Alibaba Advances in AI Race
Alibaba Group Holding Ltd. has introduced a cutting-edge artificial intelligence model, aiming to secure a leading position in the competitive AI market. The model, developed by Alibaba’s Tongyi Lab, is designed to interpret human emotions through video analysis, while also providing insights into clothing and surroundings. This innovation represents an enhanced version of the lab’s earlier HumanOmni model. In addition to offering this model as an open-source tool via Hugging Face, Alibaba has benchmarked its capabilities against competitors, including DeepSeek’s recent advancements. The Hangzhou-based e-commerce giant has also entered a strategic partnership with Apple Inc., integrating AI technologies into iPhones. Amid a surge in AI investments, Chief Executive Officer Eddie Wu emphasized the company’s focus on artificial general intelligence as its primary goal. Alibaba’s developments come as global tech leaders, including OpenAI with its GPT-4.5 model, compete for dominance in the rapidly evolving AI sector.
EU Nations Unite to Strengthen European Semiconductor Industry
The Netherlands, alongside eight other European Union countries, has initiated a collaboration to bolster the continent’s semiconductor industry. The coalition, termed the “Semicon Coalition,” includes Belgium, Germany, Finland, France, Italy, Austria, Poland, and Spain. This announcement was made during a meeting in Brussels, marking a significant step toward enhancing Europe’s role in chip production. Semiconductors, commonly known as chips, are increasingly indispensable in modern technology, powering devices ranging from household appliances and computers to drones and advanced military equipment. The coalition aims to boost production capabilities, secure greater funding through both EU channels and private investments, and invest in workforce training tailored to the chip sector. Dutch technology leader ASML plays a pivotal role in this initiative, having experienced record-breaking revenues and a surge in orders. However, export restrictions on specific ASML chip-making machines to China have been implemented to safeguard Europe’s competitive edge in chip technology. This collective effort aligns with broader European ambitions to reduce reliance on external markets, especially amid strained relations with the United States and China. By prioritizing semiconductor innovation and production, Europe seeks to fortify its technological independence and address growing demands, particularly in the defense sector.
Oracle Faces Cloud Business Growth
Oracle Corporation recently announced its fiscal third-quarter financial results, revealing a mixed performance for the period. The company reported a 6% increase in sales, reaching $14.1 billion, though this fell short of analysts’ expectations of $14.4 billion. Additionally, revenue from Oracle’s cloud infrastructure also missed projections. Following the announcement, Oracle’s stock experienced a decline, dropping as much as 7.5% after the markets opened. This marked its lowest level since August 2024. Despite this setback, Oracle highlighted a significant increase in bookings, with remaining performance obligations rising to $130 billion, compared to $97.3 billion in the prior quarter. Looking ahead, Oracle forecasts strong growth for its cloud infrastructure business, predicting a 15% sales increase in fiscal 2026 and a 20% rise in fiscal 2027. The company attributes this anticipated growth to the rising demand for computing power to support artificial intelligence workloads. Oracle has secured cloud agreements with major players, including OpenAI, Meta, Nvidia, and AMD, solidifying its position in the AI-driven cloud market. A notable development is Oracle’s ongoing $100 billion data center project in Texas, part of a joint venture with OpenAI and SoftBank. This initiative, dubbed “Stargate,” is expected to further enhance Oracle’s data center capacity, which is projected to double by the end of the calendar year. However, some uncertainties loom, including the potential impact of a U.S. government ban on TikTok, one of Oracle’s significant cloud customers. TikTok’s future in the U.S. remains uncertain as negotiations for its acquisition by American buyers continue. Oracle’s capital expenditures for data center expansion reached $5.9 billion in the quarter, significantly higher than analysts’ estimates of $3.8 billion. Despite concerns about overinvestment in data centers and competition from lower-cost AI models, Oracle remains optimistic about its long-term growth potential in the cloud computing sector.
Meta’s AI Chip Ambitions
Meta Platforms Inc., known for its ownership of Facebook, Instagram, and WhatsApp, is heavily investing in artificial intelligence (AI) infrastructure. The company has projected its 2025 expenses to fall between $114 billion and $119 billion, allocating up to $65 billion for AI-related developments, including custom chip production. As part of its Meta Training and Inference Accelerator (MTIA) series, Meta has developed a new AI training chip in collaboration with Taiwan Semiconductor Manufacturing Company (TSMC). Designed specifically for AI tasks, the chip is expected to be more efficient than the GPUs traditionally used for AI workloads. Recent progress includes the completion of the chip’s “tape-out” phase—a critical step in silicon manufacturing—and the launch of test deployments. Meta’s AI chip initiative has faced challenges, including the cancellation of earlier designs. However, the company successfully introduced its first MTIA inference chip last year, which powers recommendation systems for platforms like Facebook and Instagram. Meta aims to expand its custom chip usage for training AI systems by 2026, with plans to support generative AI technologies such as chatbots. Despite these efforts, Meta remains one of Nvidia’s largest customers, using GPUs extensively for tasks like AI training and inference across its platforms. However, questions have arisen about the scalability of large language models, with researchers exploring alternative approaches to improve computational efficiency.
Apple Faces Setbacks in AI Division
Apple Inc. is encountering significant challenges within its AI division, leading to delays in updating the Siri digital assistant. Originally planned for the iOS 18.4 update in April, the new features that where introduced last June, which include Siri’s ability to use personal information for queries and enhanced app control—are now expected to be released “sometime in the coming year.” Apple has been struggling to develop these features, pushing their release date back to at least next year. Concerns were raised internally by software chief Craig Federighi and other executives about the features not working as intended. Some within Apple’s AI division believe that the features may need to be rebuilt from scratch, delaying their rollout until the next-generation Siri, anticipated in 2026. These delays are particularly embarrassing for Apple, as the company has been promoting these features in TV commercials for nearly six months. The iPhone 16, introduced last fall, highlighted the integration of the Apple Intelligence AI platform. However, the core features may not be available until months after the iPhone 17 is launched. Apple’s plans to make Siri more conversational and similar to ChatGPT have been significantly delayed. The foundational upgrades are expected to be ready by 2026, with the full user interface likely arriving in iOS 20 in 2027. This has led to internal discussions about potential changes in leadership within the AI group. To address customer frustration, AppleCare support representatives have been instructed to reiterate that the new Siri features are anticipated to roll out next year. Additionally, there are concerns that more powerful AI models required for Siri could strain current hardware, necessitating future product upgrades.
HP Faces Profit Challenges
Hewlett Packard Enterprise (HPE) saw its shares plummet by 20% in premarket trading on Friday after the company revealed that its annual profit outlook would be impacted by recently imposed U.S. tariffs. This setback comes as the AI-server manufacturer navigates an intensely competitive market. New tariff measures introduced by the U.S. government have complicated supply chains. A 25% duty now applies to aluminium and steel imports from Canada and Mexico, with exemptions on certain goods expiring on April 2. Additionally, a cumulative 20% tariff on Chinese imports, enforced incrementally since February, is adding to the challenges faced by corporations. CFO Marie Myers acknowledged the tariff-related uncertainties and their impact during a post-earnings discussion. “Recent tariff announcements have created uncertainty for our industry, primarily affecting our server business,” Myers stated. In response, the company plans to implement supply chain adjustments and pricing measures to mitigate these effects. In a bid to control costs amid growing competition from industry rivals such as Dell and Super Micro Computer, HPE also announced workforce reductions. The AI-server market is currently grappling with costly transitions, particularly as companies adopt advanced GPUs to meet rising demand. Despite these challenges, HPE remains relatively competitively priced compared to its peers, trading at 8.19 times its projected earnings for the next 12 months. This compares with 9.74 times for Dell and 10.71 times for Super Micro Computer. However, if premarket losses persist, HPE stands to lose over $4 billion in market value.
Samsung and AWS Collaborate to Advance AI
Samsung Electronics has partnered with Amazon Web Services (AWS) to showcase the application of AI in radio access networks (RAN) at the Mobile World Congress (MWC) in Barcelona, Spain. This collaboration features the Samsung CognitiV Network Operations Suite (NOS) Copilot, an advanced AI assistant integrated within Samsung’s automation platform. Utilizing Amazon Bedrock, a managed service for building and scaling generative AI applications, the Samsung CognitiV NOS Copilot streamlines the management of large-scale RAN. Deokwoo Jung, vice-president and head of Samsung Electronics Networks Business Network AI, emphasized the transformative potential of AI, stating, “AI is more than a buzzword these days and it’s an applicable technology that we are seeing change every industry.” The suite includes AI-powered network automation applications for comprehensive lifecycle management, from planning to optimization. By presenting data clearly and translating raw data into actionable insights, the AI assistant simplifies operators’ tasks. Seamlessly integrated into existing RAN systems, Samsung CognitiV NOS Copilot communicates in natural language, reducing network management complexities. It also offers deployment options across various platforms, including Amazon Bedrock, and enhances network analysis and troubleshooting. This tool has the potential to provide operators with actionable explanations and technical summaries for improved network management. Samsung is also exploring the use of AI and machine learning in radio intelligent controller applications, aiming to deliver a comprehensive suite of capabilities. AWS Korea managing director Kee Ho Ham expressed excitement about the collaboration, stating, “By leveraging Amazon Bedrock, operators can harness the power of AI to build smarter, more efficient networks while reducing complexity and operational costs.”
TSMC to Invest $100 Billion in U.S. Semiconductor Manufacturing
Taiwan Semiconductor Manufacturing Company (TSMC) has unveiled plans to invest $100 billion in the United States over the coming years to expand its semiconductor manufacturing capabilities. The investment will fund the construction of five new facilities, including three chip fabrication plants, two advanced packaging facilities, and a large research and development center. This announcement was made by TSMC CEO C.C. Wei alongside former U.S. President Donald Trump. TSMC, which is a key client of Dutch chip equipment maker ASML, aims to strengthen its presence in the U.S. semiconductor market. Trump emphasized the importance of producing chips domestically, calling it “a matter of national security.” This latest commitment adds to an investment announced in April of the previous year, where TSMC confirmed plans to open a third factory in Arizona by 2030. While TSMC had already been considering further investments in the U.S., import tariffs played a significant role in accelerating the decision. Exporting chips to the U.S. has become more expensive, making domestic production increasingly attractive. Although TSMC has not provided an exact timeline for the construction of the new facilities, the company has stated that the project is expected to create approximately 40,000 construction jobs over the next four years. The initiative highlights the company’s commitment to meeting the growing demand for semiconductors while aligning with U.S. efforts to bolster domestic production and reduce reliance on foreign supply chains.
Broadcom Thrives with AI Growth
Broadcom is currently experiencing a significant surge following the recent announcement of a 28% increase in fiscal Q4 profit. The company’s revenue growth has been accelerating for four consecutive quarters, with a 51% rise to $14 billion. A key driver of this impressive growth is the company’s AI revenue, which has more than tripled from fiscal 2023, reaching $12.2 billion. CEO Hock Tan is highlighting that Broadcom is developing AI chips in collaboration with three major cloud customers. He estimates that the total addressable market for AI chips and AI networking equipment could be between $60 billion and $90 billion by 2027. This optimism underscores the company’s strategic focus on the burgeoning AI sector. For the fiscal first quarter ending in January, analysts are expecting Broadcom to report a profit of $1.51 per share, a 37% year-over-year increase, with revenue projected to rise by 22% to $14.6 billion. These results are due to be released after the market close on Thursday. Broadcom’s success is particularly notable amid the broader tech sell-off, demonstrating the company’s resilience and ability to capitalize on the growing demand for AI technology. As Broadcom continues to innovate and expand its AI capabilities, it remains well-positioned for future growth in this rapidly evolving market.
Adidas Eyes U.S. Market Gains
Adidas is placing increased focus on the U.S. market as it seeks to strengthen its position against its key competitor, Nike. With growing uncertainty around consumer demand in China, many global brands are turning their attention to American shoppers for growth opportunities in 2025. Under the leadership of CEO Bjorn Gulden, has made significant strides since severing ties with rapper Ye and discontinuing the Yeezy sneaker line in 2022. The company has experienced a remarkable 160% rise in stock value since Gulden’s appointment was announced. As Adidas prepares to release its full-year financial results in early March, investors are eager to learn more about its strategies to capture U.S. market share and compete against emerging sportswear brands like On Running and Hoka. Recent data indicates that while Nike’s global sportswear market share fell to 14.1% last year from 15.2% in 2023, Adidas expanded its share from 8.2% to 8.9%. Other brands, including New Balance and Hoka, also saw gains. Despite this growth, Adidas faces challenges in North America, where its sales declined by 7% in the third quarter due to the loss of its Yeezy line. However, with overall sales increasing by 19% in the final quarter and 12% throughout 2024, Adidas appears poised for continued momentum. To solidify its presence in the U.S., Adidas has launched initiatives targeting American consumers, including collaborations with Los Angeles-based label Sporty & Rich and musician Pharrell Williams. The brand has also bolstered its roster of athlete endorsements, such as WNBA player Satou Sabally and college football star Travis Hunter, while promoting its Terrace franchise of sneakers, including the Samba and Gazelle, which have shown strong sales during the holiday season. North America remains a critical growth area for Adidas. By capitalizing on Nike’s current challenges and leveraging its recent successes in the U.S. direct-to-consumer market, Adidas could secure long-term growth and strengthen its position in the competitive global sportswear industry.!