15/05/2026

BIZ & FINANCE FRIDAY | MAY 15, 2026

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Honda posts first annual loss in nearly 70 years

AI boom puts SK Hynix on cusp of US$1t market value SEOUL: SK Hynix is on the verge of topping a US$1 trillion market value, just weeks after Samsung Electronics crossed the milestone, as strong demand for artificial intelligence places South Korea at the heart of Asia’s AI boom. SK Hynix shares have risen more than 200% this year, after rising an eye-watering 274% in 2025, driven by AI-related demand for both conventional memory chips and high-bandwidth memory (HBM) chips used in AI servers. Valued at less than US$100 billion just 16 months ago, SK Hynix’s market capitalisation stood at roughly US$942 billion at the close of trading yesterday. If SK Hynix reaches the milestone, South Korea would become the first country outside the United States to have more than one trillion-dollar company. Taiwan’s TSMC remains Asia’s biggest company by market value at over US$1.83 trillion. The three chipmakers and their record earnings have put the spotlight on their critical role in the global AI supply chain, in contrast to Silicon Valley companies whose heavy spending on chips and technology makes them riskier bets. SK Hynix shares closed down 0.3% yesterday, while the broader Kospi ended up 1.75% at 7,981.41. The index has been on a tear, up more than 86% this year after soaring 75% in 2025 in its strongest annual performance since 1999. KB Securities raised its year-end target for Kospi, the best-performing major stock market in the world since the start of 2025, by 40% to 10,500 points. “My theory is that the market is running on FOMO sentiments, especially on AI-related names in Japan and Korea,“ said Fabien Yip, market analyst at IG in Sydney, referring to investors’ “fear of missing out” on potential returns. Shares of SK Hynix could stand to benefit from labour woes at rival Samsung, although not over the long term, analysts say. Samsung’s South Korean union, furious over what it calls a massive gap in bonus pay with SK Hynix, has planned an 18-day strike from May 21 if its demands are not met. Samsung and its union failed to reach a pay deal this week. The company, however, has urged for talks to be resumed, while South Korea’s Labour Commission has also called on both sides to hold another round of government-mediated talks tomorrow. Analysts say Samsung’s rivals such as SK Hynix, Micron and TSMC could benefit from spillover demand in the event of a strike, but warn that a prolonged strike could eventually weigh on the broader chip supply chain. – Reuters

o Automaker hit by US$9 billion electric vehicle writedown, scraps long-term EV sales goals TOKYO: Honda Motor posted its first annual loss in nearly 70 years as a listed company yesterday, hit by more than US$9 billion in costs to restructure its electric-vehicle business, and the firm scrapped its long-term EV sales target. Revealing its worst financial report since Honda listed on the stock market in 1957 underscores how risky an aggressive bet on EVs can be for a legacy automaker when it slams into weaker-than-expected demand. Toshihiro Mibe, chief executive of Japan’s second-largest automaker, said yesterday Honda is scrapping its goal of having EVs make up a fifth of its new car sales in 2030 as well as a target of a full shift to electric or fuel-cell vehicle sales by 2040. Mibe said Honda will also indefinitely suspend its Canada EV project, an US$11 billion investment plan to produce EVs and batteries in what would have been the Japanese firm’s largest ever investment in the country. Honda’s shares briefly hit a two-month high before closing up 3.8% yesterday, after it pledged at least ¥800 billion (RM19 billion) in shareholder returns over three years and kept the annual dividend for both the new fiscal year and the year just ended at ¥70 per share. The pledge highlights Honda’s reliance on its profitable motorcycle business to generate cash and support shareholder returns, as its auto operation continues to lag in terms of scale and execution. “The overall execution has been very slow,” said James Hong, head of mobility research at Macquarie. Some steps the company laid out as part of its strategy, such as using more local components from China, were “nothing”, new,” he said. Its operating loss totalled ¥414.3 billion for

The Honda logo on a billboard at a dealership in Tokyo yesterday. – AFPPIC

Honda said in an earnings statement. Strong sales in India and Brazil enabled its motorcycle business to achieve record-high sales volume and operating profit in the fiscal year ended in March, helping the firm cushion the impact of a bruising EV business writedown as well as sliding car sales in key markets including China. Hong said Honda’s motorcycle business also faces margin pressure due to a transition to EVs in some of its key markets like India and Vietnam. “They have a limited time window to act,” he said. The company expects rising material prices, including the impact of the Middle East conflict, would cause a ¥313 billion hit to its operating profit in the current fiscal year. – Reuters said it does not expect geopolitics to impact its supply of key materials such as helium and hydrogen in the near term. On Wednesday, some of Foxconn’s factories in North America suffered a cyberattack, according to a company statement. “The affected factories are currently resuming normal production,“ after a response from the cybersecurity team, said the statement dated Wednesday afternoon in Taiwan. TechCrunch and other media outlets reported that ransomware gang Nitrogen had claimed responsibility for the hack on the dark web. – AFP

the year ended March, compared with a median estimate of a ¥315.6 billion loss in a poll of 22 analysts by LSEG and a ¥1.2 trillion profit a year earlier. Honda booked total EV-related losses of ¥1.45 trillion for the business year ended March and expects to face additional costs of ¥500 billion for the year just started. That compares with EV writedown costs of up to ¥2.5 trillion that Honda estimated in March. The company still expects to return to profitability this year, forecasting a ¥500 billion profit on cost-reduction measures and its profitable motorcycle business. “The motorcycle business will expand production capacity in India ... and aim for record-high sales of 22.8 million units,”

Foxconn logs quarterly net profit jump on AI server demand TAIPEI: Taiwanese tech hardware giant Foxconn yesterday announced a 19% jump in quarterly net profit as the booming market for artificial intelligence servers drives growth, despite geopolitical uncertainty. January-March came to NT$49.9 billion (RM6.3 billion), up from NT$42.1 billion in the same period the previous year. The figure beat estimates in a Bloomberg survey of analysts.

Foxconn said it expects“strong demand for AI servers” to continue this year, forecasting “high double-digit quarter-on-quarter growth” for AI rack shipments in the second quarter. When the company reported its annual results in March, chairman Young Liu had shrugged off concerns that market volatility caused by global conflict would dent profits. Taiwanese contract chipmaker TSMC has also

Foxconn, whose official name is Hon Hai Precision Industry, has gone beyond assembling low-margin iPhones to making AI servers for Nvidia, along with electric vehicles and robots. Soaring global demand for generative AI tools is boosting business for Foxconn, even as the war in the Middle East has threatened supply chain volatility. The company said yesterday net profit for

India bars sugar exports until September NEW DELHI: India, one of the world’s largest sugar producers, has banned exports of the key commodity until the end of September to ensure enough domestic supplies and prevent prices from rising.

since their peak in 2021-22, government data shows. Shipments reached a record 11 million tonnes in 2021-22, but then declined to 6.3 million tonnes in 2022-23. They dropped steeply to 100,000 tonnes in 2023-24 before recovering modestly to about 900,000 tonnes in 2024-25. – AFP

around October, could be affected by a lower-than-average monsoon because of the El Nino weather pattern. The Iran war has strained India’s economy, heavily reliant on Middle Eastern energy supplies and fertiliser imports, and has cast uncertainty over New Delhi’s growth outlook. India’s sugar exports have fallen sharply

exceptions, including consignments already in the pipeline. Exports under government deals for food security with other countries would also be allowed, the order said. The ban will stay in place until Sept 30. The move comes amid concerns that the country’s next sugar harvest, which starts

The government prohibited exports “with immediate effect”, according to an order issued late on Wednesday, other than limited