Wall Street Breakfast Podcast: UK Clears Microsoft-Activision Deal

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UK clears way for $69B Microsoft-Activision (MSFT) (ATVI) deal, tech's biggest ever. (00:24) Qualcomm (QCOM) said to cut jobs in California in effort to slash costs. (01:17) Disney (DIS), Comcast (CMCSA) hire banks to arrive at Hulu valuation for sale. (02:11)

This is an abridged transcript of the podcast.

Microsoft's (NASDAQ:MSFT) revised $69B offer to acquire Activision Blizzard (NASDAQ:ATVI) has passed muster with UK regulators, clearing the way for the technology sector's biggest-ever acquisition.

The UK's Competition and Markets Authority granted consent for the deal early Friday. This allows for the purchase, excluding Activision's non-European Economic Area cloud streaming rights.

The regulator's objections marked the last major global hurdle in a deal that has been more than a year and a half in the making.

The approval is subject to the completion of the sale of Activision's cloud streaming rights prior to completing the acquisition.

Those streaming rights will be divested to Ubisoft (OTCPK:UBSFY).

CMA Chief Executive Sarah Cardell said, "With the sale of Activision’s cloud streaming rights to Ubisoft, we’ve made sure Microsoft can’t have a stranglehold over this important and rapidly developing market."

Qualcomm (NASDAQ:QCOM) is cutting jobs in the state of California as it looks to cut costs amid continued struggles in the smartphone industry.

Bloomberg reported, citing data from the California Employment Development Department, that Qualcomm is cutting jobs in San Diego and Santa Clara, with a total of 1,258 positions being eliminated.

A Qualcomm spokesman did not confirm the size of the job cuts, but told Seeking Alpha they are part of the "continued uncertainty" in both the macroeconomic and demand environment, as previously stated on the company's third-quarter earnings call in August.

"The actions we are taking are a part of this previously-disclosed action," the spokesperson told Seeking Alpha.

Premarket Qualcomm (QCOM) is down three quarters of one percent.

Qualcomm (QCOM) is slated to release fourth-quarter results next month. A consensus of analysts expect the company to earn $1.91 per share on $8.52B in revenue.

Walt Disney (NYSE:DIS) and Comcast (NASDAQ:CMCSA) have tapped investment banks to put a value on Hulu.

The two companies co-own the streaming site.

This is happening ahead of a sales process likely to put the platform under sole ownership.

That process is the result of an arrangement made years ago when Disney (DIS) took majority ownership of Hulu by buying the media assets of Fox in a $71B deal.

As the companies grasp at a fair value for Hulu, Comcast (CMCSA) has hired Morgan Stanley (NYSE:MS), and Disney (DIS) has named JPMorgan Chase (NYSE:JPM).

At stake is just what Disney (DIS) would pay for sole control of Hulu. The 2019 agreement set a minimum valuation of $27.5B.

Other articles to look out for on Seeking Alpha:

U.S. weighs including Chinese subsidiaries overseas in new AI chip curbs - report

Dollar General jumps after appointing Todd Vasos as CEO

Tesla announces pay raise for German plant workers amid union dispute

On our catalyst watch for the day,

U.S. stocks on Thursday ended in the red.

The Nasdaq (COMP.IND) retreated 0.63%. The S&P 500 (SP500) declined 0.62% while the Dow (DJI) slipped 0.51%.

Nine of the 11 S&P sectors ended in negative territory, led by Utilities and Real Estate. Tech and Energy were the two gainers.

Now let’s take a look at the markets as of 6 am. Ahead of the opening bell today, Dow, S&P and Nasdaq futures are in the red. The Dow is down 0.1%, the S&P 500 is down 0.3% and the Nasdaq is down 0.5%. Crude oil is up 3.75% at more than $86 a barrel.

In the world markets, the FTSE 100 is down 0.6% and the DAX is down 1%.

The biggest movers for the day premarket: Comtech Telecommunications (NASDAQ:CMTL) is up 17% after the company outperformed Q4 results. And SMART Global (NYSE:SGH) is down 27% after missing the consensus mark in Q4, citing a challenging global economic environment.

On today’s economic calendar, at 9am the Fed’s Patrick Harker will speak to the Delaware State Chamber of Commerce about the economic outlook and at 10am consumer sentiment.