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US Online Spending Jumps $24.1 Billion During “Black Friday in Summer,” Adobe Reports

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U.S. online retail spending surged by $24.1 billion from July 8 to 11, a period dubbed “Black Friday in Summer,” exceeding Adobe Analytics’ forecast as shoppers eagerly took advantage of steep discounts on back-to-school items. Retailers saw a 30.3% increase in online sales during events including Amazon Prime Day, surpassing Adobe’s earlier projection of 28.4%.

Online retail sales a year ago during this period were $14.2 billion, marking an 11% rise this time. Prime Day has solidified its role as a key back-to-school shopping moment, with consumers grabbing early deals to prepare for the upcoming school season, Adobe noted.

Major retailers such as Amazon, Walmart, Target, and Best Buy launched extensive deal events offering significant discounts, encouraging shoppers to purchase higher-priced items they might normally avoid. Amazon extended its sales window to 96 hours, doubling the usual 48-hour timeframe, and ran aggressive promotions across categories like apparel and electronics.

This surge in deals comes amid ongoing trade tensions and tariff uncertainties under the Trump administration, as well as a looming August 1 deadline for renegotiations of trade agreements with the U.S.

Mobile shopping dominated the Prime Day event, accounting for 53.2% of online sales—above Adobe’s forecast of 52.5%. Discounts ranged from 11% to 24%, slightly wider than the previously forecast 10% to 24%. Apparel saw the largest discounts at 24%, up from 20% last year, while electronics held steady at a 23% discount, similar to the prior year.

Foxconn Posts Record Q2 Revenue Driven by AI Demand but Warns on Geopolitical and Currency Risks

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Taiwan’s Foxconn, the world’s largest contract electronics manufacturer and Apple’s main iPhone assembler, reported record revenue for the second quarter, boosted by strong demand for artificial intelligence (AI) related products. However, the company also flagged potential headwinds from geopolitical tensions and currency fluctuations.

Key Points:

  • Revenue Performance:
    Foxconn’s Q2 revenue rose 15.82% year-on-year to T$1.797 trillion (Taiwan dollars), surpassing analyst expectations (LSEG SmartEstimate: T$1.7896 trillion). June alone saw revenue climb 10.09% year-on-year to a record T$540.237 billion.

  • Drivers of Growth:

    • The surge in demand for AI-related cloud and networking products, including components for Nvidia’s AI chips, was a major growth driver.

    • Revenue from smart consumer electronics, including iPhones, was flat year-on-year, impacted by adverse exchange rate movements.

  • Outlook and Risks:
    Foxconn expects continued growth in the current quarter compared to previous quarters and last year but remains cautious about risks posed by evolving global political situations and foreign exchange volatility.
    The company did not provide specific numerical forecasts.

  • Geopolitical Context:
    The announcement comes amid heightened U.S. tariffs and trade tensions, with U.S. President Trump recently notifying 12 countries about potential tariff levels on their exports to the U.S., potentially affecting global supply chains.

  • Operational Footprint:
    Foxconn operates the world’s largest iPhone manufacturing facility in Zhengzhou, China.

  • Stock Market Impact:
    Despite last year’s strong 76% stock rally outperforming the Taiwan market, Foxconn’s shares have fallen 12.5% so far this year amid broader tech sector volatility influenced by trade policy concerns. The stock fell 1.83% on Friday ahead of the earnings announcement.

  • Next Steps:
    Full Q2 earnings will be released on August 14.

Chip Design Software Stocks Surge After US Lifts Export Curbs on China

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Shares of major chip design software companies Synopsys and Cadence Design Systems rose sharply on Thursday following the U.S. government’s decision to lift export restrictions on chip design software exports to China, alleviating market uncertainties and preserving access to a critical revenue source.

Market Impact

  • The restrictions, introduced in late May, had cut off over 10% of revenue for these companies, negatively impacting forecasts and share prices.

  • Analysts from Mizuho noted the export resumption will limit revenue loss to just one month in the current quarter.

  • The easing of trade tensions could facilitate China’s approval of Synopsys’s $35 billion acquisition of engineering software firm Ansys, a deal pending regulatory clearance primarily in China.

Stock Movements

  • Synopsys shares rose 5.5%, despite ongoing assessments of export curbs’ financial impacts.

  • Cadence Design Systems surged 6.1%, reaching a record high of $330.09.

  • Ansys gained around 3.5%, while Germany’s Siemens, another key player in electronic design automation (EDA), rose 1.5%.

Expert Insights and Context

  • Susannah Streeter of Hargreaves Lansdown described the move as “a distinct warming of relations and a small ceasefire in the chips war.”

  • However, she cautioned that it does not represent a broad easing of restrictions on high-end chip exports, especially from companies like Nvidia.

  • U.S. concerns persist over China’s technological advancements and potential military applications of American chip technology.

  • The curbs have driven increased domestic chip design efforts in China, supported by state subsidies, raising fears of retaliatory actions that could affect regulatory decisions like the Synopsys-Ansys deal.

Deal Deadline

  • The Synopsys-Ansys merger has been cleared in all jurisdictions except China, with a closure deadline of July 15 and an option to extend to January next year.