By Victoria Waldersee

WOLFSBURG, Germany (Reuters) – Volkswagen (ETR:VOWG_p)’s union called on management to take a “big step” in a third round of negotiations over pay and factory closures on Thursday, with positions appearing still far apart days before workers threatened strikes across German sites.

Thousands of employees gathered as talks began over wages for 120,000 of Volkswagen’s roughly 300,000 staff in Germany, employed at six plants governed by a separate collective wage agreement to the rest of the workforce.

Volkswagen has demanded a 10% wage cut, arguing it needs to slash costs and boost profit to defend market share in the face of cheap competition from China and a drop in European car demand. It is also threatening to close plants in Germany for the first time in its 87-year history.

The troubles at Europe’s largest automaker have fed wider anxieties about Germany’s status as an industrial powerhouse in the run-up to a snap election in February in which Chancellor Olaf Scholz’s economic record is under scrutiny.

Unions on Wednesday proposed forgoing bonuses for two years and creating a fund to finance a temporary reduction in working hours in less productive areas of the business. They said these measures would avoid redundancies and save 1.5 billion euros ($1.6 billion).

But the proposal was contingent on management ruling out plant closures, which Volkswagen has refused to do.

“A solution before Christmas relies on the other side making a big step towards one today,” said IG Metall union negotiator Thorsten Groeger.

“If IG Metall wants, the factory lines will stand still.”

If management rejects their proposal, unions – a powerful force at Volkswagen, controlling half the seats on its supervisory board – will demand a 7% pay rise alongside no plant closures.

If their demands are not met, workers could strike from December across German sites, the first large-scale strikes at the German business – VW AG – since 2018 when over 50,000 workers took to the streets over pay.

“We welcome that worker representatives are signalling openness to measures on labour costs and overcapacity … We will go into a detailed exchange in the negotiations,” Volkswagen board member Gunnar Kilian said in a statement.

AUTOMAKERS STRUGGLING

Thousands of workers from various cities gathered in the soccer stadium in Wolfsburg, where Volkswagen is headquartered, on Thursday morning, blowing whistles, waving flags and whooping and booing. Sausages and pretzels were served in near freezing temperatures outside.

The large crowd of workers “is just a taste of what would come in December,” VW AG works council chief Daniela Cavallo said.

Company and industry data reviewed by Reuters showed that the automaker spends a higher proportion of sales on labour costs than its major rivals.

But others are also struggling.

Ford (NYSE:F) said on Wednesday it would cut around 14% of its European workforce.

Volkswagen’s preferred shares, listed in Germany’s blue-chip DAX index fell 1.4% to their lowest level since Nov. 13. The company’s common stock, majority owned by Porsche SE – the holding firm controlled by the Porsche and Piech families – declined 1% to its lowest level in over 13 years.

Unions have called on Volkswagen’s key owners to pitch in on savings, something Stifel analysts said would be negative for biggest shareholder Porsche SE.

The union proposal “seems some way off what we assume VW management hopes to achieve in the negotiations,” a note from Stifel said.

Claudia Jobe, a member of the VW works council at the Hanover plant, said management had changed its tune since she joined the company in 1991 to making unilateral decisions in the interests of shareholders, not workers.

“You’re also afraid, you’ve been at the plant for so many years and it all counts for nothing,” she said, adding that she was pessimistic on the outcome of Thursday’s talks.

“I expect we might have to go on a warning strike from December.”

($1 = 0.9494 euros)

Investing.com — Citi has placed Nvidia (NASDAQ:NVDA) on a 90-day Upside Catalyst Watch ahead of CES in January 2025.

The bank anticipates key announcements from Nvidia during the event, including updates on its Blackwell product line, improvements in gross margins, and growth opportunities in AI-driven industrial and robotics applications.

Citi noted that Nvidia delivered a “beat and raise,” with October quarter revenue reaching $35 billion, beating expectations of $34 billion. The company’s guidance for the January quarter was $37.5 billion, aligning with market forecasts.

The investment bank’s analysts said Nvidia’s management addressed several critical topics during its earnings call. These included the accelerating Blackwell ramp, which is expected to contribute significantly to January-quarter sales, and the trajectory for gross margins, which are projected to trough in the April quarter before recovering to the mid-70% range in the second half of the fiscal year.

Citi highlighted Nvidia’s continued strength in AI scaling across pre-training, post-training, and inference, which is expected to fuel growing demand for compute power.

Although networking demand declined quarter-over-quarter due to supply chain issues in optics, Citi expects a rebound in the January quarter.

Citi analysts are optimistic about Nvidia’s prospects at CES. They noted, “NVIDIA CEO Jensen Huang will give the opening keynote on Jan 6th and the company is hosting a financial analyst Q&A on Jan 7th.”

The firm expects Nvidia to outline increased Blackwell sales expectations, address the anticipated margin recovery, and discuss a “demand inflection” for AI-driven robotics in warehouses, manufacturing, and humanoid applications.

Citi maintains a Buy rating on Nvidia, raising its price target to $175 from $160, reflecting the company’s consistent 35x P/E multiple and projected earnings growth.

(Reuters) -Deere & Co forecast lower-than-expected 2025 profit on Thursday, as sagging farm incomes and inflationary pressures affect demand for the company’s tractors and other agricultural equipment.

A decline in farm incomes, high interest rates and an uncertain economy have compelled farmers to reassess large expenses on agricultural machinery and forced dealers to limit inventory restocking.

U.S. farm income is expected to fall for a second consecutive year in 2024, as farmers grapple with corn and soybean prices hovering near four-year lows.

The U.S. Department of Agriculture estimates this year’s net farm income, a broad measure of profitability in the agricultural economy, to hit $140 billion, down 4.4% or $6.5 billion from a year earlier.

“Amid significant market challenges this year, we proactively adjusted our business operations to better align with the current environment,” CEO John May said.

The world’s largest farm-equipment maker expects profit for fiscal year 2025 in the range of $5 billion to $5.5 billion, compared with analysts’ average estimate of $5.93 billion, according to data compiled by LSEG.

For 2025, Deere (NYSE:DE) expects net sales to fall about 10% to 15% across all its machinery segments.

Concerns around supply chains and a surge in demand led dealers to significantly increase their inventories last year, boosting sales for Deere, which primarily sells its agricultural and construction equipment through independent and franchised dealers.

However, amid the recent demand slowdown, skeptical dealers have slowed inventory restocking.

The company reported a net income of $1.25 billion, or $4.55 per share, compared with $2.37 billion, or $8.26 per share, a year earlier.

Fourth-quarter worldwide net sales and revenue fell 28% to $11.14 billion.

NEW DELHI (Reuters) – Indian billionaire Gautam Adani has been indicted by U.S. prosecutors for conspiring with executives of a formerly New York listed company to devise a $265 million scheme to bribe Indian officials to boost their solar energy business.

Adani Group denied the allegations as “baseless”, while Indian government officials haven’t commented so far.

Here is an overview of the investigation and allegations revealed in the U.S. indictment:

WHAT ARE THE MAIN ALLEGATIONS?

U.S. prosecutors charged Gautam Adani, his nephew Sagar Adani who is director at Adani Green, and six others with alleged bribery and fraud related to renewable energy projects in India that benefitted the tycoon’s company and India’s Azure Power, which was listed on the NYSE until late 2023.

In 2020, the unsealed indictment from Wednesday shows, executives of Adani Green and Azure “knowingly and wilfully conspired” and agreed to “corruptly” offer, authorise and pay bribes to government officials in India to “obtain or retain business advantages”.

Adani and his executives have also been accused of making false and misleading statements to investors and lenders in the United States regarding the company’s anti-bribery commitments and practices while raising money from them.

Between 2021 and 2024, Adani raised more than $3 billion in loans and bonds, including from investors in the United States.

“Gautam and Sagar Adani were engaged in the bribery scheme during a September 2021 note offering by Adani Green that raised $750 million, including approximately $175 million from U.S. investors. The Adani Green offering materials included statements about its anti-corruption and anti-bribery efforts that were materially false or misleading,” the U.S. Securities and Exchange Commission said.

The Adanis earlier this year made misleading statements to the public, the Indian stock exchange and investors despite being made aware of the U.S. investigation in 2023, the prosecutors alleged.

HOW WERE BRIBES TRACKED, PAID?

Sagar Adani, executive director of Adani Green and nephew of Gautam Adani, used his mobile phone to track details of the bribes offered to Indian officials, U.S. authorities alleged.

Executives from Azure also prepared an analysis using Excel and PowerPoint to summarise the different ways in which it could repay Adani Green for the bribes it had paid to benefit both companies.

One way discussed was to describe the payment internally at Azure as a “development fee”, but it instead used another option of getting Azure to transfer one of its projects to Adani in lieu of part of the payment, U.S. authorities alleged.

Azure in a statement said former officers of the company referenced in the U.S. indictment were no longer associated with the company, and the company continued to cooperate with U.S. authorities.

WHAT WERE THE POWER PROJECTS IN QUESTION?

U.S. authorities called the dealings in their indictment “The Corrupt Solar Project”.

Between 2019 and 2020, Adani Green and Azure were awarded renewable energy tenders by Solar Energy Corporation of India (SECI), a federal government-owned entity.

The project involved building solar plants in several Indian states.

U.S. authorities alleged Adani and others devised a scheme to bribe Indian state government officials to enter into agreements with SECI, “which would benefit” Adani subsidiaries and Azure.

HOW DID U.S. FEDERAL AGENTS INVESTIGATE, SEIZE EVIDENCE?

In March 2023, FBI special agents approached Sagar Adani with details of the grand jury’s ongoing investigation into the group and other entities. They took custody of electronic devices in Sagar’s possession and served him with a search warrant and grand jury subpoena.

The search warrant identified offences, individuals and entities under investigation by the U.S. for violations of the Foreign Corrupt Practices Act, securities fraud, and wire fraud.

WHAT’S NEXT FOR THE ADANI GROUP?

Adani Group in a statement said it would seek “all possible legal recourse”.

Indian lawyers said there was a possibility the matter could be settled between the Indian tycoon and U.S. authorities, and the billionaire can also seek a dismissal of the indictment.

Debopriyo Moulik, a criminal lawyer in New Delhi, said that since an arrest warrant had been issued by U.S. authorities, they would have to approach the Indian government through the Indian embassy to execute it.

The grand jury in its order said if any of the executives were found guilty of the charges they would have to forfeit any property or proceeds derived directly or indirectly as a result of the offences.

Investing.com — Baidu’s US-listed shares fell around 3% in premarket trading Thursday after the Chinese internet giant reported a 3% decline in third-quarter revenue, though the figure surpassed analyst expectations.

The company posted revenue of 33.56 billion yuan ($4.64 billion) for the quarter ending September 30, slightly ahead of the 33.43 billion yuan forecasted by analysts polled by LSEG.

Net income rose sharply, climbing 14% to 7.63 billion yuan, significantly exceeding the consensus estimate of 4.67 billion yuan.

Baidu (NASDAQ:BIDU) highlighted a 12% increase in its non-online marketing revenue, which reached $1.1 billion. This growth was primarily fueled by the expansion of its AI-driven cloud computing business.

Baidu is known for its dominance in China’s internet search engine market and its widely used mapping application. It also provides cloud computing services, with online marketing contributing a major share of its overall revenue.

In the AI space, Baidu has positioned its Ernie chatbot as a homegrown rival to OpenAI’s ChatGPT, which remains inaccessible in China. The company recently revealed that Ernie bot now boasts 430 million users.

“Baidu Core’s flattish third quarter top line reflected the ongoing weakness in our online marketing business, offset by the growth of our AI Cloud business,” said Robin Li, Co-founder and CEO of Baidu in the earnings press release.

“Despite the near-term pressures, we remain steadfast in our AI-focused strategy and are confident in our long-term trajectory. As we further scale AI, we are emboldened to find how it can drive innovations and create value for consumers, enterprises and society at large.”

This month, Baidu announced plans to launch its Xiaodu AI Glasses in the first half of next year. The smart glasses will feature at least one camera, leverage Ernie’s AI technology, and integrate Baidu’s search and mapping functions.

Although pricing details have not yet been disclosed, the product is anticipated to be a local alternative to Meta (NASDAQ:META)’s popular Ray-Ban smart glasses.

By Sakshi Dayal and Shilpa Jamkhandikar

NEW DELHI (Reuters) – Indian opposition parties demanded a probe on Thursday into allegations of wrongdoing by the Adani Group and said they would raise the issue in parliament after its chair Gautam Adani was charged in the U.S. over an alleged bribery scheme.

Billionaire Adani was indicted by U.S. prosecutors for his alleged role in a $265 million bribery and fraud scheme and arrest warrants were issued for him and his nephew, plunging his conglomerate deep into crisis for the second time in two years.

The Adani Group rejected the allegations as baseless and said it complied fully with all laws.

Adani has been the target of Indian opposition parties who say that he and his conglomerate have been protected by Prime Minister Narendra Modi’s government, charges both deny.

Modi’s opponents say he has longstanding ties with Adani, going back nearly two decades to when Modi was chief minister of the western state of Gujarat, to which Adani also belongs.

They accuse the government of favouring the group in business deals, charges the government has rejected as “wild allegations”.

“We are raising this issue, it is my responsibility to raise this issue as leader of opposition,” Rahul Gandhi, leader of the main opposition Congress party, told reporters when asked if he would bring it up in parliament next week.

Gandhi has led the opposition attack against Modi for what he says are Modi’s links to Adani since U.S. short-seller Hindenburg Research issued a report last year accusing the Adani group of using offshore tax havens improperly – which the company has denied.

Congress president Mallikarjun Kharge called for a comprehensive parliamentary probe into “every aspect of the working of the Adani Group”.

Sanjay Singh, a lawmaker from the opposition Aam Aadmi Party, said the indictment was a serious matter.

“All pending matters against Adani should be probed by an investigation agency and monitored by the Supreme Court,” Singh said.

There was no immediate response to the indictment from the Indian government.

However, Amit Malviya, a leader of Modi’s Bharatiya Janata Party and its IT cell head, said Congress should not get “needlessly excited”.

“The document you quote says, ‘The charges in the indictment are allegations and the defendants are presumed innocent unless and until proven guilty’,” he said in response to a post by Congress spokesman Jairam Ramesh seeking a parliamentary probe.

“The timing of the report, just before the parliament session and Donal(d) Trump’s impending presidency raises several questions,” he said, without elaborating.

Investing.com — Shares of French semiconductor materials company Soitec (EPA:SOIT) jumped over 16% on Thursday after the company delivered a reassuring set of first-half fiscal 2025 results and reiterated its full-year guidance. 

In the second quarter, Soitec reported sales that were in line with expectations but down 11% year-on-year at constant currency. 

Mobile sales, which make up a substantial portion of the company’s revenue, declined by 25% year-on-year in constant currency, missing consensus by 7%. 

However, the Edge & Cloud AI segment delivered standout performance, with sales surging 66% year-on-year and exceeding expectations by 20%. 

Analysts at UBS flagged that this growth was fueled by increased demand for FD-SOI wafers used in edge AI devices and Photonics-SOI wafers for AI data centers, reflecting broader trends in artificial intelligence adoption.

Despite pressure on gross margins, which fell to 30% and came in below consensus estimates of 32%, Soitec’s EBITDA margin of 33% slightly exceeded expectations. 

Free cash flow was also a bright spot, coming in at €35 million, aided by a working capital inflow.

The company’s reaffirmation of its fiscal 2025 guidance provided further reassurance to the market. 

Soitec expects full-year revenue to remain stable at constant currency compared to fiscal 2024, implying a significant rebound in the second half driven by the recovery of RF-SOI sales as inventory corrections ease. 

Soitec maintained its FY’25 EBITDA margin target at 35%, while revising its capital expenditure guidance slightly lower, from €250 million to €230 million.

UBS analysts noted that the company is on track for an 89% sequential revenue rebound in the second half, far surpassing typical seasonal growth of around 30%.

The company also announced the appointment of Frederic Lissalde, CEO of BorgWarner (NYSE:BWA), as chairman of the board, a move seen as strengthening governance.

Investing.com — JD Sports Fashion Plc (LON:JD) has revised its profit guidance for the full year, warning investors to expect earnings at the lower end of its previously forecast range of £955 million to £1,035 million, sending its shares tumbling by over 13%.

This downgrade follows softer trading in October, which saw like-for-like sales dip into negative territory for the group, with declines in key markets such as the UK, North America, and Asia-Pacific. European sales, however, showed a modest improvement.

The sportswear retailer mentioned that the trading environment became increasingly volatile during the quarter, with headwinds from elevated promotional activity, mild autumn weather, and a cautious consumer backdrop.

“We think that JD (NASDAQ:JD) Sports should maintain its position as a preferred partner of major sportswear brands like Nike (NYSE:NKE) and adidas, given its strong retailing skills, ability to appeal to more urban/cash customers and its opportunity to drive its apparel offer with its elevated stores,” said analysts at RBC Capital Markets in a note. 

 These factors particularly affected October’s performance, despite a robust start to the quarter driven by back-to-school sales. 

Overall, LFL sales for the group fell by 0.3% in Q3, with the UK down 2.4%, North America off by 1.5%, and APAC sliding 3.8%. Europe, in contrast, posted a 3.5% increase. Organic sales growth for the period came in at 5.4%.

Barclays (LON:BARC) analysts noted that JD’s softer guidance comes despite an improvement in foreign exchange impacts. The retailer now expects FX to be a £15 million headwind to profit in the second half, an improvement from the previously projected £20 million. 

Barclays forecasts JD’s profit before tax at £979 million, slightly below the Bloomberg consensus of £986 million, with the latter potentially facing a low single-digit downgrade following this update.

The company has said the weaker performance to subdued consumer demand and competitive pricing pressures. 

JD managed to improve its gross margin by 0.3 percentage points during the period by maintaining “commercial discipline,” but this was not enough to offset the broader challenges.

“We also think improvements are coming through in governance, which should reassure investors, however execution risk is probably higher than average given the company’s pace of expansion,” RBC added.

The results also reflect the broader struggles facing the retail sector, particularly in the US, where unseasonably warm autumn weather has dampened sales for many. 

Analysts at Barclays observed that trading conditions may improve as colder weather sets in, offering some hope for a stronger finish to the year during the peak holiday season.

The latest warning adds to concerns about the company’s ability to generate stronger free cash flow (FCF) in the coming years. 

Barclays pointed out a stark contrast between JD’s FY25 price-to-earnings ratio of 8.6x and its price-to-cash flow ratio of approximately 17x, reflecting a free cash flow yield of just 6%. 

Heavy capital expenditure, including new store openings and acquisitions, continues to weigh on cash generation, with capex expected to run at nearly three times depreciation in FY25.

JD Sports has expressed confidence in its positioning for the crucial holiday trading period but acknowledged that the overall environment remains highly unpredictable. 

The cautious tone reflects broader industry challenges and underscores the importance of upcoming trading to meet even the revised profit targets.

Barclays analysts remain wary, maintaining an “underweight” rating on the stock and noting that the low-end profit threshold for JD’s long-term incentive plan (LTIP) of 2.5% growth is reflective of cautious capital allocation priorities.

“Given the company’s lowered guidance, we would expect similar changes to adj. consensus estimates, with £955m implying a ~3% cut to Jan-25 PBT consensus,” said analysts at Morgan Stanley (NYSE:MS) in a note.

By Sethuraman N R, Bharath Rajeswaran and Indranil Sarkar

(Reuters) -Firms of India’s Adani Group conglomerate lost as much as $34 billion in market value on Thursday after U.S. prosecutors charged its billionaire chairman in an alleged bribery and fraud scheme.

Gautam Adani’s flagship Adani Enterprises (NS:ADEL) tumbled as much as 23% to its lowest since Nov. 2023 for its worst one-day drop since February last year.

Other group firms – Adani Ports, Adani Total (EPA:TTEF) Gas, Adani Green, Adani Power (NS:ADAN), Adani Wilmar (NS:ADAW) and Adani Energy Solutions, ACC (NS:ACC), Ambuja Cements (NS:ABUJ) and NDTV – also fell between 6% and 19%.

The sharp selloff took down the total market capitalisation of the 10 Adani-backed companies to about $147 billion by 0854 GMT, from $169.08 billion on Tuesday.

“Normally investors do not like any lapse of corporate governance and till the time there is clarification, investors will shy away from Adani group stocks,” said Saurabh Jain, a retail equities analyst at SMC Global Securities.

In a statement, Adani Group dismissed the accusations as “baseless and denied”, and vowed to seek “all possible legal recourse”.

They come within two years of U.S. short-seller Hindenburg Research’s accusations of improper use of tax havens and involvement in stock manipulation by Adani group, which the conglomerate has also denied.

This week U.S. authorities said Adani and seven other defendants, including his nephew Sagar Adani, agreed to pay about $265 million in bribes to Indian government officials for contracts expected to yield profit of $2 billion over 20 years, and develop India’s largest solar power project.

The prosecutors added that the Adanis, along with former chief executive Vneet Jaain of Adani Green Energy (NS:ADNA), raised more than $3 billion in loans and bonds by hiding their corruption from lenders and investors.

Adani Green Energy, however, cancelled plans to raise $600 million in U.S. dollar-denominated bonds. The issue had been priced but was pulled after the news.

“The group faces growing challenges in accessing global capital markets amid heightened scrutiny,” said Narinder Wadhwa, managing director of SKI Capital.

“Such withdrawals indicate a defensive posture as the group focuses on mitigating damage.”

In early Asian trade, Adani dollar bonds slumped, with prices down 3 cents to 5 cents on bonds for Adani Ports and Special Economic Zone [US00652MAJ18=TE]. They were the largest falls since the short-seller attack of February 2023.

Group firms also dragged down Indian benchmarks on the day, with the NSE Nifty 50 falling 0.75% and the BSE Sensex losing 0.6%. (BO)

($1=84.4000 rupees)

FRANKFURT (Reuters) – Commerzbank (ETR:CBKG) on Thursday named Carsten Schmitt as its new chief financial officer, a crucial role at Germany’s No. 2 lender as it seeks to fend off an approach by Italy’s UniCredit for a tie-up.

The job became vacant after the previous CFO, Bettina Orlopp, assumed the role of chief executive officer, a promotion that came as the bank’s board deemed her better placed to negotiate with UniCredit.

Schmitt previously served as Executive Vice President of Group Strategy and M&A at Danske Bank (CSE:DANSKE). Before that, he worked for Commerzbank in various positions for more than 20 years, most recently heading the group finance segment from 2019 to 2021.

The handover is planned to be completed by spring 2025 at the latest, said Commerzbank.

The new CFO will play an important part in reshaping the bank’s tweaked strategy, which it plans to present in February.

Italy’s No. 2 bank has been pressing for a tie-up after snapping up a hefty stake in Commerzbank in September, while the German company has been honing its defence as it seeks to remain independent.

UniCredit’s move is the most ambitious attempt yet at a pan-European bank merger, but it faces considerable hurdles.

Commerzbank’s management, employees and German Chancellor Olaf Scholz have all voiced opposition to a potential takeover, but at least one big investor and some business leaders favour talks.

UniCredit CEO Andrea Orcel, who has long held an interest in a tie-up with Commerzbank, has said a combination would be the best outcome although he has not ruled out walking away.