AUTOMAKERS
Renault revenue could drop
Renault SA warned that revenue might decline this year, scrapping a previous goal, after first-half profit was hit by weakening vehicle demand and an earnings collapse at alliance partner Nissan Motor Co in the wake of the scandal over former chairmam Carlos Ghosn. Net income slumped by more than half to 970 million euros (US$1.08 billion) in the January-to-June period, as revenue fell 6.4 percent to 28.05 billion, the French automaker said yesterday. Operating profit also dropped 13.6 percent to 1.654 billion euros. A broad-based downturn has rattled the sector, prompting profit warnings and compounding challenges for Renault and Nissan as they struggle to turn the page on the Ghosn era. Renault’s bottom line was hit by an 826 million euro drop in earnings from its 43.4 percent-owned alliance partner.
NORTH KOREA
GDP contracts 4.1 percent
North Korea’s economy shrank for a second straight year last year, and by the most in 21 years, as it was battered by international sanctions aimed at stopping its nuclear program and by drought, South Korea’s central bank said on Friday. North Korea’s GDP contracted by 4.1 percent last year in real terms, the worst since 1997 and the second consecutive year of decline after a 3.5 percent fall in 2017, the South’s Bank of Korea estimated. North Korea does not disclose any statistics on its economy. The South Korean central bank has been publishing its estimates since 1991, based on information from various sources, including the South’s foreign trading agencies. North Korea’s international trade fell 48.4 percent in value in last year as toughened international sanctions cut exports by nearly 90 percent.
TELECOMS
Vodafone plans separation
Vodafone Group PLC plans to carve out its phone towers into a new business and consider an initial public offering or minority stake sale to lower debt. The shares rose as much as 8.5 percent in early London trading after the carrier announced plans to separate Europe’s largest towers portfolio by May next year. The business is to consist of 61,700 masts in 10 countries, Vodafone said in a statement alongside financial results that beat expectations. Telecom infrastructure businesses that are separate from their phone-carrier customers command richer valuations, because they have steady income streams that are insulated from the underlying consumer.
CHEMICALS
Judge cuts Roundup payout
A California judge on Thursday reduced a US$2 billion jury verdict, slashing the award for a couple who blamed Bayer AG’s glyphosate-based weed killer Roundup for their cancer to US$86.7 million. Superior Court Judge Winifred Smith of the California Superior Court in Oakland said that the jury’s punitive damages awards were excessive and unconstitutional, but rejected Bayer’s request to strike the punitive award outright. Under Smith’s final order, California couple Alva and Alberta Pilliod would receive about US$17 million in compensatory and US$69 million in punitive damages, down from US$55 million and US$2 billion, respectively. The plaintiffs still have to formally accept the reduced award. Bayer said in a statement that Smith’s decision to slash the award was a step in the right direction, but added it would file an appeal.
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