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Extreme Networks Snags an Upgrade on Inventory Normalization 2024-04-23 13:02:00+00:00 - Key Points Extreme Networks provides networking solutions offering hardware and software to data centers, government agencies and schools. Extreme Networks shares were upgraded to a Buy from Hold at B. Riley Securities. Riley Analyst Dan King believes the post-COVID inventory normalization is over, and demand is improving. 5 stocks we like better than Extreme Networks Extreme Networks Inc. NASDAQ: EXTR is a cloud-driven networking solutions provider that serves three seemingly “recession-proof” industries: government, education and healthcare. With nearly 40% of their revenues coming from government and education, this computer and technology sector company should fare relatively well even in uncertain macroeconomic conditions. However, shares are down nearly 38% for the year. This can be attributed to inventory glut, which has been a common theme among peers like networker Ciena Co. NYSE: CIEN, technology companies like Mobileye Global Inc. NASDAQ: MBLY and retailers like Under Armour Inc. NYSE: UA. Get Extreme Networks alerts: Sign Up What Does Extreme Networks Do? Extreme Networks Today EXTR Extreme Networks $11.09 +0.36 (+3.36%) 52-Week Range $10.57 ▼ $32.73 P/E Ratio 18.48 Price Target $22.36 Add to Watchlist Extreme Networks is a networking company that offers hardware and software-as-a-service (SaaS) solutions to enterprises, data centers and organizations. It sells the hardware and then uses a SaaS model to sell maintenance, services and software. It has integrated artificial intelligence (AI), security and analytics onto a single platform. This is what separates Extreme from competitors, helping drive 37% subscription ARR growth in its fiscal Q2 2024. Inventory and Demand Improvement B. Riley Securities upgraded Extreme Networks shares to a buy rating from hold. Analyst David King feels channel inventory and demand have been improving, notably with the normalization of channel inventory. King cites the upbeat comments from one of Extreme Network’s largest customers IT solutions provider TD SYNNEX Co. NYSE: SNX, which Extreme derives nearly 18% of its revenues from. TD SENNEX noted that the demand environment has stabilized, and the company expects further improvement in the second half of 2024. King also feels Extreme may have lowballed its estimates, leaving more runway for the upside. His price target is $14. Broker Downgrades Following its fiscal Q2 2024 earnings report, Rosenblatt and UBS downgraded Extreme Networks' shares to Neutral on Feb. 1, 2024. Rosenblatt cut its price target from $19 to $15, while UBS cut its target from $22 to $14. Daily Descending Triangle Pattern The daily candlestick chart on EXTR illustrates a descending triangle pattern. The descending trendline formed at $12.95 on Feb. 28, 2024, falling to the flat-bottom lower trendline at $10.85. The daily relative strength index (RSI) has gone flat around the 40-band. EXTR is setting up for a breakdown through the lower flat-bottom trendline or a breakout through the upper descending trendline. Pullback support levels are at $10.58, $10.00, $9.51 and $8.49. Missed the Runway On Jan. 31, 2024, Extreme Networks reported EPS of 24 cents, beating consensus analyst estimates by a penny. Revenues fell 6.9% YoY to $296.4 million missing $303.2 million consensus estimates. The company noted that the product backlog has been normalized. Double-digit YoY bookings growth was prevalent in the EMEA and APAC regions. Cloud SaaS deferred subscription revenues rose 32% YoY to $246 million. ARR rose 37% YoY to $158 million. Non-GAAP gross margins rose 400 bps YoY to 62.5%. Metrics to Watch Extreme says 17% of its total product bookings came from new logos in the quarter. Logos refers to customers and refers to the company logos. The company acquired new customers that comprise 17% of the total quarterly bookings. The company grew its $1 million plus customers to 44. Did Extreme Lowball Weaker Fiscal Q3 2024 Guidance? Extreme provided soft guidance for fiscal Q3 2024 with EPS loss of 22 cents to 17 cents versus consensus analyst estimates for a profit of 28 cents. Revenue expectations were cut to $200 million to $210 million versus $321.36 million consensus estimates. Fiscal Q4 2024 revenues are expected to be between $265 million to $275 million versus $355.27 million. CEO Insights Extreme Networks CEO Ed Meyercord made upbeat remarks addressing the final stage of COVID-era supply chain constraints. Meyercord commented, "The networking industry, like much of IT, is exiting the final stage of the COVID-induced era of supply chain constraints, which is still impacting our business. As a result, our distributors and partners have lowered inventory purchases, which we expect to accelerate in the third quarter. We expect to emerge in the fourth quarter at a more normalized level of revenue and earnings. Our booking trends and funnel of new opportunities are a better reflection of customer demand. We're seeing stabilization across EMEA and growth in APAC.” Extreme Networks analyst ratings and price targets are at MarketBeat. Before you consider Extreme Networks, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Extreme Networks wasn't on the list. While Extreme Networks currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys. 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Put Some PEP in Your Income Portfolio With PepsiCo Stock 2024-04-23 12:55:00+00:00 - Key Points PepsiCo had a solid Q1 despite headwinds and reaffirmed its guidance for 2024. Cash flow, balance sheet, and capital returns are healthy and forecasted to improve this year. Analysts have lifted sentiment to Moderate Buy and see the stock moving higher with a chance of setting a new high. 5 stocks we like better than PepsiCo Consumer staples and Dividend Kings like PepsiCo NASDAQ: PEP are not often stocks that provide a lot of PEP for a portfolio. However, they can deliver substantial, market-beating returns when the stars align. Regarding PepsiCo, this blue-chip, industry-leading, undervalued, high-yielding consumer-focused company is amid a leveraged rebound, which is shown in the charts. The charts show a solid trend-following signal that could soon take the market to a new all-time high. That outlook is affirmed by the analysts who’ve revised their ratings enough in the last six months to lift the stock’s consensus rating from Hold to Buy and keep the price target steady. The two freshest revisions, issued only weeks before the Q1 earnings release, include two upward price target revisions and the new high target among analysts. That is $209, a new all-time high when reached. Get PepsiCo alerts: Sign Up PepsiCo had a Strong Quarter Despite Headwinds PepsiCo Today PEP PepsiCo $171.22 -5.24 (-2.97%) 52-Week Range $155.83 ▼ $196.88 Dividend Yield 2.96% P/E Ratio 26.06 Price Target $186.92 Add to Watchlist PepsiCo’s Q1 was solid, given the tough comps to last year, inflationary and consumer headwinds, and a recall of Quaker products that included cereals, bars, and snacks. The impact of the recall is reported at nearly 100 basis points of reported revenue, enough to double the reported outperformance relative to analysts' consensus estimates. PepsiCo reported $18.25 billion in net revenue for a gain of 2.3%, which outpaced consensus by 80 bps. Volume fell by 0.5% but is offset by price and mix. Quaker is the sole weak spot segmentally, down -24% compared to last year, but tough comps are also in play. Latin America is the strongest segment, with 16% GAAP and 8% organic growth, excluding the impact of FX conversion. Latin America is now the 3rd largest segment by sales. APAC grew 11%, Europe 10%, and AMESA 7%. Domestic segments PepsiCo NA and Frito Lay NA grew by 1% and 2%, highlighting the effectiveness of PepsiCo’s diversification and international growth strategy. Margin news is another area of strength. The company widened the net income margin by 35 basis points to leverage bottom-line growth. The GAAP EPS of $1.48 grew by 6% to more than double the top-line advance, while adjusted earnings of $1.61 are up 7%. Adjusted earnings outpaced the consensus estimate reported by Marketbeat by $0.09 or 590 bps and led the company to affirm its guidance. PepsiCo reaffirmed the outlook for 4% or better organic growth compared to the 3.5% consensus and for EPS to grow by at least 8%. PepsiCo Capital Returns are Healthy PepsiCo Dividend Payments Dividend Yield 2.94% Annual Dividend $5.06 Dividend Increase Track Record 52 Years Annualized 3-Year Dividend Growth 7.12% Dividend Payout Ratio 77.02% Recent Dividend Payment Apr. 1 See Full Details PepsiCo’s dividend is near the high end of its historic range, with shares down from their highs, but the yield may not last long. The payment is worth nearly 3% at current prices and is healthy, safe, and reliable. Not only is PepsiCo a Dividend King with a track record of increases, but its financial metrics are solid. Q1 operations included a sequential cash draw, but operations over the last year resulted in nearly doubling cash, reduced total liabilities, and a 2.9% increase in shareholder equity. Better results are expected this year. The dividend payment is about 65%, on the high side for safety, but backed up by earnings growth. The projected distribution payment for 2024 is for a 7% increase starting in June, less than the 8% minimum earnings growth, and that does not include the impact of share repurchases. PepsiCo does not repurchase aggressively but enough to offset share-based compensation; the count is down an average of 0.3% YOY at the end of Q1. PepsiCo Steady After Solid Results PepsiCo's price action is steady and edging higher following the Q1 results and guidance update. The move aligns with recent action, suggesting a trend-following signal is in play. The market shows a bottom at $160, which is above the prior low and the long-term up-trend line that has been in play for fifteen years. The MACD and stochastic Indicators confirm the signal, showing solid buy signals of their own, and have ample room to move higher. Assuming the market follows through on this signal, PEP stock should advance over the next few quarters and could retest all-time highs by the end of the year. Before you consider PepsiCo, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and PepsiCo wasn't on the list. While PepsiCo currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
Sherwin-William’s Win Over PPG Stock in The Construction Boom 2024-04-23 11:33:00+00:00 - Key Points Sherwin-Williams stock could be set to rally over the sector on a U.S. construction boom that Buffett predicted. Wall Street analysts are getting ready by boosting the stock's price target, and markets value it over its peers. The stock is earning its place over its biggest competitor, PPG Industries, as its market share shows. 5 stocks we like better than PPG Industries The threat of geopolitical tension is always bad for the stock market; however, certain stocks tend to shrug off international conflicts. Inside the U.S., the real estate sector is looking at a potential new bull run in the coming quarters, and it all has a relatively simple cause. After Warren Buffett started buying into homebuilding stocks, investors got curious. Far from being a discount, Buffett’s position in D.R. Horton Inc. NYSE: DHI is more of a cyclical bet than his typical long-term value investing strategy—or is it? According to the Intercontinental Exchange, most mortgages in the U.S. carry an average interest rate of 3.25% today. Get PPG Industries alerts: Sign Up These rates matter because, as mortgages hover around 7.5% these days, most homeowners are probably not looking to sell their cheap mortgage only to refinance a new home at a much more expensive rate. At the same time, would-be homebuyers aren’t looking to buy at these high rates. To get out of this situation, builders need to step up and inject new inventory. After these homebuilders do their part and Buffett gets paid, stocks like Sherwin-Williams Co. NYSE: SHW will need to come in and furnish newly built homes, as the company is one of the leading chemicals (paint) names in real estate. Markets Are Getting Ready After declining by 12% in the past two weeks, Sherwin-Williams stock fell to 88% of its 52-week high, attracting some attention as a potential buy target. Now, why would analysts at Citigroup Inc. NYSE: C and the UBS Group NYSE: UBS boost the stock’s price target ahead of its coming quarterly earnings announcement? That’s right, price targets advanced to $390 from Citi and $402 from UBS. Respectively, these banks suggest that the stock could rally by 28% and 32% in the coming months. However, investors should take analyst ratings with a grain of salt, so here’s what markets think about Sherwin-Williams. Compared to the construction sector, Sherwin-Williams stock is valued at a 33x P/E multiple, a 98% premium to the sector’s 16.6x average valuation today. There must be a good reason for analysts to expect so much upside in the stock and for markets to be willing to overpay for it as well. It won’t be the stock’s 1% dividend yield; investors could start asking other questions instead, focusing more on the stock’s fundamentals and potential national real estate demand. The Sherwin-Williams Brand: As Good as Ever Sherwin-Williams Today SHW Sherwin-Williams $302.36 -6.90 (-2.23%) 52-Week Range $221.76 ▼ $348.37 Dividend Yield 0.95% P/E Ratio 32.69 Price Target $325.94 Add to Watchlist As of 2019, Sherwin-Williams owned 28.5% of the North American paints and coatings market. In second place, PPG Industries Inc. NYSE: PPG took nearly 21% of the market. While this is a tight competitive positioning, markets still preferred Sherwin-Williams over PPG. Valued at 22.1x, PPG stock trades at a 33% discount to Sherwin-Williams. The saying “It must be cheap for a reason” applies here, as the same Citigroup and UBS analysts that boosted Sherwin-Williams came to downgrade PPG stock. From $156 down to $150, UBS sees a 15% upside in the stock. For Citi, the downgrade took the stock’s previous valuation of $170 down to $161, a 5.3% decline in their perceptions of the stock. Analysts aren’t the only ones carrying this opinion for the two competitors. Institutional investment inflow over the past year was $9.6 billion for Sherwin-Williams, while for PPG, it was only $5 billion. How bears regarded these two stocks over the past month can also give investors another angle for gauging current sentiment. PPG stock’s short interest rose by 5.6% during the period. Remembering that fighting the market – and analysts – could prove futile, bears retreated from Sherwin-Williams stock, as its short interest declined by 9.9% in the past month. As Sherwin-Williams earnings are coming up on April 23rd, analysts looking to boost their reputation gave the stock a higher valuation. At the same time, short sellers wanted to avoid losses and retreated from the stock. PPG Industries Today PPG PPG Industries $130.43 -0.73 (-0.56%) 52-Week Range $120.32 ▼ $152.89 Dividend Yield 1.99% P/E Ratio 22.03 Price Target $155.50 Add to Watchlist The final check may be based on the two stocks' price-to-book (P/B) ratios. Investors are willing to pay 21x for Sherwin-Williams' book, the first financial metric to expand on rising net income. The company's financials show a net income margin of 10.4%, over PPG's 7%. A gap in profitability, combined with Sherwin-Williams’ superior returns on invested capital (ROIC) rates of 14.5%, superior to PPG’s 9.3%, could have driven investors to discount PPG’s book to only 3.8x. Before you consider PPG Industries, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and PPG Industries wasn't on the list. While PPG Industries currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
Zscaler’s Potential Upside Continues to Explode 2024-04-23 11:05:00+00:00 - Key Points Zscaler shares have continued to fall since March’s earnings despite smashing expectations. They’ve also had a run of bullish analyst upgrades and been given lofty price targets. If shares can form a low and consolidate around it, then things could get interesting pretty quickly. 5 stocks we like better than Zscaler For a stock that was just starting to experience what a 200% rally felt like, the past month has sure been a wake-up call for Zscaler Inc NASDAQ: ZS. Having caught the wave of risk-on sentiment that began to sweep equity markets in November, the cyber-security tech stock was unable to maintain the momentum through the end of Q1. This was even as the broader market, and other tech stocks in particular continued to see gains. Sure, the benchmark S&P 500 index is currently experiencing its worst selloff of the year, as inflation threatens to make a comeback, but that only started three weeks ago. Zscaler’s 35% drop since the start of February serves as its own reminder to investors: just as tech stocks can outpace the market in a rally, they can undoubtedly outpace it in a selloff. Get Zscaler alerts: Sign Up However, with Zscaler’s stock’s relative strength index (RSI) in the low 20s, indicating extremely oversold conditions, the question has to be asked: could we be looking at the mother of all entry opportunities? Reasons to be Bullish Zscaler Today ZS Zscaler $176.92 +5.95 (+3.48%) 52-Week Range $84.93 ▼ $259.61 Price Target $230.24 Add to Watchlist Beyond the technical indicators supporting this thesis, there are the fundamentals to consider. Zscaler smashed analyst expectations for their Q2 earnings last month, reporting both a record revenue and earnings per share print. The company also boosted its forward guidance for the entire year, ahead of the consensus; something in and of itself is usually enough to spark a fiery rally. But instead, Zscaler shares have continued to sink and dipped to a new low during Friday’s session. This has not only undone a large portion of the recovery rally that had been underway since May of last year, but it’s also put them back trading at 2020 levels. However, even though the tape might tell its own story, the Wall Street analysts aren’t buying it. Since the start of last month, there’s been a run of bullish analyst upgrades, comments, and price targets on the stock that all point to an upside potential that’s only increasing. Run of Analyst Upgrades Take JMP Securities, for example, who, in the aftermath of Zscaler’s knockout earnings, reiterated their Market Outperform rating and gave the stock a price target of $270. Rosenblatt Securities took a similar stance, only with a price target of $290. As Zscaler shares have continued to trade down in the weeks since, the teams at Robert W. Baird, Truist, Macquarie, and KeyCorp have all joined the bull camp, and all have price targets well up in the $200s. For those of us on the sidelines, this gives some exciting pause for thought. Zscaler shares closed out last week under $170; against Rosenblatt’s price target of $290, that’s pointing to an upside of 70%. Taking even one of the more recently refreshed price targets, like KeyCorp’s $220 last Thursday, investors can be targeting at least 30% of gains in the near term. Getting Involved With both the technical indicators and strong fundamental performance underpinning these lofty price targets, there’s a lot to like about Zscaler right now. There’s no doubt that the stock has gotten caught up in the risk-off sentiment that is shaving month’s worth of gains from equities in just a few weeks, but this is a tech stock that can actually point to some genuinely impressive growth and momentum in all the right spots. If nothing else, consider this: since the first time Zscaler traded at these prices back in 2020, its revenue has more than quadrupled while posting consistent quarter-on-quarter growth. In terms of picking a starting point, those of our readers considering a position should watch for a strong day of gains to initiate a bottom. If Zscaler shares can begin to consolidate above that low, if not altogether start an immediate recovery rally, we could be looking at a reasonably strong entry opportunity to take advantage of. Before you consider Zscaler, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Zscaler wasn't on the list. While Zscaler currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys. View The Five Stocks Here
Stock market today: S&P 500 snaps 6-day losing streak ahead of Big Tech earnings rush 2024-04-23 05:10:00+00:00 - Stocks have recovered from their recent slump on Monday. But bearish strategists on Wall Street still see key concerns that aren't going away anytime soon for stock investors. With Federal Reserve interest rate cut expectations fading, signs of inflation remaining sticky, and stocks still trading at higher-than-average valuations, many believe the market is in a similar position to where it stood entering its three-month downturn in the late summer and fall of 2023. "Price action may depend on earnings and could stabilize near-term," JPMorgan's chief market strategist Marko Kolanovic wrote in a note on Monday. "Beyond this, however, we think the sell-off has further to go. We remain concerned about continued complacency in equity valuations, inflation staying too hot, further Fed repricing, and a profit outlook where the implied acceleration this year might end up too optimistic." "The current market narrative and patterns are increasingly resembling those of last summer, when upside inflation surprises and hawkish Fed revisions drove a correction in risk assets, but investor positioning now appears more elevated." Last summer, markets became increasingly pessimistic about the likelihood of Federal Reserve interest rate cuts coming soon. This contributed to a rapid rise in bond yields that ultimately weighed on equities. Julian Emanuel, who leads Evercore ISI's equity, derivatives, and quantitative strategy, recently told Yahoo Finance things are setting up like last summer too. Emanuel has been closely watching the 2-year Treasury yield, which recently hit 5% for the first time since November 2023. Stocks subsequently sold off in tandem with the move. "The reason it might be more of the concern at this point is because of that implicit promise that markets have traded on of three [Fed rate] cuts dialed back," Emanuel said. "And if you look at it going back to March, I think it's a lot more than a coincidence the market rolled over from the highs literally precisely the moment the market started pricing in fewer than those three promised cuts." Morgan Stanley chief investment officer Mike Wilson wrote in a research note on Sunday that with the 10-year Treasury yield (^TNX) now handily above the critical level of 4.35% to 4.40% he'd been watching, higher yields could weigh on stock valuations moving forward. "If yields stay at current levels over the next 3 months, multiples could face ~5% downside within that period all else equal (which would equate to 4700-4800 on the S&P 500)," Wilson wrote. Wilson notes that with elevated yields, any move higher from here will "largely have to be earned through earnings upside rather than multiple expansion."
Massive News for ASML Stock Investors 2024-04-23 04:40:00+00:00 - Fool.com contributor Parkev Tatevosian evaluates what the news could mean for ASML (NASDAQ: ASML) stock investors. *Stock prices used were the afternoon prices of April 20, 2024. The video was published on April 22, 2024. Should you invest $1,000 in ASML right now? Before you buy stock in ASML, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and ASML wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $466,882!* Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. See the 10 stocks » *Stock Advisor returns as of April 22, 2024 Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends ASML. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool. Massive News for ASML Stock Investors was originally published by The Motley Fool
TSMC Topped Estimates On The Back Of Insatiable AI Demand 2024-04-23 03:31:00+00:00 - TSMC Topped Estimates On The Back Of Insatiable AI Demand Last Thursday, the world’s largest producer of advanced processors issued its first quarter results and they were even better than expected as AI demand continues to go strong. Taiwan Semiconductor Manufacturing Company Limited (NYSE: TSM), whose customers include the AI chip leader, NVIDIA Corporation (NASDAQ: NVDA) as well as the tech titan Apple Inc (NASDAQ: AAPL), expects 2024 to be another year of healthy growth on the back of its technology leadership and broad customer base that also includes Advanced Micro Devices Inc (NASDAQ: AMD) and Qualcomm Incorporated (NASDAQ: QCOM). First Quarter Highlights For the quarter ended on March 31st, TSMC reported net revenue grew 16.5% YoY to NT$592.64 billion. Net income rose 8.9% YoY to NT$225.49 billion. The net profit margin continues to be one of the highest in the company’s history at 40%, while an industry average is about 14%, reflecting TSMC’s competitiveness. Nvidia Set To Become The TSMC Of AI Earlier in March, Nvidia clearly stated its aim to become the TSMC for AI as it continues its expansion beyond hardware, entering into software services. During its annual conference, GTC 2024, Nvidia CEO Jensen Huangunveiled new tools. In terms of AI development, Nvidia aims to do for the world exactly that what TSMC does for the AI chip leader by turning its design and concept into physical chips. Therefore, TSMC builds the chips Nvidia, Apple and others need and Nvidia wants to become the AI maker, turning concepts of its clients into a model they get to bring with them. Second Quarter Guidance For the current quarter, TSMC is supported by strong demand for industry-leading 3-nanometer and 5-nanometer technologies, but this strength is partially offset by a continued smartphone seasonality. TSMC guided for second-quarter revenue in the range between $19.6 billion and $20.4 billion. Due to the recent earthquake in Taiwan along with higher electricity costs, TSMC expects the second quarter gross margin to decline by 1.1 percentage points to 52% at the midpoint. Fortunately, the earthquake that occurred on April 3rd did not cause any power shortages, nor structural damage to the company’s facilities and critical tools such as extreme ultraviolet (EUV) lithography system. One of its closest competitors, Intel Corporation (NASDAQ: INTC), lost the lead because TSMC was the first to adopt EUV lithography systems that are essential for its leadership. Although some wafers were affected and had to be scrapped, most of the lost production should be recovered in current quarter, with minimal impact to revenue. Story continues Outlook With AI demand going strong, TSMC managed to weather the tapering off of pandemic-led electronics demand, fueling its stock to new heights. In 2025, TSMC is planning to begin mass-producing its 2-nanometer chips, which come with more power and efficiency compared to its current 3-nanometer ones. As for the full year, TSMC estimates revenue contribution from server AI processors to more than double. For the full year, TSMC guided for low to mid-20% revenue growth under the assumption that the AI market continues to expand while the PC market stabilizes, and the smartphone market returns to growth amid an improved macroeconomic backdrop. Although TMSC might not keep the pace with Nvidia in terms of near-term gains due to the fact its business goes beyond chips, it certainly won’t be in a recovery mode like its client, Qualcomm, after the 2023 lulled the smartphone market to sleep. Qualcomm is scheduled to report its fiscal second quarter results on May 1st. Best known for making smartphone chips, Qualcomm did surpass estimates with its fiscal first quarter financials and its upcoming report should reflect the business picking up as smartphone sales continue to recover. DISCLAIMER: This content is for informational purposes only. It is not intended as investing advice. This article is from an unpaid external contributor. It does not represent Benzinga's reporting and has not been edited for content or accuracy. "ACTIVE INVESTORS' SECRET WEAPON" Supercharge Your Stock Market Game with the #1 "news & everything else" trading tool: Benzinga Pro - Click here to start Your 14-Day Trial Now! Get the latest stock analysis from Benzinga? This article TSMC Topped Estimates On The Back Of Insatiable AI Demand originally appeared on Benzinga.com © 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
FTC sues to block $8.5 billion merger of Coach and Michael Kors owners 2024-04-22 23:16:00+00:00 - The Federal Trade Commission is suing to block Tapestry's $8.5 billion acquisition of Capri Holdings, saying the deal would harm consumers by reducing competition and raising prices in the affordable luxury sector. Monday's federal court filing by the FTC challenges the proposed deal that would have one company controlling six fashion brands: Tapestry's Coach, Kate Spade and Stuart Weitzman and Capri's Michael Kors, Versace and Jimmy Choo. The acquisition could have a negative impact on the millions of American shoppers who now benefit from the head-to-head rivalry between Tapestry and Capri, as well as on the roughly 33,000 workers employed by both companies worldwide, the FTC stated. "With the goal to become a serial acquirer, Tapestry seeks to acquire Capri to further entrench its stronghold in the fashion industry," Henry Liu, director of the FTC's Bureau of Competition, stated. "This deal threatens to deprive consumers of the competition for affordable handbags, while hourly workers stand to lose the benefits of higher wages and more favorable workplace conditions." Tapestry rejected the FTC's stance, saying the agency understands neither the marketplace nor how people shop. "The bottom line is that Tapestry and Capri face competitive pressures from both lower- and higher-priced products. In bringing this case, the FTC has chosen to ignore the reality of today's dynamic and expanding $200 billion global luxury industry," the company said in a statement. Tapestry said it would acquire Capri in August of 2023. The companies together generated more than $12 billion in sales in 2022.
Tech's earnings bonanza this week shines spotlight on growing troubles at Tesla, Google 2024-04-22 22:32:00+00:00 - Sundar Pichai, chief executive officer of Alphabet Inc., during Stanford's 2024 Business, Government, and Society forum in Stanford, California, US, on Wednesday, April 3, 2024. Justin Sullivan | Getty Images As tech's behemoths get set to report earnings this week, they do so facing a mountain of drama. At Google , there have been protests and restructurings, while Tesla just announced mass layoffs, price cuts and a Cybertruck recall. Microsoft's OpenAI relationship faces fresh scrutiny and Meta's major rollout of its new artificial intelligence assistance last week didn't go so well. The troubling news comes alongside a generative AI gold rush, as tech giants race the technology into their vast portfolios of products and features to ensure they don't fall behind in a market that's predicted to top $1 trillion in revenue within a decade. Wall Street was openly jittery about the upcoming results, pushing the tech-heavy Nasdaq Composite down 5.5% last week, the steepest weekly slump since November 2022. Nvidia , which has emerged as an AI darling, plunged 14%, leading the slide. "Whether this tech selloff continues, I think really depends on how the mega-cap tech reports," said King Lip, chief strategist at BakerAvenue Wealth Management, in an interview with CNBC's "Closing Bell" on Monday. "Valuations have definitely been more reasonable now, now that we've had a little bit of a correction." Lip said that in the last couple of weeks his firm has "trimmed some of our tech exposure." Tech companies have been pouring record sums into emerging generative AI startups and investing heavily in Nvidia's processors to build AI models and run massive workloads. While that market is growing rapidly, investors are growing anxious that other issues at hand could lead to a pullback in spending. On this week's earnings calls, companies are likely to continue highlighting their efforts to cut costs and bolster profits, an efficiency theme that's been running across the tech industry since early last year. Tesla kicks off tech earnings season after the close of trading on Tuesday, with shares of the electric vehicle maker trading at their lowest since January 2023. Meta, coming off its biggest weekly stock slide since August, follows on Wednesday. Microsoft and Alphabet report on Thursday, giving Wall Street a close look at how businesses are planning their budgets for AI infrastructure. Here are some of the biggest issues facing the big tech companies in their reports this week. Tesla A Tesla Cybertruck sits on a lot at a Tesla dealership on April 15, 2024 in Austin, Texas. Brandon Bell | Getty Images Tesla shares fell for a seventh straight day on Monday and are now down 43% for the year. Elon Musk's EV company is expected to report a decline in sales of about 5%, which would be the first year-over-year revenue drop since 2020, when the Covid pandemic disrupted operations. Tesla's earnings follow a bruising quarterly deliveries report and additional price cuts to the company's vehicles and its premium driver assistance system. Last week, Tesla said it was laying off more than 10% of its workforce, and the same day executives Drew Baglino and Rohan Patel announced their departures. "As we prepare the company for our next phase of growth, it is extremely important to look at every aspect of the company for cost reductions and increasing productivity," Musk wrote in a memo announcing the layoffs. Two days later, Musk informed employees via email that the company had sent out "incorrectly low" severance packages to some laid-off workers. And on April 12, Tesla issued a voluntary recall of more than 3,800 Cybertrucks to fix a "stuck pedal" issue depicted in a viral TikTok video. "Since late 2023, sentiment on Tesla (TSLA) has deteriorated," wrote John Murphy, an analyst at Bank of America, in a note on Monday. Meta watch now Meta has been a good bet for investors this year despite last week's slip. The stock is up 36% in 2024 after almost tripling last year, when CEO Mark Zuckerberg told Wall Street that 2023 would be the company's "year of efficiency." But Meta still faces plenty of questions. For one, its Reality Labs division, which houses all of the virtual reality technologies for the nascent metaverse, is expected to show a quarterly loss of over $4 billion for a second straight period. When it comes to AI, Meta debuted its assistant — Meta AI — on WhatsApp, Instagram, Facebook and Messenger last week. It was the company's biggest-ever AI initiative and is set to go up against OpenAI's ChatGPT and Google's Gemini. But Meta AI quickly led to controversy. The assistant reportedly joined a private parents' group on Facebook and claimed to have a gifted and disabled child, sounding off in the comments about its experiences with New York-area educational programs. In another case, it reportedly joined a Buy Nothing forum and tried to do free giveaways for nonexistent items. Now, Meta has to show that it's ready for what's certain to be a heated election season, as President Joe Biden and Donald Trump prepare to square off for a second time. Dating back to Trump's successful presidential bid in 2016, Facebook has been a problematic place for political discourse and misinformation. Meta is expected to report revenue growth of 26% from a year earlier to $36.16 billion, according to LSEG. That would mark the fastest rate of expansion for any period since 2021. Alphabet Sundar Pichai, chief executive officer of Alphabet Inc., during Stanford's 2024 Business, Government, and Society forum in Stanford, California, US, on Wednesday, April 3, 2024. Loren Elliott | Bloomberg | Getty Images On a busy Thursday for tech earnings, Alphabet is likely to capture the most attention. Last week, CFO Ruth Porat announced a restructuring of Google's finance department, a move that will include layoffs and relocations, as the company drives more resources towards AI. On the same day, Google terminated 28 employees, according to an internal memo viewed by CNBC, following a series of protests against labor conditions and the company's contract to provide the Israeli government and military with cloud computing and artificial intelligence services. The dismissals came after nine Google workers were arrested on trespassing charges Tuesday night, staging a sit-in at the company's offices in New York and Sunnyvale, California, including a protest in Google Cloud CEO Thomas Kurian's office. The arrests, livestreamed on Twitch by participants, coincided with rallies outside Google offices in New York, Sunnyvale and Seattle, which attracted hundreds of attendees, according to workers involved. On Thursday, Alphabet CEO Sundar Pichai announced a consolidation of the company's AI teams, including responsible AI and related research teams, under the Google DeepMind umbrella. He said in a memo, "this is a business," and that employees should not "attempt to use the company as a personal platform, or to fight over disruptive issues or debate politics." Pichai has struggled to quell employee discontent on a host of matters since the pandemic, as the company has been forced to reckon with slower growth than in years past and an investor base that's become increasingly concerned with costs. Analysts expect revenue growth of 13% for the first quarter, which would mark a second straight quarter of year-over-year growth in the low teens. For four straight periods, between mid-2022 and mid-2023, expansion was in single digits as advertisers pulled back due to soaring inflation and rising interest rates. Alphabet shares are up 12% this year, topping the S&P 500, which has gained 5.1%. Microsoft Microsoft CEO Satya Nadella (R) speaks as OpenAI CEO Sam Altman (L) looks on during the OpenAI DevDay event on November 06, 2023 in San Francisco, California. Altman delivered the keynote address at the first ever Open AI DevDay conference. Justin Sullivan | Getty Images As for Microsoft, the company seemed to narrowly avoid a European Union antitrust probe into its relationship with OpenAI, after EU regulators had pointed to the possibility earlier this year. Microsoft has invested more than $10 billion in OpenAI, whose ChatGPT chatbot kicked off the generative AI boom in late 2022. AI has been a major focus of Microsoft's earnings calls since then, as the company serves as OpenAI's key technology partner through its Azure cloud infrastructure. Microsoft has invested billions of dollars in AI startup Anthropic as well, and has taken stakes in Mistral, Figure and Humane. The company's position in AI has been the biggest driver behind its ascent to $3 trillion in market cap, passing Apple as the most valuable U.S. company. However, the stock is only up 6.8% this year, trailing many of its tech peers, and some analysts see potential weakness in parts of Microsoft's customer base, notably small and medium-sized businesses. "MSFT has more SMB and consumer exposure than any other stock we cover," wrote analysts at Guggenheim, in a note dated April 21. "And while those cohorts have held up surprisingly well during this soft macro period, we are starting to see some indications of weakening demand from them." Microsoft is expected to report sales growth of 15% in the first quarter, according to LSEG, but analysts are projecting a slowdown over each of the next three periods. WATCH: There's more room for downside in tech stocks
Don't Watch The NFL Draft Alone: Join Benzinga Nation, Step Into A General Manager's Shoes 2024-04-22 22:22:00+00:00 - Loading... Loading... The excitement of the NFL Draft will continue “live” from the world headquarters of Benzinga overlooking downtown Detroit Thursday, where the draft is being held. Members of the Benzinga broadcast team, along with special guests, will be covering every pick in the all-important first round. Aaron Bry, the producer of the "PreMarket Prep" show, will act as a roving reporter in the park below, capturing live reactions from attendees at the draft. While hundreds of thousands of excited fans will be jammed into the park, you can join our exclusive coverage from your own home. Better yet, enter to have a chance to be the general manager of your favorite team while they are on the clock and after the pick has been made. Also Read: Joique Bell To Discuss Journey From Rookie To Prominent NFL Running Back At Benzinga Draft Event When: Thursday, April 25 beginning at 8 p.m. EST until the last pick of the first round. Why Attend: Coverage will be commercial-free, and you just may hear from some top financial analysts who are huge sports fans as well. Loading... Loading... How To Apply: As mentioned above, our company is calling out to Zingernation for guest general managers who will attempt to predict and then scrutinize their respective team's pick. Now Read: Jake Paul's Betr Media Acquires 'Caps Off' Podcast Ahead Of NFL Draft: How The Deal Could Help Sports Content Push Photo: Shutterstock.
Unifying Middle and Last Mile Can Deliver a Customer Experience Revolution 2024-04-22 22:15:00+00:00 - Loading... Loading... By Bart De Muynck The views expressed here are solely those of the author and do not necessarily represent the views of FreightWaves or its affiliates. In the age of e-commerce dominance, customer expectations have skyrocketed. Fast, transparent and convenient delivery are no longer just perks; they have become baseline expectations. To meet these demands, businesses need to optimize every stage of the supply chain. Here's where a crucial shift takes center stage: marrying the middle mile and the last mile. I was in India this week discussing this exact topic with logistics leaders from Europe, the Middle East and India. The speed of delivery is creating additional complexity in the last mile. To solve for this, the middle and last mile need to connect better from a technological and process perspective. Traditionally, the middle mile (bulk transportation between warehouses) and the last mile (delivery to the end customer) have operated in silos. This disconnect creates a frustrating experience for customers. Customers often have no idea where their package is after it leaves the warehouse. This lack of transparency fuels anxiety and frustration. Disjointed operations can lead to unpredictable delivery windows, making it difficult for customers to plan their day around receiving their purchases. Inefficient routing can result in missed deliveries, adding delays and requiring customers to reschedule or pick up packages themselves. By breaking down the silos and fostering a more unified approach, companies can unlock a range of benefits that enhance the customer experience. Real-time tracking throughout the entire journey, from warehouse to doorstep, empowers customers with knowledge and eliminates guesswork. They can track their packages' progress, adjust their schedules if needed and anticipate arrival times with confidence. Optimizing middle-mile logistics translates to faster last-mile delivery. By streamlining routes, consolidating loads and leveraging technology for efficient dispatch, companies can ensure goods reach distribution centers and, ultimately, customers faster. In today's fast-paced world, speed is king, and faster deliveries lead to happier customers. A more efficient middle mile can lead to cost savings that benefit customers. Optimizing routes, utilizing the right-sized vehicles and leveraging data analytics to predict demand allow for more efficient use of resources. These savings can translate to lower product prices, free shipping options or faster delivery tiers, making the overall experience more attractive. A unified approach allows for better demand forecasting and inventory management. Companies can anticipate customer needs and ensure last-mile distribution centers are adequately stocked. This reduces the risk of stockouts, ensuring customers receive their desired items without delays. Additionally, accurate inventory management minimizes waste, leading to a more sustainable supply chain, which resonates with environmentally conscious consumers. Customers are no longer content with a "one-size-fits-all" approach. A connected middle and last mile empowers companies to offer a wider range of fulfillment options, like same-day delivery, click-and-collect services or flexible delivery windows. This level of customization caters to evolving customer expectations and fosters a more positive experience. But the benefits extend beyond efficiency. Marrying the middle and last mile fosters trust and builds stronger customer relationships. Knowing exactly where their package is and when it will arrive gives customers peace of mind. This transparency builds trust and fosters a sense of control over the delivery experience. Real-time tracking allows companies to proactively communicate with customers about potential delays or delivery updates, which demonstrates respect for customer time and reduces frustration. A unified approach also ensures a consistent and predictable delivery experience, regardless of location or product type. This consistency builds brand loyalty and encourages repeat business. We must point out several challenges that exist in achieving this unified vision, such as the need for technology integration, data sharing and standardization. However, the potential rewards are undeniable. By overcoming these challenges, companies can create a future where the middle mile and last mile work in perfect harmony, delivering a customer experience that is not just efficient but transparent, convenient and trustworthy. The post Unifying middle and last mile can deliver a customer experience revolution appeared first on FreightWaves.
The TikTok ban was just passed by the House. Here's what could happen next. 2024-04-22 22:07:00+00:00 - TikTok users could soon find that the popular social media service is either under new ownership or, although it wouldn't happen immediately, outright banned in the U.S. On Saturday, the House passed legislation that would bar TikTok from operating in the U.S. if the popular platform's China-based owner doesn't sell its stake within a year. The bill will next head to the Senate, where it is expected to pass, buoyed by its attachment to a larger foreign aid package for Ukraine and Israel that has gained bipartisan support. TikTok has attracted unwanted scrutiny not only for the addictiveness of its constantly scrolling videos, but also due to its Chinese owner, ByteDance. That has raised concerns among lawmakers and security experts that the Chinese government could tap TikTok's trove of personal data about millions of U.S. users. Meanwhile, TikTok has asked its users to contact their lawmakers to argue against the bill's passage, an effort that appears to have failed to sway opinions in Washington, D.C., noted Eurasia Group director Clayton Allen. TikTok has sent push alerts to users of the social media platform, urging them to contact their lawmakers about a congressional bill that would require its Chinese owner ByteDance to sell it or face a U.S. ban. Aimee Picchi As recently as last week, TikTok was sending push notifications to some of its users urging them to reach out to their lawmakers, saying that the bill could "take away YOUR CONSTITUTIONAL RIGHT to access TikTok." "It's a low-cost exercise if you have access to the user base," Allen told CBS MoneyWatch. "But it seems like it has backfired." Some lawmakers had argued that TikTok's ability to send bulk push notifications to its users, many of them minors, underscored the risks of the app. In a statement, TikTok said it is "unfortunate" that lawmakers are "using the cover of important foreign and humanitarian assistance to once again jam through a ban bill that would trample the free speech rights of 170 million Americans, devastate 7 million businesses, and shutter a platform that contributes $24 billion to the U.S. economy, annually." Here's what to know about what could happen next to the TikTok bill. When will the Senate vote on the TikTok bill? The Senate is expected to take up the bill as early as Tuesday, although the vote could come on Wednesday, said CBS News congressional correspondent Scott MacFarlane. The clock is ticking on a crucial 24 hours for TikTok, as a bill that could lead to the app being banned in the U.S. is now racing through Congress.@MacFarlaneNews has the latest as the Senate prepares to vote on the bill: pic.twitter.com/VdRT2knKY6 — CBS News (@CBSNews) April 22, 2024 President Joe Biden has indicated he would sign the bill, which is primarily focused on providing foreign aid to Ukraine and Israel. Why does Congress want to ban TikTok? Actually, lawmakers want ByteDance to sell its stake in TikTok. Barring such a deal, the legislation would, in fact, ban the social media app in the U.S. Lawmakers are increasingly concerned about the company's ties in China, with fears that ByteDance or TikTok could share data about U.S. users with China's authoritarian government. "The idea that we would give the Communist Party this much of a propaganda tool, as well as the ability to scrape 170 million Americans' personal data, it is a national security risk," Senator Mark Warner, a Virginia Democrat, said on CBS' "Face the Nation," on Sunday. What is the timeline for a possible TikTok sale or shutdown? If passed, the bill would give TikTok's owner nine months to arrange a sale, with the potential for an additional three-month grace period, according to a copy of the bill released earlier this month. But, Allen of Eurasia Group noted, that would put the nine-month mark in mid- to late January, which could also coincide with the U.S. presidential inauguration. If former President Donald Trump wins in November, he could very well take a different tack with TikTok, the analyst noted. "This might become a question for the next administration," Allen said. "Looking at the language of the bill, I'm not sure Trump would be as bound to pursue what the Biden administration would want. He could use it as a point of leverage with China." If TikTok is sold, who might buy it? Likely bidders include Microsoft, Oracle or private equity groups, according to Wedbush Securities analyst Dan Ives. However, Ives think ByteDance would be unlikely to sell TikTok with its core algorithms, the vital software that provides video recommendations to users based on their interests and viewing habits. "The value of TikTok would dramatically change without the algorithms and makes the ultimate sale/divestiture of TikTok a very complex endeavor, with many potential strategic/financial bidders waiting anxiously for this process to kick off," Ives said in a research note. Could other social media platforms benefit from the bill? Rivals such as Meta could benefit from the bill if it becomes a law, Ives noted. Wedbush estimates that roughly 60% of TikTok users would shift to Meta's Instagram and Facebook if TikTok went dark in the U.S. Google would also beneti, he added.
Boeing expects slower production increase of 787 Dreamliner because of parts shortages 2024-04-22 21:56:00+00:00 - Boeing 787 Dreamliners are built at the aviation company's North Charleston, South Carolina, assembly plant on May 30, 2023. Boeing told employees on Monday that it expects a slower increase in production and deliveries of new 787 Dreamliner planes because of supplier shortages of "a few key parts." Boeing has already slowed down deliveries and output of its 737 Max planes in the aftermath of a near catastrophe in January when a door plug blew out from one of the jetliners mid-flight. The company had separately been trying to boost output of 787 Dreamliners after quality problems suspended deliveries for nearly two years, ending in mid-2022. "We continue to take steps to improve the overall health of our production system, putting into action your ideas for improving safety, first-pass quality, training, performing more work in sequence and ensuring our teams have the necessary resources to excel," said Scott Stocker, 787 vice president and general manager, in a memo to staff at Boeing's South Carolina 787 plant. Stocker said Boeing is still facing supplier shortages. "To that end, we have shared with our customers that we expect a slower increase in our rate of production and deliveries," he wrote in the memo, reported earlier by Reuters, adding that the company still plans to increase the rate steadily because of high demand. Boeing was producing about five 787 Dreamliners per month as of late last year and said in January it aimed to get up to 10 a month as early as next year. Boeing is set to report quarterly results and will likely detail its production plans before the market opens on Wednesday.
FTC sues to block Coach parent Tapestry's acquisition of Capri Holdings 2024-04-22 21:46:00+00:00 - The U.S. Federal Trade Commission on Monday sued to block the $8.5 billion acquisition of Capri Holdings by Coach and Kate Spade's parent company, Tapestry . The move by regulators brings at least a temporary halt to a deal that would marry two major names in American luxury retail and put six fashion brands under a single company: Tapestry's Coach, Kate Spade and Stuart Weitzman and Capri's Versace, Jimmy Choo and Michael Kors. With the transaction, the luxury brands could be poised to better compete with European luxury names, such as Burberry and LVMH's Louis Vuitton. In a news release, the FTC said the combined company would harm shoppers and employees. It said Tapestry and Capri "currently compete on everything from clothing to eyewear to shoes." "With the goal to become a serial acquirer, Tapestry seeks to acquire Capri to further entrench its stronghold in the fashion industry," Henry Liu, director of the FTC's Bureau of Competition, said in the release. "This deal threatens to deprive consumers of the competition for affordable handbags, while hourly workers stand to lose the benefits of higher wages and more favorable workplace conditions." Tapestry argued the federal agency "fundamentally misunderstands both the marketplace and the way in which consumers shop." In a statement, the company said it must win the business of consumers who increasingly shop across brands, channels and price points.
Climate change a health risk for 70% of world's workers, UN warns 2024-04-22 21:45:00+00:00 - Heat caused record-high health emergencies last year Heat caused record-high health emergencies last year 00:39 More than 70% of workers around the world face climate change-related health risks, with more than 2.4 billion people likely to be exposed to excessive heat on the job, according to a report released Monday by the United Nations. Climate change is already having a severe impact on the safety and health of workers around the world as excessive heat, extreme weather, solar UV radiation and air pollution have resulted in an alarming increase in some diseases, according to the findings from the International Labour Organization, a U.N. agency. An estimated 18,970 lives are lost each year due to occupational injuries attributable to excessive heat, and more than 26.2 million people are living with chronic kidney disease related to workplace heat stress, the report states. More than 860,000 outdoor workers a year die from exposure to air pollution, and nearly 19,000 people die each year from non-melanoma skin cancer from exposure to solar UV radiation. "Occupational safety and health considerations must be become part of our climate change responses, both policies and actions," Manal Azzi, a team lead of occupational safety and health at the ILO, stated. As average temperatures rise, heat illness is a growing safety and health concern for workers throughout the world, including in the U.S. The Bureau of Labor Statistics estimates environmental heat exposure claimed the lives of 36 workers in 2021 and 56 in 2020. More recently, a 26-year-old man suffered fatal heat-related injuries while working in an open sugar cane field in Belle Glade, Florida, as the heat index hit 97 degrees, the DOL said last week, citing a contractor for not protecting the worker. "This young man's life ended on his first day on the job because his employer did not fulfill its duty to protect employees from heat exposure, a known and increasingly dangerous hazard," Condell Eastmond, OSHA's area director in Fort Lauderdale, stated of the September death. Exposure to environmental heat killed 999 U.S. workers from 1992 to 2021, averaging 33 fatalities a year, according to the Department of Labor. That said, statistics for occupational heat-related illnesses, injuries and deaths are likely "vast underestimates," the agency stated.
Turkey may soon put its controversial Russian S-400 air defenses in operation 2024-04-22 21:38:29+00:00 - By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . You can opt-out at any time. Access your favorite topics in a personalized feed while you're on the go. download the app Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview Turkey may deploy its advanced Russian S-400 Triumf air defenses on the Iraqi border for its planned summer offensive against the Kurdistan Workers' Party, PKK, in Iraqi Kurdistan. Such a move would mark the first operational deployment of the missile system since Ankara received it in 2019 to Western reproach. Turkiye newspaper reported earlier this month that Turkey's S-400s may be deployed on the border, implying it will defend against drones allegedly acquired by the PKK. But the system is effective against bigger threats than crude drones. It's designed to shoot down cruise and ballistic missiles like those fired by Iran in its unprecedented April 13 attack against Israel, and its deployment could worsen tensions with other NATO allies incensed that Turkey even has them. This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. The deal for the S-400 cost Turkey an estimated $2.5 billion. Indirectly, it has cost it far more than that in losses of over $9 billion it could have made from manufacturing over 900 parts for the global F-35 supply chain. Washington banned Ankara from buying F-35s over concerns it would give Russian technicians data that spoils the fighter's stealth. On top of all that, the US slapped sanctions on Turkey's arms procurement agency. Advertisement While enduring these penalties, Turkey never put the S-400 into service. Following the system's delivery, US officials warned Turkey against "activating" it. Turkey tested its F-16s and F-4 fighters against the S-400's radar in late 2019. Washington strongly rebuked Ankara in October 2020 for announcing it was testing the system. Since then, there has been no indication that Turkey's S-400s have been put into operation. In November 2022, then-Defense Minister Hulusi Akar said Ankara has "no problems with the S-400" and that the system "is in place and ready for use." Its purported upcoming deployment on the Iraqi border would be the first time Turkish S-400s have been put into use five years after Ankara received them. Ali Bakir, a Turkey expert at Qatar University's Ibn Khaldon Center and nonresident senior fellow at the Atlantic Council's Scowcroft Middle East Security Initiative, is skeptical of the report but doesn't outright dismiss the possibility. Advertisement "This could be a trial balloon, an operational requirement due to the foreign threat in Northern Iraq, where Turkish troops are stationed, or simply untrue news," Bakir told Business Insider. "If the S-400 is deployed for operational needs, it could be to counter the potential threat of Iran's ballistic missiles." Even though Turkey's other air defenses are capable of combating aerial threats from the PKK, Turkey requires an advanced system for intercepting ballistic missiles fired from Iran. "Considering that Ankara has stationed troops in Northern Iraq, it would be more logical to deploy such a system to protect them during regional escalation or confrontation," Bakir said. "Iran has used missiles lately against Northern Iraq." Related stories Bakir said that the recent missile attacks between Israel and Iran may be a further rationale to deploy the S-400 in Turkey's east."Such deployment will serve Turkey's security as well as the security of Iraq, which is improving its ties with Ankara lately in an unprecedented way," Bakir said. Advertisement Deploying S-400s as a contingency to counter Iranian missiles could create "an extremely complex situation" for Turkey, said Suleyman Ozeren, a lecturer at the American University and senior fellow at the Orion Policy Institute."Such a move might mean that Turkey would be using the Russian weapon system against Russia's most loyal ally in the Middle East," Ozeren told BI. "However, Turkey may use the potential threat of Iran-linked militia groups or PKK as a pretext to deploy S-400s." He predicts a deployment would serve three primary objectives. "First, the S-400s have been one of the most expensive yet least productive policy decisions," Ozeren said. "By deploying them and making a lot of noise about it, the AKP may aim to silence critics at home." The AKP is President Recep Tayyip Erdogan's party, which decided to buy the S-400 in the late 2010s and has defended the contentious purchase ever since. Advertisement "Second, Ankara may want to prove to Moscow that its military cooperation still stands," Ozeren said. "Third, such a decision may aim to send a message to the West — primarily to the US — that Ankara's position vis-à-vis Russia and NATO remains unchanged." He noted the Turkish S-400 is a "standalone system" incompatible with NATO systems, limiting its use and confirming its "high cost and lack of functionality." A Turkish deployment could escalate the lingering dispute with the US. In January, then-Acting Deputy Secretary of State Victoria Nuland said Washington could discuss readmitting Ankara into the F-35 program if it resolves the S-400 issue. Advertisement "The problem is not about where Ankara deploys S-400s but about the S-400 remaining in Turkey's possession," Ozeren said. Bakir argued that weapons are purchased "with the intention of use" for either "offensive or defensive purposes." "Even if Turkey were to hypothetically trade the S-400, the US could still mishandle the case of the F-35," Bakir said. "There is no guarantee that Congress will not attempt to pressure Ankara in the future." Ozeren, in contrast, reiterated that the fundamental problem is Ankara's "purely political" decision to purchase S-400s, which he argued was motivated by the AKP's desire to distance Turkey from NATO. "Such a goal was unattainable and unrealistic given the extent of Turkey's integration into the NATO defense system," Ozeren said. "The S-400 decision has left Ankara in a precarious situation that has remained unchanged." Advertisement "No matter the AKP's motivations back then, reality dictates that the ruling party reverse its course and go back to a stronger alliance with NATO."
German frigate Hessen sailors were on watch 12 hours a day in the Red Sea with only seconds to react to threats in the 'worst case scenario' 2024-04-22 21:34:10+00:00 - A German warship that was part of a European Union security mission has left the Red Sea. The frigate Hessen spent weeks in the Middle East protecting commercial ships from Houthi attacks. Its sailors were on watch for 12 hours a day, Germany's military said on Monday. NEW LOOK Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview Thanks for signing up! Access your favorite topics in a personalized feed while you're on the go. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . You can opt-out at any time. Advertisement Sailors aboard a German warship that was recently deployed to the Red Sea were on watch for 12 hours a day, and in the "worst" situations, they might've only had seconds to respond to the deadly Houthi threats endangering ships in these waters. The Hessen, a Sachsen-class frigate, left the Red Sea and entered the Suez Canal on Saturday after spending nearly 60 days operating in Middle Eastern waters, Germany's military said Monday. The warship was deployed to the region as part of the European Union's Operation Aspides security mission, which has been tasked with protecting commercial vessels sailing off the coast of Yemen from unrelenting Houthi missile and drone attacks. Around 240 crew members aboard the Hessen were on "a permanent war march" during the mission, the German military said in a statement, according to a translation. These sailors were on guard for six hours, then had six hours off, and then went back on guard for another six hours. Advertisement "This very high state of readiness was due to the constant three-dimensional threat" that the Houthis posed to the ships in the area, the German military said. "In the worst case scenario, the ship and crew would only have had about ten seconds to bring their own defensive weapons into effect." The Hessen sailing next to a merchant ship. German military photo The short timeframe underscores how fast some of the Houthi threats are. One sailor aboard a US Navy warship that has engaged the rebels told Business Insider during a visit to the Red Sea earlier this year that their response time to an inbound threat could be anywhere from minutes to just seconds. Related stories Throughout its time in the area of operations, which included the strategic Red Sea, Gulf of Aden, and Bab el-Mandeb Strait, the Hessen repelled four Houthi attacks and escorted more than two dozen commercial ships through the volatile waters, Germany said. In one noteworthy kill last month, a helicopter attached to the warship destroyed a Houthi surface drone after it was identified as a threat to civilian ships. Advertisement "This mission has demanded more from the ship and crew than ever before," the Hessen's Capt. Volker Kübsch said, adding that his warship "worked like clockwork and impressively demonstrated its combat value — right down to its ability to prevail in battle." "Especially in combat situations, we were able to gain valuable, even unique experience not only for ourselves, but also for the entire German Navy and beyond," Kübsch added, highlighting how these engagements are a learning opportunity and a chance to test and improve capabilities. US Navy commanders have expressed similar thoughts on intercepts of anti-ship ballistic missiles. The bridge of the Hessen after an aerial threat was identified. German military photo While the Hessen's presence ultimately proved to be a valuable asset for the EU security mission, there was an incident at one point during the warship's deployment involving an allied asset. In late-February, the Hessen accidentally targeted a US MQ-9 Reaper drone that was operating around the Red Sea and fired several missiles at the aircraft. A technical error in the warship's radar system, however, spared the American combat drone. Advertisement The Hessen is one of several European warships to see combat in the Red Sea this year, alongside the US Navy, which has had an aircraft carrier and multiple other warships stationed in the region since last fall. Beyond intercepting Houthi missiles and drones in the air, American forces, sometimes with partners, have also struck the rebels on the ground in Yemen. The Hessen is due back to the German port city of Wilhelmshaven in early May. The gap it left in Operation Aspides is expected to be filled in early August by the Sachsen-class frigate Hamburg, Germany said.
Phyllis Pressman, Luxury Superstore Matriarch, Is Dead at 95 2024-04-22 21:28:06.730000+00:00 - Phyllis Pressman, the matriarch of the family that founded Barneys New York, the discount men’s wear store turned luxury emporium — and the creator of Chelsea Passage, the store’s home goods bazaar, a pivot point in its evolution from a suit merchant to an elite lifestyle behemoth — died on Tuesday in Palm Beach, Fla. She was 95. Her death, in a hospice facility, was announced by her son Gene Pressman. Barneys was always a family affair. It was named for Barney Pressman, who in 1923 pawned his wife’s ring, at her encouragement, for $500 to buy the lease of a small store on Seventh Avenue and 17th Street in Manhattan. There, he built an empire selling brand-name suits at cut-rate prices. His son, Fred, who took over in the 1950s, transformed the place into an haute men’s retailer that included European designers. Phyllis Pressman, who was married to Fred, began working in the store so she could spend more time with him. Her first intervention was to style the windows, which she thought were boring, adding mannequins and whimsical objects like papier-mâché dogs. Then she began gussying up the interior of the store with antiques, jewelry and housewares, as well as the objects and textiles she found on her travels to the Marché aux Puces in Paris and Portobello Road in London.
Baltimore leaders accuse ship’s owner and manager of negligence in Key Bridge collapse 2024-04-22 21:22:20+00:00 - BALTIMORE (AP) — The owner and manager of the massive container ship that took down the Francis Scott Key Bridge last month should be held fully liable for the deadly collapse, according to court papers filed Monday on behalf of Baltimore’s mayor and city council. The two companies filed a petition soon after the March 26 collapse asking a court to cap their liability under a pre-Civil War provision of an 1851 maritime law — a routine but important procedure for such cases. A federal court in Maryland will ultimately decide who’s responsible and how much they owe in what could become one of the most expensive maritime disasters in history. Singapore-based Grace Ocean Private Ltd. owns the Dali, the vessel that veered off course and slammed into the bridge. Synergy Marine Pte Ltd., also based in Singapore, is the ship’s manager. In their filing Monday, attorneys for the city accused them of negligence, arguing the companies should have realized the Dali was unfit for its voyage and manned the ship with a competent crew, among other issues. A spokesperson for the companies said Monday that it would be inappropriate to comment on the pending litigation. The ship was headed to Sri Lanka when it lost power shortly after leaving Baltimore and struck one of the bridge’s support columns, collapsing the span and sending six members of a roadwork crew plunging to their deaths. “For more than four decades, cargo ships made thousands of trips every year under the Key Bridge without incident,” the city’s complaint reads. “There was nothing about March 26, 2024 that should have changed that.” FBI agents boarded the stalled ship last week amid a criminal investigation. A separate federal probe by the National Transportation Safety Board will include an inquiry into whether the ship experienced power issues before starting its voyage, officials have said. That investigation will focus generally on the Dali’s electrical system. In their earlier petition, Grace Ocean and Synergy sought to cap their liability at roughly $43.6 million. The petition estimates that the vessel itself is valued at up to $90 million and was owed over $1.1 million in income from freight. The estimate also deducts two major expenses: at least $28 million in repair costs and at least $19.5 million in salvage costs. Grace Ocean also recently initiated a process requiring owners of the cargo on board to cover some of the salvage costs. The company made a “general average” declaration, which allows a third-party adjuster to determine what each stakeholder should contribute. Baltimore leaders argue the ship’s owner and manager should be held responsible for their role in the disaster, which has halted most maritime traffic through the Port of Baltimore and disrupted an important east coast trucking route. The economic impacts could be devastating for the Baltimore region, the filing says. “Petitioners’ negligence caused them to destroy the Key Bridge, and singlehandedly shut down the Port of Baltimore, a source of jobs, municipal revenue, and no small amount of pride for the City of Baltimore and its residents,” the attorneys wrote. Lawyers representing victims of the collapse and their families also have pledged to hold the companies accountable and oppose their request for limited liability. In the meantime, salvage crews are working to remove thousands of tons of collapsed steel and concrete from the Patapsco River. They’ve opened three temporary channels to allow some vessels to pass through the area, but the port’s main shipping channel is expected to remain closed for several more weeks.
I visited Chanel's watches and fine jewelry boutique in NYC and saw why the brand is betting on in-person shopping 2024-04-22 21:20:54+00:00 - In February, Chanel opened a watches and fine jewelry boutique on Fifth Avenue in New York City. Peter Marino designed the store with nods to Coco Chanel in mind. The store is bathed in black and gold, drawing the eye to the one-of-a-kind jewelry in the space. NEW LOOK Sign up to get the inside scoop on today’s biggest stories in markets, tech, and business — delivered daily. Read preview Thanks for signing up! Access your favorite topics in a personalized feed while you're on the go. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . You can opt-out at any time. Advertisement As I walked down Fifth Avenue, I was surrounded by the hustle and bustle I've come to expect from one of the most famous streets in New York City. Home to an abundance of luxury stores like Bergdorf Goodman and Tiffany & Co., the avenue is constantly flooded with shoppers from far and wide, and the day I headed to see one of its latest additions was no different. My destination was Chanel's watches and fine jewelry flagship, dedicated to exclusive and vintage jewelry from the brand. According to Robb Report, it's only the fourth Chanel store in the world like it, and renowned architect Peter Marino designed the boutique. Chanel celebrated its grand opening with a star-studded event in February, joining other luxury brands like Saint Laurent and Gucci's parent company Kering in investing in physical retail spaces for high-end clientele. Advertisement I wanted to see what the boutique was like without all the celebrity glitz and glamour, so I used a free Monday to head to the store. The exterior had a luxe look. Samantha Grindell/Business Insider It was hard to miss the two-story boutique thanks to its asymmetrical checkerboard look made of black and textured gold paneling in massive windows. Jewelry sat on busts in the bottom corner under a gold Chanel sign. The store looked luxurious even from a distance, and I felt eager to go inside after I spotted it. A close-up shot of the window display. Gilbert Carrasquillo/GC Images/Getty Images Stepping inside was like being transported to another world When I entered the store, the sounds of chattering tourists and honking cars immediately disappeared. Two doormen lingered by the entrance while several other employees waited nearby to assist shoppers. An employee immediately welcomed me inside as I took in my surroundings, and when I asked for a tour of the space, he seemed more than happy to help. Advertisement The boutique was mostly empty, with just a few shoppers milling around and another sitting with an employee discussing watch options. I got the impression most people came to the store with an appointment in place, though the workers I interacted with were welcoming of me even though I didn't have one. Related stories The exterior color scheme continued inside, with black floors, gold walls, and rugs blending both colors. The ceilings stretched high, adding to its spacious feel that contrasted with the stores I typically frequent in New York. Anna Weyant and Eileen Kelly at the opening of Chanel's watches and fine jewelry store in February 2024. Sean Zanni/WireImage/Getty Images Between the gold detailing and sparkling chandeliers, I felt like I had stepped inside a bottle of Chanel No. 5 as I wandered through the store. Every inch of the place seemed to sparkle. The boutique's distinct scent helped to create the perfume bottle illusion, which an employee told me was unique to the store and couldn't be bought. Advertisement Marino told The Hollywood Reporter that texture and luxury were crucial to the store's aesthetic. "Everything is tactile and gold and special; even the carpets are three-dimensional, a mixture of silk and wool, while the stucco texture on walls was made with people's hands — including my own, you'll find that in the elevator," he told the outlet. Marino also looked to Coco Chanel's interior design aesthetic for the store's design, which blended the simplicity of black and white decor with "ornate Venetian mirrors," he said to The Hollywood Reporter. The boutique emanated luxury As an employee showed me around, my eyes were drawn to the jewelry arranged in free-standing cases and glass displays built into the walls of the store's first floor, which was split into three spacious rooms. Advertisement Of the three rooms on the main floor, one held watches, one had more accessible pieces from Chanel's jewelry line, and the third held rarer pieces from its collection. Workers were waiting to help shoppers in each room, and they all offered me a friendly greeting as I walked by them. Amandla Stenberg at the Chanel watches and fine jewelry opening in February 2024. Sean Zanni/WireImage/Getty Images The space felt more like a cozy gallery than a store. Bottles of Chanel No. 5 were displayed alongside jewelry pieces, some of which aren't for sale. According to W Magazine, several historic Chanel pieces are currently exhibited in the boutique, like the 55.55 necklace. I was reminded of hours spent at museums with priceless art as I took it all in. The second floor featured private VIP rooms where buyers could meet with Chanel staff for more intimate appointments. They were just as lush as the first floor, with built-in TV screens for remote meetings and plush furniture. As I turned to walk back downstairs, a group of shoppers were settling into one of the rooms with an employee, appearing at ease in the luxe space. I didn't know if they were used to being in high-end stores or if the staff just made them feel comfortable, but I could see either being true because the space was somehow both luxurious and inviting. Advertisement Chanel's careful curation of its new space — from a custom scent and attentive staff to the shades of gold bathing the property — made it feel comfortable and inviting. Visiting Chanel's watches and fine jewelry boutique is an experience, which you just can't get online. So, if you plan to walk down Fifth Avenue anytime soon, it's worth popping into Chanel for the look of the store alone.