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Shares of GameStop fell more than 15% on Thursday after the company’s plan to finance its bitcoin pivot raised questions about the timing of its move and its strategy to turn around its struggling retail business. The video game retailer’s shares also gave up all their gains from a day earlier and were on track for their biggest one-day fall since last June, after the company said it was offering $1.3 billion in 0% 2030 convertible bonds to amass the cryptocurrency. The company’s announcement that it would buy bitcoin to hold as a treasury reserve asset had created a mini euphoria among retail traders, who keenly track the so-called “meme stock.” However, GameStop also announced the closing of a “significant number” of additional stores this year, signalling that its retail business continued to flounder despite attempts to turn it around. “Investors are not necessarily optimistic on the underlying business,” said Bret Kenwell, U.S. investment analyst at eToro. “There are question marks with GameStop’s model. If bitcoin is going to be the pivot, where does that leave everything else?” The timing of GameStop’s decision to buy bitcoin is also in focus as the cryptocurrency’s price has gained nearly 27% since November’s presidential election, though they are sharply down from record highs due to uncertain economic conditions. “Why did (GameStop) wait so long if they were going to go down this road? Six months ago, nine months ago would have made a lot more sense,” Kenwell said. The debt offering to fund bitcoin purchases mimics the playbook of Strategy, one of the largest individual holders of bitcoin that is widely seen as a bitcoin proxy. The overall outlook for crypto markets was also contributing to declines as GameStop’s move has “failed to meaningfully boost market confidence,” said Agne Linge, head of growth at decentralized bank WeFi. With the day’s losses, GameStop shares have dropped more than 23% this year. Lisa Pauline Mattackal, Reuters
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E-Commerce
X owner Elon Musk was privately messaging with Reddit CEO Steve Huffman while also putting public pressure on the social media company’s content moderation efforts, The Verge reported Thursday. Two months ago, several Reddit subreddits started to block links to X in protest of Musk appearing to give the Nazi salute. Musk called the efforts “insane,” while a Reddit spokesperson at the time clarified that Reddit itself wasn’t imposing a ban on the links. A few days later, Musk claimed that Reddit users who were calling for violence against members of his Department of Government Efficiency were breaking the law. Musk has been a vocal critic of content moderation on social platformsparticularly since buying Twitter, now X, in 2022to where he’s rolled back many trust and safety policies. At the same time, unironically, he’s been known to restrict links to other platforms on X. And this certainly isnt the first time Musk has gone after criticsjournalists, users, even employees. Last month, Musk reportedly fired a Tesla manager who criticized Musk for a social media post that used the names of Nazis as wordplay. The Verge reported that “shortly after” Musk and Huffman talked, Reddit enacted its 72-hour ban on the r/WhitePeopleTwitter subreddit, saying it was “due to a prevalence of violent content.” Reddit also fully banned a subreddit called r/IsElonDeadYet for breaking rules “against posting violent content.” The r/WhitePeopleTwitter subreddit, which has more than three million followers, is mostly made up of users screenshotting posts from Bluesky and X. The r/IsElonDeadYet page consisted of a daily post asking whether he was, in fact, dead or not, according to an archived version of the site in December. Reddit moderators learned that the two leaders had spoken, according to The Verge, and discussed it. In response to a user who said Musk is allowed to call out death threats, another reportedly said: “Oh, I dont have any problem with removing rule-breaking content (and taking the respective admin action on said accounts), but I find it a bit problematic that hes able to exert influence on both public and private institutions.” Reddit has had ongoing tension with moderators and power usersespecially after a policy change requiring some third-party developers to pay much more for its application programming interface led to widespread protests in mid-2023. The company, which went public last year, has struggled to maintain balance between changes from its leadership team and its hundreds of millions of monthly global users.
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E-Commerce
In a major overhaul, the U.S. Department of Health and Human Services will lay off 10,000 workers and shut down entire agencies, including ones that oversee billions of dollars in funds for addiction services and community health centers across the country. Health Secretary Robert F. Kennedy Jr. criticized the department he oversees as an inefficient sprawling bureaucracy in a video announcing the restructuring Thursday. He faulted the department’s 82,000 workers for a decline in Americans’ health. I want to promise you now that we’re going to do more with less, Kennedy said in the video, posted to social media. The restructuring plan caps weeks of tumult at the nations top health department, which has been embroiled in rumors of mass firings, the revocation of $11 billion in public health funding for cities and counties, a tepid response to a measles outbreak, and controversial remarks about vaccines from its new leader. Still, Kennedy said a painful period lies ahead for HHS, which is responsible for monitoring infectious diseases, inspecting foods and hospitals and overseeing health insurance programs for nearly half the country. Overall, the department will downsize to 62,000 positions, losing nearly a quarter of its staff 10,000 jobs through layoffs and another 10,000 workers who took early retirement and voluntary separation offers encouraged by President Donald Trumps administration. The cuts were first reported by The Wall Street Journal. Public health experts, doctors, current and former HHS workers and congressional Democrats quickly panned Kennedys plans, warning they could have untold consequences for millions of people across the country. These staff cuts endanger public health and food safety, said Brian Ronholm, director of food policy at Consumer Reports, in a statement. They raise serious concerns that the administrations pledge to make Americans healthy again could become nothing more than an empty promise. But Kennedy, in announcing the restructuring, blasted HHS for failing to improve Americans lifespans and not doing enough to drive down chronic disease and cancer rates. All of that money, Kennedy said of the department’s $1.7 trillion yearly budget, has failed to improve the health of Americans. Cancer death rates have dropped 34% over the past two decades, translating to 4.5 million deaths avoided, according to the American Cancer Society. Thats largely due to smoking cessation, the development of better treatments many funded by the National Institutes of Health, including groundbreaking immunotherapy and earlier detection. Federal health workers stationed across the country at agencies including the NIH and the Food and Drug Administration, both in Maryland described shock, fear and anxiety rippling through their offices Thursday. Workers were not given advance notice of the cuts, several told The Associated Press, and many remained uncertain about whether their jobs were on the chopping block. Its incredibly difficult and frustrating and upsetting to not really know where we stand while were trying to keep doing the work,” said an FDA staffer who spoke on the condition of anonymity out of fear of retaliation. “Were being villainized and handicapped and have this guillotine just hanging over our necks. HHS provided on Thursday a breakdown of cuts at the FDA, the NIH, the Centers for Disease Control and Prevention, and the Centers for Medicare and Medicaid Services: 3,500 jobs at the FDA, which inspects and sets safety standards for medications, medical devices and foods. 2,400 jobs at the CDC, which monitors for infectious disease outbreaks and works with public health agencies nationwide. 1,200 jobs at the NIH, the worlds leading public health research arm. 300 jobs at CMS, which oversees the Affordable Care Act marketplace, Medicare and Medicaid. HHS said it anticipates the changes will save $1.8 billion per year but didn’t give a breakdown or any other details. The cuts and consolidation go far deeper than anyone expected, an NIH employee said. Were all pretty devastated, said the staff member, who spoke on the condition of anonymity for fear of retaliation. We dont know what this means for public health. Union leaders for CDC workers in Atlanta said they received notice from HHS on Thursday morning that reductions will primarily focus on administrative positions including human resources, finance, procurement and information technology. At CMS, where cuts focus on workers who troubleshoot problems that arise for Medicare beneficiaries and Affordable Care Act enrollees, the result will be the lowest customer service standards for thousands of cases, said Jeffrey Grant, a former deputy director at the agency who resigned last month. Beyond losing workers, Kennedy said he will shut down entire agencies, some of which were established by Congress decades ago. Several will be folded into a new Administration for a Healthy America, he said. Those include the Health Resources and Services Administration, which oversees and provides funding for hundreds of community health centers around the country, as well as the Substance Abuse and Mental Health Services Administration, which funds clinics and oversees the national 988 hotline. Both agencies pump billions of dollars into on-the-ground work in local communities. SAMHSA was created by Congress in 1992, so closing it is illegal and raises questions about Kennedy’s commitment to treating addiction and mental health, said Keith Humphreys, a Stanford University addiction researcher. Burying the agency in an administrative blob with no clear purpose is not the way to highlight the problem or coordinate a response, Humphreys said. The new Administration for Healthy America will focus on maternal and child health, environmental health and HIV/AIDS work, HHS said. The Administration for Strategic Preparedness and Response, created by a law signed by then-Republican President George W. Bush and responsible for maintaining the national stockpile that was quickly drained during the COVID-19 pandemic, will also be eliminated and moved into the CDC. Amanda Seitz, Associated Press Associated Press writers Matthew Perrone, Lauran Neergaard, JoNel Aleccia, Carla K. Johnson, and Mike Stobbe contributed to this report.
Category:
E-Commerce
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