Point of earnings season. A good start. Earnings beat for microsoft, despite falling pc sales and once again, its all about the cloud. Amazon reports strong sales growth. Who cares about margins. Customers dont blink at a price hike for prime. Drum beat of new services continues. Analyst notes this morning are pressuring the stocks. Starbucks up, earnings as analysts expected. Exclusive with Howard Schultz ceo and chairman coming up, coffee, Digital Payments and why lunch is next. Ford is slipping despite strong sales. Profit did miss analyst estimates. Fords margins hit by higher production costs. Shares are dropping. Well hear from bob shanks. First up, microsoft did Beat Estimates by a nickel, fiscal had thirdquarter profit of 68 cents a share. Company was helped by momentum in Cloud Services as total commercial cloud revenue more than doubled in the period and last night during his first earnings call, nadella spoke about betting on the cloud. We will continue to invest in our cloud capabilities including office 365 and fast growing cloud market the. Were committed to ensure our Cloud Services available across all platforms that people use. Were delivering a cloud for everyone on every device. He said the words first, mobile first, cloud first seven times. Seven cloud references to four windows references. This is a windows purge call. You do not hear windows unless you can they try to avoid it. Its almost as if hes rebranding the company right here right now. And windows is just something they dont want to talk about. Theyll make plenty of money with it but theyre a cloudbased company. Its like a stalinist purge. Getting rid of stalin and his name is windows. Enterprise software up 7, consumer revenue up 12, surface revenue up 50. I mean theyve got some engines, some pots boiling here. I have a statistic that i happen to be very i was going to say fond of. I happen to like amy hood, the cfo, who was marginalized on the call. She said she wanted more. Xbox 1 sold over 5 Million Units since launch. Engagement has been high. A scary fact about our country but also great for microsoft. Users spending near ly five hous per day on the console. How many call of duty what do you do . Do people work in this country . The average age of a gamer is like 40 years old. Not talking kids. This is i think its a strange fact for our country and very good for the cloud soft. Microsoft. Wow. Im actually taking that in. Five hours, average age 40. We know from zuckerberg that theyre on facebook for five hours. Just wait until they get the oculus glasses. Thats it. Youre talking about 10 1 2 hours a day then going 12 hours. Just going to be fully immersed in whatever youre doing. But how about like making, you know, a living . How about how do you put food on the table with 5 1 2 hours of gaming and 5 hours of facebooking . Lets talk about the nokia acquisition, its closing any day now. Today . Yeah. I think today. And, you know, theres a lot of shareholders there who would love and some ways i think to see nadella to say we bought it now were selling it or just going to take a huge writeoff and move off and not spend a lot of management time on this. Does not seem to be the case. 30,000 employees. I dont know. We dont know. We dont know. I got to tell you that would be bold and that would be a i mean how do you walk into the board room and face in balmer and go sorry . Amy hood has said over and over again, bold decisions, bold decisions. I think that Means Nothing is off the table. How would you receive, as if they were to do that, say you know what, forget nokia. This guy really is breaking with the past. He has got nothing, he is really saying, listen, steve, love you, its a new company and were not going to be wedded. He is seen as this agent of change but the office move to the ipad came in before he took the helm, but he is sort of being given that halo. Isnt it funny tim cook chose to highlight the fact that microsoft is on ipad, but microsoft didnt highlight that. Make of that. Right. I think they could make a this could be a new broom sweeps clean. I think everything is on the table frankly. I think thats why amy hood keeps using the term bold. What would be the boldest thing in the world to do . Break up the company and say nokia, it was great but wow. That would be something. Doesnt sound like youre willing to take a fly on the shares based on that hold dynamic. I think the breakup value is terrific. I do like theyre not going to break the company up. All right. Some of the parts. Sort of dis miss nokia more than breaking the company up. Steve ballmer who remember flirted with alan mulally for kind of a nuts and bolts guy, steves father worked at ford, the first time even multiple cloud references, but sat ya uses the term ambient intelligence, ive never heard of that but i feel more intelligent and ambient. Just when you say it. I feel more ambient. I thought that was something you do with esigs. Look at that shirt. Just miss that. Twotrick pony. He called himself that. Move on to amazon it was up after hours, reporting 23 jump in First Quarter revenue. That was a big number beating street expectations. Earnings in line with consensus. They had come down. Analysts had come down. Operating expenses up 23 . Amazon well spending heavily on what else, shipping, cloud, computing, new hardware such as its fire tv set top box. Amazon forecasting that it will lose money for the Current Quarter. Free cash flow which i like to look at. 1. 49, lets call it 1. 5 billion for the quarter, 1. 5 billion for the year. Do a multiple to Free Cash Flow there. Still talking 30 times, 30 times. Maybe a little less than 30 times. This Current Quarter and the guidance doesnt seem to be that friendly, perhaps, to some of the analysts that follow the company. While we saw the stock up 5, 6 after the numbers, this morning it is coming in. I think theres a revulsion against growth and the analysts trying to get ahead of it. Raymond james goes strong by the buy, citi lowers price target, wells cuts price target, deutsch bank cuts price target. I think people are saying we saw what happened the other day with facebook where they shot the lights out and nobody liked it. Were going to get ahead of this, i think the stock these guys went kind of just said were done with this Company Spending for Growth Opportunity so big we dont need to show a profit. In the meantime in the Conference Call, theres multiple references to china and every single time its mentioned, the cfo says, were going to be investing heavily. Now these are now investing heavily has become a sin. Thats but thats what amazon does. They dont care. No one likes it now. No but they they dont care. Bezos doesnt care. By the way, return on invested capital thats what he cares about. He does. Take a look at that. We put that together. Looking through the slides this morning. Thats what he cares about. Thats important to him. If he can show that and say look what were doing here, were investing our capital wisely overall for a return, thank you, shareholders, stay with me and they do. They stay with him. I think after the growth, the growth to value has finally reached its course, people will come back to this. I do want them to dominate china. I do want them to give you 45 pounds worth of goods. I do want them to take it to fedex and ups. I like the idea that spain, italy are doing terrifically. The kindle fire, i want to get one of these killer product your point about patience, right, investor patience, an analyst report, im not sure which one, that has sigh in the title because this will become weary over time if it continues. People i liked the bernstein fella, amazon units, because the units continue to slow, trying to say dont worry about it, forget about it, hang with the stock. The analysts are all trying to back away because the analysts are saying, hey your know what, maybe my time of riding this growth off i find they got 23 Revenue Growth still. I mean thats where margins higher. Thats where, you know, the bill millers of the world are going to point you to that number. Im reporting the news here. Im not giving you comment. Im reporting the news. And the software as a disservice stocks, did you notice that . I did. Disservice stocks, the Growth Stocks. I had now on last night,now, they did plus 60 growth and the stock, the stock got killed. This service now is the Fastest Growing in the software and disservice category and so people are backing away. I think theyll come back. But right now, theyd rather have 12 times earnings of microsoft than they would have 40 times whatever. Right. Well, its an infinite multiple sometimes on amazon where with facebook its not at all and yet well doesnt matter. People saw that. Look, facebook and gilead changed the equation. No one is going to do as good numbers as gilead and biotech and the growth of profit that facebook had. If thats the reaction, its like, you know, lets go buy caterpillar. Maybe in the face of yellen and whats going on there, thats the only thing i can come back to. Ukraine. Maybe ukraine. We have to talk ukraine. Bigger picture of the fed maybe, maybe, slowing, pulling back. Visa. Starbucks. Fiscal secondquarter profit 56 , and also raising guidance for the full year. We are going to talk to Howard Schultz this hour about that and a number of other issues. Raising their guidance. Wouldnt comment on soda, although im sure well try to give that another go. Yeah. I do think it was great to not hear the weather disrupted the quarter even though they had many stores that closed. As a matter of fact, as the quarter went on, it got stronger. I think that thats terrific. This is now theyve said listen, were done testing. Beer and wine. Its going to happen. They said well go there at night now. Europe the strongest its been in 14 quarter, 16 growth. Promised it on the show. Howards moved into social mobile. Theyre talking about this being monetized and sounds like monetized this year. This was the best call last night. Yeah. Potentially licensing their mobile payment platform would be a huge new play. As starbucks sending visa desce descends. Whats up with that. 100 million kalgs in russia. This Conference Call was amazing. Guided down on every level. They did say dont worry about it. This was the first call that made me think if youre not focused on ukraine youre crazy. Russia is talking about basically cutting them out. They actually talk about that. That russia is saying listen, you may have to put all of your business in russia, which is really a word on russia and ukraine. We have seen a drop off in crossborder volume and then theyre talking about the idea of Transaction Processing going away in russia . The russians may kick them out. Its also a factor in the ford call today or the ford results having to idle production in that country. This is russia is a major, major negative all of a sudden. And youre talking about a Competitive National payment scheme. You know what that sounds like to me . Venezuela. How many times do you see colegate today, charge venezuela. In fairness to visa, its in influx, we dont know, whatever. I tell you it took my breath away. I didnt know it was that big the russia. Now i know. Now you do. Holy cow. Were going to talk to Howard Schultz in a little bit. An exclusive with the ceo of nike, mark parker, whose company has been in the spotlight this week because of wearable tech of course. But up next as we said, ford shares off to a rough start. The automaker messy quarter and earnings miss. Well break that down for you. Futures are relatively weak. S p has been the a tight range this week. 1. 4 for the week and the average for the year, is 2. 4 . More squawk on the street from post nine in a minute. E in a mis at your ford dealer think . They think about tires. And what theyve been through lately. Polar vortexes, road construction, and gaping potholes. So with all that behind you, you might want to make sure youre safe and in control. Ford technicians are ready to find the right tires for your vehicle. Get up to 120 in mailin rebates on four select tires when you use the Ford Service Credit card at the big tire event. See what the ford experts think about your tires. At your ford dealer. Make it happen with fidelity active trader pro. Its one more innovative reason serious investors are choosing fidelity. Call or click to open your fidelity account today. Happy birthday. Ford reporting quarterly profit 25 cents a share, missing estimates. Automotive revenue fell short of expectations. Ford high looising a number of onetime factors like weather, currency, warranty costs impacting its results. Phil lebeau will have an interview with Robert Shanks later in the show. Europes loss does shrink, but you have south american devaluation, higher shipping costs because of weather, difficult quarter. I look at it, though, the loss is cut 50 in europe. Europe a black hole. Talking about being solidly profitable in europe next year. China has gone from nothing to a tremendous asia, tremendous profit contributor. U. S. , i dont know, they decided weaker beginning of the quarter but they said theyre going to spend they said theyre going to earn. 8. Theyre going to do that. They invested a lot. They have 23 new launches and theyre basically doing what you want a company to do which is invest a lot. Theyre going to be really big its a 2015 story, no the a 2014 story. Not worried about share losses in north america . I didnt think it was that bad. My travel trust owns gm. Gm had a better quarter than ford frankly and you know what, doesnt matter. Gm is cursed because of the headlines. Yeah. It doesnt matter . The stock actually i thought had it opened shown a little life. Opened at 34. 30 and then dropped down to 33 and change and still guys downgrading it. Look, i think fords okay. Did they blow you want to see in the big cycles in the 90 cycle for the autos you got those numbers that were so big like giving you these gigantic dividends. Yield 3 , gm yields 3 will keep the stocks from getting hammered. Yesterday we were talking to ann on cat. She thinks south america and brazil will be a bigger headwind in the future. Ford cut their outlook on south america. South america is bad. Other than colegate despite the world cup and olympics, that economy given what it was five years ago and everybody saying about it. Blown opportunity. Just crazy. When you look at the shortfalls for the Oil Service Companies its because petra is not spending money, valet won a gigantic decision, against brazil. Everything is going wrong and you got the the big spend on the stadiums. Venezuela, supposed to have gotten better after chavez, has gotten worse. Argentina cloy sterred. Latin america is bad. Thank heaven for colegate picking up good numbers there. Well try to get to those later on. Cramers mad dash as we countdown to the opening bell. Well talk about coffee, tea and profits with the chairman and ceo of starbucks, Howard Schultz. Thats coming up this hour. Take one more look at the premarket and get the final opening bell of the week in about 11 minutes. Out 11 minuteso mission a for a final go. 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But shes still gonna give me a heart attack. Thats health in numbers. Unitedhealthcare. Its friday, baby. We got about eight minutes before the opening bell. A mad dash time. Plug power we talked about a number of times. Youre a gluten for punishment. Plug power and the stocks represent the most speculative part of the speculative market we have. Take a look, this has been a pretty good performer, hasnt it . Only up 260 year to date. Penny stock, penny stocks usually dont come back. Penny stock, imagine this, david, within a few months of being a penny stock, Morgan Stanley does a 22. 6 million secondary. The stock was at 6, coming at 550. Why is this important . This is Hydrogen Fuel cells, highly speculative. I think the speculative part of the market has gotten hideous. Watch this deal. We could be in for a little more rough sledding. Highly speculative. Its always been, you know, a bridesmaid, never a bride. Walmart everyone thinks this is it for fuel cells. Its coming. Its coming. Its coming. Still coming like those russians. Exactly. Not the max. Wait until next year. You dont have to. Now well see about that. The one stock that is allowed to spend all at once and gets rewarded for it is buydo. Stock up 15s last night, come back in. Always implications for alibaba and yahoo . Ive been hearing alibaba could be worth upwards of 200 billion. We should be getting an s 1, week and a half ago i said two weeks, that is probably right. Perhaps see next week. Very soon the s 1, we wont see alibaba until late summer, early fall. Really . I was going to say it would happen before yahoo reported its next quarter. No. What you will see in the s or f 1 actually a foreign filer, is information about alibabas i think it would be their their last quarter of last year. It will get updated as you go along. We will be looking there to get information on alibaba and then turn back to yahoo china is this market is rewarding Chinese Companies with fabulous growth. We got to stay on that. Theres a lot of