Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 1 of 14 PageID #: 3519
`Case 5:19-cv-00036—RWS Document 66-43 Filed 08/27/19 Page 1 of 14 PageID #: 3519
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`EXHIBIT 42
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`Case 5:19-cv-00036—RWS Document 66-43 Filed 08/27/19 Page 1 of 14 PageID #: 3519
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`EXHIBIT 42
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 2 of 14 PageID #: 3520
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
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`BUSINESS NEWS
`JANUARY 24, 2019 / 4:09 AM / 7 MONTHS AGO
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`Chip results augur more tech gloom as slowing China weighs
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`Cate Cadell, Ju-min Park
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`BEIJING/SEOUL/PARIS (Reuters) - Somber results from chipmakers SK Hynix Inc
`(000660.KS) and Texas Instruments Inc (TXN.O), on the heels of warnings from tech
`behemoths Samsung and Apple, indicate more gloom for the sector as China’s economy slows
`to its weakest in decades.
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`https://www.reuters.com/article/us-china-chips-outlook/chip-results-augur-more-tech-gloom-as-slowing-china-weighs-idUSKCN1PI0YC
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`1/13
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 3 of 14 PageID #: 3521
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
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`FILE PHOTO: The logo of SK Hynix is seen at its headquarters in Seongnam, South Korea, April 25, 2016. REUTERS/Kim
`Hong-Ji/File Photo
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`A raft of earnings, analyst notes and market commentary in recent weeks have confirmed that
`a slowdown in the world’s No.2 economy, exacerbated by its crippling trade war with the
`United States, will continue to squeeze sales and profits at technology companies, at least in
`the first half of the year.
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`Chinese woes led to South Korea’s SK Hynix turning in its first quarterly profit decline in two
`years. The world’s No.2 memory chipmaker, which depends on China for more than a third of
`its revenue, also said it plans to spend 40 percent less on buying chip equipment this year.
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`Texas Instruments (TI), supplier of touchscreen controllers, power-management chips and a
`control device for Apple’s (AAPL.O) iPhones and iPads, reported a better-than-expected
`quarterly profit, but its revenue missed estimates.
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`The Dallas-based company said demand in China was weaker than other regions, especially for
`smartphones, including demand from Chinese smartphone makers.
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`“We are seeing signs from our customers and the channel that this weakness is primarily from
`increased caution due to trade tensions,” Dave Pahl, head of TI’s investor relations, said.
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`“We assume that this weakness is a combination of lower local end-demand as well as reduced
`exports, but we do not have the visibility to distinguish between the two.”
`
`STMicroelectronics (STM.PA), Europe’s second-biggest chipmaker after Germany’s Infineon
`Technologies (IFXGn.DE), said it expected first-quarter sales to drop by more than a fifth
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`https://www.reuters.com/article/us-china-chips-outlook/chip-results-augur-more-tech-gloom-as-slowing-china-weighs-idUSKCN1PI0YC
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`2/13
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 4 of 14 PageID #: 3522
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
`from the last quarter of 2018.
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`The Geneva-based company, which supplies sensors to Apple and the automotive industry, is
`suffering from weaker demand for its mass-market microcontrollers as Asian clients use
`current inventories rather than placing new orders.
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`Market data indicates shipments in China, the world’s largest smartphone market, fell about
`12 percent last year as consumers held on to their older devices.
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`Economic growth in the country, which has generated nearly a third of global growth in recent
`years, slowed to its weakest in nearly three decades in 2018 and is expected to ease further this
`year.
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`Smartphone shipments will further dip 3 percent in 2019 to below 400 million for the first
`time in five years, market research firm Canalys estimates.
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`BAD NEWS
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`Apple was the first to flag anemic Chinese demand for iPhones with a rare cut to its sales
`outlook earlier this month.
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`The company, which lost its crown as the world’s top-listed firm after the news, is likely to
`have cut planned production for the March quarter as well, Nikkei reports.
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`Samsung Electronics (005930.KS), chip supplier to Apple and Chinese tech giant Huawei
`[HWT.UL], followed with more bad news - an estimated 29 percent drop in fourth-quarter
`profit and subdued earnings for the current quarter.
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`“Demand in the tech industry is going to be weaker than thought in the first half,” Seoul-based
`Yuanta Securities analyst Lee Jae-yun said.
`
`“Until the first half of 2018, companies were very aggressive about their investment, then that
`quickly turned conservative from the second half of last year and will continue throughout the
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`https://www.reuters.com/article/us-china-chips-outlook/chip-results-augur-more-tech-gloom-as-slowing-china-weighs-idUSKCN1PI0YC
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`3/13
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 5 of 14 PageID #: 3523
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
`first half of 2019.”
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`The Philadelphia Semiconductor Index .SOX has lost nearly a fifth of its gains since hitting a
`record high in March 2018, as chip prices fell due to bleak smartphone sales and a push back in
`spending by data center customers to cut inventories.
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`FILE PHOTO: A Texas Instruments Office is shown in San Diego, California, U.S., April 24, 2018. REUTERS/Mike Blake/…
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`SILVER LINING
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`Taiwan Semiconductor Manufacturing Co Ltd (TSMC) (2330.TW), which last week forecast
`its sharpest quarterly revenue fall in a decade, said a sudden drop in sales of high-end
`smartphones has led to an inventory build-up.
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`https://www.reuters.com/article/us-china-chips-outlook/chip-results-augur-more-tech-gloom-as-slowing-china-weighs-idUSKCN1PI0YC
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`4/13
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 6 of 14 PageID #: 3524
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
`Still, the pushout in chip orders is generating optimism that sales will pick up towards the later
`half of the year.
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`Dutch chip-tooling company ASML Holding NV (ASML.AS), which serves Samsung, TSMC
`and Intel (INTC.O), told Reuters that Chinese demand for chip manufacturing equipment has
`not waned.
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`ASML forecast lower sales for the first quarter, but said it would pick up later.
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`Things are also expected to get better for Samsung and Hynix, which have been plagued by
`weak demand from data centers.
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`STMicro shares jumped nearly 9 percent, making them the top performer on France’s CAC 40
`index after its boss delivered an upbeat forecast for the second half of the year.
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`Huawei, the world’s No. 2 smartphone maker after Samsung, struck an optimistic note on
`Thursday, saying 2018 sales at its consumer business exceeded a record $52 billion on strong
`demand for its premium smartphones.
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`The company, which is facing mounting global scrutiny of its activities, also announced its first
`5G base station chipset and said it aimed to unveil its first foldable 5G smartphone next
`month.
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`ASML’s American rival Lam Research (LRCX.O), posted better-than-expected quarterly
`results.
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`Programmable chipmaker Xilinx’s (XLNX.O) results and outlook beat analysts’ expectations,
`helped by rollouts and preparation for so-called 5G cell phone networks in South Korea and, to
`a lesser extent, China and North America.
`
`Reporting by Cate Cadell in Beijing and Ju-Min Park in Seoul; Additional reporting by Heekyong Yang, Sijia
`Jiang and Mathieu Rosemain; Writing by Sayantani Ghosh; Editing by Himani Sarkar and Jason Neely
`
`Our Standards: The Thomson Reuters Trust Principles.
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`https://www.reuters.com/article/us-china-chips-outlook/chip-results-augur-more-tech-gloom-as-slowing-china-weighs-idUSKCN1PI0YC
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`5/13
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 7 of 14 PageID #: 3525
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
`M O R E F R O M R E U T E R S
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`https://www.reuters.com/article/us-china-chips-outlook/chip-results-augur-more-tech-gloom-as-slowing-china-weighs-idUSKCN1PI0YC
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`6/13
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`PUBLIC VERSION
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 8 of 14 PageID #: 3526
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
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`https://www.reuters.com/article/us-china-chips-outlook/chip-results-augur-more-tech-gloom-as-slowing-china-weighs-idUSKCN1PI0YC
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`7/13
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 9 of 14 PageID #: 3527
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 10 of 14 PageID #: 3528
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
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`https://www.reuters.com/article/us-china-chips-outlook/chip-results-augur-more-tech-gloom-as-slowing-china-weighs-idUSKCN1PI0YC
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`9/13
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 11 of 14 PageID #: 3529
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`Chip results augur more tech gloom as slowing China weighs - Reuters
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 12 of 14 PageID #: 3530
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
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`Case 5:19-cv-00036-RWS Document 66-43 Filed 08/27/19 Page 13 of 14 PageID #: 3531
`8/22/2019
`Chip results augur more tech gloom as slowing China weighs - Reuters
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