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    SpaceX adjusts Starlink monthly pricing for residential customers based on service capacity

    Elon Musk’s SpaceX rolled out price changes for residential Starlink customers, according to emails to customers reviewed by CNBC.
    Prices will rise for residential users of its satellite internet service in “limited capacity” areas but will fall for users in “excess capacity” areas, effective April 24.
    SpaceX continues to expand its Starlink network through regular satellite launches and has broadened its product offerings to include maritime and aviation services.

    A Starlink user terminal, also known as an antenna or satellite dish, on the roof of a building.

    Elon Musk’s SpaceX rolled out new prices for residential Starlink customers based on the company’s capacity to deliver service, according to emails to customers reviewed by CNBC.
    The changes, outlined on Tuesday, split residential users of its satellite internet service into areas of “limited capacity” and “excess capacity.” Prices will rise $10 per month, to $120, for users in limited capacity areas, while prices will drop $20 a month, to $90, for those in excess capacity areas. The new pricing will take effect on April 24.

    The company also made changes to pricing for its RV customers, increasing the service cost by $15 a month to $150.
    The price adjustments come about a year after SpaceX hiked prices across the board for products and services, citing “excessive levels of inflation.”

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    SpaceX continues to expand its Starlink network through regular satellite launches, with nearly 4,000 launched to date. Its service reached 1 million subscribers in December and it is steadily expanding its product offerings — selling services to residential, business, RV, maritime and aviation customers.
    Earlier this month, SpaceX leadership announced that Starlink “had a cash flow positive quarter” in 2022 as it works to make the business profitable.

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    Starbucks CEO Howard Schultz calls new olive oil coffee drinks ‘transformational’

    Starbucks interim CEO Howard Schultz said the new olive-oil coffee line will be a “market-maker.”
    The drinks will launch in Italy before arriving in some U.S. markets this spring.
    Schultz is stepping down from his interim CEO role in April and will be replaced by Laxman Narasimhan.

    Starbucks’ new line of olive oil-infused coffee drinks could disrupt the industry, interim CEO Howard Schultz told CNBC’s Jim Cramer on Tuesday.
    “This is a transformational moment in the history of our company creating a new category, a new platform,” Schultz told CNBC’s “Mad Money.” He said Starbucks’ new olive-oil coffee, which he conceived after an inspirational trip to Sicily, will be incremental to the business over time.

    The drinks debut Wednesday at the company’s 25 Italy locations. Schultz believes it will be a “market-maker” in an industry that has felt the squeeze of tightening consumer demand. The “Oleato,” which is named after the Italian word for “with oil,” will come to the U.S. this spring, starting in California.
    Alongside olive oil coffee, Starbucks is also unveiling an Oleato espresso martini, which will be available in select locations in Italy, as well as Seattle and New York.
    Schultz is launching the new coffee line ahead of his April departure as interim CEO. Incoming chief executive Laxman Narasimhan will take over the position, though Schultz, 69, will maintain his board seat and act as an ambassador for the Oleato brand.
    “I’ll carry the Starbucks flag and the American flag all over the world for Oleato,” said Schultz, who will be concluding his third tenure as chief executive. “But make no mistake, Laxman is the CEO and at the annual meeting on March 23, there’s only one leader at Starbucks. It’s going to be him.”
    Starbucks’ olive oil coffee comes as the company continues to navigate a tough macro environment, though Schultz has maintained optimism. He noted that the company has added roughly $40 billion to its market cap since he started as interim CEO.

    To be sure, Starbucks has raised prices about 5% to offset inflation, but Schultz said he does not expect any more increases.
    “I’m not worried about inflation going forward, and I might be the only CEO in America that feels like we’re going to have a soft landing,” said Schultz.
    The company has seen sagging international sales after a resurgence in Covid cases in China led to shrinking demand in that market. Going forward, Schultz is anticipating a rebound for China and for consumer demand at large.
    “The wind is at our back,” Schultz said.

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    Walmart CEO Doug McMillon vows to keep private labels priced low to fight inflation

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    Walmart CEO Doug McMillon said he wants to help lower inflationary prices and won’t participate “in a recession if there is one.”
    The company reported fourth-quarter earnings that beat Wall Street’s expectations.
    Walmart is entering its new fiscal year with caution, acknowledging the continued squeeze on consumer demand.

    Doug McMillon, president and CEO of Walmart.
    Adam Jeffery | CNBC

    Walmart CEO Doug McMillon wants to help bring inflationary prices down by keeping his company’s own private brands priced low, telling CNBC’s Jim Cramer Tuesday that the company is “not participating in a recession if there is one.”
    “I think we have historically shown that we can bring prices down,” said McMillon in a “Mad Money” interview.

    McMillon said he would prefer that Walmart’s brand partners and suppliers “step forward” on their own to lower prices, but regardless he wants “to play a role in helping get prices down.”
    The retail giant reported healthy holiday-quarter earnings on Tuesday as it capitalized on inflation-weary consumers looking for cheaper alternatives and discounts. The company reported record annual revenue of $611 billion.
    McMillon told Cramer he was confident that Walmart’s lower-priced products could push other brands to bring down their own prices, even as Walmart and its peers face rising costs.
    “Over time, the market works,” McMillon said. “We believe branded manufacturers and all of our suppliers of all types will have to respond to that market in time.”
    Walmart is proceeding with caution as it heads into the new year, issuing more conservative guidance for the current fiscal year than Wall Street expected.
    “It’s hard to know exactly what the back half of the year will look like,” said McMillon.

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    Nikola will offer a driver-assist system for its trucks starting next year

    Nikola will begin offering an advanced driver-assist system on its electric heavy trucks starting late next year.
    The system, made by Plus and called PlusDrive, is similar to highway driving systems offered by automakers including Tesla, General Motors and Ford Motor.
    Nikola said that several of its fleet customers, including PGT Trucking and Christenson Transportation, have agreed to test prototype PlusDrive-enabled semitrucks.

    Nikola Motor Company Two truck
    Source: Nikola Motor Company

    Nikola will begin offering an advanced driver-assist system on its electric heavy trucks starting late next year, the company said Wednesday.
    The system, made by Plus and called PlusDrive, is similar to the highway driving systems offered by automakers including Tesla, General Motors and Ford Motor – while a human driver must be present and attentive, the system can handle most highway driving tasks on its own, in addition to assisting the human driver in non-highway situations including backing up to loading docks.  

    Plus says its “autonomous driving technology offers the industry’s best-in-class perception system and deep learning models to quickly, accurately, and safely perceive the vehicle’s surroundings, predict what’s coming next, and control the vehicle to make its next move.”
    But a Nikola representative told CNBC the system as it will be integrated into the company’s semitrucks is designed to be an “eyes-on-road, hands-on-wheel” system.
    Nikola CEO Michael Lohscheller said in a release that the electric steering and braking systems already used in the company’s trucks will simplify the integration of Plus’ system, which includes radar, cameras and lidar sensors to detect obstacles around the truck.
    Plus already provides the PlusDrive system to Italian heavy-truck maker Iveco, a longtime Nikola partner. Iveco began testing its own PlusDrive-enabled trucks earlier this month.
    Nikola said that several of its fleet customers, including PGT Trucking and Christenson Transportation, have agreed to test prototype PlusDrive-enabled Nikola semitrucks. The company expects to begin offering PlusDrive on its regular production battery-electric and fuel cell trucks by the end of 2024.

    Nikola is scheduled to report its fourth-quarter and full-year results before the U.S. markets open on Thursday.
    Clarification: Plus’s advanced driver-assist system as integrated into Nikola’s semitrucks is designed to be an “eyes-on-road, hands-on-wheel” system, according to a company representative. An earlier version of this story mischaracterized the functionality.

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    Stocks making the biggest moves premarket: Coinbase, Palo Alto Networks, Toll Brothers and more

    Brian Armstrong, CEO and Co-Founder, Coinbase, speaks during the Milken Institute Global Conference on May 2, 2022. in Beverly Hills, California.
    Patrick T. Fallon | AFP | Getty Images

    Check out the companies making headlines in the premarket:
    Palo Alto Networks — The software company added 9.3% after posting adjusted earnings and revenue for the fiscal second quarter that topped Wall Street expectations. It was the third consecutive quarter of profitability after a decade of losses. Palo Alto Networks’ forecast for fiscal third-quarter adjusted earnings also beat expectations.

    Coinbase – Shares of the cryptocurrency exchange rose more than 1% after Coinbase reported a smaller-than-expected loss for the fourth quarter. Coinbase’s loss was $2.46 per share on $629 million of revenue. Analysts surveyed by Refinitiv were expecting a loss of $2.55 per share on $590 million of revenue. Subscription and services revenue helped offset a quarter-over-quarter decline in trading volumes.
    Keysight Technologies — The electronics company dropped 7.9% after issuing a weaker-than-expected outlook for the fiscal second quarter. Keysight expects earnings per share to be in the range of $1.91 and $1.97 with revenue in the range of $1.37 billion to $1.39 billion, which fall short of FactSet analysts’ estimates of $1.94 and $1.4 billion, respectively.
    Toll Brothers — Shares of the homebuilder rose more than 2% on the back of better-than-expected fiscal first-quarter results. Toll Brothers earned $1.70 per share, beating a Refinitiv consensus estimate of $1.41 per share. Home sales revenue of $1.75 billion also topped expectations of $1.73 billion.
    Logitech — Logitech’s U.S.-listed shares dipped about 1% after UBS downgraded the computer peripherals maker to neutral from buy. “The environment for Logitech is getting incrementally tougher,” UBS said.
    Alcoa — Shares of the aluminum maker climbed nearly 2% after Citi upgraded Alcoa to buy from neutral, citing optimism around China’s economic reopening.

    Intel — Intel shares fell about 1% after the chipmaker cut its quarterly dividend to 12.5 cents per share.  “Prudent allocation of our owners’ capital is important to enable our IDM 2.0 strategy and sustain our momentum as we rebuild our execution engine,” CEO Pat Gelsinger said.
    Stellantis — Shares of the auto group rose more than 2% after Stellantis reported full-year results that beat analyst expectations. The company also approved a 1.5 billion euro share repurchase program.
    CoStar Group — The commercial real estate stock plummeted tumbled 15% in early morning trading after the company issued guidance for the current quarter that fell short of analysts’ estimates, according to StreetAccount. The move also followed confirmation from News Corp. that the two companies are no longer engaged in discussions regarding a potential sale by CoStar of Realtor.com.
    La-Z-Boy — The furniture stock gained 4.6% after its adjusted earnings per share for the fiscal third quarter came in at 91 cents, topping analysts’ estimates of 66 cents, according to StreetAccount. Revenue was $572.7 million, versus the $529.6 million expected.
    Garmin — The fitness tracker maker’s stock gained 4.3% after the company posted fourth-quarter earnings that beat consensus estimates. The company reported consolidated revenue of $1.31 billion, a 6% decrease compared to the prior year quarter, and earnings per share of $1.35. Analysts served by StreetAccount had expected a $1.3 billion in revenue and earnings per share of $1.19.

    — CNBC’s Jesse Pound, Tanaya Macheel and Michelle Fox contributed reporting.

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    Wells Fargo seeks to catch faster-growing rivals by boosting engagement with rich clients

    The service, called LifeSync, lets users create and track progress on financial goals, ingest content tied to their plans and contact their advisors.
    Clients increasingly prefer digital channels to tap financial services, and this tool should enable the bank to boost satisfaction and loyalty.
    Wells Fargo’s client assets in wealth management haven’t grown since the end of 2019, when they stood at $1.9 trillion.

    Pedestrians pass a Wells Fargo bank branch in New York, U.S., on Thursday, Jan. 13, 2022.
    Victor J. Blue | Bloomberg | Getty Images

    Wells Fargo is unveiling a new platform to boost digital engagement with its 2.6 million wealth management clients, CNBC has learned.
    The service, called LifeSync, lets users create and track progress on financial goals, ingest content tied to their plans and contact their advisors, according to Michael Liersch, head of advice and planning at the bank’s wealth division. It will be delivered through a mobile app update in late March, he said.

    “These are the things that will really enhance the client-advisor experience, and they’re not available on the mobile app today,” Liersch said. “This is a really big platform enhancement for clients and advisors to collaborate around their goals and connect what clients want to accomplish with what our advisors are doing.”
    Banks are jockeying to provide their customers with personalized experiences via digital channels, and this tool should enable Wells Fargo to boost satisfaction and loyalty. CEO Charlie Scharf has highlighted wealth management as one source of growth for the company, along with credit cards and investment banking, amid his efforts to overhaul the bank and appease regulators.

    Arrows pointing outwards

    Wells Fargo

    Wells Fargo is a major player in American wealth management, with $1.9 trillion in client assets and 12,027 financial advisors as of December.
    But its client assets haven’t grown since the end of 2019, when they also stood at $1.9 trillion. Under Scharf’s streamlining efforts, Wells Fargo sold its asset management business and dropped international wealth clients in 2021.
    The trajectory of the asset figure “primarily is a reflection of the volatility seen over the last few years,” according to a bank spokesperson.

    During that stretch, its competitors — sometimes referred to as wirehouses — grew by leaps and bounds, thanks to acquisitions, organic growth and new technology. Morgan Stanley saw client assets surge from $2.7 trillion to $4.2 trillion. Bank of America saw balances in its wealth division climb from about $3 trillion to $3.4 trillion.
    With its new offering, Wells Fargo hopes to turn the tide. The bank may eventually opt to offer a financial planning tool to its broader banking population, said Liersch. That would follow the move that Bank of America made in 2019, when it unveiled a digital planning tool called Life Plan.
    “We wanted to solve for that more complex experience first, and then develop the client-directed capability which is absolutely in our consideration set,” Liersch said.

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    Target bets on e-commerce by investing $100 million in hubs to speed up delivery

    Target said it will spend $100 million to build a larger network of sortation centers that speed up and lower the cost of delivering online orders.
    The big box retailer is pressing ahead with its e-commerce strategy, even as it anticipates slower sales.
    Target will report its holiday-quarter earnings Tuesday.

    The Target Corporation logo displayed on a smartphone screen.
    Rafael Henrique | SOPA Images | Lightrocket | Getty Images

    Target said Wednesday it will spend $100 million to build a larger network of supply chain hubs to speed up and lower the cost of delivering online orders.
    The retailer plans to have at least 15 of the facilities, dubbed sortation centers, by the end of January 2026. It already has opened nine, after testing the concept in its hometown of Minneapolis. The expansion will also grow Target’s workforce. On average, more than 100 people work at each sortation center.

    The company is betting on e-commerce growth, despite struggling with a glut of inventory and a noticeable pullback in sales. Target lowered its holiday-quarter outlook and announced plans to cut up to $3 billion in costs over the next three years. It will report fiscal fourth-quarter earnings and its full-year expectations on Tuesday.
    E-commerce sales growth has slowed for the company, too, partially because of the sharp rise during the earlier days of the pandemic, which created tough comparisons. Digital sales increased less than 1% in the most recently reported quarter, which ended in late October. That compares to nearly 29% growth in the year-ago third quarter.
    This week, Target’s retail peers Walmart and Home Depot forecasted a tougher year ahead, after the pandemic-fueled sales boom and as inflation weighs on household budgets. Walmart said it expects same-store sales for its U.S. business to rise by 2% or 2.5%, excluding fuel, in the fiscal year. Home Depot said it expects sales growth for the fiscal year to be roughly flat.
    Gretchen McCarthy, Target’s chief global supply chain & logistics officer, said regardless of the economic backdrop, Target has to keep up with customer expectations — namely getting online purchases conveniently and quickly.
    “We are absolutely tracking consumer spending closely. We’re taking recent trends into account,” McCarthy said, pointing to the retailer’s lowered forecast.

    But, she added, the delivery hubs will help Target better meet customers’ needs, whether they’re shopping online, in stores or using curbside pickup.
    She said up to 40% of packages that go through sortation centers and get delivered by Shipt arrive to customers’ doors next day — and Target aims to get that number higher.
    Over the roughly the past six years, Target has leaned into a strategy of “stores as hubs.” It has turned its approximately 1,950 stores into mini warehouses where employees help pick and pack the majority of the company’s online orders. Nearly 97% of its total sales were fulfilled by a store in the fiscal third quarter, according to company filings.
    As online sales grew, however, Target’s backrooms became crowded with packages. Target began testing sortation centers, a facility where packages arrive from about 30 to 40 nearby stores, get grouped into more efficient delivery routes and get picked up by a third-party carrier or a vehicle of a contract worker for Shipt, a third-party delivery company that Target owns. It opened the first one in 2020 in Minneapolis.
    It has opened sortation centers across major markets in Minnesota, Texas, Colorado, Illinois, Georgia and Pennsylvania. Last month, it opened them in the Chicago and Denver area.
    By switching to the model, Target has cleared space in its backrooms and freed up time for store employees to help customers, McCarthy said. She declined to specify the savings that come from each hub, but said since the sortation centers have opened the company has saved “tens of millions of dollars in last-mile expense.”
    In the coming year, she said Target expects to deliver 50 million packages through the sortation centers — up from 26 million packages in 2022.

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    Fed’s James Bullard pushes for faster rate hikes, sees ‘good shot’ at beating inflation

    St. Louis Fed President James Bullard told CNBC that a more aggressive interest rate hike now would give the FOMC a better chance to bring down inflation.
    The central bank official also said he thinks “we have a good shot at beating inflation in 2023” without creating a recession.
    Bullard advocates for a top rate of nearly 5.4%, about in line with market pricing.

    St. Louis Federal Reserve President James Bullard expressed confidence that the central bank can beat inflation and advocated Wednesday for stepping up the pace in the battle.
    Bullard told CNBC that a more aggressive interest rate hike now would give the rate-setting Federal Open Market Committee a better chance to bring down inflation that, while falling some off the precarious levels of 2022, is still high.

    “It has become popular to say, ‘Let’s slow down and feel our way to where we need to be.’ We still haven’t gotten to the point where the committee put the so-called terminal rate,” he said during a live “Squawk Box” interview. “Get to that level and then feel your way around and see what you need to do. You’ll know when you’re there when the next move could be up or down.”
    Those comments come a week after Bullard and Cleveland Fed President Loretta Mester both said they were pushing for a half percentage point rate hike at the last meeting, rather than the quarter-point move the FOMC ultimately approved.
    They said they would continue to favor a more aggressive move at the March meeting. Markets have been volatile in the wake of those remarks as well as a batch of inflation data that came in higher than expected, stoking fears that the Fed has more work to do to bring down prices.
    But Bullard said the more aggressive move would be part a strategy that he thinks ultimately will be successful.
    “If inflation continues to come down, I think we’ll be fine,” he said. “Our risk now is inflation doesn’t come down and reaccelerates and then what do we do. We are going to have to react, and if inflation doesn’t start to come down, you know, you risk this replay of the 1970s where you had 15 years and you’re trying to battle the drag, and you don’t want to get into that. Let’s be sharp now, let’s get inflation under control in 2023.”

    Despite the tougher talk and hot inflation data, markets still largely expect the Fed to go with the quarter-point move next month, according to CME Group data.
    Futures trading indicates, however, that the benchmark short-term borrowing rate will top out at a “terminal” level of 5.36% this summer, higher than the 5.1% estimate committee members made in December but about in line with Bullard’s projection of a 5.375% rate.
    Investors fear that higher rates could tip the economy into recession. Major averages saw their biggest sell-off of the year Tuesday, erasing all the gains the Dow Jones Industrial Average had made in 2023.

    Stock chart icon

    Dow erased its 2023 gains Tuesday.

    But Bullard said he thinks “we have a good shot at beating inflation in 2023” without creating a recession.
    “You’ve got China coming on board. You’ve got a stronger Europe than we thought. It kind of seems like the U.S. economy might be more resilient than markets thought, let’s say six or eight weeks ago,” he said.
    Investors will get another look inside the Fed’s thinking later Wednesday when the FOMC releases the minutes from the Jan. 31-Feb. 1 meeting at 2 p.m. ET.

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