Foreword

Alyson Shontell

Editor-in-Chief

Good morning, Nicholas Gordon, Fortune’s Asia editor, filling in for Alyson.

This week’s biggest tech story is Trump’s unprecedented decision to let Nvidia (No. 31 on the Fortune 500) and AMD (No. 167) sell their advanced AI chips to China—in exchange for a 15% cut of their China sales. Trump officials say the move will keep Chinese companies hooked on U.S. products; critics blast it as putting a price on U.S. national security. (Another problem: It may be unconstitutional.)

From my desk in Hong Kong, Trump’s move is something else: a halt to a tech decoupling that’s been building since 2022, when the U.S. first slapped chip controls on China.

What was once a clear (if debatable) argument for export controls—don’t sell China advanced chips, the better to preserve the U.S. lead in AI—looks murkier. As Jennifer Lind, an associate professor at Dartmouth, told me this week, the deal suggests that “what gets banned or permitted is not being driven by careful calculations about the effect on Chinese military power—but rather on political whim and personalist politics. This is ruinous for a functioning export control regime.”

China is trying to develop its own advanced chips—with some limited success. (Treasury Secretary Scott Bessent brought up these concerns Wednesday, warning that he didn’t want “Huawei to have a digital Belt and Road.”) And Chinese AI developers keep impressing outside observers with what they can do with limited resources.

This isn’t just a U.S.-China discussion. The chip supply chain is a global one: The companies that make Nvidia chips—and make the tools that make the Nvidia chips—are based in economies like Taiwan, Japan, South Korea, and the Netherlands, all long-time U.S. allies.

Bessent is already suggesting the Nvidia-AMD deal is a “beta test” for other industries. And the Trump administration is reportedly thinking about taking a stake in U.S. chipmaker Intel (No. 86).

Fortune’s reporters and editors—on both sides of the Pacific—will be watching this space.

—Nicholas Gordon, Asia editor

Deals & Developments

UnitedHealth Group (No. 3) has completed its $3.3 billion all-cash acquisition of home health and hospice provider Amedisys after a lengthy two-year regulatory review and hurdles with the U.S. Department of Justice. The acquisition makes UnitedHealth one of the largest providers of hospice and home health care in the U.S., following its 2023 purchase of LHC Group for $5.4 billion.
AI startup Perplexity made an unsolicited $34.5 billion cash offer to buy the Google Chrome browser from the Alphabet (No. 7) subsidiary. The bid arrives as a federal judge considers whether to force Google to sell Chrome, following a 2024 court ruling that found the company illegally monopolized the search market. Google has not responded publicly to the offer. Perplexity recently launched its own browser, ⁠Comet⁠.
Paramount (No. 147) has secured exclusive U.S. media rights to the UFC in a seven-year, $7.7 billion deal with TKO Group Holdings. Beginning in 2026, all 43 UFC annual live events will stream on Paramount+, with some major events also set to air on CBS. The agreement marks the end of UFC’s pay-per-view model.
Southwest Airlines (No. 156) has agreed to sell its renewable fuels subsidiary, Saffire Renewables, to Kansas-based Conestoga Energy as the airline pivots away from its earlier climate-focused investments. Terms of the deal were not disclosed.
Ecolab (No. 274) announced it will acquire Ovivo’s electronics ultra-pure water business for $1.8 billion in cash. The deal is set to boost Ecolab’s offerings of advanced water systems for semiconductor facilities.

Overheard

“There won’t be a ‘next Google.’”

—Thomas Grange, cofounder and chief innovation officer at AI-search optimization platform Botify, speaking about the future of search engines amid Perplexity’s bid for Google Chrome.

On earnings calls:

Cardinal Health (No. 15) missed Wall Street revenue expectations with $60.2 billion in Q4 revenue, flat from the same quarter last year. During the earnings call, CEO Jason Hollar highlighted strong double-digit profit growth across all segments and announced the company’s $1.9 billion acquisition of Solaris Health to strengthen its specialty care initiatives.
Performance Food Group (No. 80) delivered a revenue beat this week, posting $16.9 billion in Q4 sales, up 11.5% year-over-year and surpassing analyst estimates. During the company’s earnings call, CEO George Holm noted that the company’s board “determined that there was no basis to engage in the information sharing requested by US Foods” after the latter asked Performance Food to explore a potential merger the week prior. (US Foods ranks No. 122 on the Fortune 500.)
Cisco Systems (No. 83) beat Wall Street expectations this week, reporting $14.7 billion in Q4 revenue, up 8% year-over-year. CEO Chuck Robbins emphasized on the company’s earnings call that surging demand for AI infrastructure and over 20 new AI-focused product launches fueled growth across all regions and customer segments.
Deere (No. 89) surprised Wall Street by topping earnings forecasts in Q3, though revenue declined 9% and net income dropped 26% year-over-year amid weaker demand and trade uncertainty. Deere cut its full-year net income guidance to $4.75 billion to $5.25 billion and warned of continued pressure from tariffs and high interest rates.
Applied Materials (No. 158) delivered a record Q3 this week, posting $7.3 billion in revenue, up 8% year-over-year and beating analyst expectations. CEO Gary Dickerson emphasized the company’s momentum in AI-powered semiconductor systems.
Celanese (No. 412) beat analyst expectations for Q2, posting $2.53 billion in revenue, down 4.5% year-over-year. CEO Scott Richardson emphasized aggressive cost action and innovation in electric vehicles during the company’s earnings call, though he acknowledged demand softness in automotive and construction.
QXO (No. 421) delivered a blockbuster Q2 with $1.91 billion in revenue, up more than 13,000% from last year attributable to the company’s acquisition of Beacon Roofing Supply. CEO B