Apple is trying to close the AI gap
Ahead of Apple's Worldwide Developers Conference on Monday, big questions hang over the tech giant, from sluggish sales of its Vision Pro headsets to growing competition in China and tightening regulation on both sides of the Atlantic.
Those aren't going away, but the event will focus on what Apple CEO Tim Cook will reveal about artificial intelligence and whether the company can keep up with its competitors.
Apple is lagging behind its rivals. Since OpenAI released ChatGPT in November 2022, stock prices of companies considered to be AI leaders, such as NVIDIA and Microsoft, have soared. CEOs of major tech companies are racing to show they are in the race. However, Apple, typical of the company's caution, has yet to announce any new AI products, according to the Wall Street Journal.
(The New York Times sued OpenAI and Microsoft over the use of copyrighted articles related to AI systems.)
Apple tends to keep its future product plans closely guarded. The AI boom has put that strategy under pressure: Cook unexpectedly told analysts last month that the company plans to offer generative AI.
“It's very interesting to see Apple now embroiled in a controversy that doesn't suit them,” technology analyst Leo Gebbie told the Financial Times.
The focus is on Siri. According to New York Times reporter Tripp Mickle, Apple has inked a deal with OpenAI to incorporate the company's technology into iPhones in order to make Apple's digital assistant more capable and conversational.
Apple takes privacy and security seriously. What we expect from the company The company's products are more secure because many functions are processed on-device rather than in data centers, addressing growing consumer concerns that large language models can sometimes misuse data.
The company has a track record of being profitable despite being late to market.The iPhone and Apple Music are just two examples, and the reason is that with such a huge user base, any new technology the company releases can have a huge impact on consumers and developers.
Bloomberg reported that Monday's announcement could also signal a broader push into hardware, and that Apple is still in talks with Google to further strengthen its AI offerings.
Investors are not giving up hope yet. The company's stock price has risen since Cook announced AI products are on the way, but not as much as Nvidia's or Microsoft's, suggesting it's too early to give up on Apple.
What's going on?
The euro and European stock prices fell as the election results came in. The parties of French President Emmanuel Macron and German Chancellor Olaf Scholz suffered crushing defeats in this weekend's European Parliament elections, threatening existing climate and immigration policies, prompting Macron to call early parliamentary elections and European Commission President Ursula von der Leyen to scramble to gather votes to stay in power.
Inflation and the Fed are big issues for investors this week. The central bank is widely expected to keep interest rates unchanged at its Open Market Committee meeting on Wednesday. But consumer price index data will be released before the meeting, providing policymakers with the latest inflation data. After Friday's shock release of employment data, the big question is whether the Fed will cut interest rates before Election Day on November 5.
Norway's sovereign wealth fund plans to vote against Elon Musk's compensation package. The investment giant is the latest institutional investor to say it will vote against a bill to reauthorize Tesla's CEO's multibillion-dollar compensation contract. Thursday's vote will be closely watched for what it means for Tesla's future, especially if Musk refocuses on other parts of his business empire.
Will Smith has broken his box office losing streak. “Bad Boys 2” beat expectations by grossing more than $56 million domestically during its opening weekend, boon for Hollywood, which has been worried about the underperformance of films like “Furiosa,” which was expected to be a blockbuster, and for Smith, whose career took a hit after he slapped Chris Rock at the 2022 Oscars.
New developments in ammunition bidding war
Vista Outdoor shareholders were scheduled to vote on Friday on whether to sell the company's ammunition business to a Czech company, but rival bidder MNC Capital was trying to block the deal.
The vote has been postponed, but Vista continues to oppose the MNC takeover and is expected to say it is currently under review. another It submitted a bid to acquire the ammunition division.
Vista announces that an unidentified bidder has made an offer to acquire the company for more than $2 billion. Known as the Kinetic Group, which owns brands such as Remington and CCI, the company did not provide many details about its new partner, other than to say it is a “U.S.-based investment firm” that had previously made a takeover bid for Kinetic.
Vista is expected to say the new bid was “reasonably expected” to exceed the $1.96 billion contract it signed with the Czechoslovak group, and that a contract with the unidentified bidder could be signed by June 14.
Meanwhile, Vista has rejected the latest takeover bid from an MNC. It recently increased its offer for the entire company to $3 billion. MNC claims that not only is it offering better terms than CSG, as the Czech company is known, but that it is not subject to the national security review that CSG's bid is undergoing.
Vista has consistently opposed the split, arguing a split would create greater value for shareholders. It has received backing from influential proxy advisory firm Institutional Shareholder Services, which recommended investors support the CSG deal.
Shareholders seemed unconvinced that MNC's takeover bid would succeed: Vista shares closed at $35.78 on Friday, below the proposed price of $39.50 a share.
Vista postpones shareholder vote to July 2 To allow more time for negotiations with new bidders.
Focus on Redstone
This could be a defining week for the Redstone family: The media dynasty must decide whether to sell its stake in Paramount, the entertainment empire that includes CBS, MTV and the “Top Gun” film studio.
Advisers were working on a possible deal with Skydance Media throughout the weekend, three people familiar with the matter told DealBook's Lauren Hirsch and The Times' Ben Mullin, who asked not to be identified discussing confidential information.
The deal will be complicated. The plan involves two stages: Skydance would first acquire a controlling stake in National Amusements, which owns the Redstone brothers' stake in Paramount, and then merge the media conglomerate with Skydance itself. Advisers for Skydance and National Amusements are working out mechanisms to give the Redstone brothers additional legal protections, including compensation and whether to give minority shareholders voting power.
As of Sunday night, the National Amendments had not planned to vote, leaving other parties in limbo.
Redstone has other optionsThe bidding group included producer Steven Paul, perhaps best known for the “Baby Genius” series, and tequila and hair care entrepreneur John Paul DeJoria is also approaching National Amusements.
Those potential buyers would likely face less regulatory scrutiny than Skydance, but they also might not be able to offer the same investment capital or technical expertise as Skydance, whose founder is David Ellison, the son of Oracle co-founder Larry Ellison.
Football diplomacy of Chinese EV giant
There is sure to be further drama in Brussels on this issue, with the aftermath of this weekend's European elections likely to deal a particular blow to Europe's ambitious climate plans. and At the soccer field since Friday.
Around the same time, the Euros (officially the UEFA European Championship) kicks off in Germany, a month-long soccer tournament expected to draw a television audience of 500 million people, and it has an unlikely sponsor: BYD, the fast-growing Chinese electric-car maker that is beating many of Europe's car makers with its low-cost models.
The European Union may attack Chinese EV makers before the first round. By Vivian Walt, DealBook. The European Union is expected to decide as early as this week on whether to impose tariffs on companies subsidized by the Beijing government, including BYD, in a bid to rebalance the continent's auto market.
This would be the latest example of a tough stance from Western countries against Chinese-made EVs. The Biden administration has called the vehicles a “national security threat” and banned them from the U.S. market.
And ahead of the EU elections, Renault Group CEO Luca de Meo warned that Chinese competitors could sink Europe's auto industry.
Europe cannot afford a trade war. China has threatened to retaliate against high EU tariffs, possibly on European car, aircraft and pork imports, which would particularly hit German automakers such as Volkswagen and BMW, which have big business in China and want to avoid trade barriers, potentially causing divisions among European manufacturers that Beijing may seek to exploit.
At the same time, the EU wants to encourage the sale of EVs to help meet its climate targets for 2035. French far-right politician Fabrice Leggeri told France 24 television last night that the policy was a gift to Chinese EV companies.
The EU may start with minor penalties. Analysts have suggested the EU could impose interim tariffs of around 20 percent on Chinese companies, leaving room for Beijing and Brussels to negotiate later this year after the newly elected EU Parliament selects the European Commission president and trade chief.
“The Commission is going to have to strike a very careful balance between giving domestic producers a competitive advantage and allowing them to catch up in this innovation race that they have completely missed out on,” David Kleiman, a trade expert at Brussels think tank ODI, told Dealbook.
The big problem is China's dominance of the EV supply chain. Manufacturers can sell cars for a fraction of the price of Western models and still make a profit. Kleiman said that unless EU tariffs exceed 40% or 50%, there “will not be a significant impact” on Chinese EV makers' revenues.
BYD, on the other hand, will soon have a huge customer base. The company's logo will be featured throughout televised matches and its EVs will be displayed in host stadiums and fan zones across Europe.
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