Pacific Northwest Microsoft teamed up with online-advertising network YuMe to help sell Internet video ads, stepping up competition with...
Microsoft teamed up with online-advertising network YuMe to help sell Internet video ads, stepping up competition with Google and Yahoo.
Closely held YuMe, based in Redwood City, Calif., matches advertisers with Internet content providers. The company said Monday that it will place ads from its network of advertisers in unsold space on Web videos posted on Microsoft sites.
Microsoft offers video content through its MSN Web sites. Google CEO Eric Schmidt said last week that his company doesn’t know how to make money from its YouTube unit, the most popular U.S. video site.
Most Read Business Stories
- 55,000 in Washington state may have to pay back thousands in jobless benefits
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- Seattle artists worry potential sale of historic INS building could spell the end for their studios
- Frontier cancels flight, citing maskless passengers
Spinoff company focuses on solar
Microprocessor maker Intel says it is starting a solar company to manufacture and supply photovoltaic cells for makers of solar modules.
Intel announced Monday that it will create an independent company called SpectraWatt that will be based in Hillsboro, Ore.
The transaction is expected to close in the second quarter this year, and the project is scheduled to break ground in the second half of 2008, with shipments to begin by mid-2009.
Oil hits record, then retreats
Crude-oil futures swung wildly Monday, rising to a record then tumbling as investors wrestled with whether they should put stock in Saudi Arabia’s promise to boost production. Retail-gas prices rose to a record $4.08 a gallon.
Light, sweet crude for July delivery fell 25 cents to settle at $134.61 a barrel on the New York Mercantile Exchange after earlier soaring to a trading record of $139.89. Earlier, they dropped as low as $132.84.
Software maker’s profit rose 41%
Adobe Systems reported Monday its profit rose 41 percent in the second quarter because of its strong sales in worldwide markets.
For the three months ended May 30, the maker of Photoshop design software and the Acrobat publishing tool reported net income of $214.9 million, or 40 cents per share, compared to $152.5 million, or 25 cents per share, in the same quarter a year ago.
Excluding special items, the software maker reported income of $272.7 million, or 50 cents a share, compared with $223.2 million, or 37 cents a share in the same quarter a year ago.
On that same basis, analysts polled by Thomson Financial had predicted, on average, earnings per share of 46 cents on revenue of $880 million.
Actual revenue beat those expectations at $886.9 million, up 19 percent from $745.6 million a year ago.
“Our strong performance in Q2 was driven by the product mix and geographic diversity of our business,” said Shantanu Narayen, Adobe’s chief executive officer in a company statement.
Shares of Adobe, based in San Jose, Calif., with about 1,000 workers in Seattle, closed at $42.85, up less than 1 percent, before the results were announced. They were down 38 cents, or 0.9 percent, in after-hours trading Monday.
Corn prices surge in wake of flooding
Corn prices surged to a record Monday, with some contracts briefly topping $8 a bushel for the first time ever as traders bet that a major swath of this year’s crop will be lost to Midwest flooding.
The concerns were underscored after the markets closed, when the U.S. Department of Agriculture estimated that 43 percent of this year’s corn crop is in fair to very poor condition vs. 30 percent at this point in 2007, which eventually produced a record harvest.
USDA last week reduced its estimate for corn production, given severe Midwest flooding and heavy rain, while predicting corn supplies could fall to the lowest level since 1996. Farm Futures magazine said more than a third of producers responding to an online poll hadn’t been able to plant a full crop.
CEO takes blame for big losses
Lehman Brothers Chief Executive Richard Fuld on Monday took the blame for the company’s staggering second-quarter loss, and said the investment bank was too slow in reacting to the credit crisis.
Fuld declared it was his responsibility in his first comments since the bank forecast last week it lost nearly $3 billion from bad bets in mortgage-backed securities and other risky investments. As the longest-serving CEO left on Wall Street, his mission now is clearly to restore confidence to the firm’s tarnished image.
He pointed out that the investment house has acted quickly since recording its first loss since going public in 1994. Lehman last week raised $6 billion of fresh capital and demoted its chief financial officer and chief operating officer.
Lehman also reduced the size of its balance sheet by $147 billion, more than Fuld had targeted for the quarter. Meanwhile, it slashed mortgage holdings by 20 percent — higher than the original forecast of 15 percent.
Health-care costs rising for employers
Employer health-care costs are poised to rise almost 10 percent in 2008 — more than double the annual inflation rate — and nearly that much again in 2009, according to an industry report being released today.
The study by PriceWaterhouseCoopers predicts that medical costs will increase 9.9 percent in 2008 and an additional 9.6 percent in 2009.
“Health-care providers, insurers and employers will have to monitor medical costs carefully if we are to avoid a resurgence of the double-digit annual increases seen in the past,” said David Chin, leader of the Health Research Institute at PriceWaterhouseCoopers.
PriceWaterhouseCoopers surveyed more than 500 employers and health plans, with total coverage of more than 11 million people, for the report.
Industry watchers have faith in CEO
When Robert Willumstad said goodbye to Citigroup three years ago, he boldly declared he was leaving to run a major company. Now, at 62, he’s making good on that promise — at a floundering AIG during the most challenging climate of his four-decade career.
Wall Street has yet to be convinced that American International Group (AIG) is headed for profitability anytime soon. Not only did the world’s largest insurer get trampled when the credit markets seized up last year, but it also never quite recovered from then-New York Attorney General Eliot Spitzer’s industry shake-up a few years ago.
But if AIG needs a cleanup, most industry watchers are saying — tentatively — that Willumstad is the man for the job. Trained by the master cost-cutter himself, Citigroup’s ex-CEO Sanford Weill, Willumstad had a strong record at the world’s biggest bank by assets.
He’s also been on AIG’s board since 2006, long enough to know the basics of what went wrong at the company during the last year.
Hope Now Alliance
Speedy answers for borrowers
Mortgage companies, facing criticism that they aren’t doing enough to stem the housing crisis, are pledging to let troubled borrowers know whether they’re approved for help within 45 days of receiving a homeowner’s application.
The promise is expected to be announced today by the Hope Now alliance, a Bush administration-backed industry group, as part of a new set of guidelines for mortgage companies participating in the effort. The Associated Press obtained a copy of the guidelines.
The agreement is designed to clarify the mortgage-assistance process for borrowers and the industry alike but is not legally binding.
It also tries to alleviate a major stumbling block: the reluctance of companies that hold second mortgages, such as home-equity loans, to agree to such modifications. Such requests should be approved, the agreement says, unless the holder of the second mortgage would be put in a worse financial position.
$75 million to settle kickback case
The Milberg law firm said Monday it will pay $75 million to settle a federal kickback case involving class-action lawsuits against some of the nation’s biggest corporations.
The New York firm said in a prepared statement the deal called for the government to dismiss all charges against it.
The U.S. attorney’s office in Los Angeles, which is handling the case, declined immediate comment.
The firm was accused of making $250 million over two decades by filing legal actions on behalf of professional plaintiffs who received $11.3 million in kickbacks.
The firm, then known as Milberg Weiss was charged with aiding and abetting mail fraud and money-laundering conspiracy. A trial had been expected to start in August.
The firm will make payments to the government totaling $75 million over the next five years.
Compiled from The Associated Press, USA Today and Bloomberg News