Microsoft: Chinese Hackers Breached US Govt Email Accounts

FILE PHOTO: Microsoft logo is seen on a smartphone placed on displayed Activision Blizzard logo in this illustration taken January 18, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
FILE PHOTO: Microsoft logo is seen on a smartphone placed on displayed Activision Blizzard logo in this illustration taken January 18, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
TT

Microsoft: Chinese Hackers Breached US Govt Email Accounts

FILE PHOTO: Microsoft logo is seen on a smartphone placed on displayed Activision Blizzard logo in this illustration taken January 18, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
FILE PHOTO: Microsoft logo is seen on a smartphone placed on displayed Activision Blizzard logo in this illustration taken January 18, 2022. REUTERS/Dado Ruvic/Illustration/File Photo

Chinese-based hackers seeking intelligence information breached the email accounts of a number of US government agencies, computer giant Microsoft said.

"The threat actor Microsoft links to this incident is an adversary based in China that Microsoft calls Storm-0558," the company said in a blog post late Tuesday.

Microsoft said Storm-0558 gained access to email accounts at approximately 25 organizations including government agencies, AFP said.

Microsoft did not identify the targets but a US State Department spokesperson said the department had "detected anomalous activity" and had taken "immediate steps to secure our systems."

"As a matter of cybersecurity policy, we do not discuss details of our response and the incident remains under investigation," the spokesperson said.

According to The Washington Post, the breached email accounts were unclassified and "Pentagon, intelligence community and military email accounts did not appear to be affected."

But the paper reported Wednesday evening, quoting US officials, that State Department email accounts and that of Commerce Secretary Gina Raimondo were hacked. Raimondo's agency has angered China by imposing tough export controls on Chinese technologies.

CNN, citing sources familiar with the investigation, said the Chinese hackers targeted a small number of federal agencies and the email accounts of specific officials at each agency.

In the blog post, Charlie Bell, a Microsoft executive vice president, said "we assess this adversary is focused on espionage, such as gaining access to email systems for intelligence collection.

"This type of espionage-motivated adversary seeks to abuse credentials and gain access to data residing in sensitive systems," Bell said.

US National Security Adviser Jake Sullivan addressed the hack in an appearance on Wednesday on ABC's Good Morning America, and said it had been detected "fairly rapidly."

"We were able to prevent further breaches," Sullivan said.

"The matter is still being investigated, so I have to leave it there because we're gathering further information in consultation with Microsoft and we will continue to apprise the public as we learn more," Sullivan said.

Espionage and data theft
Microsoft said Storm-0558 "primarily targets government agencies in Western Europe and focuses on espionage, data theft, and credential access."

The Redmond, Washington-based company said it had launched an investigation into "anomalous mail activity" on June 16.

"Over the next few weeks, our investigation revealed that beginning on May 15, 2023, Storm-0558 gained access to email accounts affecting approximately 25 organizations including government agencies as well as related consumer accounts.

"They did this by using forged authentication tokens to access user email using an acquired Microsoft account consumer signing key," the company said. "Microsoft has completed mitigation of this attack for all customers."

US Senator Mark Warner, chairman of the Senate Select Committee on Intelligence, said the panel is "closely monitoring what appears to be a significant cybersecurity breach by Chinese intelligence."

"It's clear that the PRC is steadily improving its cyber collection capabilities directed against the US and our allies," Warner said in a statement.

Disclosure of the Chinese hacking comes on the heels of trips to China by US Secretary of State Antony Blinken and Treasury Secretary Janet Yellen and the shooting down by the United States of a Chinese surveillance balloon.

In May, Microsoft said state-sponsored Chinese hackers called "Volt Typhoon" had infiltrated critical US infrastructure networks.

Microsoft highlighted Guam, a US territory in the Pacific Ocean with a vital military outpost, as one of the targets in that attack, but said "malicious" activity had also been detected elsewhere in the United States.

"Microsoft assesses with moderate confidence that this Volt Typhoon campaign is pursuing development of capabilities that could disrupt critical communications infrastructure between the United States and Asia region during future crises," the company said at the time.

Microsoft's May statement coincided with an advisory released by US, Australian, Canadian, New Zealand and British authorities warning that the hacking was likely occurring globally.

China denied the allegations, describing the Microsoft report as "extremely unprofessional" and "scissors-and-paste work."

"It is clear that this is a collective disinformation campaign of the Five Eyes coalition countries, initiated by the US for its geopolitical purposes," foreign ministry spokeswoman Mao Ning said, referring to the security alliance of the United States and its Western allies that wrote the report.



Nvidia Boss Insists 'Huge' Investment in OpenAI on Track

Nvidia CEO Jensen Huang insists the US tech giant is going to make 'a huge investment in OpenAI'. Patrick T. Fallon / AFP/File
Nvidia CEO Jensen Huang insists the US tech giant is going to make 'a huge investment in OpenAI'. Patrick T. Fallon / AFP/File
TT

Nvidia Boss Insists 'Huge' Investment in OpenAI on Track

Nvidia CEO Jensen Huang insists the US tech giant is going to make 'a huge investment in OpenAI'. Patrick T. Fallon / AFP/File
Nvidia CEO Jensen Huang insists the US tech giant is going to make 'a huge investment in OpenAI'. Patrick T. Fallon / AFP/File

Nvidia chief executive Jensen Huang has insisted the US tech giant will make a "huge" investment in OpenAI and dismissed as "nonsense" reports that he is unhappy with the generative AI star.

Huang made the remarks late Saturday in Taipei after the Wall Street Journal reported that Nvidia's plan to invest up to $100 billion in OpenAI had been put on ice, said AFP.

Nvidia announced the plan in September to invest $100 billion in OpenAI, building infrastructure for next-generation artificial intelligence.

The Wall Street Journal, citing unnamed sources, said some people inside Nvidia had expressed doubts about the deal and that the two sides were rethinking the partnership.

"That's complete nonsense. We are going to make a huge investment in OpenAI," Huang told journalists, when asked about reports that he was unhappy with OpenAI.

Huang insisted that Nvidia was going ahead with its investment in OpenAI, describing it as "one of the most consequential companies of our time".

"Sam is closing the round, and we will absolutely be involved in the round," Huang said, referring to OpenAI chief executive Sam Altman.

"We will invest a great deal of money, probably the largest investment we've ever made."

Nvidia has come to dominate spending on the processors needed for training and operating the large language models (LLM) behind chatbots like OpenAI's ChatGPT or Google Gemini.

Sales of its graphics processing units (GPUs) -- originally developed for 3D gaming -- powered the company's market cap to over $5 trillion in October, although the figure has since fallen back by more than $600 billion.

LLM developers like OpenAI are directing much of the mammoth investment they have received into Nvidia's products, rushing to build GPU-stuffed data centers to serve an anticipated flood of demand for AI services.


Meta Shares Skyrocket, Microsoft Slides on Wall Street after Earnings

A Microsoft logo is seen a day after Microsoft Corp's $26.2 billion purchase of LinkedIn Corp, in Los Angeles, California, US, June 14, 2016. REUTERS/Lucy Nicholson
A Microsoft logo is seen a day after Microsoft Corp's $26.2 billion purchase of LinkedIn Corp, in Los Angeles, California, US, June 14, 2016. REUTERS/Lucy Nicholson
TT

Meta Shares Skyrocket, Microsoft Slides on Wall Street after Earnings

A Microsoft logo is seen a day after Microsoft Corp's $26.2 billion purchase of LinkedIn Corp, in Los Angeles, California, US, June 14, 2016. REUTERS/Lucy Nicholson
A Microsoft logo is seen a day after Microsoft Corp's $26.2 billion purchase of LinkedIn Corp, in Los Angeles, California, US, June 14, 2016. REUTERS/Lucy Nicholson

Shares in Meta skyrocketed by 10 percent at opening on Wall Street on Thursday, a day after the social media giant posted better than expected earnings as the company invests heavily in artificial intelligence.

Microsoft, whose earnings disappointed analysts, saw its share price tumble by 10 percent, with investors showing concern for the return on investment for the software giant's spending on AI.


Samsung Logs Best-ever Profit on AI Chip Demand

South Korean tech giant Samsung Electronics posted record quarterly profits on Thursday, riding strong market demand for its artificial intelligence chips. Jung Yeon-je / AFP/File
South Korean tech giant Samsung Electronics posted record quarterly profits on Thursday, riding strong market demand for its artificial intelligence chips. Jung Yeon-je / AFP/File
TT

Samsung Logs Best-ever Profit on AI Chip Demand

South Korean tech giant Samsung Electronics posted record quarterly profits on Thursday, riding strong market demand for its artificial intelligence chips. Jung Yeon-je / AFP/File
South Korean tech giant Samsung Electronics posted record quarterly profits on Thursday, riding strong market demand for its artificial intelligence chips. Jung Yeon-je / AFP/File

South Korean tech giant Samsung Electronics posted record quarterly profits Thursday, riding massive market demand for the memory chips that power artificial intelligence.

A global frenzy to build AI data centers and develop the fast-evolving technology has sent orders for advanced high bandwidth memory microchips soaring.

That is also pushing up prices for less flashy chips used in consumer electronics -- threatening higher prices for phones, laptops and other devices worldwide.

In the quarter to December 2025, Samsung said it saw "its highest-ever quarterly consolidated revenue at KRW 93.8 trillion (US$65.5 billion)", a quarter-on-quarter increase of nine percent.

"Operating profit was also an all-time high, at KRW 20.1 trillion," the company said.

The dazzling earnings came a day after a key competitor, South Korean chip giant SK hynix, said operating profit had doubled last year to a record high, also buoyed by the AI boom.

The South Korean government has pledged to become one of the top three AI powers, behind the United States and China, with Samsung and SK hynix among the leading producers of high-performance memory.

Samsung said Thursday it expects "AI and server demand to continue increasing, leading to more opportunities for structural growth".

Annual revenue stood at 333.6 trillion won, while operating profit came in at 43.6 trillion won. Sales for the division that oversees its semiconductor business rose 33 percent quarter-on-quarter.

The company pointed to a $33.2 billion investment in chip production facilities -- pledging to continue spending in "transitioning to advanced manufacturing processes and upgrading existing production lines to meet rising demand".

- 'Clearly back' -

Major electronics manufacturers and industry analysts have warned that chipmakers focusing on AI sales will cause higher retail prices for consumer products across the board.

This week US chip firm Micron said it was building a $24 billion plant in Singapore in response to AI-driven demand that has caused a global shortage of memory components.

SK hynix announced Wednesday that its operating profit had doubled last year to a record 47.2 trillion won.

The company's shares have surged some 220 percent over the past six months, while Samsung Electronics has risen about 130 percent, part of a huge global tech rally fueled by optimism over AI.

Both companies are on the cusp of producing next-generation high-bandwidth "HBM4" chips for AI data centers, with Samsung reportedly due to start making them in February.

American chip giant Nvidia -- now the world's most valuable company -- is expected to be one of Samsung's customers for HBM4 chips.

But Nvidia has reportedly allocated around 70 percent of its HBM4 demand to SK hynix for 2026, up from the market's previous estimate of 50 percent.

"Samsung is clearly back and we are expecting them to show a significant turnaround with HBM4 for Nvidia's new products -- helping them move past last year's quality issues," Hwang Min-seong, research director at market analysis firm Counterpoint, told AFP.

But SK still "maintains a market lead in both quality and supply" of a number of key components, including Dynamic Random Access Memory chips used in AI servers, he said.

SK also this week said it will set up an "AI solutions firm" in the United States, committing $10 billion and weighing investments in US companies.