first-quarter sales and profit that topped analyst estimates. they received new orders for servers that run data centers. they may be picking up the orders as ibm leaves by selling its unit to lenovo. fourth quarter revenue at groupon exceeded estimates. priceline reported profit for the fourth quarter that topped analyst estimates. the economic recovery in europe helping to lift hotel bookings. the bet against herbalife has become the biggest loser for bill ackman's loser since its inception. >> peter will stick around. first let's get insight into these tech results from paul kedrosky. he joins us from san diego. paul, we had a bunch of tech earnings out after the closing bell. let's start with hewlett-packard. not seeing much reaction. your take on the quarter? >> there was a little bump higher on the headline, and that it weakened since. the current quarter was better than expected. look ahead in terms of guidance, it is a little light on the earnings side. that is all market technical stuff. the deeper story has to be how well the transformation of the company is going. away from being reliant on traditional products and certainly on the desktop front, moving towards servers and 3-d printers and things like this. that is going, but it is a long, painful transition. it is still early days. the numbers suggest it will be four or five quarters, not one or two. this one is still very messy. >> how do you think meg whitman is doing? she is three years in working on this turnaround of hewlett-packard. an earlier guest said he would give her an a-minus. >> i think she is in an impossible position. a-minus is all you can say. there is no a-plus here. >> that is part of the problem. it is a huge company. not so easy to just turn it around. >> it is not. even more importantly, people forget, and it is easy for the markets to forget, that we are transitioning over to a server-based company implies there is a market to go to. that itself is imploding as things are moving to the cloud. you are trying to transition the company into a market that is its self in transition. that is going to be very hard. >> let's talk about groupon. we have seen share reaction, the share price moving lower as a result of groupon -- you laugh, is it comes to groupon? >> groupon is a circus, right? a very entertaining sideshow. the stock was up 15% on the had lines and then people read through the release and discovered things are not going as swimmingly as the headline may have implied. now it is down 11%. a 24% swing after hours, that is out of some kind of comic book. truly unusual. the real story here is twofold. one, the transition from a desktop e-mail products to a mobile product, which is underway. the deeper one is the transition from being a daily deal company to more of a persistent provider of discounts. that is the more complex transition. that is the one that will be much lower than expected. the mobile transition will be much easier to pull off. >> one more for you. priceline coming out with results after the close. what do you think? >> i think that is a much more impressive story. it is underestimated consistently. this is a hugely strong european story. it was thought of as some kind of strange william shatner-driven play domestically. the story is really about the dominance of european discount travel, which continues. >> before you go, we have a headline that mentions that microsoft was in the talks for whatsapp. your take on that? >> at this point we have to assume this was a very competitive auction. we know google was in there two weeks ago. now microsoft. my expectation is that what happened was facebook came in and said, i have to trump everybody and put in this giant offer 40% above where anyone else was to close the auction off. facebook put a lot of paper in to make it happen. >> time will tell if the purchase price make sense. thanks so much for the rundown. paul kedrosky, managing partner at sk ventures. we turn to the international scene. something that has been on our minds, unrest in the ukraine. continuing, with the death toll rising to at least 75 people. joining us now on the phone from the ukraine is hellmuth tromm, a managing editor of bloomberg news. also still with us is peter cook. where are we now? we thought we had a truce 24 hours ago. that didn't work out. we continue to see turmoil, continue to see death. assess the situation for us. >> the focus at the moment is on the mission the european union foreign ministers are having here with yanukovych. as we speak, they are sitting down again with yanukovych, other foreign ministers from germany, poland, and france. the latest word is the leaders of the opposition have joined that meeting. they already talked for almost six hours this afternoon trying to convince him to accept a deal according to which there would be early elections sometime towards the end of the year. and that they would pull back the security forces from independence square. >> peter, i want to bring you win to this conversation. >> this is all being watched at the white house very carefully. you have an administration right now dealing with a whole range of foreign-policy crises. syria, the situation with iran, middle east peace talks, and ukraine at the same time, once again involving russia. very few options, very you things in the toolbox for the president to use right now. you have some pretty tough rhetoric that got ratcheted up in the last 24 hours. last night you had the move by the administration to put a travel ban in place on certain government officials, civilian officials in the government of the ukraine. we don't know exactly who. they did not identify them by name. now you have the eu, canada moving to freeze assets of some individuals in the ukraine. the next question is, will the u.s. soon follow on that front? all we got was the sense that the white house is looking at a range of options out there and they sense some urgency out here, given the situation on the ground. any sense from the white house that in terms of escalation of what we are seeing in the ukraine, that this is unexpected, that they did not expected to unwind as quickly as it has? >> i think, like everyone else, they saw the truce last night and were hopeful that that would amount to something. but obviously that petered out. i don't think it was a great deal of expectation it would hold. but they are counting on the european union. there are folks on the ground in the ukraine to try to craft some kind of at least a temporary situation that at least reduces the violence and get the sides to the negotiating table. that would be the best-case scenario for the united states. there was some tension a few weeks ago between the american diplomats and the european union. on this point, the eu and the u.s. are basically on the same page. >> let me go back to hellmuth tromm, who joins us from kiev. you are out on the streets. what is the environment like? what is the mood like? >> it is kind of a bizarre situation. we are less than a mile away from independence square. right here, you couldn't tell anything special is going on. but on independence square people are digging in. they have fortified the barricades throughout the day. fires are burning. everyone you talk to on the square will tell you, we are not turning back, this is a one-way street for us. we will stay here and either we will win this battle or it is all over. >> are you feeling pressure from outside? are folks on the ground in kiev feeling pressure from outside forces, whether from the united states or russia? >> well, i think people have somehow lost a little faith in diplomacy. the situation has continued for so long. their demand is yanukovych has to leave. at least he has to give into early elections. they have seen so much talk, and nothing has happened. i think they are not having very high hopes at this point in terms of diplomacy. this is why things turned is so violent. >> thank you so much for the update. hellmuth tromm, managing editor at bloomberg news, joining us from kiev. and chief washington correspondent peter cook. our next guest wants to take some of the financial pain out of dealing with insurance companies rolling a car accident. he are ready handles a quarter of the world's auto claims. this is "taking stock." ♪ >> perhaps the most fascinating aspect of successful entrepreneurs are their humble starts. mark zuckerberg started facebook in his dorm room. elon musk taught himself programming at the age of 12. our next guest went from hanging out in his uncle's auto garage to founding a company focused on modernizing the insurance industry. good to have you on "taking stock." you have done four other companies, created them and sold them. what guides you? >> well, i worked primarily in the automotive industry. that is my passion. i think what guides most of us is our passion for improving things or inventing things and trying to get people to see a different way. giving them an opportunity to use it in a massive scale and finding solutions. >> you grew up around cars big-time. >> i love cars. my wife could send me out for a gallon of milk, and i would come back with a new car. >> we have been focusing a lot, we mentioned cars a lot on tesla motors this week, what do you think elon musk is doing in the electric car universe? >> the industry, the automotive industry needs entrepreneurs who are small and agile. so that they can do things that the big guys can't. big car manufacturers are doing a great job with many things, but sometimes you need disruptive forces to make a big industry think big. >> like your company, solera. >> it was started in a garage, like most entrepreneurs. >> what we are doing in solera, i started my career sweeping floors in my uncle's body shop. back then estimates were written on paper. a coveted process, and active negotiation. we had a passion, me and our associates, a passion to digitize this and make it intuitive. information should be at the fingertips for anybody, whether it be the consumer, insurance, the shop. we brought an intelligent system that doesn't make mistakes, that is very accurate. that brings the right parts together, the right prices, everything in a matter of seconds what used to take sometimes days. >> is it having all the information in one place? >> it used to be all books and phone calls. that was the beginning. you kind of bring it all together in a digital format, and after that you start thinking of ways to make it intuitive. to make it interactive, customer-centric. just like the evolution of all technologies. >> where do you want to go with this? you have sold your past companies. >> this was the first one i took public. most of the days i'm really happy about that. >> depending on which way the market is going. >> we are in 68 countries today. growing to 100 countries. we handle about 20% of the 100 million claims. the cool part of our industry is half the world, half of the 100 million claims, are still done on paper. we have a huge opportunity to digitize that. we want to bring a digital lifestyle to the automotives, so people like yourself can have all the knowledge, whether it be service, maintenance, collision repair, you can be as knowledgeable as the most knowledgeable person. the google at your fingertips for automotive repair. >> like how you can find some much information online when you buy a car. >> after you buy it, all the care activities. >> interesting stuff. thank you so much. tony aquila, the head of solera holdings. our next guest could be the mark zuckerberg of publishing. at 21, she started a global magazine. continuing right after this break. ♪ >> over the next few months, we will feature a series called "small to big," how small companies are tackling big problems. we spoke to a magazine company's ceo. >> we are the world's leading publishing platform that enables readers globally to digitally read newspapers, catalogs, magazines. a magazine dedicated to women drummers. one of the big challenges we face is how to make sure that the world knows about us. it is not something you can immediately overcome with pr. it is about making sure we are doing a number of things that get content in front of people. one of the things we recently introduced is called "stacks," where they can create stacks of content they like. my kids are gluten-free, so they had one with gluten-free recipes. i can see who else is reading it. when you are finding people who share your passion and interest, it creates more comfort. it makes the world a smaller place. we are now north of 80 million people coming to read issuu content every month. absolutely we expect to be in the hundreds of millions over the next two years. watch this space. >> our next guest is on the smaller side of things, but growing rapidly. founder of suitcase magazine. she founded it as a junior at nyu two years ago. she has since graduated and is in london, where the magazine sees 20,000 online visitors a month. thanks for staying up for us. we appreciate it. talk about the struggles of running a small business -- >> i think one of the biggest problems or biggest challenges for a smaller magazine is getting people to recognize our worth. just because quantity does not equal quality for us. having people realize that is a bit of a challenge. >> so much of what you do -- and i was looking at your site, you have stuff on travel, fashion, lifestyle, shopping -- is how you differentiate yourself. there is so much content out there. how do you do it? how do you differentiate yourself from so many choices out there? >> we are the first travel and fashion magazine for young people. we make sure that because we are print, that we have spent the hours we don't want you to spend, finding places for you to go to and curating content. that has high artistic value that you will have on your shelf for years and years to come. >> we just did a package on issuu. how do you get their attention to look at what you are doing so you were included? >> we actually put our second issue on issuu. we found the format was not quite right for us. we chose a print magazine after months of deliberation because we are a more artistic product moving in that direction. what we use for our online form, we have our website, which has much more immediate, quicker to access action. soon we will have a tablet, that will be the coming together of those platforms. >> we certainly wish you luck. this is what you did in just two years. it will be interesting what you do in the next two years. joining us from london. coming up, lifetime knocking it out of the ballpark with its melodrama, "flowers in the attic." this is "taking stock." ♪ >> this is "taking stock." today's market moving headlines. let's head back to peter cook. >> jobless claims in the united states fell last week. an indication employers held back on hiring even as cold weather slowed industries. walmart posted profits that trailed estimates. they are set to expand lower-format locations. they say struggles to keep shelves stocked weight on sales. five new board directors at abercrombie. investors have pushed for the company to put itself up for sale. >> another headline, something we have been watching closely, has been california. suffering some of the most severe droughts of its history. it is affecting many businesses throughout the state. erik schatzker has been traveling throughout the state to get a closer look. he joins us now from paso robles. what has been the most striking as you walk around? >> the most striking thing is quite simply the lack of water. you need to come to california to see how dry this place is. this is february. it is usually green in central and southern california. right now the state, at least this part, is brown. you will see very little green. the vines are dried up, but that is normal for this time of year. it is everything else not getting enough water. i came here to talk to these people about how the drought is affecting the wine business. the truth of the matter is other industries are affected throughout central and southern california. agriculture, farming, ranching. i want to show you what the state of the reservoirs -- this is where everything starts. california is a mountainous state. water collected in the form of snowfall on mountains and then is diverted to where is needed, whether it is drinking water or farmland. the reservoirs in many cases are at record-low levels. some in the teens, 15% of capacity. this is half of where they were in the last severe drought at this time in 1976. you get an idea for how bad the situation is when you go and visit a place like millerton lake. you can stand on the shoreline, where the water is supposed to be, and look hundreds of feet down to where the water is now. you get a visceral appreciation for just how little water there is in the state, and it is only going to get worse because in the sierras there is not enough snow. it has not been raining, has not been knowing, and cities like los angeles depend on the meltwater to the aqueduct system to get to los angeles so people can have water. not just to water their lawns and fill swimming pools, but to drink in the summer months. >> i have been reading about california's governor jerry brown, introducing some proposals for emergency legislation to help ease the drought they see throughout the state. why did we get to such a desperate situation? just the lack of rainfall, or why are we in this state right now? >> excellent question. you will get differing opinions. some people feel as though the water is being mismanaged, mis-diverted to places like the sacramento delta for the sake of endangered species of fish. the truth is this is a rainfall situation, mother nature at work. i will do better than explain to you. i want to play when asked up from a conversation i had with rusty gregory, ceo and chairman of mammoth mountain, a famous resort in the southern sierras, that caters mainly to los angeles. you will hear him talk about what it is like to operate mammoth in a bad year, and how this is really mother nature at work. >> the kind of year we have had the last couple years, they are good years in guest experience and the business in general. but in terms of financial results, the volatility that has come here because of the drought we have had in california has made it much more difficult. this year we are off what we would typically expect. about 25% revenue. that works down through the organization and makes it a challenge. to manage on a day-to-day basis. i am reminded every day that mother nature owns this place and we just rented. every time we think we understand what is going to happen that we run our projections and you are modeling and talk to our banks and my partners, mother nature does exactly what she wants to do and i have to do it all over again. >> i don't think i could put it any better. mother nature owns this place and we just rented. the same applies to all of us. as you can see, they do have snow but rusty's problem is they only have about half the snow they normally do at this time of year. with no prospect of further rainfall, nothing in the forecast for february and not necessarily much either, although that long-term forecasting is a little less certain, he may not have enough snow to extend the season long enough to recover revenue he told you he has a ready lost. >> a very difficult situation. thanks for the update. erik schatzker, out there in california. moving on to another story that caught our attention, the lifetime network recently hitting a home run, raking in 6.1 million viewers for the movie "flowers in the attic." starring powerhouse actresses, ellen burstyn and heather graham. lifetime has been switching up its programming strategy, and as a result is racking up ad revenue. it is all outlined in the latest issue of bloomberg "business week." joining us is a former a&e lifetime executive and now a professor of media at the university of southern california. also joining us is an online editor. what is going on with lifetime? women in distress, in prison, b or c-level actresses, but it is changing. >> you think of the typical viewer of lifetime as a middle-aged sad woman drink and chardonnay alone. but that is not what they are doing anymore. they are rebranding and trying to get younger viewers. they have been pretty successful doing this. they are trying to bring in more well-known actresses for their movies, lifetime original movies, which is the flagship series they do. and also make them look more beautiful, feel more modern. and in that way get the 30-something women to watch instead of just the 50-something women. >> we see it pay off when it comes to advertising. you want the advertisers. >> that is right. >> and i think that by doing this they actually are capturing the real advertisers that are going to the right demographic, which is the younger demographic. >> david, let me bring you in. you are a former lifetime executive. you know some of the executives in charge right now. you like what they're doing, the changes at lifetime? >> i have known these people for over a decade now, and they are masters at rebranding and reinventing networks. they did it with a&e, with the history channel. they understood that people don't watch networks. they watch programs. you have to deliver quality programming that gets people interested. progressing through this strategy where they have found a way to attract branded pre-salt titles like "bonnie and clyde," "steel magnolias," these movies, and have been able to secure audiences with the pre-salt factor in the titles. they still have a lot of the low-budget television movies lifetime has been known for still airing. >> it is the pre-salt factor that he is saying, the titles, the stories are well known by women already. what they are doing is appealing to the nostalgia of 30-something women. with "flowers in the attic," every 30-something woman read that when she was a young teen. christina ricci just start in a movie. >> i remember the original one with elizabeth montgomery. >> christina ricci means something to the younger viewers because she was kind of the contemporary. they are smart to get these actresses and these stories. people are tweeting about it, becoming big on social media. >> they're doing some original content. doing something that kind of makes fun of the women on "the bachelor." is it smart to move ahead on original programming? >> i think they're going to expand further in the reality area. this is bread-and-butter, where the highest return comes from and programming. i think you are starting to see across the dial a little bit of a burnout in the conventional reality form. so going more satirical, doing a mocking manner he, is a really interesting choice. at the same time you will see them ramp up the value of scripted dramas. they ordered a number of high-caliber talent-driven scripted dramas. i think they are operating on four cylinders. they really understand that you can't just look at it through one lens. >> that is a good point. the advertising community is definitely listening and liking what lifetime is doing. also this week, how the repetitive nature of digital ads can drive us all crazy. let's bring in our online editor. this is a story you really want to talk about. >> i have spent the last week watching the olympics online, which is great in a lot of ways. they have the technology where it was not four years ago, but they don't have many ads yet, you see the same two or three over and over again. >> it drives you crazy. >> the ads tend to be much more heartfelt and sentimental. by the end you feel irritated about these schmaltzy ads about olympic moms or polar bears. >> if you look at the tv world, it is kind of a nice variety. you go online, and nbc has whittled it down to who can do it online. you have done a lot of programming. is the online and tv world different when it comes to advertising, order the same rules apply in your view? >> behaviors are completely different. you have viewers watching these programs on mobile technologies, tablets, computers. i don't think they have the same kind of practices as viewers from your conventional sofa television viewers. i think there is a lower threshold for tolerance of repetition of ads. at the same time, they have become rather adept at being able to skip around the ads. so i don't know if they're getting quite the level of exposure that may be those of us who watch tv for other reasons get. i suspect most people don't even pay attention as much as we think they do. >> they are not the only ones doing this. whittling down how many advertisers there are online. >> a lot of sporting events streaming online have the same ads running over and over. some are not even sponsored yet, so what you get in the middle of a basketball game is just blank air with a very annoying jingle. tv companies are trying to figure out how to maximize advertising for online programming. it is not a science yet. also, you can fast-forward commercials anywhere. so are any of them really working? >> thank you so much. we are going to take a break. you are watching "taking stock." coming up next, there are a lot of options when it comes to purchasing a home. what you need to know. ♪ >> now to her series called "the paybook." we focus on how to best save for a home. \a home. our next guest says you should be prepared. christian thomas, residential sales director in manhattan's west village. good to have you here. we were kidding around in the newsroom that you have to make sure you have a job and steady income. that is number one. but there are a lot of costs that go into buying a house, aren't there? >> more so than most buyers are even aware of. it is really important to get a clear understanding on how to break costs down. >> things like the closing cost -- >> the closing cost, typically lenders look for 20% to 30% of the purchase price of the home. then you have your closing cost, and that can run anywhere from 2.5% of the home purchase all the way to upwards of 6%. >> and banks want to see you have money left over afterwards. not that you will be house-poor, as they call it. >> there are three components. the last component is post-closing costs. you want to have between six months to upwards of two years of carrying cost for your loan in the bank after you close. that is something banks look for. >> you have to really have a team together to do this. most people can't do it on their own. what do you need as part of your team? >> that is where we come in. the first part of your team, you want to interview a few real estate agents and find when you feel comfortable with. that is a really good place to start. the second component of your team is your real estate attorney. the third part is your mortgage bank or mortgage broker. it is really important that your team works together. it is important to form that team in the beginning. the process will be a lot smoother throughout the entire time. >> a lot of people also get preapproval from their mortgage banker or broker. good idea, in general? >> in this market is a must. i recommend doing that before you even go see your first property. you want to work with your mortgage banker, mortgage broker, to get that proof. your real estate broker can guide you. >> you see a lot more people doing a 15-year or 12-year when they buy their house. any advice? >> it is a really good question. there are two typical types of loans. the 30 year fixed-rate mortgage, where your payments are fixed for the entire term. then you have your adjustable rate mortgage, also known as the arm, where payments are fixed for 5, 7, or 10 years. those are a little riskier because if you are not worried about selling in that term or refinancing or even paying down the loan, your rate can go up after that term. the 30-year fixed is the more conservative route. >> but if you move into or three years, that might make sense for you. >> the good thing about arm's is the monthly payments are lower. >> thank you so much. coming up next, we will meet the founder of an irish whiskey company who is planning to bring the art of distilling back to dublin for the first time in decades. ♪ >> the business of making irish whiskey came to a halt in dublin in the 1970's when the last distillery shut its doors. whiskey production is coming back to the irish capital thanks to our next guest. the founder of the teeling whiskey company. great to have you. always a great way to end "taking stock," with a little whiskey. you have been in a family involved in the whiskey business for a long time. >> we have been traveling since 1782. >> state again? >> 1782. >> a long time. >> we are the eighth generation. we are trying to do things a little differently, but be respectful to the past and forge a new direction for irish whiskey. >> you had a business. >> my father set that up in 1987. at the time we were the first new distillery in 100 years. it was sold in 2012. >> to a company called beam. >> very good custodian for the brand. it gave me an opportunity to revive the teeling brand and do things differently. irish whiskey is growing tremendously, driven mainly by the u.s. there is room for smaller guys. >> you keep saying you are doing things differently. i got a chance to smell a little bit. smells pretty nice. what are you doing differently from the big guys? >> the big brands in irish whiskey -- for us there needs to be a lot of choice, flavors for people to discover. what we are doing in our small-batch offering, which we are launching in the first of april, we have multiplicity and we have it in rum barrels for six months the gives it an extra layer. it gives the smooth, sweet taste, but with other complexity and flavors to let people discover a new brand of irish whiskey. >> you have a lot of competition when it comes to whiskey. i hear what you are doing to differentiate yourself. how tough is it to get into a very established market? >> a lot of old brands and big companies that have big budgets. but for smaller guys like ourselves it is all about producing a high-quality product. we focus on the craft element that people are looking for today. >> about 20 seconds -- you have three products, what are they? >> small batch irish whiskey, single-grain irish whiskey, and 21-year-old single malt. they will all be available in the u.s. >> do you have a favorite? they're all your children, right? good luck. >> thank you very much. >> teeling irish whiskey. time for bloomberg "on the markets." we had a rally. the nasdaq up 0.7%. that does it for "taking stock." ♪

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