Last week's highlights: The U.S. House of Representatives passed a new TikTok divestment bill. The collapse of Supermicrocomputer's stock price led Nvidia to plummet. The U.S. government provided $6.4 billion in subsidies to Samsung Electronics. Lithography machine giant ASML's orders have plummeted. Huawei's flagship phone, the Pura 70 series, is on direct sale. Fujifilm and Konica Minolta are considering integrating their office equipment businesses. Honda will strengthen cooperation with major Chinese IT companies such as Huawei. Tesla announced layoffs, and its market value fell below $500 billion. LVMH's share of French exports exceeds that of the agricultural sector. International Paper acquires DS Smith.
1. The U.S. House of Representatives passed a new TikTok divestiture bill
Following the passage of a bill to force TikTok divestment last month, the U.S. House of Representatives passed a package of foreign aid bills on April 20, including a revised TikTok divestiture bill. The bills will then be packaged and sent to the Senate for consideration, where they are expected to pass soon. The deadline for the new law to divest TikTok has been adjusted from 165 days after it takes effect to 270 days, that is, after the US presidential election in November this year. The President may also exercise a 90-day extension if he determines that the sale is progressing. This extended the maximum period for ByteDance to sell TikTok's U.S. business to about a year.
Related: Tesla CEO Elon Musk posted on the social media platform X on the 19th, "I don't think TikTok should be banned in the United States, although the relevant ban may benefit the X platform." Such an approach is contrary to freedom of speech and expression".
2. The collapse of Supermicrocomputer's stock price led Nvidia to plummet
Super Micro Computer's uncharacteristically late failure to report preliminary earnings ahead of time could mean weaker-than-expected quarterly results. In recent quarters, Supermicro has been pre-disclosing its impressive sales and profit performance. Supermicro Computer closed down 23.14% on April 19, driving its closely related NVIDIA to close down 10%, with a market value of less than $2 trillion and a closing market value of $1.91 trillion. After TSMC lowered its growth forecast for the chip market, global semiconductor stocks retreated, and investors rushed to lock in profits. Related: Taiwan Semiconductor Manufacturing Company (TSMC) lowered its chip market expansion forecast, warning that the smartphone and PC market remains weak. The world's largest advanced chipmaker lowered its forecast for semiconductor market growth (excluding memory chips) to around 10% in 2024. CEO Wei Zhejia also lowered his growth forecast for TSMC's leading foundry. At the same time, the company has maintained its spending estimate for capacity expansion and upgrades this year at between $28 billion and $32 billion.
3. The U.S. government provided $6.4 billion in subsidies to Samsung
To help Samsung Electronics build a factory in Texas, the U.S. government will provide $6.4 billion in subsidies to Samsung under the CHIPS and Science Act. Based on this, Samsung Electronics will invest USD 17 billion in Taylor, Texas, to expand the scale and investment targets of semiconductor factories under construction to a total of USD 45 billion by 2030. This is more than double the size of the originally planned investment. Samsung Electronics will invest in the construction of a new semiconductor factory in Taylor City from 2022 to fully enter the U.S. market. The U.S. subsidy to Samsung is second only to Intel ($8.5 billion) and TSMC ($6.6 billion). Related: Samsung Electronics will produce the latest generation of semiconductors in the U.S. two years earlier than rival TSMC, further boosting U.S. President Joe Biden's efforts to bring advanced chip production to U.S. soil. The South Korean chipmaker will produce 2-nanometer microchips at a new fab it is building in Taylor, Texas. This will be part of a $40 billion investment that will include microprocessor manufacturing, advanced chip packaging and research and development.
4. Lithography machine giant ASML's orders fell sharply
ASML reported new orders for the first quarter that fell short of analysts' expectations, mainly due to slowing demand for the company's state-of-the-art machines in the chip manufacturing industry. Europe's most valuable technology company reported orders of €3.6 billion in the first quarter of this year, compared with a record €9.19 billion in bookings in the fourth quarter of last year. Demand for the company's high-end extreme ultraviolet lithography (EUV) lithography machines fell sharply, with orders falling sharply to 656 million euros from 5.6 billion euros in the previous quarter. The company expects second-quarter sales to be weaker than expected before demand starts picking up. CEO Peter Wennink said. "We expect 2024 to be a year of transition. "Related: The U.S. and Dutch governments are negotiating on restricting lithography machine manufacturer ASML from providing services for relevant equipment purchased by Chinese customers, in this context, ASML CEO Peter Wennink said on the 17th that there is no reason for the company not to provide services for equipment that has been sold to Chinese customers. ASML's chief financial officer, Roger Dassen, said that about 20 percent of the company's unfulfilled orders came from Chinese customers. He also said that Chinese chipmakers are expanding the production of some "mature" chips.
5. Huawei's flagship mobile phone, the Pura 70 series, went on sale
Huawei announced on the morning of April 18 that the Huawei Pura 70 series pioneer program was officially launched. The Pura 70 Ultra and Pura 70 Pro go on sale at 10:08 a.m. From the pricing point of view, the price of the Pura 70 mobile phone starts at 5499 yuan, the price of Pura 70 Pro starts at 6499 yuan, the price of Pura 70 Pro+ starts at 7999, and the price of Pura 70 Ultra starts at 9999 yuan. The Pura 70 series is equipped with HarmonyOS 4.2, the Pura70 Ultra is equipped with a super-focused telescopic camera, and the Pura 70 Pro+ and Ultra versions support both satellite calls and Beidou image messaging. This is also the second time that after last year's Mate 60 series, Huawei terminals have launched flagship models without holding a press conference.
Related: Huawei officially announced on April 15 that the P series mobile phones will be upgraded to Pura, starting again with a new attitude. Yu Chengdong, Executive Director of Huawei, CEO of Device BG, and Chairman of Intelligent Vehicle Solution BU, said that the development history of the P series is the history of the development of mobile imaging and the evolution of technological aesthetics. Since then, the P-Series has been officially renamed the Pura Collection.
6
Fujifilm Konica Minolta integrates its business
Japan's Fujifilm Holdings and Konica Minolta announced on April 15 that they will start discussions on business cooperation for office equipment such as multi-function PCs and printers. Discussions will be held on the integration of parts procurement departments for office equipment. First of all, we will discuss the establishment of a joint venture between Fujifilm Business Innovation (formerly Fuji Xerox), a subsidiary of Fujifilm, and Konica Minolta, by September. The new company will have the ability to procure parts for office equipment from all over the world. Fujifilm Business Innovation will hold a majority stake in the new company. Related: Fujifilm transforms its business portfolio into a growth area through the expansion of bio-CDMO and medical devices.
7
Honda has strengthened cooperation with major Chinese companies such as Huawei
Honda will strengthen its cooperation with major Chinese IT companies such as Huawei, and will launch all-electric models with improved comfort by the end of the year. Honda's new brand "Ye series" will use a newly developed platform dedicated to pure electric vehicles, and adopt technologies from Huawei, a Chinese communications equipment company, CATL, the world's largest on-board battery company, and iFLYTEK, a major voice recognition company. Masayuki Igarashi, General Manager of Honda's China Headquarters, said, "[We] have given the highest priority to Chinese customers, gathered the technology and resources of China, which is the fastest growing country in the world, and integrated Honda's accumulated technology at a high level."
Related: Major Honda parts companies will put into practical use the technology to manufacture electric vehicles (EVs) at low cost. The company will collaborate with ArcelorMittal Europe to reduce the number of parts by using low-cost steel to achieve integrated molding of body parts. Compared with the production method using aluminum introduced by Chinese companies, the cost of the car body can be reduced by up to 2%. Toyota and Nissan are also stepping up efforts to adjust their production methods. This is to counter Chinese companies that are on the offensive with low-cost cars. Toyota will also start selling its next-generation EVs in 2026 with its own one-piece molding. Nissan will introduce some EV models from FY2027 to reduce the cost of body parts by about 1%.
8
Tesla's layoffs fell below $500 billion in market capitalization
Tesla announced that it has decided to cut more than 10% of its workforce in order to reduce costs, increase productivity and prepare for the next phase of growth. This means that at least 14,000 employees will leave Tesla. Tesla CEO Elon Musk said in an all-hands letter that over the years, Tesla has grown rapidly, setting up multiple factories around the world. At the same time, however, there has been duplication of roles and job functions in certain areas. As companies prepare for the next phase of growth, it is extremely important to reduce costs and increase productivity. Affected by the news of layoffs, Tesla's stock price continued to fall, and its market value fell below $500 billion, closing at $468.3 billion on April 19.
Related: With Tesla's Cybertruck delivery unexpectedly delayed, CEO Elon Musk's management style is under scrutiny. This led a discerning investor to further question his leadership of the company. Rose Gerber, CEO of Gerber Kawasaki Wealth Investment Management, said in an interview: "Since he left Tesla and bought Twitter, basically no one has been running the ship. Earlier this month, Gerber publicly criticized Musk's actions, blaming Tesla's poor sales performance in the first quarter. Musk responded to the comments, expressing his anger at Gerber's allegations. Musk called Gerber an "idiot."
9
LVMH's share of French exports exceeds that of agriculture
The luxury conglomerate LVMH produces more handbags and perfumes than Camembert cheese and wine produced in France's prestigious agricultural sector combined. According to a study conducted for the company by a consulting firm, the Paris-based luxury goods leader accounted for 4% of all French exports last year. Its exports were worth 23.5 billion euros last year, more than the 3.2% contribution of the entire agricultural sector, further highlighting the importance of the luxury sector to France's trade balance.
Related: LVMH reports results for the first quarter of 2024, with revenue down 2% year-on-year to €20.7 billion. Sales in the first quarter saw the weakest growth since the beginning of 2021. By segment, revenue in the Wine & Spirits segment decreased 16% year-over-year, Fashion & Leather Goods revenue decreased 2% year-over-year, Fragrance & Cosmetics revenue increased 3% year-over-year, Watches & Jewelry revenue decreased 5% year-over-year, and Boutique Retail segment revenue increased 5% year-over-year.
10国际纸业收购DS Smith
International Paper said it had agreed to buy British paper and packaging company DS Smith at a valuation of £5.8 billion ($7.20 billion). Upon completion of the merger, DS Smith shareholders will own approximately 33.7% of the combined company, with International Paper shareholders owning the remainder, and the company plans to seek a secondary listing in London. DS Smith said it would advise shareholders to support the deal with International Paper, adding that it had recently received merger proposals from International Paper and Mondy, but that International Paper could now provide a firm offer. RELATED: Mondi pulls out of the bid war against UK packaging rival DS Smith, a move that secures US bidder International Paper's takeover of DS Smith. Mundy said after due diligence it believed the acquisition of DS Smith would be "not in the best interests of its shareholders". Earlier, International Paper said it had agreed to buy British paper and packaging company DS Smith in full shares, but investors have been waiting to see if Mundy will also make a takeover offer.