Microsoft and OpenAI Agreement; UPS Soars; Paypal Surges

On this episode of Stock Movers:
- Microsoft (MSFT) and OpenAI finalized a new agreement in a long-negotiated partnership.Under the new pact, Microsoft will get a 27% ownership stake in OpenAI worth about $135 billion, the companies said in a statement Tuesday.In addition, Microsoft will have access to the artificial intelligence startup’s technology until 2032, including models that achieved the benchmark of AI general intelligence.
- United Parcel Service (UPS) shares soared after it smashed Wall Street’s profit expectations by cutting costs and eliminating 34,000 jobs this year.The cuts to its permanent operational workforce — a group that includes drivers and package handlers — marked a 70% increase from its previous target. As part of the sweeping cost-savings initiative, UPS has closed daily operations at 93 leased and owned buildings in 2025, according to a statement Tuesday.
- PayPal (PYPL) shares surged after it announced a partnership with OpenAI and boosted its adjusted earnings per share guidance for the full year, with the guidance beating expectations. Third quarter EPS and net revenue also came in above the average analyst estimates.

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Episode Transcript

Speaker 1 (00:02):
Bloomberg Audio Studios, podcasts, radio News.

Speaker 2 (00:08):
The Stock Movers Report, your roundup of companies making moves
in the stock market, harnessing the power of Bloomberg Data.

Speaker 3 (00:16):
Take a look and see what's happening in the marketplace.

Speaker 2 (00:19):
Here we're going to go Tonita Sokova from Bloomberg newsdnitsa
what are you looking at here in the markets?

Speaker 1 (00:24):
We have to start with Microsoft. Obviously the big story
of this morning. Microsoft and open Ai finalist this new agreement.
It's been in the works for a very long time.
The ticker, of course is MSFT. The SOCOs up as
much as four percent now it's about three percent, clearly
one of the big gainers in the SMP. This is
removing a layer of uncertainty for both companies. Then under

(00:47):
the new pack, Microsoft is getting twenty seven percent ownerships
take in open Ai and the price tag of that
is one hundred and thirty five billion. Of course, the
agreement clears society major obstacle for all Ai. The company
has spent so much time of this year working to
restructure and become this traditional for profit company, and that

(01:07):
has been an obstacle there. Microsoft will still have access
to artificial intelligence startup technology until twenty thirty two, including
models that achieve the benchmark of AI General Intelligent, Microsoft
will no longer have a right for first refusal on
open air compute. But the start up has made an
additional two hundred and fifty billion commitment to buy services.

Speaker 3 (01:32):
So yeah, this is clearing a major obstacle.

Speaker 1 (01:34):
The really strong reaction in the market, and still even
as indices are losing some of the gains there, the
reaction remains very positive.

Speaker 3 (01:43):
And then it's a ups kind of two stories. They
had a strong profit but also big layoffs too.

Speaker 1 (01:48):
Big layoffs, yes, but investors who have been reacting positively
to that, And obviously is the main number that has
really impressed the street is adjusted earnings that came at
one door seventy four cents, and the street was expecting
one door thirty two cents, So really big positive surprise there.
Of course, profit expectations are helping, but cutting costs and

(02:12):
eliminating thirty four thirty two thousand jobs has been a
major impact here. The tagories ups of course, and shares
are up about five percent. Actually, in urdered trading they
jumped as much as thirteen percent, so perhaps some of
that euphoria is fading. The cuts to its permanent operational
workforce includes drivers and package handlers, and some massive jump

(02:36):
from last year is a seventy percent increase from last year.

Speaker 3 (02:39):
As part of the sweeping cost saving.

Speaker 1 (02:40):
Initiative, UPS has closed a lot of operation ninety three
least and on buildings. The shares were under so much
pressure this year they were down twenty nine percent. Similar
story with FedEx, which was under a lot of trouble.
It actually in September it said that in this pate
a one billion headwind.

Speaker 3 (02:57):
That'd say, we're seeing some relief for both companies.

Speaker 1 (02:59):
Today, we're seeing some optimism for four quarter revenue higher
than the company previit is expected, but we're still with
the under pressure here today, so we're yet to see
if that earnings momentum can be maintained.

Speaker 2 (03:13):
Really.

Speaker 1 (03:14):
Finally, PayPal PayPal It's all open Ai story. PayPal share
search after announced a partnership with open Ai and of
course a pretty good earnings report. It boosted it's adjusted
earnings per share guidance for the full year. What we're
seeing is that PayPal raised its twenty twenty five just
earning per share forecast. It's about twenty cents higher than before.

(03:35):
The ticker, of course, is PYPL. The stock is about
eleven percent one of the beginners.

Speaker 3 (03:41):
Today.

Speaker 1 (03:42):
PayPal is instituting its first dividends It's fourteen cents per share,
so perhaps some of the optimism is coming from that
as well. The company announced the tie up with open Ai,
so they're gonna embed it's digitalality judge GPT. Obviously everyone
is using it for searches, and the idea is that
the company that users will be able to use PayPal

(04:03):
as a payment mental at the checkout and they will
also process venors as the instant checkout feature.

Speaker 3 (04:09):
So perhaps really big partnership there. But yeah, big jump
on the news.

Speaker 2 (04:15):
The stock Movers report from Bloomberg Radio. Check back with
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