—— U.S. Business Activity Slows; iPhone Sales Plunge in China; Nvidia Acquires Run:ai for $700M; Mortgage Rates Hit 5-Month High; Tesla Accelerates Affordable EV Plans; Lamborghini Launches Hybrid SUV; Microsoft and Coca-Cola Form $1.1B AI Partnership
1. U.S. Business Activity Slows
In April, the S&P U.S. Composite PMI fell 1.2 points to 50.9, the lowest since August. The decline was mainly due to softer demand and slower employment growth. However, a reading above 50 still indicates expansion.
S&P Global chief business economist Chris Williamson noted that U.S. economic momentum weakened at the start of Q2, with April seeing the first increase in business closures in six months.
S&P’s employment sub-index dropped 3.2 points to 49, with services employment shrinking and manufacturing hiring slowing.
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2. iPhone Sales Plunge in China
According to Counterpoint Research, Apple’s iPhone sales in China fell 19% year-over-year in Q1—its worst quarter since 2020.
Apple dropped to third place in a highly competitive market. Overall market size grew 1.5%, driven by Honor and Xiaomi.
Typically, Q1 sees strong spending in China due to the Lunar New Year. In contrast, Huawei’s sales surged 70%.
Apple launched rare promotions in January to boost sales, as Chinese government bans on iPhones for state employees pushed more consumers toward domestic brands.
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3. Nvidia Acquires Run:ai for $700M
Nvidia announced it will acquire Israeli AI computing startup Run:ai. The two companies have closely collaborated since 2020. While the deal’s terms were not disclosed, Israeli media report the purchase price at approximately $700 million.
Nvidia employs 20,000 globally, with 3,200 in Israel—its second-largest market.
Nvidia previously acquired Mellanox Technologies in 2020 for $7 billion.
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4. 30-Year Mortgage Rate Hits 5-Month High
According to the Mortgage Bankers Association, the average 30-year fixed mortgage rate rose by 11 basis points to 7.24% in the week ending April 19—the highest since November.
Mortgage applications fell 1% last week. Purchase and refinance applications dropped 2.7% and 5.6%, respectively, with the latter marking the steepest decline since February.
High rates have deterred buyers and sellers, keeping existing-home inventory low, though homebuilders are offering incentives to attract new buyers.
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5. Tesla Accelerates Affordable EV Launch
On Tuesday, Tesla reported Q1 earnings and revealed plans to speed up development of its next-generation vehicle.
CEO Elon Musk said the new model will share production lines with existing vehicles, allowing for launch as early as early 2025.
Q1 revenue and profit missed expectations, and the company burned over $2.5 billion in cash.
Despite weak results, Tesla shares soared over 10% on optimism around its upcoming affordable EV model.
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6. Lamborghini Launches Hybrid SUV
Lamborghini unveiled a hybrid version of its Urus SUV, the 2025 Urus SE.
It features a twin-turbo V8 and electric motor with a combined 789 horsepower. It starts at $258,000—8% more than the Urus S.
Deliveries are expected to begin in early 2025. Key competitors include Porsche’s Cayenne Turbo E-Hybrid and Bentley’s Bentayga Hybrid.
The hybrid Urus cuts carbon emissions by 80% compared to its predecessor and features improved aerodynamics.
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7. Microsoft and Coca-Cola Announce $1.1B AI Partnership
On Tuesday, Microsoft and Coca-Cola unveiled a five-year strategic partnership. Coca-Cola will invest $1.1 billion in Microsoft to advance cloud and generative AI technologies. Microsoft will integrate AI across Coca-Cola’s global operations.
Chief Commercial Officer Judson Althoff said the partnership will drive company-wide innovation through Azure and Copilot.
Coca-Cola initially invested $250 million with Microsoft in 2020 and has now increased that investment more than fourfold.
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This content is sourced from Financial Times, Bloomberg, and The Real Deal, among other financial news outlets.