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Panasonic cuts full-year outlook as costly raw materials weigh

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Panasonic cuts full-year outlook as costly raw materials weigh

Japan’s Panasonic Holdings Corp (6752.T) cut its annual operating profit forecast by 12.5% on Thursday after lower-than-expected third-quarter earnings, hit by headwinds from a slowing global economy and persistently high raw materials prices.

The company faces challenges amid a tricky outlook for global growth, as it looks to further build out its energy business, which includes making auto batteries for electric vehicle (EV) maker Tesla Inc (TSLA.O).

The conglomerate slashed its operating profit forecast to 280 billion yen ($2.18 billion) for the financial year to Mar. 31, from 320 billion yen, in part due to a less rosy outlook for its industry segment this quarter.

It expects to invest up to about 600 billion yen in the three years through March 2025 in a new battery plant it started building in Kansas last year, Group Chief Financial Officer Hirokazu Umeda told an online earnings presentation.

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Panasonic said in presentation materials it will aim to grow profits in automotive batteries by expanding sales of its 2170 model lithium-ion battery cells and commercialising the more advanced 4680 format battery.

The company’s energy unit last month signed an agreement with Lucid Group Inc (LCID.O) to supply lithium-ion batteries for the EV maker’s full lineup, including its “Air” luxury model.

The company also said it aimed to begin supplying the 4680 format battery to the North American market in the financial year through March 2024 to commercialise this model of battery cells.

Panasonic’s third-quarter result, with its operating profit rising 16% to 84.4 billion yen in the three months ended Dec. 31, fell short of a mean estimate of 95.31 billion yen profit from nine analysts.

Jefferies analysts said in a note before the earnings release that the company’s overly diverse business portfolio lacked focus and was centred on low-margin, cyclical businesses.

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Most investors were focused on more clarity and details about U.S. Inflation Reduction Act benefits for Panasonic’s EV battery cell production, such as the size and sustainability of subsidies, the analysts added.

The energy business’ operating profit fell nearly half to 28.9 billion yen for the nine months through the end of December, hit mainly by high prices for raw materials and transport, despite a 25% rise in sales over the period.

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A former OpenAI leader says safety has ‘taken a backseat to shiny products’ at the AI company

A former OpenAI leader says safety has ‘taken a backseat to shiny products’ at the AI company

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A former OpenAI leader says safety has 'taken a backseat to shiny products' at the AI company

A former OpenAI leader who resigned from the company earlier this week said Friday that safety has “taken a backseat to shiny products” at the influential artificial intelligence company.

Jan Leike, who ran OpenAI’s “Superalignment” team alongside a company co-founder who also resigned this week, wrote in a series of posts on the social media platform X that he joined the San Francisco-based company because he thought it would be the best place to do AI research.

“However, I have been disagreeing with OpenAI leadership about the company’s core priorities for quite some time, until we finally reached a breaking point,” wrote Leike, whose last day was Thursday.

An AI researcher by training, Leike said he believes there should be more focus on preparing for the next generation of AI models, including on things like safety and analyzing the societal impacts of such technologies.

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He said building “smarter-than-human machines is an inherently dangerous endeavor” and that the company “is shouldering an enormous responsibility on behalf of all of humanity.”

“OpenAI must become a safety-first AGI company,” wrote Leike, using the abbreviated version of artificial general intelligence, a futuristic vision of machines that are as broadly smart as humans or at least can do many things as well as people can.

Open AI CEO Sam Altman wrote in a reply to Leike’s posts that he was “super appreciative” of Leike’s contributions to the company was “very sad to see him leave.”

Leike is “right we have a lot more to do; we are committed to doing it,” Altman said, pledging to write a longer post on the subject in the coming days.

The company also confirmed Friday that it had disbanded Leike’s Superalignment team, which was launched last year to focus on AI risks, and is integrating the team’s members across its research efforts.

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Leike’s resignation came after OpenAI co-founder and chief scientist Ilya Sutskever said Tuesday that he was leaving the company after nearly a decade.

Sutskever was one of four board members last fall who voted to push out Altman — only to quickly reinstate him. It was Sutskever who told Altman last November that he was being fired, but he later said he regretted doing so.

Sutskever said he is working on a new project that’s meaningful to him without offering additional details.

He will be replaced by Jakub Pachocki as chief scientist. Altman called Pachocki “also easily one of the greatest minds of our generation” and said he is “very confident he will lead us to make rapid and safe progress towards our mission of ensuring that AGI benefits everyone.”

On Monday, OpenAI showed off the latest update to its artificial intelligence m

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US, TikTok seek fast-track schedule, ruling by Dec. 6 on potential ban

US, TikTok seek fast-track schedule, ruling by Dec. 6 on potential ban

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US, TikTok seek fast-track schedule, ruling by Dec. 6 on potential ban

The U.S. Justice Department and TikTok on Friday asked a U.S. appeals court to set a fast-track schedule to consider the legal challenges to a new law requiring China-based ByteDance to divest TikTok’s U.S. assets by Jan. 19 or face a ban.

TikTok, ByteDance and a group of TikTok content creators joined with the Justice Department in asking the U.S. Court of Appeals for the District of Columbia to rule by Dec. 6 to be able to seek review from the Supreme Court if needed before the U.S. deadline. 

On Tuesday, a group of TikTok creators filed suit to block the law that could ban the app used by 170 million Americans, saying it has had “a profound effect on American life.”

Last week, TikTok and parent company ByteDance filed a similar lawsuit, arguing that the law violates the U.S. Constitution on a number of grounds including running afoul of First Amendment free speech protections.

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“In light of the large number of users of the TikTok platform, the public at large has a significant interest in the prompt disposition of this matter,” the U.S. Justice Department and TikTok petitioners said.

TikTok said with a fast-track schedule it believes the legal challenge can be resolved without it needing to request
emergency preliminary injunctive relief.

The law, signed by President Joe Biden on April 24, gives ByteDance until Jan. 19 to sell TikTok or face a ban. The White House says it wants to see Chinese-based ownership ended on national security grounds, but not a ban on TikTok.

The parties asked the court to set the case for oral arguments as soon as practical during the September case calendar. The Justice Department said it may file classified material to support the national security justifications in secret with the court.

Earlier this week the Justice Department said the TikTok law “addresses critical national security concerns in a manner that is consistent with the First Amendment and other constitutional limitations.”

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The law prohibits app stores like Apple and Alphabet’s Google from offering TikTok and bars internet hosting services from supporting TikTok unless ByteDance divests TikTok.

Driven by worries among U.S. lawmakers that China could access data on Americans or spy on them with the app, the measure was passed overwhelmingly in Congress just weeks after being introduced.

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Spotify sued over alleged unpaid royalties

Spotify sued over alleged unpaid royalties

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Spotify sued over alleged unpaid royalties

Music streaming giant Spotify has been sued in a US federal court for allegedly underpaying songwriters, composers and publishers by tens of millions of dollars.

The lawsuit against Spotify USA was filed in New York on Thursday by the Mechanical Licensing Collective (MLC), a non-profit that collects and distributes royalties owed from music streaming services.

The suit alleges that Spotify on March 1, without advance notice, reclassified its paid subscription services, resulting in a nearly 50 percent reduction in royalty payments to MLC.

“The financial consequences of Spotify’s failure to meet its statutory obligations are enormous for Songwriters and Music Publishers,” MLC said.

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“If unchecked, the impact on Songwriters and Music Publishers of Spotify’s unlawful underreporting could run into the hundreds of millions of dollars.”

According to MLC, Spotify reclassified its Premium Individual, Duo and Family subscription streaming plans as Bundled Subscription Offerings because they now include audiobooks.

Royalties paid on bundled services are significantly less. MLC said Premium subscribers already had access to audiobooks and “nothing has been bundled with it.”

“Premium is exactly the same service that Spotify offered to its subscribers before the launch of Audiobooks Access,” it said. In a statement, Spotify said the lawsuit “concerns terms that publishers and streaming services agreed to and celebrated years ago.”

Spotify said it paid a “record amount” in royalties last year and “is on track to pay out an even larger amount in 2024.” “We look forward to a swift resolution of this matter,” the Swedish company said.

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In February, Spotify said it paid $9 billion to musicians and publishers last year, about half of which went to independent artists. 

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