Category: 3. Business

  • Hong Kong reaps the fruits of fintech seeds sown nearly 10 years ago

    Hong Kong reaps the fruits of fintech seeds sown nearly 10 years ago

    When Alvin Kwock, co-founder of digital insurer OneDegree, took part in the inaugural Hong Kong FinTech Week in November 2016, it was held at a venue suitable for only a few hundred people.

    “As it was the first ever fintech event in Hong Kong, only fintech start-ups were interested, no big financial institutions paid attention,” Kwock said. “People did not have a clear idea of fintech as it was still in an exploratory stage.”

    In the years since, fintech in Hong Kong has gone through a sea change. “Now fintech is no longer confined to a few start-ups; it’s on the top of the agenda of banks and insurers,” Kwock said.

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    The venue has moved from the PMQ (formerly the Police Married Quarters) to the massive Hong Kong Convention and Exhibition Centre, with the number of attendees growing 18-fold to 45,000 people. At the recent forum, speakers included some of the most high-profile figures in the financial sector like HSBC CEO Georges Elhedery and Standard Chartered Bank CEO Bill Winters.

    HSBC CEO Georges Elhedery (left) takes part in a discussion with Financial Secretary Paul Chan Mo-po (centre) and Standard Chartered CEO at the Hong Kong FinTech Week on November 3. Photo: Jonathan Wong alt=HSBC CEO Georges Elhedery (left) takes part in a discussion with Financial Secretary Paul Chan Mo-po (centre) and Standard Chartered CEO at the Hong Kong FinTech Week on November 3. Photo: Jonathan Wong>

    This maturation has intensified Hong Kong’s long-standing rivalry with Singapore. The two cities are competing to develop fintech, a rivalry highlighted this month as both hosted their 10th annual flagship fintech festivals.

    While attendance in Hong Kong may have been thinner than in Singapore, the city has an edge over its Southeast Asian rival, thanks to its vibrant capital market providing funding for fintech companies and serving as a gateway to the Greater Bay Area.

    Hong Kong secured the world’s top fintech ranking for the first time in the Global Financial Centres Index in September, while Singapore ranked fourth, according to the report by Z/Yen and the City of London that tracked 116 centres based on criteria like regulations, access to finance and talent.

    In the inaugural survey on fintech in 2017, Hong Kong ranked seventh and Singapore eighth. The same year, the Hong Kong Monetary Authority (HKMA) introduced the first phase of fintech development.

    Since then, the HKMA has issued eight digital banking licences, with the lenders offering online-only services. This week, British digital bank Revolut announced plans to launch operations in Hong Kong.

    The arrival of global players is a direct result of a concerted regulatory push – the HKMA’s fintech initiatives, the Insurance Authority’s promotion of virtual insurance, and the Securities and Futures Commission’s rules for virtual asset trading. Bourse operator Hong Kong Exchanges and Clearing’s listing reforms too have paved the way for start-ups to raise funds.

    “Hong Kong’s fintech development in the past decade has been nothing short of transformative,” said HKMA chief executive Eddie Yue Wai-man in a written interview. The 18-fold increase in the number of participants in this year’s FinTech Week compared with nine years ago was “proof not only of growing interest but also of a hub that has become a magnet for talent, ideas and ambition in fintech”, he said.

    However, a broader measure of digital competitiveness reveals ongoing challenges. Despite Hong Kong’s many advantages, Singapore ranked third and Hong Kong fourth in the 2025 World Digital Competitiveness Ranking released earlier this month.

    The report, however, noted that Hong Kong performed the worst in “IT integration”, placing 29th overall, due to low scores in government cybersecurity capacity and legal framework for privacy protection.

    Singapore, which topped the ranking in 2024, fell behind Switzerland and the US this year.

    The report said Singapore was strong in its digital regulatory framework and hi-tech patent grants, topping these categories. The institute also highlighted Singapore’s weakness in two areas, where it ranked 29th in technology, media and telecommunications stock market capitalisation and 61st in telecommunications investment.

    Analysts and fintech firms regard Singapore and Hong Kong as Asian fintech leaders, albeit with different roles.

    “Singapore offers a more accessible pathway for regional expansion across Asean, whereas Hong Kong’s competitive strength remains closely tied to the China-Hong Kong corridor and its leadership in regulated digital-asset innovation,” said Benjamin Quinlan, CEO and managing partner of Quinlan & Associates, a Hong Kong-based consultancy.

    Quinlan said Hong Kong had also made progress in digital asset and tokenisation initiatives, including the coming stablecoin regime and tokenised government bond issuance, which provided a unique competitive angle in this emerging sector.

    Singapore, by contrast, had positioned itself as a launch pad for the Association of Southeast Asian Nations, while the country had a clean regulatory environment and was innovation-friendly, supported by comparatively lower barriers to entry and a strong investor appetite, Quinlan said.

    The HKMA’s Yue said the gateway role to mainland China would continue to be a major advantage for Hong Kong’s fintech development, as companies took advantage of cross-border trading schemes in stocks, bonds, swaps, exchange-traded products and wealth management.

    Yue added that the development of fintech had benefited many sectors like digital banks, while also making it easier for small and medium-sized enterprises (SMEs) to get bank loans via the Commercial Data Interchange (CDI).

    The CDI, which was launched in October 2022 as part of the HKMA’s Fintech 2025 strategy, is a financial data platform designed to make it easier for businesses, especially SMEs, to access financial services. The CDI had facilitated over 71,000 loan applications totalling HK$58.1 billion (US$7.5 billion) for SMEs until the end of September.

    “Think of a wonton noodle shop that could use the CDI to share its historical turnover data from point-of-sale terminals with a bank, which could then use this alternative data for a more accurate credit assessment and loan approval, all without requiring traditional collateral,” Yue said. “We are also advancing trade finance digitalisation through CargoX to support SME traders in a complex global trade landscape.”

    Project CargoX is a public-private collaboration led by the HKMA to use cargo and trade data to improve trade finance.

    The HKMA’s Faster Payment System has over 18 million users. Photo: Handout alt=The HKMA’s Faster Payment System has over 18 million users. Photo: Handout>

    One of the HKMA’s first fintech initiatives was the launch of the Faster Payment System in 2018, with the platform currently boasting more than 18 million users. This was followed by licences for eight digital banks in 2019.

    Even in a market with more than 150 lenders, these virtual banks had 3.4 million customers, with HK$77 billion in deposits and HK$29 billion in loans as of June, according to the HKMA.

    To build on this decade of progress and solidify Hong Kong’s future position, Yue unveiled the Fintech 2030 road map this month. The five-year programme will launch more than 40 initiatives in four areas: data, artificial intelligence, resilience and tokenisation.

    The city has also incubated some prominent fintech unicorns – start-ups with a valuation of at least US$1 billion – like Airwallex, HashKey Group, WeLab, Micro Connect and ZA Group.

    Hong Kong currently has more than 1,200 fintech companies, a 10 per cent increase from last year, with the sector’s revenue expected to exceed US$606 billion by 2032, according to a recent report by the Financial Services Development Council.

    The UK’s Revolut will add to the tally.

    Revolut is a global disrupter with over 65 million clients and has a strong presence in the US, Europe and Asia, so adding Hong Kong was the next stop in the expansion, said Camilo Ramirez, head of financial services at Sia Partners Hong Kong, a consultancy.

    “While Hong Kong looks like a saturated market, it still lags behind in digital capabilities compared with Europe and mainland China,” Ramirez said. “With the HKMA launching the fintech road map, Revolut would land in a perfect environment to bring its innovative capabilities to Hong Kong at a pivotal and exciting moment for the financial services industry.”

    Alvin Kwock, co-founder of online insurer OneDegree. Photo: Handout alt=Alvin Kwock, co-founder of online insurer OneDegree. Photo: Handout>

    One Degree’s Kwock said the conversations around fintech had continued to evolve at FinTech Week. Initially, it was about exploring the use of fintech, which later shifted to digital banks, digital insurance and virtual assets trading, before moving to AI this year, he said.

    “Cybersecurity will be a key issue going forward as the city becomes a virtual-asset trading hub,” Kwock said.

    Meanwhile, home-grown fintechs like WeLab have been using their early-mover advantage to good use by expanding in Southeast Asia.

    WeLab serves 70 million customers via its WeLend online lending platform and two digital banks in Hong Kong and Indonesia, WeLab Bank and Bank Saqu, respectively.

    “Positioned at the nexus of two major growth corridors – northbound to the Greater Bay Area and mainland China, and southbound to the rapidly growing and digitally transformative markets of Southeast Asia, Hong Kong acts as a natural springboard for regional fintech expansion,” said Simon Loong, founder and group CEO of WeLab.

    Fintech has also transformed one of Hong Kong’s oldest banks. The 160-year-old HSBC has seen an increase in digital use across all banking transactions.

    “We are already a fully digital bank, prioritising digital channels to deliver daily banking services and engage with our customers,” said Maggie Ng, CEO and head of retail banking and wealth at HSBC Hong Kong.

    Ng said HSBC would take part in the HKMA’s Fintech 2030 projects. The bank had already introduced tokenised deposits for customers, and its digital asset platform, HSBC Orion, was used to launch the world’s largest digital bond issuance by the Hong Kong government this month, she said.

    The bank recently launched HSBC Gold Token, a tokenised gold product for retail customers in Hong Kong.

    Also this month, Hong Kong and Shenzhen launched a joint fintech action plan to promote cross-boundary financial innovation, setting a target of establishing over 20 fintech application scenarios by the end of 2027. Secretary for Financial Services and the Treasury Christopher Hui Ching-yu, who signed the initial pact with Shenzhen, said the two sides would implement various initiatives to facilitate high-quality fintech development.

    Paul Sin, chair of the web3 and technology committee for Greater China at CPA Australia, an accounting industry body, said Hong Kong’s Fintech 2030 initiative provided a clear road map for the next five years.

    One element that Hong Kong needed to develop was a decentralised identity (DID) system, which would allow financial firms to easily verify users’ identities.

    “Only when firms can easily verify clients’ identities using technology like DID can fintech solutions be both innovative and compliant,” Sin said.

    This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2025 South China Morning Post Publishers Ltd. All rights reserved.

    Copyright (c) 2025. South China Morning Post Publishers Ltd. All rights reserved.


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  • Silicon Valley sets its sights on building the perfect baby

    Silicon Valley sets its sights on building the perfect baby

    If you could design your ideal baby, what would you choose? A lover of naps who sleeps through the night? A mind for math and an affinity for the viola? For the founders of fertility tech startup Herasight, this is not a hypothetical. 

    Herasight founder Michael Christensen is 6-foot-6, and even in a world where taller men are perceived as stronger and more competent, it’s a bit much. He wants his future children to be shorter and more comfortable on commercial planes. 

    “It’s annoying to be super tall,” he said. “Nothing is made for you.” 

    Chief science officer Tobias Wolfram has already banked frozen embryos with his partner in preparation for their future family. His great-grandparents lived past 100 with no cancer or serious health problems, suggesting a family tendency toward healthy aging. But there’s depression on his side of the family. 

    “I’d really like to make sure that’s not passed down,” he said. Wolfram has waited five years for Herasight’s technology to reach its current state, so that he can screen embryos for mental health indicators. 

    Jonathan Anomaly, a communications executive with Herasight, is approaching 50 and planning a family with his partner, 37. His grandmother was a genius, said Anomaly, but she suffered from five different autoimmune disorders that kept her homebound. He plans to screen embryos for autoimmune diseases, and like Christensen, Anomaly said he’ll screen for height. But he wants potential sons to be slightly taller than his 5 feet 9 inches. 

    This is the new era of family planning emerging across the Bay Area, a place known for its concentration of extreme wealth, high risk tolerance, affinity for new technology, and early-adopter mentality. Rather than having babies the Where Did I Come From? way, prospective parents are blazing an unprecedented approach to family planning. Gone are the wealthy parents who pay women for their eggs because they have desirable traits or who seek out sperm donors based on Ivy League degrees and athletic prowess. This is reproduction reimagined through the lens of algorithms and data science down to the genetic blueprint that makes up a human being. 

    This new method means opting for IVF from the start even if infertility isn’t an issue to create embryos. From there, prospective parents are investing thousands in different types of next-level embryo screening that can essentially spin up versions of your future children’s health prospects by showing their risk of inherited diseases, childhood cancers, schizophrenia, autism, and Types 1 and 2 diabetes. Other traits like height, body mass index, musical ability, and higher IQ points are also among the offerings at certain firms. And with billionaires backing fertility tech startups and funding new research related to conception and embryo selection, the boundaries between proven science, emerging possibilities, and aspirational hype become increasingly complex to parse.

    On the outer edges, scientists and researchers are studying the efficacy of penis transplants, and five have been performed worldwide so far, including one in the U.S. Uterus transplants have led to 29 live births, nearly all by C-section. A team of Chinese scientists successfully conceived mice with two male mice fathers—without DNA from a mother mouse. And more is on the horizon, including AI-enabled and automated IVF processes that could lower costs substantially and artificial womb development. A height and intelligence screening startup backed by Reddit and Seven Seven Six fund founder Alexis Ohanian plastered New York City subway stations with ads this month for Nucleus Genomics, imploring riders to “Have Your Best Baby.”

    The global IVF industry remains a nascent $28 billion enterprise, and investment in women’s health and IVF-related tech startups began picking up last year, with 2024 standing out as the largest year for investment at $2 billion, a 55% increase over 2023. 

    Some of these new add-ons to IVF are driven by people who just “want to know” about their embryos in the way people want to find out the sex of their baby before birth, said Barry Behr, director of Stanford’s IVF lab and a professor of obstetrics and gynecology who is known for his groundbreaking work in improving IVF and advancing the field of embryo selection. Other times, it’s about how to make more money from the IVF process or lower the cost for patients. Regardless of the motivation, for anyone who has had a child or relative who has been sick with a debilitating disease or condition, “you know how that makes you feel,” said Behr, who is an advisor to Orchid Health, which offers embryo screening. 

    “A parent would do anything—give a kidney, give a limb, or whatever you could give to a child to avert suffering,” said Behr. “So don’t tell me how anyone could even question doing something to your embryo that we do for other reasons routinely.” 

    Yet the rapid pace of innovation and investment has created a regulatory and ethical vacuum, experts have observed. “Technology will always outpace the law,” said Rich Vaughn, a prominent fertility lawyer who has seen the field evolve during the past two decades. “Technologies develop first; law and regulations make things legally safer for everyone, but they trail behind.”

    Moreover, the controversial process of embryo editing—which refers to changing the DNA of an embryo before it is implanted and is illegal in 70 countries or banned through funding restrictions—is being studied and backed financially despite the considerable risk involved. Coinbase cofounder and billionaire Brian Armstrong said he invested in embryo-editing startup Preventive, which has raised $30 million. Armstrong is joined by OpenAI CEO and cofounder Sam Altman’s husband, Oliver Mulherin. 

    Another startup focused on embryo editing is led by former Thiel Fellow Cathy Tie, who wants to genetically correct mutations in embryos before they are implanted to dramatically minimize the risks of inherited disease. (Investor Peter Thiel offers a two-year, $200,000 fellowship program to entrepreneurs who want to drop out of or take time off from college to focus on developing an idea.)

    “I believe that gene correction technology is much more effective in achieving those goals than embryo screening,” said Tie, cofounder of Manhattan Genomics. She plans to begin testing on nonhuman primates early next year before moving to human embryos, pending regulatory approval. 

    Tie believes many couples, especially those with relatively older women, wind up with too few embryos to choose from after they go through the process of stimulating their follicles and retrieving eggs. “Let’s say I’m a woman in my mid-thirties,” said Tie. “I’m lucky if I’ll get 10 eggs, and from that I’ll maybe get two embryos. Then a company will tell me one embryo is better than the other.” Despite public controversy over embryo editing, which alters genes that would be passed down to new generations and involves irreversible decision-making, Tie said she has received a lot of support from researchers, scientists, and IVF doctors. 

    Hank Greely, a Stanford law professor who specializes in issues surrounding biomedical technologies and authored The End of Sex, a 2016 book that predicted humans will eventually reproduce mainly through IVF, told Fortune screening for cosmetic traits like hair, eye, and skin color or nose shape isn’t far off. 

    People in Silicon Valley, where Greely lives,are most interested in influencing their offspring’s intelligence, personality, musical and sports ability, and proficiency in math. Right now those are areas scientists “know almost nothing about,” he said. 

    But the technology is moving at a swift pace, and some experts think the line between acceptable and not will evolve as well. 

    “There was a time when it wasn’t appropriate to show your knees, and now you can wear a thong at the beach,” said Behr. “The line moves with time.”

    The new line in tech-assisted IVF

    Reproductive tech startup CEO Noor Siddiqui has a personal inspiration behind founding polygenic screening firm Orchid Health. Her mother suffers from a rare genetic eye condition called retinitis pigmentosa, which led to progressive vision loss and her mother’s eventual blindness. Siddiqui, also a Thiel Fellow, said she was motivated to pursue embryo screening after watching her mother’s condition progress. Siddiqui also plans to have four children, and has screened her own embryos using Orchid’s technology. 

    The firm occupies the middle ground of the IVF tech market—pushing the boundaries of science, but mainly to prevent disease.

    For years now, prospective parents who use IVF to have babies have been able to opt for preimplantation genetic testing to make sure the embryo has the correct number of chromosomes. In addition to chromosomal abnormalities like trisomy 21—an extra copy of chromosome 21 that causes Down syndrome—tests also scan for life-altering diseases stemming from single-gene mutations like sickle cell anemia or cystic fibrosis. 

    Orchid offers “polygenic risk” scoring for their embryos. The startup counts Day One Ventures and Prometheus Fund among its backers, as well as angel investors including Figma CEO Dylan Field and 23andMe cofounder Anne Wojcicki. Eventbrite cofounders Julia and Kevin Hartz have also invested in Orchid, and the couple screened their embryos for inherited diseases including Alzheimer’s before having twins they dubbed “Cohort 2” after their first two daughters were in their teens. Published reports have anonymously quoted sources claiming that Shivon Zilis, who has children with the world’s wealthiest man, Elon Musk, has used Orchid’s services. 

    Orchid’s approach involves whole genome sequencing, and expands on traditional screening by sequencing nearly all of an embryo’s genome. Siddiqui said Orchid scans for more than 1,000 genetic diseases as one option for clients, while another option scans for 3,000 single-gene diseases, covering inherited and spontaneous changes in the embryo. Traditional tests scan for chromosome numbers and single-gene disease. She often compares it to publishing a book that a writer would want to be fully accurate. 

    “If your proofreader didn’t actually read your book to check for spelling errors, missing words, missing punctuation, would you be satisfied if they just told you all the chapters were present?” she said. Siddiqui said parents are also interested in the genetics of autism, and Orchid screens can detect genetic mutations in specific genes known to cause autism spectrum disorder, although it cannot predict all autism risk. Experts have warned that there is no reliable test for autism, although recentstudies have found a genetic cause in 25% to 50% of cases. 

    “We want the maximum amount of information to be provided to parents to mitigate the maximum amount of risk when it comes to genetics,” said Siddiqui. 

    Herasight, the startup with the three founders who each are hoping to screen for traits in their next generation, recently emerged from stealth mode after several years and conducts polygenic screening with a different technical approach that allows it to work with any IVF clinic. It screens the data for potential childhood and adult diseases and health problems, and in some cases height, IQ, longevity, and mental health conditions like depression. 

    The firm offers a free IVF calculator so prospective parents can get an idea of their chances at conception, from retrieving eggs through birth, based on more than 100,000 IVF treatment cycles recorded in the U.K. national registry. Herasight’s published studies show it can reduce disease risks by 20% to 44% when selecting among five embryos. The validation results come from the firm’s own research rather than independent studies, but Herasight has published its methods and data for others to review. The company’s research has shown what they call “positive pleiotropy,” which means when selecting against one disease, parents often reduce risks for related conditions, too. 

    “Everyone has a unique family history, so we don’t have one type of customer,” Christensen told Fortune. Sometimes a prospective parent will come to the firm, excited about screening embryos for IQ, and then they’ll discover a BRCA gene mutation, which can increase the risk of breast and ovarian cancers. Then that becomes the top priority in screening embryos, said Christensen. Anomaly said every embryo-screening choice represents a tradeoff. “Creating the perfect baby—that doesn’t exist,” he added. 

    Kyle Farh, a scientist with DNA sequencing and genetic analysis company Illumina’s artificial intelligence lab, said a huge gap in data interpretation remains at the moment because AI models simply need more information. About 1 million people globally have sequenced their genomes, and realistically about 1 billion people need to sequence their genomes for models to function more meaningfully. 

    “It’s a chicken and egg problem,” said Farh. “We can predict [traits], and we can show that there’s some significant correlation between our predictions and what happens in real life, but the correlation is still very poor.”

    But for parents looking to prevent a major life-altering disease, the technology has been transformative. Software engineer and consultant Roshan George and art director Julie Kang, who live in San Francisco, hired Orchid to screen their embryos after the couple discovered they shared a genetic mutation that could cause profound deafness in their children. One day after having their newborn daughter, Astra, it took about two minutes to find out if the thousands they invested in embryo screening had helped them toward the outcome they wanted for their child. A tech gave Astra a hearing test in their sunny Sutter Health hospital room, the culmination of months of genetic analysis and embryo risk scores. 

    “I mean, we spent all this money, we did this whole thing and got through all this,” said George. The test showed Astra’s hearing was normal, and the new parents were relieved and are planning for another child soon; they still have screened embryos, George said. 

    Cases of preventing disease are growing, which is giving these startups a boost. And in addition to screening for certain health risks, founders are hopeful that the impact on pregnancy loss for couples and families who go through IVF will be substantial. Certainresearch shows chromosomal abnormalities are responsible for about 50% of first-trimester miscarriages, and the hope is that screening allows people to prioritize embryos most likely to result in successful pregnancies. 

    But the use cases that scientists and ethicists fret about aren’t quite here—yet. “Even the most optimistic folks—and I think scientists and most geneticists are way too optimistic—think they can account for, oh, three or four IQ points,” said End of Sex author Greely. “Plus, we know plenty of ways to improve IQ test results with things like good childhood nutrition, childhood vaccinations so kids don’t get sick, and parents who read to their kids.” Brains are incredibly complicated, he said, and may ultimately prove too complicated to screen for intelligence and qualities like extroversion. 

    “It makes great headlines, it makes great clickbait, it makes great dystopian science fiction,” said Greely. “But the designer baby idea? At least when you’re talking about behavioral traits, it’s not very plausible—at least for decades.”

    But given the intensity and expectations of the tech-oriented set interested in this brave new world, NYU bioethicist Arthur Caplan notes there’s a danger that some parents might view their children as products and potentially even “commercial failures.” He questions how positive this will be for kids. “When you start saying, ‘I tested you, and I have a certain outcome that I expect,’ you’re taking away the kids’ future,” said Caplan. “You’re making them less free because you have expectations, and they better turn out that way.”

    Victoria Fritz and her husband, who used Herasight to screen embryos to try to prevent passing along her Type 1 diabetes, hope to do an embryo transfer in January, and are realistic about the prospect.

    “I feel like, regardless of what embryo we choose, we will hopefully have a happy, healthy child and be a happy family regardless,” said Fritz. The screening provides peace of mind, she noted, but “it doesn’t guarantee that your child is going to have a perfect, healthy life.”

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  • Effectiveness of Combined Preoperative and Postoperative Rehabilitation Versus Postoperative-Only Rehabilitation in Cardiac Surgery Patients: A Systematic Review

    Effectiveness of Combined Preoperative and Postoperative Rehabilitation Versus Postoperative-Only Rehabilitation in Cardiac Surgery Patients: A Systematic Review

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  • On the participation in the “Nanshan Dialogue”

    On the participation in the “Nanshan Dialogue”

    On November 27, 2025 the latest “Nanshan Dialogue” titled “Engaging with the SCO, Starting from Nanshan — Regional Cooperation in the New Era” was held in Shenzhen. The event was organized by the Nanshan District People’s Government and World Affairs Press.

    The forum aims to strengthen ties between Chinese businesses, including innovative enterprises, and the member states of the Shanghai Cooperation Organization.

    On the participation in the “Nanshan Dialogue”

    During the discussions participants highlighted the significant potential of the SCO member states and discussed prospects for enhancing cooperation with the dynamically developing Nanshan District, which is known as a leading center for scientific and technological innovation in China.

    A report was delivered by former SCO Secretary-General Zhang Ming. The key themes of his address were opportunities for small and medium-sized enterprises and the implementation of multilateral economic projects within the context of China’s policy of openness to the international market.

    Representatives of the SCO Secretariat also took part in the forum.

    As part of the program guests visited leading technology companies in Nanshan District and learned about achievements in the fields of high technology and innovation ecosystems.

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  • Assessing NICE Stock After a 45% Drop and New Technology Partnerships in 2025

    Assessing NICE Stock After a 45% Drop and New Technology Partnerships in 2025

    • Wondering if NICE stock could be a hidden gem or just another falling knife? You’re in the right place to get an honest, in-depth take on whether it’s time to buy or wait.

    • The stock has seen a dramatic ride lately, climbing 3.4% in the last week but still sitting 22.8% lower over the past month and down a hefty 45.6% year-to-date.

    • Recent market headlines have focused on sector-wide volatility and shifts in investor sentiment, with NICE specifically highlighted for its approach to new technology partnerships and industry collaborations. This extra context is key, as news-driven swings are impacting short-term moves and shaping longer-term expectations.

    • With a valuation score of 4 out of 6, there is a lot more to unpack below the surface. Let’s dig into how different valuation methods assess NICE, and stick around to the end for a perspective that might change how you think about value altogether.

    Find out why NICE’s -48.1% return over the last year is lagging behind its peers.

    A Discounted Cash Flow (DCF) model estimates a company’s intrinsic value by projecting its future cash flows and discounting them back to today’s value. This approach helps investors gauge what a business is truly worth compared to its share price in the market.

    For NICE, its current Free Cash Flow stands at $684.36 Million. Analyst forecasts suggest steady growth, with projected Free Cash Flow reaching $963.8 Million by 2029. While analysts provide estimates for the next five years, Simply Wall St extends these projections further out and offers a longer-term perspective on future performance.

    Using these cash flow projections, the DCF model calculates a fair value of $688.13 per share. This suggests the stock is trading at a 50.7% discount compared to its estimated intrinsic value, indicating it may be undervalued at current prices.

    Result: UNDERVALUED

    Our Discounted Cash Flow (DCF) analysis suggests NICE is undervalued by 50.7%. Track this in your watchlist or portfolio, or discover 920 more undervalued stocks based on cash flows.

    NICE Discounted Cash Flow as at Nov 2025

    Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for NICE.

    For profitable companies like NICE, the Price-to-Earnings (PE) ratio is a key valuation tool. It shows how much investors are willing to pay today for each dollar of last year’s earnings. This metric is especially useful because it captures both a company’s ability to generate profits and the market’s expectations around its future growth and risks.

    Growth expectations and risk play a significant role in what constitutes a “normal” or “fair” PE. Higher growth companies often warrant higher multiples, while increased risk leads investors to be less willing to pay a premium. Therefore, looking only at the surface-level PE can be misleading if these factors are not taken into account.

    NICE currently trades at a PE ratio of 11.5x. For context, the average Software industry PE is 27.6x, and the average for NICE’s direct peers is a much higher 46.0x. At first glance, NICE appears significantly cheaper than others in its space.

    However, simply comparing with industry or peer averages does not provide the full picture. This is where the Simply Wall St “Fair Ratio” comes in. The Fair Ratio is a proprietary measure that considers a company’s own earnings growth, industry dynamics, profit margin, total market cap, and its unique risks. This more tailored approach helps move beyond the limitations of traditional benchmarking and offers a clearer sense of whether the stock’s valuation is justified.

    For NICE, the Fair Ratio is calculated at 10.7x, which is very close to its current PE of 11.5x. This indicates the market price is generally in line with the company’s underlying fundamentals at present.

    Result: ABOUT RIGHT

    TASE:NICE PE Ratio as at Nov 2025
    TASE:NICE PE Ratio as at Nov 2025

    PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1443 companies where insiders are betting big on explosive growth.

    Earlier, we mentioned that there is an even better way to understand valuation, so let’s introduce you to Narratives. A Narrative is your chance to put a story behind the numbers by combining what you know about a company’s strategy, risks, or catalysts, along with your assumptions for future revenue, earnings, and margins. Narratives connect your view of the company’s direction to a set of financial forecasts, which then generate your own fair value for the stock.

    The beauty of Narratives is their accessibility. On Simply Wall St’s Community page, millions of investors use Narratives to create, refine, and share their perspectives on companies like NICE. This tool empowers you to outline your story, back it up with the factors you believe matter most, and see how your assumptions compare to both analyst estimates and the market price.

    Narratives help you decide how your Fair Value relates to the current Price, and they dynamically update as new news or earnings are released, so your outlook stays relevant and actionable. For instance, one Narrative for NICE assumes rapid AI-driven revenue growth and gives a fair value over ₪750 per share, while a more cautious view highlights margin pressures and assigns a much lower value.

    Do you think there’s more to the story for NICE? Head over to our Community to see what others are saying!

    TASE:NICE Community Fair Values as at Nov 2025
    TASE:NICE Community Fair Values as at Nov 2025

    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

    Companies discussed in this article include NICE.TA.

    Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

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  • Are Rio Tinto Shares Attractive After a 13.8% Rise and Iron Ore Optimism?

    Are Rio Tinto Shares Attractive After a 13.8% Rise and Iron Ore Optimism?

    • Curious whether Rio Tinto Group is a bargain or just another big name in the market? You are not alone, and now is a great time to get the facts on its real value.

    • The stock has climbed 13.8% year-to-date and delivered a 16.6% return over the last 12 months. Recent weeks saw a small dip, showing both resilience and sensitivity to market shifts.

    • This movement has been driven by renewed optimism in global commodities, especially as ongoing infrastructure projects and demand from emerging economies continue to put upward pressure on iron ore prices. A recent surge in environmental investments has also caught investor attention, further influencing Rio Tinto’s position in the materials sector.

    • According to our valuation checks, Rio Tinto Group scores 5 out of 6 for being undervalued. We will examine this result in more detail by breaking down the numbers with different valuation methods, and later, share an even smarter way to make sense of it all.

    Find out why Rio Tinto Group’s 16.6% return over the last year is lagging behind its peers.

    A Discounted Cash Flow (DCF) model estimates a company’s true value by projecting its future cash flows and discounting them back to the present. This approach aims to reveal whether the market price is aligned with the business’s earning power over time.

    For Rio Tinto Group, recent financials show a last twelve months Free Cash Flow of $7.08 billion. Analysts anticipate strong ongoing growth, with free cash flow projected to rise to $15.26 billion by 2028. Over the coming decade, Simply Wall St extrapolates these trends and projects free cash flow to approach nearly $35.5 billion by 2035. All these projections are provided in the company’s reporting currency, U.S. dollars.

    The DCF model values Rio Tinto’s shares at an intrinsic fair value of $189.55, which is 71.4% higher than the current share price. According to this projection, the company appears significantly undervalued compared to where its cash flows are expected to be over time.

    Result: UNDERVALUED

    Our Discounted Cash Flow (DCF) analysis suggests Rio Tinto Group is undervalued by 71.4%. Track this in your watchlist or portfolio, or discover 920 more undervalued stocks based on cash flows.

    RIO Discounted Cash Flow as at Nov 2025

    Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Rio Tinto Group.

    For profitable companies like Rio Tinto Group, the Price-to-Earnings (PE) ratio is a widely used valuation metric because it connects a stock’s current price directly to its earnings power. A lower PE can suggest a bargain, while a higher one might point to high growth expectations or perceived safety. What counts as a “normal” or “fair” PE ratio depends on how much the market expects the company to grow and how much risk is involved. Faster growth or lower risk can justify a higher ratio.

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  • Assessing Valuation Following Recent Share Price Surge

    Assessing Valuation Following Recent Share Price Surge

    New Gold (TSX:NGD) has been getting some attention as investors look for value in the gold mining sector. The company saw its share price move higher this week, which has sparked curiosity about what might be driving renewed interest.

    See our latest analysis for New Gold.

    New Gold’s latest rally is not just a short-term blip. The 4.2% share price gain in a single day capped off a notable year-to-date surge of over 200%, with total shareholder return up 193% in the past year and momentum clearly building. Recent strength points to growing optimism about the company’s fundamentals and its role in today’s gold market.

    If this sort of momentum has you wondering where else to look, it might be the right moment to explore fast growing stocks with high insider ownership.

    With such rapid gains, the big question now is whether New Gold’s shares are trading below their true value, or if the strong performance means any future upside is already reflected in the price. Is there still a buying opportunity, or has the market fully priced in the company’s growth prospects?

    With New Gold’s fair value estimate set at $15.12, over 24% above its last close of $11.42, there is renewed debate among investors about how much further this rally could go, or whether the upside is already priced in. The most popular narrative driving this figure draws heavily on ambitious projections for revenue and earnings, as well as anticipated benefits from operational changes.

    Ramp-up of higher-grade ore production at both Rainy River (open pit and underground) and New Afton (C-Zone block cave), supported by strong operational execution and milestones achieved, is expected to drive increased gold and copper output at lower unit costs, directly improving revenue and net margins over the next 2 to 3 years.

    Read the complete narrative.

    Curious what makes analysts so bullish? The linchpin of this narrative rests on some bold growth projections and striking assumptions about margins. Want to know which financial leaps underpin this eye-catching fair value? Click through and discover the detailed forecasts behind the price target.

    Result: Fair Value of $15.12 (UNDERVALUED)

    Have a read of the narrative in full and understand what’s behind the forecasts.

    However, factors such as high operating costs or unforeseen setbacks during mine expansions could quickly dampen New Gold’s momentum and challenge the bullish outlook.

    Find out about the key risks to this New Gold narrative.

    If you have your own view on New Gold’s story or want to dig into the numbers firsthand, you can easily craft a personal take in just a few minutes. Do it your way.

    A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding New Gold.

    Don’t let opportunities pass you by. Use the Simply Wall Street Screener to uncover standout stocks that match your investment goals and could give your portfolio an edge.

    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

    Companies discussed in this article include NGD.TO.

    Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

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  • 25% of Warren Buffett’s Portfolio Is Invested in These 3 Unstoppable AI Stocks

    25% of Warren Buffett’s Portfolio Is Invested in These 3 Unstoppable AI Stocks

    • Berkshire Hathaway’s portfolio owns at least three leading tech stocks that are benefiting from AI.

    • All three of these juggernauts have excellent prospects beyond their AI-related work.

    • 10 stocks we like better than Apple ›

    Warren Buffett, often regarded as the greatest investor of all time, has historically been cautious about investing in technology companies. However, whether it was his doing or due to the influence of some of its investing lieutenants, Berkshire Hathaway‘s (NYSE: BRK.A) (NYSE: BRK.B) portfolio holds several tech stocks, or at least tech-adjacent ones. Some of them are notable players in the growing field of artificial intelligence (AI) as well, and could deliver excellent returns over the long run as they capitalize on this massive opportunity. Three stocks in the conglomerate’s portfolio, in particular, Apple (NASDAQ: AAPL), Amazon (NASDAQ: AMZN), and Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL), appear to be excellent AI stocks to buy.

    Image source: Getty Images.

    Despite Berkshire Hathaway selling Apple shares on multiple occasions in recent years, the iPhone maker remains the conglomerate’s largest holding. And although Apple is perceived as lagging behind some of its similarly sized tech peers in AI, the company is making slow but steady progress in that department. Apple added even more AI features to its latest iPhone, the 17, which is seeing strong demand. Management believes AI features are part of the reason.

    The iPhone 17 and the previous 16 are hitting supply constraints, preventing Apple from meeting the high demand for these models. Over the next couple of years, the company should see a strong renewal cycle, which will help boost sales.

    Meanwhile, Apple is significantly increasing its AI-related investments. Apple is likely still in the early stages of its AI strategy and will capitalize on its large installed base to further strengthen its ecosystem by adding a slew of AI features across its devices. And as it does, the company’s hardware business, particularly the iPhone, should continue to be a decent growth driver. Furthermore, Apple’s services segment will also continue to make progress.

    This long-term, high-margin opportunity will help boost profits as Apple’s more than 1 billion subscriptions continue to grow. All these factors make Apple’s prospects attractive and an excellent AI stock to buy and hold on to for a while.

    Amazon has become a leading provider of AI services. Through its market-leading Amazon Web Services (AWS), the tech giant offers such products as SageMaker, a service that helps companies build and train machine learning models. Perhaps Amazon’s best-known AI offering is Bedrock, through which it provides access to a library of generative AI models, including some of the market leaders. Amazon is also utilizing in-house AI to enhance efficiency and productivity.

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  • Elon Musk has started work toward his $1 trillion Tesla pay package. But 2 loopholes foreshadow how it could be a bust for shareholders

    Elon Musk has started work toward his $1 trillion Tesla pay package. But 2 loopholes foreshadow how it could be a bust for shareholders

    The $1 trillion pay package for CEO Elon Musk that Teslashareholders approved on Nov. 6—the world’s first—was labeled by the board as an exemplar of pay for performance. And at first glance, the program appears to fit that description in a big way: The hurdles it establishes for Musk to receive any compensation at all, let alone achieve the maximum 13-digit payout, appear the ultimate in stretch goals. Skeptical observers might wonder: “How could anyone be motivated by targets this seemingly unachievable?”

    On the other hand, Tesla loyalists and the three-quarters of Wall Street analysts issuing either a “buy” or “hold” on the EV maker praise the arrangement’s similarity to one from 2018 that spurred Musk to work wonders—at least in boosting the share price. Now, they’re positing: “Elon’s already done it once. Now he’ll be super-motivated to stay in the job and conjure a second miracle. And if that happens, stockholders will pocket another king’s ransom.” Musk concurs.

    A close examination of the new plan, however, reveals that it harbors a “betwixt and between” problem. The lower-hanging fruit are too easy to harvest, and the harder goals that would mark substantial and genuine progress in profitability too difficult to attain. Probable outcome: Musk gets nothing resembling the $1 trillion, but still pockets one of the biggest payoffs in corporate America—as shareholders suffer along the way.

    The reason the epic scheme risks backfiring: It contains two loopholes that enable Musk to fare handsomely by doing something he’s great at, hyping the stock via making big promises, then delivering just enough on the basic business end to clinch a rich reward.

    How Musk’s new pay package is structured

    The package consists of 12 tiered grants of restricted stock. Unlocking each “performance milestone” requires reaching both a valuation and an operational goal. It’s the safety deposit model: You need two keys to open the box. The market cap triggers start at $2 trillion and ascend by increments of $500 billion to the summit of $8.5 trillion, a number that’s 70% bigger than the $5 trillion that Nvidia recently notched to reign as the world’s most valuable company. The second group of keys are the “operational milestones.” Four cover sales for key products: separate, cumulative targets for deliveries of vehicles and “bots,” chiefly humanoid robots, as well as for robotaxis in commercial operation and subscriptions for full self-driving software. The other eight are Ebitda tiers that start at $50 billion, and max at $400 billion.

    Put simply, anytime Musk hits a new valuation goal, and also captures any one of the dozen operational targets in any order, he receives 35.312 million shares in Tesla restricted stock, adding roughly 1% to his current stake of almost 16%.

    The stunner that grabbed headlines, of course, is the $1 trillion in stock—424 million shares—Musk would receive for taking the market cap to $8.5 trillion, and also clinching all 12 of the operational objectives. Musk’s got 10 years to make the numbers that trigger the grants. The “earned share” tranches have two vesting periods: early 2033 for those achieved in the first five years, and late 2035, or at the end of the decade-long program, for the ones reached in years 6 through 10. On the Q3 earnings call, Musk repeatedly insisted that he needs to reach an ownership percentage in “the mid-20s” to ensure “enough voting controls to give a strong influence.” He effectively praised the board for handing him the opportunity to get there, and apparently thinks he stands a great chance at sweeping the board. That coup would get Musk where he wants to go by raising his stake to about 28%.

    The higher goals in Musk’s pay package look like a stretch too far

    In reality, Musk faces low odds of garnering any of the higher targets. Let’s start with the operational side. Hitting almost all but one of them would require moonshots. For example, the robotaxi target requires achieving an active fleet of 1 million. Today, Tesla offers only an extremely limited pilot plan in Austin, and Waymo, the industry’s largest player, has only 2,000 of the vehicles on the road. And the easiest Ebitda level stands at a towering $50 billion. Ringing the bell would likely require multiplying its current Ebitda run rate around fivefold. Yet Tesla’s now going in the wrong direction by booking puny and declining profits. Reversing that downward trend to reach even the minimum profitability mandated in the operational milestones can only happen if its unproven products prove wildly successful in highly competitive, and capital-intensive sectors.

    Now to the valuation milestones. Tesla’s stock already appears vastly overpriced. Its current multiple, based on “core” earnings from its auto and battery businesses of just $3.6 billion in the past four quarters, excluding such items as sales of regulatory credits, towers at 375. Hitting the second highest valuation mark of $2.5 trillion alone would require an 85% jump in its stock price. Huge progress that’s not happening is already baked into the valuation, making the chances of huge, sustained gains from here remote, though a Musk-orchestrated, ephemeral surge can always happen.

    Musk’s best shot: Ringing the bell on the two easiest goals

    Though Musk probably can’t scale the mountain, he may be able to mount the foothills.

    He stands a decent chance of scoring both the lowest valuation number of $2 trillion, and the least challenging operational tier—selling a cumulative total of 20 million vehicles, starting from the time of the grant. On the first item, the surge in Tesla stock since the board unveiled the program in early September has already pushed the price from $334 to $408, lifting its valuation from $1.12 trillion to $1.35 trillion—and the package gives Musk credit for that increase. So if Musk can boost the shares another 48% to $2 trillion, he’ll check the initial box for market cap. The rules require that the shares average $2 trillion or above for six months, and separately for the last 30 days, to hit the target.

    It could easily happen. Musk has proved a master at sending the shares skyward by promising great things in robotaxis, full self-driving (FSD), and robots, even though he hasn’t yet significantly commercialized any of them. More promises could breed more excitement that could breed another speculative frenzy in Tesla shares centered on great expectations.

    The operational part that’s reachable, especially over a longer period, is the goal of selling 20 million vehicles. This provision invites close scrutiny. According to the plan’s requirements contained in an SEC filing dated Sept. 5, this target doesn’t start from zero at the time the package takes effect. It’s a cumulative total over the entire history of Tesla. Here’s the wording: “20 Million Tesla Vehicles Delivered: Expanding Tesla’s vehicle fleet from 8 million EVs, which it has currently, to 20 million will further grow its adjusted Ebitda, allowing Tesla to reinvest in its other up-and-coming product lines.” Hence, since Tesla has already sold 8 million cars, it only has to deliver 12 million for Musk to capture that operational hurdle.  

    It’s an incredibly weak requirement, and one of the two wrinkles that aids Musk and skewers shareholders. In the past four quarters, Tesla has delivered 1.9 million cars, and Musk is pledging to expand the lineup to encompass a new affordable EV, and sell self-driving cars to customers. If it averages 2 million cars a year, Tesla would achieve the 12 million figure by the end of year six. Hence, Musk would clinch an operational target by achieving only a minimal annual increase in Tesla’s vehicle sales.

    Here’s the second softball pitched by the board. If Musk manages to get the market cap to $2 trillion or above, and keep it there for six months, he’s turned that key definitively. No going back. No matter what happens to the share price after that, he’s got that bogey in his pocket. As Tesla’s SEC filing detailing the plan states, “Once a Market Capitalization Milestone or any particular Operational Milestone is achieved, it is forever deemed achieved for purposes of the eligibility of the Tranches to become Earned Shares.” 

    So let’s say Musk is able to notch the $2 trillion target in six years. Then the shares bounce around, going above and below that level, so that by the end of the 10-year grant period in late 2035—by which time he’s added the 20 million vehicles prize—its cap is $1.95 trillion, or $585 a share. In other words, Musk could talk up the shares, then see them pretty much go sideways for years, and they could even head below the price that unlocked the award.

    Fortunately for shareholders, the stock grants come with a feature similar to equity options that somewhat reduces Musk’s payday, especially in a case like the one above where the plan flops. Musk only gets the gain over the stock price at the time of the grant—in other words, just the appreciation. He’d receive the first tranche of shares at a “net” of $251 per share, that’s the $585 at the end of the 10-year vesting period minus the effective “strike” price of $334 (the price when the program was conceived in September). Hence, he’d pocket $8.86 billion in one stroke (the equivalent of 35.3 million shares x $251).

    That would be all of his compensation for 10 years of running Tesla. To be sure, he’d wait a long time for the money, and it isn’t anywhere near the trillion he apparently believes is feasible. But it’s still big, averaging almost $90 million a year. By comparison, in their respective fiscal years, Sundar Pichai earned $10.7 million, Mark Zuckerberg $27.2 million, Jensen Huang $34 million, Jamie Dimon $39 million, Andy Jassy $40 million, Tim Cook $75 million, and Satya Nadella $79 million.

    What about the shareholders? Taking the shares from $334 to $585 in 10 years represents paltry gains of just 5.9% annually. That’s a lousy deal for Tesla’s shareholders. They’re suffering at the same time Musk is en route to getting a windfall of nearly $900 million.

    Say Tesla’s shares do even worse and end the 10-year grant period at a market cap of $1.8 trillion, $200 billion below the goal of $2 trillion that Musk achieved at one point but couldn’t increase or even hold on to. Shareholders would get returns barely beating inflation, and Musk would still get a payout of $727 million.

    To complicate matters, it’s likely that failing to collect on any of the other, extremely challenging tranches will prove a downer for Musk. In our scenario, he’d only increase his stake in Tesla by 1% when his goal is a rise of over 10 points. Musk would have a strong incentive to stay the full 10 years for the haul waiting at the end. But an unhappy Musk might mean a less-than-fully-motivated Musk. This package could hammer shareholders while they witness the decline of the idol it’s designed to empower.

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  • The CEO of the world’s largest data center company predicts will drive the business forward

    The CEO of the world’s largest data center company predicts will drive the business forward

    Adaire Fox-Martin understands the needs of Big Tech. Prior to becoming CEO of Equinix (No. 446 on the Fortune 500) last year, she held senior roles at Google, SAP and Oracle. Now, the Irish-born former teacher is driving the expansion of the world’s largest global data center network, with more than 273 data centers in 36 countries. Fox-Martin recently spoke with Fortune about what she learned in her first year in the job and where she wants to go from here. 

    This interview has been edited and condensed for clarity. 

    We last met when you were starting out in the role.

    It’s been an incredible year of learning and realizing that this job doesn’t come with an instruction manual. You bring the experiences that you’ve had in the past to the decisions that you make for the company for the future. We’ve laid out the strategy and optimized it into 10 simple words. The first of those is “build bolder.” which is how we’re designing and constructing the infrastructure that underpins the digital economy.

    The second part of our ten-word strategy is “solve smarter.” This is about how we abstract the complexity of networking and architecture, which is our secret sauce, and render that for our customers, making Equinix the Easy button. The third piece is to “serve better.” Most participants in the data center industry have five or six customers; we have more than 10,000 enterprise customers. So those are the three pillars. 

    What are the other four words?

    Underpinning that, we have “run simpler,” which sounds easy to say and is very hard to do. You’re taking complexity out of your business, looking at systems and processes. And the last piece is our people piece, which is to “grow together,” growing our business with our customers, linking our employee success to our customer success. 

    Is that a big change?

    Equinix has been a company in this segment for 27 years, so we’re one of the long-term players in this industry. And in the next five years, we’re planning to bring on as much capacity as we did in the last 27 years. That’s a big capital investment for us. 

    Where do you sit in the data-center ecosystem?

    I think there’s a general trend to think of data centers as a homogeneous mass of a singular thing. But there are four distinct categories of data centers, and each one has its own nuance and characteristics. We exist in one of those categories. There’s the hyperscale category, the ones built by cloud-service providers, where you see massive investment. The second category is wholesale, where you’re usually building a facility to lease back to one tenant, maybe two, usually supporting (AI) training. The third is enterprise, where big companies like banks want to have their own center structure. And the fourth category is colocation, which is where Equinix sits.

    And what are the advantages of that? 

    Think of us a little like an airport authority. It manages the runaways and the facilities of the airport and gives you the ability to rent ticketing and other kind of facilities in there. Then it manages the process of passenger engagement, so an airline comes in, like KLM, drops a passenger, and then magic happens in the background to move that passenger and their luggage to United to go on to California. We’re a little bit like the airport authority of the internet: a data package comes into Equinix and then moves on to where its next destination is. The difference between us and an airport authority is that the airport lines will compete whereas a lot of our customers colocate so they can collaborate. 

    What do you do in terms of AI workloads? 

    We do both training and inference. A pharmaceutical company would do their training privately at Equinix because in the pharma world much of their research and drug discovery processes have to go through private models for regulatory reasons or intellectual property protection. Training is like teaching the model and then inference really putting what the model has learned to work. 

    What about the energy needs?

    The different types of data centers have different characteristics when it comes to energy, who they’re starving, or how they’re supporting local economies and communities. 

    We’re smack bang in the middle of what I would describe as an energy super cycle. Data centers are one component of it, but so is the electrification of everything. You have the speed of an AI meeting the pace of utilities, and it’s a headfirst collision. We don’t think it’s an insurmountable challenge but it’s going to require collaboration, innovation and time. 

    How do you seeing it playing out?

    Between now and 2028, it’s fair to say there is a power crunch.  Anything that we’re delivering until 2028, we understand where our power will come from. From 2028 to 2032, you’ll see an innovation click into the power landscape, in the form of data centers and data center operators looking at how they can self-generate, how they can generate on site, how they can innovate with the grid, and give power back to the grid, how they can be flexible on and off the grid.  You’ll see different aspects of innovation, including nuclear, looking at small modular reactors and how they can be utilized. 

    From 2032 on, the utilities have introduced some changes. In the past, you would go to a utility and say, ‘I want this much here in this time, just-in-time power provision.’ For someone like us, which doesn’t have the same power draw as a hyperscale data center, that was usually good enough. But utilities are looking at their power framework in the form of cluster studies, taking a group of requirements together in a cluster at the same time. You define the load that you’re going to ramp up to and it will likely take the form of take or pay. If you said you’re going to use this much, you will pay for it, whether you use it or not. 

    It’s important that large energy users, like data centers, pay a premium for what they’re utilizing so that we don’t impact small ratepayers, small energy users, so there’s a lot happening around collaboration. We’ve got a 27-year history of that kind of collaboration with the utilities and so we’re very involved in a number of those processes. 

    Talk about the challenge of building these centers.

    One is supply chain, the things that are needed to construct a data center, some of which have been subject to tariffs. In the short term, that’s not an issue but longer term, that may become something that we have to navigate our way through. And then there’s the workforce, the plumbers and mechanical engineers and welders who are maintaining our environments that keep the internet up. A lot of trade skills, construction skills and technical skills are necessary to create the data center. 

    Are the centers you’re building for these workloads any larger than the ones that you built in the past? 

    We do support our hyperscaler partners with the provision of data centers, through a vehicle called xScale, which is a joint venture. We have partners who fund our joint ventures, so we do participate in what I described as the wholesale economy by building what’s called a build-to-suit data center industry for a hyperscaler. So a Google would come to us and say, ‘do you guys have power and land in location X? And would you build for us?’ So we do that through a joint venture off our balance sheet because the capital-intensive nature of that is high. We own 25% of our America JV and we own 20% of our EMEA and our APAC JV. We have 15 centers that are already operational around the globe.

    What do you think is underappreciated about your business model?

    I think the connectivity of Equinix is underappreciated. We have 270 data centers around the world, so we’re the world’s largest independent data center operator that’s still a public company. People see the physical manifestations of those centers, but the secret sauce is the connections that sit in every single one of those data centers. They take three forms. First is the ability to interconnect a company to another company. We have the trading hubs: 72% of the world’s trading platforms operate on Equinix. You have a trading hub and all their partners located closely to them that need to be literally connected so there’s no latency between the transactions. We have 492,000 deep interconnections between the companies that operate in our centers, between value chains. 

    The second piece of connectivity is to do with the clouds. They are an exceptionally important part of the technology landscape. Many customers store their data in clouds and most customers store their data in more than one cloud. They spread the love. We have a 35% market share in native cloud on ramps from our data centers. So you can pop into the cloud, get your data and bring it back.

    And then the third piece is physically where we’re located. We’re not in the middle of the country. We are in cities, where human beings are with their devices. So many people refer to us as the metro edge, the city edge, the edge where people actually are. So we can connect the cloud, via the metro edge where humans are, to the far edge where devices might be utilized. 

    Do you think people appreciate the role that data centers play in their lives?

    In many countries, we are designated as critical infrastructure, in certain states, too, but not at the federal level. When I think about moving home: water, gas, electricity, internet becomes that fourth utility. And 95% of internet traffic runs through the Equinix environment. If you were on a Zoom call this morning, if you did a stream from any of the major providers, ordered an Uber, purchased a train ticket, you were on a platform accessing Equinix at some point. 

    “95% of internet traffic runs through the Equinix environment.”Adaire Fox-Martin, CEO, Equinix

    What are you seeing in terms of customer trends? 

    Many of our customers are moving from the proof-of-concept phase of AI into the real-world-application phase of AI. There’s a lot to grapple with in that. It isn’t just about taking a business process and putting AI over the top of it. There are a whole series of considerations around governance and the management of data that haven’t really played into the business picture yet that are very real, especially for industries that are highly regulated. 

    That’s why some have not even adopted that much AI. 

    Right. Even if they are frontrunners, now it’s kind of like coming back and saying, ‘oh, how do we make sure that we’re audible, traceable, accountable, all of the things that are good governance for business. If we’re going to deploy a technology that can automate so many things and take my human out of the loop, how do I report, manage, and maintain the governance framework of those processes in my business?

    We’re seeing a lot of pushback in local communities where these mega hyperscale data centers are being built.  How are you staking your claim to say we’re not that, but this is still critical infrastructure we need?

    You look at it through the lens of what are the good things that a data center can do for a local community. We engage very strongly with local communities when we are beginning a construction. You do bring jobs to the area, particularly in the construction face, less so when you’re in the operation face because there isn’t a preponderance of humans across a data center.  Second, you’re obviously going to pay tax in that location and that has knock-on benefit. Thirdly, we employ and source locally. I’m very excited about our apprenticeship scheme, where young women and men who maybe didn’t have a formal education path can become data-center technicians or critical facility engineers. And when there’s a build of a data center, there’s often an upgrade of the infrastructure around it, like whether that’s the power capabilities, the roads and so on. 

    Are people asking more questions about water, energy? 

    For sure. And we recognize that these are extremely important parts of the life system of our planet. We were the first data center operator to begin reporting on our water usage. When you bring in power, you want to maximize the use of that energy in the deployment of workloads for customers and not just empowering the data center itself. We measure our power and how effective we are in using power. The best way to save energy to use less of it. That’s absolutely an industry standard now.

    And water?

    Water was never at the same level of investigation or scrutiny as power was. Now, there’s a measure of water-usage effectiveness and we were one of the first to report on that. It’s not as standardized as power and so we’re working in the industry to try and standardize that a little bit more. 

    In the longer term, data centers will more than likely be cooled by liquid cooling, as opposed to air or evaporative cooling. And liquid cooling, in terms of water use, is a closed-use-loop system. You’re reusing the same water over and over again to cool the chips. The technology itself will become a determinant of sustainability. 

    All the big tech companies are working to make these models smaller and more efficient. Eventually, they’re going to want to have many little data centers that are colocated. Do you think you’ll benefit from that? 

    We believe the inference target addressable market, combined with the network, is about $250 billion outside of what the clouds are doing. By 2029, the inference opportunity will be twice the size of training. And that’s why we’re setting ourselves up for this opportunity. 

    You can think about training as a centralized AI emotion whereas inference is very much a distributed emotion. It will initiate on a device or maybe through voice, or glass, 0r whatever the device is. And it will probably have an agent conduct its orchestra, in terms of instructing other agents to get data from more than one location. That’s why we’ve been very selective about where we built. 

    You came to this job from Google almost a year and a half ago. Where are you now versus what you were thinking when you came in? 

    I would say on a journey, not at the destination but heading in the right direction. I’m confident that we have such a unique combination of characteristics—the metro locations, the connectivity, the secret sauce—that we’re ready for prime time. I’m working through the dynamics of some of the negative feelings around data centers. The challenge around energy has been very real in Europe, in particular. There are countries that have just issued a moratorium on data-center builds, like Ireland, my home country, until they can kind of take a breath and understand whether they can do. These problems are absolutely addressable. They’re absolutely surmountable. It’s a time-based issue that’s going to require collaboration and innovation to solve. 

    What about the regulatory environment? That’s been in flux.

    There is a lot of noise on a variety of topics. I’m just working to control the controllable, and carry on the path that we believe for us is the right path. For example, Equinix has some goals around our sustainability narrative. By 2030, we set a goal for ourselves that we would be neutral as it relates to the use of carbon. We’re still on that track. And we’ve set a science-based goal for 2040 to be net zero and we will continue to innovate and work to do that. 

    It’s not just that we believe there is an opportunity for technology and innovation to exist with good environmental stewardship. Our customers are continuing to ask us for reports on how their usage at Equinix is impacting things that we may be measure.

    There’s a lot of what about AI. What will it do? But there’s a where about AI. And we’re like the where of AI. There are physical cables, even under the ocean, and cable trays and billions of wires. If you’re in California, you get to see the history of data centers. The internet will literally be above your head. We have three decades of data center history, from our very first one to our latest one. I never thought I would come into a company where we have 56 active construction projects all around the world.

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