CNBC: “Canon launches ASML challenge with machine to make most advanced chips”

Canon said its latest machine, called the FPA-1200NZ2C, will be able to make semiconductors equivalent to a 5nm process and go as small as 2nm. For context, the A17 Pro chip inside Apple’s iPhone 15 Pro and Pro Max, is a 3nm semiconductor.

Both TSMC and South Korea’s Samsung, the two biggest advanced chip manufacturing companies, are aiming to make 2nm chips in 2025.

Lithography machines are key to effectively print the design of a chip onto the material that ends up going into the semiconductor.

ASML’s machines use ultraviolet light during that process. Canon said its machine does not require a light source with a special wavelength, therefore reducing power consumption.

Canon’s traditional strength in cameras, optical equipment and printers, has seen it renew its focus on the semiconductor supply chain at a time when the world is increasingly in need of chips to power technologies like artificial intelligence.

Arjun Kharpal

Interesting business decision by Canon to enter the semiconductor manufacturing market at a time when chips are both highly sought after and highly contentions because of the US sanctions against China. Further reporting states that their machines should be considerably cheaper, up to ten times, than ASML’s EUV lithography systems, which would make them attractive to smaller fabs or startups that can’t afford to spend around $200 million for one piece of equipment.

Goldman Sachs Research: “The Risks of a Higher Rate Regime”

The Risk from Unprofitable Firms

In the corporate sector, investors might hesitate to continue financing unprofitable companies that they hope will pay off well down the road now that the opportunity cost has risen. The number of unprofitable firms has risen in recent decades, reaching almost 50% of all publicly-listed companies in 2022 (Exhibit 7, left)^[3]. The share of business activity that they account for is much smaller but still an economically meaningful 10% of total business revenues (Exhibit 7, right).

Unprofitable firms account for closer to 13% of capital spending and employment, and even just the smaller group of persistently unprofitable firms account for about 5% of employment (Exhibit 8).

Higher funding costs could force some of these companies to cut labor costs or even close. In previous research we found that unprofitable firms tend to cut capital spending more aggressively when faced with margin pressure, and we find they also cut labor costs more aggressively when hit with interest rate shocks (Exhibit 9, left). The larger risk is that some firms might simply have to close if their path to profitability is too distant. The exit rate of unprofitable firms is currently low by historical standards and has actually declined since the start of the pandemic, leaving it ample room to rise from here (Exhibit 9, right).

David Mericle & Ronnie Walker

Fascinating figures about the US economy: almost half of all listed companies are now unprofitable! Presumably an outcome of the near-zero interest rate regime that has dominated over the past decade, these companies can be expected to face increasing pressures to become profitable through comprehensive restructuring, or… go bankrupt or close down, contributing to higher unemployment and decreases in economic activity.

Matt Kloskowski: “What’s the Future of Lightroom (Podcast Episode 7)”

In Episode 7, Brian Matiash has joined me once again. This week, we give our thoughts on what the future of Lightroom may be. We talk about Lightroom Classic as well as Lightroom (the cloud based version, which isn’t all cloud based anymore).

Matt Kloskowski

Interesting topic, but I fear that both participants to this podcast are too quick to dismiss the needs of other photographers and the substantial number of sub-par or straight-up missing features in modern Lightroom. The strongest example would be tethering: as landscape and wildlife photographer, I’m sure Matt has no need for it in the field, but for studio work tethering is an essential tool to check images and present them to models in real time. No serious studio photographer would consider switching to new Lightroom from Classic without it.

PetaPixel: “EU Common Charger Law may be Final Nail in Coffin for DSLRs”

Although many mirrorless cameras include USB Power Delivery (USB PD) capabilities, enabling them to be charged over USB, often USB-C, this is not true of many DSLR camera bodies. Even relatively new, flagship DSLR cameras, like the Nikon D6 released in 2020, cannot be charged over USB. Sure, the D6 moved from microUSB to USB-C, an excellent switch for accessories and file transferring, but the camera’s batteries must be charged in a dedicated external charger.

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Hogan instead wonders if camera companies may ultimately use the EU’s charger directive as a reason to finally ditch DSLR camera technology in their entirety, except Pentax, of course, who not only has cameras that can charge over USB-C but remains a stalwart supporter of DSLR camera technology.

Another alternative outcome is that companies drop all but compliant camera models in the European Union and continue business as usual elsewhere. Hogan notes that the Nikon D780, for example, can charge internally via USB-C, so DSLR cameras may survive in the European Union in a limited fashion.

With Europe accounting for 20-25% of shipments recently, the EU requirements may just be enough to trigger the camera companies towards retiring the mirror slappers, as the volume of DSLR shipments is now running at about a tenth that of mirrorless, Hogan writes.

Jeremy Gray

Interesting hypothesis! I didn’t stop to think that photo and video cameras would fall under the same interoperable charging regulation that compelled Apple into switching to USB-C for its iPhones. From a business standpoint it makes a lot of sense to retire DSLR cameras around this deadline: for most manufacturers the migration to mirrorless, already compliant with this regulation, is well underway – Canon for example hinted back in 2020 that it stopped developing new EF lenses, an obvious indication that its legacy DSLR system is on life support. And I doubt any of these companies want or can afford retrofitting existing DSLR cameras with USB-C charging or maintaining manufacturing capacity for a system already in decline. Even Apple chose to upgrade the entire iPhone lineup to USB-C instead of releasing a dedicated model for the EU market.