Speaker 1: Live from the Bloomberg Interactive Berger Studios. This is is Bloomberg
Speaker 1: day Break for Wednesday, January. Coming up this hour, Microsoft
Speaker 1: shares drop after a warning that cloud computing sales will slug.
Speaker 1: Ernies continue to roll in with Tesla reporting Today, the
Speaker 1: New York Stock Exchange cancel some trades after a glitch
Speaker 1: at yesterday's Open, and the U. S. And Germany prepared
Speaker 1: to send battle tanks to Ukraine. Today is the unveiling
Speaker 1: of the Long Island Railroad Grand Central Route. Plus another
Speaker 1: match shooting, this time in Washington State by Michael Barr.
Speaker 1: More ahead, I'm John Stashtown Sports. The next held on
Speaker 1: to met Cleveland overtime win for the Devils. The quarterfinals
Speaker 1: continue at the Australian Open. That's All's trading ahead on
Speaker 1: Bloomberg day Break on Bloomberg eleven, Free on New York,
Speaker 1: Bloomberg on Washington, d C, Bloomberg one oh six one, Boston,
Speaker 1: Bloomberg nine sixties and Francisco Syrius XM one nineteen and
Speaker 1: around the world Old on Bloomberg Radio dot Com and
Speaker 1: by the Bloomberg Business. Good Morning, I'm Nathan Hagar, and
Speaker 1: I'm kerin Moscow. Here are the stories we're following today.
Speaker 1: Now dropping Nasdaq futures follows a slowing sales outlook for
Speaker 1: Microsoft and it's cloud computing business. Let's get the latest
Speaker 1: on the earnings for the software maker, live with Bloomberg.
Speaker 1: Steve Rappaford, Good morning, Steve, Good morning, Nathan and Karen.
Speaker 1: Shares of Microsoft are down nearly two percent in pre
Speaker 1: market trading after CFO Amy Hood estimated sales of its
Speaker 1: Azure service will slow down in the current period by
Speaker 1: four or five percent from the end of second fiscal quarter.
Speaker 1: The tech giants cloud business was a silver lining in
Speaker 1: a cloud of lackluster earnings. Microsoft's growth of two percent
Speaker 1: in the second quarter was the slowest in six years. Meanwhile,
Speaker 1: Microsoft could use its own technical support for its three
Speaker 1: sixty five service, the company tweeting this morning it identified
Speaker 1: a network configuration problem and it's working to mitigate the impact.
Speaker 1: Live in New York. I'm Steve Rappaport, Bloomberg Daybreak. All right, Steve,
Speaker 1: thank you. We may also see weakness and shares of
Speaker 1: Texas Instruments today. They fell half a percent in late
Speaker 1: trading after the chipmaker suffered its first sales decline since
Speaker 1: we get more from Bloomberg's Charlie pillet T I delivered
Speaker 1: a tepp At forecast for the current quarter, hit by
Speaker 1: an industry slump. It said revenue in the first quarter
Speaker 1: will be four point one seven billion to four point
Speaker 1: five three billion. That compares with average annalists estimates of
Speaker 1: four point four one billion. The outlook suggests that Texas
Speaker 1: Instruments may not bounce back quickly from its sales slow down.
Speaker 1: Wall Street expects revenue to decline throughout this year as
Speaker 1: the company's customers focus on reducing their stockpiles of use
Speaker 1: chips rather than ordering new ones. In New York, Charlie
Speaker 1: Pellett Bloomberg Daybreak, Thanks Charlie, and the earnings continue to
Speaker 1: roll in today. More than thirty companies reporting, and Tesla
Speaker 1: is one we'll be watching. We get a preview from
Speaker 1: Bloomberg's Jeff Bellinger. We already know that Tesla delivered a
Speaker 1: record number of vehicles in the fourth quarter and two
Speaker 1: volume was up from one, but the electric vehicle maker
Speaker 1: achieved those numbers by slashing prices and several of its markets.
Speaker 1: Gene Munster of deep Water Asset Management has told investors
Speaker 1: he expects disappointing numbers from Tesla Bloomberg Intelligence as Tesla's
Speaker 1: discounts run counter to broader industry trends. Jeff Bullinger, Bloomberg
Speaker 1: day Break, Jeff, thank you well. As Tesla reports earning
Speaker 1: CEO Elon Musk is on the stand in a courtroom
Speaker 1: in San Francisco and day three of his trial over
Speaker 1: tweets to take Tesla private. Musk insisted he was acting
Speaker 1: in the best interests of shareholders, and Baxter has the
Speaker 1: latest from our Bloomberg nine sixty news room in San Francisco.
Speaker 1: Musk more defiant in the third round. He addressed the
Speaker 1: jury directly, saying the tweets, using the word considering, reflects
Speaker 1: quote absolutely what I believed at the time, and emphasized
Speaker 1: again that it wasn't a done deal. That's what one
Speaker 1: means when they say they're considering, they're thinking about it.
Speaker 1: Musk also said he would have had no trouble raising
Speaker 1: money for the projects. Attorneys for the other side did
Speaker 1: get him to admit that he did not have any
Speaker 1: specific number from Saudi Arabia in San Francisco. I'm at Baxter,
Speaker 1: Bloomberg Daybreak. Thanks Turning from Silicon Valley to Wall Street.
Speaker 1: Now the New York Stock Exchanges canceling some trades after
Speaker 1: a glitch during yesterday's open, Hundreds of securities began trading
Speaker 1: without an opening auction price. The New York Stock Exchange
Speaker 1: is not elaborating on what it calls a system issue,
Speaker 1: and isn't saying what it may cost now. Nathan to
Speaker 1: an m and a deal that never was. Rupert and
Speaker 1: Lackland Murdoch are abandoning plans to reunite their two media companies,
Speaker 1: Fox and News Corps. Some investors had voiced opposition to
Speaker 1: the mergers, saying it undervalued company assets. The deal, first
Speaker 1: announced in October, was widely seen as a way for
Speaker 1: Lachland Murdoch to cement his control over the Family media empire.
Speaker 1: Tuning to geopolitics now, Karen, the war in Ukraine remains
Speaker 1: largely in focus, and now the US and Germany are
Speaker 1: set to announce they will each provide battle tanks to Ukraine.
Speaker 1: Amy Morris has the details from our Bloomberg newsroom in Washington.
Speaker 1: The Biden administration is expected to announce as soon as
Speaker 1: today that it will offer Ukraine the M one Abrams tank.
Speaker 1: Germany had said it didn't want to be the only
Speaker 1: ally to offer battle tanks. The White House decision helps
Speaker 1: Allied nations move on from a split that had threatened
Speaker 1: to undermine their unity, and it will allow Ukraine to
Speaker 1: prepare for whatever offensive Russia could be planning for this spring.
Speaker 1: Officials on both sides say they're still discussing numbers and
Speaker 1: the timing of any delivery in Washington. I maybe Morris
Speaker 1: Bloomberg daybreak right, Amy, thank you. While staying in Washington.
Speaker 1: New questions are being raised about the handling of classified
Speaker 1: documents now that secret papers have been uncovered in former
Speaker 1: Vice President Mike Pence's home. That follows discoveries that have
Speaker 1: both President Biden and former President Trump under investigation. Tennessee
Speaker 1: Republican Marcia Blackburn since on the Senatejudiciary Committee, and she
Speaker 1: says the Presidential Records Act needs to be reformed, cleaning
Speaker 1: up that process, making certain that we tighten those protocols
Speaker 1: in how the documents are viewed, when and where they're viewed,
Speaker 1: how you send him in send them out, That is
Speaker 1: an appropriate step to take. Senator Blackburn says she liked
Speaker 1: to see the committee take action this year. She was
Speaker 1: a guest on Bloomberg Sound On with Joe Matthew. Catch
Speaker 1: the show weekdays at five pm Eastern on Bloomberg Radio,
Speaker 1: or listen anytime to the Bloomberg Sound On podcast. Its
Speaker 1: thirty five degrees under a clear sky in Central Park.
Speaker 1: We got rain moving in this afternoon, with some wet
Speaker 1: snow potentially mixed in to start breezy highs near forty
Speaker 1: five degrees. The temperatures will rise through the night as
Speaker 1: the rain continues. Time now to look at some of
Speaker 1: the other stories making news in New York and around
Speaker 1: the world with Bloomberg's Michael bar Good morning, Michael, Good
Speaker 1: morning Nathan. New Yorkers are about to get a critical
Speaker 1: commuter service they've waited ye years for. The Long Island
Speaker 1: Railroad were run to Manhattan's Grand Central terminal. The Allied
Speaker 1: Double R will begin limited service today for at least
Speaker 1: three weeks, with Writer's changing trains at the Jamaica stop
Speaker 1: in Queen's during the initial launch. The m t A
Speaker 1: says direct service in the Grand Central WI will roll
Speaker 1: out after that. The eleven point one billion dollar project
Speaker 1: has suffered years of delays. Authorities say they don't know
Speaker 1: yet what caused a gunman to open fire and kill
Speaker 1: three people at a Circle K convenience store in Yakima, Washington.
Speaker 1: Police Chief Matt Murray literally, as he was opening the door,
Speaker 1: he started shooting these people. And then after shooting both
Speaker 1: of them. And remember he was not masked up. He
Speaker 1: did nothing to conceal his identity. He walked out, saw
Speaker 1: somebody else in a car, and shot them. Chief Murray says,
Speaker 1: the suspected gunman, twenty one year old Jared Haddock, shot
Speaker 1: and killed himself. How Speaker Kevin McCarthy says in battled
Speaker 1: New York Freshman Representative George Santos could be removed from
Speaker 1: this if the Chambers Ethics Committee determined that he had
Speaker 1: broken the law, but not until then. The Long Island Republican,
Speaker 1: who presented a largely fictitious version of himself when he
Speaker 1: ran for a House seat, has been denounced by prominent
Speaker 1: members of both parties. Nevertheless, Santos has been given two
Speaker 1: spots on different committees. Meanwhile, McCarthy is kicking two time
Speaker 1: Democrats off the powerful House Intelligence Committee. McCarthy rejected former
Speaker 1: Intel Committee Chair Adam Schiff and member Eric Swalwell. The
Speaker 1: speaker was asked why Santos gets committee seeds and Schiff
Speaker 1: and Swalwell are out. The Intel Committee is different. You
Speaker 1: know why, because what happens in the Intel Committee. You
Speaker 1: don't know what happens in the Intel Committee. Although the
Speaker 1: secrets are going on in the world, other members of
Speaker 1: Congress don't know. McCarthy, however, appointed members of his own
Speaker 1: party to powerful committees who pushed the monked conspiracy theories
Speaker 1: and election denial. Both Francis says being gay is not
Speaker 1: a crime. The Pope, in an to view with the
Speaker 1: Associated Press, is criticizing laws that criminalize homosexuality, saying God
Speaker 1: loves all his children just as they are. Global News
Speaker 1: twenty four hours a day on air and on Bloomberg Quicktake,
Speaker 1: powered by more than journalists analysts more than a hundred
Speaker 1: twenty countries. I'm Michael Barn. This is Bloomberg, Nathan. Thanks Michael.
Speaker 1: Time for the Bloomberg Sports Update, now brought to you
Speaker 1: by Tri State Autie. Good morning, John Stash How good morning, Nathan.
Speaker 1: Much need to win for the Knicks. They had lost
Speaker 1: their last four of that trouble holding leads, and at
Speaker 1: the Garden they led Cleveland by eleven fourth quarter. Calves
Speaker 1: rallied but missed two game time shots of the final seconds.
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Speaker 1: big night for Julius Randall thirty six points made, eight
Speaker 1: three pointers. Five came in the first quarter. Devil's hosted
Speaker 1: Vegas Trail date Dougdee. Hamilton's scored that forced overtime. So
Speaker 1: here's using the center circle across the line, looks up,
Speaker 1: tries to duck under a check, it comes free. They score,
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Speaker 1: It's the other over time Hamilton Devil's Radio. They won
Speaker 1: three two. They won seven of the last eight college hoops.
Speaker 1: Easy win for Rutgers by twenty over Penn State Georgetown
Speaker 1: Vita Paul. That ends a twenty nine game Big East
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Speaker 1: was on the Hall of Fame ballot, he only got
Speaker 1: ten percent of the vote. He just got seventy six percent.
Speaker 1: He'll be inducted this summer in Cooperstown with Fred McGriff,
Speaker 1: who was named by the committee. Roland will be only
Speaker 1: the eighteen third baseman in the Hall. Played for four teams.
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Speaker 1: Glove winners Australian Open. Right now in Novak Djokovic has
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Speaker 1: Flt's good that John Stash and Bloomberg Sports live from
Speaker 1: coast to coast, from New York to San Francisco, Boston
Speaker 1: to Washington, d C. Nationwide on Sirius, xamp, the Bloomberg
Speaker 1: Business app, and Bloomberg dot Com. This is Bloomberg Daybreak.
Speaker 1: Good morning, I'm Nathan Hagra. As we keep our focus
Speaker 1: on tech earnings this morning, Microsoft is the first big
Speaker 1: cap tech company to report in the shares right now
Speaker 1: are down about two per cent after the software giant
Speaker 1: warned of slowing sales this quarter, particularly in the cloud.
Speaker 1: This afternoon, we will get more on the tech picture
Speaker 1: and h automobiles as well. When Tesla reports, it's earnings.
Speaker 1: Let's bring in Bloomberg Quick Take correspondent Alex Webb to
Speaker 1: break down what we saw yesterday from Tesla. I'm sorry
Speaker 1: for Microsoft here from Tesla later, as I said, Alex,
Speaker 1: good morning. Obviously the cloud had been the big growth
Speaker 1: center from Microsoft, and now there's this warning that as
Speaker 1: you can only grow by about four to five percent
Speaker 1: this quarter. Is this about managing expectations or does this
Speaker 1: say something about the broader macro backdrop for attack. Well,
Speaker 1: let's clarify that a little bit. It isn't that it's
Speaker 1: only going to grow for or five percent. It's that
Speaker 1: it's going to grow four or five percentage points slower
Speaker 1: than in the fiscal second quarter where it grew in
Speaker 1: the mid thirties. So you can infer that it's probably
Speaker 1: going to grow, you know, around UM. That's still you know,
Speaker 1: a growth number that a lot of people would love
Speaker 1: to have, but it's clearly slower than it has been previously.
Speaker 1: And it sort of speaks to the way that a
Speaker 1: lot of demand was front loaded by the pandemic as
Speaker 1: people were working from home. UM companies in particular invested
Speaker 1: more in enabling remote work. That of course entailed a
Speaker 1: lot of cloud investment so UM. It means that the
Speaker 1: growth now isn't quite as good now. Of course, the
Speaker 1: growth in the second quarter was only two overall for
Speaker 1: the for the whole company, including Azure and so UM.
Speaker 1: The concern then will be that if if as You're
Speaker 1: is slowing down even further than it has a bigger
Speaker 1: knock on effect on the overall companies performance now. I
Speaker 1: guess it raises a question as well, doesn't it, about
Speaker 1: what the growth picture could look like for other big
Speaker 1: players in the cloud, particularly Amazon Web Services and Alphabet
Speaker 1: as well. Yeah, I think there's more, probably more concern
Speaker 1: around Alphabet. Around Google Cloud, they've been a very distant
Speaker 1: third place. Amazon really tops the part when it climbs
Speaker 1: it comes to the cloud offering. Um, they managed to know,
Speaker 1: really build stickiness with their customers, even though you know,
Speaker 1: you increasingly hear whispers about how how good the this
Speaker 1: sort of interface is. Google has even though it's cloud
Speaker 1: operation has been expanding it it has often been loss
Speaker 1: making because it's investing so hard to try and catch up.
Speaker 1: The interesting thing with Microsoft Cloud is that we've heard
Speaker 1: so much around open AI, s Chat, GPT in recent weeks,
Speaker 1: and that is something that is going to launch a
Speaker 1: Microsoft Cloud before we see anyone as you are Microsoft
Speaker 1: Cloud offering before we see it anywhere else. Um. You know,
Speaker 1: if you're if you want to build an AI business
Speaker 1: on chat GPT for instance, you will have to be
Speaker 1: doing it with Azure. So you know, as we looked
Speaker 1: at the medium to long term, that could be a
Speaker 1: big positive for that business. Yeah, you mentioned the open
Speaker 1: Ai investment obviously something that was got a lot of
Speaker 1: attention from investors ahead of this earnings report. Is it
Speaker 1: something that investors can at least hang their hats on
Speaker 1: and have a little bit of excitement about amid the
Speaker 1: disappointment in the earnings outlook for Microsoft. It is certainly
Speaker 1: something that is you know, generating some excitement, clearly not
Speaker 1: enough to offset any decline in the in the share price.
Speaker 1: It's quite hard for people to know how this stuff
Speaker 1: gets monetized because you know, even Sam ale Than, the
Speaker 1: CEO of open Ai, has been saying that this is
Speaker 1: not in the long term going to be a high
Speaker 1: profit business or high margin business. It's something that you
Speaker 1: will have as an assistant in many things you do,
Speaker 1: plugging into things you do and I you look at
Speaker 1: that will then you infer that it is a way
Speaker 1: of pushing people towards Azure as your itself is cleaning
Speaker 1: very high margin and so it's it's a an additional
Speaker 1: feature that can attract customers, but in and of itself,
Speaker 1: it's probably not going to be making a huge amount
Speaker 1: of money in the medium to long term. It's just
Speaker 1: that it you know, like you get a car with
Speaker 1: a particular feature, even if the future itself isn't that expensive.
Speaker 1: Kind about a minute left here, Alex. Of course we're
Speaker 1: waiting to hear from Tesla this afternoon. Obviously there's been
Speaker 1: so much attention on the CEO Elon Musk. I imagine
Speaker 1: you're gonna be trying to look past up some of
Speaker 1: the antics of late and let us know what your
Speaker 1: focus is going to be on when we hear from Tesla. Yeah,
Speaker 1: you must is going to be taking a break from
Speaker 1: his court dates over the past few days. If if
Speaker 1: he does appear on the call um, the real attention
Speaker 1: is going to be on what kind of color they're
Speaker 1: going to get one pace of deliveries. There's had to
Speaker 1: be some very severe discounting or Tessa has done some
Speaker 1: massive discounting to try to offset declining pace of deliveries.
Speaker 1: They've not been able to deliver all the cars they've
Speaker 1: been making, So how demand profitability pasted delivery shape up?
Speaker 1: Those are the things that investors are really going to
Speaker 1: keep an eye Appleporn. This is Bloomberg Daybreak Today, your
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