In today’s briefing:
- Apple Mar-25 Inline, June Slightly Weak as Tariffs Hit Margins, Supplychain Reshuffling Out of China
- If I Wanted to Bet on Humanoids, I’d Buy Meta.
- Amazon 1Q’25 Update
- Hyperscale Capex Is Maintained or Increased No Cuts or Postponement Capacity Constrain at AMZN GOOG
- [Alert] Buy Lionsgate Entertainment
- Intel Slashes Forecasts and Jobs—Is This the Beginning of the End or a Comeback Story?
- Baidu’s AI Shake-Up: Can ERNIE 4.5 Turbo Outmaneuver DeepSeek & Alibaba?
- Biggest Cyberattack in SK Telecom’s History – Likely to Lead to Major Management Changes
- Hybridan Small Cap Feast: 24/04/2025
- Will Tyler Technologies’ Bold AI Investments Redefine the Future of Public Sector Innovation?
Apple Mar-25 Inline, June Slightly Weak as Tariffs Hit Margins, Supplychain Reshuffling Out of China
- 2Q25 small 2% beat. Products revenue (iPhone, Mac, etc) up 3% YoY. Services up 12%. Jun-25: low- to mid-single digit revenue growth YoY (inline), 100bps hit to margins or US$900m.
- Good effort to articulate supply chain reshuffle for products sold in US: iPhone from India, the rest from Vietnam. Beyond June, no quantification of impact on costs and demand.
- Despite low 5-8% EPS growth, the stock is expensive due to steady Services growth and large cash returns to shareholders. Trading at 29x FY25 EPS, 27x FY26.
If I Wanted to Bet on Humanoids, I’d Buy Meta.
The commercialization of general purpose humanoid robots could be the most disruptive innovation that the next few decades have in store for us.
It would be a new computing platform that would by far surpass everything that we have seen in personal and mobile computing.
AI would be liberated from cyberspace to real space. Instead of shifting bits and bytes around, it would be moving physical objects.
Amazon 1Q’25 Update
- While Amazon’s 3P business usually grows faster than 1P, both 1P and 3P retail business grew at similar rate in 1Q’25.
- Ads revenue continued its momentum at 19% growth YoY which was higher than both Google and Meta.
- After growing at ~19% YoY for the last three consecutive quarters, AWS growth decelerated this quarter to 17%.
Hyperscale Capex Is Maintained or Increased No Cuts or Postponement Capacity Constrain at AMZN GOOG
- What did hyperscalers say on Capex in March conf calls? Amazon: nothing. Google: maintained. Meta: increase. Microsoft: maintained. No Capex cuts or postponement.
- At the opposite, Amazon and Google mention capacity constraints, revenues could be higher with more capacity. All firms mention that AI is a critical building block of future growth.
- Financial statements show 1) improving operating margins, 2) higher capex but still higher free cash flow. Positive for NVIDIA Corp (NVDA US) and Taiwan Semiconductor (TSMC) (2330 TT) .
[Alert] Buy Lionsgate Entertainment
On a sum-of-the-parts basis, LION and STRZ are worth significantly more than is reflected in LGF.A’s stock price.
At the close today, investors could buy 1 share of Lionsgate Entertainment (LGF.A) for $8.90. On May 6, that investor will receive 1.12 shares of LION and 1.12 shares of STRZ.
I estimate LION is worth $11 and STRZ is worth $1.71. As such, it looks like there is ~60% upside
Intel Slashes Forecasts and Jobs—Is This the Beginning of the End or a Comeback Story?
- Intel’s first-quarter results for 2025 painted a mixed picture, marked by a modest financial beat but overshadowed by weak forward guidance and deep-rooted structural challenges.
- Under the newly appointed CEO Lip-Bu Tan, who took charge just five weeks ago, the company reported adjusted earnings of $0.13 per share on revenue of $12.7 billion—both surpassing Wall Street expectations.
- Gross margins reached 39.2%, higher than the guided 36%, buoyed by stronger-than-expected sales of Xeon and Raptor Lake chips.
Baidu’s AI Shake-Up: Can ERNIE 4.5 Turbo Outmaneuver DeepSeek & Alibaba?
- Baidu is intensifying its AI initiatives with the launch of ERNIE 4.5 Turbo and ERNIE X1 Turbo, aiming to solidify its position in China’s competitive AI landscape.
- These models boast enhanced multimodal capabilities and are priced significantly lower than competitors, with ERNIE 4.5 Turbo costing just 1% of GPT-4.5’s price.
- In a strategic shift, Baidu plans to open-source ERNIE 4.5 by June 30, 2025, and has made its ERNIE Bot free for individual users.
Biggest Cyberattack in SK Telecom’s History – Likely to Lead to Major Management Changes
- SK Telecom experienced the biggest cyberattack in its history in April which is likely to result in a major shakeup of its management team.
- We estimate SK Telecom could lose 1 million+ mobile service customers. Given its ARPU of 29,355 won per month, this would represent lost annual revenue of nearly 352 billion won.
- This massive cyberattack could cost SK Telecom more than 1 trillion won in a combination of lost revenue and additional commission/advertising necessary to attract new customers.
Hybridan Small Cap Feast: 24/04/2025
- The provider of Decision Intelligence software for service operations, provided an update on trading for the year ended 31 March 2025.
- Group revenue is expected to have increased by 13% or 15% on a constant currency basis, to approximately £30.4m, reflecting upsell of the latest iterations of its Decision Intelligence software and the successful go live with several major new customers.
- SaaS revenues increased by approximately 13%, or 14% on a constant currency basis, up from 8% growth in the prior year.
Will Tyler Technologies’ Bold AI Investments Redefine the Future of Public Sector Innovation?
- Tyler Technologies, a leader in providing integrated software solutions for the public sector, reported its first quarter 2025 financial results revealing both strengths and challenges.
- The company achieved a 10.3% year over-year revenue growth to $565.2 million, driven by a robust increase in subscriptions revenue, which climbed by 19.7%.
- Notably, Software-as-a-Service (SaaS) revenues grew 21%, marking continuous growth in this area for 17 consecutive quarters.
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