Tech, Media & Telecom Roundup: Market Talk

Dow Jones
Jun 12

The latest Market Talks covering Technology, Media and Telecom. Published exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.

0953 ET - Victoria's Secret says the recent hack that temporarily shut down its web site and caused it to delay reporting its earnings dented sales by about $20 million. The incident was detected on May 24. The company proactively shut down its web site and other systems. The website was restored on May 29. The investigation into the security breach is ongoing, it says. (suzanne.kapner@wsj.com)

0910 ET - Greater investment in the U.K. economy will boost growth in the medium term, writes Martin Frandsen at Principal Asset Management. U.K. Treasury Chief Rachel Reeves on Wednesday detailed the government's spending plans for the coming years, including greater investment in housing, digital infrastructure and defense. The magnitude and timing remain uncertain, Frandsen says. But the plans "follow a similar pattern seen in Europe of renewed willingness to invest into reigniting the economies [and] should be a positive tailwind for growth over the coming years," he tells investors in a note. (joshua.kirby@wsj.com; @joshualeokirby)

0853 ET - With BLS staffing levels and CPI data collection under scrutiny, the BLS says it will change its methodology for collecting data on wireless phone service prices. The agency says that starting in the July inflation data, "BLS will replace the survey data collected for the CPI's wireless telephone services index with secondary source data and non-traditional index methods," the agency writes in a release accompanying the May inflation data. The BLS didn't add information about the reason for the change, but says it will publish a paper on the new methodology in July. (matt.grossman@wsj.com; @mattgrossman)

0013 ET - Investors are likely to focus on food delivery competition and AI adoption for Chinese internet sector in the near term, according to Citi analysts in a research note. The Chinese internet sector delivered a 18.3% year-to-date return, outperforming that of Southeast Asia, Japan, and U.S., the analysts point out. While investors have retained relatively positive sentiment towards China's internet sector due to reasonable valuation and quality companies, the spike of intensity in food delivery competition and the escalated merchant support initiatives could drag on profit and margin growth in 2025, the analysts say. China's AI model progression and "agentic" AI innovation continue to evolve despite cooling from initial excitements, the analysts say. Investment risks include tariffs, a worsening profit outlook amid competition and geopolitical tensions. (tracy.qu@wsj.com)

2339 ET - Tencent Music Entertainment's plan to acquire Chinese podcast startup Ximalaya could help TME access an under-penetrated user demographic, Barclays analysts say in a research note. As online audiobook user base is skewed towards the older and wealthier population and TME's core online music user base is mostly young users, the deal could give it access to this under-penetrated market, they say. For Ximalaya, it has tried several times to list publicly, either in Hong Kong or the U.S., but this never came to fruition. However, the deal, worth around $2.7 billion, represents a "fair price" and not an "amazing price" for TME, they say. TME's ADR prices last closed at US$18.34. (sherry.qin@wsj.com)

2308 ET - Tencent Music Entertainment's plan to acquire Chinese podcast startup Ximalaya bodes well for both parties, Citi analysts say in a research note. The acquisition is expected to strengthen TME's long-term audio and podcast positioning, enrich its content offering and enhance monetization, they say. The cash-and-stock deal is estimated to be worth between US$2.7 billion and US$2.8 billion based on Citi's calculation. For Ximalaya, integration with the broader TME and Tencent ecosystem could expand its reach to a wider user base and generate synergies with other Tencent entertainment IPs, the analysts say. Citi maintains a buy call on TME but leaves the ADR target price unchanged at US$17.00. Shares last ended at US$18.34. (sherry.qin@wsj.com)

2257 ET - Kakao's ongoing artificial-intelligence push to turn messaging app KakaoTalk into a more service-centric and next-generation platform needs further progress in execution, Nomura analysts Angela Hong and Won Kang write in a note. The South Korean internet company is developing open-source-based large language models tailored for its core services, with early testing focus on search-feature enhancements and agent-based interactions, the analysts say. "However, the rollout remains in early stages, and the timeline for user adoption is uncertain," they say. Nomura raises the stock's target price by 23% to KRW48,000 but keeps a neutral rating. Shares are 2.0% higher at KRW51,000. (kwanwoo.jun@wsj.com)

1319 ET - Warner Bros. Discovery's plans to split into two companies make its Streaming & Studios business better positioned to participate in a changing media landscape, UBS analysts say in a note. The transaction could lead to additional consolidation in the industry, setting up opportunities for joint efforts to confront secular headwinds in traditional TV and drive greater scale and content rationalization in direct-to-consumer, the analysts say. The new Streaming & Studios company  will generate about $2.9B in EBITDA in 2025, growing to $3.3B in 2026, they estimate.(kelly.cloonan@wsj.com)

(END) Dow Jones Newswires

June 11, 2025 12:20 ET (16:20 GMT)

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