Samsung tech prowess drained by governance woes 7 Jan 2022 Operating profit at the maker of microchips and Galaxy phones is set to hit a four-year high of $11.5 bln. Despite the dominance, it trades at a discount to Apple and TSMC. A recent management shakeup provides a chance to tidy up the leadership mess and boost shareholder returns.
Viewsroom: A $3 trln Apple, Theranos boss busted 6 Jan 2022 The company led by Tim Cook hit another mega-milestone thanks to a lightning focus on the iPhone universe and investor willingness to accord it a market-beating multiple, Richard Beales explains. And Elizabeth Holmes draws bright lines between hype and fraud, Gina Chon says.
Reliance channels its name in 40-year bond 6 Jan 2022 It sold the longest tenure paper by an Indian firm as part of a $4 bln deal, on the back of a big successful expansion into consumer businesses. Bagging cheap funding now looks smart. But as China’s tech upheaval shows, four decades is plenty to test India’s reliance on Reliance.
Toyota’s U.S. triumph comes with an asterisk 5 Jan 2022 The Japanese automaker sold the most cars in the U.S. in 2021, knocking General Motors off pole position for the first time since 1931. But Toyota’s early advantage of hoarded semiconductors is evaporating. And it’s well behind in the race to transition to electric vehicles.
KPN could be buyout barbarians’ next telco target 5 Jan 2022 The Dutch operator rebuffed takeover approaches in May. But KKR’s $37 bln Telecom Italia tilt shows the scale of private equity raiders’ appetites. Spain’s Telefonica and Britain’s BT are probably too big. Without a government shareholder, the $13 bln KPN looks vulnerable.
China Mobile punches up direct-listing numbers 5 Jan 2022 A year after getting run out of New York, the telecom titan sold $8 bln of equity in Shanghai while initiating a $13 bln stock buyback in Hong Kong. Deploying its bloated cash pile is overdue, but such contortions also support the idea of listing shares without raising capital.
Tencent’s Sea rejig keeps most people happy 4 Jan 2022 The Chinese tech behemoth is selling part of its stake in its $120 bln Singaporean peer. Sea also plans a revamp of its supervoting shares so that founder Forrest Li retains control. Li, Tencent and even Beijing can cheer. Minority investors have the least reason to be enthused.
Microsoft and Satya Nadella to be tech standouts 4 Jan 2022 The $2.5 trln software giant has outpaced most Silicon Valley peers over several years. A slowdown might seem inevitable. But the company’s CEO since 2014 is poised to deliver again. That could make him the most successful second-generation tech boss ever in market value terms.
Financial products we’d rather not see in 2022 4 Jan 2022 Breakingviews is readying a new metaverse-based buy-now-pay-later digital-asset trading platform. Here are a few of the shiny new opportunities that could pop up in the coming year, from a melding of SPACs with NFTs to a new crypto-churn account.
Africa’s lofty data-centre prices have solid roots 4 Jan 2022 After deals in Nigeria and Kenya, $50 bln U.S. operator Digital Realty is buying most of South African rival Teraco. The $3.5 bln price tag is eye-catching given the risky location. But the continent’s growing population and rising data demand make the long-term numbers add up.
Theranos jury draws a line between hype and lies 4 Jan 2022 Elizabeth Holmes, who touted non-existent capabilities for her now-defunct blood-testing startup, has been convicted of defrauding investors. If it stands, she faces jail time. Even in Silicon Valley, there's a limit to how flagrantly founders can fake it until they make it.
Nio’s European road trip will earn bragging rights 4 Jan 2022 The Chinese electric-car maker will win foreign fans with a marketing splurge. While it may take years to grab a big share of the $120 bln global market for battery-powered rides, even modest success abroad can put it ahead of rivals, boosting its sales and stock in 2022.
Apple’s $3 trillion valuation is ripe fruit 3 Jan 2022 Boss Tim Cook’s company could be bruised by risks like challenges to the app store and uncertainty in China. Yet the iPhone giant is not badly overvalued despite tripling in market cap in less than four years. It’s still tasty enough to evade the law of large numbers.
Wall Street will find ways to satisfy crypto envy 3 Jan 2022 Banks have mostly been shut out of the $2 trln digital asset craze. Many want in, but they will have to deal with murky regulation, a 24/7 market and patchy legal protections. A fight for profit and customers may also obscure other risks in a market untested by the mainstream.
Banker pay surge prompts rise of the robot analyst 30 Dec 2021 Junior dealmaker salaries blew past $100,000 in 2021 as Morgan Stanley, UBS and others vied for talent. That gives banks a reason to use machines rather than twentysomethings for gruntwork. Old-school bosses may resist, but financial incentives to automate will prevail in 2022.
Red-hot startups face a year of down rounds 29 Dec 2021 Venture capitalists invested more than $600 bln in 2021, an all-time high. The flood of money has boosted private-company valuations. Even a small correction would lower prices, alienating employees. Cash-burning upstarts in areas like rapid grocery delivery are most at risk.
India’s tech stock bubble is poised to deflate 28 Dec 2021 Investors will continue to afford banks and consumer firms dizzying valuations but will increasingly give their money-losing digital brethren a shorter leash. Some mix of rampant competition, slowing user growth and rising data charges will crash the party for the startup crew.
Big Quit sends world’s back office back offshore 24 Dec 2021 When the pandemic fades, and along with it the stigma of letting people go, the WFH revolution will embolden global employers to move jobs to low-cost centres again. While that should benefit India’s IT services providers, they’re ironically grappling with similar problems.
Capital Calls: Enel’s payments punt 24 Dec 2021 Concise views on global finance: The 70 bln euro utility is paying up to 361 mln euros for a relatively pricey punt on fellow Italian payments firm Mooney.
The cult of revenue is flying in thin air 23 Dec 2021 Top-line growth is the surest way to create wealth. But Wall Street has taken a good idea too far. The price-to-sales ratio for tech IPOs is at a 20-year high, even as profitability is dangerously distant. The coming year may sort the durable Amazons from the hyped-up WeWorks.