Business

BEIJING — Chinese e-commerce giant PDD Holdings — owner of shopping platform Temu — announced on Monday a jump in net profit for the second quarter as the company continues to boost its competitiveness at home and abroad.

The Shanghai-based firm reported $4.4 billion of net profit for the quarter ending June 30, a 144 per cent rise from the same period last year, according to a company statement.

Its sales rose 86 per cent year-on-year to $13.4 billion.

PDD Holdings is the parent company of Pinduoduo — a Chinese online marketplace for low-cost products launched in 2015.

Pinduoduo is experiencing growing success in China at a time when Chinese consumers are cutting back on spending and turning to low-cost products even despite an economic slowdown and high youth unemployment.

Its international version, Temu, has sucked in consumers with its low prices and all-powerful algorithms. 

It has become one of the most popular online shopping sites in the United States, propelled by a marketing strategy that featured multiple prime-time Super Bowl advertisements.

It is also one of the fastest-growing apps in Europe despite only entering the EU market in April 2023, and has already faced fierce scrutiny from consumer groups over its practices.

PDD Holdings founder Colin Huang, worth $48.6 billion, recently became China's richest man, the Bloomberg Billionaires Index showed in August. 

In April, regulators in South Korea opened an investigation into Temu on suspicion of unfair practices including false advertising and poor product quality.

THE HAGUE — The Dutch data protection watchdog said on Monday it hit ride-hailing app Uber with a 290-million-euro ($324 million) fine over the transfer of personal data of European drivers to US servers.

The regulator said the transfers were a "serious violation" of the European Union's General Data Protection Regulation (GDPR), as they failed to appropriately protect driver information.

"Uber did not meet the requirements of the GDPR to ensure the level of protection to the data with regard to transfers to the US. That is very serious," Dutch Data Protection Authority (DPA) Chairman Aleid Wolfsen said in a statement.

The DPA said Uber collected sensitive information of European drivers, including taxi licences, location data, photos, payment details, identity documents, "and in some cases even criminal and medical data of drivers".

Over a two-year period, the DPA said, the information was transferred to Uber's US headquarters without using transfer tools.

"Because of this, the protection of personal data was not sufficient," the DPA said, noting that Uber has "ended the violation".

Uber said it would appeal the fine, a process that suspends the penalty but can take up to four years.

"This flawed decision and extraordinary fine are completely unjustified," an Uber spokesperson said in a statement

"Uber's cross-border data transfer process was compliant with GDPR during a 3-year period of immense uncertainty between the EU and US. We will appeal and remain confident that common sense will prevail," the statement said.

French drivers complained 

The EU has rolled out a series of rules for what big tech firms can and cannot do, and imposed huge fines for breaches in recent years.

The DPA said it started the investigation after more than 170 French drivers complained to a French human rights interest group, which then filed a complaint to France's data protection watchdog.

Under the GDPR, a business that processes data in several EU countries must deal with the data protection authority where its main office is located. Uber's European headquarters are in The Netherlands.

"In Europe, the GDPR protects the fundamental rights of people, by requiring businesses and governments to handle personal data with due care," Wolfsen said.

"But sadly, this is not self-evident outside Europe," he said,

"Think of governments that can tap data on a large scale. That is why businesses are usually obliged to take additional measures if they store personal data of Europeans outside the European Union."

It is the DPA's third fine against Uber following fines of 600,000 euros in 2018 and 10 million euros last year.

Period of 'uncertainty' 

Uber said Monday the most recent case relates to a complaint that dates back to 2021, during a three-year period "when there was significant uncertainty regarding data transfers between the US and the EU".

It said the uncertainty began after the Court of Justice of the European Union invalidated a data transfer framework known as the EU-US Privacy Shield in 2020.

A successor, the EU-US Data Privacy Framework, was adopted by The European Commission last year.

"Similar to what many other companies operating in the EU and transferring data to the US had to do, during the period the Privacy Shield was disputed, Uber continued to safeguard data in accordance with GDPR," the company said.

Washington — SpaceX is coming to Boeing's rescue.

The legacy company needing aid from an upstart rival is hardly welcome news to the aerospace giant.

Because of problems with Boeing's Starliner spacecraft, two astronauts who rode on it to the International Space Station in June will finally return to Earth on a vessel built by Elon Musk's SpaceX.

NASA's announcement Saturday of that plan represents a blow -- even a humiliation -- for Boeing, a historic partner of the American space agency.

It couldn't come at a worse time for Boeing. The sterling reputation its airplanes have long enjoyed has been seriously eroded by a series of malfunctions and two fatal crashes in recent years.

"It's not a good time for Boeing," Erik Seedhouse, a professor at Embry-Riddle Aeronautical University, told AFP.

For Butch Wilmore and Suni Williams, the astronauts who flew to the ISS on Starliner, to have to return on a SpaceX craft is "very embarrassing," he added.

"It is an image problem," agreed Cai von Rumohr, an aeronautics analyst with TD Cowen, adding that it "could endanger future contracts with NASA."

But Boeing's status and mammoth size give it considerable capacity to bounce back.

"I don't think Boeing is going anywhere," said Glenn Lightsey, a professor at the Guggenheim School of Aerospace Engineering at Georgia Tech University.

Boeing has engendered cost overruns of some $1.6 billion in developing Starliner, hit by repeated delays in development and price hikes linked to supply chain problems.

But to put that in context, Boeing's Defense, Space & Security division had turnover of $24.93 billion in 2023 -- while the overall company had revenues of $77.79 billion.

"Yes, they can recover, because they're a juggernaut," said Seedhouse.

Regaining confidence

Despite repeated delays in the Starliner program, NASA has never suggested any weakening of the collaboration with Boeing since first placing orders for space "taxis" in 2014 from both Boeing and SpaceX.

The US space agency has repeatedly insisted its goal is to have two vehicles to ferry astronauts to and from the ISS, a sort of insurance plan in case one has problems.

What Boeing needs to do to regain confidence, Seedhouse said, is "to solve all these problems and have a successful re-flight sometime next year, probably, with another crew on board."

The company has insisted the two problems Starliner has encountered -- helium leaks and a defective propulsive system -- are fixable.

Such problems are not a "huge surprise," Lightsey said, adding that "it's still early development for Starliner."

The craft has undergone three orbital tests, two of them uncrewed.

"It's really only after maybe you get five missions under your belt" that "you know how everything is going to behave in space," he added.

"Even if it takes a couple more flights, I don't expect NASA to give up on them."

A tough comparison 

The comparison between the rival programs of Boeing and SpaceX is nonetheless embarrassing for the older and much larger firm.

Musk's company was widely seen as an outsider in 2014 and received $2.6 billion for the project, compared to Boeing's $4.2 billion.

Yet for the past four years it has been the sole means for astronauts to travel to and from the ISS.

SpaceX had one advantage from the start: its Dragon vessel has been resupplying the ISS since 2012.

But Boeing, for its part, has a long history with NASA, with decades of work on the US space program.

"They were involved with the Apollo program; they built some of the modules on the space station," Seedhouse said.

"So it's a surprise that, in such a short period... they've gone from being a company that's performed very well to a company that has been making mistakes, left, right and center."

He said there was no single reason for the serial setbacks, but that "problems with standards and quality control" at Boeing "apply both to the spacecraft side of things and also to the aircraft."

Because of its size, Seedhouse said, Boeing is intrinsically more bureaucratic than SpaceX, where decisions can be made quickly.

But the dynamic could change one day.

At some future point, Lightsey said, "SpaceX will need help, and Boeing will be able to return the favor.

"I assume it will all come full circle eventually."

PARIS — Nestle shares fell Friday after the surprise departure of chief executive Mark Schneider, which followed slowing sales growth and bad headlines at the Swiss food group. 

The company announced after markets closed Thursday that Schneider would step down on September 1 after almost eight years in charge and be replaced by Nestle's Latin America chief, Laurent Freixe. 

Nestle shares fell more than three per cent in early deals on the Swiss stock exchange but pared down those losses later in the morning for a 1.5 per cent drop. 

In a conference call with investors on Friday, chairman Paul Bulcke acknowledged that the decision "may come as a surprise for many of you" but that it was "time ... for a change" at the company. 

He added that "different qualities" were needed. 

Nestle, whose brands range from Nespresso coffee capsules to Purina dog food and Haagen-Dazs ice cream, lowered its sales growth outlook for 2024 last month as it slowed its price increases in the first half of the year. 

The global packaged-food giant and its rivals had logged high sales growth in the past three years as they raised prices to make up for higher costs due to soaring inflation. 

The company has also faced controversy in recent years, with Swiss NGO Public Eye accusing Nestle of selling baby food with high levels of added sugar in low-income countries but not in wealthier nations. 

Nestle has countered that it had "no double standard" and applied the same nutrition and health principles everywhere.

It has also scrambled to ease any concerns over its Perrier brand after France's food safety watchdog recommended stricter monitoring of sites where Nestle extracts mineral water following the discovery of traces of "faecal" contamination. 

The company has since said it has stepped up monitoring of the sites, and Schneider has said the group's water was safe to drink. 

Schneider's departure "does not come as a major surprise given that both Nestle's operational and share price performances have proved disappointing over the past 2 and a half years", Swiss bank UBS said in a note. 

"Furthermore, the company suffered through an unusually high number of negative headlines," it said. 

Freixe, a Frenchman who joined Nestle in 1986, told investors on Friday that his "big focus" will be on sales growth and "market share gains".

"It all starts with strengthening trust in Nestle," he added.

Schneider, a German-American who took over in January 2017, said that "it has been an honour and a privilege to serve Nestle and leaving is not a decision I've taken lightly".

PARIS — US and European stock markets rebounded Wednesday but Asia slipped as investors waited for a speech by US Federal Reserve chief Jerome Powell at the end of the week.

Traders are hoping Powell will give more hints about a widely expected Fed interest-rate cut when he addresses an annual gathering of central bank chiefs in Jackson Hole, Wyoming, on Friday.

US stocks climbed at the open, after all main indexes fell a day earlier, breaking an eight-day advance.

The London, Paris and Frankfurt stock markets all gained in afternoon trading, after major Asian indexes closed in the red.

"In the absence of major data, I believe that the rebound is backed by optimism into the Jackson Hole meeting and the prospects of Fed rate cuts," Swissquote Bank analyst Ipek Ozkardeskaya told AFP.

Markets had retreated earlier this month after weak US data raised fears of recession in the world's biggest economy.

But they recovered as more recent indicators showed healthy retail sales and easing inflation, backing the view that the Fed is on course to guide the economy to a "soft landing" and avoid a recession.

Traders will pore over revised US payroll data due later Wednesday for more indications about what the Fed might do.

'Markets have settled'

Analysts expect the Fed to cut rates — which has been raised to a 23-year high to combat inflation — at its next meeting in September. The question is whether it will reduce them by 0.25 percentage points or more.

"After a wild ride in the last three weeks that had little basis in fundamentals, markets have settled on predicting a first 25 bp [basis point] Fed rate cut at its 18 September meeting," said Holger Schmieding, chief economist at Berenberg bank.

But Stephen Innes, managing partner from SPI Asset Management, warned that "it wouldn't take much more than a bump in the unemployment rate to shove the market right back into 50bps territory".

Other central banks, including the European Central Bank and Bank of England, have already started to reduce borrowing costs.

Sweden's Riksbank lowered its policy rate for the second time this year on Tuesday while New Zealand made its first cut since early 2020 last week.

The dollar steadied against the pound and euro on Tuesday after sinking recently due to the prospect of lower interest rates, which make the greenback less attractive to investors in assets such as bonds.

Gold prices fell to $2,507 after breaking to a record high above $2,530 on Tuesday on Fed rate cut bets that would make the metal more attractive to investors.

Meanwhile oil prices steadied after a series of declines, as efforts continue for a ceasefire between Israel and Hamas to avert a broader war in the Middle East.