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Apple slashes iPhone Air production amid tepid demand

Mohammed Fahad
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Apple slashes iPhone Air production amid tepid demand
  • Production orders, starting in November, will be less than 10 per cent of the volume compared with September.

Apple is scaling back production of its recently launched iPhone Air, after disappointing sales revealed a consumer preference for devices with robust cameras and longer battery life over ultra-thin design.

The move, reported by Nikkei Asia on Wednesday, marks a rare retreat for the tech giant, which had positioned the iPhone Air as its boldest smartphone design in years.

According to sources cited by Nikkei, Apple will reduce iPhone Air production orders to nearly “end of production” levels, with volumes beginning in November expected to fall below 10 per cent of what was produced at launch in September.

“Production orders, starting in November, will be less than 10 per cent of the volume compared with September,” one supplier told the publication. The decision comes just weeks after the iPhone Air’s launch in China and amid weak demand in major markets outside China.

No demand for iPhone Air

Launched at a starting price of $999, the iPhone Air stands out as the thinnest iPhone ever at just 5.6 mm thick—slimmer than a pencil—and weighs less than any iPhone since the 2020 iPhone 12 mini. It carries a 48−mega pixel rear camera, matching the main camera found in Apple’s other flagship models, the iPhone 17 and iPhone 17 Pro.

However, despite Apple’s claim of “all−day” battery life, the iPhone Air’s battery performance lags behind those higher−end models, prompting Apple to design a $99 MagSafe battery accessory to extend usage up to 40 hours.

Market signals have been clear: the iPhone Air has remained immediately available for shipment on Apple’s website in all configurations, while both the iPhone 17 and iPhone 17 Pro have seen shipping delays of two to three weeks due to strong demand.

A recent survey by KeyBanc Capital Markets found “virtually no demand for iPhone Air, and limited willingness to pay for a foldable.” The research further noted that AI features, despite prominent mentions in Apple’s marketing, have yet to influence buying decisions.

Apple’s struggles with the iPhone Air parallel challenges faced by competitors. Samsung reportedly halted production of its Galaxy S25 Edge and canceled future models in the line after the device sold only 1.31 million units as of August—significantly fewer than its more conventional siblings, which garnered sales of up to 12.18 million units in the same period.

Meta cuts 600 jobs in AI restructuring, pursues $27b data centre project

Ana Mary Joseph
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Meta cuts 600 jobs in AI restructuring, pursues $27b data centre project
  • Job reductions affect several teams, including Facebook Artificial Intelligence Research, as well as product-oriented AI and AI infrastructure groups.
  • Company expects leaner team would streamline decision-making and increase both the scope and impact of individual roles.

Meta Platforms announced that it will cut roughly 600 positions from its Superintelligence Labs division, as the company seeks to make its artificial intelligence (AI) operations more nimble and responsive amid intensifying competition in the tech sector.

The job reductions affect several teams, including Facebook Artificial Intelligence Research (FAIR), as well as product-oriented AI and AI infrastructure groups.

However, the recently established TBD Lab—comprising a select team of researchers and engineers developing Meta’s next-generation foundation models—will remain unaffected, the company confirmed. The restructuring was first reported by Axios, citing an internal company memo.

Chief AI Officer Alexandr Wang explained that a leaner team would streamline decision-making and increase both the scope and impact of individual roles.

“Fewer team members will streamline decision-making and increase the responsibility, scope and impact of each role,” said Wang, according to the memo. Meta added that affected employees are being encouraged to apply for other roles within the organisation.

The move follows a broader realignment of Meta’s AI efforts, which were consolidated under the Superintelligence Labs umbrella in June after leadership changes and lackluster feedback for its open-source Llama 4 model. CEO Mark Zuckerberg has personally championed a significant recruitment drive to invigorate Meta’s AI capabilities.

Data centre expansion

In tandem with its AI restructuring, Meta on Tuesday announced a landmark $27 billion financing deal with Blue Owl Capital, marking the company’s largest-ever private capital arrangement.

The funds will support Meta’s biggest data center project to date—a cornerstone for its expanding AI infrastructure. Industry analysts note the deal will allow Meta to pursue its substantial AI objectives by shifting much of the cost and investment risk to external investors, while Meta retains a minority stake in the project.

Superintelligence Labs comprises Meta’s foundational and product teams, FAIR, and the new TBD Lab which aims to develop the company’s next wave of AI systems. Meta’s commitment to AI dates back to 2013, when it launched the FAIR unit under AI pioneer Yann LeCun, laying the groundwork for a global research network with deep learning at its core.

Meta’s latest moves underscore its determination to maintain a leading edge in AI while balancing innovation with operational discipline.

IBM cloud growth slows, but AI-powered mainframe drives Q3 results

Naushad K. Cherrayil
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IBM cloud growth slows, but AI-powered mainframe drives Q3 results
  • IBM’s cloud business, led by its Red Hat hybrid cloud unit, saw sales growth slow to 14% in the third quarter, down from 16% in the previous period.

IBM reported mixed third-quarter results, with slowing cloud software growth raising caution among investors—even as surging demand for the company’s new AI-optimised mainframe systems helped push sales and profits above Wall Street estimates.

Shares of the technology giant fell 5 per cent in after-hours trading, reflecting investor concern over decelerating momentum in IBM’s cloud business, which is a linchpin of its long-term growth strategy as enterprise customers adopt more AI-driven solutions.

Cloud momentum cools

IBM’s cloud business, led by its Red Hat hybrid cloud unit, saw sales growth slow to 14 per cent in the third quarter, down from 16 per cent in the previous period.

While this segment was expected to be a primary beneficiary of rising AI adoption and the broader shift to cloud services, the moderation in growth overshadowed the company’s better-than-expected revenue of $16.33 billion, which surpassed analysts’ consensus forecast of $16.09 billion.

Chief Executive Arvind Krishna sought to reassure investors, stating during the company’s post-earnings call that Red Hat’s growth is expected to return to “mid-teen percentage levels”—or close to it—by 2026.

Despite a roughly 30 per cent rally in IBM shares so far this year, the stock’s premium valuation has made expectations particularly sensitive. The company trades at a forward price-to-earnings multiple of nearly 24, notably higher than the roughly 18 times forward earnings for key rival Accenture.

AI mainframe business surges

Offsetting these cloud concerns, IBM’s infrastructure segment—which includes its new mainframe systems—posted revenue growth of 17 per cent to $3.56 billion. The mainframe, built with chips tailored for AI applications, has seen particularly strong adoption in the financial services sector, which values the platform’s ability to maintain strict data residency and encryption standards while enabling AI development, according to Chief Financial Officer Jim Kavanaugh.

IBM’s AI-related business activities grew to $9.5 billion, up by $2 billion in just one quarter—further underscoring robust customer interest in generative AI and legacy modernisation.

Looking ahead, IBM raised its full-year outlook, forecasting revenue growth to exceed 5 per cent at constant currency. This is a slight increase from the company’s earlier projection of at least 5 per cent growth, reflecting confidence in strong AI-driven demand even as software growth faces headwinds.

Amazon unveils new tech to rev up delivery and streamline logistics

Mohammed Fahad
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Amazon unveils new tech to rev up delivery and streamline logistics
  • Features a small integrated screen, Amelia directs drivers with turn-by-turn navigation, scans package codes, and captures photo proof of delivery.
  • Now leveraging advanced robotics, artificial intelligence, and innovative eyewear to shave precious seconds off every package’s journey

In its ongoing quest to redefine fast delivery, Amazon is once again raising the bar for logistics efficiency. The Seattle-based giant, long known for transforming consumer expectations from two-day shipping to same-day and even one-hour delivery, is now leveraging advanced robotics, artificial intelligence, and innovative eyewear to shave precious seconds off every package’s journey.

At Amazon’s annual “Delivering the Future” event, company executives showcased a suite of technologies focused on the notoriously expensive and complex “last 100 yards”—the final steps between a delivery vehicle and the customer’s front door.

One standout: advanced smart glasses, internally codenamed Amelia, developed specifically for delivery drivers. Featuring a small integrated screen, Amelia directs drivers with turn-by-turn navigation, scans package codes, and captures photo proof of delivery.

Unlike the bulky handheld GPS devices typically used today, Amelia’s hands-free operation streamlines workflow and safety. The device pairs with a controller worn in a vest, and its practical design includes swappable battery packs to address longevity on long shifts.

Delivering promising results

According to Beryl Tomay, Amazon’s vice president of transportation, hundreds of drivers have tested Amelia, delivering promising results.

“It reduces the need to manage a phone and a package,” Tomay said, emphasising that the glasses help drivers remain focused and safe on the job. She noted that the new technology has already led to time savings of up to thirty minutes per shift in some cases.

For now, the glasses are experimental and optional; Amazon plans to distribute them at no cost to interested drivers and contractors, but widespread adoption—ahead of formal rollout—remains in flux.

This push for efficiency builds on previous innovations.

Last year, Amazon introduced a delivery van scanner that shines a green spotlight on the correct parcel for each stop, saving time usually spent reading labels. The company has also recently unveiled detailed digital maps that offer richer information about neighborhoods and building layouts, surpassing standard navigation tools to further trim delivery times.

Amazon’s automation efforts

Inside its warehouses, Amazon is expanding its automation efforts. The company demonstrated a new robotic arm, dubbed Blue Jay, designed to collaborate with human workers by picking items and sorting them for faster order fulfillment.

The robotic system is already in use at a South Carolina warehouse and will soon be rolled out to more sites—particularly those focused on ultra-rapid, sub-same-day deliveries. Amazon claims Blue Jay reduces workplace injuries and occupies less floor space than previous-generation robots.

Additionally, a new artificial intelligence system is being deployed at select warehouses, starting in Tennessee. This software will monitor real-time operations to prevent gridlock and streamline daily planning. “We now have a tool to analyze all the site data as it happens,” said Tye Brady, chief technologist of Amazon Robotics. The goal: coordinated, proactive warehouse management across Amazon’s entire network.

However, innovation brings transformation. According to the New York Times, Amazon anticipates that automation will reduce its US hiring needs by 160,000 workers over the next two years, even as it continues to hire short-term staff for the holiday season.

The company’s technological leadership comes at a time when Amazon shares have dipped, closing down 1.8% at $217.95 on Wednesday—the only one of the so-called Magnificent Seven tech stocks to show a year-to-date decline.

SAP misses revenue estimates as cloud growth slows

Ana Mary Joseph
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SAP misses revenue estimates as cloud growth slows
  • Expects cloud revenue to reach the lower end of its previously forecasted range (€21.6 to €21.9 billion) for 2025, citing persistent uncertainty.

German enterprise software leader SAP faced investor scrutiny this week after reporting third-quarter results that fell short of revenue expectations, highlighting both its ongoing cloud transition and the current economic uncertainties.

On Wednesday, SAP announced Q3 revenue of €9.08 billion ($10.59 billion), up 7 per cent from the prior year but just below analyst forecasts of €9.17 billion. The shortfall sparked a 3 per cent dip in SAP’s US-listed shares during after-hours trading, reflecting concerns in the market.

A key driver of SAP’s strategic evolution, its cloud business, posted 22 per cent growth year-on-year—a robust figure, but the segment’s slowest pace since late 2023.

The company, headquartered in Walldorf, Germany, has steadily shifted from up-front software licensing to a subscription-driven, cloud-based model, betting on more predictable, recurring income.

However, Wednesday’s results signal that cloud expansion may be facing headwinds in an uncertain macroeconomic environment.

Profitability remains strong

Despite the revenue miss, SAP delivered on profitability. Operating profit (on a non-IFRS basis) climbed 14 per cent to €2.57 billion, slightly ahead of analyst expectations. Free cash flow, a critical indicator for dividends, also grew by 5 per cent to €1.27 billion.

“We’ve maintained forward momentum despite an uncertain macroeconomic backdrop,” said CFO Dominik Asam, underlining management’s confidence in the company’s strategic direction.

Revised guidance signals caution

SAP provided a measured outlook for the remainder of the year and into 2025. It now expects cloud revenue to reach the lower end of its previously forecasted range (€21.6 to €21.9 billion), citing persistent uncertainty.

In contrast, operating profit is anticipated to come in at the upper end of expectations (€10.3 to €10.6 billion), and free cash flow guidance has been raised to €8– €8.2 billion from the earlier €8 billion estimate.

The guidance reflects SAP’s ability to manage costs and generate cash, even as cloud growth decelerates. Investors responded with caution, sending SAP shares down after the earnings release. The moderated cloud outlook raised questions about whether SAP, and its peers, is entering a more mature phase of cloud adoption.

As the company navigates this transition, investors and analysts will be watching closely to see if SAP can reinvigorate its cloud momentum or deliver additional operational efficiencies to sustain shareholder returns.

A third of big tech Indian employees come from tier 3 colleges

Ana Mary Joseph
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A third of big tech Indian employees come from tier 3 colleges
  • Established finance and tech companies like Goldman Sachs, Visa, Atlassian, Oracle, and Google maintain a preference for campus placements and brand-name institutions, with only 18% of surveyed employees coming from tier 3 colleges.

A significant portion of employees at major tech companies like Zoho, Apple, and NVIDIA in India are graduates from tier 3 colleges, according to a new report by Blind, an anonymous social platform for professionals.

Based on a survey of 1,602 Indian tech workers, the report reveals evolving hiring patterns in India’s competitive IT sector.

Shifting priorities in hiring

The Blind survey categorised educational institutions using the NIRF 2025 rankings, separating graduates into tier 1, tier 2, tier 3, and overseas backgrounds.

Notably, around 34 per cent of respondents working at prominent tech firms—including SAP and PayPal—were tier 3 college alumni. This represents a marked shift away from elite college-based recruitment and toward skills-driven hiring, especially in the fast-evolving tech space.

“Unlike many traditional finance organisations, where a prestigious college name still opens doors, leading tech companies in India are focusing more on skillsets and less on alma mater pedigree,” the report notes.

In contrast, established finance and tech companies like Goldman Sachs, Visa, Atlassian, Oracle, and Google maintain a preference for campus placements and brand-name institutions, with only 18 per cent of surveyed employees coming from tier 3 colleges.

When surveyed about the impact of their education, 59 per cent of respondents who were tier 3 graduates and 45 per cent of overseas graduates said their college was just a line on their resume.

In comparison, alumni from tier 1 and tier 2 schools largely credited campus recruitment for their career starts, highlighting that college networks still play a decisive role for many.

Does college prestige pay off?

The survey found only 15 per cent of tier 3 college graduates believed their education brought significant salary advantages, while nearly three-quarters said it was useful only at the start of their careers or not at all. For overseas graduates, just over half reported minimal or no impact on their earnings from college.

Overall, the responses break down as follows: 41 per cent of professionals surveyed graduated from elite tier 1 colleges (IITs, IISc, leading IIMs, BITS Pilani), 30 per cent from tier 2, 25 per cent from tier 3, and 4 per cent from foreign institutions.

This trend illustrates India’s gradual—but clear—pivot towards meritocracy in hiring, especially in the country’s dynamic technology sector.

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