BANKING
BNP issues profit warning
BNP Paribas SA, France’s largest bank, reported a surge in fourth-quarter profit, but said that new rules and higher taxes would weigh on earnings next year. Net income rose to 1.3 billion euros (US$1.48 billion) from 110 million euros the year before, when the bank set aside US$1.1 billion for legal costs, the Paris-based bank said in a statement yesterday. That compares with an average estimate of 1.34 billion euros by seven analysts surveyed by Bloomberg. Toughening demands from international regulators and escalating levies on Europe’s largest banks are set to dent next year’s net income by about 500 million euros, BNP estimated. In addition, the euro region’s economic recovery is weaker than the bank had foreseen when setting profitability goals last year and interest rates are lower, which might erode returns.
MACROECONOMICS
Swiss confidence declines
Confidence among Swiss consumers declined after the Swiss National Bank gave up its ceiling on the franc, a survey published yesterday found. While the index of consumer confidence measured minus-6 last month, compared with minus-11 in October last year, the portion of the survey conducted after Jan. 15 revealed a reading of minus-17, according to Switzerland’s State Secretariat for Economic Affairs. Analysts predict Swiss economic growth will lose pace this year after the central bank stunned markets on Jan. 15 by giving up its ceiling on the franc of 1.20 per euro. The franc has been trading near parity since then.
ELECTRONICS
Samsung promotes own OS
South Korean electronics giant Samsung Electronics Co yesterday started domestic sales of high-end televisions powered by its Tizen operating system and plans to add washing machines, refrigerators and other appliances to the range of products that use the software. The new TVs come in four sizes from 55 inches diagonally to 88 inches. The smallest model costs 5.49 million won (US$5,000). The company’s smartphones and tablets rely on Google’s Android operating system, despite its efforts to develop Tizen as an alternative. Samsung’s TV business head Kim Hyun-seok said all of the company’s Internet-connected TVs would be powered by Tizen this year, as well as refrigerators, washing machines, air-conditioners and robotic vacuum cleaners.
TELECOMS
BT Group to buy EE Ltd
BT Group PLC agreed to buy British mobile carrier EE Ltd for £12.5 billion (US$19 billion) to create a wireless and broadband giant set to shake up the country’s telecommunications industry. Orange SA and Deutsche Telekom AG, the French and German owners of the four-year-old venture, are to receive a mixture of cash and new BT shares, London-based BT said in a statement yesterday. The combination is set to generate cost savings and additional revenue valued at about £3 billion after costs. The deal, which needs antitrust approval, would probably be completed by March next year, BT said. If the transaction is completed, BT will control the biggest high-speed broadband network as well as the largest wireless operator in the UK, letting it sell packages of mobile, TV, home phone and Internet services. The move has fueled talks among rivals, including Sky PLC and Vodafone Group PLC, as they look for ways to bulk up or add services to create their own bundles.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to