pressure from the white house to vote on their stalled health care bill this week. house speaker paul ryan said today there has been real progress in winning over skeptics. former national security advisor michael flynn's speeches are being probed by a pentagon watchdog. the defense department is investigating whether he obtained approval for remarks made to a pressure-backed media network. told he waswas prohibited from accepting payments from a foreign government without approval. two u.s. service members were killed and another wounded during a ground assault against islamic state fighters in afghanistan. u.s. forces were accompanying afghan troops on the raid when they came under attack. dao, the united airlines passenger drag from a plane earlier this month, has settled with the airline. they did not disclose the amount. united is also revamping company policies. offer as muchll

as $10,000 to customers who voluntarily give up their seats on overbooked flights. global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i'm alisa parenti. this is bloomberg. "bloomberg technology" is next. caroline: i'm caroline hyde. this is "bloomberg technology." coming up, big tech declares the first quarter. we will crunch the numbers. alphabet survives its ad platform backlash and unleashes a banner first quarter. we will highlight the numbers across the board. microsoft concerns bubble to the surface. shares drop from record highs after the third-quarter report.

we explain why. popping inon shares extended trading. i want to bring you up where we are currently performing, up about 4% in trading after record highs hit on thursday. 3.6%, the e-commerce giant reported a 23% increase in sales and a profit of $724 million in its quarterly report. the cloud services arm reported 43% increase in sales. founder and ceo jeff bezos highlighted the company's success as it pushes into international expansion, particularly into india. is jitendra waral. let's take it to you first. give us a quick snapshot. we got a significant beat in earnings per share. revenue pretty much in line, but still growing at quite a quick. -- clip.

jitendra: they are executing well on all cylinders. that's what they are showing. the whole investment cycle that amazon embarq's on -- embarks on, we can deliver the topline growth, so it's ok if we increase spending to bolster our growth story. aws,a profit perspective, biggest venture bitter, the north american margins are steady, but the international losses continue. they have a lot of chances to expand internationally. this growth runway continues. more importantly, they are showing they can execute against these numbers. caroline: i want to dive into my bloomberg again, because it's quite phenomenal. there records for amazon, we have not one single cell on this onck across -- single sell this stock across recommendations. the stock trades higher in after

hours. let's get james mcquivey's point of view. was it aws that stood out for you as well as prime? what about some of the margins? awss: we are happy to see perform so well. there was some softening in the last quarter, so it was good to see the numbers come back up. we need to see that it can fire on all these cylinders, and it is. but the u.s. business in particular, the margins are to be will continue small, but we are really confident that it will continue to grow, even a small margin, year after year after year. there is still so much headroom in the u.s. retail business for amazon to claim. between a high-growth product domesticand a solid retail business that is growing, that's what's going to fuel the international expansion they are working on. caroline: both of you have talked about international expansion. i think it's really interesting the earnings press release led with india. this is such a clear sign of

intent coming from amazon. jitendra: absolutely. if you look at their strategies, they're pricing strategy is also different. it's basically telling you that they are expanding by localizing their strategy, which is really working for them. caroline: mexico also, a new -- caroline: mexico, also a new area they are launching prime. what about content? with amazon prime comes the amazon fire stick and fire tv. they are spending big as ever. they reap the revenue, but do not always deliver profitability. james: a real way to think about the video focus, any other content focus of amazon, is how do we increase the number of engagements per day and minutes of engagement per day. you can think of amazon at go and alexa -- amazon echo and alexa as an extension of that. it can include asking alexa, what's the weather.

all of that eventually accrues to i'm going to shift a larger percentage of my retail spend to amazon. even though that's not generating topline dollars for them, it is cementing what is undoubtedly the industry's most powerful customer relationship. caroline: where next in terms of can amazon profitably go? record highs across the board for many of these stocks. i'm looking at amazon with $439 million architect. it's -- $439 million market cap. are you expecting continued positivity? jitendra: now that these touch points that amazon keeps adding, with the video, the ai assistants, different products and services, it brings people back to prime. once people are back to prime, they spend more. this like a has a long runway. if you look at the markets, a lot of verticals, they are distorting to enter. the international -- they are just starting to enter. of course, the cloud business,

which continues to beat expectations in terms of how big is this market. that number keeps on going up. i think they have markets big enough to support that growth longer-term. --s just the bouncing balancing act of how much should we invest and continuing to show these positive roi numbers through revenue growth. caroline: james, i asked this to our guest when we discuss alphabet. how worried should alphabet be by the growing advertising start of the business that amazon is starting to show off? are these key competitors fighting it out in cloud as well? james: these are two of the most unlikely competitors that, for years, people tried to separate mentally. they are in the business of attention. amazon is in up attention -- position to give you a much more contextual ad placement in google -- than google is.

when you add what amazon can do when it starts observing you in your life with cameras that it, as of this week, has added to some of its alexa/echo line, it's going to be in a position to know so much about you and make product recommendations that surpass the value of advertising, coming at a time when major brands are pulling back billions of ad dollars which they aren't sure ours and -- are spent well. if i'm google or alphabet, i'm very nervous. caroline: fascinating points of view from both of you. james mcquivey and jitendra waral. fascinating insights into stocks they just keep on giving. giants reporting earnings. microsoft reporting a 60% jump in earnings from the same period a year ago come a continuing to see growth in its cloud software ago,ess 0-- a year

continuing to see growth in its cloud software business. at intel, results fell in line with estimates and it raised its full-year view, but numbers fell short in its data center business. more coverage in reaction to those results later in the show. do stay tuned. coming up, we continue to break down all the tech earnings. up next, alphabet surging after beating on its results. this is bloomberg. ♪

caroline: let's continue on the tech earnings bonanza. alphabet -- paid clicks up 44%, beating industry expectations. revenue from its other bets unit

showed improvement, generating $244 million in the period. investors are pleased, shares surging post-market. currently seeking it up 4.2%. up 4.2%.ly seeing it amazon and alphabet both ticking higher, near or at record highs already. alphabet worth $610 billion. let's get more reaction. anding us from new york from washington, harry kargman and mike bailey. let's get the investor take first. mike, how are you looking at these numbers? no major concerns. i think it's a pretty clean beat. we were a bit surprised. the stock is not up more. the earnings beat by about 4%. the stock is up 4%. investors are treating this as

the same company it was before the earnings came out. in our minds, this is a higher quality company. investors are not showing that in terms of rising sentiment. we are still as confident in alphabet as we were before the earnings came out. want to getrry, i your point of view here. i have been speaking to an executive at alphabet and asking, what about the youtube controversy, what about the andlash of advertisers perhaps the slowing down of wanting to link yourself with certain videos, and they said this is only going to be a modest effect in the medium-term. in the longer term, we might actually see some improvement if they change the business. are there worries surrounding this? tory: in q1, it's not going affect the business. the ad boycott only started in the last month or so. it started in the u k and is spreading to the u.s. most of its revenue is generated from the small- to mid-

advertisers. run.be is a scary place to it was not built for those large-scale brand advertisers. youtube was hot proverbially -- caught proverbially with its pants down where there is now a lot of press around great advertising and great advertisers running against hate speech and other problematic content. for what we are seeing is that google is now having to approach seeing but what we are is that google is now having to approach this problem and deal with it. there are cheeks in the armor -- chinks in the armor. caroline: chinks in the armor. you are not worried about youtube at all? mike: we are not too concerned. i was watching you earlier. the commentary that google only expects a modest impact here. i think that's very telling. this is a major blow to potential sentiment, a blow to the pr for google. here they are, and it's only

going to have a modest impact. i think in our minds they have done a pretty good job of identifying the problems, working to correct it. our sense is that google is seeing everything from the inside, and they are not seeing a major impact yet. i would typically go with some of that commentary in terms of the forward impact. moving awayrry, from youtube and looking at other areas, we are all very concerned about the money being plowed into so-called moonshots. thatu feel more at ease, perhaps they have a handle on their spending? harry: i don't think it has made a major contribution to the revenue. the core business is still advertising across search and video. i think that they are going to be careful about spending their money in the right places. i think the key thing for them is they have to find that next growth area. who knows whether these types of problems associated with content

are going to have long-term effects on their video business? i think search is pretty safe, but their video business, i think over the long-term, if it is not seen as a safe place for brands to run, i think it will have a material impact. you may not see it the next quarter or even the quarter after, but i think you will see, over the next few years, there is not that plowing of 80% of budgets into youtube digitally. they will diversify their revenue -- these moonshots are to diversify their revenue. caroline: amazon becoming a threat on multiple fronts. i want to get the investor take here, mike, on whether you think amazon is a key threat now in terms of advertising, in terms of cloud. mike: absolutely. i did hear your earlier guest. it sounds like he's a little more concerned that amazon may be getting into google's territory in terms of advertising. we are a little less concerned. if we pull back and look at this quarter's for earnings and look

at all the different sort of dynamics here, we are seeing rising barriers to entry. we are seeing that across basically all the bank socks -- stocks. our sense, in particular for the advertising space, specifically for google and for facebook, we are seeing very high barriers to entry that continue. in our minds, as we pivot over to amazon and asked the question, are they going to get into google's ad business, we think that google has a pretty big head start. we think it may be somewhat difficult for amazon to make some gains their. -- there. amazon has plenty of other growth drivers. at this point, we are really not too concerned about the competition there. caroline: frenemies for now. the shares continue to trade higher for both alphabet and amazon. harry kargman and mike bailey, thank you.

coming up, our exclusive interview with paypal's cfo john rainey. we will dig into their growth in the overcrowded payments industry. this is bloomberg. ♪

caroline: paypal shares popped over 6% in trading on thursday. investors are embracing the company's strategy of converting the online payments platform into a digital wallet. the ceo's strategy is working as the company raised its annual forecast. i spoke with the cfo, john rainey, earlier. john: partnerships has been a big part of our strategy when we made a pivot about a year ago, starting with some announcements with lisa. -- visa. those have been followed on with announcements from facebook, alibaba, and google. the space around payments and

the combination of online and off-line continuing to merge -- it increases the addressable market. it's one where we believe the right strategy is to partner with others and build on their strengths that complement the strengths of paypal. caroline: a lot of what you are now focusing on is payments. what about the credit side of the business? we talk about spinning out that area of offering loans and credit to people and businesses. is that something -- you talk of an asset-like future. is that something you can explain for us? john: sure, that's a great question, caroline. have a credit product that -- we have a credit product that complements our product for the consumer. we want to continue to be the credit business. we can do it in a less capital-intensive manner. we have over $5 billion of consumer credit receivables on our balance sheet. we are exploring partnerships with other issuers or even a

strict pure-asset sale so that we can free up that cash and use it for capital allocation to what is perhaps higher returning investments. caroline: what sort of higher-return investments are you analyzing? john: most important leak, investing in ourselves. we are a growth company that is growing revenue -- most importantly, investing in ourselves. we are a growth company that is growing revenue. there are a lot of acquisitions that help fill in holes that we have worked white space where we are globally -- we have or white space where we are globally. we have the balance to distribute cash to shareholders. we just announced this quarter that we increased our share buyback authorization to $5 billion following the $2 billion one we announced last year. caroline: you talk about the white space that potentially could be analyzed for acquisitions. what gaps do you want to be

filling in? certainly, if you look across the world, whether it's asia or getting down to africa, parts of europe, there are markets that we are not penetrated into the extent that we would like. we talk about democratizing money. if you think about emerging economies broadly, there are 2 billion people in emerging economies that don't have access to break -- basic things you and i take for granted, like a checking account, savings account, having a mortgage on their home. the benefit of fint4ech -- f intech is put all the power of a bank branch in the palm of their hand. there is a huge addressable market for us and many others to play in. caroline: fascinating. maybe our reach into the emerging markets. i'm interested in some of the products currently available in the united states, perhaps moving to the u.k. talk to us about the no -- about venmo. how do you think this might be monetized? is it all about user engagement? john: it's about user engagement

and customer acquisition. it's one of the largest vehicles we have for acquiring customers today. it truly is a viral app. what's unique about it is that it combines not only peer- to-peer payments, but a user experience as well. users share the experience with their friends. that's of huge value to merchants. in what high fidelity one individual does in terms of their purchasing patterns and its influence on other individuals. we are just now launching pay with venmo, which is enabling us to explain from just a peer-to-peer -- expand from just a peer-to-peer platform to where our customers can pay with venmo at stores. certainly merchants are looking forward to that as well. caroline: there is talk of competition in this area. apple is said to be analyzing a venmo rival. would that be a concern?

john: competition is nothing new to us. there is a huge addressable market. certainly, there's a lot of excitement in fintech in general. that's why you see the level of competition that we realize today. in the face of that competition, we have been able to grow our revenue upwards of 20%, continue to expand our operating margins, and generate free crack -- cash 25%. margins 20% to it is what gets us up in the morning and excited about facing the day. caroline: sometimes competitors can become frenemies. we've seen you strike an interesting deal, thought of as wise with the analyst group, in terms of integrating into android pay. what about integrating into apple pay? orn: whether it's apple pay any other technology platform, one of the great aspects about paypal is that it's truly technology agnostic.

it can be used across any platform, any mobile device across the world. our aspiration is to partner with all those major technology players to allow our customers, most importantly, to use paypal whenever and wherever they want. caroline: that was paypal's cfo john rainey. coming up, microsoft's earnings showing a slow in momentum. we will dig into the numbers. you like bloomberg news, check us out on the radio. you can listen on the bloomberg radio app, bloomberg.com, and in the u.s. on sirius xm. this is bloomberg. ♪ ways wins.

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with mexico -- kelly says there are spots along the border where a wall cannot be built because of the terrain. germany's angela merkel says britain should not be under the impression it will retain the same eu rights and privileges when it leaves the bloc. she says europe envisions britain as a close partner, but it's still an outsider. then british prime minister theresa may said comments like merkel's are the reasons why she needs the strongest possible hand to go into battle with european union negotiators. presidential candidate emmanuel macron visited a working-class immigrant suburb of paris. today the centrist faces -- of paris today. presidency a le pen offers a fractured france. police in paris sprayed tear gas during a student march against le pen. armed police detained a man they

say was carrying knives in a bag near britain's parliament. they arrested him on suspicion of planning terrorist attacks. officials say he was detained as part of an ongoing counterterrorism operation. global news, 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i'm alisa parenti. this is bloomberg. it's just after 5:30 p.m. thursday in new york, already 7:30 friday morning in sydney. i'm joined by bloomberg's paul allen with a look at the markets. good morning. paul: good morning. we are seeing asx futures weaker by just four points to end the week. nikkei futures showing a mixed picture. keep an i on nomura -- an eye on nomura. they announced a return to profit. nomura also announcing it will sell its 1.6% stake in standard chartered. that will be worth about $500 million. another stock to watch in hong kong, china construction bank.

upst quarter profit there $3.2 billion. a lot of data out of japan today. japan kept its policy unchanged on thursday and lowered its inflation forecast. agriculture bank, bank of china, and bank of communications -- all reporting earnings on this friday. more from "bloomberg technology" next. caroline: this is "bloomberg technology." i'm caroline hyde. we returned to our top tech story of the hour, earnings.

we've gone through amazon and alphabet. now onto intel. it seems it's best business is not living up to company expectations. sales below the company's long-term goal of double-digit percentage growth. intel is trying to spread its bets away from the personal computer market that has been declining since its peak in 2011. shares of intel down almost 4% as we speak, on the bloomberg. watch out for that stock as we open tomorrow. now to another pc-exposed business, microsoft also reporting revenue. the company missed estimates on its personal computing side of the business. anorak run a covers microsoft -- rana red rubber -- anurag covers microsoft for bloomberg. the pc numbers were ok, but it was the surface tablets that came out below. one of the comments we read on the tape was that there were

some older models that were likely the reason for this downfall. we see this in hardware cycles when you have newer models come in. the growth will come back. for us, the biggest issue is to talk about the enterprise and the cloud business, where the numbers were very strong. about thetalk to us real growth area. this is the number two player in the market. what sort of growth are we seeing? about 94%.y grew if you compare that with amazon, they grew about 43% this quarter. thann is much larger microsoft in this business, but they are a strong contender as number two. their legacy product business actually grew as well. one of the things we've been talking about is, as legacy enterprises move their infrastructure to the cloud, they would need a company that is very strong both on premise as well as the cloud. if you look across all different technology companies offering cloud services, microsoft really foots the bill into that

prescription. caroline: i'm looking on my bloomberg and digging into the segmentation of microsoft. 44% was more personal computing. cloud,h -- 27% is intelligent cloud, they call it. how much of the business of microsoft could the intelligent cloud become? anurag: it's a very small portion of global spending right now. if you look at public cloud spending, according to any estimates, it is somewhere around $100 billion, 4200 bil -- $200 billion. this is still early innings. there is a lot of growth for everybody in this business going forward. caroline: looking at the shares, down at the moment after hours, about one percentage point, is this largely in part because they've been at record highs? anurag: expectations for not just microsoft, but a lot of

tech companies have been very high going into the quarter. they have been close to all-time high for the last several days. all of that included with this miss that we talked about on surface tablets i think is the reason why you are seeing the stock down. to be honest, it's not down more two.a percent or caroline: still a hefty valuation. aurag -- anurag, great to have your perspective. sticking with microsoft, the world's number two cloud platform, is nipping at amazon's heels. ahead of the company's earnings results, we spoke with the executive vice president for worldwide commercial business about the growth in this very unit. >> when enterprises choose to go to the cloud and shoes to truly digitally transform their businesses, they are choosing to transfer -- to partner with microsoft. ubs chose to move their risk management solutions to azure,

not because it's a motion of moving their assets to the cloud, but, as the largest manager of wealth in the world, it's critical that they choose a partner that operates in more regions than any other cloud provider and choose a partner that adheres to local data sovereignty and security laws. the investments we have made in particular for the globally systemic, important financial firms, are what's fueling the growth in financial services. we have announced relationships with ubs, visa, metlife, and geico. we are seeing the fuel of differentiation for our enterprise growth. caroline: are these enterprises ever moving off aws and off google to microsoft, or are they already customers of yours? many of them have been microsoft customers for years. the trust they have with microsoft in the enterprise space, that leads to them

choosing us as our -- their preferred cloud platform when it comes to their most important workloads. we see it as a multi-cloud world. we think customers will dabble with our competition. when it comes to building new businesses, truly digitally transforming, establishing new product lines, they want to go with a partner they trust and one they have trusted for many years, so many of them are choosing microsoft as their enterprise cloud partner. caroline: what about the move to a hybrid cloud? many companies have been slightly concerned, more risk-averse towards moving purely to a public cloud. you are offering a hybrid stack coming in mid-2017. is that a real area of growth for you? -- massives a method area of growth for us. we see customers needing to leverage hybrid cloud technology. the first thing you have to get right in any of these digital transformation scenarios is to get your data estate right. if you operate in a highly regulated industry or in many

parts of the world where the public cloud may not be appropriate, the notion of leveraging what you have in your data center and coupling that with the public cloud to serve up a better offering is what we see customers doing today. the deep intellectual property investments we've made in on premises technologies for many years and is the same codelines we leverage in the cloud allow customers to leverage hybrid cloud with one common investment frame. they can write once and deploy anywhere with the microsoft cloud. caroline: looking at the competitive landscape, a ws -- aws, google saying they could see their cloud bigger than their search part of the business -- where does microsoft see its cloud business? judson: we are two minutes into a very long game right now. we like the momentum we are seeing. certainly in some of the biggest growth industries and the biggest markets, from financial services to global trade.

the relationship we have announced with mercer -- maersk to aerospace to the connected car. this will fuel our growth for many years to come. caroline: that was some of my conversation with judson althoff. catch our full conversation on bloomberg.com. now, a story we are watching for you, the foxconn chairman is planning to meet with president donald trump in washington next week. that's according to a report by nikkei. no word yet on what the two parties will discuss, though manufacturing and trade are likely to be top of the agenda. coming up, our exclusive interview with the ceo of boxed. how the startup is planning to take on amazon in the battle for household goods. and just to recap one of the biggest tech earnings of the day. alphabet shares popping in extended trading. we just heard from alphabet's ceo on the investor call,

addressing the youtube ad backlash. >> brands and agencies understand how hard we work to create as safe as possible and environment. we do this while being very careful to ensure youtube's innovative creators can earn uniqueo support their and popular content. we have been actively engaged with conversations with clients about the new tools we are providing, and we are having very productive discussions. ♪

areline: amazon shares continuing to surge on its impressive first-quarter earnings report. one company that perhaps might be so -- not so daunted by this competition is boxed. it is betting that its their inventory and automation system will give it in a over its much larger -- give it a anbang edge

over its much larger -- give it an edge over its much larger competitor. we are blessed that our business is growing very rapidly. there is a huge shift of consumers buying cpg online these days, so luckily it's more about capacity than it is about bottom line dollar savings for us. for us, it's more about getting enough packages out the door, rather than needing to cut every last person on the warehouse floor. caroline: therefore you can automate. you are making it more efficient. surely it means you're going to be able to hi fewer people going forwardre -- to hire fewer people going forward with this efficiency. chieh: anyone out there doing the simple math would be able to tell that we won't be hiring as quickly, but, at the same time, we are awfully loyal to the folks who got us to where we are today.

that commitment to them stays true and no one will be laid off at our current facilities. caroline: when you look into some of the perks for your employees, you offer them equity. you offer to pay their tuition fees for their children. you pay for the weddings of their children. how expensive is a wedding in your minds eye -- mind's eye? is this a way to show that it's all about the employee base? chieh: the message out there is that we are still hiring, even for news anchors. if there's any life events coming up, you are welcome to apply as well. caroline: i'm good, thanks. chieh: it really is a little bit -- it's a little bit of a contrast, as just being a technology company, but me and the management team being pretty old-school in our policies and philosophies towards the folks that work at our company. about a quarter of a century, maybe 50 years ago, it was the norm to take care of the folks that work for you day in and day out. that has largely gone away over

the last 50 years or so, and we are trying to bring that back. sometimes it doesn't make sense on paper, but when you think about all the things we have benefited from, not only their hard work, but the lack of turnover in our company, you start seeing other benefits, rather than just looking at p&l all day. caroline: talk to us therefore about the difference in business model that you have to the larger everything store, as we call it, amazon. they have 350 million is a go products. you have 1500 -- 350 million physical products. you have 1500. how do you pick those? chieh: we hire people who are way better at it than i am. we started with 200 items and they were all wrong because i picked them. our chief merchant used to be head of sam's club west. with her 22 years of experience, she does a way better job than i did in the garage 40 months ago. to your point, it really is the

opposite of what amazon does. i still feel like amazon does a really good job at being the everything store, but our consumer wants to stock up. our b2b consumer wants to stock up for their businesses. even in the bloomberg office, i see a multitude of snacks, drinks. and i'm 120% sure you guys aren't ordering that off amazon, and there is a reason why. that wholesale consumer doesn't want access to everything. they want a limited assortment, large format only. they want to access it with ease. they want a great deal that's only offered if you move a lot of that single upc. that's core to our business model. caroline: how much more will we see a focus of purchasing online for grocery items than is currently the case? what kind of penetration do you see in the u.s.? chieh: it's only 2% or 3% depending on what study you look at. in western europe, it's as high as 10%, depending on the

country. it's not going away anytime soon. as the shift gets bigger and bigger, that shift and the speed in which it is asked -- it is shifting is accelerating. i think we are awfully blessed that we picked this industry and we are on the other side of the table. i think there will be some retail pain continuing to be pervading throughout the industry. caroline: no membership fees. what sort of update you have for us in terms of numbers of members and where you want to grow? chieh: from take on in hands 40 months ago -- from tape gun in hands 40 months ago, we have millions and millions of customers. it's widely reported we have crossed the nine figures in trailing revenue within less than three years after launch. i think we are in a good spot. if you're thinking about it as a poker game and thinking about the overall industry and industry change, we think the river card for us is a pretty good one. that's why i have this big smile on my face. i guess i have it all the time. caroline: a very upbeat boxed

ceo. coming up, we continue our coverage of tech earnings. how gopro's turnaround efforts are faring. we'd like to bring to your attention are interactive tv on then at tv bloomberg. you can watch is live and dive into any securities or functions we feature. you can become part of the conversation by sending us instant messages during our show. this is bloomberg subscribers only. this is bloomberg. ♪

caroline: now, it looks like areo's rebounding efforts showing results. the technology company known for its action camera reported earnings that exceeded sales estimates. the company, which is not profitable, reported $218 million in revenue for the first quarter, exceeding analyst

estimates. joining us to discuss this and a few other tech headlines that caught our eye, bloomberg's selina wang. gopro, a company often watched, the fall from grace, seems to be picking up. 19% increase in revenue. selina: these are the first signs that their vast turnaround efforts are starting to take shape. i spoke with the chief operating officer, who has vowed to cut costs, streamline the workforce. we are starting to see that take shape. they did reduce operating costs. they said they are still trying to reach profitability by the end of this year. we saw some new revenue growth areas from the drone coming back on the shelves as well as their hero 5 camera now recovered from production delays and international growth. caroline: gopro looks like a go story. baidu is not looking as pretty. selina: baidu missed forecast for the second quarter and they also had a bit of a mixed bag.

they only barely beat some of the sales estimates. this is a company that has faced a lot of headwinds from alibaba and tencent. in china, they call it the b.a.t. the b part has become much diminished. they are well known as the google of china. they used to dominate the online ad market. now they are seeing alibaba take market share in their core business. they have tried to venture into other businesses like on-demand. even in those other ventures, are taking tencent market share. they had to recover from some regulatory scrutiny last year. caroline: talking of the competitive landscape, i want to shift from public companies to ones we all sit and watch and wait for when they will become public. we're talking ridesharing. lyft, it looks as if they have dimed out on uber's turmoil. selina: received some financials that are actually private and

they showed that lyft is benefiting tangibly from the debacle that -- with uber over the past few months. we saw ridership increase dramatically. looking increased dramatically. they have losses of about $130 million in the fourth quarter. they have cut that significantly from before. everything is on the correct track for them as of now. they recently raised a very large round of funding at a much higher valuation. while they are still a fraction of uber's business, these numbers show they are well on the way to gaining market share -- continuing to gain market share. caroline: absolutely fascinating whirlwind. bloomberg technology reporter selina wang, thank you for joining us. on the car theme, there's a great bit of news. go to bloomberg.com. get into the apple ticker. we have photos of the first apple autonomous test car. a lexus, it would seem.

these have been got by our great reporting staff. we have been looking at some of the key movement into apple's autonomous vehicles. here you have some of the first-ever photos. go to your bloomberg now, get into bloomberg.com. check them out to see what apple is trying to do to keep up with the likes of waymo and uber when it comes to the likes -- to autonomous vehicles. let's recap some major movers. atant to be looking overall alphabet, up 3.8%. amazon. seeing outperformance in terms of adverts. amazon is continuing to outperform on a revenue basis. microsoft has a look so pretty on the surface. the pc a little bit lackluster. microsoft has been that record highs. intel, down 4% in after-hours

best part ofr its its business failed to live up to expectations -- after part of its business failed to live up to expectations. facebook, alphabet, netflix, and google -- they have been outperforming. netflix, amazon, google, facebook, all of more than 30% when you are tuning into facebook over the course of year to date. how much has the outperformance topped the s&p 500? check out that line at the bottom of your screen. it's been hot in tech for 2017. this is bloomberg. ♪

♪ announcer: from our studios in new york city, this is "charlie rose." charlie: we begin with the unveiling of president trump's plan to overhaul the u.s. tax code. the white house considers this the biggest priority to boost economic growth. proposals earlier were dramatic, called for sharply lower rates for businesses and individuals. it represents a first moved to begin negotiations with congress. i am joined by peter coy of business week and from washington,