EU regulators circle on Apple Pay

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Apple supplier Foxconn’s Q3 profit up 23%, beats forecast

TAIPEI: Taiwan’s Foxconn posted a 23% rise in quarterly profit on Wednesday, as its biggest customer Apple Inc reported better-than-expected earnings thanks to solid sales of mobile devices such as wearables.

Foxconn, the world’s largest contract electronics manufacturer, reported a net profit of T$30.7 billion ($1.0 billion) for the July-September quarter, versus an average forecast of T$27.75 billion by 12 analysts compiled by Refinitiv.

The company did not elaborate on the profit rise from T$24.88 billion a year earlier.

The outlook for Foxconn has improved after Apple gave a positive forecast last month for the year-end holiday shopping quarter.

But the Taipei-based company also faces uncertainty as the protracted Sino-U.S. trade war could raise tariffs on iPhones sold in the U.S. market. Foxconn manufactures the bulk of Apple’s iPhones in China, and analysts estimate nearly half of its revenue comes from the U.S. firm.

More U.S. tariffs against China are set to take effect on Dec. 15, although officials from both sides said they have agreed to roll back tariffs on each others’ goods if a “phase one” trade deal can be negotiated.

Chairman Liu Young-way told an investor conference he sees slight yearly growth in 2020 in Foxconn’s consumer electronics and smart devices business, which includes smartphones and TVs, thanks to “a stabilizing global economic situation.” He did not elaborate.

Prior to the earnings announcement, shares in Foxconn, formally known as Hon Hai Precision Industry Co, closed down 1.4% on Wednesday, lagging the broader market.

Despite trade war concerns and generally sluggish global demand for electronics, the stock has gained nearly 27% so far this year. – Reuters

Huawei to give staff $286 million bonus for helping it ride out U.S. curbs

SHENZHEN: Chinese telecoms giant Huawei Technologies said on Tuesday it will hand out 2 billion yuan ($286 million) in cash rewards to staff working to help it weather a U.S. trade blacklisting.

The world’s largest telecoms equipment provider has said it has been trying to find alternatives to U.S. hardware after the United States all but banned it in May from doing business with American firms, disrupting its ability to source key parts.

The cash is a mark of recognition for work in the face of U.S. pressure, Huawei’s human resources department said in a notice to staff seen by Reuters. It will also double pay this month for almost all its 190,000 workers, a company spokesman said.

The cash rewards will likely go to research and development teams and those working to shift the company’s supply chains away from the United States, the spokesman said.

Details of Huawei’s plan were first reported by the South China Morning Post on Tuesday.

Many in the U.S. government believe that Huawei’s equipment, particularly its 5G networks, pose a security risk, because of the company’s allegedly close ties to the Chinese government. Huawei has denied the Chinese government plays any role in its operations.

Although granted reprieves from much of the U.S. exclusion, Huawei had been working to find alternatives after it witnessed the crippling effect of U.S. sanctions on its smaller Chinese rival ZTE Corp in early 2017.

The company is also the world’s second largest maker of smartphones and a surge in shipments of devices helped it to report a 27% rise in third-quarter revenue last month. -Reuters

Huawei to give staff US$286m bonus for helping it ride out US curbs

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Sony sees first-half net profit drop but lifts full-year forecast

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Google parent Alphabet quarterly profit misses mark

SAN FRANCISCO: Google parent Alphabet on Monday reported a sharp drop in profit over the past quarter as it ramped up spending for a wide array of new gadgets and services.

Profit dipped 23 percent from a year ago to $7.1 billion as revenue grew 20 percent to $40.5 billion for the California tech giant and internet search leader.

Shares in Alphabet fell 1.1 percent in after-hours trade on the weaker-than-expected profits.

Digital advertising on Google continued to be the primary money-maker for Alphabet — accounting for some $34 billion in revenue.

Industry tracker eMarketer forecast that Google will generate $105.33 billion in net digital ad revenue this year, taking a 32 percent share of the worldwide digital ad market.

“Alphabet continues to show strong growth in ad revenues, even as CPCs (costs per click) were down again year-over-year, showing strong continued growth in impressions and paid clicks,“ said eMarketer principal analyst Nicole Perrin.

The analyst added that the cost of acquiring internet traffic appeared by be stabilizing, which is a good sign for Alphabet profitability.

Meanwhile, the earnings report showed that revenue from other sources including cloud computing climbed more than 40 percent to $6.4 billion.

Alphabet has been pumping money into research and development for artificial intelligence, cloud infrastructure, and launching new Pixels smartphones and other hardware.

“We continue to invest thoughtfully in talent and infrastructure to support our growth, particularly in newer areas like Cloud and machine learning,“ said Alphabet chief financial officer Ruth Porat.

Phones and cars

The company, which faces antitrust reviews over its dominance of internet search on both sides of the Atlantic, has been seeking to diversify its business with more hardware and new services.

Losses on “other bets” such as self-driving cars and delivering internet services from high-altitude balloons swelled to $941 million in the quarter, compared to a $727 million loss in the same period a year earlier.

Google chief Sundar Pichai said in a statement: “I am extremely pleased with the progress we made across the board in the third quarter, from our recent advancements in search and quantum computing to our strong revenue growth driven by mobile search, YouTube and Cloud.”

The results were impacted by a one-time charge of $549 million linked to a tax settlement with French authorities, according to Porat.

Alphabet said it set aside nearly $1.6 billion as a provision for income taxes, up from $891 million last year, and that its effective tax rate would be 18 percent, double that from a year earlier.

Capital expenditures included a billion dollars spent to buy buildings in the Silicon Valley city of Sunnyvale and a pair of buildings in Amazon’s home city of Seattle, according to Porat.

Major areas of expense in the quarter were associated with datacenters to support the heavy demand for cloud computing power and costs of content for YouTube subscription streaming services.

Alphabet also spent money to bolster its line-up of Pixel smartphones, which showcase the capabilities of its Android mobile operating system and keep its services in tune with lifestyles increasingly tapping into the internet on the go.

A jump in the number of employees to 114,096 from 94,372 at the end of the same quarter a year earlier drove up expenses, with hiring focused on adding engineering talent for product innovation, according to Alphabet.

The internet titan ended the quarter with $121 billion in cash on hand as rumors arose that it is considering buying San Francisco-based activity-tracking wristband maker FitBit due to its strengths in “wearable computing.” – AFP