The move comes a week after the company announced it was lowering its profit forecast as inflation was catching up with consumer spending.
Follow our latest coverage of business, markets and economy.
Sheera Frenkel and
Walmart is laying off 200 corporate workers, a person briefed on the matter confirmed on Wednesday, one week after the company slashed its profit outlook saying inflation was pressuring customers to make fewer purchases.
In a statement, Anne Hatfield, a company spokeswoman, said Walmart was “updating our structure and evolving select roles to provide clarity and better position the company for a strong future.” She added that the company was investing in other areas, including e-commerce and technology.
The corporate layoffs were first reported by The Wall Street Journal.
Walmart is the largest employer in the country, with nearly 1.6 million workers in the United States. The company spooked investors on July 25 when it cut its outlook for quarterly and full-year profit guidance.
In that announcement, Walmart said American consumers were pulling back on purchases of general merchandise to focus on necessities like groceries. The company said it expected operating profits for the full year to fall by as much as 13 percent, as the company was forced to continue marking down inventory that wasn’t selling.
The group of oil producers known as OPEC Plus approved a small increase in production on Wednesday, just over two weeks after President Biden visited Crown Prince Mohammed bin Salman of Saudi Arabia to seek assurances that the group would act to cool oil markets.
The Organization of the Petroleum Exporting Countries and its allies said they would increase production 100,000 barrels a day in September, far less than the nearly 650,000 barrels a day that the group agreed to add in July and August. OPEC Plus has now raised output to roughly prepandemic levels, but global oil supply is still low, and high energy prices have contributed to skyrocketing inflation around the world.
Politically, the paltry increase in output — less than one-tenth of 1 percent of global oil demand, the smallest boost in memory — would appear to be a snub of Mr. Biden, who went to Saudi Arabia seeking added production from major oil producers in the Middle East in order to ease gasoline prices. Raad Alkadiri, Eurasia Group’s managing director for energy and climate, said the increase was so small that it was effectively meaningless.
“It is a rounding error at best,” he said, akin to Saudi Arabia’s brushing off the White House by saying: “There you go — we’ve given you 100,000 barrels a day. Now get off our backs.” He said the move would not ease prices, nor was it a signal of any immediate intent to deliver more barrels to global markets.
Saudi Arabia’s decision not to increase production further was based on its own political and national security interests, not on Washington’s, Mr. Alkadiri said. Saudi Arabia’s ability to increase output significantly is limited, he added, and “for the Saudis to be able to play their role as the central bank of oil, they need to make sure they have significant volumes they can bring on in case of an emergency.”
U.S. officials have said they expect OPEC Plus, which has Russia as a co-chair, to lift output in the coming months. Ed Morse, the global head of commodities research at Citigroup, said Mr. Biden had probably gone into the meeting with the crown prince understanding that Saudi Arabia, the de facto leader of OPEC, would not agree to any significant increase in production.
The White House played down the importance of the meager increase, pointing to the larger production boost approved over the summer before the visit and noting that gas prices have been coming down already. Either way, Mr. Biden’s aides said, there were significant issues that justified the president’s trip to Saudi Arabia beyond energy.
“It was important to go,” said Karine Jean-Pierre, the White House press secretary, pointing as an example to a cease-fire in the long-running war in Yemen that was just extended with Saudi support. “We’re saving thousands of lives, so that matters as well. So we think that the trip was certainly worth it.”
Oil prices rose immediately after the announcement but later traded down by more than 3 percent. Oil prices have fallen from recent peaks but remain high, buoyed by sanctions on the Russian economy because of its invasion of Ukraine. Brent crude, the international benchmark, was about $97 a barrel, and West Texas Intermediate, the U.S. benchmark, was around $90. A year ago, oil was trading at between $60 and $70 a barrel.
Analysts said concerns about weaker demand for energy, as economic growth slowed and central banks raised interest rates to fight inflation, also might have discouraged the cartel from raising production significantly.
Damien Courvalin, the head of energy research at Goldman Sachs, said the decision was a reflection of the significant uncertainty about the state of the oil market, including the risk of a recession and lower demand from China.
“Is that an environment where you’d want to do a lot more?” he said. “From their perspective, it’s a justifiable, cautious approach.” He also cited risks of falling production from Russia, Libya and Iraq.
The move also reflected constraints on the group’s ability to deliver more production, analysts said. Many of its 23 members are already missing production targets because of a lack of investment in production capacity. OPEC Plus said in a statement that availability of spare capacity was “severely limited” because of chronic underinvestment in the oil sector.
It’s still unclear what effect Western sanctions will have on Russia’s oil production, said Caroline Bain, the chief commodities economist at Capital Economics. Output could fall significantly over the next year, not just as Russia struggles to find buyers for its crude but also because of the lack of access to Western technology, spare parts or financing in some cases.
But increased output from OPEC and its allies over the coming months, combined with lower demand because of a looming recession in Europe and a slowdown in the United States, would help drive prices lower, Ms. Bain said.
“We’ve not only got lower growth on the horizon, but we’ve also got high inflation, which is going to eat into disposable incomes and give people less money to spend on discretionary goods and travel,” she said. “If you’re a family of four, you maybe won’t go for a drive to the seaside because it’s going to cost so much.”
Peter Baker contributed reporting.
Standing before a hulking metal turbine that normally propels natural gas from Russia to Germany through the Nord Stream 1 pipeline, Chancellor Olaf Scholz of Germany rejected Russia’s contention that technical problems were behind the sharp curtailment in gas flows to Germany.
He said the only reason the machine had not yet been returned to Russia after undergoing maintenance work was that Gazprom, Russia’s state energy giant, did not want it back.
The turbine, which is at the heart of a dispute between Germany and Gazprom, was on display Wednesday at a news event in the western German city of Mülheim an der Ruhr, where its has been stored since it was returned from refurbishment in Canada.
Gazprom and Vladimir V. Putin, Russia’s president, have blamed Siemens Energy, the turbine’s manufacturer, for delays in returning it to Russia. They have repeatedly cited the need for “required documents and clarifications,” and said the turbine’s absence was the reason it had slashed gas flows to 20 percent of capacity.
Gazprom issued a statement later on Wednesday saying the sanctions enacted by Canada, Germany and Britain prevented it from taking the turbine back. But Mr. Scholz had said earlier that nothing was standing in the way of its return.
After weeks of releasing only terse responses, the German side seemed intent on calling the bluff of Gazprom and Mr. Putin.
“It is obvious that nothing, nothing at all, stands in the way of the further transport of this turbine and its installation in Russia. It can be transported and used at any time,” Mr. Scholz told reporters. “There is no technical reason whatsoever for the reduction of gas supplies.”
European officials say Russia is cutting back its gas deliveries to punish Europe for its opposition to the war in Ukraine. In mid-June, Gazprom cut back the amount of gas it was delivering to Germany through the Nord Stream 1 pipeline to only 40 percent of possible capacity. Last week, it reduced the amount again by half.
Daily flow of natural gas via Nord Stream 1 pipeline
Source: Nord Stream
By The New York Times
Germany still relies on Russia to meet about a third of its natural gas needs, down from more than half before the start of the war but still enough to leave the country reeling from the cuts. It is scrambling to store up enough of the fuel before demand rises in winter, in hopes of staving off rationing and shutdowns of key industries if Russia cut off supplies entirely.
Gas storage facilities in Germany were 69 percent full on Wednesday, but officials told companies and citizens to begin reducing their energy usage as much as possible while the weather was still warm. Nearly half of all homes in Germany are heated with gas, and households, along with essential infrastructure such as hospitals and rescue services, will be given priority in the event of shortages.
Mr. Putin has suggested that Germany could solve its gas problem by opening the second pipeline that was mothballed days before Russia invaded Ukraine, Nord Stream 2.
That proposal was echoed by Gerhard Schröder, the former German chancellor, who remains close to Mr. Putin despite being outcast by his own political party, the Social Democrats, and many Germans. In an interview with the German newsweekly Stern, Mr. Schröder, who met with the Russian president in Moscow last week, also said the Kremlin was open to talks to end the war, on condition that Ukraine surrender its claim to Crimea — which Russia annexed in 2014 — as well as its aspirations to join NATO.
Asked about the prospect of restarting Nord Stream 2, Mr. Scholz stifled a laugh, pointing out that its twin pipeline running under the Baltic Sea, Nord Stream 1, was already being underused, as were other overland links through Ukraine, as well as one through Belarus and Poland — that Russia had put under sanctions.
“There’s enough capacity with Nord Stream 1,” he said. “All the contracts that Russia has concluded for the whole of Europe can be fulfilled with the help of this pipeline.”
The reduced flows of natural gas have caused prices in Europe to jump to record highs. On Wednesday they remained about double what they were in mid-June, when Russia began restricting flows through the Nord Stream 1 pipeline.
Christian Bruch, the head of Siemens Energy, who appeared with Mr. Scholz, said that his company was in regular talks with Gazprom over the issue of the turbine and that it was eager to return it so other Siemens turbines used in the pipeline could also be taken for maintenance.
But the Russian company has a “different view” of the situation, he said, without elaborating.
“This turbine is ready to go immediately,” Mr. Scholz said. “If Russia does not take up this turbine now, it shows the whole world that not taking it is just an excuse to reduce gas supplies to Germany.”
The New York Times Company added about 180,000 net digital-only subscribers in the second quarter of the year but generated less digital advertising revenue, it said on Wednesday.
The Times now has 9.17 million paid subscribers. It has a goal of 15 million by the end of 2027.
The company reported $76 million in adjusted operating profit, 18 percent less than the same quarter last year. It generated total revenue of $555.7 million, an 11.5 percent increase from a year earlier. Digital subscriptions accounted for $238.7 million of that revenue, a 25.5 percent increase.
The hit to operating profit was mostly from losses at The Athletic, the sports news website that The Times bought in February for $550 million. Adjusted operating losses at The Athletic were $12.6 million for this quarter, from April to June, down from about $19.4 million in the first quarter.
The Times reported 9.107 million subscribers at the end of the first quarter of 2022. That number was revised in this quarter’s results down to 9.01 million.
A key part of The Times’s strategy is making a distinction between subscribers and subscriptions. One subscriber may have a subscription to more than one of the company’s products, which include The Athletic, Cooking and Wirecutter. The Times is betting on bundling digital offerings with its news report to reach new audiences with a variety of interests.
“News remains core to our value proposition, but the bundle helps ensure that The Times is indispensable to an ever-widening group of people, even as news engagement ebbs and flows,” Meredith Kopit Levien, the president and chief executive of the Times Company, said on a call with analysts.
In the second quarter, the company had its highest-ever number of new subscribers to the All Digital Access tier, which includes The Times’s news report, Games, Cooking, Wirecutter and The Athletic, Ms. Levien said.
The net gain of 180,000 digital-only subscribers was a 70 percent increase from the net gain in the second quarter of 2021. The company added far more in the first quarter of the year, 418,000. The Athletic added a net increase of 50,000 stand-alone subscribers in the most recent quarter.
The vast majority of The Times’s subscribers pay for digital-only access. The number of print subscribers continued to shrink in the second quarter, down nearly 7 percent from a year earlier, to about 761,000.
Digital advertising revenue for the Times Company in the quarter decreased 2.4 percent from a year earlier, to $69.3 million, as marketers reduced their spending in the face of economic uncertainty. Print advertising rebounded 15.1 percent, to $48.1 million, from the same quarter last year, as the entertainment and luxury categories started to recover from the pandemic.
Total operating costs increased 19.6 percent to $504 million. The company also noted a $34.2 million gain from the sale of land at The Times’s printing facility in College Point, Queens.
The company said it expected digital subscription revenue in the third quarter to grow 21 to 25 percent from a year ago. It said it expected a flat or small decrease in total advertising revenue and an increase of 9 to 13 percent in adjusted operating costs in that period.
The company’s shares were down 1 percent at the close of trading on Wednesday.
Lucid Motors, a maker of widely praised electric cars that the company has struggled to mass-produce, cut its production target for the year by almost half on Wednesday after delivering just 679 vehicles in the second quarter.
The California company, which hopes to challenge Tesla in the luxury car market, had told investors this year that it would deliver 12,000 vehicles in 2022. The new target is 6,000 to 7,000. Even that more modest goal requires Lucid to deliver at least five times as many cars in the second half of the year as it did in the first half.
Peter Rawlinson, Lucid’s chief executive, blamed “the extraordinary supply chain and logistics challenges we encountered” for the shortfall. Demand for vehicles remains strong, he said
“Although frustrating,” Mr. Rawlinson said during a conference call with investors, “this is a phase of our company’s growth that we will power through.”
The 679 deliveries in the second quarter compared with just 360 vehicles in the first. Lucid said in May that it was having problems acquiring components. All automakers have suffered supply chain problems, but shortages of parts and raw materials have come at an especially bad time for Lucid and other fledgling carmakers like Rivian. Manufacturing vehicles is difficult enough for a new company without having to fight for a share of scarce commodities.
After its debut model, the Lucid Air, was named Motor Trend’s Car of the Year for 2022, the company was seen as a serious threat to Tesla because of the sedan’s range of more than 500 miles on a charge and its attractive styling. Lucid’s headquarters in Newark, Calif., are a short drive from Tesla’s factory in Fremont, and Mr. Rawlinson is a former Tesla executive.
But investors have grown pessimistic about the ability of Lucid, Rivian and other electric car start-ups to gain significant market share. The least expensive Air starts at $87,400 while the top of the line goes for $169,000, pitting it against established carmakers that have begun selling battery-powered luxury cars, like Mercedes-Benz, Audi and Porsche.
The traditional carmakers were slow to develop electric cars that resonated with consumers, but now their decades of experience and networks of factories are proving a decisive advantage. Ford Motor said Wednesday that it sold 7,700 battery-powered vehicles in the United States in July, an increase of 170 percent from a year earlier. Ford has sold 31,000 electric vehicles in the first seven months of the year.
Mr. Rawlinson conceded that much of Lucid’s production shortfall was caused by the company’s inexperience — for example, difficulties setting up a system that delivers the right parts to the assembly line at the right time. Several unplanned shutdowns at Lucid’s factory in Arizona “exposed the immaturity of our logistics processes,” he said.
Lucid has hired several executives from traditional carmakers to straighten things out, including Steven David, former vice president of manufacturing at Fiat Chrysler Automobiles. Mr. David, whose appointment was announced Wednesday, will be senior vice president of operations.
Lucid’s tribulations were reminiscent of Tesla in 2018 when Elon Musk, the company’s chief executive, went through what he described as “production hell” as the company struggled to ramp up production of the Model 3.
Lucid “appears to be in the ‘production hell’ stage of its development,” Garrett Nelson, vice president at CFRA Research, said in a research note Wednesday.
Expanded incentives for electric car buyers being considered by Congress will not help Lucid. Its sedans will not be eligible for a federal electric vehicle tax credit of $7,500 because its models are too expensive. Under the Senate’s proposed climate and energy package, buyers can claim the credit only for sedans with a list price of $55,000 or less and for vans, sport utility vehicles and trucks selling for $80,000 or less.
Lucid’s share price has tumbled from a high of $55 in November to less than $20 recently. The company’s stock was down about 11 percent in extended trading on Wednesday after it announced that it was cutting its production forecast.
The company lost $220 million in the second quarter on sales of $97 million. That compared with a loss of $81 million in the first quarter of 2022 on sales of $58 million. Lucid said it had enough cash “to fund the company well into 2023.”
Today in the On Tech newsletter, Shira Ovide looks at how the United States has handled a ban on phone and internet equipment from two Chinese companies, Huawei and ZTE, and explores what this can tell us about America’s ability to effectively deal with concerns about other Chinese technology.