Bloomberg's Sweeney, Wilson on Amazon's Blowout Earnings(Audio)

one percent. Jeff Morris is head of US Equities at Standard Life Investments. He was our guest minutes ago right here on taking stock. When you think about how we came out of the financial crisis, there was ample despair, you know, valuations were lower, and now the market is has moved up, has escalated for some time, and now seems to be just chopping sideways trying to digest this

environment of slow growth and relatively high valuation. So it's really a time, I think that, and someone has to be more focused on how they think about the market. And today the SMP five hundred index fell nineteen points down nine tenths of one percent down. Industriels down two hundred seven points, a drop of one two percent, and has stack down fifty seven, a drop there of one point two percent. Gold advancing nineteen ten the ounce to twelve sixty nine fifty a gain of one and a

half percent. Crewed up seven tenths of one percent forty five sixty five a barrel. Abbot Labs buying heart device makers St Jude Medical for twenty five billion dollars. Sasha the Moony covers healthcare for Bloomberg News. She was interviewed right here on taking stars. A good time for Abbott to come in for this acquisition St Jude. I've been

covering healthcare for thirteen fourteen years. St. Jude has been a perennial target every single year to the point where you think, you know what, this company is never going to be acquired, so they get acquired. The valuation if you if you look at where they're trading at right now, around seventy nine per share. The valuation is in line to what it was in jull I last year and St Jude up today by twenty five point six percent. Am Jin top first quarter profit estimates, also boosting its

two thousand sixteen forecast. SMP down nineteen, the drop of nine tenths of one percent four O two on Wall Street. Now we'll look at other news from around the world on Bloomberg Radio. Charlie, thank you from the Bloomberg News Room. I Mark Crumpton. The United Nations Security Council is condemning Wednesday's deadly air strike at a Syrian hospital run by doctors without Borders. More than twenty people were killed in

the latest attack on a hospital in the country. Opposition activists blame the government of Syrian President but shar Alissade for the renewed violence. Senator Ted Cruz, at a rally in Fort Wayne, Indiana, today, praised his new vice presidential pick, Carly Fiorina. Carley has spent her whole life shattering glass seilings and the naming of vice presidential nominee that may well be the most solemn, serious decision any president candidate has.

Donald Trump says the Republican presidential race is over if he wins in Indiana next week, but he's still railing against what he calls the crooked way the party picks its nominee. Speaking in Evansville, Indiana, today, Mr Trump claimed that Ted Cruz was unfairly winning delegates. How Speaker Paul Ryan is inviting Indian Prime Minister narnthram Mouthy to speak at a joint meeting of Congress this summer. This address presents a special opportunity for us to deepen our ties

with our with our ally India. It is a chance to hear from the Prime Minister on how we can work together to promote our shared values into increased prosperity. Duke Ellington's suits, piano and other belongings are heading for auction. Auction house Gernsney says about two hundred fifty items will be offered May eighteenth at the National Jazz Museum in Harlem. Ellington's iconic white baby grand piano could bring as much

as one million dollars. Global News twenty four hours a day, powered by our two hundred journalists in more in one fifty news bureaus around the world. From the Bloomberg News Room. I'm Mark Crumpton, Charlie, and we thank you and again recapping a move horor for stocks today SMP down nineteen, a drop of nine tenths of one percent. Seconds ago. We did hear from Amazon dot Com reporting earnings per share of a dollar seven estimates there fifty seven cents.

Net sales twenty nine point one billion dollars estimates twenty eight billion right now looking at Amazon shares six sixty seven in the extended session. They finished the regular session New York trading at six o two. So certainly a stock and a story we're watching after ours. I'm Charlie Palatine. That's a Bloomberg business flash. Move around, most great promotion. I the el move you move like they do. I've never seen anyone move that shot five people. Let's move

luck to get a purpose. That was called movers and shakers. They cost a little more. That name cracked me up. Bloomberg taking stock movers and shakers with Bim Fox and Kathleen As on Bloomberg Radio. Well, Charlie palotis reporting on those Amazon results. Wow. The first quarter earnings for Shore at a hundred excuse me, a dollar seven cents versus an estimated fifty seven cents reminds me of Facebook. Uh,

just blowing off the door with its EPs yesterday. On the second quarter net sales, Uh, they were a bit higher the net sales coming in. But it's a second quarter outlook where they're expecting twenty point eight to thirty billion dollars in change versus the twenty nine point billion one billion reported in the first quarter that we're going to be looking at shortly. I just want to break down the SP five hundred today. We've got nine gamers

for Herden, two losers, four un changed. Dave Wilson are stocks set, a r is here, and we've got of course Pim Fox and meet Kathleen Hayes. Paul Sweeney, who's the director of research at Bloomberg Intelligence follows Amazon very closely. Probably want you to jump in and give us your first blessed analysis of these results be able. The market certainly likes these numbers. The stocks up about nine or

ten percent uh here in the aftermarket. So just a real blowout in quarter in terms of revenue and EPs relative to consensus estimates. And I think even more more importantly, the company's guidance for for revenue for the second quarter

is better than expected as well. So you know what, Amazon investors have always been, uh, you know, accustomed to extremely strong top line growth, but now the company is actually starting to deliver some profits, which is something that Amazon investors really haven't had much of in the past. Let me just add a little bit having to do with Amazon Web Services, one of the most well one of the strongest growing businesses that Amazon has about ten

percent of their business. But Amazon Web Services reporting that they did two point five seven billion dollars in business. That's compared to two point five three billion that was estimated by analysts, so beating analysts estimates there. And also the company says that customers bought twice as many fire tablets as a year ago, So uh, customers buying more and people using the Amazon Web Services even more. Shares of Amazon are up twelve and a half percent UH

in after hours trading. Dave Wilson, Well, you know, you can't just look at the web services business, which really the growth engine of Amazon, uh, with without sort of looking at the year or two year comparisons. We're talking about sales up by a billion dollars, sixty percent, operating income more than tripling. I mean, do we really need to focus more on this side of the business, the whole cloud community business to understand what's going on at

Amazon these days? That's the question to you. Paul Sweeney. Yeah, I think that you know, one of the things about the cloud business for you know, all the tech tech companies.

It's obviously um extraordinary growth story within tech overall. But what's I think Amazon investors like about this business in addition to that huge six revenue growth, is the fact that it's actually profitable UM and you know, very strong profit margins there, which again is something profits that Amazon investors really haven't seen too much in the life of the company. So it's certainly you know, Amazon has certainly

got a leading position in that marketplace. But as our tech research has shown over the last couple of years, it's an incredibly competitive market plays lots of big players, lots of price competition UM. But AWS is clearly a leader there. And again it's a profitable business for Amazon, one of the best performing stocks last year. That's Amazon really doubling its market volume. TEA. What are we waiting

to hear on the call from Jeff Bezos? You know, I think it's uh, I think we're waiting to see a little bit about how they're thinking about the overall expense and investment UM in terms of operating expenses and capital expenses in the core business. Again, there's always a question there of are they going to rewatch it up uh expense growth and at the expense of near term profits. So I think people want to get a sense of what is their outlook for expense growth going forward, because

we know the top line is very strong. And then number two is again on the cloud business. You know, how sustainable is this type of growth in this type of profitability because investors are certainly getting used to seeing these kind of numbers out of the cloud business. Just to recap, Amazon dot Com reporting first quarter earnings per share of a dollar seven versus analyst estimates of fifty

seven cents. Company also reporting net sales of twenty nine point one billion dollars versus estimates of eight billion dollars that was provided by analysts. Once again, shares of Amazon right now are up about twelve percent and after hours trading. I want to thank you very much Paul Sweeney joining us from Bloomberg Intelligence. All right, now, it's time for the Volatility Index Report. It is brought to you by cbo E VIX Options and Futures. Volatility can be harnessed

with cbo E Vicks Options and Futures c disclosed. Learn more at cbo E dot com Slash Powerful Outcomes VIX. The VIX move higher today, up more than a ten percent, up one point three eight, settling at a fifteen point of fifteen. Now taking a look at the VIX, it's important to note that many people have been piling money into e t f s connected to the VIX, and that typically in the past has been a sign of a potential market downturn. All right, Dave, you're up. Uh Hi,

my name is Dave. Just what do you think you're doing? Things? We're going on will for moment four Dave. Carbo Ceramics, Dave, how come they've gotten left behind? Well, that's really the question you think about what's going on with energy stocks. The way the price of oil is rebounded in the least two and a half months, Carbo Suramics has been

certainly left out of the recovery. Now, this is a company that provides what's called a suram mcpropp and used by oil natural gas producers to prop open wells in shale fields after fracking. Carbo Ceramics listed under the ticker c R. Are they really tracked the two energy booms and bus that have taken place since two thousand nine, That said it came out with first quarter results today

that showed just how badly it's business has suffered. For the fifth grade quarter, carbon Ceramics postal loss and saw revenue fall more than fifty percent. Now chief exacutive Gary Coolestants in the statement the Carbon Ceramics may need to

tap news sources of financing. He had that company may try to generate revenue from its technology and plans more cuts in pay, but that altogether shares a carbon Ceramics fell as much as twenty one percent today, traded at a record low and closed with a loss of Dave Wilson, Thank you very much Bloomberg Stocks comments. Follow him on Twitter at the One Dave. Send him an email at d Wilson at Bloomberg dot net. Sign up for his free daily email newsletter. You're listening to taking Stock on

Bloomberg Radio Bloomberg. Taking Stock is brought to you by Fordham University to Cabelly School of Business Executive mb A top rink for the renowned professional network classes in Columbus Circle or Westchester. Learn Moore at Fordham dot E d U slash e m b A