WEBVTT - Hot CPI Print and Lyft Earnings 0:00:01.639 --> 0:00:05.960 From Marhard where Innovation, Money and power Collie in Silicon 0:00:06.040 --> 0:00:06.920 Vallet NBN. 0:00:07.280 --> 0:00:11.320 This is Bloomberg Technology with Caroline Hyde and Ed Ludlow. 0:00:25.040 --> 0:00:27.880 I'm Caroline Heinder Blomberg's world headquarters in New York, and 0:00:27.920 --> 0:00:29.480 I met Lovelow in San Francisco. 0:00:29.680 --> 0:00:31.600 This is Bloomberg Technology. 0:00:31.080 --> 0:00:34.000 Coming up US inflation it tops forecast in a blow 0:00:34.040 --> 0:00:36.600 to rate cut hopes. We'll discuss the implication of high 0:00:36.640 --> 0:00:38.360 for longer rates on the tech sector. 0:00:38.960 --> 0:00:41.720 Plus we'll dive into the names reporting tonight after the 0:00:41.760 --> 0:00:43.640 bell and get a read on the health of the 0:00:43.760 --> 0:00:44.720 gig economy. 0:00:45.080 --> 0:00:46.440 And we'll get an outlook for crypto. 0:00:46.600 --> 0:00:49.879 That's as bitcoin drops, having hit fifty thousand dollars for 0:00:49.880 --> 0:00:52.479 the first time in two years. All that and so 0:00:52.680 --> 0:00:55.000 much more coming up. First we check on in the 0:00:55.040 --> 0:00:59.000 macro picture today is dictated by that hotter than anticipated 0:00:59.040 --> 0:01:02.320 CPI print, which which means well, the market now anticipates 0:01:02.400 --> 0:01:05.119 rate cuts not happening until at least July, you let 0:01:05.160 --> 0:01:08.080 alone March that we'd previously been anticipating. Look, it is 0:01:08.560 --> 0:01:10.960 not therefore to those rate cut views and the S 0:01:11.000 --> 0:01:12.960 and P five hundred falls off that all important five 0:01:13.000 --> 0:01:15.160 thousand level that we do only just hit on Friday, 0:01:15.400 --> 0:01:17.920 the NASDAC under pressure then as that one hundred in particular, 0:01:17.959 --> 0:01:19.360 one of the worst performing off by one. 0:01:19.240 --> 0:01:22.399 Point two percent. So big tech really being squeezed at the. 0:01:22.360 --> 0:01:25.319 Moment, and you see those boring costs absolutely leaping to 0:01:25.319 --> 0:01:27.720 the higher side, the two year yield eclipsing the high 0:01:27.720 --> 0:01:29.800 since we've seen back in December when the FED did 0:01:29.840 --> 0:01:32.440 pivot and really make the market think we were going 0:01:32.520 --> 0:01:34.800 to see some rate cuts coming in twenty twenty four, 0:01:34.800 --> 0:01:37.760 we're currently up by some thirteen basis points in ed. 0:01:37.760 --> 0:01:39.480 Before we get into the micro we want to go 0:01:39.600 --> 0:01:43.319 broader with clear Bridge Investment senior research analysts Hillary Frish, 0:01:43.360 --> 0:01:45.840 who can really give us a perspective of what's been 0:01:45.880 --> 0:01:49.480 happening on a resasset basis, and ultimately we are seeing 0:01:49.520 --> 0:01:53.080 Hillary a perspective that well, maybe rate cuts aren't happening 0:01:53.120 --> 0:01:54.680 and what that means in terms of all the bets 0:01:54.680 --> 0:01:58.400 and the valuations ultimately they've been seen in big tech names. 0:01:58.520 --> 0:02:03.440 Do you think it's the right time to be such. 0:02:01.640 --> 0:02:04.320 A good question, Caroline, Thank you, it's terrific being here. 0:02:05.160 --> 0:02:07.960 It's we've had. 0:02:07.880 --> 0:02:11.239 Such a great run in technology and a relative relatively 0:02:11.280 --> 0:02:13.640 short period of time, and going into today's print, I 0:02:13.720 --> 0:02:17.919 was thinking that we're already entering a seasonally weaker part 0:02:17.960 --> 0:02:22.400 of the year. Now the tenures CPI is looking hotter, 0:02:22.919 --> 0:02:26.720 and also the US dollars up, so we can and 0:02:26.919 --> 0:02:30.799 absolutely likely will have some sell off at some period 0:02:30.840 --> 0:02:33.200 of time. I think at a minimum, we should have 0:02:33.240 --> 0:02:37.520 some consolidation, some digestion. That said, I'm about as bullish 0:02:37.560 --> 0:02:39.600 as I can be on the intermediate to long term. 0:02:39.639 --> 0:02:42.600 I'm not sure who was expecting rate cuts to really 0:02:42.600 --> 0:02:45.520 take place in March at this point given the Fed speak, 0:02:45.639 --> 0:02:49.239 and then finally the pain trade has really felt up 0:02:49.480 --> 0:02:52.000 not down. Today could change that. I think if we 0:02:52.080 --> 0:02:54.720 get to a four and a half percent level on 0:02:54.760 --> 0:02:58.120 the tenure, that's an important point of demarcation psychologically and 0:02:58.160 --> 0:02:59.239 also for valuations. 0:02:59.480 --> 0:03:02.440 What was in thing is basically how all in investors 0:03:02.440 --> 0:03:04.640 seem to have been going in tech stocks, particularly at 0:03:04.639 --> 0:03:06.280 the end of last week. Bank of America, as they 0:03:06.280 --> 0:03:09.360 always do, really dictating the flows that they've been seeing, 0:03:09.680 --> 0:03:12.040 and the fact that basically everyone has gone along this 0:03:12.080 --> 0:03:12.800 particular sector. 0:03:12.840 --> 0:03:14.520 Are we just seeing too much of a crowded trade 0:03:14.520 --> 0:03:15.280 at the moment. 0:03:15.800 --> 0:03:18.600 We're seeing some crowding. We're seeing some signs of exuberance, 0:03:18.600 --> 0:03:20.440 but I think what we also saw was the fact 0:03:20.440 --> 0:03:23.959 that investors were really off sides for this move heading 0:03:24.000 --> 0:03:27.840 into it. There wasn't enough participation. We were seeing some chasing. Absolutely, 0:03:28.160 --> 0:03:30.799 I wouldn't call it abject crowding, but I would say 0:03:30.840 --> 0:03:34.640 that last year was a year of reset and also 0:03:34.720 --> 0:03:37.960 profitability improvements. We saw six hundred basis points of profitability 0:03:37.960 --> 0:03:40.760 improvement across software in particular, five hundred to six hundred. 0:03:40.960 --> 0:03:43.920 That was pretty impressive in a dicceleration year, and this 0:03:44.080 --> 0:03:48.120 year should actually be a year of revenue reacceleration, although 0:03:48.160 --> 0:03:50.640 SQL if the economy doesn't absolutely fall apart, which doesn't 0:03:50.680 --> 0:03:54.720 look like it. So I think investors are willing to 0:03:54.800 --> 0:03:57.280 anticipate some of that. We're seeing some signs they're willing 0:03:57.360 --> 0:03:59.240 to look out a little bit. We'll see how they 0:03:59.240 --> 0:03:59.880 feel in the spring. 0:04:01.680 --> 0:04:02.040 Hary. 0:04:02.360 --> 0:04:04.960 The root of that Boa survey that Caro is talking 0:04:04.960 --> 0:04:09.000 about is just optimism about global growth, right earnings in 0:04:09.040 --> 0:04:11.480 the context of a strong global economy. This is what 0:04:11.520 --> 0:04:14.160 Aaron Brown and PIMCO told the show earlier today. 0:04:14.200 --> 0:04:17.880 This is this you're still seeing this market where you 0:04:17.960 --> 0:04:20.800 have one sector like the tech sector, which is up 0:04:20.800 --> 0:04:24.160 forty percent, and you have another sector like healthcare, which 0:04:24.200 --> 0:04:27.479 delivered earnings down twenty percent. It's a huge bifurcation in 0:04:27.520 --> 0:04:30.039 the market right now, and I think that that really 0:04:30.080 --> 0:04:33.560 presents a lot of opportunity for equity investors. 0:04:34.640 --> 0:04:38.080 A huge bifurcation. Who even cares about inflation? Just go 0:04:38.160 --> 0:04:40.360 with the tech sector? Is that your attitude? 0:04:41.120 --> 0:04:43.479 Oh, I think you have to care about inflation to 0:04:43.920 --> 0:04:46.040 a degree. And again above four and a half percent, 0:04:46.200 --> 0:04:49.680 you start to see some incremental concern over technology. 0:04:49.720 --> 0:04:50.000 For sure. 0:04:50.040 --> 0:04:53.800 It's a terrific point by Aaron. I think if we 0:04:54.320 --> 0:04:57.120 see a real broadening out of the economy, and yes 0:04:57.120 --> 0:05:01.240 we've seen some sectors absolutely annihilated, those representrificpportunities. We think 0:05:01.279 --> 0:05:05.360 that as a firm at Clearbridge, I personally also tend 0:05:05.400 --> 0:05:08.040 to believe that as we move further through time toward 0:05:08.080 --> 0:05:10.560 the second half of this year, where I think we 0:05:10.640 --> 0:05:14.599 will see a point of inflection in technology, in part 0:05:14.680 --> 0:05:18.240 driven by AI, in part driven by initiatives around AI, 0:05:18.800 --> 0:05:22.640 you will also see tech do well ultimately, but tech 0:05:22.680 --> 0:05:24.400 will have to tread water for a period of time 0:05:24.440 --> 0:05:27.119 to the extent that either the tenure continues to rise, 0:05:27.400 --> 0:05:30.600 or the economy the market broadens out to other sectors. 0:05:30.640 --> 0:05:33.600 So I think we're I don't know that we have 0:05:33.680 --> 0:05:36.280 to ultimately have an either or, although we might have 0:05:36.320 --> 0:05:37.720 one on an interim basis. 0:05:38.480 --> 0:05:40.120 You go back to economics one oh one. 0:05:40.279 --> 0:05:44.720 The idea simply is that the FED uses rates and 0:05:44.839 --> 0:05:50.280 higher rates to dampen demand, right impact consumption. In a minute, 0:05:50.400 --> 0:05:51.720 Karen and I are going to go deep on some 0:05:51.760 --> 0:05:54.000 of the gig economy companies. If you look at Uber 0:05:54.160 --> 0:05:59.080 last week, there is no evidence that consumer demand really 0:05:59.440 --> 0:06:03.279 or corporate command is slowing down. So it puts into 0:06:03.320 --> 0:06:05.960 questionable what was the point of having higher rates? Right 0:06:06.000 --> 0:06:08.720 if that is the only mechanism available to them, What 0:06:08.720 --> 0:06:10.000 do you make of that thesis? 0:06:10.520 --> 0:06:13.880 Well, it's not the only mechanism available to them, and 0:06:13.920 --> 0:06:15.919 we're going to see liquidity coming out of the market 0:06:15.960 --> 0:06:19.080 over time. It could be a lag. It certainly was 0:06:19.080 --> 0:06:23.320 a hotter print. We're not at five percent. Five percent 0:06:23.320 --> 0:06:26.760 would be another story, but we'll see how things trend 0:06:26.760 --> 0:06:27.520 in the coming months. 0:06:28.000 --> 0:06:30.880 What I'm interested in is some of your individual companies 0:06:30.880 --> 0:06:33.720 that you call out, where you see the opportunities perhaps 0:06:33.720 --> 0:06:36.800 in this pullback to be putting more into like Microsoft, 0:06:37.120 --> 0:06:41.280 like Salesforce, Oracle. What is this a moment to think 0:06:41.320 --> 0:06:44.720 about corporate spending rather than perhaps consumer spending, which we 0:06:44.760 --> 0:06:46.719 are worried about, particularly if we start to see more job. 0:06:46.600 --> 0:06:47.560 Losses in the back of AI. 0:06:47.920 --> 0:06:51.599 Absolutely well, what I do like about technology in general 0:06:51.680 --> 0:06:54.400 is that I think we went through many recessions last year. 0:06:54.640 --> 0:06:57.560 Last year companies were concerned about recession. They were laying 0:06:57.560 --> 0:06:59.600 off people, they were optimizing costs, they went on a 0:06:59.640 --> 0:07:03.039 buyer's strike. This year, there's an imperative to spend. Even 0:07:03.080 --> 0:07:05.680 if you're not spending directly in AI, you need to 0:07:06.160 --> 0:07:08.640 lay the foundation to be able to leverage AI. So 0:07:08.720 --> 0:07:13.320 that's a lot of data related investments, harmonization, getting data 0:07:13.320 --> 0:07:16.120 in order, it's a lot of infrastructure investment. It's migration 0:07:16.240 --> 0:07:20.240 of the cloud. You're starting to see the signs of that. Interestingly, 0:07:20.440 --> 0:07:23.760 Data Dog a consumption name and consumption names tend to 0:07:23.880 --> 0:07:26.960 lead reported this morning they report in a much better number. 0:07:26.960 --> 0:07:31.000 They reported slight acceleration. They guide it extraordinarily conservatively in 0:07:31.000 --> 0:07:35.200 my view, and rightly so. But nonetheless, the stock is 0:07:35.240 --> 0:07:37.520 actually down less than the NASDAK I think less than 0:07:37.560 --> 0:07:40.400 the SMP and I think it's because investors can see 0:07:40.400 --> 0:07:43.200 the signs of this improvement, the signs of this need 0:07:43.240 --> 0:07:47.040 to spend. So if the economy again, if we see 0:07:47.320 --> 0:07:50.920 outsized layoffs, that will be more of an issue. So far, 0:07:51.040 --> 0:07:52.040 we're seeing the opposite. 0:07:52.280 --> 0:07:54.559 At dieta dog now down by one point two percent. 0:07:54.600 --> 0:07:57.160 It was off more than six percent at one point, 0:07:57.160 --> 0:07:59.640 but that needs at reaction, just pushing it back off 0:07:59.640 --> 0:08:00.600 to the and traded. 0:08:01.760 --> 0:08:01.960 Yeah. 0:08:01.960 --> 0:08:04.160 I think one final question I've got for Hillary is, Okay, 0:08:04.200 --> 0:08:06.600 we know the AI story, we know about inflation, and 0:08:06.640 --> 0:08:06.920 we know. 0:08:06.880 --> 0:08:07.520 About the FED. 0:08:07.760 --> 0:08:09.760 How much of a wild card is the election this 0:08:09.880 --> 0:08:11.480 year for the technology sector? 0:08:13.160 --> 0:08:13.320 Hm? 0:08:13.960 --> 0:08:16.680 Well, I have to imagine it's a bit of a 0:08:16.680 --> 0:08:22.200 wildcarde it was last time Trump was on the ballot, 0:08:22.680 --> 0:08:25.320 but it frankly will get closer. But it feels like 0:08:25.360 --> 0:08:27.320 an autrinity from now when I think about how these 0:08:27.360 --> 0:08:30.040 tech stocks moved here to day. So I'll look forward 0:08:30.040 --> 0:08:31.400 to coming on and discussing that with you. 0:08:31.480 --> 0:08:33.720 Vn Ed all right, we'll hit you up on that. 0:08:33.840 --> 0:08:37.680 Hillary Fish of Clearbridge Investments, great analysis of the macro picture. 0:08:37.720 --> 0:08:41.000 Thank you. Let's go from what is the macro to 0:08:41.080 --> 0:08:41.480 the micro? 0:08:41.559 --> 0:08:43.000 There's a lot of stories that are happening in the 0:08:43.080 --> 0:08:44.800 ernies context. One of the things I wrote about at 0:08:44.800 --> 0:08:46.520 the beginning of the week in the Tech Daily news 0:08:46.600 --> 0:08:47.800 letter was the gig economy. 0:08:48.120 --> 0:08:49.520 Uber had a blowout quarter. 0:08:49.960 --> 0:08:52.720 Now its competitors are up next, Lift down three percent 0:08:52.880 --> 0:08:55.360 earnings today after the bell Airbnb. 0:08:54.920 --> 0:08:57.320 As well later in the Weekdoor Dash. What do we 0:08:57.360 --> 0:08:58.520 actually know about the. 0:08:58.480 --> 0:09:01.320 Demand side for the gig economy but also the supply side. 0:09:01.360 --> 0:09:04.400 Let's go to Bloomberg's Natalie Lung who covers this feat 0:09:04.600 --> 0:09:07.960 for Bloomberg Technology. Uber really set the bar high, right 0:09:08.080 --> 0:09:10.960 because Lift lives in their shadows. So let's start there. 0:09:11.160 --> 0:09:13.880 What are you expecting this week from Lyft for Lift? 0:09:14.040 --> 0:09:18.080 Yes, as you mentioned, they're kind of in a tough 0:09:18.160 --> 0:09:21.240 spot in comparison to Uber, who has the scale of 0:09:21.360 --> 0:09:25.960 international markets and as well as scale in other verticals 0:09:26.000 --> 0:09:32.240 like delivery and advertising. So for Lift, their performance, based 0:09:32.280 --> 0:09:36.280 on analyst estimates pretty conservative. Some analysts say they could 0:09:36.360 --> 0:09:39.680 deliver a beat, But then the concern is also like 0:09:39.760 --> 0:09:43.959 how much can they balance in terms of offering incentives 0:09:43.960 --> 0:09:47.160 to get more drivers get more drivers over from Uber, 0:09:47.440 --> 0:09:52.120 and how much subsidies and that sense and so, and 0:09:52.360 --> 0:09:56.680 especially because they announced like a seventy percent pay guarantee 0:09:56.760 --> 0:10:01.480 last week to sort of more drivers onto the platform 0:10:01.520 --> 0:10:06.760 and other features like a better response on deactivation account deactivations, 0:10:06.960 --> 0:10:10.640 and so the conversation will be around how much can 0:10:10.679 --> 0:10:13.960 you do that and not like eat into the margins. 0:10:14.360 --> 0:10:17.040 Let's talk about margins when it comes to food delivery 0:10:17.600 --> 0:10:21.320 in Siicar, we're anticipating this is one of the most 0:10:21.360 --> 0:10:24.040 shortened stocks out there at the moment. I think forty 0:10:24.080 --> 0:10:26.719 percent of the free flowt is currently being better against 0:10:27.040 --> 0:10:28.000 one of the worries here. 0:10:28.520 --> 0:10:28.679 Right. 0:10:28.840 --> 0:10:33.640 It's definitely again around the competition. So Uber door Dash 0:10:33.760 --> 0:10:38.160 they have they have not only just grocer delivery, they 0:10:38.240 --> 0:10:41.960 also the majority of the business is restaurant meals takeout, 0:10:42.120 --> 0:10:44.600 and so they do have that scale there which Instacart 0:10:44.640 --> 0:10:47.959 may be more limited right now. And also international ubers 0:10:48.240 --> 0:10:50.960 in a lot of international markets. DoorDash is in some 0:10:51.000 --> 0:10:54.240 parts of Europe and instacart is mostly in the US Canada. 0:10:54.280 --> 0:10:57.079 So the growth rate there in terms of orders of 0:10:57.200 --> 0:11:00.400 grosse transaction value will be of interest. Whether that can 0:11:01.520 --> 0:11:06.240 reaccelerate will be definitely If Chris, it's. 0:11:06.160 --> 0:11:10.280 The economy week lift kicking ourself after the bell this afternoon, Bloombgs, 0:11:10.360 --> 0:11:11.600 Natalie Lung, thank you so much. 0:11:12.040 --> 0:11:12.520 Firefly. 0:11:12.640 --> 0:11:16.079 It's Adobe's new flagship AI product that has been seen 0:11:16.200 --> 0:11:18.040 as perhaps a bit of a late comer to the 0:11:18.160 --> 0:11:20.480 likes of Mid Journey in Dahli, but now the company 0:11:20.559 --> 0:11:24.479 is banking one aspect that as competitors lack a commercially 0:11:24.600 --> 0:11:28.040 safe data set which provides IP guards, including legal support 0:11:28.040 --> 0:11:29.360 if anyone tries to sue them. 0:11:29.520 --> 0:11:31.679 Let's bring in Bloombogs Brodie Ford for more on this. 0:11:31.720 --> 0:11:34.560 And look, it's not exactly a sexy growth story to 0:11:34.600 --> 0:11:35.320 a certain extent. 0:11:35.480 --> 0:11:37.120 It's more about, look, we've got you. 0:11:37.360 --> 0:11:39.679 If you're a big client and you want legal protection, 0:11:40.160 --> 0:11:40.959 you got it with us. 0:11:42.240 --> 0:11:46.119 Yeah, everyone knows the story of your big tech incumbent 0:11:46.400 --> 0:11:49.439 and then this cool startup comes and smokes you. Right, 0:11:49.480 --> 0:11:52.080 and everyone thought out what would happen with open Ai 0:11:52.800 --> 0:11:56.280 in mid Journey with the image creations. But Anooahi has 0:11:56.280 --> 0:11:59.200 been coming out saying you're going to get sued right 0:11:59.280 --> 0:12:02.719 unless you us use these other guys. What's going to 0:12:02.800 --> 0:12:06.000 happen is they sucked in images from across the Internet 0:12:06.280 --> 0:12:10.720 with no copyright. It's a legal hazard. That's the argument. 0:12:10.760 --> 0:12:13.839 They've made, and so they've trained their system on their 0:12:13.840 --> 0:12:16.800 own Adobe stock, meaning that they have their own rights 0:12:16.800 --> 0:12:20.520 to use it. Obviously, some of the creators might not 0:12:20.760 --> 0:12:24.480 love that. There's probably still some legal dispute, but so 0:12:24.720 --> 0:12:28.640 far this pitch appears to be working with many big corporations. 0:12:30.040 --> 0:12:32.520 You give the example in the BusinessWeek piece of them 0:12:32.559 --> 0:12:36.960 commissioning photographers like eighty Bucks to go out and photograph animals, 0:12:36.960 --> 0:12:39.480 and the animals specifically are not allowed to wear clothes, 0:12:39.520 --> 0:12:42.240 which is what fun is that. The thing that always 0:12:42.240 --> 0:12:44.760 surprises me about Adobe, right Brodie, is that it is 0:12:44.800 --> 0:12:48.840 in the top forty biggest publicly traded companies in the world. 0:12:49.240 --> 0:12:52.079 And what it has in common with Microsoft is it's 0:12:52.120 --> 0:12:55.280 got a very good track record of selling subscriptions on 0:12:55.400 --> 0:12:58.280 software where you can get a similar tool for free 0:12:58.320 --> 0:13:01.760 pretty much anywhere will still pay for it. So let's 0:13:01.760 --> 0:13:03.439 go back to the intro. We said they want to 0:13:03.480 --> 0:13:07.000 be profitable. How do they plan to make firefly profitable? 0:13:08.320 --> 0:13:12.679 As you said, Adobe's creative cloud is very profitable. I 0:13:12.720 --> 0:13:14.240 mean I've had people say to me it's one of 0:13:14.320 --> 0:13:19.359 the most profitable things ever, not even just software, just products. 0:13:19.400 --> 0:13:22.600 It is a complete cash cout and it is not 0:13:22.880 --> 0:13:25.960 because it's the easiest to use or the cheapest, but 0:13:26.040 --> 0:13:28.600 because it works well together. Right, if you have a 0:13:28.640 --> 0:13:34.040 creative agency of a marketing agency, they need photo, video, audio, 0:13:34.080 --> 0:13:36.960 it needs to work well together. And now they need AI. 0:13:37.520 --> 0:13:40.680 And so Adobe's bet is that when they put AI 0:13:40.800 --> 0:13:43.880 into each one of these products, into the content supply 0:13:44.040 --> 0:13:46.920 chain as they call it, it'll work well together and 0:13:46.960 --> 0:13:49.440 people will be willing to pay extra for it, and 0:13:49.480 --> 0:13:52.439 more importantly, that they won't go to open AI or 0:13:52.480 --> 0:13:55.840 mid journey and then cancel their Photoshop subscription. I mean 0:13:55.920 --> 0:13:58.360 right now they're barely even charging for this. It's more 0:13:58.360 --> 0:14:02.559 of a plan that stay the ecosystem. 0:14:02.520 --> 0:14:04.199 And within Adobe. 0:14:04.240 --> 0:14:08.360 Inside Adobe, though, there are employees and staff that are 0:14:08.400 --> 0:14:13.040 worried about that ecosystem and the creatives that'll operate within it. 0:14:14.440 --> 0:14:14.600 Well. 0:14:14.679 --> 0:14:17.800 Yeah, there's a funny story we hear. We have it 0:14:17.840 --> 0:14:20.360 in the story about you know, there's a presentation in 0:14:20.400 --> 0:14:23.920 twenty nineteen. Someone is saying, listen, you guys, you are 0:14:24.000 --> 0:14:26.960 going to get disrupted if you don't take this stuff seriously, 0:14:27.440 --> 0:14:31.440 and the executives in the room being like, we're good, 0:14:32.640 --> 0:14:35.480 They're not going to leave us, you can know. So yeah. 0:14:35.520 --> 0:14:39.160 I mean it's a classic story a big company doesn't 0:14:39.160 --> 0:14:42.160 invest enough in an emerging technology and gets disrupted. In 0:14:42.200 --> 0:14:45.080 one year ago, everyone expected this to be the case 0:14:45.120 --> 0:14:48.080 for Adobe. Today the picture is a little blurrier. I mean, 0:14:48.120 --> 0:14:51.800 their argument has been landing, and I talked to a 0:14:51.840 --> 0:14:53.560 lot of Wall Street types to say that the two 0:14:53.640 --> 0:14:56.080 companies who are going to see a material uplift this 0:14:56.160 --> 0:14:59.200 year from AI Microsoft first and then Adobe. 0:15:00.000 --> 0:15:02.080 You see that coming from our own boombug intelligence team 0:15:02.120 --> 0:15:04.080 members and thinking Anna Ragrana putting out a note this 0:15:04.120 --> 0:15:05.840 morning saying it over you can see a one billion 0:15:05.880 --> 0:15:09.000 dollar mid term generative AI lift at the moment in 0:15:09.040 --> 0:15:12.880 terms of creative cloud, is there still any ramifications from 0:15:13.000 --> 0:15:15.200 the big m and a deal that fell apart the Figma, 0:15:15.360 --> 0:15:19.920 the anticipation that they've been distracted by having to go 0:15:20.000 --> 0:15:22.680 through such legal wranglings rather than focusing in on what 0:15:22.800 --> 0:15:25.680 is for many, you know, the new electricity when it 0:15:25.720 --> 0:15:29.960 comes to data visa, the new way in which we're 0:15:30.040 --> 0:15:31.200 thinking about technology. 0:15:32.040 --> 0:15:35.240 The way most folks understand it is that Figma was 0:15:35.280 --> 0:15:39.000 supposed to transform Adobe, and then AI was supposed to 0:15:39.040 --> 0:15:42.560 transform Adobe. So the fact that Figma fell apart that 0:15:42.720 --> 0:15:45.320 means AI really has to work out. I mean a 0:15:45.360 --> 0:15:48.400 lot of their eggs are in this basket, and we 0:15:48.520 --> 0:15:51.600 haven't even touched on the idea that this technology might 0:15:51.720 --> 0:15:54.120 kind of disrupt their own user base, right, I mean, 0:15:54.160 --> 0:15:57.560 millions of people pay for these tools. Are they going 0:15:57.600 --> 0:15:59.520 to be out of work? Are they just going to 0:15:59.520 --> 0:16:01.680 want a general images and not need to pay Adobe? 0:16:01.760 --> 0:16:04.800 I mean, even those who are bullish on Adobe's AI 0:16:04.880 --> 0:16:08.560 efforts see that there is some potential for this to 0:16:08.680 --> 0:16:11.960 knock out a bit of their user base. So I mean, yeah, 0:16:12.160 --> 0:16:14.920 now that Figma's gone, this needs to work, and it 0:16:14.920 --> 0:16:18.840 appears to be at this moment, but there is uncertainty remaining. 0:16:20.080 --> 0:16:23.400 In Berg's Brady Ford with the Adobe AI deep dive. 0:16:23.480 --> 0:16:24.960 Thanks coming on the show Mate, Now coming up here 0:16:24.960 --> 0:16:28.360 on Bloomberg Technology. Elon Musk's X looks to compete with 0:16:28.360 --> 0:16:32.000 the likes of YouTube by adding new advertisers targeting features 0:16:32.000 --> 0:16:32.600 to the platform. 0:16:32.600 --> 0:16:33.760 Will bring you all those details. 0:16:33.800 --> 0:16:38.400 Next is the company also looking to glurin creators, Karl, 0:16:38.440 --> 0:16:39.080 what are you looking at? 0:16:39.520 --> 0:16:40.640 I love the story that we're watching. 0:16:40.680 --> 0:16:43.200 And this is a European company of course, ASML the 0:16:43.280 --> 0:16:44.320 most valuable. 0:16:44.080 --> 0:16:46.680 Tech stock in Europe. A little bit of pressure. 0:16:46.400 --> 0:16:49.120 Today at one point, some significant pressure, a so called 0:16:49.160 --> 0:16:51.840 fat finger. Basically an eriness trade, whether that's by a 0:16:51.880 --> 0:16:54.960 human or an algorithm, is what many are blaming for 0:16:55.000 --> 0:16:57.280 a seven percent plunge that we saw in the stock 0:16:57.520 --> 0:17:00.480 at the open. Now the URINEX the overall that it's 0:17:00.560 --> 0:17:02.080 on and said, look, that wasn't to blame. 0:17:02.080 --> 0:17:03.480 Had no alerts that were triggered. 0:17:03.600 --> 0:17:06.560 But now people are basically rather questioning the valuations that 0:17:06.560 --> 0:17:08.800 we've seen, the run up that you've seen on ASML 0:17:08.920 --> 0:17:11.040 and in SAP for example, or by two point eighther 0:17:11.040 --> 0:17:13.080 center for the last couple of trading days. There's a 0:17:13.119 --> 0:17:24.520 rumot technology time now for talking tech. First up Open 0:17:24.560 --> 0:17:27.119 AI CEO Sam Altman, but he said that the UAE 0:17:27.280 --> 0:17:30.400 could serve as the world's regulatory sandbox to test AI 0:17:30.440 --> 0:17:33.480 technologies and then lead to spearhead global rules limiting their use. 0:17:33.800 --> 0:17:35.520 The comments calm, of course, as Altman. 0:17:35.359 --> 0:17:37.680 Is calling investors in the Middle East for a Semiconductor 0:17:37.680 --> 0:17:42.600 initiative to advance AI. Meanwhile, X has won a dismissal 0:17:42.640 --> 0:17:45.400 of claims that it conspired to supply the Saudi government 0:17:45.640 --> 0:17:49.040 with confidential user information to identify a Sali man who 0:17:49.080 --> 0:17:51.960 was arrested, tortured and sentenced to twenty years in prison. 0:17:52.160 --> 0:17:54.600 That's for posting remarks critical of the government. Now, the 0:17:54.640 --> 0:17:57.080 person in question had alleged that the social media company 0:17:57.119 --> 0:17:59.639 conspired with the Kingdom of Saudi Arabia to violate the 0:17:59.760 --> 0:18:02.880 rack t Influenced and Corrupt Organizations Act and the Alien 0:18:03.040 --> 0:18:04.520 Taught Statute. 0:18:05.080 --> 0:18:07.000 Then, in a fura monex. 0:18:06.760 --> 0:18:10.600 Spaces, of course, Elon Musk told US Republican senators that 0:18:10.640 --> 0:18:14.360 there is no way in hell that Russian President Vladimir Putin. 0:18:14.119 --> 0:18:15.679 Could lose the war on Ukraine. 0:18:15.800 --> 0:18:19.040 It was also in that space's opponents of a Senate 0:18:19.040 --> 0:18:21.919 bill that will provide further assistance for Ukraine to continue 0:18:21.960 --> 0:18:24.720 battling the full scale Russian invasion, and of course began 0:18:24.960 --> 0:18:25.640 two years ago. 0:18:25.800 --> 0:18:28.600 Ed well, let's stick with X. 0:18:28.640 --> 0:18:32.800 Elon Musk's platform is adding you advertiser targeting features to 0:18:32.840 --> 0:18:37.199 better entice video creators and compete against YouTube, joining us 0:18:37.200 --> 0:18:40.240 with the details Bloomberg's Asia councin Asia. We reported this 0:18:40.359 --> 0:18:43.480 idea back in October. Right, so, Musk and Lindy Yakarino 0:18:43.880 --> 0:18:47.400 did their first ever join all hands in the company, 0:18:47.400 --> 0:18:50.479 and they said, our competitor in the future is going 0:18:50.520 --> 0:18:53.200 to be YouTube. And what's happened since October is all 0:18:53.240 --> 0:18:56.359 of these video focused developments, and that's what you've been 0:18:56.359 --> 0:18:59.560 writing about today exactly. 0:19:00.200 --> 0:19:02.720 Has been pushing into video hard, as you mentioned, must 0:19:02.720 --> 0:19:05.280 have been talking about this forever and now we're starting 0:19:05.320 --> 0:19:07.399 to see some realization of it. So, just in the 0:19:07.480 --> 0:19:10.560 past number of weeks, they've signed content partnerships with people 0:19:10.600 --> 0:19:13.600 like Don Lemon, former CNN anchor, and Tulsa Gabbert, who 0:19:13.640 --> 0:19:17.199 was the US representative and a presidential candidate. They signed 0:19:17.280 --> 0:19:19.879 content deals with them to produce shows and put them 0:19:19.920 --> 0:19:22.439 exclusively on X First. They did the same thing with 0:19:22.480 --> 0:19:26.439 the World Wrestling Entertainment so WWE, and they're continuing to 0:19:26.440 --> 0:19:28.600 push to go after creators. And now what we see 0:19:28.800 --> 0:19:31.880 is now they're giving advertisers more control to actually put 0:19:31.920 --> 0:19:34.480 their ads on the profile of a creator that they 0:19:34.760 --> 0:19:38.000 like in order to generate more revenue from them and 0:19:38.119 --> 0:19:41.280 just allow those advertisers to take advantage of the profile 0:19:41.320 --> 0:19:42.920 and the followers that these creators are going to bring 0:19:42.920 --> 0:19:43.679 to the platform. 0:19:43.920 --> 0:19:46.760 And also I expose to a certain extent, would it 0:19:46.800 --> 0:19:50.199 provide some certainty to an advertiser that I'm just putting 0:19:50.200 --> 0:19:54.439 my brand, my name, my message via one particular content 0:19:54.480 --> 0:19:56.960 creator rather than who knows where it ends up being. 0:19:56.840 --> 0:19:57.240 Next to it. 0:19:58.280 --> 0:20:01.160 Absolutely, I mean that's been a huge topic of conversation 0:20:01.240 --> 0:20:03.720