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CEO Daily: Thursday, February 25

While you were sleeping, ailing Japanese electronics firm Sharp agreed to a takeover by Taiwan’s Foxconn – also known as Hon Hai Precision Industry – solidifying the Taiwanese firm's position as Apple’s biggest supplier. The deal involved issuance of $4.4 billion worth of new shares to Foxconn, causing Sharp stock to tumble on fears of dilution. But late in the Asian day, Foxconn said it had received new information from Sharp which would need to be clarified before the deal could be done. Stay tuned. A purchase of Sharp, founded in 1912, would be a rare foreign breach into Japan’s still-insular business world.

Meanwhile, the Chinese stock market tumbled six percent – a unpleasant development before Friday’s meeting of the G-20 finance ministers and central bankers in Shanghai. The IMF called on the ministers to take coordinated action to combat a global economic slowdown.

Here at home, the Republican political establishment, and everyone else, is trying to adjust to the notion that Donald Trump will be the GOP presidential nominee – an outcome party leaders and pundits insisted for months couldn’t happen. Rubio, Cruz and Kasich are all hoping that victories in their home states of Florida, Texas and Ohio will give them a path to victory. But no sign yet that any of them is gaining the momentum needed to displace Trump.

As a sober reminder of what’s at stake, the Miller Center releases a study this morning showing how eight of the past Presidents have faced major financial crises in the first year of their presidency. Not predicting, just saying.

More news below.

Alan Murray
@alansmurray
alan.murray@fortune.com

Top News

Apple wants iPhone to be more secure

As Apple continues to fight the FBI on its request to help to hack into an iPhone belonging to one of the San Berardino, Calif., shooters, the tech giant is also reportedly working on measures to make such a request more difficult to fulfill in the future. First reported by The New York Times, citing sources familiar with the matter, Apple is working on new security measures that would make it "impossible" for the government to hack into a locked iPhone using methods currently at the center of the company's battle with the FBI. If it succeeds, it would likely set off more legal and security battles in the future. Fortune

Ackman's poor start to 2016

Billionaire investor William Ackman has managed to erase his entire 40% return of 2014, a performance that put him at the pinnacle of the hedge fund world. His Pershing Square Holdings portfolio has lost 17.3% so far in 2016, the fund told investors on Wednesday. When you combine that with the 20.5% drop in 2015 in a relatively flat year for markets, the fund's declines are now greater than its 2014 gain. Valeant Pharmaceuticals, which has been part of Ackman's portfolio for only a year, has been the fund's main loser. Reuters

HP Inc. to accelerate layoffs

HP, Inc. executives told analysts that nearly 3,000 workers would leave the company by the end of the year, an acceleration from an original layoff plan first announced last year that would have spread out the job cuts across a three-year period. A tough market altered HP's plans, CEO Dion Weisler said. The recently spun off maker of printers and PCs said its fiscal first quarter revenue fell 12% year over year to $12.2 billion. The layoffs are projected to save the company roughly $300 million by the beginning of 2017. Fortune

Terrorists make threats against tech CEOs

A video purportedly made by supporters of the Islamic State makes direct threats against Facebook CEO Mark Zuckerberg and Twitter CEO Jack Dorsey for combating terrorism on their Internet platforms. The 25-minute propaganda video shows hackers changing profile accounts and posting Islamic State propaganda. They allege they hacked more than 10,000 Facebook accounts and over 5,000 Twitter profiles. The extremist group says it's responding to growing efforts by the social networks to suspend accounts and remove posts that those services say incite violence and promote terrorism. USA Today

Around the Water Cooler

2016's biggest IPO is....

This year’s IPOs have raised $886 million, or roughly 20% of the $4.7 billion that was raised in the first two months of last year. That isn't the ideal market for a company to launch its initial public offering, though Silver Run Acquisition Corp is making a go of it anyway. The firm doesn't have any earnings, sales, or an actually business yet. It is a so-called blank-check company, which plans to use the money it raises to buy up companies or assets in the beaten down oil and gas sector. Silver Run doesn't have any targets yet, though it is run by Mark Papa, the former CEO of EOG Resources. Fortune

Restoration Hardware: Rich are pulling back

Restoration Hardware's shares plunged as much as 23% on Wednesday after the retailer reported preliminary fourth-quarter financial results that fell well short of investor expectations. CEO Gary Friedman blamed everything from the oil bust to the crazy stock market for the high-end furniture retailer’s shortfall. He added that customers were less receptive to promotions during the holiday quarter, something he suggested reflected a pull-back in high-end shoppers. Notably, Restoration Hardware said that with each successive quarter last year, weak sales in Canada and Texas – two big oil markets – were a growing drag on the overall business. Fortune

Electric cars fleet expected to surge

Electric cars cold account for over a third of the new cars sold globally by 2040, according to a new report from Bloomberg New Energy Finance. The report predicted that falling battery costs will help lift sales, as well as government incentive policies in the U.S., China and Europe. It can be hard for us to imagine that magnitude of an electric car fleet today, as rock bottom oil prices have slowed sales for that segment of the industry. Fortune

Home Depot, Lowe's win the holidays

Home-improvement retailers were the big winners during the holiday season, as each reported sales growth that far exceeded other big-box retailers for the key spending season. Home Depot and Lowe's don't count on the holidays like Walmart and Target do, but that hasn't stopped them from reporting sharply higher sales as consumers increasingly invest in their homes. A recovering housing market, as well as constrained supply, has led to home price appreciation. When home prices are higher, consumers are more willing to invest in their properties. A warm winter also led to increased spending for lumber and outdoor garden items. Fortune

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