Jan 2, 2019

Axios PM

By Mike Allen
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Mike Allen

Situational awareness: Apple just issued a rare earnings warning, citing economic deceleration "particularly in Greater China."

  • "In fact, most of our revenue shortfall to our guidance, and over 100 percent of our year-over-year worldwide revenue decline, occurred in Greater China across iPhone, Mac and iPad," CEO Tim Cook wrote today.
  • Go deeper: Axios' Ina Fried is updating this post as we speak.
1 big thing: When the sin industry doesn't pay

Illustration: Sarah Grillo/Axios

The sin industry may be shining during a renewed period of government leniency, but don't expect legal weed and sports gambling to emerge as major revenue sources for cash-starved states.

The big picture: "The expected stampede of states seeking to legalize [sports gambling] has parallels to the growing trend toward legalizing recreational marijuana, which 10 states have done and others are considering," the AP notes.

  • "In Nevada, revenue from sports betting has accounted for roughly one half of 1 percent of the entire state budget."
  • In New Jersey, the gaming industry took "$928 million worth of sports bets. ... The state received less than $8 million in tax revenue."
  • "Even Rhode Island, which has the highest sports betting tax rate at 51 percent, estimates it will take in $23.5 million a year, or a quarter of 1 percent of the state’s budget."
  • Legal weed in Colorado and Washington provides 2% and 1% of state revenue, respectively, the AP notes.

The bottom line: "Baye Larsen, who analyzes state finances at Moody’s, expects sports betting to account for a 'very, very small slice' of state revenue and will do little if anything to help cover their rising pension, Medicaid, education or infrastructure needs."

Go deeper:

Bonus: Pic du jour
Photo: Mark Wilson/Getty Images

A sign on the door of the National Museum of the American Indian states that the museum is closed due to the partial government shutdown.

2. What you missed
  1. Tesla missed Wall Street estimates by delivering 90,700 vehicles in the fourth quarter, and the company said it would slash the cost of all of its models by $2,000, a buffer for the reduced tax credit for electric vehicles that took effect this year. Go deeper.
  2. P.S. on Tesla: Per AP, Tesla “delivered over 245,000 electric cars and SUVs last year, nearly as many as all previous years combined.”
  3. Harry Reid called President Trump "amoral" and "the worst president we've ever had" in a profile by Mark Leibovich for the New York Times.
  4. Analysts overwhelmingly predict the historic bull run has at least one more year to go. Go deeper.
  5. Bakkt, a digital assets and Bitcoin futures platform, raised $182.5 million in first-round funding. Go deeper.
  6. Given all the data Facebook collects and its barrage of data controversies in 2018, expect the social network to be under a microscope this year. Go deeper.
3. 1 "snowman" thing

Photo: NASA/JHU APL/SWRI

The early data from the historic New Year's flyby of a space object nicknamed "Ultima Thule," located about 4 billion miles from Earth, reveals that it's comprised of two joined spheres that are reddish in color, Axios' Andrew Freedman reports.

Why it matters: This is the first so-called "contact binary" ever studied closely by a spacecraft.

  • Ultima Thule used to be two separate objects that are now bound together, according to NASA.
  • It is located in a region of our solar system known as the Kuiper Belt and thought to be a time capsule dating back to the formation of the solar system itself about 4.6 billion years ago.

Go deeper.

Mike Allen