SCOTUS Overrules Trump; Xbox Goes AI First; Private Equity Wobbles; and Meta Trims Stock Comp

Markets were jolted after the Supreme Court struck down the core of President Trump’s sweeping tariff program, prompting an immediate White House countermove with a new global levy,  first at 10%, then raised to 15%. In corporate boardrooms, Microsoft’s longtime Xbox chief is stepping aside as the company doubles down on AI leadership, alternative asset manager Blue Owl is facing investor scrutiny over loan sales and liquidity concerns, and Meta is trimming employee stock awards as it channels even more capital into its artificial intelligence ambitions. All this and more in today’s Read It and Eat!

Markets Around The World

Markets as of 20th February 2026. Cells in RED mean that the value is down, cells in Green mean the value is up.

MAJOR HEADLINES

• Supreme Court Rules Against Trump's Tariffs; Trump Retaliates With Even More Tariffs

The Supreme Court scrambled the US trade landscape Friday when it struck down the centerpiece of President Trump’s second-term tariff program, ruling 6-3 that his sweeping blanket tariffs are illegal. The ruling came just over one year into Trump’s second term and after skeptical questioning from key justices during oral arguments last November. It appears set to immediately halt a massive section of Trump’s tariffs, which were announced last year on “Liberation Day” using a 1977 law called the International Emergency Economic Powers Act (IEEPA). “IEEPA does not authorize the President to impose tariffs,” read the decision, written by Chief Justice John Roberts.

Trump attacked the high court in his first response Friday, particularly the justices in the majority, saying they were a "disgrace to our nation." He hinted that the administration would pursue alternative methods toward implementing its trade goals. His first move: Imposing a 10% "global tariff" under Section 122 of the Trade Act of 1974. That statute allows the president to impose tariffs of up to 15% for up to 150 days to address trade deficits. After 150 days, Congress would need to approve any extension. That authority, however, has never been used to impose tariffs. The president signed an executive order late Friday imposing the 10% tariffs under Section 122. Then on Saturday, he raised the levy to 15% "Please let this statement serve to represent that I, as President of the United States of America, will be, effective immediately, raising the 10% Worldwide Tariff on Countries, many of which have been 'ripping' the U.S. off for decades, without retribution (until I came along!), to the fully allowed, and legally tested, 15% level," Trump wrote in a social media post.

The SCOTUS ruling also raised the question of refunds, which could return over $100 billion to importers in the months ahead. It upholds two lower courts,  including the US Court of International Trade that previously found Trump did not have the authority to impose global tariffs using the 1977 law. The decision will have wide-ranging ramifications, affecting global trade, consumers, companies, inflation and the pocketbooks of every American. In recent weeks, Trump has already made plans to roll back some tariffs on metals, including on steel and aluminum goods, as he and his administration seek to battle an affordability crisis ahead of the midterm elections. Yahoo.Finance

•  Microsoft Xbox chief Phil Spencer retires, replaced by AI executive Asha Sharma

Microsoft's head of gaming, Phil Spencer, is leaving the software maker following a 38-year tenure, as the company's Xbox business faces increased challenges. Spencer's exit follows the departures of business development chief Chris Young and GitHub CEO Thomas Dohmke in 2025. Charlie Bell, who had been Microsoft's most high-ranking security leader, switched to an individual contributor role earlier this month. 

Revenue from video games at Microsoft declined about 10% in the December quarter from a year earlier, a steeper drop than the company expected, while total revenue grew nearly 17%. Microsoft announced an unspecified impairment charge in its gaming business in January. The company made a $75 billion bet to expand its games business with the 2023 acquisition of Activision Blizzard, and it released Call of Duty titles as a cloud service. But current generation Xbox consoles haven't been as popular as Sony's PlayStation or Nintendo's Switch, and Microsoft has shuttered studios working on new games. 

Asha Sharma, who joined Microsoft in 2024 from Instacart, will take over for Spencer, becoming CEO of gaming and reporting to Nadella. Until now, she has been president of product in Microsoft's Core AI business, which former Meta executive Jay Parikh runs. Before arriving at Instacart in 2021 and serving as operating chief, Sharma spent four years as a vice president of product and engineering at Meta and two years in marketing at Microsoft.  Matt Booty, head of Microsoft's gaming studios, will report to Sharma as executive vice president and chief content officer. "Together, Asha and Matt have the right combination of consumer product leadership and gaming depth to push our platform innovation and content pipeline forward," Nadella wrote. CNBC

• Blue Owl Wobbles; Shaking The Entire Private Equity Sector With It 

Blue Owl Capital shares extended their selloff for a second session on Friday, as the alternative asset manager's plan to return capital from a debt fund stoked concerns around private-lending standards and a liquidity crunch in the sector. The stock which has been battered severely had also frozen capital withdrawals from their individual investors to prevent a first of its kind PE run.

Blue Owl stock was also weighed down by a Bloomberg News report that the investment manager had sold the portfolio of loans to three of North America's biggest pension funds, as well as its own insurance firm,  Chicago-based Kuvare. Investment firms Saba Capital and Cox Capital said on Friday they had offered to buy shares in three Blue Owl funds at a 20-25% discount to their most recent published valuations.

In an interview with CNBC, Blue Owl Co-President Craig Packer said each of the four institutions the company sold its assets to had appetite to buy more. About "the fact that one of the four might be part of our insurance business; How is it reasonable that would undermine the other 75% of the sales?" Packer told CNBC. Blue Owl had said the debt it was selling spanned 128 portfolio companies across 27 industries, with the largest concentration, 13%, in software and services. It sold the loans at 99.7% of par value, matching its own book marks, which the firm cited as validation of its valuations. Packer said Blue Owl was being "super selective" about making loans to software companies. Reuters

• Meta cuts stock awards by 5% for most employees

Meta reduced its annual distribution of stock options by about 5% for most of its staff, as CEO Mark Zuckerberg ploughs billions of dollars into its artificial intelligence goals.  The social media company said in January that it expected capital expenditure for 2026 to be between $115 billion and $135 billion. Meta has slashed equity-based awards for the bulk of its employees for the second year in a row, the report said, citing people familiar with the matter.

Last year, the company had cut the stock award by roughly 10%, which shocked some staff at the time, the FT report said. Meta last month laid off about 10% of employees within its Reality Labs group, which had about 15,000 workers, as the company redirects resources from some of its virtual reality products to wearables. The unit, which has accumulated more than $70 billion in losses since 2021, includes Meta's ambitious "metaverse" bet.

Meta is building several gigawatt-scale data centers across the United States, including one in rural Louisiana, a project President Donald Trump said would cost $50 billion. Last month, Meta appointed Trump ally Dina Powell McCormick as president and vice chairman in a bid to drive partnerships with governments and investors for its AI projects. Reuters

Minor Headlines

• US banks enjoyed record profits of $300bn in 2025 Financial Times

• General Catalyst commits $5B to India over five years TechCrunch

• Carvana Stock Falls. Earnings Show ‘Growing Pains,’ But Analysts Aren’t Concerned Barron

• EU says it will accept no increase in US tariffs after Supreme Court ruling: 'a deal is a deal' Reuters

• Rolls-Royce urges UK government to commit to subsidies for £3bn engine project Financial Times

• Sergey Brin-Backed Group Tries to Undercut California’s Billionaire Tax Proposal Wall Street Journal

• ASOS co-founder Quentin Griffiths dies in Thailand after balcony fall Reuters

• Miley Cyrus to dust off her blonde wig for Hannah Montana 20th Anniversary Special Avclub