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    Nvidia $279 billion wipeout — the biggest in U.S. history — drags down global chip stocks

    Global semiconductor and associated stocks fell on Wednesday, following a steep plunge in Nvidia’s share price in the U.S. overnight.
    On Tuesday, around $279 billion of value was wiped off of Nvidia. That was the biggest one-day market capitalization drop for a U.S. stock in history.
    Nvidia shares continued sliding in post-market trading Tuesday, falling 2%, after Bloomberg reported that the company received a subpoena from the Department of Justice as part of an antitrust investigation.

    People walk past the logo of Samsung Electronics in Seoul on July 7, 2022. South Korea’s Samsung Electronics Co Ltd turned in its best April-June profit since 2018 on Thursday, underpinned by strong sales of memory chips to server customers even as demand from inflation-hit smartphone makers cools.
    Jung Yeon-je | Afp | Getty Images

    Global semiconductor and associated stocks fell on Wednesday, following a steep plunge in Nvidia’s share price in the U.S. overnight.
    In the U.S., chipmaker Nvidia plunged more than 9% in regular trading, leading semiconductor stocks lower amid a sell-off on Wall Street. Economic data published Tuesday resurfaced jitters about the health of the U.S. economy. Nvidia shares continued sliding in post-market trading Tuesday, falling 2%, after Bloomberg reported that the company received a subpoena from the Department of Justice as part of an antitrust investigation.

    Around $279 billion of value was wiped off of Nvidia on Tuesday, in the biggest one-day market capitalization drop for a U.S. stock in history. The previous record was held by Facebook-parent Meta, which suffered a $232 billion fall in value in a day in February 2022.
    Nvidia’s value chain extends to South Korea, namely, memory chip maker SK Hynix and conglomerate Samsung Electronics.

    Samsung shares closed 3.45% lower, while SK Hynix, which provides high bandwidth memory chips to Nvidia, slid 8%.
    Tokyo Electron dropped 8.5%, while semiconductor testing equipment supplier Advantest shed nearly 8%.
    Japanese investment holding company SoftBank Group, which owns a stake in chip designer Arm, fell 7.7%.

    Contract chip manufacturer Taiwan Semiconductor Manufacturing Company declined more than 5%. TSMC manufactures Nvidia’s high-performance graphics processing units which power large language models — machine learning programs that can recognize and generate text.
    Taiwan’s Hon Hai Precision Industry — known internationally as Foxconn — lost nearly 3%. It has a strategic partnership with Nvidia.
    The selling in Asia filtered through to European semiconductor stocks. Shares of ASML, which makes critical equipment to manufacture advanced chips, fell 5% in early trade. Other European names such as ASMI, Be Semiconductor and Infineon, were all lower.
    —CNBC’s Lim Hui Jie contributed to this report. More

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    Robinhood lets Brits lend shares for extra income in bid to grow international footprint

    Stock trading app Robinhood on Wednesday launched a new feature in the U.K. allowing retail traders to lend out any stocks they own outright in their portfolio to interested borrowers.
    Shares lent out via the Robinhood app will be treated as collateral, with Robinhood receiving interest from borrowers and paying it out monthly to lenders.
    Share lending is risky — not least due to the prospect that a borrower may end up defaulting on their obligation and be unable to return the value of the share to the lender.

    In this photo illustration, the Robinhood Markets Inc. website is shown on a computer on June 06, 2024 in Chicago, Illinois. 
    Scott Olson | Getty Images

    Online brokerage platform Robinhood on Wednesday launched a share lending program in the U.K. that would allow consumers there to earn passive income on stocks they own, in the company’s latest bid to grow market share abroad.
    The stock trading app, which launched in the U.K. last November after two previous attempts to enter the market, said that its new feature would enable retail investors in the U.K. to lend out any stocks they own outright in their portfolio to interested borrowers.

    You can think of stock lending like “renting” out your stocks for extra cash. It’s when you allow another party — typically a financial institution — to temporarily borrow stocks that you already own. In return, you get paid a monthly fee.
    Institutions typically borrow stocks for trading activities, like settlements, short selling and hedging risks. The lender still retains ownership over their shares and can sell them anytime they want. And, when they do sell, they still realize any gains or losses on the stock.
    In Robinhood’s case, shares lent out via the app are treated as collateral, with Robinhood receiving interest from borrowers and paying it out monthly to lenders. Customers can also earn cash owed on company dividend payments — typically from the person borrowing the stock, rather than the company issuing a dividend.
    Customers are able to sell lent stock at any time and withdraw proceeds from sales once the trades settle, Robinhood said. It is not guaranteed stocks lent out via its lending program will always be matched to an individual borrower, however.
    “Stock Lending is another innovative way for our customers in the UK to put their investments to work and earn passive income,” Jordan Sinclair,  president of Robinhood U.K., said in a statement Wednesday.

    “We’re excited to continue to give retail customers greater access to the financial system, with the product now available in our intuitive mobile app.”

    Niche product

    Share lending isn’t unheard of in the U.K. — but it is rare.
    Several firms offer securities lending programs, including BlackRock, Interactive Brokers, Trading 212, and Freetrade, which debuted its stock lending program just last week.
    Most companies that offer such programs in the U.K. pass on 50% of the interest to clients. That is higher than the 15% Robinhood is offering to lenders on its platform.
    Share lending is risky — not least due to the prospect that a borrower may end up defaulting on their obligation and be unable to return the value of the share to the lender.
    But Robinhood says on its lander page for stock lending that it aims to hold cash “equal to a minimum of 100% of the value of your loaned stocks at a third-party bank,” meaning that customers should be covered if either Robinhood or the institution borrowing the shares suddenly couldn’t return them.
    Robinhood keeps cash collateral in a trust account with Wilmington Trust, National Association, through JP Morgan Chase & Co acting as custodian, a spokesperson for the firm told CNBC.
    Simon Taylor, head of strategy at fintech firm Sardine.ai, said that the risk to users of Robinhood’s share lending program will be “quite low” given the U.S. firm is behind the risk management and selecting which individuals and institutions get to borrow customer shares.

    “I doubt the consumer understands the product but then they don’t have to,” Taylor told CNBC via email.
    “It’s a case of, push this button to also make an additional 5% from the stock that was sitting there anyway. Feels like a no brainer.”
    “It’s also the kind of thing that’s common in big finance but just not available to the mainstream,” he added.
    The new product offering might be a test for Robinhood when it comes to gauging how open local regulators are to accepting new product innovations.
    Financial regulators in the U.K. are strict when it comes to investment products, requiring firms to provide ample information to clients to ensure they’re properly informed about the risk attached to the products they’re buying and trading activities they’re practicing.
    Under Britain’s Financial Conduct Authority’s consumer duty rules, firms must be open and honest, avoid causing foreseeable harm, and support investors’ ability to pursue their financial goals, according to guidance published on the FCA website in July last year.
    Still, the move is also a chance for Robinhood to try to build out its presence in the U.K. market, which —apart from a select number of European Union countries — is its only major international market outside of the U.S.
    It comes as domestic U.K. trading firms have faced difficulties over the years. Hargreaves Lansdown, for example, last month agreed a £5.4 billion ($7.1 billion) acquisition by a group of investors including CVC Group.
    The company has been battling issues including regulatory changes, new entrants into the market, including Revolut, and the expectation of falling interest rates.
    Unlike Robinhood, which doesn’t charge commission fees, Hargreaves Lansdown charges a variety of different fees for consumers buying and selling shares on its platform. More

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    Steph Curry says he wants to be an NBA owner in the future

    Tune in to CNBC all day on Sept. 5 for coverage of the Official 2024 NFL Team Valuations

    NBA sharpshooter Steph Curry said he would like to own an NBA team one day.
    The four-time NBA champion just signed a new contract with the Golden State Warriors through 2027.
    Curry told CNBC he’s learned many lessons from the Golden State Warriors’ owners.

    Four-time NBA Champion Steph Curry is already planning for life after basketball.
    The 10-time NBA All-Star spoke to CNBC’s “Squawk on the Street” on Tuesday about the rest of his basketball career, his various businesses and goals for after his playing career ends.

    The 36-year-old Curry has a media company, Unanimous Media, and a youth golf tour, Underrated, among other ventures. He told CNBC he is also interested in NBA team ownership one day.
    “For me, that’s definitely on the table,” said Curry. “I think I could do a pretty good job of helping sustain how great the the NBA is right now and what it takes to run a championship organization.”
    The star shooter just inked a one-year, $62.6 million contract extension that keeps him playing for the Golden State Warriors through 2027. That contract will expire when Curry is 39 — and the guard who led the U.S. men’s basketball team to an Olympic gold medal in Paris last month said he still has a lot of NBA basketball ahead of him.
    “I know I have a lot more to accomplish on the court before I move into other roles in the league,” he said.

    Stephen Curry #30 of the Golden State Warriors drives to the basket in the second quarter against Dyson Daniels #11 of the New Orleans Pelicans at Chase Center on April 12, 2024 in San Francisco, California. 
    Kavin Mistry | Getty Images

    Curry said seeing former NBA superstar Michael Jordan’s past ownership of the Charlotte Hornets, and the possibility that the league could expand in a couple years, piqued his interest in ownership.

    NBA Commissioner Adam Silver said in July that the league will look at expansion after its media deal was completed. The league inked a new 11-year agreement worth about $77 billion in July. The deal starts after the upcoming season.
    Curry’s longtime rival and Olympic teammate LeBron James has also expressed interest in team ownership, specifically if Las Vegas is awarded a franchise.
    Curry said he’s gotten a first-hand look at how to run a world-class organization, saying Golden State Warriors owners Joe Lacob and Peter Guber have set a standard for how to treat players.
    “The investment that it takes to create that first-class experience so we feel taken care of allows us to hoop at a high level,” he said. More

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    NFL season expected to spur record $35 billion in legal sports wagers

    Tune in to CNBC all day on Sept. 5 for coverage of the Official 2024 NFL Team Valuations

    The American Gaming Association expects $35 billion to be legally wagered this NFL season, a fresh record.
    That would mark more than 30% growth over the $26.7 billion Americans wagered over the course of last year’s season of the National Football League, according to the AGA.
    Licensed sportsbooks like DraftKings, FanDuel and ESPN Bet are working to claim a bigger share of the action.

    Joe Milton III #19 of the New England Patriots scrambles from the pressure of Kyu Blu Kelly #36 of the Washington Commanders during the third quarter of a preseason game at Commanders Field on August 25, 2024 in Landover, Maryland.
    Scott Taetsch | Getty Images Sport | Getty Images

    Football is back, and it’s expected to bring with it record-breaking betting.
    U.S. adults will wager $35 billion this NFL season, according to projections from the American Gaming Association.

    That would mark more than 30% growth over the $26.7 billion Americans wagered over the course of last year’s season of the National Football League, according to the AGA, and would set a fresh record. Since last NFL season, Maine, North Carolina and Vermont have allowed sports betting operators to launch in their states. And court decisions have permitted Hard Rock International to relaunch sports betting in Florida.
    Today, sports betting is live and legal in 38 states and Washington, D.C.
    And yet stocks in the gambling companies aren’t following the same growth trajectory. Shares of DraftKings, Penn, Caesars, MGM Resorts and Entain, which jointly own BetMGM, are all negative year to date. Flutter, owner of FanDuel, is up 19%, after listing on the New York Stock Exchange this year. It posted second-quarter earnings that trounced expectations for revenue and profit, giving shares a lift.
    Churchill Downs is positive on the year and Rush Street Interactive has posted notable gains of 109% year to date.

    Competition heating up

    Each of the licensed sportsbooks is working on strategies to claim a bigger share of the action, trying to attract new customers and convince established players to show more brand loyalty.

    NFL kickoff is an opportunity to launch new and improved technology or innovative wagers that entice players. Sportsbooks tailor their promotions to reach new customers.
    “The NFL season is our biggest acquisition period of the year,” said Christian Genetski, president of FanDuel, the nation’s leading sportsbook.
    FanDuel is the only one to partner with YouTube to roll out a “Sunday Ticket” offer. Players who wager $5 get a three-week trial to watch out-of-market NFL games with “Sunday Ticket.” FanDuel hopes allowing fans to watch their favorite teams will lead to more wagering.
    FanDuel also said it has tweaked its app design and added more bets to its Same Game Parlay. It’s upgraded features so fans can wager at “the speed of sports,” the company said.
    With more than 95% of sports wagers now happening online, speed matters. That’s especially true when it comes to micro-betting: wagers made on specific plays as the game unfolds.
    Fanatics, Michael Rubin’s e-commerce empire that includes sports merchandise and memorabilia, launched its sportsbook last year in four markets. Since then, Fanatics Sportsbook acquired PointsBet’s U.S. operations and technology, which is now fully integrated. And its sportsbook is now live in 22 states.
    It’s a pretty impressive ramp for a newcomer to the industry.

    Pavlo Gonchar | Lightrocket | Getty Images

    Fanatics Sportsbook relies on the existing database of 100 million sports fans for customer acquisition throughout the year and rewards them with products from the merchandise and collectibles businesses.
    And just before the start of the 2024 football season, Fanatics hosted a blockbuster fan activation called Fanatics Fest NYC where customers could meet athletes and celebrities and celebrate their passion for sports.
    Fanatics Sportsbook CEO Matt King told CNBC the customer response was effusive.
    “We’ve seen incredible positive sentiment and resonance with our proposition of being the most rewarding sportsbook, both in terms of the economic value of what we give back as well as, frankly, the unique things we can do,” King said.
    King said unique player rewards build into the crescendo of the sports calendar, what he described as the “sports equinox” — that time during the fall when nearly every sport is being played on overlapping schedules.
    DraftKings said the NFL is its most popular league by both handle and number of bets it accepts.
    The sportsbook, which recently pulled back on a plan to tax customers in high-tax states, is offering a “No Touchdown” prop bet this season, meaning bettors will now be able to wager on whether a top player does not score a touchdown.

    New offerings

    With its shares off 28% this year and its digital business in the red, there is a spotlight and scrutiny on Penn Entertainment. This is its first full NFL season to show off ESPN Bet, its $2 billion investment on a rebranded sportsbook in partnership with the Disney-owned sports juggernaut. It first launched in November last year, smack in the middle of NFL season.
    Since then, the platform has grown its customer database to 31 million members, an 80% gain. Penn’s leaders are optimistic about its media integration with ESPN.
    “People are active in our app, and our goal over the next several quarters is to drive higher loyalty and retention and better monetize the significant engagement activity through improved product and expanded offerings,” Penn CEO Jay Snowden said on an Aug. 8 earnings call.

    The ESPN Bet app on a smartphone arranged in New York, US, on Thursday, Feb. 22, 2024. 
    Gabby Jones | Bloomberg | Getty Images

    BetMGM just launched the first single wallet for mobile play in Nevada, where customers can transport their accounts from Las Vegas back to their home states. Mobile wallets eliminate the friction of multiple transactions.
    “Our players can now immerse themselves in the excitement of MGM Resorts’ Las Vegas destinations or statewide while seamlessly continuing to place wagers in other BetMGM markets,” BetMGM CEO Adam Greenblatt said in a statement.
    Tune in: CNBC reveals the Official 2024 NFL Team Valuations Thursday, Sept. 5 on air and online. More

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    Soaring sports team values create new pressure for owners on taxes, succession

    Professional sports owners and leagues are increasingly focused on how to insure smooth ownership transitions.
    Succession and taxes have become especially important in the National Football League, where the average age of team owners is now over 72 and team values are all surging.
    CNBC’s Official 2024 NFL Team Valuations list, ranking all 32 professional franchises, will be released Thursday.

    A detail view of a NFL shield logo paint of the field during a preseason game between the Los Angeles Rams and the Houston Texans at NRG Stadium on August 24, 2024 in Houston, Texas.
    Ric Tapia | Getty Images Sport | Getty Images

    Sports team owners benefiting from soaring team values are also facing new pressure from two of the oldest certainties in American wealth: death and taxes.
    With the average age of team owners rising, and team values skyrocketing into the billions, owners and leagues are increasingly focused on how to insure smooth ownership transitions to the next generation of buyers. While today’s owners have highly sophisticated tax and succession plans, even the best plans can blow up over family disputes or unexpected tax changes.

    “The people who bought sports teams a long time ago have now found that a large portion, if not a vast majority, of their long-term estate is now the value of the team,” said Stephen Amdur, co-leader of mergers and acquisitions and private equity practices at Pillsbury Winthrop Shaw Pittman, who advises many billionaire team owners. “They’re thinking a lot about who is going to hold it for the next generation and what they’re going to do with it.”
    Succession and taxes have become especially important in the National Football League, where the average age of team owners is now over 72 and team values are all surging. CNBC’s Official 2024 NFL Team Valuations list, ranking all 32 professional franchises, will be released Thursday.
    NFL owners face one of two painful choices: They can sell the team while they’re alive, which can create massive capital gains tax bills, or they can pass the team to their families, which can trigger estate taxes or prolonged family battles for control.
    Former Denver Broncos owner Pat Bowlen created a detailed succession and tax plan for the team a decade before his death in 2019. Yet a bitter dispute among family members, both before and after he died, led the team to be sold in 2022 to Walmart heir Rob Walton for $4.65 billion.

    Then-owner Bud Adams of the Tennessee Titans signs autographs during a preseason game against the Minnesota Vikings at LP Field on August 13, 2011 in Nashville, Tennessee.
    Grant Halverson | Getty Images

    Tennessee Titans founder Bud Adams, who died in October 2013, had divided ownership of the team among three branches of his family, which he thought would keep the peace. Instead, the split created a highly public battle over control, leading to an eventual deal within the family. Amy Adams Strunk, Bud’s daughter, is now controlling owner of the team.

    Longtime New Orleans Saints owner Tom Benson touched off years of litigation when he removed his daughter and two grandchildren from his estate and passed ownership of the NFL team and the National Basketball Association’s New Orleans Pelicans to his wife Gayle when he died in 2018. She still maintains control of the Saints.

    Then-New Orleans Saints owner Tom Benson and his wife Gayle before a game at the Mercedes-Benz Superdome on August 26, 2016 in New Orleans, Louisiana.
    Jonathan Bachman | Getty Images

    And perhaps the most poignant cautionary tale in the NFL is the legendary Miami Dolphins owner Joe Robbie, who left the team to his wife and nine children at the time of his death in 1990. A family feud and estate taxes of more than $45 million forced the family to sell a majority of the team in 1994.
    Under current U.S. tax law, estates over $13.6 million for individuals or $27.2 million for couples are subject to a tax of 40%. Since teams in the NFL and NBA are now worth billions, all team owners could potentially be subject to hundreds of millions of dollars in taxes without proper planning. 
    Another wrinkle: It’s unclear whether the estate tax rates would change in 2025, when the current levels are set to expire. So owners have to be planning for the potential for more punitive estate taxes in the coming years.
    Trust and estate attorneys say today’s team owners have a much broader array of tools at their disposal to minimize the tax impact of succession. One of the most popular is the family limited partnership, which makes family members minority stakeholders and leaves the primary owner, as the general partner, with control. By dividing up ownership, the partnership can lower the value of assets (and therefore of the taxable estate) of the general partner.
    Owners can also split ownership among family members through individual trusts, as Chicago Bears owner George “Papa Bear” Halas Sr. did with his 13 grandchildren. They can also transfer an interest in the team into an irrevocable trust through a partnership or an LLC.

    Chicago Bears coach George Halas watches his team play the Los Angeles Rams in the Coliseum on Nov. 2, 1958.
    Bettmann | Getty Images

    “Owners are spending more time on the front end thinking about long-term estate planning to ensure as tax-efficient an outcome as possible,” Amdur said.
    That’s assuming the team stays in the family, of course. While owners often hope to pass their passion and financial commitment to a team on to their children, the next generations often have different interests or financial goals, which could mean offloading some team ownership.
    And there’s now a fresh pool of prospective buyers.
    The NFL last week voted to allow select private equity firms to buy minority stakes in teams, giving owners and their families a chance to draw down cash that they could then reinvest in their teams or invest in nonsports assets to better diversify – all while keeping control.
    “I think it’s an appropriate thing to give the teams that liquidity to reinvest in the game and to their teams,” NFL Commissioner Roger Goodell said in making the announcement. More

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    Tesla Cybertruck is in a category of its own for better or worse

    Tesla’s Cybertruck is not a direct competitor for electric trucks from traditional automakers — and in many ways it’s not a “truck” at all.
    The $100,000 futuristic vehicle is an experiment for the company regarding its technologies, including a new electrical architecture and steering system.
    Like the Ford Ranchero and Chevrolet El Camino before it, the Cybertruck has created a new segment in the automotive industry that it solely holds.

    A Tesla Cybertruck in front of a graffiti mural on Aug. 28, 2024 in Detroit.
    Michael Wayland / CNBC

    DETROIT – Spaceship. Dream car. UFO. Dumpster. Cool. Stupid. Phenomenal. Abomination.
    Those were all words used to describe the Tesla Cybertruck during a 24-hour rental of the vehicle in metropolitan Detroit. They were expressed by strangers, friends, family, and auto industry experts and employees.

    A word not used much? “Truck.”
    That’s because the Tesla Cybertruck is far more “cyber” than “truck.” It indeed has some truck capabilities, such as a pickup bed and other utilitarian features, but it is not a truck in any traditional sense of the word.
    It is a unique product that only comes along every so often. Similar to the first SUV, minivan or “roadster pickups” such as the Ford Ranchero and Chevrolet El Camino, it has created a new segment in the automotive industry that it solely holds.
    That’s good and bad for both Tesla and its competitors, specifically the truck-reliant automakers from Detroit that have spent decades refining their trucks to meet the needs of their customers. That includes things such as bed access and door handle sizes to seating height and interior components.
    The Cybertruck is not a direct competitor for electric trucks from traditional automakers. The Cybertruck is a “truck” for Tesla fans/owners and an experiment for the company in many ways regarding its technologies, including a new electrical architecture and steering system.

    Fronts of the Ford F-150 Lightning, Tesla Cybertruck and GMC Sierra Denali EVs (left to right).
    Michael Wayland / CNBC

    The top vehicles that are cross-shopped for the Cybertruck are Tesla’s other four models, followed by the Ford F-150 Lightning in a distant fifth at 7.4% of potential buyers, according to Edmunds.com.
    I drove a roughly $100,000 all-wheel-drive version of the Cybertruck in regular driving conditions and traffic in Detroit and its surrounding suburbs, including a short torrential downpour in which the vehicle’s comically large wiper blade performed fine.
    I did not test the vehicle’s towing or hauling capabilities, which have come into question recently following reports of problems involving the durability of the vehicle’s aluminum frame. Most notably, in an over-the-top viral video from YouTube channel WhistlinDiesel.
    I wanted to have better first-hand knowledge of the vehicle and compare it with electric trucks from other automakers, but that was harder than initially expected. I also purposely did not watch or read any reviews ahead of time about the vehicle before driving it.

    Driving the Cybertruck

    The Cybertruck is unlike any other vehicle I’ve ever driven. That includes every all-electric truck on sale today from General Motors, Ford Motor and Rivian Automotive.
    The only vehicle to come close to a similar driving experience is GM’s Hummer EV. Both are large, gaudy and outlandish vehicles that are more infamous than they are practical. But the Hummer EV still feels like a truck in its driving dynamics, seating and overall functionality. The Cybertruck does not.

    A Tesla Cybertruck near General Motors’ Renaissance Center world headquarters in Detroit.
    Michael Wayland / CNBC

    The Cybertruck features tight steering, including a yoke and “steer-by-wire” system; a stiff chassis similar to a sports car; and, while arbitrary, a design that is far more form than function, which is historically one of the top reasons to purchase a pickup truck.
    The seating also feels far more like a car than a truck. Even when the vehicle is at its “high” setting, which it can only be in under 25 mph, it’s still several inches lower than most electric trucks.
    That’s not to say it isn’t “tough.” As seen on YouTube, the company and owners have shot bullets at it, thrown steel balls at its windows and done other less-than-industry-standard tests. Having said that, the vehicle I drove had just more than 2,000 miles on it and I found two pieces of trim peeling off along the rolling bed cover’s sealant/guide rails.
    Potential problems with the durability of the frame are concerning. It is the base of the vehicle that everything is built on. For a vehicle’s frame to break, even in severe testing conditions, is a serious problem.
    Regarding its polarizing design, it’s on another level of its own. It makes GMC’s Hummer seem normal. Heads turned, jaws dropped and there were even a few people yelling or screaming, including one fellow driver aggressively giving me a thumbs down as I passed (some Cybertruck drivers have reported more explicit gestures). The reactions came from toddlers and school children to construction workers and police officers.

    Interior

    Inside the doorstop-shaped, stainless-steel alloy exoskeleton of the Cybertruck is where things get more interesting.
    The interior of the vehicle, like its other Tesla siblings, is described by many as “minimalistic.” I’d call it sparse and, in some material choices, cheap for a $100,000 vehicle. Given its size, the interior of the vehicle also feels more like a car than a “truck.”

    Interior of a Tesla Cybertruck
    Michael Wayland / CNBC

    There’s about 3½ feet of unusable space from the driver to the bottom of the vehicle’s windshield, while the back seat is fine for a car but a little lacking for space compared with today’s full-size pickup trucks.
    The centerpiece of the vehicle’s interior is a large 18.5-inch, center-mounted touchscreen and minimal controls on the steering wheel, or yoke.
    What the Tesla Cybertruck lacks in “truck-ness” and interior qualities, it arguably makes up for in technology, as well as the human-machine interface, or HMI, of the vehicle with the driver.
    That includes the gear shifter being a long rectangle in the top left of the screen for drive, park and reverse. It functioned well and I did not miss having to use a traditional shifter, although there are such buttons hidden in the vehicle’s roof, above the screen.

    The “shifter” on the Tesla Cybertruck is the long rectangle on the left of the vehicle’s center control screen.
    Michael Wayland / CNBC

    The processing speed of the infotainment system is impressive, especially when compared with other non-Tesla EVs from traditional automakers. It’s also very manageable, despite the amount of information displayed on the screen.
    I’d still prefer a screen in front of the driver or a heads-up display for speed and other rudimentary information projected on the vehicle’s windshield but it didn’t bother or distract me as much as I thought it would.
    The vehicle’s mirrors also were largely unusable, and likely only there to meet federal safety standard requirements. The Cybertruck’s camera system, which functions in lieu of useful mirrors, took a little getting used to but worked just fine (several automakers have usable mirrors along with such camera systems that show the rear and sides of the vehicle).

    Tech focused

    I was able to use the vehicle’s adaptive cruise control system, which Tesla infamously calls Autopilot, but not more advanced systems such as “FSD,” which Cybertruck customers can order but isn’t yet available.
    The system’s ability to spot and display other vehicles, streetlights, people and even traffic cones, stop signs and garbage cans on the screen was impressive, but it was nothing more than a standard adaptive cruise control when driving. It also stopped at every traffic light whether it was green, yellow or red.
    Another surprising feature was the yoke replacing a traditional steering wheel. Again, this is a feature more popular with race cars than pickup trucks, but it functioned well. It does not rotate fully, instead going about 180 degrees or so for a full turn. Input needed is minimal when changing lanes. The ease also comes from the vehicle’s four-wheel steering and steer-by-wire system.

    The Tesla Cybertruck is unveiled at Tesla’s design studio on Nov. 21, 2019, in Hawthorne, Calif. 

    Both steering features are emerging technologies being used or looked into by other automakers.
    The four-wheel steer makes it so a large vehicle such as the Cybertruck or GMC Hummer, which also features it on its rear wheels, can turn more tightly than a traditional truck. It’s more similar to the turn radius of a car, which helps maneuver the vehicle into tighter places and parking spots.
    The steer-by-wire is harder to describe. The system uses electronics and software to control a vehicle’s steering without a mechanical connection between the steering wheel and the wheels. It feels almost like a racing yoke for a video game or aircraft rather than a traditional vehicle.
    “You can make it perform much differently. … It gives you much more of a performance bandwidth,” said Terry Woychowski, president of automotive at engineering consulting firm Caresoft Global.

    A Tesla Cybertruck next to a GMC Hummer EV SUV.
    Michael Wayland / CNBC

    Woychowski, a former GM executive whose company has tested and benchmarked the Cybertruck, said the steer-by-wire feature is “discretionary.” But he described the change in the vehicle’s electrical architecture that powers all of its systems as “bare bones, engineering efficiency” that has been a needed change for years.
    The Cybertruck features a 48-volt architecture to power the components of the vehicle. Doing so allows for additional electrical bandwidth for a vehicle and eliminates the need for a traditional 12-volt battery to power things such as windows, seats and headlights.
    Tesla is the first to offer such a 48-volt system on a pure EV. Tesla CEO Elon Musk infamously sent competitors such as Ford and GM essentially a “how-to” guide on developing such a system.
    The benefit with using the higher voltage for auxiliary devices is that the same power can be supplied at a lower current. It can save weight and cost as the wiring is about half the size.

    A Tesla Cybertruck in front of a graffiti mural on Aug. 28, 2024 in Detroit. 
    Michael Wayland / CNBC

    However, the system requires a complete rethinking of a vehicle’s electrical architecture that can be costly. Whether or not other automakers follow Tesla is yet to be seen.
    “The bill to make the change is huge,” Woychowski said. “It really is very, very good technology to bring in. It’s long overdue. There is a direct savings from a cost and mass perspective, and for an EV that is gold.”
    It’s apparent that the vehicle appeals to a sector of Americans who have the means to afford it … likely along with several other vehicles. It was the top-selling electric “truck” during the second quarter of this year, edging out the segment-leading Ford F-150 Lightning, Rivian R1T and GM’s Hummer EV and Chevy Silverado EV.
    But how much appeal such a polarizing vehicle has in the long term will be determined in the coming quarters and years ahead. The Chevy El Camino and Ford Ranchero were able to last a couple decades. More

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    Klarna rival Zilch posts first profit and appoints ex-Aviva CEO to board ahead of IPO

    Zilch said Tuesday that it made an operating profit in July 2024, hitting profitability faster than other major consumer fintechs that have also managed to break even.
    The company also said it topped £100 million ($130 million) in annual revenue run rate, doubling from the run rate it reported last year.
    Philip Belamant, Zilch’s CEO, told CNBC the firm was able to hit profitability by growing rather than cutting back like other fintechs have done.

    Zilch CEO Phil Belamant.

    British financial technology firm Zilch on Tuesday reported its first-ever month of profit, marking a key milestone for the company as it looks toward an eventual initial public offering.
    In a trading update, Zilch, which competes with the likes of Klarna and Block in the buy now, pay later space, said that it made an operating profit in July 2024, hitting profitability within four years of its founding date — faster than other major consumer fintechs that have also managed to break even.

    Competitors Starling and Monzo, meanwhile, took more than three and four years to make their first profit, respectively. Others have managed to hit profitability faster. Digital banking startup Revolut, for example, broke even for the first time just two years after its launch.
    Zilch also said it topped £100 million ($130 million) in annual revenue run rate, doubling from the run rate it reported last year.
    Philip Belamant, Zilch’s CEO and co-founder, told CNBC Tuesday that, despite the current high-interest rate environment, the firm was able to hit profitability by growing its business rather than cutting back like other fintechs have done.

    “If you think of the last two and a half, three years, a lot of VC-backed companies, especially high growth fintech businesses have had to cut their way to get to profitability. And some of those have actually cut so far they went bust along the way,” Belamant told CNBC’s “Squawk Box Europe.”
    “It’s not been easy. And, for Zilch, we took a different approach. We looked at this and said let’s grow our way to profitability,” Belamant added.

    Separately Tuesday, Zilch announced the appointment of former Aviva CEO Mark Wilson to its board. Wilson, who was made a non-executive director, said he was “excited” to join the firm at a critical juncture and “further help Zilch steer its path toward sustainable success as a category leader.”
    Zilch’s CEO Belamant told CNBC in June that he wants to list the business publicly in the next 12 to 24 months. That same month, the company announced that it had raised $125 million of initial debt financing from Deutsche Bank.
    That deal, which gives Zilch the option to draw down up to $315 million of credit from both Deutsche Bank and other banks, is expected to help the company triple its overall sales volumes in the next couple of years, according to the firm.
    Klarna, which Zilch competes with in the U.K., is also planning a stock market flotation in the medium term, with its CEO Sebastian Siemiatkowski having previously told CNBC it wouldn’t be “impossible” for the firm to list as soon as this year. More

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    China’s property woes and U.S. sanctions have hit some cities hard

    China’s property struggles and U.S. sanctions have significantly affected some of its cities, even as others benefit from Beijing’s tech push, Milken Institute’s best performing cities China index showed Tuesday.
    Hangzhou, capital of the eastern Zhejiang province and home to Alibaba and other tech companies, ranked first in this year’s rankings.
    Other cities, such as Zhuhai, once a “rising star,” dropped in the rankings due to the slump in real estate.

    HANGZHOU, CHINA – SEPTEMBER 1, 2024 – Photo taken on Sept 1, 2024 shows a newly built building of China Vanke in Hangzhou, Zhejiang province, China. 
    Cfoto | Future Publishing | Getty Images

    BEIJING — China’s property struggles and U.S. sanctions have significantly affected some of its cities, even as others benefit from Beijing’s tech push, Milken Institute’s best performing cities China index showed Tuesday.
    Since 2015, the index has studied China’s large- and mid-sized cities for their economic vibrancy and growth prospects. The latest version generally compares data for 2023 with that of 2021. Last year, the institute did not publish a report due to a reassessment of its methodology.

    Hangzhou, capital of the eastern Zhejiang province and home to Alibaba and other tech companies, ranked first in this year’s rankings.
    While other cities, such as Zhuhai, once a “rising star,” dropped in the rankings due to the slump in real estate.
    The city, in the southern province of Guangdong near Hong Kong, fell 32 places from the previous index published in 2022 to 157th place. Suddenly no one bought houses.
    “Builders didn’t have much money to complete their projects,” Perry Wong, managing director of research at the institute, told reporters in Mandarin, translated by CNBC.
    Property and related sectors once accounted for more than a quarter of China’s gross domestic product. But in 2020, Chinese authorities started cracking down on real estate developers’ high reliance on debt.

    Wong added that real estate dragged down growth for several of the main cities in that region, except for Dongguan. The city of factories, home to Huawei’s sprawling European-style campus, was instead hit by U.S. sanctions. Dongguan dropped 15 places in the Milken index rankings to 199th place.
    There are 217 cities in the index. While the nearby metropolis of Shenzhen went up in rankings, the city landed in 9th place, behind Beijing. A majority of the Chinese companies initially blacklisted by the U.S. were based in Shenzhen or Beijing, Wong pointed out in an interview with CNBC.
    “Zhuhai is an extremely good place to do service jobs, to do even production jobs, high-end production jobs in biotech,” he said. “So [excluding the real estate impact] it should have a pretty promising future.”
    Another city affected by the geopolitical drag on exports is Zhengzhou, capital of the Henan province and home to iPhone manufacturer Foxconn. Zhengzhou fell to 22nd place, down from 3rd.
    Historically, Wong pointed out, having control of Zhengzhou, Hefei, and Wuhan have been critical to ensuring control of the country.
    From an economic perspective, Hefei, in the Anhui province, and Wuhan, in Central China’s Hubei province, fared better in the latest index.
    Wuhan surged by nearly 30 places to second, while Hefei remained among the top ten. Wong attributed this to Wuhan’s efforts to keep factories running during the pandemic, allowing the city to rebound quickly, while a university in Hefei received direct government support for technological development.
    As for Hangzhou’s success, the institute’s research pointed to the city’s growth as a hub for e-commerce, manufacturing and finance.
    But asked on CNBC’s “Squawk Box Asia” if Hangzhou’s success could be replicated, Wong said it would be difficult, partly due to the outperformance of the local property sector that’s increased living costs. More