WATCHMAKERS
Swatch sees currency losses
Swiss watchmaker Swatch Group yesterday said that its profits rose in the first six months, but its performance was dampened by the strength of the Swiss franc. The group, with its 20 strong brands and its own retail network, generated net sales of 3.7 billion Swiss francs (US$3.9 billion) in the first half, which represented a fractional decline of 0.3 percent compared with the corresponding period a year earlier. At constant exchange rates, sales would have risen by 1.2 percent. Net profit grew by 6.8 percent to SF281 million, slightly short of analysts’ expectations.
LUXURY GOODS
Hermes sales up worldwide
Luxury goods maker Hermes yesterday said that it notched up “solid” growth in the first six months of the year and in the second quarter, driven by rising sales across all regions. Hermes said in a statement that sales grew by 8.9 percent to 1.36 billion euros (US$1.59 billion) in the second quarter of the year, pushing first-half sales up by 11.2 percent to 2.71 billion euros. However, the company cautioned that the first-half performance “cannot be extrapolated over the full year, due in particular to the favorable impact of foreign exchange hedges in the first months of the year.”
AIRLINES
IndiGo prepares share issue
InterGlobe Aviation Ltd, which runs India’s largest airline, has picked banks including Citigroup Inc, JPMorgan Chase & Co and Morgan Stanley to work on an institutional share sale, according to people with knowledge of the matter. The operator of IndiGo is planning the deal to help cut its owners’ stake to achieve the minimum public shareholding of 25 percent, the people said, asking not to be identified because the information is private. To meet requirements, the company or its controlling shareholders must sell a 10.85 percent stake, worth about 49 billion rupees (US$762 million) based on the current share price, according to data compiled by Bloomberg.
GREECE
IMF agrees to new bailout
The IMF agreed to a new conditional bailout for the nation, ending two years of speculation on whether it would join in another rescue and giving the seal of approval demanded by many of the country’s euro area creditors. The Washington-based fund on Thursday said its executive board approved “in principle” a new loan worth as much as US$1.8 billion. The disbursement of funds is contingent on eurozone countries providing debt relief to Greece. IMF officials estimate that, even if Greece carries out promised reforms, the nation’s debt will reach about 150 percent of gross domestic product by 2030 and become “explosive” beyond that point.
ENERGY
Siemens retreats in Russia
German industrial conglomerate Siemens AG yesterday said it is halting deliveries of power generation equipment to state-controlled companies in Russia and selling its stake in Interautomatika, a Russian company that offers services for power plant control systems. The move came after Siemens this month said that gas turbines delivered to Russia had been rerouted to Crimea, in violation both of EU sanctions and a contract. The company said it also “has initiated the termination process of a license agreement with Russian companies in the area of equipment supply for combined-cycle power stations.” Kremlin spokesman Dmitry Peskov yesterday told reporters that Russia did not want to make any comment on Siemens’ decision.
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
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
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