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Speaker 1: Live from the Bloomberg Interactive Berger Studios. This is is Bloomberg

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Speaker 1: day Break for Wednesday, January. Coming up this hour, Microsoft

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Speaker 1: shares drop after a warning that cloud computing sales will slug.

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Speaker 1: Ernies continue to roll in with Tesla reporting Today, the

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Speaker 1: New York Stock Exchange cancel some trades after a glitch

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Speaker 1: at yesterday's Open, and the U. S. And Germany prepared

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Speaker 1: to send battle tanks to Ukraine. Today is the unveiling

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Speaker 1: of the Long Island Railroad Grand Central Route. Plus another

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Speaker 1: match shooting, this time in Washington State by Michael Barr.

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Speaker 1: More ahead, I'm John Stashtown Sports. The next held on

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Speaker 1: to met Cleveland overtime win for the Devils. The quarterfinals

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Speaker 1: continue at the Australian Open. That's All's trading ahead on

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Speaker 1: Bloomberg day Break on Bloomberg eleven, Free on New York,

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Speaker 1: Bloomberg on Washington, d C, Bloomberg one oh six one, Boston,

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Speaker 1: Bloomberg nine sixties and Francisco Syrius XM one nineteen and

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Speaker 1: around the world Old on Bloomberg Radio dot Com and

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Speaker 1: by the Bloomberg Business. Good Morning, I'm Nathan Hagar, and

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Speaker 1: I'm kerin Moscow. Here are the stories we're following today.

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Speaker 1: Now dropping Nasdaq futures follows a slowing sales outlook for

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Speaker 1: Microsoft and it's cloud computing business. Let's get the latest

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Speaker 1: on the earnings for the software maker, live with Bloomberg.

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Speaker 1: Steve Rappaford, Good morning, Steve, Good morning, Nathan and Karen.

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Speaker 1: Shares of Microsoft are down nearly two percent in pre

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Speaker 1: market trading after CFO Amy Hood estimated sales of its

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Speaker 1: Azure service will slow down in the current period by

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Speaker 1: four or five percent from the end of second fiscal quarter.

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Speaker 1: The tech giants cloud business was a silver lining in

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Speaker 1: a cloud of lackluster earnings. Microsoft's growth of two percent

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Speaker 1: in the second quarter was the slowest in six years. Meanwhile,

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Speaker 1: Microsoft could use its own technical support for its three

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Speaker 1: sixty five service, the company tweeting this morning it identified

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Speaker 1: a network configuration problem and it's working to mitigate the impact.

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

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Speaker 1: thank you. We may also see weakness and shares of

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Speaker 1: Texas Instruments today. They fell half a percent in late

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Speaker 1: trading after the chipmaker suffered its first sales decline since

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Speaker 1: we get more from Bloomberg's Charlie pillet T I delivered

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Speaker 1: a tepp At forecast for the current quarter, hit by

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Speaker 1: an industry slump. It said revenue in the first quarter

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Speaker 1: will be four point one seven billion to four point

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Speaker 1: five three billion. That compares with average annalists estimates of

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Speaker 1: four point four one billion. The outlook suggests that Texas

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Speaker 1: Instruments may not bounce back quickly from its sales slow down.

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Speaker 1: Wall Street expects revenue to decline throughout this year as

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Speaker 1: the company's customers focus on reducing their stockpiles of use

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Speaker 1: chips rather than ordering new ones. In New York, Charlie

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Speaker 1: Pellett Bloomberg Daybreak, Thanks Charlie, and the earnings continue to

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Speaker 1: roll in today. More than thirty companies reporting, and Tesla

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Speaker 1: is one we'll be watching. We get a preview from

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Speaker 1: Bloomberg's Jeff Bellinger. We already know that Tesla delivered a

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Speaker 1: record number of vehicles in the fourth quarter and two

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Speaker 1: volume was up from one, but the electric vehicle maker

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Speaker 1: achieved those numbers by slashing prices and several of its markets.

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Speaker 1: Gene Munster of deep Water Asset Management has told investors

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Speaker 1: he expects disappointing numbers from Tesla Bloomberg Intelligence as Tesla's

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Speaker 1: discounts run counter to broader industry trends. Jeff Bullinger, Bloomberg

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Speaker 1: day Break, Jeff, thank you well. As Tesla reports earning

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Speaker 1: CEO Elon Musk is on the stand in a courtroom

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Speaker 1: in San Francisco and day three of his trial over

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Speaker 1: tweets to take Tesla private. Musk insisted he was acting

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Speaker 1: in the best interests of shareholders, and Baxter has the

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Speaker 1: latest from our Bloomberg nine sixty news room in San Francisco.

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Speaker 1: Musk more defiant in the third round. He addressed the

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Speaker 1: jury directly, saying the tweets, using the word considering, reflects

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Speaker 1: quote absolutely what I believed at the time, and emphasized

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Speaker 1: again that it wasn't a done deal. That's what one

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Speaker 1: means when they say they're considering, they're thinking about it.

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Speaker 1: Musk also said he would have had no trouble raising

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Speaker 1: money for the projects. Attorneys for the other side did

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Speaker 1: get him to admit that he did not have any

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Speaker 1: specific number from Saudi Arabia in San Francisco. I'm at Baxter,

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Speaker 1: Bloomberg Daybreak. Thanks Turning from Silicon Valley to Wall Street.

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Speaker 1: Now the New York Stock Exchanges canceling some trades after

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Speaker 1: a glitch during yesterday's open, Hundreds of securities began trading

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Speaker 1: without an opening auction price. The New York Stock Exchange

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Speaker 1: is not elaborating on what it calls a system issue,

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Speaker 1: and isn't saying what it may cost now. Nathan to

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Speaker 1: an m and a deal that never was. Rupert and

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Speaker 1: Lackland Murdoch are abandoning plans to reunite their two media companies,

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Speaker 1: Fox and News Corps. Some investors had voiced opposition to

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Speaker 1: the mergers, saying it undervalued company assets. The deal, first

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Speaker 1: announced in October, was widely seen as a way for

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Speaker 1: Lachland Murdoch to cement his control over the Family media empire.

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Speaker 1: Tuning to geopolitics now, Karen, the war in Ukraine remains

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Speaker 1: largely in focus, and now the US and Germany are

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Speaker 1: set to announce they will each provide battle tanks to Ukraine.

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Speaker 1: Amy Morris has the details from our Bloomberg newsroom in Washington.

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Speaker 1: The Biden administration is expected to announce as soon as

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Speaker 1: today that it will offer Ukraine the M one Abrams tank.

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Speaker 1: Germany had said it didn't want to be the only

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Speaker 1: ally to offer battle tanks. The White House decision helps

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Speaker 1: Allied nations move on from a split that had threatened

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Speaker 1: to undermine their unity, and it will allow Ukraine to

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Speaker 1: prepare for whatever offensive Russia could be planning for this spring.

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Speaker 1: Officials on both sides say they're still discussing numbers and

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Speaker 1: the timing of any delivery in Washington. I maybe Morris

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Speaker 1: Bloomberg daybreak right, Amy, thank you. While staying in Washington.

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Speaker 1: New questions are being raised about the handling of classified

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Speaker 1: documents now that secret papers have been uncovered in former

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Speaker 1: Vice President Mike Pence's home. That follows discoveries that have

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Speaker 1: both President Biden and former President Trump under investigation. Tennessee

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Speaker 1: Republican Marcia Blackburn since on the Senatejudiciary Committee, and she

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Speaker 1: says the Presidential Records Act needs to be reformed, cleaning

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Speaker 1: up that process, making certain that we tighten those protocols

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Speaker 1: in how the documents are viewed, when and where they're viewed,

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Speaker 1: how you send him in send them out, That is

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Speaker 1: an appropriate step to take. Senator Blackburn says she liked

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Speaker 1: to see the committee take action this year. She was

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Speaker 1: a guest on Bloomberg Sound On with Joe Matthew. Catch

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

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Speaker 1: or listen anytime to the Bloomberg Sound On podcast. Its

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Speaker 1: thirty five degrees under a clear sky in Central Park.

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Speaker 1: We got rain moving in this afternoon, with some wet

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Speaker 1: snow potentially mixed in to start breezy highs near forty

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Speaker 1: five degrees. The temperatures will rise through the night as

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Speaker 1: the rain continues. Time now to look at some of

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Speaker 1: the other stories making news in New York and around

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Speaker 1: the world with Bloomberg's Michael bar Good morning, Michael, Good

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Speaker 1: morning Nathan. New Yorkers are about to get a critical

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Speaker 1: commuter service they've waited ye years for. The Long Island

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Speaker 1: Railroad were run to Manhattan's Grand Central terminal. The Allied

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Speaker 1: Double R will begin limited service today for at least

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Speaker 1: three weeks, with Writer's changing trains at the Jamaica stop

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Speaker 1: in Queen's during the initial launch. The m t A

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Speaker 1: says direct service in the Grand Central WI will roll

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Speaker 1: out after that. The eleven point one billion dollar project

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Speaker 1: has suffered years of delays. Authorities say they don't know

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Speaker 1: yet what caused a gunman to open fire and kill

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Speaker 1: three people at a Circle K convenience store in Yakima, Washington.

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Speaker 1: Police Chief Matt Murray literally, as he was opening the door,

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Speaker 1: he started shooting these people. And then after shooting both

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Speaker 1: of them. And remember he was not masked up. He

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Speaker 1: did nothing to conceal his identity. He walked out, saw

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Speaker 1: somebody else in a car, and shot them. Chief Murray says,

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Speaker 1: the suspected gunman, twenty one year old Jared Haddock, shot

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Speaker 1: and killed himself. How Speaker Kevin McCarthy says in battled

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Speaker 1: New York Freshman Representative George Santos could be removed from

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Speaker 1: this if the Chambers Ethics Committee determined that he had

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Speaker 1: broken the law, but not until then. The Long Island Republican,

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Speaker 1: who presented a largely fictitious version of himself when he

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Speaker 1: ran for a House seat, has been denounced by prominent

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Speaker 1: members of both parties. Nevertheless, Santos has been given two

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Speaker 1: spots on different committees. Meanwhile, McCarthy is kicking two time

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Speaker 1: Democrats off the powerful House Intelligence Committee. McCarthy rejected former

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Speaker 1: Intel Committee Chair Adam Schiff and member Eric Swalwell. The

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Speaker 1: speaker was asked why Santos gets committee seeds and Schiff

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Speaker 1: and Swalwell are out. The Intel Committee is different. You

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Speaker 1: know why, because what happens in the Intel Committee. You

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Speaker 1: don't know what happens in the Intel Committee. Although the

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Speaker 1: secrets are going on in the world, other members of

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Speaker 1: Congress don't know. McCarthy, however, appointed members of his own

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Speaker 1: party to powerful committees who pushed the monked conspiracy theories

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Speaker 1: and election denial. Both Francis says being gay is not

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Speaker 1: a crime. The Pope, in an to view with the

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Speaker 1: Associated Press, is criticizing laws that criminalize homosexuality, saying God

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Speaker 1: loves all his children just as they are. Global News

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

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Speaker 1: powered by more than journalists analysts more than a hundred

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Speaker 1: twenty countries. I'm Michael Barn. This is Bloomberg, Nathan. Thanks Michael.

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Speaker 1: Time for the Bloomberg Sports Update, now brought to you

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Speaker 1: by Tri State Autie. Good morning, John Stash How good morning, Nathan.

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Speaker 1: Much need to win for the Knicks. They had lost

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Speaker 1: their last four of that trouble holding leads, and at

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Speaker 1: the Garden they led Cleveland by eleven fourth quarter. Calves

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Speaker 1: rallied but missed two game time shots of the final seconds.

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Speaker 1: Nix held on one oh five, one oh three. Another

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Speaker 1: big night for Julius Randall thirty six points made, eight

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Speaker 1: three pointers. Five came in the first quarter. Devil's hosted

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Speaker 1: Vegas Trail date Dougdee. Hamilton's scored that forced overtime. So

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Speaker 1: here's using the center circle across the line, looks up,

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Speaker 1: tries to duck under a check, it comes free. They score,

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Speaker 1: pluck cooks that Hamilton between the circles and drives one hole.

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Speaker 1: It's the other over time Hamilton Devil's Radio. They won

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Speaker 1: three two. They won seven of the last eight college hoops.

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Speaker 1: Easy win for Rutgers by twenty over Penn State Georgetown

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Speaker 1: Vita Paul. That ends a twenty nine game Big East

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Speaker 1: losing streak for Patrick Ewing's Joya's. First time Scott Roland

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Speaker 1: was on the Hall of Fame ballot, he only got

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Speaker 1: ten percent of the vote. He just got seventy six percent.

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Speaker 1: He'll be inducted this summer in Cooperstown with Fred McGriff,

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Speaker 1: who was named by the committee. Roland will be only

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Speaker 1: the eighteen third baseman in the Hall. Played for four teams.

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Speaker 1: Was the seventh time All Star and eight time Gold

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Speaker 1: Glove winners Australian Open. Right now in Novak Djokovic has

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Speaker 1: won the first set, with Andre Rubile have the winner.

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Speaker 1: This match will play New Jersey native Tommy Paul in

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Speaker 1: the semifinals, Paul Housted fellow American Bench Shelton in four sets.

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Speaker 1: Women's quarterfinal wins for Arena Sabolanka Belarus she's yet to

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Speaker 1: lose a set, and Magdalette of Poland she upset Carolina

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Speaker 1: Flt's good that John Stash and Bloomberg Sports live from

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Speaker 1: coast to coast, from New York to San Francisco, Boston

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Speaker 1: to Washington, d C. Nationwide on Sirius, xamp, the Bloomberg

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Speaker 1: Business app, and Bloomberg dot Com. This is Bloomberg Daybreak.

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Speaker 1: Good morning, I'm Nathan Hagra. As we keep our focus

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Speaker 1: on tech earnings this morning, Microsoft is the first big

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Speaker 1: cap tech company to report in the shares right now

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Speaker 1: are down about two per cent after the software giant

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Speaker 1: warned of slowing sales this quarter, particularly in the cloud.

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Speaker 1: This afternoon, we will get more on the tech picture

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Speaker 1: and h automobiles as well. When Tesla reports, it's earnings.

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Speaker 1: Let's bring in Bloomberg Quick Take correspondent Alex Webb to

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Speaker 1: break down what we saw yesterday from Tesla. I'm sorry

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Speaker 1: for Microsoft here from Tesla later, as I said, Alex,

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Speaker 1: good morning. Obviously the cloud had been the big growth

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Speaker 1: center from Microsoft, and now there's this warning that as

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Speaker 1: you can only grow by about four to five percent

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Speaker 1: this quarter. Is this about managing expectations or does this

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Speaker 1: say something about the broader macro backdrop for attack. Well,

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Speaker 1: let's clarify that a little bit. It isn't that it's

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Speaker 1: only going to grow for or five percent. It's that

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Speaker 1: it's going to grow four or five percentage points slower

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Speaker 1: than in the fiscal second quarter where it grew in

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Speaker 1: the mid thirties. So you can infer that it's probably

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Speaker 1: going to grow, you know, around UM. That's still you know,

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Speaker 1: a growth number that a lot of people would love

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Speaker 1: to have, but it's clearly slower than it has been previously.

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Speaker 1: And it sort of speaks to the way that a

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Speaker 1: lot of demand was front loaded by the pandemic as

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Speaker 1: people were working from home. UM companies in particular invested

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Speaker 1: more in enabling remote work. That of course entailed a

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Speaker 1: lot of cloud investment so UM. It means that the

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Speaker 1: growth now isn't quite as good now. Of course, the

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Speaker 1: growth in the second quarter was only two overall for

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Speaker 1: the for the whole company, including Azure and so UM.

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Speaker 1: The concern then will be that if if as You're

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Speaker 1: is slowing down even further than it has a bigger

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Speaker 1: knock on effect on the overall companies performance now. I

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Speaker 1: guess it raises a question as well, doesn't it, about

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Speaker 1: what the growth picture could look like for other big

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Speaker 1: players in the cloud, particularly Amazon Web Services and Alphabet

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Speaker 1: as well. Yeah, I think there's more, probably more concern

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Speaker 1: around Alphabet. Around Google Cloud, they've been a very distant

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Speaker 1: third place. Amazon really tops the part when it climbs

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Speaker 1: it comes to the cloud offering. Um, they managed to know,

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Speaker 1: really build stickiness with their customers, even though you know,

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Speaker 1: you increasingly hear whispers about how how good the this

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Speaker 1: sort of interface is. Google has even though it's cloud

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Speaker 1: operation has been expanding it it has often been loss

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Speaker 1: making because it's investing so hard to try and catch up.

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Speaker 1: The interesting thing with Microsoft Cloud is that we've heard

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Speaker 1: so much around open AI, s Chat, GPT in recent weeks,

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Speaker 1: and that is something that is going to launch a

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Speaker 1: Microsoft Cloud before we see anyone as you are Microsoft

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Speaker 1: Cloud offering before we see it anywhere else. Um. You know,

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Speaker 1: if you're if you want to build an AI business

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Speaker 1: on chat GPT for instance, you will have to be

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Speaker 1: doing it with Azure. So you know, as we looked

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Speaker 1: at the medium to long term, that could be a

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Speaker 1: big positive for that business. Yeah, you mentioned the open

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Speaker 1: Ai investment obviously something that was got a lot of

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Speaker 1: attention from investors ahead of this earnings report. Is it

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Speaker 1: something that investors can at least hang their hats on

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Speaker 1: and have a little bit of excitement about amid the

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Speaker 1: disappointment in the earnings outlook for Microsoft. It is certainly

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Speaker 1: something that is you know, generating some excitement, clearly not

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Speaker 1: enough to offset any decline in the in the share price.

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Speaker 1: It's quite hard for people to know how this stuff

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Speaker 1: gets monetized because you know, even Sam ale Than, the

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Speaker 1: CEO of open Ai, has been saying that this is

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Speaker 1: not in the long term going to be a high

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Speaker 1: profit business or high margin business. It's something that you

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Speaker 1: will have as an assistant in many things you do,

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Speaker 1: plugging into things you do and I you look at

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Speaker 1: that will then you infer that it is a way

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Speaker 1: of pushing people towards Azure as your itself is cleaning

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Speaker 1: very high margin and so it's it's a an additional

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Speaker 1: feature that can attract customers, but in and of itself,

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Speaker 1: it's probably not going to be making a huge amount

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Speaker 1: of money in the medium to long term. It's just

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Speaker 1: that it you know, like you get a car with

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Speaker 1: a particular feature, even if the future itself isn't that expensive.

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Speaker 1: Kind about a minute left here, Alex. Of course we're

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Speaker 1: waiting to hear from Tesla this afternoon. Obviously there's been

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Speaker 1: so much attention on the CEO Elon Musk. I imagine

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Speaker 1: you're gonna be trying to look past up some of

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Speaker 1: the antics of late and let us know what your

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Speaker 1: focus is going to be on when we hear from Tesla. Yeah,

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Speaker 1: you must is going to be taking a break from

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Speaker 1: his court dates over the past few days. If if

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Speaker 1: he does appear on the call um, the real attention

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Speaker 1: is going to be on what kind of color they're

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Speaker 1: going to get one pace of deliveries. There's had to

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Speaker 1: be some very severe discounting or Tessa has done some

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Speaker 1: massive discounting to try to offset declining pace of deliveries.

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Speaker 1: They've not been able to deliver all the cars they've

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Speaker 1: been making, So how demand profitability pasted delivery shape up?

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Speaker 1: Those are the things that investors are really going to

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Speaker 1: keep an eye Appleporn. This is Bloomberg Daybreak Today, your

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