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Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.

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Speaker 2: Good morning.

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Speaker 3: I'm Nathan Hager and I'm Karen Moscow. Here are the

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Speaker 3: stories we're following today, Karen.

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Speaker 2: The jump in futures, particularly on the Nasdaq, follows blowout

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Speaker 2: quarters from a pair of tech heavyweights. Let's begin with Microsoft.

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Speaker 2: Those shares are up more than eight percent in early trading.

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Speaker 2: The software giant reported stronger than expected quarterly sales and

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Speaker 2: profit growth. Customer demand for cloud services held steady despite

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Speaker 2: economic turbulence. Azure's cloud unit at Microsoft posted a thirty

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Speaker 2: three percent revenue gain. Sixteen percentage points of that growth

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Speaker 2: was attributed to AI. Microsoft CEO Sati Nadella spoke on

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Speaker 2: the company conference call.

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Speaker 4: We just want to make sure we're building accounting for

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Speaker 4: the latest and greatest sort of information we have on

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Speaker 4: all of that, and that's what you see reflected. And

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Speaker 4: I feel any way good about the pain.

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Speaker 2: Microsoft CEO Satya Nadella expects the cloud unit to grow

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Speaker 2: as much as thirty five percent in the current quarter.

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Speaker 3: Well. Shares of Meta are also rallying this morning, Nathan.

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Speaker 3: They're up six percent. The Facebook and Instagram owner reported

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Speaker 3: fiscal quarter revenue that beat expectations. The company also said

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Speaker 3: current quarter revenue will be in line with analyst estimates.

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Speaker 3: Here's CEO Mark Zuckerberg on the company's earnings call.

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Speaker 5: We've had a strong start to the year. Our community

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Speaker 5: keeps growing, with more than three point four billion people

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Speaker 5: now using at least one of our apps each day.

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Speaker 5: Our business is also performing very well, and I think

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Speaker 5: we're well positioned to navigate the macroeconomic uncertainty.

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Speaker 3: And metic CEO Mark Zuckerberg said the company expects to

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Speaker 3: spend sixty four billion to seventy two billion dollars this year,

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Speaker 3: attributing some of the increase to tariffs imposed by the

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Speaker 3: Trump administration.

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Speaker 2: And Karen the tech earnings keep rolling Today. We will

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Speaker 2: hear from two more of the so called Magnificent seven

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Speaker 2: this afternoon, Apple and Amazon. Let's get an Apple preview

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Speaker 2: now from Bloomberg's Tom Busby.

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Speaker 6: Key for investors will be any insights into the future

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Speaker 6: impact of the Trump tariffs and the company's ongoing efforts

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Speaker 6: to catch up with rivals on artificial intelligence, something that

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Speaker 6: could risk its reputation and future sales.

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Speaker 7: Now.

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Speaker 6: Apple's heavy reliance on China for iPhone production has made

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Speaker 6: it particularly vulnerable to tariffs, and whether that exposure could

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Speaker 6: lead to price sikes or more production shifting to India

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Speaker 6: or elsewhere. Bloomberg consensus calls for revenue of ninety four

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Speaker 6: point sixty two billion dollars on earnings per share of

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Speaker 6: a dollar sixty two. Tom Busby Bloomberg Radio, All right.

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Speaker 3: Tom, thank you all staying in the tech world the

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Speaker 3: share of Tesla's denying your report. The board had looked

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Speaker 3: to replace chief executive Elon Musk. The Wall Street Journal

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Speaker 3: reported that Tesla board members had contacted executive search firms

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Speaker 3: to seek a successor to Musk earlier this year. According

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Speaker 3: to the paper, the director's approaches took place about a

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Speaker 3: month ago, as investors were concerned about the amount of

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Speaker 3: time Musk was devoting to his cost cutting role with

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Speaker 3: the government. On a post on Tesla's ex account chair,

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Speaker 3: Robin Denholms said quote, this is absolutely false and directors

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Speaker 3: are highly confident in musk stability.

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Speaker 2: Hearing there are new developments this morning to end the

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Speaker 2: war in Ukraine. The US has reached a deal over

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Speaker 2: Ukraine's natural resources. It'll get access to new investment projects

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Speaker 2: to develop things like aluminum, graphite, oil and natural gas Bloomberg.

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Speaker 2: Stan Flatley is in Washington on why this deal is

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Speaker 2: so important for Ukraine.

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Speaker 8: Essentially, what this is is a guarantee as far as

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Speaker 8: the Trump administration is concerned that the US will continue

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Speaker 8: to remain involved in Ukraine. Will help Ukraine achieve some

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Speaker 8: sort of equitable piece deal with Russia, if that's even

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Speaker 8: possible at this point.

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Speaker 2: But this deal is key Bloomberg. Stan Flatley says the

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Speaker 2: deal will create a fund to attract global investment into Ukraine.

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Speaker 2: The US would get first claim on profits transferred into

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Speaker 2: the fund, which would be jointly managed by both nations.

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Speaker 3: Meanwhile, Nathan in the Senate is looking to put new

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Speaker 3: pressure on Russia as ceasefire talks drag on. Republican Lindsey

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Speaker 3: Graham says he has brought support for what he calls

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Speaker 3: bone crushing sanctions if Russian President Vladimir Putin does not

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Speaker 3: get serious with the discussions. Graham's bill includes five hundred

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Speaker 3: percent tariffs on countries that purchase Russian energy and a

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Speaker 3: ban on US citizens buying Russia's sovereign debt. The South

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Speaker 3: Carolina Republican says Putin will have to choose between sitting

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Speaker 3: down with President Trump or watching his economy be crushed.

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Speaker 2: All right, Keren, Now let's get to the latest on

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Speaker 2: the trade war. President Trump says he is determined to

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Speaker 2: move ahead with his sweeping tariff plans, though he admits

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Speaker 2: it comes with a political risk.

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Speaker 9: It is true, and I just think that I'll be

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Speaker 9: able to convince people how good this is. This is

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Speaker 9: what other countries have done to us. We've been the

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Speaker 9: laughing stock and the whipping post. We've been ripped off

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Speaker 9: by every country practically in the world.

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Speaker 2: President Trump phoned into a News Nation town hall last

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Speaker 2: night after government figure showed the economy contracted in the

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Speaker 2: first quarter for the first time since twenty twenty two.

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Speaker 2: The president says much of the blame for that goes

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Speaker 2: to former President Joe Biden.

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Speaker 4: In that News Nation.

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Speaker 3: Town hall, Nathan the President said there's a very good

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Speaker 3: chance he'll strike a trade deal with China, but it

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Speaker 3: has to be on his terms. Host Bill O'Reilly asked

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Speaker 3: when he would announce deals with other trading partners like

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Speaker 3: South Korea, Japan, and India.

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Speaker 4: Well, we have.

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Speaker 9: Potential deals with them. Yeah, but I'm in okay, I'll

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Speaker 9: tell you this. I'm in less of a hurry than

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Speaker 9: you are. We are sitting on the cat bird seat.

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Speaker 9: They want us, we don't need them.

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Speaker 3: Meanwhile, state run media and China are reporting the US

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Speaker 3: has reached out to Beijing to try to kickstart trade

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Speaker 3: talks through various channels. President Trump has repeatedly said Chinese

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Speaker 3: President Xijin Ping needs to make the first move.

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Speaker 2: And Karen, the global trade war is impacting monetary policy overseas.

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Speaker 2: The Bank of Japan is pushing back the timing for

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Speaker 2: when it expects to reach its two percent inflation target.

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Speaker 2: JAYS also slashing its growth forecast. Says the global trade

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Speaker 2: war darkens the economic outlook, and checking the Japanese yen

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Speaker 2: right now, it is weaker against the dollar, down about

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Speaker 2: three quarters of one percent at one forty four point

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Speaker 2: one six.

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Speaker 3: It's time now for look at some of the other

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Speaker 3: stories making news in New York and around the world,

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Speaker 3: and for that we're joined by Bloomberg's Michael Barr Michael,

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Speaker 3: Good Morning.

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Speaker 7: Good Morning Care and former Vice President Kamala Harris used

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Speaker 7: a high profile speech in San Francisco to deliver a

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Speaker 7: sharp edged critique of President Donald Trump, accusing him of

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Speaker 7: wholesale abandonment of American ideals. Last night's speech was Harris'

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Speaker 7: most extensive public remarks since leaving office in January.

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Speaker 10: We are living in a moment when the checks and

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Speaker 10: balances upon which we have historically relied have begun to buckle.

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Speaker 7: The speech comes as Harris is not ruled out or

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Speaker 7: run for California governor or another White House try. The

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Speaker 7: US urged India and Pakistan to work together to de

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Speaker 7: escalate tensions and avoid a clash after militants killed dozens

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Speaker 7: of people in Indian controlled Kashmir last week. Relations between

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Speaker 7: India and Pakistan have rapidly deteriorated, with India accusing Pakistan

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Speaker 7: of involvement in the attack, Pakistan denying any links. A

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Speaker 7: Columbia University student arrested during his citizenship interview was released

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Speaker 7: yesterday by a federal judge in Vermont. Outside the courthouse, motion,

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Speaker 7: mcdowi said that he is not afraid of President Trump.

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Speaker 1: He has made a very brave decision to let me out.

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Speaker 11: And this is what justice is.

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Speaker 8: And for anybody who's doubting justice, this is a life

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Speaker 8: of hope.

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Speaker 7: The judge said. Mcdawi has not been charged with a crime.

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Speaker 7: Linda Drewby, one of mcdowi's attorneys, said her client is

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Speaker 7: feeling shocked and proud to see justice.

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Speaker 11: The court told the government that they can and not

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Speaker 11: detained individuals solely because they're engaged in lawful speech, and

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Speaker 11: that's exactly what mister macdowie was engaged in.

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Speaker 7: Mcdowie is allowed to occasionally go to New York City

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Speaker 7: to finish up his studies at Columbia In upstate New York,

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Speaker 7: the Onondaga County District Attorney says eleven teenagers a part

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Speaker 7: of the West Hill High School men's lacrosse team have

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Speaker 7: turned themselves in for a hazing incident that means they'll

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Speaker 7: be spared from facing more serious charges. The DA says

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Speaker 7: they hazed younger team members, ambushing them with an apparent

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Speaker 7: gun and knife pointed at one of them before he

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Speaker 7: was thrown into the back of a car. Global News

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Speaker 7: twenty four hours a day and whenever you want it

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Speaker 7: with the Bloomberg News. Now Michael barrn this is Bloomberg Karen.

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Speaker 3: All right, Michael barr thank you time now for the

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Speaker 3: Bloomberg Sports Update. Here's John Stanshauer. John, Good morning, morning, Dann.

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Speaker 12: The Yankees finished the series in Baltimore the night after

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Speaker 12: hitting six home runs, four in the first then in

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Speaker 12: another first Jitning homer.

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Speaker 2: It was hit for the Yankee captain Hi Josh centerfield.

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Speaker 4: Holland's back track.

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Speaker 6: See what a shot?

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Speaker 4: What your run?

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Speaker 3: Home?

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Speaker 2: One for Judge in his personal play Pat two nothing.

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Speaker 12: Yes, yes, never to call Aaron Judge's twenty sixth career

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Speaker 12: homer at Camden Yards, and he had two more hits.

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Speaker 12: Finished April with a batting average of four to twenty seven,

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Speaker 12: but the game ended with Judge on deck, couldn't get

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Speaker 12: to the plate with the Yanks trailing by iran. Baltimore

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Speaker 12: won five to four, took two of three in the series,

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Speaker 12: only the second time the Mets have lost in City Field.

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Speaker 12: The ninth Enning Valley fell short. Arizona won four to three.

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Speaker 12: Red Sox lost seven to six ten innings at Toronto.

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Speaker 12: National's lost seven two in Philadelphia. Win for Colorado two

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Speaker 12: one over Atlanta. Rockies finished April five and twenty five,

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Speaker 12: most losses on May first in MLV history. At the

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Speaker 12: seventh inning of the Cubs game in Pittsburgh, a fan

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Speaker 12: fell from the stands landed on the warning track in

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Speaker 12: right field.

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Speaker 7: He's in the.

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Speaker 12: Hospital in critical condition. Season for the Lakers, they go

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Speaker 12: out scoring only sixteen points in the fourth quarter in

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Speaker 12: a one oh three ninety six home loss to Minnesota,

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Speaker 12: who won the series four games to one. For the Timberwolves,

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Speaker 12: Rudy Gobert twenty seven points twenty four rebounds, both their

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Speaker 12: career playoff highs Houston Mcgolden State one thirty one, one sixteen,

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Speaker 12: the Warriors are still up three to two. The Knicks

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Speaker 12: are up three too going to Game six tonight in Detroit.

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Speaker 12: The Nicks hoping to follow the path of last year's

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Speaker 12: first round, when they also failed to win the series

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Speaker 12: at home in Game five, but won a Game six

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Speaker 12: that was in Philadelphia, Washington and Florida. Moving on, Stanley

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Speaker 12: Cup playoffs, Capitals beat Montreal four to one. Panthers won

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Speaker 12: six to three at Tampa Bay. Both won their series

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Speaker 12: in five. Winnipeg beat Saint Louis five to three. John

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Speaker 12: Stanstedward Bloomberg Sports Kearny Nathan.

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Speaker 1: Coast to Coast on Bloomberg Radio, nationwide on Sirius XM,

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Speaker 1: and around the world on Bloomberg dot Com and The

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Speaker 1: Bloomberg Business app. This is Bloomberg Day Break.

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Speaker 2: Good morning, I'm Nathan Hager. On a very busy week

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Speaker 2: for big tech earnings. It is getting off to a

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Speaker 2: solid start, strong earnings from Microsoft and meta platforms, even

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Speaker 2: with uncertainty around trade. Here to break it down for

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Speaker 2: us this morning, Bloomberg Markets reporter Valerie Titel. Val great

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Speaker 2: to have you with us. Let's start with Microsoft, since

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Speaker 2: it's seeing the slightly bigger move in the pre market.

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Speaker 2: Investors there wanted to see whether the demand is still

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Speaker 2: holding up for AI and the cloud, and it looks

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Speaker 2: like Microsoft delivered. And then some good morning, Good.

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Speaker 10: Morning, Nathan, Yes, Microsoft delivered, and then some shares are

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Speaker 10: jumping eight percent in the pre market. Beats across the

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Speaker 10: board revenue, cloud sales, and also a bullish projection over

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Speaker 10: its cloud business. Investors were also very welcome to see

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Speaker 10: that it tapped the brakes on capex for the first

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Speaker 10: time in ten quarters. Investors really like that prudence with

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Speaker 10: that stock soaring up this morning, Let's focus in on

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Speaker 10: the cloud business because sales there unexpectedly strong, up thirteen percent.

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Speaker 10: The cloud business called Azure grew thirty three percent in

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Speaker 10: the quarter, and they said that in the next quarter,

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Speaker 10: they are predicting thirty five percent growth that was well

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Speaker 10: above estimates. Profits were also up eighteen percent from the

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Speaker 10: same period last year, and almost half of their growth

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Speaker 10: in that cloud business came from AI services. So it

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Speaker 10: seems like all that expenditure on artificial intelligence is paying

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Speaker 10: off and then some. For Microsoft, those shares are up

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Speaker 10: eight point two percent pre market.

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Speaker 2: And interesting to see that they have this sort of

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Speaker 2: bullish forecast around demand for further AI growth. Could that

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Speaker 2: hold up if these trade uncertainties continue? How is Microsoft

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Speaker 2: saying it's going to navigate that?

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Speaker 6: Look?

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Speaker 10: Microsoft definitely, in the context of the fact that they

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Speaker 10: are continuing to spend, continuing to invest, is showing that

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Speaker 10: they are expected to get returns for this additional expenditure.

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Speaker 10: You know, Meta also said the same thing. They forecasted

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Speaker 10: additional spending on the back of this. So even though

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Speaker 10: all of this uncertainty is overhanging, we're still seeing companies

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Speaker 10: in big tech investing further and I think that is

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Speaker 10: a bullish thing for US megacap tech.

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Speaker 2: Now turning two. Meta, as you say, the spending there

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Speaker 2: is continuing as well, and it looks like the AD

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Speaker 2: business is holding up to sort of support that spending

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Speaker 2: as well.

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Speaker 10: Yeah, Meta jumping six point one percent so far pre

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Speaker 10: market trade. They really did calm investor nerves about the

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Speaker 10: impact of Trump's trade war on advertising sales. Advertising is

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Speaker 10: a very cyclical business. Somewhere worried that they might have

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Speaker 10: seen advertisers pull back on ad spend given all the uncertainty,

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Speaker 10: but they reported a first quarter revenue that beat expectations.

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Speaker 10: Ninety eight percent of their revenue comes from advertising, so

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Speaker 10: they did not show an advertising pullback. They also forecasted

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Speaker 10: additional spending as I said, and they anticipated continued growth

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Speaker 10: despite the tariffs. They also showed that the investment in

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Speaker 10: AI is paying off for them too. They showed that

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Speaker 10: AI is helping to improve ad targeting and personalization on

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Speaker 10: the content people see on its social media network. So

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Speaker 10: another bullish narrative coming out of Meta. Those shares are

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Speaker 10: up six and a quarter percent.

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Speaker 2: Yeah, I guess it has to be said, Valerie that

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Speaker 2: just the fact that both these companies are even giving

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Speaker 2: guidance as a Polish sign is so much of what

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Speaker 2: we've heard from so many other companies. So in our

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Speaker 2: last minute or so, what does that tell us about

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Speaker 2: what we could expect later today when we hear from

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Speaker 2: Amazon and Apple after the closing bell.

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Speaker 10: I do think the risk is here, Nathan. We might

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Speaker 10: get a different narrative because the narrative coming out of

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Speaker 10: both Apple and Amazon is their heavy reliance on China.

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Speaker 10: We know that Apple's you know, iPhone supply chain is

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Speaker 10: very intertwined in China. Amazon has a lot of retail

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Speaker 10: logistics and advertisers that come from China as well, So

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Speaker 10: we might get a bit different picture painted by these

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Speaker 10: two other mag seven's that report later tonight, So watch

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Speaker 10: out for those any comments about them shifting their supply

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Speaker 10: chains updating on pricing as well. We'll be watching out

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Speaker 10: for those kind of warnings with Apple and Amazon later.

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Speaker 2: It's interesting to think about in our last minute of

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Speaker 2: there could be sort of a fracturing of the Magnificent

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Speaker 2: seven based just on where the supply chains are coming from.

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Speaker 10: Yeah, exactly, And you have to have to account for

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Speaker 10: the fact that Apple and Amazon, you know, they're retailers

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Speaker 10: of hard goods which are struggling with these tariffs. So

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Speaker 10: you're right, we might see a bifurcation happen between tech

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Speaker 10: those who are more focused on the shipments of goods

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Speaker 10: versus the sell of software that could see some bifurcation

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Speaker 10: between those two corporates, that saying very good point.

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