Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: From Mahart where Innovation, money and power Collie in Silicon
Speaker 2: Vallet NBN.
Speaker 3: This is Bloomberg Technology with Caroline Hyde and Ed Ludlow.
Speaker 4: Live from New York. This is Bloombag Technology. Coming up.
Speaker 5: TikTok still faces an austing in the United States after
Speaker 5: a DC appeals caught upholds the divest or ban law.
Speaker 5: Plus more VC voices in the new administration. As Donald
Speaker 5: Trump selects venture capitalist David Sachs to serve as his
Speaker 5: AI and cryptos are and Hpe, which is a record
Speaker 5: high after posting earnings, we talk AI servers with the
Speaker 5: company's CEO. First, we check in on the markets and
Speaker 5: other record highs than just Hpe. We have the Nazak
Speaker 5: one hundred and a new record up seven tens of percent.
Speaker 5: The macro picture being that of a resilient jobs market
Speaker 5: and even though there's sort some infrationery pressure, the market
Speaker 5: almost pricing in some sort of rate cup for later
Speaker 5: this month coming from the Fed.
Speaker 4: So we see stocks move high.
Speaker 5: The SMP at a new record two fifty seventh that
Speaker 5: we'd see have almost thirty percent year to date in
Speaker 5: terms of points contributors. You're looking at Broadcom doing well
Speaker 5: also met her as well, which we'll dig into in
Speaker 5: a moment. And that's all because of TikTok's Chinese parent company,
Speaker 5: Byte Dance, still facing that ban here in the United
Speaker 5: States if it doesn't meet the January nineteenth deadline to
Speaker 5: divest TikTok. This after a federal appeals court just came
Speaker 5: out with its decision to uphold the ban. Blouembgs Alexandra
Speaker 5: Levine joins us now, who covers all things social, all
Speaker 5: things TikTok, and you are surprised, ultimately by this ruling.
Speaker 3: This is what we expected, but it still is very
Speaker 3: surprising in the sense that we've never seen this happen
Speaker 3: in the United States before. So if this band comes
Speaker 3: to pass late in January, it will be the first
Speaker 3: time that any foreign owned social media app has ever
Speaker 3: been banned in this country. And again, it's not just
Speaker 3: any social media app. This is a social media app
Speaker 3: used by more than half the American population.
Speaker 5: I'm backed by some very powerful people potentially close to
Speaker 5: the next administration, benure capitalists, pe funds. But what's interesting
Speaker 5: is what's the effect this is happening on the company itself.
Speaker 3: Yeah, inside the company, I think the sentiment has been fascinating.
Speaker 4: It's sort of been twofold.
Speaker 3: I think there's a lot of folks inside the company
Speaker 3: who had been more actually scared the first time that
Speaker 3: this happened with Trump's first administration, when Trump was originally
Speaker 3: the one who tried to ban it back in twenty
Speaker 3: twenty unsuccessfully, So that then when all of this has
Speaker 3: been transpiring this year, you had a lot of people
Speaker 3: who were like, we've seen this movie before. This is
Speaker 3: sort of boy who cried wealth. They didn't actually believe
Speaker 3: it would come to this, But I think the court
Speaker 3: upholding the legitimacy of the law today could well change
Speaker 3: people's tune.
Speaker 5: Just for our audience, we have a little live far
Speaker 5: drill going on here in Lexington Avenue, New York, So
Speaker 5: bear with us when we have some of these particular
Speaker 5: announcements coming through the camera. At Alexander Levine, we thank you
Speaker 5: so much on all things TikTok. Let's go to Blue
Speaker 5: Meg Intelligence analyst Matthew Schunhelm for more. Who I'm pleased
Speaker 5: to say, isn't that in New York so wouldn't get
Speaker 5: the sort of interference from a noise perspective, Matthew. From
Speaker 5: the legal perspective here, what was the ruling from the judges? Ultimately,
Speaker 5: they think that national security out trumps upon the pun.
Speaker 4: What's happening from a freedom of speech perspective.
Speaker 6: That's exactly right, Carolina. Looking quickly at the sixty five
Speaker 6: page opinion, this looks like a sweeping loss for TikTok,
Speaker 6: where the court completely rejected its its First Amendment argument
Speaker 6: and said that national security concerns trump all of those complaints.
Speaker 6: The court said that this fails both intermediate scrutiny and
Speaker 6: even strict scrutiny, which almost never works.
Speaker 4: But the court said, look, the.
Speaker 6: Government's interest in national security trumps the First Amendment concerns
Speaker 6: no matter what the test is. This is a tough
Speaker 6: loss for TikTok, and I think it's going to be
Speaker 6: difficult for TikTok to overturn it.
Speaker 5: To that point, you had what a seventy percent chance
Speaker 5: that TikTok would lose on this particular DC court. They're
Speaker 5: only inning here now is to go to the Supreme Court.
Speaker 5: What are your probabilities on that or is it too
Speaker 5: early to tell?
Speaker 6: No, I think that is going to be the option.
Speaker 6: In theory, they could ask for rehearing at this Appeals Court,
Speaker 6: but this decision leaves little hope of that. So I
Speaker 6: think you're right that the next move is an emergency
Speaker 6: petition to the Supreme Court to say justices hit pause
Speaker 6: on this January nineteenth date. This is an important First
Speaker 6: Amendment case. As Alexandra said, this is sort of novel
Speaker 6: in American law, and so trying to entice the Justices
Speaker 6: to at least look at it before the date take
Speaker 6: comes up. It's the thing is, it's difficult to do
Speaker 6: that though. It takes five justices to vote in support
Speaker 6: of that, and with this sweeping decision, two of the
Speaker 6: three judges who wrote this decision are Republican appointed. One
Speaker 6: of them's President Trump appointed, and this Supreme Court tends
Speaker 6: to agree with with those judges. I think there's a
Speaker 6: real possibility the Supreme Court looks at this and says,
Speaker 6: you know what, the d C. Circuit got it right.
Speaker 6: We might not even need to take this up. So
Speaker 6: there's a chance of that that they hit pause and
Speaker 6: the Supreme Court has to rule on it. But there's
Speaker 6: also I think a better chance the Supreme Court says no,
Speaker 6: they got it right. This case is over let the
Speaker 6: band take effect.
Speaker 5: What then, legally speaking, does TikTok do? What does Bite
Speaker 5: Dance do?
Speaker 7: Yes?
Speaker 6: So, so the question then is will it Will it
Speaker 6: do a divestiture? You know, the law gives it a
Speaker 6: path around an effective van by by by by selling
Speaker 6: the service to someone who's not located in China. The
Speaker 6: problem is that China has said it won't approve a
Speaker 6: sale with of the algorithm, So so TikTok's in a
Speaker 6: bit of a tough spot in that sense. The other
Speaker 6: big question is what will President Trump do with this?
Speaker 6: Will he enforce this law? The enforcement mechanism is the
Speaker 6: Department of Justice here, and President Trump in theory could
Speaker 6: direct his Department of Justice say don't worry about enforcing
Speaker 6: that one. That would be highly unusual and the companies
Speaker 6: that host TikTok would be taking enormous risk. He wouldn't
Speaker 6: change his mind, But it's at least a possibility.
Speaker 5: We don't rule out anything, of course, for the future,
Speaker 5: and I'm i am interested as to whether you know
Speaker 5: from behind the scenes ultimately what it could look like
Speaker 5: if they did divest and legally speaking, how that might
Speaker 5: have to ultimately.
Speaker 6: Look, yeah, I mean there's a big question. I think
Speaker 6: the biggest question around the divestiture is whether TikTok would
Speaker 6: or potential buyers would look at a transaction that doesn't
Speaker 6: involve the algorithm. And if China won't approve a sale
Speaker 6: of the Algori Rhythm, maybe you're looking at selling you
Speaker 6: just the users and the platform, but without the secret
Speaker 6: sauce that makes it work and so well, I think
Speaker 6: you could see the company exploring those sorts of alternatives
Speaker 6: in the near term.
Speaker 5: We will wait to see whether indeed it does get
Speaker 5: pushed onto the Supreme Court.
Speaker 4: But can you give us a feeling of timing him?
Speaker 5: I think January the nineteenth feels incredibly close. Now it
Speaker 5: is one day before the new administration is sworn in.
Speaker 4: Here we go with the fire alarms again.
Speaker 5: But what are you thinking in terms of just an
Speaker 5: extension past January nineteenth exactly?
Speaker 6: So, what I expect we'll see here in maybe today,
Speaker 6: maybe in a matter of days, is this emergency petition
Speaker 6: to the Supreme Court asking the justices to hit pause
Speaker 6: on that January nineteenth date. And I think the Supreme
Speaker 6: Court will take that petition. It will ask for briefs
Speaker 6: on that leading into January, and then the the Supreme
Speaker 6: Court is either going to say yes or no, probably
Speaker 6: in mid January, about whether it will grant this case,
Speaker 6: take the case and hit pause on that January nineteenth date.
Speaker 6: So that's where the legal action is likely to be
Speaker 6: in this pushing the justices to hit pause on that
Speaker 6: January nineteenth date. And as I said, I kind of
Speaker 6: think that the justices might say, no, we don't need
Speaker 6: to step in here. Let's let the law take effects.
Speaker 5: The DC Circuit got it right, and then it's over
Speaker 5: to Trump and then your administration. Matthew Shettenham fascinating you
Speaker 5: called it right this time. We'll check in with you later. Meanwhile,
Speaker 5: here's another Trump pick, David Sachs as White House, AI
Speaker 5: and cryptos are Trump posting on truth Social that the
Speaker 5: venture capitalist will quote guide policy for the administration in
Speaker 5: artificial intelligence and cryptocurrency. Two areas critical to the future
Speaker 5: of American competitiveness. Romost Katie Ruff helps cover all things
Speaker 5: venture and once again we have another venture capitalist. Then
Speaker 5: of course we have who's the deputy the Vice president
Speaker 5: elect as well being one.
Speaker 4: David Sachs has been close to Trump. Of late. Can
Speaker 4: you just tell us how we got here, sir?
Speaker 8: He was a big fundraiser, you know, for the presidential campaign,
Speaker 8: and he's also quite close to Daily Vance. The vice
Speaker 8: president elect, David Sachs was hosting fundraisers and also getting
Speaker 8: other Silicon Valley supporters to come on board and support Trump.
Speaker 8: So it's not surprising that there's some sort of role
Speaker 8: or partnership here.
Speaker 5: And indeed not a full at the seat role in
Speaker 5: politics that means he has to step away from Craft ventures.
Speaker 5: We know that he has sort of ultimately focused there
Speaker 5: because he's got a key man risk. His venture capital
Speaker 5: history is extraordinary. He's been in the angel rounds of
Speaker 5: Facebook now Meta, in Pan and Teer in some of
Speaker 5: the most successful exits that we've seen coming out of
Speaker 5: Silicon Valley. He built his own company that was exited Microsoft,
Speaker 5: earning him one point two billion dollars, well earning at
Speaker 5: least the sale price of one point two billion dollars.
Speaker 5: How intimately is he interweaved within AI and crypto because
Speaker 5: he has Bitgo bit Wise Lightning Labs for example, within
Speaker 5: his portfolio.
Speaker 8: Sure, there's already questions where people are asking does he
Speaker 8: have a conflict of interest here, but given that this
Speaker 8: is a less formal role, it's unclear if there's any
Speaker 8: roadblocks there. He's you know, certainly, you know, very much
Speaker 8: a part of the ecosystem. He has a popular all
Speaker 8: in podcast that many people in Silicon Valley and beyond
Speaker 8: listen to, where he airs controversial opinions. But I would
Speaker 8: see this as a sign of deregulation. He is definitely
Speaker 8: very tech friendly, you know, with crypto and AI. He
Speaker 8: is going to want to move to make moves to
Speaker 8: prevent anything that is obstructing the growth of these technology companies.
Speaker 4: kJ Ruth, we thank you, HPE.
Speaker 5: We're wanting strong fourth quarter results and we're seeing shares
Speaker 5: at a new record high. It's all around the sales
Speaker 5: strength that we're seeing for service to power AI workloads.
Speaker 5: How resilient is that, Let's ask Antonio and airing HPE CEO.
Speaker 5: So what's interesting about the AI server business was that
Speaker 5: it's still growing fast. But is it cool sequentially, are
Speaker 5: you feeling confident about the purchases here?
Speaker 2: Well, good morning, Carol, and thank you for having me today.
Speaker 2: We have an exceptional quarter and obviously one of the
Speaker 2: flagship elements of that quarter was AI, but I have
Speaker 2: to say it was more than AI. It was also
Speaker 2: a hybrid cloud business performing exceptionally well, and the sort
Speaker 2: of in general because all the matter we have growth
Speaker 2: both on the traditional CPU and obviously on the I side,
Speaker 2: but on the I demand continued to be very, very strong.
Speaker 2: You know, as of today we have more than three
Speaker 2: and a half billion dollars in backlog. That shows the
Speaker 2: moments that's there in the market. Now we're seeing a
Speaker 2: significant uptake in the pipeline in enterprise AI, but in
Speaker 2: total we have a pipeline that's a multiple of the backlogs.
Speaker 2: So as we go into twenty twenty five, obviously there
Speaker 2: is a transition to the direct liquid cool set of
Speaker 2: technologies with Blackwell and Grace Blackwell, and as you know,
Speaker 2: two months ago we announced a new architecture which is
Speaker 2: one hundred percent fund less. Direct liquid cooling is the
Speaker 2: industry first and one third more than one third of
Speaker 2: that three and a half been under a backlog is
Speaker 2: already on black Bell, So we expect continue growth as
Speaker 2: we go into twenty five.
Speaker 5: How are those Blackpole shipments looking how certain.
Speaker 2: Well, definitely is all very consistent to what we have
Speaker 2: seen the number of customers continue to grow. The demand
Speaker 2: across four different segments continue to be very solid. You know,
Speaker 2: when I think about THEI I think about four distinct segments.
Speaker 2: I call it the model builders and the hyperscalers, then
Speaker 2: the Tier two, Tier three service provider, the sovereign which
Speaker 2: is growing very rapidly in terms of interest, and the
Speaker 2: cell cycles a little bit longer there. But in talking
Speaker 2: about large scale deployment, and we are in the process
Speaker 2: to building in the UK the UK Bristol AI Cloud
Speaker 2: and in Japan the ais T and then the enterprise
Speaker 2: which obviously the order value is significant lower, but the
Speaker 2: number transaction is significantly higher.
Speaker 5: But the supply side has been the issue with Blackwell
Speaker 5: in particular. How swiftly are those shipments arriving? How on
Speaker 5: track do you now feel it is?
Speaker 2: Yeah, I will say, you know, the supply will come
Speaker 2: in due time because of the transition that Jensen and
Speaker 2: team are driving. I will not say it's problematic, it's
Speaker 2: just the transition in early parts of twenty twenty five.
Speaker 2: Today we continue to ship you know H one hundreds
Speaker 2: and the H two hundreds. But as I said earlier Carolyn,
Speaker 2: we already have more than one third of that more
Speaker 2: than three and a half billion dollars of the Blackwell,
Speaker 2: and a lot of that has to do with companies
Speaker 2: that lead with that technology because they want to get
Speaker 2: better performance, better image density, and ultimately lower the cost
Speaker 2: per training.
Speaker 5: You were really interesting articulating just the breadth of demand
Speaker 5: coming from there, mentioning sovereign as well as enterprise for example.
Speaker 4: How resilient is that demand?
Speaker 5: What's interesting about your backlog, which you say is very
Speaker 5: resilient and strong, but there was a seven hundred.
Speaker 4: Million dollar d booking. How confident are you in.
Speaker 5: Some of these purchases, in some of these deals that
Speaker 5: have been signed.
Speaker 2: Yeah, so in our current more than three and a
Speaker 2: half billion dollars, are very very confident. In Q four,
Speaker 2: we booked one point two billion dollars of new orders,
Speaker 2: and we decided to book a specific orders because we
Speaker 2: had specific concerns about the risk associated with that order,
Speaker 2: and we have very very strong controls in place, and
Speaker 2: we felt that because of the risk associated with even
Speaker 2: the finance inside, we felt this not worth the headache,
Speaker 2: and honestly, we decided to focus on the number of
Speaker 2: growing customers we have and allocated supply to the right customers,
Speaker 2: So that's why we decided to debook the specific order.
Speaker 5: Caroline, you're also doing deals, of course, we are hearing
Speaker 5: confidence on June and Pan Networks acquisition for the early
Speaker 5: twenty twenty five. Is that just going to sell through DOJ?
Speaker 5: Do you expect with the next administration?
Speaker 2: Yeah, Well, first of all, we have received pretty much
Speaker 2: all the approvals around the world with you know what
Speaker 2: I call unconditional support. Basically, it tells you that the
Speaker 2: rest of the world sees this pro competitive and with
Speaker 2: the DOJ, we have had a very collaborative process through
Speaker 2: throughout the last several months, and we expect the transaction
Speaker 2: to close in the early part of twenty twenty five,
Speaker 2: which still is within the original timelines we stated when
Speaker 2: I announced the deal on January tenth, which was end
Speaker 2: of calendar twenty twenty four or early part of calendar
Speaker 2: twenty twenty five. And so nothing gives me post that
Speaker 2: will not be the case. And then in addition, for
Speaker 2: the United States, this is good not just pro competitive,
Speaker 2: but also for US national security because ultimately the combination
Speaker 2: and Juniper HP provides a better ability for US to
Speaker 2: compete outside the United States, particularly when you have Chinese
Speaker 2: competitor around the globe, and remember a part of that.
Speaker 2: For the United States, we provide the largest supercomputers that
Speaker 2: are doing also AI and that requires a lot of networking.
Speaker 2: And today i Qula pack and Enterprise owns seven of
Speaker 2: the top ten supercomputers. Number one, number two, and number
Speaker 2: three are HP Systems.
Speaker 5: Well being reflected in a new record high on the
Speaker 5: share price and augustanding sounding very upbeat about eventually what
Speaker 5: Juniper does in terms of accretion. We thank you Antonio
Speaker 5: and ery c Hpeco today. I meanwhile coming up us
Speaker 5: Haring picked up in November, adding two hundred and twenty
Speaker 5: seven thousand jobs. We've discussed the resilience in the tech sector,
Speaker 5: what it means in terms of impact. We are just
Speaker 5: reflecting on a couple of stories out of France today.
Speaker 5: Ubersoft up twelve let's call it thirteen percent this as
Speaker 5: we get an articulation and potentially what some sort of
Speaker 5: management buyout could be looking like the Gilamott family holding
Speaker 5: talks with ten cent as of room reported by Reuters
Speaker 5: and other investors. We're up thirty percent there, and boy
Speaker 5: are we down on Athos. Look, we're basically nil nil
Speaker 5: point ninety eight percent lower that you're seeing for a
Speaker 5: price point on at ours stock. This as we are
Speaker 5: expecting a subscription price of its recent rights offering sinking,
Speaker 5: you know, ultimately coming to a very low number stocking
Speaker 5: trading as you see at zero. This is blombog technology
Speaker 5: time now for talking tech. First up, NASA hasn't landed
Speaker 5: on the Moon in fifty years. The next one now
Speaker 5: won't happen until at least twenty twenty seven. The newly
Speaker 5: announced delays come as engineers raised the crucial safety issue
Speaker 5: related to hardware now. The agency also announced it will
Speaker 5: delay a moonfly by until twenty twenty six. The scheduling
Speaker 5: setbacks are the latest in the program plagued by spacecraft
Speaker 5: cost overruns and technical hurdles. Meanwhile, Uber launching its first
Speaker 5: robo taxi service in Abadami, making good on a partnership
Speaker 5: struck with Chinese vehicle partner we Ride. Customers are able
Speaker 5: to request autonomous vehicles around key tourist areas in the UAE,
Speaker 5: and Uber expects to fully launch its driveraler's service.
Speaker 4: In twenty twenty five.
Speaker 5: And the dramatic events in South Korea this week has
Speaker 5: catapulted a year old movie to the top of the
Speaker 5: Netflix charts. The film twelve twelve The Day, became at
Speaker 5: the number one Korean film streamed since South Korean President
Speaker 5: unsub yul stunned the nation by imposing Marshall Law. The
Speaker 5: twenty twenty three blockbuster depicts the events surrounding.
Speaker 4: A coup in nineteen seventy nine.
Speaker 5: Now, there have been some big market moves today and
Speaker 5: in large part is on the back of US job
Speaker 5: Stata November payrolls coming in strong two hundred and twenty
Speaker 5: seven thousand added.
Speaker 4: But we want to get the ten perspective.
Speaker 5: Sarah frankpin Let, us CEO, joins US now and Sarah,
Speaker 5: we are fascinated by ultimately how resilient this US job's
Speaker 5: data looks, and how that resilience is.
Speaker 4: Potentially being born out in tech. Is it so what
Speaker 4: you're saying is true.
Speaker 9: We're seeing this resilience, we're seeing predictability, and we're seeing
Speaker 9: balance in the data, and we're seeing incredible time and
Speaker 9: tech not just with the jobs report and the two
Speaker 9: hundred twenty seven thousand jobs, but also with a new
Speaker 9: entrant to the labor force, with digital labor.
Speaker 5: Let's just talk about how augmenting digital labor is or not.
Speaker 5: It's interesting your Alma Mater salesforce coming out saying they're
Speaker 5: going to be reallocating a thousand workers to be going
Speaker 5: out and selling their agent force. How much are we
Speaker 5: having to see people work in tandem with the growth
Speaker 5: of generative AI.
Speaker 9: You're definitely seeing this new world where AI is working
Speaker 9: together with humans and where people are successful working together
Speaker 9: with AI technology. And every CEO is looking to the
Speaker 9: future in saying, how do I reshape my workforce? How
Speaker 9: do I bring AI in to help us be more productive,
Speaker 9: more efficient from the public to the private sector.
Speaker 5: Okay, so where are some of the worries that are
Speaker 5: still overhanging in CEOs? That it does seem to be
Speaker 5: this disconnect that we've got all of these generative AI
Speaker 5: tools fit for use to buoy our productivity, but actually
Speaker 5: a lot of the workforce are either scared to use
Speaker 5: it because they think they'll be deemed lazy or do
Speaker 5: you just don't getting the training?
Speaker 4: Is that something to change?
Speaker 9: So AI literacy and AI proficiency are more important than ever,
Speaker 9: And yes, every CEO is saying, how do I bring
Speaker 9: my workforce along my people along, to skill them, to
Speaker 9: train them, to make them proficient, not just literate, but
Speaker 9: proficient in these technologies. It's critical for every job function,
Speaker 9: whether you're doing customer service, sales, accounting, data operations. AI
Speaker 9: is a part of everyone's jobs and so the skilling
Speaker 9: and the training is hand in hand with the implementation
Speaker 9: of the technology.
Speaker 5: I ask it short each time you'll run, but I
Speaker 5: ask it again, is it affecting the number of people
Speaker 5: that companies can have?
Speaker 9: So there's definitely efficiency gains that we'll see, and companies
Speaker 9: are looking to have a way to scale their workforce
Speaker 9: in ways that meets their needs. And so we're going
Speaker 9: to see shifts in the labor and jobs will change,
Speaker 9: some jobs will be created, some jobs may go away.
Speaker 9: But the future is one where AI and digital labor
Speaker 9: is here. The reports coming out of Deloitte say that
Speaker 9: a quarter of enterprises next year are going to be
Speaker 9: deploying digital agents and so it's important that everybody learned
Speaker 9: this technology and every CEO is looking how they shape
Speaker 9: their workforce with both people and with the new digital
Speaker 9: labor entrance LATICS.
Speaker 5: Number one AIPAD people platform. Someone to listen to your serf,
Speaker 5: thank you so much, Lattice CEO the on jobs in
Speaker 5: tandem with AI, Welcome back to Blue Meg Technology. I'm
Speaker 5: Caroline Hide in New York and in New York markets
Speaker 5: are training in a new record high and as that
Speaker 5: one hundred continues to grind higher, up three percent over
Speaker 5: the course of the last five training days. Today, the
Speaker 5: moon music continues to the upside because of jobs data
Speaker 5: looking resilient but not too hot to cause unnerve to
Speaker 5: any fulfilling of a fed rate cut Outlook, we're currently up,
Speaker 5: as you see, three point one percent on the five days.
Speaker 5: Where has crypto gone over the last five days, It
Speaker 5: has been a volatile ride at one point eclipsing one
Speaker 5: hundred and three thousand dollars. We're still up one point
Speaker 5: four percent for the last five training days. We're currently
Speaker 5: back at ninety nine thy one hundred and seventy eight,
Speaker 5: as we call it, just inching higher on the day.
Speaker 5: We're basically stabilizing after what had been a bit of
Speaker 5: a pullback after reaching that psychologically important number. Let's dig
Speaker 5: into that number and into what else is riding behind
Speaker 5: it Isabelle Lee joins us, what's interesting, of course, we
Speaker 5: get that new cryptos are crypto in AIS.
Speaker 4: Are David Sachs coming in?
Speaker 5: That's going to be yet more positive moon muse around crypto.
Speaker 5: It was the SEC announcement we'll not use quote your attention.
Speaker 10: That everything is aligning, The stars are aligning for the
Speaker 10: crypto space. Everything is just nothing can beat it. It's
Speaker 10: like the perfect holiday for them. We have bitcoin soaring,
Speaker 10: but we have various wagers actually taking up. Of course,
Speaker 10: investors are taking back their profits. I mean who wouldn't,
Speaker 10: especially if you put in a lot of it. But
Speaker 10: I want to bring our attention to the Bitcoin ETF.
Speaker 10: Black Rocks ie bit is the fifth most active ETF
Speaker 10: option underlying when it approved options just less than a
Speaker 10: month ago. It now is the fifth most active according
Speaker 10: to ASIM. So that's really impressive because it's only behind
Speaker 10: the biggest ETFs from SPY to QQQ to TLT, and
Speaker 10: it's the most successful ETF so far. It officially hit
Speaker 10: fifty billion, so you really see institutional demand going into that.
Speaker 10: We have Wall Street investors are not scared anymore of
Speaker 10: bitcoin ETF.
Speaker 5: Well, they're not scared of really quite leverage plays as well.
Speaker 5: People getting into micro strategy playing the volatility around it,
Speaker 5: we dug into that where are we starting to see
Speaker 5: other areas growth from institutional and retail, So that's what
Speaker 5: we're not seeing yet for the out coin et So
Speaker 5: we have Ether ETF.
Speaker 10: It debuted mid this year and it really saw kind
Speaker 10: of lamb inflows, but when Trump was elected as president,
Speaker 10: that's when it's all massive inflow. So now we have
Speaker 10: a lot of pending ETFs from XRP to Solana, fourth
Speaker 10: and fifth largest odd coins, So it remains to be
Speaker 10: seen whether we will see inflows for them.
Speaker 4: But judging by Ether, it's.
Speaker 10: Not such a promising start. But with the Trump presidency
Speaker 10: and to your point, David Sachs and the new SEC pick,
Speaker 10: maybe investors will pil into those ETFs.
Speaker 5: And what's interesting is, of course this is becoming so
Speaker 5: much more of a macro picture now. This is an
Speaker 5: asset class that people do feel that they almost ought
Speaker 5: to have exposure to, not should do as a risky propensity, at.
Speaker 4: Least for a bitcoin.
Speaker 10: Because if you talk to my mother or anyone who
Speaker 10: is like gen Z or whatever label generation you have
Speaker 10: digital goal, they get find that supply, they get inflation
Speaker 10: heads they get But how do you sell eather XRP Solana.
Speaker 10: So those are a bit more complex, but you're right,
Speaker 10: Bitcoin at least now is becoming a little bit more mainstream.
Speaker 10: It's easier to accept, easier to digest. Black Og Investment Institute,
Speaker 10: in fact, in their twenty twenty five outlook included bitcoin
Speaker 10: for the first time. They said it's a great diversifier
Speaker 10: because of the erratic stock one relationship. So it's getting
Speaker 10: their conversation is moving into crypto for now.
Speaker 5: I literally was at the station yesterday and two police
Speaker 5: officers were telling each other how they were in bitcoin
Speaker 5: and how it was going to go higher.
Speaker 4: So there we have it.
Speaker 5: Everyone's talking is bully, Thank you so much on all
Speaker 5: things crypto. Let's turn from crypto to data security now.
Speaker 5: Because data security software firm Rubrics come out with its
Speaker 5: numbers and the company beat earning expectations, boosted its full
Speaker 5: year revenue guidance. You can see the market reaction extraordinary,
Speaker 5: up thirty four percent on the day, and of course
Speaker 5: that's a record high. Let's talk to Rubrics CEO and
Speaker 5: Cofanna Bevolsina.
Speaker 4: I mean, congrats on the numbers.
Speaker 5: Analysts really liking what you've been able to show in
Speaker 5: terms of cross selling here that many saying, look, you're
Speaker 5: the only game in town when it comes to cyber
Speaker 5: and data security.
Speaker 4: How are you seeing in your client's pick up?
Speaker 11: Thanks Carlin, we had another outstanding quartern. We are very
Speaker 11: pleased to not only have a strong growth at a
Speaker 11: scale top line, but we also improved the profitability and
Speaker 11: generated free cas flow. So exciting time, exciting time for us.
Speaker 11: What is fueling Rubik's demand is really this realization that
Speaker 11: folks have spent a lot of dollars in stopping attacks
Speaker 11: across network, endpoint, cloud, but you can't stop the unstoppable.
Speaker 11: You need to have a resiliency strategy to ensure that
Speaker 11: when the inevitable breach happens, you can still run your business.
Speaker 11: The kids can go to school because your schools are open,
Speaker 11: hospitals can admit patients, and that's what we are focused on.
Speaker 11: And we are helping businesses make sure they are a
Speaker 11: continuing operation even when they're confronted with cyber attack. And
Speaker 11: that's what is fueling our demand.
Speaker 5: It's interesting today a really well lend story on bloombog
Speaker 5: by Ryan Gallagher is all about ransomware gangs really targeting
Speaker 5: not just really big institutions, but smaller medium sized enterprises.
Speaker 5: And when you've got ransomware attacks up seventy twenty twenty three,
Speaker 5: what is the outlook for everyone having to adopt some
Speaker 5: sort of protection Hendry.
Speaker 11: Brit Ransomware continues to be a huge problem because there's
Speaker 11: some monetizable way for cybergangs and criminals to actually make
Speaker 11: use of cyber attack. So the issue is like who
Speaker 11: are they targeting? And they are targeting the weakest link,
Speaker 11: which is our local government's local schools. They are targeting
Speaker 11: the hospitals and other healthcare institutions because these organisms are
Speaker 11: not protected properly. If you just think about healthcare, there
Speaker 11: is so much sensitive data in healthcare, three times more
Speaker 11: sensitive data than average enterprise, and the amount of digital
Speaker 11: transformation that is happening in the healthcare space to reduce
Speaker 11: the cost of healthcare, to deliver better services. It it's
Speaker 11: creating more surface area of attack and as a result,
Speaker 11: we are focused on really protecting the unprotected.
Speaker 4: We're just going to break some news.
Speaker 5: Hold on for a minute, people, what we have news
Speaker 5: out of our own Mark Gum and regarding Apple with
Speaker 5: a breaking news that Apple is preparing in fact to
Speaker 5: finally bring one of its most ambitious projects to market,
Speaker 5: basically the cellular modem chips that we've been hearing about
Speaker 5: that's going to replace components for its partner, but also
Speaker 5: basically let's call its adversary Qualcom call come off by
Speaker 5: a percentage point, Apple up three tenths of a percent,
Speaker 5: more than half a decade, more than five years. They've
Speaker 5: really been focused on this in house modem system and
Speaker 5: it's going to be debuting next spring, according to people familiar.
Speaker 4: We will bring you more in that story.
Speaker 5: But let's just get back to a people of rubric
Speaker 5: because we're just talking about how the expans expansionary nature
Speaker 5: of these attacks, ransomware attacks.
Speaker 4: Unfortunately, can you paint the picture.
Speaker 5: Of what it looks like going into a next administration
Speaker 5: twenty twenty five. Are we likely to see in any
Speaker 5: way the narrative their change around data protection, data security, cybersecurity.
Speaker 11: The next administration will be America first administration, and that
Speaker 11: will actually spur more industrial espionage, more cyber warfare, more
Speaker 11: cyber activities, both insider attacks, cyber attack and so we
Speaker 11: believe that as we are digitizing faster and the next
Speaker 11: administration will be quite business focused administration. So we believe
Speaker 11: that the outlook for cybersecurity is obviously grim, and we
Speaker 11: are ready and prepared to help businesses protect themselves as
Speaker 11: they expand internationally, as they expand their business, as they
Speaker 11: create more digital transformation. Our goal is to help every
Speaker 11: business confidently transform themselves digitally without worrying about how they
Speaker 11: can keep their services up and running.
Speaker 4: We haven't mentioned Jenai yet. How much are you having
Speaker 4: to reference it to your clients?
Speaker 11: Look, Geni is a big driver to our business because
Speaker 11: Genai applications actually data hungry and they are pulling data
Speaker 11: from all the nooks and crannies of business applications into
Speaker 11: a centralized place and ensuring that that data doesn't fall
Speaker 11: into the wrong hand who uses the Genai applications. You
Speaker 11: don't want sale people in a hospital to have access
Speaker 11: to the patient record, and this is where we are
Speaker 11: focused on really delivering data security, ensuring that the Genai
Speaker 11: applications are trusted and responsible.
Speaker 5: Rubric soaring thirty four percent on the back of your
Speaker 5: numbers today, great to has some time with you before
Speaker 5: Seena Rubric, CEO, Now more earnings coming up. Docu signed
Speaker 5: CEO and Tigerson is going to be joining US as
Speaker 5: next after the firm also beats expectations on its earnings.
Speaker 5: This is BlueBag Technology, electronic signature software company DocuSign.
Speaker 4: It's third quarter numbers really did beat expectations.
Speaker 5: The company is boosting its revenue forecast for the full
Speaker 5: year as well. We're up again twenty five percent on
Speaker 5: this particular company. Let's have a talk about it with
Speaker 5: the docu signed CEO and antiquson who ultimately is displaying
Speaker 5: what seems to be a growth here that is not
Speaker 5: just coming from early contract renewal but also new products
Speaker 5: that you're offering. How much are they to be said
Speaker 5: for the galvanization and growth.
Speaker 7: Yeah, well, first of all, it was a very positive
Speaker 7: quarter for us. I think we beat on all the
Speaker 7: metrics and we're able to raise for the full year
Speaker 7: and that was really a reflection of strength across the board.
Speaker 7: So in our existing business and signature of business, everyone
Speaker 7: knows well, we significant improve retention and reduced churn. We've
Speaker 7: grown our channels from being predominantly direct sales to now
Speaker 7: also having a very strong digital channel and building out
Speaker 7: our partner channel. And then, as you mentioned, our new
Speaker 7: products which we launched at the end of May to
Speaker 7: a limited distribution to the mid sized customers in North
Speaker 7: America started contributing in this quarter as well, So it's
Speaker 7: still early, but I think Doug Sun's on a very
Speaker 7: positive trajectory of rejuvenation.
Speaker 5: Rejuvenation, let's talk about that, because the acceleration of billings
Speaker 5: are basically coming from a very depressed level, and everyone
Speaker 5: is saying that this is really encouraging. But when I
Speaker 5: look at Pypasuna and in particular, they're sort of waiting
Speaker 5: for really the new solutions and new offerings to make
Speaker 5: meaningful difference to your revenue.
Speaker 4: When will that happen? Will that happen?
Speaker 7: Yeah, Well, it's a journey and we're working on that.
Speaker 7: Our goal is to return to double digit growth. We're
Speaker 7: not putting this particular timeline on that, but as we
Speaker 7: roll out these new products across more geographies and segments.
Speaker 7: We just launched around the world here about a month
Speaker 7: ago and just started shipping to enterprise rollouts and departmental
Speaker 7: level rollots and enterprises, so we're still adding customer segments
Speaker 7: and geographies and as that impacts more and more of
Speaker 7: our book, we can drive more growth. And of course
Speaker 7: any continued improvement in our core business also helps, and
Speaker 7: so you're starting to see some early signs of that.
Speaker 7: We got more work to do, but it's very encouraging
Speaker 7: the progress that we're making.
Speaker 5: You've got some more convincing to do, because when I'm
Speaker 5: looking at the Bloomberg terminal, it points out what the
Speaker 5: revenue expectations are for your business going out to twenty
Speaker 5: twenty seven. I'm afraid we're staying in single digits for
Speaker 5: all of those expectations. As far as we go, what
Speaker 5: do you think really catalyzes back to I'm not saying
Speaker 5: the forty percent increase in revenue we used to be
Speaker 5: having in twenty twenty one twenty two, but at least
Speaker 5: the double digit What gets you there?
Speaker 7: Alan, Yeah, I think I think we get there through
Speaker 7: that through the combination of continued improvement and retention to
Speaker 7: our core and then the full rollout and adoption of
Speaker 7: our new products. We can call it intelligent agreement management.
Speaker 7: It's a much broader value proposition the Dockshine has had historically.
Speaker 7: It's a true C suite cell. It's across the entire enterprise,
Speaker 7: and we have I think tremendous green field opportunity are
Speaker 7: in the best position to really help transform how agreements
Speaker 7: get done. That's our opportunity. As we execute on that,
Speaker 7: then we can deliver on that growth opportunity.
Speaker 5: You've got about a billion news is one and a
Speaker 5: half million customers. What sort of numbers do you end
Speaker 5: up getting to do you think?
Speaker 7: Well, so we already have, as you mentioned, over a
Speaker 7: billion signers. I'm sure we will add more signers, but
Speaker 7: we've got a lot of people who are already used
Speaker 7: to sign Docusigne documents. And from a customer perspective, we're
Speaker 7: adding about ten percent, growing our customer base ten percent
Speaker 7: year every year, every quarter. But those tend to be
Speaker 7: smaller customers. We are already present in most large companies
Speaker 7: in the world. I believe over eighty five percent of
Speaker 7: the Fortune five hundred are already docks signed customers. So
Speaker 7: our opportunity is more adding breath, basically cross selling and
Speaker 7: up selling our new broader solutions into clients that are
Speaker 7: already generally happy customers are docusigned. So fantastic starting point.
Speaker 5: Where is the competition for you? Who do you put
Speaker 5: yourself most often up against?
Speaker 7: Yeah, Historically we've had some competition in the electronic signature space,
Speaker 7: where by far the market leader I think the preferred
Speaker 7: branded solution, but we have some lower price competition there.
Speaker 7: I think increasingly, as we move into this broader agreement
Speaker 7: management space, those competitive dynamics changed, and as I mentioned,
Speaker 7: we believe that's mostly open field running and we're the
Speaker 7: first to I think, articulate this broader vision and execute
Speaker 7: on it. So if we can keep that going, I
Speaker 7: think we're in a We're in a very good position competitively.
Speaker 4: And just give us a bird side perspective.
Speaker 5: When you're in one hundred and eighty countries where is
Speaker 5: growing most geographically, how resilient does the US look when
Speaker 5: we're entering a new administration.
Speaker 7: Yeah, well, the year's economy has been the strongest of
Speaker 7: the major development markets, and so we're certainly benefiting from that.
Speaker 7: On the other hand, the US is also the furthest
Speaker 7: along in the adoption of electronic signature, which still remains
Speaker 7: the bulk of our revenue, whereas some other major markets,
Speaker 7: for example Germany and Japan are a much earlier state
Speaker 7: of adopting various forms of electronic contract so we have
Speaker 7: a lot of growth opportunity there. We're growing faster, namefully
Speaker 7: faster outside the US than we are in the US,
Speaker 7: and I think that will continue to be the case
Speaker 7: for years to come.
Speaker 5: Dokus signed CEO al An Tikison. It's great to having
Speaker 5: some time with the congratulations on the share pop on
Speaker 5: the numbers. We appreciate your time Meta AI using it,
Speaker 5: probably because six hundred million people are using it every
Speaker 5: single month Meta platforms and a new record high. Also
Speaker 5: on the back of the TikTok news. Of course, that
Speaker 5: TikTok span or divest will continue to January the nineteenth
Speaker 5: and maybe gets pushed over to the Supreme Court, but
Speaker 5: the Washington Court upholds it. But also happening with Meta
Speaker 5: now is the CEO Mark Luckberg saying in a post
Speaker 5: on Threads the company is releasing its Lama three point
Speaker 5: three seventy billion text model, saying it perform similarly to
Speaker 5: previous models, and the CEO is also noting that Meta
Speaker 5: ai has nearly six hundred million monthly active users. As
Speaker 5: an inter leaves Generative AI across its entire product range,
Speaker 5: will delve into Generative AI in the competition there right
Speaker 5: now because Elil muks Xai has raised six billion dollars
Speaker 5: in new capital, wrapping up a funding round that has
Speaker 5: been in the works for basically months now. It was
Speaker 5: said to value the AI startup at about forty billion dollars.
Speaker 5: This is all according to a regulatory filing which indicates
Speaker 5: the equity financing came from some ninety seven investors who
Speaker 5: were not named. Noma's Kirk Wagner has been going through
Speaker 5: those details and Xai is more about the generative AI
Speaker 5: models being built, large language.
Speaker 4: Models, and plenty more. What is he using the money for.
Speaker 12: Yeah, a big portion of this money is expected to
Speaker 12: go towards this supercomputer that Xai has been building in Memphis, Tennessee.
Speaker 12: You may remember, I believe they announced it over the summer,
Speaker 12: the idea that this would be possibly the largest supercomputer
Speaker 12: in the world, with tens of thousands of Nvidia chips
Speaker 12: all sort of running at the same time. So that's
Speaker 12: obviously a very expensive project. It's a very you know,
Speaker 12: ambitious project. And that sort of explains why Elon Musk
Speaker 12: not only raised or six billion dollars here for Xai
Speaker 12: in the filing that we just saw yesterday, but also
Speaker 12: six billion additional dollars in funding back in May right.
Speaker 12: So this is twelve billion that has been raised just
Speaker 12: in the last six months or so.
Speaker 5: And we know who previous investors have been. I mean
Speaker 5: one of them is now the Ai and cryptos are
Speaker 5: to the next administration. David Sachs has been putting money
Speaker 5: into Xai and every other mask business really, but who
Speaker 5: else has previously wanted to write checks for this company?
Speaker 12: Yeah, we see a similar roster almost every time Elon
Speaker 12: goes out to raise money. You know, Andrees and Horowitz, Sequoia,
Speaker 12: Capital valor Equity. These are the sort of you know,
Speaker 12: the continuous or regular investors in Elon's businesses, not just XAI,
Speaker 12: but also x formerly Twitter, SpaceX Tesla. Right, so we
Speaker 12: see the same names kind of crop up every time.
Speaker 12: We don't know exactly who's in this latest round, but
Speaker 12: you can bet that's it's most likely the same names
Speaker 12: we see regularly with him.
Speaker 5: And what's been so interesting to understand what XAI means
Speaker 5: the rest of the businesses because we have at one
Speaker 5: point concerns that some of the GPUs or at least
Speaker 5: spending that was heading towards Tesla was being pinched over
Speaker 5: to Xai. But then you have perhaps how much Ai
Speaker 5: is going to help Tesla's business model, how much it's
Speaker 5: going to continue to innovate on Grock for example.
Speaker 12: Yeah, this is sort of the thorny world in which
Speaker 12: Elon operates with all of his businesses, right where he
Speaker 12: tends to borrow resources from one company to help another company.
Speaker 12: In this case, he's talked about you know, obviously x
Speaker 12: and all the posts that are showing up on x
Speaker 12: as being the data that's powering Xai and the chatbot
Speaker 12: groc that they built. He's talked about using Xai with
Speaker 12: Tesla and maybe even investing in Xai via Tesla. So
Speaker 12: you know his universe, as you know, Caroline, it's just
Speaker 12: everything kind of blurs together. And so we're seeing this
Speaker 12: as sort of the AI layer for I think a
Speaker 12: bunch of his companies, and I think the more funding
Speaker 12: they get, especially from investors who are already invested in
Speaker 12: the other businesses, you'll see this continue, this kind of
Speaker 12: connection between Xai and everything else in Musk's empire.
Speaker 5: And meanwhile, let's just talk about the ecosystem that surrounds it.
Speaker 5: Because we've had Sam Altman on stage at the deal
Speaker 5: Book conference this week talking about how he's not too
Speaker 5: worried or perturbed about el Musk hitting in on open
Speaker 5: AI's future success. But what about you know, we've got
Speaker 5: Meta just announcing how many people are using their generative
Speaker 5: AI products across the whole gamut of their product offering.
Speaker 5: Where are people going at the moment from genera offerings
Speaker 5: more broadly.
Speaker 12: Yeah, I mean, I think Chat GPT from open ai
Speaker 12: still sort of is maybe the first thing that comes
Speaker 12: to mind when people think about this. It's probably the
Speaker 12: most well known. But Meta, as you point out, they
Speaker 12: just had announcement literally a few minutes ago, six hundred
Speaker 12: million monthly users of their Meta AI bot. Now they
Speaker 12: benefit from the fact that they put that bot into
Speaker 12: Instagram and Facebook and WhatsApp, so they're reaching you know,
Speaker 12: billions of people just by putting the product in something
Speaker 12: that they are already using. But I do think that,
Speaker 12: you know, we're getting to this place where there's going
Speaker 12: to be a couple or winners or a couple you know,
Speaker 12: companies kind of coming out in front. I think Chat GBT,
Speaker 12: Meta AI, and then GROCK obviously is built into X.
Speaker 12: So those are the three that come to mind for
Speaker 12: me when I when I think of these generative AI bots.
Speaker 4: Co Wagner across the space.
Speaker 5: We appreciate it, and look, let's just dig a little
Speaker 5: bit more into these models. Because of the tech industry
Speaker 5: has kind of been hitting a bit of a wall
Speaker 5: when it comes to building better generative AI modelsmost Sharon
Speaker 5: Gafari has been writing about this your latest newsletter Q
Speaker 5: and AI.
Speaker 4: And what's interesting is Mark.
Speaker 5: Zuckerberg just released Lama releases LAMA three point three, and he's,
Speaker 5: you know, seeing it as the next base model. How
Speaker 5: have people been heading up against improvements here though?
Speaker 4: So here's the thing.
Speaker 1: AI is certainly getting better, but we have to think
Speaker 1: about the kind of bold bets and predictions that the
Speaker 1: leaders of these AA companies are making, which is that
Speaker 1: we are going to reach some kind of all knowing,
Speaker 1: you know, very powerful, matching or surpassing human intelligence level
Speaker 1: AI in the next few years. And so that is
Speaker 1: the kind of intense race that these companies are going
Speaker 1: against right now, and that is why there are some
Speaker 1: kind of missed expectation around the pace of which they'll
Speaker 1: be able to actually deliver on that.
Speaker 5: But some am in this week just briefly saying twenty
Speaker 5: twenty five, right.
Speaker 1: That's right, and you know, again we are seeing progress,
Speaker 1: but by now some people were hoping. You know, we
Speaker 1: haven't yet seen a GPT five level model. We haven't
Speaker 1: yet seen the next big model from anthropics. So that's
Speaker 1: what sort of the end goal is.
Speaker 5: Go read your newsletter, Sharon KAfari, thanks for joining us today.
Speaker 5: That does it for this edition of Blue Meg Technology.
Speaker 5: Don't forget to check out our podcast. Find it on
Speaker 5: the terminal as well as online on Apple, Spotify, and
Speaker 5: iHeart