|Bid||49,900.00 x 0|
|Ask||49,950.00 x 0|
|Day's Range||48,800.00 - 50,000.00|
|52 Week Range||41,300.00 - 62,800.00|
|Beta (5Y Monthly)||0.95|
|PE Ratio (TTM)||N/A|
|Earnings Date||Jul 29, 2020 - Aug 04, 2020|
|Forward Dividend & Yield||1,416.00 (2.90%)|
|Ex-Dividend Date||Mar 30, 2020|
|1y Target Est||54,903.00|
(Bloomberg) -- Arm Ltd., whose technology is a key component of chips that run most of the world’s smartphones, is offering new designs aimed at boosting the performance of Android handsets.The U.K. company said its new A78 model will offer a 20% increase in performance over its predecessor and announced a new Cortex-X program that will help chipmakers customize their offerings to deliver bursts of as much as 30% more processing speed.Arm offers chip designs and licenses the fundamental code used by processors to communicate with software that runs phones. Most Android phone makers use chips from Qualcomm Inc. or Mediatek Inc. Samsung Electronics Co. and Huawei Technologies Co. use those chipmakers’ components and their own products. Apple Inc. is an Arm licensee, but designs its own A series processors that are typically rated the speediest available.The customization that Apple has been able to bring to its own combinations of software and hardware has allowed it to claim performance leadership over phones that run Alphabet Inc.’s Google Android operating system. Such claims feature heavily in Apple’s marketing of the iPhone.“The pace of increasing performance in smartphones exceeds that of any other computing device category in the industry today,” Arm said in a statement. “To address this insatiable demand for the highest performance possible, we’re introducing a new engagement program called the Cortex-X Custom program to give our partners the option of having more flexibility and scalability for increasing performance.”Cortex X will let chip and phone makers add a different mix of cores to the combinations of components that run major smartphone functions. Current designs feature uniform sets of cores and more power-efficient ones that are used to maintain background functions without draining the battery. Arm’s new offering changes this approach. An X core might kick in for a short time, for example, when a piece of software is demanding the absolute maximum performance the chip can provide.Cambridge-based Arm is a division of Japan’s SoftBank Group Corp. Like other companies that rely on the smartphone market, Arm is looking for ways to help spur demand for the devices. The market already had stalled before the Covid-19 outbreak curbed sales and disrupted supply chains. In the first quarter of 2020, smartphone shipments dropped 12% from a year earlier, according to IDC.In addition to more powerful and efficient designs for the handsets, the smartphone industry is banking on faster fifth-generation, or 5G, networks to persuade consumers to upgrade their phones.Arm is also offering a new graphics chip design that will handle video and gaming content better, and updated machine-learning capabilities to help with artificial intelligence workloads.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- South Korean prosecutors have summoned Samsung Electronics Co. Vice Chairman Jay Y. Lee for questioning in an ongoing investigation into alleged accounting fraud and a controversial 2015 merger of two Samsung affiliates, dealing another legal blow to the country’s largest corporation.While expected, the decision marked a deepening of a long-running probe into the billionaire scion and his shipbuilding-to-smartphones Samsung Group conglomerate. The company’s de-facto leader was called into Seoul Central District Prosecutors Office at 8 a.m. local time Tuesday in relation to allegations over illegal acts in succession plans, the Yonhap News Agency reported. The summons came after the executive publicly apologized over his company’s role in scandals over his succession, which eventually led to the impeachment of former president Park Geun-hye. A spokesman at the agency confirmed Lee has been summoned, without elaborating.Lee has been at the center of a years-long scandal and graft trial that inflamed long-standing resentments against Korea’s most influential family-run conglomerates. He faces renewed charges of using gifts of expensive horses to win favor from the previous administration, which he has denied. The legal fight has disrupted his tenure at the helm of Samsung Electronics, the world’s leading producer of smartphones and memory chips. This month, the billionaire took the unusual step of apologizing for his role in the controversy, pledging his children would never run the conglomerate.“I give my word here today that from now on, there will be no more controversy regarding succession. There will absolutely be no infringement against the law,” Lee said at a hastily convened press conference at the time. “There will be no leaning on legal expediency or actions that cause ethical reproach. My sole focus will be on enhancing the corporate value of Samsung.”Read more: Samsung Heir Vows an End to Family Rule After Succession ScandalThe prosecutors office’s probe, which is separate from the corruption trial, centers on whether there were illegal acts during a merger between Samsung C&T Corp. and Cheil Industries -- the conglomerate’s de-facto holding company. That deal was regarded as an effort to cement Lee’s control over the conglomerate, which he has run since his father suffered a heart attack in 2014. Prosecutors are also likely to interrogate the heir about allegations of financial fraud at Samsung Biologics Co. The agency hasn’t brought any charges in the case so far. A Samsung Electronics spokeswoman declined to comment on Tuesday.Read more: The Never-Ending Trial Between a Billionaire Heir and His NationSamsung Group, South Korea’s largest conglomerate with more than $400 billion of market value, has grappled with legal issues for years. Dozens of current and former executives have been questioned, indicted or arrested over charges that range from graft and accounting issues to union-busting. Lee was imprisoned for about a year until his release in early 2018, then returned to court for a retrial last year when the scope of the alleged wrongdoing was revised. He again faces the possibility of jail.The current prosecutors’ probe kicked off after the country’s Financial Services Commission in 2018 said Samsung’s biotechnology unit “intentionally” violated accounting rules surrounding an initial public offering. The regulator said at the time the unit deliberately overstated the value of Samsung Bioepis Co. ahead of its 2016 IPO. Critics argued that Samsung Group orchestrated the accounting change to benefit the merger of Samsung C&T and Cheil Industries, which made Lee the largest shareholder at Samsung’s de-facto holding company and bolstered his succession plans.Samsung Biologics has denied the allegations and said its books were examined by external accounting firms, and that it had no impact on the 2015 merger as that was completed before the bio firm’s accounting change.(Updates with Samsung’s response in the fifth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- The list of Intel Corp.’s annual supplier award winners tends to read like a who’s-who of the semiconductor industry’s biggest names. This year, it included a little-known Japanese company whose machines have become indispensable in the race to improve semiconductors and whose stock has been rocketing up as a result.Lasertec Corp. is the world’s only maker of testing machines required to verify chip designs for the nascent extreme ultraviolet lithography (or EUV) method of chipmaking. In 2017, Lasertec solved a key piece of the EUV puzzle when it created a machine that can inspect blank EUV masks for internal flaws. Last September, it cleared another milestone by unveiling equipment that can do the same for stencils with chip designs already printed on them. This March, Intel gave the tiny Yokohama-based company an award for innovation, its first after decades of doing business together.“That’s a major milestone for us,” Lasertec President Osamu Okabayashi said in an interview. “It means a lot to be recognized this way as a supplier.”The company’s stock has soared about 550% since the start of 2019, more than twice the gain of the second-best-performing security in the benchmark Topix index. Shares increased about 4% Tuesday, pushing its rise this year to more than 60%.Intel declined to say if it was buying EUV equipment from Lasertec, which already supplies test gear to its rivals Samsung Electronics Co. and Taiwan Semiconductor Manufacturing Co. The three chip fabricators are the only ones so far to announce EUV plans, because the technology is so complex and expensive. Okabayashi would only say that his company has “two or more” EUV customers.“This can be read as a sign that Lasertec’s tools are indispensable to Intel’s EUV roadmap.” said Damian Thong, an analyst at Macquarie Group Ltd.Read more: Japan’s Star Electronics Stock Will Be Vital to Intel, SamsungEUV is just entering the mass production phase after two decades in development, but investors are already betting Lasertec will be one of the key beneficiaries. The move to EUV overcomes key hurdles to shrinking manufacturing geometries of semiconductors, allowing more and smaller transistors to be crammed onto silicon. It promises to unleash another wave of gadgets that are slimmer, cheaper and more powerful.Last month, Lasertec raised its annual order forecast for the second time this year to 85 billion yen ($789 million) in the period ending June, nearly double the amount it received in fiscal 2019. The company is headed for the fourth straight year of record revenue and profits. Sales will climb 39% to 40 billion yen and profit will jump 76%, according to its estimates. And that’s likely to be just the beginning.Samsung earlier this month said it is building a 5-nanometer fabrication facility that will use EUV to make processors for applications ranging from 5G networking to high-performance computing from the second half of next year. Taiwan’s TSMC is pushing ahead with plans to adopt 3-nanometer lithography mass production in 2022 and announced plans to build an advanced fab in the U.S. Intel’s first product made using EUV is expected late next year.Their primary focus is on so-called logic processors, used to power devices and networking applications, but the new manufacturing technique will eventually filter through into the production of DRAM and other memory chips.Read more: Samsung Takes Another Step in $116 Billion Plan to Take on TSMC“Logic makers will be first to adopt EUV, with memory makers following later,” Okabayashi said. “The real volume of orders will come when they reach mass production stage. Right now it’s 7- and 5-nanometer chips. 3-nanometer is still in development stage.”Okabayashi expects each customer will probably need several of his testers, which could cost well over $40 million apiece and take as long as two years to build. A chipmaker would need at least one machine in its mask shop to make sure the stencils come out right. Another would go into a wafer fab to keep an eye on the microscopic wear and tear that result from concentrated light being projected repeatedly through the chip design stencils.“Lasertec is still trying to get a feel for this market and how big it can be,” Macquarie’s Thong said. “Their stock is moving on expectation of future orders. But there is little actual visibility on the scale of this market, so Lasertec retains a lot of capacity for surprise.”(Updates with share price in fourth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Samsung Group heir Jay Y. Lee was questioned on Tuesday by prosecutors about a controversial 2015 merger and alleged accounting fraud that they said may have helped him advance his succession-planning agenda at the country's top conglomerate. The questioning brings fresh legal trouble for Lee who is already facing court trial over a charge of bribery aimed at winning support to succeed ailing group patriarch Lee Kun-hee, and which involved former South Korean President Park Geun-hye. Prosecutors have been investigating suspected accounting fraud at drug company Samsung Biologics after the Korean financial watchdog complained the firm’s value had been inflated by 4.5 trillion won ($3.64 billion) in 2015.
Samsung Electronics will forge ahead with billions of dollars of new investments in computer chip production despite uncertainties caused by the coronavirus pandemic and political tensions between its key US and China markets. The South Korean technology group on Thursday announced construction of an $8bn production line in its home country, which will produce the high-end processor chips used across 5G, artificial intelligence and high-performance computing. The investments come despite concerns over demand for technology products, as the global economy is battered by crippling lockdowns and job losses caused by the health crisis.
South Korea's Samsung Electronics Co Ltd on Thursday said it has broken ground for its sixth domestic contract chip production line, which will make logic chips as part of efforts to reduce its reliance on the volatile memory chip sector. Samsung is taking on bigger rival Taiwan Semiconductor Manufacturing Co Ltd (TSMC) in the contract manufacturing business, where it competes to win orders from customers such as Qualcomm Inc. Samsung broke ground earlier this month and plans to start production in the second half of next year.
Shares of South Korea's SK Hynix <000660.KS>, the world's No.2 memory chip maker and supplier to Huawei [HWT.UL], fell as much as 3.3% early on Monday after a U.S. move to curb semiconductor supplies to the Chinese company stoked fears about a demand hit. The U.S. Commerce Department said on Friday that foreign companies that use U.S. chipmaking technology will be required to obtain a U.S. license before supplying certain chips to Huawei, a maker of smartphones and telecoms equipment. The rules specifically target chips designed by Huawei and its affiliates, including chip-design unit HiSilicon and manufactured using U.S. technology.
(Bloomberg) -- Taiwan Semiconductor Manufacturing Co. plans to spend $12 billion building a chip plant in Arizona, a decision designed to allay U.S. national security concerns and shift more high-tech manufacturing to America.TSMC said Friday it will start construction of its next major fabrication facility in 2021, to be completed by 2024. While the investment falls short of its previous expenditure on cutting-edge factories, it’s a shift for a company that now makes semiconductors for major names like Apple Inc. and Huawei Technologies Co. mainly from its home base of Taiwan.As the world’s largest and most advanced maker of chips for other companies, TSMC plays a crucial role in the production of devices from smartphones and laptops to servers running the internet. Its decision to situate a plant in the western state comes after White House officials had warned repeatedly about the threat inherent in having much of the world’s electronics made outside of the U.S. TSMC had negotiated the deal with the administration to create American jobs and produce sensitive components domestically for national security reasons, according to people familiar with the situation.The Asian chipmaker’s U.S. investment underscores the delicate balance it needs to strike between its huge roster of American clients and China, which views independently governed Taiwan as part of its territory. Beijing’s ambition of creating a world-class domestic semiconductor industry has unnerved Washington, which fears the country’s technological ascendancy may pose a longer-threat. Executives at TSMC, which operates plants in Nanjing and Shanghai and makes chips that go into everything from 5G networks to American fighter jets, have emphasized the company is neutral.“The scale & technology is similar to what TSMC did in China, suggesting a balance between the U.S. & China,” Sanford C. Bernstein & Co. analysts led by Mark Li wrote after the announcement. “Overall, this is probably the minimal price to stay neutral. TSMC needs both U.S. & China to maintain scale & stay competitive and this is probably the minimal cost to keep this strategy.”Read more: Huawei Warns of ‘Pandora’s Box’ If U.S. Curbs Taiwan SupplyThe envisioned facility represents a small step in global industry terms. Upon completion, it will crank out 20,000 wafers a month, versus the hundreds of thousands that TSMC’s capable of from its main home base. And it will employ 5-nanometer process technology, a current standard that will likely become a few generations old by the time output begins in a few years.The higher cost of operating in America may have been a factor ahead of the decision. A true cutting-edge fab is expensive to build: The company spent NT$500 billion ($17 billion) to build an advanced facility in the southern Taiwanese city of Tainan that will supply new iPhones this year. It plans another $16 billion in capital spending in 2020. The Arizona plant still requires approval from TSMC’s board, which may hinge on incentives.“There is a cost gap, which is hard to accept at this point. Of course, we have -- we are doing a lot of things to reduce that cost gap,” TSMC Chairman Mark Liu said on a recent analyst conference call.U.S. Won’t Tolerate Tech Fence-Sitters Any Longer: Tim CulpanIf the federal government provides cash for a U.S. plant, it’ll mark a shift in policy and rhetoric from a Republican administration. Trump’s White House has rarely supported such direct industrial intervention, favoring market dynamics. A similar government-backed effort with Foxconn -- Apple’s main iPhone assembler -- in Wisconsin has so far not created as many jobs as expected.However, emerging trends may be forcing a reconsideration. The U.S. government is already giving or lending billions of dollars to keep companies afloat in the midst of a pandemic-fueled recession. The crisis has also highlighted how vulnerable global supply chains are to such shocks.The White House may also be motivated by broader political factors. Trump has attacked international trade deals and tried to limit China’s access to semiconductor technology, seeking to contain the country’s technological ascent. TSMC said its Arizona facility will create 1,600 jobs and a deal to bring highly skilled work to Arizona may help Trump’s re-election prospects this year.“TSMC’s plan to build a $12 billion semiconductor facility in Arizona is yet another indication that President Trump’s policy agenda has led to a renaissance in American manufacturing and made the United States the most attractive place in the world to invest,” U.S. Secretary of Commerce Wilbur Ross said in a statement.By producing chips for many of the leading tech companies, TSMC has amassed the technical know-how needed to churn out the smallest, most efficient and powerful semiconductors in the highest volumes. It manufactures important components designed by Apple and most of the largest semiconductor companies, including Qualcomm Inc., Nvidia Corp., Advanced Micro Devices Inc. and China’s Huawei. Shares of Applied Materials Inc., Lam Research Corp. and KLA Corp. rose on optimism that these U.S.-based providers of chipmaking equipment may face fewer export controls when supplying TSMC.Concentrating such valuable capabilities in the hands of one company in Asia is a concern for the U.S., especially when, across the Strait of Taiwan, China is rushing to develop its own semiconductor industry.TSMC’s local rival, GlobalFoundries Inc., has given up on advanced manufacturing and Intel Corp., the world’s largest chipmaker, mainly manufactures for itself. Its attempt to become a so-called foundry for external clients has failed to gain major customers. TSMC’s only other significant challenger is South Korea’s Samsung Electronics Co., which is investing more than $116 billion in its effort to keep up with the leader.“TSMC welcomes continued strong partnership with the U.S. administration and the State of Arizona on this project,” the company said in a statement. “This project will require significant capital and technology investments from TSMC. The strong investment climate in the United States, and its talented workforce make this and future investments in the U.S. attractive to TSMC.”Read more: Foxconn Factory Subsidy Estimate Slashed by Wisconsin Agency(Updates with analyst’s comment from the fourth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- U.S. technology stocks are on their hottest winning streak of the year, yet those gains aren’t necessarily translating to the same boost for their peers in Asia.The tech benchmark Nasdaq 100 Index, heavily skewed toward the so-called FAANG stocks -- Facebook Inc., Apple Inc., Amazon.com Inc., Netflix Inc., Google parent Alphabet Inc. -- as well as top position Microsoft Corp., has now rallied for six straight days. It has rebounded 33% since a low in March as investors piled into technology and biotech shares seen as winners amid the social-distancing lockdowns of the coronavirus pandemic.Read: Nasdaq’s Resilience Pushes Benchmark Dominance to 20-Year HighThere’s no equivalent tech mainboard in Asia, with the MSCI Asia Pacific Information Technology Index the closest comparable. It’s up a comparatively weak 24% since mid-March, and the top stocks in the gauge, Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co., have lagged that gain. Tencent Holdings Ltd., the online gaming and social-media services giant that analysts expect will report Wednesday an 18% revenue increase amid the virus outbreak, isn’t part of that index.While the top of the Nasdaq 100 enjoys a more diverse mix -- Google, Netflix and Facebook leveraging demand for online and social-media services from consumers stuck at home, alongside Amazon’s online delivery -- the Asia Pacific index is largely dominated by chipmakers TSMC and Samsung. They account for more than a third of the gauge.The coronavirus pandemic has been a net negative for chipmaker stocks worldwide. Despite growth in data centers, they’ve been hit by concerns about lower end-market demand for new personal computers, smartphones and autos, Bloomberg Intelligence analysts Anand Srinivasan and Marina Girgis wrote in a May 1 note.Tencent not being part of the Asia Pacific tech index is also hurting it. After falling less than its peers during the initial market downturn, the stock is up 14% for the year, climbing to a two-year high on Monday.Global mobile game sales hit a record for the week ended May 3, according to Sensor Tower, with holidays in China and Japan also helping gains, BI’s Matthew Kanterman and Vey-Sern Ling wrote in a note Monday. “Growth should continue above the long-term market potential for the duration of the pandemic, likely through 2Q,” they said.Tencent was also included as a “select stock pick” as internet, health-care and property sectors are among those to benefit from China’s upcoming National People’s Congress, Citigroup Inc. analysts including Pierre Lau wrote in a May 11 note.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg Opinion) -- Ever since Donald Trump fired the first shot in the U.S. trade war with China, one technology company has been sitting in the middle, trying to avoid the crossfire. It’s wonderful to be able to sell weapons to all sides, until one forces you to choose.Taiwan Semiconductor Manufacturing Co. is in the enviable position of being a critical supplier to both countries. The company, headquartered in famed Hsinchu Science Park, makes the world’s most advanced chips for the likes of Apple Inc., Qualcomm Inc., Nvidia Corp. and Huawei Technologies Co. The U.S. fear, as portrayed by the White House, Pentagon and Commerce Department, is that allowing China to procure the world’s best semiconductors while America is unable to make them at home is an urgent and critical national security threat. That’s spurred a two-pronged strategy in recent years: Limit Chinese access to and development of chip technology, and bolster domestic prowess.TSMC’s strategy has been to stay neutral. It has most of its capacity in Taiwan, one new and one not-so-new factory in China, and an old facility in Washington state. A year ago, I wrote that chairman Mark Liu had politely pushed back against pressure to expand in America, citing the steep costs. I concluded: “TSMC won’t be able to sit on the fence forever. While Liu may want to just make chips, he’ll eventually have to make a choice.”That day has come. The coronavirus pandemic has highlighted Washington’s need to protect supply chains from disruption, and heightened concerns about reliance on Taiwan, as the Wall Street Journal reported over the weekend. To that end, the administration is pushing hard to get chipmakers, including Intel Corp., TSMC and Samsung Electronics Co., to expand in the U.S., and to use their best technology, the WSJ wrote.Unsurprisingly, Intel is making the case that the U.S. should strengthen its domestic production for “geopolitical” reasons. The company has most of its staff, and more than half its plants and equipment, in the U.S., including manufacturing in Arizona, New Mexico and Oregon.While best-known for supplying processors used in PCs and servers under its own name, Intel also operates a foundry business that does contract manufacturing using clients’ own designs. Once the world leader in chip production, the Santa Clara, California-based company has fallen behind and now trails TSMC and South Korea’s Samsung.Intel clearly sees an opportunity. If it can convince defense and commerce officials that it’s in the interest of national security to mandate that at least some chips be made domestically, then it may have a shot at getting back into the foundry game. TSMC has been trying to push back, or at least to get a seat in the policy discussions. It recently hired former Intel lobbyist Peter Cleveland to coordinate its efforts in Washington. As the old saying goes, “If you’re not at the table, then you’re on the menu.”But the other aspect of American strategy may be harder for the Taiwanese company to negotiate. Beyond expanding domestic capacity, Washington wants to limit Chinese access. To do so, the Trump administration is considering new rules to curb the use of U.S. equipment and materials in making chips for the likes of Huawei, arguing that the Chinese company is a conduit for Beijing’s espionage.That’s put TSMC and numerous other companies in a difficult position. The American market accounted for 59% of its sales last year, against 19% for Chinese clients. Yet the growth momentum clearly favors the world’s largest country, which is focused on developing components used in artificial intelligence, 5G communications, surveillance and possibly weaponry. TSMC has attempted to play Switzerland. A year ago, the company was sticking with the line that “We are everybody’s foundry.”Washington increasingly wants TSMC to be its foundry alone. Pressure has ramped up significantly over the past year, with the long list of U.S. clients and significant revenue contribution being used as a battering ram to make the point that America is the side to choose. Ten years ago, when Taipei-Beijing relations were friendlier, companies may have leaned toward China. Today, with China showing increasing belligerence and the U.S. supporting a greater global voice for Taiwan, the mood has shifted.It’s true that China is an important and growing market — Beijing has used that momentum to bring global companies to its shores — yet it won’t replace the U.S. in terms of size or technology leadership in the next 20 years. To assuage concerns, and win a reprieve on restrictions about supplying to China, TSMC has little choice but to offer something to the Americans. After years of delay and resistance, it’s time for TSMC to build a shiny new factory in America. Expect to hear the company announce concrete plans, and large dollar figures for U.S. investment, in the next year or so.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Tim Culpan is a Bloomberg Opinion columnist covering technology. He previously covered technology for Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Regulators are moving to let U.S. companies participate in technology standards-setting bodies alongside Huawei Technologies Co., despite the Chinese firm being blacklisted in the U.S. over security concerns.The Commerce Department is writing a regulation to make clear that restrictions on dealing with Huawei don’t bar involvement in international processes in which the Shenzhen-based maker of telecommunications equipment also is taking part, said two people briefed on the matter.The rule could be released within days for a review by other agencies and may not be final for some time, said the people who asked not to be identified because the change hasn’t been made public.The Commerce Department declined to comment.The Trump administration last year said it would cut off Huawei’s access to crucial American components, and has waged a campaign to get allies to shun the company’s telecom equipment because it is a security risk. Huawei has denied it is a security risk.Standards-setting bodies designate technology to be used widely in manufacturing, for instance ensuring that photos from a Samsung Galaxy phone can be viewed on an Apple iPhone.Tech advocates have said shifting rules have led U.S. companies to shun some standards-setting forums.“Confusing and unclear U.S. policies have inadvertently caused many U.S. companies to lose their seat at the table to competitors from other countries, namely China,” said Naomi Wilson, senior director of policy for the Information Technology Industry Council, a policy group that includes Qualcomm Inc. and Intel Corp. as members. “It is critical that the U.S. Department of Commerce address these ambiguities.”Doug Brake, telecom policy director for the Information Technology and Innovation Foundation, said U.S. companies’ participation “is crucial to making sure American technology is incorporated in basic technology around the world.”Six U.S. senators in an April 14 letter raised the issue, saying they were concerned about “risks to the U.S. global leadership position in 5G wireless technology.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Samsung Group heir Jay Y. Lee's vow to end dynastic succession at South Korea's biggest conglomerate following three generations of Lee family control sparked skepticism on Thursday. "If he really wants to sever the family control of the group, he has to announce how he will offload stocks in Samsung's de facto holding company, Samsung C&T, as Bill Gates sold his stake in Microsoft," Kim Woo-chan, a professor of finance at Korea University Business School, said.
Samsung Group heir Jay Y. Lee, embroiled in a bribery scandal, on Wednesday made a rare apology over controversial succession plans and said he will not hand over management rights to his children at the family-controlled conglomerate. Lee's remarks come after Samsung Group's oversight panel in March advised him to apologise over the handling of succession, labour and others issues, and pledge to prevent any repeat of governance violations.
(Bloomberg) -- The manager of a $500 million oil exchange-traded fund said its broker refused to let it increase holdings of crude futures, a sign of continued risk aversion in global oil markets after last month’s historic plunge below zero.As a result of the broker’s ultimatum, the Samsung S&P GSCI Crude Oil ER Futures ETF will halt issuance of new shares starting Monday. The Hong Kong-traded fund also bought put options to protect against negative oil prices and will adjust its existing futures positions, moving from a 100% weighting in September West Texas Intermediate contracts to an equal weighting in September, October and December.Samsung Asset Management (Hong Kong) Ltd., which disclosed the moves in a filing to the Hong Kong stock exchange, said it’s in “active discussions” to find a new broker. It didn’t disclose the name of the existing one.Unprecedented oil-market volatility has wreaked havoc on ETFs and other products designed to give investors an easy way to bet on the direction of crude prices. The Samsung ETF and the $3.5 billion U.S. Oil Fund, which trades in New York, are among those that have upended their strategies to reduce the risk of getting wiped out by another plunge below zero.While the moves may help protect existing investors, they’ve introduced new layers of complexity and may cause the funds to diverge from their original goal of simply tracking front-month oil futures.The Samsung ETF’s announcement will likely be closely watched by oil traders given its moves can impact prices. The fund contributed to a sell-off in June WTI futures last month after dumping its entire holdings to buy September contracts.WTI June futures fell 6% in early trading on Monday, while September contracts dropped 3%.In its filing on Sunday, Samsung Asset said the latest changes are “in good faith and in the best interests of the unit holders” but have made it “impracticable” to meet the fund’s original investment objective. It repeated a warning that in a “worst case scenario,” investors could lose all their money.Here are some further details from the filing:The fund will start adjusting its futures positions after the market close in Hong Kong on May 4 and the process will take “at most” five trading days, subject to market conditions.On May 1, the fund purchased 6,750 put options on September WTI futures. Samsung Asset said failure to do so would have potentially caused the fund’s broker to liquidate some or all of the fund’s futures positions “without giving the manager sufficient time to make any alternative arrangements.”Investors should “exercise caution” because the fund may trade at a larger premium or discount as a result of the suspension of new issuance.Samsung Asset expects that secondary market trading in the ETF and the redemption of units will continue.(Updates with Monday oil prices in seventh paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Samsung Electronics and Apple Inc will retain their first and third spots on the leaderboard, but are both expected to lose market share to Chinese rivals, the market research firm said on Thursday. TrendForce cut its annual output forecast to 1.24 billion smartphones, down 11.3% from 2019, from 1.35 billion. "The pandemic is now making its effects felt on the demand side of the smartphone market by tanking major economies worldwide," TrendForce said.
Arm Inc, the British firm whose chip technologies power most smart phones, said on Wednesday it was easing fees for startup companies and providing free offerings to an incubator for early-stage chip firms. Arm, owned by Japan’s Softbank Group Corp, licenses its intellectual property to companies like Qualcomm Inc , Apple Inc and Samsung Electronics Co Ltd , which in turn use the technology in their respective chips for smartphones and other devices. Arm charges a range of licensing fees to access its technology, including some that must be paid for potentially several years of design and development time before a company ever sees its first physical chip.
When the coronavirus outbreak in China disrupted global smartphone production in February, Samsung looked set to weather the crisis better than most thanks to its limited exposure there and launches of pricey 5G phones. The world's biggest smartphone vendor, Samsung Electronics Co in full, warned on Wednesday of a significant drop in mobile earnings in the second quarter, as recession fears dampen demand for high-end models and carriers in major markets delay the rollouts of fast 5G networks.
Samsung Electronics is warning of a plunge in profit as sales of smartphones, gadgets and TVs take a dive. The company said Wednesday (April 29) it expects that slump in the current quarter even though its business making chips for computers and servers is soaring. That's thanks to a surge in demand as people are ordered to work from home. Samsung posted operating profit at 3% from January to March on Wednesday. But that reflects a time before the current crisis went global and a hunger for chips right now may not be enough to avoid a hit to its Q2 profits. Streaming services, online shopping as well as cloud applications tied to remote working and online education have meant a rise in demand from data centers for Samsung's chips. But in Wednesday statements Samsung joined other tech giants in warning of uncertainty over how the industry may suffer for the rest of the year. Consumers wary of a slowdown are putting off purchases of non-essential electronics like Samsung's popular smartphones and televisions. That's depsite Samsung launching a new lineup of phones in February. The company warned as stores remain shut and the market shrinks it sees handset demand only falling further.
(Bloomberg) -- Samsung Electronics Co. warned earnings may decline this quarter after the coronavirus outbreak hurt demand globally for smartphones and gadgets, wiping out gains from a surge in online activity by people sheltering at home.South Korea’s largest company reported a 4% slide in net income to 4.9 trillion won ($4 billion) in the three months ended March. Samsung, which had reported better-than-expected operating profits earlier this month, said the pandemic continued to hammer demand across an array of markets.The warning from the world’s largest maker of memory chips, smartphones and consumer appliances underscores the uncertainty gripping global industry. As the pandemic spread in the first months of the year, the technology sector took hits from both supply and demand. Samsung joins peers such as Intel Corp. in cautioning about the impact of a global economic slowdown.“Covid-19 has created unprecedented challenges for the global community. At this point, it is impossible to determine how big of an impact it will have or how long it will affect our society and economy, leading to a period of extremely heightened uncertainty,” Ben Suh, executive vice president, said on an earnings call. “Considering heightened Covid-19 related uncertainties especially in the second half, we will not be providing any annual guidance at this time.”Read more: Intel Withdraws 2020 Forecast on ‘Significant’ UncertaintyThe Korean conglomerate said overall earnings are likely to decline from the previous quarter because of the hit to several core products. In particular, Samsung said a drop in smartphone earnings is “inevitable” in the second quarter because of store closings and other factors, while profits would also slip in mobile displays. Executives on a post-earnings conference call refrained from offering full-year guidance on the memory market but said the company will continue to invest in semiconductor expansions and research.The Covid-19 pandemic has emerged as one of the largest economic shocks in recent years, disrupting both consumer demand as well as supply chains worldwide. Factories in countries such as China were temporarily shut, crimping orders for Samsung components like displays. Meanwhile, retail stores, including those of client Apple Inc., were closed to avoid spreading infections. That’s been offset in part by demand for the memory chips used in datacenters and computers, which allow people to work and study from home. Samsung’s shares stood largely unchanged Wednesday.Samsung Needs You to Stay Home and Watch Netflix: Tim CulpanWhat Bloomberg Intelligence SaysSamsung Electronics’ downbeat 2Q profit guidance reflects its smartphone-shipment plunge amid the Covid-19 outbreak. In contrast to a sequential as well as year-on-year increase, according to Bloomberg consensus, Samsung expects 2Q earnings may decline. We expect its memory chip profit will stay sturdy in 2Q since most contracts should have been concluded with customers.\- Anthea Lai, analystClick here for the research.Should the pandemic persist into the second half, the tech giant foresees missing its own 2020 revenue projections by a double-digit percentage, Bloomberg News has reported. A prolonged virus outbreak may also disrupt its supply chain. Delays in marquee events such as the Olympics will prompt changes in marketing plans for TVs, a big revenue generator. A prolonged outbreak could also slow the international rollout of ultra-fast fifth-generation wireless technology, hurting everything from phones to Samsung’s own networking business, an executive said on the call.Predicting the outlook is difficult due to Covid-19 in the U.S. and Europe, said Samsung Securities analyst Hwang Min-seong. “But the good news is that China is showing signs of a fast recovery,” he said. “Still, there are concerns over whether chip demand will be sustainable in the second half despite improved sentiment on server demand.”SK Hynix Inc. and Micron Technology Inc., which control the bulk of the memory chip market together with Samsung, have told investors that strong demand from data-center clients boosted sales and profits and that the trend is expected to continue in the first half.Read more: Hynix’s Sales Rise Most in Year After Lockdowns Boost DemandChip companies have projected that the contract prices for DRAM and NAND will remain solid throughout the second quarter. In addition to server expansions, the pandemic is seen as a catalyst for expediting the transition to 5G and autonomous or touchless technology, driving component sales.Apple and Huawei Technologies Co. supplier Hynix said there was a possibility that even server demand could lose steam if the economic downturn is prolonged. Intel withdrew its full-year sales forecast last week for the year, citing “significant” uncertainty.“Demand for server and PC to remain solid as more people work from home, but a decline in mobile demand to remain a risk,” Samsung said Wednesday in an earnings presentation.Sluggish sales of Samsung’s flagship S20 lineup will be reflected in the current quarter, eroding profitability at the smartphone division, which has been reeling from plant and store shutdowns in some regions.Its display business had a 290 billion won operating loss after smartphone sales from Apple and Huawei sharply fell in the first quarter. The consumer electronics unit, which includes TVs and appliances, reported operating profit of 450 billion won. Samsung’s major overseas appliances plants temporarily shut from March through early April.Still, some investors hope for a rebound in consumer demand starting in the second half as the coronavirus recedes.“There will be pent-up demand in the second half of the year, or at least in the first half of next year,” Claire Kyung Min Kim, a Hana Financial Investment semiconductor analyst, told Bloomberg Television. “People want to buy new phones or change to a new 5G phone, and this kind of demand can’t be pressured for a long time, over three years or over four years.”(Updates with Samsung executive’s comments from the fourth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
In its first-quarter earnings report today, Samsung said it expects the COVID-19 pandemic to continue impacting its business for the rest of the year, cutting into sales for smartphones and TVs, but increasing demand for PCs, servers and memory chips as people continue to work or study from home. Samsung’s results for the first-quarter of 2020 was in line with the guidance it released earlier this month. The COVID-19 pandemic has caused more than 3 million confirmed cases around the world and more than 217,000 deaths, and resulted in shelter-in-place orders in countries around the world and a global recession.
Samsung Electronics Co Ltd said on Wednesday it expected profit to decline in the current quarter due to a coronavirus-related slump in sales of smartphones and TVs, although the chip business would remain solid. The South Korean conglomerate joined other tech giants such as SK Hynix and Intel in declining to provide annual forecasts because of the uncertainty about the duration of the pandemic. It said that while work-from-home orders and the related growth in online learning would underpin demand for memory chips, the outlook for smartphones and TVs was bleak as consumers put off discretionary spending.
(Bloomberg Opinion) -- Negative oil prices are like a massive underwater detonation. Inevitably, dead sea animals will come floating to the surface. This week we saw the unraveling of a Singapore-based oil trading firm, which now owes 23 global banks almost $3.9 billion. So you’ve got to wonder who’s next, and if another big whale will go belly up.Your first thought might be a large oil producer, or a bank active in trade financing. But most of the drama has circled around exchange traded funds. It turns out, passive funds — big winners from the global financial crisis — aren’t so different from active funds after all.Take a look at the world’s largest oil ETF, the $3.7 billion United States Oil Fund, which has been anything but passive lately. For a second straight day, it reshuffled the mix of futures it owns to track crude prices. The fund now plans to reduce its holdings in near-term contracts — June futures, in this case — to about 20%, with the rest divided roughly among July (50%), August (20%) and September (10%). In a better world, all of its portfolio would be in June contracts right now.The USO fund simply wanted to cut its own losses. If June futures also go negative, its investors would suffer a total wipeout. But at least they won’t have to dig into their pockets to close positions: An ETF can't trade below zero. Someone else — the clearing exchanges or even the fund provider — will have to soak up the losses.There’s good reason to suspect this possibility. Unlike Brent, the West Texas Intermediate contract is settled through physical delivery, and storage units are getting full. So if the coronavirus outbreak rages on, sapping end demand, investors in June futures could end up in tears, too.This active portfolio management is terrible news for believers in buy-and-hold investing. When fund managers rejigger methodology on-the-go — which the fine print allows — we just don't know how to calculate returns. More specifically, longer-term investors end up buying oil at much higher prices than necessary.We live in what the USO fund calls a “super contango” world, in that long-dated futures value oil at a much higher price than front month contracts. So instead of buying oil via June futures at about $14 a barrel, we’re potentially gaining exposure at about $20.70, based on Thursday morning pricing in Asia.The USO ETF at least has the good sense to rebalance its portfolio into a basket with various maturity dates. The Hong Kong-listed Samsung S&P GSCI Crude Oil ER Futures ETF said in a filing Wednesday that it will roll over all of its June contracts to September futures “shortly after” the announcement, without providing a time frame. The September contract costs 85% more.Granted, fund managers could say this flurry of activity aims to protect us. That’s not a passive fund’s job. We buy ETFs because we fancy ourselves active managers. If we’re worried about negative June oil, we could just liquidate our holdings. And what if we think this week was a one-time event? A great buy-on-the-dip opportunity was stripped from us.By tweaking their portfolio compositions, passive funds can no longer meet their investment objective, which is to reflect the daily percentage changes of the crude spot price, as USO eloquently said in a filing itself.No doubt, negative prices toss up nasty surprises. But fund managers panicked, and lost their investment mandate along the way. We, in turn, lost our confidence in these cheap products, too.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Shuli Ren is a Bloomberg Opinion columnist covering Asian markets. She previously wrote on markets for Barron's, following a career as an investment banker, and is a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Announcement of Periodic Review: Moody's announces completion of a periodic review of ratings of Best Buy Co., Inc. New York, April 22, 2020 -- Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of Best Buy Co., Inc. and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers.
China has allowed 200 employees from South Korea's Samsung Electronics Co Ltd to enter the country to work on an expansion of the firm's NAND memory chip factory, the company said on Wednesday. The move came after China said on Tuesday that it was in talks with some countries to establish fast-track procedures to allow travel by business and technical personnel to ensure the smooth operation of global supply chains. China said it has reached a consensus on such an arrangement with South Korea, without elaborating on the terms, including whether individuals entering China will be subject to quarantine.
A leading Chinese chipmaker, Yangtze Memory Technologies, said it now has the ability to produce the same 128-layer 3D NAND flash memory chips as those to be sold by rival Samsung Electronics Co Ltd.What happened Wuhan based Yangtze Memory Technologies Co Ltd. (YMTC), announced on Sunday that its 128-layer 1.33 Tb QLC 3D NAND flash memory chip -- X2-6070 had passed a sample verification carried out by its partners. The company plans to introduce these chips to the market this year.Similar chips will also be manufactured by rivals Samsung, Micron, SK Hynix, and Kioxia. At the moment, these companies make the 96-layer 3D NAND flash memory chips. Yangtze Memory makes a 64-layer version, which it introduced in the second half of 2019, reports the Nikkei Asian Review.In a statement, Yangtze's Senior Vice President of marketing and sales said, "As a new entrant in the flash memory industry, YMTC has reached to new heights by launching the 1.33 Tb QLC product." She lauded the company's employees and partners by saying, "We are able to achieve these results today because of the incredible synergy created through seamless collaboration with our global industry partners, as well as remarkable contributions from our employees."Why It Matters According to the Review, YMTC is an affiliate of China-backed Tsinghua Unigroup and has been trying to catch up with foreign rivals to create a fully domestic semiconductor industry.Memory chips are important components of many electronic devices such as smartphones, computers, and the like. Chips with more layers are difficult to manufacture, but it is more cost-efficient as they can be accommodated on a single chip wafer.Even though the company is based in Wuhan - the epicenter of the COVID-19 pandemic, it has managed to stay open throughout the strict lockdown. Full production was started on April 10.A research company analyst told Nikkei YMTC would still have to overcome some technical problems before being able to smoothly mass produce the chip, but "It's so far the most promising player in China's hope to build a viable semiconductor industry and reduce its dependence on foreign chipmakers," the analyst observed.He expects YMTC's rivals could see some competition from the Chinese firm by the end of 2021.Price Action On Monday, Samsung shares traded 1.12% lower at $39.91 at press time in Seoul.See more from Benzinga * WeWork Fails To Pay Rent At Several US Locations: Report * JPMorgan Will Only Accept Small Business Loans Under Federal Scheme, Suspends All Others * Starbucks Shares Fall As Q2 Earnings Halve Amid Pandemic(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.