005930.KS - Samsung Electronics Co., Ltd.
| Previous Close | 48,850.00 |
| Open | 48,700.00 |
| Bid | 49,200.00 x 0 |
| Ask | 49,250.00 x 0 |
| Day's Range | 48,600.00 - 49,450.00 |
| 52 Week Range | 41,300.00 - 62,800.00 |
| Volume | 15,058,990 |
| Avg. Volume | 23,539,648 |
| Market Cap | 328.514T |
| Beta (5Y Monthly) | 0.95 |
| PE Ratio (TTM) | N/A |
| EPS (TTM) | N/A |
| Earnings Date | N/A |
| Forward Dividend & Yield | 1,416.00 (2.83%) |
| Ex-Dividend Date | Mar. 30, 2020 |
| 1y Target Est | N/A |
Reuters VideosSamsung heir questioned over controversial deal
South Korean prosecutors questioned Samsung heir Jay Y. Lee on Tuesday (May 26). He was asked about a controversial deal they say may have helped advance his succession plans. The deal involves alleged accounting fraud as well as a widely-criticized merger of two Samsung affiliates. The 2015 merger between Samsung C&T and Cheil Industries, where Lee is a top shareholder, cemented Lee's control over South Korea's top conglomerate. And prosecutors have been investigating suspected accounting fraud at Cheil-owned Samsung Biologics after the country's financial watchdog complained the firm's value had been inflated by over 3 billion dollars ($3.64 billion). A spokesman for Samsung Electronics, where Lee serves as vice chairman, declined to comment. The questioning brings fresh legal trouble for Lee. He faces separate succession-related charges of bribery which involved former South Korean president Park Geun-hye. Lee was released from a yearlong detention over the bribery case back in 2018. And earlier this month, Lee made a rare apology about the bribery scandal. He pledged he would not hand the company founded by his grandfather over to his children.
ABC News VideosSamsung's latest Galaxy phone its biggest ever
Plus, Virgin Orbit to try new satellite launching system and Pac-Man turns 40.
- Bloomberg
Samsung Heir Summoned for Questioning in Succession Probe
(Bloomberg) -- South Korean prosecutors have summoned Samsung Electronics Co. Vice Chairman Jay Y. Lee for questioning in an ongoing investigation into alleged accounting fraud and a controversial 2015 merger of two Samsung affiliates, dealing another legal blow to the country’s largest corporation.While expected, the decision marked a deepening of a long-running probe into the billionaire scion and his shipbuilding-to-smartphones Samsung Group conglomerate. The company’s de-facto leader was called into Seoul Central District Prosecutors Office at 8 a.m. local time Tuesday in relation to allegations over illegal acts in succession plans, the Yonhap News Agency reported. The summons came after the executive publicly apologized over his company’s role in scandals over his succession, which eventually led to the impeachment of former president Park Geun-hye. A spokesman at the agency confirmed Lee has been summoned, without elaborating.Lee has been at the center of a years-long scandal and graft trial that inflamed long-standing resentments against Korea’s most influential family-run conglomerates. He faces renewed charges of using gifts of expensive horses to win favor from the previous administration, which he has denied. The legal fight has disrupted his tenure at the helm of Samsung Electronics, the world’s leading producer of smartphones and memory chips. This month, the billionaire took the unusual step of apologizing for his role in the controversy, pledging his children would never run the conglomerate.“I give my word here today that from now on, there will be no more controversy regarding succession. There will absolutely be no infringement against the law,” Lee said at a hastily convened press conference at the time. “There will be no leaning on legal expediency or actions that cause ethical reproach. My sole focus will be on enhancing the corporate value of Samsung.”Read more: Samsung Heir Vows an End to Family Rule After Succession ScandalThe prosecutors office’s probe, which is separate from the corruption trial, centers on whether there were illegal acts during a merger between Samsung C&T Corp. and Cheil Industries -- the conglomerate’s de-facto holding company. That deal was regarded as an effort to cement Lee’s control over the conglomerate, which he has run since his father suffered a heart attack in 2014. Prosecutors are also likely to interrogate the heir about allegations of financial fraud at Samsung Biologics Co. The agency hasn’t brought any charges in the case so far. A Samsung Electronics spokeswoman declined to comment on Tuesday.Read more: The Never-Ending Trial Between a Billionaire Heir and His NationSamsung Group, South Korea’s largest conglomerate with more than $400 billion of market value, has grappled with legal issues for years. Dozens of current and former executives have been questioned, indicted or arrested over charges that range from graft and accounting issues to union-busting. Lee was imprisoned for about a year until his release in early 2018, then returned to court for a retrial last year when the scope of the alleged wrongdoing was revised. He again faces the possibility of jail.The current prosecutors’ probe kicked off after the country’s Financial Services Commission in 2018 said Samsung’s biotechnology unit “intentionally” violated accounting rules surrounding an initial public offering. The regulator said at the time the unit deliberately overstated the value of Samsung Bioepis Co. ahead of its 2016 IPO. Critics argued that Samsung Group orchestrated the accounting change to benefit the merger of Samsung C&T and Cheil Industries, which made Lee the largest shareholder at Samsung’s de-facto holding company and bolstered his succession plans.Samsung Biologics has denied the allegations and said its books were examined by external accounting firms, and that it had no impact on the 2015 merger as that was completed before the bio firm’s accounting change.(Updates with Samsung’s response in the fifth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
Japan’s Hottest Stock Is Tiny Maker of $40 Million Machines
(Bloomberg) -- The list of Intel Corp.’s annual supplier award winners tends to read like a who’s-who of the semiconductor industry’s biggest names. This year, it included a little-known Japanese company whose machines have become indispensable in the race to improve semiconductors and whose stock has been rocketing up as a result.Lasertec Corp. is the world’s only maker of testing machines required to verify chip designs for the nascent extreme ultraviolet lithography (or EUV) method of chipmaking. In 2017, Lasertec solved a key piece of the EUV puzzle when it created a machine that can inspect blank EUV masks for internal flaws. Last September, it cleared another milestone by unveiling equipment that can do the same for stencils with chip designs already printed on them. This March, Intel gave the tiny Yokohama-based company an award for innovation, its first after decades of doing business together.“That’s a major milestone for us,” Lasertec President Osamu Okabayashi said in an interview. “It means a lot to be recognized this way as a supplier.”The company’s stock has soared about 550% since the start of 2019, more than twice the gain of the second-best-performing security in the benchmark Topix index. Shares increased about 4% Tuesday, pushing its rise this year to more than 60%.Intel declined to say if it was buying EUV equipment from Lasertec, which already supplies test gear to its rivals Samsung Electronics Co. and Taiwan Semiconductor Manufacturing Co. The three chip fabricators are the only ones so far to announce EUV plans, because the technology is so complex and expensive. Okabayashi would only say that his company has “two or more” EUV customers.“This can be read as a sign that Lasertec’s tools are indispensable to Intel’s EUV roadmap.” said Damian Thong, an analyst at Macquarie Group Ltd.Read more: Japan’s Star Electronics Stock Will Be Vital to Intel, SamsungEUV is just entering the mass production phase after two decades in development, but investors are already betting Lasertec will be one of the key beneficiaries. The move to EUV overcomes key hurdles to shrinking manufacturing geometries of semiconductors, allowing more and smaller transistors to be crammed onto silicon. It promises to unleash another wave of gadgets that are slimmer, cheaper and more powerful.Last month, Lasertec raised its annual order forecast for the second time this year to 85 billion yen ($789 million) in the period ending June, nearly double the amount it received in fiscal 2019. The company is headed for the fourth straight year of record revenue and profits. Sales will climb 39% to 40 billion yen and profit will jump 76%, according to its estimates. And that’s likely to be just the beginning.Samsung earlier this month said it is building a 5-nanometer fabrication facility that will use EUV to make processors for applications ranging from 5G networking to high-performance computing from the second half of next year. Taiwan’s TSMC is pushing ahead with plans to adopt 3-nanometer lithography mass production in 2022 and announced plans to build an advanced fab in the U.S. Intel’s first product made using EUV is expected late next year.Their primary focus is on so-called logic processors, used to power devices and networking applications, but the new manufacturing technique will eventually filter through into the production of DRAM and other memory chips.Read more: Samsung Takes Another Step in $116 Billion Plan to Take on TSMC“Logic makers will be first to adopt EUV, with memory makers following later,” Okabayashi said. “The real volume of orders will come when they reach mass production stage. Right now it’s 7- and 5-nanometer chips. 3-nanometer is still in development stage.”Okabayashi expects each customer will probably need several of his testers, which could cost well over $40 million apiece and take as long as two years to build. A chipmaker would need at least one machine in its mask shop to make sure the stencils come out right. Another would go into a wafer fab to keep an eye on the microscopic wear and tear that result from concentrated light being projected repeatedly through the chip design stencils.“Lasertec is still trying to get a feel for this market and how big it can be,” Macquarie’s Thong said. “Their stock is moving on expectation of future orders. But there is little actual visibility on the scale of this market, so Lasertec retains a lot of capacity for surprise.”(Updates with share price in fourth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
Huawei Wants Stable Samsung, Hynix Chip Supply, Korea Daily Says
(Bloomberg) -- Huawei Technologies Co. has sought high-level assurances from Samsung Electronics Co. and SK Hynix Inc. they will continue to supply memory chips despite mounting pressure from the U.S. to isolate the Chinese telecommunications company, the Korea Economic Daily reported.The Shenzhen-based company called in senior officials at the two South Korean chipmakers’ Chinese units to ensure a stable supply of the semiconductors regardless of recent U.S. government restrictions, the report said, citing unidentified industry sources. Representatives for the two Korean companies denied the report on Monday as Samsung said such meetings had not taken place, while Hynix didn’t elaborate.Huawei is one of the five biggest clients for Samsung and SK Hynix, spending around 10 trillion won ($8.1 billion) to buy DRAM and NAND flash memory chips from the Korean companies every year, the newspaper said. The report comes amid rising pressure against global suppliers after U.S. President Donald Trump barred any chipmaker using American equipment from supplying Huawei without U.S. government approval.While memory chipmakers aren’t subject to the U.S. government restrictions, Huawei worries that the Trump administration could widen its restrictions later, according to the report.As the two South Korean companies supply more than 70% of the DRAM chips globally, including them in any U.S. action would threaten the survival of the Chinese company, said the newspaper. It cited an industry official it didn’t identify as saying that Huawei is quickly building its memory-chip inventory in preparation for a worsening scenario.(Updates with Hynix and Samsung’s responses from the second 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.
- Reuters
Samsung Electronics builds sixth domestic contract chip-making line
Samsung Electronics Co Ltd has begun work on a sixth domestic contract chip production line, the company said on Thursday, to make logic chips for mobile phones and computers as it looks to cut reliance on the volatile memory chip sector. The South Korean firm is taking on bigger rival Taiwan Semiconductor Manufacturing Co Ltd (TSMC) in the contract manufacturing business, where it competes for orders from customers such as Qualcomm Inc . "This new production facility will expand Samsung’s manufacturing capabilities," the company said in a statement on Thursday.
- Bloomberg
Samsung Takes Another Step in $116 Billion Plan to Take on TSMC
(Bloomberg) -- Samsung Electronics Co. has begun building a cutting-edge chip production line intended to help it take on Taiwan Semiconductor Manufacturing Co. in the business of making silicon for external clients.South Korea’s largest company said it’s started construction on a 5-nanometer fabrication facility in Pyeongtaek, south of Seoul, dedicated to its made-to-order foundry business, an arena TSMC dominates. Based on the Extreme Ultraviolet Lithography or EUV process, Samsung expects the fab’s output to go toward applications from 5G networking to high-performance computing from the second half of 2021, it said in a statement.Samsung, the world’s largest maker of computer memory, smartphones and displays, in 2019 outlined its aim of spending $116 billion to compete with TSMC and Intel Corp. in contract chipmaking, making silicon for customers like Qualcomm Inc. or Nvidia Corp. Its announcement on Thursday coincides with the announcement of restrictions on the sale of semiconductors made with American gear to China’s Huawei Technologies Co., a constraint that threatens more than a tenth of TSMC’s business.“This will enable us to break new ground while driving robust growth for Samsung’s foundry business,” ES Jung, head of the contract chipmaking division, said in a statement.Read more: Behind Samsung’s $116 Billion Bid for Chip SupremacySamsung first unveiled its expansion blueprint in April 2019, outlining at the time its goal of hiring thousands and ramping up investment in logic chips in the years leading up to 2030. That initiative arose as sales of smartphones and consumer electronics plateaued and competition from Chinese rivals depressed margins.EUV is the latest and most advanced chipmaking method, requiring machines costing tens of millions of dollars and delivering better precision and performance in the chips it produces. TSMC and Samsung, through its spending plan, are the leaders in developing that process and expanding into 5nm and smaller manufacturing nodes.Before the arrival Covid-19, Samsung had begun collaborating with major clients on designing and manufacturing custom chips and that work was already starting to add to its revenue, a Samsung executive has said. The company’s newest fab in Pyeongtaek joins another 5nm facility in Hwaseong that will begin production in the second half of 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.
- Bloomberg
Sony, Microsoft Strike Deal on Tiny AI Chip With Huge Potential
(Bloomberg) -- Sony Corp. and Microsoft Corp. have partnered to embed artificial intelligence capabilities into the Japanese company’s latest imaging chip, a big boost for a camera product the electronics giant describes as a world-first for commercial customers.The new module’s big advantage is that it has its own processor and memory built in, which allows it to analyze video using AI tech like Microsoft’s Azure, but in a self-contained system that’s faster, simpler and more secure to operate than existing methods.The two companies are appealing to retail and logistics businesses with potential uses like optimizing warehouse and factory automation, quantifying the flow of customers through stores and making cars smarter about their drivers and environment.At a time of increasing public surveillance to help rein in the spread of the novel coronavirus, this new smart camera also has the potential to offer more privacy-conscious monitoring. And should its technology be adapted for personal devices, it even holds promise for advancing mobile photography.Read more: Sony Releases Faster Camera Sensors With Integrated AIInstead of generating actual images, Sony’s AI chip can analyze the video it sees and provide just metadata about what’s in front of it -- saying instead of showing what’s in its frame of vision. Because no data is sent to remote servers, opportunities for hackers to intercept sensitive images or video are dramatically reduced, which should help allay privacy fears.Apple Inc. has already proven the efficacy of combining AI and imaging to create more secure systems with its Face ID biometric authentication, powered by the iPhone’s custom-designed Neural Engine processor. Huawei Technologies Co. and Alphabet Inc.’s Google also have dedicated AI silicon in their smartphones to assist with image processing. These on-device chips represent what’s known as edge computing: handling complex AI and machine-learning tasks at the so-called edge of the network instead of sending data back and forth to servers.“We are aware many companies are developing AI chips and it’s not like we try to make our AI chip better than others,” said Hideki Somemiya, senior general manager of Sony’s System Solutions group. “Our focus is on how we can distribute AI computing across the system, taking cost and efficiency into consideration. Edge computing is a trend, and in that respect, ours is the edge of the edge.”Sony’s advance is to eliminate the need for transfers within the device itself. Whereas Apple and Google still use conventional image sensors that convert light particles into computer-readable image formats for their chips to read, Sony’s new part is capable of doing the analytical work without any data leaving its physical boundaries.The AI-capable sensor may also help advance augmented reality applications. The two U.S. giants, whose iOS and Android operating systems control practically the entire smartphone market, are heavily invested in AR development. Google Maps now offers the option to show 3-D directions atop a video feed of a user’s surroundings while Apple is planning new 3-D cameras on its next set of iPhones in the fall. The agenda-setters of the mobile industry are looking for ever smarter mobile cameras, spurring the demand for more sophisticated imaging gear.Read more: Google Delivers an Answer to Apple on Augmented RealitySony already enjoys a substantial lead as the world’s foremost provider of image sensors, counting Apple, Samsung Electronics Co. and every major Chinese smartphone maker among its customers along with pro camera stalwarts like Hasselblad V, Fujifilm Holdings Corp. and Nikon Corp.Its next set of customers may be automakers.The AI-powered Sony sensor is capable of recording high-resolution video and simultaneously conducting its AI analysis at up to 30 frames each second. That rapid, up-to-the-microsecond responsiveness makes it potentially suitable for in-car use such as detecting when a driver is falling asleep, Sony’s Somemiya said. Without the need for a “cloud brain” as some existing systems have, Sony’s AI sensor could hasten the adoption of smart-car technology.”This on-chip approach enables a system design to be more flexible and even optimized, given that the cost of image processing, which is one of the most compute-intensive tasks for autonomous driving, can be offloaded from an electronic control unit,” said Shinpei Kato, founder and chief technology officer of Tokyo-based Tier IV Inc., which develops self-driving software.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.
- Thomson Reuters StreetEvents
Edited Transcript of 005930.KS earnings conference call or presentation 29-Apr-20 1:00am GMT
Q1 2020 Samsung Electronics Co Ltd Earnings Call
- Bloomberg
Asia’s Broadest Stocks Recovery Is Taking Hold in Korea
(Bloomberg) -- South Korea is not only one of the markets that’s recovering the fastest from the impact of the coronavirus pandemic, it’s also showing one of the broadest rebounds.The benchmark Kospi index has almost 35% of its members trading above their 200-day moving average, returning to levels last seen in mid-February, just before an explosion of virus cases in the country. That’s ahead of the 30% of stocks trending higher in the wider MSCI Asia Pacific Index, according to data compiled by Bloomberg.The Kospi has rallied about 33% from a decade low in March, with only seven of its almost 800 members posting a decline in that time. The index is also one of the top performers among major equity markets in Asia and well ahead of the regional benchmark’s 20% rally since its low. The South Korean index climbed 0.6% Monday.The market breadth of South Korea’s rally is especially evident given its largest member, Samsung Electronics Co., has risen only 15% from its March trough. The coronavirus crisis has been a net negative for global chipmakers, hampered by lower consumer demand for new PCs and smartphones despite greater interest in online services amid the lockdowns.Read: Samsung Has Yet to Fully Join Korea’s Stellar JumpThere may be even more room to run for South Korean equities as President Moon Jae-in pushes through significant fiscal spending plans to jump start the economy. And given the country’s strong record of fiscal management, it is in a position to get very aggressive on this front, Justin Jimenez, an economist with Bloomberg Economics, wrote in a report Monday.In a base case, Bloomberg Economics estimates South Korea’s debt-to-gross domestic product ratio would rise to about 44% this year and 46% in the next, up from 37% in 2019, according to government figures. Even in a more dire situation where additional fiscal support is needed, pushing the ratio to 50% of GDP by 2021, that would still be well below the G-20 average of 84% last year, Jimenez said.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.
- Reuters
SK Hynix shares fall on demand worries after U.S. curbs on Huawei chip supply
Shares of South Korea's SK Hynix , the world's No.2 memory chip maker and supplier to Huawei [HWT.UL], fell as much as 3.3% early on Monday after a U.S. move to curb semiconductor supplies to the Chinese company stoked fears about a demand hit. The U.S. Commerce Department said on Friday that foreign companies that use U.S. chipmaking technology will be required to obtain a U.S. license before supplying certain chips to Huawei, a maker of smartphones and telecoms equipment. The rules specifically target chips designed by Huawei and its affiliates, including chip-design unit HiSilicon and manufactured using U.S. technology.
- Bloomberg
TSMC Plans $12 Billion U.S. Chip Plant in Victory for Trump
(Bloomberg) -- Taiwan Semiconductor Manufacturing Co. plans to spend $12 billion building a chip plant in Arizona, a decision designed to allay U.S. national security concerns and shift more high-tech manufacturing to America.TSMC said Friday it will start construction of its next major fabrication facility in 2021, to be completed by 2024. While the investment falls short of its previous expenditure on cutting-edge factories, it’s a shift for a company that now makes semiconductors for major names like Apple Inc. and Huawei Technologies Co. mainly from its home base of Taiwan.As the world’s largest and most advanced maker of chips for other companies, TSMC plays a crucial role in the production of devices from smartphones and laptops to servers running the internet. Its decision to situate a plant in the western state comes after White House officials had warned repeatedly about the threat inherent in having much of the world’s electronics made outside of the U.S. TSMC had negotiated the deal with the administration to create American jobs and produce sensitive components domestically for national security reasons, according to people familiar with the situation.The Asian chipmaker’s U.S. investment underscores the delicate balance it needs to strike between its huge roster of American clients and China, which views independently governed Taiwan as part of its territory. Beijing’s ambition of creating a world-class domestic semiconductor industry has unnerved Washington, which fears the country’s technological ascendancy may pose a longer-threat. Executives at TSMC, which operates plants in Nanjing and Shanghai and makes chips that go into everything from 5G networks to American fighter jets, have emphasized the company is neutral.“The scale & technology is similar to what TSMC did in China, suggesting a balance between the U.S. & China,” Sanford C. Bernstein & Co. analysts led by Mark Li wrote after the announcement. “Overall, this is probably the minimal price to stay neutral. TSMC needs both U.S. & China to maintain scale & stay competitive and this is probably the minimal cost to keep this strategy.”Read more: Huawei Warns of ‘Pandora’s Box’ If U.S. Curbs Taiwan SupplyThe envisioned facility represents a small step in global industry terms. Upon completion, it will crank out 20,000 wafers a month, versus the hundreds of thousands that TSMC’s capable of from its main home base. And it will employ 5-nanometer process technology, a current standard that will likely become a few generations old by the time output begins in a few years.The higher cost of operating in America may have been a factor ahead of the decision. A true cutting-edge fab is expensive to build: The company spent NT$500 billion ($17 billion) to build an advanced facility in the southern Taiwanese city of Tainan that will supply new iPhones this year. It plans another $16 billion in capital spending in 2020. The Arizona plant still requires approval from TSMC’s board, which may hinge on incentives.“There is a cost gap, which is hard to accept at this point. Of course, we have -- we are doing a lot of things to reduce that cost gap,” TSMC Chairman Mark Liu said on a recent analyst conference call.U.S. Won’t Tolerate Tech Fence-Sitters Any Longer: Tim CulpanIf the federal government provides cash for a U.S. plant, it’ll mark a shift in policy and rhetoric from a Republican administration. Trump’s White House has rarely supported such direct industrial intervention, favoring market dynamics. A similar government-backed effort with Foxconn -- Apple’s main iPhone assembler -- in Wisconsin has so far not created as many jobs as expected.However, emerging trends may be forcing a reconsideration. The U.S. government is already giving or lending billions of dollars to keep companies afloat in the midst of a pandemic-fueled recession. The crisis has also highlighted how vulnerable global supply chains are to such shocks.The White House may also be motivated by broader political factors. Trump has attacked international trade deals and tried to limit China’s access to semiconductor technology, seeking to contain the country’s technological ascent. TSMC said its Arizona facility will create 1,600 jobs and a deal to bring highly skilled work to Arizona may help Trump’s re-election prospects this year.“TSMC’s plan to build a $12 billion semiconductor facility in Arizona is yet another indication that President Trump’s policy agenda has led to a renaissance in American manufacturing and made the United States the most attractive place in the world to invest,” U.S. Secretary of Commerce Wilbur Ross said in a statement.By producing chips for many of the leading tech companies, TSMC has amassed the technical know-how needed to churn out the smallest, most efficient and powerful semiconductors in the highest volumes. It manufactures important components designed by Apple and most of the largest semiconductor companies, including Qualcomm Inc., Nvidia Corp., Advanced Micro Devices Inc. and China’s Huawei. Shares of Applied Materials Inc., Lam Research Corp. and KLA Corp. rose on optimism that these U.S.-based providers of chipmaking equipment may face fewer export controls when supplying TSMC.Concentrating such valuable capabilities in the hands of one company in Asia is a concern for the U.S., especially when, across the Strait of Taiwan, China is rushing to develop its own semiconductor industry.TSMC’s local rival, GlobalFoundries Inc., has given up on advanced manufacturing and Intel Corp., the world’s largest chipmaker, mainly manufactures for itself. Its attempt to become a so-called foundry for external clients has failed to gain major customers. TSMC’s only other significant challenger is South Korea’s Samsung Electronics Co., which is investing more than $116 billion in its effort to keep up with the leader.“TSMC welcomes continued strong partnership with the U.S. administration and the State of Arizona on this project,” the company said in a statement. “This project will require significant capital and technology investments from TSMC. The strong investment climate in the United States, and its talented workforce make this and future investments in the U.S. attractive to TSMC.”Read more: Foxconn Factory Subsidy Estimate Slashed by Wisconsin Agency(Updates with analyst’s comment from the fourth paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
Tencent’s Absence Is a Drag for Lagging Asia Tech Stocks
(Bloomberg) -- U.S. technology stocks are on their hottest winning streak of the year, yet those gains aren’t necessarily translating to the same boost for their peers in Asia.The tech benchmark Nasdaq 100 Index, heavily skewed toward the so-called FAANG stocks -- Facebook Inc., Apple Inc., Amazon.com Inc., Netflix Inc., Google parent Alphabet Inc. -- as well as top position Microsoft Corp., has now rallied for six straight days. It has rebounded 33% since a low in March as investors piled into technology and biotech shares seen as winners amid the social-distancing lockdowns of the coronavirus pandemic.Read: Nasdaq’s Resilience Pushes Benchmark Dominance to 20-Year HighThere’s no equivalent tech mainboard in Asia, with the MSCI Asia Pacific Information Technology Index the closest comparable. It’s up a comparatively weak 24% since mid-March, and the top stocks in the gauge, Taiwan Semiconductor Manufacturing Co. and Samsung Electronics Co., have lagged that gain. Tencent Holdings Ltd., the online gaming and social-media services giant that analysts expect will report Wednesday an 18% revenue increase amid the virus outbreak, isn’t part of that index.While the top of the Nasdaq 100 enjoys a more diverse mix -- Google, Netflix and Facebook leveraging demand for online and social-media services from consumers stuck at home, alongside Amazon’s online delivery -- the Asia Pacific index is largely dominated by chipmakers TSMC and Samsung. They account for more than a third of the gauge.The coronavirus pandemic has been a net negative for chipmaker stocks worldwide. Despite growth in data centers, they’ve been hit by concerns about lower end-market demand for new personal computers, smartphones and autos, Bloomberg Intelligence analysts Anand Srinivasan and Marina Girgis wrote in a May 1 note.Tencent not being part of the Asia Pacific tech index is also hurting it. After falling less than its peers during the initial market downturn, the stock is up 14% for the year, climbing to a two-year high on Monday.Global mobile game sales hit a record for the week ended May 3, according to Sensor Tower, with holidays in China and Japan also helping gains, BI’s Matthew Kanterman and Vey-Sern Ling wrote in a note Monday. “Growth should continue above the long-term market potential for the duration of the pandemic, likely through 2Q,” they said.Tencent was also included as a “select stock pick” as internet, health-care and property sectors are among those to benefit from China’s upcoming National People’s Congress, Citigroup Inc. analysts including Pierre Lau wrote in a May 11 note.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
U.S. Won’t Tolerate Technology Fence-Sitters Any Longer
(Bloomberg Opinion) -- Ever since Donald Trump fired the first shot in the U.S. trade war with China, one technology company has been sitting in the middle, trying to avoid the crossfire. It’s wonderful to be able to sell weapons to all sides, until one forces you to choose.Taiwan Semiconductor Manufacturing Co. is in the enviable position of being a critical supplier to both countries. The company, headquartered in famed Hsinchu Science Park, makes the world’s most advanced chips for the likes of Apple Inc., Qualcomm Inc., Nvidia Corp. and Huawei Technologies Co. The U.S. fear, as portrayed by the White House, Pentagon and Commerce Department, is that allowing China to procure the world’s best semiconductors while America is unable to make them at home is an urgent and critical national security threat. That’s spurred a two-pronged strategy in recent years: Limit Chinese access to and development of chip technology, and bolster domestic prowess.TSMC’s strategy has been to stay neutral. It has most of its capacity in Taiwan, one new and one not-so-new factory in China, and an old facility in Washington state. A year ago, I wrote that chairman Mark Liu had politely pushed back against pressure to expand in America, citing the steep costs. I concluded: “TSMC won’t be able to sit on the fence forever. While Liu may want to just make chips, he’ll eventually have to make a choice.”That day has come. The coronavirus pandemic has highlighted Washington’s need to protect supply chains from disruption, and heightened concerns about reliance on Taiwan, as the Wall Street Journal reported over the weekend. To that end, the administration is pushing hard to get chipmakers, including Intel Corp., TSMC and Samsung Electronics Co., to expand in the U.S., and to use their best technology, the WSJ wrote.Unsurprisingly, Intel is making the case that the U.S. should strengthen its domestic production for “geopolitical” reasons. The company has most of its staff, and more than half its plants and equipment, in the U.S., including manufacturing in Arizona, New Mexico and Oregon.While best-known for supplying processors used in PCs and servers under its own name, Intel also operates a foundry business that does contract manufacturing using clients’ own designs. Once the world leader in chip production, the Santa Clara, California-based company has fallen behind and now trails TSMC and South Korea’s Samsung.Intel clearly sees an opportunity. If it can convince defense and commerce officials that it’s in the interest of national security to mandate that at least some chips be made domestically, then it may have a shot at getting back into the foundry game. TSMC has been trying to push back, or at least to get a seat in the policy discussions. It recently hired former Intel lobbyist Peter Cleveland to coordinate its efforts in Washington. As the old saying goes, “If you’re not at the table, then you’re on the menu.”But the other aspect of American strategy may be harder for the Taiwanese company to negotiate. Beyond expanding domestic capacity, Washington wants to limit Chinese access. To do so, the Trump administration is considering new rules to curb the use of U.S. equipment and materials in making chips for the likes of Huawei, arguing that the Chinese company is a conduit for Beijing’s espionage.That’s put TSMC and numerous other companies in a difficult position. The American market accounted for 59% of its sales last year, against 19% for Chinese clients. Yet the growth momentum clearly favors the world’s largest country, which is focused on developing components used in artificial intelligence, 5G communications, surveillance and possibly weaponry. TSMC has attempted to play Switzerland. A year ago, the company was sticking with the line that “We are everybody’s foundry.”Washington increasingly wants TSMC to be its foundry alone. Pressure has ramped up significantly over the past year, with the long list of U.S. clients and significant revenue contribution being used as a battering ram to make the point that America is the side to choose. Ten years ago, when Taipei-Beijing relations were friendlier, companies may have leaned toward China. Today, with China showing increasing belligerence and the U.S. supporting a greater global voice for Taiwan, the mood has shifted.It’s true that China is an important and growing market — Beijing has used that momentum to bring global companies to its shores — yet it won’t replace the U.S. in terms of size or technology leadership in the next 20 years. To assuage concerns, and win a reprieve on restrictions about supplying to China, TSMC has little choice but to offer something to the Americans. After years of delay and resistance, it’s time for TSMC to build a shiny new factory in America. Expect to hear the company announce concrete plans, and large dollar figures for U.S. investment, in the next year or so.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Tim Culpan is a Bloomberg Opinion columnist covering technology. He previously covered technology for Bloomberg News.For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
U.S. Poised to Let Companies Join Huawei in Setting Standards
(Bloomberg) -- Regulators are moving to let U.S. companies participate in technology standards-setting bodies alongside Huawei Technologies Co., despite the Chinese firm being blacklisted in the U.S. over security concerns.The Commerce Department is writing a regulation to make clear that restrictions on dealing with Huawei don’t bar involvement in international processes in which the Shenzhen-based maker of telecommunications equipment also is taking part, said two people briefed on the matter.The rule could be released within days for a review by other agencies and may not be final for some time, said the people who asked not to be identified because the change hasn’t been made public.The Commerce Department declined to comment.The Trump administration last year said it would cut off Huawei’s access to crucial American components, and has waged a campaign to get allies to shun the company’s telecom equipment because it is a security risk. Huawei has denied it is a security risk.Standards-setting bodies designate technology to be used widely in manufacturing, for instance ensuring that photos from a Samsung Galaxy phone can be viewed on an Apple iPhone.Tech advocates have said shifting rules have led U.S. companies to shun some standards-setting forums.“Confusing and unclear U.S. policies have inadvertently caused many U.S. companies to lose their seat at the table to competitors from other countries, namely China,” said Naomi Wilson, senior director of policy for the Information Technology Industry Council, a policy group that includes Qualcomm Inc. and Intel Corp. as members. “It is critical that the U.S. Department of Commerce address these ambiguities.”Doug Brake, telecom policy director for the Information Technology and Innovation Foundation, said U.S. companies’ participation “is crucial to making sure American technology is incorporated in basic technology around the world.”Six U.S. senators in an April 14 letter raised the issue, saying they were concerned about “risks to the U.S. global leadership position in 5G wireless technology.”For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Reuters
After surprise apology, Samsung heir pressed to explain family's intentions
Samsung Group heir Jay Y. Lee's vow to end dynastic succession at South Korea's biggest conglomerate following three generations of family control sparked skepticism in some quarters and worry in others for the future of the country's corporate champions. Lee made the surprise announcement on Wednesday saying he would not pass the company founded by his grandfather in 1938 to his children. Lee's announcement, however vague, sent shockwaves through South Korea's corporate elite, dominated by a handful of families who run business empires known as "chaebol" that wield huge political and economic power Asia's fourth-largest economy.
- Bloomberg
Apple Maintains Lead After Smartwatches Defy Global Sales Slump
(Bloomberg) -- Apple Inc. again commanded a majority share of the smartwatch market in the first quarter, when the Covid-19 outbreak encouraged health tracking and drove a 20% rise in shipments.Global smartwatch shipments reached 13.7 million units in the first three months of this year, defying a worldwide slump in consumer electronics arenas such as mobile phones. Apple’s share inched up a percentage point to 55.5%, according to Strategy Analytics.The Apple Watch is seen as one of the key growth drivers for the U.S. company, which has stopped detailing quarterly iPhone shipments as the smartphone market matures. Compal Electronics Inc. and Quanta Computer Inc. are the Cupertino, California giant’s assembly partners for the wearable device, according to GF Securities analyst Jeff Pu.Strategy Analytics notes that Apple achieved its highest market share in two years after shipping 7.6 million units. Samsung Electronics Co. was second with 1.9 million and Garmin Ltd. rounded out the top three with 1.1 million.“We expect global smartwatch shipments to slow sharply in the second quarter of 2020, due to the ongoing Covid-19 pandemic,” said Woody Oh, a director at Strategy Analytics. “However, the second half of this year and beyond will see a decent rebound, as consumers worldwide steadily regain confidence and more retail stores reopen.”Read more: Demand for Health Gadgets Surges in Lockdown, Likely to LastFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
Samsung Billionaire Apologizes for Succession Scandal
(Bloomberg) -- Jay Y. Lee, the billionaire scion of Samsung Group, issued a personal apology for his company’s role in a scandal over succession that rocked South Korea and promised not to hand down leadership to his children, signaling he will likely be the last of his family to oversee the country’s most powerful conglomerate.Speaking at a briefing at company headquarters, Lee admitted missteps in the past and pledged he will avoid violations of the law in the future. His promise means that leadership of Korea’s largest conglomerate, which was founded by his grandfather and then led by his father, won’t get passed to a fourth generation.“We are recognized for our top-class technology and products, but the public view of Samsung is still critical,” the 51-year-old said, dressed in a dark suit, white shirt and tie. “This is all because of our shortcomings. This has been my fault and I offer my sincere apology.”Lee has been entangled for years in allegations that he used horses and financial contributions to win favor, via an intermediary, from then-president Park Geun-hye to help with his succession as Samsung chief. The scandal led to Park’s impeachment in 2017 and her sentencing to a 25-year prison term. It also inflamed public anger over the power of the country’s conglomerates, triggering the election of a reformer as her successor. The executive’s apology may help burnish Samsung’s image, which improved after the electronics giant publicized a series of efforts to aid Korea in its battle against Covid-19.The legal fight has disrupted Lee’s tenure at the helm of Samsung Electronics Co., the world’s leading producer of smartphones and memory chips. He became de-facto leader after his father suffered a heart attack in 2014, but he was then imprisoned for about a year until his release in early 2018. Lee returned to court for a retrial last year when the scope of the alleged wrongdoing was revised, and he again faces the possibility of jail.“I give my word here today that from now on, there will be no more controversy regarding succession. There will absolutely be no infringement against the law,” Lee said. “There will be no leaning on legal expediency or actions that cause ethical reproach. My sole focus will be on enhancing the corporate value of Samsung.”Lee’s tone was markedly different from the past. He and Samsung had insisted repeatedly that they had done nothing wrong.”It is symbolic that Korea’s top company will separate ownership from management,” said Park Ju-gun, president at corporate watchdog CEOScore.Lee also apologized for Samsung’s stance against unions, a long-running area of controversy.“At Samsung, the labor culture did not move in step with the times,” he said. “From now on, I will make sure that Samsung is not criticized for ‘union-free management’.”Samsung C&T Corp., the de facto holding company for the Samsung empire, surged 6.6%, well ahead of the Korean market index.”Samsung C&T shares rose on expectations that Lee may not go back to jail again, relieving uncertainties over trial issues,” said Lee Sang-hun, senior analyst at HI Investment & Securities. “Through today’s presser, Lee showed his leadership and sought to boost corporate image.”The appeals court that decided to release Lee is expected to rule on his final sentence in the next few months. Unless new evidence emerges during the retrial, the appeals court is expected to rule in line with the decision of Korea’s Supreme Court, which found Lee had used the horses and money to bribe President Park while seeking political support. This would mean altering Lee’s presently suspended prison sentence.Why the Fate of Samsung’s Billionaire Heir Turns on HorsesThe total amount of alleged bribery determined by the top court carries a minimum sentence of five years, which cannot be suspended in the same way that Lee’s existing sentence had been. Media coverage in Korea, however, has centered on Article 53 of the Korean Criminal Act, which stipulates there could be a discretionary mitigation of the punishment “when there are extenuating circumstances.” In Lee’s case, the damage to Samsung -- crucial as it is to Korea’s economy -- could be presented as grounds to keep him out of prison.Samsung Billionaire Heir to Cede Board Seat Before Legal ProbeLee gave up on extending his three-year term on the Samsung board. Although he’s keeping his title as vice chairman, it will be the board that drives overall management decisions, people familiar with the matter have said.Park of CEOScore said that Lee has been under pressure to apologize and demonstrate contrition after the years of scandal.“Lee himself has been struggling with succession under Korean law,” Park said. “But today’s announcement was weak. He didn’t say he’d take away the Lee family ownership at Samsung.”(Updates with outside comment from eighth 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.
- Reuters
Samsung heir Lee apologises over succession, won't hand control to children
Samsung Group heir Jay Y. Lee, embroiled in a bribery scandal, on Wednesday made a rare apology over controversial succession plans and said he will not hand over management rights to his children at the family-controlled conglomerate. Lee's remarks come after Samsung Group's oversight panel in March advised him to apologise over the handling of succession, labour and others issues, and pledge to prevent any repeat of governance violations.
- Yahoo Finance
Korean baseball's return is a bitter pill for American sports, but a win for ESPN
While sports remain shut down in the U.S., pro baseball is starting up again in South Korea—and ESPN bought the rights to air the games.
- Bloomberg
Hong Kong Oil ETF’s Broker Refuses to Let It Buy Futures
(Bloomberg) -- The manager of a $500 million oil exchange-traded fund said its broker refused to let it increase holdings of crude futures, a sign of continued risk aversion in global oil markets after last month’s historic plunge below zero.As a result of the broker’s ultimatum, the Samsung S&P GSCI Crude Oil ER Futures ETF will halt issuance of new shares starting Monday. The Hong Kong-traded fund also bought put options to protect against negative oil prices and will adjust its existing futures positions, moving from a 100% weighting in September West Texas Intermediate contracts to an equal weighting in September, October and December.Samsung Asset Management (Hong Kong) Ltd., which disclosed the moves in a filing to the Hong Kong stock exchange, said it’s in “active discussions” to find a new broker. It didn’t disclose the name of the existing one.Unprecedented oil-market volatility has wreaked havoc on ETFs and other products designed to give investors an easy way to bet on the direction of crude prices. The Samsung ETF and the $3.5 billion U.S. Oil Fund, which trades in New York, are among those that have upended their strategies to reduce the risk of getting wiped out by another plunge below zero.While the moves may help protect existing investors, they’ve introduced new layers of complexity and may cause the funds to diverge from their original goal of simply tracking front-month oil futures.The Samsung ETF’s announcement will likely be closely watched by oil traders given its moves can impact prices. The fund contributed to a sell-off in June WTI futures last month after dumping its entire holdings to buy September contracts.WTI June futures fell 6% in early trading on Monday, while September contracts dropped 3%.In its filing on Sunday, Samsung Asset said the latest changes are “in good faith and in the best interests of the unit holders” but have made it “impracticable” to meet the fund’s original investment objective. It repeated a warning that in a “worst case scenario,” investors could lose all their money.Here are some further details from the filing:The fund will start adjusting its futures positions after the market close in Hong Kong on May 4 and the process will take “at most” five trading days, subject to market conditions.On May 1, the fund purchased 6,750 put options on September WTI futures. Samsung Asset said failure to do so would have potentially caused the fund’s broker to liquidate some or all of the fund’s futures positions “without giving the manager sufficient time to make any alternative arrangements.”Investors should “exercise caution” because the fund may trade at a larger premium or discount as a result of the suspension of new issuance.Samsung Asset expects that secondary market trading in the ETF and the redemption of units will continue.(Updates with Monday oil prices in seventh paragraph)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
- Bloomberg
Global Smartphone Market Suffers Worst Contraction in History
(Bloomberg) -- Global shipments of smartphones fell at the fastest rate on record in the first quarter, illustrating the devastating impact of Covid-19 on consumption and production in the critical segment of the technology industry.Shipments totaled about 275 million in the first three months of the year, according to market trackers Strategy Analytics and IDC, which estimate the decline from the same period in 2019 at 17% and 11%, respectively. Their numbers vary slightly because they estimate results from a range of manufacturers. Both firms attribute the shortfall largely to the novel coronavirus outbreak, which hurt the supply chain -- with factories across Asia having to shutter temporarily to constrain the spread -- as well as demand due to widespread lockdowns that included retail stores.“What started as primarily a supply-side problem initially limited to China has grown into a global economic crisis with the demand-side impact starting to show by the end of the quarter,” said Nabila Popal, research director at IDC.Read more: Key Smartphone Supplier Forecasts 10% Drop in DemandBellwether supplier Murata Manufacturing Co. had said in mid-April that most of its customers were maintaining order volumes and road maps through the rest of the year, but on Thursday it revised that outlook with a forecast of a 10% slump in demand for the current fiscal year. “The outlook is extremely hard to foresee now,” Chairman Tsuneo Murata said.IDC’s analysis found Apple Inc. iPhones mostly unchanged at close to 37 million shipments, showing greater resilience than top smartphone vendor Samsung Electronics Co., whose output fell from just under 72 million to about 58 million shipments in the quarter. Huawei Technologies Co., with the added pressure of U.S. sanctions and scrutiny, dropped by roughly 10 million units in the quarter, landing near 49 million.Xiaomi Corp. achieved a record 10% market share, according to both market research groups, and managed to increase its shipments, by IDC’s estimation. “Xiaomi is dominating the huge India market at the moment and this is giving the company a big boost in smartphone shipments,” said Linda Sui of Strategy Analytics.Looking forward, IDC expects consumer demand to remain suppressed through the rest of the year, with the global economic downturn preventing any year-on-year growth until at least the fourth quarter.(Updates with chart of historic shipments volume)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.
