr. Trump. While Mr. Biden has embraced the idea of spending government money on renewable energy and has criticized Mr. Trump’s tariff policies for alienating allies, he has not taken clear positions on either a carbon tax or tariff reforms.
A trustee overseeing a $13.5 billion compensation fund on Monday ordered emergency payments of up to $25,000 to some of the people who lost property or suffered injuries in wildfires caused by Pacific Gas & Electric, the California utility.
The trustee, John K. Trotter, said the payments, which will go to at least 15,000 people, had become necessary because some fire victims who have been struggling in recent years have become destitute during the coronavirus pandemic, which has forced large parts of the economy to seize up.
“The general state of affairs for these people is so dire it’s almost hard to describe,” said Mr. Trotter, a retired state court justice who was appointed to oversee the fund by a federal bankruptcy court. “Covid and this season’s wildfires have just added to their misery. If this does not qualify as a humanitarian crisis, I don’t know what will.”
PG&E sought bankruptcy protection in January 2019 after accumulating an estimated $30 billion in liability for wildfires caused by its equipment. The company emerged from bankruptcy in July.
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