Ban rapid fire devices like those used in last years massacre in las vegas. A band could start a legal battle with gunmakers. Paul manafort and rick gates were indicted for a second time. The new charges include failing to report incomes, to the tax authorities and bank fraud. It could put additional pressure on them to cooperate. The late reverend billy graham will be brought to the u. S. Capitol where he will line honor in the rotunda until thursday, march 1. Graham died yesterday at the age of 99. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. I am Alisa Parenti and this is bloomberg. Emily i am emily chang and this is Bloomberg Technology. Coming up earnings season , continues. We will break down the results at Hp Enterprise at hp inc. Another spacex rocket blasts into outer space. How this launch brings elon musks vision of if after internet one step closer to reality. We lay out the game plan and the upgrades on tap for apples nextgeneration air pod. Hewlettpackard enterprise and hp inc. Reported earnings after the bell. They beat estimates. And topped estimates with a strong computer and printer sales during the holiday quarter, even as the industry stagnates. I want to bring in a research officer. What do you think are driving these results . Crawford there are a few things driving this. We have to unpack them. For a long time, hp talked about being better together. Clearly this quarter, they were better apart. They have a stronger ability to be number, to resize their infrastructure. Particularly in the case of hpe. In the case of hpi, this company is performing on all cylinders. They are in a market that is flat for pcs, that is normally nominally flat for printing. They are gaining share. They are putting up numbers like 15 growth year over year for 14 for total printing, 48 for commercial printing. Remember, that includes the samsung business that they acquired. This is the first full quarter they had that. Stellar performance and huge Operational Efficiency on the part of hpi. Emily lets talk about that. Are you expecting the strong computer and printer demand to continue through this year . Crawford i think what you are seeing is that infrastructure in general is continuing to get refreshed. In the case of hpi, the product is strong. The product has been getting stronger and stronger for quite some time. In the case of pcs, they are focusing on profit pulls that our margin rich. Inther it is detachable two ones, or gaming. They have done a great job in meeting the needs of that really important, most demanding consumer and commercial buyer and getting them to pay up a premium for incremental features. These things can be relatively small, like integrated privacy screens, integrative skype calling, and highquality build. I think hewlettpackard can continue to gain share. Now, the pc market, we expect that to be nominally a flat market going forward. Emily meg whitman is no longer the ceo of hpe. She has gone on to her next endeavor. Neri, the new ceo, is speaking on the call, talking about the macro environment, saying he thinks he sees market improvement. But what is your outlook for hpe without meg whitman . Crawford i did have the opportunity to talk with antonio before he hopped on the call. He is really thrilled with the performance the company had in the quarter. I think of hpe we will see without meg whitman will run a similar playbook. Theyre looking for acquisition targets that are additive to the profit pools and participate in and are in growing segments, that fit within hps channel and in their direct sales force. Remember, 70 of hpes revenue comes from indirect sellers resellers. ,they have a vast network they can leverage. The key to this quarter is two fuld. Old. Wo f antonio is very clear about this. They have enabled hpe next, which took 1. 5 billion out of the company for this year, of which they invested 700 million back. They did huge costcutting while growing the top line. That is pretty impressive, not something any company will want to go through going forward. , but they set themselves up with a smaller overhead structure to now participate in larger areas of the enterprise market, like the intelligent edge with aruba, like hpc with silicon graphics. They are seeing the benefit of companies repatriating cash, operating in a lower tax environment. They are seeing Infrastructure Spending ramp up. I think you will see that at Companies Like hpe. You saw it at cisco. The company has to upgrade there their infrastructure. Not everything has moved to the cloud. Emily tax reform already a big topic on these conference calls. How do you think tax reform will impact both of these companies . Crawford they are both telegraphing lower tax rates. In both cases, somewhere in the mid teens range, down from the low 20s historically. They are not mentioning absolute dollar amounts, but you look at hpe, they are talking about returning 7 billion to shareholders. That will come to some degree, probably to a very large degree, from offshore cash that they bring back. As well, they are talking about, in the case of hpi, beyond the executives participating in their incentive plan, in hpes case, they are talking about decreasing the 401 k match and having employees participate in different bonus pools associated with them bringing this money back. Again, in general, they are trying to acknowledge it is a favorable environment from a tax standpoint. It is also a favorable environment from a demand standpoint. You have to strike while the iron is hot. For the first time in a long time, hpe has the ability to execute and the products to take advantage. Again, a place they have not been in the past few years with divestments and whatnot. Emily on that note, the cloud is rapidly expanding, but still hotly contested. How wellpositioned is hpe to compete in the cloud or hybrid cloud future that meg whitman talked about . Crawford hpe was very clear that, in this tier one data center business, they dont view it as a very high calorie business. It was not a significant margin pool to them. And they decommitted to that business. That part of their server business is an area where you will not see hpe selling a lot of service to amazon or google servers to amazon or google based on the strategy now. They are participating in the cloud in a number of ways. They are selling hybrid i. T. , selling gear to enterprises that will have a mix of on premise and cloudbased offerings. They are also selling enterprise gear to a number of fast providers that will use that year to host to their own cloud platforms. This is back to that 70 of their revenue that goes to be esellers. There are many thousands of Service Providers around the world that hewlettpackard enterprise, who will host amazon and microsoft. There are multiple ways for hpe to participate, but not in the tier one suppliers. Quite frankly, they could not make any money doing it. Emily thank you so much. We will keep listening to these calls. A Stock Plunged over 50 in the trading session investors , dropped the stock after the maker of angry birds missed estimates in its latest earnings results. One analyst calls it a huge disappointment. Coming up, elon musk Just Launched his fourth rocket this year, this time filled with three satellites. Why the tech giant wants in on broadband next. And if you like bloomberg news, listen on the radio, the Bloomberg Radio app, at bloomberg. Com. This is bloomberg. The Trump Administration wants to cut the red tape for space entrepreneurs. They discussed ways to revamp u. S. Rules pertaining to the commercial use of space. Among the recommendations being considered, a single license for all space launches and reentries, regardless of the location and type of vehicle being flown. The goal is to streamline and and approval process that has been resized as overly cumbersome in an era when a new cast of space players are developing ambitious plans for new space enterprises. Some of the high profile players include spacex, Virgin Galactic see nevada, and blue origin. The Record Company jeff bezos launched nearly 20 years ago. Trump revived the Space Council last june and directed Vice President mike pence to lead it. This week, the council also announced a 29person Users Advisory Group to foster greater cooperation and coordination among government and private space players. You can find me on twitter and follow tictoc on twitter as well for all your news. Emily sticking with space spacex rocket carrying three satellites were ordered into space today from the california coast. They carried in imaging satellite and two smaller satellites. It aims to provide Internet Access to the more remote corners of the globe. Space angels is the leading source of capital for space startups. We talked a couple weeks ago with the last launch. These now are becoming routine, but are really important when it comes to moving Forward Space technology. What is significant about this particular launch . Chad thats exactly right. This particular launch is exciting for a few reasons. One, it carried two of the test satellites for the new mega constellation. It will have 4000 plus delivering communications to the earth. This is important for a few reasons. It will connect the other 3 one, billion, as you mentioned. It will give people options to their current cable providers. Most separately, spacex is still going to mars. This will be a key piece in their financial architecture that will get them there. Emily talking about this effort fasternternet Internet Access to the farther corners of the world, it is something other internet entrepreneurs have shied away from, like Mark Zuckerberg and google. How is what elon musk is doing different . Chad satellites provide an alternative, a way to deliver these Communication Services that go beyond the uabbased and balloonbased that we have seen previously. Typically, these Communications Satellites are in geostationary orbit. That is very high up over a particular point on earth. These 4000 satellites will be much closer to the earth, which gives you a smaller distance that the signal needs to carry. W learnings in progress when it comes to rocket reusability. What did we see happen here today . Chad this is very cool to see. Spacex just continues to push boundaries and keep us all interested. Even in the shuttle and apollo years, we saw viewership start to fall off. Thats because people want to see what is coming next, what progress we are making and what are we doing next. Spacex continues to push the envelope. Today, the payload, the satellites, came back to earth and they attempted to catch them with a giant net on a boat. While they missed, they came really close. It seems they have a good plan to catch it next time. Emily you are also at the national Space Council meeting. I know they talked about space entrepreneurship and there is a move towards future space travel as a commercial rather than a government endeavor. What kind of progress are you seeing . Chad that is exactly right. It was good to be in the room yesterday, to hear the conversation. It is really good to hear the emphasis on streamlining regulation and licensing. They have moved a lot of Space Operations and space oversight into the department of commerce, which is another key signal that the future of space is commercial. The overarching focus in that meeting was really about space entrepreneurship and how the government can continue to partner with them as a customer of Services Rather than a benefactor or funding the development of new systems. Emily what is the mood given the messaging coming from President Trump about turning space into the next freemarket paradise . Chad we certainly have been working towards that the last two years. So its good to hear the government getting on board with that message. I think the data is starting to back up the story here in a major way. We have reached the Tipping Point where the government has started to sit up and pay attention. Emily we talked about this in the past, but as space becomes more commercial, what are the safety concerns, the regulatory concerns that you expect to see pop up . There is a great one with the spacex launch today we can talk about. Theyve got three key challenges. One is the fcc licenses for spectrum. It is a scarce resource and how you send radio down to earth and how you bring this unprecedented amount of data back down to earth. And then also, how do you navigate the ever increasingly crowded highways in space . Space is very big, but a lot of the key orbits are in demand. How do you monitor all of these things . They provide a lot of opportunities for startups. We are seeing startups addressing each one of these concerns with Laser Communications to bypass the radio frequency spectrum, new ground stations that are allowing you to steer them electronically. You can do them for much smaller and much less upfront costs. And in debris tracking, we see Companies Come in and do this in a way we have not seen before and at a cost point we have not seen before, being able to track two centimeter objects. And give us a lot more Situational Awareness in space. Chad anderson, space angels ceo, thank you so much for breaking it down for us and talking about what is important. Robin hoods 4 million users can start trading bitcoin commissionfree today. The californiabased firm is offering the service in california, massachusetts, new hampshire. Robin hood hopes to offer cryptocurrency trading in most states by midyear. Apple is seeking to bolster its wearable business, its popular headphones. This is bloomberg. Emily apple is seeking to bolster its wearable products. The tech giant working on upgrades to their headphones. An upgrade could be released this year. Next year there could be a version that is water resistant. Joining us now mark gurman who brought us the scoop. What are the new features going to be . Thank you for having me. So exciting, air pods, people are liking them. They are becoming a secret smash hit for apple. Two versions, one with deeper siri integration. You can put them in your ears and peoples siri, phones will go off. I think i just heard yours go off. [laughter] emily it is going off. That functionality will be there. Mark there will be a water resistant model coming about a year after in 2019. Emily has the issue of charging these headphones become a problem for users . Mark that is a good question. I notice the battery life is not exactly the five hours that you get. People on the long run will have to recharge. But in daytoday use, if i am in the office and i just want to listen to music for 30 minutes at a time, i can see it lasting the whole week. It varies by use case. Emily what makes them such a hit . Mark i think it is the charging case on the wireless capabilities and the convenience. I always have mine in my pocket. It is very good for taking a phone call, if you want to step outside, take a call in the office. It doesnt really have the need to put wires in and out of your phone or your ears. There is a convenience factor definitely there. Emily there was a time when the wait was weeks. How are they doing on supply . Mark that is another under told story. It took them a while to reach a demandsupply balance. In terms of demand for it, doesnt mean there were so many more people buying these things than apple expected . Where they harder to figure out . Thanks for the extra work. These days, you can pretty much walk into any apple store and best buy and buy one. Emily they are not cheap, but they are not the highest ticket item in apple store. How much money do they actually make on the air pods . Mark that is a good question, they are a key component of this other product division, which incorporates the home pod, the apple tv, the stylus, a few other accessories. That division also has wearables within its, which includes the apple watch and air pods. The cfo of apple told us on the Earnings Call that that part of the division grew 70 year over year. Clearly, the air pods with the apple watch are making an impact on their bottom line, which is why we are following this category closely. Emily given the upcoming iphone launch later this year, how are the new air pods going to interact with the new phone . Mark it is joining the story where they like to update individual product lines. Now we are seeing their pods becoming part of that update cycle. Importantlearly more than people thought they would be. Emily thank you as always for that scoop. Coming up, we explore the Investment Strategy between behind citigroup capital arm and how they want to shake up the startup world. Bloomberg technology is Live Streaming on twitter. This is bloomberg. Retail. Under pressure like never before. And its connected technology thats moving companies forward fast. Ecommerce. Real time inventory. Virtual changing rooms. Thats why retailers rely on comcast business to deliver consistent Network Speed across multiple locations. Every corporate office, warehouse and store near or far covered. Leaving every competitor, threat and challenge outmaneuvered. Comcast business outmaneuver. Show me the olympic winter games leaving every competitor, threat and challenge outmaneuvered. Like ive never seen before. Xfinity x1, yeah, i always know the scor. Triple corks in 4k. Lookin so sick. Stream live on every screen, every win, every trick. 2000 hours of coverage, get your mind blown. 50 olympic channels, yup, youre in the zone. And if theres something that you want to see, pick up that voice remote and just say show me. Experience nbcuniversals coverage of the olympic winter games like never before with xfinity. Proud partner of team usa. Hello and welcome back. It is 12 30 here in hong kong. Inflation stalling. Ofjapan, a key gauge inflation unchanged, 0. 9 . 10 higher t