ReportWire

Tag: Computing

  • This 6K Monitor Has More to Offer Than Just More Pixels

    The UltraFine 6K is also a Nano IPS Black display, which is something the Asus model is not. Nano IPS Black is actually a combination of two technologies that improve the image quality of IPS in different ways. Nano IPS enhances color coverage, while IPS Black cranks up the contrast. The combination of the two is pretty spectacular, especially on a monitor this sharp. It covers sRGB and AdobeRGB at a full 100 percent, something I’ve never seen on an IPS monitor before. The color accuracy is also incredibly strong. Right out of the box, I measured the average color error at a Delta-E of 0.62. Anything under 1.0 is considered excellent, even for professional color graders. No further calibration needed here.

    In terms of brightness, my review unit topped out at 480 nits in standard dynamic range (SDR), which is quite bright. The screen has an anti-reflective, matte coating that deters glare and reflections without dimming the screen too much. This is probably going to bother some people coming from a glossy, older LG 5K display. Although I’d also prefer a glossy display, LG’s solution is subtle enough. And while this is certainly not a proper HDR monitor in that it uses a conventional LED IPS panel, I was able to measure 640 nits of peak brightness in HDR. That’s far from what OLED or mini-LED can do. Remember: The HDR effect is created by higher brightness and contrast. That’s what makes OLED displays attractive. The UltraFine Evo 6K has a 2,000:1 contrast ratio, but I only got 1,720:1 in my testing. That’s still better than the average, though, as monitors like the Dell UltraSharp 32 4K use an enhanced IPS Black in order to push the contrast closer to 3,000:1.

    The refresh rate is the one big problem with the UltraFine Evo 6K’s picture. It’s only 60 Hz. It doesn’t matter how sharp, vibrant, and color-accurate your image is if the motion feels stiff. Even fairly affordable monitors like my favorite, the Dell 27 Plus 4K ($300), have a 120-Hz refresh rate. That’s likely not the fault of LG, as Asus’ 6K monitor is also stuck at 60 Hz—but it’s a current limitation of the resolution on offer. I have no doubt that future 6K monitors will come out with a 120-Hz refresh rate, but as of now, that’s a trade-off you’ll be making for the extra pixels.

    Pricey Proposition

    Photograph: Luke Larsen

    The LG UltraFine Evo 6K costs $2,000. While that’s not as much as Apple’s ridiculous Pro Display XDR, it also lacks the HDR capabilities that make that monitor special. The price feels especially egregious when you consider how cheap OLED monitors are getting. Dell’s first nongaming OLED, the Dell 32 Plus QD-OLED, is only $850 and is often on sale for under $700. It’s only 4K, but it’s better for both watching and producing HDR content.

    Lastly, if you’re set on 6K, there’s also the Asus ProArt PA32QCV to consider. I haven’t tested it yet, but it’s $600 cheaper than LG’s model, despite using the same 6K panel. What does that extra $700 buy you? A flashier design, for one, but also more up-to-date ports. Although I like where Asus has placed its ports better than LG, it uses old specs such as Thunderbolt 4 and DisplayPort 1.4. The biggest difference is the lack of Nano IPS Black, which means it likely doesn’t have the color performance and contrast of the LG model. These differences aren’t insignificant, but are they worth $700? That’s tough to say, especially since they are otherwise the identical panel. I can’t say for sure until I’ve tested Asus’ model, but on the surface, the LG UltraFine 6K does feel a little overpriced by comparison.

    On the other hand, if you’re already dropping this much cash on a 6K monitor, image quality is paramount, and the inclusion of Nano IPS Black makes the LG UltraFine 6K a better alternative to OLED or the Pro Display XDR.

    Luke Larsen

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  • The Gaza War Has Been Big Business for U.S. Companies

    Two years on, Israel’s war in Gaza might be finally drawing to a close. The conflict built an unprecedented arms pipeline from the U.S. to Israel that continues to flow, generating substantial business for big U.S. companies—including Boeing, Northrop Grumman and Caterpillar.

    Sales of U.S. weapons to Israel have surged since October 2023, with Washington approving more than $32 billion in armaments, ammunition and other equipment to the Israeli military over that time, according to a Wall Street Journal analysis of State Department disclosures.

    Copyright ©2025 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

    Benoit Faucon

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  • Exclusive | Trump Officials Torpedoed Nvidia’s Push to Export AI Chips to China

    Shortly before President Trump met Chinese leader Xi Jinping in South Korea, an urgent issue emerged. Trump wanted to discuss a request by Nvidia Chief Executive Jensen Huang to allow sales of a new generation of artificial-intelligence chips to China, current and former administration officials said.

    Greenlighting the export of Nvidia’s Blackwell chips would be a seismic policy shift potentially giving China, the U.S.’s biggest geopolitical competitor, a technological accelerant. Huang—who speaks to Trump often—has lobbied relentlessly to maintain access to the Chinese market.

    Copyright ©2025 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

    Lingling Wei

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  • Opinion | The Oct. 7 Warning for the U.S. on China

    Hamas’s shock troops poured across Israel’s border two years ago, kidnapping, raping and killing civilian men, women and children. Israel’s bitter experience offers lessons America should learn before our own moment of reckoning.

    The most important is that the hypothetical war can actually happen. Even if we’re intellectually prepared, there’s a risk that years of relative peace has lulled us into a false sense of security. The Israeli defense establishment never truly believed Hamas would launch a full-scale invasion. They viewed Gaza as a chronic but manageable problem—one for diplomats and intelligence officers, distant from the daily concerns of citizens. Israeli politicians and generals also spoke of open conflict with the Iran-led Islamist axis much like their American counterparts speak of China and a Taiwan crisis—the pacing threat and the most likely test, yes, but ultimately a question for tomorrow. Then tomorrow came.

    Copyright ©2025 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

    Mike Gallagher

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  • The $300 Billion A.I. Infrastructure Crisis Hiding in Plain Sight

    The A.I. boom depends on an infrastructure foundation that’s cracking under pressure. Observer Labs

    The race to scale artificial intelligence has triggered historic investment in GPU infrastructure. Hyperscalers are expected to spend over $300 billion on A.I. hardware in 2025 alone, while enterprises across industries are building their own GPU clusters to keep pace. This may be the largest corporate resource reallocation in modern history, yet beneath the headlines of record spending lies a quieter story. According to the 2024 State of AI Infrastructure at Scale report, most of this hardware goes underused, with more than 75 percent of organizations running their GPUs below 70 percent utilization, even at peak times. Wasted compute has become the silent tax on A.I. This inefficiency inflates costs and slows innovation, creating a competitive disadvantage for companies that should be leading their markets.

    The root cause traces to industrial-age thinking applied to information-age challenges. Traditional schedulers assign GPUs to jobs and keep them locked until completion—even when workloads shift to CPU-heavy phases. In practice, GPUs sit idle for long stretches while costs continue to mount. Studies suggest typical A.I. workflows spend between 30 percent to 50 percent of their runtime in CPU-only stages, meaning expensive GPUs contribute nothing during that period.

    Consider the economics: A single NVIDIA H100 GPU costs upward of $40,000. When static allocation leaves these resources idle even 25 percent of the time, organizations are essentially missing out on $10,000 worth of value per GPU annually on unused capacity. Scale that across enterprise A.I. deployments, and the waste reaches eight figures all too quickly.

    GPU underutilization creates cascading problems beyond pure cost inefficiency. When expensive infrastructure sits idle, research teams can’t experiment with new models, product teams struggle to iterate quickly on A.I. features, and competitive advantages slip away to more efficient rivals. Organizations then overbuy GPUs to cover peak loads, creating an arms race in hardware acquisition while existing resources remain underused. The result is artificial scarcity that drains budgets and slows progress. 

    The stakes extend beyond past budgets to global sustainability concerns, as the environmental cost is also mounting. A.I. infrastructure is projected double its consumption from 2024 levels, reaching 3 percent of global electricity by 2030. Companies that fail to maximize GPU efficiency will face rising bills as well as increased regulator scrutiny and stakeholder demands for measurable efficiency improvements.

    A new class of orchestration tools known as A.I. computing brokers offers a way forward. These systems monitor workloads in real time, dynamically reallocating GPU resources to match active demand. Instead of sitting idle, GPUs are reassigned during CPU-heavy phases to other jobs in the queue.

    Early deployments demonstrate the transformative potential of this approach, and the results are striking. In one deployment, Fujitsu’s AI Computing Broker (ACB) increased throughput in protein-folding simulations by 270 percent, allowing researchers to process nearly three times as many sequences on the same hardware. In another, enterprises running multiple large language models on shared infrastructure used ACB to consolidate workloads, enabling smooth inference across models while cutting infrastructure costs.

    These gains don’t require new hardware purchases or extensive code rewrites, but simply smarter orchestration that can turn existing infrastructure into a force multiplier.. Brokers integrate into existing A.I. pipelines and redistribute resources in the background, making GPUs more productive with minimal friction.

    Efficiency delivers more than cost savings. Teams that can run more experiments on the same infrastructure iterate faster, reach insights sooner and release products ahead of rivals stuck in static allocation models. Early adopters report efficiency gains between 150 percent and 300 percent, improvements that compound over time as experimentation velocity accelerates. That means organizations that once viewed GPU efficiency as a technical nice-to-have now face regulatory requirements, capital market pressures and competitive dynamics that make optimization mandatory rather than optional. 

    What began as operational optimization for tech-forward companies is rapidly becoming a strategic imperative across industries, with several specific trends driving this acceleration:

    • Regulatory pressure. European Union A.I. regulations increasingly require efficiency reporting, making GPU utilization a compliance consideration rather than just operational optimization.
    • Capital constraints. Rising interest rates make inefficient capital allocation more expensive, pushing CFOs to scrutinize infrastructure returns more closely.
    • Talent competition. Top A.I. researchers prefer organizations offering maximum compute access for experimentation, making efficient resource allocation a recruiting advantage.
    • Environmental mandates. Corporate sustainability commitments require measurable efficiency improvements, making GPU optimization strategically necessary rather than tactically useful.

    History shows that once efficiency tools become standard, the early adopters capture the outsized benefits. In other words: The opportunity window for competitive advantage through infrastructure efficiency remains open, but it won’t stay that way indefinitely. Companies that embrace smarter orchestration today will build faster, leaner and more competitive A.I. programs, while others remain trapped in outdated models. Static thinking produces static results, whereas dynamic thinking unlocks dynamic advantage. Similarly to how cloud computing displaced traditional data centers, the A.I. infrastructure race will be won by organizations that approach GPUs not as fixed assets but as dynamic resources to be optimized continuously.

    The $300 billion question isn’t how much organizations are investing in A.I. infrastructure. It’s how much value they’re actually extracting from what they’ve already built, and whether they’re moving fast enough to optimize before their competitors do.

    The $300 Billion A.I. Infrastructure Crisis Hiding in Plain Sight

    Indradeep Ghosh

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  • Sam Altman Says the GPT-5 Haters Got It All Wrong

    OpenAI’s August launch of its GPT-5 large language model was somewhat of a disaster. There were glitches during the livestream, with the model generating charts with obviously inaccurate numbers. In a Reddit AMA with OpenAI employees, users complained that the new model wasn’t friendly, and called for the company to restore the previous version. Most of all, critics griped that GPT-5 fell short of the stratospheric expectations that OpenAI has been juicing for years. Promised as a game changer, GPT-5 might have indeed played the game better. But it was still the same game.

    Skeptics seized on the moment to proclaim the end of the AI boom. Some even predicted the beginning of another AI Winter. “GPT-5 was the most hyped AI system of all time,” full-time bubble-popper Gary Marcus told me during his packed schedule of victory laps. “It was supposed to deliver two things, AGI and PhD-level cognition, and it didn’t deliver either of those.” What’s more, he says, the seemingly lackluster new model is proof that OpenAI’s ticket to AGI—massively scaling up data and chip sets to make its systems exponentially smarter—can no longer be punched. For once, Marcus’ views were echoed by a sizable portion of the AI community. In the days following launch, GPT-5 was looking like AI’s version of New Coke.

    Sam Altman isn’t having it. A month after the launch he strolls into a conference room at the company’s newish headquarters in San Francisco’s Mission Bay neighborhood, eager to explain to me and my colleague Kylie Robison that GPT-5 is everything that he’d been touting, and that all is well in his epic quest for AGI. “The vibes were kind of bad at launch,” he admits. “But now they’re great.” Yes, great. It’s true the criticism has died down. Indeed, the company’s recent release of a mind-bending tool to generate impressive AI video slop has diverted the narrative from the disappointing GPT-5 debut. The message from Altman, though, is that naysayers are on the wrong side of history. The journey to AGI, he insists, is still on track.

    Numbers Game

    Critics might see GPT-5 as the waning end of an AI summer, but Altman and team argue that it cements AI technology as an indispensable tutor, a search-engine-killing information source, and, especially, a sophisticated collaborator for scientists and coders. Altman claims that users are beginning to see it his way. “GPT-5 is the first time where people are, ‘Holy fuck. It’s doing this important piece of physics.’ Or a biologist is saying, ‘Wow, it just really helped me figure this thing out,’” he says. “There’s something important happening that did not happen with any pre-GPT-5 model, which is the beginning of AI helping accelerate the rate of discovering new science.” (OpenAI hasn’t cited who those physicists or biologists are.)

    So why the tepid initial reception? Altman and his team have sussed out several reasons. One, they say, is that since GPT-4 hit the streets, the company delivered versions that were themselves transformational, particularly the sophisticated reasoning modes they added. “The jump from 4 to 5 was bigger than the jump from 3 to 4,” Altman says. “We just had a lot of stuff along the way.” OpenAI president Greg Brockman agrees: “I’m not shocked that many people had that [underwhelmed] reaction, because we’ve been showing our hand.”

    OpenAI also says that since GPT-5 is optimized for specialized uses like doing science or coding, everyday users are taking a while to appreciate its virtues. “Most people are not physics researchers,” Altman observes. As Mark Chen, OpenAI’s head of research, explains it, unless you’re a math whiz yourself, you won’t care much that GPT-5 ranks in the top five of Math Olympians, whereas last year the system ranked in the top 200.

    As for the charge about how GPT-5 shows that scaling doesn’t work, OpenAI says that comes from a misunderstanding. Unlike previous models, GPT-5 didn’t get its major advances from a massively bigger dataset and tons more computation. The new model got its gains from reinforcement learning, a technique that relies on expert humans giving it feedback. Brockman says that OpenAI had developed its models to the point where they could produce their own data to power the reinforcement learning cycle. “When the model is dumb, all you want to do is train a bigger version of it,” he says. “When the model is smart, you want to sample from it. You want to train on its own data.”

    Steven Levy

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  • Parenting 101: 5 Lessons to keep kids safe online for the new school year

    The back-to-school season is exciting – new knowledge, new digital tools, and new discoveries. But it also brings higher cybersecurity risks for both schools and children. Cybersecurity experts are urging children, parents, and school communities to stay extra alert during this period.

    “The back-to-school period requires additional efforts to keep children and school communities safe online. A new beginning means new digital tools, online searches, and registrations for learning platforms. All of that increases cyber risks that must be taken seriously,” said Karolis Arbačiauskas, head of product at NordPass, in a media release

    A new study by NordPass, in collaboration with NordStellar, reveals a worrying truth: many educational institutions are still using shockingly weak passwords to protect sensitive data. Entries like “123456”, “Edifygroup@1”, and “principal@2021” appeared frequently, showing a widespread reliance on predictable or outdated credentials that are easy for hackers to guess.

    This is why the back-to-school season is the perfect moment to talk to children about cyber hygiene – the dos and don’ts in digital environments – and to help them build strong habits for digital security and privacy. “Learning about cybersecurity can be fun. Many families of cybersecurity professionals make it a game – they host a small party with snacks and guide their children through five simple but essential exercises,” said Arbačiauskas.

    Cybersecurity experts advise to take these steps to preserve your own cybersecurity and that of your family members (it can also be used as inspiration for your family’s Cyber Party):

    • Create strong and unique passwords. Make sure every account in your family – whether it’s yours, your parents’, your significant other’s, or your children’s – uses a strong and unique password. The easiest way to do it? Use a trusted password manager to generate, store, and share them securely.
    • Turn on multi-factor authentication (MFA). Add an extra layer of security wherever you can, especially to access school portals, email accounts, and social apps. MFA helps keep hackers out even if a password gets breached – and they get breached more often than you think. A recent study by NordPass revealed that many educational institutions still use shockingly weak passwords.
    • Update devices and apps. Keep phones, tablets, and laptops up to date with the latest software. Outdated apps can contain vulnerabilities that hackers take advantage of to get backdoor access into your device. Updates patch these security holes so that cybercriminals can no longer exploit them.
    • Talk about phishing. Discuss cybersecurity with your family and why it matters. Teach them to never click suspicious links or open unknown attachments – especially in emails or messages claiming to be from the school. When in doubt, verify with the sender by using a website checker.
    • Adjust privacy settings. Review and tighten privacy settings on social media, online games, and school platforms. Limit what personal info is publicly visible and who can contact your kids online.

    – JC

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  • President Trump says Intel agreed to give US a stake in its company

    President Donald Trump on Friday announced the U.S. government has secured a 10% stake in struggling Silicon Valley pioneer Intel in a deal that was completed just a couple weeks after he was depicting the company’s CEO as a conflicted leader unfit for the job.“The United States of America now fully owns and controls 10% of INTEL, a Great American Company that has an even more incredible future,” Trump wrote in a post.The U.S. government is getting the stake through the conversion of $11.1 billion in previously issued funds and pledges. All told, the government is getting 433.3 million shares of non-voting stock priced at $20.47 apiece — a discount from Friday’s closing price at $24.80. That spread means the U.S. government already has a gain of $1.9 billion, on paper.The remarkable turn of events makes the U.S. government one of Intel’s largest shareholders at a time that the Santa Clara, California, company is i n the process of jettisoning more than 20,000 workers as part of its latest attempt to bounce back from years of missteps taken under a variety of CEOs.Intel’s current CEO, Lip-Bu Tan, has only been on the job for slightly more than five months, and earlier this month, it looked like he might be on shaky ground already after some lawmakers raised national security concerns about his past investments in Chinese companies while he was a venture capitalist. Trump latched on to those concerns in an August 7 post demanding that Tan resign.But Trump backed off after the Malaysian-born Tan professed his allegiance to the U.S. in a public letter to Intel employees and went to the White House to meet with the president, leading to a deal that now has the U.S. government betting that the company is on the comeback trail after losing more than $22 billion since the end of 2023. Trump hailed Tan as “highly respected” CEO in his Friday post.In a statement, Tan applauded Trump for “driving historic investments in a vital industry” and resolved to reward his faith in Intel. “We are grateful for the confidence the President and the Administration have placed in Intel, and we look forward to working to advance U.S. technology and manufacturing leadership,” Tan said.Intel’s current stock price is just slightly above where it was when Tan was hired in March and more than 60% below its peak of about $75 reached 25 years ago when its chips were still dominating the personal computer boom before being undercut by a shift to smartphones a few years later. The company’s market value currently stands at about $108 billion – a fraction of the current chip kingpin, Nvidia, which is valued at $4.3 trillion.The stake is coming primarily through U.S. government grants to Intel through the CHIPS and Science Act that was started under President Joe Biden’s administration as a way to foster more domestic manufacturing of computer chips to lessen the dependence on overseas factories.But the Trump administration, which has regularly pilloried the policies of the Biden administration, saw the CHIPs act as a needless giveaway and is now hoping to make a profit off the funding that had been pledged to Intel.”We think America should get the benefit of the bargain,” U.S. Commerce Secretary Howard Lutnick said earlier this week. “It’s obvious that it’s the right move to make.”About $7.8 billion had been been pledged to Intel under the incentives program, but only $2.2 billion had been funded so far. Another $3.2 billion of the government investment is coming through the funds from another program called “Secure Enclave.”Although U.S. government can’t vote with its shares and won’t have a seat on Intel’s board of directors, critics of the deal view it as a troubling cross-pollination between the public and private sectors that could hurt the tech industry in a variety of ways.For instance, more tech companies may feel pressured to buy potentially inferior chips from Intel to curry favor with Trump at a time that he is already waging a trade war that threatens to affect their products in a potential scenario cited by Scott Lincicome, vice president of general economics for the Cato Institute.“Overall, it’s a horrendous move that will have real harms for U.S. companies, U.S. tech leadership, and the U.S. economy overall,” Lincicome posted Friday.The 10% stake could also intensify the pressure already facing Tan, especially if Trump starts fixating on Intel’s stock price while resorting to his penchant for celebrating his past successes in business.Nancy Tengler, CEO of money manager Laffer Tengler Investments, is among the investors who abandoned Intel years ago because of all the challenges facing Intel.“I don’t see the benefit to the American taxpayer, nor do I see the benefit, necessarily to the chip industry,” Tengler said while also raising worries about Trump meddling in Intel’s business.“I don’t care how good of businessman you are, give it to the private sector and let people like me be the critic and let the government get to the business of government.,” Tengler said.Although rare, it’s not unprecedented for the U.S. government to become a significant shareholder in a prominent company. One of the most notable instances occurred during the Great Recession in 2008 when the government injected nearly $50 billion into General Motors in return for a roughly 60% stake in the automaker at a time it was on the verge of bankruptcy. The government ended up with a roughly $10 billion loss after it sold its stock in GM.The U.S. government’s stake in Intel coincides with Trump’s push to bring production to the U.S., which has been a focal point of the trade war that he has been waging throughout the world. By lessening the country’s dependence on chips manufactured overseas, the president believes the U.S. will be better positioned to maintain its technological lead on China in the race to create artificial intelligence.Even before gaining the 10% stake in Intel, Trump had been leveraging his power to reprogram the operations of major computer chip companies. The administration is requiring Nvidia and Advanced Micro Devices, two companies whose chips are powering the AI craze, to pay a 15% commission on their sales of chips in China in exchange for export licenses.

    President Donald Trump on Friday announced the U.S. government has secured a 10% stake in struggling Silicon Valley pioneer Intel in a deal that was completed just a couple weeks after he was depicting the company’s CEO as a conflicted leader unfit for the job.

    “The United States of America now fully owns and controls 10% of INTEL, a Great American Company that has an even more incredible future,” Trump wrote in a post.

    The U.S. government is getting the stake through the conversion of $11.1 billion in previously issued funds and pledges. All told, the government is getting 433.3 million shares of non-voting stock priced at $20.47 apiece — a discount from Friday’s closing price at $24.80. That spread means the U.S. government already has a gain of $1.9 billion, on paper.

    The remarkable turn of events makes the U.S. government one of Intel’s largest shareholders at a time that the Santa Clara, California, company is i n the process of jettisoning more than 20,000 workers as part of its latest attempt to bounce back from years of missteps taken under a variety of CEOs.

    Intel’s current CEO, Lip-Bu Tan, has only been on the job for slightly more than five months, and earlier this month, it looked like he might be on shaky ground already after some lawmakers raised national security concerns about his past investments in Chinese companies while he was a venture capitalist. Trump latched on to those concerns in an August 7 post demanding that Tan resign.

    But Trump backed off after the Malaysian-born Tan professed his allegiance to the U.S. in a public letter to Intel employees and went to the White House to meet with the president, leading to a deal that now has the U.S. government betting that the company is on the comeback trail after losing more than $22 billion since the end of 2023. Trump hailed Tan as “highly respected” CEO in his Friday post.

    In a statement, Tan applauded Trump for “driving historic investments in a vital industry” and resolved to reward his faith in Intel. “We are grateful for the confidence the President and the Administration have placed in Intel, and we look forward to working to advance U.S. technology and manufacturing leadership,” Tan said.

    Intel’s current stock price is just slightly above where it was when Tan was hired in March and more than 60% below its peak of about $75 reached 25 years ago when its chips were still dominating the personal computer boom before being undercut by a shift to smartphones a few years later. The company’s market value currently stands at about $108 billion – a fraction of the current chip kingpin, Nvidia, which is valued at $4.3 trillion.

    The stake is coming primarily through U.S. government grants to Intel through the CHIPS and Science Act that was started under President Joe Biden’s administration as a way to foster more domestic manufacturing of computer chips to lessen the dependence on overseas factories.

    But the Trump administration, which has regularly pilloried the policies of the Biden administration, saw the CHIPs act as a needless giveaway and is now hoping to make a profit off the funding that had been pledged to Intel.

    “We think America should get the benefit of the bargain,” U.S. Commerce Secretary Howard Lutnick said earlier this week. “It’s obvious that it’s the right move to make.”

    About $7.8 billion had been been pledged to Intel under the incentives program, but only $2.2 billion had been funded so far. Another $3.2 billion of the government investment is coming through the funds from another program called “Secure Enclave.”

    Although U.S. government can’t vote with its shares and won’t have a seat on Intel’s board of directors, critics of the deal view it as a troubling cross-pollination between the public and private sectors that could hurt the tech industry in a variety of ways.

    For instance, more tech companies may feel pressured to buy potentially inferior chips from Intel to curry favor with Trump at a time that he is already waging a trade war that threatens to affect their products in a potential scenario cited by Scott Lincicome, vice president of general economics for the Cato Institute.

    “Overall, it’s a horrendous move that will have real harms for U.S. companies, U.S. tech leadership, and the U.S. economy overall,” Lincicome posted Friday.

    The 10% stake could also intensify the pressure already facing Tan, especially if Trump starts fixating on Intel’s stock price while resorting to his penchant for celebrating his past successes in business.

    Nancy Tengler, CEO of money manager Laffer Tengler Investments, is among the investors who abandoned Intel years ago because of all the challenges facing Intel.

    “I don’t see the benefit to the American taxpayer, nor do I see the benefit, necessarily to the chip industry,” Tengler said while also raising worries about Trump meddling in Intel’s business.

    “I don’t care how good of businessman you are, give it to the private sector and let people like me be the critic and let the government get to the business of government.,” Tengler said.

    Although rare, it’s not unprecedented for the U.S. government to become a significant shareholder in a prominent company. One of the most notable instances occurred during the Great Recession in 2008 when the government injected nearly $50 billion into General Motors in return for a roughly 60% stake in the automaker at a time it was on the verge of bankruptcy. The government ended up with a roughly $10 billion loss after it sold its stock in GM.

    The U.S. government’s stake in Intel coincides with Trump’s push to bring production to the U.S., which has been a focal point of the trade war that he has been waging throughout the world. By lessening the country’s dependence on chips manufactured overseas, the president believes the U.S. will be better positioned to maintain its technological lead on China in the race to create artificial intelligence.

    Even before gaining the 10% stake in Intel, Trump had been leveraging his power to reprogram the operations of major computer chip companies. The administration is requiring Nvidia and Advanced Micro Devices, two companies whose chips are powering the AI craze, to pay a 15% commission on their sales of chips in China in exchange for export licenses.

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  • The best budget laptops for 2024

    The best budget laptops for 2024

    Finding the perfect laptop without breaking the bank isn’t as hard as you might think. These days, the best cheap laptops still pack a lot of punch, offering great features without a premium price tag. Whether you need a laptop for work, school, streaming or just staying connected, there are plenty of affordable options that can handle your everyday needs. You don’t have to settle for outdated tech, either — many budget laptops now come with decent processors, long battery life and even sleek designs that won’t cramp your style.

    Of course, not all budget laptops are created equal. That’s why we’ve rounded up the top picks to help you get the most value for your money. From student-friendly Chromebooks to Windows laptops for light productivity, there’s something for everyone.

    First, we at Engadget consider anything under $1,000 to be “budget” in the laptop space. The reason for this is twofold: even the most affordable flagship laptops typically start at $1,000 or more, and if you go dramatically lower than that (say, $500 or less), that’s where you’ll really start to see compromises in performance. You’ll typically find the best cheap laptops striking a good balance between power and price in the $500 to $1,000 range. But in this guide, we’ll cover top picks at a wide range of prices — there are a number of excellent options on the low and high end of the budget spectrum.

    Arguably the biggest thing to look for in a cheap laptop is build quality and a decent spec sheet. You might be able to find configuration options with the latest generation CPU chipsets, or you may have to go for one that has a slightly older processor. We recommend looking for models with solid state drive (SSD) storage instead of a traditional hard drive, as SSDs provide faster performance. And if you can find a PC with the latest internals, it’s worth the investment. However, going with a CPU that’s just one generation behind likely won’t make a noticeable difference in performance.

    Along with processors, you should also consider the amount of memory and storage you need in a daily driver. For the former, we recommend laptops with at least 8GB of RAM; anything with less than that will have a hard time multitasking and managing all those web browsing tabs. The latter is a bit more personal: how much onboard storage you need really depends on how many apps, files, photos, documents and more you will save locally. As a general rule of thumb, try to go for a laptop that has at least a 256GB SSD (this only goes for macOS and Windows machines, as Chromebooks are a bit different). That should give you enough space for programs and files, plus room for future operating system updates. And if you need a machine for light productivity or Android emulation, some laptops even support Android apps natively, which can add extra versatility.

    After determining the best performance you can get while sticking to your budget, it’s also worth examining a few different design aspects. We recommend a laptop with an IPS display for better viewing angles and color accuracy, though premium models with OLED displays are becoming more common and can offer deeper blacks and vibrant colors. Pay attention to port selection, too — many budget models offer plenty of ports, while higher-end ones tend to prioritize minimalism with fewer connections. If connectivity matters to you, look for options with USB-C, USB-A, HDMI and an audio jack.

    And speaking of practical features, keep an eye on GPU performance if you’re shopping for a budget-friendly gaming laptop. While integrated graphics are fine for casual users, a dedicated GPU will improve gaming and creative workloads. We also recommend checking the refresh rate of the screen, as a higher rate will make a noticeable difference in both games and scrolling-heavy apps.

    Refurbished laptops are another option to consider if you need a new machine and don’t want to spend a ton of money. Buying refurbished tech can be tricky if you’re unfamiliar with a brand’s or merchant’s policies surrounding what they classify as “refurbished.” But it’s not impossible — for laptops, we recommend going directly to the manufacturer for refurbished devices. Apple, Dell and Microsoft all have official refurbishment processes that their devices go through before they’re put back on the market that verifies the machines work properly and are in good condition. Third-party retailers like Amazon and Walmart also have their own refurbishment programs for laptops and other gadgets as well.

    Photo by Devindra Hardawar / Engadget

    Screen size: 13.6-inch | Touchscreen: No | CPU: Apple M2 | GPU: 8-core GPU | RAM: 8GB | Storage: 256GB | Weight: 2.7 pounds | Battery life: Up to 17 hours | Available ports: MagSafe 3 charging, 3.5mm headphone jack, 2x Thunderbolt 4

    Read our full review of the Apple MacBook Air M2

    The launch of the M3 MacBook Air saw the retirement of the first Air with an M-series chipset. Apple’s no longer officially selling the M1 MacBook Air (although you can still find it at other retailers right now), but it knocked down the starting price of the M2 Air to $999. The M3 MacBook Air is the best Windows alternative for those in search of a thin and light laptop, but the M2 is an unmatched value for those on a budget. In our battery test, the M2 performed remarkably well, delivering good battery life comparable to that of the newer M3 model. The biggest differences between them are that the M3 models support Wi-Fi 6E and driving to up to two external displays when the lid is closed.

    So when it comes to buying a new laptop and spending only $1,000 or less, the MacBook Air M2 is the notebook we’d recommend to most people. Not only do you get the updated Air design that’s thinner and more squared-off than before, but you also get a gorgeous 13.6-inch display, a solid quad-speaker array and, most importantly, stellar performance thanks to the M2 chip. For tasks personal and professional, this MacBook Air should have more than enough power and speed for most people (we’d even recommend it over the 13-inch MacBook Pro for many). For under $1,000, the MacBook Air M2 offers excellent value with a sleek design, plenty of ports, and the powerful M2 chip. The fact that it’s now $200 less than before simply because it’s changed places in Apple’s lineup presents a great opportunity for those in need of a new daily driver to get our previous top pick for best laptop at its new low price.

    Pros

    • Thin and light design
    • Gorgeous 13.6-inch screen
    • Great quad-speaker setup
    • Excellent M2 performance
    Cons

    • No ProMotion
    • Some speed throttling for extended tasks

    $899 at Amazon

    Photo by Daniel Cooper / Engadget

    Screen size: 13-inch | Touchscreen: No | CPU: AMD Ryzen 5 | GPU: AMD Radeon™ Graphics | RAM: 16GB | Storage: 256GB | Weight: 2.2 pounds | Battery life: Up to 12 hours | Available ports: 2x USB Type-C, 2x USB Type-A, HDMI 2.1, 3.5mm headphone jack

    Read our full review of the HP Pavilion Aero 13

    If you like the general aesthetics of machines like Dell’s XPS 13 but don’t want to pay $1,000 or more, the HP Pavilion Aero is your best bet. We gave it a score of 87 in our review and compared it to Dell’s flagship laptop. It’s certainly not as sleek as that machine, but it comes pretty close with its angled profile, 2.2-pound weight and its anti-glare 13.3-inch display. Despite its keyboard being a little cramped, it’s a solid typing machine and we appreciate its port selection: one USB-C port, two USB-A ports, an HDMI connector and a headphone jack. You can currently pick an Aero 13 up for as low as $900, but they have gone on sale for even less. All of the prebuilt base models available from HP directly come with Ryzen 5 processors, and you can customize the laptop to have up to a Ryzen 7 CPU, 16GB of RAM and a 1TB SSD.

    Pros

    • Attractive design
    • Many ports
    • Solid performance for the price

    $880 at HP

    Photo by Nathan Ingraham / Engadget

    Display: 14 inches FHD | CPU: 13th-generation Intel Core i3 | GPU: Intel UHD Graphics | RAM: Up to 8GB | Storage: 128GB | Weight: 3.52 lb (1.6 kg) | Available ports: 2x USB 3.2 Gen 2 Type-C, USB 3.2 Gen 1 Type-A, 3.5mm headphone jack

    Our favorite Chromebook is Lenovo’s Flex 5 Chromebook, which nails the essentials with build quality that feels more premium than its price suggests. Engadget’s Nathan Ingraham praised the Flex 5 for offering tremendous value. The 14-inch touchscreen and backlit keyboard are great additions for those who multitask or use Android apps. The latest model has an upgraded 8GB of RAM and 128GB of storage, which when paired with the Core i3 CPU, make for a speedy, capable machine. It’s also nice to see one USB-A and two USB-C ports, six hours of battery life and a 360-degree hinge that makes it easy to use the Flex 5 as a tablet. This could be the ideal laptop for Chrome OS fans who spend a lot of time web browsing, and it’ll hit the sweet spot for a lot of other buyers out there, providing a level of quality and performance that’s pretty rare to find at this price point.

    Pros

    • Great overall performance for the price
    • Nice display
    • Solid keyboard and trackpad
    Cons

    • Mediocre battery life
    • A bit heavy and chunky

    $479 at Amazon

    acer

    Screen size: 15-inch | Touchscreen: No | CPU: 11th-gen Intel Core i3 | GPU: Intel UHD Graphics | RAM: 8GB | Storage: 128GB | Weight: 3.64 pounds | Battery life: Up to 10 hours | Available ports: USB, USB Type C, Ethernet, HDMI, USB 2.0

    Acer’s Aspire 5 family is a solid Windows option if you have less than $500 to spend on a new laptop, offering solid everyday performance and plenty of ports. The most recent models hit a good middle ground for most people, running on Intel 11th-gen CPUs and supporting up to 16GB of RAM and up to 512GB of storage. Of course, the higher specs you get, the more expensive the machine will be — not all Aspire 5 laptops come in at under $500. The Aspire 5 comes with a 15.6-inch 1080p IPS display, which delivers clear visuals for streaming or web browsing. The number pad is a handy addition for productivity, and the port selection includes USB-A, USB-C, and Ethernet ports, making it a practical choice for those who need to connect multiple devices. Acer’s latest models also feature Wi-Fi 6 for faster connectivity, and our battery test confirmed up to 10 hours of good battery life—more than enough for a day’s work or entertainment.

    Pros

    • Ultra affordable
    • Good performance for the price
    • Keyboard includes number pad
    • Good variety of ports

    $335 at Amazon

    Valentina Palladino

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  • Salem students ‘lead the way’ at robotics showcase

    Salem students ‘lead the way’ at robotics showcase

    SALEM — Collins Middle School seventh-grade robotics students Amelia Meegan and Sam Vietzke captured the Middle School Project Lead the Way Division at the One8 Applied Learning Showcase Friday, May 10, at the Track at New Balance.

    The feat was especially meaningful since the school’s entry into the One8 Showcase, spearheaded by science educator/Robotics Club advisor Gregg Beach, was its first-ever appearance.

    “I just thought it was important that we showed up,” said Beach in a news release. “The process of building, doing the work and showing up was reward enough. I’m not surprised (that we won) because we have so many great students and projects in this school.”

    The One8 Showcase, which included more than 300 schools, is a year-end student STEM showcase for Project Lead The Way, OpenSciEd, PBLWorks, and ST Math schools in Massachusetts for students in grades 5-12. Students shared their applied learning projects with industry professionals and had an opportunity to present to an audience.

    Student teams each had a table and display board on which they described their projects as industry professionals circulated and engaged students, offering verbal and written feedback.

    The Salem robotics students received commemorative One8 Showcase jackets as well as an invitation to the Philips Research Institute in Cambridge for a field trip.

    Amelia and Sam presented their robot MrukBot 9000, named after their beloved assistant principal Shamus Mruk, which was capable of 360 turns and was equipped with a bluetooth speaker, comically playing loops of Mruk’s favorite lines:

    – “What are you doing here?”

    – “Are you supposed to be here?”

    – “Where’s your pass?”

    – “Get back to class!”

    According to Sam, Amelia builds while he codes. “It took me about two days to code,” he said. “We know there were going to be other robots, but we were actually one of very few.”

    Success at the One8 Showcase has inspired the two to keep tweaking the MrukBot 9000.

    “Our next step is to put a camera on it so we can watch a live feed, basically making it a Roomba,” said Amelia.

    “We want to install an AI vision sensor,” Sam added, something Beach plans to introduce to his robotics class and the after-school Robotics Club.

    Beach noted that Amelia and Sam are also both drama students, which was key to their presentation.

    Seventh-grader Edward Castillo Mesa also attended the One8 Showcase to present his robot, EndGame Chupacabra 3.1, named after the mythical Mexican creature, which he built to battle other robots.

    His robot earned “terrific” feedback from several industry professionals in attendance and he has designs on a new project for the 2025 One8 Showcase: A robot to locate lost hikers.

    “I want to build something that can actually help people,” he said.

    By News Staff

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  • Never-Repeating Patterns of Tiles Can Safeguard Quantum Information

    Never-Repeating Patterns of Tiles Can Safeguard Quantum Information

    This extreme fragility might make quantum computing sound hopeless. But in 1995, the applied mathematician Peter Shor discovered a clever way to store quantum information. His encoding had two key properties. First, it could tolerate errors that only affected individual qubits. Second, it came with a procedure for correcting errors as they occurred, preventing them from piling up and derailing a computation. Shor’s discovery was the first example of a quantum error-correcting code, and its two key properties are the defining features of all such codes.

    The first property stems from a simple principle: Secret information is less vulnerable when it’s divided up. Spy networks employ a similar strategy. Each spy knows very little about the network as a whole, so the organization remains safe even if any individual is captured. But quantum error-correcting codes take this logic to the extreme. In a quantum spy network, no single spy would know anything at all, yet together they’d know a lot.

    Each quantum error-correcting code is a specific recipe for distributing quantum information across many qubits in a collective superposition state. This procedure effectively transforms a cluster of physical qubits into a single virtual qubit. Repeat the process many times with a large array of qubits, and you’ll get many virtual qubits that you can use to perform computations.

    The physical qubits that make up each virtual qubit are like those oblivious quantum spies. Measure any one of them and you’ll learn nothing about the state of the virtual qubit it’s a part of—a property called local indistinguishability. Since each physical qubit encodes no information, errors in single qubits won’t ruin a computation. The information that matters is somehow everywhere, yet nowhere in particular.

    “You can’t pin it down to any individual qubit,” Cubitt said.

    All quantum error-correcting codes can absorb at least one error without any effect on the encoded information, but they will all eventually succumb as errors accumulate. That’s where the second property of quantum error-correcting codes kicks in—the actual error correction. This is closely related to local indistinguishability: Because errors in individual qubits don’t destroy any information, it’s always possible to reverse any error using established procedures specific to each code.

    Taken for a Ride

    Zhi Li, a postdoc at the Perimeter Institute for Theoretical Physics in Waterloo, Canada, was well versed in the theory of quantum error correction. But the subject was far from his mind when he struck up a conversation with his colleague Latham Boyle. It was the fall of 2022, and the two physicists were on an evening shuttle from Waterloo to Toronto. Boyle, an expert in aperiodic tilings who lived in Toronto at the time and is now at the University of Edinburgh, was a familiar face on those shuttle rides, which often got stuck in heavy traffic.

    “Normally they could be very miserable,” Boyle said. “This was like the greatest one of all time.”

    Before that fateful evening, Li and Boyle knew of each other’s work, but their research areas didn’t directly overlap, and they’d never had a one-on-one conversation. But like countless researchers in unrelated fields, Li was curious about aperiodic tilings. “It’s very hard to be not interested,” he said.

    Ben Brubaker

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  • As Nvidia prepares to post results, these three Europe chip names are tipped for gains, JPMorgan says

    As Nvidia prepares to post results, these three Europe chip names are tipped for gains, JPMorgan says

    As Nvidia prepares to publish its much-anticipated full-year results this Wednesday, analysts at JPMorgan say VAT Group, ASML Holding, and ASM International all offer the strongest prospects for investors seeking to cash in on an upturn in the market for microchips. 

    JPMorgan analysts led by Sandeep Deshpande explained that while the slump in the microchip market is now showing signs of improvement, certain segments of the market — including those that supply chips to the auto and industrial sectors — are improving more slowly than others.

    The market for memory chips is, meanwhile, giving off signals of a bumper recovery, with inventory levels for the microchips used in computer storage devices currently sitting at lower than average seasonal levels, they said in a note to clients that published Monday. 

    As such, those Europe-based semiconductor companies least exposed to the autos and industrial sectors, which have the highest exposure to the market for memory chips, are set to see the biggest benefits in the near term, said Deshpande and the team.

    Swiss company VAT Group
    VACN,
    +0.37%
    makes vacuum valves used in chip manufacturing, while Dutch firms ASML Holding
    ASML,
    -0.10%

    ASML,
    -1.73%
    and ASM International
    ASM,
    -2.13%
    both make the lithography machines used to manufacture semiconductors. 

    Shares in all three European companies are up significantly over the previous 12 months — VAT has gained 51%, ASML 43% and ASM 81%.

    Notably, all three European companies are all focused on making the equipment used to manufacture the advanced microchips used in electronic products, including smartphones and personal computers. In JPMorgan’s view, this puts them in an advantageous position to benefit from any recovery. 

    At the same time, those companies most exposed to the auto and tech industries, including German firm Infineon Technologies AG
    IFX,
    -0.96%
    and Swiss firm STMicroelectronics
    STM,
    -0.29%    ,
    are set to continue trading at subdued levels — despite already being cheap — as the market remains challenging, they caution.

    Deshpande and the team noted that inventory levels for the chips used in the auto and industrial sectors currently sit at rates 38.7% higher than three-year seasonal averages in the fourth-quarter of 2023, marking a deterioration on the 31.1% rate in the third quarter of 2023.

    In contrast, inventory levels for memory chips improved significantly in the final three months of 2023, having fallen from rates 19% above seasonal averages in the third quarter to rates 1.7% below normal seasonal levels at the end of the fourth quarter of last year.

    For reference, ASML Holding, which was previously split off from ASM International in 1984 through a joint venture with Philips
    PHIA,
    -0.32%    ,
    is currently the world’s sole manufacturer of the extreme ultraviolet lithography machines used to make the advanced chips used in the AI industry. 

    ASM International continues to design the wafer processing machines used to make microchips. VAT Group produces vacuum valves that are needed to manufacture high tech chips in sterile environments to ensure they are not exposed to outside particles.  

    Nvidia
    NVDA,
    -0.06%    ,
    the world’s largest chip designer, will on Wednesday announce quarterly results, which investors are expected to pore over, seeking vital clues on the health of the global chip market amid much excitement around a possible AI driven boom. 

    Read: Nvidia’s earnings report could kill the momentum driving U.S. stocks higher, regardless of how it turns out.

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  • A Celebrated Cryptography-Breaking Algorithm Just Got an Upgrade

    A Celebrated Cryptography-Breaking Algorithm Just Got an Upgrade


    This is a job for LLL: Give it (or its brethren) a basis of a multidimensional lattice, and it’ll spit out a better one. This process is known as lattice basis reduction.

    What does this all have to do with cryptography? It turns out that the task of breaking a cryptographic system can, in some cases, be recast as another problem: finding a relatively short vector in a lattice. And sometimes, that vector can be plucked from the reduced basis generated by an LLL-style algorithm. This strategy has helped researchers topple systems that, on the surface, appear to have little to do with lattices.

    In a theoretical sense, the original LLL algorithm runs quickly: The time it takes to run doesn’t scale exponentially with the size of the input—that is, the dimension of the lattice and the size (in bits) of the numbers in the basis vectors. But it does increase as a polynomial function, and “if you actually want to do it, polynomial time is not always so feasible,” said Léo Ducas, a cryptographer at the national research institute CWI in the Netherlands.

    In practice, this means that the original LLL algorithm can’t handle inputs that are too large. “Mathematicians and cryptographers wanted the ability to do more,” said Keegan Ryan, a doctoral student at the University of California, San Diego. Researchers worked to optimize LLL-style algorithms to accommodate bigger inputs, often achieving good performance. Still, some tasks have remained stubbornly out of reach.

    The new paper, authored by Ryan and his adviser, Nadia Heninger, combines multiple strategies to improve the efficiency of its LLL-style algorithm. For one thing, the technique uses a recursive structure that breaks the task down into smaller chunks. For another, the algorithm carefully manages the precision of the numbers involved, finding a balance between speed and a correct result. The new work makes it feasible for researchers to reduce the bases of lattices with thousands of dimensions.

    Past work has followed a similar approach: A 2021 paper also combines recursion and precision management to make quick work of large lattices, but it worked only for specific kinds of lattices, and not all the ones that are important in cryptography. The new algorithm behaves well on a much broader range. “I’m really happy someone did it,” said Thomas Espitau, a cryptography researcher at the company PQShield and an author of the 2021 version. His team’s work offered a “proof of concept,” he said; the new result shows that “you can do very fast lattice reduction in a sound way.”

    The new technique has already started to prove useful. Aurel Page, a mathematician with the French national research institute Inria, said that he and his team have put an adaptation of the algorithm to work on some computational number theory tasks.

    LLL-style algorithms can also play a role in research related to lattice-based cryptography systems designed to remain secure even in a future with powerful quantum computers. They don’t pose a threat to such systems, since taking them down requires finding shorter vectors than these algorithms can achieve. But the best attacks researchers know of use an LLL-style algorithm as a “basic building block,” said Wessel van Woerden, a cryptographer at the University of Bordeaux. In practical experiments to study these attacks, that building block can slow everything down. Using the new tool, researchers may be able to expand the range of experiments they can run on the attack algorithms, offering a clearer picture of how they perform.

    Original story reprinted with permission from Quanta Magazine, an editorially independent publication of the Simons Foundation whose mission is to enhance public understanding of science by covering research developments and trends in mathematics and the physical and life sciences.



    Madison Goldberg

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  • Amazon’s stock just racked up its highest close in more than two years

    Amazon’s stock just racked up its highest close in more than two years


    Amazon.com Inc. shares continued their charge higher Friday, securing their highest close in more than two years.

    The e-commerce giant’s stock advanced 2.7% in Friday’s session to finish the day at $174.45. That was the best ending level since Dec. 9, 2021, when Amazon’s stock
    AMZN,
    +2.71%
    closed at $147.17, according to Dow Jones Market Data.

    Don’t miss: Is Meta now a value stock?

    Amazon briefly surpassed Alphabet Inc.
    GOOG,
    +2.04%

    GOOGL,
    +2.12%
    as the third most valuable U.S. company by market capitalization last week, though it’s since fallen back to the No. 4 spot. Still, the recent momentum for Amazon shares has been enough to help the company hold down a place in the top four even as Nvidia Corp.
    NVDA,
    +3.58%
    nips at its heels.

    Alphabet finished Friday’s session with a $1.86 trillion market cap, while Amazon’s was $1.81 trillion and Nvidia’s was $1.78 trillion.

    Wall Street had a mixed reaction to earnings from big technology companies this quarter, but Amazon’s results were among those that were well received.

    See also: Amazon says the ‘magic words.’ They spurred a $130 billion market-cap boost.

    “Overall the overhangs which kept a lid on AMZN shares — e-commerce deceleration in 2021, e-commerce deceleration and margin compression in 2022 and AWS deceleration in 2023 — will have dissipated throughout 2024,” UBS analyst Stephen Ju wrote in a note to clients following those results.

    The company has been a huge driver of earnings growth for the S&P 500 consumer discretionary sector, as its quarterly earnings per share grew to $1 in the latest quarter from 3 cents a year before. The consumer discretionary sector is now expected to post 33% growth in EPS for the fourth quarter, according to FactSet, but without Amazon, that would swing to a decline of about 1%.



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  • Small businesses are paying 100%+ of profits to Uncle Sam after tax-law change

    Small businesses are paying 100%+ of profits to Uncle Sam after tax-law change


    Small businesses in sectors like software and manufacturing are panicking over the expiration of a critical tax deduction that they say could lead to mass layoffs and business closures, unless Congress acts quickly to amend the law.

    “This is a life-and-death scenario for small software companies,” Michelle Hansen, co-founder of the geocoding company Geocodio, told MarketWatch.

    The tax change that Hansen and other software executives are taking issue with was signed into law by President Trump in 2017, as part of a larger tax overhaul that slashed the top corporate tax rate from 35% to 21%.

    But in order to satisfy Senate budget rules and pass the law with only Republican votes, the bill could not increase the budget deficit over a 10-year window.

    So lawmakers included a provision that, beginning in 2022, drastically reduced how much research-and-development spending a business could deduct from their annual revenue to determine taxable income.

    The change penalizes certain industries like software and information technology — where engineer salaries are often classified as R&D expenses — as well as manufacturing and pharmaceuticals
    IHE.

    IntervalZero CEO Jeff Hibbard, whose Massachusetts-based company designs and sells software for installation on precision machines like semiconductor manufacturers, told MarketWatch that he has had to tap into company savings for the past several years in order to avoid laying off engineers.

    He said that his firm brings in about $9 million in revenue annually with expenses of $8 million — but 60% of those expenses come in the form of engineer salaries, which can only be deducted from taxable income over a five-year period because the IRS treats it as R&D.

    He said that after taxes consumed all his profits in 2022, he had to pay an additional $800,000 to Uncle Sam, and an additional $600,000 for the 2023 tax year.

    “We’ve had to do a hiring freeze and postpone projects” in a cutthroat industry where technology progresses rapidly, Hibbard said. “We’ve been in existence for 15 years. For the first 14, we always hired additional people. Now we have a hiring and salary freeze.”

    The House of Representatives voted last week 357-70 to restore full expensing for R&D as part of a $79 billion tax package that boosted the child tax credit and extended other business tax breaks.

    The bill now heads to the Senate, which already has its hands full debating immigration and national-security issues, and analysts say election-year politics could thwart its passage in 2024.

    Henrietta Treyz, director of economic-policy research at Veda Partners, gave just a 10% chance of the bill passing the Senate in a recent note to clients.

    “This year’s effort to pass a tax package has been more robust than the effort we saw in 2022 and 2023,” she wrote. Treyz added, however, that “the competing need to pass border reform and Ukraine/Israel aid, and general dysfunction in Washington keep us pessimistic that we’ll see a bipartisan economic-stimulus package come out of Congress this year.”

     On top of Republicans not wanting to give President Joe Biden a victory that would provide tax relief for businesses and families, Senate Republicans could decide to drag their feet on the bill in the hope that they’ll retake the chamber next year and can play a bigger role in the process, according to Owen Tedford, policy analyst at Beacon Policy Advisors.

    “The critical member to watch is Senator Mike Crapo [of Idaho], the top Republican on the Senate Finance Committee,” Tedford wrote. “Crapo has not outright opposed the bill but has raised policy concerns and has expressed a desire to have a chance to amend it.” 

    Political considerations may be dictating the bill’s fate in Washington — but some business owners fear they don’t have the wherewithal to wait until next year for the problem to be fixed.

    Benjamin Bengfort, co-founder and CEO of Iowa-based software firm Rotational Labs, told MarketWatch that he had to lay off workers last year after his 2022 tax bill rose by 438%.

    He noted that even demand for his products has taken a hit because of the change in the law, because his services can count as an R&D expense for his customers, too.

    “So it is [between] a rock and a hard place for us, no matter how you look at it,” Bengfort said. “This is an existential threat for software engineering companies.”

    Andrew Keshner contributed.



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  • Amazon is worth more than Alphabet for the first time in 16 months

    Amazon is worth more than Alphabet for the first time in 16 months


    Earnings season is causing a reshuffling among the ranks of the largest U.S. companies.

    Amazon.com Inc.
    AMZN,
    +7.87%
    overtook Alphabet Inc.
    GOOG,
    +0.58%

    GOOGL,
    +0.86%
    and become the third-largest U.S. public company upon Friday’s close, after its results were well received by Wall Street and Alphabet’s earlier in the week got panned.

    Amazon edged out Alphabet only barely, with a closing market cap of $1.785 trillion compared with $1.777 trillion for Alphabet, according to Dow Jones Market Data.

    Read: Amazon says the ‘magic words.’ They could spur a $110 billion market-cap boost.

    The e-commerce giant hadn’t been valued above the Google parent company since Sept. 30, 2022, according to Dow Jones Market Data. That was also the last time Amazon was the third-largest by market cap.

    Wall Street found plenty to like in Amazon’s latest report, including drastic improvement in operating income, upbeat commentary on the cloud and momentum within the retail business. Meanwhile, Alphabet’s earnings were met with a chillier reception as the company talked up heavy spending plans linked to its artificial-intelligence ambitions.

    The very top of the market-cap ranks has changed up as well lately, though admittedly with less of a tie to earnings. Microsoft Corp.’s
    MSFT,
    +1.84%
    closing valuation surpassed Apple Inc.’s
    AAPL,
    -0.54%
    on Jan. 12 for the first time since November 2021. While the two traded around the top spot in January, Microsoft has been sitting there since Jan. 25.

    Don’t miss: Microsoft earnings may have offered a big bullish clue about cloud growth

    Microsoft also rests alone in the $3 trillion club, with Apple, the only other U.S. company to ever claim membership, having fallen out of it.

    See also: Apple just did something unusual. Can it help the stock amid growth woes?



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  • Russian hacking group accessed Microsoft executive emails, company says

    Russian hacking group accessed Microsoft executive emails, company says

    Microsoft Corp. said Friday a Russian hacking group illegally gained access to some of its top executives’ email accounts.

    In a regulatory filing, the software giant
    MSFT,
    +1.22%
    said a group called Nobelium was responsible for the attack.

    In late November, the group accessed “a legacy non-production test tenant account and [gained] a foothold, and then used the account’s permissions to access a very small percentage of Microsoft corporate email accounts, including members of our senior leadership team and employees in our cybersecurity, legal, and other functions, and exfiltrated some emails and attached documents,” Microsoft’s Security Response Center wrote in a blog post.

    Microsoft’s senior leadership team, which includes Chief Financial Officer Amy Hood and President Brad Smith, routinely meets with Chief Executive Satya Nadella.

    The company reported that there were no signs Nobelium had obtained customer data, production systems or proprietary source code.

    A Microsoft spokesperson provided this comment late Friday: “Our security team recently detected an attack on our corporate systems attributed to the Russian state-sponsored actor Midnight Blizzard. We immediately activated our response process to investigate, disrupt malicious activity, mitigate the attack, and deny the threat actor further access. The attack was not the result of a vulnerability in Microsoft products or services. To date, there is no evidence that the threat actor had any access to customer environments, production systems, source code, or AI systems. More information is available in our blog.”

    Nobelium, also known as APT29 or Cozy Bear, is a shadowy hacking group that attempted to crack the systems of the U.S. Defense Department and did breach the Democratic National Committee’s systems in 2016.

    Netskope Threat Labs, which tracks Nobelium, said the hacking group uses a variety of techniques to compromise accounts, including compromised Azure AD accounts to collect victim emails. “This hack underscores the importance of securing corporate email accounts, even those in non-production and test environments,” a Netskope spokesperson said. “Even if the email account isn’t regularly used or doesn’t contain anything sensitive, it can still be used to launch additional attacks.”

    Microsoft’s disclosure comes amid new U.S. requirements to report cybersecurity incidents.

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  • So Long, Apple and Tesla. We Built a Better Magnificent 7.

    So Long, Apple and Tesla. We Built a Better Magnificent 7.

    By Nicholas Jasinski

    Jan 12, 2024, 1:00 am EST

    In this article

    AMZN

    AAPL

    MSFT

    NVDA

    SPX

    The Magnificent Seven had an extraordinary year in 2023—one that will be very difficult to repeat. And there will be a new Magnificent Seven in 2024.

    Continue reading this article with a Barron’s subscription.

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  • Hewlett Packard Enterprises to buy Juniper Networks in $14 billion deal

    Hewlett Packard Enterprises to buy Juniper Networks in $14 billion deal

    In an effort to keep up in the accelerating AI arms race, cloud-services provider Hewlett Packard Enterprise Co. on Tuesday agreed to buy Juniper Networks, Inc. in a deal worth around $14 billion.

    Under the terms of the deal, Hewlett Packard Enterprises
    HPE,
    -8.92%
    will acquire Juniper
    JNPR,
    +21.81%
    — which makes communications-networking products and also has an AI segment called Mist AI — for $40 a share. The companies expect the deal to close late this year or in early 2025.

    “The acquisition is expected to double HPE’s networking business, creating a new networking leader with a comprehensive portfolio that presents customers and partners with a compelling new choice to drive business value,” the companies said in a release.

    After the deal is completed, Juniper Chief Executive Rami Rahim will lead the combined HPE networking business, and report to HPE CEO Antonio Neri.

    “This transaction will strengthen HPE’s position at the nexus of accelerating macro-AI trends, expand our total addressable market, and drive further innovation for customers as we help bridge the AI-native and cloud-native worlds, while also generating significant value for shareholders,” Neri said in a statement.

    HPE said the addition of Juniper will boost margins and result in up to $450 million in annual cost savings within three years of the deal’s completion, as well as accelerate growth. HPE’s networking segment was the company’s top source of quarterly earnings before taxes, $401 million, on $1.4 billion in revenue.

    HPE’s deeper plunge into networking closes a chapter of sorts. Then-Hewlett-Packard Co. acquired Aruba Networks for about $3 billion in March 2015, months before Silicon Valley’s original garage startup split in half, resulting in the formation of HPE, which sells servers and other equipment for data centers, and HP Inc.
    HPQ,
    -2.71%    ,
    which makes PCs and printers.

    The Wall Street Journal reported the possibility of a deal on Monday, sending shares of Juniper higher.

    Shares of Juniper
    JNPR,
    +21.81%
    rose 0.5% after hours, after jumping 21.8% during regular trading hours. Hewlett Packard
    HPE,
    -8.92%
    shares were down 0.4% after hours, after falling 8.9% during the day.

    As of Tuesday’s close, Juniper had a market cap of $9.64 billion, while HPE’s was $23.04 billion.

    The companies hope the deal can provide a much-needed jolt after a series of lackluster quarterly earnings. Juniper shares have gained 15.7% over the past 12 months, while HPE shares are down 5.4% over that span. The S&P 500
    SPX,
    in comparison, is up about 21.4% over the past year.

    For decades, Juniper has lagged rival Cisco Systems Inc.
    CSCO,
    -1.09%
    in the networking-equipment market. In its most recent quarter, Juniper reported net income of $76 million on revenue of $1.4 billion, down 1% from the same quarter a year earlier.

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