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