Last week, Dow Jones was up just fractionally while S&P 500 rose 1.4%, moving above the key 5,000 level. Nasdaq gained 2.3%, briefly exceeding the 16,000 level. OpenAI’s CEO Sam Altman has spoken with investors about raising trillions of dollars to fund an effort to expand the world’s manufacturing capacity to make semiconductors for artificial intelligence. The effort could require US$5 trillion to US$7 trillion and a sprawling partnership between OpenAI, chipmakers, power providers and governments. China’s leading chip manufacturer, Semiconductor Manufacturing International Corporation, is setting up production lines outside Shanghai to manufacture even more advanced chips as soon as this year. The news comes despite U.S. efforts to prevent China from advancing its chipmaking abilities through sanctions and blacklists. Nvidia is in talks with Microsoft, Meta, Amazon to develop custom AI chips. Arm shares soared as much as 41% after the chip designer gave a strong forecast. Palantir stock jumped 19% as AI demand drove a revenue beat. OpenAI is developing a form of agent software to automate complex tasks by effectively taking over a customer’s device. Google launched its GPT-4 rival, Gemini Ultra, for US$20 a month. Disney’s ESPN, Warner Bros. Discovery and Fox Corp. have announced a new streaming joint venture in the U.S. that would put all of their sports programming on a single app. In Canada, Sophic Client UGE achieved commercial operation for a rooftop community solar project in Queens, New York. UGE had the Queens project appraised by a third party for a fair market value of US$3.20/watt, with a project total of US$1.2 million. With the completion of this project, UGE’s operating portfolio now stands at 5.6MW, with an additional 17.7MW of projects currently in the construction and deployment phase of development.

Canadian Technology Capital Markets & Company News

Sophic Client UGE International (UGE-TSXV, UGEIF-OTC) achieves commercial operation for rooftop community solar project in Queens, New York.

UGE announces that it has reached commercial operation on its 376kW rooftop community solar project in Queens, New York. The project sits atop a 116,725 square foot modern warehouse located on Conduit Avenue near John F. Kennedy International Airport, that is owned and developed by New York City-based real estate developer Wildflower Ltd LLC. This will be UGE’s fifth solar project completed with Wildflower, with another three currently under development. As part of an ongoing partnership announced in November 2021, wireless provider T-Mobile will serve as the project’s anchor energy off-taker, supporting T-Mobile’s commitment to power its business using 100% renewable energy. UGE will reserve 50% of the project’s energy output for Low- to Moderate-Income subscribers, allowing these households and businesses to save upwards of 10% on their electricity costs. Subscriber acquisition and management for this and several other New York City-area project is handled by Ampion. UGE had the Queens project appraised by a third party for a fair market value of US$3.20/watt, with a project total of US$1.2 million. UGE will receive a grant through New York State Energy Research and Development Authority (NYSERDA)’s Clean Energy Communities program, which is designed to help incentivize, among other clean energy priorities, the development of community solar programs and specifically those which serve LMI communities. UGE’s grant is expected to total US$185,000. Each year the Queens project will offset more than 450 metric tons of CO2, the equivalent produced by burning over 50,000 gallons of gasoline. With the completion of this project, UGE’s operating portfolio now stands at 5.6MW, with an additional 17.7MW of projects currently in the construction and deployment phase of development. https://bit.ly/4bqRtz3

OpenHouse.ai raises $1.5 million for house-planning and marketing tool.

Calgary-based proptech startup OpenHouse.ai has raised $1.5 million for its AI-powered house planning and marketing platform for builders. The seed round was led by Trico Ventures and included participation from undisclosed home builders across the United States (US) and Canada, the company said. http://tinyurl.com/337h56xj

Wealthsimple surpasses combined $200 million for venture, private credit, equity funds.

Wealthsimple began rolling out its alternative offerings in April 2022 to give qualified retail investors access to asset classes typically available only to institutional investors and the ultra-wealthy. Those three investment funds have seen demand from retail investors: the Toronto-based FinTech startup told BetaKit that it has now raised over $200 million collectively across its funds, which span venture capital, private credit, and private equity. All of this funding has come from retail investors. While a Wealthsimple spokesperson declined to disclose how much each fund has raised individually, Wealthsimple chief investment officer Ben Reeves previously indicated that at least $130 million of that amount has gone into its private credit fund. Founded in 2014 as an investment platform, Wealthsimple has since added spending and savings accounts, cryptocurrency trading, tax filing, and peer-to-peer payments offerings. According to Wealthsimple, investors interested in its alternative investing options must have at least $100,000 in assets with Wealthsimple and meet its suitability screening. The company’s push for alternative retail investment options started in April 2022 with Wealthsimple’s Venture Fund I, which gives clients access to pre-initial public offering tech companies. In March 2023, Wealthsimple partnered with Sagard to give customers the ability to invest in “institutional-grade” private credit. Wealthsimple launched its private equity offering last November in the form of a fund managed by co-investor LGT Capital Partners, the Liechtenstein royal family’s wealth management group. Wealthsimple’s venture capital fund has closed, but its private credit and private equity funds are open-ended. http://tinyurl.com/594sr48t

Global Markets: IPOs, Venture Capital, M&A

OpenAI CEO Altman said to be in talks to raise trillions for AI chip, power initiative.

OpenAI CEO Sam Altman has spoken with investors about raising trillions of dollars to fund an effort to expand the world’s manufacturing capacity to make semiconductors for artificial intelligence, according to a report in The Wall Street Journal. The effort could require US$5 trillion to US$7 trillion and a sprawling partnership between OpenAI, chipmakers, power providers and governments. Altman has spoken to investors including the United Arab Emirates government and SoftBank CEO Masayoshi Son, as well as chip-making giant Taiwan Semiconductor Manufacturing Co. about the ambitious project, according to the report. His vision would be to raise money from Middle East investors and have TSMC build and run chip-fabrication plants, which could number in the dozens. He has also discussed the venture with U.S. Commerce Secretary Gina Raimondo, who has been closely involved in government efforts to promote U.S. chipmaking. A spokesperson for OpenAI didn’t immediately respond to a request for comment. Altman is trying to solve one of the key bottlenecks hindering OpenAI’s growth. For the past year, companies working on AI have complained about the lack of Nvidia graphics processing units. More recently people working in cloud computing have warned that power availability is an even bigger constraint. Altman has personally invested in startups that are trying to create energy using cutting edge technology such as nuclear fusion. http://tinyurl.com/5avf4j9a

Nvidia talks to Microsoft, Meta, Amazon about custom AI chips.

Nvidia dominates the market for server chips that companies use to develop and run artificial intelligence. Now Nvidia is talking to its top AI server chip customers about developing chips customized to their specific needs, according to a Reuters report, building on CEO Jensen Huang’s 2022 announcement about developing custom chips. The move could further deepen Nvidia’s relationships with those customers, including Amazon, Microsoft and Meta Platforms, and lessen their interest in pursuing alternatives to Nvidia. Nvidia is arguably late to the custom chip field. Major cloud providers including Amazon and Microsoft have developed their own custom AI server chips, which they hope will lower their dependence on Nvidia. However, designing and continuously improving a chip that rivals Nvidia’s won’t be easy, so it is possible these customers could still want to work with Nvidia on custom chips. A spokesperson for Nvidia declined to comment. http://tinyurl.com/3czzwuk2

SoftBank swings to profit on Vision Fund’s investment gains.

SoftBank Group reported its first quarterly profit in more than a year, as its Vision Fund unit recorded investment gains thanks to an increase in the value of its stakes in tech companies. In the quarter through December, SoftBank posted a net profit of 950 billion yen (US$6.4 billion). The Japanese firm’s Vision Fund unit, which holds a vast portfolio of public and private tech companies, reported US$4 billion in investment gains. Publicly traded stocks accounted for US$1.5 billion of those gains, while unlisted startups accounted for US$2.5 billion, the unit said. In a presentation on its earnings, SoftBank outlined its investment strategy and emphasized the importance of U.K. chip designer Arm as the centerpiece of its portfolio. Arm, which went public on Nasdaq last year, accounted for 32% of SoftBank’s total asset value as of the end of 2023. SoftBank’s portfolio has changed drastically from four years ago, when its stake in China’s Alibaba accounted for 50% of its total asset value, according to the presentation. Earlier this week, Arm’s stock rose on the company’s better-than-expected quarterly results. The quarterly profit came after a volatile year for SoftBank. For the previous quarter through September 2023, Vision Fund recorded a loss of about US$1.7 billion as it wrote down the value of its stake in WeWork, which filed for Chapter 11 bankruptcy protection in November. http://tinyurl.com/4jwjbeht

SoftBank-backed medical genetics company Invitae prepares for bankruptcy.

Invitae, a medical genetics company that received backing from SoftBank Group at the height of the pandemic has hired restructuring advisers and is preparing to file for bankruptcy within weeks, according to people familiar with the matter. The company is working with Moelis, FTI Consulting and law firm Kirkland & Ellis to explore strategic options, including bankruptcy, to address US$1.5 billion in debt on its balance sheet, the people said. Once a high-flying biotech stock that was promoted by Cathie Wood’s ARK Investment, Invitae’s market cap topped US$7 billion in 2020, when its shares reached over US$50. Since then, Invitae’s stock has tumbled to under US$1. On Monday the company’s shares traded down to 9 cents. Wood has called the company one of the most underappreciated stocks in her portfolio that is one of the most important companies in the genomic revolution. http://tinyurl.com/53k79hvz

Adam Neumann is trying to buy back WeWork.

In a letter published by The New York Times today, lawyers for Neumann, his latest startup Flow Global Holdings LLC, and “their affiliates” wrote that they were dismayed with “WeWork’s lack of engagement even to provide information” in response to efforts to be able to make an offer to buy the company. The letter disclosed that Neumann, Flow and affiliates were partnering with investors such as Dan Loeb’s hedge fund Third Point and “others.” Neumann’s attorneys further claimed that he had “previously worked to arrange up to US$1 billion of financing to stabilize WeWork in October 2022, when just before the meeting (while participants were literally in the air traveling), the former CEO shut down that process without explanation.” When asked about Neumann’s buyback attempt, WeWork told TechCrunch today: “WeWork is an extraordinary company. As such, we receive expressions of interest from external parties on a regular basis. We and our advisors always review those approaches with a view to acting in the best interests of the company. We continue to believe that the work we are currently doing — addressing our unsustainable rent expenses and restructuring our business — will ensure WeWork is best positioned as an independent, valuable, financially strong and sustainable company long into the future.” Meanwhile, Third Point told the Financial Times that it had held “only preliminary conversations with Flow [Neumann’s property company] and Adam Neumann about their ideas for WeWork, and has not made a commitment to participate in any transaction.” Notably, Neumann’s new venture Flow, a residential real estate outfit focused on rentals, is backed by the likes of venture firm Andreessen Horowitz (a16z). In August 2022, the investment firm wrote its largest individual check ever, at US$350 million, to Flow, so if Flow succeeds in its attempt to buy WeWork, a16z would presumably become a shareholder in the company. http://tinyurl.com/3hu5ncfc

Disney takes US$1.5 billion stake in ‘Fortnite’ maker Epic Games.

Disney is investing US$1.5 billion for an equity stake in “Fortnite” maker Epic Games—a move that CEO Bob Iger said is Disney’s “biggest entry ever” into the videogame industry, during his prepared remarks on the companies’ earnings call. According to Iger, the deal will bring Disney franchises and characters including those from Marvel, Star Wars, Pixar and Avatar into “Fortnite,” one of the most popular games in the world. Disney and Epic Games will partner to create new games and a Disney-branded “entertainment universe” within “Fortnite.” Players will be able to create their own games within this universe, create and share videos, and eventually also shop and purchase digital goods based on Disney franchises. The Epic investment is a major move for Iger, who has been trying to ward off multiple proxy battles from activist investors including billionaire Nelson Peltz. Disney shares jumped roughly 7% after markets closed. http://tinyurl.com/26f83cdr

Tech layoffs just keep coming as sector resets for AI.

Since cutting tens of thousands of workers in late 2022 and early last year, the tech industry has extended its belt-tightening after years of growth with little restraint. Companies have emerged from the tech downturn with a new focus on profitability. And the AI excitement that has been a boon to the tech industry is also leading companies to shift resources away from other efforts and, in some cases, increase automation in their own workforces. http://tinyurl.com/365dm34j

Snap to cut 10% of workforce.

Snap said it would lay off about 10% of its global workforce, the latest in a stream of tech companies cutting jobs. The messaging firm disclosed the job cuts via a securities filing on Monday morning, a day before it is due to report fourth quarter results. The company has forecast revenue growth of between 2% and 6%, following a 5% increase in the third quarter. Snap had an operating loss of US$359.5 million in the quarter. In today’s securities filings, the company said the cuts were designed “to ensure we have the capacity to invest incrementally to support our growth over time. http://tinyurl.com/3yn2stzx

Talks between software company DocuSign and private equity firms Bain Capital and Hellman & Friedman have stalled amid disagreements over price, Reuters reported Monday, citing three people familiar with the matter.

DocuSign Take-Private Talk With Bain, Hellman & Friedman Put On Ice. A buyout of DocuSign, which has a market value of about US$11 billion, would have been one of the largest leveraged buyouts in the past two years. It’s not clear whether deal talks will resume in the future or whether the two sides will walk away from a deal. Large take-privates have slowed down as interest rates have risen, resulting in higher costs of financing. Still, private equity firms are feeling pressure from limited partners to return money to investors and deploy new capital. http://tinyurl.com/b2xmbbdv

CVC agrees to buy RuneScape developer from Carlyle.

European private equity giant CVC and Texas-based buyout firm Haveli Investments struck a deal Friday to buy videogame developer Jagex from Carlyle Group. Terms of the deal weren’t disclosed, but U.K. outlet City A.M. reported it at around £910 million, or US$1.1 billion. A CVC spokesperson declined to comment. Jagex, the maker of popular online multiplayer role playing game RuneScape, was bought by Carlyle in 2021 and has since expanded to by acquiring rival developers Gamepires and Pipeworks Studio in 2022. Haveli Investments holds stakes in gaming companies including Omeda Studios and Behaviour Interactive. http://tinyurl.com/5uzddu7t

Synopsys kicks off sale of US$3 billion-plus SIG unit.

Synopsys Inc. is preparing to kick off the sale of its software integrity business, which could be valued at US$3 billion or more, people with knowledge of the matter said. The California-based chip designer is working with an adviser to gauge buyer interest in the division, known as SIG, according to the people. The unit is likely to attract private equity firms, they said. SIG helps software developers with application security testing and has been steadily built up over the years since Synopsys acquired Coverity in 2014. Synopsys announced it was reviewing strategic alternatives for SIG late last year. Synopsys in January agreed to buy software developer Ansys Inc. for about US$34 billion in cash and stock, marking one of the largest deals announced worldwide in the past year. The acquisition aims to expand Synopsys’s customer base and its suite of products. https://archive.is/UmvUB

Arm shares soar as much as 41% after chip designer gives strong forecast, says AI is boosting sales.

Arm reported fiscal third-quarter earnings Wednesday that beat estimates and gave a strong profit forecast for the current quarter. The shares soared as much as 41% in extended trading. Arm, which had been owned by SoftBank, went public in September. The company was founded in 1990 to develop technology for low-power chips, but became more important to the overall technology industry when the Apple iPhone and competing Android devices standardized on Arm-based chips. Arm says companies including Apple, Google, Microsoft and Nvidia use its technology. http://tinyurl.com/muuyvvx2

Palantir stock jumps 19% as AI demand drives revenue beat.

Palantir shares surged more than 19% in after-hours trading on Monday after the company reported fourth-quarter earnings that beat analysts’ expectations for revenue. Full-year guidance for 2024 came roughly in line with Wall Street’s estimates. In a letter to shareholders, Palantir CEO Alex Karp said the company’s expansion and growth “have never been greater,” especially as demand for large language models in the U.S. “continues to be unrelenting.” Palantir has been rolling out its Artificial Intelligence Platform, or AIP, and Karp said the company carried out nearly 600 pilots with the technology in 2023, up from fewer than 100 in 2022. “Our results reflect both the strength of our software and the surging demand that we are seeing across industries and sectors for artificial intelligence platforms,” Karp wrote. Palantir, known for its defense and intelligence work with the U.S. government, said its U.S. commercial revenue grew 70% year over year. Palantir said its U.S. commercial customer count increased 55% from 143 customers to 221 customers. http://tinyurl.com/5xyxt6jw

Snap plunges 30% on revenue miss and light guidance, as company says Middle East war creates ‘headwind’.

Snap said fourth-quarter revenue rose about 5%, while the company’s net loss narrowed 14% from a year earlier. The company’s top-line numbers missed estimates, and Snap issued a disappointing forecast. Snap told investors in a letter Tuesday that the Middle East conflict led to a “headwind” in growth. http://tinyurl.com/5e437juz

PayPal issues disappointing guidance even as fourth-quarter earnings top estimates.

PayPal reported better-than-expected fourth-quarter results Wednesday, but issued guidance that was a bit below estimates. The shares slid 8% in extended trading. PayPal provided guidance for the full year and first quarter that fell just short of expectations. The company anticipates full-year earnings of US$5.10 per share, below the US$5.48 analysts expected, according to LSEG. Finance Chief Jamie Miller said on the earnings call that the company will stop providing annual guidance, and instead just provide an outlook for the current quarter. http://tinyurl.com/4dh4k27c

Alibaba shares drop 5% after revenue miss, US$25 billion boost to buyback plan.

Shares of Alibaba fell Wednesday, as the company missed market expectations for revenue in the December quarter, even as it announced it is increasing the size of its share buyback program by US$25 billion. U.S.-listed shares in the Chinese e-commerce giant were are one point more than 5% higher in premarket trade, but reversed course and closed down more than 5%. Alibaba said the US$25 billion increase is added to its share repurchase program through the end of March 2027, bringing the total available under the plan to US$35.3 billion. The company said in a statement that the increased buyback shows the “confidence in the outlook of our business and cash flow.” The announcement comes after a tumultuous year for Alibaba in 2023, when the company carried out its largest-ever corporate structure overhaul. It also separately impemented several high-profile management changes, with company veteran Eddie Wu taking over the reins as chief executive in September. http://tinyurl.com/yc3b6smb

Yandex owner to exit Russia in US$5.2 billion deal. Yandex NV has struck a 475-billion-rouble (US$5.21 billion) deal to sell what has been dubbed “Russia’s Google” to a group of Russian investors, marking the biggest corporate exit from the country since Moscow invaded Ukraine almost two years ago. The Kremlin-engineered deal would see Russia’s largest technology player fall entirely under Russian ownership, including a fund ultimately owned by oil major Lukoil, opens new tab, and cement Yandex’s departure from Western tech circles. Once seen as one of the few Russian companies with the potential to become a global business, Nasdaq-listed Yandex , opens new tab had developed leading online services, including search, advertising and ride-hailing in Russia. http://tinyurl.com/2vrpjt7s

Emerging Technologies

Google launches its GPT-4 rival, Gemini Ultra, for US$20 a month.

Google on Thursday launched its flagship conversational artificial intelligence model, Gemini Ultra, but will only make it available to consumers through a US$20-a-month chatbot subscription—the same price OpenAI charges for the most powerful version of ChatGPT. Google claims Gemini Ultra’s performance beats GPT-4, the model powering the paid version of ChatGPT, on a number of benchmarks, but Google’s challenge will be to convince professionals to sign up for the new product. The launch of Gemini Ultra puts Google in a dead heat with OpenAI in terms of AI capabilities. Google had been playing catch-up since OpenAI launched ChatGPT in late 2022. Google is including the subscription to its Gemini Ultra-powered chatbot, Gemini Advanced (previously known as Bard), with an existing Google One bundle of cloud storage and other extra features tied to the company’s Google Photos app. (Last week, Google CEO Sundar Pichai said Google One was nearing 100 million subscribers.) It will also give subscribers access to Gemini-powered AI features when using Google’s productivity software, including Docs and Slides, to help them analyze data or generate charts or email drafts. Google will sell access to Gemini Ultra to app developers through Google Cloud in the coming weeks, the company said, in hopes of making up ground with Microsoft, which sells access to GPT-4 and other OpenAI models through its cloud service. Google also created a standalone app for Gemini on Android devices, which will replace the voice-activated Google Assistant for users who opt in. http://tinyurl.com/4yx9nb52

OpenAI Shifts AI battleground to software that operates devices, automates tasks.

OpenAI is developing a form of agent software to automate complex tasks by effectively taking over a customer’s device. The customer could then ask the ChatGPT agent to transfer data from a document to a spreadsheet for analysis, for instance, or to automatically fill out expense reports and enter them in accounting software. Those kinds of requests would trigger the agent to perform the clicks, cursor movements, text typing and other actions humans take as they work with different apps, according to a person with knowledge of the effort. he software in the works is one of two types of agents OpenAI is developing as it jumps into one of the hottest areas of artificial intelligence, which could soon include Google and Meta Platforms. Some longtime AI researchers have been leaving companies such as Google to start companies that develop agents. OpenAI will have to temper fears about agents that access users’ computers, given that such a takeover may remind some people of malware, which is known to illicitly seize control of computers and steal their data. It isn’t clear when OpenAI plans to release its agent products, which have been in development for more than a year, but some of its employees have hinted at their importance. http://tinyurl.com/m7hcz4vh

WhatsApp is working on secure cross-app messaging to connect users across platforms.

WhatsApp is embarking on an initiative that will allow its vast user base of 2 billion to send messages across different messaging applications, according to a recent WIRED report. This effort, which has been in the works for around two years already, aims to facilitate seamless cross-app messaging while upholding WhatsApp’s commitment to end-to-end encryption. This marks a significant departure from WhatsApp’s previous stance, potentially enhancing competition among messaging apps. This move toward interoperability is partly driven by regulatory pressures from the European Union. In September, the EU’s Digital Markets Act identified Meta, WhatsApp’s parent company, as a key digital “gatekeeper,” mandating it to enable cross-platform messaging. As the deadline approaches, WhatsApp is revealing its plans for how this cross-app messaging could function, striving to maintain its high standards of privacy and security. http://tinyurl.com/as4f9hx4

Media, Streaming, Gaming & Sports Betting

ESPN, Fox and Warner Bros. Discovery form new sports streaming joint venture.

Disney’s ESPN, Warner Bros. Discovery and Fox Corp. have announced a new streaming joint venture in the U.S. that would put all of their sports programming on a single app. This standalone video service will include access to the sports TV channels owned by each company, including ESPN, TNT and FS1 as well as ESPN+, a subscription service that offers access to sports and games beyond those that ESPN airs on traditional TV. The joint venture and app, which is scheduled to launch in the fall of 2024, will be equally owned by ESPN, Fox and WBD and run by an independent management team, the companies said. It’s still to be determined what the service will cost subscribers, but the companies won’t share revenue equally, said another person with knowledge of the matter. Instead, revenue from the service will be determined by how much ESPN, Fox and Warner Bros. charge cable TV companies to carry their TV channels. In other words: this means ESPN, which has the most expensive affiliate fees in cable TV, will make more money per subscription to the joint service than Fox and Warner Bros. The new venture will arrive as live sports rights continue to skyrocket. The NBA, for instance, wants to triple the revenue it currently receives from broadcasters, which could amount to as much as US$7 billion to US$8 billion annually from TV networks and streamers, as The Information has previously reported. Increases in other recent and upcoming sports rights deals including the NFL, NASCAR and college football is making it harder for traditional TV companies to afford the costs from cable TV revenue, which continue to decline. In this context, a sports bundle consisting of ESPN, Fox Sports and Warner Bros. Discovery’s Max could be appealing to hardcore sports fans as it would offer access to a wide selection of games from major sports leagues including the NFL, NBA, NHL and college football. This new joint venture won’t affect Disney’s plans to launch a full-streaming version of ESPN in the coming years, said a person with knowledge of the matter. That app will also include all live and on-demand sports content from ESPN, but not programming from WBD or Fox, which could limit the number of potential subscribers for that service. However, ESPN is focused on providing sports fans with as many options as possible to access its content, whether it’s through a traditional cable pay-TV provider, this upcoming joint streaming venture, or ESPN’s future all-streaming app, the person said. http://tinyurl.com/msdzaavw

YouTube TV passes 8 million subscribers.

YouTube TV, the video giant’s cable TV-like subscription streaming service, has surpassed 8 million subscribers, according to a new blog post from YouTube CEO Neal Mohan. That makes it the biggest internet-based live TV streaming service in the U.S., ahead of Disney’s Hulu + Live TV, which had 4.6 million subscribers at the end of September 2023. Meanwhile, Comcast, the largest pay-TV provider in the U.S., ended 2023 with 14.1 million customers after losing 2 million customers over the course of the year. YouTube has been making significant inroads into the TV industry as more of its users watch videos through the platform’s app on their TV screens. As of last spring, nearly 45% of YouTube viewing in the U.S. was happening on TV screens, as The Information previously reported. Mohan indicated that the TV screen and subscription revenue will be big priorities for YouTube going forward. Last week, during Alphabet’s earnings, the company’s chief executive Sundar Pichai said its suite of subscription services, which include YouTube TV, YouTube Premium, YouTube Music and Google cloud storage, generated US$15 billion in revenue last year—up five-fold since 2019. “YouTube is the key driver of our subscription revenues,” Pichai said on the call. http://tinyurl.com/bdhu7ap8

Meta to label AI-generated images.

Meta Platforms in coming months will label images on Facebook, Instagram and Threads that it believes were generated using artificial intelligence, said Nick Clegg, president of global affairs, in a blog post on Tuesday. The labels will apply to images made using tools from Google, Microsoft, Adobe, OpenAI, Midjourney and Shutterstock as those companies add invisible markers to AI-generated images. Google in August launched a tool where users can choose to watermark and identify AI-generated images. Adobe in October announced a symbol—later adopted by Microsoft—that users can add to an image to establish its source. Meta labels images made using its own image generation tools with “Imagined with AI.” The company also embeds metadata and invisible watermarks into those images. “As the difference between human and synthetic content gets blurred, people want to know where the boundary lies,” Clegg wrote. “People are often coming across AI-generated content for the first time and our users have told us they appreciate transparency around this new technology.” http://tinyurl.com/mrx8557e

Spotify crosses the 600 million monthly active users mark.

Streaming service Spotify announced that the service now has more than 600 million monthly active users. The company said in its Q4 2023 earnings report that it added 28 million users in the quarter, which marks the second biggest quarterly gain in the company’s history. The Sweden-based company noted that apart from having 602 million users now, the service has over 236 million paid users — a year-on-year growth of 15%. Last year, Spotify raised the prices of its premium subscription tier in the U.S. for the first time from US$9.99 per month to US$10.99 per month. http://tinyurl.com/mv7d65yv


China plans to make 5 nanometer chips in defiance of U.S. sanctions.

China’s leading chip manufacturer, Semiconductor Manufacturing International Corporation, is setting up production lines outside Shanghai to manufacture even more advanced chips as soon as this year, the Financial Times reported. The news comes despite U.S. efforts to prevent China from advancing its chipmaking abilities through sanctions and blacklists. The SMIC factory wll make 5-nanometer chips designed by Huawei using older U.S.- and Dutch-made equipment. These chips would be a generational leap over the 7 nanometer China-made chips that appeared last year in a high-end Huawei smartphone, surprising U.S. government officials and tech analysts. http://tinyurl.com/2zcyyhwa


Hertz halts plan to buy 65,000 electric cars amid EV slump.

Hertz is scaling back its EV ambitions. The rental car giant is pausing plans to buy 65,000 electric cars from EV pioneer Polestar, according to comments made by Polestar CEO Thomas Ingenlath in an interview with The Financial Times. This comes just weeks after Hertz said it would sell off 20,000 EVs — one-third of its electric vehicle fleet – citing high repair costs as a key reason for this. Hertz’s estimated US$3 billion agreement with up-and-coming EV maker Polestar in 2022 was seen as a major moment for electric vehicle adoption. It came after Hertz struck a similar deal with Tesla and agreed to buy 100,000 of its EVs in 2021. That deal has also had its issues, with Elon Musk’s barrage of price cuts driving down the value of Hertz’s fleet of used Teslas. http://tinyurl.com/ar5wf69p


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There is no express or implied solicitation to buy or sell securities. Sophic and/or its principals and employees may have positions in the stocks mentioned in the Company’s Material and may trade in the stocks mentioned in the Material. Do not consider buying or selling any stock without conducting your own due diligence and/or without obtaining independent investment advice from a qualified and registered investment advisor. The Company has not independently verified any of the data from third party sources referred to in the Material, including information provided by Sophic clients that are the subject of the report, or ascertained the underlying assumptions relied upon by such sources. The Company does not assume any responsibility for the accuracy or completeness of this information or for any failure by any such other persons to disclose events which may have occurred or may affect the significance or accuracy of any such information. 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Forward-looking statements are based on opinions and assumptions as of the date made, and are subject to a variety of risks and other factors that could cause actual events/results to differ materially from these forward looking statements. There can be no assurance that such expectations will prove to be correct; these statements are no guarantee of future performance and involve known and unknown risks, uncertainties and other factors. Sophic provides no assurance as to future results, performance, or achievements and no representations are made that actual results achieved will be as indicated in the forward looking information. Nothing herein can be assumed or predicted, and you are strongly encouraged to learn more and seek independent advice before relying on any information presented.