The founder of Grillo's Pickles, Travis Grillo, is here to talk about his fast-growing pickle business. Yahoo Finance’s Dan Roberts, Sibile Marcellus, and Zack Guzman test the pickles and grill Grillo on his delicious product.
The founder of Grillo's Pickles, Travis Grillo, is here to talk about his fast-growing pickle business. Yahoo Finance’s Dan Roberts, Sibile Marcellus, and Zack Guzman test the pickles and grill Grillo on his delicious product.
(Bloomberg) -- SoftBank Group Corp.’s Vision Fund profit may reach an unprecedented $30 billion in the March quarter, almost quadrupling the record it had just set, according to people familiar with the matter.Profit in the unit was supercharged by the successful initial public offering of Coupang Inc., the South Korean e-commerce leader which debuted in New York last month. That will account for the lion’s share of what’s expected to be between $25 billion and $30 billion in reported gains for the three months ended March 31, the people said, asking not to be named because the details are not yet public. SoftBank is scheduled to report results on May 12.The markets are delivering their strongest validation yet for Masayoshi Son’s oft-criticized strategy of pouring massive amounts of cash into mature startups. The Vision Fund’s portfolio of over 160 investments will record its third straight quarter of record profits helped by a global IPO rush that has seen companies worldwide raise more than $200 billion in 2021.When Son takes the stage to report the latest results, he will probably have one more milestone to celebrate: group net income that’s the highest ever for a listed Japanese company in any quarter dating back to 1990, according to data compiled by Bloomberg. SoftBank already holds the top spot, setting the current high of 1.26 trillion yen ($11.5 billion) in June.Coupang’s $4.6 billion offering was the second biggest this year and marks SoftBank’s best return since Alibaba Group Holding Ltd.’s listing in 2014. The coming months will also see some of Son’s largest and most controversial bets test the market, including ride-hailing giants Grab Holdings Inc. and Didi Chuxing as well as the troubled office-sharing company WeWork.“The markets are very encouraged and supportive of what the Vision Fund has been able to do with its investments,” said Justin Tang, head of Asian research at United First Partners in Singapore. “Clearly there is still a lot of money out there that needs to find a home.”Coupang’s stock ended the quarter 41% higher than its mid-March IPO. The Vision Fund invested in November 2018 in a $2 billion deal that valued Coupang at $9 billion. That funding followed $1 billion from SoftBank itself in 2015, valuing the startup at about $5 billion. The Japanese conglomerate’s 33% stake was worth close to $28 billion as of March 31.SoftBank will also book a valuation gain of about $2 billion on its stake in Uber Technologies Inc., which rose about 7% in the quarter, according to the people. The fund sold $2 billion worth of stock in the ride-hailing company in January, eking out a small profit. Another $1.2 billion gain will come from its stake in Auto1 Group SE, a German wholesale platform for used cars which went public in February.The Vision Fund will also book a gain on its stake in ByteDance Ltd., the Chinese parent of hit video app TikTok. SoftBank owns about 3% of the company, a stake it acquired mostly at a $63 billion valuation in secondary markets in addition to a direct investment at a $75 billion valuation, the people said. The company has since hit $140 billion, according to market researcher CB Insights, and traded at $250 billion in private transactions, Bloomberg News reported.Even WeWork, one of Son’s biggest missteps in recent years, will contribute to profit. After its failed IPO attempt and a bailout by SoftBank in 2019, the office-sharing company saw its worth tumble to $2.9 billion last year amid the pandemic, a far cry from its once-lofty $47 billion valuation. WeWork now plans to go public via a blank-check company in a deal that would value it at $9 billion.Some Vision Fund investments will see their value marked down, though gains will more than offset those losses, the people said. The fund will take a writedown of about $500 million on Greensill Capital, the supply-chain finance company owned by billionaire Lex Greensill that filed for insolvency last month. The valuation of Oyo Hotels will be reduced by several hundred million dollars too.“Coupang is a home run for the Vision Fund. And there is likely to be more good news around Didi, ByteDance, Grab and even WeWork,” said Atul Goyal, senior analyst at Jefferies. “But profits are meaningful when they recur. These gains are neither operating nor recurring.”SoftBank doesn’t have to sell equity holdings to book income, so its profits are often just on paper. It reports income when the value of companies like Coupang rise, boosting the value of its stock. Its accounting practices comply with industry standards.About half of the capital raised in the IPOs so far this year has gone to special purpose acquisition companies and SoftBank has joined the frenzy, listing several blank-check companies since the start of the year. The three SPACs created by the Vision Fund have a combined market capitalization of about $1.5 billion.At the previous earnings briefing in February, Son said SoftBank may see between 10 and 20 public listings a year. Grab said this week it will go public through the largest-ever merger with a blank-check company, valuing the Southeast Asian ride-hailing and delivery giant at about $40 billion. Its Chinese counterpart Didi has filed with the U.S. Securities and Exchange Commission for an IPO that could value the company as highly as $70 billion to $100 billion.“The wind will probably continue to be at Son’s back for some time,” said United First Partners’ Tang. “But matching last fiscal year’s performance would be quite a feat.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- The European Union is poised to ban artificial intelligence systems used for mass surveillance or for ranking social behavior, while companies developing AI could face fines as high as 4% of global revenue if they fail to comply with new rules governing the software applications.The rules are part of legislation set to be proposed by the European Commission, the bloc’s executive body, according to a draft of the proposal obtained by Bloomberg. The details could change before the commission unveils the measure, which is expected to be as soon as next week.The EU proposal is expected to include the following rules:AI systems used to manipulate human behavior, exploit information about individuals or groups of individuals, used to carry out social scoring or for indiscriminate surveillance would all be banned in the EU. Some public security exceptions would apply.Remote biometric identification systems used in public places, like facial recognition, would need special authorization from authorities.AI applications considered to be ‘high-risk’ would have to undergo inspections before deployment to ensure systems are trained on unbiased data sets, in a traceable way and with human oversight.High-risk AI would pertain to systems that could endanger people’s safety, lives or fundamental rights, as well as the EU’s democratic processes -- such as self-driving cars and remote surgery, among others.Some companies will be allowed to undertake assessments themselves, whereas others will be subject to checks by third-parties. Compliance certificates issued by assessment bodies will be valid for up to five years.Rules would apply equally to companies based in the EU or abroad.European member states would be required to appoint assessment bodies to test, certify and inspect the systems, according to the document. Companies that develop prohibited AI services, or supply incorrect information or fail to cooperate with the national authorities could be fined up to 4% of global revenue.The rules won’t apply to AI systems used exclusively for military purposes, according to the document.A European Commission spokesman declined to comment on the proposed rules. Politico reported on the draft document earlier.“It’s important for us at a European level to pass a very strong message and set the standards in terms of how far these technologies should be allowed to go,” Dragos Tudorache, a liberal member of the European Parliament and head of the committee on artificial intelligence, said in an interview. “Putting a regulatory framework around them is a must and it’s good that the European Commission takes this direction.”As artificial intelligence has started to penetrate every part of society, from shopping suggestions and voice assistants to decisions around hiring, insurance and law enforcement, the EU wants to ensure technology deployed in Europe is transparent, has human oversight and meets its high standards for user privacy.The proposed rules come as the EU tries to catch up to the U.S. and China on the roll-out of artificial intelligence and other advanced technology. The new requirements could hinder tech firms in the region from competing with foreign rivals if they are delayed in unveiling products because they first have to be tested.Once proposed by the commission, the rules could still change following input from the European Parliament and the bloc’s member states before becoming law.Tudorache said it was critical that the final version of law doesn’t stifle innovation and limits bureaucratic hurdles as much as possible.“We have to be very, very clear in the way we regulate - when, where and in which conditions, engineers and businesses have to actually go to regulators to seek authorization and to be very clear where it’s not,” he said.(Updates with reaction from MEP in 12th, 16th paragraphs)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Alibaba’s run-in with Chinese regulators has made things tense for its other technology giants.
Oil prices rose on Thursday to the highest level in nearly a month, after jumping 5% in the previous session, driven by increased demand forecasts from the International Energy Agency (IEA) and OPEC as major economies recover from the pandemic. Brent crude was up by 16 cents at $66.74 a barrel by 0659 GMT, after reaching $66.94 earlier, the highest since March 18, and gaining 4.6% on Wednesday. U.S. West Texas Intermediate futures rose 12 cents to $63.27 a barrel, earlier rising to $63.48, also the highest since March 18.
(Bloomberg) -- Coinbase Global Inc.’s highly anticipated direct listing had touched off a frenzy in demand for all things crypto. A tumble shortly after its debut dented the euphoria.Bitcoin pulled back from an all-time high as the biggest U.S. crypto exchange tumbled to close down 14%. It opened at $381 a share in its direct listing shortly before 1:30 p.m. in New York and spiked as high as $429 in the first 10 minutes of trading before turning lower. It closed at $328.28. Bitcoin fell to its session low when Coinbase turned, before paring losses. It was trading around $63,160 as of 8:12 a.m. in Hong Kong.The listing is seen pushing crypto even more into the mainstream of investing, exposing legions of potential buyers to digital tokens, which have grown into a $2 trillion industry in little more than a decade. Bitcoin, the original and biggest crypto coin, is valued at more than $1 trillion alone after a more than 800% surge in the past year.At the closing price, Coinbase’s valuation on a fully diluted basis is about $86 billion. Given its size and visibility, Coinbase is likely to be popular with actively managed equity funds, particularly growth managers, essentially making a large swath of stock holders passive investors in crypto.“It’s a huge step forward for the industry and the legitimacy it brings in the eyes of investors and regulators,” Mati Greenspan, founder of Quantum Economics, said on Bloomberg TV.Read more: Bitcoin ETF Drumbeat Gets Louder as Eight Issuers File With SECGrowing mainstream acceptance of cryptocurrencies has spurred Bitcoin to a 120% rally since December, as well as lifting other tokens to record highs. That’s despite lingering concerns over their volatility and usefulness as a method of payment. Attention from regulators is poised to intensify as Coinbase becomes a public company.“As the direct listing on the Nasdaq will reach a wider investment base other than the usual crypto evangelists, investors must expect much greater government scrutiny,” said Nigel Green, CEO and founder of deVere Group.(Updates prices in the third paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- Hundreds of thousands of small Indian businesses are planning to protest against large foreign retailers like Amazon.com Inc. in an event Thursday that coincides with the U.S. e-commerce giant’s annual seller jamboree in the South Asian nation, a sign of escalating tensions in the retail market of 1.3 billion people.The summit is the latest protest by local traders, which have long accused global retailers Amazon and rival Walmart Inc.-owned Flipkart of masquerading as platforms and employing unfair practices that hit at the livelihoods of small online and offline sellers. The trader groups’ event is named Asmbhav, or “impossible” in Hindi, and takes place on the first day of Amazon’s annual seller extravaganza, called Smbhav, or “possible.”“Over half-a-million sellers and leading small trader groups are participating in the Asmbhav event which will focus on ruined livelihoods because of the bullying and partisanship by e-commerce marketplaces,” said Abhay Raj Mishra of the non-profit Public Response Against Helplessness and Action for Redressal (PRAHAR), one of the organizers of the event spearheaded by a collective of Indian sellers.India’s small traders, distributors and merchants have petitioned the country’s courts and antitrust regulator to curb the foreign retailing giants ahead of a potential revision of foreign investment rules. The government is expected to tighten regulations that already bar e-commerce platforms from owning or controlling companies that sell on their platform, forging exclusive deals with makers of products such as smartphones, and discounting goods sold on their platforms.Amazon’s seller event -- which made its debut last year with founder Jeff Bezos in attendance -- will span four days this year and be held virtually. Key business figures including former Pepsico Inc. Chief Executive Officer Indra Nooyi, telecom operator Bharti Airtel Ltd.’s Chairman Sunil Mittal, India’s chief economic adviser Krishnamurthy Subramanian and Infosys Ltd. co-founder and Chairman Nandan Nilekani will be among panel speakers. Participants will include small businesses, startups, developers and retailers.To counter Amazon’s Smbhav awards to select sellers, organizers of the protest event will hand out tongue-in-cheek “Asmbhav awards” to Bezos, country chief Amit Agarwal and its India business partner, Narayana Murthy, the billionaire co-founder of Infosys. The event is backed by trade groups like the All India Online Vendors Association and the All-India Mobile Retailers Association.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- The Federal Reserve will likely scale back its bond purchases before considering raising interest rates, Chairman Jerome Powell said, hardening expectations on the sequence of its eventual exit from aggressive policy support.“We will reach the time at which we will taper asset purchases when we’ve made substantial further progress toward our goals from last December, when we announced that guidance,” Powell said Wednesday in a virtual event hosted by the Economic Club of Washington. “That would in all likelihood be before -- well before -- the time we consider raising interest rates. We haven’t voted on that order but that is the sense of the guidance.”The appearance was the latest of several by the Fed chair this month, including an interview on CBS’s “60 Minutes” show on Sunday in which he said the economy appears to have turned a corner toward faster growth amid widening vaccinations against Covid-19, but central bankers would not be in a hurry to remove their support.Policy makers will wait until inflation has reached 2% sustainably and the labor-market recovery is complete before considering lifting interest rates, and the combination is unlikely to happen before 2022, he said. Their forecasts last month signaled rates being held near zero through 2023.The U.S. central bank enters its traditional blackout period on public comment on Friday night ahead of the April 27-28 meeting of the Federal Open Market Committee.“When the purchases go to zero, the size of the balance sheet is constant, and when bonds mature you reinvest them,” Powell said. “And then another step -- and we took this late in the day in the last cycle -- was to allow bonds to start to runoff. And we haven’t decided whether to do that or not.”Powell added that he doesn’t think the Fed would actually sell bonds into the market, something it also didn’t do during the recovery from the 2008 financial crisis.Fed Vice Chair Richard Clarida made a similar point about the sequencing of the exit strategy in remarks later Wednesday.“We’re going to reduce the pace of purchases at some point and that would occur prior to any decision about lifting off,” he said in response to question during a virtual event hosted by the Shadow Open Market Committee. Noting that he has a “very robust” baseline outlook for U.S. growth in 2021 that could be the fastest in 35 years, Clarida added that policy makers were not going to act on a forecast.“This is going to be outcome based. We’re going to be looking at the labor market indicators and the inflation data as it comes in,” he said.Patience PledgedPowell and his colleagues have pledged to be patient and maintain aggressive monetary policy support, even as the economic recovery from the pandemic picks up speed. That dovish view has helped U.S. stocks reach fresh record highs. Recent data has also painted a brighter picture as vaccinations spread and the economy reopens, with employers adding 916,000 jobs in March.“Most members of the committee did not see raising interest rates until 2024, but that isn’t a committee forecast, it isn’t something we vote on or or act on as a group -- it really is just our assessment,” Powell said. “Markets focus too much on what we call the economic predictions, and I would focus more on on the outcomes that we’ve described.”Fed policy makers substantially lifted their growth and employment forecasts at the central bank’s meeting last month. Their median estimate sees the economy expanding 6.5% this year and the unemployment rate declining to 4.5% by the end of 2021.Powell said the U.S. is going into a period of faster growth and job creation, and that the main risk is another spike in Covid-19 cases due to virus strains that may be more difficult to treat.Minutes of the central bank’s March meeting released April 7 said policy makers expect it will likely be “some time until substantial further progress” was made on employment and inflation. That refers to the threshold they’ve set for scaling back bond purchases of $120 billion a month.(Updates with comments from Clarida in ninth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- The U.S. economy is emerging from a year of lockdowns in a big way and that’s showing up in the oil market.A rolling average of U.S. gasoline demand rose to the highest since August, according to the latest data from the Energy Information Administration. The nation’s refineries are processing the most crude crude oil in over a year just after the pandemic started as they make more fuel for the upcoming summer travel surge. At the same time, crude supplies fell by the most in two months, bringing nationwide stockpiles to the lowest since late February.The data underpin the recovery in the oil market a year after the pandemic spurred a historic demand crash. Gasoline demand has been leading the comeback, with more gains in diesel and jet fuel needed to provide sure footing for markets after the pandemic slump. West Texas Intermediate crude futures surged more than 5% Wednesday and broke out the narrow trading range they had been stuck in since mid-March.The oil rally comes during a period of quicker economic expansion, as cited in a speech Wednesday by Federal Reserve Chair Jerome Powell. Gasoline prices have averaged about $2.86 as gallon this spring amid predictions they should hit $3 a gallon this year for the first time since 2014.Careful supply management by refiners has helped maintain balance. Only 300,000 barrels of gasoline were added to storage last week, even with more production. Stockpiles are about 28 million barrels below where they were a year ago.“These numbers are quite constructive for gasoline,” said Houston oil analyst Andy Lipow. “We are headed to what looks like a decent summer driving season with Americans having been pent up with their desire to get out on the road.”To be certain, the market still has a long way to go for a full recovery, gasoline demand is at 8.8 million barrels day compared with 9.4 million barrels seen in April 2019.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
The IRS commissioner says the child credit payments will arrive on time after all.
The S&P 500 hit a record high on Tuesday and the Nasdaq jumped as investors flocked to technology-related stocks after the United States' pause in the rollout of Johnson & Johnson's COVID-19 vaccine sparked fears of a delay in a broader economic rebound. The drugmaker's shares fell 2.7% to a one-month low as calls for pausing the use of its COVID-19 vaccine after six women developed rare blood clots dealt a fresh setback to efforts to tackle the pandemic. The technology and consumer discretionary sectors, which house high-flying technology names that flourished during coronavirus-induced lockdowns last year, rose 0.6% and 0.4%, respectively.
Pfizer Inc can deliver 10% more doses of its COVID-19 vaccine to the United States by the end of May and meet its target of supplying 300 million doses two weeks earlier than expected, Chief Executive Officer Albert Bourla said in a tweet on Tuesday. Pfizer had promised to provide the U.S. government with 100 million doses by the end of March and another 100 million by the end of May, with the rest being delivered by the end of July. Separately, the company said it had conducted an assessment of the vaccines' safety data and had found no evidence of blood clots.
The number is 40% higher than the reference price Nasdaq released Tuesday.
(Bloomberg) -- Turkey’s central bank is likely to leave its benchmark interest rate unchanged in the first monetary policy meeting of its newly appointed governor.Installed after President Recep Tayyip Erdogan abruptly fired his predecessor following a bigger-than-expected rate increase, Sahap Kavcioglu is under pressure to reduce rates but has so far signaled he would not rush to loosen the stance he inherited.All but two respondents in a Bloomberg survey of 25 analysts expect the central bank to keep the one-week repo policy rate at 19% on Thursday. The dissenters, HSBC Bank PLC and Capital Economics Ltd, predict the meeting will deliver a reduction of 50 and 200 basis points, respectively.“Kavcioglu’s initial communication to markets has done enough to alleviate apprehensions about a major policy reversal at the April meeting,” said Ehsan Khoman, Head of Emerging Market Research for Europe, Middle East and Africa at MUFG Bank in Dubai. Turkey “does not have the policy room to lower rates this year given the elevated inflation outlook” but Kavcioglu’s dovish views suggest the central bank will eventually take a more accommodative stance.In a written interview with Bloomberg after his appointment last month, Kavcioglu said markets shouldn’t view a rate cut at the April 15 Monetary Policy Committee meeting as a given, easing some concerns among investors.Turkey raised its benchmark one-week repo rate by 200 basis points on March 18, at Naci Agbal’s final rate-setting meeting as governor, citing concerns about inflation. A professor of banking, Kavcioglu was among the critics of that move, saying it could damage economic growth.Last week, Erdogan said the government was determined to both reduce inflation and cut interest rates to single digits, prompting a slide in the lira. The currency has weakened more than 10% against the dollar since the unexpected appointment of Kavcioglu.What Our Economists Say:“Turkey President Recep Tayyip Erdogan would like the new-look central bank to lower interest rates, but market forces will likely delay the delivery of his orders. With inflation rising and the lira weakening, we expect the monetary policy committee to keep rates on hold when it meets on Thursday.” --Ziad Daoud, Bloomberg Economics (Read More: Market Forces to Keep Turkey Central Bank on Hold)Inflation accelerated to an annual 16.2% through March, up from 15.6% the previous month because of a global oil rally and weaker currency, leaving the new central bank chief little room to enact the interest-rate cuts that would mollify Erdogan, who holds the unorthodox view that high interest rates cause inflation.Among the dissenters, Jason Tuvey, senior emerging markets economist at Capital Economics, said they are basing their forecast of a big rate cut more “on the basis of pressure from Erdogan.”“If I was governor, I would hike interest rates,” he said, “but I’d probably get sacked the next day.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- The direct listing of Coinbase Global Inc. on Nasdaq is a turning point for the whole cryptocurrency sector, according to the firm’s Chief Executive Officer Brian Armstrong.Banks used to hang up on Coinbase’s calls and many people thought the digital-currency platform was a bad idea, Armstrong said during a discussion on the Clubhouse app after the stock’s debut. Now top executives from the banks that helped Coinbase go public are calling to ask how they can get more into crypto themselves, he said.“It feels like a shift in legitimacy not just for Coinbase but the whole industry,” Armstrong said. “Crypto has a shot at being a major force in the financial world.”Coinbase, which fell 14% on its debut Wednesday to close at $328.28, now has a valuation of about $86 billion on a fully diluted basis. That compares with a 2018 funding round that valued it at around $8 billion. The listing was widely anticipated by the wider crypto community, with many coin prices and crypto-affiliated company shares rising in advance of it, before falling back once the trading started.The company’s growth hasn’t been without controversies, such as restrictions Armstrong placed on employee discussions of politics last year, or frequent outages during periods of heavy trading. Some people criticize the level of fees charged by the exchange.There was also a settlement with the Commodity Futures Trading Commission for $6.5 million regarding claims Coinbase had reported inaccurate data about transactions and that a former employee engaged in improper trades.More generally, skeptics maintain that crypto could be in a bubble, and may suffer due to regulatory changes around the globe. Coinbase and its backers see more strength ahead.“There was tremendous depth and richness to what these guys were doing,” said Marc Andreessen, co-founder of investment firm Andreessen Horowitz, one of Coinbase’s biggest shareholders, in a portion of the same Clubhouse discussion talking about what made the company an appealing investment.Andreessen said Coinbase provided a combination of “a company that’s conservative enough to be compliant from a regulatory perspective but also relentlessly innovative.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Wealthy investor Mike Novogratz speculates that bitcoin could be worth $100,000 by the end of 2021 and sees that value increasing by five-fold by 2024, as the nascent crypto market continues to evolve and grow.
Before sitting back and letting the IRS do the work, experts say some people should at least consider filing an amended return.
The IRS sent out COVID-19 relief checks to nearly 2 million more Americans. It included more than 700,000 "plus-up" payments for people who were eligible for additional money.
(Bloomberg) -- Taiwan Semiconductor Manufacturing Co. warned that a global shortage of semiconductors across industries from automaking to consumer electronics may extend into 2022, prompting the linchpin chipmaker to lift targets on spending and growth for this year.The world’s largest contract chipmaker said Thursday that its auto industry clients can expect chip shortages to begin easing next quarter, alleviating some of the supply disruptions that have forced the likes of General Motors Co. and Ford Motor Co. to curtail production. But overall deficits of critical semiconductors will last throughout 2021 and potentially into next year, Chief Executive Officer C.C. Wei told analysts on a conference call.TSMC now expects investments of about $30 billion on capacity expansions and upgrades this year, after spending $8.8 billion in the first three months, Chief Financial Officer Wendell Huang said. The company had previously forecast spending of as much as $28 billion. Sales in the June quarter may be between $12.9 billion and $13.2 billion, beating the average $12.8 billion seen by analysts, though its target for gross margin came in below expectations at 49.5% to 51.5%. Full-year revenue may climb 20% in dollar terms, ahead of the “mid-teens” growth predicted in January.“We see the demand continue to be high,” Wei said. “In 2023, I hope we can offer more capacity to support our customers. At that time, we’ll start to see the supply chain tightness release a little bit.”TSMC joins a growing number of industry giants from Continental AG to Renesas Electronics Corp. and Foxconn Technology Group that warned of longer-than-anticipated deficits thanks to unprecedented demand for everything from cars to game consoles and mobile devices. While Taiwan’s largest chipmaker has kept its fabs running at “over 100% utilization,” the firm doesn’t have enough capacity to satisfy all its customers and it has pledged to invest $100 billion over the next three years to expand.Read more: See How a Chip Shortage Snarled Everything From Phones to CarsSemiconductor shortages are cascading through the global economy. Automakers like Ford, Nissan Motor Co.and Volkswagen AG have already scaled back production, leading to estimates for more than $60 billion in lost revenue for the industry this year. The situation is likely get worse before it gets better: a rare winter storm in Texas knocked out swaths of U.S. production, while a fire at a key Japan factory will shut the facility for a month. Rival chipmaker Samsung Electronics Co. warned of a “serious imbalance” in the industry.With major American carmakers and other gadget suppliers facing a prolonged shortage of chips, U.S. President Joe Biden has proposed $50 billion to bolster semiconductor research and manufacturing at home. The initiative could aid TSMC’s plan to build a cutting-edge fab in Arizona this year that could cost $12 billion.TSMC is “happy” to support chip manufacturing in the U.S., though research and development and the majority of production will continue to remain in Taiwan, executives said on Thursday. They reiterated that construction of their plant in Arizona will begin this year.Read more: Why Shortages of a $1 Chip Sparked Crisis in Global EconomyNet income for the January-March period climbed 19% to NT$139.7 billion ($4.9 billion), beating the average analyst estimate of NT$136.2 billion, buoyed by demand for high-performance computing (HPC) equipment and a milder seasonal effect on smartphone demand. Gross margin for the quarter eased to 52.4% from 54% in the three months prior, due in part to relatively lower levels of utilization and exchange-rate fluctuations. First-quarter revenue rose 17% to NT$362.4 billion, according to a company statement last week.The company said Thursday it now expects to be able to achieve the higher end of its compound annual growth rate target of 10% to 15% for the five years to 2025, citing its investment spending plans.“TSMC’s statement that the chip crunch may spill into 2022 will smooth over concerns that chip demand may fall on overbooking later this year and further boost investors’ confidence in the overall semiconductor demand in the long run,” said Elsa Cheng, an analyst at GF Securities.Shares of TSMC have more than doubled over the past year. The stock advanced 1.1% on Thursday, before the company reported earnings.TSMC’s most-advanced technologies continued to account for nearly half of revenue in the March quarter, with 5-nanometer and 7-nanometer processes contributing 14% and 35% of sales, respectively. By business segment, its smartphone business amounted for about 45% of revenue, while HPC increased to more than a third, reflecting sustained demand for devices and internet servers even as economies start to emerge from the pandemic.“We are seeing stronger engagement with more customers on 5-nm and 3-nm, in fact the engagement is so strong that we have to really prepare the capacity for it,” Wei said. Smartphones and HPC will be the main drivers for demand of 5-nm, which will contribute around 20% of wafer revenue this year.TSMC Is On Fire. Just Beware of the Flames: Tim Culpan(Updates with company comments throughout)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
(Bloomberg) -- China should build more pig farms in Xinjiang as its cotton industry is under threat from declining soil fertility, according to a government researcher, commenting after some international companies avoided fiber produced in the region over allegations of forced labor.Hog farming could become a pillar industry in the region and supply 10% of the nation’s output, up from 1% now, wrote Mei Xinyu, a think-tank researcher at the commerce ministry. Xinjiang already grows more than 80% of the country’s cotton, and some of those pig farms would replace fields sown to the fiber that have been degraded.The suggestion comes after the U.S. banned imports of textile products containing cotton from Xinjiang in protest over alleged ill-treatment of its ethnic Uighur Muslim minority, and several western countries slapped sanctions on China over the same issue.Cotton is the most profitable crop in the region, and rotation to other crops is not in the interests of growers and hard to achieve on a large scale, Mei said on the WeChat account of Beijing News, a government-run newspaper. The only feasible option is to build more hog farms, he said, and they can use local grain to feed the pigs or import supplies from neighboring countries.Xinjiang Production and Construction Corps, a military-affiliated entity, and other groups have already started building several large-scale pig farms, which will increase output significantly in the next two years. In the meantime, animal waste from the farms could be used to boost soil fertility, which has been exhausted by extensive use of chemical fertilizer, said Mei.“The most desirable way to solve this problem is to raise pigs and grow cotton simultaneously, and return a large amount of manure from pig farms to the fields after treatment to enhance soil fertility and increase profits,” Mei said.China should expand hog farms in areas like Xinjiang and Heilongjiang, which are less population-intensive than the inland provinces like Sichuan, Hunan and Henan which dominate the country’s pork production, Mei said. Outbreaks of African swine fever that started in 2018 slashed hog herds by as much as half and sent meat imports spiraling to a record.(Updates with details from the report throughout)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Federal tax returns are due May 17, but many people still need to pay their first quarter 2021 estimated tax payments April 15. Plus more tax tips.