Daily Pulse: Facebook Earns a Cool Billion, Theranos Gets Whacked, Amazon Owns Half the Country

Facebook shatters expectations. Q4 sales were up 52% and profit was $1.56 billion — more than double year-over-year and the first time net exceeded one billion dollars. Monthly active users rose to 1.59 billion (daily to 1.04 billion) and 90% of both are now mobile. Shares in the social network were up sharply after hours, erasing its entire loss this year.

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"It's doom and gloom all around us and these guys are just killing it," Kevin Landis, CEO/CIO at Firsthand Capital Management, told CNBC's Closing Bell. "One of the really impressive things about this is look at all the other companies in this space, and there's train wreck out there."

'Immediate jeopardy.' After dominating headlines for several months due to its questionable blood-testing technology, Theranos reemerged today thanks to a government probe. The Centers for Medicare & Medicaid Services said in a letter that the startup poses "immediate jeopardy to patient health and safety." The CMS found five different conditions the California lab did not meet. "This survey of our Newark, CA lab began months ago and does not reflect the current state of the lab," Theranos said in a statement. As New Yorker editor Nicholas Thompson pointed out, somewhat jokingly, the verdict is still out on how negatively this news will impact the business:

Don’t Fight the Fed: The Federal Reserve said it was "closely monitoring" the global economy, which sounds harmless enough but was enough to send equities markets into the deep south. One school of thought is that the Fed statement left the door too open for a March rate rise. There’s a simpler theory: "People are nervous so they probably fasten on the fact that the Fed needs to keep an eye on market and international developments," Lisa Kopp, head of traditional investments at U.S. Bank Wealth Management, told CNBC. Among the least impressed with the Fed statement is former Dallas Fed advisor Danielle DiMartino Booth, who’s LinkedIn headline says it all: “Note to the FOMC: Google 'Nuance'”

A New Hope: FCC chairman Tom Wheeler plans to propose new rules that will bust the television set-top box cartel wide open. The idea is to reduce cost, make vastly superior technology that already exists easier widely available and dramatically increase content, from streaming services. This may be of no interest to the growing cadre of cord-cutters, and may seem obscure to most of the traditional TV-watching public. But it’s HUGE. The proof? The industry is lining up hard against it, and, as John D. McKinnon reports in The Wall Street Journal, it's using arguments about the hit to their revenue rather than how the change will impact the customer experience.

Mortgaged Future: Five former brokers were acquitted in London’s so-called Libor trial. The case is complicated, but involves the alleged manipulation of the most commonly used benchmark for trillions of dollars in adjustable rate mortgages. The verdict is a major setback for British regulators who, as Chad Bray reports for The New York Times, “have been criticized for not being as aggressive as the United States Justice Department in pursuing financial crime.”

Today in AI: Chess, Jeopardy, Rubik’s Cube — we humans are used to the machine beating us at our own games. But this is a really big deal: A machine has trounced the European champion of Go, “a 2,500-year-old game that’s exponentially more complex than chess,” writes Cade Metz at Wired. Google is responsible for this outrage, and it's happening a decade earlier than AI researchers thought possible. The secret sauce is technology called “deep learning,” by which a machine can be taught to recognize patterns and, in effect, make what looks, walks and quacks like a decision rather than consider every possibility, an approach known as "brute force."

Amazing Prime: We’re a couple of days behind on this, but it’s such an astonishing claim I couldn’t let it pass: A consumer research group says that nearly half of US households are Amazon Prime members. That’s 35% higher than last year at this time, according to Consumer Intelligence Research Partners — year over year improvement at the end of 2014 was 54%, CIRP says, so growth is slowing. But that kind of penetration by a single retailer — Prime costs $99 a year, to boot — is unheard of.

Cover Art: A model as the bride walks the runway during the Elie Saab Haute Couture Spring Summer 2016 show as part of Paris Fashion Week on January 27, 2016 in Paris, France.

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What you may have missed — and really should read:

• Lena Dunham explains why "No" will be her go-to word this year
• Mohamed El-Erian on how low gas prices went from a blessing to a curse
• Meg Whitman on Sundance: "Seeing the innovations in the entertainment industry confirms what I’ve said before – that today, every company is a technology company."

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• Missed the last update? Catch up: 'Watching the Fed, Spotify Goes Netflix, Lyft Pays $12.25M Settlement'
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