Raphael Stevens

Comcast said NBCUniversal’s Peacock will hit peak losses in 2023.
NBCUniversal’s earnings were weighed down by losses stemming from the streaming service.
Peacock was launched in 2020 and recently surpassed 20 million paying subscribers.

The NBCUniversal Inc. Peacock streaming service is displayed on a laptop computer in an arranged photograph taken in the Brooklyn Borough of New York, U.S., on Monday, April 20, 2020.
Gabby Jones | Bloomberg | Getty Images

Streaming service Peacock has slowly been taking flight with consumers. Its losses on Comcast’s balance sheet, however, have been swift.
Like its peers, Comcast has been investing in its streaming platform by putting more of its content on Peacock. But it’s coming at a heavy cost.

Peacock weighed down earnings for Comcast’s NBCUniversal, with the company reporting Thursday that Peacock recorded an adjusted loss of $978 million during the fourth quarter. For the overall year, Peacock’s losses were in line with what the company had earlier warned–about $2.5 billion.
The pain isn’t over yet. Company executives said Thursday Peacock losses will peak in 2023 at around $3 billion, but expect it to steadily improve after that.
Investors’ tune have changed about adding customers no matter the cost.
Mounting content costs and slowing subscriber additions caused Wall Street to question the viability of the streaming business model in the last year. When Netflix reported subscriber growth last week not only did its stock jump, but its competitors benefitted from it, too.
On Thursday, NBCUniversal CEO Jeff Shell said the company had “made clear from the start we’re going to make a return” on its investment in Peacock. He added, “I think we feel better about that now,” as the streamer announced subscriber growth.

Shell noted the goal for Peacock all along was to make a return. NBCUniversal echoed what other media leaders have said in recent months about reaching profitability in streaming, especially Warner Bros. Discovery’s David Zaslav as the company cuts back on costs, including on content.
Shell’s fellow executives said Thursday they were optimistic about the streaming service. Peacock added 5 million paying subscribers – its best quarter yet – and the platform now has more than 20 million customers.
NBCUniversal was one of the last to enter the streaming landscape with Peacock. As they slowly made their way into streaming, they launched Peacock with a cheaper, ad-supported option, something competitors have leaned into in the last year.
Still, consumers adding Peacock to their streaming lineup has just begun to pick up in the last year. That’s likely been due to its deep sports slate. Sunday Night Football games air simultaneously on the platform, as did 2022 World Cup matches and English Premier League games.
NBCUniversal movies on the platform have helped, too. The last installment of horror franchise “Halloween” debuted on Peacock and in theaters on the same day in October. The studio’s 2022 hit, “Nope,” was also a boost, among others, executives said.
The next day airing of programs from cable channel Bravo and broadcast network NBC has been a positive too, executives said Thursday.
Those next-day NBC programs also come at a cost, though. For years, NBC content would air next-day on Disney’s Hulu platform. NBCUniversal let that deal expire last year to strengthen Peacock instead.
And besides that, propping up Peacock with NBCUniversal content from its linear networks also only helps to accelerate its bleeding of Comcast’s cable-TV customers.
“We spend quite a bit of money creating content,” Comcast President Mike Cavanagh said Thursday. “So migrating some of that content as eyeballs move to a more streaming universe, we like what we’re doing and we had a phenomenal year getting paid subscribers to 20 million.”
Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC.

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“Skinamarink,” the debut film of Kyle Edward Ball, grossed $1.5 million at the box office in its first two weekends despite a production budget of just $15,000.
The experimental horror film went viral on social media after its first showing last year at Montreal’s Fantasia International Film Festival.
“Skinamarink” will premiere Feb. 2 on AMC Networks’ Shudder streaming service.

A still promo for the film Skinamarink.
Coutesy: Bayview Entertainment

Experimental horror film “Skinamarink” has been all the buzz on social media for months — and now it’s a sleeper hit at the box office.
“Skinamarink,” the first feature from Canadian director Kyle Edward Ball, has pulled in over $1.5 million at the box office in just over a week of release, according to Comscore.

Some film enthusiasts have compared the experimental movie, with its $15,000 budget, to found-footage horror classic “The Blair Witch Project” and David Lynch’s surrealistic 1977 midnight movie “Eraserhead.”
To be sure, “The Blair Witch Project,” which was a trendsetter for movies propelled by internet buzz, grossed $140 million in 1999 on a budget of less than $100,000, but the success of “Skinamarink” is helping define the current era of lucrative scare flicks.
According to data from Comscore, the horror genre generated about $700 million in domestic ticket sales in 2022, less than 10% of the $7.5 billion in total domestic box office sales. Much of these sales come from the most wide-released horror films that had budgets between $16 million and $35 million.
Shudder, a horror-focused streaming service owned and operated by AMC Networks, picked up exclusive rights to the film. The movie will premiere on the platform Feb. 2. “Skinamarink” currently has a “fresh” rating of 71% on review aggregation site Rotten Tomatoes.
“Skinamarink” centers on two children who discover their father has disappeared, along with all the doors and windows of the home. The film makes use of grainy, hard-to-decipher shots of walls, furniture, television screens and ceilings to depict the eeriness of the abandoned, liminal home. It doesn’t show the characters’ faces. Ball told Vulture he intended the film to feel “as if Satan directed a movie and got an AI to edit it. An AI would make weird choices, like, ‘Yeah, I’m just gonna hold on this hallway of nothing for a while.'”

Some observers in the indie film industry saw it as a potential hit early on. Co-executive producer Jonathan Barkan, head of acquisitions at Mutiny Pictures, found the “Skinamarink” trailer on Reddit in late 2021 and took a gamble it would outperform many of its competitors and resonate with viewers.
While horror is seen by some as being a tried and true film genre that will return a profit, Barkan said making money with scary movies isn’t that easy. Independent horror films are released every week, and it’s very difficult to stand out among these releases, he said.
“For being a genre that is already typically a lower-budget genre, you have filmmakers who need to be very creative,” Barkan said. “They need to think, how can we stretch our budget? How can we do something really creative and still get across what we’re trying to convey, which is a sense of fear?”

Going viral with $15,000

Ball previously created and released short films based on people’s childhood nightmares for his Bitesized Nightmares YouTube channel. The channel, with over 11,400 subscribers, has pulled in a few thousand views for three- to five-minute horror shorts, as well as for his half-hour film “Heck.”
Ball used his childhood home in Edmonton, Alberta, as the film’s setting and his childhood toys for props. Ball stretched the $15,000 across equipment, lighting and film-editing software, in addition to film festival costs and legal documentation. He called in favors for casting and equipment, as well, according to Barkan.
There is “really no way to skirt around a certain budget” in all genres, though Ball took some creative alternatives to high-cost filming conventions, according to Josh Doke, an executive producer of “Skinamarink” and creative director at BayView Entertainment, which acquired Mutiny Pictures.
“A lot of filmmakers who are making a film, either for the first time or with a really low budget, they are trying to emulate … a Hollywood style with people in front of the camera who are talking and acting, and they maybe don’t have access to the best actors or the best lighting or the best equipment,” Doke said. “It comes off not looking quite like how they had in their head.”

Still shot from the film “Skinamarink”.
Courtesy: Bayview Entertainment

Ball avoided some costs by not shooting characters head on and instead having them speak off-screen or showing only their backs or feet. “You don’t need George Clooney in front of the camera,” Doke said. Lighting in many shots came only from television sets or a night light.
After acquiring the film, Barkan worked to get it into the Fantasia International Film Festival in Montreal, where he previously served as a jury member. This was the “first domino” in propelling its success, he said.
“It’s a stretch to say that there’s anything new under the sun or really original in our industry, but this really does feel like it’s not only experimental horror but experiential horror,” Doke said. “I think that what it does for people is it puts you right in the middle of a nightmare that you can’t wake up from.”
The world premiere attracted 22 reviews from critics, and it caught the attention of Shudder. This notice led it to film festivals in Europe, one of which saw its entire slate of films leaked.
While the production team tried to keep a lid on the film after it was pirated and file takedowns on illegal sites, clips of the film went viral on TikTok. #Skinamarink now has over 27 million views on the platform.
The film was originally intended for theatrical release around Halloween 2023, but plans were thrown out the window as demand to see the film grew rapidly.
“[Shudder] adapted it to embrace what was happening because there was no way to stop it,” Barkan said. “Rather than try to fight it, they worked with it.”

Snowball effect

With internet buzz and illegal downloads surging around Thanksgiving, Doke said the film could not wait another 10 months to release. The movie opened Jan. 13 in North American theaters.
“Initially, we were talking about a fairly limited theatrical release through Shudder and IFC just because with a film of his size, you never know the interest, and getting a big theatrical release is always a challenge,” Doke said. “But the snowball just kept rolling down the hill.”

Still shot from the film “Skinamarink”.
Courtesy: Bayview Entertainment

Shudder and the film’s production team agreed to an all-rights deal, meaning Shudder had not only streaming rights but also exclusives on subscription video and pay-per-view video services. Next, IFC Midnight, also owned by AMC Networks, was brought in to do theatrical showings prior to its exclusive release on Shudder.
“Once we saw the incredible response online, we knew we had to bring this film to as many theaters as possible nationwide,” Arianna Bocco, president of IFC Films and IFC Midnight, said in a statement. “Kyle has made a film for a new generation and has proved yet again what horror films and its community are capable of even with the smallest of budgets.”
What was expected to be 10 to 20 screenings led to 692 theaters predominantly in urban areas. Its first weekend “Skinamarink” grossed nearly $900,000. Last weekend, the film reached over 800 theaters and brought gross box office sales to more than $1.5 million — over 100 times its budget.
“To make a film for $15,000 and then to release it and get this level of attention and this wide of a theatrical release, and to reach this level of box office returns, is an incredibly rare feat,” Doke said.
–CNBC’s Sarah Whitten contributed to this report.
Disclosure: NBCUniversal, CNBC’s parent company, owns Rotten Tomatoes.

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Walmart-owned Sam’s Club plans to open more than 30 new clubs in the U.S.
The warehouse club is expanding after seeing sharp gains in sales and membership during the Covid pandemic.
Inflation makes the club’s value packs, cheaper gas and private label offerings more relevant, CEO Kath McLay said.

Shoppers stock up on merchandise at a Sam’s Club store in Streamwood, Illinois. 
Scott Olson | Getty Images

Walmart-owned Sam’s Club on Thursday said it will open more than 30 new stores in the U.S., marking its most aggressive expansion in years.
The warehouse club’s next store is expected to open in Florida in 2024. Sam’s Club also plans to open five fulfillment and distribution centers this year, with the first of those opening in Georgia.

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CEO Kath McLay said the retailer wants to reach more customers, after sharp gains in sales and an all-time high in membership at its current clubs. It plans to build about 30 clubs over the next five years and likely more in the two years after, she said.
And, McLay added, as prices of goods and services remain high, she said Sam’s offering has become more relevant.
“During times like inflation, times when people have pressure on their household budget, it’s a time when Sam’s Club can really show up,” she said in a CNBC interview. “So I think the time is really right for us.”
For Sam’s Club, the expansion marks a return to store footprint growth. The club chain has about 600 stores in the U.S., including Puerto Rico. Yet it hasn’t opened a new club in years. It shuttered 63 clubs around the country in 2018, converting a small number of those clubs into e-commerce fulfillment centers.
Its last major expansion was in the 2010s, when it opened five to 10 clubs per year on average. Its most recent new club opened in 2017 in Hanover, Pennsylvania.

McLay said the new stores will open in high-growth suburban areas where Sam’s Club has few stores or no stores, but declined to specify the locations, citing competitive reasons. She declined to say how much the company’s build-out of the clubs and e-commerce facilities will cost.
It will also add more people to Sam’s Club’s workforce. Each club typically employs about 150 to 175 people, McLay said. At its fulfillment centers, like the one that is coming to Georgia, Sam’s Club typically employs as many as over 1,000 people and its distribution centers average around 120 workers.
Sam’s Club’s new stores will be about 160,000 square feet — larger than Sam’s Club’s typical footprint of about 140,000. They will include extra space for a sushi island, a full-service floral area and a larger waiting area for customers with a hearing or optical appointment.
New clubs will cater to habits that shoppers picked up during the Covid pandemic, too. There will be more dedicated space for online options, such as a canopy where drivers can retrieve orders by curbside pickup and larger coolers to help employees who prepare online orders for delivery.

A hot moment for warehouse clubs

Over the past three years, more customers have turned to warehouse clubs, including Sam’s Club rivals Costco and BJ’s Wholesale Club. In the early days of the pandemic, shoppers loaded up their pantries with value packs of toilet paper, food and more. Then, as gas prices rose last year, the clubs drew customers by offering a cheaper way to fill up the tank. And as inflation hit a four-decade high, that ratcheted up interest in buying the club’s private labels and bulk items as a way to stretch dollars.
That’s reflected in stock gains. Shares of Costco, for instance, have shot up by nearly 60% since the pandemic began.
Sam’s Club is joining its competitors BJ’s and Costco in also opening stores.
Sam’s Club has seen close to double-digit same-store sales gains for more than a year, excluding fuel costs. In the most recent quarter, which ended in late October, its same-store sales rose 10% or nearly 24% on a two-year basis. Its membership income increased 8%.

Private labels are also a big draw to warehouse clubs. Sam’s Club’s private brand, Member’s Mark, accounts for 30% of the store banner’s sales and more than a third in terms of units, McLay said.
For Walmart, Sam’s Club’s expansion plans mark another bullish move for Walmart at a time when some economists anticipate a recession and other retailers hunker down for a tougher year. On Tuesday, the retail giant said it will raise the minimum wage for Walmart store employees in early March as it competes for talent.
Jefferies retail analyst Corey Tarlowe said the club channel, in particular, tends to hold up well, even during an economic downturn.
“People don’t actually tend to cut their memberships, believe it or not because they have to buy food and they want to buy food at the cheapest possible price,” he said. “So they tend to keep their memberships and some people trade into the club channel.”
Along with its store expansion plan, Sam’s Club has stepped up efforts to compete with other grocers and clubs. It raised its membership fee in October, bringing it closer to Costco’s. It redesigned existing clubs to make them brighter and less cluttered. And it has added tech-enabled features to Scan & Go, a mobile app that allows customers to skip the cashier line, quickly check out at the gas pump and ship bulky items like TVs instead of carrying them home.
And in November, it knocked down the price of its hot dog-and-soda combo from $1.50 to $1.38 – to undercut rival Costco’s $1.50 combo.

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Smart Tax Planning

If you’re banking on a tax refund, be aware it may be smaller than last year’s payment, according to the IRS.
Typically, you can expect a federal refund if you’ve overpaid yearly taxes or have withheld more than what you owe.
Your 2022 refund may be smaller because there were less generous tax breaks after pandemic relief expired, experts say.

Bill Oxford | E+ | Getty Images

If you’re banking on a tax refund, it may be “somewhat lower” than last year’s payment, according to the IRS.
Typically, you can expect a federal refund if you’ve overpaid yearly taxes or withheld more than what you owe. One of the big reasons for smaller payments this year is expiring pandemic relief, which was delivered via tax breaks for 2021 returns, experts say.

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Meanwhile, many Americans are still struggling financially, with nearly one-third relying on their tax refund to make ends meet, a recent Credit Karma survey found.
Joe Buhrmann, a certified financial planner and senior financial planning consultant at eMoney Advisor, said smaller refunds and high inflation may be a “double whammy” for some families.
The average refund for the 2022 filing season was $3,176 as of Oct. 28, up nearly 14% from $2,791 in 2021, according to the IRS.

Why your 2022 tax refund may be smaller

There are several reasons why some filers may have a “nasty surprise” when filing their tax returns this year, Buhrmann said.
Thanks to the American Rescue Plan of 2021, many families got a boost from the enhanced child tax credit, worth up to $3,600 per child, and child and dependent care tax credit of up to $4,000 per dependent.

But those tax breaks have returned to previous levels. For 2022, the child tax credit dropped back to a maximum $2,000 per child, and the child and dependent care tax credit reverted to $1,050 per dependent. “That’s money out of refunds right there,” Buhrmann said.
If you didn’t receive the third stimulus payment, there was a chance to claim it on your 2021 return, further padding refunds, he said. 

Another pandemic-era change was a more generous charitable deduction in 2021, allowing filers to score a tax break, even if they didn’t itemize deductions.
The deduction — $300 for single filers or $600 for married couples filing jointly — was a “meaningful amount” for a lot of Americans, said Tony Molina, a certified public accountant at Wealthfront.

How to boost your refund or reduce your bill

While there aren’t many ways to increase your refund or trim your bill before the April 18 tax deadline, you may still have a few options, Molina said.
“One easy thing is you can still contribute to a traditional [individual retirement account]” and have it count for last year, he said, which may offer a tax deduction. Your eligibility for the tax break depends on your income and workplace retirement plan participation. 
There’s also still time for health savings account contributions for 2022, which also offers a deduction, assuming you have an eligible high-deductible health insurance plan. More

Chipotle Mexican Grill is seeking to hire 15,000 restaurant workers ahead of its busiest time of the year.
Restaurant workers are still in high demand, although the labor crunch has eased.
Chipotle’s Chief Restaurant Officer Scott Boatwright said in a statement that the company will keep hiring to support its “aggressive growth plans.”

A “Now Hiring” sign is displayed in front of a Chipotle restaurant on October 07, 2022 in Washington, DC.
Anna Moneymaker | Getty Images

Chipotle Mexican Grill is seeking to hire 15,000 restaurant workers ahead of its busiest time of the year, which runs from March to May.
In recent months, restaurants have found it easier to attract and retain workers, a reversal after the labor crunch that ensued after pandemic lockdowns. However, the sector has always had high turnover, and restaurants are still concerned about having enough employees to meet demand, even as some consumers pull back on going out to eat amid persistent inflation.

And while layoffs have hit white-collar workers, primarily in the tech industry, low-wage retail and restaurant workers haven’t faced any large-scale cuts. The unemployment rate for eating and drinking places was 5.2% in December, down from the pre-pandemic rate of 5.7%, according to Labor Department data.
Chipotle’s Chief Restaurant Officer Scott Boatwright said in a statement that the company will keep hiring to support its “aggressive growth plans.” Nearly a year ago, the chain revised its long-term outlook for unit growth. It’s now aiming to double its store footprint to 7,000 locations eventually, up from a prior target of 6,000.
Chipotle said that it’s working on improving and speeding up its hiring process. To attract and retain workers, the company offers benefits like free meals, tuition reimbursement, debt-free college degrees, access to mental health care and an all-crew bonus worth an extra month’s pay each year.
Chipotle has more than 100,000 employees currently. 
The burrito chain is expected to report its fourth-quarter earnings after the bell on Feb. 7.

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