Artificial intelligence continues to drive profits this financial year, but its role as a positive catalyst faces major challenges.
3 Biggest Winners of AI Demand Boom to Report Earnings After Close – Amazon
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Super microcomputers and AMD. And Apple will announce Thursday that investors will be keenly watching for updates on the company's AI ambitions.
For Tesla, just the whiff of AI progress was enough to send its stock price soaring. The electric car maker has won approval for an advanced driver assistance system to be used in China. This is an important step towards fully autonomous cars.
But this is a game of prediction. The news came as a rather welcome surprise, as Tesla stock has had a dismal run this year. The same is true, to a lesser extent, of Samsung and Logitech, both of which showed strong demand for AI in their earnings results on Tuesday. Apple stock fell 10% in 2024, but could see a similar rally later in the week.
However, it's a different story when it comes to reporting on the trio after the deal closes. Super Micro Computers, Amazon, and AMD are well-regarded AI winners, with their stocks up 744%, 72%, and 79%, respectively, over the past year.
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This means a high bar, especially for Super Micro, which makes Nvidia-powered AI servers.
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Chips. But Amazon's cloud computing strengths and potential first-ever dividend should help the tech giant overcome lofty expectations.
With inflation proving to be stagnant and Federal Reserve Chairman Jerome Powell poised to reiterate the need to keep interest rates high for an extended period of time after Wednesday's central bank rate decision, The stock market needs a boost from AI now more than ever.
—Callum Keown
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Samsung's profits soar as AI boosts demand for memory chips
Samsung Electronics, the world's largest memory chip and television maker and considered a bellwether in the technology sector, reported a more than quadrupled net profit for the first quarter. Demand for hardware to power artificial intelligence technology is driving a boom in the company's memory chip business.
- Samsung's net profit for the first quarter was 6.755 trillion won ($4.91 billion), up from 1.575 trillion won in the same period last year.quarterly revenue 13% increase.
- Samsung said demand for high-bandwidth memory chips is expected to continue. stay strong Such chips are a necessary component of modern AI processors, such as those from Nvidia.
- Samsung said demand for smartphones was strong, partly due to the launch of the AI-equipped Galaxy S24 during the quarter.Samsung overtook Apple largest smartphone manufacturer According to market research firm IDC, more than 1 million units were shipped worldwide in the first quarter.
What's next: Samsung is currently planning mass production of its new 12-stack HBM3E product in the second quarter, which it claims is its largest capacity high-bandwidth memory chip to date. The company hopes this will help it regain leadership in the sector from domestic rival SK Hynix and US peer Micron Technology.
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—adam clarke
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Paramount Global ousts veterans and names three to CEO position
paramount global
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He severed ties with CEO Bob Bakish in the media company's leadership reorganization, replacing him with a CEO office run by three senior executives as merger talks progress. Board President Shari Redstone said he has great confidence in the new leadership.
- Paramount said CBS President and CEO George Cheeks; Chris McCarthy, President and CEO of Showtime/MTV Entertainment Studios and Paramount Media Networks. and Brian Robbins, CEO of Paramount Pictures and Nickelodeon.work closely together Naveen Chopra, Chief Financial Officer and the Board of Directors.
- The parent company of streaming service Paramount+ is in exclusive merger talks to be acquired by Skydance Media, according to the Wall Street Journal. Apollo Global Management, a major private equity firm, Submits own $26 billion offerin a bid that could involve Sony Pictures.
- Paramount's first-quarter revenue increased 6% from the first quarter of 2023 to $7.69 billion. Direct-to-consumer revenue increased by 24%. Operating loss improved to $417 million from a widening loss in the previous year, and adjusted earnings per share of 62 cents exceeded expectations.
- Paramount+ reported Net new subscribers 3.7 million, totaling over 71 million. Television media revenue increased 1% to $5.2 billion. Film Entertainment revenue increased by 3%, and the film's worldwide box office gross to date has exceeded $275 million. mean girls and Bob Marley: One Love.
What's next: If Paramount is unable to strike a deal, division leaders will cut costs by more than $2 billion, increase investment in content, sell cable networks and Paramount-owned TV stations, and create a streaming joint venture. The company has a plan in place and aims to reduce costs by $14. The Journal reported that it has debts of 1 billion yen.
—Janet H. Cho, Brian Swint, Angela Palumbo
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Regulators investigate Ford's hands-free driving system
Auto safety regulators have turned to Ford Motor Co. to address concerns about the proliferation of hands-free and other self-driving technologies.
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blue cruise system. The National Highway Traffic Safety Administration is investigating after two fatal crashes occurred earlier this year.
- Ford said it is working with regulators and is investigating approximately 130,000 Mustang Mach-Es from the 2021 to 2024 model years. Ford's Blue Cruise is available in some models for hands-free use on most U.S. highways, but Drivers still need to be careful With 100% probability.
- Ford's BlueCruise system includes adaptive cruise control, automatic lane change, driver monitoring system. According to Ford's website, driver-facing cameras are supposed to alert drivers if they're not paying attention to the road, even for a few seconds.
- In both accidents, Mustang Mach-E SUVs collided with stationary vehicles that were located in the freeway's travel lanes at night, resulting in serious injuries. at least one death. NHTSA has determined that a preliminary investigation indicates that each vehicle was engaged by a Blue Cruise prior to the collision.
- More and more automakers are introducing such technology.Regulators are also paying attention
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tesla
'sAutopilot, the most well-known driving assistance system. Over the past 12 months, NHTSA recorded the following: Approximately 1,400 incidents This kind of technology is involved. Tesla reported 1,143 cases. Ford reported 16.
What's next: Investigations like the one initiated here are common and can lead to recalls to improve overall safety. Recalls occur relatively frequently. In the past 12 months, ending in early April, approximately 30 million vehicles were recalled in the United States. That's roughly one-eighth of all vehicles in the United States.
—Janet H. Cho and Al Root
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Activist wins support for Norfolk South board candidate
Activist investor Ancora Holdings has enlisted the help of proxy advisor Glass, Lewis & Co. in its fight to oust Norfolk Southern Railway's board seat and CEO.
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Glass Lewis advised shareholders to vote for six of Ancora's seven candidates and to withhold support for CEO Alan Shaw and board chair Amy Miles.
- Glass-Lewis said Norfolk Southern's operating results have been “consistently worse” than its peers over a long period of time. He also notes that several trade unions support Ancora, questioning management's stance. Relationship with workers. Norfolk South could not be reached for comment.
- Two unions representing 41% of union employees in Norfolk South gained their support Norfolk Southern's coaching schedule for last week. Ancora candidates endorsed by Glass Lewis include former Kansas City Southern executive Sameh Fahmy, former CSX vice president of operations Jamie Boychuk and Jim Barber Jr.
- Ancora disagreed with Norfolk Southern's decision to hire John Orr, former chief transformation officer at Canadian Pacific Kansas City, as chief operating officer.
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cleveland cliffs
,It is also one of the railway's largest customers. supported Ancora's plan CEO Lorenco Gonçalves said this in a letter to investors.
- South Norfolk is also home to Ancora and one of the trade unions that supports it, the Brotherhood of Locomotive Engineers and Railway Workers. fraudulent agreement The railroad claimed that this violated the provisions of the Railway Labor Law. Mr Ancora called the allegations “meritless” and distracting.
What's next: Norfolk Southern's annual general meeting is May 9th. The National Transportation Safety Board's investigation into the February 2023 toxic train derailment in East Palestine, Ohio, is scheduled to conclude in June.
—Janet H. Cho
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Mobile phone companies vow to fight hard over location data
The largest wireless telephone carriers said they intend to fight penalties totaling nearly $200 million handed down by the Federal Communications Commission on Monday. The Federal Communications Commission said both companies shared access to customer location data with aggregators without their consent. This issue resulted from a multi-year investigation.
- The FCC's Division of Enforcement has confirmed that Verizon
,AT&T
,T-mobile
,Sprint then sold access to the data to aggregators, who resold access to the data to third-party location service providers. The regulator also said that carriers: could not be secured There was a valid consent of the customer.
- The FCC began investigating the matter after receiving public reports that customer location information was being disclosed to Missouri state sheriffs through a location service for correctional facilities run by a telecommunications provider. track a person's location.
- Verizon was fined $47 million, AT&T was fined $57 million, and Sprint and T-Mobile, which have merged since the investigation began, were fined more than $12 million and $80 million, respectively. All three companies they said they would appeal order.
- Verizon said it is deeply committed to protecting customer privacy. The order pertains to a program Verizon closed more than five years ago that was meant to support roadside assistance services and medical alerts. Regarding this decision, T-Mobile said: Mistakes and Excessive Fines.
What's next: AT&T said the order unfairly holds carriers liable for other companies' violations of contract requirements, ignores immediate steps taken to address that company's failures, and provides support such as emergency medical alerts and roadside assistance. He said it would “unfairly” punish carriers for their services.
—liz moyer
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—Newsletter editors: Liz Moyer, Patrick O'Donnell, Rupert Steiner