WEBVTT - Big Tech Earnings Disappoint; US Jobs Report Preview

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio news. Good morning, I'm Nathan

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

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<v Speaker 1>following today.

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<v Speaker 2>Karen, this stock sell off is intensifying around the world.

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<v Speaker 3>This morning.

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<v Speaker 2>In Japan, the topics sank six point one percent that

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<v Speaker 2>completed a two day drop of nine point two the

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<v Speaker 2>biggest route over two days since Japan's tsunami back in

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<v Speaker 2>twenty eleven. US futures, as you mentioned, are sliding once

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<v Speaker 2>again after yesterday's Wall Street sell off, following data that

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<v Speaker 2>showed weekly unemployment claims hit a near one year high

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<v Speaker 2>while manufacturing shrank. Cam Harvey, professor at Duke Business School,

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<v Speaker 2>thinks the FED is behind the ball again.

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<v Speaker 4>The FED is very late again. So they were late

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<v Speaker 4>to raise interest rates when they were kind of brushing

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<v Speaker 4>off the inflation surge, and they're late to reduce the rates,

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<v Speaker 4>and the cost could be very substantial.

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<v Speaker 2>Duke Business Professor Cam Harvey thinks one of those costs

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<v Speaker 2>could be a hard landing. Meanwhile, a rally in treasuries

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<v Speaker 2>is now into its seventh straight day, and again checking

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<v Speaker 2>the ten yurar, it's up six thirty seconds now. The

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<v Speaker 2>yield three point nine to five percent. The two year

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<v Speaker 2>is at four point one four percent.

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<v Speaker 5>Well, Nathan, All of this makes this morning's jobs report

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<v Speaker 5>at crucial data point four investors. The forecast is for

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<v Speaker 5>a gain of one hundred and seventy five thousand non

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<v Speaker 5>farm jobs in July. We get a preview from Bloomberg's

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<v Speaker 5>Michael McKee.

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<v Speaker 6>The forecast is for a slight cooling in the labor

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<v Speaker 6>market during July, but the risk for Wall Street and

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<v Speaker 6>the Fed is a more dramatic drop in hiring and

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<v Speaker 6>or a large rise in unemployment. Jobs data from adp

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<v Speaker 6>ISM and initial jobless claims have come in weaker than

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<v Speaker 6>expected in the past few weeks. At their meeting Wednesday,

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<v Speaker 6>FED officials acknowledged a payrolls led economic slowdown is now

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<v Speaker 6>as much of a risk as higher inflation. A bad

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<v Speaker 6>news report today could raise questions about their decision to

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<v Speaker 6>hold rate steady this week. Investors have already priced in

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<v Speaker 6>rate cuts at the next four FED meetings. Michael McKee Bloomberg.

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<v Speaker 2>Radio, Thanks Mike. Adding the pressure to stocks as well

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<v Speaker 2>some disappointing high tech earnings led by Intel. Those shares

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<v Speaker 2>are plunging nearly twenty two percent The chip maker forecast

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<v Speaker 2>revenue for the third quarter below estimates and is suspending

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<v Speaker 2>its dividends starting in the fourth quarter. James Kacmac is

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<v Speaker 2>a technology analystic Clockwise Capital.

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<v Speaker 4>They have to write the ship somehow because the growth is.

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<v Speaker 7>Just anemic, and one way to do that is to find.

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<v Speaker 8>A way to grow.

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<v Speaker 9>Again, or you can fix things on the expense side.

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<v Speaker 7>And it looks like they're giving up on the former

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<v Speaker 7>and going toward the.

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<v Speaker 2>Ladder to that point. Clockwise Capital James Cackmac notes Intel

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<v Speaker 2>plans to slash fifteen thousand jobs well Nathan.

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<v Speaker 5>Shares of Amazon are down more than eight percent after

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<v Speaker 5>years of cutting costs. Investors are sern the company is

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<v Speaker 5>returning to a boom in spending. In an earnings call,

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<v Speaker 5>Amazon's CEO Andy Jasse warn profits will have to take

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<v Speaker 5>a back seat so the company can invest in artificial intelligence.

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<v Speaker 6>It remain very bullish on the medium to long term

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<v Speaker 6>impact of AI and every business we know and can imagine.

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<v Speaker 10>The progress may not be one straight line for companies.

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<v Speaker 10>Generative AI especially is quite.

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<v Speaker 6>Iterative, and companies have to build muscle around the best

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<v Speaker 6>way to solve actual customer problems.

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<v Speaker 5>Amazon CEO Andy Jasse projected operating income for the current

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<v Speaker 5>quarter will be eleven and a half billion to fifteen

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<v Speaker 5>billion dollars. Analysts, on average, we're looking for fifteen point

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<v Speaker 5>seven billion.

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<v Speaker 2>Well, meantime, Karen, Apple is bucking the sell off trend

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<v Speaker 2>somewhat this morning. The shares are down, but only by

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<v Speaker 2>two tenths of one percent. Apple's predicting its new artificial

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<v Speaker 2>intelligence features will spur iPhone upgrades in coming months and

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<v Speaker 2>will help the company re emerge from a sales slowdown

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<v Speaker 2>that hit its business in China, especially hard. Mark German

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<v Speaker 2>covers Apple for Bloomberg News.

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<v Speaker 11>Apple intelligence is really the big upgrade on the iPhone

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<v Speaker 11>that they're trying to sell this year. They talked about

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<v Speaker 11>AI so much on this call. I haven't heard them

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<v Speaker 11>talk about AI so much since their Developer's conference in June,

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<v Speaker 11>or maybe ever.

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<v Speaker 2>Bloomberg technology reporter Mark German says, Apple projects total sales

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<v Speaker 2>in the September quarter we'll grow at about five percent.

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<v Speaker 2>Wall Street projected a four percent clip.

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<v Speaker 5>Well, Nathan, we'll have more on the market sell off

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<v Speaker 5>in tech earnings in a few minutes. But now President

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<v Speaker 5>Biden is celebrating a major win in global diplomacy. The

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<v Speaker 5>President was a joint based Andrews outside Washington last night

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<v Speaker 5>as Wall Street General reporter Evan Gershkevich, former Marine Paul Wheeland,

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<v Speaker 5>and journalist al su Kermasheva came home. The three Americans

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<v Speaker 5>are part of the largest prisoner swamp with Russia since

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<v Speaker 5>the Cold War, and President Biden said it couldn't have

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<v Speaker 5>gone done without support from US allies, and what I said.

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<v Speaker 2>Lines has making difference as we stepped up, but took a.

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<v Speaker 3>Chance for that mattered a love.

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<v Speaker 5>President and Biden was joined on the tarmac by Vice

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<v Speaker 5>President and new presumptive Democratic nominee Kamala Harris.

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<v Speaker 12>I'm very thankful for our president and what he has

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<v Speaker 12>done for his entire career, put in particular as it

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<v Speaker 12>relates to these families of these.

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<v Speaker 5>Individuals, Vice President Harris, as the exchange did not come

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<v Speaker 5>easily and returned for the Americans and other prisoners. Russia

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<v Speaker 5>won the release of Adam Krazakov, who had been serving

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<v Speaker 5>life in Germany for killing a Chechen separatist. Germany had

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<v Speaker 5>long resisted Krasakov's release.

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<v Speaker 2>Well now Karen, President Biden faces a diplomatic challenge in

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<v Speaker 2>the Middle East. The President told Israeli Prime Minister Benjamin

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<v Speaker 2>Natan Yahoo to agree to a cease fire with Hamas

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<v Speaker 2>the two leaders spoke yesterday, Biden did pledge to support

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<v Speaker 2>Israel against renewed threats from Iran and allied militias like

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<v Speaker 2>Hesbolat Nathan.

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<v Speaker 5>The UMSS has recognized Venezuelan opposition presidential candidate at Mundo

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<v Speaker 5>Gonzalez in the disputed election, and Bloomberg's Ed Baxter has

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<v Speaker 5>that story from US.

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<v Speaker 10>Secretary of State Anthony Blincoln says it is clear to

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<v Speaker 10>the United States and most importantly to the Venezuelan people,

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<v Speaker 10>that Gonzalez has won the most votes in the July

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<v Speaker 10>twenty eighth election. Blencoln goes on to say that the

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<v Speaker 10>United States congratulates Gonzales on a successful campaign and hopes

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<v Speaker 10>that discussions on a respectful, peaceful transition will occur. Opposition

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<v Speaker 10>leader Maria Corrina Machavo meanwhile says she is in hiding,

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<v Speaker 10>fearing for her life. Ed Baxter Bloomberg.

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<v Speaker 2>Radio, Okay, and thank you. As for US politics, we

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<v Speaker 2>have a winner in a primary race from more than

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<v Speaker 2>a month ago. A Trump back to candidate has defeated

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<v Speaker 2>the chairman of the Conservative House Freedom Caucus in Virginia's

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<v Speaker 2>fifth congressional district. State Senator and former Navy seal John

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<v Speaker 2>McGuire has been declared the winner over Congressman Bob Good

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<v Speaker 2>by just three hundred and seventy votes out of nearly

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<v Speaker 2>sixty three thousand casts. Before the recount, McGuire's lead was

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<v Speaker 2>three hundred and seventy four votes.

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<v Speaker 5>Nathan and Vice President Kamala Harris's camp Haynes, says she's

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<v Speaker 5>raised a record at three hundred and ten million dollars

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<v Speaker 5>in July. Harris's hall more than doubles nearly one hundred

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<v Speaker 5>and thirty nine million Trump Rays last month. Harris's campaign

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<v Speaker 5>says grassroots donors giving less than two hundred dollars accounted

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<v Speaker 5>for ninety four percent of the four point two million

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<v Speaker 5>donations that were received. Time Now for look at some

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<v Speaker 5>of the other stories making news in New York and

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<v Speaker 5>around the world. For that, we're joined by Bloomberg's John Tucker, John,

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<v Speaker 5>Good morning, and.

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<v Speaker 9>Good Morning Karen. Two NYPD officers are recovering after they

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<v Speaker 9>were shot while responding to a robbery on Manhattan's Lower

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<v Speaker 9>east Side. Police say a suspect armed with a gun

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<v Speaker 9>began robbing women and snatching their purses in a Magine

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<v Speaker 9>parlor at ninety one Canal Street yesterday afternoon. Nearby officers

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<v Speaker 9>heard the screams and responded as the suspect fled. Police

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<v Speaker 9>identified him as twenty two year old Joshua Dorset. While

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<v Speaker 9>the officers caught the suspect, the NYPD says he fired

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<v Speaker 9>one shot that struck both sergeants. New York Mayor Eric Adams.

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<v Speaker 13>The suspect who actually visited his probation officer this morning,

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<v Speaker 13>is in custody at this time, and I want to

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<v Speaker 13>be clear our NYPDU officers did not fire on the suspect.

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<v Speaker 9>One sergeant was hit in the upper thigh, the other

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<v Speaker 9>was grazed on his leg. A sheriff is answering more

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<v Speaker 9>questions after a deputy shot and killed a woman in

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<v Speaker 9>her home last month, Sonya Massey called nine to one

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<v Speaker 9>one about a possible intruder. Before the deputies arrived in Springfield, Illinois,

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<v Speaker 9>Sheriff Jack Campbell was asked about now ex deputy Sean

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<v Speaker 9>Grayson having worked for his several police agencies in a

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<v Speaker 9>short time.

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<v Speaker 7>There was nothing in his background that would disqualify him

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<v Speaker 7>from being a police officer in Illinois. In fact, he'd

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<v Speaker 7>been hired by five other agencies and he'd been certified

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<v Speaker 7>by the Save Illinois six different times to be a

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<v Speaker 7>police officer here, So it was nothing in his background

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<v Speaker 7>and they would prevent him from being.

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<v Speaker 4>A police officer.

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<v Speaker 9>Sheriff Campbell sends. When the department failed Massie, he won't resign.

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<v Speaker 9>Dozens of homes have been destroyed by wildfire in Larimer County, Colorado.

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<v Speaker 9>This woman lives in the town of Drake and says

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<v Speaker 9>she's gotten confirmation her home burned to the ground.

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<v Speaker 2>So I've lost what.

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<v Speaker 14>Is the best community in this the ninny world, and

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<v Speaker 14>I'm very excit about That's that's very sad to me

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<v Speaker 14>that we can no longer call that home.

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<v Speaker 9>She says. She evacuated Monday while her husband had already

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<v Speaker 9>left town for work. The blaze one of almost one

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<v Speaker 9>hundred large fires ranging across the West, and more than

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<v Speaker 9>one hundred video game performers picketed in front of the

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<v Speaker 9>Warner Brothers Studios in Los Angeles to protest against what

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<v Speaker 9>they call an unwillingness from top gaming companies to protect

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<v Speaker 9>actors against the unregulated use of artificial Intelligence, Global news

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<v Speaker 9>twenty four hours a day, whenever you want it with

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<v Speaker 9>Bloomberg News. Now, I'm John, This is Bloomberg. Nathan and Karen.

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<v Speaker 5>John, thank you timed off the Bloomberg Sports Update. But

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<v Speaker 5>John Stashauer, John.

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<v Speaker 8>Good morning, Good morning, Karen, Katie Ledecky and Simone Biles

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<v Speaker 8>Olympic goats. They've got the hardware to prove it. The

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<v Speaker 8>Decky part of the eight hundred freestyle realite team that

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<v Speaker 8>won the silver medal, giving her thirteen career medals, most

0:10:24.160 --> 0:10:27.440
<v Speaker 8>of any American female athlete files in competition that was

0:10:27.720 --> 0:10:31.040
<v Speaker 8>closer than expected, still won the gold and the gymnastics

0:10:31.120 --> 0:10:33.600
<v Speaker 8>all around her seventh career medal. Fourth Golds, who has

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<v Speaker 8>won six World Championship Soony Lee, who won the gold

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<v Speaker 8>three years ago this time took the bronze. But the

0:10:38.400 --> 0:10:42.640
<v Speaker 8>Olympics so often about unknown athletes, like the four rowers

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<v Speaker 8>that won the first US gold medal in that event

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<v Speaker 8>since nineteen sixty and the women's fencing team winning a

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<v Speaker 8>first ever gold for the US. It's the third career

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<v Speaker 8>gold for Lee Keefer Yankee tonight started a nine game

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<v Speaker 8>homestand against the Blue Jays Yanks touch would be better

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<v Speaker 8>on the roads, had a five to one road trip.

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<v Speaker 8>Tonight is Jazz Chisholm. His first game of the Pinstripes.

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<v Speaker 8>He just had a pair of two home run games.

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<v Speaker 8>He's also been playing a surprisingly solid third base. Here's

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<v Speaker 8>Aaron Judge on his new teammate.

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<v Speaker 15>Yes, a guy to played a new position for the

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<v Speaker 15>first time his career, and you know, some big, big

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<v Speaker 15>games for us, and it looks like he's been playing there,

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<v Speaker 15>you know, his whole life. So it's he brings a

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<v Speaker 15>great energy. He runs a base as well. We kind

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<v Speaker 15>of like having him right in the middle of the

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<v Speaker 15>lineup and it's doing some damage getting on base. It's

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<v Speaker 15>spin a big part.

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<v Speaker 8>Marcus Strouman on the Mount tonight. He has struggled lately.

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<v Speaker 8>The Mets visit the Angels, who just got worried that

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<v Speaker 8>they're so often injured. Star Mic Trap will miss the

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<v Speaker 8>rest of the season with a knee injury. White Sox

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<v Speaker 8>tonight bring their seventeen game losing streight to Minnesota. The

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<v Speaker 8>Evan one since July tenthday earlier this season, lost thirteen

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<v Speaker 8>in a row. First NFL preseason game in Canada, high

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<v Speaker 8>the Bears beat the Texans twenty one to seventeen the

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<v Speaker 8>Hall of Fame game. It was stopped in the third

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<v Speaker 8>quarter due to severe weather. First looked at the NFL's

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<v Speaker 8>new rule on kickoffs. Seven all time greats will be

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<v Speaker 8>inducted in the Hall tomorrow. Dashell Er Bloomberg Sports carry.

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<v Speaker 3>Nathan coast to coast on Bloomberg Radio, nationwide on Sirius XM,

0:12:08.559 --> 0:12:11.480
<v Speaker 3>and around the world on Bloomberg dot Com and the

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<v Speaker 3>Bloomberg Business app. This is Bloomberg Daybreak. Good morning, I'm

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<v Speaker 3>Nathan Hager.

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<v Speaker 2>We are watching a global stock sell off this morning,

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<v Speaker 2>led by big tech in this country after earnings disappointment

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<v Speaker 2>from three tech giants. Joining us for some analysis as

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<v Speaker 2>Matthew Bloxham, technology analysts for Bloomberg Intelligence Mad Good morning.

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<v Speaker 2>Let's start with Intel. It is among the biggest laggards

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<v Speaker 2>on the stock exchange this morning. Is Intel on the

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<v Speaker 2>outside looking in when it comes to the AI race?

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<v Speaker 16>Yeah, I think you very much here. Oh, you know,

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<v Speaker 16>perhaps other way. You know, it's definitely on the wrong

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<v Speaker 16>side of the AI opportunity right now. And you know,

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<v Speaker 16>kind of quite a bleak update they gave yesterday, you know,

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<v Speaker 16>kind of weak margins in the quarter and a very

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<v Speaker 16>muted outlook for revenue growth next quarter, you know, probably

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<v Speaker 16>twelve and a half to thirteen and ANUR billion dollars

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<v Speaker 16>versus the market expectation of fourteen. But I think it

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<v Speaker 16>goes beyond, you know, just the next quarter. What they're

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<v Speaker 16>doing on downsizing the business and taking out more than

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<v Speaker 16>fifteen percent of heads and cutting their gross capex by

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<v Speaker 16>something like twenty percent or more. You know, it is

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<v Speaker 16>a really clear signal that the forward market opportunity for

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<v Speaker 16>them is substantially smaller than they had been expecting. And

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<v Speaker 16>that's you know, a reflection of I guess kind of

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<v Speaker 16>getting a little bit caught out by maybe the pace

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<v Speaker 16>at which the geneesh Fai opportunity has taken off, and obviously,

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<v Speaker 16>you know all of that opportunity occurring primarily to in video.

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<v Speaker 16>You know, Intel used to be, you know, kind of

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<v Speaker 16>really strong in the server market, and you know, all

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<v Speaker 16>of those server investments, well most of them now really

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<v Speaker 16>going towards AI powered technology, which is not a not

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<v Speaker 16>a market that they're kind of really strong in.

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<v Speaker 2>Well, it's turned to Amazon, where they've been focused on

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<v Speaker 2>cost cuts for quite a few months now, Andy Jasse,

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<v Speaker 2>the CEO, saying that he's gonna put profits on the

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<v Speaker 2>back burner to really ramp up AI spending. How much

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<v Speaker 2>catch up does Amazon have to play with some of

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<v Speaker 2>the other players in the AI space.

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<v Speaker 16>Yeah, I don't think they're playing catch up. They're just

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<v Speaker 16>kind of matching all of the other big heavyweights, you

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<v Speaker 16>dollar for dollar. You know, the market leader in cloud

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<v Speaker 16>service has been investing for some time in AI. And

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<v Speaker 16>you know, we've had a very familiar story from all

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<v Speaker 16>of the big tech rivel So, you know, I think Microsoft,

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<v Speaker 16>think Meta, Think Alphabet, Google, They're all investing huge billions

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<v Speaker 16>of dollars to build their AI technology platforms for the

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<v Speaker 16>mid to long term. You know, the revenue is coming through,

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<v Speaker 16>but it's not coming through that quickly. But they all

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<v Speaker 16>know that if they don't develop their technology platforms today,

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<v Speaker 16>they'll miss out on a big show of the market

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<v Speaker 16>in the midterm. And that's essentially what they're doing.

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<v Speaker 2>I mean, while Apple is kind of bucking the overall

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<v Speaker 2>sell off trend trading a little changed right now. They've

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<v Speaker 2>delayed the rollout of their AI features, But is that

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<v Speaker 2>going to be enough to spur this upgrade cycle that

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<v Speaker 2>so many have been talking about.

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<v Speaker 16>Well, yeah, I mean, you know, the the the AI

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<v Speaker 16>features Apple Intelligence will start to come through in iPhone

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<v Speaker 16>sixteen and so I think you know that that is

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<v Speaker 16>really the next big focus for investors with Apple. If

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<v Speaker 16>we looked at the quarter they just reported, iPhone stalls

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<v Speaker 16>were still down slightly about one percent, but o there's

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<v Speaker 16>a big improvement on the previous quarter. And obviously what

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<v Speaker 16>they need to do, given that's you know, give or

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<v Speaker 16>take fifty percent of their revenues, is get iPhone sales

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<v Speaker 16>growing again. And you know, the product's refresh cycle and

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<v Speaker 16>I guess a smartphone upgrade supercycle is what they need.

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<v Speaker 16>And you know, the big hope is that intelligence or

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<v Speaker 16>artificial intelligence features on the device and their slightly differentiated,

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<v Speaker 16>unique way of offering AI is going to be enough

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<v Speaker 16>to kind of get more customers to to upgrade.

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<v Speaker 2>I'm Nathan Hager and.

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