be blocked on the euro bonds the euro bonds are not the only way to finance what is needed, and i am confident that they can deliver, but it has to be done as soon as possible. >> excellent jean-claude trichet, i thank you for joining me stay safe. carl kiquintanilla, back to you >> thanks. rick santelli. good morning welcome to "squawk alley." i'm carl quintanilla with morgan brennan and jon fortt coming to you live from various locations. moderate losses on the dow down about 1% off of session lows which was down about 378 earnings are the big story whether mcdonald's or twitter or facebook or microsoft, tesla, comcast, our parent, morgan, and we're starting to try to dig out some trends here one is obviously signs of hopeful stabilization in the month of april while looking at efforts to rein in spending and in the case of boeing, continue to raise liquidity in this

seven-part debt offer that's getting priced today >> it's so true, carl. i think that word stabilization is really the key to the story here it's signs of stabilization versus recovery and i think that's a key distinction and one playing out right now in the market whether you're looking at the ceo commentary on earnings calls or interviews on this network in recent days and the fed chair's message yesterday, arguably what we're seeing in jobless claims, which are still so painfully elevate right now, but seem to have potentially peaked maybe three weeks ago, that the emerging theme is really that economic recovery is going to, at least based on everything we've seen right now and what we've heard right now, is going to take longer than initially thought, but there are still some of these potential signs suggesting that the worst, i say that with caveats and uncertainty still clouding everything, that the worst is over, whether it's the comments we got from facebook on that earnings call yesterday or

alphabet or macy's, which is reportedly looking to open its roughly 775 stores in the next six weeks potentially, but still expects that those stores that come back online first to really only operate at about a fifth of their normal sales volumes, at least at first that being the key, stabilization versus how long this recovery is going to take to play out in the coming weeks, coming months. jon? >> i hear you, morgan, and i agree with your general takeaway, but i have to say i also think that a lot of this stabilization that executives are talking about is predicated on the idea that things start to open up in june and that, as a result -- >> 100%. >> we don't end up with the some big step backward in terms of infections and having to go into a second phase of lockdown another takeaway i'm getting from this earnings season is that a certain set of big tech companies, some of that includes what we've called the f.a.a.n.g.

stocks, but they have a lot of cash, they're pretty dominant in their markets and have diversified portfolios of business, whether cloud, subscription revenue, et cetera, they're doing unusually well in this environment and for the people who are concerned about high valuations heading into this and was it a repeat of the dotcom meltdown scenario, at least with this first shock it seems the answer is no look at microsoft and how well it was able to balance the advertising related losses in search and linkedin versus the strength in azure and 365. look at qualcomm and what it was able to do which we're going to talk about in a moment look at facebook and its ability to see some stabilization in april because of some direct response advertising versus some of the other categories that are less stable for them carl, i think it's a really interesting, but varied picture. >> yeah. indeed

i mean there are companies that, to your point about microsoft, have huge utility in the currents of a global pandemic, contrast that with some obviously the targeted areas like retail and restaurants where you have in the example of mcdonald's 100% of stores in china now open, but traffic still subdued. we come back once again to the question of, even though reopening may have occurred technically, to what degree are consumers comfortable leaving their homes and getting back to business. >> yeah. that's going to be the key question and it's going to be the one that plays out in terms of all that economic data. we saws it with the first read on q1 gdp as well with negative 4.8% that was led lower by personal spending and you take that and look at the jobless claims, more than 30 million unemployed now and you have to wonder how this is going to play out, how painful these numbers are going to be in the coming weeks and thus how confident consumers are going to be to come back.

i want to watch in terms of this, jon, something like operation warp speed, the government's push right now to try to get vaccines, hundreds of millions of vaccines, ready by january, which would be absolutely unprecedented and one for the history books and probably make a big difference as well. >> that's important. in the nearer term we've got apple, amazon and visa earnings which will give us looks at very important large companies in their categories but for now one of the big earnings movers this morning is qualcomm, up and then down, and up again, about flat the company reported earnings and revenue beats last quarter forecast of the current quarter will see a 30% drop in smartphone sales and sticking to its projections for 5g shipments this year. joining us is qualcomm's ceo steve mollenkopf good morning >> thank you, jon. good to be here. >> i want to talk your specific quarter in just a moment, but

first, you've got a great view of the big picture so i want to go there i heard two signals from you last night that on thes surface might seem conflicting smartphone shipments impacted down 21% last quarter and expected 30% on this quarter, but on the other you expect a robust 2020 for 5g how are both happening at once >> i think you have to look at the only data we have really that's firm is what happened in china and they are a little advanced relative to the rest of the world in terms of when this pandemic hit them. what you saw was a pretty big drop in the march quarter, but then really well on the way to recovery by the time you got out of march and certainly into the quarter that we're in. we see that in orders and wie se that in handset reports from our licensees. if you project a similar model to the rest of the world and that model is backed up not only

from what happened in china but also kind of what you see in exit rates leaving the march quarter, we have some visibility because of our chip orders and have estimates from some of our licensees, you lead to a view that yes, we are going to see a pretty good drop in the june quarter, but we do expect that to, on at least how it exits june, to be in a much better position so much so that we feel confident with our 5g forecast for the calendar year. part of that is really being informed by the intensity with which the operators and primarily the hand seth vendors are making sure we keep our schedules and launching phones on time. i think there's a big impact to the near term, but long term, these trends are, we think, quite positive for our business and we thing for others as well. >> that is a positive signal,

steve, on the idea that the oems are still going to launch these phones and are pushing you to do that give us a sense of what that signal really means? it seems to me, if i'm an oem and i think there's any chance i could still launch my phone this year, i'm going to be pushing you to deliver on time even if i don't think it's a great chance i'm going to launch this year. are you picking up a signal that they're still hoping to launch this year but it might be a distant hope or can you be certain that's what they really expect to do >> if you look today even in the quarter we just reported we kept phone launches on time based on our deliveries remaining on time and people wanting to launch you got to remember the view primarily from the asian oems is that while we are through this, now we need to get back to normal sell in and if you look at the intensity with the chinese oems and market is pushing 5g, 70% of the new

handsets being sold are 5g related and they're already back to more normal levels of sellout, you know, you can see why they would have a lot of intensity. even worldwide, with the exception of i would say northern or europe having some difficulties, significant human toll there, be deployment schedules that 5g is on, still being pushed with a lot of intensity, so i think it's -- this is real people trying to meet launch timings and making sure we have it and making sure we have supply, things like the supply chain are humming and now it's just a question of how does the consumer respond >> tell me more now about china and the degree to which we can extrapolate that out for the world when it comes to how this crisis affected smartphone sales? did it affect all price points equally? when it first hit were people

buying lower end phones, higher end phones more? when it's starting to come back are all price points coming back equally or more on the lower or higher end. >> it's broad. there are two trends one is that it responded or it came back much more quickly than we expected, meaning that it's recovered very quickly it also -- the penetration level or the point that is now 5g is actually extended down i think it's been a broad-based recovery and, you know, we hope that's the same thing in the rest of the world. we've given our model for what we think will happen and we hope it's helpful that's what we're planning for as a company, we think the technologies of 5g be the trend of being connected more, that's the thing we've learned through this episode and we have to be prepared to take advantage of it. >> one thing that gives me pause is china's policies for testing,

for quarantining and locking down and then opening back up have been different from the rest of the world so i wonder whether the recovery in the rest of the world can track the same way? tell me, how soon are you going to know whether the recovery in the rest of the world is tracking the way it did in china? >> you know, we're obviously fairly far into the quarter and things like chip orders for us are well known and fairly firm it's always an estimate in terms of what the licensees will actually sell in the quarter, but we have a pretty good sense on what that's going to be the question is, what is the exit rate coming out of june and what does the shape of the curve and how does the consumer respond and i think it's also important to remember that the phone sales, depending on where it is in the world, has a different mix of online and off-line, whether you have to come into a store or not there's a lot of variables to mix into it but this is our best

view as to what's going to happen and it's informed by not only chip orders but what our licensees are telling us >> steve, we've been talking about geopolitical tension and friction between the u.s. and china for a while now as it relates to the industry, but now this week you're getting more headlines ate pompeo and probes into the origination of the virus and so forth do you expect rising walls between the u.s. and china to be material to the business >> well, i would say you have to kind of look at the level -- the short answer is i think in our industry, the focus is on launching products and technology and the reality is we work fairly well together in ord to do that, from the standard bodies into the delivery of products it's a fairly -- there's a lot of cooperation that goes on, not just isolated to china there's always a -- there's a lot of, you know, cooperation as

well as competition. but i don't see that as the narrative that's dominating the work flow. if you look today it's about get these devices on time, help me become a global player and how can we make sure the industry and the world is ready for 5g. i think it's probably a discussion at the parents' level but at the kids' level where we play, we're focused a lot on our work >> steve, as the ceo of a major company that has operations all over the globe right now, what are the factors, what are the data that are shaping your decisions about how you are making decisions around production, how you're making decisions where your workforce is going to be located and how long how important are things like testing to that equation >> we're in an enviable position because we have suf liquidity and strong balance sheet and our focus is making sure the company

is prepared to take advantage of really the benefits of 5g, and although we're obviously in a difficult position as a country and the world due to the corona 19 situation, but it proved to everyone that this work from home, educate from home, telemedicine, all of the things that 5g can bring at scale in terms of fundamental technology is very important. we are spending a lot of time making sure that we are prepared when this thing snaps back to take advantage of it even in the way in which we're working it's consistent up with that we have people working from home, still making productivity and launching phones and fixing bugs and taping out chips, doing all of this work, tremendous amount of productivity as lot of our employees are basically saying this is working so well, could we continue to work like this even after we have the ability to come back and i think that's going to be the trend for a lot of places and we want to make sure we're ready to do that

our geographical separation, our spread around and how we do work, has actually helped us have the infrastructure in place to respond to something like we've had to over the last quarter. i'm not sure the world is going to go back to what it was before and it's probably going to use more and more of the technologies that we're inventing and we need to be prepared for it. >> you've talked about that and talked about kind of the wide range of risks that we still face what type of defense is qualcomm prepared to play in the second half if we hit more rocky terrain? you talked about the strength of your balance sheet how are you prepared to either manage costs or shift things around should you need to? >> i think like any company we have levers that we can pull, but i can tell you that primarily the discussion is how do we make sure that we're prepared for the upside and the

snapback, whenever it should occur. like any other company, we have levers that weekend pull if we had to but i can tell you, the emphasis is much more on the opportunity than the downside concern. >> i've been saying i was looking forward to the data to come out of earnings season for a while and this is some of the best that i've seen that just gives a look at the entire technology landscape i'm grateful for that. i wonder, what is it as a business leader and technology leader that you want to see, whether it's from governments, whether it's from other institutions that you think would help to lift all of us out of this situation as quickly as possible i'm talking in terms of whether it's testing, whether it's policy, what would help you? >> well, i think, you know, if you look at the way a company runs, looking inside, this environment is one that you don't have a lot of strategic,

you know, uncertainty as to which way to go. you have to get through it, what you're working on is important and be prepared to take advantage of it. i think the next phase that business leaders will look for is how do we make sure the psyche of the consumer is repaired as quickly as possible. and i think that's one of the more challenging aspects i don't have any great idea as to how to do that, but i think that's the thing that will have the biggest impact to business worldwide is not so much how they operate internally but how does the market repair itself and the consumer feel comfortable to do many of the things that the broad economy needs for it to be successful. >> good insight. i happen to think -- i think we here at cnbc believe that reliable information is a key part of building that confidence so thank you for doing your part and providing it steve mollenkopf, ceo of qualcomm. >> thank you >> coming up after the break,

microsoft's head of gaming and president of xbox will join us in a few minutes don't go anywher wee ckn o. woman: my reputation was trashed online. i felt completely helpless. my entire career and business were in jeopardy. i called reputation defender. vo: take control of your online reputation. get your free reputation report card at reputationdefender.com. find out your online reputation today and let the experts help you repair it. woman: they were able to restore my good name. vo: visit reputationdefender.com or call 1-877-866-8555.

welcome back microsoft getting a boost this morning after a beat on the top and bottom line saying the covid-19 outbreak had minimal impacts on its results last quarter and seeing an increase in its business including gaming

xbox seeing record gaming and phil spencer joins us now. thank for being with us. >> thanks, how are you >> doing well. hanging in so when i see all-time record engagement for the quarter, nearly 90 million active users of xbox live how much was existing users and new people coming to the platforms? >> absolutely. we've believed for a long time that gaming is just one of the most social and interactive forms of entaintment on the planet and microsoft has been invested in gaming for a while and at a time when people are physically distanced from their friends and family the fact that so many are looking at gaming as a social outlet is testament to what gaming means. like you said we've hit nearly 90 million on xbox live, subscription services reach over 10 million subscribers

it's becoming a strong social fabric in the home at a time of need which i'm glad we can be there to offer that service. >> how durable is that fabric? when sports start to come back online, people go outside as some of the shelter in place restrictions are lifted, is this a tipping point and i guess in terms of more broad-based main stream adoption of gaming or will some of that start to slip away again >> obviously as the world starts to shift back to more of a normal state we'll see some moderation in certain things, but gaming already, prior to all of this, a third of the world's population plays video games half the connected world, it's nearly the gaming business is $200 billion globally, so it's a big business already, and i think what you're finding and what we're seeing now is people creating friends through their gaming experience, families playing in the home. we've had over 23 million new

friend relationships built through game passes. people are sitting at home building these digital relationships with people, socialized through video games i'm sure there will be some moderation, but i also think gaming activity, whether it's in the house, the family together, or people playing online, is just going to continue to grow as it was before the c-19 pandemic >> hey, phil, it's jon fortt. great to see you. >> hey, jon. >> how is this crisis affecting your plans for the launch of the xbox series x? still the same date? still the same volumes >> great question. yeah we're learning every day i say over and over the safety and security of our teams is the most important thing obviously creating safety for our customers online with our services, critically important as you look specifically it's an exciting year for us, we're launching an xbox this year. it drives so much excitement on the teams and the community.

teams are doing a really good job on keeping our hardware on track. i would say the bigger unknown is probably the game production, just being honest. game production is a large-scale entertainment activity now you have hundreds of people coming together building assets and working through creative on the hardware side we feel good about our plans and feel like our plans, there's obviously some impact to schedules, but overall i think we're on -- in line with where we thought we would be on the game production side we're learning every day i feel good about it, but i also need to make sure the security and safety of the teams is the most important thing and not unduly push when things just aren't ready >> yeah. phil, that was where i was about to go with you, the content pipeline and what that's going to look like the other big focus i think is competition. obviously microsoft is a giant in this space. twitch, which is owned by amazon, facebook has unveiled more gaming plans and apple as

well how fierce is competitive landscape given the fact that there is so much more opportunity for more people to come and use these platforms and be engaged in amore meaningful way. >> we're seeing the big tech players come in and see this gaming opportunity we think in order to achieve success you need great content, a large gaming community, and more and more we're leveraging our cloud assets at microsoft to deliver our products to people on the devices that they already have we have a long history, it's why the 90 million people on xbox live is an important metric. a community of people that are already coming to microsoft looking for their gaming entertainment, looking for their great games, those great mine craft experience, whether it's education as kids are learning from home or playing with friends, playing halo online, we have great content from our first party and our third parties on our platforms we have a large community.

this cloud asset, something that we're really leveraging right now, the partnership between xbox and azure is very strong. we have hundreds of thousands of people even in our preview we haven't even launched our cloud streaming in a general availability yet, but hundreds of thousands of people playing xbox games with x cloud and i think the competition will be there just like you said, but i think our long history in gaming is microsoft building up this community and the large content base along with our strength in azure makes us uniquely positioned >> phil, earlier you mentioned the social aspect of gaming and i got to say in my household i have a 9 and 11-year-old and that's probably the biggest change i've seen whether fortnite or mine craft, they are connecting with friends and playing, but i want to ask what you're learning watching that and other things how has what you're seeing in the surge of usage, the surge of social, how is that going to change the way you develop

platforms in the future, whether that's how people interact in games or the way games are delivered the way people purchase them. >> i'm glad your kids are having a good time playing, jon some of the things for us that have been foundational to being team xbox is the safety and security of our community. we invest a ton every day ensure as kids are coming online to play fortnite, mine craft, that we have an environment that is protected where parents through the parental controls mechanisms we've put in place feel like they have control of who their kids are playing with, what content, how long they play, we have family timers people can put in place, those things are really the bedrock for the growth that we're seeing now i think those things have to be in place and we have a long be history with those in place as you -- as we grow right now with so many people coming online

i think that's a great baseline for us the question about new things we're seeing i think the thing of people finding their digital friends, finding people who have shared interests online, people like to play fortnite, like to play, you know -- build things in mine craft, we're seeing things like i don't know if you saw the students at m.i.t. rebuilt the full m.i.t. campus in mine craft. people had never played together, being helped by people who have played. people coming together to achieve things online. as people are going outside i'm sure some of that will moderate but we're seeing the digital friends and gaming friends that social and community really grow and it's not just three or four markets. when you think about something like xbox game pass it's in 41 countries today and you think about streaming and taking this experience that we're building to continents like africa, countries like industry, wheia, they're not buying gaming

consoles but want to experience the same social community your kids are playing as they're playing and we can really connect the world through our networks and through the power of play. >> phil, i wonder, i mean with schools closed, have you seen the average user get a lot younger? you have to imagine that some of these kids are not studying as much with online learning and then on live sports, is the return of live sports a liability from a mind share standpoint or good because you need to keep enthusiasm about sports alive >> the education point, one of the things we identified early on in the kids schooling from home was parents who needed and were asking for some help, and what we did, we have a product, mine craft, one of our biggest games and mine craft education is incredibly important component of what mine craft is. we actually created in our community marketplace a specific educational forum so parents could go up and find the best

educational content that community had created for mine craft and we're actually -- gave some of those packs away to parents so they could -- as my kids are at home and your kids are at home and hopefully studying, mine craft is the interesting merge are you studying or playing, that's the magic equation for teachers and parents to have something that's a little bit of both on the sports side, the relationship between sports and gaming has always been strong. the athletes play. we have a ton of xbox fans and athletes we want people out playing everything should be in moderation gaming is an alternative for people especially at a time like this but people playing in the home and friends online, we do see an uptick in people's interest in esport right now because there's not physical sports that are out there and, you know, some of these behaviors and some of these interests people are learning during this time i think will stick with them.

>> all right phil spencer, thank you for joining us today shares of microsoft are up 1% post earnings. let's get the latest on the coronavirus, sue hereras has an outbreak update for us >> thank you, jon. good morning, everyone here's heat happening at this hour ford has made 10 million face shields shipping to all 50 states as it produces one every ten seconds. flight bookings in china are surging today after beijing relaxed some travel restrictions ahead of the mayday holiday. more than half of the inmates at a federal prison in southern california have tested positive for the coronavirus and two have died in what officials call the worst outbreak in the federal prison system. the "uss theodore roosevelt"" is preparing to return to sea after a thorough cleaning and new crew. hundreds of sailors on board tested positive for the coronavirus this month. as always, you can get more on our coverage by heading to

cnbc.com back to you. >> the ceo of slack on the other side of this break stay with us woman: my reputation was trashed online. i felt completely helpless. my entire career and business were in jeopardy. i called reputation defender. vo: take control of your online reputation. get your free reputation report card at reputationdefender.com. find out your online reputation today and let the experts help you repair it.

woman: they were able to restore my good name. vo: visit reputationdefender.com or call 1-877-866-8555.

want to get to deirdre bosa with a special guest hey. >> hey, carl, thank for that that's right, we have slack ceo and founder stewart butterfield. stewart, hope you're doing well and thank you for joining us. >> thanks for having me. great to be here >> now it's been more than a month since you recommended that all of your employees work from home you along with a bunch of other tech companies were early to this trend and you recently said that you won't fully reopen offices until september 1st. what does that look like what needs to be in place for you to get back to some kind of normal and have your employees go back to work? >> i think the real answer is i don't know there's so much uncertainty at this point and i think people really like to collapse that uncertainty because they

don't -- it's an unpleasant state for humans to be in. i cecsee compelling arguments o all sides. we're saying we don't expect to be back to normal until at least september 1st and not expect or require employees to come to the office we may before then open the offices to make it available for employees who need to get out of their house, but i think there's just, you know, still so much we don't know >> right are you encouraged by trends that you're seeing do certain testing requirements need to be in place for that to happen what are your indicators to know when it is time? >> you know, ultimately an organization like ours who is surviving well, working from home, in other words we're still productive and serving customers and making new developments, has much less of an incentive. there's no prize for being first here so i don't have any specific expectation or requirement. it's more just wait and see. >> so stewart, on microsoft's

earnings call last night teams was mentioned 42 times that was up from nine times the previous quarter even azure was mentioned less at 35 times sounds like microsoft is pouring everything into teams. now i know that the competition is fierce but at the end of the day, slack has substantially less cash on hand, less of a reach into the enterprise space. are you ready for this battle to heat up? are you seeing signs of it yo yourself >> i don't know that what we've seen over the last couple months is that teams is not a competitor to slack. they talk about the product and never mentioned the fundamentals of slack and it's been three plus years at this point that they've been bundling it and giving it away for free talking about us and over that time we've grown our entire enterprise business. all of our grid customers is more than $100,000 in revenue has come up. this perpetual question at this point a little puzzling for us,

that at some point microsoft is going to kill us another sense they have to be frustrated at this point they have 250 million office 365 users, announced an increase in growth of teams to a little under 30%. after three years of bundling it, preinstalling on people's machines and insisting administrators turn it on forcing users from skype to teams, they have 29%, which means 71% of the users have said no, thank you. >> hey, stu, it's jon fortt. good to see you. i wanted to ask you more about that competitive dynamic, because in some sense it's the classic best of breed versus large incumbent battle, but i think it's hard for us to see and understand sometimes how you view the competitive landscape and the path to the customer right now when so many customers are now aware of the need for a product in your category, what's your approach?

what's your strategy for converting customers and just in general continuing to grow your base >> the same stuff we've always done slack very often starts in a large organization, even our biggest customers which have hundreds of thousands of daily active users, a million dollars or more a year, they start with a work group and start with someone who thought i can improve how this happens, i can improve communication inside of this team or this business unit or this organization slack usage grows. we get in touch for them for a large organization, obviously it can be a complicated thing for people to buy software security review and vendor approval process implementation details, administration stuff, regulatory requirements for them, and in that environment it can take many months so we have sales and customer success teams that work with large organizations to do enormous deployments >> what is it that you have to do that's different then

i imagine there must be something, even if you're able to work well from home, your customers are probably in different locations, their processes are different -- >> sorry i might have misunderstood the question it's very different. in some cases it actually seems more effective for me to come on the show, typically i would have been in new york, i would blow 45 minutes going up town to the studio, spend time in the green room i'm going right back to work after this and just finished sml else immediately before this for our teams they're more efficient. customers are paying attention because this is an urgent issue for them and we don't have to travel you might, for a two-hour meeting, there might have been 14 hours of overhead now does that sustain itself that's hard to say kind of looking further out second half of the year, you know, field marketing programs are not running, events not running, executive briefing centers are closed but we're in the same position as everyone else and ask yourself, our are

ty teams going to be spending less net on software, 6, 12, 18 months from now? maybe at the margins, maybe temporarily, but if anything this has accelerated the digital transformation and adoption of software and come out of this, whenever we do, which could be 18 or 24 months, in a much stronger position. us and the whole software industry, frankly. >> yeah. stewart, this is morgan, along those lines, slack has been focused on business and workplace, whether it is within the office or whether it is now increasingly folks that are working remotely, i wonder with so many other types of entities, institutions and industries also remote right now and the possibility and i'm thinking of like harvard saying there's a possibility that they're going to be doing classes online come the fall as well, do you see other opportunities to expand into some of these other areas as well? could they be potential revenue streams for you? >> yeah.

we actually do pretty well in education. i don't -- i'm not sure which customers we're allowed to mention so i will stop but most of the ivy league and famous universities in the united states, some big state schools like arizona state, is a customer it's not that slack is an open messaging platform for students because i don't think that would be that useful, but deeply integrated into the faculty and delivery ofeducation materials i think that is a significant market for us and exposes slack to students which is great you know, thinking a little bit more broadly, organizations are being forced to do things in a different way and one of the things that becomes more important when you kind of -- if you're an organization that is reliant on in person meetings to get work done, one of the things important is more discipline around communication the cost of coordination and making sure people are on the same page, generating this alignment becomes more expensive. recently a couple days we had

viacom and cbs and they rolled out slack for 20,000 users there and we think about the merger going on kind of knitting those companies together at a time when there's the global pandemic happening, there's real challenges and it's an honor to be able to help in that context but that's happening everywhere. a challenge organizations have to up level how they communicate and rethink processes, from new higher on boarding to employee performance reviews to how they run their sales organizations. given it's not going to change overnight the investments make a lot of sense >> hey, stewart, it's deirdre again. earlier this month you raised $750 million in a debt offering that was upsized and carried very attractive interest rate of half a percentage point. do you feel you need to continue to preserve cash or potentially even raise more capital, especially since we're in these

uncertain times? microsoft is ramping up and you can secure it at such an appealing rate >> there's defensive reasons and there's kind of offense reasons for us to do that. one is we don't know how bad things are going to get on the macro and how long the recession is going to last or look like. having more cash, even though we were in a strong cash position going in it $750 million already on the balance sheet, but my motivation as one of the people who made the decision was much more on thes over. the acquisitions we can make, you're seeing softness in the advertising market, our dollars will go further there, i think we're in a relatively much improved position with respect to competition for talent and we want to be really aggressive there. i don't know that we can spend any more or that any more of a reserve would be useful at this point, but we want to be aggressive while we have this enormous opportunity. >> that capital raise was more of an offensive play but in a defensive play, a few

weeks ago you also raised some caution about sustainability you said that it's hard to know how much all of the explosive growth that you have seen is sustainable, given all of the uncertainty we are seeing. how is that going? are you locking down more enterprise deals what are you seeing among your small business customers do you feel any kind of responsibility to help them out renegotiating deals or delaying payments >> we actually have done quite a bit of that and we proactively reached out to our customers we know are most affected and a lot of businesses who kind of ground to a halt, revenue falling 80 or 90% and businesses that thought they had a year and a half or two years of cash on hand have 45 days of cash on hand. we're trying to find solutions that work for them i think the growth is unsustainable in the sense that we would have more than the entire population of the world using slack if the rate of increase kept constant, so i think what i'm more concerned

about is in the back half of the year, how many layoffs do we see or bankrupts with we see, companies or organizations pulling back and that's the question mark for us the initial stages of this have been a positive for the business, more new users, more new customers, more usage among existing customers, the expansion, but we are starting to see small businesses starting to pull back we have 110,000 customers as of our last earnings, so you can imagine most of those are small and medium businesses and we've yet to see what the real impact is going to be >> stewart, thank you for being with us today and i like the new background, like that you switched it up. >> hp garage thank you. >> all right deirdre, thanks you so as well and now new york state is out with its latest numbers on covid-19 here is governor andrew cuomo

just moments ago. >> the opportunity god gave us hospitalizations are down. good news. net change in total hospitalizations down, good news change in intubations down, good news new covid cases slightly down, 933, but still unacceptable. but down from where it was number of lives lost, still terrible 306. optimist would say the number is on the decline realist would say, that's a tremendous amount of pain and grief for hundreds and hundreds of new yorkers who lost a loved one. big question -- >> that is new york governor andrew cuomo with the latest numbers regarding covid-19 in the state right now, according to those numbers, everything is

trending down, whether it's hospitalizations, whether it's deaths which do unfortunately continue we'll continue to keep an eye on all of that and bring you headlines as we get them when we come back, the big earnings parade in tech. we'll break downs the numbers we've gotten and the numbers we're awaiting next with the ceos of microsoft, plalphabet ad twitter and why elon musk is so mad about it stay with us >> what the [ bleep ] do you think. people -- outrage. ♪ it will cause great harm not just to tesla but many companies. while tesla will weather the storm there are many small companies that will not. it's only human to find inspiration in nature. and also find answers. our search to transform... ...farm waste into renewable natural gas

led chevron to partner with california bioenergy. working to provide an alternative source of power... ...for a cleaner way forward. since 1926, nationwide we've been there in person, during trying times. today, being on your side means staying home... "nationwide office of customer advocacy." ...but we can still support you and the heroes who are with you. we're giving refunds on auto insurance premiums, assisting customers with financial hardships, and our foundation is contributing millions of dollars to charities helping with covid-19 relief. keeping our promise to be on your side.

woi felt completely helpless.hed online. my entire career and business were in jeopardy. i called reputation defender. vo: take control of your online reputation. get your free reputation report card at reputationdefender.com. find out your online reputation today and let the experts help you repair it. woman: they were able to restore my good name. vo: visit reputationdefender.com or call 1-877-866-8555.

it's been a crazy 24 hours of tech earnings, whether it's facebook, microsoft, tesla, c l qualcomm and apple and amazon on the way. yeah, thanks, carl i think there are some common threads for the large digital ad platforms that have reported alphabet, facebook, snap and twitter. while the pandemic has led to accelerating user engagement growth, it's caused this major downward pressure on ad demand starting in march. that's continued into april to varying degrees depending on the

platform performance down units have performed better than brand advertising which has really fallen significantly gaming, ecommerce, cpg while people aren't home while travel and auto have declined significantly. it really depends on the business mix of when you're looking at the platforms google search has high exposure to travel. that led to a 15% decline in their search biz facebook has a bit of a different mix. they have benefitted from their exposu exposure on the whole, it's actually been better than investors and we thought and you've seen the stocks run up a bit. >> mark, is there anything that argues against the notion that april will be a trough month on just about any metric you use

except for things like capex and things like that >> to kind of echo john's point, it's a very clear difference in the stories between traditional, call it brand advertising and the more direct response that's driving the digital events or activities it wouldn't surprise me at all on the latter if we already passed the mid to late part of march. we're seeing recovery on those ads coming into april. it looks like it's on the way back up. >> interesting for so long, 20% revenue growth was like this constant in our lives. it was unthinking some of these

big names would get below that facebook, 17 year on year is the latest in history. do we get back into that 20 range? >> we don't think so we have growth in the low to mid single digits the rest of the year there is no visibility past april. the management google, facebook, all reiterated that advertising is correlated with gdp growth. that that's why we're forecasting declines google historic ad decline for the year now and kind of limited growth for facebook.

there's so many different segments and factors to assess what are you expecting and how have the results we have gotten so far, served as potential read through this this afternoon? >> absolutely. i think we're looking across all three businesses and trying to figure out where things land the percentage of that's happening online has on the increased. i think every one is expecting a reasonably good number there i think with googlegoogle's clo business, i expect them to follow suit.

their decision to focus on only selling through essential items. you kind of cut off a portion of potential advertisers. they may be a touch slice on the ad side but the strength we have seen on the direct response business which is what amazon's ad business is all about, it's you should see some pretty strong numbers across the board. >> john, i'll put the same question to you especially since we got the results from ebay and when we look ahead to next week, we get more e commerce names >> yeah. for amazon, it's kind of like it's such an unfortunate situation but it's holiday like

demand they added 175,000 people to their fulfillment infrastructure last holiday season they added 200,000 people in north america. you're seeing a flux of demand we're expecting very strong results for amazon and very strong top line guide and also to echo the other points, the cloud business should do fairly well given what google and azure have come out with advertising is insulated most of their ad business is product search it should be good and the stocks been a great stock thus far this year >> mark, is a june ramp to

reopening up the u.s. economy priced in to most of these stocks at this point a lot of companies seem to be suggesting that they expect some kind of a recovery to start right around then. >> it's great question the answer is i don't know i think what we saw with the retail some of these stocks have been performing, we learned the bottom feels like we're kind of there and maybe slowly recovering that wasn't as bad as people thought. we saw numbers where some analysts were expecting facebook march refr knvenues to decline . they kind of kept flat i don't know if anyone has a sense of when the recovery will kick in whands it will look like they can plan their spend two o

or three months out. a very different horizon in terterm terms of how we look forward >> as i'm watching all of this unfold, i wonder is the regulatory risk to some of these companies now reduced because there's been so much focus on how essential they are and their size in some cases has been kind of aboon to them but arguably to a lot of others as well. >> yeah, i have to think in this environment that the regulatory risk would be reduced. i think going into this year probably facebook was kind of number one target. alphabet 1a and amazon less so i think in in environment and i think hear mark zuckerberg talk and alphabet management speak about all the things they are doing to help governments and consumers. i agree.

i think it's pull back for the time being >> okay. thank you, guys. so much to absorb. we're not nearly done for the week thank you very much. we're going to watch for some comments from the president. he'll been talking about contact tracing in new york state. now the washington post has a piece up in which they say that u.s. officials are starting to craft elements of punishment against china. for more on this we'll go to eamon. >> they're saying u.s. officials are beginning to explore proposals for punishing or demanding financial compensation from china for its handling of

the coronavirus pandemic according to four senior administration officials they're saying there's a meeting expected thursday. that is today. to begin mapping out a strategy for seeking retaliatory measures against china. we'll keep an eye on that and get you more soon we have it >> all right we'll look for some more headlines. let's get to the half and the judge. appreciate it. thank you very much. breaking news coverage of the markets continues now. welcome to the halftime report i'm scott wapner stocks lower after a pretty good stretch of updates s&p still on pace for it best month since 1987 we also got big earnings on tap tonight with apple and amazon reporting. we'll be all over that we'll do that with our investment committee, which is with me as always. joe is here today along with josh brown, and margaret reed is the senior portfolio manager