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Apple set for big sales decline as investors await AI in iPhones

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Apple’s (AAPL.O), opens new tab plan to add generative AI to its iPhones and revive sagging sales in the crucial Chinese market will be in focus on Thursday, when the tech giant is expected to report its biggest quarterly revenue decline in more than a year, Reuters reported.

Long considered a must-own stock on Wall Street, Apple shares have underperformed other Big Tech companies in recent months, falling more than 10% this year as fears mount about its slow roll-out of artificial intelligence services and as a resurgent Huawei (HWT.UL) takes market share in China.

Analysts on average see iPhone sales, which account for about half of Apple’s revenue, falling 10.4% in the first three months of 2024, according to LSEG. That drop would be the steepest in more than three years.

The year-ago iPhone revenue that the 10.4% iPhone sales drop is measured against was unusually high as Apple satisfied pent-up demand after the COVID pandemic, company executives previously noted.

At least $5 billion of the $51.3 billion in iPhone sales a year ago was essentially catching up from disruptions in the December 2022 quarter when COVID lockdowns in China hampered iPhone production, executives said.

Even with that factored in, Wall Street expects a slight decline in iPhone sales, and analysts estimate Apple’s total revenue declined 5% in its fiscal second quarter ended in March. That would be Apple’s biggest revenue decline since the December 2022 quarter, when revenue fell 5.5%, read the report.

Apple earlier this year lost the crown of the world’s most valuable company to Microsoft (MSFT.O), opens new tab. Its market value stands at $2.68 trillion after the share price declined 11.24% so far this year.

Weak revenue and falling shares have pressured Apple to spruce up its flagship device after years without major upgrades.

The company is in talks with OpenAI and Alphabet-owned Google to add genAI features for the iPhone that could be unveiled at what is expected to be its biggest-ever annual developer conference in June, Bloomberg News has reported.

According to Reuters analysts believe such an AI integration could drive demand for the next iPhone series, expected to be announced in the fall.

While executives at Microsoft, Alphabet (GOOGL.O), opens new tab, Meta Platforms (META.O), opens new tab and other major technology firms have talked up their AI strategies on quarterly conference calls in recent months, Apple CEO Tim Cook has discussed his plans for the emerging technology much less.

Adding AI features to iPhones could also help Apple to compete better with Huawei and Samsung Electronics (005930.KS), opens new tab, which reclaimed the title of the world’s top smartphone vendor from Apple this year, driven by demand for the AI features in its Galaxy S24 smartphones.

“Replacement cycle tailwinds and incremental generative AI features set up Apple well for a strong iPhone 16 cycle,” Bernstein analyst Toni Sacconaghi said this week as he upgraded the company’s shares to “outperform” from “market-perform.”

“We believe prevailing weakness in China is more cyclical than structural, and note historically Apple’s China business has exhibited much higher volatility than Apple overall, given its very feature-sensitive installed base.”

Thursday’s earnings will also be watched closely for updates on the company’s stock buyback plan and the Vision Pro, Apple’s first major product in years that hit the shelves in February.

After initial enthusiasm, there have been signs that demand slowed for the $3,500 device, with an analyst saying this month that Apple has pulled back its production estimates for the mixed-reality headset.

The rest of the company’s hardware business is also reeling from soft demand, with iPads and Mac sales expected to fall 11.4% and 4.3%, respectively, in the March quarter, Reuters reported.

Apple has signaled it is sharpening its focus on the devices, which have also been hobbled by a lack of major upgrades.

At an Apple event this month, a revamped iPad line-up is expected to be unveiled and media reports have said that it plans to update every Mac model with faster, AI-focused M4 processors.

The services business, which includes App Store and subscription services such as Apple TV, is expected to remain a bright spot with revenue growth of 7.7%.

Apple shares closed down 0.6% at $169.30 on Wednesday.

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Meta releases new AI model Llama 4

Meta said in a statement that the Llama 4 Scout and Llama 4 Maverick are its “most advanced models yet” and “the best in their class for multimodality.”

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Meta Platforms on Saturday released the latest version of its large language model (LLM) Llama, called the Llama 4 Scout and Llama 4 Maverick.

Meta said Llama is a multimodal AI system. Multimodal systems are capable of processing and integrating various types of data including text, video, images and audio, and can convert content across these formats.

Meta said in a statement that the Llama 4 Scout and Llama 4 Maverick are its “most advanced models yet” and “the best in their class for multimodality.”

Meta added that Llama 4 Maverick and Llama 4 Scout will be open source software. It also said it was previewing Llama 4 Behemoth, which it called “one of the smartest LLMs in the world and our most powerful yet to serve as a teacher for our new models.”

Big technology firms have been investing aggressively in artificial intelligence (AI) infrastructure following the success of OpenAI’s ChatGPT, which altered the tech landscape and drove investment into machine learning.

The Information reported on Friday that Meta had delayed the launch of its LLM’s latest version because during development, Llama 4 did not meet Meta’s expectations on technical benchmarks, particularly in reasoning and math tasks.

The company was also concerned that Llama 4 was less capable than OpenAI’s models in conducting humanlike voice conversations, the report added.

Meta plans to spend as much as $65 billion this year to expand its AI infrastructure, amid investor pressure on big tech firms to show returns on their investments.

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‘Massive cyberattack’ brings down Elon Musk’s X

Digital Trends reported Tuesday that there are reports suggesting X is still having issues

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Social media platform X went down intermittently on Monday, with owner Elon Musk blaming an unusually powerful cyberattack.

“We get attacked every day, but this was done with a lot of resources. Either a large, coordinated group and/or a country is involved,” Musk said in a post on X on Monday.

He did not clarify exactly what he meant by “a lot of resources” and his comments drew skepticism from cybersecurity specialists, who pointed out that attacks of this nature — called denials of service — have repeatedly been executed by small groups or individuals.

X faced intermittent outages, according to Downdetector, Reuters reported.

Digital Trends meanwhile reported Tuesday that there are reports suggesting X is still having issues. 

Internet industry experts have said X was hit by several waves of ‘denial of service’ throughout Monday. 

Musk said in an interview with Fox Business Network’s Larry Kudlow the cyberattack came from IP addresses originating in the Ukraine area.

An industry source told Reuters he disputed Musk’s account, saying that large chunks of the rogue traffic bombarding X could be traced back to IP addresses in the United States, Vietnam, Brazil and other countries, and that the amount of rogue traffic coming directly from Ukraine was “insignificant.”

In any case, denial of service attacks are notoriously hard to trace back to their authors and the IP addresses involved rarely provide any meaningful insight into who was behind them, Reuters reported.

Musk has joined U.S. President Donald Trump, whom he serves as an adviser, in criticizing Ukraine’s continued efforts to fight off a Russian invasion. 

Musk said on Sunday that Ukraine’s front line “would collapse” without his Starlink satellite communications service, though he said he would not cut off Ukraine’s access to it.

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NASA says ‘city killer’ asteroid has a 3.1 % chance of striking Earth in 2032

Despite the rising odds, experts say there is no need for alarm

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An asteroid that could level a city now has a 3.1-percent chance of striking Earth in 2032, according to NASA data released Tuesday — making it the most threatening space rock ever recorded by modern forecasting.

Despite the rising odds, experts say there is no need for alarm. The global astronomical community is closely monitoring the situation and the James Webb Space Telescope is set to fix its gaze on the object, known as 2024 YR4, next month.

“I’m not panicking,” Bruce Betts, chief scientist for the nonprofit Planetary Society told AFP.

“Naturally when you see the percentages go up, it doesn’t make you feel warm and fuzzy and good,” he added, but explained that as astronomers gather more data, the probability will likely edge up before rapidly dropping to zero.

2024 YR4 was first detected on December 27 last year by the El Sauce Observatory in Chile.

Astronomers estimate its size to be between 130 and 300 feet (40–90 meters) wide, based on its brightness. Analysis of its light signatures suggests it has a fairly typical composition, rather than being a rare metal-rich asteroid.

The International Asteroid Warning Network (IAWN), a worldwide planetary defense collaboration, issued a warning memo on January 29 after the impact probability had crossed one percent. Since then, the figure has fluctuated but continues to trend upward.

NASA’s latest calculations estimate the impact probability at 3.1 percent, up from 1.6 percent last month, with a potential Earth impact date of December 22, 2032.

Richard Moissl, head of the European Space Agency’s planetary defense office, which puts the risk slightly lower at 2.8 percent told AFP that  this “is not a crisis at this point in time. This is not the dinosaur killer. This is not the planet killer. This is at most dangerous for a city.”

If the risk rises over 10 percent, IAWN would issue a formal warning, leading to a “recommendation for all UN members who have territories in potentially threatened areas to start terrestrial preparedness,” explained Moissl.

Unlike the six-mile-wide (10-kilometer-wide) asteroid that wiped out the dinosaurs 66 million years ago, 2024 YR4 is classified as a “city killer” — not a global catastrophe, but still capable of causing significant destruction.

Its potential devastation comes less from its size and more from its velocity, which could be nearly 40,000 miles per hour if it hits.

If it enters Earth’s atmosphere, the most likely scenario is an airburst, meaning it would explode midair with a force of approximately eight megatons of TNT — more than 500 times the power of the Hiroshima bomb.

But an impact crater cannot be ruled out if the size is closer to the higher end of estimates, said Betts.

The potential impact corridor spans the eastern Pacific, northern South America, the Atlantic, Africa, the Arabian Peninsula, and South Asia — though Moissl emphasized it is far too early for people to consider drastic decisions like relocation.

The good news: there’s ample time to act.

NASA’s 2022 DART mission proved that spacecraft can successfully alter an asteroid’s path, and scientists have theorized other methods, such as using lasers to create thrust by vaporizing part of the surface, pulling it off course with a spacecraft’s gravity, or even using nuclear explosions as a last resort. — Agence France-Presse

 

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