Meta & Amazon Surge; Apple Falls on China Concerns

Good morning. 0:00:03.080 --> 0:00:05.920 I'm Nathan Hager and I'm Karen Moscow. Here are the 0:00:05.960 --> 0:00:07.440 stories we're following today. 0:00:07.840 --> 0:00:11.200 The jump in Nasdaq futures follows better than expected earnings 0:00:11.200 --> 0:00:14.840 from both Amazon and Facebook parent Meta Platforms. Let's get 0:00:14.840 --> 0:00:18.400 the details from Bloomberg's John Tucker John Nathan Holidays. 0:00:18.400 --> 0:00:21.720 Spending online led to strong growth in sales and profit 0:00:21.760 --> 0:00:25.759 for Amazon, and the craze around artificial intelligence driving healthy 0:00:25.840 --> 0:00:29.200 sales and its cloud computing arm. Its profit last quarter 0:00:29.560 --> 0:00:33.159 surge to ten point six billion dollars. That's the strongest 0:00:33.159 --> 0:00:35.440 in two years, and it got there in part by 0:00:35.440 --> 0:00:39.400 cutting about thirty five thousand jobs. Facebook parent Meta reported 0:00:39.400 --> 0:00:42.600 fourth quarter results that beat expectations. They gave an outlook 0:00:42.640 --> 0:00:46.160 that's seen as strong. They also partly got there as 0:00:46.159 --> 0:00:49.080 a result of cost cutting. Meta cut head count by 0:00:49.159 --> 0:00:52.000 twenty two percent last year, and they also had money 0:00:52.040 --> 0:00:55.760 to spare, Meta unveiling plans for a fifty billion dollar 0:00:55.840 --> 0:00:59.880 stock buyback and even announcing its first ever quarterly dibenend. 0:01:00.360 --> 0:01:02.680 The two stocks have combined to serve by more than 0:01:02.680 --> 0:01:06.479 two hundred seventy billion dollars in pre market trading right now, 0:01:06.600 --> 0:01:10.520 Meta up more than eighteen percent Amazon is up about 0:01:10.600 --> 0:01:13.200 nine percent. John Tucker, Bloomberg Radio. 0:01:13.319 --> 0:01:15.680 Right, John, thanks Well, Meta investors are not the only 0:01:15.720 --> 0:01:18.759 ones reaping the benefits of the company's first ever dividend. 0:01:18.880 --> 0:01:22.640 Chief executive Mark Zuckerberg stands to receive a payout of 0:01:22.640 --> 0:01:25.880 about seven hundred million dollars a year. According to data 0:01:25.920 --> 0:01:29.000 compiled by Bloomberg, Zuckerberg holds about three hundred and fifty 0:01:29.080 --> 0:01:31.800 million shares, and that means he would take home about 0:01:31.840 --> 0:01:34.520 one hundred and seventy five million dollars in each quarterly 0:01:34.600 --> 0:01:35.880 payment before taxes. 0:01:36.160 --> 0:01:39.119 Well, Karen, it's a different earning story at Apple. Those 0:01:39.160 --> 0:01:42.720 shares are down about one percent. The company's latest quarterly 0:01:42.760 --> 0:01:47.040 results are triggering investor fears that Apple's losing clout in China, 0:01:47.400 --> 0:01:50.760 which generates roughly a fifth of its sales. Bloomberg's Emily 0:01:50.880 --> 0:01:53.600 Chang spoke with one of Apple's top executives after that 0:01:53.680 --> 0:01:54.400 earnings report. 0:01:54.760 --> 0:01:57.840 I did just speak with Apple CFO Luka Maastri. He said, 0:01:58.120 --> 0:02:00.440 we're not happy with it, but we know that China 0:02:00.560 --> 0:02:02.440 is the most competitive market in the world and we 0:02:02.520 --> 0:02:05.960 do still see a lot of long term opportunity there. 0:02:06.160 --> 0:02:09.639 He did call out that the iPhone declined less than 0:02:09.800 --> 0:02:13.120 the other product categories. That is, the iPhone did better 0:02:13.560 --> 0:02:16.200 than the other product categories. In China, he said that 0:02:16.200 --> 0:02:19.400 there they saw a record install base. They're still seeing 0:02:19.520 --> 0:02:23.639 strong growth in upgraders. But again, you know, this is 0:02:23.639 --> 0:02:25.880 a market that folks have been very concerned. 0:02:25.480 --> 0:02:28.840 About, and Bloomberg's Emily Chang says revenue from China plunged 0:02:28.880 --> 0:02:32.160 thirteen percent last quarter. That marked the worst decline since 0:02:32.200 --> 0:02:34.040 the twenty eighteen holiday season. 0:02:34.480 --> 0:02:37.480 Well, Nathan, the world's leading AI chip maker, is looking 0:02:37.520 --> 0:02:41.919 to grow overseas, and Videos CEO Jensen Huang says countries 0:02:42.000 --> 0:02:45.600 like India, Japan, France, and Canada are talking more about 0:02:45.600 --> 0:02:49.240 building what he calls sovereign AI capabilities. He says that 0:02:49.320 --> 0:02:53.960 focus on homegrown AI infrastructure will drive demand for invidious products. 0:02:54.120 --> 0:02:57.119 Has become abundantly clear to each one of the countries 0:02:57.200 --> 0:03:01.440 that their natural resource, which is the data of their country, 0:03:03.000 --> 0:03:07.640 should be refined and produce intelligence of their country for 0:03:07.680 --> 0:03:08.320 their country. 0:03:08.639 --> 0:03:12.000 And Video CEO Jensen Huong tells Bloomberg it's an America's 0:03:12.040 --> 0:03:15.200 interest for companies to win in overseas markets well. 0:03:15.240 --> 0:03:17.600 A big tech scribe in the spotlight this morning, Karen 0:03:17.600 --> 0:03:20.000 It is also a big day on the economic front. 0:03:20.080 --> 0:03:22.679 We get the highly anticipated jobs report for the month 0:03:22.720 --> 0:03:25.240 of January, and the median forecast is for a gain 0:03:25.320 --> 0:03:28.200 of one hundred and eighty five thousand jobs. We get 0:03:28.200 --> 0:03:30.320 a preview now from Bloomberg's Michael McKee. 0:03:30.360 --> 0:03:32.440 The FED is no longer expecting a big jump in 0:03:32.520 --> 0:03:35.800 unemployment and wants to see a strong labor market. Chairman 0:03:35.880 --> 0:03:38.760 J Powell said this week economists think they will get it. 0:03:39.160 --> 0:03:42.120 The forecast is for another month of large job gains, 0:03:42.360 --> 0:03:45.800 and while there is a slight tick up in unemployment scene, 0:03:46.040 --> 0:03:48.640 January should be the twenty fourth consecutive month with a 0:03:48.720 --> 0:03:52.040 jobless rate under four percent. What the numbers won't do 0:03:52.240 --> 0:03:55.040 is bring any action from the Central Bank. Although Powell 0:03:55.040 --> 0:03:57.840 suggests rake cuts are coming, he all but ruled out 0:03:57.880 --> 0:04:01.400 the next meeting in March. Michael Key, Bloomberg Radio. 0:04:01.640 --> 0:04:04.119 All right, Mike, thanks, And speaking of J. Powell, we'll 0:04:04.120 --> 0:04:06.520 hear more from the Fed chairman this weekend. He will 0:04:06.520 --> 0:04:10.120 appear on sixty Minutes on CBS this Sunday. The network 0:04:10.160 --> 0:04:13.800 says Powell will discuss inflation risks, expected rate cuts, and 0:04:13.880 --> 0:04:14.720 the banking system. 0:04:14.880 --> 0:04:18.120 Well Karen Monetary policies also in focus in Europe. Despite 0:04:18.200 --> 0:04:21.520 leaving rates unchanged yesterday, the Bank of England did open 0:04:21.560 --> 0:04:24.279 the door to interest rate cuts this year, but BOE 0:04:24.360 --> 0:04:27.560 Governor Andrew Bailey tells Bloomberg factors like Middle East turmoil 0:04:27.600 --> 0:04:30.240 and rising living standards could be inflationary. 0:04:30.440 --> 0:04:32.200 We haven't cleared a risk, by the way, a new 0:04:32.279 --> 0:04:34.880 risk actually, which is we're really reflecting obviously sort of 0:04:34.920 --> 0:04:36.800 tragic events of them, at least in the impact that 0:04:36.920 --> 0:04:41.000 can have for the Red Sea effects. So I think 0:04:41.080 --> 0:04:43.919 now the question is for us as really is for 0:04:44.000 --> 0:04:45.960 how long do we need to mind tine this stance 0:04:46.400 --> 0:04:49.480 going forwards? You know, I've said a number of times 0:04:49.480 --> 0:04:52.360 we're going We're not making predictions. 0:04:51.720 --> 0:04:52.359 At this point. 0:04:52.600 --> 0:04:56.200 BOE Governor Andrew Bailey's comments come as the Monetary Policy 0:04:56.200 --> 0:04:58.599 Committee in the UK saw its first member vote to 0:04:58.640 --> 0:05:00.840 cut rates since the Panda Well. 0:05:00.839 --> 0:05:03.360 Turning back to the markets, Nathan, we continue to follow 0:05:03.400 --> 0:05:06.240 shares of New York Community Bank Corp. They've tumbled for 0:05:06.279 --> 0:05:09.760 two straight days as well. Street downgrades piled up and 0:05:09.839 --> 0:05:13.080 Moody's put the lender on review for a credit rating cut. 0:05:13.320 --> 0:05:15.920 The stock is trading at its lowest level since two thousand. 0:05:15.960 --> 0:05:19.599 It's sank eleven percent yesterday, adding to Wednesday's record thirty 0:05:19.640 --> 0:05:21.400 eight percent plunge. 0:05:20.920 --> 0:05:23.200 And shares of Clorox are up more than seven percent 0:05:23.200 --> 0:05:25.960 in early trading. Careen, the company, which makes Pine salt 0:05:26.000 --> 0:05:29.359 surface cleaners and Glad trash bags, is raising its sales 0:05:29.400 --> 0:05:32.440 and profit forecast for the year. Clorox has restocked its 0:05:32.480 --> 0:05:36.800 inventory rapidly following a cyber hack that paralyzed its manufacturing 0:05:36.839 --> 0:05:37.880 operations last. 0:05:37.760 --> 0:05:41.640 Year, and Nathan Visa said it blocked a record amount 0:05:41.640 --> 0:05:45.080 of suspected fraud last year. The San Francisco based payments 0:05:45.160 --> 0:05:48.240 giant says it blocked forty billion dollars worth, and that's 0:05:48.240 --> 0:05:51.279 nearly double the twenty three billion scene in the year before. 0:05:51.720 --> 0:05:54.400 Visa says block transactions in the US were out more 0:05:54.440 --> 0:05:57.880 than four hundred and fifty percent year on year in December. 0:06:01.000 --> 0:06:02.200 Time now for a look at some of the other 0:06:02.279 --> 0:06:04.400 stories making news around the world. For that, we're joined 0:06:04.400 --> 0:06:07.960 by Bloomberg's Amy Morris Amy, Good morning, Good morning, Karen. 0:06:08.040 --> 0:06:10.719 Senate negotiators are closing in on a deal now that 0:06:10.760 --> 0:06:13.880 would address the southern border and send aid to Israel 0:06:13.960 --> 0:06:18.159 and Ukraine. Bloomberg's Nancy lyons with the latest Senate. 0:06:17.880 --> 0:06:21.159 Majority Leader Chuck Schumer sounded optimistic during a speech on 0:06:21.200 --> 0:06:22.080 the Senate floor. 0:06:22.200 --> 0:06:26.880 Conversations are ongoing, some issues still need resolution, but we 0:06:26.920 --> 0:06:31.279 are getting very close on the National Security supplemental. 0:06:30.839 --> 0:06:33.480 Schumer says the text of the proposal will be ready 0:06:33.560 --> 0:06:36.400 no later than Sunday, with the vote planned for midweek. 0:06:36.960 --> 0:06:40.240 It's expected to provide money for more border agents, as 0:06:40.279 --> 0:06:42.839 well as grant the president new powers to expedite the 0:06:42.880 --> 0:06:47.560 deportation of undocumented migrants, and also titan criteria for applying 0:06:47.600 --> 0:06:50.919 for asylum in Washington, Nancy lyons Bloomberg Radio. 0:06:51.040 --> 0:06:54.080 Meanwhile, the acting head of Immigration and Customs Enforcement has 0:06:54.160 --> 0:06:56.920 revealed a big operation resulting in one hundred and seventy 0:06:56.920 --> 0:07:00.679 one arrests in more than two dozen cities. ISA director 0:07:00.880 --> 0:07:05.240 Patrick Lechligner praised the agency's officers, who he said, work 0:07:05.279 --> 0:07:07.599 hard despite having few resources. 0:07:07.680 --> 0:07:10.640 We're working with the Department and Administration and our partners 0:07:10.640 --> 0:07:12.960 obviously in Congress from appropriations. 0:07:13.240 --> 0:07:15.800 Listen, we need more resources and we're working to get 0:07:15.840 --> 0:07:16.280 that as. 0:07:16.160 --> 0:07:16.800 Hard as we can. 0:07:16.920 --> 0:07:18.880 Leck Liner warned his team may have to make some 0:07:18.920 --> 0:07:22.400 tough decisions if Congress does not provide more funding by March. 0:07:22.920 --> 0:07:26.440 President Biden meanwhile falling out of favor with minority voters. 0:07:26.440 --> 0:07:29.200 A new poll done in Texas shows Donald Trump holds 0:07:29.240 --> 0:07:32.000 a six point lead among Hispanics. Mark Jones ran the 0:07:32.040 --> 0:07:33.600 poll for the University of Houston. 0:07:33.680 --> 0:07:37.440 While Biden handily defeated Trump among Latinos back in twenty twenty, 0:07:37.600 --> 0:07:41.080 now they're effectively tied, with Trump having a fight advantage. 0:07:41.160 --> 0:07:44.280 Jones says the president is losing Latino support along the border, 0:07:44.400 --> 0:07:47.480 where the states push to stop illegal immigration is popular. 0:07:48.080 --> 0:07:50.640 Votors in South Carolina are said to cast the first 0:07:50.640 --> 0:07:54.040 ballots in the Democratic primary tomorrow. The Palmetto state was 0:07:54.160 --> 0:07:57.800 essential in helping Biden's twenty twenty campaign turn around. Valley 0:07:57.800 --> 0:08:01.640 Brook outreached Baptist Church pastor Curtis Johnson is concerned about 0:08:01.680 --> 0:08:05.200 the lack of enthusiasm among black voters this time around. 0:08:05.320 --> 0:08:09.000 I am concerned about lack of enthusiasm. I am concerned 0:08:10.440 --> 0:08:14.800 that so many about a community, and I understand feeling 0:08:14.840 --> 0:08:16.440 that some of the issues that are more relevant to 0:08:16.520 --> 0:08:17.640 us and not being addressed. 0:08:17.840 --> 0:08:20.320 More than twenty two percent of South Carolinians planning to 0:08:20.400 --> 0:08:23.720 vote in the Democratic primary tomorrow said they were undecided 0:08:23.760 --> 0:08:27.040 on which candidate would receive their vote. Global news twenty 0:08:27.040 --> 0:08:28.880 four hours a day and whenever you want it with 0:08:28.920 --> 0:08:32.760 Bloomberg News Now, I maybe Morris and this is Bloomberg Kear. 0:08:32.880 --> 0:08:34.760 Right, Amy. Thanks. We do bring you news throughout the 0:08:34.800 --> 0:08:37.120 day right here on Bloomberg Radio. But now you can 0:08:37.120 --> 0:08:39.800 get the latest news on demand whenever you want it. 0:08:40.160 --> 0:08:42.640 Just subscribe to Bloomberg News Now to get the latest 0:08:42.640 --> 0:08:45.320 headlines of the click of a button. Get informed on 0:08:45.520 --> 0:08:48.720 your schedule. You can listen and subscribe to Bloomberg News 0:08:48.720 --> 0:08:53.120 Now on the Bloomberg Business app, Bloomberg dot Com, plus apples, Spotify, 0:08:53.480 --> 0:09:00.360 and anywhere else you get your podcasts. I'm now for 0:09:00.400 --> 0:09:02.720 the Bloombergy Scores update with Dan Schwartzman. 0:09:02.960 --> 0:09:04.439 Dan, Good morning, Karen. 0:09:04.520 --> 0:09:06.320 Round two of the eighteen and T Pebble Beach Pro 0:09:06.400 --> 0:09:09.040 Am coming up later this morning. Thomas Detria topped the 0:09:09.080 --> 0:09:12.280 leaderboard after the first round at nine under in second 0:09:12.280 --> 0:09:16.840 American Patrick Canley in third place Matthew Pavon at seven under. Meanwhile, 0:09:16.840 --> 0:09:19.440 big trade in Major League Baseball the Baltimore Orioles acquiring 0:09:19.480 --> 0:09:22.559 former Cy Young Award winner Corbyn Burns from the Milwaukee 0:09:22.559 --> 0:09:26.040 Brewers in return the Oriols shipping to Milwaukee Joey Ortiz, 0:09:26.080 --> 0:09:28.560 an infielder left handed DL Hall, as well as the 0:09:28.600 --> 0:09:32.079 thirty fourth pick in the twenty twenty four draft. Burns 0:09:32.120 --> 0:09:33.880 coming off the season of going ten and eight for 0:09:33.920 --> 0:09:36.480 three point three nine ERA and two hundred tricads in 0:09:36.480 --> 0:09:39.000 a little over one hundred ninety three innings. Burns will 0:09:39.000 --> 0:09:42.200 be a free agent after next year. NBA scoreboard. Big 0:09:42.240 --> 0:09:44.160 win by the Lakers as they went on the road 0:09:44.200 --> 0:09:44.760 in Boston. 0:09:45.280 --> 0:09:47.640 Here's a dry by Reeves slips it by the back 0:09:47.640 --> 0:09:50.920 of the corner to Princes, drives the baseline, skips at Hatchamurra. 0:09:50.760 --> 0:09:53.479 Up top, it goes the're all solo train till three. 0:09:53.600 --> 0:09:56.280 That's courtesy of ESPN. Boston losing at home to the 0:09:56.400 --> 0:09:59.480 Lakers one fourteen to one oh five. The Knicks continue 0:09:59.480 --> 0:10:01.559 to be red hot. Day now won nine trade I 0:10:01.640 --> 0:10:03.640 come from behind one o nine one oh five home 0:10:03.679 --> 0:10:07.079 win over the Indiana Pacers. Jalen Brunson forty points in 0:10:07.120 --> 0:10:09.360 the win for New York Cavaliers. A one eight one 0:10:09.400 --> 0:10:11.360 oh one win over the Grizzlies in Memphis. All the 0:10:11.400 --> 0:10:14.120 seventy six Ers slip past the Utah Jazz one twenty 0:10:14.160 --> 0:10:17.200 seven to one twenty four. Speaking of the Sixers, big 0:10:17.240 --> 0:10:20.400 news as reigning league MVP Joel Embiid will be missing 0:10:20.400 --> 0:10:23.240 some time after he suffered a lateral meniscus injury in 0:10:23.320 --> 0:10:26.080 his left knee when Ford Jonathan Comingo the Golden State 0:10:26.080 --> 0:10:29.040 Warriors fell on his leg on Tuesday, and Beid's going 0:10:29.120 --> 0:10:31.080 to be out the rest of the weekend. Treatment options 0:10:31.120 --> 0:10:34.040 are being thought out. That's your Bloomberg Sports update. I'm 0:10:34.080 --> 0:10:35.240 Dan Schwartzman. 0:10:37.160 --> 0:10:40.160 From coast to coast, from New York to San Francisco, 0:10:40.480 --> 0:10:45.120 Boston to Washington, DC, nationwide on Syrias Exam, the Bloomberg 0:10:45.160 --> 0:10:49.320 Business app, and Bloomberg dot Com. This is Bloomberg day Break. 0:10:50.520 --> 0:10:53.760 Good morning. I'm Nathan Hager. Big tech remains a big 0:10:53.800 --> 0:10:57.920 focus for investors. We got earnings after the bell yesterday 0:10:57.960 --> 0:11:02.000 from Apple, Amazon, and Metal platforms for Amazon and Meta. 0:11:02.120 --> 0:11:06.000 Cost cutting and restrategizing seem to be paying off, and 0:11:06.160 --> 0:11:10.080 even Apple has gotten a return to growth, but that's 0:11:10.120 --> 0:11:13.200 getting overshadowed just a bit by a slowdown in China. 0:11:13.400 --> 0:11:15.680 Let's get more on these tech earnings now. We're joined 0:11:15.720 --> 0:11:19.120 by Bloomberg's Alex Webb and Alex. Let's start off with 0:11:19.160 --> 0:11:24.040 Meta because that stock is really getting attention this morning, 0:11:24.080 --> 0:11:27.000 a big surge in the shares. Is this just all 0:11:27.040 --> 0:11:29.160 about the fact that investors are going to get a 0:11:29.160 --> 0:11:30.240 dividend for the first time. 0:11:31.200 --> 0:11:34.079 I'm sure that is a big factor. It's kind of interesting. 0:11:34.800 --> 0:11:38.800 It's almost like the final pillar in a pivot. Well, 0:11:38.800 --> 0:11:40.319 I don't if it's final way with that we do more, 0:11:40.360 --> 0:11:43.840 but it's another pillar in this pivot away from being 0:11:43.840 --> 0:11:46.280 perceived just as an outright growth stock. Right that the 0:11:46.920 --> 0:11:49.840 obviously we've seen in over the past year or so 0:11:49.960 --> 0:11:53.160 that growth stocks aren't being rewarded in quite the same way. 0:11:53.520 --> 0:11:55.880 People are looking for something a little bit different, and 0:11:56.400 --> 0:12:00.600 we've seen Meta really focus on a thing. It had 0:12:00.640 --> 0:12:03.520 its so called year of efficiency last year. It cut 0:12:03.600 --> 0:12:07.920 a lot of jobs. The comments from Mark Zuckerberg yesterday 0:12:07.920 --> 0:12:10.120 with that he's not looking to do any meaningful hiring 0:12:10.160 --> 0:12:12.040 this year doesn't mean they're not spending money. They are 0:12:12.040 --> 0:12:14.840 spending quite a lot on you know, things like the 0:12:14.880 --> 0:12:20.480 metaverse and AI, but that doesn't necessarily mean more headcount. Ultimately, 0:12:20.520 --> 0:12:26.320 the actual core advertising business didn't do brilliantly but the 0:12:26.400 --> 0:12:30.320 overall earnings, you know, it was a significant beat on 0:12:30.400 --> 0:12:33.000 the top line, and this this cherry on the cake 0:12:33.040 --> 0:12:33.959 in the form of the dividend. 0:12:34.160 --> 0:12:36.760 We did get a pretty strong forecast, though, didn't we 0:12:36.800 --> 0:12:40.920 When it comes to the ad market, that core business 0:12:40.960 --> 0:12:45.600 for Meta platforms, does that say something about whether they 0:12:45.640 --> 0:12:48.560 can pull off this pivot that, at least as far 0:12:48.640 --> 0:12:52.120 as the metaverse has gone for Meta hasn't really been 0:12:52.200 --> 0:12:54.120 rewarded so far from Mark Zuckerberg. 0:12:54.880 --> 0:12:58.959 No, although the Reality Labs business, which is what they're doing, 0:12:59.320 --> 0:13:02.920 you know, that's where the virtuality headsets come from, did 0:13:02.960 --> 0:13:04.599 post its first quarter where it had more than a 0:13:04.600 --> 0:13:09.679 billion dollars in revenue. Ultimately, the question has been is 0:13:09.720 --> 0:13:14.720 the ads market resilient enough to be able to sustain 0:13:15.040 --> 0:13:18.680 the cash expense on all these new technologies, And the 0:13:18.720 --> 0:13:20.880 message seems to be yes. It is a lot of 0:13:20.920 --> 0:13:25.800 the business appears to be coming from particularly Chinese direct 0:13:25.800 --> 0:13:29.880 to consumer websites names like she In for instance, that 0:13:29.960 --> 0:13:31.720 have actually been in some way has been taking chunks 0:13:31.720 --> 0:13:34.200 out of Amazon. But of course to find their customers, 0:13:34.200 --> 0:13:39.080 they are using platforms, many of Meta's platforms, in particular Instagram. 0:13:39.800 --> 0:13:43.319 Let's talk about Amazon had a blowout holiday quarter. What's 0:13:43.360 --> 0:13:45.040 the big takeaway from those results for you? 0:13:45.800 --> 0:13:49.120 Again, it's a similar story to Meta that they have 0:13:49.200 --> 0:13:51.760 been focusing on costs to a far greater extent than 0:13:51.760 --> 0:13:56.920 we've seen previously. They've cut fair number of jobs, but 0:13:57.600 --> 0:14:00.920 in things like Prime Video and Twitch, which is its 0:14:01.240 --> 0:14:05.440 game streaming service to you to watch games being live streamed. 0:14:07.080 --> 0:14:11.560 The numbers, but thirty five thousand jobs have cut obviously 0:14:11.760 --> 0:14:15.440 significant impact on the poor people who've lost their jobs. 0:14:15.559 --> 0:14:19.080 But in the grand scheme of things, Apple, Amazon sorry, 0:14:19.120 --> 0:14:21.200 employs one and a half million people in full time 0:14:21.240 --> 0:14:25.840 part time roles, so you know, the numbers themselves pretty 0:14:25.880 --> 0:14:29.920 much met expectations. There was, you know, this online sales 0:14:30.040 --> 0:14:33.320 pretty much in line with expectations. Same with Amazon Web services. 0:14:34.400 --> 0:14:37.880 The good thing for investors when you look at AWS 0:14:38.040 --> 0:14:39.880 is that there had been a little bit of concern 0:14:39.920 --> 0:14:42.880 that maybe it wasn't as strong in AI as Microsoft 0:14:42.960 --> 0:14:45.560 and Google, who have really been making good headway there 0:14:46.280 --> 0:14:49.560 doesn't seem to have had too detrimental an effect on 0:14:49.640 --> 0:14:53.240 the growth in AWS, So you know, that is a 0:14:53.280 --> 0:14:57.040 little certainly a bright spot for investors now. 0:14:57.080 --> 0:15:00.800 It's so bright though for Apple investors, getting a bit 0:15:00.840 --> 0:15:03.800 of a dip even after returning to growth for the 0:15:03.840 --> 0:15:05.960 first time, and I think four quarters. 0:15:06.680 --> 0:15:07.000 Yeah, it. 0:15:08.520 --> 0:15:13.520 Beat estimates on the revenue line. Much of that was 0:15:13.520 --> 0:15:16.320 seemed to be to do with Europe, where it did 0:15:16.480 --> 0:15:20.880 far better than the street had been expecting. But China 0:15:20.960 --> 0:15:22.800 is a big disappointment. People knew that it was going 0:15:22.840 --> 0:15:26.320 to be bad. There's a certain upswell in patriotism there, 0:15:26.360 --> 0:15:29.040 particularly when it comes to buying mobile phones. We saw 0:15:29.040 --> 0:15:31.040 this or smartphones. We saw the six or seven years 0:15:31.040 --> 0:15:33.360 ago where Apple took a bit of a hit in 0:15:33.440 --> 0:15:36.960 China as local brands such as Oppo, Viva at the time, 0:15:37.120 --> 0:15:41.760 Silmi and Huawei took share out of Apple. It looks 0:15:41.800 --> 0:15:45.560 like that is happening again. Analysts had been expecting about 0:15:45.560 --> 0:15:48.600 twenty three and a half billion dollars in sales in China. 0:15:48.640 --> 0:15:50.440 In the end it was less than twenty one billion. 0:15:50.920 --> 0:15:54.120 And the commentary looking forward doesn't seem all that bullish 0:15:54.160 --> 0:15:55.080 for that market either. 0:15:55.560 --> 0:15:57.920 Just thirty seconds left Alex But could we see Apple 0:15:57.960 --> 0:16:00.520 get more love later on today when the vis Pro 0:16:00.720 --> 0:16:02.040 finally hits stores. 0:16:03.440 --> 0:16:05.400 I think the thing about the Vision Pro is is 0:16:05.440 --> 0:16:07.840 really a statement piece that shows says Apple we are 0:16:07.840 --> 0:16:10.080 still leading technologically, right, it's not going to make any 0:16:10.120 --> 0:16:12.960 meaningful difference to their earnings in the near term, maybe 0:16:12.960 --> 0:16:14.800 in the media term. And the other piece to that, 0:16:14.880 --> 0:16:16.960 of course, is that Apple doesn't need it to be 0:16:16.960 --> 0:16:18.760 a success per se. It just needs it to do 0:16:18.840 --> 0:16:20.800 better than whatever Meta comes out with. 0:16:20.920 --> 0:16:21.040 Right. 0:16:21.080 --> 0:16:24.320 If Meta were to somehow own this space of virtuality 0:16:24.360 --> 0:16:26.600 augmented reality, that would be a big problem for Apple. 0:16:26.760 --> 0:16:28.960 But if none of them are successful, then ultimately it's 0:16:28.960 --> 0:16:30.120 not the end of the world for Tim Cook. 0:16:30.440 --> 0:16:33.160 Bringing it right around to the competition, the fierce competition 0:16:33.280 --> 0:16:38.480 around wearables and AI in this big tech space. Thank 0:16:38.520 --> 0:16:41.560 you for this as always, Alex Webb of Bloomberg News. 0:16:41.800 --> 0:16:43.840 Well, Nathan, he did mention AI, and a lot of 0:16:43.840 --> 0:16:46.680 the excitement around these megacap names has been driven by 0:16:46.680 --> 0:16:50.280 the promise of artificial intelligence, and there is no bigger 0:16:50.360 --> 0:16:53.560 chip maker in that space than Nvidia now, the semiconductor 0:16:53.640 --> 0:16:57.200 maker CEO Jensen Wong says demand for his company's products 0:16:57.200 --> 0:17:00.160 will be driven not just by its current customer is 0:17:00.160 --> 0:17:03.440 in the Magnificent seven. He's pointing to companies and governments 0:17:03.520 --> 0:17:07.160 overseas andming to build and run their own homegrown AI 0:17:07.320 --> 0:17:11.119 infrastructure in media CEO Jensen Wog disgusted with the Bloomberg 0:17:11.160 --> 0:17:14.240 Technology co host and Ludlow, and let's listen into part 0:17:14.240 --> 0:17:15.040 of that conversation. 0:17:15.200 --> 0:17:16.280 Now you have. 0:17:16.320 --> 0:17:25.639 Seen India, Japan, and France, Canada, now Southeast Asia, Singapore 0:17:26.359 --> 0:17:31.160 speak up about the importance of investing in sovereign AI capabilities. 0:17:32.160 --> 0:17:35.080 It has become abundantly clear to each one of the 0:17:35.119 --> 0:17:39.240 countries that their natural resource, which is the data of 0:17:39.280 --> 0:17:45.240 their country, should be should be refined and produce intelligence 0:17:45.280 --> 0:17:49.760 of their country for their country. And that capability of 0:17:49.840 --> 0:17:52.280 refining the data of their country, of their country and 0:17:52.359 --> 0:17:56.159 turn it into their artificial intelligence is now possible in 0:17:56.880 --> 0:17:59.960 quite a quite a democratized way. Almost every country should 0:17:59.960 --> 0:18:03.679 be able to do it for themselves. And and what's needed, 0:18:03.720 --> 0:18:07.159 of course is the technology and the know how of 0:18:07.480 --> 0:18:10.640 standing up AI infrastructure. And that's where we could be 0:18:10.880 --> 0:18:14.920 quite helpful to to various regions. And so I think 0:18:14.920 --> 0:18:18.720 that the the recognition of the importance of sovereign AI 0:18:18.760 --> 0:18:21.520 capabilities is now quite quite global. 0:18:21.720 --> 0:18:25.120 Jensen, does that recognition and your ability to help extend 0:18:25.160 --> 0:18:26.320 to China, Well. 0:18:26.200 --> 0:18:30.040 We're American company, and we have to comply with American policies, 0:18:30.240 --> 0:18:33.520 and whatever the rules and regulations are and the laws are, 0:18:33.960 --> 0:18:37.159 will number one, comply with them. Work closely with the 0:18:37.200 --> 0:18:43.440 regulators and understand understand their intentions and their desires, work 0:18:43.480 --> 0:18:47.520 within those boundaries, and be able to create products for 0:18:47.520 --> 0:18:52.080 for the various countries that are involved, fully in compliant 0:18:52.160 --> 0:18:55.400 with the regulations that are that are in front of us, 0:18:56.240 --> 0:18:59.959 and beyond that once we once we comply, our goal 0:19:00.040 --> 0:19:02.439 are in the United States would love to see us 0:19:02.640 --> 0:19:06.160 be a successful country and in one of the pillars 0:19:06.200 --> 0:19:10.040 of national security of successful industries, and it creates jobs 0:19:11.080 --> 0:19:15.160 and allows our country to stay ahead and technologically. 0:19:15.200 --> 0:19:15.520 And so. 0:19:17.880 --> 0:19:21.080 It is of a great interest of our nation that 0:19:21.160 --> 0:19:24.239 our American companies are successful around the world. And so 0:19:24.359 --> 0:19:27.280 once once we comply with the regulations, we'll do our 0:19:27.280 --> 0:19:31.560 best to serve the local markets. And we have full 0:19:32.640 --> 0:19:37.320 we have excellent communications with the administration. 0:19:37.520 --> 0:19:42.000 How should we think about sovereign AI as a business 0:19:42.040 --> 0:19:44.480 line for you? Is there a way that we can 0:19:44.640 --> 0:19:48.920 understand how in videos work, even if it's building supercomputers 0:19:48.960 --> 0:19:52.080 like in the UK, for example, what proportion of your 0:19:52.080 --> 0:19:54.560 overall business that will represent. 0:19:54.480 --> 0:19:59.159 The vast majority of the computing market has been the 0:19:59.280 --> 0:20:03.040 United States and to a small to a much longer, 0:20:03.080 --> 0:20:07.960 smaller degree, China. For the very first time, every industry 0:20:08.040 --> 0:20:11.880 would be every single country will become a computer industry, 0:20:12.040 --> 0:20:15.560 and every industry will become a technology industry. And so 0:20:15.760 --> 0:20:21.000 artificial intelligence or the automation uh the production at scale 0:20:21.040 --> 0:20:24.760 of intelligence matters to every single country. It matters to 0:20:24.800 --> 0:20:27.359 every single industry. And so for the very first time, 0:20:27.400 --> 0:20:31.520 there's a there's a whole new computer market that is 0:20:31.560 --> 0:20:34.320 going to be uh in in every single country, in 0:20:34.320 --> 0:20:38.800 every single every single market. And UH it starts with 0:20:39.000 --> 0:20:44.480 it starts with, of course, uh the native computer industry itself. 0:20:45.160 --> 0:20:48.440 But you're seeing you're seeing a great adoption in healthcare, 0:20:48.520 --> 0:20:53.720 great adoption and logistics uh in, UH in transportation, of course, 0:20:54.359 --> 0:20:57.720 uh in manufacturing, in the large industries, the heavy industries. 0:20:58.160 --> 0:21:01.480 UH For the very first time, because of Jariti AI, 0:21:02.119 --> 0:21:05.000 computers are going to be computer technology is going to 0:21:05.040 --> 0:21:08.399 impact literally every single industry in every single country. 0:21:09.840 --> 0:21:12.760 This is Bloomberg day Break Today, your morning brief on 0:21:12.800 --> 0:21:16.360 the stories making news from Wall Street to Washington and beyond. 0:21:16.640 --> 0:21:19.399 Look for us on your podcast feed at six am 0:21:19.480 --> 0:21:23.119 Eastern each morning, on Apple, Spotify, and anywhere else you 0:21:23.200 --> 0:21:24.399 get your podcasts. 0:21:24.480 --> 0:21:27.200 You can also listen live each morning starting at five 0:21:27.240 --> 0:21:29.880 am Wall Street Time, on Bloomberg eleven three to zero 0:21:29.880 --> 0:21:32.680 in New York, Bloomberg ninety nine to one in Washington, 0:21:32.840 --> 0:21:35.720 Bloomberg one oh six to one in Boston, and Bloomberg 0:21:35.800 --> 0:21:37.480 ninety sixty in San Francisco. 0:21:37.840 --> 0:21:41.000 Our flagship New York station is also available on your 0:21:41.040 --> 0:21:46.480 Amazon Alexa devices. Just say Alexa Play Bloomberg eleven thirty plus. 0:21:46.520 --> 0:21:49.919 Listen coast to coast on the Bloomberg Business app, SERIUSXM, 0:21:50.040 --> 0:21:54.320 the iHeartRadio app, and on Bloomberg dot Com. I'm Nathan Hager. 0:21:54.080 --> 0:21:57.199 And I'm Karen Moscow. Join us again tomorrow morning for 0:21:57.359 --> 0:21:59.760 all the news you need to start your day. Right 0:22:00.040 --> 0:22:03.359 You're on Bloomberg Daybreak