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Volkswagen said it was cutting a key profitability target for the year as it scrambles to contain the fallout from a host of challenges that forced it to significantly downsize its workforce.

The beleaguered German carmaker said Friday that it expected an operating return on sales of up to 1% this year, down from a prior estimate between 4% and 5.5%. The new projection, announced just before market close in Germany, is below analysts’ forecast of 4.1%, sending Volkswagen shares nearly 5.6% lower.

The guidance revision comes weeks after Volkswagen’s supervisory board approved a plan to double job cuts to 100,000, arguing the group has to remain competitive at a time when the auto sector struggles with U.S. tariffs, rising manufacturing costs and stiff competition from Chinese rivals.

Earlier this month, Volkswagen said it was selling its factory in the German city of Osnabrueck to Israel’s Aurelius Capital and the state of Lower Saxony, which aim to repurpose the site to make defense equipment.

The group said restructuring expenses from early retirement packages for some employees as well as the planned sale in Osnabrueck had forced it to revise the outlook.

Long considered a fixture of Germany’s industrial base, Volkswagen has been seeking to revive its fortunes for years now, but challenges keep piling up.

The company said a further deterioration, especially in the Chinese market, as well as a shift in demand for battery-electric vehicles, would weigh on operating earnings, meaning that performance would fall short of original expectations, particularly for the Audi and Volkswagen Passenger Cars brands.

The group also said the revision was due, in part, to a non-cash impairment of goodwill of roughly 6 billion euros, equivalent to $6.89 billion, in relation to Porsche AG, in which Volkswagen commands a stake of more than 75%.

Porsche AG has been grappling with its own challenges, and Volkswagen said the impairment would harm its own operating profit in the third quarter.

The sports-car maker is also moving to lower costs, including cutting 5,000 jobs, as it struggles with a decline in demand from Chinese consumers for high-end imported cars.

Volkswagen said it expected a hit of around 2 billion euros in the second half of the year due to restructuring costs, the deteriorating environment and the impairment.

Revenue for the year should decline to around 315 billion euros from 321.9 billion euros in 2025. It had previously said that sales could be stable or decrease by up to 3%, but the new figure is broadly equivalent to the midpoint of a prior guidance range.

Meanwhile, it said it continued to expect net cash flow at its automotive division between 3 billion euros and 6 billion euros and net liquidity in the segment between 32 billion euros and 34 billion euros.

Volkswagen said its outlook was based on assumption that tariffs would remain unchanged and noted that those estimates didn’t take into account possible future effects from the war in the Middle East.

The company plans to publish its third-quarter report on Oct. 29.

SoftBank Group Corp. is closing out the week with nearly $21 billion in potential fresh borrowings as it builds out its artificial intelligence financing capacity. It’s also looking to raise another $10 billion to $20 billion next week in a separate jumbo bond deal.

The Japanese conglomerate increased its margin loan backed by shares of its chip unit Arm Holdings Plc by $5 billion to $25 billion, people familiar with the matter said on Friday. And it recently secured an additional $450 million to an existing credit line, bringing the total to $6.5 billion, according to people familiar with that deal.

Apollo Global Management Inc. is also in talks to boost the size of a loan to SoftBank by $3.6 billion to $9 billion to help it finance its investment in AI giant OpenAI. On top of that, the firm founded and led by billionaire Masayoshi Son secured an $11.87 billion loan, also to support its OpenAI investment, according to people familiar with those deals.

That flurry of activity translates into committed and potential new debt of $20.92 billion that will finance its push deeper into AI including a $65 billion commitment to OpenAI.

One of the world’s biggest investors in AI, SoftBank is at the epicenter of debates about the future of debt-fueled bets on the sector, at a time when market volatility has increased amid safety warnings.

It’s among tech giants including Oracle Corp. and Meta Platforms Inc. that are pouring unprecedented amounts of capital into AI technologies and infrastructure. But some investors are getting increasingly worried about the surge in Son’s multibillion-dollar AI projects where the revenue payoff is largely uncertain.

In its margin loan backed by shares of Arm, the Japanese firm renegotiated the terms and signed a deal with creditors this month, said the people, who asked not to be identified discussing private information.

It’s the third time SoftBank is upsizing its margin loan using Arm shares as Son needs billions of dollars to fund his growing AI investments.

The margin loan — where a borrower uses investments like stocks as collateral — began as an $8.5 billion facility in 2023. It was subsequently increased to $13.5 billion in 2024 and then to $20 billion last year.

As of May, SoftBank’s loan was secured by 769 million shares of Arm, representing a 72% stake in the chip designer, according to company filings. SoftBank owns almost 90% of Arm.

SoftBank had drawn $20 billion from the facility as of December, with the loan set to expire in September 2027. The loan remains priced at an interest margin of about 225 basis points over the benchmark Secured Overnight Financing Rate and a credit adjustment spread of 25 basis points, some of the people said.

The deal drew strong demand, helped by the 142% spike in Arm’s share price this year. SoftBank was initially looking to increase the facility by $3 billion to $5 billion, but received about $7 billion in demand from lenders, the people said. SoftBank could boost the loan further if Arm shares continue to rise, they added.

In its upsized credit line to $6.5 billion, there are currently more than 20 banks involved, according to people familiar with that deal. It carries an interest margin of 210 basis points over the benchmark Secured Overnight Financing Rate, they added.

SoftBank declined to comment on the increase in the margin loan backed by Arm shares and on the expanded credit line.

The company has also been meeting with fixed-income investors in New York this week to test appetite for a possible junk bond offering that could total $10 billion to $20 billion, people familiar with those discussions have said. A deal could come to the market as early as next week, according to other people briefed on the matter.

“We have investor meetings to provide an update in New York on a non-deal basis. Nothing has been determined on bond issuance,” SoftBank said when asked about the meeting.

SoftBank has been on an acquisition spree, led by its OpenAI investment. Other recent purchases include ABB Ltd.’s industrial robotics business for $5.4 billion and data center-focused private equity firm DigitalBridge Group Inc. for about $3 billion in cash.

To finance those deals, SoftBank has been replacing its shorter-term loans with debt carrying longer maturities to strengthen its financial position. SoftBank repaid this week the entire outstanding balance of $25.9 billion on a $40 billion one-year loan to fund its investment in OpenAI.

SoftBank also last month secured a $10 billion two-year loan using its OpenAI stake from lenders including Apollo.

Among tech giants, Oracle is considered to have one of the highest exposure to spending risk among the major AI players, which is overshadowing robust growth in its cloud-computing division. Meta’s capital expenditure has severely diminished its free cash flow, which is projected to turn negative in the third quarter.

For Son, his growing list of ambitions includes aggressive data center expansion in the US and France. SB Energy Inc., SoftBank’s US unit, is developing 8.8 gigawatts of data center capacity across America that is estimated to require $174 billion in capital spending. SoftBank has also announced plans to build a 5-gigawatt data center in France.

The cost of insuring SoftBank’s debt against default has climbed this year, with credit-default swaps marking a three-year high earlier this week.

Saudi Aramco has told European refiners they won’t receive contracted crude shipments next month as damage to Saudi Arabia’s East-West pipeline deepens a supply crunch already aggravated by disruptions in the Strait of Hormuz and growing threats to Red Sea shipping, according to Bloomberg. Oil prices erased steep early losses following the report.

At least two European customers were informed that no Saudi crude would be available for October, according to people familiar with the matter cited by Bloomberg. The development marks an escalation from earlier delays and cancellations affecting September cargoes after attacks knocked the East-West pipeline out of service.

Brent crude had fallen to around $101.60 a barrel early Friday before recovering to roughly $105 by 10:32 a.m. ET. West Texas Intermediate briefly slipped below $100 before rebounding to about $103.30, with the front-month contract rising more than 1%. Barron’s reported WTI around $103.20 during early U.S. trading as traders reassessed near-term supply.

The reversal underscored the market’s sensitivity to Saudi export capacity. The kingdom’s East-West pipeline has become particularly important because it carries crude from producing regions near the Persian Gulf across Saudi Arabia to the Red Sea port of Yanbu, allowing shipments to bypass the Strait of Hormuz.

The pipeline has been shut since attacks damaged pumping infrastructure earlier this month. Three pumping stations were damaged, according to reports, complicating Saudi efforts to maintain exports at a time when normal tanker traffic through Hormuz has already been severely disrupted.

Saudi officials expect partial flows through the pipeline to resume within days as Aramco works on a bypass around damaged infrastructure. Full capacity could take roughly six weeks to restore if the system sustains no additional damage, according to people familiar with the repair effort.

The pipeline can move about 7 million barrels a day and has emerged as a critical alternative export route during the Middle East conflict. The volumes normally carried through it represent roughly 4% of global oil supply, magnifying the market impact of an extended outage.

Saudi Arabia is simultaneously confronting a second threat on its western export route. Yemen’s Iran-aligned Houthis have advanced along the Red Sea coast and around the Bab el-Mandeb Strait, increasing risks to Saudi tankers and other shipping using the narrow passage connecting the Red Sea with the Gulf of Aden.

Those developments have prompted Riyadh to seek diplomatic help from Beijing. Saudi Arabia asked China to intervene with Iran, after which Beijing privately urged Tehran to use its influence over the Houthis to prevent the conflict from spreading further along critical energy routes, three Iranian sources familiar with the discussions told Reuters.

Iranian Foreign Minister Abbas Araghchi visited China this week and met Chinese Foreign Minister Wang Yi, though Reuters couldn’t determine whether Beijing’s request was delivered during that meeting. Tehran responded that regional stability depended on ending the U.S.-Israeli war against Iran, according to the Iranian sources.

“China does not wish to see regional tensions further spill over into Yemen and the Red Sea. Escalating regional instability is not in the interests of any party,” China’s Foreign Ministry told Reuters. Beijing also called for protection of infrastructure important to civilian livelihoods and for disputes to be addressed through negotiation.

China has substantial economic exposure to any prolonged disruption. It gets roughly half its imported oil from the Middle East and bought more than 80% of Iran’s seaborne oil exports last year, according to Kpler data cited by Reuters, while its trade with Gulf Cooperation Council countries totals around $300 billion annually.

The pressure on Saudi exports now stretches across several routes at once: Hormuz traffic remains severely constrained, the East-West pipeline is undergoing repairs and the Houthi advance is adding risk around the Bab el-Mandeb. Saudi Arabia has also explored alternative arrangements through Oman as it works to keep crude moving while the pipeline is restored.

Crusoe Inc. today announced that it has closed a $3.9 billion late-stage funding round at a $30.9 billion valuation.

The Series F deal was led by Atreides Management, Mubadala Capital and Valor Equity Partners. They were joined by more than two dozen other investors. The group included Nvidia Corp., Salesforce Ventures and Robinhood Ventures Fund.

Denver-based Crusoe builds artificial intelligence data centers for tech firms. Its flagship project is a 1.2-gigawatt AI campus in Abilene, Texas that Oracle Corp. will use to host workloads for OpenAI Group PBC. Crusoe is also building a 900-megawatt site for Microsoft Corp. nearby.

The company makes many of the electrical components that power its data centers in-house. Crusoe manufactures, among others, industrial controls that coordinate the flow of electricity and circuit breakers. It also makes the specialized enclosures in which such components are housed. The cabinets protect electrical equipment from dust and water.

Crusoe customers who don’t require a full data center can purchase a computing module called Spark. It combines graphics cards, storage equipment and cooling systems in a container-size enclosure. Built-in satellite connectivity enables Spark systems to run in areas that lack terrestrial networking infrastructure.

The company offers its data center construction services alongside an AI-optimized cloud platform called Crusoe Cloud. It says the platform’s annualized revenue has increased by a factor of more than 20 over the past year. One of the main drivers behind that growth is a service called Managed Inference. Crusoe says the annualized recurring revenue generated by the service offering topped $100 million within a year of its launch.

Managed Inference enables users to run AI models without managing the underlying hardware. A software engine called MemoryAlloy caches data that is frequently reused by customers’ models. That removes the need to generate the data from scratch for every user request, which speeds up processing. Crusoe claims that the technology can provide a fivefold throughput increase for some workloads.

Managed Inference is available alongside Serverless Fine-Tuning, a service that developers can use to customize open-source AI models. Crusoe Cloud ingests the training datasets needed for the task from sources such as Amazon S3. It keeps the information in storage hardware developed by a startup called Vast Data Inc. Crusoe says its infrastructure can accommodate petabytes of training data.

The company disclosed today that it has more than 6 gigawatts of contracted data center capacity in the works. According to the Wall Street Journal, some of that capacity will be located at a campus the company is building for Google LLC in Texas. Crusoe says its data center projects represent more than $140 billion in contracted revenue.

“We believe AI will usher in an era of abundance: new scientific breakthroughs, unprecedented economic growth, and human prosperity,” said Chase Lochmiller, co-founder and CEO of Crusoe. “Getting there means controlling the infrastructure from electrons to tokens, and we’re grateful to have investors who share that conviction. This Series F lets us scale every layer for the world’s most ambitious AI builders.”

Shares of U.S. power equipment maker Generac Holdings (GNRC) climbed by 19% to about $207 on Thursday afternoon. This followed analysts’ praise for its new $8 billion generator supply deal with Amazon (AMZN). Notably, Roth MKM analyst Chip Moore described the deal as “transformational” while Wells Fargo’s Praneeth Satish noted that GNRC was trading at a “steep discount” following the deal.

Satish maintained his Buy rating on Generac. He also backed his previous price target of $280, implying about 35% upside. By contrast, Moore kept his Hold rating despite lifting his price target from $214 to $250, implying about 21% upside.

A regulatory filing on Wednesday showed that Amazon has awarded Generac the deal to supply backup generators for its data centers. For the first stage, Amazon is expected to take delivery of about $2.4 billion worth of generators between 2027 and 2028.

Under the deal, Generac issued a warrant allowing Amazon to buy 1.69 million shares at $200.93 per share. About 307,954 shares qualified for that immediately. However, the remainder is tied to Amazon buying up to $8 billion worth of additional backup generators from Generac.

The filing shows the warrant remains active until September 2033.

According to Roth Capital’s Chip Moore, the deal is “transformational” for Generac. After the deal, the analyst said he updated his estimates. The new estimates accounted for possible future projects involving commercial and industrial data center clients.

Despite maintaining his Hold rating, the analyst noted that the reward-to-risk of investing in GNRC stock is “increasingly positive.”

Meanwhile, Wells Fargo’s Praneeth Satish noted that the deal positions Generac to become the supplier of almost 50% of Amazon’s diesel generator needs.

He believes that this could help the generator maker to top $3 billion in data center revenue by 2028.

To put the scale in perspective, Generac reported $4.2 billion in total revenue for 2025, meaning this single partnership could approach double that figure when fully executed. The agreement’s structure includes Amazon’s subsidiary receiving warrants with an expiration date of September 16, 2033.

On Wall Street, analysts have a Moderate Buy consensus rating on Generac Holdings’ shares. This is based on 13 Buys and five Holds issued by 18 analysts over the past three months.

However, the average GNRC price target of $305.50 implies about 47% upside.