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Last week, the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) increased to 6.43% from 6.30% the previous week.
Applications to refinance a home loan decreased 6% from the previous week and were 56% lower than the same week one year ago.

Homes in Centreville, Maryland, US, on Tuesday, April 4, 2023. 
Nathan Howard | Bloomberg | Getty Images

Today’s homebuyers appear to be increasingly sensitive to weekly moves in mortgage rates. While home prices are easing some, affordability is still a major hurdle, especially as more first-time buyers enter the market.
Last week, the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) increased to 6.43% from 6.30% the previous week, with points rising to 0.63 from 0.55 (including the origination fee) for loans with a 20% down payment.

As a result, mortgage applications to purchase a home dropped 10% from the week before, according to the Mortgage Bankers Association’s seasonally adjusted index. Buyer demand was 36% lower than the same week one year ago when the 30-year fixed-rate mortgage averaged 5.20%.
“Affordability challenges persist and there is limited for-sale inventory in many markets across the country, so buyers remain selective on when they act,” wrote Joel Kan, MBA’s deputy chief economist, in a release. “The 10-percent drop in FHA purchase applications, and the increase in the average purchase loan size to its highest level in a month, are other indications that first-time buyers have pulled back.”
But wealthier buyers may also be seeing new difficulties when it comes to credit. Banks had been offering better rates on jumbo loans, but that spread between jumbo and conforming loans is much tighter now, compared with last year. This has to do with recent regional bank failures that have rippled through the industry.
“As banks reduce their willingness to hold jumbo loans, we expect this narrowing trend to continue,” Kan said.
Applications to refinance a home loan decreased 6% from the previous week and were 56% lower than a year ago. The refinance share of mortgage activity increased to 27.6% of total applications from 27.0% the previous week.
Mortgage rates moved significantly higher to start this week, according to another rate survey from Mortgage News Daily. Still, rates have been bouncing between 6% and 7% for several months. Potential homebuyers may be getting used to seeing higher rates now, but home prices haven’t corrected enough yet to bring affordability back to earth. More

International Covid vaccine sales helped spark Johnson & Johnson’s revenue and earnings beat, but the consumer staples giant said it expects no sales from the shot moving forward. 
J&J’s unpopular shot appeared to bear its last fruit Tuesday, contributing $747 million in sales during the three-month period ended March 23.
All Covid vaccine revenue during the first quarter came from outside of the U.S. It is unclear which countries contributed to the sales.

The Janssen Johnson & Johnson COVID-19 vaccine.
Allen J. Schaben | Los Angeles Times | Getty Images

International Covid vaccine sales helped spark Johnson & Johnson’s revenue and earnings beat on Tuesday, but the company said it expects no sales from the shot moving forward. 
“Regarding our Covid-19 vaccine, we do not anticipate material sales beyond that which were recorded in the first quarter as our contractual commitments are complete,” Joseph Wolk, the chief financial officer, said during a conference call Tuesday.

Those commitments include external manufacturing exit costs and clinical-trial expenses, the consumer staples giant said in its first-quarter earnings release.
That marks the end of a rocky three years for J&J’s Covid vaccine despite being one of the first shots to enter the U.S. market during the pandemic. The vaccine, initially billed as a single-dose regimen, has long been overshadowed by the slightly more effective shots from Pfizer and Moderna due to a rare but serious risk of a blood-clotting disorder.
J&J’s unpopular shot appeared to bear its last fruit Tuesday, contributing $747 million in sales during the three-month period ended March 23. That drove strong growth in the company’s pharmaceutical business, which saw sales grow more than 4% over the same period last year.  
Notably, all Covid vaccine revenue during the quarter came from outside of the U.S. It is unclear which countries contributed to the sales.
That revenue number trounced estimates of Wall Street analysts. 

Bank of America analyst Geoff Meacham had expected the shot to bring in $150 million in sales during the quarter. A forecast by Wells Fargo analysts did “not assume any Covid sales in Q1,” but noted that some revenue from contract commitments could “pull through.”
After J&J reported earnings, SVB Securities analyst David Risinger also noted that sales of the vaccine beat a consensus estimate by more than $500 million. JP Morgan analyst Chris Schott added that J&J’s first-quarter beat was in part “driven by Covid vaccine upside.”
First-quarter sales of the Covid vaccine are also up from the $544 million it raked in during J&J’s last quarter, and the $457 million the company reported a year ago. 
The last time J&J reported U.S. sales of the vaccine was during the second quarter of 2022, which ended weeks after a Food and Drug Administration decision that strictly limited who can receive the shot. The agency said the vaccine can only be given to adults who specifically request it or cannot receive a different shot, pointing to the risk of blood clots. 
Earlier this year, the drugmaker also announced it scaled back production of the shot amid slumping demand.
While J&J’s vaccine fell out of favor in the U.S. and other wealthy countries, developing countries have continued to rely on it. As a single shot, the vaccine is less expensive and easier to distribute to hard-to-reach populations. More

Lululemon is looking to sell its at-home fitness business Mirror and has approached competitor Hydrow as a potential buyer, industry sources told CNBC.
The athletic apparel retailer acquired the connected fitness company for $500 million at the height of the at-home fitness craze in 2020 but the segment has been weighing on its balance sheet.
It’s not clear whether Hydrow, which makes connected rowing machines, is interested in moving forward with a deal.

A Lululemon sign is seen at a shopping mall in San Diego, California, November, 23, 2022.
Mike Blake | Reuters

Lululemon is looking to sell its at-home fitness business Mirror and has approached competitor Hydrow as a potential buyer, CNBC has learned. 
Multiple parties have reached out to Hydrow to gauge its interest in Mirror, said industry sources, who declined to be named because the talks are private. 

It’s not clear whether Hydrow, a private startup that sells connected rowing machines, is interested in moving forward with a deal. The company said it doesn’t comment on rumors or speculation.
A Lululemon company spokesperson said the same.
“As previously announced, we are shifting the focus of lululemon Studio from a hardware-centric offering to one that is also focused on digital app-based services going forward,” the spokesperson said. “This work is underway, and our strategy will enable us to create long-term value and build a larger community of guests with a deeper connection to lululemon.”
Lululemon announced it would acquire Mirror for $500 million at the height of the at-home fitness bonanza in June 2020. It was a bet that people would continue to exercise at home, even after the Covid pandemic ended and gyms reopened. 
At the time of the acquisition, the fitness startup offered live weekly classes that users could follow along with using its wall-mounted mirror device. It also offered on-demand workouts and one-on-one personal training sessions. 

The segment has since rebranded as lululemon Studio but has been weighing on the fitness apparel company’s balance sheet. 
During the three months ended Jan. 29, the company said it took $443 million in impairment charges related to Mirror and told investors hardware sales have come in below expectations. Shares of Lululemon are up about 16% so far this year.
The Mirror product, which once retailed for $1,495, is now sold for as low as $995 and requires a $39 monthly subscription charge. 
Lululemon acknowledged the at-home fitness market has been under pressure. Similar to Peloton, it has begun pivoting the segment away from being hardware-focused. 
In March, Lululemon announced it will launch a new digital fitness app in the summer that will allow consumers to access digital fitness content without hardware and at a lower price point than its current subscription package.
“Since our acquisition, the at-home fitness space has been challenging. While members love our content, hardware sales did not match our expectations. … As we continue to invest prudently in this business, we are evolving the model from being focused on hardware-only to offering content through a digital and app-based solution as well,” Lululemon CEO Calvin McDonald told investors on an earnings call. 
“We view lululemon Studio in the same way we view any innovation. We test, we learn, and we evolve as necessary. Although the acquisition is not fully materialized as originally intended, we are in a much better position in our understanding of community and our new membership program as a result.” 
Bloomberg News initially reported that Lululemon was exploring a sale of Mirror. More

Netflix delayed the broad rollout of its password-sharing crackdown, which was originally planned for the first quarter.
The streaming giant’s earnings topped Wall Street’s estimates, while revenue came in slightly below them.

Reed Hastings, co-CEO of Netflix, participates in the Milken Institute Global Conference on October 18, 2021 in Beverly Hills, California.
Patrick T. Fallon | AFP | Getty Images

Netflix on Tuesday posted mixed financial results and said it was pushing back its broad rollout of its password-sharing crackdown.
Originally, Netflix wanted the rollout to take place late in the first quarter, but on Tuesday it said it would do it in the second quarter.

“While this means that some of the expected membership growth and revenue benefit will fall in Q3 rather than Q2, we believe this will result in a better outcome from both our members and our business,” the company said in its earnings release.
The company said it saw its subscriber growth impacted in the international markets where it has already rolled out such initiatives.
Here are the results Netflix reported Tuesday versus estimates from analysts polled by Refinitiv:

Earnings per share: $2.88 vs $2.86 expected
Revenue: $8.16 billion vs $8.18 billion expected

For the quarter ended March 31, Netflix reported earnings of $1.31 billion, or $2.88 a share, compared with $1.6 billion, or $3.53 a share, a year earlier. Revenue grew to $8.16 billion from $7.87 billion in the prior-year period.
Shares of Netflix initially fell more than 10% but mostly recovered in after hours trading.

Netflix’s crackdown on password sharing has been top of mind for investors. Late last year, the company said it would begin rolling out measures to have people who have been borrowing other accounts create their own.
The company has said more than 100 million households share accounts, or about 43% of its global user base. That has affected its ability to invest in new content, Netflix has said. Both the ad-supported option and crackdown on password sharing are meant to boost profits.
“The launch in Q2 will be broad, including the U.S. and the bulk of our countries when we think about it from a revenue perspective,” said co-CEO Greg Peters on Tuesday’s earnings call. Peters likened the paid sharing transition to that of increasing prices – subscribers initially balk and cancel, then slowly return and sign up for their own accounts.
In February, Netflix outlined password-sharing guidance in four countries: New Zealand, Canada, Portugal and Spain. The company said it would ask users in those countries to set a “primary location” for their accounts, and allow users to establish up to two “sub accounts” for those who don’t live in their home base for extra fees.
Netflix said Tuesday it has been pleased with its push to mitigate password sharing. In Latin America, the company said it saw cancellations after the news was announced, which affected near-term growth. But, Netflix added, those password borrowers would later activate their own accounts ad add existing members as “extra member” accounts. As a result, the company said, it is seeing more revenue.
Canada, which will likely serve as a template for the U.S., has seen its membership base grow due to the launch of paid sharing, and revenue growth has accelerated and “is growing faster than in the U.S.”
The company said that as it rolls out its paid sharing initiatives, it expects near term engagement – which is measured by Nielsen for its ad-supported tier – to “likely shrink modestly.” Still, the company believes it will bounce back as its seen in international regions.

Expecting a revenue bump

Netflix said it believes paid sharing will ensure increased revenue in the future as it looks to improve its service. On Tuesday, Netflix said it expects to spend in the range of roughly $17 billion in 2024 on content.
Co-CEO Ted Sarandos said Tuesday the company hopes to avoid a writers’ strike and talks continue with the Writers Guild of America.
“We respect the writers and WGA and we couldn’t be here without them. We don’t want a strike,” Sarandos said Tuesday. Still, Sarandos noted that if a strike were to occur, Netflix has a robust slate of TV and movies coming up.
Netflix noted on Tuesday that “competition remains intense as we compete with so many forms of entertainment.”
On Tuesday, Netflix said goodbye to what got it started — its DVD mailing business, in which it would send out the discs in red envelopes to customers. The company’s CEO Ted Sarandos said in a blog post that it would finally wind down the DVD business, which “continues to shrink.”
A year ago, Netflix had reported its first subscriber loss in a decade, sending its shares on a downward spiral, as well as those of its media peers. The results pushed Netflix and its streaming rivals to focus on profits over subscriber numbers.
As Netflix looked to boost its profits and subscriber base, it turned its focus to an ad-supported plan, as well as the password sharing crackdown.
Last November, Netflix unveiled its cheaper tier with commercials, which costs $6.99 a month. The ad-supported tier came shortly after it lost subscribers as streaming competition ramped up.
Sarandos recently said the company is likely to offer multiple ad-supported tiers in the future.
Netflix’s ad-supported plan now has an average of 95% of the same content as what is on its commercial-free plans due to recent licensing deals, the company said Tuesday.
“We are pleased with the current performance and trajectory of our per-member advertising economics,” Netflix said Tuesday.
Peters added Tuesday Netflix wasn’t prepared to announce or forecast expectations regarding its ad-supported plan. 
In some markets, Netflix has seen users move between tiers after paid sharing was introduced, Peters said, although it was very “country-specific.”
The executives also addressed the glitch that left millions unable to watch the live airing of “Love is Blind” on Sunday.
Peters and Sarandos both said the company was “really sorry to have disappointed so many people.”
Peters added that from a technical perspective Netflix has the infrastructure to pull off a live airing, as it did with the Chris Rock comedy special in March. But that “a bug was introduced” when trying to improve the Chris Rock special. “We hate it when these things happen but we will learn from it,” Peters said. More

Netflix blamed a technical bug for why it needed to delay its “Love Is Blind” reunion special.
The streaming company said the bug was introduced after the company aired Chris Rock’s comedy special live last month.
About 6.5 million people ultimately watched the “Love Is Blind” reunion special, said Netflix co-CEO Greg Peters.

A participant stands behind a door, hiding her identity, on Netflix’s “Love is Blind” reality dating show.
Source: Netflix

Netflix Co-Chief Executive Officer Greg Peters blamed a technical “bug” for why the company had to delay its “Love Is Blind” reunion special.
The reality TV special, originally set to run live at 8 p.m. ET Sunday night, eventually showed up on Netflix as a taped special on Monday.

“We’re really sorry to have disappointed so many people,” Peters said during the company’s first-quarter earnings conference call Tuesday. “We didn’t meet the standard that we expect from ourselves to serve our members.”
Peters explained Netflix had accidentally introduced a bug in an attempt to improve live broadcasting after airing a Chris Rock comedy special, “Selective Outrage,” last month. Netflix didn’t notice the technical error in internal testing because the bug only showed itself under the strain of millions of simultaneous livestreams from its subscribers, he said.
“From a technical perspective, we’ve got the infrastructure,” Peters said. “We hate it when these things, but we’ll learn from it and we’ll get better. We do have the fundamental infrastructure that we need.”
About 6.5 million viewers ultimately watched the “Love Is Blind” special on Netflix, Peters added.
Netflix co-CEO Ted Sarandos said there will be more live specials for popular reality TV.

“A reunion show that’s going to generate news and buzz, it really does play better live,” Sarandos said. “We’re super disappointed to not be able to come across with the live product for everyone who wanted it on the ‘Love is Blind’ reunion, but we’re super thrilled people love the show. Some of those results oriented shows do play a little better live.”
WATCH: Breaking down Netflix earnings More

Netflix cut its content spending by more than $1 billion during the first quarter, compared with the same period a year earlier.
The streaming is generating more cash as subscriber growth slows by cutting content costs.
The development comes after Hollywood writers voted to authorize a strike as they seek more pay.

Netflix gift cards are seen in a shop in Krakow, Poland on June 13, 2022.
Jakub Porzycki | Nurphoto | Getty Images

There’s overwhelming support among Hollywood writers to strike for more money. But their timing is far from ideal.
Netflix revealed Tuesday it spent $2.5 billion on content in the first quarter. That’s down from $3.6 billion in the first quarter a year earlier, according to its earnings report.

Like other media companies, Netflix appears focused on boosting free cash flow rather than cranking up spending to add more subscribers. Netflix’s total subscriber count in the U.S. and Canada barely budged in the first quarter. The company gained just 100,000 subscribers. Netflix ended the quarter with 74.4 million subscribers in the U.S. and Canada — about 200,000 subscribers less than it had a year ago.
Netflix added 1.75 million subscribers globally, a far cry from the 10 million-plus subscribers it used to add in quarters during the pandemic. Even still, Netflix raised its full-year free cash flow estimate to $3.5 billion from $3 billion.
The company is generating more cash as subscriber growth slows by cutting content costs. Netflix promised overall content spend in 2024 would be $17 billion — about the same as it’s been in 2022 and is expected to be in 2023.
But if that amount is cut, Netflix’s new investor story of boosting free cash flow may not be derailed.
That’s bad news for writers who want to get paid more. The incentive for big studios to capitulate on pay may not be the same as it was during the pandemic, when media companies were still increasing content spend in an arms race to gain subscribers. LightShed media analyst Rich Greenfield noted that when production shutdowns happened during the pandemic, Netflix’s free cash flow soared then, too.

“Multi-billion dollar operating losses could come in significantly better than expected with free cash flow also ending up being far greater than expected — remember how Netflix free cash flow came in far better than expected during the pandemic,” Greenfield wrote in a note to clients. “While there is certainly the potential that less “fresh” content in the back half of 2023 or lower quality content due to a lack of script edits will hurt streamers, we believe that impact is dwarfed by the cost savings from a production halt.”
The company nonetheless hopes to avoid a writers’ strike, co-CEO Ted Sarandos said during Netflix’s earnings video presentation Tuesday.
“We respect the writers and WGA and we couldn’t be here without them. We don’t want a strike,” Sarandos said. Still, if a strike did happen, Netflix has a robust slate of TV series and movies ahead, he added.
A writers’ strike could put more emphasis on Netflix adding live programming — something the company is clearly still struggling with.
Still, Netflix seems prepared to weather a writers’ strike — because it’s already getting permission from investors to cut content spend without one.
Netflix shares are up about 13% so far this year as of Tuesday’s close. They were down slightly during after hours trading.
–CNBC’s Lillian Rizzo contributed to this report. More

Fox Corp. and its cable networks agreed to pay $787.5 million to Dominion Voting Systems to settle a defamation lawsuit over false claims that Dominion’s machines swayed the outcome of the 2020 presidential election.
The settlement, which came after a jury had been seated, averted a weekslong trial that could have seen top Fox TV hosts and network boss Rupert Murdoch publicly testify.
Dominion CEO John Poulos told reporters outside court that, as part of the settlement, “Fox has admitted to telling lies.”

WILMINGTON, Del. — Fox Corp. and its cable networks agreed Tuesday to pay $787.5 million to Dominion Voting Systems to settle a defamation lawsuit over false claims that Dominion’s machines swayed the outcome of the 2020 presidential election.
The settlement, which came after a 12-member jury had been seated in the case in Delaware Superior Court, averted a weekslong trial that could have seen top Fox TV hosts and network boss Rupert Murdoch publicly testify.

The deal, which will cost Fox nearly half of the $1.6 billion that Dominion originally demanded, was struck as opening arguments were delayed for hours amid speculation that the parties were discussing a resolution of the case.

Dominion CEO John Poulos, joined by members of the Dominion Voting Systems legal team, speaks to members of the media outside the Leonard Williams Justice Center in Wilmington, Delaware, on April 18, 2023.
Andrew Caballero-Reynolds | AFP | Getty Images

Dominion CEO John Poulos told reporters outside court that the settlement was “historic.”
“Fox has admitted to telling lies about Dominion that caused enormous damage to my company, our employees and the customers that we serve,” Poulus said.
“Nothing can ever make up for that. Throughout this process we have sought accountability and believed the evidence brought to light through this case underscored the consequences of spreading lies. Truthful reporting in the media is essential to our democracy,” he said.
Superior Court Judge Eric Davis called the jury and 12 alternate jurors into the courtroom shortly before 4 p.m. ET to announce that they would not have to hear any testimony or review any evidence.

“The parties have resolved this case,” Davis told them.
“Without you, the parties would not have been able to resolve their situation … although it’s short, not the six weeks you’ve expected, you have done your duty,” the judge said.

Justin Nelson (2R), joined by fellow members of the Dominion Voting Systems legal team, depart the Leonard Williams Justice Center in Wilmington, Delaware, on April 18, 2023.
Andrew Caballero-Reynolds | AFP | Getty Images

In a statement, Fox News Media said, “We are pleased to have reached a settlement of our dispute with Dominion Voting Systems.”
“We acknowledge the Court’s rulings finding certain claims about Dominion to be false,” Fox News Media said. “This settlement reflects Fox’s continued commitment to the highest journalistic standards. We are hopeful that our decision to resolve this dispute with Dominion amicably, instead of the acrimony of a divisive trial, allows the country to move forward from these issues.”
Fox’s on-air talent won’t have to acknowledge or say anything regarding the settlement on air, according to people familiar with the matter.
A Dominion spokesperson said Tuesday: “An apology is about accountability, and today Dominion held Fox accountable. Fox paid a historic settlement and issued a statement acknowledging that the statements about Dominion were false.”
The suit by Dominion, which sells voting machines and election software, had argued that Fox News and its sister network Fox Business “intentionally and falsely” blamed Dominion for the 2020 loss of former President Donald Trump to President Joe Biden by airing unsubstantiated claims about the company.
Fox had said in court filings that its hosts’ statements about Dominion were protected by the First Amendment. The company also said Dominion had not shown that the statements were made with so-called actual malice, which is the threshold for civil defamation claims.
Lawyers for Fox said nothing when asked for comment as they left court Tuesday.
The settlement avoids, for the moment, the risk of Murdoch and Fox hosts facing hostile questioning in public over the claims made about Dominion on the conservative news networks after the 2020 election.
The planned witnesses in the case had included Tucker Carlson, Maria Bartiromo, Sean Hannity, Laura Ingraham and Jeanine Pirro.
Also slated to testify was Lou Dobbs, whose Fox Business show was canceled in 2021.

Fox lawyers depart after Dominion Voting Systems and Fox settled the defamation lawsuit over Fox’s coverage of debunked election-rigging claims, in Wilmington, Delaware, April 18, 2023.
Mark Makela | Reuters

Fox faces a similar defamation lawsuit by another voting machine company, Smartmatic, over the company’s work during the 2020 election.
Smartmatic’s attorney J. Erik Connolly, in a statement, said, “Dominion’s litigation exposed some of the misconduct and damage caused by Fox’s disinformation campaign.”
“Smartmatic will expose the rest,” Connolly said. “Smartmatic remains committed to clearing its name, recouping the significant damage done to the company, and holding Fox accountable for undermining democracy.”
Dominion also has pending defamation lawsuits related to false claims about the 2020 election against Newsmax Media, One America News Network, Overstock founder Patrick Byrne, My Pillow CEO Mike Lindell, former Trump lawyer Rudy Giuliani, attorney Sidney Powell and others.
Stephen Shackelford, a lawyer for Dominion, said outside the court Tuesday, “Money is accountability. And we got that today from Fox.”
“But we’re not done yet. We’ve got some other people who have some accountability coming toward them,” Shackelford said.
He did not respond when CNBC asked if he expected settlements in other defamation cases Dominion has filed.
Correction: This story has been revised to clarify that Dominion CEO John Poulos told reporters outside court that, as part of the settlement, “Fox has admitted to telling lies.” It has also been revised to indicate that Maria Bartiromo was among the planned witnesses in the case. A previous version misspelled her name. More

Southwest Airlines briefly paused its departures on Tuesday after reporting technical problems.
More than 1,800 flights, or 44% of Southwest’s schedule, were delayed, according to flight-tracking site FlightAware.
Southwest had a meltdown over the year-end holidays, which drove thousands of flight cancellations and resulted in an $800 million pretax hit for the fourth quarter.

Passengers check in for Southwest Airlines flights at Chicago Midway International Airport on April 18, 2023 in Chicago, Illinois.
Scott Olson | Getty Images

Southwest Airlines briefly paused its departures on Tuesday after reporting technical problems, delaying half of its planned flights.
The Federal Aviation Administration said the ground stop had been lifted, but more than 2,100 flights were delayed as of 4 p.m. ET, according to flight-tracking site FlightAware. The delays accounted for more than half of U.S. flights on Tuesday.

“Early this morning, a vendor-supplied firewall went down and connection to some operational data was unexpectedly lost,” Southwest said in a statement. “Southwest Teams worked quickly to minimize flight disruptions.”
Southwest shares fell 0.8% on Tuesday, while the broader market and other large airline stocks rose.
Airlines or the FAA will occasionally pause departures, particularly at certain airports, to avoid bottlenecks for parking on the ground.
Southwest had a meltdown over the year-end holidays, which drove thousands of flight cancellations and resulted in an $800 million pretax hit for the fourth quarter. The airline upgraded scheduling software that couldn’t handle numerous changes to crew assignments during severe winter weather late last year.
The issues Tuesday did not appear to be related to that software.

The previous meltdown increased scrutiny on the airline’s technology from Washington.
“This is another demonstration that Southwest Airlines needs to upgrade their systems and stop the negative impacts to individual travelers,” said Sen. Maria Cantwell, D-Wash., chair of the Senate Commerce Committee, in a statement Tuesday.
Southwest is scheduled to report first-quarter results on April 27 before the market opens. More