|Bid||47,950.00 x 0|
|Ask||48,000.00 x 0|
|Day's Range||46,850.00 - 49,700.00|
|52 Week Range||40,850.00 - 62,800.00|
|Beta (5Y Monthly)||0.95|
|PE Ratio (TTM)||N/A|
|Earnings Date||Apr 28, 2020 - May 05, 2020|
|Forward Dividend & Yield||1,416.00 (2.93%)|
|Ex-Dividend Date||Dec 27, 2019|
|1y Target Est||54,903.00|
(Bloomberg) -- Microsoft Corp.’s agreement to acquire 5G software maker Affirmed Networks Inc. valued the company at about $1.35 billion, according to people familiar with the matter.Microsoft announced the deal on Thursday without disclosing financial details.Microsoft already serves telecom customers and struck an agreement with AT&T Inc. last year with the aim of moving more the carrier’s network to its platform. Microsoft has been building its cloud computing operations through acquisitions. In 2018, it bought privately held GitHub for $7.5 billion.Affirmed Networks also held talks with Samsung Electronics before its deal with Microsoft came together, one of the people said.Pete Wootton, a spokesman for Microsoft, declined to comment on the price. A representative for Affirmed Networks also declined to comment. Samsung didn’t respond to a request for comment.Microsoft shares fell 4.1% Friday to close at $149.70.The introduction of 5G is just starting, with test projects by carriers such as AT&T generally limited to select big cities. Nationwide U.S. coverage may take years. But tech giants and telecom industry incumbents have been angling for a slice of the market for edge computing and going after big corporate customers. The White House has made 5G a linchpin of its tech policy, particularly as it tries to suppress the global expansion of China’s Huawei Technologies Co.The networking industry is transitioning away from expensive fixed purpose machines that take care of specific parts of the job of managing the flow of data to software that resides in remote data centers. The aim is to make the things cheaper and more flexible.Affirmed Networks helps build virtual networks for telecom customers using 5G technology. It was founded in 2010 and had raised about $240 million in funding, according to Pitchbook Data. It raised financing just last month at a $1.35 billion valuation, people familiar with the matter said.Affirmed Networks said on Thursday that it was replacing its chief executive officer with one of its founders, Anand Krishnamurthy.Affirmed Networks, based in Acton, Massachusetts, is backed by investors including Qualcomm Ventures and Centerview Capital Technology Management, the venture arm of investment bank Centerview Partners, as well as by Lightspeed Management, CRV and Bessemer Venture Partners,(Updates with line on Samsung’s interest in fourth paragraph, adds share price in sixth 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.
Huawei has announced the release of the flagship phone, but the launch comes at a time when many countries are imposing lockdowns, or asking for voluntary social distancing due to COVID-19.What Happened Huawei's P40 Pro Plus will be released on April 7, the company announced on Thursday. The flagship phone comes with a camera containing 5 sensors capable of 100x zoom. The P40 Pro Plus is the priciest in the P40 range at 1,399 Euros ($1,545).CNBC cited Ben Wood, chief analyst at CCS Insight, an industry analyst firm on the launch, "Arguably there could not be a worse time to launch a set of premium smartphones given the current global headwinds, but Huawei may be in a better position than some rivals."Why It Matters The COVID-19 pandemic has led to stay-at-home or lockdown orders in major phone markets such as India, China, the U.S., and Europe. Rival Apple Inc. (NASDAQ: AAPL) is considering putting off the launch of its first-ever 5G flagship device to 2021 due to pandemic related concerns.Due to trade restrictions imposed on Huawei, Alphabet Inc.'s (NASDAQ: GOOGL) (NASDAQ: GOOG) Android operating system is not supported on Huawei's devices. Popular applications like Gmail and YouTube are also absent from the phones.Huawei is developing its own Harmony OS operating system to get around the U.S. imposed restrictions, but has yet to ship any phones running it.The P40 Plus' camera was developed with German lensmaker Leica, the same company that Samsung Electronics Co. Ltd. (OTC: SSNLF) works with for its S20 range. P40 Plus pars with Samsung's Galaxy S20 Ultra and supports 5G.See more from Benzinga * Ariel Chairman John Rogers Thinks Current Market Is 'Once In A Lifetime Opportunity To Buy Stocks' * Tim Cook Announces Apple 10M Masks Donation To US Health Workers * Groupon's CEO And COO Resign(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
(Bloomberg) -- Sony Corp. said fallout from the coronavirus may wipe out a previously projected increase in its profit and force it to delay an earnings report scheduled for April.The Japanese company said two factories in China are returning to normal operation but continue to face component shortages, while facilities in Malaysia and U.K. will remain shut until middle of April because of government requests. Sony said it can’t dispatch employees to these locations to discuss assembly of new products.Sony had raised its forecast on Feb. 4, saying operating income will probably reach 880 billion yen ($8.1 billion) in the year ending March 31, compared with the 840 billion yen forecast in October. If profit comes in at the earlier figure, that would be a shortfall of about $370 million.“Given their high exposure to consumer spending, it is not surprising that COVID-19 is having an adverse impact on their business,” said Damian Thong, an analyst with Macquarie Capital.Sony joins a growing list of corporations forced to revise or scrap financial forecasts because of the virus.Apple Inc., Expedia Group Inc., and Twitter Inc. are among the technology companies that have withdrawn or modified guidance in the wake of the pandemic, which has disrupted supply chains, upended demand and forced millions of people to work from home. On Thursday, Dell Technologies Inc. and VMWare Inc. became the latest to withdraw their earnings outlooks.Sony had been benefiting from strong demand for the image sensors that power smartphone cameras, but production and sales of such devices have taken a hit in recent weeks. It supplies Apple and Samsung Electronics Co., among others.A Sony spokeswoman said it doesn’t see any notable impact on the launch of its next-generation game console PlayStation 5 planned at the end of this year.Sony shares have slid about 10% this year.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.
For Samsung Electronics Co Ltd <005930.KS>, the 2020 Tokyo Olympics were going to be its springboard to attain a long-held goal - making significant inroads into Japan's lucrative smartphone market where Apple Inc <AAPL.O> dominates. It had been expected to tout its 5G capability in its Olympics ads, aiming to attract a population excited to watch the Games with cutting-edge technology before Apple had a 5G product on the market.
(Bloomberg) -- Micron Technology Inc. predicted stronger-than-expected revenue helped by a surge in orders from data center operators who are building more capacity to deal with the expansion of people working from home.Revenue will be $4.6 billion to $5.2 billion in the fiscal third quarter, which ends in May, Micron said Wednesday in a statement. Analysts had projected $4.88 billion, according to data compiled by Bloomberg. Adjusted earnings will be 55 cents a share, plus or minus 15 cents. Analysts, on average, estimated 52 cents a share.Micron is one of the first chip industry companies to report earnings and give predictions since millions of people have been told to stay home to help slow the spread of the Covid-19 pandemic. That huge shift in the workforce has placed a greater strain on the internet’s infrastructure, spurring demand for Micron’s memory chips and making up for some of the shortfall in orders for smartphone components, as shoppers stay away from stores.“In the data center market, we benefited from strong demand for our products from key cloud and enterprise customers, driven in part by ongoing strength in cloud markets, increased use of online properties such as e-commerce, and the surge in remote-work requirements due to COVID-19 containment measures,” Micron Chief Executive Officer Sanjay Mehrotra said in prepared remarks posted on the company’s website.In a slide presentation, Micron also cited increased gaming activity. While the markets for smartphones, consumer electronics and autos are below previous expectations, Micron said it’s seeing an increase in demand for notebooks to support work at home and virtual learning.The company has two employees who have tested positive for the virus. Through efforts to quarantine them, there hasn’t yet been an impact on the company’s manufacturing output, Micron said. The Boise, Idaho-based company has plants in Singapore, Malaysia and Japan, where the spread of the virus was felt sooner. That raised concern Micron’s output would slow. The company, however, said it has resumed manufacturing in Malaysia and found testing and assembly facilities in other parts of the world to help.“Micron still has ample inventory that would limit a near-term supply chain disruption,” Cowen and Co. analyst Karl Ackerman wrote in a report before the results were released. “The supply bottleneck has morphed into a demand challenge, however, and our field work on the smartphone and PC supply chains indicates low visibility for second calendar-quarter production.”The company makes dynamic random access memory chips, which help processors crunch data in computers and smartphones, and Nand flash memory, which stores information in those devices. Memory used in servers is typically more expensive and chips used in storage for those machines also usually commands a higher price.Micron cautioned that its numbers are a lagging indicator of orders for end products and that some customers may be stockpiling chips, which may mask the true picture of demand.Shares rose about 5% in extended-trading following the report. They closed at $42.50 earlier on Wednesday, leaving them down 21% this year.Net income in the period ended Feb. 27 fell to $405 million, or 36 cents a share, from $1.62 billion, or $1.42 a share, a year earlier. Revenue declined 18% to $4.8 billion. Micron’s biggest competitors are South Korea’s Samsung Electronics Co. and SK Hynix Inc.(Updates with comments from CEO in 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.
Announcement of Periodic Review: Moody's announces completion of a periodic review of ratings of Samsung Electronics Co., Ltd. Hong Kong, March 24, 2020 -- Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of Samsung Electronics Co., Ltd. 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.
(Bloomberg) -- A two-hour drive south of Amsterdam in Veldhoven, workers decked out head-to-toe in protective gear toil in vast assembly halls. Before entering the inner sanctuary of the facilities, they meticulously layer on masks, gloves and special socks. A single speck of dust or a hair can have devastating effects on production. The result of all this painstaking process is an environment that is 10,000 times more purified than outside.And as the coronavirus grips the world, it might just be the safest place to work right now.The teams belong to ASML Holding NV, which holds a de-facto monopoly on the industry of extreme ultraviolet lithography machines needed to make next-generation chips. Each cost about 150 million euros ($160 million) apiece and ship mainly to the U.S., Korea and Taiwan, where the likes of Intel Corp., Samsung Electronics Co. or Taiwan Semiconductor Manufacturing Co., known as TSMC, rely on them to make faster, cheaper and more energy efficient semiconductors.ASML manufacturing staff operate in an environment that is literally shielded from the coronavirus pandemic that has forced millions of workers around the world to isolate themselves from colleagues to slow the spread of the disease. As the rest of the Netherlands and much of the continent locks down, work in ASML’s Veldhoven clean-rooms has continued largely unhindered, potentially giving the company an edge for when corporate life returns to normal.“So far we have been able to keep our production going,” said Frits van Hout, ASML’s chief strategy officer, ASML. “The situation is of course dynamic. We encounter challenges as with every lockdown our suppliers will be affected, directly or indirectly.”Keeping DistanceLike other companies, ASML has also implemented a raft of contingency measures –from segmenting staff to drawing up plans if disaster strikes at a key supplier -- so it can keep manufacturing equipment for chip-makers around the world. Workers are split into two teams and are screened for virus symptoms via infrared thermal cameras at the entrance of the clean room in Veldhoven.Social distancing protocols are in effect, and the company has spaced out the morning and night shift to ensure the groups don’t meet, ASML said.Clean rooms are highly specialized infrastructure that’s costly to set up and maintain, making that kind of environment difficult to replicate in other industries. The biggest risk for the company lies not so much in its own operations seizing up but in a potential breakdown of its 5,000 suppliers, 790 of which provide materials and equipment that are used directly to produce the ASML systems.Besides its ultra-sanitized work environment, ASML has the benefit of making machines that are considered almost recession-proof, given its commanding lead in an industry on the cusp of another technological leap: high-speed 5G networks.On Track“Most customers want EUV and if ASML cannot deliver due to such a factor, then they know they have to wait until the next quarter because you cannot get it anywhere else,” said Marcel Achterberg, executive director of equity research at KBC Bank.The prized EUV machines are the size of a bus. Customers can order older equipment, but EUV delivers better resolution, smaller components and improved performance in the chips it produces.They’re a crucial source of revenue for ASML’s customers, too. By the end of next year, as much as half of TSMC’s revenue will depend at least partly on some EUV processes, according to Bloomberg Intelligence analyst Masahiro Wakasugi.Volume production of TSMC’s most cutting-edge 5-nanometer chips, which use EUV, is still “on track” for the first half of 2020 as previously stated by management, TSMC spokeswoman Nina Kao saidFor 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.
South Korean exports rose 10.0% in the first 20 days of March year-on-year as lockdowns across the world to prevent the coronavirus fueled demand for teleconferencing technology and components. Outbound shipments of semiconductors, the nation's major export, jumped 20.3% on-year, the Korea Customs Service data showed on Monday, better than a 15.4% rise seen a month earlier. "Demand from cloud computing firms have boosted sales of server chips, while an increase in telecommuting in the United States and China has also been a main drive to huge server demand," a trade ministry official told Reuters.
India's cabinet has approved a 480 billion rupees ($6.37 billion) plan to boost electronics manufacturing and woo large investment to a country which, following Prime Minister Narendra Modi's Make-in-India drive, has become the world's second-biggest mobile phone manufacturer. New Delhi will provide companies a production-linked incentive of 4% to 6% on incremental sales - over base year 2019-20 - of goods made locally for five years, the government said in a statement on Saturday. The move is likely to boost exports from India, where global companies such as Samsung Electronics Co Ltd, Apple Inc - through contract manufacturers Hon Hai Precision Industry Co Ltd (Foxconn) and Wistron Corp - Xiaomi Corp and Oppo assemble smartphones.
(Bloomberg) -- Apple Inc. kept its business rolling through the coronavirus pandemic this week by launching a new iPad Pro and two new Macs. But that doesn’t mean its supply chain is in the clear.Deliveries of the new products will begin arriving on doorsteps next week. However, production of those devices likely started in early January, before the worst effects of China’s virus lockdown in February, according to people familiar with Apple’s supply chain.With a fresh round of supplier factory closures enforced by Malaysia, and the virus disrupting operations in much of the rest of the world, the iPhone maker’s supply chain has not fully recovered yet.Apple’s next flagship iPhones, with 5G wireless capabilities, are still on schedule to launch in the fall, although that’s partly because mass production isn’t due to begin until May, said the people. They asked not to be identified discussing private supply chain issues.“Even as China comes back on line, we are beginning to wonder if Covid-19 will impact other supply oriented geographies,” Brad Gastwirth, chief technology strategist at Wedbush Securities, wrote in a recent note to investors. “While China is improving, the supply chain for the electronics industry may yet see substantial disruptions.”An Apple spokesman declined to comment. Chief Executive Officer Tim Cook, the architect of the company’s China-focused supply chain, said Feb. 28 that production issues would be a “temporary condition.”Apple’s assembly factories in China, run mainly by Hon Hai Precision Industry Co., were in low gear for much of February. The manufacturing giant, also known as Foxconn, hopes to begin operating normally by the end of March.The February slowdown led to iPhone and AirPods supply constraints, but those have begun to subside. This week, Apple has been limiting iPhone purchases to two per customer on its online store in several countries. In early March, the company warned retail employees about shortages of replacement iPhones.One new product unveiled this week suggests there’s strain on Apple’s supply chain, but also shows the company can still mass produce gadgets given enough time. The keyboard accessory for the iPad Pro was announced Wednesday but goes on sale in May, an unusual delay.Read more: Supply Shock Is Wiping Out Hopes of Smartphone Sales GrowthMass assembly is only one part of Apple’s supply chain. The company and its many partners spend months or years sourcing individual components that are assembled into final products. Any disruptions in this complex network could slow the introduction of future devices.One person who works in Apple’s supply chain said not all operations are moving at normal speed because the flow of components to assemble is still slow. It will take another month or more to get parts moving steadily through the system, the person added.Jabil Inc., which makes iPhone casings, recently said its factories in China were “near normal,” while plants in other parts of the world were running 5% to 10% below capacity.“Most of that is due to supply chain issues. In some odd way, as we sit today, I think China is the least of our concerns,” CEO Mark Mondello told analysts during a March 13 conference call. “We’re able to accommodate all of the demand that’s in front of us as long as we can get parts.”A two-week lockdown in Malaysia is affecting several key suppliers that have operations in the country. Murata Manufacturing Co., Renesas Electronics Corp. and Ibiden Co., which make chips and circuit boards for Apple, have halted production there.Micron Technology Inc., which makes memory chips for Apple devices, is also impacted, but said an exemption allows “limited semiconductor operations to continue.” Texas Instruments Inc. and On Semiconductor Corp. have facilities in Malaysia, too.Apple has suppliers and operations in other countries that have been hammered by the virus, including Italy, Germany, the U.K. and South Korea.Samsung Display and LG Display Co. make iPhone screens in South Korea, while many Apple engineers working on cellular modems are based in Munich, Germany. Apple also operates former Dialog Semiconductor Plc facilities that work on power-management chips in Livorno, Italy, Nabern and Neuaubing, Germany, and Swindon, U.K.Apple has several hundred research and development engineers for future processors and underlying technologies in Israel, which is only letting citizens leave their homes for essential reasons, like buying food and medicine.Read more: Israel’s Netanyahu Orders Near Total LockdownIn the U.S., Apple has suppliers such as Corning Inc. for glass, and Qorvo Inc., Skyworks Solutions Inc. and Broadcom Inc. for wireless chips. Broadcom Chief Executive Officer Hock Tan said recently that the virus “is going to have an impact on our semiconductor business, in particular in the second half of the fiscal year.”Chips take months to make and test, and companies build up months of inventory. That means Apple and other device makers may not have seen the worst of the disruptions yet.The virus is likely challenging Apple’s ability to design and test early versions of future products in Silicon Valley, which is grappling with a shelter-in-place mandate. The company has instated a remote work order, save for some mission-critical employees, for all its offices outside of China.San Francisco’s Shelter-in-Place Order Shows U.S. What’s to ComeThese struggles have yet to severely derail the 5G iPhone launch in the fall. During China’s factory shutdown in February, Apple was able to build a limited number of test versions of the new models, one of the people familiar with the company’s supply chain said.Apple finalizes the majority of design features for new iPhones between November and December of the year prior to launch, the people said. It begins mass-producing new casings around April and then starts a late manufacturing stage called Final Assembly, Test and Pack in about May.Should Apple be unable to send full teams of engineers to China factories to finalize designs and resolve issues, this typical timeline could still slip, another person familiar with the company’s supply chain said.(Updates with Jabil comments in 12th 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.
The Korean electronics group topped its annus horribilis by overtaking Apple as the biggest profit generator in the second quarter of 2017. It was, as Geoffrey Cain writes in Samsung Rising, “part of the genius of Samsung’s business model”. Questionable as all that may be as a business model, it makes for a gripping read.
Samsung Electronics and LG Electronics, central to South Korea’s postwar economic miracle, are the world’s largest suppliers of memory chips, organic light emitting diode (OLED) displays and camera modules. For consumers, tightening supply of iPhone and iPads is already a problem, as the outbreak disrupted production in China. Apple has closed all its stores outside China and cut quarterly revenue forecasts.
Samsung Electronics Co Ltd said on Wednesday the coronavirus pandemic would hurt sales of smartphones and consumer electronics this year, while demand from data centers would fuel a recovery in memory chip markets. Chief Executive Kim Ki-nam said the coronavirus and U.S.-China trade disputes were casting a shadow over the outlook for the South Korean tech giant, whose Galaxy smartphones vie with Apple's iPhones for global dominance. While the smartphone market would shrink, Kim said the chip market - which makes up about half of Samsung's operating profit - would see demand growth after a slump last year exacerbated by excess supply and U.S.-China trade tensions.
The U.S. International Trade Commission said on Monday it would open an investigation into possible patent violations involving touch-controlled mobile phones, computers and computer parts by Apple Inc , Amazon.com Inc and a slew of other companies following a complaint filed by Neodron Ltd of Ireland. The trade body said the decision to open an investigation did not constitute any decision on the merits of the case.
(Bloomberg) -- Samsung Electronics Co. “strongly advised” its employees to work from home in a memo on Monday, escalating its response to the coronavirus pandemic.The document, reviewed by Bloomberg News, sets out the company’s wide-ranging efforts to curb the spread of the virus while minimizing business disruption. Entrance to its facilities is now subject to a health screening, international travel has been restricted to only “mission-critical journeys” and there are Samsung task forces around the globe to track and implement the latest expert advice. The company has even sent care packages to some who are working from home or undergoing self-quarantine.The memo was confirmed by a Samsung representative.Samsung has had to suspend production at its Gumi factory in South Korea on three successive weekends due to discoveries of Covid-19 infections. The advice from the company is to work from home “where possible,” so it’s unlikely to be taken up by most workers involved in its manufacturing operations. Still, the company employs more than 300,000 people globally across 52 sales offices, 15 regional offices and dozens of research, design and development centers.The world’s largest maker of smartphones, displays and memory chips is stepping up control measures after infections rose in its home country of South Korea. Apple Inc. suppliers LG Display Co. and LG Innotek Co. briefly halted their production lines earlier this month after they reported infections. SK Hynix Inc. found the first Covid-19 case in its Icheon chip-manufacturing complex on Friday, though that had no impact on production, according to a spokesperson.Elsewhere in the tech industry, Apple, Alphabet Inc.’s Google, Microsoft Corp. and Facebook Inc. have all canceled plans for developer conferences that were set to take place in the coming months. Twitter Inc. has made working from home mandatory for those able to keep going remotely. It will also keep paying hourly-wage workers through the period of disruption caused by the coronavirus outbreak, in a move that’s been echoed across Silicon Valley.To contact the reporter on this story: Sohee Kim in Seoul at email@example.comTo contact the editors responsible for this story: Edwin Chan at firstname.lastname@example.org, Vlad SavovFor 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.
SEOUL/SHANGHAI (Reuters) - Apple is taking the temperature of customers at its China stores, Australian grocer Woolworths is providing dedicated shopping hours for the elderly and Samsung will use thermal imaging to vet shareholders at its annual meeting. Companies across Asia are taking novel and sometimes drastic steps to implement "social distancing" measures to try slow the spread of the coronavirus, which has infected more than 170,00 globally and killed more than 6,500. Australian casino operators, and rivals, Crown Resorts and Star Entertainment announced plans to take half their electronic gaming machines and table offline to ensure their customers got some space.
Technology giant Samsung Electronics has adopted electronic voting for the first time ever for this year's annual general meeting (AGM) on March 18, urging shareholders to use it to help curb the spread of coronavirus. Samsung's AGM is taking place at a convention center in Suwon, about 30 km (18 miles) south of Seoul, with a capacity of about 3,000 people according to the center website. Samsung's investor relations website on Monday urged shareholders to take advantage of the chance to vote via the internet up to March 17.
(Bloomberg Opinion) -- Markets dominated by companies sensitive to global business cycles may have little choice when investors start to use them as a proxy for general pessimism. In that light, South Korea’s measure to ban short selling for six months, the first such restriction since 2011, isn’t as rash as it might seem.The coronavirus outbreak came at the worst time for President Moon Jae-in. Only a few months ago, the Kospi Index finally came out of a deep bear market, characterized by steep conglomerate discounts and historically low trading turnover. Then the virus hit, hammering the benchmark index right back into bear territory. On a two-, five- and 10-year horizon, Korea’s stock market has consistently underperformed its north Asian peers of China, Japan and Taiwan.Moon may feel that he is doing a good job controlling the outbreak. He quickly unveiled an extra $9.8 billion budget to fight a virus-induced slowdown, and Korea’s less draconian, tech-savvy containment measures have been lauded by health experts.But his good efforts aren’t being rewarded by investors. On Friday, the Kospi hit its first circuit breaker since Sept. 11, 2001, which prompted the short-selling ban.When conventional methods fail, market-unfriendly ones become the next step. With investors animated and frantically trading, the case for restrictions on short selling is much stronger now than, say, last summer’s slow downward grind.If there’s one lesson we have learned from the global financial crisis, it’s that global economic growth is hard to come by. Lower productivity aside, we’ve had unpleasant shocks beyond the coronavirus, from the U.S.-China trade war to an oil-price crash.As a result, industrial behemoths such as Samsung Electronics Co. and SK Hynix Inc., which rely on the global supply chain, get dumped first in a market meltdown. And when you think of companies listed in Seoul, it’s just these sorts of export machines that dominate.Earlier in the year, foreigners were still net buyers of Korean stocks, cheered that memory-chip prices had stabilized, and by prospects that oversupply would finally meet increasing demand. The coronavirus changed the calculus entirely. Since late January, foreigners net sold $8.3 billion of Korean stocks, cashing out about $4.3 billion from Samsung and another $800 million from Hynix.Even if a government is doing everything right, sentiment toward its stock market may not go in lockstep. Given the Kospi’s cyclical nature, the world might just be coming out of a recession when the six-month ban ends, and will look at Korea fondly once again.The Bank of Korea said Friday it was considering an emergency meeting. But as we’ve seen in U.S. stock futures’ reaction to the Federal Reserve’s daring rate cuts and quantitative-easing relaunch, conventional policy methods fail to inspire market confidence in the face of the coronavirus.Ultimately, some blame still lies at the feet of the Moon administration for failing to transform market structure fast enough. Chaebol reform, Moon’s ambitious campaign promise to untangle Korea's web of conglomerates, has stalled. The dominance of these companies hamper Korea Inc.’s will and ability to innovate, leading to a dearth of unicorns needed to freshen up the Kospi. Instead, we’re left with Samsung, which earns 85% of its sales overseas and has seen its operations slow because of the virus. In recent weeks, Vietnam’s quarantine of South Korean arrivals kept engineers from reaching its mega factories there.If Americans are lamenting the end of the S&P 500’s bull run, Koreans must be wondering if their stock market can ever recover. As we’ve learned from the collapse of Lehman Brothers Holdings Inc., a cyclical market isn’t a healthy one.To contact the author of this story: Shuli Ren at email@example.comTo contact the editor responsible for this story: Rachel Rosenthal at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of 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.
(Bloomberg) -- Saudi Aramco is slashing planned spending this year in the first sign that plunging demand and the oil-price war the kingdom unleashed are hitting home.Capital expenditure will be between $25 billion and $30 billion in 2020 and spending plans for next year and beyond are being reviewed, Aramco said. The oil giant is lowering that range from the planned $35 billion to $40 billion announced in its IPO prospectus, and compares with $32.8 billion in 2019.“That was the surprise,” Ahmed Hazem Maher, an analyst at EFG Hermes in Cairo, said of the spending cut. “They’re adding production in a low price environment so their cash flows could be impacted.” Cutting investment could help absorb some of the impact of the drop in oil prices, he said.The oil-price war led by Saudi Arabia and Russia means more pain for Aramco as producing nations prepare to boost supply. Discounted pricing to markets already reeling from weak demand and crude that lost roughly half its value since the beginning of the year is likely to hit revenue further.Aramco shares fell as much as 1% on Sunday, extending the decline this year to about 19%. Aramco’s market value has slumped from a peak of over $2 trillion in December to about $1.5 trillion. Aramco executives are set to brief financial analysts of the results at 3 p.m. Saudi time on Monday.The coronavirus’ blow to oil use has overwhelmed OPEC’s initial optimism for demand this year, with analysts now expecting a drop in consumption. The OPEC+ group’s failure on March 6 to agree on further cuts is only exacerbating a glut as buyers search for storage tanks and vessels.“We have already taken steps to rationalize our planned 2020 capital spending,” Chief Executive Officer Amin Nasser said. Given the impact of the coronavirus pandemic on economic growth and demand, Aramco is adopting “a flexible approach to capital allocation,” he said.Saudi Arabia, Russia and others intend to boost production once the current accord to lower output expires in March. The kingdom pledged to supply 25% more oil in April than it produced last month, and Wednesday ordered Aramco to boost output capacity by 1 million barrels a day.Oil prices fell last year even as Saudi Arabia trimmed output as part of efforts between OPEC and other producers to rein in production. Drone and missile attacks on two of its biggest facilities in September temporarily slashed production by more than half, but didn’t cause a big surge in prices.Aramco reiterated its plan to pay $75 billion in dividends this year. The company needs to balance its pledge to pay investors with spending on its upstream projects -- maintaining oil production and expanding fields -- and boosting its global refining and chemical operations -- the downstream segment of the business.“Aramco can restructure the strategy to concentrate more on the upstream expansion rather than downstream,” said Mazen Al-Sudairi, head of research at Al Rajhi Capital. “They can do it easily from their cash flow. But it might affect the money transfer to the government for one or two quarters.”Brent crude averaged $64.12 a barrel in 2019 compared with $71.67 the previous year. Saudi production slipped to an average of 9.83 million barrels a day from 10.65 million in 2018, according to data compiled by Bloomberg. Aramco restored output to pre-attack levels by early October.Aramco’s 2018 net of $111 billion made it by far the world’s most profitable company, exceeding the combined incomes of some of the world’s biggest companies including Apple Inc., Samsung Electronics Co. and Alphabet Inc.\--With assistance from Verity Ratcliffe.To contact the reporters on this story: Anthony DiPaola in Dubai at email@example.com;Matthew Martin in Dubai at firstname.lastname@example.orgTo contact the editors responsible for this story: Nayla Razzouk at email@example.com, Stefania BianchiFor 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.
India's Goods and Services Tax Council has increased the tax on mobile phones and parts, Finance Minister Nirmala Sitharaman said on Saturday, a move that could lead to higher prices. Sitharaman, who heads the council, composed of representatives from all Indian states, said taxes on mobile phones and parts would rise to 18% from 12%. The move could make popular mobile phones from firms including Apple Inc and Samsung more expensive.
Samsung is developing a state-of-the-art solid-state battery pack that could send range anxiety the way of the carburetor. The list of car and tech companies racing to bring solid-state battery technology to the market grows annually. Getting it right while keeping costs in check is easier said than done, and most engineers agree we won't see these batteries in showrooms until the middle of the 2020s, but Samsung believes it's very close to cracking the code.
Vietnam allowed entry to nearly 200 engineers from Samsung Electronics' display unit from South Korea on Friday without making them go into quarantine for 14 days, the South Korean embassy in Vietnam said. Samsung Electronics accounts for a quarter of Vietnam's exports, and the Southeast Asian country is South Korea's third-biggest export market, and the fifth-biggest source of South Korea's imports.
Intel (NASDAQ:INTC) stock is going to make people a lot of money once the market stops falling.Source: canon_shooter / Shutterstock.com Since Feb. 19, shares have dropped from $67 to their March 12 price of below $50. This has taken the price-to-earnings ratio below 12, and the dividend yield to almost 2.5%. The company had free cash flow of almost $17 billion last year so it's selling at just 13 times that.It's hard to think of bargains when you can't look at your portfolio, but if there's some cash or equivalents there it's time to count it. When the Dow Jones stops dropping, the rebound is going to be swift. There is an enormous amount of money on the sidelines, and there was even before the coronavirus from China.InvestorPlace - Stock Market News, Stock Advice & Trading TipsSome of that will go into Intel. Made Some MistakesIntel remains a flawed company that didn't get the full benefit of the tech sector's run-up. Under CEO Robert Swan it is being run out of the finance department. Its fabrication plants are now considered second-rate compared with those of Taiwan Semiconductor (NYSE:TSM). Even management admits that its 10 nanometer production will be less profitable than what it produced at 22 nm, because of competition. Hedge funds were dumping it even before the virus hit. * The 10 Best Stocks to Buy After The Market's Historic Sell-Off Despite this, Intel stock has gotten the full brunt of the downturn, with shares down by about one-quarter. The company known as "Chipzilla," co-creator of the integrated circuit with Texas Instruments (NYSE:TXN), is no longer considered best of breed.Intel's old chips are highly insecure. The latest bug, called LVI, was found by teams of university researchers and will require a complete redesign to fix. It impacts five years of production.Intel is finding it hard to crack the memory market, after breaking with Micron Technology (NASDAQ:MU) a few years ago. Intel may have to work closely with Micron to meet its own needs.After telling people to work from home and banning travel to China, Intel then found an employee tested positive for the coronavirus after visiting its Arizona plant. Green ShootsWhy, then, am I telling you to fit this dog into your portfolio?First, you don't need to have the best chips to sell into the cloud. You need the most chips, and the cheapest chips. Intel isn't going to lose its data center business.Second, Intel is about to take this bargain approach into other niches. It has announced a full range of networking silicon for 5G mobile networks. It thinks it can grow that part of the business from $5 billion per year to $25 billion in three years. Through Barefoot Networks, acquired for $7 billion last year, Intel is demonstrating switches that run data at 12.8 Terabytes/second. This will expand its reach in the data center market.Intel may be second-rate, but it does rate. It expects to have 7 nm chips in production next year, and still hopes to lead when the industry gets to 5 nm a few years later. The Bottom Line on Intel StockIntel doesn't have to be the innovation leader to make money in chips. In the cloud era it's how many competitive chips you make that determines how much money you make.Intel is one of only four companies making microprocessors. The others are Samsung Electronics (OTCMKTS:SSNLF), Taiwan Semiconductor and privately held Global Foundries. The capital constraints of Moore's Second Law, in which manufacturing costs rise with chip complexity, guarantee it a place in the future.Given that reality, and its financial strength, Intel's comeback after the virus is guaranteed.Dana Blankenhorn has been a financial journalist since 1978. His latest book is Technology's Big Bang: Yesterday, Today and Tomorrow with Moore's Law, essays on technology available at the Amazon Kindle store. Follow him on Twitter at @danablankenhorn. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * The 10 Best Stocks to Buy After The Market's Historic Sell-Off * 9 Gold Stocks to Stave Off Coronavirus-Induced Volatility * 7 Stocks to Buy After International Women's Day The post Intel Stock Is Worth a Look When the Market Stabilizes appeared first on InvestorPlace.
(Bloomberg) -- Broadcom Inc., a chipmaker that supplies Apple Inc. and other large electronics companies, withdrew its annual sales forecast and gave weak near-term guidance, demonstrating how deeply the coronavirus pandemic is poised to hurt demand. The stock slumped 10%.“The fundamental semiconductor backdrop has been improving, and we did not see any material impact on our businesses due to COVID-19 in our first quarter,” Chief Executive Officer Hock Tan said in a statement. “However, visibility in our global markets is lacking and demand uncertainty is intensifying. As a result, we believe it prudent to withdraw our annual guidance until visibility returns to pre COVID-19 levels.”Sales in the current period will be $5.7 billion, plus or minus $150 million, the company said late Thursday. That missed Wall Street expectations. Tan said during a conference call with analysts that the quarterly target is largely in line with normal seasonal trends.While Broadcom’s supply chain is unscathed by the virus so far, the CEO said it’s impossible to assess yet how much consumer demand for electronics will decline.Broadcom’s stock dropped 10% in extended trading. The shares closed at $218.78 earlier in New York, leaving them down 30% so far this year.Broadcom is one of the largest technology companies so far to describe how its business is performing in the midst of the coronavirus health scare. Rising infections shut factories in China for weeks, disrupting trade and global supply chains, while curbing demand for hardware and software.The San Jose, California-based company makes chips for iPhones. Earlier this year, Apple scrapped its revenue guidance for the March quarter because of slowdowns in production and declining demand for its products after stores were closed in China.The fallout from Covid-19 comes as Broadcom, and other chipmakers, were already suffering from a trade dispute between China and the U.S. The company has been a major supplier to Huawei Technologies Co., but the Trump administration has forbidden U.S. companies from selling to the Chinese company. About a third of Broadcom’s products go into devices that are either bought in China or exported from China around the world.CEO Tan has built Broadcom into one of the biggest semiconductor makers through a string of deals. With customers including Apple and Samsung Electronics Co., Broadcom results are closely watched by investors.The company decided to keep investing in its wireless unit, ending speculation about a potential spinoff or sale. In January, Broadcom reported new long-term supply agreements with Apple. Tan said he changed his mind because of the certainty provided by a new customer commitment, not because of how the wireless unit was valued by possible acquirors.Sales in the fiscal first quarter of 2020, which ended Feb 2., rose 1 to $5.86 billion, the San Jose, California-based company said. Before certain items, profit was $5.25 a share. That compares with average analyst estimates for per-share profit of $5.34 on sales of $6 billion, according to data compiled by Bloomberg.(Updates with CEO comments in fourth paragraph.)To contact the reporter on this story: Ian King in San Francisco at firstname.lastname@example.orgTo contact the editors responsible for this story: Alistair Barr at email@example.com, Andrew PollackFor 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.