CHIPMAKERS
Qualcomm profits tumble
Qualcomm Inc, the biggest maker of chips used in mobile phones, forecast steep declines in profit and licensing sales, underscoring its dependence on the royalties that one of its largest customers, Apple Inc, has stopped paying. Sales in the company’s licensing division, which collects fees for use of its mobile technology, will sink as much as 47 percent in the current period to as little as US$1 billion, the company said on Wednesday. That will drag down overall revenue by as much as 13 percent in the quarter, which ends in September. The guidance excludes patent fees related to products from Apple and another customer whose contract is in dispute.
SOFTWARE
SAP raises revenue outlook
Software giant SAP SE yesterday raised its annual revenue outlook and said it would buy back up to US$500 million in stock after reporting a better-than-expected jump in sales, lifted by a revamped version of its flagship software. The German maker of applications that run businesses’ finances, manufacturing and personnel is projecting sales of 23.3 billion euros to 23.7 billion euros (US$26.8 billion to US$27.2 billion) this year, based on constant currencies. That is up about a 100 million euros on both ends of its prior forecast. SAP is about to start a share buyback of up to 500 million euros this year and it is raising its outlook for cloud and software revenue.
CONSUMER PRODUCTS
Unilever reports sales hike
Unilever PLC, the owner of brands like Hellman’s, Lipton, and Knorr, yesterday said its net profit rose 22.4 percent in the first half of this year compared with the same period last year, to 3.3 billion euros as a company-wide growth program bore fruit. Unilever said that first-half sales rose 5.5 percent to 27.7 billion euros, calling its earnings a “substantial step-up in profitability despite the persisting volatile global trading environment.” The strong results came in a period in which rival consumer products giant Kraft Heinz withdrew a US$143 billion takeover offer.
JAPAN
Trade surplus rebounds
The nation logged a trade surplus of nearly US$4 billion last month, rebounding from a deficit the previous month, but its politically sensitive surplus with the US slipped, government data showed yesterday. The world’s third-largest economy logged a surplus of ¥439.9 billion (US$3.92 billion), down 35.9 percent from the same month a year earlier, according to data from the finance ministry. Overall exports last month rose 9.7 percent from a year earlier to ¥6.61 trillion, marking the seventh consecutive monthly rise. Imports expanded 15.5 percent to ¥6.17 trillion, logging the sixth straight monthly increase.
AUSTRALIA
Record rise in employment
The nation recorded the biggest back-to-back increase in full-time hiring in 29 years as the center of its mining boom showed signs of exiting a protracted investment slump. Government data released yesterday showed employment advanced 14,000 last month from May, compared with economists’ forecast of a 15,000 gain, as the jobless rate rose to 5.6 percent. Full-time jobs surged by 62,000 after a 53,400 gain in May, the biggest two-month increase since January 1988, while part-time roles fell 48,000, data showed. The labor participation rate rose to 65 percent from 64.9 percent.
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