>> i am alisa parenti. here is a check of your first word news. president trump welcome german chancellor angela merkel to the white house today amidst concerns that president trump is threatening to withdraw from the iranian nuclear deal. a new extension from new u.s. tariffs is also set to expire soon. the epa's internal watchdog is opening an investigation into administrator scott pruitt's russell of a capitol hill condo. the inspector general has concerned the probe, and the government's top ethics officer also push the epa to scrutinize that rental.

there will not be a tentative nafta deal in place. they say despite key progress on important issues, a push to have an agreement in place has come up short. ministers will meet again on may 7. the two koreas have agreed to end the war that began on the seven decades ago. north korea and south korea held a historic summit in the demilitarized zone. both sides also agreed to a nuclear free korean peninsula. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am alisa parenti. this is bloomberg. ♪

emily: i am emily chang, and this is bloomberg technology. coming up, big tex bounces back. how they close in style after a brutal starts the fiscal year. plus, we hear from expedia's ceo on their results. and the world's most viable company gets ready to prepare a preview of earnings. and the world's most viable companybut first, a cap turnaro. despite taking a beating, the tide changed again. this week, strong earnings from the likes of facebook coupled with better than expected results from microsoft and intel, and the crowning achievement appears to be amazon. blowout earnings pushed the e-commerce giant to push themselves to be the second largest u.s. company behind apple. down isbreak all of us bloomberg intelligence directors ,f north american research paul

and in new york, our stock reporter abigail. abigail, i want to start with you. where we ended up today after a rocky few weeks. >> it was an interesting day, because we started off very strong. nasdaqlly with the opening around 1% and only finishing a fraction higher. despite the rebound rally yesterday led by facebook and some other cap winners, today, obviously, amazon a huge point. enough.t the other stocks actually finishing lower. behind this is apple. apple started off about flats and then at session lows around 2%. apple reports next tuesday.

we have had some strong reports from these big internet names but the crowd report is apple. lots of chatter that the iphone demand is weaker than demanded. investors are nervous. what we are going to see around the march quarter could be a mess there. thathe june guide, is going to come in at less than is expected. there are some jitters from apple. despite these big tech reports, i think a lot of it reflects apple. you have an excellent peace out today that makes the point that these companies together spent more than $16 billion this quarter. and investors don't seem to care. talk to us about what they are spending this on and why the

markets into ignore it. >> i was really struck by the levels of spending by all of the big tech giant. and look, the spending is a diverse category. they are buying computer equipment to build data centers, alphabet bought out the chelsea market building here in new york city. amazon is spending on both their cloud computing operations and its package delivery and transportation network. to fulfill the ambitions of these tech companies that want to be in every nut and cranny, it is very costly, and that is showing up. part of this is that you hire more people and need a place to put the, what stands out to you given where the spending is happening. >> we are seeing it across the board. it really started with amazon.

jeff bezos and amazon have done an amazing job of conditioning the market is. -- marketplace. meyou can demonstrate to that the market for your business is big enough to warrant big-time investment, they will support it. that is what amazon has done. is really drive every amount of earnings they have back into their business, and other topanies have started to see conditioned themselves in going after a big opportunity. it generally gives them a pass on these things. we have seen it from alphabet, we are starting to see it from facebook. they had another big quarter of expense growth and that was generally supported by strong revenue growth. these companies generally provide high returns to investors. >> facebook has recovered about two thirds of what they lost the cambridge analytica scandal. abigail, what are we watching over the next weeks and months?

today, the realization that they are expected to disclose more scandals as we continue their internal investigation. i think what would turn sentiment towards the more happened because what in march was a big hit to investor sentiments. what could make it worse is if any of those revelations were going to drag on the top or bottom line. so far, everything with cambridge analytica the looks like it's not disrupting users or advertisers. but if some of the news to come out with suggest it would impact i think that, could create a dented sentiment. fact that we have had a

, itle bottoming here suggests that investors are looking past it. pictureinancial changes, the stock in sentiment would go with it. >> this is from fec filings were facebook says they expect to discover and announce more instances of misuse of user data or undesirable activities. this goingn is it is to be just a blip for facebook? can they recover and have a long runway, especially given the other properties that facebook owns. >> i think abigail is right. none of the privacy and misinformation scandals that facebook has been embroiled in have affected its advertising business. so that is the big question. it was pretty sunny to see a

sizeny of facebook accelerate in their first quarter, which is not easy to do. that shows that advertisers, despite all the noise, find that buying ads on facebook works. so unless that changes, it is hard to imagine that the facebook story starts to break down. the thing i worry about is on the user side. if you look at sentiment on the user side about facebook, it is that. the people generally do not trust facebook. again, that is not showing up in usage of facebook yet, but i feel like the scandals have a cumulative of that. they don't want to be on facebook even if it is useful. you know, that has been my sense, anecdotally.

that users are just annoyed or don't trust facebook. yet we have not seen that impact. paul, will we? is it because we live in this bubble? >> it is possible. we certainly did not see it in the quarter that was just .eported investors will still be looking at this. we expect margins to be under they are likely to step up spending to curtail r&de issues whether it is or artificial intelligence. what the market would find a negative development would be is orher their users decline their engagements declines in terms of daily active users. issue, butbe an let's not forget that there are other revenue levers for this kind -- company.

so even if the core product faces challenges, this company has other levers to pull. >> appleshare ended just over 8% down, of course, reporting on tuesday. you know, apple is kind of in a different category. primarily because it is a smart phone company. have seen this industrywide trend that is showing up in the smartphone and chip companies that have reported earnings that there is an industry wide slowdown smart phone sales. it will be very hard for apple to buck that trend. yes they are charging more for their iphone which offset some of the unit slowdown, that is the cross of apple's problem. globe,look across the

sales of smartphones are ground to a halt. all right, thank you both. we will have lots to cover next week. t-mobile and their owners are dancing towards a deal. terms, the deutsche telekom would receive a state and 69% in the voting interest of the combined come. -- company. previous discussions broke down last year after they could not decide how to structure control of the combined entity. coming up, we caught up with intel's ceo. what he has to say about the pass of the company's investment in storage. if you like us, check us out on our radio app. this is bloomberg.

>> after a tough few weeks, we are seeing rebounds. some of the most valuable companies in the world went a long way towards proving naysayers wrong, and that includes intel. earlier today, bloomberg markets caught up with intel's ceo. what we have been experiencing for the last and what weters, expect, is this unrelenting demand for computing performance.

primarily driven by the incremental needs for data that it be stored, analyze, and retrieved. fundamental trend is what we have been investing towards and we are reaping the benefits of. at the same time, i would say for the full year we do see cios because of strong gdp and strong earnings and they are refreshing their environments. speaking of which, amd is a stronger competitor than it was to you guys. their product is also catching eyeballs. have you see their competition. how do you save them off? it is the same, to deliver high-performance products for our customers. that is what we are focused on.

as long as we do that, it is going to bode well for our business. you saw our data center business was up 24% with strong performance in cloud, continued traction in our columns and , so we thinksiness we have the right set of products and performance that is driving demand at a unique time. as long as we do that, everything else will take care of itself. , i amaking of nvidia wondering what your plans for that business are, given that google is also in on the action. we have a very strong position with integrated graphics. it has been a core part of our product portfolio for a long time. recently, we have announced our intentions to leverage that strength in to solved graphics

some of the emerging opportunities with our customer base. so a great position, trying to leverage and extend that into new markets. >> can you tell us about the pc market. have we bottomed? it seems we have, is it stable? >> great question. i think what we have experienced during the second half of last year and first quarter this year is stabilization. as you know, it has been declining for a while, but those declines have somewhat stabilize. the first quarter, the market was relatively flat which for us is good news. our volumes were flat, so we think from a share perspective we are doing fine. more importantly, the mix of our products continue to up sell for higher performance products. it results in a relatively flat market.

our revenues grew 3% in the quarter. part of our full-year guidance increase was a function of both strength and the data centric business since -- businesses, but also data as well. when it comes to the chip space, what excites you the most? which area provides the best opportunity? can you sort of list it in order of preference? >> well first, as we talked we have dramatically expanded our markets. where we used to focus primarily on cpus, we now focus on increased demand for data.

so our product portfolio today includes cpus and fpgas and artificial intelligence for the data center, for pcs, for autonomous vehicles. so we have dramatically expand because thee serve continued demands for compute performance play to our strengths. we see those as opportunities and that is what we have been going off their and what has accelerated growth. ceo bob swan. dan sprayer breaks down the electronic signature companies first trading day next. this is bloomberg.

>> new candidates is planning to release a public cloud offering.

however, engineering challenges have put the lunchtime in doubt. the ceo has found that targeting amazon is harder than expected. lately, their stock has hovered that they will be able to compete against amazon microsoft and google. but shares fell on the report. cusign made their interview on friday. bloomberg deals reporters spoke with the ceo. >> i think it has been a long time coming, but i think it has been worth the wait. we have really transformed the concept of how people do agreements. our leadership in east signatures has created an opportunity for people to accelerate the way they do business, and for our users to have a simpler and better experience. that's why it is great to work in, because it gets us excited.

the number one provider of e-signature software, but it is still a new industry. where are you going to put this money to work? where is the continued growth going to come from as you move forward? >> we are actually very focused on growth. when we think about our opportunity, even though this is still 50 times our current revenue, we think the total opportunity is much larger. when you think about the opportunity to land new , now we have an international footprint, but still another opportunity for growth expansion. another opportunity for our growth is expanding with our existing customers. many of our customers only have a few use cases with us, and we

see the opportunity for hundreds. >> and i want to unpack this a little bit. in terms of building out into your new customers, you talked about in your deal perspectives that that might require increasing your sales spending. right now, 62% of your spending goes towards sales. how much more spending is it going to take? >> we have had a lot of success to date if you can see from the growth we have put together to get us to that half billion dollars. you are spot on. we are helping them realize that to drive their digital transformation, we are a key partner to do that. i will tell you, going forward that we are going to be aggressive with our marketing

because we think we have penetrated just a small part of the opportunity. >> you are a ceo of a 50 euro company. this ipl has been a longtime company and i have been tracking this for years. what made you sure that now was the time to get out the door? >> i think the company has been ready for a while, but there were a few things we wanted to do to ensure we had a good start. first, we want to be cash flow positive. was weond component wanted to prove that international opportunity you asked about earlier. getting 17% of our revenue from outside the u.s. was important. and we wanted to make sure we had the right team to make this company forward. with those for components, we are excited to be here in new york today. coming up, an exclusive conversation with mark oprah

strong. this is bloomberg. retail.

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wi-fi fast enough for the whole family is simple, easy, awesome. in many cultures, young men would stay with their families until their 40's. ♪ alisa: here is a check of first word news. united nations secretary antonio perez called the summit between south korean president moon jae-in and north korean leader kim jong-un historic. a spokesman for the remarks to reporters at the yuan headquarters in new york. >> the parties to build on their first meeting and swiftly implement all agreed action to further korean trust building and reconciliation, since your dialect, and progress towards sustainable peace and verifiable denuclearization. alisa: secretary pompeo, who was sworn in on thursday, said the u.s. remains committed to the alliance is for greater burden sharing.

>> on nato allies a great to defense spending by 2024 with 20% of the share funding major equipment. it is up to each alec to make it on the promised by present a credible plan for the summit in july. european nations must bear the necessary responsibilities for their security and make the case for fellow citizens. alisa: secretary pompeo also warned blanks of russia is trying to undermine democratic institutions. that you elect house committee officially declared the end of its russia probe, saying it found no evidence of the trump campaign colluded with russia in the 2016 presidential election. president trump directed to the props conclusion with german

chancellor angela merkel. >> no collusion or coordination, no nothing, it is a witchhunt, there is no collusion with russia. she probably can't believe it, who can? the report was very powerful, very strong, no collusion with the trump campaign and the russian people. alisa: former president george h.w. bush continues to recover, but will remain in a houston hospital in the weekend. he is being treated for an infection that spread to his blood. mr. bush was last seen in public attending his wife's funeral. global news, 24 hours a day, on the air, and at tictoc on twitter. powered by more than 2,700 journalists and analysts in more than 120 countries. i'm alisa parenti, this is bloomberg.

♪ ♪ emily: this is "bloomberg technology," and another earnings standout us week was expedia. reported earnings that beat forecast and rising demand, ceo mark okerstrom spoke with bloomberg. mark: trivago is in a transition period, and advertisers have pulled back on spending and has given us opportunity for smaller advertisers to step up. unfortunately the overall monetization of the platform is lower than it has been so we're on to get through this in the back part of your. the bottom line is it is a great thought from for advertisers to

advertise on and a popular service with consumers. we are optimistic things will get better as we move through. >> also because of your investments, how do you plan on making homeaway to your profit and bottom line from the next quarter and on? mark: homeaway is on acreage trajectory in terms of topline revenue looking solid. the issue with homeaway is not really an issue. they are a highly seasonal business so we pay for marketing in the first quarter and jerod strong bookings like we did this corner, and ultimately it will travel in the summer, and as one-run denies the revenue. we focused on homeaway's trajectory from a topline and bottom line in the full-year net income away will show that to be true as we move through the

year. >> when will it be fully integrated the core platform? mark: homeaway will operate on a standalone basis, but what we are doing is making homeaway properties available on the core brand suggest expedia or orbitz, travelocity, hotels.com, homeaway has 1.6 million online bookable listings and we have 175,000 of those life on brent expedia and other associated properties, working through the issues. we expect that when incentivize thousand number to climb steeply as we move through the year. >> you have success and large, but going forward, more deals and acquisitions? mark: deals is in our dna, so we are on the hunt can operate we are also discipline. over the last number of years we

have built an incredible portfolio of some of the leading brands in travel. right now we are in a position where we don't need anything else to be successful and to deliver world want to be. we are focused on making the most of what we have got and making sure we are being locally relevant on a global basis, going into countries and building currently powerful network for suppliers and consumers and making sure we are incredibly customer centric and we can increase the speed of execution and innovation across our brands. we're focused on solid execution, but we continue to be opportunistic on the m&a front if we see something that is attractive. >> talk about your marketing spend, how do you plan to make your marketing spend work for the rest of the company overall? mark: we have been at the skin for a long time terms of online digital spend and also in terms of television spend. we are highly analytical in the way we approach it. last year we spent over $4 billion on direct sales and marketing. this year it will be significantly more than that.

we're also looking for ways to make sure we get the absolute most out of our marketing dollar over the course of the first quarter. we were more distant and making sure we could prove to ourselves with real math where we are actually making appropriate returns on our marketing spend and where we weren't. that is going to be the course over the next period, and we are confident our marketing spend is smart spend and were looking to get more smarter. >> does that include a position on the likes of facebook and other social media spending? you plan to reduce that in any way, given the scandals we have seen over the last aromas -- last several months? mark: we don't plan to reduce our spent on those platforms, facebook continues to be a attractive platform where consumers are. there are other large advertising problems are people are thinking about travel -- whether they are dreaming about it or about to make a trip are present.

we want to be there. we are very cautious and concerned and we are very focused on making sure that consumer data is that with appropriately. that is always the case and will continue to be the case, but we are looking to spend more on those channels assuming we can get an appropriate return. >> international booking running strong but domestically we see a deceleration. airbnb at hotels making better offers, what do you attribute this to? mark: we feel domestic market continues to be healthy for us. the numbers we look at suggest we are growing at rates two or three times overall industry, from court to court can see movements in the first quarter because of easter timing this year versus last year. we did see easter, earlier and when people are on vacation they're not booking travel. on the margins that could be

moves from quarter to quarter, but we feel good about our domestic partners and funded about our position in the u.s. and the growth rates we are seeing. >> what are you watching over the next few months? mark: certainly we are watching the outcome of the travel ban, which is ultimately going to be decided by the supreme court in june. we are a travel company so we are interested in that outcome and with dementia not only do we have secure borders, which we absolutely have to have, but we are appropriate in representing our brand outside of the u.s. text reform has been a positive for us, and generally we looking for things to put more dollars in the hands of consumers. an increasingly around the world, and one of the first things consumers want to do when they get the next dollar in the pocket is take a trip. emily: our extensive interview

with expedia ceo mark okerstrom. shares of charter sent following dismal earnings results. there are losing customers to streaming services at a rapid pace. charter lost 122,000 residential subscribers, more than a year ago, and charter is not alone circling pentagon to pb customers. later this week comcast reported a loss of 96,000 subscribers. coming up, the thing continues to be red-hot and we hear from the head of two firms making waves globally. and this weekend on bloomberg tv we bring our best interviews from the week, including our conversation with peter cfo, on the heels of their earnings results. tuna and saturday for the best of bloomberg tech. this is bloomberg. ♪

♪ emily: acquiring a car pulling platform called -- initial terms of the duo were not disclosed, but it signals ongoing consolidation in europe's ridesharing space. blabla plans to acquire another french company. a digital banking company that offers current accounts and don't trading and money transfer raised a quarter of a billion dollars for investors, including the ft global. caroline hyde set with their co in london. >> we need the money for

collateral in some of the countries. >> how will you expand, the early -- particularly, how does one enter the banking sector in the u.s.? >> usually in the past for expansion, we are using licenses and we will launch our product. >> are getting new offices in the united kingdom, how will you increase the workforce? >> for the moment. [inaudible] >> is that the greatest challenge? the hardest thing is getting the right people. >> even if i were to get $5

billion now, i can't speak anything up. it is important finding the right people. >> where are you finding the right people? where do find the best talent? >> we look at london and across europe, we higher in russia. >> are you focusing on diversity? >> we have educated people focusing on diversity. >> that is quite an achievement. how will you continue to grow the business, does ethics come

into it, how do you ensure you still the way you want to see it scale? >> we have strategy and we just repeating. >> and making sure people are happy within the company? >> yes. >> how do you do that? >> if people love what they do, we hire people who love what they do. >> what about hiring people in the united kingdom and been launched in the united kingdom? you are only three years old, with a three-year-old ride. would you do it again in london? >> regulation is in support of fintech. i don't think anywhere in the world will find the same. the regulation is quite tough, and in other countries it is not there. emily: that is the revolution ceo with caroline hyde. and a fin tech startup reached more than a billion dollars in

deposits. gaza got a big boost earlier this month when they became the first him back to get access to a settlement account in the bank of england's full-time growth settlement system. selina wang caught up with their ceo about what it all means. >> this is great news for tech startups because now what it means is that startups get the same access to the payment system that the banks to enemies they can build products that are better in theory than with the banks have been doing so far it is as us -- it allows us to build a better product. selina: how much does reduce your cost by and how much faster does it make the entire process? >> and the u.k. were this is like this is amazing and the payment system works 24/7 and payments are delivered within 15 seconds to the recipient

account. what it means is that when someone makes a payment from the u.s. from dollars to pounds in the u.k., we are able to develop -- deliver the money in 20 seconds in any bank. selina: are you passing the payment on to consumers? >> would pass heavily on consumers and we have done price drops on the last four months. this is a big thing, and what it does is lower the cost for the user. to give you an example, the cost going directly to bank of england is about 30 times cheaper than i was able to negotiate with a commercial bank in 2013. selina: for this to be a game changer for you need other countries to adopt this. what is taking other parts of europe and asia and the u.s. so long? >> that is a good question, here and case this family are

frontrunners when it comes to financial technology -- the u.s. and u.k. have been frontrunners, and other countries are listening to. the u.s. is working on a payment system of real-time payments. canada is the same, australia the same, there's an initiative in europe, so the world is moving towards instant. selina: i want to talk about this borderless account relaunched last may, how has the adoption then, how many people are using it? >> it is going very well. the idea is to create this multi-country account where people can hold 42 different currencies and they can get local account numbers in countries outside of the u.s. they can invoice their customers. it is going amazing. it is mostly small businesses, and have moved more than a billion dollars now in the first

10 months through these accounts. selina: what is your expedition for how much this will grow and you want to contact businesses larger than small businesses? >> we see larger businesses starting to get to grips that this is a great new feature for them, and they are starting to use the same parts that consumers and small businesses already adopted. emily: transferwise ceo speaking with selina wang. coming up, apple gets ready to report and candidate should got the slump to start the year? this is bloomberg. ♪

♪ emily: amazon has jumped to number two in the rest to become the first trillion dollar company, chasing apple which was the largest u.s. company by market cap. but the cupertino giant is in a

slump in shares of apple have taken a hit since march, seeing a fall of over 8%. what can we expect when apple reports on tuesday? i bring in mark gurman who covers apple for "bloomberg technology". what their analysts saying now? mark: we are looking at revenues of $61 billion. and it is 15% year-over-year growth, but the iphone is apple's most important product and what people care about. what we are to see there is like these five or 6% growth. for apple, any tech of growth is high. but 51 million iphones, which is the estimate, is a very small number of growth compared to the past iphone growth they have had at this time in previous years. that is what investors are looking toward.

emily: what do we know specifically about how the searcher product is doing -- the signature product is doing? mark: according to apple the iphone x is the best-selling iphone, so that is not too surprising. some analyst estimates ahead of the results say the iphone x result is between 25% or 30% of all iphone sales during the quarter. when they launched the new iphone they lost it alongside other models, and the thousand dollar point was a sticker shock for a lot of people, and they also have to iphone 8 and a plus at a lower price point, and it was a decidedly new and was a much different than the iphone 6 or iphone 7, so it wasn't a big device to spur upgrades and then let the problem for apple in the middle of the market. also, there were two fonts that worked the right price and not as awesome. emily: how does apple fixed the strategy if it needs to be fixed?

mark: it absolutely needs to be fixed, not because there is anything wrong with the iphone x, it is just that the thousand dollars is sticker shock for too many people. thousand dollars is a lot of money, it is courser for over a month and multiple car payments and can even be a mortgage for some. there is a lot of money on a fun, especially when you don't need an upgrade. the way to fix it is to bring those cool iphone x features down to the cheaper models, and that is exactly what the company is going to do in the fall with the lower-cost model that looks mostly in function of the iphone x. emily: what are the bright spots? mark: the bright spots yet in this quarter will be services. we expect services growth to be between 10 and 20% year-over-year, and we're looking at services numbers to be around eight 5 billion reported in q4.

and q1, apple's first holiday quarter of 2018, to are working on new services and new products into the music space and susan area where likely to see between 10 and 20% growth over the next several years, augmenting the slowdown in growth that we are seeing in the iphone, bouncing everything out for the company's bottom line, the ultimate revenue number. emily: mark gurman covering apple, thank you as always in the note will be all over it as will we next week. that does it for bloomberg technology, and this monday will be live in tune in for interviews with steven mnuchin, david sullivan, sandel, arianna huffington, and much more. a reminder that we are licensing on twitter, check us out on weekdays. that is all for now. ♪ welcome to the xfinity store.

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