Technology

Tech poster child poses a problem for Korea Inc

23 Jul 2024

Billionaire Brian Kim’s arrest for his role in a K-Pop deal adds to his Kakao empire's mounting legal woes. Its dominance in messaging also is a regulatory headache. Yet a tough crackdown on the company could jeopardise the country’s new breed of promising global businesses.

Cyber meltdown points to downsides of efficiency

19 Jul 2024

A software update by $83 bln CrowdStrike grounded flights and disrupted financial markets. That’s possible because businesses work with a small number of providers, seeking lower costs. It supports rich tech valuations, but also heightens the risks of a catastrophic failure.

Apple’s India ascent is a salve for China woes

19 Jul 2024

The iPhone-maker’s sales in the South Asian country surged to $8 bln thanks to a luxury boom. That pales next to the $73 bln of revenue from the People’s Republic, but stiff competition and sluggish consumption there are a headache. That makes India increasingly vital for Apple.

China’s EU-made EVs are in pole position – for now

19 Jul 2024

BYD and Chery are planning plants in the European Union; peers will follow. While factors like labour and energy add 25% to the cost of cars made in the bloc, tech and design mean the overall product is cheaper than Western rivals’. But Brussels could yet complicate matters.

Meta stake may blur vision for Ray-Ban maker

18 Jul 2024

The $1.2 trln tech giant may buy 5% of eyewear group EssilorLuxottica. It’s a show of confidence in the companies’ smart glasses partnership. But the investment could complicate the Paris-listed firm’s governance and limit its options for working with rivals like Apple.

Trump lays bare TSMC’s inherent vulnerabilities

17 Jul 2024

The presidential candidate complained Taiwan took America's chip business and is taking subsidies. He wants it to pay for US defence too. For now, the high exposure of the island's $840 bln semiconductor giant to both Washington and Beijing is a dampener on its AI fortunes.

Smaller tech grapples with end of Big Tech put

12 Jul 2024

Software developers are trading at premium valuations, fueled at least in part by the idea that larger rivals will scoop them up. Alphabet’s decision not to buy $25 bln HubSpot, and greater antitrust resistance, indicates such outcomes are less assured. More disappointment looms.

Why AI may fail to unlock the productivity puzzle

4 Jul 2024

The world’s richest economies are grappling with slowing growth in output. Many investors believe artificial intelligence can provide a much-needed boost. But four features of the technology suggest the benefits will be limited – and might even achieve the opposite outcome.

Data centre boom reveals AI hype’s physical limits

4 Jul 2024

The investor frenzy over artificial intelligence assumes there will be enough infrastructure to support apps like ChatGPT. But a $1 trln rush to build data centres faces planning restrictions and energy constraints. That will limit processing power and push up costs for users.

Salesforce signals CEO pay is easy come, easy go

2 Jul 2024

In 2023, the $246 bln software giant’s stock price returned four times the S&P. Year-to-date, it has underperformed. Now shareholders have rejected boss Marc Benioff’s pay plan. A shift in spending to AI is haunting Salesforce. Shareholders get antsy when bosses get complacent.

Nvidia customer’s valuation voodoo tests AI mania

2 Jul 2024

Germany’s $1.4 bln Northern Data has access to the US giant’s sought-after chips and makes money by renting them out. It may re-list parts of the business on the Nasdaq. If investors accept a mooted $10-16 bln price tag, it’s a sign the market has truly lost touch with reality.

Larry Fink makes racy salvo in private markets war

1 Jul 2024

BlackRock will buy UK buyout fund data provider Preqin for $3.2 bln, muscling aside rivals like S&P. It’s a rich price that will take years to pay off. While CEO Fink has a history of savvy deals, higher rates and acute competition in alternative assets both raise the stakes.

The economics of AI points to value of good data

28 Jun 2024

Investors chasing the artificial intelligence boom have pushed up the value of $3 trln chip supplier Nvidia and big cloud computing firms. Yet AI models have dubious benefits unless they are trained on reliable information. Moreover, high-value data makes them cheaper to develop.

Ola sets a mileage test for India’s EV market

27 Jun 2024

Investors are resisting the electric scooter maker's mooted IPO price-tag. At $7 bln, it's 30% higher than the SoftBank-backed company's last fundraise. Bhavish Aggarwal's startup has an early-mover advantage and deserves a premium valuation but peers are catching up fast

Olympic Games can withstand Atos farce

26 Jun 2024

The French firm managing the Paris sporting event’s IT backbone is close to bankruptcy. It may find 800 mln euros of short-term financing from President Macron’s government and loans even after creditors ditched restructuring talks. But its future after the Games is less certain.

Revolut’s desired $40 bln price tag is a stretch

24 Jun 2024

The UK fintech group wants to sell $500 mln of shares at a valuation far above its last level. To get to $40 bln, investors need to assume it’s like payment giant Adyen. With a lower margin and discounts warranted in other areas, Revolut’s value looks more like $20 bln.

A warning from history about large-cap stock booms

21 Jun 2024

Five decades ago, shares in a handful of large companies like IBM and McDonald’s propelled the US stock market to new highs before collapsing. As investors pile into tech giants led by $3.3 trln Nvidia, the earlier period may be instructive for those who believe history rhymes.

Tiny Singapore’s chip hub retains a big punch

21 Jun 2024

NXP and Vanguard's new $8 bln factory in the country follows recent investments from GlobalFoundries and others. Singapore has an impressive edge in the semiconductor industry despite high costs and a shortage of space. Its neighbour Malaysia will soon test that advantage.

AI inverts tech’s growth and value buckets

14 Jun 2024

As the software boom’s easy growth fades, once-racy giants like Salesforce - and their valuations - look stodgier. Yet aged rival Oracle added $45 bln in market value on artificial intelligence-driven growth. The latest mania is flipping tech investors’ taste for new over old.

Apple aims to be tech’s AI sniper

10 Jun 2024

The $3 trln giant is making its assistant Siri more effective, stitching together and using personal information on users’ phones. Partnering with OpenAI is a smart hedge on its relationship with Alphabet too. Success depends on patience and picking the right targets.