CEO Daily: Thursday, 9th February

Give Intel CEO Brian Krzanich some credit for how he’s navigating the era of Trump.

Intel has history with the new President. It came under criticism last year from Breitbart News—the alt-right media outlet of presidential adviser Steve Bannon—for announcing a layoff of 12,000 U.S.-based workers, even as it was requesting H-1B visas to bring in foreign professionals. Krzanich also cancelled a Trump fundraiser during the campaign. And Intel, run for decades by proud immigrant Andy Grove, is one of the companies that signed a brief opposing President Trump’s travel ban.

Yet yesterday, the Intel CEO was in the Oval Office, announcing that the company plans to finish a $7 billion chip factory in Chandler, Ariz., that will create 3,000 jobs. While it’s far from clear how much the decision had to do with the new President, Krzanich was happy to give him credit—as a sign of support for the “tax and regulatory policies that we see the administration pushing forward” that could mean a huge boost to the company’s bottom line.

This is the minuet that many CEOs are dancing these days—working to discourage administration moves on immigration and trade that hurt their company’s interests, while encouraging tax reform and regulatory relief that should raise profitability. They could hardly be expected to do anything else.

Yet the dance skirts the real jobs issue that the President and tech CEOs should be spending their time on: how to find real solutions to the continued disruption that’s coming, not from trade, but from technology. Tariffs, immigration restrictions, and Oval Office press conferences aren’t the answer.

More news below.

Top News

• Health Insurers Look to Life After Failed Mergers

A federal court blocked Cigna’s $54 billion acquisition of rival health insurer Anthem on antitrust grounds, effectively ending an ill-fated effort by the industry to consolidate as it struggled with the new obligations of the Affordable Care Act. A similar merger between Humana and Aetna was struck down in January. The deals would have left only three nationwide health insurers of size. The ruling means Anthem will have to pay a $1.85 billion breakup fee to Cigna. Despite the rulings, the share prices of all four are above where they were before they began their attempted round of consolidation, reflecting the expectation that drug companies rather than insurers will take most of the strain as President Trump tries to keep a lid on health costs. Fortune

• Fantastic Beasts and Gathering Cannibals at Time Warner

Time Warner posted better-than-expected quarterly numbers, thanks largely to the Harry Potter spin-off Fantastic Beasts and Where to Find Them, and Westworld, which bolstered a solid contribution from HBO. The company said its U.S. streaming service HBO Now has reached 2 million subscribers, but its forecast of flat pay-TV revenue over the first half again raised concerns of cannibalization. The problem is likely to get more acute if and when Time Warner merges with AT&T, one of whose strategic focuses is on DirecTV Now’s cut-price “skinny bundles.” Fortune

• VW and Piëch Are At War

Volkswagen’s board is on the verge of all-out war as its long-held strategy of pleading ignorance of the Dieselgate issue unravels. Der Spiegel reported Wednesday that ex-chairman Ferdinand Piëch, who dominated the company for two decades, had told German prosecutors in December that he had told both CEO Martin Winterkorn and four of the company’s most important board members, including Lower Saxony Premier Stephan Weil and union boss Bernd Osterloh, of the problems in early 2015. The VW board issued a rare statement “emphatically repudiating” the assertions and threatening legal action against Piëch. Der Spiegel

• Ant Financial Goes Global

Ant Financial, the payments company that powers Alibaba’s Taobao online marketplace, is looking to raise up to $3 billion in debt to help fund global acquisitions, according to various media reports. The company gave notice of intent two weeks ago with the $880 million purchase of Texas-based MoneyGram, its first major deal outside Asia. Ant Financial was the world’s most valuable startup when it raised $4.5 billion last year at a valuation of $60 billion, and international diversification will likely enhance its valuation as it prepares for an IPO, which some expect as early as next year. Fortune

Around the Water Cooler

• Nordstrom Breaks the Curse

An interesting thing happened yesterday. A Twitter bombardment from President Donald Trump caused the share price of Nordstrom to rise over 4%, the first time that such an attack from the President has increased the value of a company. The stock clearly outperformed a sector lifted by an optimistic 2017 forecast by the National Retail Federation yesterday. Nordstrom said it was dropping Ms Trump’s line of jewelry and accessories in response to poor sales, especially in the second half of the year (coinciding with her father’s presidential campaign surge to the forefront of the public consciousness). Elsewhere, T.J. Maxx and Marshalls also stopped promoting Ivanka Trump products, although they will continue to stock them. Nieman Marcus has also stopped selling them on its website. Fortune

• Lévy Heads For Publicis Exit on a Low Note

French-based ad giant Publicis posted a thumping 527 million euro ($570 million) loss for 2016 after taking a big charge against digital ageny Razorfish, which it merged last year with Sapient, another of its digital divisions. The company also suffered from loss of key client accounts in the U.S., leading to a 2.2% drop in North American revenue. A 5.9% rise in revenue in Europe ensured a decent-looking 1.4% group-wide increase, only a little below the 1.9% posted by rival Omnicom. Publicis’ CEO of 30 years, Maurice Lévy, is due to step down in June, to be succeeded by creative director Arthur Sadoun. At least he's cleaned house first. FT, metered access

• Zillow Hints at Clouds on the Housing Horizon

Shares in Zillow, which runs online real estate sites such as Trulia and Easy Street, fell 7% after it forecast a bigger-than-expected loss of $40 million this year. Wall Street had expected it to lose less than $1 million. The forecast is interesting for what it may say about the housing market, which tailed off at the end of 2016 after a strong year. A drop in inventory squeezed prices higher for the 58^th straight month in December. Analysts expect further headwinds in the form of Federal Reserve interest rate hikes later this year, although earlier expectations for a hike as early as March have cooled recently. Fortune

• Starbucks Doubles Down in Immigrant Row

Starbucks doubled down on its support of immigrants in the simmering row between business and the Trump administration over its immigration policy. The company said it would partner with Ernst & Young to offer free legal advice to "help navigate immigration issues and get answers in these uncertain times.” It also reached out to staff from countries affected by President Trump’s recent executive order. Starbucks’ move is a more practical show of corporate social responsibility, at least in the U.S., than the more emotional and symbolic offer to hire 10,000 refugees globally that it made immediately after Trump’s order. Fortune

Summaries by Geoffrey Smith Geoffrey.smith@fortune.com;

@geoffreytsmith