Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.
Speaker 2: Good morning.
Speaker 3: I'm Nathan Hager and I'm Karen Moscow. Here are the
Speaker 3: stories we're following today.
Speaker 4: Karin, the market continues to react to big tech earnings
Speaker 4: we got after the closing bell. This morning's shares of
Speaker 4: Meta platforms are surging seven and a half percent. The
Speaker 4: Facebook owner top projections for holiday quarter revenue and gave
Speaker 4: a strong forecast for the current period. That's offsetting concerns
Speaker 4: about plans for unprecedented spending on artificial intelligence this year.
Speaker 4: Here's met A CEO, Mark Zuckerberg on the earnings conference call.
Speaker 5: I think that twenty twenty six is going to be
Speaker 5: the year that AI starts to dramatically change the way
Speaker 5: that we work. As we navigate this, our north star
Speaker 5: is building the best place for individuals to make a
Speaker 5: massive impact. So to do this, we're investing in AI
Speaker 5: native tooling so individuals at Meta can get more done.
Speaker 5: We're elevating individual contributors and flattening teams. We're starting to
Speaker 5: see projects that used to require big teams now be
Speaker 5: accomplished by a single, very talented person.
Speaker 4: Mark Zuckerberg says Meta plans to spend as much as
Speaker 4: one hundred and thirty five billion dollars this year on AI.
Speaker 3: Meanwhile, Nathan at Microsoft, spending surge to a record high
Speaker 3: while cloud sales growth slowed. That has shares a Microsoft
Speaker 3: down more than six percent this morning. Capital expenditures for
Speaker 3: the fiscal second quarter hit thirty seven and a half
Speaker 3: billion dollars. That's up sixty six percent from a year ago.
Speaker 3: And your CEO Satya Nadella on the company conference call.
Speaker 6: We are in the beginning phases of AI diffusion and
Speaker 6: its broad GDP impact. Our TAM will grow substantially across
Speaker 6: every layer of the tech stack as this diffusion accelerates
Speaker 6: and spreads. In fact, even in those early innings, we're
Speaker 6: built an AI business that is larger than some of
Speaker 6: our biggest franchises that took decades to build.
Speaker 3: CEO Satya Nadella says total sales increase seventeen percent and
Speaker 3: more than eighty one billion dollars in the quarter.
Speaker 4: Man Karen, we're watching shares of Tesla this morning. They're
Speaker 4: up more than two and a half percent in early trading.
Speaker 4: The ev maker reported earnings above analyst estimates, and in
Speaker 4: Tesla's call with analysts CEO Elon Musk said the company
Speaker 4: is discontinuing the Model S and X.
Speaker 7: It's time to basically bring the Model S and X
Speaker 7: programs to an end with an honorable discharge because we're
Speaker 7: really moving into a future that is based on autonomy.
Speaker 4: Elon Musk says Tesla plans to spend twenty billion dollars
Speaker 4: this year to streamline its electric vehicle lineup and shift
Speaker 4: resources toward robotics and AI.
Speaker 3: Nathan more news this morning on the AI front. The
Speaker 3: information is reporting in video Microsoft and Amazon are in
Speaker 3: discussions to invest as much as sixty billion dollars in
Speaker 3: open ai as part of a major new funding round.
Speaker 3: This could help alleviate investor can concerns about Open AI's
Speaker 3: cash burn and.
Speaker 4: Karen and Vidia CEO Jensen Wang says his company has
Speaker 4: not yet received any orders from Chinese customers for H
Speaker 4: two hundred AI chips. Jensen Wang spoke with reporters earlier
Speaker 4: today in Taipei.
Speaker 8: I'm hoping that also the Chinese government would allow Nvidia
Speaker 8: to sell in H two hundred.
Speaker 2: So they have to decide, and I'm.
Speaker 8: Looking forward to to a favorable decision. I think that
Speaker 8: H two hundred is very good for America. Technology leadership
Speaker 8: is also very good for the Chinese market.
Speaker 4: I wasn't Video CEO Jensen Wang. Chinese officials recently told
Speaker 4: the country's largest tech firms, including Ali Baba, they can
Speaker 4: prepare orders for h two hundred chips. Suggests Beijing is
Speaker 4: close to formally approving imports of components essential to powering
Speaker 4: artificial intelligence.
Speaker 3: Nathan Big tech earnings continued this afternoon, and that's when
Speaker 3: Apple reports its latest quarterly results. We get a preview
Speaker 3: with the Bloomberg's Tom Busby.
Speaker 9: Apple is boys to deliver its big sales quarter ever,
Speaker 9: thanks in large part to expected blowout sales of its
Speaker 9: iPhone seventeen lineup, especially for the higher end models, but
Speaker 9: investors are still concerned about rising costs for components, especially
Speaker 9: memory chips, and what sales look like in China, which
Speaker 9: declined just three months ago. Bloomberg consensus calls for revenue
Speaker 9: to jump eleven percent higher to one hundred and thirty
Speaker 9: eight point four billion dollars, the biggest quarterly growth in
Speaker 9: four years, on earnings per share of two dollars sixty
Speaker 9: eight cents. Tom Busby Bloomberg Radio.
Speaker 4: Okay, Tom, thank you now let's turn from the markets
Speaker 4: to get you to the latest from Minneapolis. The new
Speaker 4: man in charge of immigration enforcement in the city, Tom Holman,
Speaker 4: is set to hold a news conference later this morning.
Speaker 4: President Trump sent his Borders are to replace Border Patrol
Speaker 4: Commander Greg Bevino in a bid to cool the uproar
Speaker 4: over the shooting deaths of two US citizens by federal agents.
Speaker 4: The two officers involved in Alex Pretti's killing have been
Speaker 4: placed on administrative leave. Meanwhile, President Trump is warning Minneapolis
Speaker 4: Mayor Jacob Frye he is quote playing with fire for
Speaker 4: saying he won change his city's immigration policies. In Minnesota,
Speaker 4: Democrat Ilhan Omar held another town hall last night after
Speaker 4: a man charged at her with a liquid during an
Speaker 4: event earlier this week.
Speaker 10: I wouldn't be where I am at today, having to
Speaker 10: pay for security, having the government to think about providing
Speaker 10: me security if Donald Trump wasn't in office, and if
Speaker 10: he wasn't so obsessed with.
Speaker 4: Me, Democratic Congresswoman il Han Omar. Again, we expect to
Speaker 4: hear from White House Borders our Tom Holman in a
Speaker 4: news conference from Minneapolis. It's set for eight thirty Wall
Speaker 4: Street time, and we will bring it to you live
Speaker 4: on Bloomberg Radio and on the Bloomberg podcast page on YouTube.
Speaker 3: Well, Nathan, we're hearing signs of progress and avoiding a
Speaker 3: government shutdown over the Minneapolis crackdown. A source style's Bloomberg
Speaker 3: News that talks between the White House and Senate Democrats
Speaker 3: are moving closer to Democrats demands. To Minnesota, Democrat Amy
Speaker 3: klobaschar laid out her demands for federal agents on the
Speaker 3: Senate floor.
Speaker 11: The mass should come up, and the body camera should
Speaker 11: go on, and there must be throw a objective and
Speaker 11: independent investigations into these killings.
Speaker 3: Along with Minnesota is Amy Klobuchar, Senate Minority Leader Chuck
Speaker 3: Schumer has insisted that homeland security funds be stripped from
Speaker 3: the massive spending package that'll keep the government open after
Speaker 3: tomorrow night. Senators from both parties say they're open to
Speaker 3: a stopgap measure for homeland security to allow more time
Speaker 3: for negotiations on immigration enforcement.
Speaker 4: Guardrails's turn of the weather Now, Karen, we have more
Speaker 4: frigid temperatures and the possibility of another winter storm this weekend.
Speaker 4: Let's get the latest now from Bloomberg meteorologist Craig Allen.
Speaker 12: Craig, Good morning, Good morning Nathan, and good morning Karen.
Speaker 12: New York City right now is at thirteen Boston fourteen,
Speaker 12: Washington fifteen degrees. So yes, the first thing that we've
Speaker 12: mentioned here is the coal. The suburbs of all these
Speaker 12: cities have readings that are in the single digits and
Speaker 12: the wind chills are also in the single digits to
Speaker 12: near zero. So you're absolutely right. We are starting off
Speaker 12: with bitter, bitter coal temperatures again, and this isn't going away.
Speaker 12: That's lasting through the weekend for sure. Now, let's break
Speaker 12: this down by region for the upcoming possibility of a snowstorm.
Speaker 12: There's definitely going to be a snowstorm across the South Carolina,
Speaker 12: North Carolina, southern Virginia. How close is this going to
Speaker 12: get to Washington, d C. Well, there are winter storm
Speaker 12: watches in effect as far north as the southern parts
Speaker 12: of Virginia. I think DC could get grazed by this.
Speaker 12: I think New York City, especially east of the city
Speaker 12: across Long Island and the eastern sections of New England
Speaker 12: will get grazed by it as well. And definitely Boston
Speaker 12: will be in the works, especially out towards Cape cod
Speaker 12: so heavier amounts east and south based on last night's
Speaker 12: weather maps, and lighter amounts off to the west and north.
Speaker 12: It's still wobbling, guys, so there is still the chance
Speaker 12: of going back and forth on this forecast. We'll have
Speaker 12: more on that as we go through the morning, Nathan,
Speaker 12: Karen own's good.
Speaker 3: All right, Craig Allen, thank you, and of course we
Speaker 3: will be checking back in with you throughout the morning.
Speaker 3: As you said, we want to turn to the economy now.
Speaker 3: Where as I expected, the FED held rates steady, and
Speaker 3: Bloomberg's John Tucker joins us with the very latest John,
Speaker 3: good morning.
Speaker 13: Good morning Karen. This marks the first rate pause since July,
Speaker 13: and at his news conference after the decision, heard here
Speaker 13: live on Bloomberg Radio, Fed shared jer impalaces they're still
Speaker 13: waiting to see the impact of tariffs before committing to
Speaker 13: rate cuts.
Speaker 14: The expectation is that we will see the effects of
Speaker 14: tariffs flowing through goods prices peaking, and then starting to
Speaker 14: come down.
Speaker 13: With a decision to hold state rates steady yesterday was
Speaker 13: approved on a ten to two vote, with the governors
Speaker 13: Christopher Waller as Stephen Myron dissenting in favor of a cut.
Speaker 13: Waller's descent in favor of a rate cut seen as
Speaker 13: keeping him in the race to replace pal As Cheer
Speaker 13: of the Federal Reserve in New York. I'm John Tucker,
Speaker 13: Bloomberg Radio.
Speaker 4: All right, John, thank you for seeing commodities rally this morning.
Speaker 4: In fact, gold is up for ninth straight day, surging
Speaker 4: above fifty five hundred dollars and outs. The rally's been
Speaker 4: fueled by a week or dollar and investor flight from
Speaker 4: sovereign bonds and currencies. Spot gold has risen by nearly
Speaker 4: thirty percent this year.
Speaker 3: Time now for a look at some of the their
Speaker 3: stories making news in New York and around the world.
Speaker 3: And for that we're joined by Bloomberg's Michael Barr.
Speaker 15: Michael, good morning, Good morning Karen. Former New York Mayor
Speaker 15: Eric Adams is responding to criticism about the budget from
Speaker 15: current mayor zoron mcdone. The newly sworn in Democratic Socialist
Speaker 15: mayor argues additional money from the state is necessary because
Speaker 15: the city faces a fiscal crisis created by Adams and
Speaker 15: by a push from former Governor Andrew Cuomo to shift
Speaker 15: costs from the state onto the city.
Speaker 16: We did not arrive at this place by accident. This
Speaker 16: crisis has a name and a chief architect. In the
Speaker 16: words of the Jackson five, it's as easy as ABC.
Speaker 16: This is the Adams budget crisis.
Speaker 15: And Donnie says over two years, New York is steering
Speaker 15: at a twelve point six billion dollar budget gap. Adams
Speaker 15: refuted the claim, saying the city was upgraded by bond
Speaker 15: rating companies and had ample reserves Under his leadership. President
Speaker 15: Trump warned Iron to make a nuclear deal with the
Speaker 15: US or faced military strikes far worse than the attack
Speaker 15: he ordered last June. Ron said it stands ready for
Speaker 15: dialogue based on mutual respect and interests, but warned that
Speaker 15: it will defend itself and respond if pushed. Police a
Speaker 15: man repeatedly crashed his car into the Habbad Lubovich World
Speaker 15: headquarters in New York City. The incident happened last night
Speaker 15: while people were gathered for prayer of the acidic Jewish site.
Speaker 15: No one was injured, Police Commissioner Jessica Tish.
Speaker 11: This incident is.
Speaker 10: Currently investigated as a game crime by the Nypolice Gate
Speaker 10: Crimes Task Force.
Speaker 15: The driver was arrested. Global News four hours a day
Speaker 15: and whenever you want it with Bloomberg News Now. I'm
Speaker 15: Michael Barr, and this is Bloomberg Karen.
Speaker 9: Thanks Michael.
Speaker 3: Time now for our Bloomberg Sports update, and for that
Speaker 3: we bring in John Stashauer.
Speaker 12: Thanks Darren.
Speaker 17: Fifty nine year old Todd Monkin named the new coach
Speaker 17: of the Cleveland Browns. He was an assistant once with
Speaker 17: the Browns, then went to Georgia. Last three years he's
Speaker 17: coached the offense in Baltimore. The NBA trade deadline next
Speaker 17: Thursday in the Milwaukee Bucks was eighteen and twenty seven.
Speaker 17: Their star Giannis So to the compo, currently out with
Speaker 17: a calf injury. The Bucks are said to be open
Speaker 17: to listen to trade offers involving Giannis Lebron James back
Speaker 17: at Cleveland, maybe for the last time, and the Cavs
Speaker 17: blew out the Lakers by thirty at your Bloomberg Sports Update.
Speaker 3: Stay with us more from Bloomberg day Break coming up after.
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Speaker 4: Good morning on Nathan Hager, the AI spending boom is
Speaker 4: in full swing and the biggest names in big tech
Speaker 4: are being rewarded for it if they can show it's
Speaker 4: paying off. This morning, investors seem to think that's the
Speaker 4: case for Meta platforms. For Microsoft not so much. Joining
Speaker 4: us this morning is Man Deep Saying, Global head of
Speaker 4: technology research for Bloomberg Intelligence.
Speaker 15: Man Deep.
Speaker 4: We heard Meta says it's going to spend up to
Speaker 4: one hundred and thirty five billion on capex this year.
Speaker 4: Microsoft just this quarter thirty seven and a half billion
Speaker 4: Meta shares up, Microsoft shares down. What gives.
Speaker 2: Well, So in the case of Meta, I mean, the
Speaker 2: core business seems to be accelerating, and what they highlighted
Speaker 2: last night was, look, I mean, we are spending all
Speaker 2: this money, but we already see some return in terms
Speaker 2: of our ad conversions, better recommendation systems, and eventually we
Speaker 2: will be launching separate products in terms of, you know,
Speaker 2: having an AI assistant that will work within the apps
Speaker 2: content generation tools. So the investors seem to have given
Speaker 2: them a green light in terms of, you know, investing
Speaker 2: upfront with the hope that they will launch new products
Speaker 2: that can that they can monetize you know later in
Speaker 2: the year, So clearly that core business acceleration was key
Speaker 2: in the case of Microsoft. I mean, it was a
Speaker 2: fine quarter. The Azure growth was thirty eight percent instead
Speaker 2: of thirty nine percent, and what they said is, look,
Speaker 2: we are using a lot of the GPUs internally to
Speaker 2: develop our new applications instead of renting them out, you know,
Speaker 2: on Azure. And from that perspective, they are supply constraint
Speaker 2: like all the other companies are. And you know, I
Speaker 2: kind of feel like everyone is, you know, compute constraint
Speaker 2: right now. So that's where memory prices are having an impact,
Speaker 2: and all the things that are going on in terms
Speaker 2: of the price this is are having an impact around
Speaker 2: you know, what these companies are able to do around
Speaker 2: creating that infrastructure. So overall, it was a very good
Speaker 2: quarter for Microsoft. It's just expectations were slightly higher, and
Speaker 2: that's where probably the investors stand. Like that Azure print.
Speaker 4: So in just thirty seconds, man, deep, how does that
Speaker 4: set us up for when we're going to hear from
Speaker 4: Apple later on today?
Speaker 2: I mean memory prices. So Microsoft called out how memory
Speaker 2: prices are having an impact on their Windows sales. So
Speaker 2: I do expect Apple to acknowledge memory prices impacting their
Speaker 2: gross margins, and we'll find out if it's if it
Speaker 2: had an impact on their hardware sales during the quarter.
Speaker 3: This is Bloomberg Daybreak, your morning podcast on the stories
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Speaker 4: And I'm Nathan Hager. Join us again tomorrow morning for
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