The daily download on the business of technology.
The Facebook juggernaut continues, Samsung is printing money despite its many woes, and just as many CEOs pride themselves on being their company’s chief product officer or the top dog on marketing, Donald Trump is proving to be a very fine commerce secretary.
Contract manufacturer Foxconn boldly announced plans to build a TV panel factory somewhere in southern Wisconsin and to invest $10 billion in the effort. Foxconn’s leader Terry Gou met three times with the President of the United States to seal this deal, said to account initially for 3,000 jobs. Foxconn has a history of vaporware factory announcements, so Wisconsinites ought not get too excited just yet. (The Washington Post has a nice overview of the history—and the potential complications.) As well, the state of Wisconsin will offer $3 billion in tax breaks, meaning its taxpayers will be paying a cool million dollars per job.
Still, if Foxconn follows through, it is a huge win for an administration that has hectored foreign and U.S. manufacturers alike to build their wares here. This is, after all, what a bully pulpit is for, and this President is using it. Next week, when Apple reports earnings, it is certain to be asked if it is building three “beautiful” factories as Trump has pre-announced on Apple’s behalf. Three factories, incidentally, would increase the number of factories Apple owns by a factor of four. Stranger things have happened.
Thanks to the readers who responded to my praise for a new biography of information-age pioneer Claude Shannon with two additional book recommendations. Shannon plays a big role in The Information: A History, A Theory, A Flood, by journalist James Gleick. Another reader pick is A Man for All Markets: From Las Vegas to Wall Street, How I Beat the Dealer and the Market, by Edward O. Thorp, in which Shannon also figures prominently.
For my time away from work I prefer fiction to math. I’m taking two novels along with me on vacation, which will take me away from Data Sheet until Aug. 7. If they’re any good I’ll tell you about them when I’m back.
Happy summertime to all.
Tale of the tape. It’s the single busiest day of earnings season, if that’s your thing. As Adam mentioned, Facebook pleased investors last night with a 45% revenue increase and a 71% profit jump. After saying earlier this year that it was running out of places to stick ads, the social networking giant said higher ad prices helped, as did experiments with ads in Instagram Stories and other videos. Coming soon: Ads in Messenger. Facebook shares, already up 44% so far this year, tacked on another 8% in premarket trading on Thursday, pushing the company’s stock market value above $500 billion for the first time.
Hit to my wallet. Around the rest of the tech world on Wall Street, PayPal offered the slight delight of an 18% revenue jump. Its stock has also been hot, up almost 50% this year, and it gained another 3% on Thursday. Transaction volume using my kids’ favorite app, Venmo, doubled from last year to $8 billion, PayPal said. My wife and I remain just as asterisk in the total, but growing fast.
Zero growth. At Twitter, the news was disappointing. Sales declined 5% to $574 million and the company had no growth in monthly active users over the past three months. Its shares lost about half of the entire year’s gain, trading down 10%.
IMing for dollars. Away from the public markets, work messaging app Slack is raising $250 million in private backing that will value the company at about $5 billion, up from $3.8 billion when it last raised money in April, 2016, Bloomberg reported. CEO Stewart Butterfield has resisted calls to go public or sell out to a bigger company.
Bad idea. Tech leaders ranging from Apple CEO Tim Cook to Intel CEO Brian Krzanich to Twitter CEO Jack Dorsey criticized President Donald Trump’s new ban on allowing transgender people to serve in the military. “We are indebted to all who serve. Discrimination against anyone holds everyone back. #LetThemServe,” Cook tweeted.
Gotcha. The man thought to be behind BTC-e, an anonymous digital money exchange, has been arrested and will be charged with laundering at least $4 billion via bitcoin. Police caught Russian Alexander Vinnik in a small beachside village in northern Greece and will likely extradite him to the United States to stand trial. BTC-e has been offline since Tuesday.
Better sound. Hearing impaired people with Cochlear implants will be able to get audio streamed directly from Apple iPhones without the need for an intermediary add-on device, the company announced on Wednesday. “It’s the first time people with an iPhone will be able to pick up the phone normally, or just listen to music, without any additional devices,” Jan Janssen, senior vice president of research and development at Cochlear, told Reuters.
FOOD FOR THOUGHT
Bringing untold dystopian scenarios closer to reality, U.S. scientists have edited the DNA of a human embryo for the first time, the magazine Technology Review reported on its web site on Wednesday. Led by Shoukhrat Mitalipov at Oregon Health and Science University, the team used the gene editing technology known as CRISPR to alter the code of one-cell embryos, the magazine said.
Earlier research by Chinese scientists concluded that the use of CRISPR introduced errors into the cells and the intended DNA changes were not successfully adopted in every cell. But the U.S. effort may have had greater success, as one “scientist familiar with project” said:
IN CASE YOU MISSED IT
Why AMD’s Stock Hit a 10-Year High by Aaron Pressman
Meg Whitman Steps Down From HP Inc’s Board by Jonathan Vanian
Microsoft Joins Everyone But Amazon In Cloud Foundation by Barb Darrow
The SEC’s Big Digital Coin Ruling: What It Means by Jeff John Roberts
Amazon Is Going on a Hiring Spree to Recruit 50,000 Workers by Jonathan Vanian
BEFORE YOU GO
Birkenstock sandals are famed for their comfort and the hippy vibe they impart. But the company’s chief executive, David Kahan, was anything but mellow when he warned his dealer network recently about selling online via Amazon.com. Birkenstock stopped selling directly on Amazon earlier this year, citing concerns about listings of counterfeit footwear. In an email obtained by the Washington Post (subscription required), Kahan warned his resellers not to sell on Amazon either: