WEBVTT - Oracle Cloud Sales; Adobe Forecast Miss; Microsoft Data Centers

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<v Speaker 1>Bloomberg Audio Studios. Podcasts. Radio. News. The Stock Movers Report,

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<v Speaker 1>your roundup of companies making moves in the stock market,

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<v Speaker 1>harnessing the power of Bloomberg data.

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<v Speaker 2>Let's take a look at some stocks on the move today.

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<v Speaker 2>I'm Nathan Hager, joined by Bloomberg's Ewan Potts, starting us

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<v Speaker 2>off with the biggest gainer pre-market. There was a lot

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<v Speaker 2>of trepidation, I think, going into Oracle's earnings. And just

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<v Speaker 2>looking at the stock action this morning, maybe those worries

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<v Speaker 2>were alleviated.

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<v Speaker 1>Good morning, Ewan.

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<v Speaker 3>Good morning, Nathan. Yes, solidly in the green, Oracle's cloud

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<v Speaker 3>computing business grew faster than analysts projected, suggesting the company's

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<v Speaker 3>big bets on AI data center projects are paying off. Oracle,

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<v Speaker 3>long known, of course, for its database software, has refreshed

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<v Speaker 3>itself as a provider of computing power for artificial intelligence work.

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<v Speaker 3>It's embarking on a major build out of data centers

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<v Speaker 3>for open AI and other customers. Sales in the closely

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<v Speaker 3>watched cloud infrastructure business jumped 121% year on year, Shares

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<v Speaker 3>have had a bit of a rough run recently, losing 38%

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<v Speaker 3>since this year's high back at the beginning of June.

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<v Speaker 3>That's on concerns over financing needs, rising component costs, and

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<v Speaker 3>news reports of data center construction challenges. Latest earnings clearly

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<v Speaker 3>going down well with investors up just over 7% in

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<v Speaker 3>the pre-markets.

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<v Speaker 2>Latest earnings for Adobe are going down, literally.

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<v Speaker 3>Yeah. Not such a rosy picture over Adobe. Yeah, the

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<v Speaker 3>software maker has given up an outlook for sales, which

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<v Speaker 3>narrowly missed analyst estimates. And that's adding fuel to concerns

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<v Speaker 3>that AI upstarts is hurting Adobe's business. Of course, it's

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<v Speaker 3>known for tools like Photoshop. Adobe software has long been

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<v Speaker 3>the standard for creative and marketing professionals, but generative AI

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<v Speaker 3>has made it easier to produce visual media without the

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<v Speaker 3>company's quite expensive products. Adobe says that it stands to

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<v Speaker 3>benefit from the shift to AI And annual recurring revenue

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<v Speaker 3>from AI-first products is up more than 150% as of

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<v Speaker 3>last quarter. But a bit of a damp reaction to

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<v Speaker 3>the numbers today. Shares down just under 4% in the pre-market.

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<v Speaker 3>All right.

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<v Speaker 2>So that's some of the tech earnings. But another big

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<v Speaker 2>tech company is getting a lot of attention with its

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<v Speaker 2>plans to really push into data centers. Tell us what's

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<v Speaker 2>happening with Microsoft.

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<v Speaker 3>Yeah, interesting. This is a Bloomberg scoop for you, Nathan.

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<v Speaker 3>Microsoft is planning to more than triple its data center capacity,

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<v Speaker 3>something that could help it overcome a computing shortage that's

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<v Speaker 3>been forcing it to turn away some AI and cloud

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<v Speaker 3>business customers. We're told that Microsoft plans to have more

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<v Speaker 3>than 38 gigawatts of global data center capacity by 2032.

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<v Speaker 3>And that is up from about 12 gigawatts now. And

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<v Speaker 3>just to put that number into a bit of perspective,

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<v Speaker 3>that would eclipse the total amount of electricity that New

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<v Speaker 3>York State uses during peak periods. So quite a lot

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<v Speaker 3>of data center capacity coming online for Microsoft. It's all part,

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<v Speaker 3>of course, of the $ 2. 4 trillion that the big four

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<v Speaker 3>hyperscalers plan to spend on the AI build out over

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<v Speaker 3>the coming years. Much of that, of course, on data centers.

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<v Speaker 3>Microsoft shares just about in the green this morning.

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<v Speaker 2>Of course, we've been talking for so long about how

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<v Speaker 2>the chip companies have been really big beneficiaries of the

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<v Speaker 2>AI data center boom, the rise in memory costs as well,

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<v Speaker 2>and Micron Technologies making a bit of news on that score.

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<v Speaker 3>Yeah, from one of the biggest spenders to one of

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<v Speaker 3>the biggest recipients of all of this cash, Micron shares,

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<v Speaker 3>of course, up more than 500% over the course of

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<v Speaker 3>the past year. They reported a 15-fold gain in net

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<v Speaker 3>income in the latest quarter. The news on the Bloomberg

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<v Speaker 3>terminal this morning that the US company has agreed a

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<v Speaker 3>payout to its staff in Taiwan who have been demanding

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<v Speaker 3>a cut of all this lovely cash. They had to

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<v Speaker 3>get a $ 1 million cash bonus, Taiwanese dollars, that is,

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<v Speaker 3>Doesn't sound quite so juicy in USD. About US $ 31, 000.

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<v Speaker 3>They're also going to get additional stock rewards. So we'll

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<v Speaker 3>see if that settles the demands of the 15,000 people

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<v Speaker 3>who work for Micron in Taiwan.

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<v Speaker 1>Shares trading hard today. The Stock Movers Report from Bloomberg Radio.

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<v Speaker 1>Check back with us throughout the day for the latest

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<v Speaker 1>roundup of companies making news on Wall Street. And for

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