WEBVTT - Alphabet Rallies on AI Bet; Yankees Avoid Elimination

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

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<v Speaker 2>Good morning.

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<v Speaker 1>I'm Nathan Hager and I'm Karen Moscow. Here are the

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<v Speaker 1>stories we're following today, Karen.

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<v Speaker 2>If the futures are any indication this morning, the Nansdack

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<v Speaker 2>could hit another record close today. Alphabet is the main catalyst.

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<v Speaker 2>Those shares are hired by nearly six percent. This morning,

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<v Speaker 2>the Google parent showed its expensive foray into artificial intelligence

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<v Speaker 2>is starting to pay off in earnings that delivered better

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<v Speaker 2>than expected traction for its cloud computing business and drove

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<v Speaker 2>more usage to its flagship search engine. Alphabet Chief executive

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<v Speaker 2>Officer Sun Darpachai talked about the cloud on the company

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<v Speaker 2>conference call.

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<v Speaker 3>I'm very pleased without growth, this business is real momentum

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<v Speaker 3>and the overall opportunity is increasing as customers embraced Jenai.

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<v Speaker 3>We generated Q three revenues of eleven point four billion dollars,

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<v Speaker 3>thirty five percent over last year, with operating margins of

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<v Speaker 3>seventeen percent.

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<v Speaker 2>Alphabet CEO Soon Darpachai says overall revenue and profit exceeded expectations.

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<v Speaker 2>Revenue reached seventy four point six billion dollars.

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<v Speaker 1>Well, Nathan, alphabeta gains this morning pale in comparison to Reddit.

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<v Speaker 1>Those shares are at an all time high, surging twenty

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<v Speaker 1>two and a half percent. The social network operator, which

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<v Speaker 1>when public in March, reported sales and a forecast that

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<v Speaker 1>topped analyst estimates.

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<v Speaker 2>On the flip side here and shares of advanced micro

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<v Speaker 2>devices are tumbling this morning. They're down more than eight percent.

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<v Speaker 2>The chip maker's revenue forecast missed analyst estimates. They say

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<v Speaker 2>it's a sign, am, these artificial intelligence sales are growing

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<v Speaker 2>more slowly than anticipated.

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<v Speaker 1>Well, Nathan will have more on earnings and the markets

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<v Speaker 1>in just a minute, but now let's get you updated

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<v Speaker 1>on the World Series. There will be a Game five

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<v Speaker 1>tonight as the Yankees stay of off elimination Bloomberg. John

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<v Speaker 1>stash Hour is here with the very latest, John, all right.

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<v Speaker 4>Hearing the Yankees. We're face seen in the elimination in

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<v Speaker 4>World Series. Game four began yet again with a first

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<v Speaker 4>inning to run homer by the red hot Dodger Freddie Freeman,

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<v Speaker 4>but the Yanks load of the bases in the third inning.

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<v Speaker 5>Faces loaded two out.

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<v Speaker 2>Crisp Fucker redention.

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<v Speaker 4>Fox Sports to call on Anthony Valpi Grant's lam Yanks

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<v Speaker 4>pulled away. Added home runs by Austin Wells. Labor Torre

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<v Speaker 4>stayed alive with in eleven of four, still trail the

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<v Speaker 4>series three to one. John Stashiewa Bloomberg.

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<v Speaker 1>Sports All right, John, thank you well. John. We'll be

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<v Speaker 1>back with us in a few minutes for more details

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<v Speaker 1>and postgame reaction from Game four the World Series.

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<v Speaker 2>Now, Karen, let's get to the latest from the presidential race.

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<v Speaker 2>Kamala Harris delivered her closing argument against Donald Trump with

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<v Speaker 2>a major speech at Washington, DC's Ellipse.

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<v Speaker 6>We know who Donald Trump is. He is the person

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<v Speaker 6>who stood at this very spot nearly four years ago

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<v Speaker 6>and sent an armed mob to the United States cap

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<v Speaker 6>to overturn the will of the people in a free

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<v Speaker 6>and fair election.

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<v Speaker 2>The vice president cast the race as a choice between

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<v Speaker 2>freedom for every American or chaos and division. She said

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<v Speaker 2>her presidency would be different from President Biden's.

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<v Speaker 6>Our top priority as a nation four years ago was

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<v Speaker 6>to end the pandemic and rescue the economy. Now, our

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<v Speaker 6>biggest challenge is to lower costs, costs that were rising

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<v Speaker 6>even before the pandemic and that are still too high.

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<v Speaker 2>Kamala Harris promised to prosecute price goungers, and she outlined

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<v Speaker 2>her plans for tax breaks for new parents, startup businesses,

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<v Speaker 2>and first time home buyers. The Harris campaign estimates more

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<v Speaker 2>than seventy five thousand people turned out for the speech

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<v Speaker 2>one week before the election.

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<v Speaker 1>Oh Meantime, Nathan Donald Trump held a rally last night

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<v Speaker 1>in Allentown, Pennsylvania, as he continues to face a backlash

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<v Speaker 1>over anti immigrant comments at Madison Square Garden last weekend.

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<v Speaker 1>President Biden's seized on the joke that Puerto Rico is

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<v Speaker 1>a floating island of garbage on a call with Latino

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<v Speaker 1>voters last night.

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<v Speaker 2>Only garbage I see floating down there as his supporters.

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<v Speaker 3>His demonizational scene is unconscionable, and it's on America.

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<v Speaker 1>Former President Trump seized on that.

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<v Speaker 7>Remember Hillary, she said deplorable and then she said irredeemable.

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<v Speaker 2>Right, but she said deplorable.

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<v Speaker 7>That didn't work out.

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<v Speaker 8>Garbage, I think is worse right.

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<v Speaker 3>But he doesn't know.

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<v Speaker 8>You have to please forgive him, Please forgive him, for

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<v Speaker 8>he not knoweth.

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<v Speaker 3>What he said.

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<v Speaker 1>Later, President Biden posted on x that he meant to

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<v Speaker 1>say trump supporters rhetoric was garbage. Later today, the Harris

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<v Speaker 1>campaign will run through the battleground states of North Carolina, Pennsylvania,

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<v Speaker 1>and Wisconsin. Trump has a rally today in Green Bay, Wisconsin,

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<v Speaker 1>featuring legendary Packers quarterback Brett Farv.

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<v Speaker 2>Turning back to markets now, Karen Ubs posted a profit

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<v Speaker 2>of one point four billion dollars in the third quarter,

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<v Speaker 2>nearly double what analysts predicted. The Swiss lenders key wealth

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<v Speaker 2>management unit and its investment bank both outperformed. In an

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<v Speaker 2>interview with Bloomberg, UBS CEO Sergio or Mahdi warned of

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<v Speaker 2>headwinds ranging from the US elections to falling interest income.

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<v Speaker 9>Well, I think that the US election for sure won't

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<v Speaker 9>be uneventful. I think that right now markets the markets

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<v Speaker 9>are pricing a Trump victory and think that if this

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<v Speaker 9>is confirmed in the remains to be seen is a

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<v Speaker 9>classical sale of news event.

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<v Speaker 2>UBS CEO Sergio or Mahdi spoke with Bloomberg's Francy Laqua.

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<v Speaker 2>Switzerland's largest bank is still working through the integration of

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<v Speaker 2>former rival Credit Suites, which it took over last year

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<v Speaker 2>in an emergency rescue.

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<v Speaker 1>Well Nathan, Europe's biggest automaker of Volkswagen, saw its operating

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<v Speaker 1>margin shrink to its lowest since the COVID pandemic. VW's

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<v Speaker 1>earnings could boost management's case for drastic measures. In Germany,

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<v Speaker 1>labor leaders are resisting plans to close at least three

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<v Speaker 1>factories and eliminate thousands of jobs.

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<v Speaker 2>And back here in the US here and there's some

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<v Speaker 2>optimism this morning. At Boeing, efforts have resumed to end

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<v Speaker 2>the planemaker's seven week strike. Acting Labor Secretary Julie Sue

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<v Speaker 2>says both sides held fruitful talks yesterday. The work stoppage

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<v Speaker 2>for more than thirty three thousand union is taking a

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<v Speaker 2>toll on Boeing instead of generating cash. In the fourth quarter,

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<v Speaker 2>the company now expects to burn through around four billion dollars.

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<v Speaker 2>Time now for look at some of.

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<v Speaker 1>The other stories making news in New York and around

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<v Speaker 1>the world. For that, we're joined by Bloomberg's Michael Barr Michael,

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<v Speaker 1>Good morning, Good.

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<v Speaker 5>Morning, Karen. Local and federal officials continue to search for

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<v Speaker 5>a suspect believed to have set to ballot drop boxes

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<v Speaker 5>on fire Monday in Oregon and Washington. Last week. Authorities

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<v Speaker 5>in Phoenix say a number of ballots were damaged when

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<v Speaker 5>a US Post Office collection mailbox was lit on fire.

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<v Speaker 5>This all comes as the FBI and Department of Homeland

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<v Speaker 5>Security warn election related grievances, such as a belief in

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<v Speaker 5>voter fraud, could motivate domestic extremists to engage in violence

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<v Speaker 5>before and after the election. In battleground Arizona, Maricoba County

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<v Speaker 5>Sheriff Russ Skinner says they'll have zero tolerance when it

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<v Speaker 5>comes to criminal activity related to the election.

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<v Speaker 8>It's one thing for First Amendment, one thing to express

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<v Speaker 8>your opinion. It's another when there's threatening or other violence

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<v Speaker 8>that gets centered around this and it's not going to

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<v Speaker 8>happen here in Maricopa County.

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<v Speaker 5>Meanwhile, Jeff Ellington heads run Back election Services. A growing

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<v Speaker 5>part of its business is now election security.

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<v Speaker 2>We recently started selling panic bobs to counties because of

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<v Speaker 2>all the threats to poll workers.

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<v Speaker 5>The devices are connected to nine point one. Ellington says

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<v Speaker 5>they have sold around one thousand to different counties. Former

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<v Speaker 5>Trump's strategist Steve Bennon says that his time in prison

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<v Speaker 5>galvanized him, and he repeated false claims that the twenty

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<v Speaker 5>twenty election was stolen from former President Trump. Speaking at

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<v Speaker 5>a news conference in New York. Bannon also said he

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<v Speaker 5>is committed to helping with letting out the vote and

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<v Speaker 5>recruiting poll workers and ballot counters in swaying states. We

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<v Speaker 5>need to get people in the counting rooms.

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<v Speaker 2>We need to get people around the tables to do

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<v Speaker 2>ballot churing. Okay, So there's still need for that, So

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<v Speaker 2>we're gonna.

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<v Speaker 5>Call for that. Bannon was released Tuesdays, serving four months

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<v Speaker 5>at the Danbury Federal Correctional Institution in Connecticut for defying

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<v Speaker 5>a congressional subpoena from the investigation into the January sixth

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<v Speaker 5>attack at the Capitol. The man who broke into the

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<v Speaker 5>home of former House Speaker Nancy Pelosi in twenty twenty

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<v Speaker 5>two and attacked her husband with a hammer has been

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<v Speaker 5>given another prison sentence for the attack. As Judge Harry

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<v Speaker 5>Dorfman was handing down David to PAP's state sentence, Dorfman

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<v Speaker 5>said it was his intention that the pap never get

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<v Speaker 5>out of prison. It gives the PAP life in prison

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<v Speaker 5>without the chance of parole. The sentences on top of

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<v Speaker 5>a thirty year federal prison term. Global News twenty four

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<v Speaker 5>hours a day and whenever you want it with Bloomberg

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<v Speaker 5>News now Michael Barn, This is Bloomberg Karen.

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<v Speaker 1>All right, Michael Barr, thank you time now for the

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<v Speaker 1>Bloomberg Sports Update, brought to you by try Staate Oudie.

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<v Speaker 1>Here is John stash Hour again. Good morning John, Good

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<v Speaker 1>morning care.

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<v Speaker 4>And it was that Freddie Freeman walk off Grand Slam

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<v Speaker 4>in Game one that turned this World Series in the

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<v Speaker 4>Dodgers direction. They won three straight games. The Yankees are

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<v Speaker 4>hoping the slam hit it in the third inning of

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<v Speaker 4>Game four by Anthony Volpe does the same for them.

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<v Speaker 4>Gave the Yanks to five to two lead. Dodgers got

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<v Speaker 4>it to five to four, but Austin Wells, who had

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<v Speaker 4>been buried in a deep slump, hit a solo shot

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<v Speaker 4>at the Yanks put the game away in the eighth inna.

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<v Speaker 2>Driven the other way deep ut centerfield.

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<v Speaker 4>xCT Fox Sports to call of the Glaber Torres three

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<v Speaker 4>run homer. Yanks won eleven four, still three to one down.

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<v Speaker 4>It's a long way to go to win the series.

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<v Speaker 4>But Aaron Boone happy. He'll be back at the stadium tonight.

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<v Speaker 7>We just showed up today ready to play, and you

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<v Speaker 7>know we're trying to get one, you know, and trying

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<v Speaker 7>to trying to get the gate, trying to get it

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<v Speaker 7>to tomorrow. You know, you know, you don't even get

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<v Speaker 7>ahead of yourself and start thinking about the series. It's

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<v Speaker 7>like our guys were ready to play. Obviously a lot

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<v Speaker 7>of really good at bats, you know. Volpi with a

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<v Speaker 7>big blow.

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<v Speaker 4>Good Tonight starts his as Garrett Coles. He Yanks to

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<v Speaker 4>try to get the series back to La. The White Sox,

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<v Speaker 4>named Texas coach Will Venable, their new manager, takes over

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<v Speaker 4>a team that just had the worst season in MLB history,

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<v Speaker 4>and Barkley's too much.

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<v Speaker 5>Da Kola Jokic.

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<v Speaker 4>Twenty nine points, eighteen rebounds, sixteen assists denverby the Nets

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<v Speaker 4>one nine in overtime. Rangers lost five to three and

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<v Speaker 4>Washington two goals for Alex Ovechkin thirty eight more and

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<v Speaker 4>he breaks Wayne Gretzky's record for most goals in NHL history.

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<v Speaker 4>Islanders lost to Anaheim three to one for ruin shut

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<v Speaker 4>out by Philadelphia two to nothing. Quarterback change in Indianapolis,

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<v Speaker 4>the Colts benching twenty two year old Anthony Richardson. They'll

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<v Speaker 4>start thirty nine year old Joe Flacco. The PGA Tours

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<v Speaker 4>Advisory Council recommending changes that would begin in twenty twenty six.

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<v Speaker 4>They include a reduction in the field size for some

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<v Speaker 4>tournaments players who had a better chance.

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<v Speaker 1>Of completing their runt.

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<v Speaker 4>John Stashedwad of Bloomberg Sports, Karen and Me.

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<v Speaker 2>Coast to Coast on Bloomberg Radio nationwide on Sirius XM,

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<v Speaker 2>and around the world on Bloomberg dot Com and the

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<v Speaker 2>Bloomberg Business app. This is Bloomberg Daybreak. Good morning, I'm

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<v Speaker 2>Nathan Hager. Artificial intelligence maybe starting to pay off. That

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<v Speaker 2>could be the biggest takeaway from the biggest of the

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<v Speaker 2>big tech companies that supported earnings so far this week,

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<v Speaker 2>Google parent Alphabet posted solid results all around after all

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<v Speaker 2>the spending it's done on AI. Here to break down

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<v Speaker 2>the numbers for us is Bloomberg's Valerie Titel Valerie good morning.

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<v Speaker 2>Looks like solid results all around on the main metrics.

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<v Speaker 10>Yeah, great story from Alphabet. They reported healthy gains in

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<v Speaker 10>both revenue and profit. As that companies, you know, their

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<v Speaker 10>big bet on AI really showed signs of paying off

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<v Speaker 10>in their results last night. Revenue excluding partner payouts increased

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<v Speaker 10>to seventy four point six billion. It's upset sixteen percent

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<v Speaker 10>year and year and ahead of the average analyst expectations

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<v Speaker 10>of seventy two point nine billion. Net income was also

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<v Speaker 10>a beat on expectations. It was at two dollars and

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<v Speaker 10>twelve cents per share, compared with estimates of one dollar

0:12:12.600 --> 0:12:16.959
<v Speaker 10>and eighty four cents per share. Excuse me, As its

0:12:17.280 --> 0:12:20.680
<v Speaker 10>main search business matures, Googles really looks for other ways

0:12:21.400 --> 0:12:23.719
<v Speaker 10>to get revenue, and most that has been focused on

0:12:23.840 --> 0:12:26.800
<v Speaker 10>its cloud division. It's a big bet on AI and

0:12:27.480 --> 0:12:31.079
<v Speaker 10>the Google's sales actually reached a new high for the

0:12:31.160 --> 0:12:34.080
<v Speaker 10>third quarter, and the sales specifically in the cloud division

0:12:34.280 --> 0:12:36.920
<v Speaker 10>jumped to eleven point four billion. It's a thirty five

0:12:36.960 --> 0:12:39.600
<v Speaker 10>percent rise from a year ago and better than analysts

0:12:39.600 --> 0:12:43.559
<v Speaker 10>across the street had projected. Now, the CEO said the

0:12:43.679 --> 0:12:47.400
<v Speaker 10>numbers are encouraging. In a letter to investors last night,

0:12:47.679 --> 0:12:50.319
<v Speaker 10>he said, our cloud AI solutions are helping drive a

0:12:50.400 --> 0:12:54.240
<v Speaker 10>deeper product adoption with the existing customers and attract new

0:12:54.320 --> 0:12:57.719
<v Speaker 10>customers and win larger deals. Now, Google does have the

0:12:57.960 --> 0:13:03.480
<v Speaker 10>negativity of the US antitrust litigation weighing on it, and

0:13:03.679 --> 0:13:05.920
<v Speaker 10>in that same note, the CEO did warn that the

0:13:06.000 --> 0:13:08.559
<v Speaker 10>US government's resolution of that anti trust case could have

0:13:08.720 --> 0:13:12.480
<v Speaker 10>quote unintended consequences for US leadership and tech. So a

0:13:12.520 --> 0:13:15.559
<v Speaker 10>bit of warning there to the Justice Department on that litigation.

0:13:15.720 --> 0:13:19.160
<v Speaker 10>But overall, very positive results from Alphabet based on that

0:13:19.400 --> 0:13:21.839
<v Speaker 10>growth in the cloud services. Those shares are a five

0:13:21.920 --> 0:13:23.440
<v Speaker 10>point four percent pre market trade.

0:13:23.840 --> 0:13:27.120
<v Speaker 2>So after those results and the revenue beat on the

0:13:27.240 --> 0:13:30.000
<v Speaker 2>cloud where is the bar now? What is the run

0:13:30.120 --> 0:13:33.440
<v Speaker 2>rate for AI monetization for Google going forward?

0:13:33.920 --> 0:13:36.880
<v Speaker 10>Well, look, it still really does. It's Google is the

0:13:37.080 --> 0:13:41.000
<v Speaker 10>third in the market for cloud services, alongside Amazon and Microsoft,

0:13:41.080 --> 0:13:44.080
<v Speaker 10>who are a bit ahead of it in that sector.

0:13:44.200 --> 0:13:46.520
<v Speaker 10>But analysts do see that there is room to grow

0:13:46.600 --> 0:13:48.360
<v Speaker 10>and they are positive on it. This is really a

0:13:48.400 --> 0:13:51.160
<v Speaker 10>step in the right direction. What we saw from Alphabet

0:13:51.240 --> 0:13:53.800
<v Speaker 10>in their earnings yesterday that this big bet, this big

0:13:53.920 --> 0:13:56.480
<v Speaker 10>investment is starting to pay off and that they can

0:13:57.200 --> 0:14:00.280
<v Speaker 10>move away from their AD revenue from their main search

0:14:00.360 --> 0:14:02.080
<v Speaker 10>business and find a new avenue for growth.

0:14:03.080 --> 0:14:05.079
<v Speaker 2>But you get have a different story this morning for

0:14:05.360 --> 0:14:08.440
<v Speaker 2>Advanced micro Device is that it's the forecast that really

0:14:08.480 --> 0:14:11.319
<v Speaker 2>seems to be the weight on that stock this morning.

0:14:11.800 --> 0:14:16.720
<v Speaker 10>Yeah, their revenue forecasts from AMD really missed the analyst estimate,

0:14:16.840 --> 0:14:20.320
<v Speaker 10>and it's a sign that it's artificial intelligence sales are

0:14:20.360 --> 0:14:23.640
<v Speaker 10>growing more slowly than some had anticipated. It sparked a

0:14:23.960 --> 0:14:27.160
<v Speaker 10>eight percent drop in the share in post market trade.

0:14:27.160 --> 0:14:29.400
<v Speaker 10>It's continuing to hold that in the pre market as well.

0:14:29.840 --> 0:14:33.200
<v Speaker 10>That's a racing nearly half of the AMD's gains on

0:14:33.560 --> 0:14:38.720
<v Speaker 10>the year. So, despite growing AI accelerator sales, AMD still

0:14:38.880 --> 0:14:43.240
<v Speaker 10>lags decently behind Navidia in the lucrative market, with its

0:14:43.280 --> 0:14:46.000
<v Speaker 10>sales expected to reach only five billion this year. I

0:14:46.080 --> 0:14:49.200
<v Speaker 10>say only five billion because you look at Navidia's AS sales.

0:14:49.280 --> 0:14:52.160
<v Speaker 10>They trump that in multiple But on a conference call

0:14:52.480 --> 0:14:56.560
<v Speaker 10>following the results, the CEO pushback on concerns that AMD

0:14:56.720 --> 0:14:59.720
<v Speaker 10>isn't delivering enough growth, saying the company is ramping up

0:14:59.720 --> 0:15:03.200
<v Speaker 10>product and earning the trust of large data center companies

0:15:03.240 --> 0:15:05.480
<v Speaker 10>that do rely on AI accelerators.

0:15:05.760 --> 0:15:07.680
<v Speaker 2>So, on our last minute val how does this set

0:15:07.760 --> 0:15:10.320
<v Speaker 2>us up for the other big tech companies that are

0:15:10.360 --> 0:15:13.720
<v Speaker 2>going to be reporting today, Microsoft in particular, I have

0:15:13.840 --> 0:15:16.320
<v Speaker 2>to think has a lot of scrutiny around it on AI.

0:15:17.440 --> 0:15:21.200
<v Speaker 10>Yeah, we hear from Microsoft and Meta later today, that

0:15:21.240 --> 0:15:22.920
<v Speaker 10>would be after the bell. But also I want to

0:15:23.000 --> 0:15:25.440
<v Speaker 10>just touch on Reddit briefly. Those sares are surging twenty

0:15:25.480 --> 0:15:29.680
<v Speaker 10>two percent after the company sales and forecast beat expectations.

0:15:29.760 --> 0:15:32.000
<v Speaker 10>You know, this is a share that went public only

0:15:32.200 --> 0:15:34.840
<v Speaker 10>just past March, and it's now three trading nearly three

0:15:34.960 --> 0:15:37.280
<v Speaker 10>times it's ibo price, So a lot of positivity around

0:15:37.280 --> 0:15:39.800
<v Speaker 10>Reddit shares falling through the pre market trade. They're up

0:15:39.800 --> 0:15:40.560
<v Speaker 10>twenty two percent.

0:15:42.040 --> 0:15:44.960
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