Business

SAN FRANCISCO — Uber on Wednesday reported a profit in second quarter on one-time gains and said its pandemic-stalled ride-hailing business was showing signs of recovering.

The San Francisco-based company reported a profit of $1.1 billion. Revenue rose to $3.9 billion in the recently ended quarter, more than double what it took in during the same period last year.
The net income for the quarter included gains of $1.4 billion from the revaluation of its investment in Chinese ride-share firm Didi and another $272 million from its stake in the autonomous technology firm Aurora, according to Uber.

Uber made "strong progress" in luring drivers and couriers back to its smartphone-summoned ride and delivery businesses, chief executive Dara Khosrowshahi said in an earnings release.

But its delivery operations including Uber Eats generated the largest amount of revenue, with the unit continuing to benefit from trends that began during pandemic lockdowns last year.

"Our platform is getting stronger each quarter, with consumers who engage with both Mobility and Delivery now generating nearly half of our total company gross bookings," Khosrowshahi said.

Revenue from Uber's rides and delivery units essentially doubled, while money taken in by a freight division that connects truckers with shippers jumped 65 per cent, according to Uber.

"Uber's ride sharing business is on a clear path to recovery, however, expect some hiccups along the way as the delta variant, particularly as many drivers still feel uncomfortable with customers in their cars," said eMarketer analyst Eric Haggstrom.

"On the delivery side, new verticals such as grocery and alcohol have shown incredible early traction."

Uber shares were down more than 7 per cent in after-market trades that followed release of the earnings figures.

Uber in July announced a $2.25 billion deal to beef up its freight unit with the acquisition of Transplace, a firm specializing in logistics management software.

TOKYO — Sony upgraded its full-year profit forecast on Wednesday on the back of a strong quarterly performance, although the pandemic boom enjoyed by the gaming sector is slowing.

The Japanese conglomerate said solid earnings in its music and consumer electronics businesses offset a first-quarter operating profit decline in the gaming sector.

A box-office triumph for the anime epic "Demon Slayer", distributed by Sony's animation unit Aniplex, also boosted its better-than-expected quarterly results.

Sony Group now predicts a net profit of 700 billion yen ($6.4 billion) for the fiscal year to March 2022, up from its earlier estimate of 660 billion yen.

For the three months to June, net profit rose 9.4 per cent to 211.8 billion yen, Sony said. Its annual sales forecast was unchanged at 9.7 trillion yen after first-quarter sales gained 15 per cent to 2.26 trillion yen.

The figures showed Sony "displaying its underlying strength", said Hideki Yasuda, an analyst at Ace Research Institute in Tokyo.

"This result showed the advantage of a conglomerate — strong sectors can offset weakening ones," he said.

While the upward annual forecast revision came as a surprise, "sales of digital cameras were much better than expected. And music-streaming businesses were also stronger than we thought," Yasuda added.

Although COVID-19 hit many industries hard, the gaming sector was one of the few to benefit, with demand soaring as people sought distractions during long periods stuck at home.

In the previous fiscal year, Sony reported its biggest-ever annual net profit, which more than doubled to 1.17 trillion yen on record sales of 8.99 trillion yen. The group's latest annual net profit forecast remained lower than the bumper result last year, in which lockdown demand had boosted software sales.

"Demand is sharply weakening this year" for gaming products, as vaccines help life move closer to normality despite the spread of the Delta variant, Yasuda had warned before the earnings release.

Sony launched its PlayStation 5 last year but the console remains in short supply, leaving many would-be customers empty-handed.

A global microchip shortage has also hobbled production of a wide range of goods, from cars to computers.

"Sony risks losing would-be users if the current supply shortage continues," said Yasuo Imanaka, chief analyst at Rakuten Securities.

In December, the animated film "Demon Slayer", in which a teenager hunts down and beheads demons, became Japan's top-grossing film of all time.

The title also had the best opening ever recorded in North America for a foreign-language film.

'Demon Slayer' contributed a lot in the fourth quarter of the last fiscal year, but the contribution is weakening," Yasuda said.

Sony, which started as a tiny radio maker in the years after World War II, is now enjoying steady growth in its entertainment businesses as a vital source of revenue.

The manufacturer of the Walkman has performed strongly in recent years after recovering from massive losses in the early 2010s, when it struggled to overcome deep financial trouble by cutting jobs and selling divisions.

"But Sony's performance could level off this year," Yasuda said.

SAN FRANCISCO — A US labour official has recommended the results be nullified in a failed vote to unionise Amazon workers at an Alabama warehouse, the union in the effort said on Monday, opening a possible path to a new election.

The recommendation by a hearing officer is a key step in potentially overturning the April ballot, which aimed to create the first union at US-based Amazon facility but which the union alleges was tainted by the company's interference.

US labour watchdog, National Labour Relations Board (NLRB), would need to give its approval for the proposal to take effect. 

The results, showed a wide majority of workers rejecting the move, capped a bruising months-long battle that sparked intense debate over workplace conditions at Amazon, which has more than 800,000 US employees.

"We support the hearing officer's recommendation that the NLRB set aside the election results and direct a new election," Retail, Wholesale and Department Store Union President Stuart Appelbaum said in a release.

"Amazon's behavior throughout the election process was despicable."

Amazon has held firm that it did not interfere with the voting, and said it will appeal the hearing officer's recommendation.

"Our employees had a chance to be heard during a noisy time when all types of voices were weighing into the national debate, and at the end of the day, they voted overwhelmingly in favor of a direct connection with their managers and the company," Amazon said in response to an AFP inquiry.

"Their voice should be heard above all else, and we plan to appeal to ensure that happens."

Amazon has argued that most of its workers don't want or need a union and that it already provides more than most other employers, with a minimum $15 hourly wage and other benefits.

The labour group said workers were bombarded with anti-union messages, and claimed the company's use of a drop-box outside the warehouse could have intimidated employees.

The Amazon drive was seen as a watershed for a diminished US labour movement, with activists aiming to use the Alabama warehouse as a catalyst for other organising efforts.

SAN FRANCISCO — Zoom, the videoconferencing firm, has agreed to settle a class-action US privacy lawsuit for $85 million, it said on Sunday.

The suit charged that Zoom's sharing of users' personal data with Facebook, Google and LinkedIn was a breach of privacy for millions.

While Zoom denied wrongdoing, it did agree to improve its security practices.

The settlement needs to be approved by US District Judge Lucy Koh in San Jose, California.

A Zoom spokesman told AFP: "The privacy and security of our users are top priorities for Zoom, and we take seriously the trust our users place in us.

"We are proud of the advancements we have made to our platform, and look forward to continuing to innovate with privacy and security at the forefront."

The settlement will set up a "non-reversionary cash fund of $85 million to pay valid claims, notice and administration costs, Service Payments to Class Representatives, and any attorneys' fees and costs awarded by the court", according to the preliminary settlement.

All class members are eligible for payment, it said.

Those who paid for an account can receive 15 per cent of the money they paid to Zoom for their core subscription during that time or $25, whichever is greater; while those who did not pay for a subscription can make a claim for $15. 

As the coronavirus pandemic closed offices due to health risks and companies shifted to working online, use of video and collaboration platforms hosted by companies including Zoom, Slack, Microsoft, and Google rocketed.

But Zoom's rapid growth came with pressure to deal with security and privacy as the platform faced scrutiny from rising usage.

AMMAN — Arab Bank Group net income after tax totalled $182.4 million at the end of the first half of 2021 compared to $152.1 million for the same period last year, recording a growth of 20 per cent, according to a bank statement received by The Jordan Times on Sunday. 

During the first quarter of 2021, Arab Bank consolidated the financial statements of Oman Arab Bank under its Group accounts increasing total assets by $8.2 billion to reach $63 billion compared to $51.6 billion for the same period last year. Oman Arab Bank has also recently finalised the acquisition of Al Izz Islamic Bank, a full-fledged Islamic bank, strengthening its presence in the Sultanate of Oman.

Customer deposits grew by 28 per cent to reach $46 billion, while loans grew by 27 per cent, to reach $33.8 billion. The consolidation of Oman Arab Bank has materially increased customer deposits and loans by $7 billion and $7.2 billion, respectively.

 In the statement, Sabih Masri, chairman of the Board of Directors said the results demonstrate the strength of the Bank’s diversified business model and the Bank’s resilient performance in this challenging economic environment.

Nemeh Sabbagh, chief executive officer (CEO), said despite the negative economic consequences of the pandemic, the Bank's robust performance confirms its effectiveness in operating in a challenging economic environment as net operating income increased by 6 per cent to reach $579.8 million. He added that the Group enjoys high liquidity and a strong capital base with a loan to deposit ratio of 73.5 per cent. 

Moreover, Sabbagh said the Group continues to hold credit provisions against non-performing loans in excess of 100 per cent.

Arab Bank has recently issued its eleventh annual sustainability report, which provides a summary of the Bank's performance and achievements in the social, environmental and economic fields for the year 2020.

During the board meeting which took place on Thursday, the board approved the appointment of Mahmoud Malhas as board member and he was elected as Deputy Chairman of the Board.

Sabbagh, who has had a 47 year career in banking and finance and has been the CEO of Arab Bank for the past 12 years, informed the board of his desire to retire at the end of the year. 

He recommended the appointment of Randa Sadik as his successor. Sadik has been deputy CEO since 2010. 

NEW YORK — Amazon was fined 746 million euros ($880 million) by Luxembourg authorities over allegations it flouted the EU's data protection rules, the online retail giant said on Friday.

The fine was issued on July 16 by the Luxembourg National Commission for Data Protection following its determination that "Amazon's processing of personal data did not comply with the EU General Data Protection Regulation [GDPR]", Amazon said in a securities filing. 

"We believe the CNPD's decision to be without merit and intend to defend ourselves vigorously in this matter," the company added, using the organisation's French acronym.

The fine was believed to be the largest ever for a data protection violation since the passage of the regulation.

The Securities and Exchange Commission document offered no details, but Amazon was sued by a European consumer group claiming personal data was collected for ad targeting without permission.

The Luxembourg agency confirmed that it made a ruling this month on Amazon but declined to elaborate, saying its investigations are confidential.

It was the latest case of US tech firms being hit with violations of the landmark GDPR.

French authorities fined Amazon 35 million euros last year for failing to follow laws on browser "cookies" that track users. Google was hit with a fine of 100 million euros for similar violations.

Facebook is under investigation in Ireland after details on 533 million users were leaked on a hacking website

Under the GDPR, which came into effect in 2018, Internet users have a wider range of rights relating to their data.

Regulators have been armed with new powers including the ability to fine firms up to 4 per cent of their annual global turnover.

The GDPR has resulted in fines imposed not only on technology firms but marketers, data brokers, Austria's postal service and even the Spanish football association, La Liga.

Amazon made the disclosure as part of its quarterly update which showed profits jumped 48 per cent from a year ago to $7.8 billion and revenues increased 27 per cent to $113.1 billion in the April-June period.

SEOUL — Samsung Electronics' net profits surged more than 70 per cent in the second quarter thanks to higher memory chip prices fuelled by pandemic-led demand, the South Korean tech giant reported on Thursday.

Coronavirus-driven working from home boosted demand for devices and appliances powered by Samsung's memory chips. The company said that "memory shipments exceeded previous guidance and price increases were higher than expected".

The world's biggest smartphone maker saw net profits rise 73.4 per cent year-on-year to 9.6 trillion won ($8.4 billion) for April-June, the company said in a regulatory filing.

Operating profit increased 54.3 per cent to 12.6 trillion won from 8.1 trillion won a year earlier, more than half of which came from the firm's semiconductor business.

These results come despite an on-quarter decline in Samsung's earnings from its smartphone business because of supply chain problems that disrupted global production.

Samsung Electronics is the flagship subsidiary of the giant Samsung group, by far the largest of the family-controlled empires that dominate business in South Korea, the world's 12th largest economy. 

The conglomerate's overall turnover is equivalent to one-fifth of gross domestic product. 

Analysts say the chip unit's proportion of the firm's profit is likely to grow in the months ahead.

"Samsung will benefit from memory chip prices that are likely to go higher in the third and fourth quarter," Park Sung-soon, an analyst at Cape Investment & Securities, said.

The firm anticipates favourable market conditions for the rest of the year, with continued demand for memory chips in the server and mobile markets. 

But it warned pandemic-fuelled uncertainty would persist in the second half, noting "continued disruptions in component supply".

Shares in Samsung Electronics closed down 0.25 per cent on Thursday. 

Eligible for parole 

Samsung is expected to showcase the latest foldable smartphone models of its Galaxy Z and clamshell Galaxy Z Flip next month. 

Makers of foldables are increasingly competitive, and include rivals such as China's Huawei and Xiaomi. 

The upcoming gadgets will be equipped with "new multitasking capabilities and enhanced durability", said TM Roh, head of Samsung Electronics' mobile communications business. 

Samsung aims to solidify its position in the smartphone market "with the rollout of its premium mobile lineups as well as cheaper models in the third quarter", said James Kang, senior analyst at Euromonitor International. 

But Kang said the company could face headwinds next year, as consumer demand is likely to be weaker than in 2021. 

Samsung also faces legal challenges. 

Its leader Lee Jae-yong is currently on trial, charged with manipulating a takeover to smooth his succession at the top of the Samsung group.

Lee was separately jailed in January over a sprawling corruption scandal that brought down former president Park Geun-hye.

South Korea's corporate leaders and scholars say a leadership vacuum could hamper the firm's decision-making about large-scale investments, previously key to its global rise.

But Lee's absence would not have much of an impact on Samsung's earnings for the second half, said Park of Cape Investment. 

Still, his return to management "could accelerate the decision-making process for long term investments", he added. 

Lee is eligible for parole next month after completing more than half of his two-and-a-half year jail term.

Meanwhile, LG Electronics, South Korea's second-largest appliance firm after Samsung, posted a 65.5 per cent jump in operating profit for the second quarter, to 1.1 trillion won. Its shares rose 1.5 per cent.

LONDON, United Kingdom — European stock markets rose on Wednesday as investors cautiously awaited a key Federal Reserve (Fed) interest rate decision and digested a raft of earnings.

London shares climbed 0.3 per cent in late morning deals, with Barclays soaring almost 3 per cent on news of surging first-half profit at the UK bank.

Frankfurt also won 0.3 per cent and Paris jumped 0.9 per cent in early afternoon eurozone trade.

Madrid added 0.7 per cent but Santander stock shed 0.8 per cent despite the Spanish lender revealing that it rebounded into bumper quarterly profit.

The Fed's monetary policy meeting ending on Wednesday was closely watched for any guidance on its plans in light of the economic recovery, reopening and spread of the Delta coronavirus variant that has sent infections spiking.

"As always, investors will want to know the central bank's latest view on the outlook for the US economy and whether it is time to tinker with policy support measures,” said AJ Bell analyst Danni Hewson.

"The spread of the Delta virus variant in recent weeks and months could give the Fed reason to make no changes to its policy, but any sign of taking a more forward-looking view and wanting to taper bond purchases could cause ripples across global markets."

Investors were underwhelmed by better-than-expected earnings from US tech titans Apple, Google-parent Alphabet and Microsoft.

Apple's third-quarter profit rose to $21.7 billion on growth in iPhone sales.

Asian markets mostly fell again on Wednesday as fears over China's regulatory crackdown continued to reverberate around trading floors, following losses on Wall Street.

Hong Kong and Shanghai were in focus after suffering a diabolical previous three days in the wake of Beijing unveiling a series of measures aimed at curbing a range of industries — including tech and private tuition — that have raised fears of further action.

Hong Kong rose more than 1 per cent having oscillated wildly but it made only a small dent in the more than nine per cent drop suffered over the previous three days.

Bitcoin sat around $39,500 following a recent rally that has helped it briefly break $40,000, helped by renewed support from tycoon Elon Musk and other investors, with some analysts saying it could test $45,000 again soon.

WASHINGTON — While the global economy is still growing, the uneven distribution of vaccines is widening disparities as rich countries pick up speed and leave developing nations behind, the International Monetary Fund (IMF) warned on Tuesday.

"Vaccine access has emerged as the principal fault line along which the global recovery splits into two blocs," the IMF said in its updated World Economic Outlook.

But the IMF warned of the danger to the whole world if new virus variants are allowed to take hold.

The recovery "is not assured even in countries where infections are currently very low so long as the virus circulates elsewhere", the report said.

World gross domestic product (GDP) will expand by 6 per cent this year, unchanged from the April forecast, but IMF Chief Economist Gita Gopinath flagged the "widening gap" as advanced economies grow faster and developing nations, especially in Asia, slow.

The United States is projected to see much faster growth this year than previously forecast, expanding seven per cent growth thanks to massive government spending and widespread COVID-19 vaccinations, but the IMF slashed the forecast for India, which is facing a resurgence of infections.

The Washington-based crisis lender once again stressed that "the immediate priority is to deploy vaccines equitably worldwide", and pushed a $50 billion plan that offers a "feasible cost to end the pandemic".

Advanced nations have vaccinated nearly 40 per cent of the population, compared to barely 11 per cent in emerging markets and a tiny fraction in low-income countries, the report said.

Gopinath said "at least 1 billion vaccine doses should be shared in 2021 by countries with surplus vaccines."

Failure to achieve widespread vaccinations could allow highly infectious virus variants to take hold, like the Delta variant that has become prevalent. That could derail the recovery, wiping out $4.5 trillion cumulatively from global GDP by 2025, more than half of that lost from rich nations, the fund estimates.

This is not just a "tail risk" that is highly unlikely but "a realistic downside risk", said Petya Koeva-Brooks, deputy director of the IMF Research Department.

More worried now 

Although some emerging market nations like Brazil and Mexico are poised to show stronger growth this year, developing nations as a group are struggling to return to their pre-pandemic levels.

"I would say we're more worried than we were back in April," Koeva-Brooks said.

Vaccinations allowed an economic reopening and led to upgrades for the United States for this year and next, when growth is expected to hit 4.9 per cent.

However, that assumes the US Congress will approve another round of spending later this year of about $4 trillion in President Joe Biden's infrastructure and job creation programmes.

The IMF also raised the 2021 estimates for Canada and Britain to 6.3 per cent and 7 per cent, respectively, while the euro area GDP is expected to expand 4.6 per cent, just slightly higher than the April WEO.

India's growth forecast was slashed three points to 9.5 per cent, and even China was trimmed by three-tenths of a per centage point to 8.1 per cent.

In Latin America, Mexico is expected to post higher growth, helped by the positive spillovers from the recovering US economy as well as from increasing domestic demand, while Brazil also got a boost amid rising commodity prices, which will fade next year, the report said.

Temporary 

or persistent? 

Rising prices are another factor weighing on the global recovery, and pose a challenge to policymakers.

While the recent inflation spike is the result of the unprecedented and uneven turnaround from the pandemic and should prove temporary, the IMF raised the possibility that price increases could become "persistent".

"The unprecedented convulsion in the global economy last year continues to trigger aftershocks," the IMF said, pointing to a shortage of computer chips and a lack of shipping containers where they are needed, which has delayed deliveries of materials.

Koeva-Brooks said some of the bottlenecks and price jumps were to be expected and should be temporary, but acknowledged that the situation is hard to measure.

"We've never seen how to reopen economies after a crisis like this one," she said.

The IMF said inflation should return to pre-pandemic ranges in 2022 and urged central banks to hold off on reacting to the temporary price pressures — but to be ready to take "preemptive action".