Strategic Deposit
Acquisition

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Your Journey to
Mortgage Tech Go Live

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Evaluating & Selecting
a Consumer Loan
Origination System

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SoftBank revealed its Vision Fund 1 public portfolio companies delivered a 2.1% value decrease during the quarter because Coupang’s stock value suffered a drop. The value of private company investments from SoftBank decreased by 3.3% throughout the recent reporting period. The fair value evaluation of SoftBank’s entire portfolio reduced by a total of 2.8% since the previous quarter reached its end.

The Japanese company has been making a lot of controversial investments in struggling companies. To strengthen its portfolio, SoftBank’s semiconductor chip manufacturer Arm Holdings Plc is acquiring Ampere Technology.

SoftBank Vision Fund Weighs on Performance

The main factor behind SoftBank’s quarterly loss was the Vision Fund investments that experienced a substantial decline. The fund proceeded with its second successive quarterly portfolio downfall because several leading investment holdings battled difficulties. The company referred to macroeconomic uncertainties and fluctuating interest rates along with weak public market conditions to explain the financial slide.

SoftBank’s profit and losses continue to worsen due to significant difficulties experienced by its prominent investments in WeWork and Chinese technology companies. The bankruptcy of WeWork alongside Chinese regulatory challenges has depleted value across some of the fund’s investments which deepens the fund’s financial losses.

Revenue Miss Adds to Pressure

SoftBank’s revenue achieved $10.7 billion in the period but failed to meet predictions from analysts. The company has been working to streamline its operations to ride the AI wave to compete with players like Nvidia. To achieve this, Softbank made an investment of $1.5 billion in Open AI. Through this investment the ChatGPT founder, the Japanese Company has become the biggest investor in Open AI, surpassing Microsoft.

However, SoftBank executives maintain a positive outlook for their long-term strategic objectives even after the third quarter financial loss. SoftBank executives declared their dedication to AI-driven investments and strategic partnerships which will position the company for potential future growth. SoftBank faces ongoing market volatility that creates an uncertain business environment during the upcoming short term.

SoftBank’s third-quarter loss shows how its investment-oriented approach exposes shareholders to extreme market volatility. SoftBank’s financial stability in upcoming months will depend heavily on the success of Vision Fund operations as the company continues AI investment initiatives.

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According to CNBC, TotalEnergies fourth quarter profits for 2024 were $4.4 billion. Although the fourth quarter profits were down by 15% from $5.2 billion in comparison to 2023, it was still more than the Q3 profits, which were at $4.1 billion.

The company said it is expecting higher gas prices, upstream production and power sales in 2025. After the statement, TotalEnergies shares saw a surge of 1.3% on January 25th, 2025 at 8.42 AM.

CEO Patrick Pouyanne said at a press event, “I expect the company to be able to continue investing in renewable energy in the U.S., and exports of U.S. LNG is set to practically double in the coming years.”

TotalEnergies Strengthens LNG Position

French oil major TotalEnergies keeps expanding its LNG business while building dominance in the industry through strategic global development. Through strategic investments in LNG facilities and export development the company strengthens its contribution to worldwide energy protection. TotalEnergies is the largest LNG exporter in the U.S., with over 10 million tons secured through contracts.

LNG demand shows strong growth mainly because European and Asian countries aim to stop depending on Russian energy. Total announced a 7% increase in its 2024 dividend, raising it to 3.22 euros per share, and confirmed $2 billion in share buybacks per quarter for 2025.

TotalEnergies Profit Outlook

TotalEnergies expects profit surge in 2025 because the organization follows a balanced approach toward energy creation. The French oil company operates its oil and gas demand while actively implementing speedy development of renewable energy projects which include solar power wind energy and hydrogen technology.

The company’s long-term vision emphasizes sustainability and profitability, ensuring that it remains a leader in the energy landscape. With a strong fourth-quarter performance and promising projections for 2025, TotalEnergies continues to demonstrate resilience and adaptability in a changing market.

TotalEnergies amazing fourth quarter profits showcase how the company uses strategic operational methods to tackle market difficulties and turn them into growth prospects. TotalEnergies as a French oil major faces an important role in the coming years because its strategic decisions will determine its future direction in LNG and renewable expansion. TotalEnergies Profit shows strong potential for the future because it receives backing from the U.S. largest LNG exporter sector while maintaining a positive financial projection.

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No Quick Fixes

Intel’s Q4 earnings report shows that the company’s sales revenue reached $14.3 billion. Executives in the company attributed the spike in sales to high orders from Asia as they sought to get Intel chips ahead of US tariffs. However, the company expects its first-quarter earnings to fall short of analyst estimates due to loss of market share and weaker demand for Intel AI chips.

Intel’s Q4 revenue growth has attracted positive reactions from investors. The realistic tone set by the interim CEOs in the chip maker has also struck a positive code with investors.

“There are no quick fixes. As co-CEOs, you can expect us to be very straightforward and direct. We only make commitments we are confident we can deliver,” Intel Interim co-CEO and Chief Product Officer Michelle Johnston Holthaus said during the earnings call.

Holthaus and her co-CEO said they’ve focused on improving the company’s manufacturing process and products in order to compete in the chip market. The company is also working to improve its finances.

The semiconductor giant expects its quarter-one revenues to range between $11.7 billion and $12.7 billion. This is less than the $12.85 estimated by analysts. Intel’s conservative estimates reflect the fierce competition it continues to face in the chip industry and reducing demand for its products. The company announced a loss of 3 cents per share in quarter four. Intel shares have lost over 50% of their value over the last year.

Leadership Wrangles

Although Intel’s Q4 earnings were better than expected, they are the lowest that the company has recorded in more than a decade. Intel’s declining revenues have been attributed to the leadership challenges that it experienced. In December 2024, the Intel board pushed former CEO Pat Gelsinger out after his high-cost turnaround plan failed.

Initially, investors supported his plan to restore the company’s dominance in manufacturing. But they deserted the company when its spending on equipment, new plant and research strained their finances. Gelsinger addressed the spending issue partly by cutting 16,000 jobs. The company’s competitors exploited the AI shift in the industry.

This further eroded the big market share that Intel once held. Intel has been, until recently, the world’s biggest chip manufacturer. To restore its top-line growth, the company has to shift to AI accelerator production to improve its chips.

The company did not update analysts on the progress it has made in the search of a new CEO. The incoming CEO will be expected to make key decisions, including the option of breaking up Intel functions. Intel rivals are already looking to bid for the entire company or parts of it.

Shrinking Market Share

Intel is facing stiff competition from leading semiconductor manufacturers like Taiwan Semiconductor Manufacturing Company (TSMC), Nvidia, and Advanced Micro Devices (AMD). Nvidia is currently generating over $100 billion annually from the sale of accelerator chips.

To date, the company has not been able to manufacture a viable alternative to the accelerator chips produced by Nvidia. Holthaus told analysts that although the company’s new PC chips compare favorably with those produced by rivals, Intel has to work towards providing better chips for data centers.

“We’re fighting really hard to close the gap. We certainly have more work to do,” she said.

AMD is taking over Intel’s server processor and personal computer market share while other firms that use smartphone-derived processors are tapping into Intel’s largest market. Intel’s competition landscape has been complicated further by the fact that TSMC has taken on its major strength by offering outsourced production services to rivals.

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According to Reuters, Samsung’s Q4 earnings were impacted by the rising research and development costs. Samsung’s shares hit the lowest in the past four years in November 2024 which could also be one of the reasons for the reduced Q4 profits.

Struggling Chip Division

Samsung’s semiconductor business faced a significant setback in the fourth quarter. Weak demand for memory chips and intense competition in the advanced chip market also affected its performance. Further, the delay and inefficiency in producing Samsung AI chips have added more strain to its earnings.

According to industry experts, Samsung is struggling to maintain its edge after a series of new changes as rivals like Nvidia capitalize on this surging demand for AI-focused chipsets. Samsung vs Nvidia is now at its peak, with Nvidia gaining ground in the market through its latest AI and GPU technologies.

Lee Min-hee, an analyst at BNK Investment & Securities, “We knew that the Q4 performance was bad, so I should say that it was reflected (in the stock price) to some extent. There are concerns about Samsung’s major businesses continuing to lose competitiveness. But chip demand may have bottomed already.”

Revenue Expectations Below Market Forecasts

Samsung estimated an operating profit of 6.5 trillion won in the fourth quarter. This is lower than the LSEG Smart Estimate market forecast of 7.7 trillion won. Though Samsung’s estimated Q4 profit is 131% more than the previous year, it is 29% less than the Q3 profits.

Analysts said one weakness in Samsung’s strategy was that the firm has heavily depended on conventional memory chip sales. Especially, the eternal growth in the smartphone and data center market combined with the company’s efforts to diversify a portfolio of chips designed, such as AI chip solutions, has not paid off yet.

Nvidia CEO Jensen Huang told the reporters of Korea JoongAng Daily in LasVegas on Tuesday, 7th January 2025. “Samsung has to “engineer a new design” to supply HBM chips to his company, adding that “they can do it and they are working very fast.”

Greg Noh, an analyst at Hyundai Motor Securities said, “Samsung’s earnings outlook was worse than expected, with profit possibly eroded by one-off costs as well as disappointing chip and display results. I think it will take time for Samsung to supply HBMs to Nvidia”

Way Ahead for Samsung

Reduced Q4 earnings signals an immediate need for Samsung to rethink its semiconductor strategy. The Korean tech giant has vowed to speed up investments in emerging technologies such as AI and high-performance computing, which is to regain pace.

Although the delays in the Samsung AI chip have been a disappointment, company executives are optimistic about the long-term potential. They look forward to building stronger partnerships and enhancing research and development to address the growing demand for cutting-edge solution

Samsung’s reduced Q4 profits serve as a wake-up call because of rising pressures from competitors such as Nvidia within the industry. Overcoming its current chip division problems will help the company to regain investors’ confidence and its status as the global leader in semiconductor innovation.

Notable here are problems with Samsung’s AI chip manufacturing, as well as intense competition in the market of advanced chips, which emphasize that strategic turns would be in place for 2025 and ahead.

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According to Reuters, this is the first time the giant smartphone manufacturer is buying back shares since 2017. In total, the company plans to buyback 10 trillion shares. Out of these, 3 trillion shares will be bought back and canceled over the next three months.

A Phased Buyback Plan

Samsung Electronics board of directors authorized the share repurchase program. The company says the Samsung buyback program will be implemented in phases over the next year.

The first phase will commence on November 18, 2024, to February 17, 2025. The buyback will involve repurchasing 6.91 million preferred shares and 50.14 million common shares. The board of directors will be making a decision on strategies for enhancing shareholder value. This includes how and when to leverage the remaining 7 trillion shares in the buyback program.

Samsung’s buyback plans coincide with growing investor concerns regarding its memory chip business. The company’s memory chip unit is struggling to catch up with its smaller rival, SK Hynix Inc. In recent years, SK Hynix has become the main supplier of high-bandwidth memory to AI chip giants like Nvidia Corporation. Nvidia uses the top-notch chips in its popular AI accelerators.

Focus on Shareholders

Samsung’s stock repurchase program will help improve the company’s share performance and give shareholders value in the short term. However, analysts say the smartphone giant needs concrete plans to support share performance.

Park Ju-gun of Leaders Index says the share buyback plan is a reflection of the crisis that the chip giant feels due to the sharp drop in Samsung share prices. Last month, the company apologized to shareholders for reporting disappointing quarterly profits. The company trailed behind rivals in selling AI chips to Nvidia.

Samsung stocks featured among the worst performing in the leading global chipmakers category. The company has also been affected negatively by threats by President elect Donald Trump to increase tariffs on imports as that will affect demand for electronic products in the US.

Company Outlook

Samsung share prices gained 7.2% on Friday, November 15, 2024, after hitting their lowest price in four years on November 12, 2024. Analysts attributed the stock price decline to rising concerns over introduction of new US tariffs under the Trump administration.
This is the biggest jump since March 2020. The global smartphone maker continues to grapple with a consumer electronic slump. Investors are still cautious about the company’s outlook.

“A lower valuation is justified given trade risks around Korea and also the catch-up in HBM, which will take time, and a weak memory environment. There are better tech stocks to own here, most of them are in Taiwan,” Sat Duhra, Fund Manager at Janus Henderson Group said.

Last month, the company reported progress in qualifying and supplying advanced AI memory chips to Nvidia. It expects to ship HBM3E, its most advanced chips in quarter four of this year.

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Impact of U.S. Tariffs on Samsung

As Samsung was unable to take advantage of the growing demand for AI chips, Samsung Electronics shares have not performed well. Its share has been seeing a continuous dip in comparison to its global competitors, TSMC and Nvidia, this year, according to Reuters.

Lee Min-hee, an analyst at BNK Investment & Securities, said, “Trump’s potential tariffs on Chinese imports are seen dealing a bigger blow to Samsung, which has a higher reliance on Chinese customers than its local rival SK Hynix.”

With these new tariffs on Chinese companies under the Chips Act, Samsung Electronics may suspend its supply of 7nm and sub-7nm AI chips to Chinese clients. Although Samsung has refused to comment on the situation, the company has notified its Chinese clients of a halt in the OEM of these relevant AI chips.

Rising Tensions Over Global Tariff Threats

Greg Noh, an analyst at Hyundai Motor Securities said, “Trump has threatened to impose a universal 10% tariff on imports and 60% on Chinese goods, which would reduce demand for electronics products that use chips.” Such a move would have a direct impact on Samsung’s business and its global competitiveness.

Last week, President Yoon Suk Yeol of South Korea, also raised concerns about the Trump administration’s threat to increase tariffs on Chinese exporters. Yoon also said that higher tariffs would make the Chinese exporters to lower their prices, increasing competition for Korean chipmakers like Samsung in the global market.

Samsung Stocks Fall Amid Global Competition

Samsung Electronics shares have seen a 34% drop this year, making it the company’s worst annual performance in the past two decades. While the shares of SK Hynix have risen by 32%, U.S. chipmakers Nvidia also saw a 199% surge in their stock prices.

In early trading on November 13th, 2024, Samsung shares hit their lowest point since 24th June 2020, with a 2.5% dip to 51,700 won. Meanwhile, SK Hynix saw a 2% gain after two consecutive sessions of losses. The wider KOSPI market also dropped by 1.5% on the same day.

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According to Yahoo Finance, this amount is about $992 million less the amount projected by analysts.

The Underlying Factors

Rivian’s revenue drop was attributed to disruptions in production and the challenging consumer environment. The company has been facing a range of challenges that included safety problems, supply chain challenges, and reducing demand for electric vehicles as consumers take caution due to uncertainty in charging and cost options.

During Rivian’s earnings call with analysts, the company’s CEO and founder, RJ Scaringe termed the Q3 as tough. He said the EV maker Rivian revenues dipped because the company spent a lot of time fixing hiccups in the supply chain. Scaringe told analysts that the issue was short term.

Bracing for Uncertainty

Even with the slowing demand for EVs in the US, manufacturers are bracing themselves for more uncertainty following Donald Trump’s election to the White House. Although he has softened his EV criticism following Tesla CEO’s support, Trump has previously considered removing the $7,500 tax credit for EV purchases.

Although income requirements disqualified some customers, people who hired Rivian vehicles had been leveraging the tax credit. With Trump’s presidency, there is a chance that more tariffs will be introduced on imported products. Scaringe said that Rivian is focusing on working with suppliers who will not be subject to huge tariffs to overcome this challenge.

“There’s a lot of policy elements here that are in play and we’re watching it very closely,” he said on the call.

Market Performance

Rivian’s sales drop has been reflecting on its year-on-year stock performance. The company went public in 2021. Its share price dropped by 42% in 2023. On November 7, 2024, the company’s stocks closed at $10.04.

Last month, Rivian’s share price dipped after the company failed to meet its quarter three expectations and reduced its production estimates due to miscommunication with copper windings supplier. The company manufactured 13,157 EVs in its Normal III manufacturing plant. However, it delivered 10,018 EVs in quarter three. Overally, Rivian’s third quarter net loss stood at $1.1 billion, compared to the $1.4 billion it reported the same period last year.

As the EV manufacturer maneuvers its way to profitability, it has signed high-profile deals with Volkswagen Group and Amazon. The EV maker is working on a joint venture with Volkswagen in quarter four. The agreement will see the German automaker invest $5 billion in the EV maker this year. On November 7, 2024, Rivian said it had entered into a partnership with LG Energy Solution to supply cylindrical battery cells.

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Digital Transformation
in Lending: Progress &
Potential

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Strategic Deposit
Acquisition

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