TheChek News Flow

----> AMD at CES

AMD has its work cut out for it at CES 2025. Competitor Nvidia has been sucking the oxygen out of every room it graces, as the chipmaker remains at the forefront of the AI boom. So, how will AMD compete with Nvidia’s reported RTX 5000 announcement? The company should show of its own next-gen GPU.

As part of an ongoing rebrand, the RDNA 4 cards could arrive as either the RX 8000 or RX 9000 series. Regardless of the name and number the company lands on, AMD has its work cut out for it at this year’s show.

The presser kicks off on the early side at 11 a.m. PT/2 p.m. ET on January 6. The company explains, “AMD senior vice president and general manager of the Computing and Graphics Group Jack Huynh, along with other AMD executives will be joined by partners and customers to discuss how AMD is expanding its leadership across PCs and gaming, and highlight the breadth of the company’s high-performance computing and AI product portfolio.”

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--> Sony at CES

Sony knows how to put on a show at CES. The company’s pressers are high-octane, star-studded affairs, as these things go. In addition to standard Sony fare like TVs and audio systems, there’s always a curve ball or two, be it a car, a drone, or a “Gran Turismo” movie. That’s one of the perks of being a massive corporation with your fingers in a lot of verticals.

This year’s press event kicks off at 5 p.m. PT/8 p.m. ET on January 6. We’ve already seen some of what Sony will offer, including the SRH-S1 extended reality headset and additions to the Bravia home theater line.

Sony will be streaming the press conference over on its own site and on YouTube.

xAI, Elon Musk’s AI company, has raised $6 billion in a Series C financing round.

The company announced this week that Andreessen Horowitz , Blackrock, Fidelity, Lightspeed, MGX, Morgan Stanley, OIA, QIA, Sequoia Capital, Valor Equity Partners, Vy Capital, Nvidia, AMD, and others participated.

Kingdom Holdings, the Saudi conglomerate holding company, invested roughly $400 million in the round, according to a public filing. The filing also revealed that xAI is now valued at $45 billion, close to double its previous valuation.

The new cash brings xAI’s total raised to $12 billion, adding to the $6 billion tranche xAI raised in May.

According to the Financial Times, only investors who’d backed xAI in its previous fundraising round were permitted to participate in this one. Reportedly, investors who helped finance Musk’s Twitter acquisition were given access to up to 25% of xAI’s shares.

“xAI’s most powerful model yet … is currently training and we are now focused on launching innovative new consumer and enterprise products,” xAI said in a statement. “The funds from this financing round will be used to further accelerate our advanced infrastructure, ship groundbreaking products … and accelerate … research and development.”

Musk formed xAI last year. Soon after, the company released Grok, a flagship generative AI model that now powers a number of features on X, including a chatbot accessible to X Premium subscribers and free users in some regions.

Grok has what Musk has described as “a rebellious streak” — a willingness to answer “spicy questions that are rejected by most other AI systems.” Told to be vulgar, for example, Grok will happily oblige, spewing profanities and colorful language you won’t hear from ChatGPT.

Musk has derided ChatGPT and other AI systems for being too “woke” and “politically correct,” despite Grok’s own unwillingness to cross certain boundaries and hedge on political subjects. He’s also referred to Grok as “maximally truth-seeking” and less biased than competing models, although there’s evidence to suggest that Grok leans to the left.

Over the past year, Grok has become increasingly ingrained in X, the social network formerly known as Twitter. At launch, Grok was only available to X users — and developers skilled enough to get the “open source” edition up and running.

Thanks to an integration with xAI’s in-house image generation model, Aurora, Grok can generate images on X (without guardrails, controversially). The model can analyze images as well, and summarize news and trending events — imperfectly, mind.

Reports indicate that Grok may handle even more X functions in the future, from enhancing X’s search capabilities and account bios to helping with post analytics and reply settings. X recently got a “Grok button” designed to help users discover “relevant context” and dive deeper into trending discussions and real-time events.

xAI is sprinting to catch up to formidable competitors like OpenAI and Anthropic in the generative AI race. The company launched an API in October, allowing customers to build Grok into third-party apps, platforms, and services. And it just rolled out a standalone Grok iOS app to a test audience.

Musk asserts that it hasn’t been a fair fight.

In a lawsuit filed against OpenAI and Microsoft, OpenAI’s close collaborator, attorneys for Musk accuse OpenAI of “actively trying to eliminate competitors” like xAI by “extracting promises from investors not to fund them.” OpenAI, Musk’s counsel says, also unfairly benefits from Microsoft’s infrastructure and expertise in what the attorneys describe as a “de facto merger.”

Yet Musk often says that X’s data gives xAI a leg up compared to rivals. Last month, X changed its privacy policy to allow third parties, including xAI, to train models on X posts.

Musk, it’s worth noting, was one of the original founders of OpenAI, and left the company in 2018 after disagreements over its direction. He’s argued in previous suits that OpenAI profited from his early involvement yet reneged on its nonprofit pledge to make the fruits of its AI research available to all.

OpenAI, unsurprisingly, disagrees with Musk’s interpretation of events. In a mid-December press release, the company characterized Musk’s lawsuit as misleading, baseless, and a case of sour grapes.

xAI has outlined a vision according to which its models would be trained on data from Musk’s various companies, including Tesla and SpaceX, and the models could then improve technology across those companies. xAI is already powering customer support for SpaceX’s Starlink internet service, according to The Wall Street Journal, and the startup is said to be in talks with Tesla to provide R&D in exchange for some of the carmaker’s revenue.

Tesla shareholders, for one, object to these plans. Several have sued Musk over his decision to start xAI, arguing that Musk has diverted both talent and resources from Tesla to what’s essentially a competing venture.

Nevertheless, the deals — and xAI’s developer and consumer-facing products — have driven xAI’s revenue to around $100 million a year. For comparison, Anthropic is reportedly on pace to generate $1 billion in revenue this year, and OpenAI is targeting $4 billion by the end of 2024.

Musk said this summer that xAI is training the next generation of Grok models at its Memphis data center, which was apparently built in just 122 days and is currently powered partly by portable diesel generators. The company hopes to upgrade the server farm, which contains 100,000 Nvidia GPUs, next year; in a press release, xAI said it plans to fully double that number. (Because of their ability to perform many calculations in parallel, GPUs are the favored chips for training and running models.)

In November, xAI won approval from the regional power authority in Memphis for 150MW of additional power — enough to power roughly 100,000 homes. To win the agency over, xAI pledged to improve the quality of the city’s drinking water and provide the Memphis grid with discounted Tesla-manufactured batteries. But some residents criticized the move, arguing it would strain the grid and worsen the area’s air quality.

Tesla is also expected to use the upgraded data center to improve its autonomous driving technologies.

xAI has expanded quite rapidly from an operations standpoint in the year since its founding, growing from just a dozen employees in March 2023 to over 100 today. In October, the startup moved into OpenAI’s old corporate offices in San Francisco’s Mission neighborhood.

xAI has reportedly told investors it plans to raise more money next year.

It won’t be the only AI lab raising immense cash. Anthropic recently secured $4 billion from Amazon, bringing its total raised to $13.7 billion, while OpenAI raised $6.6 billion in October to grow its war chest to $17.9 billion.

Megadeals like OpenAI’s and Anthropic’s drove AI venture capital activity to $31.1 billion across over 2,000 deals in Q3 2024, per PitchBook data.

Despite criticism over conduct of Gaza war, some see new diplomatic opportunities

TEL AVIV—Since the Hamas attacks on Oct. 7, 2023, Israel has dealt a series of damaging setbacks to its most dangerous regional adversaries. It has hobbled Hamas in Gaza, severely damaged Shiite militia Hezbollah in Lebanon and fended off missile salvos from Tehran while landing its own blows in Iran.

Israel’s military operations—especially its conduct of the war in Gaza, where local authorities say more than 40,000 Palestinians have died—have hurt the country’s international standing. The International Criminal Court has issued arrest warrants for its prime minister and former defense minister.

But Israel’s leaders say the military gains are worth the trade-off in reputational damage and argue that the country’s stronger strategic position opens the door for diplomatic gains in the future as Arab countries look for partners to keep Iranian power at bay.

“For the first time in the history of Zionism, there is an opportunity for Israel to be a regional power,” said Avner Golov, a former senior director at Israel’s National Security Council, who is now a vice president at MIND Israel, which advises governments on national security.

It won’t be an easy feat to pull off, especially as public opinion across the Arab world has soured on Israel because of the Gaza war. But with the world’s eyes focused on the horrors emerging from the wreckage of the Assad regime and a Gaza cease-fire potentially on the horizon, Israel might be in a position to repair its international image and diplomatic standing.

Current and former Israeli officials are pushing for aggressive steps to build an Israeli, American and moderate Arab alliance that includes Saudi Arabia and is aimed at checking Iran’s influence. The re-election of Donald Trump, who confronted Iran in his first term and is returning to the presidency next month, has raised hopes for such an alliance, said Golov.

The Gaza war set in motion a sequence of events that has helped lay the groundwork, said Danny Danon, Israel’s ambassador to the United Nations. Israel has weakened Iran by largely incapacitating its military allies Hamas in Gaza and Hezbollah in Lebanon. Those successes triggered the recent fall of the regime of Bashar al-Assad in Syria, a key Tehran ally. Israel has also decimated Iran’s air defenses in two rounds of tit-for-tat airstrikes, leaving Tehran vulnerable in any future confrontation.

“We expect our determination and strength shown over the past year will lead to more regional stability,” said Danon.

Sharren Haskel, Israel’s deputy foreign minister, said that, because Israel is on the front lines and has shown its military prowess, “many more countries are realizing that we need to work together in collaboration.” Deepened ties, including normalization with Saudi Arabia, would further isolate Iran, she said.

The two countries were close to such a pact before the war, but Riyadh has since become highly critical of Israel’s actions in Gaza and elsewhere. Yet the kingdom has retained its prewar stance that normalization is possible if Israel agrees to resolve the issue of Palestinian statehood.

Israelis overwhelmingly oppose a Palestinian state now, but Israel could give Palestinians a clear road map to self-governance in Gaza and the West Bank, Golov said. It is unclear whether Saudi Arabia would accept such a compromise.

Israeli Prime Minister Benjamin Netanyahu would struggle to pass such measures with his current coalition, analysts say, because it relies on far-right parties who want to tighten rather than loosen Israeli control over the Palestinian territories. Netanyahu himself has stressed since the current war began that he would oppose a Palestinian state.

Netanyahu recently told The Wall Street Journal that there is optimism for normalization with Saudi Arabia once Israel secures a deal to release hostages held by Hamas in Gaza and pause the fighting there.

Not everyone agrees Israel’s military achievements have made itself or the region safer, and there are risks that the war’s trade-off could still prove costly to Israel.

The widely televised devastation in the Gaza Strip and the rising death toll there have sowed the seeds for future conflicts between Israel and its neighbors, said Hussein Ibish, senior resident fellow at the Arab Gulf States Institute, a think tank in Washington.

Israel’s military victories, Ibish added, have created a situation in which it will need more soldiers to guard its borders with Lebanon, Syria and the Gaza Strip—as well as in the West Bank, which is partially occupied by Israel.

“It is really surrounded by bitter enemies who have much more reason to be bitter enemies today than they did on Oct. 7,” he said.

Across the Middle East and in many developing countries, meeting with Israeli leaders has become taboo, stifling future cooperation, said William Wechsler, senior director of Middle East programs at the Atlantic Council, a think tank in Washington.

Israel has faced diplomatic blowback in the past. Itamar Rabinovich, a former Israeli ambassador to the U.S. and adviser to several prime ministers, thinks it will wane. Israel is a magnet for such criticism today, he said, but that will decrease over time once the war ends.

“Israel enjoys massive unquestionable U.S. support not just because of the need to respond to a Hamas attack or Hezbollah, but the sense that there are important U.S. interests at stake,” said Rabinovich.

The current Middle East conflict, for example, has wider significance as Iran develops closer ties with Russia, which is in turn close to countries that are competing with the U.S. and its allies, Rabinovich said. “It’s not just a regional conflict, but a global one, against the Russia, China, North Korea coalition.”

From the start of the war, one of the key questions for Israel in weighing the war’s trade-offs was whether it would have a free hand to pursue its military goals before the diplomatic consequences became overwhelming, said Micah Goodman, an Israeli author and philosopher.

“We needed to restore deterrence—and in order to restore deterrence, we needed to do things that reduce our legitimacy,” Goodman said. But on balance, he added, “I think Israel managed to pull it off.”

Seoul Semiconductor recently filed a series of patent lawsuits against rival lighting companies and global retailers

Signify, the Dutch multinational lighting company formerly known as Philips Lighting LIGHT 0.48%increase; green up pointing triangle, has been ordered by a German court to recall products allegedly infringing on patents of South Korea’s Seoul Semiconductor 046890 1.78%increase; green up pointing triangle for more than seven years.

A court in Düsseldorf, Germany, last week dismissed Signify’s request to invalidate the patents in question and imposed an immediate sales ban on all of the company’s Philips-brand goods that a ruling said violated patent rights, a Seoul Semiconductor executive told Dow Jones Newswires on Thursday.

The court on Dec. 17 ordered Eindhoven-based Signify to recall and destroy all patent-infringing goods sold through European multinational retailer Conrad Electronic since March 29, 2017. The court also ruled that Signify should be fined $250,000 for any single violation of the sales ban, the executive said, speaking on the condition of anonymity because the information hasn’t been made public.

The executive said that the ruling focuses on patented technology, not just individual products, and that the technology applies to products beyond the Philips brand.

Signify, which reported more than $7 billion in revenue last year, said when contacted that it is still actively involved in the continuing patent case.

“Signify is not a defendant in the patent infringement litigation,” Tom Lodge of the company’s corporate communications team said in an email. “Signify is of the opinion that these patents are invalid and therefore [the company] started the current patent invalidity case.”

Seoul Semiconductor personnel said the German court’s decision upheld an earlier ruling that Signify had infringed on their company’s patented technology for lighting with “a color rendering index above 70” to reproduce the colors of objects as close as possible to those in nature.

They said the court decision could have a sizable impact on a global lighting-product market that tops $100 billion in annual sales, as well as on other continuing patent disputes.

Seoul Semiconductor recently filed a series of patent lawsuits against rival lighting companies and global retailers. The light-emitting diode maker said it holds around 18,000 patents after spending nearly $100 million annually in research and development over the past two decades.

The company’s EV business launched its first car in March

Chinese consumer-electronics specialist Xiaomi 1810 3.15%increase; green up pointing triangle will join the electric-vehicle charging networks of rivals NIO NIO 3.13%increase; green up pointing triangle, XPeng XPEV 1.33%increase; green up pointing triangle and Li Auto LI 1.37%increase; green up pointing triangle, giving customers of its emerging auto business access to tens of thousands of charging stations in China.

Xiaomi said in a Weibo post Wednesday that its cars can now be used at more than 14,000 charging stations developed by NIO, 9,000 by XPeng and 6,000 by Li Auto. It didn’t provide further details of the deals.

CCB International analyst Qu Ke described the tie-ups as “a natural move for Xiaomi to make the most of available resources.”

Xiaomi, known mainly for its smartphones and home appliances, is a late entrant to the world’s biggest market for EVs, but it has seen robust sales performance in the crowded and competitive space. Its EV business launched its first car in March, with the segment going on to generate 9.7 billion yuan in revenue, equivalent to $1.33 billion, in the third quarter. The business’s gross profit margin improved to 17.1% from 15.4% in the second quarter.

Xiaomi reached its 2024 delivery goal of 100,000 units in November, earlier than expected, prompting it to raise its annual target to 130,000 units.

Shares of the company, which closed at 32.75 Hong Kong dollars before the Christmas holiday break, have more than doubled this year, thanks to strong earnings and a better-than-expected EV business.

Taiwan Blocks Uber’s $950 Million Takeover of Local Foodpanda Business

Uber had aimed to close the deal in the first half of 2025

Taiwan has blocked Uber Technologies’ UBER -0.26%decrease; red down pointing triangle planned $950 million takeover of Foodpanda’s local delivery business on anticompetition concerns, thwarting the U.S. company’s efforts to expand in Asia.

Taiwan’s Fair Trade Commission said Wednesday that competition pressure on Uber’s food-delivery unit in Taiwan stems mainly from Foodpanda, and that eliminating that dynamic would incentivize Uber to raise prices for consumers and eateries on its platform.

The merger would also make it more difficult for other potential competitors to enter the market, the FTC said.

Uber said in a statement that it was disappointed by the decision, and that it had previously made proposals to address Taiwan’s competition concerns. It said it would nonetheless continue to invest in Taiwan, which it described as one of the world’s fastest-growing markets for food delivery.

Delivery Hero, the Berlin-based owner of Foodpanda, said Uber could appeal the decision or terminate the deal.

San Francisco-based Uber in May had announced its plans to buy Foodpanda’s Taiwan delivery business for $950 million in cash, along with a separate $300 million purchase of newly issued ordinary shares of Delivery Hero. It had aimed to close the deal—one of the largest international acquisitions in Taiwan outside of the semiconductor industry—in the first half of 2025.

Uber, which also has operations in Japan and Hong Kong in Asia, said at the time that it expected the acquisition to contribute at least $150 million annually to the adjusted earnings before interest, taxes, depreciation and amortization of its delivery business within 12 months of closing.

Asia is Delivery Hero’s largest market, accounting for about 36% of the company’s revenue in 2023. Foodpanda’s operations in Taiwan were breakeven in terms of adjusted Ebitda in the fiscal year ending March 2024, Delivery Hero said in May.

AI phones could sustain chip sector if data centre spending slows, says Nvidia supplier

Advantest chief warns any faltering in Big Tech’s AI investments will reverberate through supply chain

Demand for artificial intelligence-enabled smartphones could help to protect parts of the semiconductor industry from a “vicious” downturn if investment in data centres slows, said the chief executive of the world’s largest provider of chip testing machines.

Doug Lefever, who leads Nvidia supplier Advantest, said he was watching for any sign of slower spending on AI by big US tech groups. Meta, Google and Microsoft have been heavy investors in data centres that can deliver massive amounts of computing power.

A fall-off “may not last long and then it may go right back up, but because of the concentration [of hyperscalers] right now in the market, any slowdown in the data centre buildout is going to have big reverberations in the supply chain”, said Lefever.

“I don’t like to use the word bubble because it implies that it’s going to go away, but there will be cycles,” he said. “When that next cycle comes . . . it could be pretty vicious.”

In contrast, demand for AI smartphones was “kind of slow” but could take off rapidly, Lefever said.

“Everyone is holding their breath, waiting for the killer app with the AI handsets . . . if that happens and people start replacing their phones, it’s going to be crazy,” he said.

Tokyo-based Advantest, a key supplier of testing equipment for Nvidia’s high-end graphics processing units, is one of the companies to benefit most from the rapid rise in demand for semiconductors.

The company controls more than half of the semiconductor testing market, and demand for its services has skyrocketed as chips have become more advanced and expensive.

That dominance has lifted its share price by more than 80 per cent over the past year and about 500 per cent over a five-year period, with a recent dip in December attributed to fears that incoming president Donald Trump would get tougher on China.

While Japan has lost its leading position from the 1980s in chip production, Advantest is part of a cluster of Japanese semiconductor equipment and materials companies that hold dominant market positions in niche yet indispensable parts of the supply chain.

A completed advanced chip might now be tested by Advantest machines between 10 and 20 times, according to Lefever, from when the wafer is cut to the assembly of the finished product. Five years ago, that figure was in single digits.

Testing times have also been extended, with Nvidia’s latest Blackwell product taking three or four times longer to test than the previous generation. This gave Advantest the confidence in October to raise its net income target for the 2024 fiscal year by 16 per cent to ¥122bn ($792mn).

The trend of increasing demand for Advantest machines — which can cost $1mn and have more parts than a commercial aircraft — is unlikely to abate soon. It has focused on higher-end performance testing and in some categories has over 60 per cent market share, according to analysts.

The company is in 18 countries but still draws between 20 and 25 per cent of revenues from China, a level that has fallen recently but with which Lefever says he is comfortable.

It has not been directly targeted by US restrictions to curtail China’s ability to produce advanced technology, in part because sanctions tend to target the ability to fabricate the chips themselves.

Even if China were completely closed off, Lefever expected demand to be healthy enough elsewhere to compensate. When one big company in China was hit by sanctions recently, the lost sales were quickly compensated for by other customers, he said.

“We thought it could be a year, and it was months,” he said. “It was remarkable.”

China’s EV sales set to overtake traditional cars years ahead of west

Volumes forecast to rise 20% next year, smashing international projections and Beijing’s official targets

Electric vehicles are expected to outsell cars with internal combustion engines in China for the first time next year, in a historic inflection point that puts the world’s biggest car market years ahead of western rivals.

China is set to smash international forecasts and Beijing’s official targets with domestic EV sales — including pure battery and plug-in hybrids — growing about 20 per cent year on year to more than 12mn cars in 2025, according to the latest estimates supplied to the Financial Times by four investment banks and research groups. The figure would be more than double the 5.9mn sold in 2022.

At the same time, sales of traditionally powered cars are expected to fall by more than 10 per cent next year to less than 11mn, reflecting a near 30 per cent plunge from 14.8mn in 2022.

Meanwhile, EV sales growth has slowed in Europe and the US, reflecting the legacy car industry’s slow embrace of new technology, uncertainty over government subsidies and rising protectionism against imports from China.

Robert Liew, director of Asia-Pacific renewables research at Wood Mackenzie, said China’s EV milestone signalled its success in domestic technology development and securing global supply chains for critical resources needed for EVs and their batteries. The industry’s scale meant steep manufacturing cost reductions and lower prices for consumers.

“They want to electrify everything,” said Liew. “No other country comes close to China.”

While the pace of Chinese EV sales growth has eased from a post-pandemic frenzy, the forecasts suggest Beijing’s official target, set in 2020, for EVs to account for 50 per cent of car sales by 2035, will be achieved 10 years ahead of schedule. 

Industry forecasts were provided to the FT by investment banks UBS and HSBC, as well as research groups Morningstar and Wood Mackenzie.

They imply that over the coming decade, factories set up in China to produce tens of millions of cars with traditional engines will have almost no domestic market to serve.

They also highlight how the rapid rise of the Chinese EV industry now threatens the national manufacturing champions of Germany, Japan and the US. 

As China’s EV market tracked towards year-on-year growth of near 40 per cent in 2024, the market share of foreign-branded cars fell to a record low of 37 per cent — a sharp decline from 64 per cent in 2020, according to data from Automobility, a Shanghai-based consultancy.

In this month alone, GM wrote down more than $5bn of its business value in China; the holding company behind Porsche warned of a writedown in its Volkswagen stake of up to €20bn; and arch rivals Nissan and Honda said they were responding to a “drastically changing business environment” with a merger.

Chinese carmakers face their own internal rivalry. Yuqian Ding, a veteran Beijing-based analyst with HSBC, said that while EVs were now a “strategically important” part of China’s new, high-tech economy, intense competition was expected to “squeeze” more players out of the market as the industry consolidated.

“While China’s domestic EV sector is clearly flourishing, it is also facing slowing growth — from a very high base — models oversupply, intense competition and a price war,” she said. “The longer-term direction of travel is clear — China’s EV juggernaut is unstoppable.”

Tu Le, founder of consultancy Sino Auto Insights, said the industry was only at “the beginning” of a period of unparalleled upheaval.

Vincent Sun, an equity analyst covering China’s car sector for investment research group Morningstar, noted that several multinational carmakers, including Germany’s Volkswagen, were not expecting to release major new EV models in China until late 2025 or 2026.

HSBC estimated about 90 new car models had been planned for release by manufacturers in China in the fourth quarter of 2024 — about one a day — and nearly 90 per cent were EVs.

Still, Paul Gong, head of Chinese automotive research at UBS, cautioned there was some uncertainty over China’s broader economic policy heading into 2025 and forecast the market would have a “weak start to the year” after a robust finish to 2024.

But he added: “We anticipate . . . a strong surge in purchases at the end of 2025, driven by the expiration of subsidies and the imposition of a 5 per cent purchase tax on electric vehicles in 2026 — compared to 0 per cent until the end of 2025.”