WSJ What’s News - American Airlines Jet Collides with Army Helicopter in D.C.

Episode Date: January 30, 2025

A.M. Edition for Jan. 30. Authorities say many are feared dead after a commercial plane carrying 64 people collides mid-air with a military helicopter with three troops on board near Washington’s Reagan Airport. Plus, the Trump administration pushes federal agencies to find more DEI workers to ax. And WSJ columnist Dan Gallagher says investors are looking for answers on how Silicon Valley’s spending will help tech giants respond to DeepSeek in a big week for tech earnings. Luke Vargas hosts. Sign up for the WSJ’s free What’s News newsletter.  Learn more about your ad choices. Visit megaphone.fm/adchoices

Calling all sellers, Salesforce is hiring account executives to join us on the cutting edge of technology. Here, innovation isn't a buzzword. It's a way of life. You'll be solving customer challenges faster with agents, winning with purpose, and showing the world what AI was meant to be. Let's create the agent-first future together. Head to salesforce.com slash careers to learn more. Aviation disaster as a passenger jet and military helicopter collide over the Potomac. We've got the latest from Washington. Plus the Trump administration intensifies its push

to eliminate government DEI workers. And the emergence of Chinese AI firm DeepSeek raises questions for chip industry leader Nvidia, even as Microsoft and Meta's earnings revealed tens of billions in fresh capital spending. DeepSeek didn't exactly show you can get away with spending no money at all. But Nvidia has taken a big hit on the DeepSeek news because of worries that companies can build AI for a lot less and spend a lot less on Nvidia's chips. It's Thursday, January 30th. I'm Luke Vargas for The Wall Street Journal and here

is the AM edition of What's News, the top headlines and business stories moving your world today. Search and rescue efforts are underway in the Potomac River after a mid-air collision last night between a military helicopter and an American Airlines regional jet landing at Ronald Reagan Washington National Airport. The collision occurred just moments before the Bombardier jet was set to touch down during a busy stretch of arrivals. The American Airlines flight originating from

Wichita, Kansas, had 60 passengers and four crew on board, while three troops were aboard the Blackhawk helicopter, which was conducting a training flight. Washington Mayor Muriel Bowser declined to say if she was aware of any survivors, and Kansas Senator Roger Marshall said he was bracing for the worst. Journal reporter John McCormick has more. I got to the airport probably about 30 minutes after the crash happened. There were just enormous numbers of emergency vehicles on the tarmac. Fire officials for the Washington area told us roughly 300 first responders responded to the incident. Local officials from the airport authority and fire and rescue and a couple members of

the US Senate from Kansas, as well as the new transportation secretary briefed reporters right around 1 a.m. local time, roughly four hours after the crash occurred. They described the search and rescue scene as extremely challenging. It's 100 percent in water and there's large chunks of ice that they're navigating around, not a lot of light. So very difficult working conditions to get divers in the water and try to start, I guess, pulling bodies out of those aircraft. Authorities expect the search and rescue effort to take several days, and the airport will remain closed until at least 11 a.m. today.

According to the FAA, the National Transportation Safety Board will lead an investigation into the crash, and Defense Secretary Pete Hegseth said the Army and Defense Department are launching their own probe. The crash is the first fatal incident in the U.S. involving a major airline in more than 15 years, but follows a recent rise in near-misses and narrowly averted crashes. And for more on this story throughout the day, visit our live blog at wsj.com. We are exclusively reporting that Trump administration officials are ordering federal agencies to identify more government employees to acts in connection with a presidential ban on DEI

efforts. That's according to current and former officials familiar with internal conversations, and comes after various government offices have cut dozens of positions and canceled millions of dollars in contracts. Agencies have responded to Trump's executive orders by telling employees to report ongoing DEI-related work to a tip line or potentially face quote adverse consequences. And on tap today in Washington, Robert F. Kennedy Jr., President Trump's health secretary pick is set to face another day of Senate testimony, while FBI pick Cash Patel and director of national intelligence nominee Tulsi Gabbard begin their Senate confirmations. Israeli authorities say they'll stop working with the main United Nations agency that cares

for Palestinian refugees as of today. Israel has long been at odds with the United Nations Relief and Works Agency, known as UNRWA, and passed a law back in October that effectively bans the agency from operating in Palestinian territories. The UN says that bill violates international law. We asked journal Middle East correspondent Omar Abdel-Baki what today's news means for Palestinians and the fragile Gaza ceasefire.

What it likely means is disruption of aid deliveries within Gaza. And part of the ceasefire deal includes a clause about increasing aid deliveries in Gaza, but it's unclear how smooth that may happen or if it may happen at all with the banning of the largest aid organization there, which in addition to bringing its own aid in is sort of the backbone of all aid distribution within Gaza. They handle other organizations aid, they establish distribution points within Gaza. So ultimately what it means in Gaza is they're likely maybe a disruption in delivery of food and delivery of tents, disruption in health services within Gaza, clean water distribution

within Gaza. So, it's really a multifaceted issue. Nat. Dave. The UN says in the absence of UNRWA, it's the legal responsibility of Israel as to occupying military power in the West Bank and the Gaza Strip to take care of the Palestinians under its jurisdiction. Israel declined to comment on that claim, but said its problem is with UNRWA and that aid will continue to flow. Meanwhile, Hamas this morning released a 20-year-old

Israeli soldier, one of three Israeli hostages expected to be freed today. The two sides agreed to today's swap, which comes on top of the weekly exchanges they negotiated in order to smooth over tensions around the Gaza ceasefire deal. Coming up, we'll look at what Microsoft and Meta's earnings commentary tells us about how industry leaders see the emergence of China's deep seek and SoftBank eyes a big investment in open AI. Those stories and more after the break. TD Direct Investing offers live support, so whether you're a newbie or a seasoned pro, you can make your investing steps count. And if you're like me and think a TFSA stands for

total fund savings adventure, maybe reach out to TD Direct Investing. Microsoft and Meta got the ball rolling on a flurry of big tech earnings updates yesterday, results that come as investors try to make sense of how the sudden emergence of AI competition on the cheap from China's deep seek could shake up the AI race or reorder massive investments that are being pursued by industry leaders. Wall Street Journal heard on the street tech columnist Dan Gallagher tuned in to Microsoft and Metta's earnings calls for some answers. And he joins me now from San Francisco. All right, Dan, what did we learn yesterday evening? Well, we learned that the money's still going out the door. $37.4 billion is what their combined capital spending was.

Just in the December quarter, and the commonality that Microsoft and Metta both have is they're both now expending about 30% of their revenue on capital expenditures. And relative to other tech giants like Google and Amazon, who spend more in the mid teen range for CapEx, it's really significant. I'm curious, Dan, if the big topic of conversation this week, the entrance onto the scene of Chinese AI company DeepSeek, which managed to develop a large language model at a fraction of the cost of some of their competitors came up in these earnings calls, did it? Both companies address

it a little differently and DeepSeq actually has different implications for them because DeepSeq is an open source AI model and Meta is one of the few big tech stocks that have actually come up since the whole DeepSeq revelation last week and that's because Meta 2 is also pursuing this open source AI and so DeepSeek success has kind of been seen as like validating Meta's approach a little bit. But what was interesting in the call yesterday is that Meta CEO Mark Zuckerberg was interested in the developments that DeepSeek brought but also mentioned the fact that AI is still going to depend on compute power and so he specifically said our ability to spend a lot

is a competitive advantage. So for their part, Meta didn't broadcast any plans to slow down their spending. In fact, late last week, they said they were going to really ramp up their spending in 2025. It sort of sounds like you're saying there, Dan, that even if the example of DeepSeek is a bit humbling, showing that a lot can be done with relatively little.

That's not going to meaningfully change how, for instance, Microsoft and Meta are going about their long-term plans. And if anything, maybe they can just get more from the money that they've already committed to capital expenditures. DeepSeek didn't exactly show that you can get away with spending no money at all. There's still a lot of advantage to having the compute power that actually costs a lot. What DeepSeek showed is that you can get to a quality AI and there's some tricks

to make it a little more cost effective. And both companies actually spoke well of that and are probably gonna adopt some of those changes. Especially Microsoft noted that as computing gets more efficient and cheaper, adoption grows. But these are companies that their advantage right now is the fact that they have immense cash and resources and so they can spend.

And keep in mind, there's a caution that for DeepSeq, there's still a lot of questions about what did they really have, what did they really use based on the numbers they reported. All right, so maybe too early to gauge its impact, like Zuckerberg said yesterday, but Nvidia investors certainly beg to differ. We have been speaking about Microsoft and Meta in their own right, but they are also

two of the chip makers' biggest clients. And I'm curious what all the DeepSeek talk this week could mean for the semiconductor industry. Well, Nvidia's seen its market value really take a hit over the last week because of the DeepSeek news and because that raises the worry that companies can build AI for a lot less and spend a lot less on Nvidia's chips. Yesterday's reports are going to leave that question a little bit in doubt. We saw Nvidia's stock go down a little bit with these reports.

Plus there was this added report from Bloomberg about how the Trump administration may clamp down further on the chips they can sell into China because of deep-seek breakthroughs. For Meta and Microsoft, there's still a question of where capital spending is going to go, especially beyond this year. So there wasn't any new news on that front. So once we see maybe Amazon and Google's reports next week, maybe we'll get some more clarity on where some of these big Nvidia customers are going to go with their spending and investment. Right now, it's still a little bit unclear. That was Wall Street Journal, Hurt on the Street tech columnist Dan Gallagher in San Francisco.

Dan, as always, thanks for staying up late for us. My pleasure. Thanks for having me. We are reporting that SoftBank is in talks to invest $15 to $25 billion in OpenAI, potentially deepening the relationship between the two companies. Some of that equity investment could be used for OpenAI's commitment to Stargate, a joint venture with SoftBank and others that it announced last week at the White House. That is according to a person familiar with the matter who says the deal would make SoftBank

OpenAI's biggest investor displacing Microsoft, which has committed nearly $14 billion so far. However, SoftBank would have a smaller stake in OpenAI's for-profit division as Microsoft invested earlier. The Financial Times previously reported on the investment talks. And in other market news today, Tesla shares are up in off-hours trading, even though the EV maker's core automotive business saw revenue drop 8 percent in the most recent quarter.

Investors were cheered by comments made on yesterday's earnings call by CEO Elon Musk, who talked about fully self-driving cars hitting US roads this year and shared a goal of building 10,000 optimist humanoid robots by the end of 2025. And on deck today, more tech earnings with Apple and Intel due to report after the closing bell will also have results from Visa, MasterCard, and Blackstone, among others, and get a first look at fourth quarter US GDP at 8.30am Eastern. And that's it for What's News for this Thursday morning.

Today's show was produced by Kate Bulevant and Daniel Bach with supervising producer Christina Rocca, and I'm Luke Vargas for the Wall Street Journal. We will be back tonight with a brand new show. Until then, thanks for listening.