Apple's 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.
Long considered a must-own stock on Wall Street, Apple shares have underperformed other Big Tech companies in recent months, falling more than 10% year to date as fears mount about its slow roll out of AI services and as a resurgent Huawei 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.
Analysts estimate Apple's total revenue declined 5% in its second quarter, which included January through March. That would be Apple's biggest revenue decline since the December-quarter of 2022, when revenue fell 5.5%.
Apple earlier this year lost the crown of the world's most valuable company to Microsoft and its market value now stands at $2.68 trillion after the decline in its share price in 2024.
Weak revenue and falling shares have put pressure on 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.
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, Meta Platforms 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, which reclaimed the title of the world's top smartphone vendor from Apple earlier 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, upgrading his rating on 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.
Apple has signaled it is sharpening its focus on the devices, which have also been hobbled by a lack of major upgrades.
The company is hosting an event later this month where 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 money earned from App Store and subscription services such as Apple TV - is expected to remain a bright spot with revenue growth of 7.7%.
Canopy Growth drops 20%, Tilray drops 15% and Curaleaf falls 5% after sharp gains on the DEA's plan to make pot a Schedule III controlled substance
Canopy Growth Corp., Tilray Brands Inc. and Curaleaf Holdings Inc. moved into the red along with other cannabis stocks on Wednesday.
The sector cooled off after a huge rally in the previous session on plans by the Biden administration to reclassify pot as less dangerous under federal law.
Canopy Growth (CGC) moved lower by 21%, Tilray Brands Inc. (TLRY) dropped 14% and Curaleaf (CURLF) fell 5% and Trulieve Cannabis Corp. (TCNNF) shed 10.6%. TerrAscend Corp. (TSNDF) dropped 13.3% and Cresco Labs Inc. (CRLBF) declined by 4%.
The AdvisorShares Pure U.S. Cannabis ETF MSOS declined by 6.8% and the Amplify Alternative Harvest ETF MJ lost about 8.8% of its value.
In the previous session, Canopy Growth notched its second-largest one-day gain in the stock's history with a whopping 79% gain, on the heels of a report by the Associated Press that the Drug Enforcement Administration planned to lower the classification of pot to Schedule III from Schedule I.
Schedule III substances include ketamine and testosterone and are typically available through a doctor's prescription.
Since 1970, pot has been classified as Schedule I, with no health benefits, in the same bucket as heroin and LSD.
After the AP report, the U.S. Department of Justice issued a statement that Attorney General Merrick Garland circulated a proposal to reclassify marijuana to Schedule III.
"Once published by the Federal Register, it will initiate a formal rulemaking process as prescribed by Congress in the Controlled Substances Act," the statement said.
John Hartmann, chief executive of cannabis company Ascend Wellness Holdings (AAWH), told MarketWatch he expects the change in federal law to "have a dramatic affect on taxation and capital availability" to the industry.
"It's been anticipated for many years - it's a very positive step," he said. "We've been told by institutions and lenders they'd enter the sector."
While the process may take until 2025 to complete, the move by Garland marks a major step in the right direction, he said.
Meanwhile, Senate Majority Leader Chuck Schumer (D-NY), Senate Finance Committee Chairman Ron Wyden (D-OR), and Senator Cory Booker (D-NJ) said in a statement that they plan to reintroduce legislation to remove cannabis from the Controlled Substances Act.
Michael Harlow, managing partner of CohnReznik, who works on tax matters with cannabis companies, said the Schedule III designation raises questions around the 280E tax requirement that prevents dispensaries and other plant-touching businesses from taking standard tax deductions.
While the Schedule III status of pot would eliminate 280E, it's unknown whether companies will be able to reflect the change for the 2024 tax year or even past tax years for filings with the Internal Revenue Service, he said.
"I'd be shocked if the IRS has regulations ready to go to address this," he said. "The details still have to be worked out."
He said cannabis companies may be more aggressive in asking for 280E rebates or exemptions now that the federal government plans to remove cannabis from Schedule I.
Johnson & Johnsonon Wednesday proposed a plan to pay nearly $6.5 billion to resolve tens of thousands of lawsuits claiming that its cosmetic talc-based powder causes cancer.
Through a bankruptcy filing of its subsidiary company, LTL Management, J&J will be able to resolve about 99.75% of the pending talc lawsuits against the company and its affiliates in the U.S. Courts have rebuffed J&J's two previous efforts to resolve the lawsuits through the bankruptcy of the subsidiary created to absorb the company's talc liability.
The $6.47 billion would be paid out over 25 years, which J&J claims would be a "far better recovery than the claimants stand to recover at trial."
As of July 2023, the company was facing more than 34,000 lawsuits linking its baby powder to ovarian cancer, asbestos poisoning and other illnesses, FOX Business previously reported. Asbestos is a known cause of mesothelioma, a cancer that forms in the tissue that lines internal organs.
The company has maintained that its baby powder and other talc products don't cause cancer or contain asbestos,
"The company reiterates that none of the talc-related claims against it have merit. The claims are premised on the allegations that have been rejected by independent experts, as well as governmental and regulatory bodies, for decades," J&J said Wednesday.
However, lead lawyers for plaintiffs Leigh O'Dell and Michelle Parfitt, told Reuters in March that evidence showing the company's products caused cancer is "stronger than ever."
Bottles of Johnson & Johnson baby powder line a drugstore shelf in New York on Oct. 15, 2015. (REUTERS/Lucas Jackson / Reuters Photos)
The truth of J&J’s deceptive conduct to hide the presence of carcinogens in talcum powder and mislead the medical and scientific communities has only become clearer over time," the lawyers said in a statement.
In 2019, the Food and Drug Administration (FDA) alerted consumers that Johnson’s baby powder was under a voluntary recall after FDA testing found that a sample from one lot of the product contained chrysotile fibers, a type of asbestos.
Nearly all the suits the company is facing are related to ovarian cancer. The remaining pending personal injury lawsuits relate to mesothelioma, according to J&J.
Those suits are being addressed separately, though the company said it has resolved 95% of them to date.
British epidemiologist Peter Daszak, EcoHealth Alliance,is testifying today in front of Congress, where Congressional investigators will try and get to the bottom ofmultiple inconsistent statementshe's made about gain-of-function research which took place at the Wuhan Institute of Virology.
Watch live here (due to start at 1000ET):
Hours before Daszak's testimony, the House Select Subcommittee on the Coronavirus Pandemic released a staff-level report recommending that Daszak be formally disbarred and criminally investigated as a result of his actions prior to and during the COVID-19 pandemic. Key findings include:
EcoHealth used U.S. taxpayer dollars to facilitate gain-of-function research on coronaviruses at the Wuhan Institute of Virology in China.
EcoHealth violated the terms and conditions of its NIH grant by failing to report a potentially dangerous gain-of-function experiment conducted at the WIV.
EcoHealth also violated NIH grant requirements when it failed to submit a required research update report until nearly TWO YEARS after the NIH deadline.
The Trump Administration identified serious concerns with EcoHealth Alliance’s funding of the WIV and instructed NIH to fix the problem. Then, NIH terminated EcoHealth’s grant.
NIH is currently violating the terms of the WIV’s formal debarment by funding EcoHealth’s research.
Meanwhile on Monday, journalist Paul Thacker revealed a new set of documents which raise further questions into the work done by Daszak, as well as statements made by the National Institutes of Health regarding papers showing they funded risky virus research at the Wuhan Institute of Virology to create dangerous chimeric viruses.
As Thacker writes at The Disinformation Chronicle (which you should really subscribe to if you haven't already), and reprinted with permission (emphasis ours),
* * *
EcoHealth Alliance president Peter Daszak notified NIH funders that EcoHealth Alliance planned to conduct risky virus research at the Wuhan Institute of Virology (WIV), in a June 2016 letter, many months before a pause on such research was lifted in 2017. When the NIH released some of this information in 2021, they assured Congress and the public that these chimeric virus studies could not have led to the COVID virus, but they did so in a public statement that cited research the NIH itself had funded at the WIV.
The documents also show that, after once making a pretense of overseeing EcoHealth Alliance’s grants, the NIH is now happy to coordinate messaging with Peter Daszak’s nonprofit.
“Please pass this information on to the people at NIAID who need to coordinate communications,” Daszak wrote to NIH official Erik Stemmy, attaching a draft of a May 2023 press release. “And I'm available this evening, all day Friday and any time over the weekend to discuss.”
The 611 pages of new documents were provided to The DisInformation Chronicle by the whistleblower nonprofit Empower Oversight, which has sued the NIH to gain access to public records. Neither NIH spokeswoman Renate Myles nor EcoHealth Alliance’s Peter Daszak returned numerous requests for comment.
The NIH first withheld the 2019 report from The Intercept, only to later provide it after they were sued. The Intercept also discovered that the 2019 report was inexplicably dated August 2021.
That summary of the group’s work includes a description of an experiment the EcoHealth Alliance conducted involving infectious clones of MERS-CoV, the virus that caused a deadly outbreak of Middle East respiratory syndrome in 2012. MERS has a case-fatality rate as high as 35 percent, much higher than Covid-19’s. The scientists swapped out the virus’s receptor-binding domain, or RBD, a part of the spike protein that enables it to enter a host’s cells, according to the report. “We constructed the full-length infectious clone of MERS-CoV, and replaced the RBD of MERS-CoV with the RBDs of various strains of HKU4-related coronaviruses previously identified in bats from different provinces in southern China,” the scientists wrote.
After reviewing the documents for The Intercept, Jack Nunberg, a virologist and director of the Montana Biotechnology Center at the University of Montana, told reporters, “Changing the receptor binding site on MERS is sort of crazy.” Nunberg added, “Although these new chimeric viruses may retain properties of the MERS-CoV genetic backbone, engineering of a known human pathogen raises new and unpredictable risks beyond those posed by their previously reported studies using a non-pathogenic bat virus backbone.”
However, new documents show that EcoHealth Alliance proposed these experiments to the NIH’s Erik Stemmy in a June 2016 letter—three years before Chinese researchers at the WIV purportedly conducted them in 2019. This is also five years before EcoHealth Alliance submitted their report of these experiments to the NIH, which is dated August of 2021.
The date when these chimeric virus experiments were conducted is crucial, as the White House allegedly stopped funding these type of studies in 2014. MERS is known to infect and spread in humans, and was specifically designated under the NIH’s pause on funding gain-of-function research of concern.
“Public involvement in this deliberative process is key, and the process is thus designed to be transparent, accessible, and open to input from all sources,” reads the governments statement on the funding pause, which ended sometime in 2017.
However, in a June 2016 letter, almost a year before the pause was lifted, Daszak described these same risky experiments with MERS and SARS viruses that the White House alleged were no longer being funded. “We have provided the details you requested, below, including alternative strategies if we remove work that could be deemed gain of function,” Daszak wrote to the NIH’s Erik Stemmy.
While The Intercept reported that the WIV allegedly conducted the risky research in year five of the grant, Daszak told the NIH in the 2016 letter that the virus research was proposed for year 3 of the grant. This date should have placed the experiments within the timeframe when the White House had ceased funding such research—a pause which was lifted in 2017.
When The Intercept reported in 2021 on these virus experiments—alleged to have taken place in 2019—the NIH sent Congress a letter to explain reported discrepancies in risky research that EcoHealth Alliance conducted at the WIV.
“NIH says ‘no NIAID funding was approved for Gain of Function research at the WIV.’” Republicans on the House Oversight Committee tweeted, attaching a copy of the NIH’s letter. “Obviously, they were lied to. NIH confirmed today EcoHealth and the WIV conducted GOF research on bat coronaviruses.”
The NIH also posted a statement at that time claiming the WIV research they had funded could not have created the SARS virus that caused the pandemic.
The chimeric viruses that were studied (i.e., the WIV-1 virus with the various spike proteins obtained from bat viruses found in nature) were so far distant from an evolutionary standpoint from SARS-CoV-2 (Figure 1) that they could not have possibly been the source of SARS-CoV-2 or the COVID-19 pandemic.
The new documents also show that Congress and the media forced NIH officials to carefully script their responses about EcoHealth Alliance’s grants and research. The day before The Intercept’s story broke, NIH officials passed around flip cards for Anthony Fauci with a timeline of EcoHealth Alliance grants. NIH also included talking points Fauci could use regarding essays that had appeared in the Wall Street Journal and the Los Angeles Times.
“CLOSE HOLD: For Internal Use Only,” reads the October 21, 2021, NIH email subject line. “Final reactive statement and QA on the progress report are attached for use in responding to media and congressional inquiries,” Myles emailed.
An official in the NIH Director’s office emailed around news clippings the following day to keep everyone on message. “We anticipate more articles later today, and will update these clips with those articles once they pop. Let us know if you have questions.”
Emails show that The Intercept investigation also spurred multiple Hill briefings. “Last week NIH Deputy Director Larry Tabak briefed multiple Congressional committees on the Year 5 Progress Reports from the NIAID grant to EcoHealth Alliance,” reads a November email. “We received multiple follow-up questions (attached) that we would appreciate you taking a first pass at drafting responses.”
As has become NIH policy, much of the discussion in these emails is highly redacted, with entire pages sometimes blacked out.
To respond to an Inspector General audit of EcoHealth Alliance’s grants, NIH pulled in officials from all across the agency, including legislative affairs, the communications office, Anthony Fauci’s office, and the office of then-Director Francis Collins.
“Tracked changes show NIH OD edits to NIAID's most recent input as well as OCGR-Leg's recommended counter edits,” reads a November 2021 email.
By April of 2023, the NIH began coordinating directly with EcoHealth Alliance to prepare for renewal of the controversial grant that caused so many headaches. In an email to Peter Daszak, NIH’s Erik Stemmy advised him to update the grant’s language as reported in the NIH’s grants database to “reflect the revised work for that award.”
“No problem at all Erik,” Daszak responded. “Very happy to see that things will be moving forwards. We have a lot of work to do on the grants management extra oversight, but all that is fixable.”
Before submitting changes to the NIH database, Daszak ran the language past NIH’s Erik Stemmy on May 3. “Could you quickly read through and check - we can make further edits if you think there is anything here that could be worded better for the public understanding of our work, given that there will likely be interest in it.”
“Thanks for sharing the draft update, will get back to you ASAP!” Stemmy replied, later emailing Daszak, “Looks like it accurately reflects the renegotiation so please go ahead with the update.”
On May 4, 2023, Daszak forwarded Stemmy the draft of EcoHealth Alliance’s press statement announcing the grant renewal. “As per our Notice of Award requirements, and to make sure we can coordinate public discussion about the grant, I'm emailing to notify NIAID in advance that we're aiming to make a public statement.”
When EcoHealth Alliance published their announcement on May 8, 2023, the statement noted that they would not be conducting any gain-of-function virus experiments, the very research they had denied conducting in the past.
“It clarifies that the work does not involve recombinant virus technology, dual use research of concern, nor experiments intended to enhance the virulence or transmissibility of human pathogens (so-called ‘gain of function’ research).”
TIMELINE
JUNE 2016: Peter Daszak of EcoHealth Alliance notifies NIH that they plan to make chimeric MERS and SARS viruses in year 3 of a bat coronavirus grant.
2017: NIH lifts pause on research involving chimeric MERS and SARS viruses.
SEPTEMBER 2021: EcoHealth Alliance emails The Intercept that EcoHealth Alliance had not conducted MERS research. “The MERS work proposed in the grant is suggested as an alternative and was not undertaken.”
That same month, Peter Daszak emails several researchers and NIH officials that EcoHealth Alliance proposed the MERS research “and then pushed it to [year] 4. In the end we didn’t do this work.”
OCTOBER 20, 2021: To get out ahead of a coming investigation by The Intercept, NIH notifies Congress that EcoHealth Alliance performed risky research on chimeric MERS and SARS viruses “during the 2018-2019 grant period.”
OCTOBER 21, 2021: The Intercept reports that EcoHealth Alliance performed risky MERS studies in China, according to a year 5 grant report by EcoHealth Alliance.
That same day, the NIH alleges EcoHealth Alliance research conducted at the WIV could not have led to the pandemic, citing three peer reviewed studies the NIH and Chinese government had funded at the WIV.
MAY 2023: EcoHealth Alliance coordinates on public statements with NIH officials to announce the agency has renewed their grant, but the research will not involve risky research to make chimeric MERS and SARS viruses.
CVRx (NASDAQ:CVRX) stock is falling hard on Wednesday after posting results from its earnings report for the first quarter of 2024.
The bad news for investors in CVRX stock starts with its earnings per share of -$1.04. That’s much worse than the -54 cents per share Wall Street was expecting. It’s also wider than the -55 cents per share from the same period of the year prior.
Adding to this is CVRx’s revenue of $10.77 million. That’s another miss next to analysts’ estimate of $11.37 million for the quarter. However, it is up 35% year-over-year from $7.98 million.
CVRx’s guidance for the second quarter of 2024 has it expecting revenue to range from $11.3 million to $12.3 million. That would see it miss Wall Street’s Q2 revenue estimate of $13.12 million.
The company’s outlook for the full year of 2024 isn’t much better. It expects revenue for the year to come in between $50 million and $53 million. That would also fail to reach analysts’ estimate of $55.21 million for the year.
Announces Commercial Launch of Two New Thrombectomy Devices for the Venous and Arterial Vasculatures: Pounce™ Venous and Pounce LP (Low Profile)
Surmodics, Inc. (Nasdaq: SRDX), a leading provider of medical device and in vitro diagnostic technologies to the healthcare industry, today reported financial results for its second quarter ended March 31, 2024, and updated financial guidance for its fiscal year ending September 30, 2024.
Second Quarter Fiscal 2024 Financial Summary
Total Revenue of $32.0 million, an increase of 18% year-over-year
Total Revenue excluding SurVeil™ drug-coated balloon (“DCB”) license fee revenue(1) of $30.9 million, an increase of 19% year-over-year
GAAP net income of $0.2 million, compared to a net loss of $(7.7) million in the prior-year period
Adjusted EBITDA(2) of $4.8 million, compared to $(1.5) million in the prior-year period
Second Quarter and Recent Business Highlights
On January 22, 2024, Surmodics announced the successful early clinical use and limited market evaluation (LME) of the Pounce LP (Low Profile) Thrombectomy System, which is designed for removal of acute-to-chronic thrombi and emboli in peripheral arteries ranging from 2 mm to 4 mm, such as those found below the knee.
Today, Surmodics is announcing the completion of LME and commercial launch of two new mechanical thrombectomy systems for the peripheral venous and arterial vasculatures, the Pounce Venous Thrombectomy System and the Pounce LP Thrombectomy System.
The Pounce Venous Thrombectomy System, which transitioned to commercial launch in March, is designed to remove mixed-morphology, wall-adherent peripheral venous clot in a single treatment session while minimizing the need for thrombolytics.
The Pounce LP Thrombectomy System, which transitioned to commercial launch in April, addresses an important unmet need for the prompt removal of acute-to-chronic thrombi or emboli in below-the-knee arteries 2 to 4 mm in diameter while minimizing the need for thrombolytics.
