TOURISM
Airbnb exits China
Airbnb Inc yesterday announced that it would stop representing short-term rental properties in China and focus its business in the nation on serving Chinese tourists looking for lodgings abroad. Airbnb joins a series of foreign Internet companies, including Yahoo Inc and eBay Inc, that have pulled out of China after running into fierce local competition and regulatory barriers. “We have made the difficult decision to refocus our efforts in China on outbound travel and suspend our homes and Experiences of Hosts in China, starting from July 30, 2022,” Airbnb China chief strategy officer Nathan Blecharczyk said in a statement on its social media account.
AUDITORS
KPMG, Sykes fined
The UK’s Financial Reporting Council has fined KPMG and its partner Anthony Sykes over its 2010 audit of Rolls-Royce Group PLC, the latest in a long list of audit scandals surrounding the firm. KPMG was ordered to pay £3.4 million (US$4.3 million), reduced from an original fine of £4.5 million because the firm admitted its shortcomings, the Financial Reporting Council said in a statement yesterday. An external independent expert is to assess the firm’s policies, guidance and procedures for audit work. Sykes must pay a sanction of £112,500, which was also reduced for admissions and early disposal from £150,000.
SOCIAL MEDIA
Snap lowers its forecasts
Snap Inc has cut its revenue and profit forecasts below the low end of its previous guidance, sending its shares plunging as much as 31 percent on Monday. The company is also to slow hiring, filling 500 roles before the end of the year, Snap chief executive officer Evan Spiegel said in a note to staff. “Like many companies, we continue to face rising inflation and interest rates, supply chain shortages and labor disruptions, platform policy changes, the impact of the war in Ukraine, and more,” he wrote in the memo. The company’s second-quarter forecast, for 20 to 25 percent year-on-year revenue growth, was already below analysts’ estimates.
AIRLINES
Carrier to issue new shares
Air France-KLM yesterday announced a bid to raise 2.26 billion euros (US$2.42 billion) by issuing new shares, as the debt-laden company seeks to put the COVID-19 crisis that has ravaged its finances behind it. The pandemic cost the Franco-Dutch airline about 11 billion euros over two years, after travel ground to a halt. The airline has about 7.7 billion euros of debt, despite massive bailouts by the French and Dutch governments, which own minority stakes in the former flag carriers that merged in 2004.
BANKING
UBS clients holding funds
UBS Group AG chief executive officer Ralph Hamers said the Swiss bank’s wealth clients are staying invested while holding back from putting new funds to work because of the uncertainty caused by the war in Ukraine and the energy crisis. Hamers expects greater clarity on the direction of markets within the next three months as the world comes to terms with the aftershocks of the COVID-19 pandemic and the situation in China, as well as soaring energy prices and the Russian invasion, he said in a Bloomberg TV interview from Davos, Switzerland, yesterday. “We had to digest three major shocks: the pandemic shock, the war shock and the energy transition shock,” Hamers said.
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
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
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure