Technology Battle: Huawei's 2024 earnings spike by 22% in spite of US penalties

Huawei's revenue of US$118 billion last year was their second largest on record, signifying a 22% annual increase.

The Chairman of Huawei, Howard Liang Hua, stated that the company's performance in 2024 was up to par, attributing the success to the expansion of its consumer business, encompassing smartphones and wearable tech, as well as the swift development of its smart car solution operations.

Huawei's revenue for 2024 was the second largest in the company's history, only surpassed by their record-breaking earnings of 891 billion yuan in 2020. This peak in revenue occurred after the US initially placed sanctions on Huawei's profitable mobile phone and international business units.

Huawei's most recent earnings show a strong 22% annual growth from the 704.2 billion yuan reported in 2023. Although Huawei is not a publicly traded company, it consistently shares its financial information.

Liang revealed the figures at a convention organized by the Guangdong provincial administration in Guangzhou, however, the chairperson did not share the yearly earnings for that period.

The inclusion of DeepSeek into ClouDr's medical AI platform triggers an increase in stock value

The Chinese firm asserts that DeepSeek's AI model will boost data extraction on its platform, providing efficiency to hospitals and pharmacies.

Stocks of Chinese digital health firm ClouDr Group increased for another day following their announcement that they have integrated DeepSeek's AI technology into their system to enhance effectiveness in hospital and pharmacy procedures.

The incorporation of the DeepSeek R1 model into the medical AI system, ClouDr Brain, would enhance the system's ability to extract data, thus improving the way clients manage patients with long-term illnesses, stated Kuang Ming, Chairman and CEO, in an announcement to the Hong Kong stock exchange on Thursday.

Shares of ClouDr saw an increase of 3.7% to HK$1.67 this past Thursday, with a spike of up to 27.3% shortly after the market's opening. The previous day, the stock had surged by 26.8%. When ClouDr first went public in the middle of 2022, its shares were introduced at HK$30.50.

After the integration, using ClouDr's more than 1 billion digital health records, the firm's ClouD GPT and ClouD DTx systems will be enhanced specifically in the areas of medical knowledge graph and clinical support system. The aim is to boost user experience and improve the accuracy of diagnosis, as stated by ClouDr.

ClouDr and DeepSeek both have their headquarters located in Hangzhou, in the eastern region of China's Zhejiang province.

DeepSeek propels a surge in Chinese tech stocks as the valuation difference lessens against the 'Magnificent Seven'.

Investors suggest that the rally in the stock market, triggered by DeepSeek, has more potential due to its appealing valuation and superior innovation.

The Hang Seng Tech Index, with major members like Tencent Holdings, Alibaba Group Holding, and Xiaomi, neared a peak not seen for four months on Thursday, following an increase of over 10% in the last two weeks. Meanwhile, the wider Hang Seng Index experienced a rise of around 6%.

Alibaba, who owns the Post, saw a two-fold increase during the same time frame, following an announcement that its cloud-based computing division had incorporated DeepSeek's AI model into its operations. Meanwhile, mobile phone manufacturer Xiaomi's worth rose beyond HK$1 trillion (US$128.4 billion). Investors heavily invested in data service company Merit Interactive in Shenzhen, triggering a maximum daily increase of 20 per cent since the reopening of China's domestic markets on Wednesday, following the Lunar New Year break.

The recent resurgence could indicate a shift in attitude within the technology industry, which has experienced decreased expenditure and strict regulation on fintech procedures in the past four years. The recent surge in Chinese tech stocks could potentially continue due to their attractive valuation and innovative nature, despite numerous restrictions from the US, according to some financial advisors.

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Could China's affordable DeepSeek signal the decline of Nvidia's chip supremacy?

"Chinese stocks, particularly in the tech industry, come at a considerably lower price than their American equivalents," stated David Chao, a strategist at US investment firm Invesco. "Just as the AI development disparity is closing, the difference in stock value is also decreasing."

According to data from Bloomberg, the average price-to-earnings ratio for the 30 companies included in the Hang Seng Tech Index stood at 20.5 times. The seven major US companies – Nvidia, Apple, Amazon.com, Alphabet, Microsoft, Meta Platforms, and Tesla – had an average trade multiple of 41.4 times.

McKinsey faces scrutiny to reevaluate its China business due to escalating US conflicts. Partners express worry over the company's operations in mainland China and are confident that their North American operations could adequately compensate for a potential withdrawal from China.

Partners at McKinsey & Co are reevaluating the consulting firm's operations in China. They have expressed concerns about the potential risks involved due to escalating tensions between China and the US, leading them to question whether it's profitable to maintain business in the Asian nation.

Several high-ranking associates have been expressing these worries since the end of the previous year, even preceding Donald Trump's re-election where he vowed to intensify the strain on China, as per sources acquainted with the situation. These associates contend that the profitable business in North America can sufficiently compensate for any withdrawal from China, stated a few of these sources, who wished to remain anonymous as the specifics are confidential.

The initiative to reduce the unprofitable Chinese business contradicts the view of global managing partner Bob Sternfels. He believes the company should uphold its global presence, encompassing offices in approximately 130 cities within 65 nations.

"Opting for a global approach is a decision," Sternfels conveyed to his employees in a memo towards the end of last year, which Bloomberg News had access to. "Honestly, it's the tougher decision to take. I'm aware this is challenging and it might get even more so."

The memorandum was not a reaction to any internal worries regarding China, but the discussion highlights the predicament many prominent international companies find themselves in, as they are stuck in the political conflict between the globe's two biggest economies. The race to dominate in all sectors, ranging from computer chips to vehicles, along with new import duties, presents further challenges for American companies operating in China.

During his initial tenure, Trump took a hard line against China, hiking tariffs by an additional 10 per cent this week, which resulted in reciprocal actions from Beijing. Trump's State Secretary, Marco Rubio, has explicitly expressed his disapproval of the governing Communist Party, urging the US to adopt a firmer stance against China in terms of economy and defense.

Standard Chartered is revolutionizing the investment experience with customized multi-asset strategies and advancements in financial technology. By integrating advanced digital platforms with personalized investment strategies, they are able to cater to the varying requirements of both individual and professional investors.

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The positive impacts of fintech innovation are substantial and game-changing. Understanding that it not only enhances banking by making it more inclusive, accessible, and secure, but also drastically improves customer experience, Standard Chartered persistently revamps its digital services. Simultaneously, it pushes forward with product development to generate unique offerings for its more sophisticated clients.

Standard Chartered Group's notable achievements in the third quarter of 2024 can be attributed to their emphasis on innovation and customer-focused approach, evidenced by a 32% annual increase in their Wealth Solutions income. The growth was bolstered by a robust influx of new affluent customers joining the bank, with an average estimate of about 65,000 new wealthy clients every quarter.

The increase in Net New Money (NNM) was reported at 67 per cent compared to the previous year, totalling US$10 billion at the end of the third quarter in 2024. Meanwhile, assets under management (AUM) for affluent clients hit a high of US$320 billion. The bank's Wealth AUM also saw a 13 per cent boost. These figures showcase the bank's extensive growth in various market segments and products.

"In Hong Kong, our commitment to comprehending customer requirements and remaining in sync with market shifts ensures our leading position in fintech innovation," stated Alson Ho, the Managing Director and Head of Wealth Solutions at Standard Chartered Hong Kong (the Bank).

"As the Bank keeps striving towards its digital goals, customer contentment remains the focal point of its comprehensive plan."

DeepSeek's expansion in China surpasses ByteDance's Doubao in the competition for AI applications. In January, DeepSeek reported a daily user count of 22.2 million, outdoing Doubao's 17 million. However, it still lags behind the owner of TikTok in terms of monthly users.

DeepSeek AI, the flagship AI assistant of the company, which is available to users as a free application, recorded an average of 22.2 million daily active users in January. This figure outstripped that of Doubao, which had 17 million DAUs during the same timeframe. This information was gathered from Aicpb.com, a site that monitors the worldwide popularity of AI services.

DeepSeek's chatbot became well-known following the launch of its R1 reasoning model a month ago. This model either equalled or exceeded OpenAI's o1 reasoning model in certain standard assessments. Similar to V3, the R1 is available at no cost on the DeepSeek app, whereas OpenAI's o1 initially necessitated a monthly subscription fee of $20 for restricted usage upon its debut.

A potential default by a developer in Hong Kong could trigger instability in the real estate market, warns S&P. The credit-rating firm suggests that the recovery of Hong Kong's housing market might be losing momentum.

The credit-rating agency announced in a report on Thursday that the rebound of Hong Kong's housing market might be fading. S&P Global Ratings suggests that any significant issue involving key Hong Kong property developers could initiate a domino effect, undermining the financial stability of rated organizations and increasing the risk for bondholders.

The real estate market in Hong Kong, even with some progress in the previous year, continued to grapple with an overabundance of new properties and sales rates that fell short of predictions, as reported by Centaline Property Agency.

In the year 2024, the construction of new homes reached a figure of 24,261. This number marked a 75% rise from the previous year, 2023, hitting a two-decade peak, as reported by Yeung Ming-yee, a high-ranking associate director at Centaline. However, only approximately 50% of these newly built homes were sold, a significant drop compared to the 80% sales rate experienced from 2014 to 2021.

"Yeung emphasized that the surplus of existing properties hasn't seen any improvement. He mentioned that it would require some time to manage the sale of completed units. He also predicted a continued low percentage of initial sales in the near future."

Hong Kong's NWD offers State Pavilia residential units in North Point at a massive markdown

The Hong Kong-based developer, grappling with a debt of US$16 billion, has priced 88 residences at an average of HK$18,540 per square foot, marking the lowest rate in the area over the past eight years.

On Thursday, New World Development (NWD) announced a significant markdown on its most recent residential project in Hong Kong. This move comes as the struggling developer is urgently trying to raise funds to reduce its overwhelming debt of HK$123.7 billion (US$15.9 billion).

Sun Hung Kai Properties set the initial rate for apartments in its Lime Gala project in August 2016, with an average cost of HK$17,732 per square foot.

The cost was approximately 13% less than its housing value, which was roughly HK$21,500, as noted by Alex Leung, a high-ranking director at CHFT Advisory and Appraisal. The housing value, which is the cost of land purchase divided by the total allowed floor area for the project – was around HK$6 billion and 279,600 square feet in this instance, he mentioned.

Furthermore, he mentioned that the building expenses could rack up to an extra HK$1.5 billion not including interest.

The company, listed in Hong Kong, is among the city's most heavily indebted developers, with a consolidated net debt of HK$123.7 billion as of June 2024, as stated in their yearly report. NWD has one of the city's highest net gearing or debt-to-equity ratios, standing at 55%. Additionally, it holds loans and bonds that accrue interest, totaling HK$151.6 billion.

Alibaba strengthens its consumer AI division by hiring specialist Steven Hoi in a bid to secure premier tech talent. Experienced AI investigator Steven Hoi has been appointed as a vice-president at Alibaba, becoming part of its Intelligent Information Platform team based in Singapore.

Hoi is set to spearhead the research and development of multimodal base models, investigations related to agents, and practical solutions for AI enterprises focused on consumers, as reported by the Chinese digital media platform, Jiemian.

The hiring of Hoi by Alibaba underscores the escalated hunt for premier AI professionals by major tech firms in China, both domestically and internationally, in response to difficulties in the nation's employment sector.

A majority of business owners in the Asia-Pacific region believe AI will boost their business growth, according to UBS. In fact, around 67% of participants worldwide expressed they would employ AI to enhance their productivity, while roughly 46% would use it to reduce staff numbers.

According to Vishakha Rajput, who leads the entrepreneurs division at UBS Global Wealth Management, participants in a survey identified AI as the most significant business opportunity. On a global scale, an average of 62% of the respondents indicated that they see AI as the technology providing the most potential.

Approximately 67% of participants worldwide indicated they would employ AI to enhance efficiency, and 46% would utilize it to decrease workforce numbers. However, in the Asia-Pacific area, these percentages increased to 75% and 66% respectively.

"AI is a prevalent subject among entrepreneurs in the APAC region presently, particularly due to its capacity to enhance business efficiency," stated Sundeep Gantori, a worldwide technology equity strategist at UBS Global Wealth Management CIO APAC.

Overall, half of the business owners in the Asia-Pacific area stated they would put money into AI systems and programs.

The majority of business owners in the Asia-Pacific region believe AI will boost growth, according to UBS. Worldwide, around 67% of those surveyed expressed plans to utilize AI to enhance productivity, and 46% intend to use it to reduce their workforce.

According to Vishakha Rajput, who leads the entrepreneurs division at UBS Global Wealth Management, survey participants indicated that they see AI as the biggest business prospect. On a global scale, around 62 percent of those questioned stated they would regard AI as the technology with the most potential.

Approximately two-thirds of participants worldwide indicated they would employ artificial intelligence to enhance efficiency, and nearly half would utilize it to decrease staffing levels. In the Asia-Pacific area, those percentages increased to 75 and 66 respectively.

"AI is currently a hot topic among entrepreneurs in the APAC region, particularly because of its capacity to greatly enhance business efficiency," stated Sundeep Gantori, a worldwide technology equity strategist at UBS Global Wealth Management CIO APAC.

Overall, half of the business owners in the Asia-Pacific area expressed their intent to invest in AI technology and software.

DeepSeek pauses account refills due to the popularity of AI models competing with ChatGPT

The Chinese start-up's recent AI models seem to be experiencing a demand surge that surpasses its server capability.

On Thursday, the firm deactivated the recharge function on its platform's website. The alteration was blamed on "limitations with server resources," but it was noted that "current balances remain usable."

The DeepSeek Platform provides users with the ability to interact with its APIs. These APIs act as a conduit, enabling developers and applications to connect with the AI models of the startup.

LLMs refer to artificial intelligence models that are developed to comprehend human language and execute functions, such as creating text or responding to queries. On the other hand, reasoning models are specifically crafted to carry out logical reasoning and inference-related tasks.

Following the launch of its eponymous chatbot on January 10, DeepSeek saw a rapid influx of daily active users (DAUs), exceeding 22 million by the month's end. This put it second only to ChatGPT, which boasted 53 million DAUs at that point, as per the data provided by market analyst Aicpb.com.