(Reuters) – Nvidia Corp forecast better-than-expected first-quarter revenue on Wednesday, betting on strong demand for its graphic chips used in gaming devices and data centers.
The company expects first-quarter revenue of $5.30 billion, plus or minus 2%, above analysts’ average estimates of $4.51 billion, according to IBES data from Refinitiv.
(Reporting by Chavi Mehta in Bengaluru; Editing by Maju Samuel)
(Reuters) – ViacomCBS Inc reported lower-than-expected quarterly revenue on Wednesday, as the COVID-19 pandemic brought forth content production delays and cut film revenue, despite steady demand for its streaming services CBS All Access and Showtime.
Ahead of its Paramount+ launch, a rebranded version of CBS All Access, the company has been scrambling to distinguish itself from bigger players including Netflix, HBO Max and Disney+ in the crowded over-the-top (OTT) market and attract more subscribers.
The company’s revenue rose 3% to $6.87 billion in the fourth quarter ended Dec. 31, but came in below estimates of $6.89 billion, according to IBES data from Refinitiv.
Net earnings attributable were $783 million, or $1.26 per share, compared with a loss of $302 million, or 49 cents per share, a year earlier.
(Reporting by Eva Mathews in Bengaluru; Editing by Maju Samuel)
By Jonathan Stempel
(Reuters) – Charlie Munger, the longtime business partner of Warren Buffett, on Wednesday warned that the stock market bears signs of a bubble, reflecting a “dangerous” mentality among some investors to gamble on stocks as they would horse races.
Munger, 97, lamented the recent mania for GameStop Corp, in which amateur investors encouraged each other online to buy the gaming retailer on platforms including Robinhood, and caught some hedge funds in a short squeeze.
“It’s really stupid to have a culture which encourages as much gambling in stocks by people who have the mindset of racetrack bettors,” he said.
“A lot of them crowd in to buying stocks on frenzy, frequently on credit, because they see that they’re going up, and of course that’s a very dangerous way to invest.”
Asked if the market resembled the late-1990s dot-com bubble, Munger said: “Yes, I think it must end badly, but I don’t know when.”
Munger was speaking at the annual meeting of Daily Journal Corp, the Los Angeles newspaper publisher he chairs, which was broadcast on Yahoo Finance.
He is better known as vice chairman of Buffett’s conglomerate Berkshire Hathaway Inc since 1978.
Munger said investors should not buy gold or bitcoin, noting the latter was too volatile to become a “medium of exchange for the world.”
He paraphrased author Oscar Wilde’s quotation about fox hunting to describe bitcoin, calling it “the pursuit of the uneatable by the unspeakable.”
Munger also expressed disdain for the surging demand for special purpose acquisition companies, or SPACs, which raise money from investors and then merge with private companies to take them public, in “blank check” arrangements.
“The world would be better off without them,” Munger said.
“This kind of crazy speculation in enterprises not even found or picked out yet is a sign of an irritating bubble,” he said. “It’s just that the investment banking profession will sell shit as long as shit can be sold.”
(Reporting by Jonathan Stempel in New York; Editing by Chizu Nomiyama and Richard Chang)
By Yingzhi Yang and Brenda Goh
BEIJING (Reuters) – Beijing-based ByteDance plans to move the chief of its Chinese news aggregator Jinri Toutiao, Zhu Wenjia, to Singapore to head global research and development for its hit short video app TikTok, two people familiar with the matter said. The role is newly created and would be the first senior R&D position for TikTok. Zhu will be in charge of the app’s product and technologies including its recommendation algorithms, the people said. His position will be parallel to TikTok’s interim head, Vanessa Pappas, and will report directly to ByteDance founder and Chief Executive Zhang Yiming, they said.
ByteDance declined to comment. The sources declined to be named as the information is not public.
TikTok had come under pressure from the Trump administration in the United States to divest the app’s U.S. operations over concerns that user data could be passed on to China, which TikTok has repeatedly denied.
Reuters reported last year that TikTok moved its key research capabilities outside China and had approached employees from tech giants.
Kevin Chen, a former Didi Chuxing executive who recently joined ByteDance, will replace Zhu as Toutiao’s new CEO, the sources said, adding that the personnel changes have not been internally announced and are still subject to change.
Zhu, now based in Beijing, joined ByteDance in 2015 and became Toutiao’s CEO in 2019. Prior to ByteDance, he worked as an architect at China’s search engine giant Baidu.
(Reporting by Yingzhi Yang in Beijing and Brenda Goh in Shanghai; editing by Jane Merriman)
By Akanksha Rana and Ben Klayman
(Reuters) – Electric-car maker Fisker Inc said it will work with Apple Inc supplier Foxconn to produce more than 250,000 vehicles a year beginning in late 2023, sending its shares up 18%.
The deal, codenamed “Project PEAR” (Personal Electric Automotive Revolution), is looking at markets globally, including North America, Europe, China and India, Fisker said.
Foxconn, Apple’s main iPhone maker, has ramped up its interest in electric vehicles (EVs) over the past year or so, announcing deals with Chinese electric-car maker Byton and automakers Zhejiang Geely Holding Group and Stellantis NV’s Fiat Chrysler unit.
Sources have said Apple is targeting 2024 to produce a passenger vehicle.
Foxconn aims to provide components or services to 10% of the world’s EVs by 2025 to 2027, Chairman Liu Young-way said in October.
The Taiwan-based company’s approach poses a major threat to established automakers that technology companies such as Apple and other non-traditional players could use contract assemblers as a shortcut to competing in the vehicle market.
“A lot of auto suppliers and manufacturers are looking to get a piece of this explosive growth that’s ahead for the global electric vehcile market,” said CFRA Research analyst Garrett Nelson, who has a “buy” rating on Fisker.
Fisker Chief Executive Henrik Fisker told Reuters that Foxconn is more than just a contract manufacturer under this deal and is developing the vehicle with the startup. He expects the deal to be finalized in the second quarter and to last about seven years. Terms of the deal were not disclosed.
Fisker said the new vehicle would be “futuristic” and “something completely different,” as well as “affordable.” It will launch in the fourth quarter of 2023, and is one of the four vehicles Fisker previously said it would introduce by 2025, he said.
“We’re not just going to make another electric car,” Henrik Fisker said in an interview. “We want to introduce things that probably will almost feel a little scary to some people.”
Where the vehicle will be built by Foxconn has not been set, he said.
The EV sector has been booming, with Tesla Inc still the market leader. On Tuesday, luxury electric-car maker Lucid Motors announced plans to go public by merging with a blank-check company.
The recent runup in valuations of several EV startups, including Nikola Corp and Lordstown Motors Corp, which have yet to produce saleable vehicles or meaningful revenue, has drawn comparisons to the dotcom bubble of 1999 to 2000, with analysts and investors expecting a near-term correction.
Fisker said in December that Canadian auto supplier Magna International Inc would initially manufacture its first vehicle, the Ocean SUV, in Europe. The production is on track to start in the fourth quarter of next year, said Henrik Fisker, who added that the Foxconn deal does not affect those plans.
(Reporting by Akanksha Rana and Tiyashi Datta in Bengaluru; Editing by Shounak Dasgupta and Jonathan Oatis)
By Elizabeth Howcroft and Tommy Wilkes
LONDON (Reuters) – Stocks, bonds and commodities? Old hat.
Once the preserve of the super-rich, or just the eccentric, all kinds of unusual investments from vintage handbags and shares in fine art to rare Pokemon cards are now the happy hunting ground for stuck-at-home punters.
Often armed with lockdown-era savings, such amateur investors are seeking higher returns beyond conventional markets where rocketing prices are prompting warnings of bubbles. They have in turn driven prices on some “alternative” assets up several hundred percent higher in the past year.
And just like the no-fee trading apps such as Robinhood that enabled hordes of small-time equity traders to rattle seasoned hedge funds during the recent “Gamestonks” episodes, digital platforms are empowering wannabe investors with as little as $20 to dabble in collectables.
Value can apparently lurk in all sorts of places.
Collectors’ cards based on Nintendo’s hit 1990s video game, Pokemon, have exploded in value in the past year.
One first-edition of its fire-flying character ‘Charizard’ has rocketed 800% in a year, after YouTube star Logan Paul paid $150,000 for one in October. Recent auctions have valued the card at $300,000.
Chicago-based Pokemon enthusiast Zack Browning, who purchased four of the cards in 2016 for less than $5,000 each, estimates his overall Pokemon collection is now worth $3 million-$5 million.
Browning, who embarked on his Pokemon investing career after studying finance at university, described the game card’s resurgence as “astounding and incredible”. He said that parts of the Pokemon market were more predictable than stock markets, which he said were overvalued.
‘PICK-ME-UPS’
Of course measuring profit or loss on a painting or gauging demand for such collectables is a lot harder than in equity or currency markets, given items often have little in common with each other and can be traded only occasionally, such as by auction.
But a luxury investment index published by compiler Knight Frank on Wednesday showed that although top-end assets such as fine art fell in value during the pandemic, “relatively affordable luxury pick-me-ups” did well.
While the AMR All-Art Index, based on auction prices, fell 11% last year, according to Knight Frank, Hermes’ iconic Birkin handbag first launched in the 1980s, rose 17%, ahead of fine wine and classic cars.
Andrew Shirley, who edits the Knight Frank report, said last year’s most expensive Birkin sold for $200,000, with Asian luxury collectors in Asia “very happy to bid on handbags online”.
For people unable to stump up $200,000 per item, there are platforms such as New York-based Otis which launched in 2019.
These platforms buy anything from a Pokemon card to a basketball jersey signed by basketball legend Kobe Bryant, securitise them and then offer investors shares in the items that they can buy and sell.
Last year, Otis offered customers the chance to buy shares in a work by British street artist Banksy at $20 a share. Those shares hit $34 earlier this month, a 70% gain that valued the piece at $722,000, Otis said.
Investors tend to be aged 25 to 45, with disposable incomes of $100,000-plus, Otis founder and Chief Executive Michael Karnjanaprakorn told Reuters.
He said the most expensive item on Otis is a 1986 Basketball card set by sports cards maker Fleer — sold two months ago at $10 a share, it has since surged 305% to over $40.
Reuters could not independently verify the price gains.
‘DON’T INVEST YOUR PENSION’
At another collectables platform, Rally, the number of users is doubling every 30 days, according to CEO George Leimer. He said “several hundred thousand” investors used the platform but declined to be more specific.
The platform has also seen sought-after Pokemon cards surge into six-figures, Leimer said.
“The drive behind this is very similar to what we are seeing in the rest of the retail investing world,” he said, pointing to the surge in popularity of Robinhood and other such apps.
But few seem to be banking profits; Leimer said the percentage of investors who withdrew their winnings rather than reinvest was in the “low single digits”.
As more punters flock to alternative assets, many warn of risks.
John-Paul Smith, a former senior equity strategist at Deutsche Bank, now dabbles in buying northern British art. He sees little difference between the behaviour of some “alternatives” investors and the equity frenzy.
“Banksy is pure momentum, it’s like a hot tech stock,” he said. “The psychology is similar in any market.”
But conceptually, it seems “less foolish” to buy unconventional assets today than at any time in the 30 years Smith says he has followed markets. Not only are stocks expensive, vast central bank and government stimulus will eventually spur inflation, he said.
He urges investors to differentiate between what might be a passion or a hobby and an investment. If they set out solely to profit, they probably won’t, given how esoteric each part of markets like art can be.
“I would not advise anybody (to) put their pension in,” he said, a stance also taken by Pokemon investor Browning.
(Additional reporting by Marc Jones; editing by Sujata Rao and Emelia Sithole-Matarise)
By Anna Irrera
LONDON (Reuters) – Stuck in space with bills to pay? Don’t worry, the satellites could take care of it.
JPMorgan Chase & Co has recently tested blockchain payments between satellites orbiting the earth, executives at the bank told Reuters, showing that digital devices could use the technology behind virtual currencies for transactions.
The so-called Internet of Things (IoT), where devices connect to one another, is most associated with consumer electronics, including smart speakers like Amazon Echo and Google Home, and banks want to be ready to process payments when these smart devices start doing transactions autonomously.Umar Farooq, the CEO of JPMorgan’s blockchain business Onyx, thought space was a cool place to try it out.
“The idea was to explore IoT payments in a fully decentralised way,” Farooq said. “Nowhere is more decentralised and detached from earth than space.”
“Secondly we are nerdy and it was a much more fun way to test IoT,” he said.
To run the space experiment, the bank’s blockchain team did not send its own satellites into space, but worked with Danish company GOMspace, which allows third parties to run software on its satellites.
Farooq said the satellite test showed blockchain networks could power transactions between every day objects.
The test also showed it could be possible to create a marketplace where satellites send each other data in exchange for payments, as more private companies launch their own devices into space, Tyrone Lobban, head of blockchain launch, at Onyx said.
Back on earth, examples of IoT payments that could become a reality sooner include a smart fridge ordering and paying for milk on an ecommerce site, or a self-driving car paying for gas Farooq said.
Blockchain, which first emerged as the software underpinning cryptocurrencies, is a shared digital ledger of transactions. Financial companies have invested millions of dollars to find uses for the technology hoping it can reduce costs and simplify more complex IT processes, such as securities settlement or international payments.
But so far, blockchain has yet to have widespread impact in financial services.
JPMorgan has been one of the most active banks in blockchain, announcing it had created its own distributed ledger called Quorum in 2016, which was sold to blockchain company Consensys last year. The bank also developed a digital coin called JPM Coin and in 2020 created Onyx.
Onyx has more than 100 employees and its blockchain applications are close to generating revenues for the bank, it said.
Among the division’s applications is Liink, a payments information network involving more than 400 banks, a project to replace paper checks and IoT experiments, Farooq said.
(Reporting by Anna Irrera. Editing by Jane Merriman)
BEIJING (Reuters) – China is ready to enhance exchanges with the United States on the trade and economic fronts, Wang Wentao, the country’s new commerce minister, said on Wednesday.
He looks forward to working with U.S. colleagues to focus on cooperation and manage differences, Wang told reporters in a news conference.
(Reporting by Gabriel Crossley; Editing by Christian Schmollinger)
By Byron Kaye and Colin Packham
CANBERRA (Reuters) – The architect of Australian media reforms being watched around the world claimed victory on Wednesday, even as critics said concessions to the laws forcing Big Tech to pay for news content have given Facebook and Google a get-out clause.
The Australian government made late changes to the laws after Facebook last week blocked news content in Australia, escalating a dispute over the proposed legislation and catching international attention.
The amended legislation is expected to pass the Senate this week, despite opposition from some minor opposition parties and independent politicians who argue it disadvantages smaller news companies.
Rod Sims, the chairman of the Australian Competition and Consumer Commission (ACCC), told Reuters the bargaining power imbalance he was tasked with correcting had been addressed.
“The changes the government’s done are things that either don’t matter much or are just to clarify things that, at least in Facebook’s mind, were unclear,” said Sims, who led the drafting of the legislation.
“Whatever they say, they need news. It keeps people on their platform longer – they make more money.”
With Australia’s reforms serving as a model for other nations to adopt, Facebook was also keen to claim a win.
Facebook Vice President of Global News Partnerships Campbell Brown stressed the company had retained the ability to decide if news appeared on its platform and could sidestep the forced negotiation for content payment under the original legislation.
In a key amendment to the legislation, Treasurer Josh Frydenberg was given the discretion to decide that either Facebook or Google need not be subject to the code, if they make a “significant contribution to the sustainability of the Australian news industry.”
The original legislation had required Facebook and Alphabet Inc’s Google to submit to arbitration if they could not reach a commercial deal with Australian news companies for their content, effectively allowing the government to set a price.
Facebook, which contends news accounts for just 4% of traffic on its site in Australia, said it would restore news on Australian pages in the coming days.
“This isn’t a must-carry regime,” said Sims. “We never said we’re forcing Facebook to keep showing news.”
SMALL MEDIA, BIG CONCERNS
While the Senate is expected to pass the legislation, with the main opposition Labor Party supporting the ruling Liberal Party, some politicians and media companies have expressed concern about the amendments.
“This changes the bill significantly,” independent senator Rex Patrick, who plans to vote against the amended bill, told Reuters.
“The big players could successfully negotiate with Facebook or Google. The minister then doesn’t designate them, and all the little players miss out.”
Lee O’Connor, owner and editor of regional newspaper The Coonamble Times, agreed the amendments favoured big media groups.
“It’s the vagueness of the language that’s the main concern, and the minister’s discretion is part of that,” O’Connor said.
Frydenberg has said he will give Facebook and Google time to strike deals with Australian media companies before deciding whether to enforce his new powers.
CONTENT DEALS
The code was designed by the government and competition regulator to address a power imbalance between the social media giants and publishers when negotiating payment for news content displayed on the tech firms’ sites.
After first threatening to withdraw its search engine from Australia, Google has instead struck a series of deals with several publishers, including a global news deal with News Corp.
Television broadcaster and newspaper publisher Seven West Media on Tuesday said it had signed a letter of intent to reach a content supply deal with Facebook within 60 days.
Rival Nine Entertainment Co also revealed on Wednesday it was in negotiations with Facebook.
“At this stage, we’re still obviously proceeding with negotiations,” Nine chief executive Hugh Marks told analysts at a company briefing on Wednesday. “It is really positive for our business and positive particularly for the publishing business.”
(Reporting by Colin Packham and Byron Kaye; writing by Jonathan Barrett; editing by Jane Wardell)
By Kane Wu
HONG KONG (Reuters) – Chinese private equity firm Boyu Capital, an investor in Chinese technology titans including billionaire Jack Ma’s Ant Group, is raising a new, China-focused fund targeting as much as $6 billion, three people with knowledge of the matter said.
Its fifth and largest U.S. dollar-denominated fund is likely to close in the near term, said one of the people, who declined to be identified as the information is confidential.
Boyu did not immediately respond to a request for comment.
The fundraising by a firm widely associated with tech startups amounts to a high-profile test of investor appetite at a time when heightened oversight of China’s tech giants clouds the near-term outlook of those companies.
It follows authorities’ November suspension of Ant’s Shanghai and Hong Kong dual listing, which delayed the hefty returns early investors such as Boyu could have expected from the world’s biggest initial public offering (IPO).
The financial technology giant was set to raise $37 billion at a valuation of $315 billion. Since the suspension, China has sharpened oversight of its home-grown champions which has also exposed their investors to more public scrutiny.
A central bank official said Ant’s IPO was suspended to safeguard consumers and investors. Ant has since agreed a restructuring plan with regulators, Reuters reported this month.
ALIBABA AID
Boyu was founded in 2010 by, among others, Alvin Jiang, grandson of former President Jiang Zemin. The firm has offices in Beijing, Shanghai, Hong Kong and Singapore, and invests in consumer and retail, financial services, healthcare and media and technology sectors, its website showed.
It is known for its 2012 investment in Alibaba Group Holding Ltd which helped Ma buy back half of Yahoo! Inc’s 40% stake in the e-commerce firm, Reuters has reported.
At $6 billion, Boyu’s new fund would be one of the region’s largest focusing on China. It last raised $3.6 billion in 2019.
Past investors include Hong Kong’s richest man Li Ka-shing and Singapore state investors Temasek Holdings Ltd and GIC Pte Ltd, Reuters has reported. The New York Common Retirement Fund has also been an investor, showed the website of the state comptroller.
Private equity managers in Asia raised $108 billion for 481 new funds last year, down 45% by dollar value from 2019, showed Preqin data, as the COVID-19 pandemic dampened fundraising.
Activity has picked up in 2021 with $21 billion raised via 56 funds so far, the data showed.
TECH INVESTMENTS
Boyu invested in Ant’s $4.5 billion fundraising in 2016 and $14 billion funding round two years later. In the interim, Ant’s valuation leapt from $60 billion to $150 billion.
The private equity firm has invested in other booming Chinese tech and healthcare startups in recent years that generated lucrative returns，two of the people said.
Portfolio firms include ride-hailer Didi Chuxing, artificial intelligence (AI) firm MegVii and live-streaming app operator Kuaishou Technology, according to media reports and public information.
In January, it participated in a $700 million fundraising by AI firm 4Paradigm, Dealogic data showed.
(Reporting by Kane Wu; Editing by Sumeet Chatterjee and Christopher Cushing)
