Technology

Telegram’s route to profitability looks dubious

3 Sep 2024

The troubled app’s CEO Pavel Durov runs a lossmaking enterprise. The easiest path to profitability is to echo Facebook, but content moderation costs would further hit Telegram’s finances. The main alternative is to be a messaging app, but WhatsApp implies that’s hard to monetise.

Murdoch’s UK property gambit has a price ceiling

2 Sep 2024

Australian property listings site REA Group is eyeing $6 bln UK peer Rightmove. The News Corp-backed suitor can use cash and higher-valued shares to pay a 30% premium. Beyond that, Rupert Murdoch’s outfit might struggle to combine a successful bid with keeping him in control.

OpenAI’s mooted $100 bln value is relatively sober

29 Aug 2024

The ChatGPT maker may be worth just 16% more in its next share sale than in February’s funding round, according to reports. That looks modest, given AI darling Nvidia’s shares have nearly doubled. Senior departures and competition from rivals like Elon Musk justify a modest bump.

Carry trade chaos charts outlines of next selloff

28 Aug 2024

BIS researchers reckon cascading margin calls helped turn a local Japanese wobble into a global rout in early August, eventually wiping $1 trln off US tech stocks. It’s a similar story to a March 2020 slump and 2022’s UK bond collapse. Worse, the core drivers remain in place.

New EU antitrust tsar has better tools, harder job

27 Aug 2024

The European Union will soon have a new competition commissioner. Margrethe Vestager’s replacement has greater scope to go after Big Tech and Chinese subsidies. But he or she will also have to defend the single market from the assault of EU members’ national industrial policies.

Alibaba and JD reveal two ways to cope in downturn

16 Aug 2024

China's $190 bln e-commerce group relies on ad sales and is betting on new tech for a turnaround. Its rival sells to shoppers and is focusing on supply chains to boost earnings. The diverging fortunes rest on who spends more: cash-strapped firms or cost-conscious consumers.

Worldline buyout offers rare shot at easy returns

15 Aug 2024

The $2.5 bln French payment firm is an obvious target thanks to its depressed share price. Private equity buyers can wring out a decent return even with zero profit growth in the next few years. And seeing as France is only a minor market, the state is unlikely to meddle.

Apple begins delicate dance with Tencent in China

15 Aug 2024

The iPhone-maker wants a share of revenue from games played on the $450 bln tech giant's WeChat platform. For Apple boss Tim Cook, it's a lucrative opportunity as handset sales cool. Yet if the US company pushes too hard, it may jeopardise its hard-earned appeal in China.

Apple loses China price battle, but will win war

12 Aug 2024

Big discounts by Huawei and other local rivals have eaten into the iPhone maker’s market share. Boss Tim Cook is fighting back, to preserve nearly a fifth of revenue. In a region that often beguiles tech outfits, the $3 trln company’s resilience is impressive – and sustainable.

Taiwan is punching well above its market weight

12 Aug 2024

Share sales and convertible deals are surging on the island where TSMC’s $748 bln market value exceeds GDP thanks to an AI-led rally. The market could surpass China’s weighting in global indices as profits trump geopolitics. For bankers, it's a counterintuitive bright spot.

Google is a monopoly, long live Google

5 Aug 2024

Alphabet’s search giant illegally wields its might over rivals, a US judge has ruled. The decision also carefully stays within classic antitrust boundaries. Given how tricky disentangling the $2 trln company’s technology would be, a market-shaking penalty will be hard to impose.

Philips’ share-price revival is only half finished

29 Jul 2024

The Dutch medical group’s orders are finally growing again, boosting the stock by 10%. Yet Philips is still well below its 2021 peak, before a faulty sleep-aid crisis. Keeping margins high and sales rising may help, but selling the consumer unit may complete the rejuvenation.

UMG pays steep price for platform addiction

25 Jul 2024

The $42 bln music group’s shares sank by more than 25% on Thursday, falling below their 2021 IPO. Lower-than-expected growth in subscription revenues underlines the company’s painful dependence on pricing decisions made by big players like Amazon or Apple.

Ford and GM cushioned by economic safety features

24 Jul 2024

Detroit’s $100 bln automaking duo hit some bumps, but they’re mostly humming along. Even so, delinquent loans and growing inventories have spooked investors about vehicle prices. Bloated dealer profit, ageing cars and lower borrowing costs should smooth out the road ahead.

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.