STEELMAKERS
Nippon slashes forecast
Nippon Steel & Sumitomo Metal Corp yesterday said its nine-month net profit dropped 20.3 percent as it slashed its full-year profit forecast, citing the impact of plunging oil prices on a Brazilian unit. The Tokyo-based company, one of the world’s biggest steelmakers, said its earnings for the period of April to December last year were ￥153.6 billion (US$1.3 billion), while sales rose 3.6 percent to ￥4.18 trillion. Nippon Steel blamed part of the profit slump on a ￥68.6 billion extraordinary loss that it took due to an unexpected slowdown at its seamless pipe maker Vallourec & Sumitomo Tubos do Brasil (VSB), which supplies the oil and gas market. Nippon Steel also cut its net profit forecast for the fiscal year to March to ￥180 billion, from an earlier estimate of ￥250 billion.
TECHNOLOGY
Facebook spending rises
Facebook Inc founder Mark Zuckerberg is ramping up spending to chase opportunities in messaging and mobile advertising as sales growth slows at Facebook’s main social-networking service. The company said on Wednesday that spending is set to jump 55 percent to 70 percent this year, narrower than the 50 percent to 75 percent range that it projected in October last year. Zuckerberg has said Facebook is investing in messaging, advertising across the Internet, hiring and new technologies such as artificial intelligence. Total expenses in the fourth quarter soared 87 percent to US$2.72 billion. That impacted profit, with the company reporting an operating margin of 29 percent, compared with 44 percent a year earlier. Sales totaled US$3.85 billion, up 49 percent and slower than the 63 percent growth in the fourth quarter of 2013.
BANKING
Deutsche profits surprise
Deutsche Bank AG posted a surprise fourth-quarter profit as provisions for fines and legal settlements declined. Net income in the last three months of last year was 438 million euros (US$495 million), compared with a loss of 1.36 billion euros in the same period a year earlier, the company said in a statement. Nine analysts surveyed by Bloomberg expected a loss of 341 million euros, on average. Litigation costs were 207 million euros compared with 1.11 billion euros in the fourth quarter of 2013. Deutsche Bank raised cash from investors last year to raise capital and bolster returns by seeking to expand the debt trading business as rivals exit. Deutsche Bank co-chief executive officers Anshu Jain and Juergen Fitschen are preparing a fresh strategy after legal costs and stricter regulation curbed profitability. The Frankfurt-based lender was the worst performing large bank stock last year.
TECHNOLOGY
LG sees net profit soar
South Korea’s LG Electronics yesterday said its net profit last year soared 125 percent, boosted by surging sales of its flagship smartphones and television sets. Net income reached 501.3 billion won (US$457 million) last year, compared with 222.7 billion won a year earlier. Operating profit, meanwhile, was up 46 percent to 1.82 trillion won, with sales rising 4 percent to 59 trillion won. The company attributed its strong bottom line to sales of its TV sets and flagship G-series smartphones. The annual profit surge came despite a 205.7 billion won net loss in the fourth quarter — the result of writing off its plasma TV operations. Fourth-quarter operating profit, however, soared 28 percent year-on-year to 275.1 billion won, and sales rose 4.9 percent to 15.3 trillion won.
TECH RACE: The Chinese firm showed off its new Mate XT hours after the latest iPhone launch, but its price tag and limited supply could be drawbacks China’s Huawei Technologies Co (華為) yesterday unveiled the world’s first tri-foldable phone, as it seeks to expand its lead in the world’s biggest smartphone market and steal the spotlight from Apple Inc hours after it debuted a new iPhone. The Chinese tech giant showed off its new Mate XT, which users can fold three ways like an accordion screen door, during a launch ceremony in Shenzhen. The Mate XT comes in red and black and has a 10.2-inch display screen. At 3.6mm thick, it is the world’s slimmest foldable smartphone, Huawei said. The company’s Web site showed that it has garnered more than
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
Vanguard International Semiconductor Corp (世界先進) and Episil Technologies Inc (漢磊) yesterday announced plans to jointly build an 8-inch fab to produce silicon carbide (SiC) chips through an equity acquisition deal. SiC chips offer higher efficiency and lower energy loss than pure silicon chips, and they are able to operate at higher temperatures. They have become crucial to the development of electric vehicles, artificial intelligence data centers, green energy storage and industrial devices. Vanguard, a contract chipmaker focused on making power management chips and driver ICs for displays, is to acquire a 13 percent stake in Episil for NT$2.48 billion (US$77.1 million).
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