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Speaker 1: From Mahart where Innovation, Money and power collie in Silicon

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Speaker 1: Valley NBN. This is Bloomberg Technology with Caroline Hyde and

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Speaker 1: Ed Ludlove.

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Speaker 2: Live from New York and San Francisco.

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Speaker 3: This is Bloomberg Technology coming up Microsoft and Meta results

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Speaker 3: drag the market lower. We'll take a deep dive into

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Speaker 3: how the AI story is playing out for them.

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Speaker 4: And door dash posts its first operating profit since the

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Speaker 4: pandemic as it grows outside restaurant deliveries.

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Speaker 1: We speak to the CFO.

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Speaker 3: And we will sit down with Graylock partner and LinkedIn

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Speaker 3: co founder Reed Hoffman to discuss the impact of the

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Speaker 3: election on Silicon Valley. But first we check in on

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Speaker 3: these markets that are to the downside the NASDAC as

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Speaker 3: I shine a light off by more than two percent

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Speaker 3: of this is as the earnings come thick, come fast,

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Speaker 3: and Ed's going to be describing some of the key

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Speaker 3: point contributors to the downside. But I highlight Uber, one

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Speaker 3: of the latest ones out this morning, down the most

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Speaker 3: in two years.

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Speaker 2: Why gross bookings just not as high as market had

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Speaker 2: wanted to see.

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Speaker 3: We're seeing forty one billion dollars for their quarter just reported,

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Speaker 3: but the market wanted to see higher and they wanted

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Speaker 3: a better forecast as well. Is it being crimped back

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Speaker 3: by perhaps a slightly slower growth in the United States.

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Speaker 2: We're seeing California and.

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Speaker 3: New Jersey perhaps pushed back a little bit by the

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Speaker 3: cost of insurance, for example. But also there's an FX

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Speaker 3: headwind that's happening even though we saw record operating profit

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Speaker 3: eds so uber to the downside.

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Speaker 2: What else are you watching on the micro.

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Speaker 4: Basis, Yeah, emphasis on forecast when it comes to the

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Speaker 4: megacaps and members of the mag seven that reported Meta

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Speaker 4: narrowly beaten the quarter gone on the advertising business, but

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Speaker 4: it's warning of greater losses in reality labs as it

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Speaker 4: continues to invest in AI and capital expenditures growth into

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Speaker 4: twenty twenty five. Microsoft is similar story. In fact, the

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Speaker 4: stocks down by the most or on track to be

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Speaker 4: dropped by the most since October of twenty twenty two,

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Speaker 4: as your growth in the next three month period will

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Speaker 4: be thirty one to thirty two percent, but that's a

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Speaker 4: declined sequentially from the thirty four percent in the court

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Speaker 4: of just Gone. Unbelievably, they're saying that their supply constrained

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Speaker 4: or capacity constrained on the data center side.

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Speaker 2: In other words, they.

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Speaker 4: Don't have the compute capacity needed to meet the demand

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Speaker 4: that's out there for AI, which is like a really

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Speaker 4: fascinating predicatiment to be in there. But also record spending

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Speaker 4: right in the course just gone. The themes are quite consistent.

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Speaker 3: Carroc, the themes are and so is the movement across

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Speaker 3: most of the market. Let's bring in bloomberg'sjes menton who

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Speaker 3: helps really focus in on a drag lower for the

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Speaker 3: NASDAC and all eyes really have been on AI capacity

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Speaker 3: and AI spending.

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Speaker 5: That's right, and especially with Microsoft because they've ramped up

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Speaker 5: so much spinning, and especially I know you cover the

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Speaker 5: data center's focused as well, because that's not.

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Speaker 2: Something typically a company.

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Speaker 5: Like Microsoft would have done, say before twenty twenty, but

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Speaker 5: especially especially if you think about the utility stocks have

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Speaker 5: been taken off those types of tie to the data

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Speaker 5: center biness. But that's really where it is when you're

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Speaker 5: thinking about the CAPEC spending, not just for Microsoft, when

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Speaker 5: it comes to these other companies too, because even say

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Speaker 5: if you're looking over at Meta Mark Zuckerberg made it

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Speaker 5: clear they're still going to keep up that spending for

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Speaker 5: AI even though you're starting to see that is quite

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Speaker 5: of a boost there too when it comes to sales

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Speaker 5: tied to those types of AI losses there, but also

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Speaker 5: when you're thinking about we still have in a video

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Speaker 5: coming up for it's still a few weeks away, so

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Speaker 5: it's November twentieth, but when you think about its core

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Speaker 5: key clients here when it comes to AI spending and

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Speaker 5: what it means, I mean, they're all reporting this week,

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Speaker 5: so we already heard from Alphabet, obviously, we had Microsoft

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Speaker 5: and of course Meta, and then we'll have Amazon after

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Speaker 5: the bell. But with them raping up spending, that obviously

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Speaker 5: is going to boilde well for Nvidia, and when you

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Speaker 5: think about nearly half of its revenue growth when it

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Speaker 5: comes to those types of addison.

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Speaker 4: Yes, let me jump in here.

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Speaker 5: Though.

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Speaker 4: Really interesting, we're showing in videos down four percent or

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Speaker 4: more than right in video right And what's so interesting

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Speaker 4: is that second biggest points drag on the Nasdaq one

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Speaker 4: hundred and maybe the logic here is that Microsoft one

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Speaker 4: of the biggest buyers of invidious chips along with Meta,

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Speaker 4: their growth outlooks are disappointing. So even though they're both

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Speaker 4: saying we are committed to spending on AI if they

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Speaker 4: can't sustain the growth that investors want to see in

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Speaker 4: response to that, maybe those plans change. I just think

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Speaker 4: that's so interesting to see that name down significantly despite

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Speaker 4: its biggest customers saying yeah, we're going to spend money

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Speaker 4: on them, no worries.

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Speaker 5: Well, a lot of that also has to do because

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Speaker 5: the lingering concerns about the black wall chips, and especially

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Speaker 5: when you think of product delays and it's long term

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Speaker 5: growth prospects. So a lot of that really is tied

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Speaker 5: there to your point as far as what that means

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Speaker 5: and as far as how long can some of these

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Speaker 5: companies continue to ramp up that spending because we normally

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Speaker 5: haven't seen that, Like I mentioned, when it comes to something.

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Speaker 4: Like Microsoft astonishing gains going into earnings. It's an amazing

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Speaker 4: and interesting market session, and we have Bloomberg's Jesmentum, we're

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Speaker 4: grateful for it. Thank you. Let's get the cell side

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Speaker 4: reaction and bring in Sweater Cajuria, Managing director for Global

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Speaker 4: Internet at Wolf Research, And I think we've got to

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Speaker 4: start with Meta. It's a really interesting company to understand

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Speaker 4: because beaten, the care to gone, the social media advertising

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Speaker 4: supported business reality labs will see greater losses. Capital expenditures

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Speaker 4: will continue to grow. I've got a really big sense

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Speaker 4: of deja vu. I don't know about you, Schweta, but

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Speaker 4: what was your takeaway from that?

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Speaker 6: Yeah, well, first of all, thanks for having me ed,

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Speaker 6: it's good to be here. My takeaway was that there

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Speaker 6: are a lot of good things that are going on

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Speaker 6: for Meta and if we think about at a high level, yes,

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Speaker 6: on the negative side, gapex remains unclear. They'll probably spend

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Speaker 6: maybe fifty to sixty billion dollars in gapex next year.

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Speaker 6: We'll see when they guide, but that's a pretty big number.

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Speaker 6: And the losses in reality labs, certainly to your point,

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Speaker 6: is a concern. But on the flip side, what they

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Speaker 6: are doing in terms of how they are leveraging LAMA,

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Speaker 6: which I believe is a stroke of genius on their

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Speaker 6: part to their own advantage, is amazing. Especially as we

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Speaker 6: think about engagement and monetization. Video recommendations alone are driving

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Speaker 6: mid to high single dige percentage growth on time spent

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Speaker 6: impression growths are highcing gole digit pricing is improving eleven

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Speaker 6: percent for them and so and METAAI already has five

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Speaker 6: hundred million mus and so the engagement on the platform

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Speaker 6: is remarkable, and what they are trying to do is

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Speaker 6: continue to be able to monetize on a go forward basis.

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Speaker 6: So we expect their revenue growth to be sustained that

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Speaker 6: you know, call it mid team's growth rate even at

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Speaker 6: current levels. And they are probably one of the biggest

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Speaker 6: beneficiaries of deploying AI for their own advantage.

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Speaker 3: I mean, not half a billion monthly active use as

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Speaker 3: a metter AI was arresting, but what arrested the market

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Speaker 3: was the twenty twenty five promise to spend.

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Speaker 2: Just take a listen to what Mark Zuckerbag said on

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Speaker 2: the core.

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Speaker 7: First, it's clear that there are a lot of new

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Speaker 7: opportunities to use new AI advances to accelerate our core

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Speaker 7: business that should have strong ROI over the next few years.

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Speaker 7: So I think we should invest more there. And second

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Speaker 7: are AI and continue to require serious infrastructure, and I

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Speaker 7: expect to continue investing significantly there too.

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Speaker 3: So in your note Shretter, you talk about the new opportunities,

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Speaker 3: the new revenue avenues that we're going to see. What

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Speaker 3: are they articulate that for the market.

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Speaker 6: Sure, well, in the nearer mid term it is leveraging

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Speaker 6: these AI, the AI models and LAMA to their own

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Speaker 6: advantage around engagement and monetizations, so they are making their

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Speaker 6: recommendations better. An example would be unified videos. They're making

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Speaker 6: a full screen video on their platforms across their apps,

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Speaker 6: and that's going to drive engagement because it's live videos,

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Speaker 6: short form videos, differentiated videos, all on one platform on

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Speaker 6: a full screen, and that itself has opportunity to increase

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Speaker 6: supply in terms of ad impressions in that format. In

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Speaker 6: addition to that, they're using AI to make those recommendations

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Speaker 6: more targeted and they have not really untapped that opportunity

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Speaker 6: as much advantage, which plus is what grew their growth

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Speaker 6: in twenty twenty four. In twenty twenty five is most

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Speaker 6: likely going to be video recommendation platform and their video

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Speaker 6: feed That will probably drive their advertising growth in the

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Speaker 6: mid to long term. There are several other revenue sources

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Speaker 6: that they never had before. For example, business to business

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Speaker 6: messaging on WhatsApp that's probably two years out, but they're

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Speaker 6: already monetizing that, and then beyond two years Meta AI

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Speaker 6: in terms of adding advertising to their search feeds on

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Speaker 6: Meta ai in addition to subscription. Just like Chad GPT

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Speaker 6: or Gemini are completely new revenue sources for them.

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Speaker 4: And they continue to see early surprise success with ray

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Speaker 4: van Metas the Glasses and Swetter. You do not cover Microsoft,

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Speaker 4: but you do follow Alphabet, the parent of Google and

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Speaker 4: Amazon that reports after the bell and in the context

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Speaker 4: of cloud, I look at what Alphabet said and last

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Speaker 4: night Microsoft both seeming to suggest that the number three

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Speaker 4: and two players took market share from Aws, Amazon the

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Speaker 4: number one player. Do you go into Amazon's earning tonight

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Speaker 4: with that analysis as well?

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Speaker 6: Absolutely, I mean the top three players in the market

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Speaker 6: are Amazon's AWS, Azure and Google Cloud. What we also

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Speaker 6: saw with Google Cloud because I do cover it is

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Speaker 6: thirty five percent cloud growth rate and in part driven

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Speaker 6: by them not only gaining share, but also part of

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Speaker 6: expanding markettam, which is their AI services and products are

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Speaker 6: really driving that growth. If we look at their ten

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Speaker 6: Q and the backlog, the demand rends that they're seeing

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Speaker 6: are pretty amazing. So going into Amazon's print, our expectation

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Speaker 6: is that Amazon's AWS Cloud revenue likely grew twenty to

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Speaker 6: twenty one percent, and the streets looking for nineteen percent

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Speaker 6: growth rate. That's our expectation and we expect that to

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Speaker 6: accelerate in the fourth quarter.

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Speaker 3: You have an outperform writing on Amazon allies in that

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Speaker 3: after the ball Schwartzek.

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Speaker 2: Great to have you of Wolf Research coming up.

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Speaker 3: DoorDash remarks a major milestone since launching its IPO. The

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Speaker 3: CFO Rabi Uconda joins us. Next, this is Blueberg Technology

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Speaker 3: Time now for talking tech. First up, It's official the

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Speaker 3: EU is investigating e commerce platform Temu for potentially violating

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Speaker 3: the Digital Services Act. Now, the commission suspects that the

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Speaker 3: company is not doing enough to combat sales of illegal

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Speaker 3: products on its site.

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Speaker 2: Meanwhile, Elon Musk.

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Speaker 3: Was sued by the Philip Philadelphia District Attorney of his

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Speaker 3: political action committees one million a day sweepstakes targeting swing

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Speaker 3: state voters. Now the DA is asking a state court

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Speaker 3: to stop Musk from engaging in what it calls an

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Speaker 3: unlawful lottery. And Pelton has tapped Ford executive Peter Stern

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Speaker 3: as its new CEO. The fitness brand has struggled to

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Speaker 3: lose profitability since the pandemic. Ford Hardston last year to

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Speaker 3: run a newly created technology focused division of the automaker

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Speaker 3: ed Okay.

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Speaker 4: Door Dash has topped Wall Street expectations in nearly every

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Speaker 4: key metric. This earning season seeing its first quarterly operating

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Speaker 4: profit since the start of the pandemic, generating one hundred

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Speaker 4: and seven million dollars in operating income. And really it's

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Speaker 4: a story about an app or platform that's shifted from

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Speaker 4: restaurant deliveries to so much moreh CFO Rave in a

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Speaker 4: Conda is with us here in San Francisco. Let's just

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Speaker 4: focus on the future. So that was the story, right,

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Speaker 4: that what's happening is success in other business lines. But

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Speaker 4: so many interested about this long term future of door Dash.

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Speaker 4: You hinted there would be long term investments in new areas.

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Speaker 1: What are they sure?

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Speaker 8: We started our business with the restaurants as the core focus,

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Speaker 8: but today we are so much more than restaurants. Consumers

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Speaker 8: have it an all time high. More consumers are ordering

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Speaker 8: from more categories. It's grocery, its retail, it's Halloween costumes.

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Speaker 8: We are partnering with every single store in your local neighborhood.

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Speaker 8: Our goal is to be your local neighborhood superstore.

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Speaker 4: Which areas are the most profitable potentially business lines for

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Speaker 4: the app.

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Speaker 8: The overall business has been gap profitable now for the

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Speaker 8: first time as a public company. The way we think

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Speaker 8: about it is we are trying to build scale in

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Speaker 8: our business. Scale is the most important thing because scale

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Speaker 8: drives efficiency, which ultimately drives profitability in the business. If

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Speaker 8: you look at our restaurants business that has been profitable

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Speaker 8: for a few years, we're taking the profitability and building

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Speaker 8: our new categories business as well as our international business.

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Speaker 3: Let's just talk about international because you made acquisitions there

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Speaker 3: and I'm interested as to how the consumers stack up

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Speaker 3: US versus international consumer.

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Speaker 8: Right now, RABI International is seeing very good and strong growth.

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Speaker 8: The growth has been substantially faster than peers. We're gaining

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Speaker 8: share virtually in every country that we operate in. All

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Speaker 8: of that is being driven by the underlying product innovation.

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Speaker 8: Users are growing, order frequencies growing. We launched World Plus,

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Speaker 8: our subscription program in international markets, and that's off to

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Speaker 8: our flying start.

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Speaker 2: What's interesting is.

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Speaker 3: You're doing partnerships here in the US.

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Speaker 2: It is with lift.

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Speaker 3: How integral is that sort of a partnership for growing

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Speaker 3: your user base, which, of course your CEO is saying,

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Speaker 3: you're still only a single digit fraction of the overall

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Speaker 3: restaurant industry.

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Speaker 8: We're excited by the partnership with Lyft. We think it's

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Speaker 8: an opportunity for us to make dash Pass even more valuable.

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Speaker 8: We have over eighteen million plus subscribers that have saved

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Speaker 8: over ten billion dollars globally. Partnerships like this make it

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Speaker 8: a little bit more attractive, help our consumers save even more.

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Speaker 8: But the core focus continues to be to improve the platform.

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Speaker 8: That's where we see still the majority of the growth

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Speaker 8: for us.

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Speaker 4: You know, Rabi combining right hailing with delivery of food

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Speaker 4: and groceries sounds a lot like what Uba does, but

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Speaker 4: there's an interesting analysis to be done why you're friving.

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Speaker 4: But Uber also printed results that showed the consumer is

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Speaker 4: a little bit tepid right now in the right hailing

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Speaker 4: context in this gig economy world. Why is it that

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Speaker 4: you're succeeding in the here and now?

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Speaker 8: We have so much more than restaurants. I'll give you

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Speaker 8: a small example. Just a couple of months ago, we

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Speaker 8: were running late for back to school. We use DoorDash

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Speaker 8: for back to school supplies for both of our kids.

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Speaker 1: Okay, we want to.

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Speaker 8: Take away the worry of having a to do list.

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Speaker 1: We want DoorDash to be.

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Speaker 8: Your local commerce to do list. Local commerce is a

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Speaker 8: large opportunity. Delivery is the most frequent use case people

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Speaker 8: need at local stores. People order from local stores more

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Speaker 8: than any other activity, and we are the leaders in

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Speaker 8: that space. We are providing selection, We're bringing the best

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Speaker 8: of local neighborhoods to your doorstep.

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Speaker 3: Let's just talk a little bit more about the geography

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Speaker 3: of where you want to be expanding. I mean, is

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Speaker 3: it about spending power a geography when it comes to

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Speaker 3: a deal like the one that we see with Lift,

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Speaker 3: and how do you then extrapolate that to potentially international

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Speaker 3: geography growth as well.

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Speaker 8: We operate in over thirty countries, and the interesting thing

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Speaker 8: is even in all the countries that we operate in,

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Speaker 8: we're not in all the cities. Our focus continues to

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Speaker 8: be to build the best product possible, not just for consumers,

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Speaker 8: but merchants as well as dashers. We just announced a

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Speaker 8: product we call Commerce Platform for our merchants, which continues

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Speaker 8: to do really well. Even in the US, we are

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Speaker 8: the fastest growing from a grocery perspective. We're gaining share

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Speaker 8: compared to peers. Our goal is to expand to all

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Speaker 8: things within local commerce, within all the countries that we operate.

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Speaker 4: In your technology company. You just talk us about your business.

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Speaker 4: Why give me one reason why it helps you stand out.

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Speaker 4: You're very good at that, maybe others on.

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Speaker 8: There's three legs to the stool of growth that we

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Speaker 8: think about. It's selection, it's quality, it's affordability. It's not

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Speaker 8: one or the other. It's a combination of all three

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Speaker 8: things that consumers are looking and asking for. And we're

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Speaker 8: driving same store sales growth for merchants. Over seven million

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Speaker 8: dashers have dashed with us in the last year, earning

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Speaker 8: over fifteen billion, and we are the fasts going from

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Speaker 8: an overall consumer footprint perspective as well.

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Speaker 3: Rabbi, we want to thank you for coming in spelling

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Speaker 3: out the learnings and the potential door dash Cfo Ravi

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Speaker 3: in Acondo there. Meanwhile, coming up, I'm going to be

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Speaker 3: speaking with the Twilio CEO coming up next on the

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Speaker 3: heels of the company's quarterly earnings report and what are

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Speaker 3: you looking at in tess of earnings?

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Speaker 4: So really quick check on eBay stockdown more than eight

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Speaker 4: percent as a familiar story. The forecast for that key

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Speaker 4: holiday period was lackluster, and you know, I think It's

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Speaker 4: an interesting one because we're just talking about door Dash

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Speaker 4: and Uber and this key final three months of the year.

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Speaker 4: Everyone is giving us different as signals about consumer behavior,

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Speaker 4: but investors do not like what eBay is saying about

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Speaker 4: its marketplace and platform. We'll keep tracking it. This has

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Speaker 4: been most technology cloud communications player. Twilio's third quarter earnings

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Speaker 4: beat all street estimates and the company has now raised

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Speaker 4: its full year revenue outlook. Here with more Twilio CEO

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Speaker 4: Cozama Ship Chandler turnaround plan seems to be working, Margins

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Speaker 4: are improving. There's been this call ay structuring since you

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Speaker 4: came in as CEO or jump to CEO, which bit

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Speaker 4: is working best?

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Speaker 9: Yeah, I wouldn't call it a restructuring.

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Speaker 10: I would say it's steady progress, really good financial discipline,

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Speaker 10: operating rigor, a lot of innovation focus. And I think

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Speaker 10: what you're starting to see is that show up in

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Speaker 10: terms of accelerated growth, and I think increasingly we're starting

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Speaker 10: to become a beneficiary of this AI wave.

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Speaker 4: Let's expand on the innovation. Part of the blackstory you

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Speaker 4: know with Twilio was investors who really want to see

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Speaker 4: sort of discipline and a growth plan. But you're doing

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Speaker 4: things in the world of technology that matter.

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Speaker 9: Yeah, I mean, I think you're starting to see margins.

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Speaker 10: Really improve over the last several years, which I think

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Speaker 10: has been exciting for investors, certainly been exciting for us.

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Speaker 10: I think on top of that, though, we've also seen

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Speaker 10: a real return to innovation. So we're making some really

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Speaker 10: focused bets in terms of where that innovation lies. And

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Speaker 10: for us, it's really about delivering for consumers Visa VR

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Speaker 10: customers personalization at scale, and what that really means is

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Speaker 10: how do we combine communications plus contextual data plus AI

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Speaker 10: to deliver these amazing consumer experiences through digital interactions.

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Speaker 4: Because the magic of television. Your IFB's popped out, feel

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Speaker 4: free to pop it back in. And I'll point out

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Speaker 4: that a lot of the cell side analysts have raised

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Speaker 4: price targets on this idea. I think they see a

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Speaker 4: clearer future just very quick. So I want carry to

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Speaker 4: come in. I think that's fair. There's a clear longer

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Speaker 4: term coffee.

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Speaker 10: Yeah, I do think so, and I think we feel

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Speaker 10: pretty optimistic about our long term growth ambitions. Obviously, we

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Speaker 10: want to balance our ability to grow the company as

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Speaker 10: well as drive ongoing profitability and free cash flow and

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Speaker 10: finding that balance really is the trick.

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Speaker 9: But as I look out.

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Speaker 10: And see what's happening in sort of this age of AI,

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Speaker 10: I think we're going to be one of the real beneficiaries.

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Speaker 3: Let's talk about monetizing that AI cousmurf. You can hear

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Speaker 3: me well, because Morgan Stanley says, look, it's encouraging this

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Speaker 3: AI product integration, but they want to see the monetization.

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Speaker 2: How do you turn that on?

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Speaker 10: I mean, I think the way that it happens is

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Speaker 10: is that we've got this great data asset that we

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Speaker 10: bought several years ago in Segment, and on kind of

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Speaker 10: a standalone basis, it's a relatively small piece of our revenue.

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Speaker 10: But the long term play here is is that what

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Speaker 10: Segment does is extract contextual data out of the businesses

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Speaker 10: that we serve and our ability to combine that with

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Speaker 10: communications capabilities and then use a little bit of a

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Speaker 10: to create that awesome consumer outcome on the other side.

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Speaker 9: Like, that's really what we're going for, And.

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Speaker 10: What it kind of means is is that whether it's you,

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Speaker 10: whether it's the two of us, or whether it's thousands

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Speaker 10: of other consumers all at the same time, us being

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Speaker 10: able to achieve that personalization as if a business knows

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Speaker 10: every single thing about us in the way that they

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Speaker 10: interact with us.

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Speaker 9: That's what we unlock.

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Speaker 3: It's really interesting you bring up that segment part because

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Speaker 3: that was the area of the business that activist investors

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Speaker 3: wanted you to shirk to sell off. There is still

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Speaker 3: some weakness within it. Are you standing by the decision

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Speaker 3: to keep it as part of Twilio and how do

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Speaker 3: you tell that story going forward?

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Speaker 10: Yeah, I mean, look, I think we've made progress in

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Speaker 10: that business. We made a number of commitments at the

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Speaker 10: start of the year in terms of what we intended

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Speaker 10: to do to improve the ongoing performance of that business.

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Speaker 10: We're very much on track to get that business to

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Speaker 10: break even. We've made a number of improvements in the

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Speaker 10: go to market capacity of that business. It's not like

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Speaker 10: our work has done yet, it's still kind of continues

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Speaker 10: to pace. Again, I think it's important to remember that

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Speaker 10: it's really less than seven percent of our revenues overall,

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Speaker 10: and so when you consider it in the totality of Twilio,

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Speaker 10: the business growth is reaccelerating, the margins have been fantastic,

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Speaker 10: free cash flows have been activating, and now segment really

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Speaker 10: becomes an activation engine for AI using data and communications.

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Speaker 4: Because the stock is up fifteen percent, on track for

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Speaker 4: his biggest jump since twenty twenty two, at one point,

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Speaker 4: biggest jump since twenty twenty. I know that this is

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Speaker 4: a technology show and that many executives on it are

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Speaker 4: very disciplined about talking about the stock. But the market's

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Speaker 4: rewarding you here. What do you make of it?

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Speaker 10: Look, I think we're making steady progress right and we're

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Speaker 10: not necessarily focused on the day to day movement of

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Speaker 10: the stock price. I think this is the long game

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Speaker 10: that we're fundamentally playing here, and I think the age

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Speaker 10: of AI is going to play out for a long

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Speaker 10: time to come.

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Speaker 9: That's what we're excited about.

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Speaker 10: How can we deliver for customers in a very personalized way,

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Speaker 10: again using communications plus contextual data plus AI to deliver

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Speaker 10: those amazing consumer outcomes.

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Speaker 3: Twillio, CEO Kozumership Chandler, thanks for joining us today on

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Speaker 3: the numbers. Welcome back to BlueBag Technology. I'm Caroline Hide

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Speaker 3: in New York, kind of ed.

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Speaker 2: Lovelo in San Francisco.

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Speaker 4: In terms of earnings and markets, car I'm going to

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Speaker 4: go to some of the crypto related stocks because there's

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Speaker 4: a lot to fit in. So coin based missed estimates

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Speaker 4: essentially in the quarter gone. And what they're talking about

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Speaker 4: is we're entering election week, there is volatility and crypto

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Speaker 4: assets and markets tied to that, but it's not really

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Speaker 4: clear whether they're going to benefit or not. We'll continue

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Speaker 4: to track it. Micro Strategy again, it's a name that

441
00:22:43,320 --> 00:22:45,760
Speaker 4: holds bitcoin in particular on its balance sheet and has

442
00:22:45,800 --> 00:22:48,639
Speaker 4: pledged to buy more bitcoin but saw a loss in

443
00:22:48,680 --> 00:22:51,000
Speaker 4: the quarter. Were one of the first companies to do that,

444
00:22:51,080 --> 00:22:54,240
Speaker 4: by the way. And when we think about bitcoin volatility, yes,

445
00:22:54,280 --> 00:22:56,920
Speaker 4: but still above seventy thousand dollars per token. Then there's

446
00:22:56,920 --> 00:22:59,960
Speaker 4: the megacaps. Much to discuss with them.

447
00:23:00,200 --> 00:23:02,920
Speaker 3: So much on the megacaps. Let's talk about Microsoft earnings.

448
00:23:02,960 --> 00:23:05,240
Speaker 3: You want to get back to it because it underwhelmed

449
00:23:05,240 --> 00:23:08,399
Speaker 3: the forecast for growth from as you're perhaps letting the

450
00:23:08,440 --> 00:23:10,240
Speaker 3: market down somewhat in terms of growth.

451
00:23:10,240 --> 00:23:13,600
Speaker 2: But Microsoft CEO Sati and Adella is continuing to talk.

452
00:23:13,520 --> 00:23:15,600
Speaker 3: Up the company's AI business on the earning school at

453
00:23:15,640 --> 00:23:16,720
Speaker 3: least just take a listen.

454
00:23:18,080 --> 00:23:18,640
Speaker 1: All up.

455
00:23:18,800 --> 00:23:22,360
Speaker 11: Our AI business is on track to surpass an annual

456
00:23:22,440 --> 00:23:26,120
Speaker 11: revenue run rate of ten billion dollars next quarter, which

457
00:23:26,160 --> 00:23:28,760
Speaker 11: will make it the fastest business in our history to

458
00:23:28,800 --> 00:23:31,040
Speaker 11: reach this milestone.

459
00:23:31,600 --> 00:23:32,560
Speaker 2: He's got big talk.

460
00:23:32,640 --> 00:23:34,920
Speaker 3: Let's analyze it with the BLUEBG intelligence Senior and this

461
00:23:35,080 --> 00:23:37,600
Speaker 3: manly saying Microsoft is such an interesting one.

462
00:23:37,440 --> 00:23:39,040
Speaker 2: Because the cores look great.

463
00:23:39,119 --> 00:23:41,560
Speaker 3: They're seeing as your growth back at thirty four percent,

464
00:23:41,560 --> 00:23:43,960
Speaker 3: and then the forecast was a little bit weaker and

465
00:23:44,000 --> 00:23:45,920
Speaker 3: it seems to be a capacity that's limited.

466
00:23:45,960 --> 00:23:46,960
Speaker 2: Here would you make of it?

467
00:23:47,400 --> 00:23:50,040
Speaker 12: Well, so look at the Google Cloud growth and all

468
00:23:50,080 --> 00:23:53,399
Speaker 12: these vendors are growing. You know, the core business is

469
00:23:53,400 --> 00:23:56,119
Speaker 12: growing north of twenty percent. When you take out the

470
00:23:56,200 --> 00:23:59,359
Speaker 12: AI element. In the case of Google Cloud, we saw

471
00:24:00,040 --> 00:24:02,720
Speaker 12: the growth accelerate to thirty five percent and that was

472
00:24:02,760 --> 00:24:05,760
Speaker 12: all powered by AI. In the case of Microsoft, they

473
00:24:05,920 --> 00:24:09,359
Speaker 12: did some resegmenting, so they took out some portion and

474
00:24:09,440 --> 00:24:11,960
Speaker 12: it's not a very clean number to see. Okay, AI

475
00:24:12,040 --> 00:24:15,719
Speaker 12: contribution was twelve percentage points, and that's where you know

476
00:24:16,400 --> 00:24:20,040
Speaker 12: whether it's behind Google Cloud. It's not very clear because

477
00:24:20,040 --> 00:24:23,240
Speaker 12: of the resegmenting. But net Net, you know, they called

478
00:24:23,359 --> 00:24:27,159
Speaker 12: out GPUs supply shortages when your capex is growing up

479
00:24:27,200 --> 00:24:29,679
Speaker 12: fifty percent, and that's where you have to ask for yourself,

480
00:24:29,800 --> 00:24:32,199
Speaker 12: what is the CAPEX being spent on then if you

481
00:24:32,240 --> 00:24:35,560
Speaker 12: don't have enough GPUs, are they spending more on facilities?

482
00:24:35,640 --> 00:24:38,560
Speaker 12: And you know it's hard to parse that out, but

483
00:24:39,040 --> 00:24:42,240
Speaker 12: Google didn't call that out, so you know, it'll be

484
00:24:42,280 --> 00:24:45,080
Speaker 12: interesting to see what Amazon does tonight in terms of

485
00:24:45,200 --> 00:24:49,080
Speaker 12: you know, their n radio allocation and how they are

486
00:24:49,119 --> 00:24:51,879
Speaker 12: framing you know, the capacity shortages when it comes to

487
00:24:51,920 --> 00:24:54,800
Speaker 12: the advanced accelerators. But that's what it comes down to,

488
00:24:55,000 --> 00:24:58,960
Speaker 12: is how much capacity do you have available for external

489
00:24:59,080 --> 00:25:02,600
Speaker 12: use versus what is open AI consuming internally for training?

490
00:25:03,640 --> 00:25:05,720
Speaker 4: A lot of that is geared towards the enterprise business,

491
00:25:05,800 --> 00:25:09,240
Speaker 4: right Mandy. Even with Microsoft, this is a company that's

492
00:25:09,240 --> 00:25:13,280
Speaker 4: been wonderful. It's selling software to consumers as well, particularly

493
00:25:13,359 --> 00:25:16,720
Speaker 4: software that sometimes you can get for free on other platforms.

494
00:25:17,080 --> 00:25:20,119
Speaker 4: Did you get any sense of the trajectory of consumer

495
00:25:20,160 --> 00:25:23,959
Speaker 4: adoption for these kind of AI Improved Office three sixty

496
00:25:24,040 --> 00:25:25,160
Speaker 4: five and products like.

497
00:25:25,119 --> 00:25:27,320
Speaker 1: That, I mean, very unlikely.

498
00:25:27,359 --> 00:25:29,960
Speaker 12: I don't think they want to focus on consumer right

499
00:25:29,960 --> 00:25:32,400
Speaker 12: now because the enterprise opportunity is so big.

500
00:25:32,440 --> 00:25:33,400
Speaker 13: And they called out you.

501
00:25:33,359 --> 00:25:38,439
Speaker 12: Know, separate products Copilot, Copilot, Studio, Agent studio, so they

502
00:25:38,440 --> 00:25:41,639
Speaker 12: are creating you know that bundle that Microsoft is so

503
00:25:41,760 --> 00:25:44,360
Speaker 12: good at selling, and I'm sure they'll get a lot

504
00:25:44,359 --> 00:25:48,400
Speaker 12: of traction. But in terms of separate AI contribution, which

505
00:25:48,440 --> 00:25:51,920
Speaker 12: is what I think Meta got penalized for last night,

506
00:25:52,040 --> 00:25:55,480
Speaker 12: is not having that separate AI contribution even though it's

507
00:25:55,480 --> 00:25:58,840
Speaker 12: getting reflected in their family of apps. That's what investors

508
00:25:58,840 --> 00:26:01,600
Speaker 12: are focused on because the topics increases are so big,

509
00:26:01,800 --> 00:26:05,119
Speaker 12: and these companies keep calling out skialing was so you know,

510
00:26:05,160 --> 00:26:08,119
Speaker 12: you have to find that ceiling. How much will their

511
00:26:08,160 --> 00:26:09,320
Speaker 12: cabex keep going up?

512
00:26:09,880 --> 00:26:12,720
Speaker 3: Need the transparency you help bring it. Bloomberg Intelligence Senior

513
00:26:12,800 --> 00:26:20,840
Speaker 3: analyst Mandat Singh.

514
00:26:23,119 --> 00:26:26,560
Speaker 4: As the election approaches, leading voices in technology and the

515
00:26:26,600 --> 00:26:29,359
Speaker 4: bench capital industry on both sides are throwing their weight

516
00:26:29,400 --> 00:26:32,720
Speaker 4: behind their preferred candidates, like Elon Musk appearing at a

517
00:26:32,800 --> 00:26:36,400
Speaker 4: Donald Trump rally just this past weekend. Today on Bloomberg Technology,

518
00:26:36,440 --> 00:26:38,439
Speaker 4: we're going to speak with Reid Hoffman. You perhaps know

519
00:26:38,560 --> 00:26:41,679
Speaker 4: him best as the co founder of LinkedIn, but the

520
00:26:41,680 --> 00:26:44,280
Speaker 4: billionaire and investors also part of a group of Silicon

521
00:26:44,359 --> 00:26:48,080
Speaker 4: Valley investors that are immersed in this presidential election, rallying

522
00:26:48,080 --> 00:26:51,280
Speaker 4: behind his or their favorite candidate in the race.

523
00:26:51,480 --> 00:26:52,360
Speaker 1: Kamala Harris.

524
00:26:52,760 --> 00:26:55,200
Speaker 4: Reid Hoffman joins US now and read thank you for

525
00:26:55,240 --> 00:26:59,280
Speaker 4: your time in coming on Bloomberg Technology. You know, the

526
00:26:59,560 --> 00:27:01,760
Speaker 4: pitch and the place is to keep this focused on tech.

527
00:27:02,359 --> 00:27:05,240
Speaker 4: So I would like to ask you why is Kamala

528
00:27:05,320 --> 00:27:09,720
Speaker 4: Harris the best candidate for the technology industry and bench

529
00:27:09,800 --> 00:27:11,439
Speaker 4: capitalists around the US.

530
00:27:13,640 --> 00:27:17,040
Speaker 14: Well, So, what the tech industry needs is kind of

531
00:27:17,040 --> 00:27:20,560
Speaker 14: a stable environment in order to you know, kind of

532
00:27:20,680 --> 00:27:24,119
Speaker 14: follow the rules and prosper in an ability because, by

533
00:27:24,160 --> 00:27:25,960
Speaker 14: the way, one of the things that the tech industry

534
00:27:25,960 --> 00:27:28,000
Speaker 14: brings to the US is a kind of a It's

535
00:27:28,040 --> 00:27:31,119
Speaker 14: one of our most successful global industries where most of

536
00:27:31,280 --> 00:27:35,240
Speaker 14: for example, the large tech companies get the vast majority

537
00:27:35,280 --> 00:27:38,919
Speaker 14: of the revenues overseas, like the majority and depends on

538
00:27:39,160 --> 00:27:43,919
Speaker 14: the business and and so good global relations. In addition

539
00:27:43,960 --> 00:27:46,760
Speaker 14: to stability and an ability to kind of know that

540
00:27:46,800 --> 00:27:49,480
Speaker 14: you're following a rule of law versus what I think

541
00:27:49,480 --> 00:27:54,280
Speaker 14: of as grifter capitalism, all of that leads to, like,

542
00:27:54,920 --> 00:27:57,280
Speaker 14: you know, the reason why I and others like me

543
00:27:58,200 --> 00:28:02,680
Speaker 14: support Vice President Harris for president because I think those

544
00:28:02,720 --> 00:28:05,560
Speaker 14: are the more fundamental things. Then you know whether or

545
00:28:05,560 --> 00:28:08,520
Speaker 14: not a corporate tax rate goes up or down a little. Obviously,

546
00:28:08,560 --> 00:28:11,520
Speaker 14: those can be important in other other times for business.

547
00:28:11,920 --> 00:28:15,480
Speaker 14: But that's the reason why I think within the technology industry,

548
00:28:15,520 --> 00:28:17,480
Speaker 14: I think it's a fairly clear choice.

549
00:28:18,520 --> 00:28:18,800
Speaker 1: Read.

550
00:28:18,920 --> 00:28:22,080
Speaker 4: We recently had SEC chair Gary Ginster on the program

551
00:28:22,920 --> 00:28:26,280
Speaker 4: and a part of the conversation for both candidates is

552
00:28:26,359 --> 00:28:30,640
Speaker 4: continuity at the FTC and the SEC. You've actually spoken publicly,

553
00:28:30,760 --> 00:28:34,440
Speaker 4: I think about both already, But what is your latest position.

554
00:28:34,720 --> 00:28:36,160
Speaker 2: On those two roles.

555
00:28:36,240 --> 00:28:39,480
Speaker 4: Lina Kahn and Gary Gensler if Kamala Harris were to

556
00:28:39,520 --> 00:28:41,480
Speaker 4: continue in the White House due to their impact on

557
00:28:41,520 --> 00:28:43,760
Speaker 4: the technology industry.

558
00:28:44,680 --> 00:28:45,840
Speaker 1: Well, let's see.

559
00:28:45,880 --> 00:28:49,480
Speaker 14: So first, since I've spoken, because I get asked a

560
00:28:49,480 --> 00:28:52,520
Speaker 14: lot about Lena Kahn, I've spoken more about Lena Kahan.

561
00:28:53,600 --> 00:28:56,120
Speaker 14: You know, one misconception of clear Up is I've never

562
00:28:56,200 --> 00:28:59,200
Speaker 14: ever talked to Kamala Harris or anyone in the White

563
00:28:59,200 --> 00:29:02,400
Speaker 14: House about Lena con for this. So this is entirely

564
00:29:02,440 --> 00:29:05,560
Speaker 14: a press set of stories where I'm asked about my.

565
00:29:05,840 --> 00:29:06,440
Speaker 1: Point of view.

566
00:29:06,760 --> 00:29:08,960
Speaker 14: And I think she's done a very good job on

567
00:29:09,080 --> 00:29:12,680
Speaker 14: a number of things, the anti compete stuff that click

568
00:29:12,760 --> 00:29:16,400
Speaker 14: to cancel and subscriptions, the number of things on M

569
00:29:16,400 --> 00:29:19,239
Speaker 14: and A speaking as a partner at Greylock and as

570
00:29:19,240 --> 00:29:22,640
Speaker 14: a Silicon Valley person who invests in companies trying to

571
00:29:22,720 --> 00:29:25,040
Speaker 14: create the next generation of large tech companies.

572
00:29:25,640 --> 00:29:28,200
Speaker 1: Her you know, kind of like waging.

573
00:29:27,840 --> 00:29:31,640
Speaker 14: War on M and A is actually, in fact as

574
00:29:31,760 --> 00:29:36,400
Speaker 14: unhelpful to the tech industry. It actually accomplishes something different

575
00:29:36,440 --> 00:29:39,240
Speaker 14: than what she thinks she's accomplishing. She thinks she's trying

576
00:29:39,240 --> 00:29:42,520
Speaker 14: to accomplish the you know, kind of the limitation of

577
00:29:42,520 --> 00:29:44,400
Speaker 14: the growth of the large tech companies, and actually, in

578
00:29:44,440 --> 00:29:47,480
Speaker 14: fact she's causing a lack of funding for any of

579
00:29:47,480 --> 00:29:50,120
Speaker 14: the companies that might potentially compete with them. And so

580
00:29:50,240 --> 00:29:53,160
Speaker 14: that's a that's a different thing, and that's the Lena Khan,

581
00:29:53,200 --> 00:29:55,280
Speaker 14: which I still have the same point of view, and

582
00:29:55,320 --> 00:29:57,280
Speaker 14: I've asked about it from anyone and from.

583
00:29:57,160 --> 00:29:58,160
Speaker 1: An Nextperti's point of view.

584
00:29:58,200 --> 00:30:01,080
Speaker 14: I will continue to say that Gary Gensler, I think

585
00:30:01,120 --> 00:30:03,880
Speaker 14: the question, and I know Gary, I've talked to him

586
00:30:03,880 --> 00:30:06,960
Speaker 14: from the MIT days, is how do you kind of

587
00:30:07,040 --> 00:30:11,000
Speaker 14: shift kind of a kind of approach to crypto that's

588
00:30:11,160 --> 00:30:14,680
Speaker 14: less kind of hit with stick and more of a

589
00:30:15,000 --> 00:30:17,160
Speaker 14: here's the set of rules that we could set out

590
00:30:17,240 --> 00:30:22,000
Speaker 14: that would create a beneficial technological investment that helps US

591
00:30:22,040 --> 00:30:26,360
Speaker 14: position globally, and I think it's been uneven, And so

592
00:30:26,440 --> 00:30:30,520
Speaker 14: I would hope that you know, Vice President Harris, who

593
00:30:30,560 --> 00:30:35,280
Speaker 14: grew up within the California tech community, understands the importance

594
00:30:35,320 --> 00:30:37,600
Speaker 14: of this kind of rule of law, you know, kind

595
00:30:37,640 --> 00:30:41,520
Speaker 14: of equal basis innovation economy. She talked about, you know,

596
00:30:41,600 --> 00:30:45,400
Speaker 14: kind of innovation opportunities. She's the only presidential candidate in

597
00:30:46,400 --> 00:30:49,600
Speaker 14: US history who's spoken about the importance of founders. And

598
00:30:49,680 --> 00:30:51,640
Speaker 14: so I hope that she would bring a kind of

599
00:30:51,640 --> 00:30:54,600
Speaker 14: a more innovation forward point of view here.

600
00:30:54,640 --> 00:30:56,480
Speaker 1: And you know, would anticipate that.

601
00:30:56,880 --> 00:30:59,400
Speaker 2: An innovation forward perspective.

602
00:30:59,760 --> 00:31:03,200
Speaker 3: Is that the key difference that you anticipate if hypothetically

603
00:31:03,240 --> 00:31:08,240
Speaker 3: we had Harris administration, a difference from the current Biden administration,

604
00:31:08,360 --> 00:31:09,640
Speaker 3: or where else might she differ?

605
00:31:10,760 --> 00:31:12,480
Speaker 1: Well, I think so.

606
00:31:12,480 --> 00:31:16,160
Speaker 14: So she has always brought a certain because of you know,

607
00:31:16,360 --> 00:31:19,280
Speaker 14: talk to her over the years, and this intellectual curiosity

608
00:31:19,280 --> 00:31:21,440
Speaker 14: to what's going on in the tech industry, how that

609
00:31:21,480 --> 00:31:23,920
Speaker 14: can help everyday Americans, how that can help the rest

610
00:31:23,920 --> 00:31:26,480
Speaker 14: of American industry. And so it's kind of like, look,

611
00:31:26,520 --> 00:31:29,960
Speaker 14: I realize that the tech industry is about innovation and

612
00:31:30,080 --> 00:31:32,320
Speaker 14: building new things and those building of new things or

613
00:31:32,360 --> 00:31:34,560
Speaker 14: new products and services. But there are also ways that

614
00:31:34,600 --> 00:31:37,360
Speaker 14: can help all of America. And those are the questions

615
00:31:37,400 --> 00:31:41,320
Speaker 14: that she's asked. Now Biden, who has done a number

616
00:31:41,320 --> 00:31:44,480
Speaker 14: of great things in his presidency. You know, he's controlled

617
00:31:44,480 --> 00:31:48,320
Speaker 14: inflation better than you know, post COVID, than any other

618
00:31:48,800 --> 00:31:52,080
Speaker 14: you know, kind of first world country in doing that,

619
00:31:52,120 --> 00:31:52,320
Speaker 14: and I.

620
00:31:52,280 --> 00:31:53,960
Speaker 13: Think has done a number of very good things.

621
00:31:54,280 --> 00:31:55,520
Speaker 1: But he has not been as.

622
00:31:55,400 --> 00:31:58,600
Speaker 14: Engaged with the tech industry, whereas I think, you know,

623
00:31:59,080 --> 00:32:03,040
Speaker 14: Vice President Harrises, including you know, kind of in her

624
00:32:03,160 --> 00:32:06,600
Speaker 14: very acceptance speech, has been And so I think that

625
00:32:06,600 --> 00:32:10,080
Speaker 14: that kind of of how do we engage in the

626
00:32:10,120 --> 00:32:12,880
Speaker 14: conversation and look, for example, what she did in the

627
00:32:13,160 --> 00:32:17,360
Speaker 14: artificial intelligence you know, regulation and executive order process she

628
00:32:17,480 --> 00:32:19,520
Speaker 14: ran that first thing she did is she brought the

629
00:32:19,560 --> 00:32:23,600
Speaker 14: companies into the White House to say, hey, we really

630
00:32:23,600 --> 00:32:27,240
Speaker 14: need you guys to be going foot forward on safety

631
00:32:27,280 --> 00:32:30,040
Speaker 14: and regulation. What kinds of things can you voluntarily commit to?

632
00:32:30,760 --> 00:32:32,160
Speaker 14: You know, I talked to the folks who were there.

633
00:32:32,200 --> 00:32:34,000
Speaker 14: She pushed them very hard on map. Then she looked

634
00:32:34,040 --> 00:32:36,560
Speaker 14: at okay, so this is what they can commit to.

635
00:32:36,720 --> 00:32:39,640
Speaker 14: Here's what we can put into an executive order law.

636
00:32:40,040 --> 00:32:42,480
Speaker 14: Here's what we can do to ongoing monitor to what

637
00:32:42,560 --> 00:32:46,400
Speaker 14: happened and leave room renovation. That's what I expect across

638
00:32:46,680 --> 00:32:49,760
Speaker 14: her approaching the entire technology industry with AI as the

639
00:32:49,760 --> 00:32:50,440
Speaker 14: instance of it.

640
00:32:51,120 --> 00:32:54,600
Speaker 3: Let's go to the other hypothetical, because she's engaging at

641
00:32:54,640 --> 00:32:58,320
Speaker 3: the moment with the tech community. But many would say

642
00:32:58,320 --> 00:33:01,680
Speaker 3: that Trump is very much engaging with technology community with

643
00:33:01,800 --> 00:33:03,160
Speaker 3: the amount that he's having.

644
00:33:03,040 --> 00:33:04,400
Speaker 2: Elon Musk on stage.

645
00:33:05,200 --> 00:33:09,160
Speaker 3: Is we see Musk taking a bigger role within a

646
00:33:09,200 --> 00:33:12,440
Speaker 3: future administration? What does that mean for you and and

647
00:33:12,640 --> 00:33:16,480
Speaker 3: ultimately for the relationship that Silicon Valley has with el

648
00:33:16,480 --> 00:33:17,120
Speaker 3: On the Musk.

649
00:33:18,880 --> 00:33:22,000
Speaker 14: Well, I think it depends on what the Trump administration,

650
00:33:22,120 --> 00:33:26,040
Speaker 14: what Elon does. I think you know, the the Trump

651
00:33:26,440 --> 00:33:31,400
Speaker 14: you know, Trump and Trump presidency won. You know, his

652
00:33:31,400 --> 00:33:34,440
Speaker 14: his early presidency has shown a certain amount of grifter capitalism.

653
00:33:34,480 --> 00:33:38,440
Speaker 14: It's like trying to penalize his opponents using the instruments

654
00:33:38,440 --> 00:33:41,040
Speaker 14: of state. You know, obviously, you know, we saw that

655
00:33:41,040 --> 00:33:44,920
Speaker 14: happen with Amazon, which probably is you know, no inside

656
00:33:44,960 --> 00:33:48,880
Speaker 14: knowledge that probably correlated with Bezos's you know, forbidding the

657
00:33:48,960 --> 00:33:53,479
Speaker 14: Washington Post from issuing a support statement and so It's

658
00:33:53,560 --> 00:33:55,640
Speaker 14: kind of like the if you're going to be individual

659
00:33:55,720 --> 00:33:59,800
Speaker 14: company retaliatory, It's part of what might underlie a terrorist

660
00:34:00,800 --> 00:34:03,920
Speaker 14: is I can choose like who I'm going out favors

661
00:34:03,960 --> 00:34:07,840
Speaker 14: to that does not create a good stable environment for

662
00:34:08,440 --> 00:34:10,799
Speaker 14: investing in, you know, kind of like you know, how

663
00:34:10,840 --> 00:34:13,880
Speaker 14: do you invest in an overall industry and ecosystem. And

664
00:34:13,960 --> 00:34:16,560
Speaker 14: so then the question, you know, would come down with Elon. Obviously,

665
00:34:16,640 --> 00:34:21,840
Speaker 14: Elon's businesses have great ties to government. I mean, the

666
00:34:22,080 --> 00:34:26,600
Speaker 14: whole space business is deeply tied to regulation and kind

667
00:34:26,640 --> 00:34:31,880
Speaker 14: of government contracts. UH Automobiles is also tied to a

668
00:34:31,920 --> 00:34:33,360
Speaker 14: bunch of regulatory frameworks.

669
00:34:34,000 --> 00:34:36,560
Speaker 1: Obviously, you know what's going on with you know.

670
00:34:36,560 --> 00:34:41,319
Speaker 14: Kind of media and information has ties there too, And

671
00:34:41,400 --> 00:34:44,920
Speaker 14: I think unfortunately X dot Com is the primary supporter

672
00:34:45,040 --> 00:34:48,040
Speaker 14: of conspiracy theories and you know other kinds of things,

673
00:34:48,640 --> 00:34:49,960
Speaker 14: which is a serious problem.

674
00:34:50,360 --> 00:34:51,480
Speaker 1: All of that, the question.

675
00:34:51,360 --> 00:34:53,319
Speaker 13: Is is, all right, well, does it continue to be.

676
00:34:53,320 --> 00:34:57,239
Speaker 14: Grifter capitalism which is calling out to specific companies, or

677
00:34:57,320 --> 00:34:58,160
Speaker 14: is it rule of law?

678
00:34:59,360 --> 00:35:02,360
Speaker 4: I read on X and conspiracy theories. Bloomberg did a

679
00:35:02,360 --> 00:35:05,719
Speaker 4: deep report, a data based piece of investigative journalism on

680
00:35:05,760 --> 00:35:08,120
Speaker 4: that recently, and in that segment on the show, which

681
00:35:08,120 --> 00:35:10,960
Speaker 4: you can find on YouTube. We gave X's point of view,

682
00:35:11,000 --> 00:35:13,120
Speaker 4: which is that they disagree with that. And if you

683
00:35:13,200 --> 00:35:15,720
Speaker 4: allow me to, I've invited Elon Musk onto this program

684
00:35:15,760 --> 00:35:19,720
Speaker 4: many times, and you are here and he's not. Something's

685
00:35:19,719 --> 00:35:22,480
Speaker 4: different in this election. You're a well known person in

686
00:35:22,520 --> 00:35:24,880
Speaker 4: the world of technology, but there are others on both

687
00:35:24,960 --> 00:35:29,200
Speaker 4: sides who are speaking out, in my experience, more prominently

688
00:35:29,239 --> 00:35:33,399
Speaker 4: than previously. Have there been any negative consequences of that.

689
00:35:33,480 --> 00:35:35,960
Speaker 4: For example, if you are a bench capitalist or a

690
00:35:36,000 --> 00:35:41,600
Speaker 4: CEO that publicly speaking about your political orientation and your

691
00:35:41,640 --> 00:35:44,319
Speaker 4: support of a candidate has resulted in a loss of

692
00:35:44,320 --> 00:35:46,920
Speaker 4: opportunity in deals or whatever it may be.

693
00:35:49,040 --> 00:35:51,759
Speaker 14: Well, I've seen and you know, I think, you know,

694
00:35:51,840 --> 00:35:54,480
Speaker 14: this is something that's this fraught. You know, I don't

695
00:35:54,480 --> 00:36:00,200
Speaker 14: think it's just you know, retaliation in business circumstances from

696
00:36:00,440 --> 00:36:03,520
Speaker 14: folks who are supporting Trump, like I saw, you know,

697
00:36:03,600 --> 00:36:06,840
Speaker 14: kind of you know, when vcs were speaking out, some

698
00:36:07,120 --> 00:36:11,560
Speaker 14: LPs were very supportive of Trump, not at gray Lock

699
00:36:11,640 --> 00:36:15,799
Speaker 14: in this, but in other firms kind of uh, you know,

700
00:36:15,880 --> 00:36:20,040
Speaker 14: withdrew their support from the venture firms. I've seen other

701
00:36:20,120 --> 00:36:25,160
Speaker 14: kinds of things where you know, people you know kind

702
00:36:25,200 --> 00:36:29,200
Speaker 14: of uh, you know, kind of business relationships of soured

703
00:36:29,239 --> 00:36:31,320
Speaker 14: because of it, you know, which I think is very unfortunate.

704
00:36:31,400 --> 00:36:33,719
Speaker 14: I mean, I actually think the part of what we

705
00:36:33,719 --> 00:36:37,480
Speaker 14: should aspire to as Americans and as business people is

706
00:36:37,520 --> 00:36:40,239
Speaker 14: to is to kind of say, hey, look, what we

707
00:36:40,239 --> 00:36:42,319
Speaker 14: should do is say what's the thing that we do

708
00:36:42,480 --> 00:36:47,520
Speaker 14: to make American business and American industry better? And you know,

709
00:36:47,560 --> 00:36:52,040
Speaker 14: like I've I've I've heard of Republican senators trash talking

710
00:36:52,120 --> 00:36:55,960
Speaker 14: me internationally where you know, you think they'd be supportive

711
00:36:56,280 --> 00:36:59,040
Speaker 14: of American business people. So I think that there is

712
00:37:00,080 --> 00:37:02,480
Speaker 14: I think there are consequences of it, which you know,

713
00:37:02,520 --> 00:37:06,240
Speaker 14: I think is unfortunate. But I think it's more important

714
00:37:06,280 --> 00:37:10,160
Speaker 14: to be, you know, kind of patriotic about what is

715
00:37:10,200 --> 00:37:14,239
Speaker 14: good for America, American industry, and American society even when.

716
00:37:14,160 --> 00:37:14,799
Speaker 1: You have this fear.

717
00:37:15,800 --> 00:37:20,280
Speaker 3: Let's talking about the souring of certain relationships. The first

718
00:37:20,280 --> 00:37:22,000
Speaker 3: one that comes to my mind is the souring of

719
00:37:22,000 --> 00:37:25,680
Speaker 3: the relationship of who was a co founder of open ai,

720
00:37:25,800 --> 00:37:28,800
Speaker 3: Elon Musk and now open ai more.

721
00:37:28,680 --> 00:37:30,240
Speaker 2: Explicitly in its new form.

722
00:37:30,680 --> 00:37:33,719
Speaker 3: Have you spoken to Sam Altman about and indeed open

723
00:37:33,760 --> 00:37:36,640
Speaker 3: ai about the worries of Elon Musk, who seems to

724
00:37:36,680 --> 00:37:40,920
Speaker 3: have a dislike for the business, if he took a

725
00:37:40,920 --> 00:37:43,560
Speaker 3: more prominent role within the administration, what would it look

726
00:37:43,600 --> 00:37:45,880
Speaker 3: like for AI more broadly to have Elon Musk in

727
00:37:45,920 --> 00:37:46,720
Speaker 3: a position of power.

728
00:37:48,480 --> 00:37:51,840
Speaker 14: Well, one of the things that I would worry about

729
00:37:52,000 --> 00:37:54,799
Speaker 14: if Elon took a more prominent role is that he

730
00:37:54,800 --> 00:37:58,640
Speaker 14: would view that the only real success for you know,

731
00:37:58,800 --> 00:37:59,400
Speaker 14: the AI.

732
00:37:59,200 --> 00:38:00,560
Speaker 1: Industry is if he is doing it.

733
00:38:00,600 --> 00:38:04,480
Speaker 14: I mean, this is part of the question around the

734
00:38:04,520 --> 00:38:07,440
Speaker 14: fact that he's kind of doing these baseless lawsuits against

735
00:38:07,480 --> 00:38:10,879
Speaker 14: open AI that are you know, kind of like, well,

736
00:38:10,920 --> 00:38:13,640
Speaker 14: I gave money philanthropically and I should kind of cut

737
00:38:14,040 --> 00:38:18,040
Speaker 14: of what then turns into commercial, which is by the way, illegal, right,

738
00:38:18,480 --> 00:38:23,279
Speaker 14: and so you know, so that kind of of of

739
00:38:23,960 --> 00:38:28,200
Speaker 14: of issue might then rear its head in this kind

740
00:38:28,200 --> 00:38:32,120
Speaker 14: of tradition of you know, kind of Trump's grifter or capitalism.

741
00:38:32,719 --> 00:38:36,040
Speaker 14: I would hope that actually, in fact, if if Elon

742
00:38:36,400 --> 00:38:38,439
Speaker 14: were to accept a role, that he would go, look,

743
00:38:38,440 --> 00:38:40,600
Speaker 14: what I care about is all of them, you know,

744
00:38:40,680 --> 00:38:44,400
Speaker 14: the tech sector of American industry, not just my own efforts.

745
00:38:45,000 --> 00:38:47,319
Speaker 13: And I think we'd have to see what would play out.

746
00:38:47,360 --> 00:38:51,640
Speaker 4: Then the latest on the listigation between the two I

747
00:38:51,640 --> 00:38:54,520
Speaker 4: believe is also the eighth when open AI accused Elon

748
00:38:54,600 --> 00:38:57,239
Speaker 4: Musk of harassment in that legal fight, and again we've

749
00:38:57,239 --> 00:38:59,040
Speaker 4: covered it on this program Read and we'll go back

750
00:38:59,080 --> 00:39:04,239
Speaker 4: to it. Is AI and regulation of AI being discussed

751
00:39:04,360 --> 00:39:07,360
Speaker 4: enough in this election by either candidate.

752
00:39:09,280 --> 00:39:12,640
Speaker 14: Well, I'm not sure that it's the most central thing

753
00:39:12,920 --> 00:39:17,080
Speaker 14: for kind of the general American society at the moment. Look,

754
00:39:17,080 --> 00:39:19,880
Speaker 14: I think the how we get the benefits of AI

755
00:39:20,120 --> 00:39:23,840
Speaker 14: for American industry, American society, American consumers, I think is

756
00:39:23,880 --> 00:39:26,759
Speaker 14: really important. And one of the things about regulation is

757
00:39:26,800 --> 00:39:29,280
Speaker 14: it tends to slow down innovation, it tends to delay

758
00:39:29,320 --> 00:39:32,719
Speaker 14: and I think our tools for getting a medical assistant

759
00:39:32,800 --> 00:39:36,800
Speaker 14: on every smartphone, a tutor on every smartphone for every

760
00:39:37,280 --> 00:39:40,799
Speaker 14: American and maybe even more globally, I think those are

761
00:39:40,800 --> 00:39:42,560
Speaker 14: the important things to be trying to get to. And

762
00:39:42,600 --> 00:39:46,200
Speaker 14: that's less of a discussion about, you know, AI in

763
00:39:46,239 --> 00:39:49,960
Speaker 14: the election, but more kind of a like we should

764
00:39:49,960 --> 00:39:51,240
Speaker 14: be building towards the future.

765
00:39:52,320 --> 00:39:54,920
Speaker 4: Read. Ifdent former President Trump were to get a second

766
00:39:55,000 --> 00:39:57,759
Speaker 4: term in office, how are you preparing for that and

767
00:39:57,800 --> 00:39:59,000
Speaker 4: how do you approach it?

768
00:39:59,239 --> 00:40:00,480
Speaker 1: Were that to be the A case.

769
00:40:02,360 --> 00:40:04,640
Speaker 14: Well, if that's the case, then I would hope for

770
00:40:04,719 --> 00:40:07,600
Speaker 14: the folks who who have argued to me that, you know,

771
00:40:07,800 --> 00:40:11,680
Speaker 14: you shouldn't actually in fact take President Trump's words seriously.

772
00:40:11,880 --> 00:40:13,880
Speaker 14: That the fact that he is declaring a you know,

773
00:40:13,960 --> 00:40:16,600
Speaker 14: like a tariff war where you can do individual kind

774
00:40:16,600 --> 00:40:19,080
Speaker 14: of grifter capitalism, but that's actually not what.

775
00:40:19,040 --> 00:40:19,560
Speaker 1: He's going to do.

776
00:40:19,600 --> 00:40:22,040
Speaker 14: That he's going to try to be more business forward,

777
00:40:22,120 --> 00:40:25,160
Speaker 14: more technology forward, and you should not be paying attention

778
00:40:25,600 --> 00:40:27,680
Speaker 14: to what his words are. I would hope that they

779
00:40:27,719 --> 00:40:31,040
Speaker 14: would be they would be correct if it ends up

780
00:40:31,120 --> 00:40:34,319
Speaker 14: being what I fear, which is actually in fact a

781
00:40:34,800 --> 00:40:37,560
Speaker 14: you know, kind of an individual kind of uh, you know,

782
00:40:37,840 --> 00:40:41,200
Speaker 14: like sweating various businesses for his own kind of political favor.

783
00:40:42,000 --> 00:40:44,520
Speaker 14: I think that will affect American industry in a way

784
00:40:44,520 --> 00:40:47,960
Speaker 14: that will affect American prosperity. And so I think you

785
00:40:48,040 --> 00:40:50,759
Speaker 14: have to you have to you build in more resilience

786
00:40:50,800 --> 00:40:53,840
Speaker 14: to chaos an uncertainty, and that's what you would do.

787
00:40:53,920 --> 00:40:57,359
Speaker 14: I'm obviously very hopeful that Vice President Harris will win

788
00:40:57,400 --> 00:41:02,080
Speaker 14: the election, and so therefore haven't done enormous contingency planning yet.

789
00:41:02,760 --> 00:41:05,239
Speaker 3: We want to thank you so much for your perspective

790
00:41:05,239 --> 00:41:09,640
Speaker 3: today as you do. Indeed back Vice Paradison and Harris

791
00:41:10,120 --> 00:41:13,240
Speaker 3: for the administration is the future, Gray Lot partner Reid Hoffman,

792
00:41:13,480 --> 00:41:16,160
Speaker 3: we appreciate it, ed Okay.

793
00:41:16,200 --> 00:41:19,400
Speaker 4: Today's Big Take focuses on how Amazon is working to

794
00:41:19,400 --> 00:41:23,400
Speaker 4: make its Alexa devices a force in artificial intelligence. CEO

795
00:41:23,480 --> 00:41:26,759
Speaker 4: Andy jasse is eager to take on chat GPT with

796
00:41:26,840 --> 00:41:30,120
Speaker 4: the voice assistant that Amazon's claims is in one quarter

797
00:41:30,560 --> 00:41:34,319
Speaker 4: of US households, but technical challenges are slowing the company down.

798
00:41:34,600 --> 00:41:37,839
Speaker 4: Bloomberg's Austin carr Co wrote the Big Take, we are

799
00:41:37,880 --> 00:41:41,200
Speaker 4: an Alexa household that I'm using Chat GPT four oh,

800
00:41:41,280 --> 00:41:44,160
Speaker 4: voice inputs, so much more meta AI through the ray

801
00:41:44,200 --> 00:41:48,720
Speaker 4: banned glasses. It's an incredible dissection of the struggle Amazon

802
00:41:48,800 --> 00:41:50,800
Speaker 4: is having bringing Alexa into that field.

803
00:41:52,080 --> 00:41:53,160
Speaker 1: Yeah, it's pretty wild.

804
00:41:53,360 --> 00:41:55,640
Speaker 15: I mean just think it's been already almost two years

805
00:41:55,640 --> 00:42:00,360
Speaker 15: since chat GPT launched. Meanwhile, Microsoft, Google, even Apple have

806
00:42:00,440 --> 00:42:03,160
Speaker 15: rolled out a lot of AI tools and we haven't

807
00:42:03,160 --> 00:42:06,279
Speaker 15: really seen anything from Amazon despite them having more than

808
00:42:06,320 --> 00:42:09,360
Speaker 15: a decade lead in the chat bond space. You know,

809
00:42:09,360 --> 00:42:13,000
Speaker 15: they're in five hundred million some households with their devices,

810
00:42:13,280 --> 00:42:16,680
Speaker 15: but they've been struggling to move that old Alexa brain

811
00:42:16,800 --> 00:42:20,560
Speaker 15: to sort of a new LLM large language model approach.

812
00:42:21,400 --> 00:42:23,680
Speaker 15: And they've been dealing internally, based on the sources we're

813
00:42:23,680 --> 00:42:27,080
Speaker 15: talking to, with tons of hallucinations, with struggles with basic

814
00:42:27,160 --> 00:42:29,520
Speaker 15: tax The old Alexa used to be good at, like

815
00:42:29,560 --> 00:42:32,040
Speaker 15: turning on and off lights. And it's been really fascinating

816
00:42:32,040 --> 00:42:34,000
Speaker 15: to watch this company that is, you know, famous for

817
00:42:34,160 --> 00:42:38,160
Speaker 15: data infrastructure for cloud computing with AWS and with Alexa

818
00:42:38,320 --> 00:42:41,120
Speaker 15: A really fall behind in this AI war, and there's

819
00:42:41,160 --> 00:42:43,080
Speaker 15: a lot of questions among the sources we talked to

820
00:42:43,760 --> 00:42:45,839
Speaker 15: over whether or not they'll be able to catch up.

821
00:42:46,760 --> 00:42:48,680
Speaker 3: What's so great about the way you write is you

822
00:42:48,719 --> 00:42:51,360
Speaker 3: make it interesting and personal. We all know Andy Jesse,

823
00:42:51,920 --> 00:42:55,040
Speaker 3: of course, the leader of Amazon, is a big sports fan,

824
00:42:55,160 --> 00:42:57,200
Speaker 3: and you talk about how he keeps plodding the Alexa

825
00:42:57,280 --> 00:43:00,320
Speaker 3: with sports questions, and it just hallucinates in that effect,

826
00:43:00,440 --> 00:43:04,480
Speaker 3: particularly about up to the moment results. What therefore are

827
00:43:04,480 --> 00:43:06,880
Speaker 3: we seeing in terms of further investment, What are we

828
00:43:06,880 --> 00:43:09,680
Speaker 3: seeing in terms of eventual rollout.

829
00:43:10,880 --> 00:43:13,240
Speaker 15: It's TVD at this point, but our sources are indicating

830
00:43:13,239 --> 00:43:16,319
Speaker 15: that it's actually been repeatedly pushed back. There was an

831
00:43:16,360 --> 00:43:19,239
Speaker 15: early target in twenty twenty early twenty twenty four. Then

832
00:43:19,280 --> 00:43:21,759
Speaker 15: it was moved back month by month, most recently in

833
00:43:21,760 --> 00:43:24,160
Speaker 15: October they were hoping to launch it. They scrap that

834
00:43:24,239 --> 00:43:27,880
Speaker 15: event and they've replaced it with a smaller Kindle rollout.

835
00:43:28,440 --> 00:43:30,720
Speaker 15: So sourts are telling us this could actually be their target.

836
00:43:30,719 --> 00:43:33,759
Speaker 15: Deadline is being kicked back into twenty twenty five, which

837
00:43:33,840 --> 00:43:35,719
Speaker 15: really puts them behind the ball. But again, it's all

838
00:43:35,719 --> 00:43:38,600
Speaker 15: these technical challenges they're facing. It's not a matter of

839
00:43:38,640 --> 00:43:43,719
Speaker 15: necessarily buoucracy or some lack of overall goal. They're really

840
00:43:43,760 --> 00:43:45,960
Speaker 15: marghaling at troops toward this, and they're really running into

841
00:43:46,080 --> 00:43:49,640
Speaker 15: challenges with again making sure sort of an LLLM can

842
00:43:49,680 --> 00:43:52,719
Speaker 15: do basic tasks like you know, all the tasks that

843
00:43:52,719 --> 00:43:54,960
Speaker 15: you asked it to do around your home. Lms are

844
00:43:54,960 --> 00:43:58,000
Speaker 15: actually not particularly good at that. And with the hallucinations

845
00:43:58,080 --> 00:44:00,640
Speaker 15: with all these devices and homes of families, kids, you

846
00:44:00,680 --> 00:44:03,759
Speaker 15: don't want it spewing off sort of information that's provocative

847
00:44:03,880 --> 00:44:06,520
Speaker 15: or the list that can be a really reputational cause

848
00:44:06,520 --> 00:44:09,040
Speaker 15: a lot of reputational damage for Amazon and the Alexa brand.

849
00:44:10,280 --> 00:44:12,360
Speaker 4: There's this great academic debate we could have, but we

850
00:44:12,400 --> 00:44:15,080
Speaker 4: don't have time about the best hardware form factor to

851
00:44:15,280 --> 00:44:18,799
Speaker 4: use AI models in the voice system form. The other

852
00:44:18,840 --> 00:44:20,839
Speaker 4: bit of news is there is a timeline delay into

853
00:44:20,880 --> 00:44:23,200
Speaker 4: twenty twenty five. Just tell us what you understand. The

854
00:44:23,280 --> 00:44:26,200
Speaker 4: team is working to Amazon to get this into the

855
00:44:26,200 --> 00:44:26,760
Speaker 4: real world.

856
00:44:27,880 --> 00:44:30,560
Speaker 15: So the big challenge right now is merging that old

857
00:44:30,600 --> 00:44:32,960
Speaker 15: brand with the new brain. There's a lot of argument

858
00:44:32,960 --> 00:44:35,680
Speaker 15: about whether they should just scrap the old Amazon approach

859
00:44:35,840 --> 00:44:38,839
Speaker 15: and move to the sort of an LLM model that chat,

860
00:44:38,840 --> 00:44:43,200
Speaker 15: GPT and meta or using. But they're trying to do

861
00:44:43,239 --> 00:44:45,600
Speaker 15: this hybrid approach and that takes a lot of custom

862
00:44:45,680 --> 00:44:47,880
Speaker 15: code to make sure you know, when I ask it

863
00:44:47,920 --> 00:44:50,399
Speaker 15: to do a request it can deliver that it knows

864
00:44:50,400 --> 00:44:52,560
Speaker 15: my permissions, it knows that I have access to this

865
00:44:52,680 --> 00:44:55,680
Speaker 15: light bulb or this kitchen time or this microwave. And

866
00:44:55,719 --> 00:44:58,719
Speaker 15: that's the irony is that all the stuff that Amazon

867
00:44:58,960 --> 00:45:02,040
Speaker 15: Alexa is actually re good at are very simple tasks,

868
00:45:02,160 --> 00:45:05,440
Speaker 15: and that's what lms are not particularly adept at.

869
00:45:05,640 --> 00:45:08,560
Speaker 3: Bloomberg's Austin Carr, it's a great read. Thank you for

870
00:45:08,600 --> 00:45:11,239
Speaker 3: bringing it to us. Meanwhile, that does it for this

871
00:45:11,400 --> 00:45:14,759
Speaker 3: edition of Bloomberg Technology and Ed. We've got earnings like

872
00:45:14,800 --> 00:45:17,880
Speaker 3: Amazon after the Bell. But an important conversation coming up tomorrow.

873
00:45:18,560 --> 00:45:22,680
Speaker 4: Yeah, today the Democratic perspective. Tomorrow the Republican vivet Ramaswami,

874
00:45:22,760 --> 00:45:25,840
Speaker 4: a surrogate or backer or booster for Trump, will be

875
00:45:25,880 --> 00:45:28,640
Speaker 4: on the program to give his take on the technology

876
00:45:28,640 --> 00:45:31,279
Speaker 4: discussion to be had for either candidate. But you should

877
00:45:31,320 --> 00:45:34,000
Speaker 4: recap on the podcast. It was a pack show. It

878
00:45:34,120 --> 00:45:36,640
Speaker 4: was crazy. You know where to find it. Cara and

879
00:45:36,680 --> 00:45:39,440
Speaker 4: the team in New York. Everyone here in SF. Wow,

880
00:45:39,640 --> 00:45:41,320
Speaker 4: this was a great Bloomberg technology