Died. Her publicist says she died with her husband and friends nearby. She was 80. Global news 24 hours a day, powered by more than 2600 reporters and analysts in more than 120 countries. I am alisa parenti. This is bloomberg. Caroline this is Bloomberg Technology. Up, the tech season heats up with qualcomm, at t, and even they are reporting or it result ahead as the dow clocks and above 20,000. Plus, cisco ceo tells us how its 3. 7 billion acquisition permeated the first major tech ipo of 2017. Finally, lucky money turns digital. With the help of . 10 messaging app we chat, we take you to chens and to show you how the chinese tech giant is gearing up for the Lunar New Year. First, to our lead the earnings parade continues at qualcomm, at t, ebay reporting results after the close. Qualcomm reporting sales that came in just shy of estimates, giving guidance it may miss sales and profit estimates in the current period. As you can see on the bloomberg trading, just slightly lower in afterhours trade. Im joined by cory johnson. These numbers, because glass halfempty it seems to the investor base. Cory numbers are in line with what the company has been giving us, diminishing returns. They had bigger growth as smartphones became bigger, but now that is saturated and replacement business, the growth is not there. Caroline one major key concern has been on every front, they are seeming to be attacked, whether it be competition or in some ways, the litigation they face to do with licensing. Any updates in that respect . They are facing antitrust challenges in south korea, which has been going on for a long time, and now in the u. S. This soup from apple. From apple,his suit the ceo talked about what he thought the relationship would be like with apple. We intend to remain a good supplier to apple even while the dispute continues and believe there is no better longterm partner for apple them qualcomm and our industryleading technology. We believe our strong and highly differentiated products will continue to be the foundation for our relationship and covers a broad range of technologies that will be fundamental to new products for years to come. That point, what we soften the company in terms of margins was pretty strong, 6. 9 . That maybe suggests apple sales were strong. Caroline and just time for the licensing is when it comes to profit, a major driver. Cory it is a fascinating Business Model they have exploited to terrific success where they create great designs for chips, let alone deal with the hassle of making them. Caroline they charge by the cost of the phone, not perhaps the cost of the chip. I want to look at ebay. It is jumping afterhours trading, up about 7 . Numbers dont look that phenomenal. We have seen numbers come in line. Fourthquarter forecast look to be hopeful. Cory it is about the analysts more than anything else, they under predicted. What you saw from this business was a little bit of progress, particularly with their business in the selling tickets, stub hub. Revenues of 5 . Gross merchandise by them up 5 but revenue up 20 , very strong. It shows they are capturing highermargin, better pieces of the online sales business. Caroline there have been concerns that amazon might be eating into the auto part. Also on ebay, they are trying to do a swift turnaround to try to make it easier for you and i to wade through the billion products they offer. Cory for 15, 20 years, amazon has been targeting ebay. It is why ebay bought paypal so it did not fall into the hands of amazon. The car business, amazon lets get away from them and ebay dominates their. Atzon is starting to look car parts, but ebay is dominant in that sector. Right now, they own the business. Caroline lets make it three a charm. At t falling a little bit. We knew it was coming up in terms of subscriptions and we are seeing anything about the time warner deal . Cory nothing in terms of progress. These results are not as bad as horizons, that is about all you can say. 1 decline yearoveryear in sales, verizon downs at percent verizon down 6 . Both hurting. The directv acquisition may not have been the best idea, enormously expensive. Directv is losing customers. The time warner merger, maybe they are hoping for adjacent businesses. Strangely, after all the effort and semidecades of trying to add wireless, it looks like the businesses with the least wireless are the ones that worry wall street the least. Caroline we will put this all in the flavor of a recordbreaking day. We will get to that in a moment. But these are companies, even though it did not seem that qualcomm has not hit targets today, generally tech seems to be on track as far. Cory the market overall seems to be taking a risk on the daytoday trading and willing to go towards stocks that are more risky. What i thought was interesting was the cisco acquisition. Priceinfinitely higher than they were going to go out on ipo. Decisions,porate more important longterm than shortterm trading, are being made based on valuations that the market might give some companies. Caroline maybe even more cash to repatriate. We will see if that trend continues. Cory johnson, thanks for joining us. We will continue our discussion of ebay earnings later with the ceo of button, which just expanded its partnership with the ecommerce giant. The overall markets continue its record climb. All three u. S. Averages closing at all time highs after corporate earnings reignited investor optimism in growth, as we heard there from cory talking about the risk and appetite. Dallas trading above 20,000. Is trading dow above 20,000. This function breaks down the sectors. You know i. T. Is a big player in nasdaq, but where is it in the dow . It is the secondbest performer, up 1. 6 , helping drive forward the recordbreaking numbers. , you will remember where you were when you saw that number. Ask dynamics on track to be the first major u. S. Tech ipo before cisco decided to snap it up. We will speak to Ceo Chuck Robbins. A reminder that all episodes of Bloomberg Technology are Live Streaming on twitter weekdays at 5 00 p. M. In new york, 2 00 p. M. In san francisco. This is bloomberg. Caroline samsung is not the only company with battery issues. Hp has recalled over 100,000 lithiumion batteries and laptops. This is an expansion of the 41,000 recalled back in june 2016. The Consumer ProductSafety Commission stated the reason is possible overheating that can pose fire and burn hazards. Hp says it will provide free replacements for each eligible battery. Cisco is making an acquisition. They are acquiring appdynamics for a cool 3. 7 billion. Cisco smashed the Software Maker just before it planned to go public. Publicscheduled to go wednesday in this years first Major Technology ipo. Bloomberg daybreak Americas Team spoke to Ceo Chuck Robbins earlier on the news. Yesterday was a great day for us. We had on display two great levers of how we drive innovation in our portfolio. In the morning, we launched cisco smart board, which will revolutionize meetings and business. One of the headlines was it was the coolest product cisco has ever built. In the afternoon, we made the acquisition of appdynamics, which we think is a tremendous synergistic acquisition. If you look at appdynamics, it is a cloudbased Application Performance Management system, but in reality, what they do is translate application performance into Business Insights for the customer, and they do it across private and public cloud. We think the synergy of what we see at the infrastructure level and what they see in the application layer creates visibility that no other company can provide. We are very excited about it. I was there yesterday, 15 minutes after we made the announced that. I addressed the Employee Base and i think they are excited as well. A good day for us. I have a couple of questions about the deal itself. You paid a pretty high price, 3. 7 billion. There were reports the ipo would go for half of that. It is a start up, so it is not making money. Is it diluted of and is it dilutive and at what point does it become accretive . Clerks there are a few things that are important for us to understand. They are the best company in this space and are growing twice as fast as their nearest competitor. There are growing faster than any publicly traded Software Company today. Caroline that was cisco Ceo Chuck Robbins. The recordbreaking sale values appdynamics at about 18 times the companys revenue in the past 12 months, good news for investors. Joining us now is one of those investors. Coled the series b round in appdynamics. Hats off to you, congratulations. How much did you put into series a and what is the reward . I made an investment back in april 2008, about five and a half Million Dollars and the company was not valued above 2. 5 million. It was valued 11. 5 million, now 3. 7 billion that must be such a reward for you. Did this take you by surprise . We understand there were talks with cisco late last night in the hotels. When did you get the offer on the table . We signed the agreement minutes before the announcement yesterday. We were really proceeding down the path to be a public company, and i think the strong belief in the companys Management Team and the board that this could be a multibillion dollar business looking forward. Cisco and the company did not know each other. Invitedys ago, chuck the ceo of appdynamics to his home, and that led to some very intense conversations. With ciscos Management Team. Team came tonamics the conclusion that merging with cisco could help accelerate the mission of the company and gain market share much faster. Caroline if it had listed, do you think it would have got to 3. 7 billion valuation anytime soon . Is hard to tell because we did not go public, but the ipo roadshow was very strong. The best data we have is that if we had gone public, it would have been a very strong ipo and would have likely traded up. Caroline i think it is fascinating. You have been on the board of appdynamics. Gridlock helped this company grow, it was the first offices provided. They were working in graylock with year when this company was first born in 2008. Apart from the pride of part in the price tag, do you think cisco was the right way to go . Every company has to make their own determination whether to continue public or be acquired at some point in their life cycle. Cisco is a worldclass technology company, a worldclass Management Team, just incredible resources rid i think incredible resources. They can be an excellent home for appdynamics, both extending reach for the product line very quickly across the Worlds Largest enterprises and also in terms of synergy with the monitoring data that cisco has. Combining that did it the application and Business Performance data that appdynamics has can be powerful. Caroline what does this say to the highly valued unicorns at the moment looking at the market and wondering whether to ipo, to be acquired . You think this might put off others going public . I dont think so. I think the indication from the roadshow that the company undertook is that the Public Markets seem to be very open and very receptive for the best technology businesses. Roadshow, the group met with cisco two days ago and it was standing room only. It was full of Public Market investors, a very rich dialogue. Just this morning, my email is full of messages from a number of Public Market investors around the country saying, congratulations, we really wanted to purchase stock in this company. Caroline now when you are looking at the money you have just you have returned your fund and then some. Where do you are looking at greylock . You have shown you are right stock picker. We are fortunate to have two very strong practices, Enterprise Technology and consumer. I spent my time on the enterprise side. It is really focused on the worlds 20,000 largest companies, which is where the world i. T. Budget lies. Maybe just two i am intrigued by andt now is taking ai Machine Learning and applying it to use cases that can be deployed in very large companies. You are seeing value in that. ,he other is Cyber Security which continues to be an area very opportune. Rest of the world should listen where you put your money next. We should be following your example. Thank you for joining us, Greylock Partners and investor in appdynamics. Coming up, chinas biggest internet giants are vying for the attention of smartphone users for the upcoming Lunar New Year holiday. We will take you inside headquarters in shenzhen and a closer look at the mobile payment strategies. This is bloomberg. Caroline the chinese Lunar New Year tradition of handing out cash stuffed red envelopes has under the 21st century, migrating to smartphones. Millions of people expected to send gifts digitally. Sentding to . 10, users more than 8 billion in one day last year. With mobile transactions more than doubling to 235 billion, encentsinside t headquarters. Reporter it is a boon for Tech Companies, thanks to digitization of this tradition. Well over one billion mobile transactions are expected as people fire off a virtual red envelope cash gift via their phones. Via a just 32 million in 2012, chinas mobile Payment Market is worth 1. 8 trillion last year, according to researchers. And affiliated companies are the two big rivals in the space to rate their absolute iuds do everything, from buying a latte to taking out a personal loan. It is all about getting a net. In recent years, we have seen many players in the mobile payments market, including commercial banks. The competition here is so fierce, it is almost brutal. Reporter with more and more chinese embracing mobile and we chatipay have come to dominate with around 90 market share. That has drawn the attention of regulators, who are expected to ramp up controls this year. The peoples bank of china wants companies to register their deposit stateowned banks. It is also developing its own crypto currency that could be used online. We follow all the regulatory guidelines of any institution offering financial services. As that adapts, which it has continuously done and will continue, we adjust our model to reflect what the regulations require. Reporter chinas banks are feeling the pain. Market Research Firms estimate lenders lost about 22 billion in pavement revenue to alipay and we chat in 2015. That is not stopping at chinas borders. Is trying tol capitalize on the 150 million chinese who travel abroad every year, teaming up with lenders in key tourist destinations to provide services. Andalso invented design further expansion. We can see most of the activity in this region, but we look closely at the u. S. And europe and the right strategy there as well. We do have a global perspective and ambition, and we will roll that out as we determined the right partners. Reporter chinas mobile payment giants are on a roll, is likely to be their biggest challenge yet. Mackenzie joins us live now from beijing. Thank you for getting up so early for us to read in the piece, you interviewed a lady about the brutal competition there was. To are the Key Competitors hourly pay and we chat and how are they tackling it . Tom there is a lot of bloodletting between we chat and alipay. Alipay expanded their market share last year, while we chat has seen a falloff in the same period grade you have got other competitors, apple pay, and huawei. Samsung, android. Also the internet Search Company here have got a wallet. Looking at the Wealth Management side of things. Ipay and we whata l chat are offering, they have got apps within an app that make it very easy to use their payment systems, whether that is managing her wealth or buying flights to travel abroad. For the challenges, they have to take on that element of things. Apple has the brand strength, still a very popular smartphone maker. Qr codes are so popular in china, mostly instore purchases and purchases for apps. It is difficult for apple to combat market shares. Caroline you mention global expansion. What is happening now . Alipay has been leading the march. They teamed up with banks in europe and you can now use alipay at stores in london. Have also teamed up with verifone in the u. S. It comes down to branding and brand recognition. Have they got that, have they got clout . That is going to be a key challenge. For the moment, they are focused on the huge number of chinese touriststhat is going to be a ky challenge. That travel abroad every year, 150 million. Caroline Bloomberg News reporter tom mackenzie, thanks so much. Coming up, the start up that anded the likes of Uber Opentable find condiments to other apps. We will speak to the ceo on how the picture of michael mobile commerce is App Integration. Ive spent my life planting a sizesix, nonslip shoe into that door. On this side, i want my customers to relax and enjoy themselves. But these days its phones before forks. They want wifi out here. But behind that door, i need a private connection for my business. Wifi pro from comcast business. Public wifi for your customers. Private wifi for your business. Strong and secure. Good for a door. And a network. Comcast business. Built for security. Built for business. You are watching Bloomberg Technology. A check of your first word news, Prime Minister theresa may