July 09, 2023: Holiday Shortened Week Pullback, NASDAQ Composite Holding 10-day Line, So Far.

Last week, Dow Jones fell 2%, S&P 500 lost 1.2%, and Nasdaq composite gave up 0.9%, but held its 10-day moving average. Bitcoin has staged a comeback, rallying 25% since BlackRock filed for its crypto fund. Banks holding debt from Elon Musk’s Twitter buyout might consider selling it as soon as Labor Day, the Wall Street Journal reported. Tesla deliveries rose 83% in the second quarter, in a sign that customers are galvanized by the electric vehicle maker’s frequent price cuts and new government subsidies. Rivian delivered 12,640 electric vehicles in the second quarter, a nearly three-fold increase from the same period last year when the EV upstart was in the thick of supply chain problems. Apple has been forced to make drastic cuts to production forecasts for the mixed-reality Vision Pro headset, unveiled last month after seven years in development (~130-150K in the first year vs. an initial sales target of a million units). ChatGPT app downloads are slowing down, BofA finds. Bluesky reaches 1 million downloads as Threads topples 70 million. China will control exports of some metals widely used in the semiconductor industry, its commerce ministry announced on Monday, the latest salvo in an escalating war over access to high-tech microchips between Beijing and the United States. In Canada, we saw positive funding announcements from Char Technologies, Prostar Holdings, MiMedia, Geologic AI, and a $30 million acquisition from Tiny.

Sophic Capital Client UGE International (UGE-TSXV, UGEIF-OTC) achieves notice to proceed milestone for 548-kilowatt rooftop community solar project on Staten Island.

UGE has reached the ‘Notice to Proceed’ (NTP) milestone for a 548-kilowatt rooftop solar project on Staten Island, New York. The Notice to Proceed milestone indicates that financing for the project has closed and all necessary permits and interconnection approvals for the project are in place. Strengthening renewable energy equity is one of UGE’s guiding goals; the Company’s stated target is for more than 25% of the off-take from its operational portfolio to serve LMI households by 2026. With this project, UGE has reached NTP on 13.2MW of projects and commercial operation on 1.4MW of projects so far this year. Construction on the Expressway Plaza project is set to begin this spring. Once operational, the project is estimated to produce an average of US$89,000 in annual revenue, with a total project life of at least 22 years. The Company currently expects average recurring revenue to carry gross margins at or around 85%. In addition, UGE will receive a grant through New York State Energy Research and Development Authority (NYSERDA)’s Clean Energy Communities program. UGE’s grant is expected to total approximately US$750,000. https://bit.ly/3CZwGTp

Tiny (TINY-TSXV) acquires HappyFunCorp, the prolific firm that’s built apps for Twitter, Amazon and more, for $30 million.

HappyFunCorp – a product engineering house that designs and builds apps and more for the likes of Apple, Disney, Amazon and Twitter – is getting acquired by Canadian firm Tiny for $30 million. Tiny is based out of Canada and is publicly traded there with a current market cap of around $500 million. HappyFunCorp is being acquired with a mix of shares and cash and will continue to operate independently out of Brooklyn, New York. https://bit.ly/44ti8Hk

Leading steel company ArcelorMittal SA invests $6.6 million in Char Technologies’ (YES-TSXV) decarbonization tech.

Char Technologies has received a $6.6 million strategic investment by one of the world’s leading steel and mining companies, ArcelorMittal SA, and its XCarb Innovation Fund. The cleantech company also signed a memorandum of understanding (MOU) that will see ArcelorMittal SA purchase biocarbon produced at Char’s Thorold, Ontario facility. Char also won ArcelorMittal’s inaugural XCarb Accelerator Programme. The XCarb Innovation Fund’s global mandate is to invest in companies developing breakthrough technologies that will accelerate the steel industry’s transition to carbon-neutral steelmaking. ArcelorMittal’s investment in Char marks the fund’s seventh global investment and first ever in a Canadian company. The investment followed testing by ArcelorMittal SA of Char’s proprietary technology that transforms wood waste into renewable natural gas and biocarbon. ArcelorMittal’s Canadian flat steel operation in Hamilton, ArcelorMittal Dofasco, has been collaborating with Char to test the use of its biocarbon as a partial replacement for fossil coal in its steelmaking processes. According to the company, Char’s biocarbon enables an approximately 91 percent reduction in greenhouse gas emissions compared to metallurgical coal. ArcelorMittal claims a presence in 60 countries with primary steelmaking facilities in 16 countries. The company says it generated revenues of $106.5 billion (US$79.8 billion) in 2022. https://bit.ly/3O1sDfy

ProStar Holdings (MAPS-TSXV) announces non-brokered private placement.

The Company announced a non-brokered private placement for gross proceeds of up to C$2,500,000 (the “Offering”). The Offering will consist of up to 8,333,333 units of the Company (each, a “Unit”, and collectively the “Units”) at a price of C$0.30 per Unit (the “Offering Price”). Each Unit consists of one common share of the Company (each, a “Common Share”, and collectively the “Common Shares”) and one-half of one Common Share purchase warrant (each whole warrant, a “Warrant” and collectively the “Warrants”). Each whole Warrant will entitle the holder thereof to acquire one common share of the Company at a price of C$0.45 per Common Share for a period of 24 months from the closing date of the Offering, provided that if the closing price of the Common Shares on any Canadian stock exchange on which the Common Shares are then listed is at a price equal to or greater than Cdn$0.75 for a period of 10 consecutive trading days, the Company will have the right to accelerate the expiry date of the Warrants by issuing a press release or other form of notice permitted by the certificate representing the Warrants, announcing that the Warrants will expire at 4:30 p.m. (Vancouver time) on a date that is not less than 30 days from the date notice is given. https://tinyurl.com/3r88kz6y

MiMedia (MIM-TSXV) announces c$2,500,000 brokered private placement of convertible debenture units.

MiMedia Holdings Inc. announced it has entered into an agreement with Canaccord Genuity Corp. (the “Agent”), pursuant to which the Agent has agreed to assist the Company in selling, on a commercially reasonable efforts private placement basis, up to 2,500 convertible debenture units of the Company (the “Debenture Units”) at a price of C$1,000 per Debenture Unit, to raise aggregate gross proceeds of up to C$2,500,000 (the “Offering”). The Debenture Units will be issued on the same terms and conditions as the convertible debenture units previously issued by the Company on March 14, 2023, pursuant to which the Company raised aggregate gross proceeds of $3,400,000. For further details concerning the prior issuance of convertible debenture units, see press release of the Company dated March 14, 2023. https://tinyurl.com/2r2wz2s2

GeologicAI closes $20 million Series A to develop AI-powered robot geologists.

Calgary-based mining tech startup GeologicAI has secured $20 million in Series A funding from Bill Gates’s Breakthrough Energy Ventures (BEV) to help meet the rising demand for critical minerals. Using proprietary core sample scanning hardware, advanced machine vision, and artificial intelligence (AI), GeologicAI aims to help mining and exploration firms search beneath the ground and gather data more efficiently than traditional core logging methods. https://bit.ly/3JKAJXw

Shakudo closes $9.5 million Series A to help companies adopt generative AI.

Toronto-based Shakudo has secured $9.5 million (US$7.2 million) in Series A funding to help companies launch artificial intelligence (AI) products more quickly and cost-effectively. Shakudo’s all-equity Series A round, which closed in April, was led by San Francisco-based GreatPoint Ventures with support from fellow new investor, England’s RTP Global. Toronto-based Golden Ventures and California’s Parade Ventures, which co-led Shakudo’s $4.2 million seed round in 2021, also participated in the firm’s most recent round, which brings Shakudo’s total funding to about $14.5 million. https://bit.ly/3O3coPa

FanDuel partners Canadian Football League.

Flutter Entertainment’s FanDuel brand has been unveiled as the Canadian Football League’s (CFL) first authorized gaming operator and an official sportsbook partner. The agreement will enable FanDuel players in Ontario to place wagers on the CFL through in-game player propositions and futures bets. FanDuel will offer fans markets on a variety of in-game player props, such as anytime touchdown scorer, passing, rushing and receiving yardage. Fans will also be able to wager on various futures bets, including which team will be crowned the 110th Grey Cup champion in Hamilton on Sunday 19 November. https://tinyurl.com/59rr8b95

Twitter banks may soon consider selling debt, report says.

Banks holding debt from Elon Musk’s Twitter buyout might consider selling it as soon as Labor Day, the Wall Street Journal reported, a move that would allow investors to take positions in Twitter’s bonds. Selling the debt would also likely crystallize the banks’ losses on the loans, which they made last October when the deal closed. The Journal report said banks would consider selling the debt if Twitter’s financial performance improves. A mass defection of advertisers in the wake of Musk’s takeover, which coincided with a downturn in the digital ad market, severely hurt Twitter’s business although Musk has slashed costs by laying off most of the company’s staff. The report also said several big investors said they wouldn’t want to invest in Twitter’s debt until next year at the earliest. The Journal report said banks have unloaded tens of billions in leveraged-buyout loans related to other deals, including the purchase of Citrix Systems and of Nielsen Holdings. In that sense, the fact that banks are still holding onto the Twitter buyout debt makes it an outlier. https://tinyurl.com/4s4v5j5x

Tesla deliveries spike 83% in second quarter.

Tesla deliveries rose 83% in the second quarter, in a sign that customers are galvanized by the electric vehicle maker’s frequent price cuts and new government subsidies. The company delivered 466,140 vehicles globally, up from 254,695 vehicles the same time last year and 440,808 in the first quarter of 2023, the company said on Sunday. Tesla’s production also rose to 479,700 cars, up 9% from the previous quarter, and nearly 86% from the year before. Tesla’s increasingly frequent price cuts led to shrinking margins in the first quarter, sounding the alarm for investors. The company is set to report second quarter earnings on July 19. https://tinyurl.com/cfpx7s5m

Ant to buy back shares at 70% lower valuation than at IPO.

Jack Ma-backed Ant Group Co. is proposing to buy back as much as 7.6% of shares in an effort to retain talent and provide a chance to cut stakes for investors ensnared by a years-long regulatory crackdown at the company. Each investor would be allowed to sell up to 7.6% of their equity rather than cashing out completely, according to a person familiar with the matter, asking not be identified discussing private details of the arrangement. https://tinyurl.com/4whky4wy

Rivian shares pop on better-than-expected Q2 deliveries.

Rivian delivered 12,640 electric vehicles in the second quarter, a nearly three-fold increase from the same period last year when the EV upstart was in the thick of supply chain problems. Rivian also reported that it produced 13,992 vehicles in the second quarter. Both results were far better than Wall Street’s expectations, sending shares flying up more than 16%. Shares are now up more than 12% at US$18.70. Rivian said it believes it is on track to deliver on the 50,000 annual production guidance previously provided. Rivian has produced 9,395 vehicles in the first quarter, bringing its total production through the first half of the year to 23,387 vehicles. Rivian produces four vehicles: its two consumer vehicles, the R1T truck and R1S SUV, and two versions of its commercial van. The company struggled with production problems early on, which was compounded by persistent supply chain issues. Those bottlenecks have started to open up as supply chain issues have eased. Rivian has also worked on the efficiency within its Normal, Illinois factory and developed its own drive unit called the Enduro to reduce costs and lessen its dependency on suppliers. https://bit.ly/3XKvhth

Worldwide public cloud services revenues surpass US$500 billion in 2022, growing 22.9% year over year, according to IDC Tracker.

Worldwide revenue for the public cloud services market totaled US$545.8 billion in 2022, an increase of 22.9% over 2021. Software as a Service – Applications (SaaS – Applications) continued to be the largest source of public cloud services revenue, accounting for more than 45% of the total in 2022. Infrastructure as a Service (IaaS) was the second largest revenue category with 21.2% of the total while Platform as a Service (PaaS) and Software as a Service – System Infrastructure Software (SaaS – SIS) delivered 17.0% and 16.7% of overall revenue respectively. Spending with the leading providers of public cloud services further consolidated in 2022 with the combined revenue of the top 5 public cloud service providers – Microsoft, Amazon Web Services, Salesforce Inc., Google, and Oracle – capturing more than 41% of the worldwide total and growing 27.3% year over year. With offerings in all four deployment categories, Microsoft remained in the top position in the overall public cloud services market with 16.8% share in 2022, followed by Amazon Web Services with 13.5% share. https://bit.ly/43ly11f

Apple forced to make major cuts to Vision Pro headset production plans.

Apple has been forced to make drastic cuts to production forecasts for the mixed-reality Vision Pro headset, unveiled last month after seven years in development and hailed as its most significant product launch since the iPhone. The complexity of the headset design and difficulties in production are behind the scaling back of targets, while plans for a more affordable version of the device have had to be pushed back, according to multiple people with direct knowledge of the manufacturing process. Apple has already flagged that the US$3,500 “spatial computing” headset device will not go on sale until “early next year”, a lengthy gap from its June 5 launch. Analysts have interpreted this as being more to do with supply chain problems than allowing developers time to create apps for the Vision Pro. Two people close to Apple and Luxshare, the Chinese contract manufacturer that will initially assemble the device, said it was preparing to make fewer than 400,000 units in 2024. Multiple industry sources said Luxshare was currently Apple’s only assembler of the device. Separately, two China-based sole suppliers of certain components for the Vision Pro said Apple was only asking them for enough for 130,000 to 150,000 units in the first year. Both projections imply a significant cut to production from an earlier, internal sales target of 1mn units in the first 12 months. The forecasts for low volumes reflect Apple’s lack of confidence in being able to scale production, according to analysts and industry experts, following years of missed deadlines in launching the device. Wall Street analysts’ forecasts for sales of the Vision Pro vary widely, from the low hundreds of thousands to several million in its first year. Analysts expect the Vision Pro will pass a user base of 20mn in five years after next year’s launch. https://archive.li/Zwfbk

Apple will require appointments to test Vision Pro headset.

Apple plans to limit in-store demonstrations of its Vision Pro headset to people who make appointments online. That decision, reported by Bloomberg, is another sign that Apple isn’t anticipating that the headset will be a mass-market product anytime soon. Apple has already repeatedly trimmed the number of Vision Pro headsets it plans to make: Earlier this month, the Financial Times reported that it plans to make only 400,000 of them in 2024 due to the complexity of the product, about half its previous goal. Apple’s US$3,499 price tag on the product is another factor likely to limit its appeal. Bloomberg said that Apple will initially offer the special areas for Vision Pro demos in Apple Stores in high-profile locations such as New York and Los Angeles before putting them in stores nationwide. Apple also initially required appointments from customers who wanted to test Apple Watches, though it eventually dropped that requirement. https://tinyurl.com/5zwnhmnk

ChatGPT app downloads are slowing down, BofA finds.

AI may be the hottest thing in the technology industry, but OpenAI’s ChatGPT is not on pace to challenge Google’s grip as the search engine leader, according to new analysis from Bank of America Securities. Analysts found that app downloads for ChatGPT and Microsoft Bing have slowed in recent weeks, citing Sensor Tower data, BofA analyst Justin Post wrote in a note Wednesday. ChatGPT downloads on iPhones in the U.S. were down 38% month over month in June, according to the note. Bing app downloads, which includes a ChatGPT-based chatbot in the U.S., were also down 38% in June. Google’s search engine market share is slightly up year over year at over 92%, according to the note, citing SimilarWeb data. Microsoft’s Bing, which uses OpenAI’s ChatGPT technology, was down 40 basis points on an annual basis to about 2.8% of the market. https://cnb.cx/46Bykb8

Bluesky reaches 1 million downloads as Threads topples 70 million.

Bluesky, a decentralized social network in competition with Twitter, has reached 1 million downloads, according to Data.ai, an analytics provider formerly known as App Annie. Bluesky, which launched in April, announced US$8 million in funding earlier this week. Meanwhile, Threads, the Meta-owned Twitter competitor that opened to the public on Wednesday, reached 70 million users on Friday, a record-breaking achievement, according to The New York Times. In a Threads post, Meta CEO Mark Zuckerberg said the app’s fast growth was “way beyond” the company’s expectations. That means that Bluesky—which has fewer than a dozen employees, The Information earlier reported—has its work cut out for it. The company’s recent venture capital infusion, led by San Francisco-based seed firm Neo, should help it onboard far more users and at a much quicker pace. https://tinyurl.com/4m75b3t9

Twitter is threatening to sue Meta over Threads.

Twitter is threatening legal action against Meta over its new text-based “Twitter killer” platform, accusing the social media giant of poaching former employees to create a “copycat” application. https://bit.ly/44xlXLn

Netflix to revamp advertising strategy to lure brands and boost revenues.

Netflix will develop increasingly targeted and tailor-made advertising formats to win over marketing bosses as it seeks to boost revenues in its recently launched advertising supported service. The US streaming service held talks with global advertising executives about new plans at this year’s Cannes Lions festival in the south of France after launching the ad-supported service last year. https://on.ft.com/3PISQk4

Court blocks Biden administration from pressuring social media firms over Covid ‘disinformation’.

A judge on Tuesday granted a preliminary injunction preventing the Biden administration from pressuring social media companies to take down posts questioning the effectiveness of Covid vaccines, face masks, lockdowns, the accuracy of the Hunter Biden laptop story and the validity of the 2020 election. The judge said that during the Covid pandemic, the administration “seems to have assumed a role similar to an Orwellian ‘Ministry of Truth.’” In the ruling, the judge laid out numerous examples where government officials had pressured Twitter and Facebook to remove posts on a variety of subjects. While many related to the effectiveness of Covid vaccines or face masks—which the administration called “disinformation,” others were more political. For instance, the ruling said that a White House official asked Twitter to “immediately” remove a parody account linked to President Biden’s granddaughter. Twitter suspended the parody account within 45 minutes of getting the request, the ruling said. https://tinyurl.com/54x4hvpm

Biden aims to restrict Chinese companies’ access to U.S. cloud computing services.

The Biden administration is preparing to restrict Chinese companies’ access to U.S. cloud computing services, The Wall Street Journal reported. Such a move would reflect Washington’s growing concerns about American technology benefiting China in the two nations’ race for supremacy. If the new rule comes into effect, it could require American cloud service providers such as Amazon and Microsoft to seek U.S. government permission before they provide Chinese customers with services that use advanced artificial intelligence chips, the Journal reported. The latest move comes as the Biden administration has been stepping up its efforts to curb exports of critical technology to China due to national security concerns. Last week, The Wall Street Journal reported that the administration is considering new restrictions on exports of AI chips to China in a move that could stop the shipments of such chips made by Nvidia and others to their Chinese customers. https://tinyurl.com/mtvas27j

Bitcoin stages a comeback, rallying 25% since BlackRock filed for its crypto fund.

Bitcoin has staged on an impressive rally over the past three weeks to cement its status as one of the biggest success stories of the year in markets. Its price has jumped 25% to over US$30,000 from the lows reached on June 15 – the date that the world’s largest asset manager BlackRock filed an application with the Securities and Exchange Commission to launch an exchange-traded fund tracking the cryptocurrency. The token is now up almost 90% year-to-date, meaning it’s outperforming the benchmark S&P 500 share index, as well as soaring Big Tech stocks including Apple, Amazon, Microsoft, and Google parent Alphabet. That rally has erased some of bitcoin’s losses from 2022, when its price cratered in the face of rising interest rates and the collapse of high-profile exchanges like FTX – although it still trades more than 50% below its all-time price of just under US$69,000, reached in November 2021. Around a third of its gains year-to-date have come since BlackRock filed with the SEC last month, which sparked a flurry of spot ETF applications from rival asset managers including Fidelity, Invesco, and WisdomTree. Nasdaq has subsequently refiled BlackRock’s application, saying that major exchange Coinbase will provide market surveillance for the fund, after the regulator reportedly had initial concerns about some paperwork being unclear and incomplete. BlackRock CEO Larry Fink said Wednesday in an interview with Fox Business that he believes the asset manager’s ETF will “democratize crypto” and make it cheaper for people to trade bitcoin. https://bit.ly/3XGIGCE

China to restrict exports of chipmaking materials as US mulls new curbs.

China will control exports of some metals widely used in the semiconductor industry, its commerce ministry announced on Monday, the latest salvo in an escalating war over access to high-tech microchips between Beijing and the United States. The controls, which China said were aimed at protecting national security and interests, will require exporters to seek permission to ship some gallium and germanium products. The move to manage exports of the rare elements that Beijing classifies as strategic, comes as Washington mulls new restrictions on the shipment of high-tech microchips to China, according to media reports. The United States and the Netherlands are also set to deliver a one-two punch to China’s chipmakers this summer by further restricting sales of chipmaking equipment, part of efforts to prevent their technology from being used to strengthen China’s military. China’s controls, to take effect from August 1, will apply to eight gallium-related products: gallium antimonide, gallium arsenide, gallium metal, gallium nitride, gallium oxide, gallium phosphide, gallium selenide and indium gallium arsenide. They will also apply to six germanium products: germanium dioxide, germanium epitaxial growth substrate, germanium ingot, germanium metal, germanium tetrachloride and zinc germanium phosphide. https://reut.rs/3przF3S