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Speaker 1: This is what the Flux.

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Speaker 2: I'm brand justin and it's Friday, the twelfth of September.

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Speaker 1: Jolly boy. We spoke about an ZID cutting thousands and

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Speaker 1: thousands of jobs earlier this week, and now NAB has

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Speaker 1: also gone banged. They've announced plans to come more than

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Speaker 1: four hundred jobs in its technology and enterprise operations departments,

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Speaker 1: and NAB also plans to move some positions to India

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Speaker 1: and Vietnam.

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Speaker 2: Ouch same. We've spoken a lot about the company set

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Speaker 2: Hire on the Pod in the last couple of years,

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Speaker 2: and we have a deep dive video in the Flux

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Speaker 2: app talking about the ups and the downfall of set Hire.

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Speaker 2: It is very juicy. Make sure to download the Flex

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Speaker 2: app and check out the deep die.

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Speaker 1: Three roller coaster stories today. Juzi boy, let's do it

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Speaker 1: for our first. Psi Quantum, the Aussie quantum computing startup,

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Speaker 1: has raised one billion US dollars and boosted its valuation

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Speaker 1: in the process.

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Speaker 2: So this is the reason for the spike in Brisbane

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Speaker 2: housing prices they've had tell me more so.

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Speaker 1: Psi Quantum is the quantum computing startup that was founded

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Speaker 1: in twenty sixteen by two Australians but had been based

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Speaker 1: in Silicon Valley. Yep Si Quantum has a pretty hairy

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Speaker 1: goal to build the world's first quantum computer, which means

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Speaker 1: exactly what it means.

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Speaker 2: That basically, it would allow humans to solve complex problems

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Speaker 2: exponentially faster than your traditional computer.

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Speaker 1: And this could be used for helpful applications like cracking codes,

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Speaker 1: discovering new drugs, even modeling climate and weather. If you

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Speaker 1: don't mind and.

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Speaker 2: Be man, you may remember that Australia's federal government and

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Speaker 2: Queensland governments became investors in side Quantum last year.

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Speaker 1: Yep Albo turned into a venture capital investor and the

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Speaker 1: two forms of government invested nine hundred and forty million

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Speaker 1: bucks collectively and as.

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Speaker 2: Part of the deal, side Quantum relocated its HDU to Brisbane.

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Speaker 1: But now Si Quantum is back at the table, raising

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Speaker 1: a one billion US dollar round from some heavy hitters.

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Speaker 2: We're talking black Rock, Temasek, Blackbird Benches and the big

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Speaker 2: dog in Nvidia.

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Speaker 1: The new valuation for sy Quantum seven billion US dollary, Doodas.

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Speaker 2: And then Man. Although it's early days, the investment is

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Speaker 2: looking to be a winner for the federal and Queensland governments.

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Speaker 1: So what is the key learning here?

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Speaker 2: World changing tech is often invented in one place, but

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Speaker 2: cash in somewhere else.

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Speaker 1: Does it?

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Speaker 2: Boy?

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Speaker 1: Australia has a track record of letting frontier technology slip

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Speaker 1: off shore.

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Speaker 2: And why is that?

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Speaker 1: Well, partially because local investors or governments haven't been willing

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Speaker 1: to back it early enough.

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Speaker 2: Yeah, the Australian government wanted to avoid a repeat of

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Speaker 2: what happened with photovoltaic cells.

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Speaker 1: Ooh, yes, that's the technology that converts light like solar

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Speaker 1: into electricity.

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Speaker 2: Yeah. And while this tech was invented at the University

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Speaker 2: of New South Wales, it was exported and commercialized in China.

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Speaker 1: China poured in subsidies for R and D, low interest loans,

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Speaker 1: tax breaks and cheap land for factory.

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Speaker 2: And China's believed to own more than eighty percent of

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Speaker 2: the global solar panel market now.

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Speaker 1: Which is expected to grow to a lazy two hundred

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Speaker 1: and eighty seven billion US dollars just by twenty thirty.

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Speaker 2: So clearly Australia's try to change that pattern with quantum computing.

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Speaker 1: And so far, so good. The government's invested an evaluation

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Speaker 1: of just over three billion US dollars and now it's

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Speaker 1: double Albo equals venture capitalists. For our second story, Oracle

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Speaker 1: shares had its best day since nineteen ninety two early

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Speaker 1: this week after a thirty six percent spike thanks to

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Speaker 1: the growth in its AI partnership. Interesting stuff surge, so

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Speaker 1: tell me more so.

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Speaker 2: Oracle is the US tech giant that was co founded

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Speaker 2: in nineteen seventy seven by Larry Ellison, and it's best

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Speaker 2: known for its database software. But not just that, Jaseyboy,

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Speaker 2: Oracle has been a major player in the cloud computing space,

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Speaker 2: also the enterprise software space and IT infrastructure.

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Speaker 1: Yeah. Earlier this week, Oracle announced revenue for the quarter

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Speaker 1: was slightly below what analysts were expecting, but.

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Speaker 2: Its share price still surged up to forty two percent

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Speaker 2: during the day.

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Speaker 1: And the reason for that surge is because of Oracle's

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Speaker 1: future guidance.

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Speaker 2: During the quarter, Oracle signed new deals with the who's

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Speaker 2: who of AI.

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Speaker 1: I'm talking open Ai, Xai, Meta, Invidia, AMD and many others,

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Speaker 1: and as.

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Speaker 2: A result, Oracle expects its cloud revenue to grow from

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Speaker 2: eighteen billion US dollars this year to thirty two bill

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Speaker 2: next year, and then seventy three billion US dollars the

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Speaker 2: following year. And a lazy one hundred and fourteen bill

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Speaker 2: the following and finally, by twenty thirty it expects to

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Speaker 2: hit one hundred and forty four billion US dollars in revenue.

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Speaker 1: That is very long term guidance. Juzzy boy, We can

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Speaker 1: hardly get Australian public listed companies to give six months guidances.

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Speaker 2: And be Man. Clearly, investors lapped it up because Oracle

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Speaker 2: share price had its best day in thirty two.

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Speaker 1: Years when you were in Nappy, So what's the key

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Speaker 1: learning here?

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Speaker 2: Guidance can be a double edged sword for companies.

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Speaker 1: YEP. Investors love the fact that Oracle is willing to

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Speaker 1: give four years of precise forecast, but it also.

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Speaker 2: Sets a very high bar for the company to meet.

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Speaker 1: Because investors have now purchased the stock on the basis

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Speaker 1: of this lofty guidance.

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Speaker 2: Yep and be Man. For example, if growth was to

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Speaker 2: slow or the AI boom calls off, the disappointment for

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Speaker 2: Racle investors could really sting.

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Speaker 1: YEP over promising create short term excitement but also long

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Speaker 1: term risk.

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Speaker 2: Might I remind you, be Man that big contracts don't

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Speaker 2: always mean guaranteed cash.

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Speaker 1: Yep. Oracle has announced fo one hundred and fifty five

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Speaker 1: billion dollars in revenue for quote remaining performance obligations.

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Speaker 2: And this sounds massive, But these are future commitments and

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Speaker 2: not exactly dollars in the bank just yet. So be

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Speaker 2: man guidances should be treated as a long range of

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Speaker 2: forecast rather than a long term certainty.

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Speaker 1: But it seems like Oracle investors missed that memo.

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Speaker 2: Our third and final story, Klana, the Swedish bye now

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Speaker 2: pay Later, has seen it shares rise fifteen percent in

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Speaker 2: their first day of trading on the New York Stock Exchange.

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Speaker 1: Looks like banpl isn't just dead yet, Jazzy Boy, far

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Speaker 1: from it. What's happening here?

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Speaker 2: So Klana is one of the og buy now, pay

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Speaker 2: latter companies. It was founded in Sweden.

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Speaker 1: In fact, it actually launched in two thousand and five,

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Speaker 1: around nine years before After Pay, and came.

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Speaker 2: To Australia in only twenty twenty. A man at Klana's

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Speaker 2: business and its valuation has had more ups and downs

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Speaker 2: than a Disney World rollercoaster. Well.

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Speaker 1: In twenty nineteen, Klana's valuation was around five and a

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Speaker 1: half billion US dollars, and then it rocketed to forty

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Speaker 1: five and a half billion US dollars. In twenty twenty.

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Speaker 2: One, Trusty Old SoftBank came in with the overpriced valuation.

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Speaker 1: Good yeah, But by twenty twenty two it raised again

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Speaker 1: at just six point seven billion US dollars, or.

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Speaker 2: An eighty five percent haircut on its previous valuation. And

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Speaker 2: now Klana's finally listed on the New York Stock Exchange

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Speaker 2: at a fifteen billion US dollar valuation.

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Speaker 1: Next Minute shares up fifteen percent, and.

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Speaker 2: Its IPO is a sign of renewed investor confidence in

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Speaker 2: the buy now, pay later sector.

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Speaker 1: YEP, especially after rising interest rates previously threatened its existence.

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Speaker 2: So what is the key learning here?

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Speaker 1: When interest rates rise, free credit isn't really free for

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Speaker 1: buying our paylata companies. The model works by borrowing money

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Speaker 1: from large lenders at wholesale rates and then offering shoppers

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Speaker 1: interest free installments.

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Speaker 2: And then retailers cover the costs through a fee on

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Speaker 2: each transaction.

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Speaker 1: In fact, Bain and Co. Found the average BNPL fee

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Speaker 1: charged was four point eighty four percent.

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Speaker 2: But ben Man this model only works if the margin

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Speaker 2: between the cost of borrowing and the retailer fee stays healthy.

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Speaker 1: But when cash rates climb, that margin gets a little

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Speaker 1: squeeze and that's why rising rates in twenty twenty two

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Speaker 1: and twenty twenty three, pushed by now pay lad out

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Speaker 1: to the brink of collapse bet Dozy boy Klan as

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Speaker 1: strong IPO, shows that confidence has returned to this buying

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Speaker 1: our pay later sector.

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Speaker 2: Fluxam. We've done a deep dive in the Flux app

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Speaker 2: of satire, taking through all the different stages and it

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Speaker 2: is very juicious. If you want to learn more, make

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Speaker 2: sure you download the Flux app and check it out.

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Speaker 1: Thanks for listening and we'll see you on Monday