Microsoft (NASDAQ: MSFT) reported second-quarter revenue of $81.3 billion, surpassing Wall Street expectations, with Azure cloud services jumping 39% and Microsoft Cloud crossing the $50 billion quarterly revenue milestone for the first time.

Operating income hit $38.3 billion, up 21% year-over-year, while non-GAAP earnings per share reached $4.14, growing 24% and reflecting solid underlying business momentum beneath headline numbers inflated by investment gains.

CEO Satya Nadella captured the strategic significance:

We are only at the beginning phases of AI diffusion and already Microsoft has built an AI business that is larger than some of our biggest franchises.

The earnings beat masked an important distinction.

Reported net income of $38.5 billion and earnings per share of $5.16 jumped 60% year-over-year, an eye-catching number that obscured a $7.6 billion accounting gain from Microsoft’s investment in OpenAI.

The non-GAAP earnings per share of $4.14 rose 24%, indicating solid mid-twenties operational growth.​

Azure and cloud: Where AI monetization is happening

The real story lives in Azure. The cloud-computing unit grew 39%, beating the 36 to 38% consensus forecast and extending Microsoft’s three-quarter streak of acceleration.

This marks the highest Azure growth rate since the company went aggressive on AI infrastructure, and it reflects demand from enterprises racing to deploy machine-learning models and AI workloads at scale.​

Microsoft’s broader cloud business, which bundles Azure, Microsoft 365 subscriptions, LinkedIn, and Dynamics software, crossed $51.5 billion in quarterly revenue, up 26% year-over-year.

More tellingly, the company’s backlog of contracts not yet recognized as revenue exploded to $625 billion, up 110% from a year earlier.

That figure includes a $250 billion commitment from OpenAI to purchase Azure computing services and a separate $30 billion deal with Anthropic.

These multi-year commitments provide Microsoft with revenue visibility stretching years into the future, reducing forecast risk.​

CFO Amy Hood emphasized the point:

Microsoft Cloud revenue crossed $50 billion this quarter, reflecting the strong demand for our portfolio of services.

But beneath the headline was an admission: capacity constraints continue to limit growth.

Azure remains supply-constrained, meaning demand for cloud computing outpaces Microsoft’s ability to deliver, a rare and valuable market position.​

Microsoft Q2 earnings: Investing for growth

Microsoft’s second-quarter capital expenditures hit $29.9 billion, roughly double the prior-year quarter.

The company is on pace to exceed $100 billion in annual capex, a staggering investment justified by the undersupply of AI-capable infrastructure.

Operating margin still expanded to 47%, showing that revenue growth is outpacing spending growth.

The leverage dynamic works both ways. Heavy spending today limits near-term earnings growth.

But once data center capacity comes online and utilization normalizes, the combination of high cloud margins (Azure operates at roughly 42% operating margin) and high volumes could expand profitability significantly.

With a commercial backlog of $625 billion and Azure still constrained, Microsoft has rare visibility into future growth.

The post Microsoft beats Q2 earnings as Azure jumps 39% and cloud revenue tops $50B appeared first on Invezz

Meta Platforms (NASDAQ: META) is inching higher in extended hours after the tech titan posted its Q4 earnings that handily topped Street estimates on the back of strong AI tailwinds.

The multinational earned $8.88 on a per-share basis on $59.89 billion revenue – well above $8.23 a share and $58.59 billion that analysts had called for.

At the time of writing, Meta Platforms stock is down more than 12% versus its 52-week high.

Should you invest in Meta stock after Q4 earnings?

According to Meta Platforms, the total number of daily active users across its family of apps stood at 3.58 billion in the fourth quarter – essentially in line with Street estimates.

In terms of capital expenditures, Susan Li, the firm’s chief of finance, guided for up to $135 billion, nearly double what it spent last year, signalling plans to continue investing rather aggressively on the AI buildout.

Such an increase in CAPEX could compress Meta’s operating margin by nearly 5.0% this year, as per Wall Street estimates.

But Brent Thill – a senior Jefferies analyst – believes “peak pressure” is already baked into META stock following recent weakness.

In a pre-earnings research note, he recommended that long-term investors stick with the Nasdaq-listed firm as its upside outweighs risks in 2026.

How high could META shares fly in 2026?

While Meta Platforms is set to spend billions on AI this year, it has recently reduced budget for its metaverse unit, which Thill dubbed a “positive sign” indicating cost discipline in his latest report.  

The Jefferies analyst agreed that the company’s Llama 4 model didn’t fare well with rivals – but said its new text and image AI models scheduled for the first half of 2026 will change the narrative.

The upcoming offerings will confirm Meta’s investments including on AI talent are paying off, he added.

Thill maintains a “buy” rating on Meta shares with a price objective of $910 – indicating potential upside of roughly 30% from current levels.

Meta Platforms offered upbeat guidance today

META stock appears attractive as a long-term holding also because the titan issued solid guidance for its current quarter. In Q1, it sees sales coming in at $55 billion, well above the Street at $51.41 billion.

The Nasdaq-listed firm continues to tap on AI to optimize ad performance and boost engagement across its platforms. Yet, it’s currently trading at a steep discount to rival Alphabet Inc.

Meta shares are currently going for about 21x forward earnings versus more than 28x for GOOGL. That’s a much bigger discount than “historical norms” – Jefferies’ Brent Thill told clients.

All in all, the company’s “top-line strength and continued efficiency gains” can offset the increase in operational expenses, which makes its stock worth owning in 2026, he concluded.

The post Meta stock dubbed cheap by ‘historic norms’ as Q4 earnings beat estimates appeared first on Invezz

The Hang Seng Index continued its strong bull run on Thursday as investors cheered the new developments in China, where officials are considering measures to boost the property market. It jumped to a high of H$27,870, its highest level since July 2021, and 90% from the 2022 low.

China to Ease the “Three Red Lines” policy

One major catalyst for the ongoing Hang Seng Index rally is a report that Beijing was considering ending the Three Red Lines policy that led to the collapse of companies like Evergrande, Country Garden, Kaisa, and Fantasia Holdings.

According to Bloomberg, developers are no longer required to submit metrics designed to rein in their debt buildup. The three red lines forced companies to submit data on the liability-to-asset ratio, net gearing ratio, and cash-to-short-term debt ratio.

Developers are required to have a liability-to-asset ratio of less than 70%, net gearing ratio of less than 100%, and a cash-to-short-term debt ratio of at least 1. These measures were introduced to ensure China’s real estate sector was healthy.

As a result, property stocks were among the top gainers on Thursday. Longfor Group stock jumped by over 5%, while China Overseas Land, China Resources Land, and Henderson Land stocks jumped by over 4.5%.

The ongoing rally also helped to lift copper to a record high as investors anticipated renewed demand from Chinese developers.

Casino stocks slump after weak Macau results 

The rally in the property sector was offset by a big decline in casino stocks. Sands stock plunged by 7.38%, while Galaxy Entertainment fell by 3.50%.

The crash happened after Las Vegas Sands published weak financial results, which it attributed to its Macau operations. Its EBITDA from Macau came in at $608 million, lower than the median estimate of $628 million. Also, the adjusted profit margin dropped to 28.29%, the lowest level in a decade.

The main reason for this is the rising competition in Macau, which is squeezing margins as companies pivot away from high rollers towards mass market gamers. Also, China has continued to crack down on VIP bettors.

The Hang Seng Index jumped after the Federal Reserve delivered its interest rate decision, which was in line with what analysts were expecting. 

Hang Seng Index technical analysis 

HSI stock chart | Source: TradingView

The weekly timeframe chart shows that the Hang Seng Index has rebounded in the past few years. It jumped from a low of $14,825 in January 2024 to the current $28,000.

The index has moved above the key resistance level at $27,165, invalidating the forming double-top pattern, a common bearish reversal sign. 

It has remained above the 50-week and 100-week Exponential Moving Averages (EMA), a sign that bulls remain in control. The index has remained above the Supertrend indicator.

Therefore, the most likely scenario is where the index will likely continue rising as bulls target the next key resistance level at $30,000. A drop below the key support level at $27,164 will invalidate the bullish outlook.

The post Here’s what’s driving the Hang Seng Index rally today appeared first on Invezz

British car, van, truck, and bus production fell to its lowest level since 1952 in 2025, underscoring what industry leaders have described as the most challenging period for UK manufacturing in decades.

According to data from the Society of Motor Manufacturers and Traders (SMMT), total vehicle output dropped 15.5% year on year to 764,715 units.

Of these, 717,371 were cars, around 60,000 fewer than in 2024.

By comparison, UK car production stood at about 1.7 million in 2016.

SMMT chief Mike Hawes called it “the toughest year in a generation” and said hitting the government’s 2035 ambition of 1.3 million vehicles will likely require a new factory.

The industry group expects a recovery as new electric models launch, but warned that policy shifts in Brussels and tariffs in the US are adding pressure.

A three-day visit to China by Keir Starmer and UK business leaders has created hopes for potential inward investment in the UK.

Output slumps after a bruising year

Commercial vehicle output fell 62% to 47,344 after the closure of Vauxhall’s Luton plant in late March, with parent Stellantis consolidating van production at Ellesmere Port.

A major cyberattack at Jaguar Land Rover forced the company to shut down computer systems in early September, halting production for more than a month and taking additional time to return to normal output levels.

Beyond these events, longer-term headwinds include uncertainty over Brexit arrangements, the closure of Honda’s Swindon factory in 2021, the impact of the Covid-19 pandemic, and persistent global supply chain disruption.

With roughly 78% of UK-built cars destined for export, the industry also remains highly exposed to trade policy shifts.

US President Donald Trump’s announcement in April of new tariffs on car imports prompted some manufacturers to curb shipments, even though a later deal removed the threat of higher levies.

The basic tariff on UK car exports to the US still rose from 2.5% to 10%, dampening sales.

Investment needs and European trade risks

The government’s longer-term ambition is to raise production to 1.3 million vehicles a year by 2035.

Hawes cast doubt on that target without major new investment, saying: “To get to 1.3 [million] you kind of need a new plant.”

He suggested Chinese manufacturers are the most likely source of such investment, noting: “In terms of who is expanding their production globally, obviously it’s the Chinese.”

Starmer arrived in Beijing and Shanghai on Wednesday with a delegation that included executives from Jaguar Land Rover, McLaren, and Octopus Energy.

Chinese brands are gaining traction in the UK.

They accounted for 9.7% of new car sales in 2025, nearly doubling their market share in a year as MG, BYD, and Chery expanded.

The UK has not imposed tariffs on Chinese imports, unlike the US or the EU.

Chery said last year that it was “actively considering” building a UK plant as part of its localisation strategy.

At the same time, Hawes warned of growing risks from Europe, pointing to what he described as an increasingly protectionist “Made in Europe” approach.

“Unless the UK can be seen as part of that, these proposals could have the effect of delivering what Brexit didn’t deliver – and that’s making it much harder for UK produced vehicles to access the European market,” he said. “So this is a significant threat.”

EV transition and hopes for recovery

Despite the weak backdrop, the SMMT expects conditions to improve in 2026 as production of new electric models gathers pace.

Hawes said there is a “pathway” to lifting combined car and van production above 1 million units a year by 2027, a target he described as “optimistic but realistic.”

Car output is forecast to rise by about 10% this year, supported by new model launches.

Nissan’s latest electric Leaf began rolling out of its Sunderland factory in mid-December, while Jaguar Land Rover is preparing to produce a new electric Range Rover and the first models in a new generation of electric Jaguars at its Solihull plant later this year.

The post UK vehicle output hits lowest level since 1952 as industry pins hope on EV appeared first on Invezz

OpenAI, the creator of ChatGPT, is on track to raise billions of dollars from its existing and new investors, a sign that the artificial intelligence (AI) boom is accelerating.

OpenAI to raise billions as competition rises 

The latest reporting by The Information shows that the company is about to raise as much as $100 billion in the coming weeks.

NVIDIA, an existing investor, plans to provide up to $30 billion in the company using the windfall it has received during the ongoing AI boom.

Microsoft, which kick-started its investment in the company, will contribute about $10 billion, while Amazon plans to invest between $10 billion and $20 billion in the company.

Amazon’s deal is structured differently from the others. For one, it is contingent on the company using Amazon’s chips and also use its cloud for about 7 years.

At the same time, Masayoshi Son’s Softbank also plans to invest $60 billion in the company, a year after it provided it with over $40 billion in financing. It is also working with Middle East investors, who are expected to provide as much as $50 billion to the company.

The new fundraising means that the company has now raised billions of dollars in financing, making it the second-biggest private company in the world with a valuation of over $750 billion.

Most importantly, the funding will help the company to cover the rising cash burn, which is estimated to have reached $9 billion in 2025. It will also help the company to fulfill part of its spending plans, including its deals with companies like Broadcom, Oracle, and CoreWeave.

The funding comes as the company is preparing to go public either this year or in the coming year. It will likely wait for the much-anticipated Anthropic IPO to gauge interest among institutional and retail investors.

Anthropic, the creator of Claude, plans to launch its IPO later this year, a move that will value it at over $350 billion. The IPO will provide investors with more information about its business, number of users, and its revenue growth.

OpenAI is facing substantial competition 

The new OpenAI funding comes as the company continues to face substantial competition in the AI industry.

Most of this competition is coming from well -funded companies, with some of them receiving multi-billion dollar valuations. 

For example, Elon Musk’s xAI has received a valuation of over $250 billion, while Anthropic is now valued at over $350 billion. Its valuation has jumped after it released its recent model, which has been widely praised by corporate clients.

Google is also a major player in the industry, with its Gemini product having millions of users globally. Other large players in the industry are companies like Perplexity AI, DeepSeek, Mistral, Meta AI, and Jasper.

Estimates are that OpenAI made over $20 billion in revenue last year and lost billions of it in losses. The company is now working on diversifying its revenue by launching adverts on its platform.

The post OpenAI eyes billions in funding from tech giants Amazon, NVIDIA, Microsoft, Softbank appeared first on Invezz

Indonesian equities plunged further into turmoil on Thursday after a warning from MSCI Inc. over a possible market downgrade triggered the worst two-day selloff in almost three decades, rattling investor confidence across equities and currency markets.

The benchmark Jakarta Composite Index tumbled as much as 10%, after earlier triggering a 30-minute trading halt.

At the time of writing, the index was trading down 5.91%.

The move extended losses sparked by MSCI’s caution around market transparency and the limited amount of stock available for trading among listed companies.

Analysts downgraded their views in response, accelerating the decline.

MSCI warning fuels market rout

MSCI’s concerns center on Indonesia’s low free float, with many of the market’s largest companies tightly controlled by a small number of wealthy shareholders.

Investors argue that this structure distorts index representation and raises the risk of manipulation.

Following the warning, Goldman Sachs Group Inc. and UBS AG both cut their recommendations on Indonesian equities.

Goldman warned that more than $13 billion in outflows could be triggered in an extreme scenario if MSCI were to downgrade the market.

“The market needs a clearer plan from the regulators on what they’re going to do to reach a consensus with MSCI, and the plan must be communicated regularly so investors can keep track of it,” said Aldo Perkasa, head of research at PT Trimegah Sekuritas Indonesia in a Bloomberg report, adding the selloff showed that official explanations so far had failed to reassure investors.

Currency pressure and policy concerns

The turmoil spilled into foreign exchange markets, with the rupiah weakening as much as 0.5% against the dollar, its steepest fall since October and underperforming regional peers.

Exchange rules state that a further 30-minute trading halt would be triggered at a 15% decline.

If losses are sustained, Indonesian equities could enter a technical bear market.

The selloff has intensified scrutiny of Indonesia’s financial markets, once viewed as a flagship of the country’s economic rise.

Confidence has been shaken by an ambitious school lunch program that risks straining public finances, the abrupt departure of former finance minister Sri Mulyani Indrawati last year, and a widening fiscal deficit.

Foreign investors had already turned cautious before this week’s rout.

Net foreign selling totaled $192 million in the week ended Jan. 23, the first outflow in 16 weeks.

On Wednesday alone, overseas investors sold a net 6.2 trillion rupiah ($371 million) of shares, the most since April.

Free-float reforms under scrutiny

Regulators have pledged to improve transparency ahead of MSCI’s next review in May, when the index provider will reassess Indonesia’s market accessibility.

Failure to show progress could lead to a reduced weighting or even a downgrade from emerging market status.

Indonesia currently has the lowest free float among major Asia-Pacific markets at 7.5%.

Authorities aim to raise that to 10–15%, with a longer-term target of 25%, though no timeline has been set.

That compares with 25% thresholds in Hong Kong and India, and 15% in Thailand.

The latest selloff follows months of consultation after MSCI proposed tightening its definition of free float last year.

The firm considered using data from Indonesia Central Securities Depository, but said investors raised “significant concerns” about relying on that dataset.

“Based on what’s been disclosed so far, the discussion around KSEI has mainly been about concerns over aspects of its data methodology, but there hasn’t been enough detail to draw firm conclusions yet,” said Sufianti, a strategist at Bloomberg Intelligence.

“So for now, it’s very much a wait-and-see in terms of what actions might follow.”

The post Indonesian stocks slide to near bear market after MSCI downgrade warning appeared first on Invezz

On Thursday, global markets and geopolitics were shaped by a mix of accelerating artificial intelligence investment, volatile Asian equities, renewed UK-China diplomacy, and a powerful rally in commodities.

OpenAI funding signals acceleration in AI arms race

OpenAI, the creator of ChatGPT, is on track to raise tens of billions of dollars from existing and new investors, highlighting the pace at which the AI boom is intensifying.

According to reporting by The Information, the company could raise as much as $100 billion in the coming weeks.

Existing backers are expected to play a central role.

NVIDIA plans to invest up to $30 billion, drawing on the gains it has made during the AI-led surge in chip demand.

Microsoft, which spearheaded OpenAI’s early funding, is set to contribute about $10 billion, while Amazon is expected to invest between $10 billion and $20 billion.

Amazon’s investment is structured differently, with commitments tied to OpenAI using Amazon’s chips and cloud services for about seven years.

At the same time, SoftBank, led by Masayoshi Son, is planning to invest $60 billion, a year after providing more than $40 billion in financing.

Middle Eastern investors could add as much as $50 billion.

The funding would support OpenAI’s rising cash burn, estimated at $9 billion in 2025, and help finance major infrastructure deals with companies including Broadcom, Oracle, and CoreWeave.

The company is also preparing for a potential IPO this year or next, possibly after gauging investor appetite through the anticipated listing of Anthropic.

Asian markets jittery as AI capex collides with policy risk

Asian equities showed mixed performance.

South Korean stocks surged, with the Kospi up 1.09% on the day and 23% for January, while Taiwan’s market has gained nearly 13% this month.

Japan’s Nikkei edged higher, held back by currency volatility and rising bond yields.

Indonesia stood out on the downside. The Jakarta Composite Index suffered a second session of sharp losses after MSCI Inc. warned about ownership concentration and trading transparency.

Goldman Sachs cut its rating on Indonesian equities following the warning.

In the US, stock futures were subdued.

Microsoft shares slid 6.5% in extended trading amid concerns that its heavy AI-related capital expenditure may not deliver sufficient returns.

Meta Platforms, by contrast, raised its revenue and capex outlook for 2026, sending its shares up 6% after hours.

“A common theme so far from META and MSFT is the larger-than-expected capex spending, indicating the upward momentum for AI spending,” JPMorgan analysts said.

Starmer seeks reset in UK-China relations

UK Prime Minister Keir Starmer met Chinese President Xi Jinping in Beijing, marking the first visit by a British leader in eight years.

Starmer described engagement with China as a pragmatic choice, calling for a “mature” relationship with the world’s second-largest economy.

“I have long been clear that the UK and China need a long-term, consistent and comprehensive strategic partnership,” Starmer said.

He added that the two sides should “identify opportunities to collaborate, but also allow a meaningful dialogue on areas where we disagree”.

Xi stressed the importance of “dialogue and cooperation” amid a “complex and intertwined” global environment.

Starmer’s three-day trip includes meetings in Beijing and Shanghai and is accompanied by a delegation of nearly 50 UK businesses, including HSBC, British Airways, AstraZeneca, and GSK.

Copper surges as commodities rally broadens

Copper prices jumped to a record as base metals extended a strong start to 2026.

Three-month copper futures on the London Metal Exchange rose as much as 6.7% to $13,967 a ton, taking year-to-date gains to 12%.

Aluminum hovered near a four-year high, while zinc climbed almost 3%.

The rally has been fueled by expectations of stronger US growth, rising investment in data centers, robotics, and power infrastructure, and a weaker dollar.

“Under the cycle in which the US maintains interest rate cuts, the expectation for upward movement in copper prices has not changed,” said Chi Kai, chief investment officer at Shanghai Cosine Capital Management Partnership.

The surge in metals underscores how AI-driven investment, macro policy shifts, and geopolitics are increasingly intersecting across global markets.

The post Morning brief: OpenAI eyes massive funding as copper hits record highs appeared first on Invezz

Gold prices continued to surge to new record highs as the yellow metal cleared $5,600 per ounce on Thursday. 

Gold had surged past the $5,000 threshold for the first time this Monday, marking a weekly gain of over 10%. 

This rally is attributed to a combination of strong factors: robust safe-haven investment, persistent central bank purchases, and a depreciation of the dollar.

The strength persisted into early-morning trading in Asia, driving gold on COMEX to a new peak of $5,625.89 per ounce at one point.

Prices were currently just shy of $5,600 an ounce. 

Experts and brokerages had raised their forecast for gold, with many expecting the metal to hit $6,000 by the end of this year.

However, the way prices have been behaving, one would not be surprised if that ceiling were breached sooner. 

“Geopolitical tensions, a weaker dollar, and investor rotation out of currencies have boosted the precious metal,” Ewa Manthey, commodities strategist at ING Group, said in a note. 

Silver has seen a gain of nearly 65%, significantly outperforming gold, which is up approximately 27% year-to-date.

Unperturbed by Fed’s hawkish tone

“Meanwhile, the non-yielding Gold seems rather unaffected by US Federal Reserve (Fed) Chair Jerome Powell’s hawkish remarks on Wednesday that followed the highly anticipated decision to leave interest rates unchanged,” Haresh Menghani, editor at FXStreet, said in a report. 

Even the underlying bullish tone – as depicted by a generally positive sentiment around the equity markets – does little to hinder the bullion’s strong positive momentum.

As expected, the US Federal Reserve maintained its current interest rates following its two-day meeting that concluded on Wednesday. 

However, the decision was not unanimous, as two Fed Governors, Stephen Miran and Christopher Waller, dissented, advocating instead for a 25 basis-point rate cut.

Despite Fed Chair Jerome Powell stating in the post-meeting press conference that inflation remains significantly above the 2% target, the subdued market reaction indicated that investors continue to harbor concerns regarding potential threats to the Fed’s independence.

The independence of monetary policy formulation is currently a key concern, highlighted by both a Department of Justice criminal investigation into Powell and the ongoing effort to dismiss Fed Governor Lisa Cook.

Traders are currently confident that the Fed will keep interest rates unchanged until at least the end of this quarter, and potentially until Chair Jerome Powell’s term concludes in May. 

Despite this expectation of near-term stability, the market is still anticipating two additional rate cuts in 2026.

Geopolitics provide support

In a development concerning international relations, US President Donald Trump, speaking on Wednesday, called on Iran to negotiate a deal regarding nuclear weapons. 

He issued a warning that if the US were to launch an attack in the future, it would significantly surpass the severity of the strike on Iranian nuclear sites that occurred last year.

In response, Tehran issued a warning, threatening to retaliate against the US, Israel, and their supporters.

Russia’s ongoing aerial campaign against Ukrainian cities and infrastructure included a recent drone strike on a passenger train in northeastern Ukraine, resulting in five fatalities.

“This, along with the emergence of fresh US Dollar selling, assists the safe-haven Gold to prolong the record-setting rally for the ninth straight day and climb to the $5,600 neighborhood during the Asian session on Thursday,” Menghani said. 

Elsewhere, silver prices on COMEX came within a whisker of hitting a record of $120 per ounce on Thursday. 

Prices touched a record peak of $119.450 an ounce earlier in the day, and were currently around $118.5 per ounce. 

The post Gold surges past $5,600 as geopolitics and weak dollar fuel record rally appeared first on Invezz

SK Hynix has overtaken Samsung Electronics in operating profit for the first time, marking a shift in South Korea’s semiconductor hierarchy as artificial intelligence reshapes the memory market.

The crossover became clear this week when the two rivals reported earnings on consecutive days.

SK Hynix’s results highlighted how leadership in advanced memory chips tied to AI infrastructure is translating into stronger profitability.

The comparison also shows how a focused strategy around high-bandwidth memory has allowed SK Hynix to move ahead of a far more diversified competitor at a moment when AI spending is accelerating across data centres and chip supply chains.

Profits tell the story

For the full year, SK Hynix reported a record operating profit of 47.2 trillion won, surpassing Samsung’s 43.6 trillion won.

Samsung remains a much larger group overall, with businesses spanning smartphones, displays, appliances, and contract chip manufacturing.

Within that structure, its memory division generated operating profits of about 24.9 trillion won in 2025.

SK Hynix, by contrast, derives nearly all of its revenue from memory chips.

That narrower focus has amplified the impact of rising demand for specialised products, particularly those used in AI servers.

As a result, gains in advanced memory pricing and volumes have flowed more directly into SK Hynix’s bottom line.

A sharper strategic focus

The latest earnings comparison also reflects how SK Hynix’s strategic positioning has evolved since its acquisition by SK Telecom for about $3 billion in 2012.

Once viewed as a second-tier memory producer, the company has steadily built scale and technical depth in high-value segments.

Its emphasis on advanced memory has become increasingly important as the industry moves beyond conventional DRAM cycles and towards AI-driven workloads.

Samsung’s diversified model provides resilience across economic cycles, but it also means that strong performance in memory does not dominate group earnings in the same way.

In an environment where AI infrastructure spending is becoming a key profit driver, SK Hynix’s concentration has proved advantageous.

High bandwidth memory advantage

At the centre of SK Hynix’s rise is its leadership in high-bandwidth memory, or HBM.

These chips are essential for AI processors and servers, including those supplied to Nvidia.

Industry researchers say SK Hynix has established an early and sustained lead in both the quality and supply of HBM, allowing it to secure a large share of AI-related contracts.

This advantage has held even as Samsung regained the top spot in overall memory revenue rankings in the fourth quarter of 2025.

According to Counterpoint estimates released in December, SK Hynix held a 57% revenue share of the HBM market in the third quarter of last year, compared with Samsung’s 22%.

The gap illustrates how leadership in a fast-growing niche can outweigh broader revenue gains elsewhere.

Rivals close the gap

Competition is intensifying as rivals work to narrow that lead.

Samsung has expanded its HBM sales and has said it remains on track to begin delivering HBM4 products, the sixth generation of the technology, this year.

Analysts tracking the AI supply chain expect Samsung to recover from last year’s quality issues and show a stronger performance with HBM4 tied to new AI processors.

Even so, expectations remain that SK Hynix will retain a dominant position.

Analysts see the HBM4 race largely as a two-player contest between SK Hynix and Samsung, with both ahead of Micron in competitiveness.

While Samsung is expected to make material progress, SK Hynix is forecast to maintain a high market share as demand for AI servers continues to grow.

A local media report on Wednesday said SK Hynix had secured more than two-thirds of HBM supply orders for Nvidia’s next-generation Vera Rubin products.

Beyond HBM, SK Hynix has also edged ahead of Samsung in the broader DRAM market.

DRAM chips are used for temporary data storage across personal computers, servers, and data centres, reinforcing SK Hynix’s position across memory categories most exposed to AI-driven demand.

The post How SK Hynix leapfrogged Samsung in the AI-driven memory race appeared first on Invezz

India and the European Union signed a long-awaited free trade agreement on Tuesday, billed by officials as the “mother of all deals”, prompting renewed scrutiny of how — or whether — the pact alters Washington’s approach to its own stalled trade negotiations with New Delhi.

The timing of the landmark trade deal, nearly two decades in the making, has been flagged by experts as especially significant.

It comes as India, a long-term US ally, has been hit with merciless tariffs from Washington — 50% on goods imported from India, including 25% in “punitive tariffs” for continuing to buy oil from Russia.

Additionally, in recent days, Trump threatened to impose 10% tariffs on European allies for standing up to him over his planned takeover of Greenland.

Although he later retracted the threat in Davos and said the tariffs were “suspended,” the episode left long-time allies across the Atlantic even more uneasy than before.

Why the India-EU trade deal begs a US question

The aforementioned reasons, experts say, have caused “accelerated” talks between India and the EU in the last few months, with the announcement of the deal capping those talks.

However, more importantly, the US also finds a mention in commentary about the EU–India trade deal, as the country is pursuing its own trade agreement with India, which has been mired in several delays, with multiple informal deadlines having been missed and no clarity whatsoever on when it will materialise.

Against this backdrop, observers were on the lookout for what Trump might have to say after the deal was signed on Tuesday amid much pomp and show.

However, no commentary was forthcoming.

US Treasury Secretary Scott Bessent, however, did attack the India–EU free trade agreement.

Speaking to ABC News, Bessent defended the Trump administration’s decision to slap steep tariffs on Indian goods, linking them directly to India’s energy trade with Moscow.

“We have put 25 per cent tariffs on India for buying Russian oil. Guess what happened last week? The Europeans signed a trade deal with India,” he said.

Bessent pointed out that the Russian oil that goes into India is used to make refined products that are then bought by Europeans, which means “they are financing the war against themselves”.

Between Washington’s tactlessness, Brussels’ pragmatism and Indian agriculture

“Washington is certainly not likely to view this (the deal) very kindly, because the US has been desperately trying to open up markets using force rather than diplomacy, and it has really not succeeded,” Biswajit Dhar, trade economist and former professor at the Jawaharlal Nehru University (JNU) in India, told Invezz.

Dhar added that Trump did not respect the sensitivities of any country, especially India, which has a complex economy, making it impossible to accept some of the conditions that Trump tried to impose.

We all know that agriculture is really the sticking point. Now, contrast that with what the EU did. It also had interests in agriculture in the beginning and wanted market access in agricultural products, but realpolitik really prevailed over everything else, and they allowed India to not offer tariff cuts on agriculture, which is how the whole thing went through..

According to reports, across multiple rounds of trade talks, Indian negotiators have consistently maintained that protecting the farm sector is a non-negotiable priority.

The entry of cheaper imports from countries like the United States — where farms are larger, mechanised and heavily subsidised — could destabilise domestic crop prices and put smaller landholders at significant risk, with 86% of India’s farmers operating on small and marginal holdings of less than two hectares.

India has not included major agricultural commodities in any free trade agreement negotiated thus far.

Can the EU–India trade deal add urgency to US–India trade talks?

There is a mixed bag of expert opinion on whether, with major global powers aligning among themselves while the US is viewed warily, the country would accelerate talks to conclude the India–US BTA.

“The EU–India deal could even light a fire under efforts to conclude a US–India trade deal and help to move negotiations forward on a comprehensive bilateral trade agreement, as US President Donald Trump and Indian Prime Minister Narendra Modi discussed last year,” said Mark Linscott, Atlantic Council nonresident senior fellow on India.

Linscott, however, maintains that while the India–EU agreement may be interpreted as a response to the Trump administration’s tariffs and tariff threats, “there is no reason it should undermine the US trade relationships with either the EU or India”.

Hardeep Singh Puri, India’s minister for petroleum and natural gas, told CNBC on Tuesday that the India–US trade deal was at a “very advanced stage”, even as he admitted he did not know when it would be concluded.

“I’m told by the people who are in it [the negotiations] that it’s at a very advanced stage, and I’m hoping that, sooner rather than later, it will also see the light of day,” he added of the US deal.

Citi analysts said on Wednesday that markets would be “keenly watching immediate repercussions” of the EU–India deal on India–US tariff talks.

There would be hope that those negotiations might be fast-tracked now, though it remains to be seen whether Indian authorities would be in a better position to withstand the higher US tariffs, given the easier access to the large EU market.

However, Dhar seeks to highlight that mere optics might not provide the US with enough fuel to hasten the talks, as the problem lies elsewhere.

Dhar says that by making “exaggerated promises” to his constituencies during the 2024 presidential elections — especially farm lobbies — of opening up the Indian market for US produce, Trump has effectively “boxed himself into a corner”.

“He really can’t move away from his campaign promise.”

In the 2024 presidential election, almost 78% of farming-dependent counties supported Trump, and Dhar has earlier written that US farm lobbies representing corn, soybean and wheat interests have also been strongly lobbying the US government for access to the Indian market.

“So, in terms of negotiating with India, agreeing to allow it to maintain higher tariffs on agriculture and deciding to revisit it at a later stage is not possible given the kind of dynamics that he himself has set in motion. So I don’t see how the situation is going to change,” he said.

The post Can the India-EU trade deal put India-US talks into fast gear? appeared first on Invezz