|Day's range||68.35 - 68.35|
Microsoft is shedding its empathetic chatbot Xiaoice into an independent entity, the U.S. software behemoth said (in Chinese) Monday, confirming an earlier report by the Chinese news site Chuhaipost in June. The announcement came several months after Microsoft announced it would close down its voice assistant app Cortana in China among other countries late last year. Xiaoice has over the years enlisted some of the best minds in artificial intelligence and ventured beyond China into countries like Japan and Indonesia.
(Bloomberg Opinion) -- The stock market has been on a tear for the past three months, and Big Tech gets much of the credit.But how can this possibly be when the coronavirus has inflicted so much damage on the U.S. economy, with the highest unemployment since the Great Depression and gross domestic product headed into a black hole? And anyway, it's not as if tech is untethered from the economy.Yet, maybe tech isn't all that dependent on growth in the U.S. Compared to the rest of the world, and for the first time in ages, many wealthy industrialized countries are doing better -- and in some cases, much better -- than the U.S. Nations such as Japan, South Korea and Germany not only have managed to contain the pandemic, but their economies are well ahead of the U.S.'s into their re-openings. For the past five years, a small group of tech stocks has had an outsized influence on U.S. markets. Two-thirds of the gains in the S&P500 have been driven by just six U.S. companies -- Facebook, Amazon, Apple, Netflix, Google (Alphabet) -- the so-called FAANG stocks -- and Microsoft. An index of those six stocks is up more than 62% since the March lows, while the S&P 500 is up about 40%.Overseas markets may very well be a key reason shares of the biggest U.S. tech companies are powering higher. These tech companies derive a surprisingly large share of their revenue from foreign markets. According to Standard & Poor's, companies in the S&P 500 derived 42.9% of their sales from overseas markets in 2018 (2019 data is not yet available).But this share is much higher for the big tech companies: Apple generated more that 55% of its revenue outside the U.S. in the year ended in September; in some quarters, overseas accounted for as much as 60% of revenue. International accounted for 54.5% and 53.8% of Facebook and Alphabet revenues, respectively. For Microsoft and Netflix, the split is about half domestic and half overseas (49.0% and 49.4%, respectively). Amazon is the Big Tech exception, generating a sizable majority of its revenue within the U.S.What make overseas so important, though, is because that's where the growth is. Netflix had revenue growth of 21% in 2019, but the domestic side was a laggard at just 7%. Facebook, meanwhile, now has more users in India than in the U.S., with Indonesia and Brazil growing fast. For Alphabet, Asia and Latin America have produced faster revenue growth than the U.S.It isn't a coincidence that these companies that are so reliant on the rest of the globe have seen their stock prices do well. The Covid-19 numbers suggest that much of the world is way ahead of the U.S. not only in terms of managing the pandemics, and that their economies are recovering faster.As of July 9, globally, there were more than 12 million confirmed cases of Covid-19 and almost 550,000 deaths. In the U.S. those figures were 3 million confirmed cases and 132,000 deaths. This data is a report card on how well the country is managing the pandemic: The U.S. has 4.2% of the world’s population, but 25% of the infections and 24% of the deaths.And yet, even this national incompetence has worked to the advantage of the Big Tech companies. All they require of their customers is a computing device and a network connection; users are not limited by geography -- either domestically or internationally. Nor do users need to have a physical presence at an office.Some companies are well positioned to survive the pandemic lockdown, thriving during an era of remote work and social distancing. Many of these same companies are well positioned to benefit from the rest of the world’s economic recovery. As it turns out, tech companies can profit both from the U.S.'s shutdown and a recovering Europe and Asia. It is a very effective one-two punch. It explains so much of the market’s gains.This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Barry Ritholtz is a Bloomberg Opinion columnist. He is chairman and chief investment officer of Ritholtz Wealth Management, and was previously chief market strategist at Maxim Group. He is the author of “Bailout Nation.”For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Nokia (NYSE: NOK) was once one of the world's top mobile phone makers, but it sold its handset unit to Microsoft (NASDAQ: MSFT) in 2014. The Finnish company subsequently focused on growing its Nokia Networks business, which sells telecom equipment to carriers. Nokia bought its rival Alcatel-Lucent in 2016 to expand that business and become the world's second-largest telecom equipment company.
Investing in these diverse technology companies will allow you to benefit from hot trends while getting paid along the way.
FedEx (NYSE: FDX), Lululemon (NASDAQ: LULU), and Intel (NASDAQ: INTC) are all quietly making moves that set them up nicely for the future. Interestingly, FedEx and Lululemon have been able to adapt to COVID-19 realities and increase business, while Intel works behind the scenes to deliver advanced technology today. In 2019, FedEx cut ties with Amazon (NASDAQ: AMZN), causing many on Wall Street to shake their heads.
(Bloomberg) -- Microsoft Corp.’s LinkedIn programmed its iPhone and iPad applications to divert sensitive information without users’ knowledge, according to a class-action lawsuit.The apps use Apple’s Universal Clipboard to read and siphon the data, and can draw information from other Apple devices, according to the complaint filed Friday in San Francisco federal court. The privacy violations were exposed by Apple and independent program developers, according to the suit.Developers and testers of Apple’s most recent mobile operating system, iOS 14, found LinkedIn’s application was secretly reading users’ clipboards “a lot,” according to the complaint. “Constantly, even.” Apple’s clipboard often contains sensitive information users cut or copy to paste, including photos, texts, emails or medical records.“LinkedIn has not only been spying on its users, it has been spying on their nearby computers and other devices, and it has been circumventing” Apple’s clipboard timeout, which removes the information after 120 seconds, according to the suit.LinkedIn spokesman Greg Snapper said the company is reviewing the lawsuit. Erran Berger, head of engineering at LinkedIn, said in a July 2 tweet that the company had traced the problem to a code path that performs an “equality check” between contents on the clipboard and typed text. “We don’t store or transmit the clipboard contents,” he added.The lawsuit was filed on behalf of Adam Bauer of New York City, who says he routinely used the LinkedIn App on his iPhone and iPad.The suit seeks to represent a class of users based on alleged violations of federal and California privacy laws and a breach of contract claim.LinkedIn’s information collecting was reported earlier this month by outlets including the Verge and Forbes.The case is Bauer v. LinkedIn Corp., 20-cv-04599, U.S. District Court, Northern District of California (San Francisco).(Updates with LinkedIn spokesman in fifth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Strong growth in several massive markets will help drive NVIDIA's (NASDAQ: NVDA) share price to $500. So says Rosenblatt Securities analyst Hans Mosesmann. On Friday, Mosesmann reiterated his buy rating on NVIDIA's stock and boosted his target price from $400 to $500.
The Zacks Analyst Blog Highlights: Apple, Microsoft, TMobile US, Goldman Sachs and Cigna
Warren Buffett makes it look so easy: find high-quality companies, wait for a fair price to buy, and then hold them... forever. The problem of course is that t...
The Microsoft (NSQ:MSFT) share price has risen by 13.0% over the past month and it’s currently trading at 214.32. For investors considering whether to buy, hol...
Investors expect the company's technology platform to come in handy as the world corrals the coronavirus pandemic.
(Bloomberg) -- Some of Wall Street’s biggest stocks are coming off their best quarterly performance in years, and with the broader economy still grappling with the pandemic, analysts are starting to express some skepticism about high-profile rallies.The S&P 500 surged 20% in the second quarter, its biggest quarterly gain since 1998. While the superlative nature of the rally was partly a function of timing -- many components hit a bottom right before the end of the first quarter -- the move was fueled by tech and internet stocks, which outperformed the benchmark and have heavy weightings due to their massive market capitalizations.Apple and Amazon.com both gained more than 40% during the quarter, making it the iPhone maker’s best quarter since 2012 and Amazon’s best since 2010.On Wednesday, Deutsche Bank confessed it was “surprised at both the speed and magnitude of the rebound” in Apple shares, adding that the move “has us nervous.” Raymond James echoed this tone on Tuesday, seeing uncertainty surrounding Apple’s forecast given an expected delay in the iPhone 12, a product Nomura Instinet expects “will fall short of a supercycle.” Both Deutsche Bank and Raymond James still recommend buying Apple shares.Amazon remains a consensus favorite on Wall Street -- more than 90% of the firms tracked by Bloomberg recommend buying it -- but the degree to which the share price exceeds analysts’ average price target is near a multiyear high, suggesting that even bulls aren’t expecting much additional upside.Among other mega-cap names, Microsoft rose 29% over the second quarter, its best such showing since 2009. Both Facebook and Google-parent Alphabet notched their biggest quarterly gain since 2013, with Facebook up 36% and Alphabet up 22%, based on its Class A shares. Netflix rose 21% last quarter.All are at or near record levels, and the rallies will soon be tested as each member of the group is scheduled to post quarterly results before the end of the month, with Netflix reporting next week.Apple EstimatesFor Apple, the rally has come despite a more tepid view for its upcoming results. Wall Street expects third-quarter earnings, excluding some items, of $2.03 a share, a consensus that is down 6.8% from where it was three months ago. The consensus for revenue has declined 0.9% over the same period.While analysts debate whether the results will justify the recent gains, many of these names are seen as potential pandemic winners. Microsoft is expected to see stronger demand for its cloud-computing and workplace collaboration products as people continue to work remotely, while the e-commerce wave lifting Amazon and others is seen as outlasting the coronavirus’s impact on brick-and-mortar stores.Apple analysts also see a number of reasons to be optimistic for the long term, including the company’s services business, wearable products, and its stock-buyback program. “Overall, we believe the directionality and reasoning behind AAPL’s stock rise,” Deutsche Bank’s Jeriel Ong wrote. Still, the firm has “ambivalence at these levels.”Firms expressed a similar sentiment about Netflix, which has seen higher engagement during the pandemic. Rosenblatt Securities “struggle[s] to see the upside” from current levels given “uncertainty over how [long] this favorable environment will last.” Stifel continues “to grapple with the risk/reward profile given limited 2H visibility.”Imperial Capital downgraded the stock earlier this week, moving away from an outperform rating that it had held since starting coverage on Netflix about two years ago, according to data compiled by Bloomberg. Following the recent advance, Netflix “will begin a fairly extensive range-bound trend as other long opportunities emerge in the media space,” the firm said.(Removes reference to Microsoft reporting next week in seventh paragraph of story originally published July 8.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Walgreens is raising its cost savings target as the pandemic hits sales and profits, and analysts see Microsoft and Cisco as good bets.
Top Research Reports for Apple, Microsoft & TMobile
By Yasin Ebrahim
Three of the biggest players in the virtual meeting space, Zoom Video Communications (NASDAQ: ZM), Slack Technologies (NYSE: WORK), and Microsoft (NASDAQ: MSFT) Teams, all had big product announcements this week. The timing of these updates indicates the intensity of the competition between these leading virtual meeting providers. The offering will make accessing Zoom Rooms and Zoom Phone easier by providing subscription options for phone and meeting room hardware to complement its Zoom videoconferencing services.
Here we discuss four companies stirring up competition in enterprise communication space, with recent efforts to enhance their video conferencing platforms amid work-from-home push.
Cloud computing has been a promising investment theme in recent years. As NVIDIA (NASDAQ: NVDA) CEO Jensen Huang said on a recent conference call, "The basic computing elements are now storage servers, CPU servers, and GPU servers and are composed and orchestrated by hyperscale applications that are serving millions of users simultaneously." Research firm Gartner previously forecast that the total cloud computing market will grow 17% this year to reach $266 billion, and that was before a global pandemic accelerated the trend.
(Bloomberg) -- Warren Buffett’s $2.9 billion gift this week means he has now given away Berkshire Hathaway Inc. shares valued at more than $37 billion since 2006.His philanthropy -- along with Berkshire’s underwhelming stock performance recently -- is finally starting to weigh on his net worth after years where his fortune defied his annual giveaways to rise ever higher. Buffett’s $68.6 billion is enough for eighth-place on the Bloomberg Billionaires Index, his lowest position since the index started in 2012. He ranked in the top 5 as recently as June.But in recent weeks the 89-year-old has been leapfrogged first by Steve Ballmer, the former Microsoft Corp. chief executive officer, and this week by Google co-founders Larry Page and Sergey Brin. The changes underline the extent to which technology fortunes now dominate the upper echelons of the world’s richest people.Six of the seven richest people on the planet owe their wealth to the sector, including No. 1 Jeff Bezos, who has added $68 billion to his net worth this year, and Ballmer, who’s gained $18 billion. Tech fortunes are the best performing on the index, up 25% in 2020.Ballmer’s fortune has soared thanks to the 4% stake he’s estimated to have retained since leaving Microsoft’s board in 2014. The software company’s shares have risen almost fivefold since then, boosting his fortune to $76.5 billion. Ballmer declined to comment on his Microsoft stake. Berkshire didn’t respond to a request for comment.Buffett may welcome signs his gifts are shrinking his fortune. His pledge to give away his fortune only got harder as his fortune continued to rise. In his latest letter to shareholders he said he expects it will now take 12 to 15 years for his estate to dispose of all the shares he holds at the time of his death.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Google abandoned plans to offer a major new cloud service in China and other politically sensitive countries due in part to concerns over geopolitical tensions and the pandemic, according to two employees familiar with the matter, revealing the challenges for U.S. tech giants to secure business in those markets.In May, the search giant shut down the initiative, known as “Isolated Region” and which sought to address nations’ desires to control data within their borders, the employees said. The action was considered a “massive strategy shift,” according to one of the employees, who said Isolated Region had involved hundreds of workers scattered around the world.Alphabet Inc.’s Google is pouring money into cloud computing, part of a broader effort to find new sources of growth beyond search advertising. Google Cloud generated $8.9 billion in revenue in 2019 -- a 53% increase over the previous year -- as it has pushed into sectors such as finance and government that require special security clearance and features that shield confidential data. Rivals Microsoft Corp. and Amazon.com Inc. already offer these capabilities via their cloud units.Google’s recent decision to nix the Isolated Region project was made partly because of global political divisions, which were exacerbated by the Covid-19 pandemic, according to the two employees, who requested anonymity because the project hasn’t previously been made public. The geopolitical issues placed demands on Isolated Region that it couldn’t deliver, according to one of the employees. Documents provided to workers also detailed global tensions and their influence on Isolated Region’s closure, the employee said.The initiative would have allowed Google to set up cloud services controlled by a third party, such as a locally owned company or a government agency. The result would be a business sequestered from Google’s existing cloud computing services, which include data centers and computer networks.In January 2019, amid growing tensions between the U.S. and China, Google decided to pause its plans for Isolated Region in China and instead began to prioritize potential customers in Europe, the Middle East and Africa, according to the two employees. But the project was scrapped entirely this May, the two employees said. Google has since weighed a pared back cloud offering to enter China, according to the two employees.‘Other Approaches’A Google spokeswoman, speaking after the story was published, said Isolated Region wasn’t shut down over geopolitical concerns or the pandemic. She also said the company isn’t weighing options to offer the Google Cloud Platform in China.Isolated Region was shelved because “other approaches we were actively pursuing offered better outcomes,” she said, declining to detail those approaches. “We have a comprehensive approach to addressing these requirements that covers the governance of data, operational practices and survivability of software,” the spokeswoman said. “Isolated Region was just one of the paths we explored to address these requirements.”“What we learned from customer conversations and input from government stakeholders in Europe and elsewhere is that other approaches we were actively pursuing offered better outcomes,” the spokeswoman said. “Google does not offer and has not offered cloud platform services inside China.”According to one of the employees, the plan involved selling cloud services in what Google calls “sovereignty sensitive markets,” such as China and the E.U., where there are strict laws for companies offering services that involve the collection or processing of people’s data.The project, which began in early 2018, sought to address rules in China that require Western companies to form a joint venture with a Chinese partner company when they provide data or networking services, one of the employees said. In such a relationship, the partner company would have retained both physical and administrative control over user data. The arrangement was intended to satisfy Chinese authorities while also providing a barrier between Google’s Isolated Region cloud services and the rest of its data center network, which stores and processes emails, documents, photographs and other data from its users, the employee said.By handing over control of user data to third party companies in foreign countries, Isolated Region also aimed to appease privacy concerns about the U.S. government’s potential ability to carry out covert surveillance of Google’s Cloud services, the employee said. Those concerns increased in March 2018, following the passing of the Clarifying Lawful Overseas Use of Data Act, better known as the CLOUD Act, a federal law that granted U.S. law enforcement agencies more power to request personal data stored by American technology companies even if the data is stored on servers located outside of the U.S., the employee said.Data SovereigntySome employees expressed concern about the Cloud project in China and questioned their superiors about it, according to one of the employees. But it’s not known if employee opposition was a factor in Google’s decision to stop the initiative in China or elsewhere.Isolated Region was part of a larger Google project known as “Sharded Google,” which has sought to develop new data storage and processing facilities, known as “shards,” that are walled off from the rest of the company’s systems, according to the employees.Major cloud providers are all racing to develop data centers that are either physically separated or rely on complex software to keep information flows apart.It’s a costly process, driven by rising demand on two fronts. One is from firms in specific industries, such as finance, that want isolated machinery for security reasons. Another comes from laws that require data reaped inside the country to stay there, with China being perhaps the most stringent example.Both trends are accelerating. More than 100 countries have some sort of data sovereignty laws in place, according to David Gilmore, chief executive officer of DataFleets Ltd., an enterprise software firm. In the U.S., state policies, such as California’s new consumer privacy law, provide further restrictions on how cloud companies handle data. “It’s just the tip of the iceberg,” he said.France and Germany recently started Gaia-X, an effort to build the continent’s own data storage systems over the internet without relying on U.S. technology giants.Cloud RegionsProtectionism is a major force in these calls for data localization, said Trey Herr, director for the cyber statecraft initiative at the Atlantic Council. “Part of it is security,” he said. “A lot of it is economic.”Google’s competitors in this space, such as Amazon Web Services and Microsoft Azure, have dominated the market in recent years. Cloud regions let companies offer the horsepower and security of multiple data centers. Microsoft has more than 60 cloud regions globally, more than double AWS and Google. The Google spokeswoman said the company defines regions differently.In 2018, Google considered building an isolated version of its systems to support a classified U.S. government computer network. The system, known as “air gap,” would have been disconnected from the internet and from Google’s existing servers, and was designed to be used only on high-security government networks that store secret information.But the air gap project was shelved after internal opposition. Some employees said they feared the system would lead to work with the U.S. military, which they opposed for ethical reasons. Other employees opposed it on technical grounds and thought it would be too hard to deliver.In China, Google has long been eyeing ways to access the country’s lucrative marketplace, where there are approximately 900 million internet users. While Amazon and Microsoft sell their cloud services in mainland China, Google hasn’t. But about three years ago, the company began talks with Chinese firms about providing its main data storage service in the nation through a joint venture, as Amazon and Microsoft do. Google also provided some of its free machine learning tools in China, and the company started working on projects to provide more software tools to developers there.Most of those efforts, however, were shut down by Google Cloud Chief Executive Officer Thomas Kurian, shortly after he took over the division in January 2019, according to one person involved in the plans. At that time, political and economic tensions between the U.S. and China were rising. In addition, Google’s actions in the country had come under increased scrutiny, following leaks about a plan for a censored Chinese version of its search engine.Isolation Region was conceived as another potential product for Google to offer in China, according to one of the Google employees. But key political impediments contributed to the decline of the project in China and elsewhere, including the U.S. national security orders against China telecommunications giant Huawei Technologies Co. and the fallout from the pandemic, according to the employee; Google disputes that the pandemic or geopolitical issues were factors.Kurian didn’t scrap all of Google Cloud’s China-related work. According to one of the Google employees, and another person familiar with Google’s cloud operations, the company has continued to explore the possibility of rolling out a service called Anthos in the country. Launched in 2019, Anthos lets companies using one cloud provider easily add on another. Businesses across the globe have adapted this strategy as a way to hedge financial and infrastructure risk. The Google spokeswoman said the company has no plans to provide Anthos in China.In a September 2019 interview with CNBC, Kurian said that Google’s cloud business was seeing “enormous growth” and hadn’t been affected by the U.S. trade war with China. He pointed to the company’s large presence in Hong Kong and Taiwan and didn’t rule out expanding into China’s cloud market. “We continue to monitor the demand for our technology from Chinese customers,” he said.(Updates with additional comments from Google starting in the sixth paragraph.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Yahoo Finance catches up quickly with Slack co-founder Stewart Butterfield in the wake of the company announcing its sixth-ever acquisition.
While we've had quite a bit of anecdotal evidence for this, Microsoft today released some of the research it did in this area, as well as new features in Teams that it hopes will make video meetings easier and less tiring. The first of these is Together mode. To be able to change backgrounds or add background blur, Teams already features Microsoft's AI segmentation technology to detect and cut out a participant's image from the background.