Speaker 1: Bloomberg Audio Studios, podcasts, radio news, The.
Speaker 2: Stock Movers podcast, your roundup of companies making moves in
Speaker 2: the stock market harnessing the power of Bloomberg Data.
Speaker 3: Let's take a look at the stocks on the move today,
Speaker 3: Ampass when alongside Isabelle Leeam were joined by our old
Speaker 3: friend Anna Ragrana, senior tech anast to Bloomberg Intelligence, Honor.
Speaker 3: A lot of news is going to be coming our
Speaker 3: way from your tech space. I'm going to start with Microsoft.
Speaker 3: Can you give us a summary of UPDATEA. What's happening
Speaker 3: with this software cyber breach here? Doesn't seem to be
Speaker 3: impacting the stock that much? What's Microsoft saying? If anything?
Speaker 4: I think the news is out and frankly, you know,
Speaker 4: apart from the one big breach last year where Crowdstride
Speaker 4: really got heard, these breaches typically don't have that big
Speaker 4: on an impact on the stock, frankly because you know,
Speaker 4: it's a small portion of the one particular application, and
Speaker 4: you know, I think the news story is far bigger
Speaker 4: than what it has an impact on the stock. In fact,
Speaker 4: if anything, people will be more inclined to buy Microsoft
Speaker 4: security products to protect themselves down the road. They would
Speaker 4: be more inclined to move more workloads to the cloud
Speaker 4: to make sure that the you know, the online version
Speaker 4: of the software was not impacted. So if you know,
Speaker 4: it just sells by itself, some of the security products
Speaker 4: and these beaches obviously not a good headline for the company,
Speaker 4: but you know, these things do happen quite a bit.
Speaker 1: How is the cloud business looking like these days? I
Speaker 1: feel like it's one of the main drivers of growth
Speaker 1: through many companies, from Amazon to Microsoft as we're talking
Speaker 1: about to most of the big tech giants. Is it
Speaker 1: competition becoming more fierce than is there a leader emerging
Speaker 1: in this space?
Speaker 4: See, the leader was always Aws, but frankly speaking, over
Speaker 4: the last two years, Microsoft has really narrowed the gap
Speaker 4: because of its open Ai relationship. They're the only company
Speaker 4: who's really seeing the biggest benefit of you know, all
Speaker 4: the searchers we're doing in chat GPT because open Ai
Speaker 4: runs primarily on Microsoft's cloud network. So when they report
Speaker 4: next week, we are expecting a big number coming out
Speaker 4: of that AI contribution. So Microsoft, I think, is the
Speaker 4: bigger benefitiary right now amongst all the bigger vendors.
Speaker 3: You know, it's interesting, is it worth investors ranking kind
Speaker 3: of who are the big cloud players? Who are the
Speaker 3: big AI players? Is it worth it or is it
Speaker 3: better just to say, you know, AI is going to
Speaker 3: kind of be all over the tech stack and then
Speaker 3: I just got to be long tech. How do you
Speaker 3: think about really getting quality exposure to that theme.
Speaker 4: Yeah, when you look at cloud, I think all of
Speaker 4: the top four vendors will flourish and flourish well when
Speaker 4: that would be Aws, Microsoft, Google and then Oracle after that,
Speaker 4: so all four will make a lot of money. Then
Speaker 4: you want to dissect each one of them. Within this group,
Speaker 4: Microsoft is the one that's seeing the current derect benefit
Speaker 4: and that's because of opening. The other two whether it's
Speaker 4: Amazon or Google will start to see more and more
Speaker 4: revenue flow in because of the applications people are building
Speaker 4: on their cloud platform. And then lastly on the Oracle side,
Speaker 4: they are benefiting in another part of cloud, which is
Speaker 4: more on the infrastructure side where they're getting a lot
Speaker 4: of money or you know, future funding from open Ai
Speaker 4: to create their data centers to help train the bottle.
Speaker 4: So each one is slightly different, but I would say
Speaker 4: as as you mentioned, the total basket you know should
Speaker 4: do well over time.
Speaker 1: You cover tech and next week is a big week
Speaker 1: for those companies and beyond tech. Bmots are expected to
Speaker 1: deliver nearly fifteen percent of profit growth and robust demand
Speaker 1: for AI, and that's compared to the virtually no growth
Speaker 1: for the rest of the four hundred and nine or
Speaker 1: three stocks. Are you watching anything and a specific company
Speaker 1: you're excited about and you mentioned you're looking at cloud,
Speaker 1: But is there anything else that is factoring in your outlook?
Speaker 4: So there can be two elements of it. One is
Speaker 4: the cloud, the AI side of spending, and the non
Speaker 4: AI side of spending what we saw from SAP and
Speaker 4: infoss and then you know taught all a couple of
Speaker 4: weeks ago, so that the non AI tech spending is
Speaker 4: under pressure. People are not spending as much because they
Speaker 4: are not sure how the tariff related uncertainty is just
Speaker 4: playing out, so they're seeing a delay in closing, closing
Speaker 4: of deals and everything around it. But on the AI side,
Speaker 4: we anticipate strong results from Microsoft, for example, So that's
Speaker 4: there the two dichotomy over there between the two vendors.
Speaker 4: The third thing that we are watching is actually what
Speaker 4: happens on the margin side of things because a lot
Speaker 4: of these companies are investing very heavily in AI. Because
Speaker 4: of that, their margins are going to get squeezed. And
Speaker 4: for that, what we think is going to happen is
Speaker 4: they're going to take reduction in force, either through not
Speaker 4: hiding at the same pace that they have been or
Speaker 4: basically laying off a portion of their workforce in order
Speaker 4: to counter some of that pressure. So those are the
Speaker 4: three themes that we are most interested in right now.
Speaker 3: An Agrana absolutely, thank you appreciate an Orana Tech Analysts
Speaker 3: Bloomberg Intelligence an Agrana mandep seing. Those are our two
Speaker 3: senior tech analysts. They manage our global technology research effort.
Speaker 3: For Bloomberg Intelligence, we have close to I think twenty
Speaker 3: analysts covering technology on a global basis, a lot based
Speaker 3: in Asia, based in the US, and based in Europe.
Speaker 3: And that's the way you have to cover at Folks.
Speaker 3: Tech is an all encompasing sector. It's the biggest part
Speaker 3: of the SMP five hundred and you have to the
Speaker 3: complete coverage, and we do on.
Speaker 2: A global basis.
Speaker 3: I think the best tech research on the street with
Speaker 3: the best data helping them to inform their research.
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