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Trade Wars
China’s Factory Activity Unexpectedly Contracts In July On Demand Slump, Typhoons
China’s factory activity unexpectedly contracted in July for the first time since February, as domestic orders slumped and typhoons disrupted production, while part of the front-loading momentum began to unwind, piling pressure on Beijing to boost domestic demand. The official manufacturing purchasing managers’ index fell to 49.2 from 50.3 in June, National Bureau of Statistics data showed Friday, dropping below the 50-point threshold that separates expansion from contraction. Economists’ median forecast had pegged PMI at 50. The gauge — the weakest since February — ended a four-month run at or above 50, a stretch propped up by exporters rushing shipments ahead of U.S. tariff increases.
The headline figure was dragged down by the new orders sub-index, which fell to 48.5, the lowest in 38 months, according to official data accessed via Wind. The sub-index for factory-gate prices extended its decline after a brief war-driven energy spike earlier this year, signaling producer price weakness. Weakness spread well beyond manufacturing. The construction PMI slumped to a record low of 47.0, the services gauge fell to its weakest since the initial Covid-19 lockdowns, and the composite PMI dropped to 49.3, the lowest since the pandemic ended in 2022, Wind data showed. A statistics bureau spokesperson attributed part of the PMI weakness to a recent spate of typhoons that halted work on many projects.
Read more at CNBC
IBM CEO Says Quantum Computing Will Have A ‘Measurable Impact’ On Earnings By 2028 Or 2029
IBM CEO Arvind Krishna said Thursday investors won’t have to wait much longer for quantum computing to become a meaningful business for the technology company known for its mainframes and enterprise software. “I think that in 2028 or 2029, you’ll see it have a measurable impact on our top line and bottom line,” Krishna said on CNBC’s “Mad Money.” “By the end of the 2030s, we are now pretty convinced this is a trillion dollars of value.” On Thursday, IBM and startup Algorithmiq unveiled new research demonstrating what the companies described as quantum advantage, showing a quantum computer could solve certain computational problems more efficiently than today’s leading classical computers while also verifying the results.
While skeptics argue quantum computing remains years away from practical commercialization because of challenges including high error rates, hardware complexity and scalability, Krishna said IBM is already seeing meaningful progress toward real-world applications. In May, the company announced plans to develop a standalone quantum chip foundry backed by a $1 billion commitment from the U.S. Department of Commerce through the CHIPS incentive, along with a matching $1 billion investment from IBM.
Read more at CNBC
Key Earnings Reports
Stellantis reported operating income more than tripled year-on-year for the second quarter of 2026, driven by strong revenue growth in North America. The automaker’s July 30 report shows adjusted operating income for the April to June period was 773 million euros ($882 million) compared to just 213 million euros for the same period in 2025. The group’s net revenues for Q2 2026 increased to 43.5 billion euros, up 13% YoY, with North America up 32% and South America up 6%. Enlarged Europe was flat while both the Middle East & Africa and Asia Pacific regions were down. – Ward’s Auto
Amazon reported surging cloud growth during the second quarter, pointing to strong artificial intelligence demand, and the company boosted its capital spending forecast for the year. Earnings per share were $1.97 adjusted vs. $1.82 estimated and revenue was $200.61 billion vs. $196.47 billion estimated. Amazon Web Services earned $42.2 billion vs. $40.54 billion expected, according to StreetAccount, and advertising was: $19.81 billion vs. $19.43 billion expected, according to StreetAccount. Amazon said it expects to spend even more on AI, with capital expenditures projected to hit $220 billion this year, CEO Andy Jassy said on a conference call with investors. In February, the company said capex would hit $200 billion this year, and it held steady on that forecast in April. - CNBC
Corning reported earnings per share before the bell on Tuesday of 78 cents versus estimates of 76 cents. Revenue came in at $4.74 billion, also topping the Street’s estimates of $4.61 billion. Despite the company posting a beat on the top and bottom lines, revenue forecasts for the current quarter fell below Wall Street’s consensus. The company expects core revenue to grow 16%, a range of $4.9 billion to $5 billion. Factset expected $5 billion. CNBC
L3Harris Technologies posted EPS of $3.63, beating estimates of $2.78 by $0.85, while revenue of $5.88B topped consensus by approximately $58M, compared with $5.43B in the year-ago quarter, supported by solid demand across its defense portfolio. Seeking Alpha
General Dynamics reported EPS of $4.24, beating estimates of $3.74 by $0.50, while revenue of $14.09B exceeded expectations by about $550M, up from $13.04B in the prior-year quarter, helped by growth across its aerospace and defense businesses. Seeking Alpha
Pentagon Expands Patriot Missile Order to $58B
The Pentagon will award up to $58.6 billion to Lockheed Martin to manufacture and supply of PAC-3 Missile Segment Enhancement (MSE) interceptors over a seven-year period, 2026 through 2032. The assignment is modification to an April contract, in line with the Acquisition Transformation Strategy that the U.S. Dept. of War implemented earlier this year. The ongoing war with Iran has precipitated a shortage of critical missile systems, including the Patriot interceptors, according to various reports citing Pentagon and White House sources. The missile inventory has also been affected by U.S. supplying Ukrainian forces since the Russian invasion of that country in 2022.
The PAC-3 MSE missiles and their critical components, like rocket motors and guidance systems are among the Pentagon purchases included in the new framework agreements it coordinated with several major defense contractors, to incentivize them to accelerate production and increase investments in new manufacturing capacity for missile systems. According to Lockheed, the contract modification will mean it is able “to supercharge PAC-3 MSE production and triple capacity by the end of 2030.” The manufacturer further highlighted its plan to increase employment by 50% (from 1,200 to approximately 1,850) at the Camden, Ark., where it produces the PAC-3 MSE interceptors.
Read more at American Machinist
F-47 Program Producing Test Aircraft, On Schedule For 2028 Flight
The U.S. Air Force’s F-47 program has begun its engineering and manufacturing development phase and will fly in the coming years, a service official said. The first Boeing F-47 is on track for its first flight in 2028. The Air Force plans to buy at least 185 F-47s, matching the size of the F-22 Raptor fleet it intends to replace. The program, described as “extreme teaming” with industry partners, entered the phase with “unprecedented maturity,” Gen. Dale White, director of Critical Major Weapon Systems, said in a Wednesday keynote address at an event in Dayton, Ohio.
The engineering and manufacturing phase includes maturing, integrating and testing all parts of the F-47. It will produce a small number of test aircraft for evaluation and includes priced options for low-rate initial production. White did not specify the number of test aircraft being produced. The F-47 program was allotted $3.45 billion in fiscal year 2026 funding and over $5 billion in the fiscal 2027 budget request.
Read more at Defense News
Caterpillar Announces $10M Workforce Commitment In Illinois
Caterpillar has announced an up to $10 million workforce commitment in Illinois, part of its five-year Building the Future Workforce Initiative. The funding aims to prepare workers across the state for the modern manufacturing and industry technician jobs of the future, the company said. The effort will extend across multiple communities where ‘Big Yellow’ has a manufacturing footprint, including East Peoria, Mapleton, Morton, Pontiac and Decatur.
Caterpillar outlined four areas the funds will target: generating interest in manufacturing careers, leveraging resources to strengthen local learning institutions, improving access and affordability to training programs, and sharing the results of the investments with the public. “Caterpillar’s roots run deep in Illinois, and so does our commitment to building a strong and skilled workforce,” said Christy Pambianchi, Caterpillar’s chief human resources officer. “This investment builds on that legacy, helping ensure people have a clear path to manufacturing careers today while equipping the next generation of Illinoisans with the skills they need to succeed.”
Read more at News 25
Has Physical AI Gone ‘Mainstream’? One New Survey Says Yes
Newly released TCS report claims manufacturers have begun to substantively scale the kind of AI that doesn’t stay behind a screen but that interacts with sensors and physical processes and parts like automation and robotics. Broadly, according to Mumbai-headquartered Tata Consultancy Services from its Future-Ready Manufacturing: TCS Physical AI Readiness Report, these manufacturers are using physical AI in people-first digital transformations, meaning that instead of the processes replacing the workforce, “manufacturers are using intelligent systems to help employees work more safely, efficiently, and productively while supporting workforce redeployment where needed in a human plus AI operating model.”
No organization surveyed plans to reduce physical AI investment, while 26% plan to increase spending.
68% of manufacturers remain in non-deployment or experimental stages.
A high impact is expected in warehouse operations. Of the respondents, 77% anticipate significant or transformational impact, followed by assembly and manufacturing operations at 75% and logistics and material movement at 72%.
C-suite-level people and VPs from 300 manufacturing companies across North America and Europe were surveyed in March and April.
Read more at Smart Industry
Resilience And Lilly Invest $750M To Scale Cincinnati Medicine Output
Resilience and Eli Lilly are investing $750 million to increase domestic medicine production in the Cincinnati region, including additional capacity for GLP-1 weight-loss injectables, the companies said Thursday. Their joint investment allows contract manufacturer Resilience to produce Lilly’s KwikPen injectable device for medicines that treat diabetes and obesity, according to a news release. The expansion will create at least 400 jobs, bringing Resilience’s total headcount to more than 1,400 across its two facilities.
Since their partnership began in 2023, the companies said they have produced more than 150 million doses of medicines for U.S. patients in vial and pre-filled syringe formats. Site preparation for the expansion is underway with full operations expected to begin in early 2027. The investment comes amid growing demand for GLP-1 medications that treat diabetes, obesity and other conditions. Lilly and other biopharmaceutical giants are pouring billions of dollars into their operational footprints to ensure they have enough capacity to meet demand. Resilience has become a key partner in helping Lilly address its supply needs in recent years.
Read more at Manufacturing Dive
Commonwealth Fusion Secures $1B Capital Raise To Set Stage For Chesterfield Virginia Power Plant
An MIT-born startup’s plan to build the world’s first nuclear fusion power plant in Chesterfield just got a 10-figure jolt. Commonwealth Fusion Systems announced Thursday it has secured $1 billion in financing to fuel its efforts to open a Chesterfield-based commercial-scale power plant, which the company calls ARC, in the coming years. The local project comes as the company eyes completion of its prototype fusion machine, known as SPARC, at its Massachusetts headquarters.
The 400-megawatt fusion plant would be built on 25 to 40 acres of an overall 94-acre property owned by Dominion Energy in the Chester area. CFS has previously said it has signed a lease option for the site and would pay for and own the facility. Nuclear fusion, which involves the collision and fusion of atomic nuclei, is how the sun generates energy. Replicating the process at a commercial scale with man-made technology has been studied for decades but hasn’t yet been achieved. Fusion is considered a renewable energy source and safer than today’s nuclear fission, which involves the splitting of atoms and results in long-lasting, highly radioactive waste. Fusion doesn’t cause meltdowns or the create greenhouse gases.
Read more at Richmond Biz
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