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(Bloomberg) — Microsoft Corp. will slow hiring in its Windows, Office and Teams chat and conferencing software groups, citing a need to realign staffing priorities as it approaches a new fiscal year in a time of global economic uncertainty.

All new hires must be approved by Executive Vice President Rajesh Jha and his leadership team, Jha told employees in an email Thursday, a Microsoft spokesperson said. Those groups have expanded recently and the company wants to make sure it’s making the right hires in the right places, the spokesperson said. The slowdown is not companywide, and overall the software maker will continue to hire, the spokesperson said, noting that such caution is typical in periods of economic volatility.

“As Microsoft gets ready for the new fiscal year, it is making sure the right resources are aligned to the right opportunity,” the company said in a statement. “Microsoft will continue to grow headcount in the year ahead and it will add additional focus to where those resources go.” The company’s fiscal year starts July 1. 

Other big technology companies have been slowing or freezing hiring in the past several months as stocks plummet and fears of an economic recession escalate. Chipmaker Nvidia Corp. said Wednesday it expects to decelerate hiring in the second half of fiscal 2023, and companies such as Meta Platforms Inc., Snap Inc. and Salesforce Inc. have taken similar steps. 

Earlier this month, Microsoft said it will nearly double its budget for salary increases and boost stock grants in order to better retain key workers.

Read more: Sequoia Capital tells startup founders tech is having a ‘crucible moment’

(Adds details on other companies’ hiring plans in fourth paragraph.)

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(Bloomberg) — After selling his last company, Songs Music Publishing, for about $160 million, Matt Pincus started making new deals across the record industry. The more he did, the more he realized there were few companies focused solely on music investments. So he started another one.

Pincus is announcing Thursday that he has raised about $200 million from Jonathan Soros’s JS Capital Management, Schusterman Family Investments and the merchant bank LionTree LLC to create a new company that will invest exclusively in music assets. That sum includes money he’s putting in the business, which is called Music. 

Investments in the industry have soared in recent years, with streaming services like Spotify Technology SA propelling revenue to new highs. Two of the three major record companies went public in the last two years, and catalogs for acts like Bob Dylan and Sting have sold for hundreds of millions of dollars. But many of those assets reside in diverse funds, overseen by managers with no particular expertise in music.

“I really wanted to build an investment company that is only focused on music,” said Pincus, 49. “I didn’t just want to work for a private equity firm.”

Pincus plans to make investments in the $25 million range in music technology, artist management and infrastructure — where he would take a minority stake in a company and sit on the board. But he will also take part in larger deals for music catalogs and record companies with private equity firms and look for even smaller investments in startups.

The veteran music executive said his investors have given him broad authority to make deals of his choosing, and he has set no timeline. Pincus wants to be able to stay in a holding for as many years as needed. He sold Songs after 15 years.

Pincus predicts music valuations will slow or soften, due to rising interest rates and fear of a recession. This plays to his strengths, he said, provided the entire market doesn’t melt down.

The son of legendary private equity executive Lionel Pincus, Matt Pincus brings a rare combination of hands-on industry experience and financial expertise. He came of age in New York’s music scene before enrolling in business school. He went on to work at the music company EMI.

Pincus started Songs Music Publishing in 2004 and signed acts like The Weeknd, Lorde and Diplo.

Songs Sale

Pincus met LionTree Chief Executive Officer Aryeh Bourkoff while selling Songs, and joined the investment banking company as an executive-in-residence after completing the sale of the company to Kobalt Music. Pincus helped LionTree build its music practice and they have participated in investments together.

“Matt’s independence, track record, and the relationships he’s built across the ecosystem give him a unique perspective on where music is headed,” Bourkoff said in a statement.

The new company may invest in some song catalogs, but Music will be more focused on the companies powering the modern music business.

Pincus has already made similar deals with LionTree. He is one of the largest investors in Splice, a music-creation platform, and HIFI, a financial-services firm for the industry. Those investments will remain separate from this fund.

“I’ve done this three or four times now, and a couple of them went well,” he said. 

(Updates with Soros’s company name in second paragraph, LionTree role in 10th paragraph.)

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(Bloomberg) — The UK’s national broadcaster plans to cut up to 1,000 members of staff over the next few years, as part of a plan to save £500 million annually. 

It is part of the BBC’s plan to become a “digital-led” media organization set out by the Director-General Tim Davie in a speech to staff.

The BBC will now have a single 24-hour news channel for both UK and International audiences, and stop broadcasting on smaller channels like CBBC, BBC Four, and Radio 4 Extra.

The cuts come after UK Culture Secretary Nadine Dorries froze the corporation’s license fee in January for two years, holding the flat tariff paid by anyone in the UK who uses a television set or BBC services online at £159 ($200), while inflation soars.

Dorries has repeatedly criticized the funding model, said this license fee will be “the last” before it is changed, and taken aim at the culture of the BBC. She has also pressed ahead with the controversial privatisation of Channel 4, which is also state-owned but is privately-funded.

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(Bloomberg) — Justin Timberlake sold the rights to his song catalog to Blackstone Inc.-backed Hipgnosis Song Management, Dow Jones reported, citing fund executives. 

The deal was valued at just above $100 million, Dow Jones reported, citing people familiar with matter. It gives Hipgnosis full ownership and control over the pop star’s interest in some 200 songs he wrote or co-wrote spanning his career. 

Blackstone formed a partnership with Hipgnosis in October and committed an initial $1 billion to launch a private vehicle called Hipgnosis Songs Capital, created to acquire music rights and manage catalogs, according to the report. The New York-based private equity firm, which manages about $900 billion in assets, also took a stake in Hipgnosis.

The Blackstone-backed fund is separate from Hipgnosis Songs Fund Ltd., which trades on the London Stock Exchange and has purchased more than $2 billion of music rights, Dow Jones said in its report. 

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(Bloomberg) — Alibaba Group Holding Ltd.’s quarterly revenue rose a better-than-expected 9%, reassuring investors trying to come to grips with the economic cost of sweeping lockdowns intended to eradicate Covid-19.

But China’s e-commerce leader also refrained from offering its usual outlook for the year, underscoring the unpredictable impact of a Covid Zero policy that’s already cast the country’s supply chains into disarray and hammered consumer sentiment.

Alibaba — a barometer for Chinese consumer sentiment because of its dominance of Asia’s largest retail arena — is grappling with intensifying competition and mounting economic uncertainty at home. This week, Chinese Premier Li Keqiang warned of dire consequences if officials didn’t move decisively to safeguard the economy.

Alibaba will play its part in helping shore up the economy, Chief Executive Officer Daniel Zhang told analysts on a post-earnings conference call. The company’s own revenues had slid by a single-digit percentage in April, though logistics were improving in areas such as hard-hit Shanghai as Covid cases came down. 

Alibaba shares rose 10.3% in New York, the biggest gain in almost a month, after the company reported revenue climbed to 204.05 billion yuan ($30.3 billion) in the March quarter, beating analysts’ average projections. To sustain growth over the long-term, Zhang emphasized his company would pursue higher-quality expansion, keep a lid on costs and keep expanding its ability to build cloud and digital infrastructure for customers.

“In the new fiscal year, we will focus even more on cost control and continue to improve our operating efficiency,” he said.

Click here for a live blog on the results.

What Bloomberg Intelligence Says

Alibaba’s stronger-than-expected fiscal-4Q commerce-revenue gain raises the likelihood of a speedy recovery of the internet giant’s retail and consumer units by the September quarter, assuming disruptions from Covid-19 on mainland China fade. April commerce revenue probably dropped by more than 7% from a year earlier as China gross merchandise volume declined 10% amid virus-led lockdowns. The company can stanch its slide if virus cases drop and cause restrictions to be lifted, spurring a rise in buying sentiment by fiscal 2Q. 

– Catherine Lim, analyst

Click here for the research.

Once the most valuable company in China, Alibaba has seen its market value erode since Beijing launched its sweeping crackdown on the private sector more than a year ago. The government forced Alibaba’s finance affiliate, Ant Group Co., to call off what would have been the world’s largest initial public offering in 2020, and then launched reforms that have undercut Alibaba’s business model.

Chinese antitrust watchdogs have since chilled Alibaba’s expansion plans and helped JD.com Inc. overtake it on sales growth, while up-and-coming competitors from ByteDance Ltd. to Pinduoduo Inc. are drawing users from the traditional online-shopping leaders. 

Beijing this year pledged to support the internet sector, designating the digital economy an important growth driver. Last week, rival Tencent Holdings Ltd. said it will take time for regulators to take action.

China’s two largest internet firms are responding in 2022 to a new era of sharply lower growth brought on by relentless Beijing scrutiny. Alibaba said in February it’ll focus on retaining users rather than pursuing the aggressive market-share grab of years past. That marked a major shift for a company that once fought rivals in arenas from media to the cloud and retailing, and follows more than a year of curbs on every facet of China’s internet sector.

Alibaba’s net loss widened in the March quarter to about 16.2 billion yuan, after the value of its investments fell. Its annual active users in China surpassed the 1 billion mark.

More recently, China’s commitment to Covid Zero has hit the world’s second-largest economy, with production and logistics suffering from stringent anti-virus measures. Companies are quarantining thousands of workers and having them sleep on factory floors, with operations being disrupted by repeated mass testings and movement restrictions. In a rare show of frustration, Tencent’s billionaire co-founder Pony Ma shared a viral opinion piece on the economic costs of China’s strict Covid Zero measures this week.

“The history of economic development has always been filled with twists and turns,” Zhang said. “In the long run, we strongly believe in the resilience and the potential of the Chinese economy.”

In a response to domestic hurdles, Alibaba has turned increasingly outward — Lazada, its Southeast Asian arm, Trendyol in Turkey and Daraz around South Asia have evolved into important units of the company. Alibaba has outlined a long-term goal of quintupling Lazada’s gross merchandise value, the sum of transactions across its platforms, to $100 billion.

(Updates share move in fifth paragraph.)

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(Bloomberg) — Macy’s Inc. jumped after raising its profit forecast as demand for high-end goods is persisting despite the highest inflation in four decades.

Earnings are now seen in the range of $4.53 to $4.95 a share this year, excluding some items, up from a prior forecast of $4.13 to $4.52, the department-store chain said Thursday as it reported first-quarter results. Analysts were looking for $4.36, on average.

Higher pricing, lower promotions and changing shopping habits boosted margins in the three months ended April 30 and helped Macy’s blow past earnings estimates in the quarter. Same-store sales at upscale Bloomingdale’s and the cosmetics chain Bluemercury were more than twice as high as those at Macy’s-brand stores.

“We saw a notable shift back to occasion-based apparel and in-store shopping, as well as continued strength in sales of luxury goods,” Chief Executive Officer Jeffrey Gennette said in a statement.

Macy’s shares rose 15% at 9:49 a.m. in early New York trading. The stock had slumped 27% so far this year through Wednesday’s close, compared with a 25% drop for an index of midsized consumer discretionary companies.

The upbeat forecast provides some relief to investors after retail giants Walmart Inc. and Target Corp. cut their outlooks last week, sparking a selloff in consumer stocks. The results also signal a divergence among US consumers as high-income shoppers continue to open their wallets. Retailers that cater to more affluent clients, such as Nordstrom Inc. and Ralph Lauren Corp., reported better-than-expected results this week.

On an earnings call with analysts, Macy’s said it expects sales of premium goods to continue to drive growth through the rest of the year though it saw higher spending across all income buckets in the first quarter. The company noted that customers are balking at higher prices in some categories like soft-home goods and casual active wear, where sales have been slowing.

Adjusted earnings per share were $1.08 in the quarter, beating the 83-cent average estimate of analysts surveyed by Bloomberg. Same-store sales on an owned-plus-licensed basis rose 12.4%, trailing the 13.3% average analyst estimate, though Bloomingdale’s and Bluemercury posted gains above 25% on that metric. The company reaffirmed its forecast for fiscal-year sales of $24.5 billion to $24.7 billion.

Swelling inventories have been a recurring theme for retailers this earnings season as companies look to get ahead of potential supply-chain snarls. Macy’s said its inventories as of April 30 were 17% higher than a year earlier. The company attributed the increase to a shift in consumer spending away from athleisure and home goods as people partake in more special occasions and go back to work, as well as loosening supply-chain constraints. 

Macy’s said it’s using predicative technology and data analytics to stay ahead of uncertain consumer trends. 

The company has also been betting on e-commerce to boost sales, including starting an online marketplace to expand its product assortment and highlight third-party merchants. The company said the digital business rose 2% last quarter compared with a year ago.

(Updates with comments from call in seventh paragraph.)

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(Bloomberg) — A record 3.6 million people watched the final of the UEFA Women Champions League game on Saturday, helped by a deal between DAZN Group Ltd. and YouTube to stream the competition for free.

Women’s football has exploded in popularity over recent years, with record attendances for recent high profile matches. The latest figures compares to about 2.3 million viewers for last season’s final. 

Having the games streamed on YouTube has meant having access to a younger audience, said Markel Zubizarreta, head of Barcelona’s Women team, in an interview with Bloomberg News. 

“The audience is increasingly broader,” said Zubizarreta. “Over April we were the first women team to be among the 20 clubs with more interactions on social media.” 

Although Barcelona lost the UWCL final against Olympic Lyon, it recently set two world records for stadium audience at a women’s football game: 91,553 fans attended Barcelona against Real Madrid in the Champions League quarter-final match at Camp Nou, and 91,648 people attended for the semi-final against Wolfsburg at the same venue. 

Under a four-year deal between DAZN and Youtube last June, the first two seasons of the UEFA Champions League are shown for free on DAZN’s YouTube channel. After that, all 61 matches will be shown on DAZN while 19 will be for available on YouTube. This year’s final was also shown by ITV in the UK and Ireland, TF1 France and RTVE and TV3 in Spain.  

“When we did the business case for this, we didn’t factor anybody watching this behind DAZN’s paywall, but the split on numbers is much more 70% on YouTube and 30% on our platform already,” said Ed McCarthy, DAZN’s chief operating officer, in an interview. “And that’s very exciting for us, we’re well in advance of where we thought we would be in terms of the product and the engagement of subscribers, and it validates what everybody’s done, including players and clubs.”

The total viewership for the Champion League’s 61 matches, including highlights, player interviews and other content, was 64 million views on DAZN and DAZN’s UWCL YouTube channel, DAZN said in a statement. 

Winnings have also increased. FC Barcelona received 300,000 euros ($320,000) for winning the UEFA Champions League last year, whereas this year clubs received 400,000 euros for participating and 1.3 million euros for winning, according to Zubizarreta.

US Soccer recently announced new collective bargaining agreements with the men’s and women’s players associations that will achieve equal pay “through identical economic terms.” The two deals run through 2028.

However, the winnings are still dwarfed by the mens competition. The men’s teams of Liverpool and Real Madrid will receive 15.5 million euros per club for reaching the final. 

Based on Google search data, there has also been a sustained search interest throughout the competition, according to Richard Lewis, YouTube’s director of media and sports partnership. “The more popular it is, the better for advertising and hence the more interest from sponsors,” he said in an interview. UWCL sponsorships including Heineken and Spanish pharma group Grifols. 

The UEFA Women’s EURO 2022 is set to tale place in the summer in England. According to a report by consultancy firm EY, broadcast audience could reach over 250 million. Based on ticket sales, the tournament is on track to double the attendance of the 2017 edition in the Netherlands which welcomed over 240,000 fans, according to the report. 

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(Bloomberg) — Apple Inc. is planning to keep iPhone production roughly flat in 2022, a conservative stance as the year turns increasingly challenging for the smartphone industry.

The company is asking suppliers to assemble roughly 220 million iPhones, about the same as last year, according to people familiar with its projections, who asked not to be named as they’re not public. Market forecasts have hovered closer to 240 million units, driven by an expected major update to the iPhone in the fall. But the mobile industry has gotten off to a difficult start to the year and production estimates are down across the board.

The worst inflation in decades, a war in Ukraine and supply-chain turmoil all threaten to weigh on sales in 2022. Strategy Analytics has predicted that overall smartphone shipments will contract as much as 2% in 2022, and TrendForce has twice downgraded its full-year production forecast in recent weeks. IDC and Bloomberg Intelligence analysts both forecast about 240 million iPhones for this year earlier in the period.

The Cupertino, California-based company declined to comment on the outlook, which could change depending on the economy and supply constraints in the coming months. Apple doesn’t disclose its production targets and stopped disclosing how many iPhones it sells in 2019.

Its shares dropped about 1% Thursday morning in New York.

Apple already warned that supply problems will impact sales by $4 billion to $8 billion in the current quarter, largely because Covid-19 lockdowns are roiling production lines in China. And the whole tech industry is bracing for a slowdown in consumer spending as rising fuel and materials prices push up the cost of everyday essentials.

The overall smartphone market got off to a rough start to the year, with shipments dropping 11% in the first quarter, the worst fall since the pandemic began two years ago. Xiaomi Corp. — the world’s third-biggest smartphone maker, behind Apple and Samsung Electronics Co. — posted its first-ever quarterly revenue decline this month.

Apple is betting on resilient demand for its devices due to its comparatively wealthier customer base and the strength of its software and services ecosystem fueling sales of hardware, according to the people. It’s also seeing less competition now that fierce rival Huawei Technologies Co. has been shut out of markets, they added. Huawei, once the No. 1 phone maker by shipments, has seen revenue fall for six consecutive quarters.

Moreover, Apple hopes to entice consumers with an iPhone that breaks more ground than last year’s model. The upcoming iPhone 14 handsets, due in the fall, are expected to offer new screen sizes and more novel features like satellite-based text messaging. The iPhone 13, released last September, was considered a minor update.

The company also just released an updated version of its lower-end iPhone SE that includes 5G, fueling an upgrade cycle for more budget-minded consumers.

Read more: Smartphone market suffers worst drop since outbreak

Though the Chinese lockdowns are poised to take a major toll on Apple this quarter, the company expects to manage the turbulence, one of the people said. Foxconn Technology Group, Apple’s main iPhone manufacturer, has been able to keep most facilities running. That includes its largest groups of factories in the central Chinese city of Zhengzhou.

Demand for smartphones typically ebbs in the second quarter, which may mean the impact of the lockdowns won’t be quite so severe. Suppliers will try to make up for any shortfall in production later in the year — when they hire more workers for the peak-demand holiday season — so long as China fully reopens and restores transportation lines.

“This year will be a tale of two halves,” Strategy Analytics senior director Linda Sui said in a note last month. “Geopolitical issues, component shortages, price inflation, exchange rate volatility, and Covid disruption will continue to weigh on the smartphone market during the first half of 2022, before the situation eases in the second half.”

(Updates with shares in fifth paragraph)

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(Bloomberg) — More than a half-dozen Wall Street banks are supporting Broadcom Inc.’s $61 billion acquisition of VMware Inc., the biggest software deal in years.

Goldman Sachs Group Inc. and JPMorgan Chase & Co. are advising VMware, while Broadcom is working with Barclays Plc, Bank of America Corp., Citigroup Inc., Credit Suisse Group AG, Morgan Stanley and Wells Fargo & Co., according to an announcement Thursday.

It’s unclear how much in fees the banks will generate but they’re guaranteed a big payday should the deal close. Broadcom’s bankers will also reap fees from providing $32 billion in financing. 

No boutique banks were listed on the press release, another win for the big banks, which have faced competition on advisory credit from independent firms in recent years. 

There’s a 40-day go-shop period built into the deal, so there’s a chance for other banks to get involved with a rival bidder for VMware, should that materialize.

While mergers have been down this year compared to last year’s blockbuster streak, technology has been on a tear, including landmark transactions such as Elon Musk’s takeover of Twitter Inc. and Microsoft Corp.’s deal for Activision Blizzard Inc. 

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(Bloomberg) — The biggest shareholder of India’s largest airline, IndiGo, teamed up with United Parcel Service Inc. to tap the South Asian nation’s growing logistics market.

Rahul Bhatia-owned InterGlobe Enterprises Ltd., which owns 37.82% of IndiGo, has formed a joint venture with UPS for a brand called Movin, J.B. Singh, a director at the Indian partner, said at a press conference in New Delhi Thursday. 

Movin will launch operations in a phased manner and begin services in Delhi, Mumbai and Bengaluru in July, Singh said. It will focus on domestic business-to-business logistics services with express, and day-and-time definite deliveries, giving businesses better predictability and competitiveness, UPS President for India Ufku Akaltan said at the same event.

IndiGo Chief Executive Officer Ronojoy Dutta clarified on an earnings call Wednesday that the cargo arrangement between InterGlobe and Atlanta-based UPS is a standalone operation and has nothing to do with the airline. UPS will likely focus on small shipments and surface transport, while IndiGo is into consolidated deliveries, he said.

IndiGo, also the largest domestic cargo airline, is planning to source four converted Airbus SE A321 aircraft for full-time cargo operations, locally and internationally, as goods movement was a bright spot for airlines through the pandemic. IndiGo is expecting to take delivery of its first freighter in the first half of 2022 and the rest within a year.

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