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Tag: Computer Services

  • Even Cloudflare's CEO says that viral firing video is 'painful' — here's what went wrong

    Even Cloudflare's CEO says that viral firing video is 'painful' — here's what went wrong

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    A tech employee’s recording of the meeting firing her from a sales role at Cloudflare
    NET,
    -1.79%

    has spurred criticism of the company — and a broader conversation about the right way to let employees go.

    Viewers have called the roughly 10-minute TikTok video, which went viral this week, “sad” and a “disaster.” Even Cloudflare CEO Matthew Prince responded on X (formerly Twitter) that it was “painful for me to watch.”

    In the video captioned, “POV: You’re about to get laid off,” former Cloudflare account executive Brittany Pietsch logs into a virtual meeting with an HR representative and a director at the company, both of whom she says she’s never met before. In a caption, Pietsch writes that she assumed they were meeting to let her go, because she had heard from coworkers who had been axed already.

    In the video, the company reps say that Pietsch hadn’t met performance expectations, and that Cloudflare had decided to “part ways” with her. Pietsch’s response is what has pushed this clip to be shared all over social-media newsfeeds: She asks for an explanation for why she, specifically, is being let go by the company, particularly because she’s a new employee who hasn’t heard any negative feedback. She also asks why her manager isn’t a part of this termination meeting.

    “Every single one-on-one [meeting] I’ve had with my manager, every conversation I’ve had with him — he’s been giving me nothing but ‘I am doing a great job,’” she says during the meeting. “I’m just definitely very confused and would love an explanation that makes sense.” 

    The director, who can’t be seen in the video, says he “won’t be able to go into specifics” on Pietsch’s performance. 

    In a statement to MarketWatch, a Cloudflare spokesperson clarified that the company did not conduct layoffs, and is not engaged in a reduction of force. “When we do make the decision to part ways with an employee, we base the decision on a review of an employee’s ability to meet measurable performance targets,” the Cloudflare statement said. “We regularly review team members’ performance and let go of those who aren’t right for our team. There is nothing unique about that review process or the number of people we let go after performance review this quarter.”

    Pietsch did not immediately respond to a request for comment. 

    Company CEO Prince added on X, formerly known as Twitter, that the company fired 40 salespeople out of 1,500 in its go-to-market division. “That’s a normal quarter,” he wrote in his post. “When we’re doing performance management right, we can often tell within 3 months or less of a sales hire, even during the holidays, whether they’re going to be successful or not.” 

    But he also added: “We try to fire perfectly. In this case, clearly we were far from perfect. The video is painful for me to watch. Managers should always be involved. HR should be involved, but it shouldn’t be outsourced to them … We don’t always get it right.”

    Many viewers seem to agree, as the video has drawn close to 200,000 views on TikTok and millions of views on X, along with going viral on Reddit.

    “Total disaster on both sides,” lawyer Eric Pacifici said. 

    “Totally unfair to her,” wrote Austen Allred, CEO of the online-coding bootcamp Bloom Institute of Technology. “Pretty sad across the board.” 

    On LinkedIn, Pietsch gave her own response to the social-media uproar. She said that her manager was unaware that she was being let go, and that she asked questions during the meeting not to try and save her job, but rather to get greater clarity on why she had been singled out for termination. 

    “I’ll never be able to wrap my mind around it,” she wrote in the post. “We as employees are expected to give 2 weeks notice and yet we don’t deserve even a sliver of respect when the roles are reversed?”

    What’s the right way to fire an employee? 

    It’s never easy to part ways with an employee, according to Molly, a human-resources consultant who runs the TikTok account HR Molly, which has 80,000 followers. She asked only to be identified by her first name for privacy reasons. 

    But that being said, it’s very important to treat affected employees with respect. That can include sharing as much information as possible about why the decision is being made. 

    “I tell people that even if you catch someone stealing, even that termination meeting should have a level of decency,” she said. “It seems like there’s a significant consensus that the meeting [in the viral video] lacked some dignity.”

    It’s also important to understand these kinds of conversations will be difficult for an employee no matter what, Molly added. 

    “We know this impacts people and we know this is emotional and that it’s harmful. How can we do it in a way that creates the least amount of additional harm?” she said, noting that she picked up the concept from fellow TikTok creator and diversity consultant Ciarra Jones. “Companies need to prioritize the well-being of the employee that’s impacted.” 

    As for recording your layoff or firing meeting — that can be risky, Molly said, and downright illegal in states that require you to receive consent before doing so.

    But companies and HR professionals would be wise to remind themselves that, in this day and age, it can happen, she said. And if a camera or tape recorder would change the way you handle an interaction, it’s a good sign to reevaluate.

    According to its company website, Cloudflare has dozens of job postings for open positions across the company, including sales roles.

    In her LinkedIn post, Pietsch said that she’s not very concerned about any backlash over the video that might impede her chances of getting another job. 

    “Any company that wouldn’t want to hire me because I shared a video of how a company fired me or because I asked questions as to why I was being let go is not a company I would ever want to work for anyway,” she wrote.

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  • DocuSign's stock pops as company reportedly considers a sale

    DocuSign's stock pops as company reportedly considers a sale

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    One-time pandemic darling DocuSign Inc. may be looking to sign a deal of its own.

    The e-signature company is working with advisers as it considers a sale, the Wall Street Journal reported Friday afternoon. A deal for DocuSign
    DOCU,
    +11.37%
    ,
    valued at upwards of $11 billion, could result in one of the largest recent leveraged buyouts, the report said, noting that private-equity firms and technology companies were among the potential suitors.

    DocuSign shares were up more than 11% in afternoon trading Friday following the report.

    A DocuSign spokesperson said the company doesn’t comment on rumors or speculation.

    The company was a pandemic-era poster child as businesses looked for ways to get signatures on contracts, mortgages and other documents in a virtual world. But DocuSign has struggled to match its earlier growth rates as offices have resumed in-person activity, and management acknowledged a tough macroeconomic environment when DocuSign last posted earnings.

    DocuSign shares traded above $310 at their highest point in September 2021, but they closed Thursday near $56. The stock was changing hands just south of $64 Friday amid the intraday rally.

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  • Oracle Stock Falls After Earnings Report Disappoints

    Oracle Stock Falls After Earnings Report Disappoints

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    Oracle shares were heading sharply lower in late trading Monday after the enterprise software giant posted November quarter financial results that fell short of both the company’s own guidance and consensus Street estimates.

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  • Snowflake Shares Gain on Strong Earnings

    Snowflake Shares Gain on Strong Earnings

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    Snowflake shares were gaining ground Wednesday after the cloud data warehouse software company posted better-than-expected results for the quarter ended Oct. 31.

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  • Zscaler’s stock falls after earnings as company keeps billings outlook intact

    Zscaler’s stock falls after earnings as company keeps billings outlook intact

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    Zscaler Inc. topped expectations with its results for the latest quarter and its outlook for the ongoing one, but shares of the cybersecurity company were moving lower in Monday’s extended session as Zscaler declined to up its full-year billings forecast.

    Calculated billings for the fiscal first quarter came in at $457 million, up from $340 million a year prior, whereas analysts had been looking for $443 million. Despite showing upside in the latest quarter, Zscaler ZS kept its full-year forecast at $2.52 billion to $2.56…

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  • Elon Musk’s X apocalyptic moment

    Elon Musk’s X apocalyptic moment

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    Is this the beginning of the end for X, the social-media site previously known as Twitter?

    In the last two days, major advertisers, ranging from IBM Corp. IBM, Apple Inc. AAPL, Lions Gate Entertainment Corp. LGF.A, Walt Disney Co. DIS, even the European Union, have pulled their ads from X, after Elon Musk appeared to endorse antisemitic conspiracy theories and because these big spenders weren’t thrilled with the algorithm’s product placement nestled alongside pro-Nazi posts.

    Earlier…

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  • IBM pulls ads from X after Elon Musk’s incendiary comments over white pride

    IBM pulls ads from X after Elon Musk’s incendiary comments over white pride

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    IBM Corp.
    IBM,
    +0.31%

    has abruptly pulled ads from X, formerly Twitter, amid a maelstrom of controversial comments from billionaire owner Elon Musk and the placement of IBM ads.

    “IBM has zero tolerance for hate speech and discrimination and we have immediately suspended all advertising on X while we investigate this entirely unacceptable situation,” the company said in a statement emailed to MarketWatch.

    IBM suspended advertising following a report by the Financial Times on Thursday that IBM ads appeared next to posts supporting Adolf Hitler and the Nazi Party. A Media Matters study also found ads from Apple Inc.
    AAPL,
    +0.90%
    ,
    Oracle Corp.
    ORCL,
    +0.53%
    ,
    and Comcast Corp.’s
    CMCSA,
    -0.28%

    Xfinity and Bravo were adjacent to pro-Nazi content.

    On Wednesday, Musk agreed with a post on X supportive of an antisemitic conspiracy theory that Jewish people hold a “dialectical hatred” of white people. “You have said the actual truth,” Musk wrote in response to the post.

    Compounding matters, Musk on Thursday said on X it was “super messed up” that white people are not, in the words of one far-right user’s tweet, “allowed to be proud of their race.”

    Adding fuel to the fire, Musk said on Wednesday that the Jewish advocacy group the Anti-Defamation League “unjustly attacks the majority of the West, despite the majority of the West supporting the Jewish people and Israel.” (Musk has threatened to sue the ADL because of its criticism of lax moderation practices on X that it says have allowed antisemitism to spread.)

    The cascading conflagration prompted Tesla Inc.
    TSLA,
    -3.81%

    bull and investment adviser Ross Gerber to grumble on X: “Getting a flood of messages from clients wanting out of tesla and anything to do with Elon Musk. Many saying they are selling their cars as well. What is he doing to the tesla brand??!!?!?”

    Earlier this year, Gerber backed down from his “friendly activist” efforts to join Tesla’s board, saying he felt his concerns had been addressed. His firm, Gerber Kawasaki Wealth and Investment Management, has its own ETF, AdvisorShares Gerber Kawasaki 
    GK,
     which has Tesla as its top investment, and has attracted many clients with Tesla shares in its portfolios

    In an interview on CNBC late Thursday, Gerber said that while he is not selling his Tesla stock, ” I’m not going to mince words about it anymore as a shareholder. It’s absolutely outrageous, his behavior and the damage he’s caused to the brand.”

    Gerber said Musk has essentially abdicated his responsibilities as Tesla CEO: “It’s all about Twitter, and what he can tweet, and how many people he can piss off… What’s going to happen to Tesla over the next 10 years, are they gonna achieve their mission if the CEO isn’t actually the CEO? Because he’s certainly not acting as the CEO of Tesla.”

    An X executive told MarketWatch that the company did a “sweep” of the accounts next to the IBM ads. Those accounts “will no longer be monetizable” and specific posts will be labeled “Sensitive Media.”

    The executive said 99% of measured ad placements on X this year have appeared adjacent to content scoring “above the brand safety floor” criteria set by industry standards.

    Late Thursday, X’s chief executive, Linda Yaccarino, tweeted: “X’s point of view has always been very clear that discrimination by everyone should STOP across the board — I think that’s something we can and should all agree on. When it comes to this platform — X has also been extremely clear about our efforts to combat antisemitism and discrimination. There’s no place for it anywhere in the world — it’s ugly and wrong. Full stop.”

    The posts and ad placement come amid a wave of antisemitism on digital forums including X and a downturn in advertising on the platform linked to hate speech and misinformation. Musk said in July that ad revenue had plunged about 50%.

    The latest kerfuffle is likely to complicate the efforts of Yaccarino, who was hired in June from Comcast Corp.’s
    CMCSA,
    -0.28%

    NBCUniversal to sway advertising agencies and major brands to stay on, or initiate relationships with, the platform now known as X.

    Tesla shares fell nearly 4% on Thursday but are still up about 90% to date in 2023.

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  • Datadog Stock Skyrockets 30% on Upbeat Outlook and Customer Growth

    Datadog Stock Skyrockets 30% on Upbeat Outlook and Customer Growth

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    Datadog External link stock surged Tuesday after the security software provider generated more profit than expected in the quarter and raised its sales outlook for the full year.

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  • RingCentral’s stock jumps on narrowing loss, revenue beat, raised guidance

    RingCentral’s stock jumps on narrowing loss, revenue beat, raised guidance

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    RingCentral Inc.’s stock jumped about 10% in after-hours trading Monday after it reported a narrowing quarterly loss, results that beat analysts’ forecasts on the top- and bottom-lines, and sales projections that were raised.

    The cloud-based communications company
    RNG,
    -0.25%

    posted a third-quarter net loss of $42.1 million, or 45 cents a share, compared with a net loss of $284.6 million, or $2.98 a share, in the same quarter a year ago. Adjusted earnings were 78 cents a share.

    Total revenue improved nearly 10% to $558.2 million from $509 million a year ago. Subscription sales were $531 million, or about 95% of total
    revenue.

    Analysts polled by FactSet had forecast on average adjusted earnings of 75 cents a share and revenue of $554 million.

    “The results speak for themselves: Our solid third-quarter results demonstrate our ability to drive long-term durable, profitable growth,” RingCentral Chief Executive Tarek Robbiati said in an interview. This marks his first quarter as company CEO after five years as chief financial officer at Hewlett Packard Enterprise Co.
    HPE,
    -0.13%
    .

    Robbiati credited his predecessor for the quarterly performance and vowed to “infuse AI into everything we do.”

    “We are leveraging AI into our core of products,” he added. “AI is a massive trend in turbo-charging productivity.”

    At the same time, RingCentral raised its annual total revenue guidance to between $2.198 billion and $2.205 billion. FactSet analysts are projecting $2.198 billion.

    The company’s board last week also authorized an incremental $100 million stock-repurchase plan.

    Shares of RingCentral are down 20% in 2023; the broader S&P 500 index
    SPX
    is up 14%.

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  • Amazon Stock Jumps on Earnings Beat. Cloud Results Were Good Enough.

    Amazon Stock Jumps on Earnings Beat. Cloud Results Were Good Enough.

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    Amazon shares rose in late trading Thursday after the company posted better-than-expected financial results for the September quarter.

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  • Microsoft and Alphabet results show Wall Street only cares about AI

    Microsoft and Alphabet results show Wall Street only cares about AI

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    Microsoft Corp. and Alphabet Inc. both reported mostly strong results Tuesday, but the disparate reactions from investors showed that Wall Street only cares about artificial intelligence right now.

    While Microsoft shares
    MSFT,
    +0.37%

    rose 4% in after-hours trading following the company’s latest report, Alphabet shares
    GOOG,
    +1.61%

    GOOGL,
    +1.69%

    dropped 6% as Wall Street got the sense that AI is manifesting differently in the companies’ cloud businesses.

    Microsoft surprised investors with 28% constant-currency growth in its Azure cloud-computing business, above the company’s own forecast and the projection for 25.6% growth that analysts were modeling on average. While Microsoft continues to see “optimization” challenges as customers remain conscious about their spending, the company is also benefiting from AI tailwinds in the cloud.

    Companies looking to beef up their AI offerings are often looking to add AI services for their customers through additional cloud services, so they don’t have to do as much internal development themselves. In addition, AI offerings ranging from chatbots to tools that can streamline the writing of reports require ever more computing power, and both Azure and Google Cloud are starting to offer new software applications to address those needs.

    Microsoft Chief Executive Satya Nadella called AI a “unique and different” factor that was helping Azure trends. “Given our leadership position, we are seeing complete new project starts, which are AI projects,” he said in response to an analyst question about the sustainability of cloud growth rates.

    In addition, Microsoft, which has invested heavily in ChatGPT-creator OpenAI, offers an Azure OpenAI service that more than 18,000 organizations are now using. Some of these customers are new to Azure.

    Microsoft Chief Financial Officer Amy Hood forecast that Azure revenue growth should be around 26% in constant currency in the fiscal second quarter, driven by new workload trends and with the growing contributions from AI.

    Investors seem less confident that Alphabet is seeing the same tailwinds in its Google Cloud business, especially as that segment showed its slowest quarterly growth since Google began breaking out results that way back in 2019. Cloud revenue of $8.4 billion, with growth of 22%, was $250 million shy of consensus estimates on Wall Street, according to Colin Sebastian, an analyst with Baird. That overshadowed an upbeat performance in the company’s advertising business.

    When one analyst asked Alphabet executives about the deceleration in the revenue growth of its cloud business, Chief Executive Sundar Pichai was vague but said that customers are being selective of where they are spending their IT budgets.

    “On cloud, what I would say is overall, we have definitely started seeing customers looking to optimize spend,” Pichai said. “We leaned into it to help customers, given some other challenges they were facing, and so that was a factor.”

    Alphabet is seeing “a lot of interest in AI,” but it remains to be seen whether that’s contributing materially to its financial performance just yet.

    “Google Cloud missed consensus revenue expectations (although in line with Baird) on slowing growth, and we believe consistent with the view that newer Gen-AI workloads will take time to move the needle,” Sebastian wrote in a note to clients.

    Insider Intelligence senior analyst Max Willens added that Google Cloud is facing tough competition, and while the business seems to have traction with AI startups that “may bear fruit in the long run, it is not currently helping Google Cloud enough to satisfy investors.”

    Wall Street clearly is looking to AI to fuel better growth rates and help offset sluggish macroeconomic trends. The poster child for that dynamic is Nvidia Corp.
    NVDA,
    +1.60%
    ,
    which is expected to single-handedly drive earnings growth for the information technology sector thanks to booming demand for its AI hardware.

    Read: Big-tech results will decide ‘where we go from here’ amid investor caution. They would fall if it weren’t for this one company

    Given economic pressures, it’s becoming obvious that companies without much of an AI story to contribute this quarter will continue to fall out of favor with investors.

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  • Microsoft Tops Estimates, Powered by Cloud Business

    Microsoft Tops Estimates, Powered by Cloud Business

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    Microsoft shares were trading higher after the company posted better-than-expected financial results for its September quarter, aided by better performance than expected from the company’s cloud computing business.

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  • Amazon, Microsoft Cloud Services Face UK Competition Probe

    Amazon, Microsoft Cloud Services Face UK Competition Probe

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    By Michael Susin

    The U.K.’s communications regulator has referred the cloud market to the country’s competition watchdog for an investigation, alleging that certain features by market leaders Amazon and Microsoft could limit competition.

    The Office of Communications regulator said Thursday that a market study found that high fees for transferring data, committed spend discounts and technical restrictions could make it difficult for customers to switch cloud provider or to use multiple providers.

    “Some U.K. businesses have told us they’re concerned about it being too difficult to switch or mix and match cloud provider, and it’s not clear that competition is working well. So, we’re referring the market to the [Competition and Markets Authority] for further scrutiny, to make sure business customers continue to benefit from cloud services,” Ofcom’s director responsible for the market study, Fergal Farragher, said.

    The regulator said Amazon Web Services (AWS) and Microsoft had a combined market share in the U.K. of 70% to 80% in 2022.

    The CMA will now start an independent investigation to decide whether there is an impact on competition.

    Neither Amazon nor Microsoft were immediately available for comment.

    Write to Michael Susin at michael.susin@wsj.com

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  • Instagram, other social media should be banned for anyone 16 and under, Ramaswamy says at GOP debate

    Instagram, other social media should be banned for anyone 16 and under, Ramaswamy says at GOP debate

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    Republican presidential hopeful Vivek Ramaswamy took aim at social-media companies during the second GOP presidential debate, saying Wednesday night that he would aim to ban anyone age 16 or under from using those companies’ platforms.

    “If you’re 16 years old or under, you should not be using an addictive social-media product — period,” said Ramaswamy, an entrepreneur who ranks fourth in GOP primary polls, according a RealClearPolitics average.

    He said this move would help with improving mental health and stopping the fentanyl epidemic. Earlier, Ramaswamy had talked about a mom and dad in Iowa whose son died after the teen bought Percocet laced with fentanyl through Snapchat.

    That type of ban would hit companies such as Meta Platforms
    META,
    -0.41%
    ,
    the parent of Instagram and Facebook; Snap
    SNAP,
    +1.80%
    ,
    the parent of Snapchat; X, formerly known as Twitter; and ByteDance, the Chinese parent of TikTok.

    Ramaswamy has started using TikTok in his White House campaign, and another GOP presidential candidate, former U.N. Ambassador Nikki Haley, attacked him over that at another point in the debate.

    “TikTok is one of the most dangerous social-media apps we could have,” she said. “Honestly, every time I hear you, I feel a little bit dumber.”

    Now read: Could Congress actually ban TikTok in the U.S.? Analysts see ‘procedural and practical hurdles’

    And see: GOP presidential debate: DeSantis says Trump’s spending ‘set the stage for the inflation that we have now’

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  • Micron sees nine-figure data-center sales in 2024, but another quarter of negative margins

    Micron sees nine-figure data-center sales in 2024, but another quarter of negative margins

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    Micron Technology Inc. is far from out of the woods yet when it comes to profitability as quarterly results came in better than expected Wednesday, but the memory-chip maker’s chief executive was upbeat about data-center sales in 2024 as AI fever rages on.

    While the Boise, Idaho-based chip maker topped expectations for its fiscal fourth quarter, it forecast a loss of $1.14 to $1 a share on revenue of $4.2 billion to $4.6 billion for the fiscal first quarter. Analysts surveyed by FactSet, however, had forecast, on average, a loss of 88 cents a share on revenue of $4.24 billion.

    Micron also expects negative gross margins for a fourth consecutive quarter in the fiscal first quarter, between a 6% and 2% loss, which Micron Chief Financial Officer Mark Murphy said on the call assumed no additional inventory write-down because of memory-chip pricing.

    Following gross margins of 22.9% reported in the first quarter of fiscal 2023, gross margins swung sharply to negative-31.4% as Micron reported its largest quarterly loss on record in March, writing off more than $1.4 billion in inventory. Those margins improved to negative-16.1% in the third quarter. On Wednesday, those continued to improve sequentially, to negative-9.1% in the fourth quarter.

    Additionally, the company said it is still experiencing headwinds from China’s cybersecurity review of the company’s products, which surfaced in March.

    Micron
    MU,
    +0.40%

    shares declined nearly 4% after hours Wednesday following a 0.4% rise to close the regular session at $68.21.

    On a conference call, Micron Chief Executive Sanjay Mehrotra told analysts he expects revenue from high-bandwidth memory chips designed for data centers “to begin in early 2024,” and that the company is “very much still on track for meaningful revenue, several hundred million dollars in our fiscal year 2024.”

    Back in July, Micron and Nvidia Corp.
    NVDA,
    +1.33%

    announced that Nvidia was using Micron’s HBM3 Gen2 high-bandwidth memory 1-beta DRAM chips in its AI data-center products. As the AI frenzy has raged on all year, data centers that must handle the enormous amounts of data and throughput required by AI models like Open AI’s ChatGPT, backed by Microsoft Corp.
    MSFT,
    +0.21%
    ,
    have boosted demand for hardware.

    Micron specializes in making DRAM and NAND memory chips. DRAM, or dynamic random access memory, is the type of memory commonly used in PCs and data-center servers, while NAND chips are the flash memory chips used in smaller devices like smartphones and USB drives.

    Read: Micron’s stock might be an excellent play for AI investors who want to diversify beyond Nvidia

    In the company’s last earnings report, Mehrotra called the bottom in the memory-chip market, but warned that smartphone and PC weakness could cut into AI gains. This time around, the CEO said smartphone and PC markets were “now at normal levels.”

    Read: AI will accelerate Micron’s recovery, analyst says

    For the fiscal fourth quarter, Micron reported a loss of $1.43 billion, or $1.31 a share, versus net income of $1.49 billion, or $1.35 a share, in the year-ago period.

    The adjusted loss, which excludes stock-based-compensation expenses and other items, was $1.07 a share, versus adjusted earnings of $1.45 a share in the year-ago period. Revenue fell to $4.01 billion from $6.64 billion in the year-ago quarter.

    Analysts had forecast Micron to report a fourth-quarter loss of $1.15 a share on revenue of $3.95 billion.

    Micron shares are up 36.5% year to date, compared with a 32.8% gain by the PHLX Semiconductor Index
    SOX,
    an 11.3% gain by the S&P 500 index
    SPX
    and a 25.1% rise in the Nasdaq Composite
    COMP.

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  • Hollywood writers strike declared over after boards approve new contract with studios

    Hollywood writers strike declared over after boards approve new contract with studios

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    LOS ANGELES — Leaders of the screenwriters union declared their nearly five-month-old strike over Tuesday after board members approved a contract agreement with studios, bringing Hollywood at least partly back from a historic halt in production.

    The governing boards of the eastern and western branches of the Writers Guild of America and their joint negotiating committee all voted to accept the deal, two days after the tentative agreement was reached with a coalition of Hollywood’s biggest studios, streaming services and production companies. After the vote they declared that the strike would be over and writers would be free to start on scripts at 12:01 a.m. Wednesday.

    Late-night talk shows — the first to go dark when writers walked out on May 2 — are likely the first shows that will resume. Scripted shows will take longer to return, with actors still on strike and no negotiations yet on the horizon.

    The writers still have to vote to ratify the contract themselves in early October, but lifting the strike will allow them to work during that process, the guild told members in an email.

    After Tuesday’s board votes, the contracts were released for the first time to the writers, who had not yet been given any details on the deal, which their leaders called “exceptional.”

    The three-year agreement includes significant wins in the main areas writers had fought for — compensation, length of employment, size of staffs and control of artificial intelligence — matching or nearly equaling what they had sought at the outset of the strike.

    The union had sought minimum increases in pay and future residual earnings from shows of between 5% and 6%, depending on the position of the writer. The studios had wanted between 2% and 4%. The compromise deal was a raise of between 3.5% and 5%.

    The guild also negotiated new residual payments based on the popularity of streaming shows, where writers will get bonuses for being a part of the most popular shows on Netflix
    NFLX,
    -1.44%
    ,
    Max and other services, a proposal studios initially rejected. Many writers on picket lines had complained that they weren’t properly paid for helping create heavily watched properties.

    The writers also got the requirement they sought that shows intended to run at least 13 episodes will have at least six writers on staff, with the numbers shifting based on the number of episodes. They did not get their desire for guaranteed staffs of six on shows that had not yet been ordered to series, settling instead for a guaranteed three.

    Writers also got a guarantee that staffs on shows in initial development will be employed for at least 10 weeks, and that staffs on shows that go to air will be employed for three weeks per episode.

    On artificial intelligence, the writers got the regulation and control of the emerging technology they had sought. Under the contract, raw, AI-generated storylines will not be regarded as “literary material” — a term in their contracts for scripts and other story forms a screenwriter produces. This means they won’t be competing with computers for screen credits. Nor will AI-generated stories be considered “source” material, their contractual language for the novels, video games or other works that writers may adapt into scripts.

    Writers have the right under the deal to use AI in their process if the company they are working for agrees and other conditions are met. But companies cannot require a writer to use AI.

    Still-striking members of the Screen Actors Guild-American Federation of Television and Radio Artists returned to the picket lines earlier Tuesday for the first time since the writers struck their tentative deal, and they were animated by a new spirit of optimism.

    “For a hot second, I really thought that this was going to go on until next year,” said Marissa Cuevas, an actor who has appeared on the TV series “Kung Fu” and “The Big Bang Theory.” “Knowing that at least one of us has gotten a good deal gives a lot of hope that we will also get a good deal.”

    Writers’ picket lines had been suspended, but they were encouraged to walk in solidarity with actors, and many were on the lines Tuesday, including “Mad Men” creator Matthew Weiner, who picketed alongside friend and “ER” actor Noah Wyle as he has throughout the strikes.

    “We would never have had the leverage we had if SAG had not gone out,” Weiner said. “They were very brave to do it.”

    The Alliance of Motion Picture and Television Producers, which represents the studios in negotiations, chose to deal with the longer-striking writers first, and leaders of SAG-AFTRA said they had received no overtures on resuming talks. That’s likely to change soon.

    Actors also voted to authorize their leadership to potentially expand their walkout to  include the lucrative videogame market, a step that could put new pressure on Hollywood studios to make a deal with the performers who provide voices and stunts for games.

    The Screen Actors Guild-American Federation of Radio and Television Artists announced the move late Monday, saying that 98% of its members voted to go on strike against videogame companies if ongoing negotiations are not successful. The announcement came ahead of more talks planned for Tuesday.

    Acting in videogames can include a variety of roles, from voice performances to motion capture work as well as stunts. Video game actors went on strike in 2016 in a work stoppage that lasted nearly a year.

    Some of the same issues are at play in the video game negotiations as in the broader actors strike that has shut down Hollywood for months, including wages, safety measures and protections on the use of artificial intelligence. The companies involved include gaming giants Activision Blizzard
    ATVI,
    -0.05%
    ,
    Electronic Arts
    EA,
    -1.13%
    ,
    Epic Games, Take 2 Productions
    TTWO,
    -0.99%

    as well as Disney
    DIS,
    -1.19%

    and Warner Bros.′
    WBD,
    +0.28%

    videogame divisions.

    “It’s time for the videogame companies to stop playing games and get serious about reaching an agreement on this contract,” SAG-AFTRA President Fran Drescher said in a statement.

    Audrey Cooling, a spokesperson for videogame producers, said they are “continuing to negotiate in good faith” and have reached tentative agreements on more than half of the proposals on the table.

    So far this year, U.S. consumers have spent $34.9 billion on videogames, consoles and accessories, according to market research group Circana.

    The threat of a videogame strike emerged as Hollywood writers were on the verge of getting back to work after months on the picket lines.

    The alliance of studios, streaming services and producers has chosen to negotiate only with the writers so far, and has made no overtures yet toward restarting talks with SAG-AFTRA. That will presumably change soon.

    SAG-AFTRA leaders have said they will look closely at the writers’ agreement, which includes many of the same issues, but it will not effect their demands.

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  • Intel Shares Slip as CFO Warns of Excess Data Center Chip Inventories

    Intel Shares Slip as CFO Warns of Excess Data Center Chip Inventories

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    Intel Stock Slips as CFO Warns of Excess Data Center Chip Inventories

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  • Oracle stock sinks as revenue outlook falls below Wall Street consensus

    Oracle stock sinks as revenue outlook falls below Wall Street consensus

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    Oracle Corp. shares dropped in extended trading Monday after the software company’s revenue forecast for the current quarter fell short of Wall Street expectations.

    Oracle
    ORCL,
    +0.31%

    shares, which had been down about 5% after hours when its earnings call started, dropped more than 9% after Oracle Chief Executive Safra Catz forecast its outlook for the quarter.

    On the conference call with analysts, Catz forecast second-quarter earnings of $1.30 to $1.34 a share on revenue growth of 5% to 7%, or $12.89 billion to $13.13 billion.

    Analysts surveyed by FactSet had estimated earnings of $1.34 a share on revenue of $13.28 billion.

    Catz added that if “currency exchange rates remain the same as they are now,” currency should have a 2% positive effect on total revenue and a 3 cent-a-share positive effect on earnings.

    Oracle reported fiscal first-quarter net income of $2.42 billion, or 86 cents a share, compared with $1.55 billion, or 56 cents a share, a year ago.

    Adjusted earnings, which exclude stock-based compensation expenses and other items, were $1.19 a share, compared with $1.03 a share in the year-ago period.

    Revenue rose to $12.45 billion from $11.45 billion in the year-ago quarter.

    Analysts surveyed by FactSet had forecast earnings of $1.15 a share on revenue of $12.57 billion.

    Oracle reported cloud services and license support revenue of $9.55 billion, while analysts, on average, had forecast $9.43 billion; and cloud license and on-premise license revenue of $809 million, while the Street expected $967 million.

    Hardware revenue came in at $714 million, while analysts expected $748 million; and services revenue was $1.38 billion, while the Street expected $1.43 billion.

    Oracle shares finished up 0.3% during Monday’s regular session to close at $126.71.

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  • Nvidia’s stock soars after AI boom pushes chip giant to record earnings and blowout forecast

    Nvidia’s stock soars after AI boom pushes chip giant to record earnings and blowout forecast

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    Nvidia Corp. shares rallied in the extended session Wednesday after the maker of graphics processing units that is leading the AI-hardware charge reported a 141% surge in data-center sales and record results.

    Nvidia
    NVDA,
    +3.17%

    shares rallied 9% after hours, following a 3.2% rise in the regular session to close at $471.16, less than 1% below the stock’s record closing high of $474.94, set on July 18, according to FactSet data. A close at such levels on Thursday would mean a new record high for the stock.

    The Santa Clara, Calif.-based company reported second-quarter net income of $6.19 billion, or $2.48 a share, compared with $656 million, or 26 cents a share, in the year-ago period. Adjusted earnings, which exclude stock-based compensation expenses and other items, were $2.70 a share, compared with 51 cents a share in the year-ago period.

    Revenue surged to a record $13.51 billion from $6.7 billion in the year-ago quarter, driven by a 141% leap in data-center revenue to $10.32 billion.

    Analysts surveyed by FactSet had forecast earnings of $2.08 a share on revenue of $11.19 billion, and data-center sales of $8.03 billion.

    Nvidia forecast third-quarter revenue of $15.68 billion to $16.32 billion.

    Analysts had estimated third-quarter earnings of $2.40 a share on revenue of $12.59 billion, with $9.15 billion of that from data-center sales. For the year, Wall Street, on average, expects earnings of $8.29 a share on $44.54 billion in revenue, a 71% increase from fiscal 2023’s $26.97 billion, with $32.41 billion of that in data-center sales.

    “Companies worldwide are transitioning from general-purpose to accelerated computing and generative AI,” said Jensen Huang, founder and chief executive of Nvidia, in a statement. “Leading enterprise IT system and software providers announced partnerships to bring Nvidia AI to every industry. The race is on to adopt generative AI.”

    Right after the report, Lopez Research analyst Maribel Lopez told MarketWatch that Nvidia’s “numbers prove just how much money there is in the AI hardware opportunity.”

    “While cloud companies are selling AI services, Nvidia is walking away with a bulk of the revenue and profits,” Lopez said. “Nvidia’s minting cash with no apparent slowdown in sight.”

     Nvidia shares are up more than 222% on a year-to-date basis, compared with a 42% surge in the PHLX Semiconductor Index
    SOX,
    a 15.5% rise by the S&P 500
    SPX
    and a 31% gain by the tech-heavy Nasdaq Composite
    COMP
    over the same span.

    Read: Will AI do to Nvidia what the dot-com boom did to Sun Microsystems? Analysts compare current hype to past ones.

    Nvidia, which has stood as the largest publicly traded chip maker by market cap since February, having traded that title back and forth with Taiwan Semiconductor Manufacturing Co.
    TSM,
    +2.15%

    since late 2020, closed above the $1 trillion mark officially for the first time on June 14. Nvidia ended Wednesday with a valuation of $1.164 trillion, and one analyst thinks it could be the most valuable U.S. company in a few years.

    Nvidia currently stands as the fifth-largest U.S. company by market cap behind Apple Inc.
    AAPL,
    +2.19%
    ,
    Microsoft Corp.
    MSFT,
    +1.41%
    ,
    Alphabet Inc.
    GOOG,
    +2.71%

    GOOGL,
    +2.55%

    and Amazon.com Inc.
    AMZN,
    +0.95%
    .
    While all have a big stake in the future of AI, the latter three companies are scrambling to outfit their cloud-service provider data centers with new AI gear amid tight supply.

    While Nvidia is considered the overwhelming leader in the AI chip market, Advanced Micro Devices Inc.
    AMD,
    +3.57%

    is considered a distant second. AMD’s data-center numbers declined in the company’s recent earnings report, although the company didn’t have comparable AI chip sales in its results.

    Shares of AMD and TSMC were both up more than 3% after hours Wednesday.

    See also: Nvidia ‘should have at least 90%’ of AI chip market with AMD on its heels

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  • The ‘stabilization’ of AWS may have been the most significant number for Amazon’s earnings

    The ‘stabilization’ of AWS may have been the most significant number for Amazon’s earnings

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    For weeks, Wall Street had been closely eyeing the performance of Amazon Web Services: Would it rise more than 10% in year-over-year sales?

    It did, and then some, on Thursday when Amazon.com Inc.
    AMZN,
    +0.55%

    announced its quarterly results, boosting company shares more than 9% in after-hours trading.

    Read more: Amazon beats expectations on domestic e-commerce sales, AWS; stock jumps

    Sales for Amazon’s market-leading AWS jumped 12%, to $22.1 billion, offering proof of its “stabilization” after several rough quarters, Jefferies analyst Brent Thill told CNBC late Thursday. More important, it signals healthier days — for now — in the cloud market amid a stampede for generative-AI services and concerns about Amazon’s place in it.

    “I am bullish on AWS’s growth,” Amazon Chief Executive Andy Jassy said in a conference call with analysts late Thursday, in which he predicted AWS would become a $100 billion business within several years.

    Last week, Microsoft Corp. 
    MSFT,
    -0.26%

    said it expected revenue growth from Azure and other cloud services to continue cooling in the current quarter. Meanwhile, Alphabet Inc.’s 
    GOOGL,
    +0.05%

    GOOG,
    +0.10%

    Google Cloud revenue grew 28%, topping Wall Street estimates.

    Maribel Lopez, founder and principal analyst at Lopez Research, called Amazon’s cloud revenue “surprising” and resilient despite cost optimization among enterprise buyers. “Upcoming AI workloads should keep [Amazon] in a similar top-line growth trajectory, but the challenge will be keeping the cost to serve down,” she said in an email. “The new chipsets will assist with cost containment. Overall, the AI business will provide a bright light in the cloud market.” 

    Although Thill and other analysts openly wonder how AWS will adapt in the age of AI, the company’s second-quarter sales figures heartened Amazon’s top boss, who knows a thing or two about the cloud-computing industry.

    “Our AWS growth stabilized as customers started shifting from cost optimization to new workload deployment, and AWS has continued to add to its meaningful leadership position in the cloud with a slew of generative AI releases that make it much easier and more cost-effective for companies to train and run models,” the embattled Jassy, who previously ran AWS, said in a statement Thursday, announcing the results.

    Underscoring the importance of AWS, it was mentioned 49 times in Amazon’s second-quarter earnings release, mostly cited in customer use cases.

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