CONGLOMERATES
GE posts higher Q4 profit
General Electric Co (GE) posted increased revenue and profit for the fourth quarter on rising sales in emerging markets, higher banking profit, and stronger global sales of aircraft engines and oil and gas drilling equipment. However, GE shares fell 2.3 percent on Friday, because the company failed to increase its profit margin as much as it had predicted. Its profit for the full year rose, although revenue fell slightly, as the firm continues its transformation from a sprawling conglomerate to a more focused industrial company that builds and services complex equipment such as CT scanners, locomotives and gas-fired turbines. GE reported that its net income rose 5 percent to US$4.2 billion, or US$0.41 per share, for the October-December period on revenue of US$40.38 billion. That is up from US$4.01 billion, or US$0.38 per share, on revenue of US$39.16 billion in the previous year.
SHIPPING
UPS misses profit forecasts
United Parcel Service Inc (UPS) reported preliminary fourth-quarter earnings that trailed analysts’ estimates after a surge in online shopping just before Christmas forced it to hire more temporary workers than planned and miss holiday deliveries. The company expects earnings per share of US$1.25 (NT$37.50), it said in a statement, falling short of an average estimate of US$1.43 from 26 analysts. Atlanta-based UPS expects to report an adjusted profit of US$4.57 a share for last year, below its prior projection of US$4.65 to US$4.85, it said. Analysts anticipated US$4.75 on average. UPS will report results on Jan. 30.
MACROECONOMICS
France may raise target
French Finance Minister Pierre Moscovici said on Friday that the economy could grow by more than 1 percent this year, higher than the 0.9 percent forecast until now, if new government reforms lead to a return in confidence. “There is a fundamental psychological element of the economy, if all participants ... can mobilize themselves, confidence can return and investment will accelerate,” Moscovici told the daily Le Monde. France has been looking to ride the general global recovery, with growth picking up after a near stagnant 2013. However, French President Francois Hollande announced this week the intention to jump-start the economy with 30 billion euros (US$41 billion) in cuts to payroll taxes and further efforts to balance public finances with 50 billion euros in spending cuts over three years.
FINANCE
Banks drop advance loans
Wells Fargo & Co and US Bancorp are among lenders that plan to stop offering advance loans to direct deposit customers, as the business comes under pressure from regulators and consumer advocates. Wells Fargo, the biggest US home lender, is shutting down its service starting on Feb. 1, the company said yesterday in a statement. Minneapolis-based US Bancorp, the nation’s largest regional lender, said its program would end on Jan. 31, as did Cincinnati-based Fifth Third Bancorp. Regions Financial Corp announced on Jan. 15 that it would discontinue its Ready Advance service this year. Banks are abandoning these products amid intensifying scrutiny from regulators about their high costs and similarities to payday lending.
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure