1. SoftBank Nears Acquisition of Chipmaker Ampere
2. Qualcomm Warns of Weak Smartphone Market
3. Arm’s Disappointing Outlook Triggers Stock Pullback
4. McKinsey Weighs Risks of China Operations
5. Uber Stock Plunges 6.2%
6. Volvo Warns of Challenging Auto Market in 2024
7. Temu Sellers Face 30% Tariffs
1. SoftBank Nears Acquisition of Chipmaker Ampere
Sources revealed that SoftBank Group is in late-stage talks to acquire Ampere Computing, a chipmaker backed by Oracle, with an enterprise value of approximately $6.5 billion.
Last month, Bloomberg reported that both SoftBank and Arm were interested in acquiring Ampere. Although negotiations have advanced, the deal could still fall through.
Ampere specializes in processors used in data center equipment. In 2021, the company was valued at $8 billion. However, with increasing competition in the semiconductor industry, many tech firms are now working on developing chips similar to Ampere’s.
On Wednesday, Arm issued a more cautious revenue forecast and revealed that investments in AI computing are slowing down.
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2. Qualcomm Warns of Weak Smartphone Market
Qualcomm, the world’s largest smartphone chipmaker, issued a statement on Wednesday projecting revenue between $10.3 billion and $11.2 billion for the quarter ending in March.
CFO Akash Palkhiwala warned that revenue growth in 2025 may remain flat or only slightly increase, causing concerns among market analysts.
Market research firms predict that global smartphone revenue growth will remain sluggish in 2025 and beyond.
Following the announcement, Qualcomm’s stock declined by 4% in after-hours trading, though it remains up 14% year-to-date.
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3. Arm’s Disappointing Outlook Triggers Stock Pullback
Chipmaker Arm Holdings announced on Wednesday that its fiscal fourth-quarter revenue (ending in March) is expected to reach between $1.18 billion and $1.28 billion. While this exceeds previous forecasts, some analysts had anticipated an even higher estimate of $1.33 billion.
This week, AMD and other chip firms have also issued cautious outlooks, raising investor concerns that the AI-driven semiconductor boom may be slowing.
The emergence of China’s DeepSeek AI has further fueled worries about potential profit margin compression for chipmakers.
Following the news, Arm’s stock declined 5% in after-hours trading, though it remains up 40% year-to-date.
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4. McKinsey Weighs Risks of China Operations
Sources revealed that several senior partners at consulting giant McKinsey have begun questioning the risk-reward ratio of their China business, citing increasing geopolitical uncertainty between the U.S. and China.
Concerns intensified after Trump’s re-election in late 2023, with some partners fearing further deterioration in U.S.-China relations. However, others believe McKinsey’s high profit margins in the U.S. are sufficient to offset potential losses in China.
McKinsey currently operates in 10 cities across 65 countries worldwide.
Source: Bloomberg – McKinsey Partners Debate China Presence as US Tensions Rise
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5. Uber Stock Plunges 6.2%
Ride-hailing giant Uber announced that its gross bookings for Q1—including ridesharing, food delivery, and merchant services (excluding tips)—are expected to reach $42 billion to $43.5 billion, falling short of analyst expectations.
Uber also cited foreign exchange fluctuations and extreme winter weather as factors that could impact its ride-hailing and delivery business in Q1.
In Q4 2023, Uber’s total gross bookings rose 18% to $44.2 billion. However, signs of weakening ride-hailing demand in the U.S. have emerged since late last year.
Bloomberg analysts pointed to slowing monthly active user growth and high delivery and ride-hailing costs as key reasons for declining revenue growth rates.
In Q4, Uber set aside $462 million for legal and tax provisions.
Source: Bloomberg – Uber Shares Fall on Weak First-Quarter Gross Bookings Guidance
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6. Volvo Warns of Challenging Auto Market in 2024
Volvo Cars announced today that it does not expect revenue or profit growth this year, citing weak car demand and ongoing trade tensions.
Following the announcement, Volvo’s stock plunged 7.2%, bringing its total decline over the past year to more than 25%.
Volvo and other European automakers face intense competition from Chinese car brands, while the electric vehicle (EV) boom appears to be slowing down.
CEO Jim Rowan predicted that automakers may resort to increased promotional activities outside China this year.
Volvo plans to enhance operational efficiency and focus on maintaining cash flow and operating income.
Source: Bloomberg – Volvo Car Warns of Tough Year After Profit Drop
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7. Temu Sellers Face 30% Tariffs
The Trump administration has begun imposing tariffs on parcels shipped from China and Hong Kong. Sellers on Shein and Temu have received notifications from logistics providers about a 30% tariff on their shipments.
Documents reviewed by Bloomberg indicate that logistics companies will collect a 30% prepayment based on the retail price of goods, with adjustments made according to final U.S. Customs duties.
Temu sellers fear that the new tariffs will significantly extend delivery times.
In 2023, Shein and Temu collectively shipped $46 billion worth of goods priced under $800 to the U.S., accounting for 11% of China’s total exports to the U.S.
Nomura Securities estimates that the new tariffs could reduce China’s GDP growth by 0.2%.
Source: Bloomberg – Shein, Temu Retailers Slapped With 30% Levy on US-Bound Goods
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This report is based on financial news from Financial Times, Bloomberg, he Real Deal, and other media outlets.