Premarket Actions: CEOs Like Jeff Bezos Are Dealing With New Political Realities


What’s happening: Amazon (AMZN) CEO Jeff Bezos has announced that the company “supports an increase in the corporate tax rate” as President Joe Biden pushes for an ambitious infrastructure package. To help pay the bill, Biden proposed raising the corporate tax rate to 28% from 21%.

“We support the Biden administration’s focus on making bold investments in American infrastructure,” Bezos said. “We recognize that this investment will require concessions from all sides, both in specifics of what is included and how it is paid for.”

It’s a notable announcement, especially given that Amazon has come under fire for paying little to no income tax in recent years. The company reported a U.S. federal tax liability of $ 1.8 billion in 2020, compared to net income for the year of $ 21.3 billion.

Amazon’s willingness to increase its tax burden comes as the company has been forced to play defensively on several other fronts.

The online retailer has clashed with lawmakers in recent weeks over a union vote at an Amazon warehouse in Bessemer, Alabama. The ballots are still being counted, but the vote could mark a huge victory for unions and change the way the company engages with hundreds of thousands of American workers.

It also needs goodwill given the bipartisan push for more regulation of Big Tech firms. I like it Facebook (full board) and Google (GOOGL), Amazon faces scrutiny for alleged anti-competitive conduct. Your growth during the pandemic may have only increased the size of the target on your back.
Take a step back: Businesses are preparing for a booming post-pandemic economy that is expected to boost profits and spur growth. JPMorgan (JPM) Chief Executive Officer Jamie Dimon, who delivered his widely read letter to shareholders Wednesday, told my CNN Business colleague Matt Egan that he hadn’t been so optimistic about the US economy “for a long time.”
But executives are also navigating a complicated set of factors that could affect their business: making higher taxes just one bullet in a long list of concerns. Last week, companies included Delta (DAL) and Coca Cola (KO) condemned Georgia’s controversial voting law after being lobbied by activists.

In his letter to shareholders, Dimon wrote that the United States is “clearly under a lot of stress and strain” thanks to the pandemic, racial inequality, the rise of China and “the divisive 2020 presidential elections, culminating in the assault on Capitol Hill. and the attempt to disrupt our democracy. “

The influential Business Roundtable has vowed to fight higher corporate taxes, which it claims will make American businesses less competitive. But it is noteworthy that Amazon has decided to shift its focus elsewhere.

Coinbase Reports Big Growth Before Going On Wall Street

The massive rise in the price of cryptocurrencies has been a huge win for Coinbase, which will debut on the public market next week.

The Latest: The digital currency exchange estimated Tuesday that it generated $ 1.8 billion in revenue during the first three months of the year. That’s more than $ 1.3 billion for all of 2020.

Between January and March, the price of bitcoin, the most popular crypto currency, jumped from less than $ 30,000 to more than $ 58,000, while the price of ethereum more than doubled.

“We have seen high crypto asset prices drive high levels of user activity and trading volume on our platform,” Coinbase CFO Alesia Haas said in a call with investors.

Watch this space: California-based Coinbase is the highest-profile company in the crypto space to go public, and its direct listing on the Nasdaq, which is scheduled for next Wednesday, is getting a lot of attention.

But regulating the crypto space is still a big risk. Last month, Coinbase reached a $ 6.5 million settlement with the Commodity Futures Trading Commission over claims that it provided false or misleading information about transactions and that a former employee conducted manipulative exchanges.

“We are subject to an extensive and highly evolving regulatory landscape and any adverse changes or our failure to comply with any laws and regulations could adversely affect our brand, reputation, business, operating results and financial condition,” the company said. warned in filings with the Securities and Exchange Commission.

Topps goes public with the boom of trading cards

The pandemic has fueled a resurgence in the popularity of trading cards, with the hobby attracting both a new wave of young fans and a stream of profit-seeking professional investors.

That has been good news for Topps, 83, whose brand is synonymous with baseball cards and gum. On Tuesday, the company announced plans to merge with a special purpose acquisition company, or SPAC, reports my colleague from CNN Business, Paul R. La Monica.

The deal would value Topps at $ 1.3 billion.

Topps has been a publicly traded company multiple times throughout its many decades in business. Most recently, it was privatized in 2007 by an investment firm led by former Disney CEO Michael Eisner. That deal was worth $ 385 million.

The Scene: I wrote a deep dive on the trading card craze earlier this year, and the hype hasn’t abated. Last week, an autographed 2000 rookie card for Tom Brady sold for nearly $ 2.3 million at auction.

The industry has also gotten a boost from the craze for non-fungible tokens, or NFTs. Topps recently expanded its business to sell digital editions of its player cards, each with a unique digital token built on blockchain technology. That creates a scarcity that makes them more valuable to collectors.

Until next time

The meeting of G20 finance ministers and central bank governors concludes with a press conference at 10 am ET.

Also today:

  • The latest data on US crude oil inventories is released at 10:30 am ET.
  • The minutes of the most recent Federal Reserve meeting come in at 2 pm ET.
Coming tomorrow: Conagra (CAG), Constellation marks (STZ) and Levi strauss (LEVI) report earnings.

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