FT : Wealthy Chinese sidestep Singapore for Dubai

Wealthy Chinese sidestep Singapore for Dubai
Private bankers and advisers report rise in interest in the Gulf as Asian city-state tightens scrutiny of applicants

An increasing number of wealthy Chinese people are trying to set up family offices and secure residency in the Gulf, a reflection of growing frustration with the increased difficulty of establishing themselves in Singapore, long a popular destination for rich Asians.

In the past year, there has been a rise in enquiries from Chinese nationals eager to relocate to Dubai and Abu Dhabi, according to private bankers and advisers to the ultra rich. Setting up family offices can ease the process of securing citizenship or residency.

“They are attracted [to the Gulf] by the ability to get residency status and live and enjoy stability,” said Mike Tan, Standard Chartered’s Singapore-based global head of wealth planning and family advisory, of those enquiring about setting up family offices in the Gulf.

Tan said the number of enquiries about Dubai that Standard Chartered had received from east Asian clients had surged in the past year, though the bank declined to provide numbers.

The UAE golden visa, which offers residency for 10 years and is available to investors, some family members and some high skilled workers, “is very attractive, and it is stable and benign from a tax perspective,” he said. Authorities in the United Arab Emirates said they issued nearly 80,000 golden visas in 2022 in a sharp increase from 47,000 the previous year, the latest figures to be made publicly available.

The number of family-related entities in Dubai’s offshore financial centre hit 1,000 at the end of the first half of this year, according to official figures, compared with 800 at the end of last year and 600 at the end of 2023. There is no breakdown on origin, but advisers say that much of the rise can be attributed to Chinese individuals.

Such is the influx of wealthy customers to the Gulf, said Prashant Tandon, managing director of wealth manager Lighthouse Canton’s UAE business, that there is a shortage of financial professionals who speak Chinese.

Tandon said he had seen the greatest movement towards the United Arab Emirates among those with assets of $50mn-200mn — “the mid-segment” of high net worth individuals — who are “a lot more entrepreneurial” and may be feeling business pressures in mainland China or Hong Kong. 

“A lot of families have sold Singaporean real estate to reinvest in the UAE,” said Yann Mrazek, managing partner at M/HQ, which assists with setting up structures for fund managers and family offices in Dubai and Abu Dhabi. Harsh Covid lockdowns in places such as China and Singapore had first triggered the interest in Gulf hubs, he said.

“Singapore has very restrictive immigration rules — they want to ensure the right people come in,” said an adviser to wealthy families in the city-state. “It is relatively easy to set up a family office and get employment passes, but much harder to get residency and citizenship.”

But while Dubai’s family office market is growing fast, it has years of catching up to do with Singapore.

Government incentives prompted many wealthy foreigners to consider setting up family offices in Singapore in recent years as part of a pathway to becoming permanent residents. The number of family offices in Singapore rose by 43 per cent last year to more than 2,000.

“For a while, people were setting up family offices as a status symbol in Singapore — if your friend had one, you should have one too,” said Kevin Teng, chief executive of wealth manager Wrise Private Singapore. “But it meant a lot of these entities weren’t doing very much.”

Singapore granted an average of 33,000 permanent residencies and 21,300 citizenships a year over the past five years, according to the Immigration & Checkpoints Authority, which does not disclose the number of applicants. Immigration consultants report the approval rate can be as low as 8.25 per cent.

A money-laundering case, believed to be the city state’s largest, involving individuals linked to a gang from China’s Fujian province prompted greater scrutiny of individuals and flows.

More crypto entrepreneurs from China are also looking to set up in the Middle East, said Teng. There are now 39 cryptocurrency companies fully licensed by VARA, Dubai’s special regulator for the sector.

“In the crypto and digital asset space, they [Chinese clients] are looking at how friendly the local regulators are,” said Teng. “A lot of the time it can be down to how much risk appetite the different jurisdictions have and Singapore is being a bit more risk averse, certainly compared to Dubai.” 

The Monetary Authority of Singapore has granted 36 licences for digital payment companies, though it began cracking down on unlicensed crypto exchanges this summer. “Clients are increasingly going to the Middle East,” said Teng. “That is definitely a growing business segment for us.”

FT : Whistleblowers could earn millions as HMRC targets tax fraud

Whistleblowers could earn millions as HMRC targets tax fraud
US-style incentive scheme expected to be announced at Budget later this month

Whistleblowers of large-scale tax fraud will soon start to receive millions of pounds in exchange for information under a new US-style incentive programme that is the first of its kind in the UK.

HM Revenue & Customs is set to launch the reward scheme later this month and could pay as much as 30 per cent of any taxes collected as a result of tip-offs from informants, according to people with knowledge of the situation.

Details of the programme, including the final reward cap, are expected to be announced at the Budget on November 26, the people said.

The move will be welcomed by whistleblowers who often suffer financially after coming forward about wrongdoing, while also strengthening the government’s ability to clamp down on tax fraud.

“By providing a financial safety net for whistleblowers in the form of monetary rewards, HMRC is poised to supercharge its enforcement capabilities,” said Mary Inman, a US lawyer at the specialist law firm Whistleblower Partners.

“Well-placed, financially motivated whistleblowers and their lawyers will be force multipliers for the UK’s efforts to fight tax fraud.”   

The incentive scheme is just one of the measures chancellor Rachel Reeves is pursuing as she seeks to fill a fiscal hole in the UK’s finances estimated by economists at between £20bn and £30bn. The government loses about £47bn a year from unpaid taxes.

HMRC estimates that tax evasion cost £5.5bn in lost revenue in 2022-23, but that number is believed to be vastly underestimated.

When the Treasury first announced plans for an incentive scheme in March, it explicitly said it would “take inspiration from the successful US and Canadian ‘whistleblower’ models”.

HMRC officials met a range of US agencies that have similar programmes over the summer, including the US Internal Revenue Service, to learn more about how they operate, said two people with knowledge of the meetings.

Since 2007, the IRS has awarded $1.3bn to whistleblowers from $7.4bn in missed taxes collected as a result of their information, according to its annual 2024 report. It offers between 15 per cent and 30 per cent of taxes recouped to successful whistleblowers, involving cases with a minimum $2mn government recovery.

The scheme will mark a significant departure from the UK’s approach to whistleblowing, which has traditionally opted against such large-scale rewards, instead taking the view that people should do the right thing without a financial incentive.

Lawyers and prosecutors, including the director of the UK’s Serious Fraud Office, have long called for a reward programme to increase the number of successful prosecutions for economic crime in Britain.

While some small financial incentive programmes already exist, including at HMRC and the UK Competition and Markets Authority, they are not well publicised and the rewards are small. 

HMRC paid out less than £1mn to whistleblowers in 2023-24. By comparison, the largest single reward paid out by the Securities and Exchange Commission was $279mn in 2023.

The new scheme will run in parallel with the old programme and will target higher-value tax fraud, the people said.

HMRC may also benefit from whistleblowers outside the UK as US agencies pursuing economic crime are experiencing staff shortages under President Donald Trump’s administration, said Inman.

A spokesperson for the Treasury declined to comment on “speculation” around any changes ahead of the Budget.

FT : Chinese automakers are overtaking European rivals, says car-shipping chief

Chinese automakers are overtaking European rivals, says car-shipping chief
World’s biggest operator, Wallenius Wilhelmsen, aims to boost revenue by helping newer Beijing brands expand overseas

European carmakers are rapidly losing market share globally as Chinese rivals enter a new phase of expansion and innovation, said the head of the world’s biggest operator of car-carrying ships.

Lasse Kristoffersen, chief executive of Wallenius Wilhelmsen, told the Financial Times there was “massive growth” in shipments from China to Latin America, Europe, Africa and Australia amid Beijing’s domestic crackdown on price cuts.

“The reason why Chinese are winning market shares is because they innovate themselves,” he told analysts on a recent earnings call. “The Chinese producers have gone from being cost leaders to now being technology leaders.”

Chinese exports jumped by 23 per cent to 6.4 million passenger vehicles last year, more than 50 per cent higher than second place Japan, according to AlixPartners.

The consultancy expects Chinese manufacturers to capture 30 per cent of the global automotive market by 2030, up from 21 per cent last year, and driven by growth in emerging markets.

Chinese brands including BYD, Chery and MG owner SAIC have expanded rapidly in western Europe and accounted for 5.7 per cent of new car sales in the first nine months of the year, up from 3.2 per cent for the same period last year, according to Schmidt Automotive Research.

China’s proportion of the battery EV market in Europe is even higher at 10 per cent over the past nine months.

While Japanese and US brands appear to have lost some European market share to Chinese rivals, Kristoffersen suggested the sales growth for Chinese cars elsewhere came at the expense of the continent’s carmakers.

European carmakers face a triple whammy of shrinking sales in China, sluggish demand at home and higher US tariffs. “They are challenged in both their home market and in their east and west overseas markets, but we do see that they are taking measures,” Kristoffersen said. 

Foreign governments have moved to limit shipments from China, with the US in effect banning imports and the EU raising tariffs on Chinese electric vehicles. Still, overseas sales have become even more critical for Chinese manufacturers as they grapple with bruising price wars at home.

Wallenius Wilhelmsen has historically benefited from western carmakers shipping their products to China. But the Norwegian group, which sells space on its ships to carmakers, is now trying to capture more revenue by helping newer Chinese brands to expand overseas. 

BYD, the world’s largest and fastest-growing EV maker, is constructing a fleet of eight ships to transport its cars globally. It also has factories in Brazil, Hungary, Indonesia, Thailand, Turkey and Uzbekistan.

Kristoffersen said he did not see BYD or other customers emerging as rivals to Wallenius Wilhelmsen, but did expect competition from Chinese shipping giants such as Cosco.

“When we speak to our Chinese customers, they bought vessels and built vessels because they were afraid of not getting access to capacity. That fear is easing . . . so there will be Chinese players, but it’s not the most likely scenario that our customers will become our competitors.”

FT : EDF boss vows to speed up nuclear projects and narrow gap to Asian peers

EDF boss vows to speed up nuclear projects and narrow gap to Asian peers
The state-owned French group wants to use Sizewell C in the UK to showcase its capabilities

EDF’s new boss has vowed to speed up the delivery of new nuclear reactors in an increasingly competitive market, after costly overshoots in the past weighed on the French energy group.

The company wants to use the development of the UK’s Sizewell C nuclear power station to show that huge reactors capable of powering millions of homes can be delivered at speed, in the hope that this will help it attract private funding and compete with more efficient rivals, including those from Asia.

Bernard Fontana, chief executive, said the state-owned group remained “open to international markets” and hoped to export more of its designs beyond the projects it is undertaking in the UK and France.

EDF has been tasked with delivering at least six new French reactors from 2038 onwards and is due to deliver two for the £38bn Sizewell C project in the middle to late 2030s.

It is aiming to be able to build a reactor in about six years by the time the last pair of French reactors are under way. That is still slower than the five years achieved by some Chinese developers, but an improvement on its own record of taking well over a decade.

“We’re moving into a phase in which of course safety comes first, quality needs to be there too, but it also needs to go faster,” Fontana, who took the top job at EDF in May, told the Financial Times. “It’s the swiftness of the execution which also makes [projects] economically efficient.”

Financing was finalised for Sizewell C this week. If the project is completed in 10-12 years as planned, it will be a huge improvement on EDF’s recently launched Flamanville 3 reactor in Normandy, France, which was meant to be a five-year project, but took 18 years, with the budget ballooning sevenfold.

“There’s a deep well [of efficiency] to be had and which we need to exploit . . . We can surprise positively on the timeline of our programmes,” said Fontana, previously boss of EDF-owned nuclear component maker Framatome.

Fontana’s push for efficiency comes as EDF, weighed down by a net debt of €50bn, needs to finance €30bn of investments annually over the next five years, including on maintaining current sites, according to estimates by France’s budget watchdog. EDF operates 57 French reactors.  

EDF’s boss confirmed that the group was reviewing its portfolio of assets, including and selling parts of its renewables portfolio in the US and Brazil. It could also list or sell a stake in its Italian utility Edison.

EDF like rivals including Westinghouse of the US, was hamstrung by a hiatus in government orders that was worsened by the 2011 Fukushima meltdown in Japan. Covid pandemic stoppages and shifting safety demands from regulators also emerged as hurdles. EDF also made costly errors, and had to redo parts of its plants.

The global industry is dominated by Russia and China, and EDF is also facing competition from Westinghouse and South Korea’s Korea Hydro & Nuclear Power for European tenders.

All of EDF’s other European Pressurised Reactor designs completed in recent years, in Finland and China, experienced delays. In the UK, it is working on the Hinkley Point C — a sister project to Sizewell C that is being built in Somerset and is several years behind, and over budget.

Fontana said EDF would speed up processes through mass production of components like steam generators, while managers and suppliers had gained experience from shuttling between different projects. 

“To mobilise our teams I’ve made them calculate the cost of an hour’s work at our construction sites,” Fontana said, adding it could reach up to €1mn. “So if it takes six weeks to reach a decision, that’s an expensive decision . . . we need to find set-ups that allow us to make 90 per cent of decisions in a quarter of an hour.”

Delivering Sizewell C — in which EDF has 12.5 per cent — on time will be vital to attracting private funders for future projects. The project will rely on a “regulated asset base” financing model, which reduced risk for investors by giving them a guaranteed return during the construction.

The UK’s Centrica, Canada’s La Caisse and London-based Amber Infrastructure have committed to a combined equity of £3.25bn to Sizewell C, which has the government as biggest stakeholder and financier.

“There were more interested parties than stakes to be had in the financing,” Fontana said. “It’s a project that shows investors’ confidence in a nuclear project which can also be financially sustainable.”

>>> Barron’s weekend Summary

Cover:
-China's economy is undergoing a significant transformation, particularly in the fields of robotics, biotechnology, and artificial intelligence, exemplified by XtalPi Holdings, a biotech firm that accelerates drug discovery through AI. Founded by MIT-trained physicists, XtalPi partners with major pharmaceutical companies and signifies a shift from China as merely a manufacturer to an innovator in developing treatments for serious diseases. Research and development spending in China has been increasing at a rate of nearly 9% annually, outpacing the USA and resulting in a substantial number of international patents and industrial robot installations. However, the economic landscape remains challenging, with contracting investments, slowing retail sales growth, a shrinking population, a struggling property market, and high debt levels. Consequently, annual economic growth is projected to remain low, between 3% and 4%, down from prior rates of 6% to 8%.
Interview:
-No Update
Tech Trader:
-During Palantir Technologies' third-quarter earnings call, CEO Alex Karp claimed their results were potentially the best ever for a software company, with a Rule of 40 score of 105, driven by 63% revenue growth and a 42% free cash flow margin. While impressive, these results were not the best in software history, nor the best recently, as evidenced by Zoom Communications' remarkable performance during early COVID-19, averaging 363% revenue growth with a Rule of 40 score averaging 413 across three quarters. Ultimately, despite initial success, Zoom struggled to maintain its position as competitors like Microsoft and Google emerged.
The Trader:
-Starbucks has announced the sale of a 60% stake in its China operations to Boyu Capital for a $4B enterprise value, establishing a joint venture. This move aims to leverage Boyu's understanding of Chinese consumers and helps Starbucks de-risk from the Chinese market while refocusing on its US business. Analysts view this transaction positively, citing historical precedence with other US brands such as McDonald's and Yum! Brands, which similarly partnered with local firms to navigate the Chinese market. This strategy has previously led to improved growth metrics for those companies.
-The Invesco S&P 500 Equal Weight ETF fell 0.8% last week, indicating more resilience among typical stocks compared to larger ones. The equal-weight index has underperformed the cap-weighted index by 7.4 percentage points in 2025 but trades at 16.7 times expected earnings, a 26% discount compared to the S&P 500's 22.6. The equal-weight index is projected to see 5% sales growth in 2026, leading to an 11% earnings growth. Despite ongoing economic challenges, including a government shutdown and weak jobs data, expectations remain high for continued earnings growth. The Financial Select Sector SPDR ETF was stable last week and trades under 16 times earnings, with banks facing positive trends from loan demand and mergers, while insurers might benefit from job growth and AI cost management improvements.
Features:
-Corning is constructing a unique solar energy plant in Michigan, its largest US operation, surpassing its Kentucky factory for iPhone glass production. This facility, producing thin silicon wafers critical for solar panels, aims to revive US manufacturing in this sector, which has been dominated by China for years. Corning's CEO, Wendell Weeks, envisions solar as a potential $2.5B business line, seeking to capture 15% of the domestic wafer market. However, solar manufacturing poses significant risks, as evidenced by the failures of US companies competing with China, especially following the elimination of solar subsidies and increased challenges for the solar industry under recent political decisions. Weeks remains optimistic yet acknowledges the challenges ahead.
-The revenue generated from tariffs has been crucial for reducing the federal deficit, which is projected to decline to 5.9% of GDP. Treasury Secretary Scott Bessent stated that reduced spending may lead to lower inflation, prompting potential interest rate cuts by the Fed. However, concerns have arisen about a Supreme Court ruling that could invalidate tariffs and jeopardize this revenue stream. While some analysts believe the ruling may overstress the situation, it could prompt the administration to pursue alternative tariffs. Nonetheless, this strategy may weaken negotiations with other countries and affect future investments in the U.S. Additionally, political challenges loom as the Senate has passed a resolution to end the emergency justifications for some tariffs, symbolizing the limits of Trump's power in Congress.
Europe:
-Breaking up with China presents challenges for Europe amid the U.S.-China trade tensions, exemplified by Nexperia, a Dutch auto microchip manufacturer acquired by the Chinese conglomerate Wingtech Technology. Nexperia produces essential microchips for modern vehicles and was heavily integrated into the Chinese supply chain. Tensions escalated when the Biden administration added Wingtech to its "entities list," requiring U.S. firms to obtain licenses for dealings. Further complicating matters, the Dutch government invoked the 1952 Availability of Goods Act to take control of Nexperia’s management, leading to claims of forced expropriation.
Emerging Markets:
-No update
Commodities:
-Breaking up with China presents challenges for Europe amid the U.S.-China trade tensions, exemplified by Nexperia, a Dutch auto microchip manufacturer acquired by the Chinese conglomerate Wingtech Technology. Nexperia produces essential microchips for modern vehicles and was heavily integrated into the Chinese supply chain. Tensions escalated when the Biden administration added Wingtech to its "entities list," requiring U.S. firms to obtain licenses for dealings. Further complicating matters, the Dutch government invoked the 1952 Availability of Goods Act to take control of Nexperia’s management, leading to claims of forced expropriation.
Streetwise:
-During the latest earnings season, US publicly traded companies have reported unexpectedly strong performance, with fourth-quarter expected earnings growth tracking at 13%, despite initial analyst forecasts dropping from 13% to 8%. Some contributing factors include lower-than-expected impact from tariffs and a weak dollar potentially boosting earnings. The focus remains on significant investments in technology by major companies, with capital expenditures for Microsoft, Amazon, Alphabet, and Meta projected to rise to $356B, outpacing the rest of the S&P 500. While earnings beats have led to slight gains, the market reacts harshly to misses, especially given the S&P 500's high valuation of 25 times earnings. Upcoming reports from major companies like Disney, Nvidia, and Walmart are also anticipated.

The Information : The Dumbest AI Fear

Many fears about artificial intelligence have at least some validity. I do worry how it exacerbates geopolitical tensions. I worry it may quietly weave existing biases and prejudices into different parts of life. I worry ChatGPT, an inveterate fibber, may have a better handle on the concepts of honesty and straightforward communication than many OpenAI executives.

But another AI concern keeps resurfacing, and it’s driving me nuts, and I wish people would let it go: that AI will ruin the art form of advertising.

Take the brouhaha over Coke’s latest AI Christmas ads. Hating on Coca-Cola is turning into a veritable holiday tradition, quite like eggnog and frantic travel. Recall that a similar uproar arose when the company did the same thing a year ago.

Look, they’re ads. By their basic nature, they exist as one of the most naked forms of capitalism: They’re as pure an expression of that medium as an Alpine lake. I see absolutely nothing wrong with the melding of two capitalistic forces, while I acknowledge that one has been around long enough to fool people into thinking it’s a high-minded power, and the other is so new as to inspire a reflexive sort of panic.

I think anyone in advertising who’s not using AI to some degree is foolish: Cozying up with Google’s Veo to develop the next Depends ad doesn’t jeopardize any Oscar dreams. (It might lower costs and boost some profits—core principles of capitalism—though so far we don’t quite know to what extent.) And I think it’s just astonishing that anyone is still willing to get annoyed with companies such as Coca-Cola for commissioning commercials made with AI.

This year, Coca-Cola released two ads for its “Holidays Are Coming” campaign, one of which was made by Secret Level, a San Francisco–based creative and animation studio with clients throughout media and entertainment. Jason Zada, a longtime Mad Man, founded the company in 2023 and worked on an AI Christmas ad for Coke last year, too.

Since AI video technology has improved significantly over the past year, Zada believes few people would’ve realized Secret Level’s latest spot used AI if Coke hadn’t been so forthright about it. Earlier, Coke screened the ad with focus groups. “And when they tested the ad, it tested very, very well,” Zada said. “When you tell people, ‘Hey, it’s AI,’ there’s this negative reaction to it because of whatever preconceived notion that people have of AI.”

Speaking generously, I’d describe Secret Level’s 78-second ad as “cute enough.” It bounces around the world to different cities, with local creatures eagerly awaiting the dawn of the holiday season: scarf-clad sea lions in San Francisco, koalas in thick jackets in Australia. You get it—I need not go on. As I said: It’s as unextraordinary as 99.98% of all ads. (And as my Australia-born colleague Martin Peers pointed out, it’s kinda dumb, too: Christmas falls in the summer Down Under. Why do the koalas need jackets?)

When I spoke with Zada, he made sure to point out a particular fact: Secret Level’s ads always involve some combination of AI and traditional digital software, and most originate with human-made sketches, though he wouldn’t describe the exact breakdown of how much of each was used in the Coke ad. Assembling the sea lions and koalas took about a month. Without AI, it would’ve taken more like three months—and possibly as long as half a year, he said.

Zada maintains another belief that AI opponents will consider as softheaded as actually expecting Santa to show up. He thinks AI will save Hollywood and Madison Avenue so much money, they’ll fund many more projects than in the past, including many artistic ones. (The counterargument: Sure, we get more projects, but they’re all of diminished value, since by stoking AI, we let slop culture proliferate. Which, all right, maybe!)

“Personally, I think we’re going to see, like, a renaissance of indie filmmaking,” he said. “If a normal animated feature takes at least $60 million to make, and we could make one for $20 million, we’ll make a lot more movies.”

Zada went on. “Hopefully, we can just create more content. I mean, that’s what everybody wants.” Uh-huh.

FT : Corporate America posts best earnings in 4 years despite tariffs

Corporate America posts best earnings in 4 years despite tariffs
Companies defy warnings about impact of Trump trade war to beat forecasts at one of highest rates on record

US companies’ earnings are growing at the fastest pace in four years, defying predictions that President Donald Trump’s trade war would trigger a slowdown across corporate America.

Median earnings growth year-on-year across the Russell 3000 index — a benchmark for the entire US stock market — hit 11 per cent in the third quarter, up from 6 per cent in the previous three months, according to Morgan Stanley. That is the fastest growth rate since the third quarter of 2021.

Six of the 11 sectors that make up the blue-chip S&P 500 index have reported positive average earnings growth in the three months to September, according to Deutsche Bank analysts, up from just two — financials and megacap technology stocks — between April and June. 

The buoyant growth comes despite warnings earlier this year from executives that Trump’s sweeping tariffs would push up costs, hit supply chains and pose a threat to economic growth.

“Companies have found ways to absorb the tariff impact and consumers will keep spending so long as they have a job,” said Dec Mullarkey, managing director at SLC Management, which runs $300bn in assets. 

Goldman Sachs equity strategist David Kostin said the vast majority of S&P 500 companies have reported their third quarter figures and results so far are above analysts’ consensus forecasts and one of the highest rates on record. 

“In our 25-year data history, this frequency of earnings surprises has been surpassed only during the Covid reopening period in 2020-2021,” he wrote in a note to clients this week.

Analysts expect earnings to grow by 7.5 per cent in the fourth quarter, according to data provider FactSet.



Corporate sentiment has been helped by trade deals with Japan and the EU, while last month Trump and Chinese leader Xi Jinping agreed a one-year trade truce.

Carmakers Ford and General Motors have said they expect a smaller tariff hit as a result of the Trump administration’s extended relief measures for imported car parts.

Power companies, real estate groups and industrials are also recording strong sales growth and expanding margins. NRG Energy benefited from data centre construction and improving travel demand boosted Southwest Airlines.

Banks including Goldman Sachs, Citigroup and JPMorgan Chase have posted bumper profits, helped by a resurgence of dealmaking activity and strong trading income thanks to financial market volatility.

Despite Meta disappointing the market with hefty capital expenditure plans, Big Tech groups such as Alphabet, helped by Google’s search and advertising business, and Microsoft posted results that topped analysts’ estimates.

However, warnings from some consumer-facing companies suggest many Americans may be struggling, say analysts.

The chief executive of packaged foods group Kraft Heinz flagged consumer sentiment going into the Christmas period as “one of the worst” in decades, while hamburger chain McDonald’s said customers had been pulling back from its more expensive offerings.

Companies selling goods rather than services “have been the clear laggards” this earnings season, said Deutsche analysts, with “consumer-facing companies” faring worse than those selling predominantly to other businesses.


The absence of official jobs data caused by the US government shutdown has added to investors’ uncertainty about the state of the labour market and the health of the consumer.

Alternative sources of data including the National Federation of Independent Business, the San Francisco Federal Reserve and state-level jobless claims show the jobs market “is still doing well”, said Torsten Sløk, chief economist at investment firm Apollo Global Management.

That is despite significant lay-offs by big companies recently, with at least 17 S&P 500 groups, including Amazon, UPS and Target, shedding roughly 80,000 jobs since the start of September, according to Goldman Sachs. 

The University of Michigan’s index of consumer sentiment fell to a three-year low in November. Falling confidence “was widespread throughout the population, seen across age, income and political affiliation”, said Joanne Hsu, the survey’s director.

There was “one key exception”, Hsu added — sentiment among consumers with large stock holdings rose 11 per cent.

Lisa Shalett, chief investment officer at Morgan Stanley Wealth Management, said a “widening chasm” between the haves and have-nots explained why consumer demand appeared resilient despite the weakening labour market.

The top 40 per cent of households by income “control nearly 85 per cent of America’s wealth, two-thirds of which is directly tied to the stock market, which has climbed more than 90 per cent in three years”, she said.

As a result, “forecasting the labour market may increasingly be less important than forecasting the direction of the stock market itself in order to understand consumption levels”.

WSJ : Elon Musk Has One Trillion Reasons to Finish His Robot Story

Elon Musk Has One Trillion Reasons to Finish His Robot Story
The Tesla chief faces intense competition from rivals like Uber, even in the automaker’s hometown

Watching Elon Musk celebrate his $1 trillion pay package came with a bit of déjà vu.

Tesla TSLA -3.68%decrease; red down pointing triangle shareholders on Thursday overwhelmingly approved the 10-year comp plan that only pays out in total if he meets wildly ambitious goals that would effectively remake the electric-car company into a robot powerhouse. Shortly after, Musk declared something of a new era.

“It’s not just a new chapter for Tesla, it’s a new book and that new book is massively increasing vehicle production,” Musk told investors gathered at the company’s headquarters in Austin, Texas.

That’s almost—word for word—what he said roughly 18 months ago.

On that occasion, Musk was celebrating the last time shareholders approved a massive payday for him, which was later put on ice (again) by a Delaware judge.

Since then, Musk apparently came down with a kind of writer’s block. And like many authors I know, he spun his wheels complaining about his pay and procrastinating with other projects (xAI and politics).

As he stewed, Tesla’s rivals have been preparing for a robot future of their own. That future is turning out to be a much different story than the one Musk is writing.

Already in Austin, Uber Technologies UBER -0.14%decrease; red down pointing triangle is offering robotaxis through its ride-hailing service. The vehicles come from Alphabet’s Waymo, which has partnered with Uber UBER -0.14%decrease; red down pointing triangle for deployment in an increasing number of U.S. cities. (Waymo has its own ride-hailing app in other cities, such as San Francisco.)

The partnership was born out of the complicated realities of bridging the future with the present.

Years ago, Uber abandoned its troubled efforts to develop its own autonomous-car technology. It is now selling itself as the home for rivals to reach its vast army of users. In doing so, Uber aims to address one of the boring problems facing the industry: figuring out supply and demand for a still rather nascent technology.

While Musk is talking about churning out millions of robot cars, Uber is betting that a hybrid approach—a mix of robots and more typical human-driven cars—is the right formula in the years to come.

“These vehicles are expensive, and we need to make sure that they are utilized to the maximum possible, but also being able to manage through the peaks and troughs of demand that we see,” Sachin Kansal, Uber’s chief product officer, told me during Friday’s episode of the “Bold Names” podcast. “The number of vehicles that you need at say 8:30 a.m. on a weekday is very different than what you may need at 3 p.m. on that same day as well.”

In other words, when demand spikes, Uber can make sure it has enough human drivers to meet user needs that can’t be filled with robots alone.

But it isn’t just about making sure the robot cars are positioned in the city to optimize revenue. It’s about dealing with the nitty-gritty details of making sure the fleet is ready to be in service.

Uber is responsible for making sure the robot cars are maintained—somebody has to clean out the back seat and pick up the forgotten backpacks.

Many think of Uber as a platform of individually owned cars. In fact, as many as 20% of the vehicles are actually owned by fleets which, in turn, hire drivers. These companies might have just a handful of cars or thousands of vehicles.

Kansal’s team has built a lot of software for these fleets to help manage their operations. That has given Uber an understanding of when electric vehicles need to be charged or returned for maintenance—the sorts of insights needed for managing a fleet of robot cars.

He suggests his company is now positioned to be many people’s first taste of autonomous driving. “We saw the same thing happen with electric vehicles,” he said. “One in four Uber riders say that their first electric vehicle experience was on Uber.”

For many, an Uber was their first taste of a Tesla. After riders struggled to use Tesla’s doorhandles, for example, Uber launched an education campaign within its app showing how the push-and-pull opener worked.

So far, Musk has suggested he wants to go it alone with robotaxis. “Tesla has all of the ingredients necessary to offer a vast self-driving fleet, overnight,” Musk said earlier this year.

The electric-car maker’s own ride-hailing app will be populated by Tesla vehicles owned both by customers and by the company, he has said.

To address worries about the details of fleet management, Tesla has shown videos of wireless charging stations and special robot arms to clean vehicles—including sucking up forgotten backpacks.

But after years of talk, Tesla’s fully autonomous car fleet is still rather small in comparison. On Thursday, Tesla reaffirmed to shareholders that its robotaxis in Austin, after launching in June, will be able to finally operate without safety riders in the vehicles by year’s end—a step taken long ago by Waymo.

“So now that we believe we have…autonomy solved, or, at least, are within a few months of having unsupervised autonomy solved at a reliability level significantly better than human…it’s time to ramp up production,” Musk said.

Tesla aims to increase vehicle production by about 50% by the end of next year, hitting an annualized production rate of 2.6 million to 2.7 million, Musk said, then growing to rates of 4 million by the end of 2027 and 5 million a year after that.

Needless to say, if that happens, it would be an incredible chapter in Musk’s new book. But, if it feels a bit like déjà vu, we have heard similar aspirations from him before.

Now, he has one trillion reasons to finish the story.

WSJ : Apple’s iPhone Air Is a Marketing Win and a Sales Flop

Apple’s iPhone Air Is a Marketing Win and a Sales Flop
Early analysis shows tepid demand for Apple’s newest design, although some see the smartphone driving store traffic

  • The iPhone Air, Apple’s thinnest smartphone, accounted for only one in 10 iPhone 17 sales in early weeks, according to a consumer survey.
  • Apple took steps to scale back production of the Air shortly after its launch, according to people familiar with its supply chain. Some analysts see the Air as a success due to marketing buzz.
  • The iPhone Air’s design sacrifices camera quality, sound and battery life, and lacks features found in other iPhone 17 models, some of which are $200 cheaper.

Jason Purdy wanted to like his new iPhone Air.

Raised in Apple’s AAPL -0.48%decrease; red down pointing triangle hometown of Cupertino, Calif., and later an Apple senior product manager, Purdy said he loves to see innovative product design from tech companies. So he made an Apple store appointment to buy the new, ultrathin smartphone the day it went on sale.

Within a month, he returned it.

He found it hard to have speakerphone calls and listen to music. And the photos he took at his early October wedding came out noticeably worse than ones his brother took on a new iPhone 17 Pro.

“The performance wasn’t quite there. Across the board they’re sacrificing all these things,” said Purdy. The Air was very pleasurable to hold and impressed his friends, but didn’t work as his primary device, he said.

The Air is billed as Apple’s thinnest smartphone yet. Just one in 10 iPhone 17 buyers in the early weeks of sales opted for it, according to one consumer survey. Some users have complained online about the Air’s weaker camera, sound quality, battery and price tag. Other iPhone 17s have been back-ordered up to three weeks while the Air is available right away, according to Apple’s website.

Apple took steps to scale back production of the Air not long after the launch, according to people familiar with its supply chain.

The lukewarm reception for the Air is the only blemish on what is shaping up to be a blowout holiday quarter for Apple, thanks to more popular iPhone 17 models. It demonstrates Apple’s challenge in innovating around its flagship product and raises questions about whether Apple’s next form factor—a foldable iPhone—will resonate.

Android phone makers already offer foldable devices, but they are niche products thus far due to their high price and novel shape.

Apple has been hungry to find new ways to power sustainable growth for the iPhone. Unit volumes for the smartphone were stagnant from 2021 to 2024, according to research firm IDC. The Air is the company’s most innovative smartphone design since the iPhone X in 2017.

“Any time they do these nichey kinds of phones, they just don’t take off,” said Michael Levin of Consumer Intelligence Research Partners, referencing the iPhone “Plus” models that the Air replaced, as well as the discontinued iPhone Mini models from a few years ago.

The research firm’s consumer surveys found that 29% of U.S. iPhone buyers in the September quarter bought one of the new iPhone 17 models, a big uptick compared with last year when 20% of U.S. iPhone buyers bought a new iPhone 16. This year, there was great interest in the Pro and Pro Max models, the firm said, but the Air got little traction.

Some analysts said the Air represented a marketing win for the company and was also an important steppingstone for developing the architecture of a foldable iPhone, likely with two thin halves that open up to a large screen.

“The Air was a marketing hit rather than a sales hit,” said Nabila Popal, an analyst with research firm IDC. It “created a buzz around the launch that we haven’t seen in years.”

An Apple spokeswoman declined to comment. On Apple’s earnings call last week, Chief Executive Tim Cook said Apple is “thrilled with how iPhone’s been received.”

An engineering marvel, the iPhone Air is roughly the thickness of a winter wetsuit yet packs faster computing power than Intel’s desktop Mac chips from just a few years ago.

To shrink the device, Apple compromised on features. The Air has one speaker at the top of the device, so videos lack the surround-sound quality of other iPhones that have speakers at both ends.

Its single rear camera lacks the telephoto lens of the Pro models and the ultrawide lens in the entry-level iPhone 17, which costs $200 less. The cheaper device also comes with a longer-lasting battery and two speakers.

Apple set the Air’s price $100 higher than the 16-Plus model it replaced, potentially boosting profit margins and offsetting tariff costs. But the price tag appears to be an issue for some buyers.

In China, the Air’s price is about $280 higher than that of the entry-level iPhone 17, too expensive to qualify for a major government subsidy program intended to boost consumer spending. The cheaper model qualifies, helping to make it a sales hit in China early on.

Demand for the Air has missed expectations, said Ming-Chi Kuo, an analyst at TF International Securities who tracks Apple’s supply chain. He predicts an 80% production capacity cut by early next year.

News Corp, owner of The Wall Street Journal, has a commercial agreement to supply news through Apple services.