This is the Blueberg Data, a q AT podcast available every morning on Apple, Spotify or wherever you listen. It's Friday, the twenty sixth of April here in London. I'm Caroline HIPKIF.
And I'm Stephen Carroll. Coming up today. Shares in Alphabet and Microsoft rise as the tech giants in press investors with surging AI demand.
The yen plunges as the Bank of Japan leaves interest rates and bond buying unchanged.
And combining public success with private grief, Investor Peter Cowley shares his life lessons as he battles terminal cancer.
Let's start with a roundup of our top stories.
Shares in Microsoft and Alphabet have surged in after hours trading as the two tech titans released results showing investment in artificial intelligence and cloud computing is paying off. Google's parent company reported first quarter revenue that exceeded analysts expectations. Sales excluding partner payouts, rose to sixty seven point six billion dollars over the period. Chief financial officer Ruth poor That says AI services are increasingly fueling growth.
We are very pleased with our financial results for the first quarter, driven in particular by strength and search and cloud, as well as the ongoing efforts to durably re engineer our cost base.
Ruth poor out out of the Google Cloud results reflect broad strength across the industry.
The message was similar at Microsoft to where cloud and artificial intelligence offerings drove quarterly sales and profit growth at beat expectations. Third quarter revenue at the world's most valuable listed company rows seventeen percent to sixty one point nine
billion dollars. Microsoft has leveraged its investment in artificial intelligence pioneer open Ai to create a series of assistance and other features, and Chief financial Officer Amyhurd says that they will need to spend more money to keep up with demands twenty five.
That focused and execution should again lead to double digit revenue and operating income growth to scale to meet the growing demand signal for our cloud and AI products. We expect FY twenty five capital expenditures to be higher than FY twenty four.
As Amy heard mentioned there, Microsoft is spending heavily to expand its global network of data centers to meet rising demand for AI services. Capital expenditure reached fourteen billion dollars during the quarter.
The end as week into a new thirty four year low against the dollar after the Bank of Japan held interest rates steady. At its latest meeting, the boj simplified its language on bond buying, dropping a reference to how much it's purchasing per month. In its economic outlook. The central bank raised its inflation outlook for consumer prices excluding food to two point eight percent and said risks were
skewed to the upside. This is the first meeting since the Bank of Japan raised interest rates out of negative territory.
Air Boss will boost production of its Advance to a three point fifty jet amidst surging demand while rival Boeing struggles. According to first quarter figures, the European planemaker will produce twelve a three fifty jets per month by twenty twenty eight. That's an increase on previous plans to reach ten by twenty twenty six. But CEO Guium Fury says that airbuses supply chain is under pressure as orders from former Boeing customers come in.
So we are victims sort of of our own success. We have a lot of demand, the higher than the supply, and this will continue to stretch the supply chain for some years.
Airbus CEO gium Fouri speaking there. This week, Indian budget specialist indiego so that it signed a firm order for thirty A three fifty aircraft, with an option for as many as seventy more.
UK consumer confidence ed tires. Inflation has eased and made people more willing to spend. GfK's household Optimism index rows two points this month to minus nineteen. Bloomber Exchames Worldcock has more.
Things are looking brighter, more willingness to spend on big ticket items, less pessimism, and a feeling of financial security. That's what people surveyed told GfK in April, a month in which energy prices and inflation fell. It's likely to be extremely welcome news at number ten Downing Street, Prime Minister which you sunk, is counting on rising optimism about the economy to boost his election hopes. In London, James Wilcock with MUG Radio.
China's top diplomat says that problems are mounting in the country's relationship with the United States. The warning comes after the Biden administration vowed new tariffs on China. Wang Yi spoke via a translator.
The generous relationship is beginning to stabilize across the areas. Our two sides have increased the dialogue, cooperation and the passive side of the relationship. This is welcomed by our two peoples and the international community. But at the same time, the negative factors in the relationship is still increasing and building, and the relationship is facing all kinds of disruptions.
China's Foreign Minister Wang Yi speaking Vara translator, he is hosting US Sector of State Anthony Blincoln in Beijing. The senior White House official is expected to be challenged over the new US law to ban Chinese own TikTok if its parent company Byte Dance doesn't divest and.
To Israel says it's preparing its forces for a potential all out war with Hezbollah as the exchange of fire with the Iranian backed group intensifies. In a statement to the Israeli military said that local leaders in the area have been briefed quote on the processes to accelerate readiness for continued fighting. The news comes as Israel's Israeli forces struck forty Hezbeala sites on southern Lebanon on Wednesday, after the group conducted a deep aerial attack inside Israel. In
a moment, we'll dig into the tech earning story. We're also going to bring you ark exclusive interview with the investor Peter Cowley on his latest book, in which he shares his life lessons as he deals with a terminal
cancer diagnosis. We want to dwell for a moment. Two on today's boj decision, the first since they announced their rate rise last month, so they held rates at this meetinglight tweaks the language on bond buying, optic of the inflation outlook for the rest of the year, but the key message seems to be no sign of further easing for now anyway, Blue Edge Investors, Calvin, you are describing it as a nothing sushi, a plain white rice ball.
Yes, this is because a lot of Americans use this phrase a nothing burger, which is also kind of a funny phrase for me. But yeah, I like this one and nothing sushi. The issue, of course is, you know how Japan exits this policy without putting further pressure on
the Japanese yet businesses are concerned about it. You've got the Japanese economy really kind of faltering at the moment, and so very difficult rates are not to zero point one percent in Japan, so you know, trying to lift them above zero very tricky.
Yeah, indeed, I'm just watching the weekening at the end this morning, the Finance Ministry is saying they would deal with foreign exchange appropriately, but to climb to say whether the currency moves would be what they consider excessive.
Now to those tech earnings for Microsoft and Google owner Alphabet. Their results were all about the corporate customer and a surge in cloud revenue fueled by booming AI services. They needed a strong performance after shares in Meta tumbled on Thursday when the Facebook coner revealed it needed to invest billions more than expected on AI joining us. How to discuss is Bloomberg ancha, pritty Gupta, Great to see you
this morning, Good morning. How good then were Microsoft and Alphabet earnings seemed like really they were being very pointed about how well they're doing. From aar they.
Were and this is whatever. The opposite of a nothing burger is a swampburger, if you will. This is the kind of everything in more that you could that they could have delivered. I'll break it down by it by company here because one of the concerns for Meta simply was that this is a company that could not capitalize on the AI and was frankly late to the game in a way that Microsoft and Alphabet have really been investing for years and really are already the dominant player.
So that's why Meta's extra kind of capital expenditure was a negative. Amid that background, you have to kind of think about why Microsoft and Alphabet are under or outperforming because you're going in with expectations that, Okay, well, maybe the AI returns won't be as juicy. Boy were we wrong.
Because for Microsoft especially which has is considered the dominant player in AI right now, especially given their forty nine percent stake in Open ai as well, their cloud business is getting kind of a tailwind from the AI boom as well. People are really rushing into this and this is their Asia revenue that we really watch very very closely.
So they gained about thirty one percent in the quarter, which, by the way, massive growth rate, but this follows a little bit of a slowdown that you've seen in the past couple of quarters. The last one was thirty percent growth in the previous period, twenty nine percent before that, and the twenty nine percent prediction this time around is crucial as well. So this is coming in the backdrop of concerns at the Asia growth, which by the way,
has been so exponential, could be slowing down. Microsoft saying otherwise. In fact, it also helped their sales and helped their profit. That the AI story is really working for them and will continue to That seems to be the message out of Microsoft now. Alphabet, on the other hand, is going to be trying to gain a lot of market share,
especially in cloud, but also in AI. They've invested heavily in their deep Mind product as well, and by the way, losing some of their talent there to Microsoft, which has been poaching from the deep Mind project as well. For Alphabet's a little bit of different story because even though they posted some good numbers as well, arguably too good, they also talked about return to shareholders a first ever cash dividend of about twenty cents from the company plus
a seventy billion dollar stock buyback. Who wouldn't want to touch Alphabet when you put that kind of returns on it.
But these companies are also, like matter, going to need to invest a lot more in AI as well.
They are, they are and look, this is I think where it comes back down to are what companies are best positions to do it, Because any company can kind of use the AI phrasing and say we're going to hop in on this trend, but very few have the talent, the infrastructure, and the reach, by the way, So this is where Alphabet's kind of story is really important here as well, is because there's also the first quarter, excuse me, the second quarter where they've actually been profitable in their
AI business. That's a really big deal. I think the estimate by the analysts was a six hundred and twenty one million. They came out with nine hundred million, so they a pretty decent beat. But the profitability story is important because you can't go to scale, or at least have the kind of backing to go to scale to the mass market if you don't turn profitable, especially for a company like Alphabet. So this is really helping with that kind of move to get more market share.
Okay, so not on Microsoft, been on Alphabet. But it wasn't all good news. The ship maker Intel gave a pool full cost for this year. They did.
This is of course the biggest maker of personal computer processors, and we know Intel has been mired in this kind of turnaround story that does not seem to be turning around at any point. Here CEO really trying to look to restore that Pat gel singer. He's been at it for a couple of years now.
Well.
He says that the sales in the second quarter will be about thirteen billion dollars, which are actually coming in slightly less than the average analysessment about thirteen point six billion. And also the profit will be about ten cents a share versus a projection about twenty four cents, So seeing a real kind of loss when we're talking about how
much of that capital expenditure we're seeing. This is I think a great way to show that alphabet Microsoft can say, hey, we're spending a lot on R and D because we can't deploy an M and A. For example, Intel's actively near shoring a lot. They're getting a lot of grants from the US government. They're really trying to become more profitable and compete on a bigger stage, and right now these numbers to show this kind of cash burn isn't really working in their favor.
Crazy gup to Bloomberg TV anchor, Thanks so much for joining us at the details of those stories.
Now to a Bloomberg Radio exclusive. The Investor Peter Cowley has a third book out, The Cambridge Entrepreneur and Angel Investor is the author of the start up bestseller The handbook Really the Invested Investor. Now he's focused not on business but on his personal story, public success, private Grief. It charts Peter's struggles through alcoholism, the loss of two sons to suicide, and now a terminal cancer diagnosis. In his final book, one in which he puts his business
career into perspective. I went to Cambridge to meet Peter Cowley for a conversation about his life, the VC business and loss. I started by asking him what first drew him into his career.
Some people I didn't really realize that to start with, but once I got involved and started to have entrepreneurs were generally about half a generation to a generation younger than me so and nowadays generation to generation and a half.
Some people's spending time with those people the ones A good entrepreneur will listen because they have to listen to the market, they have to listen to soon as they have to listen to regulators, and sometimes they do a listen to investors as well, and they certainly need to listen to staff. So they are passionate and they are
willing to learn. So I found that spending time with these people was very invigorating and of course taught me a lot about things about technology, about market and so I just got pulled into this spending time with interesting people.
You've written this new book, which is much more personal. Tell us about why you wrote the book, and obviously that you've been struck by some of the worst things that happen to people.
Of course, as many people said, seem to have been unlucky compared with most people. So the book is called public Success, Private Grief. The public success we've just talked about the private grief is now not so private. So I lost my brother to cancel when he was twenty one. I lost Miss Alcoholism when she was fifty one. I lost my first wife, the mother and my children. She died of DBT when she was fifty one or fifty two. I suffer from alcoholism, though I've not had a drink
for nearly twenty four years. Sometime next month, I've got late stage cancer. That's what really triggered writing the book. I'll tell him about that at the moment. But the two things that were really are so painful even to talk about. What to talk about what I am doing, of course, is the loss of two children. So I had three boys who were two years apart, and my middle son died when he was twenty three, and my youngest son died who helped her with a book project,
died when he was thirty four, a couple of years ago. Anyway, it is exactly if you've got any children, anybody who's listens has got children, don't go there, don't think about it. And then so I was diagnosed with late stage stage four non smoking lung cancer. So one in five lung cancer us haven't smoked, and unfortunately we're the people who don't. Is not detected still quite late, so it was all over my body, my brain, well, lots of places in the body when he was detected. So that happened at
the end of twenty one. And then Alan died at the end of twenty two. And because I've written stuff before, and I'm sure I've helped a lot of people, lots of entrepreneurs, a lot of people in the charity sector over time, I just felt there was another book in me basically, but not a book in the sense of the other two, which are business books. A book that is personal, very personal and inspirational, because I don't know, I've come from Yorkshire. I've always been very direct, almost
too direct. I'm sure I've just decided to open it all. So I've written a book which is basically a memoir.
What do you hope the messages? Who do you hope is going to read the book? And also what do you think that people are going to learn from it? Because I mean, I think the title of the book sort of expresses it very very well, and I think that people listening maybe who are facing these sorts of struggles, whatever they may be, what are they going to be able to take in terms of inspiration or just kind of the will to go on.
It's just inspiration for getting on with life, not sweating the small stuff, as the Americans say, you know, you're asking, you know, doing the stuff that might not be might not be around tomorrow, to achieve.
Is it the to do list? I mean, it seems so terribly vc to say I'm going to make a business plan and I'm going to make the best of this awful situation. Is that just the bottom.
Line, that's one of it. And I have both what I call my bucket, this which we've all heard of, and I also have a list and you can probably.
Imagine might not be able to put that on radio.
Okay, I also have an effort list. Yes, so this of course is things that I don't know what to do any longer. There are things that I would have done before.
That you know, I go on, what are a few of those?
Well, even things like speaking at events, like mentoring people, like talking to entrepreneurs. There's a lot of things.
So I just think, no, you don't want to do it anymore?
Got why not? Well, it's because I haven't got that long left. Because unfortunately, because it's stage four, I do know that from the research that it's unlikely that I live past much past the end of this year. Now this is statistical, of course, but you know the statistical mean half is already before that date and half afterwards, and so something could happen even during twenty twenty four. So yeah, getting on with things. I mean, there's a number of lessons in the book. It isn't just that
there's a number of business lessons. Even in the book It's not a self help which we did think about doing. It's a memoir which has got a description in there so that people can read and hopefully work out from their own circumstances, which might have to do with something else and maybe just business failure. They can maybe even from that and the process of the business failing, learn how to cope with their own character and not disappear into a well of grief.
I also as a parent myself, it is the horrifying bit of losing children is so awful. How you how you dealt personally with that in the aftermath.
We couldn't have had this conversation within three months of his death. I just wouldn't have been able to talk about it without ending up in not being able to speak. In fact, obviously I grieve and miss both sons tremendously, But life I need to get on with my life, you know, I need to. It bubbles up. Sometimes it hasn't bubbled up during this interview, but it could easily have done and whether And part of it, of course, is not so much the busyness, but giving back, And
this book is about that. It's about trying to help other people. I haven't really answered your question. But it's that's because I don't really know. In the end, I'm just not sure how I've coped. You know, there isn't a magic wand to coping with tragedies. And I don't think it's because I'm a cold creature that just buries it or ignores it, or my skin shells so thick.
I think I really have sort of been lucky of had the right assistance at the right time, and I had something to redirect my grief and my addiction into, which has been positive benefit.
Yeah, a lot of our audience they're very young, and they're in the city, and they're in financial services, and it's all about making money, and I just I don't know. I think you've had experience in that world of trying to make it, you know that kind of really the drive of trying to build your own business, trying to do well. It's not exactly the same, I think as being in financial services in the city kind of being
in VC. But I suppose what would you say to those people about the point of it of the money making?
Yeah, money isn't the bill and nal and we all
know that. I mean, even that your listeners will know that in principle it would be really great if they do are in the city, staying there, they get to the point at say the age of thirty five, they back out and then they use that money and the time for something else, you know, going to teaching, help charities with time as well as money, etc. I've been obviously, I had customers in the city, so I've spent time with people in the city, and it is pretty frantic lifestyle.
This isn't a rehearsal. Life is not rehearsal. We all know that that's very hackney, isn't it. Enjoy life in some way get the balance right between personal life and work life. And I definitely got it wrong.
So that was Peter Cowley, the angel investor and co founder of UK based VC Martlet Capital, speaking to me at his home in Cambridge about his book Public Success, Private Grief, written with his wife. It is out now. That conversation has really stayed with me in the weeks since I met Peter and since we went up to Cambridge to have that conversation, I just thought it was so impactful and so powerful what he had to say.
I mean, it's my first time hearing it as our listeners would have been as well. And I think the thing that strikes me is that he speaks so lucidly about what he's taken away from everything that he's been through, and that he really has come out of it with a philosophy about what he can do, even though he's talking about having very lings of time left.
Yeah, and look, it took him about two minutes just to list, super rapid far all of the successes all of the businesses that he had invested in. He said at one point he had twenty seven different roles. So you know, he's just done so much in his business career, as you say, you know, he's done so much in the charitable sector as well, and so many sort of
important ideas. I mean, he also even talked about the UK government and politics, and I took away from that also he didn't want to give me a list of what Britain should be doing in terms of growing venture capital companies or economic growth. He actually said that what Britain needs to focus on is fairness, which again I
just thought was incredibly interesting. His views then on how to deal with adversity, balancing those work achievements, and frankly the luck that you need to have a little bit in life. Peter Cowley speaking to Bloomberg Radio.
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