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Speaker 1: Live from the Bloomberg Interacted Burger Studios. This is Bloombergy

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Speaker 1: Daybreak for Friday, January. Coming up this hour, Intel shares

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Speaker 1: plunge after one of the gloomiest forecasts in its history.

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Speaker 1: Hasbro is the latest company to slash jobs. Republicans may

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Speaker 1: be willing to raise the dead select temporarily, and Japan

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Speaker 1: and the Netherlands moved closer to joining the US on

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Speaker 1: China ship restrictions. A guilty verdict for the man who

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Speaker 1: killed eight people along the New York Punk Path, plus

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Speaker 1: cities brace for the video release of Memphis officers in

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Speaker 1: a deadly beating. I'm Michael bar More Ahead, I'm John

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Speaker 1: Stash Aaron sports thrilling overtime win for the Knicks in Boston,

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Speaker 1: the Nets lost to Detroit, the Devil's lost in Nashville.

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Speaker 1: That's all s traded ahead on Bloomberg day Break on

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Speaker 1: Bloomberg eleven three on New York, Bloomberg one, Washington d C,

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Speaker 1: Bloomberg one oh six one, Boston, Bloomberg nine sixties and

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Speaker 1: Francisco Sirius x M one nine team and around the

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Speaker 1: world on Bloomberg Radio dot Com and via the Bloomberg

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Speaker 1: Business Good morning. I'm Nathan Hagar and I'm Karin Moscow.

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Speaker 1: Here are the stories we're following today. Let's begin with

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Speaker 1: an earnings disappointment from Intel. The shares are down more

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Speaker 1: than nine percent after the downbeat results. Let's get the

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Speaker 1: latest live from Bloomberg's Steve Rappaport. Good morning, Steve, Good morning, Nathan,

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Speaker 1: and Karen. Intel's out with a forecast that's one of

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Speaker 1: the worst in the chip maker's history, predicting a gross

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Speaker 1: margin of thirty seven for this quarter. Despite that outlook,

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Speaker 1: CEO Pat Gelsinger says the company remains focused on the

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Speaker 1: big picture. I want to remind everyone that we are

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Speaker 1: on a multi year journey. We remain focused on the

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Speaker 1: things that are within our control as we navigate short

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Speaker 1: term headwinds while let's secut into our long term strategy.

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Speaker 1: Gelsinger adding he thinks momentum will stabilize this year. Live

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Speaker 1: from New York, I'm Steve Rappaport, Bloomberg Daybreak. All right, Steve,

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Speaker 1: thank you all. Disappointing earnings are also taking a toll

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Speaker 1: on Hasbro this morning. Shares at the Toy are down

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Speaker 1: more than five percent, and Bloomberg's Charlie Pellett reports Hasbro

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Speaker 1: is cutting fiferent of its workforce. That's eleven thousand jobs,

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Speaker 1: and it comes after a disappointing holiday shopping season. The

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Speaker 1: company also projected it will fall short of fourth quarter

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Speaker 1: adjusted profit estimates. The company said while it's digital gaming business,

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Speaker 1: including Dungeons and Dragons and Magic the Gathering, perform well,

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Speaker 1: it's traditional toy business faltered. Changes to its business plan

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Speaker 1: are expected to result in charges of about three hundred

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Speaker 1: million dollars. As part of the changes, president Eric Niman

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Speaker 1: is leaving the company in New York. Charlie Pellett Bloomberg

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Speaker 1: day Break. All right, Charlie, thank you. Another corporate story

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Speaker 1: this morning centers on bed Bath and Beyond. The struggling

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Speaker 1: retailer is moving closer to bankruptcy. We get more from

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Speaker 1: Bloomberg's Doug Prisner. In a filing on Thursday, the retailer

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Speaker 1: said it received a default notice from JP Morgan Chase

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Speaker 1: after breaching the terms of its credit line, but Bedad

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Speaker 1: and Beyond warned it didn't have enough funds. The company

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Speaker 1: listed around two point one billion dollars of obligations it

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Speaker 1: owed as of November. One analyst said the likelihood of

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Speaker 1: a bankruptcy filing within the next thirty days is relatively high. Earlier,

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Speaker 1: Bloomberg reported the company has begun speaking with potential lenders

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Speaker 1: on funding the firm during bankruptcy proceedings in New York.

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Speaker 1: I'm Doug Prisner, Bloomberg daybreak. All right, thank you, While

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Speaker 1: turning to the markets. Now, US futures are lower as

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Speaker 1: we close out the trading week. At the same time,

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Speaker 1: the SNP five hundred is coming off its highest close

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Speaker 1: since early December. Patrick Calfrey is senior equity strategistic Credit Sweez.

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Speaker 1: I think the equity picture right here actually looks pretty good.

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Speaker 1: I mean, we've seen the market rally almost eleven since

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Speaker 1: the end of September, or up four and a half

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Speaker 1: percent year to date, and really that's in response to

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Speaker 1: the fact that we are having interest rates come in.

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Speaker 1: Credit spreads are narrowing in, the vix is falling. That

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Speaker 1: is a good backdrop for risk. Credit Sue Senior equity

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Speaker 1: strategist Patrick Paul Frey is also watching the Fed. He

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Speaker 1: sees two more rate hikes coming from the Central Bank

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Speaker 1: followed by a pause. Like he inflation report for the

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Speaker 1: FED comes out this morning. Karen. December's personal consumption expenditure

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Speaker 1: prices are forecast to be unchanged while the core rate

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Speaker 1: rises three tenths. We get more on the upcoming inflation

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Speaker 1: report from Bloomberg Economics correspondent Michael McKee The data should

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Speaker 1: continue a string of good news on inflation. Falling energy

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Speaker 1: prices and holiday discounts to clear merchandise will put downward

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Speaker 1: pressure on the Fed's favorite price index, and the year

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Speaker 1: over year change in both headline PC and core are

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Speaker 1: likely to come in softer than Fed officials had forecast.

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Speaker 1: The income and spending numbers may not be as cheerful,

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Speaker 1: with incomes barely rising and spending set to drop. Retail

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Speaker 1: sales were down in December. The report will tell us

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Speaker 1: whether that meant more was spent on services or whether

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Speaker 1: consumers simply pulled back. Michael mckeey, Bloomberg Daybreak. All right, Mike,

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Speaker 1: thank you all. Turning to Washington now, there may be

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Speaker 1: some movement in the fight over the debts sailing. Bloomberg

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Speaker 1: News has learned House Republicans are considering a short term

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Speaker 1: increase until September thirty that would allow more time to

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Speaker 1: negotiate with Democrats, though it's not clear whether they're open

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Speaker 1: to it. Republican Congressman Dusty Johnson of South Dakota says,

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Speaker 1: this issue will get resolved. What we're getting is a

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Speaker 1: credit card bill, and it is a whop, and I

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Speaker 1: get it. We have to pay the credit card bill.

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Speaker 1: We absolutely should not default on our death. But when

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Speaker 1: a company gets that credit card bill show up in

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Speaker 1: the mail, it is exactly the right time for them

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Speaker 1: to sit down and have a family conversation about how

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Speaker 1: do they get the spending under control. Congressman Dusty Johnson

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Speaker 1: spoke with Our Washington corresponded Joe Matthew on Bloomberg sound On.

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Speaker 1: Catch the show weekdays at five pm Eastern on Bloomberg

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Speaker 1: Radio or subscribe to the Bloomberg sound On podcast. Turning

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Speaker 1: to geopolitics, Karen, the US is limiting China's access to

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Speaker 1: advanced semiconductor equipment, and now Japan and the Netherlands are

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Speaker 1: poised to do the same. Bloomberg Daybreak Asia anchor Brian

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Speaker 1: Curtis has more from Hong Kong. Sources say the three

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Speaker 1: countries are on the verge of forging a powerful alliance.

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Speaker 1: It will undercut China's ambitions to build its own ship capabilities,

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Speaker 1: Bloomberg saidwin Chan says it would be a black eye

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Speaker 1: for China. It's with the significant victory for the Biden administration,

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Speaker 1: It's something that the US could not have done alone

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Speaker 1: contained China's chip ambitions. If key allies, such as an

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Speaker 1: evalence in Japan refused to participate, the talks could conclude

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Speaker 1: as soon as today. In Hong Kong, Bran Curtis Bloomberg,

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Speaker 1: Day bright, It's thirty six degrees in Central Park. It's

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Speaker 1: gonna be partly sunny and cool today with highs in

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Speaker 1: the low forties. Will get back down to the low

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Speaker 1: thirties tonight under Apartment Cloudy sky Time. How to look

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Speaker 1: at some of the other stories making news in New

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Speaker 1: York and around the world. Good morning, Michael Vare, Good

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Speaker 1: morning Nathan. New York City and Long with other major

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Speaker 1: cities across the nation, are bracing for tonight's video release

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Speaker 1: of a confrontation with Memphis police officers accused in the

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Speaker 1: beating death of a twenty nine year old black motorists

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Speaker 1: earlier this month. The five Fiard officers have been charged

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Speaker 1: with murder and other crimes in the killing of Tyree Nichols.

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Speaker 1: All of the officers are black. Last night, a vigil

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Speaker 1: was held for Nichols. His mother, rove On Wells, told

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Speaker 1: the crowd to be peaceful when the video is released.

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Speaker 1: I don't want us burning up our cities, turning up

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Speaker 1: the streets, because that's not what my son stood for.

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Speaker 1: This officials say the video will show the entire faithful encounter,

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Speaker 1: from beginning to end. A New York lawyer has been

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Speaker 1: sentenced from the George Floyd protests. In a judge ordered

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Speaker 1: Collinford Maddis to spend a year and a day in

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Speaker 1: prison and pay just over thirty thou dollars to the

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Speaker 1: NYPD for the fire bombing of a police car. Maddis

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Speaker 1: and Rouge Raman were arrested as demonstrations and protests rage

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Speaker 1: over the killing of Floyd at the hands of police

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Speaker 1: in Minneapolis. Rahman was sentenced in November to fifteen months

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Speaker 1: in prison. And Islamic extremists who killed eight people a

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Speaker 1: speeding truck in the seen rampage on the West Side

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Speaker 1: Highway bike path has been convicted of federal charges and

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Speaker 1: could face the death penalty. Jurors in the Manhattan courtroom

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Speaker 1: found Cipolo Psipop guilty. The jury will return to court

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Speaker 1: no earlier than February six to decide whether Psipop should

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Speaker 1: be executed. New York Mayor Eric Adams vowed in his

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Speaker 1: State of the City addressed to increase the number of

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Speaker 1: police and hold drivers accountable. Adams also says he wants

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Speaker 1: to get repeat offenders off the streets. He reflected on

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Speaker 1: his first year in office, we hit the ground running

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Speaker 1: and we got stuff done. One year later, our cities

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Speaker 1: on the pathway to being safer. Our economy is recovering,

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Speaker 1: and our stores, subways in hotels a full. Mayor Adams

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Speaker 1: says the state of the city is strong. Global news

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Speaker 1: twenty four hours a day on air and on Bloomberg Quicktake,

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Speaker 1: powered by more than journal list and analyist more than

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Speaker 1: a hundred twenty countries. I'm Michael Barr and this is Bloomberg.

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Speaker 1: Thanks Michael, timing out for the Bloomberg Sports update, brought

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Speaker 1: to you by Tri State Auty. For that, we bring

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Speaker 1: in John Session. Thanks Nathan. The Knicks best win of

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Speaker 1: the season in Boston, Celtics at the NBA's best record

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Speaker 1: and they jumped in front by fifteen. Nicks blew a

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Speaker 1: fourth quarterly that's happened a lot, but they rallied in overtime,

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Speaker 1: big three point by r J. Barrett. Julius Randall's two

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Speaker 1: free throws put him a head Nicks one one one seventeen.

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Speaker 1: Randalls scored thirty seven. Jalen Brunson at twenty nine. Nicks

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Speaker 1: continue to be better on the road than at home.

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Speaker 1: It's their fifteenth road win. Only the Celtics have more.

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Speaker 1: The Nets began a stretch of home games, losing to

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Speaker 1: Detroit one thirty one twenty two. They clearly missed Kevin Durant.

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Speaker 1: Nets have lost six of their last eight. Devils lost

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Speaker 1: at Nashville six four, in the third time this season

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Speaker 1: they've allowed that many goals. Novak Djokovic playing his Australian

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Speaker 1: Open semifinal match right now, and he leads American Tommy

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Speaker 1: Paul seven five three love earlier a semifinal win in

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Speaker 1: four sets, force stefinal sits pass. Two NFL head coaches

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Speaker 1: fired during the season, he got new jobs. Frank Reich

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Speaker 1: lost his job in Indianapolis but hired by Carolina, and

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Speaker 1: Nathaniel Hackett fired in Denver, and he's now the offensive

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Speaker 1: coordinator of the Jets Conference Championship. Sunday begins in the

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Speaker 1: NFC in Philadelphia. Eagles forty nine is the a f

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Speaker 1: C game, a rematch from last year when Joe Burrow

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Speaker 1: led Cincinnati to a comeback overtime win at Kansas City.

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Speaker 1: Can Burrow and the Bengals do it again. We've been

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Speaker 1: in these spots, um, they have the experience. We know

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Speaker 1: a team we're playing team has been in this this

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Speaker 1: game the last five seasons and there they've all been

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Speaker 1: in that stadium. So to me, they're still a team

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Speaker 1: to beat, and then we're coming for him, but we

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Speaker 1: know it's gonna be tough. Burrow in the last two

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Speaker 1: years has won three playoff road games. Longtime college basketball

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Speaker 1: analyst Billy Packer has died. He was eighty two. John

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Speaker 1: stash Award Bloomberg Sports Live from coast to coast from

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Speaker 1: New York to Send Francisco, Boston to Washington, d C.

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Speaker 1: Nationwide on Sirius Examp, the Bloomberg Business app, and Bloomberg

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Speaker 1: dot Com. This is Bloomberg Daybreak. Good morning, I'm Nathan Hagar.

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Speaker 1: At the end of a big week for big tech earnings.

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Speaker 1: The focus this morning is on Intel and the disappointment

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Speaker 1: from the chip maker. The shares are down nine percent

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Speaker 1: after one of the gloomiest quarterly forecasts in Intel's history.

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Speaker 1: Bloomberg Quick Take correspondent Alex Webb is back with us

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Speaker 1: this morning for more on the earnings and the overall

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Speaker 1: chips story. Alex, good morning. How big a surprise was

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Speaker 1: it that Intel came out with this forecast? It was

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Speaker 1: something like at least two and a half billion dollars

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Speaker 1: lower than the average estament. It certainly was a bit

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Speaker 1: of a sideswipe. The market was not anticipating good news,

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Speaker 1: but the scope of the miss was quite considerable. The

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Speaker 1: consensus had been for first quarter sales of fourteen billion dollars.

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Speaker 1: Intel's projecting it's going to be between ten and a

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Speaker 1: half and eleven and a half. That would make it,

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Speaker 1: you know, the lowest in some twenty years. Also me

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Speaker 1: ten years or so, so it's um a bit a

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Speaker 1: sizeable blow. Hope, is then that some analyst commentary this

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Speaker 1: morning that they're frontloading a lot of the bad news

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Speaker 1: and just saying we're going to take a painful quarter

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Speaker 1: and with the hope that they rebound a bit in

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Speaker 1: the second half. Is this just an Intel story or

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Speaker 1: does this say something more about the overall outlook for

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Speaker 1: the tech sector. I mean, we've been talking for quite

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Speaker 1: some time about a lot of these magacap names are

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Speaker 1: in retrenchment mode after the pandemic and trying to cut cast. Uh,

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Speaker 1: there's clearly our broader issues in the tech sector. Of course,

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Speaker 1: you know, there is a lot of the tech sector

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Speaker 1: encompasses a lot of very different businesses. You know, of

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Speaker 1: an online advertising is not the same as chipmaking, but

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Speaker 1: we have seen that the personal computing business, and that's

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Speaker 1: what's really hurting Intel right now that it is clearly

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Speaker 1: not going to e really well. So that obviously has

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Speaker 1: implications for Dell, for parts of Apple's business in others besides,

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Speaker 1: but also some of the chipmaking peers like A m

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Speaker 1: D and Nvidia, who don't how quite the problems that

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Speaker 1: Intel might do, but that they're likely to see some

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Speaker 1: some similar effects in the most recent quarters. Well, what

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Speaker 1: is the issue, Alex for Intel that's holding it back?

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Speaker 1: Why is it that we're seeing this sort of slow

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Speaker 1: down in PC sales in particular that's affecting Intel. A

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Speaker 1: lot of spending got front loaded during the pandemic, so

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Speaker 1: it's a combination of two factors, you know, as people

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Speaker 1: had to work from home or they needed a better

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Speaker 1: computing setup, so people bought laptops. Companies bought laptops and

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Speaker 1: clearly some desktops as well. But there was also a

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Speaker 1: little bit more disposable income floating around. Some people, you know,

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Speaker 1: had more money during the pandemic, not everybody by any

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Speaker 1: stretch of the imagination, and that meant that they're able

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Speaker 1: to buy new gear now as personal finances become a

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Speaker 1: little bit more straightened. Uh and frankly, little people already

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Speaker 1: have these new laptops. There isn't as much demand, and

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Speaker 1: so there's quite a lot of inventory sitting around and

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Speaker 1: warehouses from from personal computing companies. So that's really pounding

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Speaker 1: what's already not a terribly happy ship at Intel. Who

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Speaker 1: that has been has been hemorrhaging market share to t SMC,

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Speaker 1: the big contract manufacturer of semi conductors, and is in

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Speaker 1: the middle of a huge strategic pivot to try to

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Speaker 1: catch up. And even before these earnings came out, Alex

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Speaker 1: you know, the CEO of Intel, Pad Gelsinger, has been

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Speaker 1: talking for quite some time about a multi year turnaround

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Speaker 1: plan that he's trying to implement an Intel. When you

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Speaker 1: have an outlook like this, does that raise some doubts

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Speaker 1: for investors about whether that multi year plan is working.

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Speaker 1: You know, he was reminding people on the call uh

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Speaker 1: that it is a multi year plan asking for more patients.

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Speaker 1: It clearly is, particularly in a space like semi conductors,

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Speaker 1: where the innovation cycles you know, over quite a long

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Speaker 1: time frame. You know, between each new generation of chips,

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Speaker 1: the time it takes to get new new fabs, that's

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Speaker 1: the sort of factories essentially for semi conductors, the time

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Speaker 1: it takes to get them online is considerable. What Intel

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Speaker 1: is doing is trying to pivot towards contract manufacturing. So

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Speaker 1: the contract manufacturing is you know, Apple makes Apple designs

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Speaker 1: chips for instance, that go into its iPhones. It does

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Speaker 1: not make them. It contracts that out to t SMC

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Speaker 1: in Taiwan. Intel is trying to get into that business

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Speaker 1: so that it can try and offset the change the

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Speaker 1: declines at seeing elsewhere. That is a multi year project

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Speaker 1: and a huge significant change that can't happen overnight. In

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Speaker 1: our last minute here, Alex, there of course, there was

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Speaker 1: a lot of investment expected from the chips and Science

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Speaker 1: Act that was passed in Washington last year. Can Intel

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Speaker 1: account support from that, Yes, And we're seeing of plans

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Speaker 1: to open new facilities, for example in Columbus, Ohio. UM

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Speaker 1: it's fifty billion of spending that is coming from the government.

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Speaker 1: There is a huge bun fight right now between the

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Speaker 1: various chipmakers and not just American chipmakers to get a

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Speaker 1: piece of that. It's going to go into UH subsidizing

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Speaker 1: new manufacturing facilities, to training UM new engineers, to getting

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Speaker 1: into some of the underlying technolog It is partly a

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Speaker 1: play to reduce dependence on Taiwan. And when we think

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Speaker 1: about reduce dependance on Taiwan, a lot of that's TSMC.

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Speaker 1: So it is in the long stone something that could

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Speaker 1: and should benefit into. This is Bloomberg Daybreak Today, your

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