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The recent earnings calls of the world’s two largest memory chipmakers signaled that weak demand may have finally bottomed out.

Samsung’s operating profit in the third quarter jumped 262.6% as compared to the second quarter. This followed a 85.15% drop in first quarter operating profit from the previous quarter and a small 4.68% improvement in second-quarter operating profit from the first quarter.

SK Hynix in its quarterly report said that its dynamic random-access memory business returned to profit in the third quarter, after losses in the first two quarters of this year.

“One of the big drivers of memory price recovering is industry-wide supply reduction and thus falling inventories,” James Lim, senior research analyst at Dalton Investments, told CNBC.

“Inventories at personal computer and mobile customers seem to have come down a lot and very low memory prices tend to induce restocking or having more memory content per device,” said Lim.

The South Korean companies are the world’s two largest makers of DRAM chips, according to data from market research firm TrendForce, with U.S.-based Micron trailing in third place. Such memory chips are found in consumer devices such as laptops and smartphones.

“We received numerous purchase inquiries amid widening awareness of the industry reaching a bottom, following the industry-wide production cuts,” Samsung said in its earnings report last week. Chipmakers have been running down excess inventories by scaling back production.

During the pandemic, companies stockpiled memory chips to meet record electronics demand, but were left with excess inventory when that pressure eased. Inflation has caused consumers to rein in spending and cut back on purchases of consumer devices, driving down demand and prices for memory chips.

Micron is building the biggest-ever U.S. chip fab, despite China ban

Kazunori Ito, director of research at Morningstar, said that “earnings calls confirmed that the memory industry has bottomed out as expected.”

“DRAM average selling prices, or ASPs, rose by midsingle digits for Samsung and 10% for SK Hynix, sequentially, and it was the first time in eight quarters that Samsung experienced a price increase,” Ito said in a Nov. 1 report.

“We have made minor adjustments to our earnings forecasts for South Korean memory suppliers,” Ito said. The financial services firm added that Samsung’s shares are “undervalued” while SK Hynix’s shares “have about 18%-20% upside to our fair value estimate.”

Other chipmakers have also projected strong outlooks.

The world’s largest contract chipmaker Taiwan Semiconductor Manufacturing Company exceeded analysts’ expectations and predicted the worst could soon be over for the chip industry. TSMC makes the most advanced processors for companies like Apple and Nvidia based on Arm‘s architecture.

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U.S.-based Qualcomm also gave a strong forecast for the current quarter, pointing to a chip recovery. Qualcomm makes the processors at the heart of most high-end Android devices and many lower-end phones as well.

“Although inventory levels peaked in mid-2023, they are still at the high levels, especially for NAND [flash memory],” Ito of Morningstar said.

NAND is another important memory chip that often works together with DRAM in PCs, servers and smartphones. It stores data but does not require power like DRAM.

“As a result, memory suppliers are expected to continue maintaining lower capacity utilization and to remain cautious about increasing production capacity next year, which should be favorable for memory prices due to limited supply,” Ito said.

TrendForce said it expects memory suppliers to continue “scaling back production of both DRAM and NAND Flash in 2024,” in particular in the “financially struggling NAND Flash sector.” The research firm also projected DRAM and NAND Flash demand to increase by 13% and 16% respectively in 2024.

AI boom to uplift profits

In the third quarter, strong demand for advanced, high-performance chips in generative AI has helped offset a slowdown for chips found in computers and smartphones, SK Hynix said in its earnings report.

“On servers, AI demand has been another strong driver,” said Lim of Dalton Investments.

ChatGPT and other large language models need a lot of advanced memory chips, which enable such generative AI models to remember details from past conversations and user preferences in order to generate humanlike responses.

“DRAM business … is expected to continue to improve along with the generative AI boom. The NAND flash business, which continues to suffer losses, is also showing signs of improvement,” SK Hynix said in a statement.

On the outlook for memory demand, Samsung said it expects fourth-quarter demand to pick up with year-end promotions, new product launches by its major customers as well as strong demand for generative AI.

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How TikTok’s rise sparked a short-form video race

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How TikTok’s rise sparked a short-form video race

TikTok’s grip on the short-form video market is tightening, and the world’s biggest tech platforms are racing to catch up.

Since launching globally in 2016, ByteDance-owned TikTok has amassed over 1.12 billion monthly active users worldwide, according to Backlinko. American users spend an average of 108 minutes per day on the app, according to Apptoptia.

TikTok’s success has reshaped the social media landscape, forcing competitors like Meta and Google to pivot their strategies around short-form video. But so far, experts say that none have matched TikTok’s algorithmic precision.

“It is the center of the internet for young people,” said Jasmine Enberg, vice president and principal analyst at Emarketer. “It’s where they go for entertainment, news, trends, even shopping. TikTok sets the tone for everyone else.”

Platforms like Meta‘s Instagram Reels and Google’s YouTube Shorts have expanded aggressively, launching new features, creator tools and even considering separate apps just to compete. Microsoft-owned LinkedIn, traditionally a professional networking site, is the latest to experiment with TikTok-style feeds. But with TikTok continuing to evolve, adding features like e-commerce integrations and longer videos, the question remains whether rivals can keep up.

“I’m scrolling every single day. I doom scroll all the time,” said TikTok content creator Alyssa McKay.

But there may a dark side to this growth.

As short-form content consumption soars, experts warn about shrinking attention spans and rising mental-health concerns, particularly among younger users. Researchers like Dr. Yann Poncin, associate professor at the Child Study Center at Yale University, point to disrupted sleep patterns and increased anxiety levels tied to endless scrolling habits.

“Infinite scrolling and short-form video are designed to capture your attention in short bursts,” Dr. Poncin said. “In the past, entertainment was about taking you on a journey through a show or story. Now, it’s about locking you in for just a few seconds, just enough to feed you the next thing the algorithm knows you’ll like.”

Despite sky-high engagement, monetizing short videos remains an uphill battle. Unlike long-form YouTube content, where ads can be inserted throughout, short clips offer limited space for advertisers. Creators, too, are feeling the squeeze.

“It’s never been easier to go viral,” said Enberg. “But it’s never been harder to turn that virality into a sustainable business.”

Last year, TikTok generated an estimated $23.6 billion in ad revenues, according to Oberlo, but even with this growth, many creators still make just a few dollars per million views. YouTube Shorts pays roughly four cents per 1,000 views, which is less than its long-form counterpart. Meanwhile, Instagram has leaned into brand partnerships and emerging tools like “Trial Reels,” which allow creators to experiment with content by initially sharing videos only with non-followers, giving them a low-risk way to test new formats or ideas before deciding whether to share with their full audience. But Meta told CNBC that monetizing Reels remains a work in progress.

While lawmakers scrutinize TikTok’s Chinese ownership and explore potential bans, competitors see a window of opportunity. Meta and YouTube are poised to capture up to 50% of reallocated ad dollars if TikTok faces restrictions in the U.S., according to eMarketer.

Watch the video to understand how TikTok’s rise sparked a short form video race.

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Elon Musk’s xAI Holdings in talks to raise $20 billion, Bloomberg News reports

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Elon Musk's xAI Holdings in talks to raise  billion, Bloomberg News reports

The X logo appears on a phone, and the xAI logo is displayed on a laptop in Krakow, Poland, on April 1, 2025. (Photo by Klaudia Radecka/NurPhoto via Getty Images)

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Elon Musk‘s xAI Holdings is in discussions with investors to raise about $20 billion, Bloomberg News reported Friday, citing people familiar with the matter.

The funding would value the company at over $120 billion, according to the report.

Musk was looking to assign “proper value” to xAI, sources told CNBC’s David Faber earlier this month. The remarks were made during a call with xAI investors, sources familiar with the matter told Faber. The Tesla CEO at that time didn’t explicitly mention any upcoming funding round, but the sources suggested xAI was preparing for a substantial capital raise in the near future.

The funding amount could be more than $20 billion as the exact figure had not been decided, the Bloomberg report added.

Artificial intelligence startup xAI didn’t immediately respond to a CNBC request for comment outside of U.S. business hours.

Faber Report: Elon Musk held call with current xAI investors, sources say

The AI firm last month acquired X in an all-stock deal that valued xAI at $80 billion and the social media platform at $33 billion.

“xAI and X’s futures are intertwined. Today, we officially take the step to combine the data, models, compute, distribution and talent,” Musk said on X, announcing the deal. “This combination will unlock immense potential by blending xAI’s advanced AI capability and expertise with X’s massive reach.”

Read the full Bloomberg story here.

— CNBC’s Samantha Subin contributed to this report.

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Alphabet jumps 3% as search, advertising units show resilient growth

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Alphabet jumps 3% as search, advertising units show resilient growth

Alphabet CEO Sundar Pichai during the Google I/O developers conference in Mountain View, California, on May 10, 2023.

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Alphabet‘s stock gained 3% Friday after signaling strong growth in its search and advertising businesses amid a competitive artificial intelligence environment and uncertain macro backdrop.

GOOGL‘s pace of GenAI product roll-out is accelerating with multiple encouraging signals,” wrote Morgan Stanley‘s Brian Nowak. “Macro uncertainty still exists but we remain [overweight] given GOOGL’s still strong relative position and improving pace of GenAI enabled product roll-out.”

The search giant posted earnings of $2.81 per share on $90.23 billion in revenues. That topped the $89.12 billion in sales and $2.01 in EPS expected by LSEG analysts. Revenues grew 12% year-over-year and ahead of the 10% anticipated by Wall Street.

Net income rose 46% to $34.54 billion, or $2.81 per share. That’s up from $23.66 billion, or $1.89 per share, in the year-ago period. Alphabet said the figure included $8 billion in unrealized gains on its nonmarketable equity securities connected to its investment in a private company.

Adjusted earnings, excluding that gain, were $2.27 per share, according to LSEG, and topped analyst expectations.

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Alphabet shares have pulled back about 16% this year as it battles volatility spurred by mounting trade war fears and worries that President Donald Trump‘s tariffs could crush the global economy. That would make it more difficult for Alphabet to potentially acquire infrastructure for data centers powering AI models as it faces off against competitors such as OpenAI and Anthropic to develop largely language models.

During Thursday’s call with investors, Alphabet suggested that it’s too soon to tally the total impact of tariffs. However, Google’s business chief Philipp Schindler said that ending the de minimis trade exemption in May, which created a loophole benefitting many Chinese e-commerce retailers, could create a “slight headwind” for the company’s ads business, specifically in the Asia-Pacific region. The loophole allows shipments under $800 to come into the U.S. duty-free.

Despite this backdrop, Alphabet showed steady growth in its advertising and search business, reporting $66.89 billion in revenues for its advertising unit. That reflected 8.5% growth from the year-ago period. The company reported $8.93 billion in advertising revenue for its YouTube business, shy of an $8.97 billion estimate from StreetAccount.

Alphabet’s “Search and other” unit rose 9.8% to $50.7 billion, up from $46.16 billion last year. The company said that its AI Overviews tool used in its Google search results page has accumulated 1.5 billion monthly users from a billion in October.

Bank of America analyst Justin Post said that Wall Street is underestimating the upside potential and “monetization ramp” from this tool and cloud demand fueled by AI.

“The strong 1Q search performance, along with constructive comments on Gemini [large language model] performance and [AI Overviews] adoption could help alleviate some investor concerns on AI competition,” Post wrote in a note.

WATCH: Gemini delivering well for Google, says Check Capital’s Chris Ballard

Gemini delivering well for Google, says Check Capital's Chris Ballard

CNBC’s Jennifer Elias contributed to this report.

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