Commerce Secretary Lutnick Says He Visited Epstein’s Island on a Family Trip

Ryan Knutson (0:00)

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Alex Ossola (0:22)

This year's freezing temperatures carry risks for US factories that depend on natural gas. Plus, Commerce Secretary Howard Lutnick faces calls for his resignation over ties to Jeffrey Epstein that were revealed in the latest batch of the Epstein files.

Howard Lutnick (0:36)

I did not have any relationship with him. I barely had anything to do with that person.

Alex Ossola (0:47)

And it's almost Valentine's Day. Would you let a matchmaking algorithm find a date for you? Thousands of Stanford students are obsessed. It's Tuesday, February 10th. I'm Alex Ossola for The Wall Street Journal. This is the PM Edition of What's News, the top headlines and business stories that moved the world today.

Paramount has sweetened its hostile offer to acquire all of Warner Bros. discovery. Warner has chosen a rival offer from Netflix. WSJ deputy media editor Jessica Tungle breaks down how the latest move from Paramount raises the stakes in the Hollywood megadeal.

Jessica Tungle (1:22)

So Paramount's enhanced offer today does address a lot of Warner's concerns, including Paramount has agreed to pay the $2.8 billion breakup fee if Warner terminates with Netflix. The sweetener they added today, it's called a ticking fee, which says for every quarter that they do not close that goes past 2026, they will pay what amounts to around $650 million to shareholders per quarter. The point of the ticking fee is they're saying we're putting our money where our mouth is, this deal will get regulatory approval in 2026 So that's their sweetener. Warner has said we will review it and we'll get back to you, but right now we're not changing our recommendation. They still have a deal with Netflix.

Alex Ossola (2:08)

Jessica says she's spoken to some Warner shareholders and there's a sense that the new offer from Paramount isn't going to change minds.

Jessica Tungle (2:14)

Even shareholders that do want this to change things, think Paramount has to up its bid overall right now for Warner's board to engage.

Alex Ossola (2:24)

Target is laying off about 500 workers in district offices and supply chain sites and says that'll let it invest in more workers in its stores. The retailer also named a new head of merchandising and chief operating officer. Michael Fidelke, who officially started as CEO this month, wants to improve the shopping experience and get sales growing again. New data out today from the Commerce Department show that US retail sales were flat in December, disappointing economists who had expected growth and feeding into concerns about a fragile consumer economy. Speaking of the economy, whether you're hiring or firing or looking for work, we'd love to hear from you. To share your view on the job market or to ask a question of one of our reporters, email a voicenote to wnpod at wsj.com or leave us a voicemail on 212-416-4328.

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In US markets, the S&P and NASDAQ both dropped, with the NASDAQ leading the losses and closing down 0.6%. The Dow edged higher. And in the latest AI worries, a financial technology firm said it had an AI tool that could interpret financial documents and create personalized tax strategies that weighed on financial firms with big wealth management businesses. Shares of Charles Schwab, Raymond James, and LPL Financial all fell 7% or more. In earnings out today, Spotify reported better than expected earnings in the fourth quarter. Its premium subscribers grew 10% from the same quarter a year ago, beating the company's guidance. Shares closed up nearly 15%. Dow Jones, publisher of the Wall Street Journal, has a content partnership with Spotify. And Coca-Cola says it's selling products at different prices and sizes to respond to customers who are financially stretched. But there's no big shakeup of its pricing strategy in store. For the fourth quarter, higher prices and sales volumes lifted revenue by 2%. But analysts expected stronger growth. Its shares fell about 1.5% today. Commerce Secretary Howard Lutnick says he visited Jeffrey Epstein's private island in 2012 Lutnick had previously said that he had cut off ties with a convicted sex offender years before that visit. During a Senate hearing today, Lutnick said he was on the island only briefly.

Howard Lutnick (4:43)

My wife was with me, as were my four children and nannies. I had another couple with, they were there as well with their children. And we had lunch on the island. That is true for an hour. And we left with all of my children, with my nannies and my wife all together. We were on family vacation.