Daniel Zhang leaves Alibaba under a cloud 11 Sep 2023 The $230 bln e-commerce group’s outgoing boss has also stepped down as chief of its key computer services unit. The sudden decision upends what seemed a smooth transition of power. It may also delay AliCloud’s spinoff, and with it hopes of boosting the parent company’s valuation.
American economic power is potent but unstable 8 Sep 2023 Washington weaponized the country’s dominance in tech and finance, evidenced by restrictions on Chinese chip imports and Russia sanctions. Such policy power has invited backlash, most recently against Apple’s iPhones. The dynamic makes valuable interdependence harder to sustain.
Apple’s high valuation exposes it to China’s whims 7 Sep 2023 The $2.8 trln tech giant's shares lost 7% in two days after reports said Beijing will impose a ban on officials using iPhones. Current retaliatory measures shouldn’t matter much to valuation. But more draconian assumptions show a problem, especially at Apple’s elevated multiple.
SoftBank’s reduced Arm price tag is still too high 5 Sep 2023 The Japanese group may float its UK chip designer for $50-54 bln. That’s lower than initially hoped, but still implies an implausible future where revenue and profitability soar. If Arm merely grows at recent rates and nudges up margins, its market worth is more like $35 bln.
Nvidia gives Arm IPO a double leg-up 4 Sep 2023 The $1.2 trln semiconductor designer’s AI-inflated stock price provides a following wind for the UK group’s float. Now Nvidia and two peers may endorse its valuation by buying into Arm’s offering. Owner SoftBank will be hoping other investors buy into the somewhat circular logic.
Arm’s changing business model is wildcard for IPO 24 Aug 2023 As well as jumping on the AI bandwagon, SoftBank’s soon-to-float chip designer has altered the way it charges big customers to boost growth and smooth out revenue. If it works, a valuation north of $60 bln looks slightly less implausible. But investors lack evidence so far.
TikTok challenger backpedals into public arena 21 Aug 2023 After nixing a $5 bln reverse merger last year, Triller plans to sell shares in a direct listing. Music videos and live-streamed brawls hosted by stars such as Snoop Dogg have attracted brands. A pivot to social media tools and questionable growth, however, make it a lightweight.
China does Intel a small favor 16 Aug 2023 The chipmaker aborted its $5 bln acquisition of Tower Semiconductor after failing to secure approval from Beijing. The questionable deal was made worse by the target’s struggles. And given the cross-border tech tension, a $350 mln break fee at this stage is a small price to pay.
Capital Calls: Selling Salesforce 15 Aug 2023 Concise views on global finance: After successfully agitating for change at the $200 bln software developer, Jeff Smith’s Starboard and Dan Loeb’s Third Point are offloading their stakes. It’s probably a good time to pocket gains considering the challenges ahead for Big Tech.
CFOs are stepping into a rapidly revolving door 14 Aug 2023 From Alphabet to Tesla to Walgreens, finance chiefs are moving on at a faster rate than usual. One-tenth of the 1,000 largest US companies lost their CFO in the first half. Economic whiplash and expanded job duties are both factors. Higher turnover looks here to stay.
Capital Calls: Exor/Philips 14 Aug 2023 Concise views on global finance: The Agnelli family is making a well-timed bet on the troubled 18 bln euro conglomerate that makes everything from toothbrushes to defibrillators.
Big Tech is mostly leaping a low bar 10 Aug 2023 The stock market’s mood increasingly hinges on the vagaries of tech giants like Meta, Amazon and Apple. In this Viewsroom podcast, Breakingviews columnists discuss how most of their recent earnings held up – even if only compared to muted expectations for their core businesses.
Hey Siri: Screen iPhone calls on Apple’s valuation 3 Aug 2023 The handset that anchors the $3 trln company is due an update soon. Loyal fans will buy it, but most customers are upgrading more slowly. The trend makes it hard to justify paying twice the multiple of earnings as five years ago, despite the record quarterly services revenue.
Superconductivity is wild card for stock market 2 Aug 2023 The possible discovery of material that efficiently carries electricity is a fresh disruption for investors grappling with artificial intelligence. They must decide if it’s real, if it’s viable; how it affects existing markets; if it creates new ones; and when change will happen.
France wins more than Kretinsky in Atos breakup 1 Aug 2023 Billionaire Daniel Kretinsky will buy the IT group’s older assets for 2 bln euros including debt. Paris will be pleased that the other, sexier cybersecurity division stays French. Meanwhile the Czech tycoon gets the ailing unit with little relevance to his other recent purchases.
Capital Calls: Biotech alarm, Spotify’s tightrope 25 Jul 2023 Concise views on global finance: Pharma supplier Danaher’s reduced forecast contrasts biotech doldrums against broader market exuberance, in a warning sign for investors; the Swedish music streamer is caught between margin-hungry investors and music labels.
Capital Calls: Cathay, Telecoms kit makers, Byju’s 14 Jul 2023 Concise views on global finance: The Hong Kong carrier expects to turn a profit; a push into 5G has caught European telecoms gear makers like Nokia and Ericsson short; India’s troubled ed-tech giant appoints a top former banker to a newly formed advisory council.
3D-printing takeover battle misses third dimension 10 Jul 2023 Nano Dimension raised its unsolicited bid to buy control of $1.3 bln Stratasys, making the choice for shareholders tougher. The target’s preferred deal with Desktop Metal partly hinges on elusive revenue synergies. A snubbed offer from 3D Systems may ultimately be the best option.
AI’s deflationary winds will blow away profits 27 Jun 2023 Artificial intelligence could add $8 trln a year to world GDP, McKinsey estimates, defying the gloom about robots replacing humans. Though companies should benefit from lower costs, consumers could use the technology to find better deals. It all adds up to lower prices.
Prosus’ juggle leaves bigger worries up in the air 27 Jun 2023 The $147 bln Dutch investor is ending its complex shareholder structure with South African parent Naspers. It’s simpler for investors, and enables more buybacks. But the group will still have a stake in Tencent it can’t easily sell and lopsided governance, meriting a discount.