Federal deficit down 50%
The federal government ran up a much smaller budget deficit last month than a year ago, remaining on track to record the smallest annual deficit in eight years. The Treasury Department on Friday said that the deficit totaled US$64.4 billion last month, a drop of 50 percent from the same month a year ago. Much of that improvement reflected quirks in timing related to the calendar. Through the first 11 months of this budget year ending on Sept. 30, the deficit is running 10 percent below last year’s level. The Congressional Budget Office is forecasting that the deficit for the full year will drop to US$426 billion, down 11.8 percent from the previous year as a stronger economy brings in more tax revenue.
Airbnb acquires Vamo
Airbnb Inc, the peer-to-peer accommodation platform, has acquired the trip-planning tool Vamo for an undisclosed amount. Under the deal, Airbnb will take on the staff and technology of Vamo, but will shut down by Oct. 1 the tool that uses Big Data to help travelers find deals for multi-destination trips. California-based Airbnb, which allows property dwellers and owners to rent a room or entire home, has about 40 million users worldwide. Traditional hotel chains see Airbnb as a rival and accuse it of helping people avoid taxes and of hosting illegal hotels on its Web site.
Marvell shares plunge 16%
Marvell Technology Group Ltd shares plunged the sharpest in almost 13 years on Friday, after disclosing an internal investigation of its accounting and reporting weakening demand for personal computer parts. The chipmaker’s shares dropped 16 percent to close at US$8.84 in New York, the biggest single-day decline since October 2002. The stock has tumbled 39 percent this year. The investigation is focusing on whether revenue was recognized earlier than it should have been and whether senior management “set an appropriate tone for an effective control environment,” the company said in a statement.
GoDaddy wins Oscars suit
GoDaddy Inc prevailed in a cybersquatting lawsuit brought by the Academy of Motion Picture Arts and Sciences, which accused the Internet domain registrar of illegally profiting off its trademarks, including for the Oscar telecasts. In a 129-page decision on Thursday, US District Judge Andre Birotte in Los Angeles said the Academy failed to show that GoDaddy acted in bad faith by letting customers purchase 293 domain names such as academyawards.net, oscarsredcarpet.com, billycrystal2012oscars.com and theoscargoestothehangover.com. Birotte ruled after a four-day, non-jury trial early last month.
New taxes unveiled
The government has unveiled a host of new taxes to boost revenues hit by a plunge in the price of oil, a key export. On Thursday, Minister of Commerce Bekhti Belaib met with the head of the IMF’s mission in the country, Jean Francois Dauphin, to discuss the crisis. The new budget announced by the government on Wednesday raises taxes on diesel, 3G Internet and electricity consumption. It also raises customs duties on imported electronics.
NOT ALL GOOD: Analysts warned that other data for last month might be less rosy due to the virus and analysts expect the PMI to contract again next month Chinese factory activity saw surprise growth last month as businesses went back to work following a lengthy shutdown, but analysts said that the economy faces a challenging recovery as external demand has been devastated by the COVID-19 pandemic, while the World Bank said that growth could screech to a halt. China is slowly returning to life after months of tough restrictions aimed at containing the virus, which put millions of people into virtual house arrest and brought economic activity to a near standstill. The strict measures saw a closely watched gauge of manufacturing plunge to its lowest level on record in February,
The output of the global smartphone industry this year is to contract by 7.8 percent on an annual basis as the COVID-19 pandemic ushers in a global recession, Taipei-based market researcher TrendForce Corp (集邦科技) said in a report on Monday. The global production of smartphones is expected to fall to 1.29 billion units, as the pandemic dampens demand for consumer electronics, leading to a decline in shipments across Europe and North America, TrendForce said. With consumers delaying smartphone purchases and thereby lengthening the device replacement cycle, overall prices would suffer a setback that is expected to negatively affect the profitability of smartphone
ELECTRONICS Lite-On delays sale of unit Lite-On Technology Corp (光寶科技) yesterday said it would postpone the sale of its solid-state drives (SSD) business to Kioxia Holdings Corp, formerly known as Toshiba Memory Holdings Corp, due to disruptions amid the COVID-19 pandemic. Last year, the Taiwan-based electronics components supplier struck the deal with the Japanese firm, agreeing to sell the unit for US$165 million. Citing unfinished integration work due to the pandemic, Lite-On has deferred today’s closing date until further notice, adding that the delay would not have a negative effect on the unit’s operations. AUTO PARTS Hiroca approves dividend Automotive interior parts supplier Hiroca
ALL ABOUT STRATEGY: The company is optimistic, saying that its gross margin should increase year-on-year, but it is scaling back on its plans to expand capacity Quang Viet Enterprise Co (QVE, 廣越), which makes down jackets and garments for sportswear and outdoor brands including Adidas AG, yesterday said that revenue might drop 5 to 10 percent annually this year as some customers trimmed orders in response to the COVID-19 pandemic. That would mark its first revenue decline since 2016. Quang Viet posted record-high revenue of NT$16.26 billion (US$537.45 million) last year, up 22 percent from 2018. Down jackets made up 40 percent of it revenue last year. North Face Inc and Patagonia Inc are this year likely to reduce orders by 20 to 30 percent from a