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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: You're listening to the Bloomberg Intelligence podcast. Catch us live

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Speaker 2: weekdays at ten am Eastern on Apple card playing and

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Speaker 2: Broid Auto with the Bloomberg Business app. Listen on demand

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Speaker 2: wherever you get your podcasts, or watch us live on YouTube.

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Speaker 3: One of the names really in the news today for

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Speaker 3: not the good reasons is super Micro Computer.

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Speaker 4: It's order to resign. That's not good.

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Speaker 3: The stock's all thirty percent on that news. Let's break

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Speaker 3: down what's going over there, because this was a high

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Speaker 3: flying AI type stock that peaked about one hundred and

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Speaker 3: eighty dollars a share back in March.

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Speaker 5: Yeah, it added to the s and P five hundred

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Speaker 5: back in March, right, so.

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Speaker 3: Right at the all time Hi, but boy down at

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Speaker 3: thirty four dollars I share it now. Wu Jinhoge joins us.

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Speaker 3: He's a senior technology analyst for Bloomberg Intelligence. He's sat

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Speaker 3: in our Princeton, New Jersey office. Which what happened today

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Speaker 3: over at super micro Computer?

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Speaker 1: Yeah, so thanks Paul. Look, there's been some filing delays

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Speaker 1: at super Micro, some differences of opinion in terms of

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Speaker 1: the auditor and the management team and Essentially, the uh,

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Speaker 1: the uditor resigned due to quote unquote integrity issues with

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Speaker 1: the management team there.

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Speaker 4: And and this isn't like Joe's CPAs. This is this

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Speaker 4: is a big deal resigning and.

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Speaker 3: This does not happen often at all. So what's Ernst

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Speaker 3: and Young saying about why they resigned, Well, you know,

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Speaker 3: in the.

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Speaker 1: AK filing, essentially Ernest and Young is saying that there

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Speaker 1: were some differences of opinion and they didn't think that

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Speaker 1: there was enough transparency from the auditor committee as well

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Speaker 1: as integrity issues from the auditor committee. So look, quite

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Speaker 1: quite frankly, it's the first time I've ever seen language

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Speaker 1: like that. And the other thing that I can state

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Speaker 1: is that, you know, Ersten Young is the second auditor

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Speaker 1: that super Micro had in the span of eighteen months,

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Speaker 1: so they were supposed to clean up the issues from

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Speaker 1: the prior orditor, and it sounds like they found issues

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Speaker 1: that just couldn't be resolved.

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Speaker 5: And of course the resignation comes after news broke last

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Speaker 5: month that the DOJ had launched a probe into an

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Speaker 5: ex employee's claims that super Micro actually valulated accounting rules.

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Speaker 5: What do we know so far about how many different

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Speaker 5: issues there are kind of more broadly when it comes

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Speaker 5: to this company.

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Speaker 6: Yeah, so.

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Speaker 1: Not much news has come out of the DOJ probe,

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Speaker 1: but it is bringing up some older issues that caused

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Speaker 1: their delisting roughly three or four years back. Essentially, they

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Speaker 1: were very aggressive on their accounting side, and it seems

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Speaker 1: as if, based on a short report that came out

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Speaker 1: in July, it seems as if they went back to

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Speaker 1: their old ways in the recent months, in recent quarters.

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Speaker 3: Well, which just as an outside observer here, I see

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Speaker 3: a story like this and I say, we need change

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Speaker 3: at the board level, and I need change in the

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Speaker 3: c suite level. Are you hearing calls from some of

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Speaker 3: their shareholders for some types of moves like that.

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Speaker 1: Well, that's how we tidled. Are we react report? It's like, look,

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Speaker 1: super Micro needs more than an orditor to change to

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Speaker 1: fix this, and we were concerned about their corporate governance.

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Speaker 1: If you keep in mind that there aren't many independent

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Speaker 1: board members, one of whom includes the wife of the CEO,

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Speaker 1: there really needs to be a lot more independence on

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Speaker 1: the board. And quite frankly, given the now growing concerns

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Speaker 1: of financial mofeasings, I think the CFO has to go

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Speaker 1: and you know, if they can't clean this up, there

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Speaker 1: might be a need for a change at the top.

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Speaker 5: Paul mentioned the stocks being that we've been seeing in

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Speaker 5: it so far today down over thirty percent on Paceports,

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Speaker 5: worst day since October of twenty eighteen. From a technical perspective,

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Speaker 5: how much more pain do you think there is to

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Speaker 5: run here?

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Speaker 1: Well, the question is is, you know, are the revenues real?

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Speaker 1: I do think that the revenues are real. I don't

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Speaker 1: know how real the profitability may be, right because there

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Speaker 1: are multiple ways to probably manipulate the numbers. The one

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Speaker 1: thing that we wrote is that you know, the near

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Speaker 1: term deals are probably intact because it's really tough to

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Speaker 1: change switch vendors for an AI deal. But longer term

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Speaker 1: there are going to be downs in terms of water activity.

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Speaker 1: I'm working with super micro, so it's going to be

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Speaker 1: the future outlook going forward that that could be at

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Speaker 1: risk and could drive the stock going forward.

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Speaker 4: All right, well, just thanks so much for joining us.

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Speaker 3: Woujin Hoo, he's a senior technology channels for Bloomberg Intelligence.

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Speaker 3: He's based on there in our Princeton office. Again, the

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Speaker 3: stock off thirty percent today. S MCI is the ticker.

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Speaker 3: Despite that, it's still up about twenty percent on the year. Yeah,

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Speaker 3: it's got a market cap right now, just about twenty

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Speaker 3: billion dollars. But again, this thing back in March of

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Speaker 3: this year was one hundred and eighty.

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Speaker 6: Dollars, right.

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Speaker 5: It had been the best performing stock in the S

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Speaker 5: and P five hundred at one point for the year,

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Speaker 5: even outpacing in videos earnings. But then once you see

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Speaker 5: these big declines, obviously not anymore.

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Speaker 3: And Wujin saying that this is the second auditor they

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Speaker 3: had in eighteen months, I think tells you all you

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Speaker 3: need to know here. It's just it kind of goes

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Speaker 3: to a credibility of their reported financial results. And if

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Speaker 3: as an investor, if you don't feel comfortable with, you know,

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Speaker 3: the financial results, Yeah, it's tough to put evaluation on that.

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Speaker 3: I think that's kind of what we're seeing today. We're

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Speaker 3: seeing that move again, a seventy percent, seven zero percent

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Speaker 3: move off of that March high. So again the market

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Speaker 3: kind of voting with its feet.

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Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live

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Speaker 2: weekdays at ten am Eastern on applecar Play and Android Auto.

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Speaker 2: With the Bloomberg Business Act. You can also listen live

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Speaker 2: on Amazon Alexa from our flagship New York station, just

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Speaker 2: Say Alexa playing Bloomberg eleven thirty.

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Speaker 4: We had some of the big European banks started reporting.

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Speaker 4: UBS came out with.

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Speaker 3: Some better than expected numbers, but management, I think, you know,

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Speaker 3: they're saying, hey, there's some risks out there, so kind

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Speaker 3: of tempering the outlook a little bit. So let's break

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Speaker 3: it down with Alison Williams. She is the senior bank

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Speaker 3: sannels for Bloomberg Intelligence. So Allison, I mean, you know,

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Speaker 3: of the big European banks, UBS is the one I

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Speaker 3: think a lot of people focus on because they have

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Speaker 3: such a big presence here in the US. What did

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Speaker 3: you see coming out of UBS and kind of what's

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Speaker 3: their outlook?

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Speaker 7: So a really strong quarter. Fundamentals look good. I think

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Speaker 7: there are some concerns about capital and that might be

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Speaker 7: weighing on the shriffes today. But you know, to your point,

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Speaker 7: people look at their business. Sixty percent growth in their

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Speaker 7: America's trading business, so so wow is the word. It

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Speaker 7: was a record trading, record third quarter trading for them.

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Speaker 7: Keep in mind that third quarter tends to be weak,

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Speaker 7: so but it was that it was the strongest third

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Speaker 7: quarter they've ever had, and that was really due to

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Speaker 7: cash equities and derivatives strengths of the bank. So twenty

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Speaker 7: seven percent growth really looking good and a lot of

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Speaker 7: momentum coming into the fourth quarter. The other positive for UBS,

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Speaker 7: you know, that core wealth franchise is really what sets

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Speaker 7: them apart, and they did have very strong flows inflows

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Speaker 7: across all the regions, especially Asia, so that's also very good.

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Speaker 7: And then on the deal execution side, we also like

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Speaker 7: what we're seeing there in terms of their cost progress.

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Speaker 7: You know, the grossed cost saves are over fifty percent

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Speaker 7: the way there, so that's a positive the non core unit,

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Speaker 7: so that's you know, stuff they want to get rid of.

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Speaker 7: They're making cuts there faster than expected. But capital, as

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Speaker 7: I said, that was the one thing I think, you know,

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Speaker 7: investors are still a little bit skittish on. They did

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Speaker 7: actually take a cut to their capital ratio in the

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Speaker 7: quarter basically because they voluntarily are kind of giving up

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Speaker 7: some accounting relief. So you know, I think that that's

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Speaker 7: you know, that's accounting is sort of just noise in

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Speaker 7: my view. But they did say that, you know, they're

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Speaker 7: not sure if when they report the fourth quarter of

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Speaker 7: February if they're going to be able to give guidance

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Speaker 7: on buybacks. And that's because you know, while they're executing

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Speaker 7: on this deal, fundamentally regulators, you know, are concerned about

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Speaker 7: the size and they may force them to hold more capital.

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Speaker 5: Looking over at UBS's stock right now, down about three

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Speaker 5: point six percent on pace, sports worst day since August. Second,

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Speaker 5: of course, you were talking about obviously capital, but there

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Speaker 5: was also a lack of any further guidance from executives

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Speaker 5: on that analyst cause, well, so how much does that

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Speaker 5: also wing on the stock at this point?

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Speaker 8: Allison, Well, I think it really is the lack of

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Speaker 8: guidance on capital to your point that that is weighing,

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Speaker 8: because you know, if they basically they restarted their buyback.

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Speaker 7: You know, in the first half, but people are very

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Speaker 7: focused on the prospects for capital return and I think

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Speaker 7: the fact that you know, not only did they not

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Speaker 7: give guidance, but they said they might not be able

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Speaker 7: to give guidance in February is the concern.

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Speaker 3: So hel representatives you b s UBS of kind of

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Speaker 3: some of the other European banks, Allison.

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Speaker 7: So it's interesting that you know, Ubans versus the other bank.

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Speaker 7: They are more skewed to the equities business. They do

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Speaker 7: have a very strong US presence, as you said, they

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Speaker 7: also tend to be strong in Asia, and we really

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Speaker 7: saw a lot of strength their late quarter that benefited,

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Speaker 7: you know, the companies such as JP Morgan and Morgan Stanley.

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Speaker 8: So Deutsche Bank does.

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Speaker 7: Not have the equities business, but they were very strong

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Speaker 7: in stick and we'll see what happens with you know,

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Speaker 7: BNP and zctin are the next ones to come, so

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Speaker 7: they might not get that same lift that UBS saw

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Speaker 7: from their kind of unique footprint. But generally we did

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Speaker 7: hear about strength across regions of cross cash and derivatives,

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Speaker 7: and derivatives is a strength for those two French bands,

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Speaker 7: and so we think that we could see some strength

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Speaker 7: there tomorrow.

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Speaker 4: All right, Alison, thank you so much for joining us.

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Speaker 3: As always, Alison Williams, she's a senior banks analyst for

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Speaker 3: Bloomberg Intelligence globally. Full disclosure, I am a client of UBS.

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Speaker 3: Or shout out to Tonyo C and the boys.

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Speaker 2: You're listening to the Bloomberg Intelligence podcast. Catch us live

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Speaker 2: weekdays at ten am Eastern on Apple Card playing Android

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Speaker 2: Otto with the Bloomberg Business app listen on demand wherever

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Speaker 2: you get your podcasts, or watch us live on YouTube.

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Speaker 3: Again, look at that Eli Lilly story. It stops down

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Speaker 3: five percent, so it's well off. It's in traud de

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Speaker 3: Loso's off about eleven or twelve percent earlier. But guess what,

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Speaker 3: it's up forty seven percent year to date. So this

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Speaker 3: one's had a nice run. It's got an eight hundred

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Speaker 3: billion dollar market cap. Clearly a little bit of a

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Speaker 3: miss here today. Let's break it down with somebody who

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Speaker 3: knows Eli Lillly belderan anybody out there at Sam Fazeli,

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Speaker 3: director of research for Global indust and a senior pharmaceuticals analyst.

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Speaker 3: They go to Voice in the City of London if

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Speaker 3: you want to talk about this healthcare stuff, and if

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Speaker 3: you want to talk wine. He's also probably better adapted that. So,

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Speaker 3: Sam Eli Lilly, I know you're you know this company

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Speaker 3: really well? What did they disclose today and the results

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Speaker 3: and why is the stock selling off?

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Speaker 6: Yeah?

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Speaker 9: So hi Paul, nice to see you all again. I'm

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Speaker 9: looking at the screen. You know, as as you guys

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Speaker 9: said earlier, it had been down like thirteen and a half, fourteen,

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Speaker 9: fifteen percent and now it's kind of coming back. The

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Speaker 9: call has just finished, the Q three call, and I'll

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Speaker 9: just break it down quickly for you. When they reported

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Speaker 9: we got a miss, right, and I'm looking at it

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Speaker 9: right now, they missed by six percent on revenue.

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Speaker 6: That is not what you do when you're a.

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Speaker 9: Sixty pe company, right, It just it doesn't ide is

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Speaker 9: the world's not forgiving enough of that. And by the way,

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Speaker 9: those burritas, you're talking about seven hundred and eighty five

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Speaker 9: calories for an average burreto. Wow, So if you want

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Speaker 9: to help you like Lily, you have three of those

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Speaker 9: a day.

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Speaker 6: Yeah.

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Speaker 9: No, So so just breaking that down further that this

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Speaker 9: was two drugs on jar O and zep bound and

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Speaker 9: those are the drugs that everybody talks about. This is

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Speaker 9: the the obesity drugs that are.

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Speaker 6: On the market. They missed.

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Speaker 9: Why did they miss The company said that it's because

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Speaker 9: there was an inventory d stocking going on at some wholesalers.

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Speaker 9: So people go, wait a minute, you saying to me

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Speaker 9: that demand cannot be satisfied, supply were supply limited, So

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Speaker 9: why is there an inventory issue in the middle here?

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Speaker 9: And of course that's what led to the question of

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Speaker 9: oh my god, are we overestimating demand?

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Speaker 6: Here?

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Speaker 9: Is the company overestimated it? Why it's the world over

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Speaker 9: estimating demand? So why have we come back from five percent?

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Speaker 9: Simple answer. It sounds like with the twelve different forms

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Speaker 9: of the drugs that they have that no one in

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Speaker 9: this early launch phase we can call it early launch, right,

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Speaker 9: given that it's been a couple of years, is really

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Speaker 9: a to manage and work out what they need to

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Speaker 9: have as inventory, because in such a massive product, you're

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Speaker 9: going to have an impact on working capital, even for

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Speaker 9: the wholesalers. It sounds like that that's the issue that

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Speaker 9: even Lily themselves can't necessarily forecast here, right, I mean

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Speaker 9: the actual details of how much of each product has made.

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Speaker 9: If that's true then and I think you get a

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Speaker 9: little with of that in the fact that Folier guidance

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Speaker 9: wasn't dropped by as much as the miss that at

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Speaker 9: least currently they are optimistic about picking a whole bunch

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Speaker 9: of that back up in the Q four that you

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Speaker 9: should not worry about demand you talk to any doctor

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Speaker 9: you want, do they say, oh, I have no patience

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Speaker 9: left to asking before he set bound or we go

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Speaker 9: viaor whatever.

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Speaker 6: So I think that's what's.

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Speaker 9: Happening here the difficulty in managing and thinking about how

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Speaker 9: to manage your inventory.

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Speaker 5: Something I wanted to pick your brain about was when

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Speaker 5: it comes to knockoffs, because we saw a huge drop

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Speaker 5: in hymns and hers earlier this month. So they were

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Speaker 5: so they previously were allowed to manufacture copycap drugs when

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Speaker 5: they're deemed in short supplied by the FDA, But the

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Speaker 5: FDA at that time said when it came to zetbound

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Speaker 5: and Manjarro, specifically for Eli Lily, they weren't shortage anymore.

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Speaker 5: So that's why you saw that drop there. But they

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Speaker 5: still when it came to a zempic and Wegovi. When

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Speaker 5: you think about Novo Nordisk, they were still able to

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Speaker 5: offer compounded version actually versions of those. So I'm wondering,

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Speaker 5: when you think about Eli Lily versus what's happening with

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Speaker 5: Novo Nordists, how does that kind of come into play

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Speaker 5: when you're thinking about when it comes to sort of

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Speaker 5: the knockoffs and the copycat type drugs.

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Speaker 6: Yeah.

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Speaker 9: Sure, I mean I'm not even sure that people have

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Speaker 9: stopped making compounded versions of zep bound and Manjara because

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Speaker 9: the FDA kind of reeled back a little bit and said, oh,

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Speaker 9: we're going to actually look at this again.

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Speaker 6: So I don't think that story is finished.

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Speaker 9: I think that these folks are some folks are still

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Speaker 9: able to supply those from a compounded pharmacy perspective. So

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Speaker 9: you know that is that's that's a lot, that's a

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Speaker 9: root that the FDA does to people. If there's a

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Speaker 9: shortage of a drug and someone else can make it,

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Speaker 9: well let them do it.

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Speaker 6: The interesting angle, of course, is that a whole bunch.

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Speaker 9: Of people who are taking off the compounded pharmacists are

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Speaker 9: probably paying less, and therefore if they're forced to go

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Speaker 9: and take it from a prescription, they may have to

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Speaker 9: pay more out of pocket. So that's not going to

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Speaker 9: be a leaving a particularly good taste in folks mouths

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Speaker 9: once that this.

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Speaker 6: Actually happens. But it hasn't happened yet.

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Speaker 9: So and they did say on the call that this

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Speaker 9: is not because there's enormous demand being fulfilled by compounded pharmacies.

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Speaker 9: It's literally to do with that inventory management issue, where

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Speaker 9: what are.

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Speaker 3: The companies saying sam about getting this in an oral format.

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Speaker 3: I think that might be one of the next big

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Speaker 3: I guess mileposts for this type of treatment.

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Speaker 9: Yeah, I remember, Paul, there's already an oral form of this.

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Speaker 9: It's called Robelsus. It's from over NOTICEK. It's just a

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Speaker 9: tough drug to use because you have to have it

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Speaker 9: within about half an hour of eating. You can't take

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Speaker 9: it too close or too far from any team because

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Speaker 9: you need an empty stomach.

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Speaker 6: Before you take the drug.

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Speaker 9: And it's a big dose, and maybe the side effect

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Speaker 9: profile isn't as great and the weight loss isn't as great.

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Speaker 9: So people are trying to develop oral versions of these drugs,

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Speaker 9: but also oral drugs that are like normal drugs, small

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Speaker 9: molecules that they can swallow as a pill once today.

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Speaker 6: So that's coming.

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Speaker 5: So what do you think shareholders need to watch for

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Speaker 5: next when it comes to especially after its outlook disappointed.

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Speaker 6: I think we need to see how Q four does.

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Speaker 9: So let's hope that that they're current guidance. At least

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Speaker 9: they meet it, maybe beat it, that would be nice.

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Speaker 9: The issue is then we move into a Q four.

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Speaker 9: There's an interesting result from a click or child that's

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Speaker 9: coming up. They've done this before. They're comparing zep bound

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Speaker 9: with big go V, and I suspect that they're hoping

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Speaker 9: and that that data suggests that they might. They will

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Speaker 9: show that it has better weight loss. Whether the side

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Speaker 9: effect profile will be better or different, time will tell.

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Speaker 9: But that's there are not many farmer companies do these

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Speaker 9: type of excuse me, head to head trials because that

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Speaker 9: takes some Uh yeah.

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Speaker 4: Yeah, no, I just want to get real quick.

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Speaker 3: What's the latest thinking on the size of this market?

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Speaker 4: And you guys have done a lot of work on this.

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Speaker 9: Yeah, I think I think my Key's latest numbers that

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Speaker 9: are ninety three billion.

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Speaker 6: I don't remember exactly. It's big, well out of nothing

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Speaker 6: exactly so, but five we have a whole load of data. Company.

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Speaker 4: Yes, is there any significant evidence that red wine is

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Speaker 4: healthy for you?

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Speaker 9: I'm not going to go there because I'm at a

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Speaker 9: health drug analyst, not a red wine analyst.

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Speaker 6: I just know that I enjoy a glass of two.

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Speaker 6: You gotta you gotta have to remember it's also bad

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Speaker 6: for you because it's cancer.

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Speaker 4: All sorts of yes, loves important.

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Speaker 9: We have to be fed a whole bunch of people

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Speaker 9: listen to this. This is this is not this is

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Speaker 9: not about a bottle of wine a day. Maybe a glass,

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Speaker 9: but even then, I think the medical professional says be careful,

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Speaker 9: but I choose to take that risk and I do

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Speaker 9: love it.

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Speaker 4: We separate. Sam Fazali, thank you so much for that.

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Speaker 4: Sam Fazeli's a director of research.

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Speaker 3: He also covers the pharmaceutical industry for Bloomberg. In Intelligence

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Speaker 3: over in London.

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Speaker 2: You're listening to the Bloomberg Intelligence podcast. Catch us live

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Speaker 2: weekdays at ten am Eastern on Apple card Play and

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Speaker 2: Android Auto with the Bloomberg Business app. You can also

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Speaker 2: listen live on Amazon Alexa from our flagship New York station,

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Speaker 2: Just Say Alexa, playing Bloomberg eleven.

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Speaker 4: Thirty rights back in the middle of earning season.

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Speaker 3: This is the busiest week of the quarter in terms

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Speaker 3: of companies market cap reporting big on last night friends.

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Speaker 5: Google, it's right of the market cap for the S

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Speaker 5: and P five supporting this week right Actually busy.

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Speaker 3: Seek good quarter. I guess across the board. Ben Deep

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Speaker 3: Singh joins us. He's a senior technology analyst for Bloomberg Intelligence.

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Speaker 4: Mandy.

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Speaker 3: Everybody knows Google, they know the shirt story. What did

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Speaker 3: you learn last night from Google? And their results?

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Speaker 2: That you know?

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Speaker 10: Search Cloud YouTube. These are three separate businesses doing extremely

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Speaker 10: well at scale, I mean double digit growth for search

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Speaker 10: business is really stellar when you think of all the

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Speaker 10: pressure they've been facing, you know, when it comes to

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Speaker 10: new entrants like CHATGPT and Perplexity and whatnot. And everyone

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Speaker 10: is of the belief that they would take at least

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Speaker 10: some share from Google, at least in terms of ad revenue.

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Speaker 10: Google hasn't lost any share. In fact, it's a very

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Speaker 10: healthy growth at their scale.

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Speaker 4: And YouTube.

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Speaker 10: Look fifty billion plus revenue rundrate seventy thirty split between

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Speaker 10: subscriptions ads is seventy and thirty percent of subscriptions, and

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Speaker 10: subscriptions grew, you know, twenty eight percent. I mean, just

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Speaker 10: think about fifteen billion dollar subscriptions business growing twenty eight percent.

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Speaker 10: That's very impressive. And we're not even talking about Wevemo here.

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Speaker 10: So when you look at you know, all the business

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Speaker 10: says they clearly have a lot going on, and Vemo

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Speaker 10: is a future bet, but something that could be huge

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Speaker 10: in terms of you know, top line.

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Speaker 3: You know, it's interesting you just mentioned fifty billion of

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Speaker 3: runwright revenue for YouTube and advertising subscription. That sounds a

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Speaker 3: lot like the cable television business, the cable network business.

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Speaker 3: I look at Paramount, Paramount Global, you know, all those

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Speaker 3: cable networks.

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Speaker 4: They have thirty billion of revenue.

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Speaker 3: So YouTube is significantly bigger than some of the largest

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Speaker 3: advertising and subscription.

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Speaker 4: German media companies out there. Yeah, and in a dozen years,

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Speaker 4: it's just extraordinary.

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Speaker 5: And Meandy, you were talking about these massive investments that

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Speaker 5: Google in Alphabet, obviously the parent company has been trying

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Speaker 5: to catch up to the likes of Obviously Microsoft will

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Speaker 5: get another update from their earnings after the bell and

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Speaker 5: of course open ai walk us through some of those

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Speaker 5: investments and how they're starting to pay off.

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Speaker 10: I mean, look, in the case of Alphabet, they have

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Speaker 10: huge data center investments simply because they have a giant

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Speaker 10: infrastructure that's power you know, these big businesses. So there's

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Speaker 10: a lot of internal consumption of these chips, but also

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Speaker 10: the cloud business, which saw a nice acceleration, you know,

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Speaker 10: sequential acceleration from twenty nine percent growth to thirty five

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Speaker 10: percent growth. I would say a lot of that is

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Speaker 10: driven by the availability of GPUs in their cloud. So

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Speaker 10: I'll be interested in seeing how much of Microsoft GPUs

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Speaker 10: are being used for internal consumption versus what is being

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Speaker 10: exposed on their Azure cloud. Because in my mind, Google

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Speaker 10: having their own chips is making a difference in terms

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Speaker 10: of their cloud growth, and that's why you saw that acceleration.

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Speaker 10: But I'll have to validate that tonight.

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Speaker 3: How is AI impacting John Tuckerman's search results?

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Speaker 10: Right? I mean, just the nature of search is changing

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Speaker 10: in the sense you can ask you know, a lot

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Speaker 10: longer queries. The prompts can be infinite and length. You

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Speaker 10: can you know, have a video or an image prompt.

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Speaker 10: It just doesn't have to be text. So that's what

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Speaker 10: Google called out, that the queries are getting a lot

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Speaker 10: more complex in nature, and users are actually engaging with it,

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Speaker 10: so it's not as if, you know, that's driving them

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Speaker 10: to some of the platform users want to use what

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Speaker 10: they call multimodel search, which is a combination of texts, videos,

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Speaker 10: and images and audios. So that's why these llms are

440
00:22:27,119 --> 00:22:30,800
Speaker 10: so powerful because they give you that innate capability to

441
00:22:31,000 --> 00:22:33,760
Speaker 10: search in whatever format you want and you can just

442
00:22:33,840 --> 00:22:36,639
Speaker 10: throw it in that search box. So that search box

443
00:22:37,000 --> 00:22:39,879
Speaker 10: is getting a lot bigger and a lot more complex

444
00:22:40,320 --> 00:22:41,320
Speaker 10: on that Google page.

445
00:22:41,359 --> 00:22:43,679
Speaker 5: So what do we need to watch for with Microsoft today?

446
00:22:44,200 --> 00:22:47,240
Speaker 10: I mean azure growth. I said, you know, the availability

447
00:22:47,240 --> 00:22:52,119
Speaker 10: of GPUs is what is powering Google clouds acceleration. I

448
00:22:52,240 --> 00:22:56,800
Speaker 10: want to see that acceleration in Microsoft's Azure growth to

449
00:22:56,840 --> 00:23:00,280
Speaker 10: confirm that Microsoft is not losing share to Google or

450
00:23:00,320 --> 00:23:03,560
Speaker 10: for that matter, Amazon. Lich reports on Thursday.

451
00:23:03,119 --> 00:23:04,400
Speaker 4: And tomorrow on surveillance.

452
00:23:04,400 --> 00:23:06,480
Speaker 3: Tomorrow morning, you're going to have Dan ives in studio

453
00:23:06,560 --> 00:23:09,119
Speaker 3: from Red Bush Security, so he'll be doing presumably at

454
00:23:09,400 --> 00:23:10,879
Speaker 3: the victory left for what.

455
00:23:11,000 --> 00:23:12,800
Speaker 4: Can't man deep dress like Dan?

456
00:23:13,400 --> 00:23:15,320
Speaker 5: I was about to bring up the what kind of

457
00:23:15,320 --> 00:23:15,840
Speaker 5: bright colors?

458
00:23:15,880 --> 00:23:18,640
Speaker 3: Dan might be aware tomorrow and deep because it takes

459
00:23:18,680 --> 00:23:22,240
Speaker 3: an effort here. He matches his turbine and deeps to

460
00:23:22,280 --> 00:23:24,000
Speaker 3: sink for those on radio can't see.

461
00:23:24,560 --> 00:23:27,639
Speaker 4: It matches his turban with the suit every day every

462
00:23:28,600 --> 00:23:32,120
Speaker 4: so that is solid. I give him for that, walking

463
00:23:32,200 --> 00:23:34,600
Speaker 4: here with like a pink tie and everything.

464
00:23:34,600 --> 00:23:37,520
Speaker 5: We all know how Paul Sweety is the fashion police here.

465
00:23:37,720 --> 00:23:39,400
Speaker 5: Paul fashe Sweeney.

466
00:23:39,200 --> 00:23:40,720
Speaker 6: Of Bloomberg News.

467
00:23:40,920 --> 00:23:44,199
Speaker 4: There is a dress cook the summer Fridays.

468
00:23:44,240 --> 00:23:46,560
Speaker 5: I remember, I think came in with flip flops and

469
00:23:46,800 --> 00:23:48,200
Speaker 5: they had a stern warning from Paul.

470
00:23:48,480 --> 00:23:51,240
Speaker 4: We all agreed no flip flops in nor place. John,

471
00:23:52,480 --> 00:23:55,960
Speaker 4: although I do have like you know, it's got the cas.

472
00:23:57,480 --> 00:24:00,000
Speaker 3: That's how his casual Tucker gets Man Deep, thank you

473
00:24:00,119 --> 00:24:01,919
Speaker 3: so much. We appreciated Man Deep seeing he covers all

474
00:24:01,960 --> 00:24:05,680
Speaker 3: the technology. He manages all of our technology coverage, great

475
00:24:05,760 --> 00:24:09,680
Speaker 3: stuff for Bloomberg Intelligence, and obviously technology is a global business.

476
00:24:10,080 --> 00:24:12,760
Speaker 3: Asia is such an important part of the technology stories

477
00:24:12,760 --> 00:24:14,520
Speaker 3: in terms of not only an end market, but a

478
00:24:14,560 --> 00:24:15,440
Speaker 3: source for a lot of.

479
00:24:15,359 --> 00:24:16,800
Speaker 4: That technology and manufacturing.

480
00:24:17,600 --> 00:24:20,080
Speaker 3: And we've got a big team out in Asia for

481
00:24:20,160 --> 00:24:22,680
Speaker 3: Bloomberg Intelligence, and Man Deep manages all that for us.

482
00:24:22,680 --> 00:24:24,240
Speaker 4: So he's our go to person.

483
00:24:29,400 --> 00:24:33,320
Speaker 2: You're listening to the Bloomberg Intelligence podcast. Catch us live

484
00:24:33,359 --> 00:24:36,880
Speaker 2: weekdays at ten am Eastern on applecar Play and androyd

485
00:24:36,920 --> 00:24:39,720
Speaker 2: Outo with the Bloomberg Business App. You can also listen

486
00:24:39,840 --> 00:24:42,920
Speaker 2: live on Amazon Alexa from our flagship New York station

487
00:24:43,280 --> 00:24:46,760
Speaker 2: Just Say Alexa playing Bloomberg eleven thirty.

488
00:24:47,080 --> 00:24:51,000
Speaker 3: Let's stick with the topic of politics. Why not because

489
00:24:51,000 --> 00:24:54,080
Speaker 3: we got the election coming up on Tuesday. Here's an

490
00:24:54,080 --> 00:24:57,640
Speaker 3: interesting headline in the Bloomberg terminal, how Puerto Rico became

491
00:24:57,680 --> 00:25:00,760
Speaker 3: an issue in the US election. Lord davids and joins us.

492
00:25:00,760 --> 00:25:03,000
Speaker 3: She's a political editor for Bloomberg News.

493
00:25:03,560 --> 00:25:04,399
Speaker 4: She's done in DC.

494
00:25:04,840 --> 00:25:07,400
Speaker 3: So, Laura, we've heard a lot about Puerto Rico in

495
00:25:07,440 --> 00:25:09,680
Speaker 3: this election, just in the last week or so, can

496
00:25:09,720 --> 00:25:12,240
Speaker 3: you explain to us kind of what's going on why

497
00:25:12,560 --> 00:25:14,080
Speaker 3: it may be important.

498
00:25:15,400 --> 00:25:17,879
Speaker 11: Yeah, So this really kicked off over the weekend at

499
00:25:17,880 --> 00:25:20,760
Speaker 11: Trump's rally at Madison Square Garden, where a comedian who

500
00:25:20,840 --> 00:25:24,000
Speaker 11: was one of the kind of preview speakers before Trump

501
00:25:24,040 --> 00:25:26,480
Speaker 11: came out of the stage made a joke about Puerto

502
00:25:26,560 --> 00:25:29,160
Speaker 11: Rico where he called it a floating island of garbage,

503
00:25:29,680 --> 00:25:31,760
Speaker 11: and that has really picked up a lot of traction.

504
00:25:32,400 --> 00:25:34,240
Speaker 11: You know, it was sort of in the mix of

505
00:25:34,280 --> 00:25:36,920
Speaker 11: all a bunch of other incendiary and racist comments at

506
00:25:36,920 --> 00:25:40,320
Speaker 11: this rally, but also because Puerto Ricans are a particularly

507
00:25:40,359 --> 00:25:44,199
Speaker 11: important voting block, especially in Pennsylvania, and sort of you know,

508
00:25:45,040 --> 00:25:47,239
Speaker 11: not directly connected to this, but it also has been

509
00:25:47,240 --> 00:25:50,199
Speaker 11: a group that both Trump and Harris have had outreach

510
00:25:50,280 --> 00:25:52,440
Speaker 11: too in recent days. The day that that remark was made,

511
00:25:52,480 --> 00:25:55,439
Speaker 11: Harris was at a Puerto Rican restaurant in Pennsylvania. Trump

512
00:25:55,520 --> 00:25:57,680
Speaker 11: just last night was an Allentown, Pennsylvania, which has a

513
00:25:57,720 --> 00:26:01,359
Speaker 11: large Latino population and in Sylvania, yet the whole has

514
00:26:01,400 --> 00:26:03,760
Speaker 11: one of the largest Puerto Rican populations in the country.

515
00:26:03,760 --> 00:26:08,600
Speaker 11: So this was quickly denounced by several people, you know,

516
00:26:08,880 --> 00:26:12,680
Speaker 11: Puerto Ricans, but also you know Republicans that represent Florida

517
00:26:12,800 --> 00:26:15,680
Speaker 11: Senator Rick Scott for example. Even the Trump campaign came

518
00:26:15,720 --> 00:26:18,239
Speaker 11: out and said, look, you know, we didn't approve this,

519
00:26:18,280 --> 00:26:20,440
Speaker 11: We don't you know, support this doesn't represent our views,

520
00:26:20,440 --> 00:26:21,960
Speaker 11: which is not something you see a lot from the

521
00:26:22,000 --> 00:26:22,680
Speaker 11: Trump campaign.

522
00:26:23,080 --> 00:26:25,880
Speaker 5: I wanted to get your thoughts on the latest headlines

523
00:26:25,920 --> 00:26:27,600
Speaker 5: that we had in the past hour about the Supreme

524
00:26:27,680 --> 00:26:31,600
Speaker 5: Court allowing Virginia to purge voters before the election. Walk

525
00:26:31,680 --> 00:26:34,080
Speaker 5: us through what we know so far on this and

526
00:26:34,200 --> 00:26:36,120
Speaker 5: what's the precedence for something like this.

527
00:26:37,480 --> 00:26:40,679
Speaker 11: Yeah, So, at issue are about sixteen hundred voters on

528
00:26:40,720 --> 00:26:45,359
Speaker 11: the Virginia roles which the state has asked to purge.

529
00:26:45,400 --> 00:26:47,639
Speaker 11: They say, look, we think that these are not citizens

530
00:26:47,920 --> 00:26:50,160
Speaker 11: on here, and we want to remove them. There are

531
00:26:50,280 --> 00:26:52,280
Speaker 11: laws in place about you know, how close to an

532
00:26:52,320 --> 00:26:55,200
Speaker 11: election you can get rid of some of these. You know,

533
00:26:55,359 --> 00:26:58,159
Speaker 11: you can change the voter roles. So they petitioned the

534
00:26:58,160 --> 00:27:00,960
Speaker 11: Supreme Court. The Supreme Court today's said yes, you can

535
00:27:01,000 --> 00:27:03,359
Speaker 11: go ahead and remove these people from the voter rules.

536
00:27:03,560 --> 00:27:06,080
Speaker 11: You know, this is not you know, Virginia is not

537
00:27:06,080 --> 00:27:07,760
Speaker 11: expected to be a swing state. Here or be decisive

538
00:27:07,760 --> 00:27:10,560
Speaker 11: in the elections. Sixteen hundred is a relatively small number,

539
00:27:10,640 --> 00:27:13,600
Speaker 11: but this has a lot of election security people worried

540
00:27:13,600 --> 00:27:17,000
Speaker 11: that this could foretell some larger purge in a state

541
00:27:17,040 --> 00:27:20,080
Speaker 11: that could potentially be decisive in either the presidential race

542
00:27:20,200 --> 00:27:23,240
Speaker 11: or you know, any of the contested Senate races.

543
00:27:23,600 --> 00:27:25,200
Speaker 4: Yeah, I have to admit I haven't.

544
00:27:25,240 --> 00:27:27,879
Speaker 3: I can't recall seeing a story like this where this

545
00:27:27,920 --> 00:27:31,040
Speaker 3: has actually occurred. Does this happen with any regularity across

546
00:27:31,119 --> 00:27:34,080
Speaker 3: the country or is this case in Virginia particularly unique.

547
00:27:35,000 --> 00:27:37,040
Speaker 11: This is a sort of a unique thing we're seeing.

548
00:27:37,240 --> 00:27:38,920
Speaker 11: You know, this is something that you know has come

549
00:27:39,000 --> 00:27:42,040
Speaker 11: up in several states, you know, both you know, we've

550
00:27:42,080 --> 00:27:44,600
Speaker 11: seen in Nebraska, for example, they wanted to change their

551
00:27:44,640 --> 00:27:47,919
Speaker 11: rules about how they apportioned their Electoral College votes. You've

552
00:27:47,920 --> 00:27:50,520
Speaker 11: seen some other states them having some some issues about this,

553
00:27:50,600 --> 00:27:53,320
Speaker 11: but generally, you know, either for political reasons or for

554
00:27:53,400 --> 00:27:55,600
Speaker 11: legal reasons, that they states that said, no, we can't

555
00:27:55,640 --> 00:27:57,440
Speaker 11: change things of close to elections. So this is a

556
00:27:57,480 --> 00:27:59,840
Speaker 11: little bit of a surprise this morning from the Supreme Court.

557
00:28:00,880 --> 00:28:02,960
Speaker 5: So when you look at the kind of latest headlines

558
00:28:02,960 --> 00:28:06,959
Speaker 5: coming through the Turnamonal Virginia canceled registrations of estimated sixteen

559
00:28:07,040 --> 00:28:10,600
Speaker 5: hundred residents here. Of course, Donald Trump and Kamala Harris

560
00:28:10,840 --> 00:28:14,640
Speaker 5: will criss cross several string states today, passing each other.

561
00:28:14,680 --> 00:28:17,240
Speaker 5: Of course in Wisconsin when we have less than a

562
00:28:17,280 --> 00:28:19,680
Speaker 5: week to go ahead of election day, what do you

563
00:28:19,720 --> 00:28:21,840
Speaker 5: think is most crucial here when they're pushing through what

564
00:28:21,880 --> 00:28:23,640
Speaker 5: their potential policy proposals are.

565
00:28:24,880 --> 00:28:27,800
Speaker 11: Yeah, so what they're doing now is they have generally

566
00:28:27,800 --> 00:28:29,639
Speaker 11: put out all the policy proposals they have that you

567
00:28:29,680 --> 00:28:32,160
Speaker 11: still have seen Trump start to outline some additional ones

568
00:28:32,160 --> 00:28:35,280
Speaker 11: that he's been sort of grasping for additional votes. But

569
00:28:35,320 --> 00:28:38,640
Speaker 11: they're really framing and honing in on their argument, you know,

570
00:28:38,760 --> 00:28:39,800
Speaker 11: why voters should.

571
00:28:39,520 --> 00:28:39,880
Speaker 10: Vote for them.

572
00:28:39,920 --> 00:28:41,800
Speaker 11: So we saw last night with Harris on the Ellipse,

573
00:28:42,280 --> 00:28:45,080
Speaker 11: she was making an argument about Trump being a danger,

574
00:28:45,120 --> 00:28:47,440
Speaker 11: but you also saw her quickly pivot to talk about,

575
00:28:47,560 --> 00:28:50,840
Speaker 11: you know, sort of her prescriptive view, particularly for the economy.

576
00:28:51,000 --> 00:28:53,000
Speaker 11: We know that that has been one of the key

577
00:28:53,040 --> 00:28:55,720
Speaker 11: issues for voters, really the top issue in this election.

578
00:28:56,160 --> 00:28:58,880
Speaker 11: You've seen Trump really double down on immigration. You know,

579
00:28:58,960 --> 00:29:00,640
Speaker 11: poll show that this is you know, perhaps probably the

580
00:29:00,720 --> 00:29:04,240
Speaker 11: number two issue in this race. But you know, even

581
00:29:04,280 --> 00:29:06,479
Speaker 11: more so than talking about the economy, he's really been

582
00:29:06,480 --> 00:29:09,200
Speaker 11: doubling down on immigration, the threat of migrants, and that's

583
00:29:09,240 --> 00:29:12,280
Speaker 11: sort of why this Puerto Rican comment from over the

584
00:29:12,320 --> 00:29:12,880
Speaker 11: weekend has.

585
00:29:12,800 --> 00:29:15,760
Speaker 4: Really caught fire down in Washington, d C.

586
00:29:15,920 --> 00:29:18,760
Speaker 3: Laura, what's the feeling about some of the down ballot

587
00:29:19,480 --> 00:29:21,720
Speaker 3: races that are key to the control of both the

588
00:29:21,720 --> 00:29:22,440
Speaker 3: House and the Senate.

589
00:29:23,680 --> 00:29:27,280
Speaker 11: Yeah, so there really is a key overlap between some

590
00:29:27,320 --> 00:29:29,440
Speaker 11: of these key Senate races as well as the as

591
00:29:29,520 --> 00:29:31,360
Speaker 11: sort of the battleground state. So you know, we're looking

592
00:29:31,440 --> 00:29:36,200
Speaker 11: at places like Pennsylvania and Michigan and Arizona. Democrats are

593
00:29:36,320 --> 00:29:38,400
Speaker 11: at a disadvantage when it comes to the Senate. They

594
00:29:38,400 --> 00:29:41,320
Speaker 11: are defending a bunch of seats, you know, in places

595
00:29:41,360 --> 00:29:44,400
Speaker 11: like Ohio and Montana that Trump has won and are

596
00:29:44,440 --> 00:29:47,840
Speaker 11: expected to win in a couple in in next week.

597
00:29:48,800 --> 00:29:50,680
Speaker 11: The House is a little bit more of a wild card,

598
00:29:50,760 --> 00:29:54,440
Speaker 11: and because those races aren't really overlapping with the electoral

599
00:29:54,440 --> 00:29:56,920
Speaker 11: college map, it's really New York areas, particularly the New

600
00:29:56,960 --> 00:29:59,360
Speaker 11: York City suburbs, as well as California, sort of the

601
00:29:59,360 --> 00:30:02,240
Speaker 11: southern californi Ornia suburbs around San Diego and Los Angeles

602
00:30:02,280 --> 00:30:05,000
Speaker 11: that will be decisive there. So that's a really close race.

603
00:30:05,000 --> 00:30:06,920
Speaker 11: It really anyone's guess is to you know which way

604
00:30:06,920 --> 00:30:10,360
Speaker 11: the House flips the Senate, your Republicans have an advantage,

605
00:30:10,640 --> 00:30:13,000
Speaker 11: but you know, things could all break in Democrats way

606
00:30:13,000 --> 00:30:15,120
Speaker 11: if they hit every race just right.

607
00:30:15,400 --> 00:30:17,600
Speaker 5: Of course, there's a lot of discussion that we potentially

608
00:30:17,680 --> 00:30:20,720
Speaker 5: might not even know the results of the election that evening,

609
00:30:20,800 --> 00:30:22,200
Speaker 5: kind of similar to what we would have seen in

610
00:30:22,200 --> 00:30:24,640
Speaker 5: twenty twenty. We can get the final results till that

611
00:30:24,720 --> 00:30:27,240
Speaker 5: following weekend on that Saturday. What's kind of when your

612
00:30:27,280 --> 00:30:29,840
Speaker 5: conversations with your sources, are they saying as far as

613
00:30:29,880 --> 00:30:32,400
Speaker 5: what the timetable could be potentially when we would know

614
00:30:32,440 --> 00:30:34,000
Speaker 5: the eventral results.

615
00:30:33,720 --> 00:30:37,040
Speaker 11: Here, Yeah, it's looking like this. We will not have

616
00:30:37,120 --> 00:30:38,120
Speaker 11: results on election night.

617
00:30:38,160 --> 00:30:39,160
Speaker 6: It is possible, but.

618
00:30:39,240 --> 00:30:43,360
Speaker 11: A relatively remote possibility. There are several states, including Pennsylvania,

619
00:30:43,360 --> 00:30:46,040
Speaker 11: that will likely end up being decisive that take a

620
00:30:46,080 --> 00:30:48,520
Speaker 11: little bit longer than average to vote. You know this,

621
00:30:48,680 --> 00:30:51,560
Speaker 11: Each state has different rules about when they can start voting,

622
00:30:51,600 --> 00:30:53,440
Speaker 11: particularly when they can start mail in ballots, when they

623
00:30:53,440 --> 00:30:55,840
Speaker 11: can start tabulating early votes, and sort of all the

624
00:30:55,880 --> 00:30:57,960
Speaker 11: different things they need to do to come to an

625
00:30:58,000 --> 00:31:01,240
Speaker 11: official total, so that really very state by state, And

626
00:31:01,280 --> 00:31:03,160
Speaker 11: of course we also anticipate that there might be legal

627
00:31:03,280 --> 00:31:06,200
Speaker 11: challenges that could either pause the counting or stop the counting,

628
00:31:06,320 --> 00:31:08,640
Speaker 11: or you know, take time for things to work through

629
00:31:08,680 --> 00:31:12,520
Speaker 11: the courts. So it's it's very likely that this will

630
00:31:12,560 --> 00:31:15,320
Speaker 11: be days, potentially weeks if there are you know, several

631
00:31:15,360 --> 00:31:17,840
Speaker 11: hurdles in the states, and it looks to be you know,

632
00:31:17,960 --> 00:31:18,840
Speaker 11: really tight Margins.

633
00:31:19,120 --> 00:31:20,640
Speaker 4: All right, laur thank you so much for joining us.

634
00:31:20,680 --> 00:31:23,520
Speaker 4: Lard Davison. She's a polittle bel editor for Bloomberg News,

635
00:31:24,000 --> 00:31:25,240
Speaker 4: joining us from Washington, DC.

636
00:31:25,440 --> 00:31:28,400
Speaker 3: So again, I think that's going to be really interesting, Jessica,

637
00:31:28,400 --> 00:31:30,840
Speaker 3: and probably very frustrating for a lot of people who

638
00:31:31,280 --> 00:31:32,920
Speaker 3: you know, want to go to bed on election night

639
00:31:32,960 --> 00:31:35,800
Speaker 3: like we used to, knowing kind of who the president

640
00:31:35,920 --> 00:31:36,360
Speaker 3: is going to be.

641
00:31:36,360 --> 00:31:38,280
Speaker 5: But it could be right, it could take days again.

642
00:31:38,280 --> 00:31:40,600
Speaker 3: Yeah, and maybe perhaps even longer, and I don't know,

643
00:31:40,840 --> 00:31:42,920
Speaker 3: you know, I guess that simply just reflects the fact

644
00:31:42,920 --> 00:31:45,320
Speaker 3: that the electorate is so evenly divided.

645
00:31:45,840 --> 00:31:47,440
Speaker 4: Literally our college counts.

646
00:31:47,600 --> 00:31:50,000
Speaker 3: You can't be there at eight o'clock PM and call

647
00:31:50,080 --> 00:31:53,400
Speaker 3: the race, right, I guess at Network news anchor, those

648
00:31:53,440 --> 00:31:54,120
Speaker 3: days are over.

649
00:31:54,640 --> 00:31:56,600
Speaker 5: No, definitely, so it'll be interesting to see how things

650
00:31:56,640 --> 00:31:57,400
Speaker 5: play out over.

651
00:31:57,280 --> 00:31:57,840
Speaker 6: The next week.

652
00:31:58,880 --> 00:32:03,400
Speaker 2: This is the bloomber Surge Intelligence podcast, available on apples, Spotify,

653
00:32:03,600 --> 00:32:06,800
Speaker 2: and anywhere else you get your podcasts. Listen live each

654
00:32:06,840 --> 00:32:10,240
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655
00:32:10,320 --> 00:32:13,720
Speaker 2: the iHeartRadio app tune In, and the Bloomberg Business app.

656
00:32:13,840 --> 00:32:16,840
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657
00:32:17,040 --> 00:32:18,920
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