1 00:00:02,279 --> 00:00:05,520 Speaker 1: From the heart of where innovation, money and power colli 2 00:00:06,360 --> 00:00:10,879 Speaker 1: in Silicon Valley and beyond. This is Bloomberg Technology with 3 00:00:10,960 --> 00:00:28,120 Speaker 1: Emily Jay. I'm Emily Check in San Francisco, and this 4 00:00:28,160 --> 00:00:32,600 Speaker 1: is Bloomberg Technology. Coming up in the next hour. Market meltdown, stocks, SINC, 5 00:00:33,040 --> 00:00:36,879 Speaker 1: yields surge, investors getting jennery about whether the Fed can 6 00:00:36,960 --> 00:00:43,159 Speaker 1: fight inflation without plunging the economy into recession, plus a 7 00:00:43,240 --> 00:00:45,720 Speaker 1: m D getting caught in the sell off after surging 8 00:00:45,840 --> 00:00:48,040 Speaker 1: post earnings. We're gonna talk to a MDC at least 9 00:00:48,040 --> 00:00:50,520 Speaker 1: to sue about how she is still driving massive growth 10 00:00:50,520 --> 00:00:55,080 Speaker 1: amidst forty year inflation, lockdowns in China and an ongoing 11 00:00:55,160 --> 00:00:59,680 Speaker 1: chip crisis. And Uber shares down now multiple days in 12 00:00:59,680 --> 00:01:03,200 Speaker 1: a row despite releasing earnings early to avoid lists market 13 00:01:03,280 --> 00:01:07,000 Speaker 1: wipe out. Our conversation with Uber CEO Dara Kazra Shay 14 00:01:07,120 --> 00:01:10,560 Speaker 1: later this hour why he's confident about demands and consumers 15 00:01:10,680 --> 00:01:13,120 Speaker 1: on the road ahead. We will get to all of 16 00:01:13,160 --> 00:01:14,880 Speaker 1: that in a moment. Be first to look at the market. 17 00:01:14,959 --> 00:01:18,680 Speaker 1: Stocks plunge with bonds in a violent reversal from Wednesday. 18 00:01:18,840 --> 00:01:22,000 Speaker 1: The Fed's decision to raise rates initially boosted markets, but 19 00:01:22,120 --> 00:01:24,760 Speaker 1: tech stocks have since had one of their sharpest U 20 00:01:24,800 --> 00:01:27,640 Speaker 1: turns ever. Bloombergs at Ludlow here to break it all down, 21 00:01:27,720 --> 00:01:29,840 Speaker 1: and yeah, you're completely right. Only and the long list 22 00:01:29,880 --> 00:01:32,760 Speaker 1: of superlatives. Right then, has that one very tech heavy 23 00:01:32,800 --> 00:01:36,240 Speaker 1: index having its worst day since September twenty n y 24 00:01:36,280 --> 00:01:39,400 Speaker 1: s Fang plus index, Megacaps the US listed shares of 25 00:01:39,480 --> 00:01:42,800 Speaker 1: Chinese techcos having its worst day since September twenty twenty. 26 00:01:43,000 --> 00:01:45,919 Speaker 1: You look on that screen US tenure yield, the benchmark 27 00:01:46,080 --> 00:01:48,640 Speaker 1: ten year treasury with the yield about three percent for 28 00:01:48,680 --> 00:01:51,680 Speaker 1: the first time since November two thousand and eighteen. That's 29 00:01:51,720 --> 00:01:54,880 Speaker 1: just a snapshot in time. That's just Thursday session. It's 30 00:01:54,920 --> 00:01:57,640 Speaker 1: a complete U turn, as you say, reversal from what 31 00:01:57,680 --> 00:02:00,720 Speaker 1: we saw on Wednesday following that FED decision to raise 32 00:02:00,800 --> 00:02:03,360 Speaker 1: rates by fifty basis points in the commentary from FED 33 00:02:03,400 --> 00:02:05,840 Speaker 1: pal around that. In fact, you look at the NASA 34 00:02:05,920 --> 00:02:08,200 Speaker 1: one hundred over the course of two days, right, we 35 00:02:08,240 --> 00:02:10,600 Speaker 1: bring that up on the screen and just think about 36 00:02:10,639 --> 00:02:13,840 Speaker 1: the overnight change in psychology. We went to bed Wednesday 37 00:02:13,919 --> 00:02:17,359 Speaker 1: night thinking the Fed's got this fifty basis points in 38 00:02:17,520 --> 00:02:21,320 Speaker 1: line for the next few meetings. No discussion of a 39 00:02:21,360 --> 00:02:24,360 Speaker 1: seventy five basis point hike. The FED has this, they 40 00:02:24,400 --> 00:02:27,760 Speaker 1: can fight inflation without bringing us into recession. We wake 41 00:02:27,880 --> 00:02:30,639 Speaker 1: up and its complete different story. We're worried about stagflation. 42 00:02:30,680 --> 00:02:33,800 Speaker 1: We're worried about the FED doing enough to combat what 43 00:02:33,800 --> 00:02:36,079 Speaker 1: we're seeing with the inflation picture. But also there was 44 00:02:36,120 --> 00:02:38,440 Speaker 1: a lot of fighting talk from Power. Write Emily. He's 45 00:02:38,440 --> 00:02:41,360 Speaker 1: talking about the strength of the economy, the tight labor market. 46 00:02:41,639 --> 00:02:43,959 Speaker 1: And then we have earning season corporate America hearing some 47 00:02:44,040 --> 00:02:47,679 Speaker 1: really positive noises. Hard to get my head around, indeed, 48 00:02:47,720 --> 00:02:50,480 Speaker 1: and you know there are a number of former FED 49 00:02:50,560 --> 00:02:53,400 Speaker 1: officials who didn't agree that this was enough and that 50 00:02:53,480 --> 00:02:56,880 Speaker 1: this would be plunging the economy into a recession. I 51 00:02:56,919 --> 00:03:00,280 Speaker 1: spoke with Uber CEO dar Kazra Shahi earlier today about 52 00:03:00,280 --> 00:03:03,280 Speaker 1: their earnings results. We've seen their stock slide now multiple 53 00:03:03,320 --> 00:03:06,280 Speaker 1: days in a row, despite a different picture from lift. 54 00:03:06,320 --> 00:03:10,840 Speaker 1: Take a listen to his reaction. We're focused on what 55 00:03:10,919 --> 00:03:14,120 Speaker 1: we can control. Can we build a great service UH 56 00:03:14,160 --> 00:03:18,880 Speaker 1: and can we ride the reopening, both in terms of growth, 57 00:03:18,880 --> 00:03:22,919 Speaker 1: bookings growth, profit growth, ultimately free cashul growth and the 58 00:03:23,000 --> 00:03:25,519 Speaker 1: answer based on a results and based on what we 59 00:03:25,560 --> 00:03:30,160 Speaker 1: see going forward as a resounding yes. And what do 60 00:03:30,200 --> 00:03:32,919 Speaker 1: you make of that? Yeah, well, the share performance speaks 61 00:03:32,919 --> 00:03:35,080 Speaker 1: for itself. You know, they gave a pretty bullish outlook 62 00:03:35,320 --> 00:03:37,880 Speaker 1: the demand is coming, you know, and echoed what Lift 63 00:03:37,960 --> 00:03:39,840 Speaker 1: was saying, and yet they had their worst two day 64 00:03:39,920 --> 00:03:42,000 Speaker 1: drop on uber stock since March. They were kind of 65 00:03:42,000 --> 00:03:45,080 Speaker 1: caught up in the contagion we've lift. There's no hiding 66 00:03:45,080 --> 00:03:47,080 Speaker 1: place here, right, Let's look at the megacaps and how 67 00:03:47,120 --> 00:03:49,040 Speaker 1: some of the biggest names in the world of technology 68 00:03:49,320 --> 00:03:52,240 Speaker 1: performed on Thursday. Some of the worst performers on then 69 00:03:52,240 --> 00:03:54,200 Speaker 1: as that one hundred. I had to look twice on 70 00:03:54,280 --> 00:03:56,920 Speaker 1: my Bloomberg, but this was the worst day for Apple 71 00:03:57,240 --> 00:04:01,520 Speaker 1: and Microsoft since October. You know, they're not just sensitive 72 00:04:01,560 --> 00:04:04,560 Speaker 1: to what we're saying with higher rates, rising yields, but 73 00:04:04,560 --> 00:04:06,480 Speaker 1: there's also now a discussion about well, what's going on 74 00:04:06,520 --> 00:04:09,440 Speaker 1: with supply chains globally and the situation we're trying to lockdowns. 75 00:04:09,840 --> 00:04:11,480 Speaker 1: You've got a pretty good guest come up next to you, 76 00:04:11,880 --> 00:04:15,240 Speaker 1: has a strong view of ninety strong indeed ed, thank 77 00:04:15,280 --> 00:04:18,440 Speaker 1: you well. It was a nightmare on Elm Street day 78 00:04:18,520 --> 00:04:21,200 Speaker 1: for the nastack. That's how my next guest is framing 79 00:04:21,440 --> 00:04:24,600 Speaker 1: today's sell off, Dan i'ves, managing director of Rubbush Securities, 80 00:04:24,640 --> 00:04:27,600 Speaker 1: joins me. Now, so Dan, what's your take on just 81 00:04:27,720 --> 00:04:29,600 Speaker 1: how bad this nightmare is gonna get and how long 82 00:04:29,600 --> 00:04:33,279 Speaker 1: it's gonna last. I mean, look today, if you look 83 00:04:33,400 --> 00:04:37,040 Speaker 1: at I'll call you the declines relative to the advances 84 00:04:37,080 --> 00:04:40,200 Speaker 1: over I mean just to sell off. I view it 85 00:04:40,240 --> 00:04:43,520 Speaker 1: almost we're nearing some sort of capitulation stage. I mean, 86 00:04:43,880 --> 00:04:48,240 Speaker 1: my conversations with tech investors were so negative today it's 87 00:04:48,279 --> 00:04:51,640 Speaker 1: almost bullish, and I think I just continue to point 88 00:04:51,680 --> 00:04:55,640 Speaker 1: to this is just a white knuckle period post fed 89 00:04:56,080 --> 00:04:58,000 Speaker 1: that I believe we're going to look back and some 90 00:04:58,080 --> 00:05:00,919 Speaker 1: of these quality tech is way over sold. You know, 91 00:05:01,040 --> 00:05:03,360 Speaker 1: if you're willing to hold it through this roller coaster, 92 00:05:04,120 --> 00:05:08,760 Speaker 1: why is it hitting tech harder than other sectors. I 93 00:05:08,760 --> 00:05:10,680 Speaker 1: think it's a few things. I think. First off, I 94 00:05:10,680 --> 00:05:13,640 Speaker 1: mean you're seeing a de leveraging degressing across the board, 95 00:05:14,040 --> 00:05:17,120 Speaker 1: and obviously a lot of institutions really wellevert to tach. 96 00:05:17,720 --> 00:05:19,520 Speaker 1: I think the other thing is that with all these 97 00:05:19,600 --> 00:05:23,600 Speaker 1: high multiple names and even ones that that that are 98 00:05:23,600 --> 00:05:27,320 Speaker 1: not even expensive names like Apple, Microsoft, in my opinion, 99 00:05:27,680 --> 00:05:29,919 Speaker 1: you're just seeing right now the street being like Okay, 100 00:05:29,960 --> 00:05:33,400 Speaker 1: I don't believe numbers into the next year. What am 101 00:05:33,440 --> 00:05:36,680 Speaker 1: I gonna pay? I'm totally uncertain. I'm just gonna sell 102 00:05:36,720 --> 00:05:39,839 Speaker 1: these names. And I could just tell you cover in 103 00:05:39,880 --> 00:05:42,520 Speaker 1: Tech twenty two years. The only time I've seen times 104 00:05:42,560 --> 00:05:45,520 Speaker 1: like this in O eight, o nine and even going 105 00:05:45,560 --> 00:05:47,480 Speaker 1: back to the early days of COVID. So I think 106 00:05:47,480 --> 00:05:49,840 Speaker 1: we're starting to get that panic stage. And then it's 107 00:05:49,839 --> 00:05:52,359 Speaker 1: like I talked about, mean you look at earning season, 108 00:05:52,440 --> 00:05:57,440 Speaker 1: it's it's to have and have nots but enterprise, cloud, cybersecurity, strong, 109 00:05:57,720 --> 00:06:00,920 Speaker 1: SEMIS because we as obvious at leasas who will talk 110 00:06:00,920 --> 00:06:04,839 Speaker 1: about strong, So of course the other side hugely we 111 00:06:05,040 --> 00:06:07,640 Speaker 1: e commerce and other names. But I think we are 112 00:06:07,680 --> 00:06:10,040 Speaker 1: starting to get to what I've view is in this 113 00:06:10,240 --> 00:06:13,919 Speaker 1: horror show opportunities. We saw Lift lose a third of 114 00:06:13,920 --> 00:06:16,880 Speaker 1: its market value yesterday and another gem from you you 115 00:06:17,000 --> 00:06:22,480 Speaker 1: called their spending guidance a nighties rock star like disaster. 116 00:06:23,000 --> 00:06:26,359 Speaker 1: Uh Uber shares also getting caught up in that here 117 00:06:26,440 --> 00:06:29,680 Speaker 1: despite a very different outlook. What do you make of 118 00:06:29,720 --> 00:06:34,120 Speaker 1: that look? I think if you look at Lift, I mean, 119 00:06:34,200 --> 00:06:37,560 Speaker 1: something just doesn't connect in terms of that conference college 120 00:06:37,320 --> 00:06:40,320 Speaker 1: I probably is probably one of the top three worst 121 00:06:40,320 --> 00:06:43,039 Speaker 1: conference calls I've heard in twenty plus years of Wow 122 00:06:43,240 --> 00:06:45,000 Speaker 1: doing this, and I think part of it is just 123 00:06:45,440 --> 00:06:49,240 Speaker 1: they couldn't explain why they're spending. The driver's shortage is there, 124 00:06:49,279 --> 00:06:52,360 Speaker 1: but even as you were talked about like, it's not 125 00:06:52,520 --> 00:06:55,160 Speaker 1: where it was six months ago, even nine months ago, 126 00:06:55,320 --> 00:06:58,359 Speaker 1: So spending so far ahead of this it was a 127 00:06:58,400 --> 00:07:00,880 Speaker 1: head scratcher. And you know, I when I look at 128 00:07:00,920 --> 00:07:04,279 Speaker 1: what Uber's doing, I think that obviously in sympathy because 129 00:07:04,680 --> 00:07:07,880 Speaker 1: these stocks trade almost starts being huts, you know, they're 130 00:07:07,880 --> 00:07:10,600 Speaker 1: almost combined in terms of how they trade and pandem. 131 00:07:10,880 --> 00:07:13,160 Speaker 1: I think Uber's way over so with clearly in the 132 00:07:13,200 --> 00:07:16,360 Speaker 1: investment penalty box and need to prove themselves. But I 133 00:07:16,400 --> 00:07:20,520 Speaker 1: think this was just way too aggressive spending that I'd 134 00:07:20,520 --> 00:07:23,120 Speaker 1: be surprised if they ultimately spend that when it's all 135 00:07:23,160 --> 00:07:25,960 Speaker 1: said done. Uh. In other news, I want to ask 136 00:07:26,000 --> 00:07:28,800 Speaker 1: you about this long list of unusual names that have 137 00:07:28,920 --> 00:07:33,160 Speaker 1: joined Elon Musk in his deal for Twitter. Larry Ellison, 138 00:07:33,200 --> 00:07:37,000 Speaker 1: who's of course on the Tesla board, Andreas and Horowitz, Sequoia, 139 00:07:37,520 --> 00:07:42,320 Speaker 1: the Qutar Investment Authority and Finance. What do you make 140 00:07:42,360 --> 00:07:45,400 Speaker 1: of how this is coming together. Look, I think in 141 00:07:45,720 --> 00:07:49,160 Speaker 1: this poker game, Musk obviously got Twitter and then ultimately 142 00:07:49,160 --> 00:07:52,600 Speaker 1: it was about the financing component to ultimately undo a 143 00:07:52,600 --> 00:07:55,760 Speaker 1: bit of his burden in terms of whoeveraging his Tesla stock, 144 00:07:55,840 --> 00:07:58,000 Speaker 1: both in the debt and the equity. Look, this is 145 00:07:58,000 --> 00:08:01,040 Speaker 1: a who's who in terms of who he got, you know, 146 00:08:01,080 --> 00:08:04,800 Speaker 1: from both coasts and even globally. Ellison obviously you know, 147 00:08:04,840 --> 00:08:07,600 Speaker 1: a huge confident. It is not a shock, but you 148 00:08:07,680 --> 00:08:10,880 Speaker 1: go through from injuries in a sequoia, the fidelity and others. 149 00:08:10,960 --> 00:08:13,400 Speaker 1: I think it also just shows Musk is not just 150 00:08:13,560 --> 00:08:16,920 Speaker 1: doing this aloon. He's going to have a team strategically, 151 00:08:17,280 --> 00:08:20,200 Speaker 1: even though you know in theory could be temporary CEO, 152 00:08:20,640 --> 00:08:23,080 Speaker 1: I think over time he moves more of a chairman role, 153 00:08:23,400 --> 00:08:27,520 Speaker 1: and I think that's something that even on an overreaction today, 154 00:08:27,640 --> 00:08:32,679 Speaker 1: his golden child continues to be Tesla. All Right, Dannas 155 00:08:33,000 --> 00:08:36,960 Speaker 1: web Bush As always appreciate you joining us and your metaphors. 156 00:08:45,640 --> 00:08:48,559 Speaker 1: After surging post earnings to its best day in months, 157 00:08:48,640 --> 00:08:51,120 Speaker 1: A and D also getting pulled into the cell off 158 00:08:51,200 --> 00:08:54,920 Speaker 1: the chip maker posting more than five billion dollars for 159 00:08:54,960 --> 00:08:57,760 Speaker 1: the quarter and raising it's full of your forecast I 160 00:08:57,800 --> 00:08:59,880 Speaker 1: want to bring in a m D CEO, Lisa, so 161 00:09:00,160 --> 00:09:03,120 Speaker 1: now to talk more about her outlook. Lisa, thank you 162 00:09:03,240 --> 00:09:06,560 Speaker 1: as always for joining us. Look, we're seeing the highest 163 00:09:06,640 --> 00:09:10,319 Speaker 1: inflation in forty years, lockdowns in China, which is a 164 00:09:10,400 --> 00:09:13,480 Speaker 1: huge production hub for the chip industry, and a major 165 00:09:13,600 --> 00:09:16,000 Speaker 1: ongoing war. How is it that you are managing to 166 00:09:16,080 --> 00:09:21,640 Speaker 1: post se growth and raising your full yer forecast. Well, 167 00:09:21,760 --> 00:09:23,480 Speaker 1: first of all, Emily, it's great to be here with 168 00:09:23,600 --> 00:09:25,840 Speaker 1: you as always, and UM. As you said, there are 169 00:09:25,880 --> 00:09:27,920 Speaker 1: a lot of things that are going on UM, a 170 00:09:27,960 --> 00:09:30,360 Speaker 1: lot of differ disturbances around the world. But you know, 171 00:09:30,520 --> 00:09:33,680 Speaker 1: for us, it's really about focusing on our long term strategy, 172 00:09:34,000 --> 00:09:37,439 Speaker 1: delivering for customers and our partners, UM ensuring that we're 173 00:09:37,440 --> 00:09:40,280 Speaker 1: getting new products coming out. And you know, we have 174 00:09:40,880 --> 00:09:43,959 Speaker 1: a great strategy. We have a very very strong product 175 00:09:44,000 --> 00:09:47,120 Speaker 1: portfolio for this year, and we're excited about the growth 176 00:09:47,240 --> 00:09:48,920 Speaker 1: that we saw both in the first quarter and then 177 00:09:49,000 --> 00:09:51,600 Speaker 1: more importantly what we see going forward. You know, it's 178 00:09:51,600 --> 00:09:54,719 Speaker 1: a it's a really great time to be in UM. 179 00:09:54,840 --> 00:09:56,880 Speaker 1: You know, the high performance computing market and this is 180 00:09:56,920 --> 00:09:59,880 Speaker 1: where our focus is. So yeah, we were very unhappy 181 00:10:00,000 --> 00:10:02,920 Speaker 1: with the growth that we're seeing big tech is underwater. 182 00:10:03,040 --> 00:10:05,640 Speaker 1: A m D got caught up in the sell off today. 183 00:10:06,360 --> 00:10:08,920 Speaker 1: What are you preparing for in terms of how you 184 00:10:09,040 --> 00:10:15,400 Speaker 1: plan to navigate a very uncertain macro environment. Well, you know, Emily, 185 00:10:15,440 --> 00:10:18,000 Speaker 1: I think the important thing is for us to focus on, 186 00:10:18,280 --> 00:10:19,880 Speaker 1: you know, the big picture. I mean, you know, a 187 00:10:20,000 --> 00:10:22,360 Speaker 1: m D today is such a different company than we 188 00:10:22,440 --> 00:10:24,800 Speaker 1: were even just a few years ago. You know, we 189 00:10:24,880 --> 00:10:28,640 Speaker 1: completed our acquisition of zy Links, which has you know, um, 190 00:10:28,840 --> 00:10:31,439 Speaker 1: you know, a set of markets that are a diverse 191 00:10:31,480 --> 00:10:33,400 Speaker 1: set of markets. And then when you add that to 192 00:10:33,520 --> 00:10:35,960 Speaker 1: our data center strategy and the progress that we've made 193 00:10:36,000 --> 00:10:38,199 Speaker 1: in the data center, I think, you know, what we're 194 00:10:38,240 --> 00:10:41,160 Speaker 1: really doing is trying to navigate. Yes, there are um 195 00:10:41,200 --> 00:10:44,640 Speaker 1: a set of macro issues and and also geographic issues 196 00:10:44,679 --> 00:10:47,839 Speaker 1: that we're dealing with, but fundamentally, people need more high 197 00:10:47,920 --> 00:10:51,880 Speaker 1: performance processors and more technology and that's what we do. 198 00:10:52,320 --> 00:10:54,240 Speaker 1: And so it is very much about you know, having 199 00:10:54,360 --> 00:10:58,520 Speaker 1: a long term strategy, a very diversified set of markets, 200 00:10:58,800 --> 00:11:01,559 Speaker 1: and ensuring that we're focus on execution every single day 201 00:11:01,600 --> 00:11:04,880 Speaker 1: to deliver to our customers. So the biggest problem in 202 00:11:04,960 --> 00:11:07,920 Speaker 1: the chip industry has continued to be supply, not matching 203 00:11:08,000 --> 00:11:10,280 Speaker 1: up with demand, and you made a decision to outsource 204 00:11:10,320 --> 00:11:13,280 Speaker 1: to t SMC, which has been widely credited for some 205 00:11:13,480 --> 00:11:16,360 Speaker 1: of you know, a MD's recent success. You know, when 206 00:11:16,440 --> 00:11:19,559 Speaker 1: you look ahead, do you see being able to have 207 00:11:19,760 --> 00:11:22,520 Speaker 1: enough supply to support all this growth, all of this 208 00:11:22,640 --> 00:11:25,439 Speaker 1: demand that you're seeing. Well, I have to say, Emily, 209 00:11:25,520 --> 00:11:28,000 Speaker 1: we've been working on you know, sort of ramping up 210 00:11:28,040 --> 00:11:30,400 Speaker 1: supply for the last eighteen months. I think, you know, 211 00:11:30,520 --> 00:11:33,200 Speaker 1: even pre pandemic. Uh. You know, we knew that our 212 00:11:33,240 --> 00:11:35,520 Speaker 1: strategy meant that we would grow um, you know, very 213 00:11:35,559 --> 00:11:38,360 Speaker 1: substantially over the next few years. We've been working with 214 00:11:38,480 --> 00:11:40,760 Speaker 1: our partners, UM, not just on the wafer side, of course, 215 00:11:40,840 --> 00:11:43,199 Speaker 1: on the wafer side, but also um, you know, the 216 00:11:43,280 --> 00:11:46,199 Speaker 1: back end side, substrate capacity, back in capacity, all the 217 00:11:46,280 --> 00:11:49,280 Speaker 1: components that you need and UM, yes, we've been able 218 00:11:49,360 --> 00:11:52,640 Speaker 1: to bring on a significant amount of capacity and that's 219 00:11:52,679 --> 00:11:55,400 Speaker 1: what helped us grow you know so much. You're last year, 220 00:11:55,760 --> 00:11:57,920 Speaker 1: UM as well as this first quarter, and you know 221 00:11:58,040 --> 00:12:01,800 Speaker 1: for the rest of the year, we're forecast six annual growth. 222 00:12:01,920 --> 00:12:04,120 Speaker 1: So we are bringing on a lot of capacity and 223 00:12:04,600 --> 00:12:07,240 Speaker 1: it is something that is very strategic for us, not 224 00:12:07,400 --> 00:12:11,680 Speaker 1: just this year, but into and beyond. The data center 225 00:12:11,760 --> 00:12:13,920 Speaker 1: has been a huge success story for you. How much 226 00:12:13,960 --> 00:12:16,599 Speaker 1: of this demand is coming from big cloud providers like 227 00:12:16,679 --> 00:12:21,560 Speaker 1: AWS and Microsoft versus increasing demand from other companies building 228 00:12:21,600 --> 00:12:25,480 Speaker 1: out their own data centers. Yeah, so the data center 229 00:12:25,520 --> 00:12:27,960 Speaker 1: has been our big strategic bet Emily over the last 230 00:12:28,000 --> 00:12:31,520 Speaker 1: few years, and we've done extremely well with the largest 231 00:12:31,600 --> 00:12:33,640 Speaker 1: hyper scale ers. You know, ten of the largest hyper 232 00:12:33,679 --> 00:12:37,000 Speaker 1: scalers UM are using a m D in very significant way, 233 00:12:37,120 --> 00:12:41,479 Speaker 1: both on internal workloads as well as their external facing workloads. 234 00:12:41,920 --> 00:12:45,040 Speaker 1: We're also making a lot of progress with enterprise customers 235 00:12:45,080 --> 00:12:48,079 Speaker 1: and customers who are looking at building out a hybrid environment. 236 00:12:48,200 --> 00:12:50,719 Speaker 1: So you know that you know, we grew UM. You know, 237 00:12:50,800 --> 00:12:53,520 Speaker 1: we've basically doubled UM in the first quarter in the 238 00:12:53,640 --> 00:12:56,320 Speaker 1: overall data center, but we doubled in each of cloud 239 00:12:56,440 --> 00:12:59,000 Speaker 1: and enterprise. And what you're seeing there is there's just 240 00:12:59,120 --> 00:13:01,800 Speaker 1: a demand from more computing UM when you think about 241 00:13:01,840 --> 00:13:06,320 Speaker 1: digital transformation, business transformation, UM, all of the AI that's 242 00:13:06,360 --> 00:13:09,520 Speaker 1: out there. So there's continues to be very high demand 243 00:13:09,559 --> 00:13:12,360 Speaker 1: in the data center. Now, there's been speculation about the 244 00:13:12,440 --> 00:13:15,719 Speaker 1: PC market and whether it's hit a pandemic peak in 245 00:13:15,840 --> 00:13:19,000 Speaker 1: tel CEO, pat Gaalsinger very bullish on this. Are you 246 00:13:19,920 --> 00:13:22,439 Speaker 1: as bullish? Where do you think the PC market is 247 00:13:22,480 --> 00:13:26,520 Speaker 1: really headed? Sure? So, Emily, you know, in the context, um, 248 00:13:26,600 --> 00:13:29,240 Speaker 1: you know, the PC market had its best year, um. 249 00:13:29,360 --> 00:13:31,000 Speaker 1: You know, really last year. I mean it was a 250 00:13:31,120 --> 00:13:34,120 Speaker 1: very strong year for PCs. As you know, there was 251 00:13:34,280 --> 00:13:37,480 Speaker 1: a lot of need for you know, updated PCs and 252 00:13:37,640 --> 00:13:40,760 Speaker 1: the updated infrastructure, as you know, we were in in 253 00:13:40,800 --> 00:13:43,079 Speaker 1: the middle of the pandemic. When you look at this year, 254 00:13:43,559 --> 00:13:45,920 Speaker 1: we are taking a little bit more conservative of view 255 00:13:45,960 --> 00:13:48,160 Speaker 1: of the PC market. You know, we we believe that 256 00:13:48,240 --> 00:13:50,880 Speaker 1: will probably be down let's call it high single digits. 257 00:13:51,040 --> 00:13:53,200 Speaker 1: But even with that, we're talking about a market that's 258 00:13:53,240 --> 00:13:55,800 Speaker 1: gonna be over three hundred million units UM this year. 259 00:13:56,160 --> 00:13:58,360 Speaker 1: So my view of the PC market it's about which 260 00:13:58,440 --> 00:14:00,559 Speaker 1: segments that you're in, you know, sir. Only some of 261 00:14:00,640 --> 00:14:02,880 Speaker 1: the low end and some of the more consumer facing 262 00:14:03,440 --> 00:14:06,120 Speaker 1: UM areas of the PC market have taken a little 263 00:14:06,160 --> 00:14:08,440 Speaker 1: bit of a soft spot here in the first half 264 00:14:08,480 --> 00:14:10,319 Speaker 1: of the year. UM. I will say though, if you 265 00:14:10,360 --> 00:14:12,959 Speaker 1: think about commercial PCs, people are investing a lot in 266 00:14:13,080 --> 00:14:16,000 Speaker 1: I t UM still because they want the productivity. If 267 00:14:16,000 --> 00:14:18,840 Speaker 1: you look at high end premium UM PCs as well 268 00:14:18,880 --> 00:14:22,120 Speaker 1: as gaming PCs. There's actually good demand for those. So 269 00:14:22,240 --> 00:14:24,320 Speaker 1: I do the PC market as a very good market, 270 00:14:24,600 --> 00:14:26,360 Speaker 1: but one where you know, we do have to watch 271 00:14:26,480 --> 00:14:29,400 Speaker 1: some of the volatility that's that that is in there. Okay, 272 00:14:29,520 --> 00:14:31,600 Speaker 1: Now I have to ask about your reaction to the 273 00:14:31,640 --> 00:14:36,040 Speaker 1: Supreme Court's leaked draft opinion, which shows that Row versus 274 00:14:36,080 --> 00:14:39,000 Speaker 1: Wade could very well be overturned and soon. A MD 275 00:14:39,240 --> 00:14:41,960 Speaker 1: has a good portion of its workforce in Texas, where 276 00:14:42,520 --> 00:14:46,800 Speaker 1: you know, more aggressive anti abortion legislation has already been passed. 277 00:14:46,840 --> 00:14:49,120 Speaker 1: You've got companies like Salesforce that have offered to pay 278 00:14:49,160 --> 00:14:52,240 Speaker 1: for their employees to leave Texas if they want to. 279 00:14:52,520 --> 00:14:54,600 Speaker 1: How are you thinking about all of this as a 280 00:14:54,680 --> 00:14:59,040 Speaker 1: business leader? Well, Emily, look, we're certainly watching the developments 281 00:14:59,120 --> 00:15:01,240 Speaker 1: very closely. I don't want to get ahead of the 282 00:15:01,280 --> 00:15:03,800 Speaker 1: actual ruling. I think they're there's still um, you know, 283 00:15:03,920 --> 00:15:06,640 Speaker 1: there's still some clarity to be brought. But you know, 284 00:15:06,720 --> 00:15:09,200 Speaker 1: our priorities always going to be first and foremost with 285 00:15:09,240 --> 00:15:12,640 Speaker 1: our employees and ensuring the health and safety of our employees. 286 00:15:12,680 --> 00:15:16,280 Speaker 1: So we're certainly watching the situation very carefully, and we'll 287 00:15:16,360 --> 00:15:18,200 Speaker 1: make sure that you know we're We're focused on our 288 00:15:18,240 --> 00:15:23,200 Speaker 1: employees and d CEO Lisa Sue. Thank you as always 289 00:15:23,240 --> 00:15:25,800 Speaker 1: for taking the time to join us. Thank you, good 290 00:15:25,840 --> 00:15:29,400 Speaker 1: to see you again. All right. Coming up, he helped 291 00:15:29,800 --> 00:15:33,640 Speaker 1: unionize the first Amazon warehouse in the United States. Christian 292 00:15:33,760 --> 00:15:37,520 Speaker 1: Smalls joins us next from Washington, fresh off his meeting 293 00:15:37,880 --> 00:15:57,480 Speaker 1: with President Biden. He's next. This is Bloomerk Amazon that 294 00:15:57,680 --> 00:16:01,240 Speaker 1: labor union president Christian Smalls test to find before members 295 00:16:01,280 --> 00:16:05,480 Speaker 1: of Congress today about his efforts to unionize workers across Amazon. He, 296 00:16:05,600 --> 00:16:07,880 Speaker 1: along with other union leaders, also just met at the 297 00:16:07,920 --> 00:16:10,800 Speaker 1: White House with President Biden, Vice President Harris, and Labor 298 00:16:10,880 --> 00:16:15,360 Speaker 1: Secretary Marty Walsh. He helped workers at an Amazon facility 299 00:16:15,400 --> 00:16:19,720 Speaker 1: on Staten Island become the first in the country to unionize. However, Monday, 300 00:16:20,120 --> 00:16:24,240 Speaker 1: a nearby Amazon facility voted against unionitation. He joins us 301 00:16:24,280 --> 00:16:27,200 Speaker 1: now live from Washington. Chris, great to have you back 302 00:16:27,280 --> 00:16:29,960 Speaker 1: here on the show. You tweeted that you met the 303 00:16:30,000 --> 00:16:33,400 Speaker 1: President earlier today and that he told you you got 304 00:16:33,520 --> 00:16:35,920 Speaker 1: him into trouble. Tell me a little bit about that 305 00:16:36,040 --> 00:16:39,560 Speaker 1: meeting and what you think he meant by that. Yeah, 306 00:16:39,600 --> 00:16:42,040 Speaker 1: I believe when he came out a couple of weeks 307 00:16:42,080 --> 00:16:44,480 Speaker 1: ago and said Amazon would coming for you. I think he, 308 00:16:45,160 --> 00:16:47,520 Speaker 1: uh he just overstepped it a little bit, and uh 309 00:16:47,560 --> 00:16:49,560 Speaker 1: he was svised he's sitting here and but you know, 310 00:16:49,640 --> 00:16:52,720 Speaker 1: it's great to see that. Uh he still recognizes that. 311 00:16:53,160 --> 00:16:55,720 Speaker 1: You know, we had to have some regulations with the 312 00:16:55,760 --> 00:16:59,240 Speaker 1: company as far as unionizing. So you also spoke with 313 00:16:59,280 --> 00:17:02,200 Speaker 1: President Harry By, President Harris Labor Secretary Marty Walsh. Should 314 00:17:02,200 --> 00:17:05,520 Speaker 1: they indicate if they're planning to get more actively involved 315 00:17:06,720 --> 00:17:11,760 Speaker 1: in Yes, absolutely, you know, Uh, well, we had a 316 00:17:11,800 --> 00:17:15,040 Speaker 1: great conversation. Uh. They spoke to not just myself, but 317 00:17:15,440 --> 00:17:19,240 Speaker 1: other leaders and organizers in other industries like Starbucks and 318 00:17:19,400 --> 00:17:25,360 Speaker 1: are e I and uh uh what else, Uh, artistic 319 00:17:26,040 --> 00:17:29,840 Speaker 1: industry as well. We had a librarian as there as well. 320 00:17:30,119 --> 00:17:32,520 Speaker 1: I'm gonna give recognition to all of them. Um. And 321 00:17:32,640 --> 00:17:35,680 Speaker 1: we definitely think that there's going to be some more 322 00:17:35,760 --> 00:17:38,480 Speaker 1: support coming from the political realm. Um. I know that 323 00:17:38,640 --> 00:17:42,280 Speaker 1: they have been mentioned that they have um implemented some 324 00:17:42,600 --> 00:17:45,480 Speaker 1: some things in the administration that they're willing to roll 325 00:17:45,520 --> 00:17:47,840 Speaker 1: out over the next couple of months. And that's going 326 00:17:47,880 --> 00:17:49,760 Speaker 1: to help us out on the ground. And I'm I'm 327 00:17:49,840 --> 00:17:53,240 Speaker 1: excited to be a part of that conversation. Now you're 328 00:17:53,280 --> 00:17:56,600 Speaker 1: testified before a Senate committee today, and I have a 329 00:17:56,680 --> 00:17:59,359 Speaker 1: portion of that testimony. This is your response to a 330 00:17:59,480 --> 00:18:04,400 Speaker 1: question from Senator Lindsey Graham. That's the reason why I'm 331 00:18:04,440 --> 00:18:08,159 Speaker 1: here to represent the workers who make these companies go. 332 00:18:09,280 --> 00:18:11,359 Speaker 1: And I think that it's in your best interest to 333 00:18:11,600 --> 00:18:15,000 Speaker 1: realize that it's not a a left or right thing. 334 00:18:15,119 --> 00:18:18,320 Speaker 1: It's not a Democrat or a Republican thing. So workers 335 00:18:18,400 --> 00:18:22,760 Speaker 1: things to workers issue, and we're the ones that are suffering. 336 00:18:25,359 --> 00:18:28,399 Speaker 1: What's your sense of whether the senators were speaking to 337 00:18:28,760 --> 00:18:32,200 Speaker 1: today understood that in a Congress that is often so 338 00:18:32,600 --> 00:18:38,080 Speaker 1: divided by partisanship. Yeah, I mean, well, I just had 339 00:18:38,160 --> 00:18:40,280 Speaker 1: to reiterate that, you know, I wanted to make them 340 00:18:40,440 --> 00:18:45,240 Speaker 1: understand that, you know, uh, our voices matter. You know, 341 00:18:45,400 --> 00:18:49,320 Speaker 1: the corporations get the UM have the first say and everything. 342 00:18:49,400 --> 00:18:52,680 Speaker 1: They get to control everything, whether it's the market, whether 343 00:18:52,760 --> 00:18:58,240 Speaker 1: it's uh the laws, lobbying whoever, it's uh, even the 344 00:18:58,359 --> 00:19:01,399 Speaker 1: government is some aspect. You know, we don't have a 345 00:19:01,520 --> 00:19:04,800 Speaker 1: say at the bottom as workers. UM. The only way 346 00:19:04,880 --> 00:19:07,560 Speaker 1: we have a say in the voices when we collectively 347 00:19:07,640 --> 00:19:11,399 Speaker 1: come together and when we collectively say we want the union, 348 00:19:11,960 --> 00:19:15,040 Speaker 1: UM that that right should be given to us, and UM, 349 00:19:15,200 --> 00:19:17,719 Speaker 1: that's what I want to make sure that that message 350 00:19:17,800 --> 00:19:20,480 Speaker 1: was clear cut that the workers are the ones who 351 00:19:20,920 --> 00:19:24,359 Speaker 1: generate the revenue for these corporations. And you know, I 352 00:19:24,440 --> 00:19:27,080 Speaker 1: think he uh he got the message because he didn't 353 00:19:27,119 --> 00:19:31,960 Speaker 1: last long. He left halfway through. But you know, I understand, 354 00:19:32,000 --> 00:19:35,160 Speaker 1: you know, this is uh something that has to be said, 355 00:19:35,200 --> 00:19:38,959 Speaker 1: It has to be spoken about. Now. You won at 356 00:19:39,040 --> 00:19:42,400 Speaker 1: one of the Staten Island warehouses. The union one Amazon though, 357 00:19:42,520 --> 00:19:45,560 Speaker 1: is appealing that decision and they said they were disappointed 358 00:19:45,600 --> 00:19:48,040 Speaker 1: with the outcome of the election there. They believe having 359 00:19:48,080 --> 00:19:51,600 Speaker 1: a direct relationship with the company the company employees, having 360 00:19:51,680 --> 00:19:55,280 Speaker 1: a direct relationship with the company is best for the employees. 361 00:19:55,840 --> 00:19:58,760 Speaker 1: You lost at a warehouse across the street. And I'm 362 00:19:58,840 --> 00:20:01,800 Speaker 1: curious where you plan to do this next, given that 363 00:20:02,880 --> 00:20:07,800 Speaker 1: clearly it's not necessarily a done deal. Yeah, we're we're 364 00:20:07,880 --> 00:20:11,120 Speaker 1: prepared on our side, UM to go to the core 365 00:20:11,240 --> 00:20:14,879 Speaker 1: hearing and hear out the evidence if uh there is some, 366 00:20:15,720 --> 00:20:19,359 Speaker 1: and we will take our actions from there. UM. Definitely 367 00:20:19,400 --> 00:20:22,120 Speaker 1: talking to our legal representation on our side to get 368 00:20:22,160 --> 00:20:25,639 Speaker 1: the best advice as far as our first election. But 369 00:20:26,119 --> 00:20:28,320 Speaker 1: at the same time. You know, Amazon should recognize the 370 00:20:28,400 --> 00:20:31,920 Speaker 1: fact that the Amazon workers at that facility voted for 371 00:20:32,080 --> 00:20:35,880 Speaker 1: the union in favor of the union over five hundred workers, um, 372 00:20:36,720 --> 00:20:41,040 Speaker 1: over five hundred ballots. Uh work where um the difference? 373 00:20:41,720 --> 00:20:45,120 Speaker 1: And as far as the second election, you know, we uh, 374 00:20:45,680 --> 00:20:48,600 Speaker 1: we definitely you know, overshotted a little bit. You know, 375 00:20:48,800 --> 00:20:51,680 Speaker 1: we we took on a huge task. We've been campaigning 376 00:20:51,720 --> 00:20:55,119 Speaker 1: for quite a while, over a year. Um. We had 377 00:20:55,160 --> 00:20:59,280 Speaker 1: a new facility, new workers, new organizers in that building, UM, 378 00:20:59,320 --> 00:21:01,840 Speaker 1: and they just didn't enough time to convince enough of 379 00:21:01,960 --> 00:21:05,440 Speaker 1: their co workers, which is understandable. So for us, we 380 00:21:05,560 --> 00:21:08,280 Speaker 1: just have to reassess and get back to work and 381 00:21:08,400 --> 00:21:11,080 Speaker 1: get back to organizing. So are we going to see 382 00:21:11,119 --> 00:21:15,200 Speaker 1: you filing union positions petitions outside Staten Island soon? And 383 00:21:15,240 --> 00:21:18,440 Speaker 1: if so, where quickly? Oh? Well, I can tell you 384 00:21:18,520 --> 00:21:20,960 Speaker 1: we're going nationwide. You know, every building in the country 385 00:21:21,000 --> 00:21:23,560 Speaker 1: has contacted us already, and we want to continue with 386 00:21:23,680 --> 00:21:25,919 Speaker 1: that plan to get everybody in the country set up. 387 00:21:28,280 --> 00:21:32,040 Speaker 1: You're saying, every Amazon warehouse in the country has contacted 388 00:21:32,080 --> 00:21:36,760 Speaker 1: you about the project of unionizing every Amazon facility in 389 00:21:36,800 --> 00:21:40,400 Speaker 1: the country, um, and then some has contacted the Amazon 390 00:21:40,480 --> 00:21:44,000 Speaker 1: LA reunion and we will have a conference that will 391 00:21:44,040 --> 00:21:49,760 Speaker 1: address everybody nationwide. All Right, Christian Smallst, President of the 392 00:21:49,880 --> 00:21:53,560 Speaker 1: Amazon Labor Union, Fresh Office meeting with President Biden. Thank 393 00:21:53,640 --> 00:22:04,639 Speaker 1: you Chris for trying to thank you. Welcome back to 394 00:22:04,680 --> 00:22:07,000 Speaker 1: Blomberg Technology, Emily check in San Francisco. I want to 395 00:22:07,000 --> 00:22:10,159 Speaker 1: get back to the market and volatility and starts spreading 396 00:22:10,160 --> 00:22:13,800 Speaker 1: to crypto. To our at Ludlow, been taking a look 397 00:22:13,840 --> 00:22:15,760 Speaker 1: there and what do you see, just another long list 398 00:22:15,840 --> 00:22:18,720 Speaker 1: of superlatives for bitcoin. This was the single biggest intra 399 00:22:18,800 --> 00:22:22,000 Speaker 1: day drop since January. And again it's a two day story, right, 400 00:22:22,080 --> 00:22:25,280 Speaker 1: a violent u turn because we saw bitcoin pushed towards 401 00:22:25,359 --> 00:22:28,760 Speaker 1: forty dollars per token following that FED decision to raise 402 00:22:28,840 --> 00:22:31,520 Speaker 1: rates by fifty basis points the commentary from FED chair 403 00:22:31,880 --> 00:22:35,200 Speaker 1: j Pale, and then we just drop off and we're 404 00:22:35,240 --> 00:22:39,159 Speaker 1: down back towards thirty six thousand dollars per token. In 405 00:22:39,280 --> 00:22:42,880 Speaker 1: this higher rate environment, bitcoins traded in a very narrow range. 406 00:22:42,920 --> 00:22:45,080 Speaker 1: It's struggled to break out of that range. We've never 407 00:22:45,160 --> 00:22:46,679 Speaker 1: really got back to the highs that we had at 408 00:22:46,680 --> 00:22:48,040 Speaker 1: the start of the year, and we saw other old 409 00:22:48,080 --> 00:22:51,800 Speaker 1: coins like Salana, for example, selling off during and ether 410 00:22:51,960 --> 00:22:55,920 Speaker 1: as well during the session on Thursday. Earning season continues though, 411 00:22:56,000 --> 00:22:57,800 Speaker 1: and there are some after hours movies that I want 412 00:22:57,800 --> 00:23:00,600 Speaker 1: to look at. Lucid reaffirming it scary idents to build 413 00:23:00,640 --> 00:23:03,159 Speaker 1: between twelve thousand and fourteen thousand vehicles this year, but 414 00:23:03,200 --> 00:23:06,440 Speaker 1: it's raising prices because supply chain issues are ongoing. The 415 00:23:06,480 --> 00:23:09,840 Speaker 1: stock trading water in after our zero really interesting, big 416 00:23:09,920 --> 00:23:11,840 Speaker 1: set off in zero down nine and a half percent, 417 00:23:12,320 --> 00:23:15,160 Speaker 1: tepid outlook, and the worry here is that higher rates 418 00:23:15,280 --> 00:23:18,399 Speaker 1: the Fed impacts mortgage rates and that could impact will 419 00:23:18,440 --> 00:23:20,760 Speaker 1: cool off the housing market. And look Block End. We 420 00:23:20,800 --> 00:23:22,919 Speaker 1: haven't spoken about Block in a while, right, formerly known 421 00:23:22,960 --> 00:23:25,880 Speaker 1: as Square up ten percent, and after hours they're talking 422 00:23:25,880 --> 00:23:29,040 Speaker 1: about strength in their traditional payments processing business. And very 423 00:23:29,119 --> 00:23:32,639 Speaker 1: quickly during the session Thursday, there were just two stocks 424 00:23:32,680 --> 00:23:36,399 Speaker 1: on the NASA in the green, one of them Booking 425 00:23:36,520 --> 00:23:41,200 Speaker 1: Holdings up three point three percent, earnings, bullish outlook, a 426 00:23:41,320 --> 00:23:44,440 Speaker 1: summer of travels coming Emily. But just a few day 427 00:23:44,560 --> 00:23:48,440 Speaker 1: days ago Expedia said exactly the same thing. They're down 428 00:23:48,560 --> 00:23:51,399 Speaker 1: six point seven percent on Thursday. M A lot of 429 00:23:51,720 --> 00:23:54,919 Speaker 1: narrative of Expedia recession fears might hit them, A lot 430 00:23:55,000 --> 00:23:56,840 Speaker 1: of love for booking, not really sure what's going on that? 431 00:23:56,960 --> 00:23:58,399 Speaker 1: All right, Well I got someone who might have an 432 00:23:58,440 --> 00:24:02,080 Speaker 1: opinion about that thing. You as ed said. Expedia shares 433 00:24:02,320 --> 00:24:05,359 Speaker 1: tumbling since their earnings report earlier this week. This is 434 00:24:05,440 --> 00:24:09,240 Speaker 1: rising inflation and a potential recession looms over the summer 435 00:24:09,280 --> 00:24:11,920 Speaker 1: travel season ahead. Joining me now, Peter Kurrent, Vice harre 436 00:24:11,920 --> 00:24:14,200 Speaker 1: and CEO of the Expedia group to talk about that 437 00:24:14,359 --> 00:24:16,760 Speaker 1: and more so. Look, Peter, you saw the chart. What's 438 00:24:16,800 --> 00:24:21,000 Speaker 1: your reaction to that. Yeah, I mean we weren't expecting it. 439 00:24:21,160 --> 00:24:25,000 Speaker 1: I think people are overreacting to, uh, some of the 440 00:24:25,600 --> 00:24:29,200 Speaker 1: inflation worries, some of the other travel players and concerns. 441 00:24:29,280 --> 00:24:32,640 Speaker 1: But we haven't seen any of any of the inflation 442 00:24:32,680 --> 00:24:36,840 Speaker 1: worries affecting the booking so far going into you know, 443 00:24:36,880 --> 00:24:39,720 Speaker 1: the summer season and in other and longer stays. So 444 00:24:40,680 --> 00:24:42,399 Speaker 1: we were a little surprised. We thought it was a 445 00:24:42,440 --> 00:24:44,840 Speaker 1: good quarter and uh, you know, I think I think 446 00:24:44,920 --> 00:24:48,960 Speaker 1: we expect a continued good travel season despite inflation concerns. 447 00:24:49,400 --> 00:24:51,639 Speaker 1: So there's no question that people want to travel, aken, 448 00:24:51,840 --> 00:24:58,320 Speaker 1: but at what point does inflation sap that demand? Yeah, 449 00:24:58,760 --> 00:25:01,000 Speaker 1: I think what we saw through COVID that you know, 450 00:25:01,040 --> 00:25:04,159 Speaker 1: on a macro basis, was a lot of savings in 451 00:25:04,280 --> 00:25:07,920 Speaker 1: most households. Uh and also and overspending consumer goods. And 452 00:25:08,000 --> 00:25:10,320 Speaker 1: what we're starting to what we've expected to see and 453 00:25:10,400 --> 00:25:12,639 Speaker 1: what we've been starting to see is a sort of 454 00:25:12,720 --> 00:25:17,080 Speaker 1: a fall back to norms and probably an overspend on services, 455 00:25:17,160 --> 00:25:21,119 Speaker 1: including travel and hospitality. So we've been expecting that, and 456 00:25:21,240 --> 00:25:24,640 Speaker 1: that seems to be playing out. Obviously long long term, 457 00:25:24,680 --> 00:25:27,720 Speaker 1: who knows on inflation, but in the near term, inflation 458 00:25:27,840 --> 00:25:31,560 Speaker 1: worries don't seem to be canceling people's ambition to travel, 459 00:25:31,800 --> 00:25:35,159 Speaker 1: whether they might maybe rewrite down what they're hoping to do, 460 00:25:35,359 --> 00:25:37,480 Speaker 1: you know, maybe not Paris but San Diego. You know, 461 00:25:37,600 --> 00:25:40,520 Speaker 1: we might see some of that. But again, we expect 462 00:25:40,560 --> 00:25:43,840 Speaker 1: people to travel regardless, and you know, we participate in 463 00:25:43,880 --> 00:25:47,800 Speaker 1: all segments of travel, and if if people travel a 464 00:25:47,920 --> 00:25:51,280 Speaker 1: little more modestly, you know, we'll pick that up. So 465 00:25:51,920 --> 00:25:54,200 Speaker 1: we we expected to be strong, at least for the 466 00:25:54,280 --> 00:25:57,640 Speaker 1: foreseeable future. So you saw a steep rise in bookings 467 00:25:57,720 --> 00:26:03,000 Speaker 1: compared to last year, but you're still not back to levels. 468 00:26:03,320 --> 00:26:06,080 Speaker 1: I spoke to Airbnb CEO Brian Chansky just yesterday. Somehow 469 00:26:06,119 --> 00:26:08,080 Speaker 1: he always comes on the day before you, so I 470 00:26:08,160 --> 00:26:11,240 Speaker 1: have to get your reaction to it. Uh. You know, 471 00:26:11,359 --> 00:26:13,600 Speaker 1: he talked about how they are now ahead of pre 472 00:26:13,720 --> 00:26:16,440 Speaker 1: pandemic levels even in cities. Take a listen to what 473 00:26:16,520 --> 00:26:19,800 Speaker 1: he had to say. Well, it's already fully I mean, 474 00:26:19,880 --> 00:26:23,520 Speaker 1: it's already above at this very moment with Airbnb. I 475 00:26:23,640 --> 00:26:25,879 Speaker 1: can't say it's above for everyone. I don't know if 476 00:26:25,920 --> 00:26:30,640 Speaker 1: hotels are back to planting levels, but we are next time, Peter, 477 00:26:30,720 --> 00:26:34,520 Speaker 1: you're gonna have to come on twenty four hours before hiking. 478 00:26:34,880 --> 00:26:36,800 Speaker 1: But either way, Look, what's you're reacting? You know, how 479 00:26:36,840 --> 00:26:41,440 Speaker 1: do you explain some of the differences that we're seeing. Sure, well, 480 00:26:41,560 --> 00:26:43,280 Speaker 1: a couple of things. One is, you know, we saw 481 00:26:43,560 --> 00:26:48,119 Speaker 1: very robust growth in our alternative commenta Inverbo during COVID, 482 00:26:48,280 --> 00:26:52,160 Speaker 1: as did Airbnb in segments, and as cities have come 483 00:26:52,200 --> 00:26:55,320 Speaker 1: back for them. Uh more. You know, cities aren't fully back, 484 00:26:55,440 --> 00:26:58,560 Speaker 1: but cities have done better in the last quarter. Uh 485 00:26:58,640 --> 00:27:01,119 Speaker 1: and so they're getting the benefit that Verbo for us 486 00:27:01,160 --> 00:27:04,480 Speaker 1: doesn't really participate in urban markets. So we've both been 487 00:27:04,520 --> 00:27:07,639 Speaker 1: strong throughout COVID, and I think the extra lift of 488 00:27:07,680 --> 00:27:10,560 Speaker 1: cities coming back put them into positive territory. But what 489 00:27:10,720 --> 00:27:13,720 Speaker 1: Brian referred to, which is true. Hotels are not fully 490 00:27:13,760 --> 00:27:17,159 Speaker 1: back across the globe. Not all geographies are back across 491 00:27:17,200 --> 00:27:19,920 Speaker 1: the globe. So our mix of business, which you know, 492 00:27:20,040 --> 00:27:22,239 Speaker 1: we have markets like in North America where we are 493 00:27:22,280 --> 00:27:25,000 Speaker 1: fully back and more, and we have markets like a 494 00:27:25,160 --> 00:27:28,560 Speaker 1: Pack that are still way under where they've been because 495 00:27:28,560 --> 00:27:31,760 Speaker 1: they're still largely closed down. So it's a mix of business. 496 00:27:31,840 --> 00:27:33,960 Speaker 1: And that's what the story has been really throughout most 497 00:27:34,000 --> 00:27:36,080 Speaker 1: of COVID, which is depending on where you were strong. 498 00:27:36,520 --> 00:27:38,480 Speaker 1: If you were in a strong place and the business 499 00:27:38,560 --> 00:27:40,800 Speaker 1: was there because of COVID, you did well. And as 500 00:27:40,960 --> 00:27:43,960 Speaker 1: COVID unravels and we start to see cities come back, 501 00:27:44,320 --> 00:27:47,520 Speaker 1: long haul international come back, you know, all the corridors 502 00:27:47,560 --> 00:27:51,000 Speaker 1: open geographically, that business will be back. We are definitely 503 00:27:51,080 --> 00:27:54,840 Speaker 1: back and more than back in many markets. You've got 504 00:27:54,920 --> 00:27:59,320 Speaker 1: some other news today unveiling your Expedia group Open World 505 00:27:59,560 --> 00:28:02,840 Speaker 1: ECONMMER platform. What is this and how is it going 506 00:28:02,920 --> 00:28:07,639 Speaker 1: to augment the broader business? Yeah, So, as you know, 507 00:28:07,760 --> 00:28:10,239 Speaker 1: we've talked before about how we've been re platforming our 508 00:28:10,320 --> 00:28:13,200 Speaker 1: technology to drive our own B two C business faster. 509 00:28:13,720 --> 00:28:15,959 Speaker 1: But what we realized in doing that was that if 510 00:28:16,000 --> 00:28:21,040 Speaker 1: We built our platform to be externalizable, essentially in micro services, 511 00:28:21,400 --> 00:28:24,800 Speaker 1: that we could provide the underpinnings for travel commerce for 512 00:28:24,920 --> 00:28:27,560 Speaker 1: really any players. We have a very robust B two 513 00:28:27,600 --> 00:28:31,159 Speaker 1: B business. We power lots of airlines selling rental cars 514 00:28:31,359 --> 00:28:35,760 Speaker 1: or packages. We power rewards programs, we power a RPS 515 00:28:35,800 --> 00:28:40,080 Speaker 1: travel program, many things, but these are big enterprise level deals. 516 00:28:40,600 --> 00:28:43,080 Speaker 1: What we're building now is an ability to sort of 517 00:28:43,760 --> 00:28:46,880 Speaker 1: take our whole stack and turn it into micro services. 518 00:28:46,960 --> 00:28:49,200 Speaker 1: So if if a partner just wants to use our 519 00:28:49,240 --> 00:28:53,400 Speaker 1: service capabilities or payment capabilities, or any parts of our 520 00:28:53,480 --> 00:28:56,560 Speaker 1: e commerce stack or the whole thing, or sell cars 521 00:28:56,720 --> 00:28:59,720 Speaker 1: or just activities or anything to augment their business, we 522 00:28:59,800 --> 00:29:02,600 Speaker 1: can provide that capability so that we think it's going 523 00:29:02,640 --> 00:29:05,440 Speaker 1: to dramatically expand the number of partners we can have 524 00:29:05,680 --> 00:29:08,200 Speaker 1: in our B two B universe, which ultimately expands how 525 00:29:08,240 --> 00:29:10,400 Speaker 1: much travel we can sell for our partners and how 526 00:29:10,440 --> 00:29:15,080 Speaker 1: many travelers we can serve. All right, Peter Kerr, Vice 527 00:29:15,080 --> 00:29:18,160 Speaker 1: Sharon CEO of the Expedia Group. Always good to have 528 00:29:18,440 --> 00:29:20,400 Speaker 1: your view of the future here on the show. Peter, 529 00:29:20,600 --> 00:29:25,120 Speaker 1: Thank you. Thanks Emily. Coming up Bitcoin plunging the most 530 00:29:25,200 --> 00:29:27,480 Speaker 1: in January, what's going on? There. We'll have all the 531 00:29:27,560 --> 00:30:01,640 Speaker 1: details next, Mrs Bloomberg. Let's get to our crypto report now. 532 00:30:01,760 --> 00:30:04,600 Speaker 1: With Bitcoin dropping the most into January, this is the 533 00:30:04,640 --> 00:30:08,520 Speaker 1: market route deepens and its concerns about a recession. Bloom 534 00:30:08,520 --> 00:30:12,000 Speaker 1: with Katie Greifeld here for more. Katie, take it away. Well, Emily, first, 535 00:30:12,040 --> 00:30:13,840 Speaker 1: I want to start big and just walk through what 536 00:30:14,040 --> 00:30:16,120 Speaker 1: a horrible day in markets this was. If you look 537 00:30:16,120 --> 00:30:18,840 Speaker 1: at the SMP five hundred, the biggest stock benchmark in 538 00:30:18,920 --> 00:30:22,840 Speaker 1: the world, it was down three point six percent today. Somehow, 539 00:30:22,920 --> 00:30:24,680 Speaker 1: that's only the worst day in a week. A lot 540 00:30:24,760 --> 00:30:26,880 Speaker 1: of that pain came in tech stocks, so the NAZAC 541 00:30:26,920 --> 00:30:30,720 Speaker 1: one hundred, that was its worst stay since September twenty. 542 00:30:30,800 --> 00:30:33,280 Speaker 1: A lot of that selling came in the biotech sector. 543 00:30:33,320 --> 00:30:35,080 Speaker 1: I saw a great stat today that if you look 544 00:30:35,120 --> 00:30:37,560 Speaker 1: at that sector, a fifth of it is worth less 545 00:30:37,800 --> 00:30:39,600 Speaker 1: than the cash it holds. But a lot of that 546 00:30:39,680 --> 00:30:42,680 Speaker 1: pain came in those speculative tech areas. You're looking at 547 00:30:42,720 --> 00:30:45,560 Speaker 1: the Arc Innovation a t F down eight point nine percent. 548 00:30:45,880 --> 00:30:48,840 Speaker 1: That's after it's it's biggest inflow in about a year 549 00:30:48,960 --> 00:30:51,160 Speaker 1: earlier this week. That's got to hurt. But yeah, a 550 00:30:51,240 --> 00:30:55,520 Speaker 1: lot of the action was in Bitcoin, the world's largest cryptocurrency, 551 00:30:55,600 --> 00:30:58,360 Speaker 1: down eight point four percent today. If you zoom out 552 00:30:58,400 --> 00:31:01,360 Speaker 1: and look over, you know, a five a period, it's 553 00:31:01,400 --> 00:31:03,720 Speaker 1: down eight point six per cent. So a lot of 554 00:31:03,760 --> 00:31:07,600 Speaker 1: that pain just came today and again. But if you 555 00:31:07,720 --> 00:31:11,480 Speaker 1: go back to the stock market, really really painful consumer discretionary, 556 00:31:11,800 --> 00:31:13,760 Speaker 1: a lot of selling in that sector, a lot of 557 00:31:13,800 --> 00:31:16,640 Speaker 1: selling in the e commerce names in particular. I'm thinking 558 00:31:16,640 --> 00:31:20,400 Speaker 1: about Amazon, I'm thinking about eBay and Tesla of course 559 00:31:20,640 --> 00:31:22,720 Speaker 1: also selling off in a big way with that text 560 00:31:22,720 --> 00:31:27,120 Speaker 1: sell off, So it wasn't just Bitcoin. To be clear, 561 00:31:27,320 --> 00:31:30,120 Speaker 1: just how broad based was this sell off, it was 562 00:31:30,160 --> 00:31:34,120 Speaker 1: pretty remarkable, Emily, really the space, the whole cryptocurrency ecosystem, 563 00:31:34,160 --> 00:31:36,720 Speaker 1: it tends to move as one. But most of the 564 00:31:36,960 --> 00:31:39,440 Speaker 1: losses came in Bitcoin, which I thought was interesting. If 565 00:31:39,480 --> 00:31:42,640 Speaker 1: you compare that to ethereum, for example, that's the second 566 00:31:42,760 --> 00:31:46,200 Speaker 1: largest cryptocurrency, it was only down six point four percent, 567 00:31:46,520 --> 00:31:50,320 Speaker 1: only being a relative term there. So yeah, Bitcoin sort 568 00:31:50,360 --> 00:31:53,200 Speaker 1: of the underperformer among the big coins. But if you've 569 00:31:53,280 --> 00:31:55,440 Speaker 1: broughten out and look at some of the old coins, 570 00:31:55,480 --> 00:31:58,360 Speaker 1: I'm thinking about Avalanche, I'm thinking about so Lana. Those 571 00:31:58,440 --> 00:32:01,800 Speaker 1: were down as much as fifteen percent at one point 572 00:32:01,880 --> 00:32:03,560 Speaker 1: at the worst of it. And again this is all 573 00:32:03,600 --> 00:32:07,040 Speaker 1: as we talk about the FED, the macro environment, liquidity 574 00:32:07,200 --> 00:32:09,600 Speaker 1: coming out of that syst the system. What does that 575 00:32:09,680 --> 00:32:12,280 Speaker 1: mean for cryptocurrencies? And it seems so far it's not 576 00:32:12,440 --> 00:32:15,560 Speaker 1: too good. And you know, let's talk a little bit 577 00:32:15,560 --> 00:32:17,959 Speaker 1: about some of the companies that have made bitcoin crypto 578 00:32:18,160 --> 00:32:20,960 Speaker 1: a part of their business in ways large and small. 579 00:32:21,200 --> 00:32:23,600 Speaker 1: How did this impact them? Well, I mean, we gotta 580 00:32:23,640 --> 00:32:25,719 Speaker 1: go straight to micro Strategy for that, right, I mean, 581 00:32:25,840 --> 00:32:29,080 Speaker 1: in what was interesting about the earnings report obviously Bitcoin, 582 00:32:29,120 --> 00:32:31,400 Speaker 1: they took a hit on their Bitcoin holdings. We know 583 00:32:31,560 --> 00:32:33,400 Speaker 1: that Bitcoin has had a rough couple of months. But 584 00:32:33,560 --> 00:32:36,760 Speaker 1: was really interesting was on the earnings call you heard 585 00:32:36,800 --> 00:32:40,440 Speaker 1: micro Strategy CFO line out that if Bitcoin falls to 586 00:32:40,600 --> 00:32:44,680 Speaker 1: twenty one dollars per coin, micro Strategy would face a 587 00:32:44,760 --> 00:32:46,840 Speaker 1: margin call at that point and probably have to sell 588 00:32:47,240 --> 00:32:49,800 Speaker 1: some of their Bitcoin holdings. Of course, Bitcoin it's not 589 00:32:50,040 --> 00:32:52,440 Speaker 1: close to their yet, it's still hovering around thirty six 590 00:32:52,520 --> 00:32:56,000 Speaker 1: thousand dollars a coin. But if this trend continues, and 591 00:32:56,080 --> 00:32:59,760 Speaker 1: the trend has been lower, we could get there conceivably. 592 00:33:00,880 --> 00:33:04,040 Speaker 1: All right, lots to watch ahead. Bloomberg's Katie Greifeld, thank 593 00:33:04,120 --> 00:33:14,920 Speaker 1: you for that update. When I get back to the 594 00:33:14,960 --> 00:33:16,680 Speaker 1: markets in a minute. But earlier I spoke with Uber 595 00:33:16,720 --> 00:33:19,600 Speaker 1: CEO dar kas Rasha. He asked for his reaction to 596 00:33:19,840 --> 00:33:23,640 Speaker 1: Uber shares taking a leg down even after releasing earnings 597 00:33:23,720 --> 00:33:29,400 Speaker 1: early to avoid comparisons to Lift, take a listen. I 598 00:33:29,480 --> 00:33:32,480 Speaker 1: think the reaction to Lift was significantly more negative than 599 00:33:32,640 --> 00:33:34,800 Speaker 1: than Uber. So maybe we're not in the same boat, 600 00:33:34,840 --> 00:33:38,440 Speaker 1: but it definitely affected us, and I do think we're 601 00:33:38,520 --> 00:33:41,200 Speaker 1: just in completely different places. You know. You see with 602 00:33:41,360 --> 00:33:45,360 Speaker 1: Uber is the benefit of scale, the benefit of globalization, 603 00:33:45,800 --> 00:33:49,840 Speaker 1: the benefit of diversification, and the benefit of discipline in 604 00:33:49,960 --> 00:33:52,800 Speaker 1: these in these markets. You know, we are by far 605 00:33:52,960 --> 00:33:55,280 Speaker 1: the number one player in the US have been for 606 00:33:55,400 --> 00:33:58,800 Speaker 1: some period of time. So when earners looked to come 607 00:33:58,880 --> 00:34:01,840 Speaker 1: back to the marketplace and start earning in a flexible way, 608 00:34:02,280 --> 00:34:05,120 Speaker 1: they're coming to Uber feet and that's a real advantage. 609 00:34:05,160 --> 00:34:07,080 Speaker 1: When they come to Uber, they're busy all the time, 610 00:34:07,200 --> 00:34:10,720 Speaker 1: not only driving people around, but also delivering or shopping, etcetera. 611 00:34:11,120 --> 00:34:13,600 Speaker 1: The opportunities to earn on the platform are greater than 612 00:34:13,680 --> 00:34:17,880 Speaker 1: ever and in a reopening scenario, a lot of advantage 613 00:34:17,920 --> 00:34:19,839 Speaker 1: comes to the number one player and the number two 614 00:34:19,880 --> 00:34:22,960 Speaker 1: player in this case left maybe having a hard time. 615 00:34:23,400 --> 00:34:27,800 Speaker 1: From a globalization standpoint, everyone knows that the reopening outside 616 00:34:27,840 --> 00:34:30,640 Speaker 1: of the US has happened much faster. So we have 617 00:34:30,760 --> 00:34:34,680 Speaker 1: been dealing with reopening dynamics bringing drivers back onto the platform. 618 00:34:34,760 --> 00:34:38,040 Speaker 1: We made big investments last year. For some period of time, 619 00:34:38,520 --> 00:34:40,960 Speaker 1: we've been used to this. We built muscles to do it, 620 00:34:41,360 --> 00:34:43,680 Speaker 1: and we're much more diversified so that we can you know, 621 00:34:43,880 --> 00:34:46,880 Speaker 1: lead into the West Coast which is reopening fast, while 622 00:34:47,239 --> 00:34:50,000 Speaker 1: you know the East Coast has lots of profitability. UK 623 00:34:50,239 --> 00:34:51,840 Speaker 1: all over the world, we have lots of profits to 624 00:34:51,920 --> 00:34:54,960 Speaker 1: pull from so that we can lean into reopenings. But 625 00:34:55,080 --> 00:34:57,440 Speaker 1: we're not too dependent on one place. We're just a 626 00:34:57,600 --> 00:35:01,320 Speaker 1: very different global player. And then from a different cecifically standpoint, 627 00:35:01,719 --> 00:35:04,000 Speaker 1: we've had delivered be a very very big part of 628 00:35:04,040 --> 00:35:07,600 Speaker 1: our business. And as with reopening, delivery growth rates, while 629 00:35:07,600 --> 00:35:11,600 Speaker 1: they're healthy, um, they're not growing quite as fast. So 630 00:35:11,680 --> 00:35:14,840 Speaker 1: we're able to take careers who used to be drivers. 631 00:35:14,880 --> 00:35:16,640 Speaker 1: A bunch of our courage used to be drivers. They're 632 00:35:16,640 --> 00:35:19,920 Speaker 1: not driving people because of safety concerns. Now the COVID 633 00:35:19,960 --> 00:35:23,120 Speaker 1: safety concerns are largely behind us. We can bring them 634 00:35:23,200 --> 00:35:26,880 Speaker 1: back to drive, or we can hire, or we can 635 00:35:27,040 --> 00:35:30,200 Speaker 1: bring owners onto the platform, both to deliver things and 636 00:35:30,400 --> 00:35:33,960 Speaker 1: to drive people. We just have a very fundamental business 637 00:35:34,000 --> 00:35:37,719 Speaker 1: advantage over any monolone player out there. So you're saying 638 00:35:37,719 --> 00:35:39,640 Speaker 1: when drivers come back, they're going to come back to 639 00:35:39,760 --> 00:35:41,520 Speaker 1: Uber first. And you did say you don't plan to 640 00:35:41,560 --> 00:35:46,120 Speaker 1: significantly increase incentive investments to get those drivers back. Lift 641 00:35:46,520 --> 00:35:49,560 Speaker 1: is planning to increase those investments. And I talked to 642 00:35:49,680 --> 00:35:51,879 Speaker 1: John zim Or, the president of Lift, about why take 643 00:35:51,920 --> 00:35:55,480 Speaker 1: a listen to what he had to say. I'm not concerned. Uh. 644 00:35:55,520 --> 00:35:57,600 Speaker 1: And in fact, the message we're saying is that we 645 00:35:57,840 --> 00:36:00,600 Speaker 1: see the demand coming back and therefore we want to 646 00:36:00,680 --> 00:36:03,640 Speaker 1: invest in supply. So this is part of the reason 647 00:36:03,640 --> 00:36:06,960 Speaker 1: their stock one off a cliff. Are you saying you 648 00:36:07,080 --> 00:36:09,799 Speaker 1: won't have to increase incentives and that this won't lead 649 00:36:10,160 --> 00:36:12,279 Speaker 1: to a subsidy war, because that's what we've seen in 650 00:36:12,360 --> 00:36:18,120 Speaker 1: the past. We have already invested in incentives. Remember Europe 651 00:36:18,160 --> 00:36:21,160 Speaker 1: opened up last year, Latin America has has already opened, 652 00:36:21,200 --> 00:36:24,520 Speaker 1: so we have been through this exercise before last year. 653 00:36:24,840 --> 00:36:27,319 Speaker 1: Lift is a year behind us in some aspects as 654 00:36:27,360 --> 00:36:30,960 Speaker 1: far as the reopening goes. So we're very very confident 655 00:36:31,120 --> 00:36:34,160 Speaker 1: in terms of demand coming back. We're very confident in 656 00:36:34,320 --> 00:36:37,320 Speaker 1: terms of supply. Remember we have a structural advantage and 657 00:36:37,400 --> 00:36:40,320 Speaker 1: that we can bring on couriers which are easier to 658 00:36:40,440 --> 00:36:43,120 Speaker 1: bring on, we can upsell them into driving because the 659 00:36:43,200 --> 00:36:47,920 Speaker 1: earnings opportunities now are very very significant. Uh. And as 660 00:36:47,960 --> 00:36:51,520 Speaker 1: a result of this fundamental structural advantage, we're confident not 661 00:36:51,719 --> 00:36:54,560 Speaker 1: only in top line growth, but also in margins. Remember 662 00:36:54,600 --> 00:36:57,560 Speaker 1: we guided lift, you know, I think there are numbers 663 00:36:57,600 --> 00:37:00,520 Speaker 1: one from seventy five million and even DA to fifty 664 00:37:00,680 --> 00:37:03,600 Speaker 1: and a guide at ten to twenty. During that same period, 665 00:37:03,960 --> 00:37:06,680 Speaker 1: we've gone from eighty six million to a hundred sixty 666 00:37:06,719 --> 00:37:10,120 Speaker 1: eight million to two hundred forty two seventy millions. So 667 00:37:10,480 --> 00:37:13,239 Speaker 1: we've been headed in opposite directions for some period of time, 668 00:37:13,680 --> 00:37:15,520 Speaker 1: and I think based on what we heard from them, 669 00:37:15,880 --> 00:37:19,560 Speaker 1: we're headed up. We're headed into pre cash fuow territory. 670 00:37:20,640 --> 00:37:23,600 Speaker 1: You did report a massive loss five point nine billion 671 00:37:23,680 --> 00:37:27,239 Speaker 1: dollars in part tied to your other investments, Aurora D. 672 00:37:27,360 --> 00:37:31,319 Speaker 1: D Grab Are you reassessing your strategy at all? Here? 673 00:37:32,560 --> 00:37:35,399 Speaker 1: We're not reassessing your strategy. You know, those investments were 674 00:37:35,600 --> 00:37:40,000 Speaker 1: part of mergers and acquisitions, different activities, and I think 675 00:37:40,040 --> 00:37:42,320 Speaker 1: we made the right moves, as you can see based 676 00:37:42,400 --> 00:37:46,200 Speaker 1: on the operating results that were displaying, which are absolutely 677 00:37:46,560 --> 00:37:49,520 Speaker 1: industry leading. We're going to take a careful look at 678 00:37:49,560 --> 00:37:53,319 Speaker 1: those equity UH stakes. We have plenty of liquidity. We're 679 00:37:53,360 --> 00:37:56,640 Speaker 1: moving towards free casual profitability, so we will look to 680 00:37:56,960 --> 00:38:00,080 Speaker 1: monetize those stakes in return capital. When we're two the 681 00:38:00,520 --> 00:38:03,799 Speaker 1: one way the other tour shareholders over a period of time. 682 00:38:04,280 --> 00:38:07,120 Speaker 1: But we're caught in the same down draft that everybody 683 00:38:07,160 --> 00:38:11,120 Speaker 1: else is caught in right now, uber CEO dar Causa 684 00:38:11,160 --> 00:38:13,480 Speaker 1: shot he there. You can catch that full interview at 685 00:38:13,520 --> 00:38:15,920 Speaker 1: Bloomberg dot com. I want to get back to today's 686 00:38:15,960 --> 00:38:21,080 Speaker 1: market meltdown and bring in Robert Kentwell Upholdings portfolio manager. 687 00:38:21,200 --> 00:38:23,400 Speaker 1: Robert just how many companies are gonna get caught in 688 00:38:23,480 --> 00:38:27,080 Speaker 1: this down draft and how long does it last? Family. 689 00:38:27,920 --> 00:38:31,759 Speaker 1: It's been pretty ugly, but we are almost at the 690 00:38:32,000 --> 00:38:34,880 Speaker 1: end of earning season here, and your your team has 691 00:38:34,920 --> 00:38:36,960 Speaker 1: done a great job of reporting a lot of the 692 00:38:37,000 --> 00:38:40,839 Speaker 1: bad numbers out there. Um e Commerce has had its 693 00:38:41,120 --> 00:38:43,640 Speaker 1: first negative quarter year every year and just about as 694 00:38:43,680 --> 00:38:46,520 Speaker 1: far back as most folks can remember, even in the 695 00:38:46,560 --> 00:38:49,680 Speaker 1: first half of commerce was still up over the last year, 696 00:38:50,120 --> 00:38:56,080 Speaker 1: and that has a lot of repercussions to other industries, software, rides, sharing, advertising, Well, 697 00:38:56,120 --> 00:38:59,439 Speaker 1: with these so awful to be frank, we think there's 698 00:38:59,480 --> 00:39:03,279 Speaker 1: something big going on here, and we think investors are 699 00:39:03,400 --> 00:39:08,200 Speaker 1: reevaluating whether or not these are actually technology companies with 700 00:39:08,480 --> 00:39:11,520 Speaker 1: limitless scale and low hot pretty costs. Well, you have 701 00:39:11,840 --> 00:39:14,960 Speaker 1: Netflix is now being valued like a cable station. Other 702 00:39:15,040 --> 00:39:18,840 Speaker 1: investors are looking at Facebook's meta's capital intensity and saying 703 00:39:19,320 --> 00:39:21,360 Speaker 1: is this does their future look more like a T 704 00:39:21,480 --> 00:39:24,560 Speaker 1: and T S than it does Google? And you've seen 705 00:39:24,680 --> 00:39:27,319 Speaker 1: multiples re rate faster than we've seen in a really 706 00:39:27,400 --> 00:39:30,720 Speaker 1: long time across these assets because investors not, in our opinion, 707 00:39:30,719 --> 00:39:33,480 Speaker 1: they've likely moved too far in that direction. But you know, 708 00:39:33,560 --> 00:39:35,040 Speaker 1: we've got to do our jobs and pass through it 709 00:39:35,080 --> 00:39:38,800 Speaker 1: and find the good deals here. Meantime, you've had a 710 00:39:38,840 --> 00:39:42,160 Speaker 1: flood of retail investors coming into this market over the 711 00:39:42,239 --> 00:39:46,280 Speaker 1: last couple of years thanks to companies like robin Hood. 712 00:39:46,480 --> 00:39:51,040 Speaker 1: What happens to them, well, a lot of them might 713 00:39:51,080 --> 00:39:54,560 Speaker 1: not exist. You saw something very similar in the in 714 00:39:54,640 --> 00:39:56,720 Speaker 1: the in the late nineties, Internet boom. If you remember 715 00:39:56,800 --> 00:39:58,920 Speaker 1: the explosion of the trades and the merriage trades, and 716 00:39:59,480 --> 00:40:01,880 Speaker 1: a lot of those businesses ultimately had to merge to 717 00:40:01,960 --> 00:40:06,600 Speaker 1: stay alive. Someone out of business, uh, someone private. And 718 00:40:06,920 --> 00:40:09,320 Speaker 1: you know, this Twitter deal very well could be the 719 00:40:09,760 --> 00:40:13,200 Speaker 1: first big transaction that we're seeing, but far from the last. 720 00:40:13,360 --> 00:40:17,600 Speaker 1: So we expect a lot of consolidation. We expect some shutdowns. Uh. 721 00:40:17,840 --> 00:40:20,279 Speaker 1: We we expect the I p O window to remain 722 00:40:20,320 --> 00:40:22,759 Speaker 1: pretty darn't shut So we don't think over the next 723 00:40:22,840 --> 00:40:26,240 Speaker 1: twelve months, you're you're more likely to see a shrink 724 00:40:26,480 --> 00:40:29,480 Speaker 1: in the total number of companies available for investment, uh, 725 00:40:29,600 --> 00:40:32,000 Speaker 1: than you are to see new companies available for investment. 726 00:40:32,560 --> 00:40:35,320 Speaker 1: Where do you expect to see consolidation? Who do you 727 00:40:35,400 --> 00:40:40,239 Speaker 1: expect to see shut down? Well, the worst the business model, 728 00:40:40,280 --> 00:40:43,160 Speaker 1: the more likely to consolidation. So you could you've had 729 00:40:43,160 --> 00:40:44,719 Speaker 1: a lot of the right sharing books on here in 730 00:40:44,760 --> 00:40:47,840 Speaker 1: the last twenty four hours. That space is just desperate for, 731 00:40:48,239 --> 00:40:51,799 Speaker 1: you know, continued consolidation. Just Eat Takeaway and door Dash 732 00:40:51,880 --> 00:40:55,040 Speaker 1: have been big consolidators. Uber's tried to be now they're 733 00:40:55,239 --> 00:40:57,600 Speaker 1: now they're investing. So we think that space is just 734 00:40:57,680 --> 00:41:00,399 Speaker 1: going to continually have to do deals amongst its until 735 00:41:00,440 --> 00:41:02,120 Speaker 1: they get to a small enough under a number of 736 00:41:02,160 --> 00:41:08,680 Speaker 1: players to be profitable. Um, what should buy lift? Ah? 737 00:41:10,080 --> 00:41:12,640 Speaker 1: Have you ever seen two businesses more in need of 738 00:41:12,719 --> 00:41:16,680 Speaker 1: a merger? But like the right sharing space is really 739 00:41:16,800 --> 00:41:20,160 Speaker 1: challenging because they're they're competing for the same thing ultimately, 740 00:41:20,640 --> 00:41:23,680 Speaker 1: which is they thought these You know, I was in 741 00:41:23,760 --> 00:41:25,640 Speaker 1: San Francisco with you for the last ten years while 742 00:41:25,680 --> 00:41:28,279 Speaker 1: these businesses were quickly being built up, and they were 743 00:41:28,320 --> 00:41:32,120 Speaker 1: parading themselves as these as these complicated, fast growing software platforms, 744 00:41:32,400 --> 00:41:35,040 Speaker 1: and they were treating humans like commodities. And if we've 745 00:41:35,120 --> 00:41:37,960 Speaker 1: learned anything over the past two years here, humans are 746 00:41:37,960 --> 00:41:41,239 Speaker 1: actually a very precious input cost into the function of 747 00:41:41,280 --> 00:41:45,520 Speaker 1: these businesses, and those business models are more dependent on humans. 748 00:41:45,640 --> 00:41:48,080 Speaker 1: And it's just about any business you've seen come out 749 00:41:48,120 --> 00:41:50,320 Speaker 1: of Silicon Value in the last decade. And that is 750 00:41:50,400 --> 00:41:52,680 Speaker 1: a really competitive place to be and it's a really 751 00:41:52,760 --> 00:41:54,960 Speaker 1: hard place for investors to sit around and be patient 752 00:41:55,360 --> 00:41:57,640 Speaker 1: for them to find ways of scaling those business models. 753 00:41:57,960 --> 00:42:00,319 Speaker 1: So how long does this drag out? How long are 754 00:42:00,360 --> 00:42:04,040 Speaker 1: we in the red here? Well? Amazon told us that 755 00:42:04,280 --> 00:42:08,120 Speaker 1: starting on May fifteen, growth rates relative to last year 756 00:42:08,400 --> 00:42:12,120 Speaker 1: would start to look better and better, um, and we 757 00:42:12,320 --> 00:42:14,279 Speaker 1: tend to believe them. If you remember last year, the 758 00:42:14,320 --> 00:42:17,359 Speaker 1: first half was incredibly strong, the fastest growth you've seen 759 00:42:17,400 --> 00:42:20,520 Speaker 1: in the US and last fifty years. The second half 760 00:42:20,920 --> 00:42:24,120 Speaker 1: totally different story, one of the worst holiday seasons that 761 00:42:24,160 --> 00:42:27,440 Speaker 1: the US has experienced in twenty years. So the comps 762 00:42:27,520 --> 00:42:30,320 Speaker 1: relative to last year are going to keep improving. That 763 00:42:30,640 --> 00:42:34,440 Speaker 1: likely investors tend to have existential crisis when growth rates 764 00:42:34,480 --> 00:42:37,319 Speaker 1: are slowing down and management teams are surprised at how 765 00:42:37,360 --> 00:42:40,080 Speaker 1: poorly their businesses are performing. But it's gonna get a 766 00:42:40,120 --> 00:42:42,640 Speaker 1: lot easier as the year goes on. And it's very 767 00:42:42,680 --> 00:42:44,719 Speaker 1: possible that as you see some of these growth rates 768 00:42:44,719 --> 00:42:47,520 Speaker 1: start to stabilize glat into last year's numbers, you might 769 00:42:47,640 --> 00:42:53,040 Speaker 1: see some of these multiples come back to more middling ranges. Well, 770 00:42:53,080 --> 00:42:56,920 Speaker 1: that sounds like somewhat of a silver lining. Upholdings Portfolio 771 00:42:57,000 --> 00:42:59,360 Speaker 1: Manager Robert Knt, Well, thanks for giving it to us 772 00:42:59,360 --> 00:43:00,840 Speaker 1: straight of prey shade it. That does it for this 773 00:43:01,040 --> 00:43:03,560 Speaker 1: edition of Bloomberg Technology. Were going to continue to follow 774 00:43:03,600 --> 00:43:05,320 Speaker 1: the sell off right here on the show and on 775 00:43:05,360 --> 00:43:07,960 Speaker 1: Bloomberg Television over the next twenty four hours. And guess 776 00:43:08,000 --> 00:43:11,560 Speaker 1: who's coming on tomorrow Doortos CEO Tony Shoe will ask 777 00:43:11,640 --> 00:43:15,279 Speaker 1: him if consolidation is in the future. And don't forget 778 00:43:15,280 --> 00:43:18,040 Speaker 1: to check out our podcast anywhere you get your podcasts.