Sevenpart debt offer thats getting priced today its so true, carl. I think that word stabilization is really the key to the story here its signs of stabilization versus recovery and i think thats a key distinction and one playing out right now in the market whether youre looking at the ceo commentary on Earnings Calls or interviews on this network in recent days and the fed chairs message yesterday, arguably what were 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 weve seen right now and what weve 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 its the comments we got from facebook on that Earnings Call yesterday or alphabet or macys, 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 dont end up with the some big step backward in terms of infections and having to go into a second phase of lockdown another takeaway im getting from this earnings season is that a certain set of big Tech Companies, some of that includes what weve called the f. A. A. N. G. Stocks, but they have a lot of cash, theyre pretty dominant in their markets and have diversified portfolios of business, whether cloud, subscription revenue, et cetera, theyre 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 were 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 its 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 mcdonalds 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. Thats going to be the key question and its 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 governments 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. Thats important. In the nearer term weve 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 qualcomms 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, youve 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 thats 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 were 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 theres 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 im an oem and i think theres any chance i could still launch my phone this year, im going to be pushing you to deliver on time even if i dont think its a great chance im going to launch this year. Are you picking up a signal that theyre still hoping to launch this year but it might be a distant hope or can you be certain thats 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 theyre 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 its 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 its 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 its starting to come back are all price points coming back equally or more on the lower or higher end. Its broad. There are two trends one is that it responded or it came back much more quickly than we expected, meaning that its recovered very quickly it also the penetration level or the point that is now 5g is actually extended down i think its been a broadbased recovery and, you know, we hope thats the same thing in the rest of the world. Weve given our model for what we think will happen and we hope its helpful thats what were planning for as a company, we think the technologies of 5g be the trend of being connected more, thats the thing weve learned through this episode and we have to be prepared to take advantage of it. One thing that gives me pause is chinas 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, were obviously fairly far into the quarter and things like chip orders for us are well known and fairly firm its always an estimate in terms of what the licensees will actually sell in the quarter, but we have a pretty good sense on what thats 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 its also important to remember that the phone sales, depending on where it is in the world, has a different mix of online and offline, whether you have to come into a store or not theres a lot of variables to mix into it but this is our best view as to whats going to happen and its informed by not only chip orders but what our licensees are telling us steve, weve 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 youre 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 its a fairly theres a lot of cooperation that goes on, not just isolated to china theres always a theres a lot of, you know, cooperation as well as competition. But i dont see that as the narrative thats dominating the work flow. If you look today its 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 its probably a discussion at the parents level but at the kids level where we play, were 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 youre making decisions where your workforce is going to be located and how long how important are things like testing to that equation were 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 were 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 were working its 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 thats going to be the trend for a lot of places and we want to make sure were 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 weve had to over the last quarter. Im not sure the world is going to go back to what it was before and its probably going to use more and more of the technologies that were inventing and we need to be prepared for it. Youve 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 were 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. Ive 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 ive seen that just gives a look at the entire Technology Landscape im grateful for that. I wonder, what is it as a Business Leader and Technology Leader that you want to see, whether its from governments, whether its from other institutions that you think would help to lift all of us out of this situation as quickly as possible im talking in terms of whether its testing, whether its 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 dont have a lot of strategic, you know, uncertainty as to which way to go. You have to get through it, what youre 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 thats one of the more challenging aspects i dont have any great idea as to how to do that, but i think thats 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, microsofts head of gaming and president of xbox will join us in a few minutes dont 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 18778668555. Welcome back microsoft getting a boost this morning after a beat on the top and bottom line saying the covid19 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 alltime 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. Weve 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 weve hit nearly 90 million on xbox live, Subscription Services reach over 10 million subscribers its becoming a Strong Social fabric in the home at a time of need which im 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 broadbased 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 well see some moderation in certain things, but gaming already, prior to all of this, a third of the worlds population plays video games half the connected world, its nearly the Gaming Business is 200 billion globally, so its a big business already, and i think what youre finding and what were seeing now is people creating friends through their gaming experience, families playing in the home. Weve 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 im sure there will be some moderation, but i also think gaming activity, whether its in the house, the family together, or people playing online, is just going to continue to grow as it was before the c19 pandemic hey, phil, its 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 were 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 its an exciting year for us, were launching an xbox this year. It drives so much excitement on the teams