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Markets are slumping, violence is brewing, and Donald Trump is shocked—shocked!—there’s incivility in the public dialogue.
But wait, there’s good news. Microsoft, the former big-cap doormat of the tech industry is growing rapidly as it continues to churn out profits. Thanks to a robust cloud computing business, the software giant’s revenues jumped 19% in its most recent quarter to $29 billion. Profits of almost $9 billion rose 34%.
Microsoft is the ultimate reinvention story of our time. Its games business is surging thanks to the Xbox version of Fortnite. Its old-school Office software grows a bit and generates cash a lot. Its cloud business grows more quickly than competitor Amazon’s. That’s an achievement.
Making Microsoft grow after years of stagnation is like teaching an old dog a new trick. It’s an inspiration to every legacy company that’s trying to find a second act. It also is worth nearly $800 billion.
It’s enough to make you have faith in cherished institutions run by honorable people.
Techpocalypse continues. Amid Microsoft‘s most recent financial success, as Adam noted, pleased investors have pushed the company’s stock price up 2% this morning. That’s not enough to undo the damage from Wednesday’s regular stock session, when growing fears about a slowing economy, higher interest rates, and trade friction pushed the entire tech sector off a cliff. Microsoft fell 5%, but Netflix was down 9%, Amazon lost 6%, while Facebook, Adobe, and Google dropped 5%. Apple and IBM were relative stalwarts, losing only 3%. Still, most stocks in the tech sector still have healthy gains for the year (though not Facebook or IBM).
A real meltdown. Speaking of falling tech stocks, former stock market darling Advanced Micro Devices has lost nearly one-third of its value over the past 24 hours. In regular trading on Wednesday, AMD was down 9% amid the general gloom over semiconductor market prospects that emanated from a poor earnings report from Texas Instruments. Then AMD released its own third quarter results, a little light on revenue, and fourth quarter forecast, very light on revenue. In premarket trading, the stock was down another 20% on Thursday. Still, for the year, even after all the tumbles, AMD’s share price is up almost 80%.
Type it out for me. Sticking on Wall Street, Twitter reported its fourth straight profitable quarter, though monthly active users dropped by 9 million as part of a purge of fake and spammy accounts (which CEO Jack Dorsey had previously signaled). Revenue rose 29% to $758 million. Twitter’s shares had lost 4% in regular trading on Wednesday but popped up 13% in premarket trading on Thursday morning.
Fly the friendly skies. Hackers stole credit card, passport, and other personal information from more than 9 million customers of Cathay Pacific Airways, the company confirmed on Wednesday. The privacy commissioner of Hong Kong, where the airline is based, said the breach would prompt a compliance check and Cathay’s stock price dropped as much as 7%. Meanwhile, the United Kingdom fined Facebook just $645,000 for the massive and improper sharing of data with Cambridge Analytica. The social network ducked huge fines (up to 4% of revenue) because the scandal occurred before the EU’s General Data Protection Regulation took affect.
Opsec. And speaking of breaches, the New York Times had a blockbuster report that foreign spies are tapping President Trump‘s calls to old friends made on his old iPhone. Trump quickly responded on Twitter that the story was “soooo wrong!” and said he mostly used government phones. The tweet was tweeted from an iPhone.
A big blindspot. As noted yesterday, Apple CEO Tim Cook was blasting the “data industrial complex.” He wasn’t exactly volunteering to give up the billions of dollars Google pays his company for presumably flaunting the privacy of Apple users, though. And former Facebook security chief Alex Stamos criticized Cook on Twitter over Apple’s China policies. Calling China “an ethical blindspot for many in tech,” he added: “We don’t want the media to create an incentive structure that ignores treating Chinese citizens as less-deserving of privacy protections because a CEO is willing to bad-mouth the business model of their primary competitor, who uses advertising to subsidize cheaper devices.”
FOOD FOR THOUGHT
The news business is pretty competitive, but most scoops come from human sources. That’s not how 23-year-old software engineering student Jane Wong does it. Wong’s Twitter feed is a fount of information about new features and new markets that major tech companies are adding (like Facebook’s dating feature). She breaks the stories by reverse engineering apps and such, as she explained to Georgina Ustik at tech site The Next Web. But Wong isn’t about to start her own news publication and sees her future in the software field:
IN CASE YOU MISSED IT
Amazon’s Alexa Voice Assistant to Possess More Office Equipment By Jonathan Vanian
A.I. Songwriting Has Arrived. Don’t Panic By Dan Reilly
How Elon Musk Is Winning Over the Tesla Shorts By Jen Wieczner
BEFORE YOU GO
The voice of Fred Rogers, better known as the host of children’s show Mister Rogers’ Neighborhood, returned to television screens this week during the World Series broadcasts. Rogers, who died in 2003, sang one of his standards, Did You Know, in a commercial for Google’s new Pixel 3 phone, marking the first time the beloved figure’s voice has been used on TV to pitch a product.