B2| Wednesday, July 31, 2019 *** THE WALL STREET JOURNAL.**
INDEX TO BUSINESSES
These indexes cite notable references to most parent companies and businesspeople
in today’s edition. Articles on regional page inserts aren’t cited in these indexes.
A
Activision Blizzard......B7
Alibaba Group.............B2
Allied Esports
International.............B7
Alphabet.........A2,B1,B12
Altria Group................B5
Amazon.com
.............A1,A2,A6,B1,B13
Apple.........A1,B2,B4,B13
B
Bank of America.......B11
Bayer...........................B3
Beyond Meat.............B13
C
Cadillac Fairview.........B6
Campbell Soup..........B13
Capital One Financial
........................A1,A6,B12
Coffee Day Enterprises
.....................................B1
Comcast.......................B7
Crown Resorts............A9
D
DoorDash.....................B3
Dragoneer Investment
Group.........................B6
F
Facebook................A2,B1
Flutter Entertainment
...................................A11
Ford Motor................B12
G
General Motors.........B12
Goldman Sachs GroupB6
GrubHub......................B3
H
Hershey.......................B2
Hill's Pet Nutrition.....B1
Huawei Technologies
............................... A2,B4
J
Juul Labs.....................B5
K
Kinder Morgan..........B13
Kleiner Perkins Caufield
& Byers...................B13
Koninklijke Philips......B1
M
Mastercard..................B5
McDonald's..................B3
Merck............B5,B12,B13
MGM Resorts
International.............B7
Microsoft.............B5,B13
Mondelez International
.....................................B2
Monsanto....................B3
N
Nestle..........................B2
Newell Brands.............B1
Nike.............................B5
Nintendo......................B5
O
Obvious Ventures
Management...........B13
Opendoor Labs............B6
P
Peloton Therapeutics.B5
Procter & Gamble
........................B1,B2,B12
R
Realogy Holdings........B6
S
Samsung Electronics..B4
Simon Property GroupB7
Slack Technologies.....B6
SN Technologies.......A13
SoftBank Vision Fund B6
Sony.............................B5
Sotheby's....................B5
Sprint..........................A3
Starbucks....................B3
T
The Abraaj Group.....B11
T-Mobile US................A3
U
Uber Technologies.B3,B6
Under Armour......B5,B12
Unilever.......................B2
W
White Castle System.B3
X
Xiaomi.........................A2
INDEX TO PEOPLE
BUSINESS & FINANCE
as well.
The company said in 2017
that it was persuading more
manufacturers to cut excess
space and materials to save
time and money on shipping.
Companies need a consult-
ing firm to certify that their
packaging meets Amazon’s
new standards. One consulting
firm said about 15% of the
packages it has tested needed
to be redesigned.
Amazon offered a $1 credit
to producers for each item
sold in packaging that met the
new standard ahead of dead-
line. Companies that haven’t
complied by Aug. 1 will face a
$1.99 surcharge on each item
sold in packaging that runs
afoul of the new standard.
Brands that adopt more ef-
ficient packaging stand to ben-
efit from lower shipping costs
and Amazon does as well, said
Mike Kuebler, technical direc-
tor and packaging specialist at
Smithers Pira.
Philips Norelco OneBlade cut packaging volume by 80% to comply.
STEPHANIE AARONSON/THE WALL STREET JOURNAL
nomic slowdown around the
globe.
Competition from startups
and the increasing assortment
of store-brand products is in-
tense in many markets. Still,
Procter & Gamble Co. re-
ported strong sales growth for
its latest quarter on Tuesday.
Hershey Co. said a price in-
crease helped results in the
second quarter, and it now
plans another increase cover-
ing its chocolate bars.
Nestlé SA and Unilever
PLC, the maker of Hellmann’s
mayonnaise and various ice-
cream brands, both said or-
ganic sales rose in the first
half of the year.
Mondelez’s second-quarter
organic sales increased 4.6%.
In Europe, the company’s larg-
est market, those sales in-
creased 3.9%, aided in part by
Easter-related sales. In the
U.S. and Canada, organic sales
rose 2.5% as the company
raised prices, but volumes
weakened.
“The developed markets are
showing an acceleration,”
Chief Executive Dirk Van de
Put said in an interview.
Like other food manufactur-
ers, Mondelez also faces
higher costs. Mr. Van de Put
said it has raised prices in the
U.S. as expenses for transpor-
tation, packaging and ingredi-
ents have risen.
Revenue at Mondelez
dropped about 1% in the quar-
ter from the year earlier pe-
riod to $6.06 billion due to
currency fluctuations. Revenue
was slightly ahead of expecta-
tions from analysts, according
to FactSet. The company re-
ported gains from e-commerce
sales channels and in emerg-
ing markets.
Mondelez has sought to
grow its Oreo business in
China, where it worked with a
unit of Alibaba Group Hold-
ing Ltd. to introduce in March
an augmented-reality game fo-
cused on the cookies.
In the U.S., the company
rolled out an Oreo earlier this
year with more filling. It has
been developing new Cadbury
bars and created a chocolate
spread sold in India.
The company has also been
tweaking its portfolio, aiming
to focus on snack products it
believes have strong growth
prospects. Earlier this month,
the company completed its ac-
quisition of a majority stake in
a refrigerated protein bar
product. In May, it sold its
cheese business in the Middle
East and Africa.
Mondelez reported a profit
of $807 million, or 55 cents a
share, for the second quarter,
up from $318 million, or 21
cents a share, the year earlier.
The company’s adjusted profit
of 57 cents a share was in line
with expectations from ana-
lysts.
Cookies and milk-chocolate
products helped to bolster
Mondelez International Inc.’s
sales in the second quarter,
leading the snack maker to
push up its forecast for the
year.
Mondelez said Tuesday that
Oreo cookies and its Cadbury
Dairy Milk offerings posted
gains in the quarter, as did
Nutter Butter cookies, one of
its smaller brands in the U.S.
Mondelez now expects or-
ganic revenue—a figure that
strips out the effects of cur-
rency fluctuations, acquisi-
tions and divestitures—to rise
more than 3% this year, up
from a prior outlook of a 2%
to 3% increase. Shares rose
about 1% in aftermarket trad-
ing Tuesday.
Food manufacturers and
companies that make house-
hold and personal items have
been reporting higher organic
sales, helped by consumers
who continue to spend despite
worries about a broader eco-
BYMICAHMAIDENBERG
Mondelez Raises Yearly Outlook
The snack maker’s revenue dropped about 1% in the second quarter from a year ago to $6.06 billion due to currency fluctuations.
LOIC VENANCE/AGENCE FRANCE-PRESSE/GETTY IMAGES
4.6%
Increase in the company’s
organic sales in the quarter
the retail giant’s platform, he
expects Amazon to keep push-
ing brands to change packag-
ing and other aspects of their
business in ways that are best
suited to its own evolving
strategy.
Amazon has been trying to
make packaging more efficient
for more than a decade. Its ex-
panding e-commerce footprint
is consuming more cardboard
and plastic packaging.
Now, Amazon is trying to
address consumer calls to cut
back on waste while reducing
excess weight and volume to
generate savings on shipping
Continued from the prior page
Amazon
Sets Rules
On Boxes
ther misbehavior or make vic-
tims whole. “That second one
is out the window—no one is
getting their information
back,” Ms. Minow said. “As for
the first one, you have to add
another zero onto it to make it
painful enough.”
FTC Chairman Joe Simons
called the $5 billion Facebook
fine significant compared with
prior U.S. and global privacy
penalties. “The enormity of
this penalty resets the base-
line for privacy cases and
serves as an important deter-
rent for future order viola-
tions,” he said in announcing
the penalty.
This spring, European anti-
trust regulators fined Google
$1.7 billion amid allegations
that the search engine pre-
vented rivals’ ads from dis-
playing on some web pages.
The total amounts to 1.5% of
Alphabet’s 2018 operating ex-
penses, or less than a week’s
worth.
Alphabet reported holding
about $16.6 billion in cash and
equivalents at the end of June,
as well as $104.5 billion in
marketable securities.
In addition, a $5 billion fine
imposed in July 2018 by the
European Union’s antitrust
regulator, which said Google
had abused the dominance of
its Android operating system
to promote its search engine,
was just under 17 days worth
of operating expenses. And a
June 2017 fine of $2.7 billion
by EU antitrust regulators
over Google’s comparison-
shopping service was the
equivalent of 12 days worth.
An Alphabet spokeswoman
declined to comment.
This spring, Alphabet
stressed its cooperation with
European regulators and said
it would let Android users in
Europe choose which browser
and search apps they use.
At the time of the earlier
European penalties, Alphabet
said the decisions ignored
competition between its An-
droid operating system and
Apple ’s iOS and underesti-
mated the value users get
from its shopping ads.
For both Facebook and Al-
phabet, the penalties are
smaller when measured
against the total value of the
companies, rather than annual
operating expenses.
Facebook’s recent fines
combined amount to about
0.9% of the company’s recent
market capitalization, which is
$562.1 billion based on Tues-
day’s closing share price, and
just under 6% of its stockhold-
ers’ equity—a measure of cor-
porate net worth that repre-
sents the difference between a
company’s assets and its liabil-
ities.
Alphabet’s $9.4 billion in EU
fines equate to about 1.1% of
its recent market capitaliza-
tion, which is $860 billion
based on Monday’s closing
share price, and about 4.9% of
its stockholders’ equity as of
June 30.
had inadequately warned in-
vestors about misuse of user
data, works out to just over a
single day’s operating ex-
penses.
A fine over privacy viola-
tions, imposed by the U.K.’s In-
formation Commissioner’s Of-
fice in October—valued then at
$645,000—amounts to about
11 minutes of operating ex-
penses.
A Facebook spokeswoman
declined to comment about the
settlements, and the company
agreed to settle the FTC and
SEC investigations without ad-
mitting or denying guilt. After
the U.K. penalty, Facebook said
it disagreed with some of the
agency’s findings but acknowl-
edged it should have done
more to investigate and act on
complaints years before.
In a news release about the
FTC settlement, Facebook de-
scribed its handling of the pri-
vacy issues that gave rise to
the FTC investigation as “a
breach of trust between Face-
book and the people who de-
pend on us to protect their
data.”
Facebook has said other as-
pects of the settlement—in-
cluding terms requiring the
company to document and as-
sess potential privacy risks
and Chief Executive Mark
Zuckerberg to certify that the
company is meeting its privacy
commitments—are more sig-
nificant than the fine.
“We have a responsibility to
protect people’s privacy,” Mr.
Zuckerberg said in a post last
week on the company’s social-
media platform. “We already
work hard to live up to this re-
sponsibility, but now we’re go-
ing to set a completely new
standard for our industry.”
Nell Minow, vice chair of
ValueEdge Advisors, a corpo-
rate-governance consulting
firm for investors, noted that
financial penalties typically
are meant to discourage fur-
Continued from the prior page
Big Fines
Cause
Little Pain
Facebook fines
as a share of the
company's
annual operating
expenses...
Operating
expenses
About 11
minutes
1.2daysto
equal fine
...and
Alphabet’s
fines
Even large financial penalties
can seem modest when
compared with the finances
of the huge companies on
which they are imposed.
Reason
Operating
expenses
Note: Non-U.S. dollar values converted to U.S. dollars based on exchange rate when penalties were announced. Expense comparison is to nearest
reported full-year results, averaged over 365 days a year, 24 hours a day.
Sources: the companies(operatingexpenses);the agencies(fines)
Penalty date July 24, 2019 July 12, 2019 Oct. 24, 2018
Reason Privacy
disclosures
Cambridge
Analytica
Privacy missteps
Amount $100 million $5 billion $645,000
SEC U.K. Information
Commissioner
Agency FTC
0.32% 16.17%
GDPR
About 4.5 hours
0.05%
—
59 days
Comparison shop
11.6 days
3.20%
Limit rival ads
5.6 days
1.54%
Agency French antitrust EU antitrust EU antitrust EU antitrust
Penalty date January 2019 March 2019 July 2018 June 2017
Android
Amount $56.8 million $1.7 billion $5.0 billion $2.7 billion
16.5 days
4.52%
A
Abdel-Wadood, Mustafa
...................................B11
B
Banga, Ajaypal............B5
Baumann, Werner.......B3
Brown, Ethan............B13
C
Cruz, Shawn..............B12
D
Drahi, Patrick..............B5
F
Frisk, Patrik................B5
J
Jia, Mo........................B4
K
Kinahan, JJ................B12
L
Liang, Howard.............B4
M
Minow, Nell.................B2
Moeller, Jon................B1
N
Naqvi, Arif.................B11
Nickl, Wolfgang..........B3
P
Plank, Kevin................B5
Preston, Tom.............B12
Purdy, Andy.................B4
R
Reddington, Matt.......B1
Reffkin, Robert...........B6
S
Salisbury, Julian.........B6
Siddhartha, V.G...........B1
Simons, Joe................B2
Smith, Tad...................B5
Solomon, David...........B6
Stirewalt, Bryan.......B11
Stritch, Michael........B12
T
Thompson, Paige........A1
W
Walker, Lovell.............B7
Willard, Howard..........B5
V
Van de Put, Dirk.........B2
Y
Yu, Geoffrey..............B12
Z
Zuckerberg, Mark.......B2
roughly three-quarters of its
operating profit from chip
sales.
Following a series of re-
cord profits in 2017 and
2018, Samsung saw its win-
ning streak end late last year
when demand from smart-
phone makers and data-
server companies fell, lead-
ing to lower memory-chip
sales.
To diversify beyond mem-
ory chips, Samsung said in
Continued from the prior page
April it would invest $116
billion by 2030 in other
semiconductor areas, seeking
to tap into new growth driv-
ers.
Samsung said its display
business received a one-time
gain in mobile displays.
Analysts have expected
the company would receive
compensation fees from Ap-
ple, which uses some of Sam-
sung’s flexible displays in
some of its iPhones.
On Tuesday, Apple re-
ported iPhone sales had de-
clined 12% for the three
months ended June 29.
Tokyo’s recent moves to
slow shipments of certain
chemicals to South Korea
took effect July 4, so the fi-
nancial impact won’t be felt
until Samsung reports results
for the current quarter.
Samsung
Earnings
Fall 53%