Speaker 1: From Mahard. We're Innovation Money and Power Collie in Silicon
Speaker 1: Vallet NBN. This is Bloomberg Technology with Caroline Hyde and
Speaker 1: Ed Ludloven from.
Speaker 2: New York and San Francisco. This is Bloomberg Technology coming up.
Speaker 3: Apple and Google.
Speaker 2: Losing multi billion dollar court fights with the European.
Speaker 4: Union, plus shares of Oracle touch a fresh record high
Speaker 4: on strong demand for AI products.
Speaker 2: While Apple BET's big on AI, unveiling a new line
Speaker 2: of products centered around Apple Intelligence.
Speaker 3: But first let's check on the markets.
Speaker 2: And while it is Apple that we're going to dive
Speaker 2: in on a matcro perspective and maybe tugs the Nasdaq
Speaker 2: more broadly off of its highs. We're up one and
Speaker 2: a half percent over the last two trading days, but
Speaker 2: most of those games are from yesterday.
Speaker 3: Today.
Speaker 2: We are calling some of that risk on sentiment and
Speaker 2: some of the most focus is on some of the
Speaker 2: individual movers, and you're going to dive into it.
Speaker 4: Yeah, Apple and Alphabet, the parent of Google, two court
Speaker 4: fights lost with the EU, but the stock telling two
Speaker 4: different stories. Apple is lower, Alphabet the parent of Google
Speaker 4: modesty higher. Actually at the kind of low point of
Speaker 4: the session, a fourteen point four billion dollar decision to
Speaker 4: imback taxes essentially for Apple, and it's a fine for Google.
Speaker 4: In the fight with the European Union, Eucompetition Commissioner Margaret Vessela,
Speaker 4: who ends her term in November, says the rulings brought
Speaker 4: her to tears.
Speaker 3: Listen to this, of course.
Speaker 5: On your victories, but you also own your defeats, and
Speaker 5: we have had both and hopefully that shows that we
Speaker 5: are willing to push the envelopes also sometimes to take
Speaker 5: a risk in order to try to make sure that
Speaker 5: the market serves the consumer, that we are not just
Speaker 5: small porns. We'll meet for the machine.
Speaker 4: I think Vesay has long maintained this idea that an
Speaker 4: individual member state should not make an ad hoc beneficial
Speaker 4: tax arrangement with a specific company like Apple. Let's bring
Speaker 4: in Bloombergs Jennifer Duggan out of Dublin for more. And
Speaker 4: this relates to a historic series of events in Ireland.
Speaker 4: Back taxes essentially just explain the basics of the EU
Speaker 4: ruling in Apple's case.
Speaker 6: Hi.
Speaker 7: Yeah, The case relates to tax Apple's tax that was
Speaker 7: paid in Ireland back in the nineteen nineties and early
Speaker 7: two thousands under the ruling today, the European Court ruled
Speaker 7: that Apple hadn't paid enough tax and that Ireland had
Speaker 7: granted Apples state aid in relation to its presence in Ireland,
Speaker 7: so that tax will no need to be paid in Ireland.
Speaker 2: Just to remind us more broadly of Ireland's view on
Speaker 2: taxes of old and why it is embroiled in this
Speaker 2: way with.
Speaker 7: Apple, Well back in the early nineteen nineties, Ireland had
Speaker 7: wanted to make itself an attractive place for foreign direct
Speaker 7: investment and it had a lower corporation tax rate as
Speaker 7: part of those efforts. Since then, there was a lot
Speaker 7: of accusations at the time of Ireland that Ireland had
Speaker 7: become a tax haven. There are some tax tax loops,
Speaker 7: essentially one in particularly that was known as the Double Irish.
Speaker 7: Those have in the past ten fifteen years those have
Speaker 7: essentially been closed off and Ireland is now subject to
Speaker 7: has signed up to OECD rules on global taxation and
Speaker 7: it now has a fifteen percent corporation tax rate, So
Speaker 7: those situations have changed. But at the time back in
Speaker 7: this refers to a very specific period back in the
Speaker 7: nineteen nineties and two thousands.
Speaker 2: Apple has some cash spare luckily, but is a huge
Speaker 2: amount to be paying him taxis Jennifer Duggan live from Alan,
Speaker 2: We thank you very much. Apple, in fact, though, introduced
Speaker 2: the latest version of its flagship product just yesterday, the
Speaker 2: iPhone sixteen.
Speaker 3: CEO Tim Cooks, saying it was built for AI.
Speaker 2: Quote from the ground up, Mal German has had ooh,
Speaker 2: a little under twenty four hours to digest. You knew
Speaker 2: most of it coming ahead of the game mark. Is
Speaker 2: it going to be AI that makes everyone buy a
Speaker 2: new aliphone?
Speaker 8: Well, it's interesting because Apple Intelligence isn't, as we've discussed
Speaker 8: many times, isn't going to be released until mid October
Speaker 8: at the earliest, and these phones begin chipping on September twentieth.
Speaker 8: But AI is where the marketing message is at right now.
Speaker 1: AI is what Wall.
Speaker 8: Street is interested in right now. AI has been on
Speaker 8: the mines of consumers in the past several months, so
Speaker 8: that is where Apple is focusing its messaging for these
Speaker 8: new devices. In my view, what's really going to spur
Speaker 8: upgrades are people who are on older phones, whether that's
Speaker 8: the fourteen to thirteen, twelve, eleven or earlier, people who
Speaker 8: have a completely drained battery, people who have a craft screen,
Speaker 8: people who want those nice camera upgrades. It's not really
Speaker 8: going to be the AI that's pushing these sales. It's
Speaker 8: going to be the other factors. I think.
Speaker 4: Mark you add access to iOS eighteen point one beta
Speaker 4: version right, and yesterday I was able to get hands
Speaker 4: on with sixteen sixteen plus pro and pro macs, and
Speaker 4: the early functionality is like quite limited tech summarization, auto
Speaker 4: response in email. There is some pretty cool image editing stuff,
Speaker 4: you know in the version that I was able to access.
Speaker 4: But you seem to have detail as well about what
Speaker 4: happens next, a series of updates and more functionality that's
Speaker 4: perhaps the cutting edge.
Speaker 1: Yeah, that's right.
Speaker 8: So in eighteen point one, that's going to be the
Speaker 8: first version that includes Apple Intelligence, like you said, that's
Speaker 8: going to include summarization, that's going to call phone, include
Speaker 8: phone call recording and provide you a transcription afterwards. It's
Speaker 8: going to include voice memo transcriptions. It's going to include
Speaker 8: notification summarization, notification prioritization within the mail app. And then
Speaker 8: you have eighteen point two coming in December. That's when
Speaker 8: include things like chat GPT integration from open AI. It's
Speaker 8: going to include gen Moji, where you can use text
Speaker 8: to create your own emojis. It's going to include an
Speaker 8: image playground app for generative image creation. There's an updated
Speaker 8: interface for auto email categorization within the mail app. There's
Speaker 8: general notification prioritization across the system on your lock screen,
Speaker 8: so more bells and whistles there. But the real thing
Speaker 8: that people think about when you think about AI is Siri,
Speaker 8: And right now, Siri has an updated interface on these
Speaker 8: newer phones when you're running Apple Intelligence. But truth be told,
Speaker 8: that's just lipstick, right, because the reality is that the
Speaker 8: underpinnings of Siri really haven't change, and Siri is not
Speaker 8: going to change in any meaningful way until it gets
Speaker 8: its own sort of brain transplant, so to speak, in
Speaker 8: March April of next year. That's when Siria is going
Speaker 8: to be able to do things like pull up when
Speaker 8: my mom's flight lands, or what is the podcast that
Speaker 8: my wife sent me two weeks ago? Right, that's the
Speaker 8: deeper integration and in that actions that people have been
Speaker 8: waiting for. That's probably four to six months away.
Speaker 4: Still doing Berg's Mark German an honor to be live
Speaker 4: blogging with you in the trenches of you going through
Speaker 4: pretty much every piece of product announcement that you had
Speaker 4: nailed in advance. Anyway, really strong reporting, Thank you very much.
Speaker 4: I just point out one thing as well that we
Speaker 4: posted in the blog that you take for granted, but
Speaker 4: best ever battery life, most powerful processor. These are things
Speaker 4: that people are interested in, and there's a lot more
Speaker 4: than the iPhone. Let's keep it going with Marabell Lopez,
Speaker 4: principal analysts at Lopez Research, and you know, in aggregate,
Speaker 4: what was there to be excited about across the product
Speaker 4: portfolio for you, Marabell.
Speaker 9: I think in many ways we saw exactly the predictable
Speaker 9: hardware innovations that you could always see with a smartphone. Lunch,
Speaker 9: we talked about a better camera, We talked about bezzlso
Speaker 9: a bigger screen with the watch, we talked about thinner, lighter.
Speaker 9: I think for consumers that are coming into these new
Speaker 9: phones that need to do upgrades the concept of having
Speaker 9: the camera button and the visual intelligence was really interesting. Really,
Speaker 9: what sells phones with consumers continues to be the visual aspects.
Speaker 9: How's the camera? What can we do with photos? What
Speaker 9: can we do with videos? And we saw a strong
Speaker 9: showing on that. I think some of the surprises were
Speaker 9: around things like the health features that they added with
Speaker 9: sleep APMEA and hearing aids, So it was actually, in
Speaker 9: some ways predictable, with a few surprises that really focus
Speaker 9: on usability.
Speaker 2: I think that health focus is an interesting one, Marabell.
Speaker 2: But give us your take on artificial intelligence and Apple intelligence.
Speaker 2: Is that going to be a winning formula if it's
Speaker 2: not actually here to use right yet?
Speaker 9: Well, first of all, I think the concept that it's
Speaker 9: not here until December or Q one next year being
Speaker 9: a big deal is really overplayed. In general, most consumers
Speaker 9: are not going out and saying, what I really want
Speaker 9: right now is artificial intelligence? Right What they want is
Speaker 9: they want things to be easier to use. They want
Speaker 9: to be able to capture better visuals, do better sharing,
Speaker 9: express themselves in different ways. And I think that Apple
Speaker 9: took a very tempered approach to what artificial intelligence means
Speaker 9: and really tried to tie it to those things that
Speaker 9: they thought consumers would find important. So not just artificial
Speaker 9: intelligence for artificial intelligence sake, but something that's going to
Speaker 9: make your life better. They talked about personalization and context
Speaker 9: and how to create videos easier, and how to do emojis,
Speaker 9: So I think these are things that resonate with consumers
Speaker 9: and the timing of that it'll come to them. They'll
Speaker 9: use it, but you know, they're not knocking the doors
Speaker 9: down for it right now. What they want is they
Speaker 9: want a phone or watch that's going to be able
Speaker 9: to run whatever comes next from Apple.
Speaker 2: Ambient Ai is how a guest put it yesterday, just
Speaker 2: naturally doing it all in the background, Marabel, go back
Speaker 2: to the watches and the AirPods.
Speaker 3: It did have quite an impact on certain stocks.
Speaker 2: Certainly hearing aid makes at one point in the trade.
Speaker 2: How much are people going to be spurred to buy
Speaker 2: this on a health focus?
Speaker 9: So I don't know if they're necessarily going to buy
Speaker 9: it on the health focus.
Speaker 1: What I think is.
Speaker 9: Really going to happen and what the real win is
Speaker 9: for Apple is the concept of the continuous upgrade cycle.
Speaker 9: Once I get that AirPod in, I figured out that
Speaker 9: I have a hearing issue or that I can have
Speaker 9: better quality hearing with this, I think that's a game
Speaker 9: changer in terms of continual use and constant upgrades. I
Speaker 9: do think it's an issue for the hearing aid manufacturers.
Speaker 9: I mean, one of the things that We've always had
Speaker 9: an issue with is do people want to feel like
Speaker 9: they're wearing health devices. These are just AirPods, right, Nobody
Speaker 9: knows if it's a hearing aid or not. So I
Speaker 9: think there's a lot of opportunity for that. I also
Speaker 9: just find the usability. Think about not needing the change
Speaker 9: of battery as an elderly person, you just have easy
Speaker 9: charging capability. I think it could be a huge win
Speaker 9: for people that need to have better hearing.
Speaker 4: Marrabo, it was interesting that inside the Steve Jobs Theater,
Speaker 4: the most audible sort of gasps and excitement was around
Speaker 4: watch and airports in parts specifically sleep ATNA and hearing aid.
Speaker 4: We talk about wearables as kind of the jumping in
Speaker 4: point because actually the hardware costs less than the smartphone
Speaker 4: and lowers the barrier to entry. How do you model
Speaker 4: that for the success of Apple's ecosystem?
Speaker 9: So when I think about Apple, it is a portfolio approach, right,
Speaker 9: you have a phone, you have a smart device. But
Speaker 9: I think the real win for Apple, what they're very
Speaker 9: good at, is that all these things work together, and
Speaker 9: the more of you you have, the better your life becomes.
Speaker 9: And I think they really try to ugur in on
Speaker 9: we can help you with your health, we can help
Speaker 9: you with fitness, we can help you with problems that
Speaker 9: you didn't even know you had, and all of that's
Speaker 9: attached to the personalization of you and kind of taking
Speaker 9: what we talked about as that AI and really trying
Speaker 9: to make that AI relevant in someone's life. So I
Speaker 9: think moving forward, we're going to continue to see that
Speaker 9: the health market is going to be one of the
Speaker 9: drivers for Apple revenue moving forward.
Speaker 2: A lot of this was about what's inside of the
Speaker 2: Apple I phone, because it hasn't changed that much extensibly.
Speaker 3: From the outside.
Speaker 2: What has changed on the outside is what's going on
Speaker 2: in China Huawei. We see a trifold phone. How much
Speaker 2: do we see innovation from a hardware perspective coming from China.
Speaker 9: We actually see quite a bit of innovation coming from China.
Speaker 9: What I think is very interesting is that Apple continues
Speaker 9: to have the perspective that the foldable phone is not
Speaker 9: something that they need to participate in. Clearly, a trifle
Speaker 9: phone is an innovation. The timing of the Huawei launch
Speaker 9: was really important to try to create some of that
Speaker 9: fear and uncertainty in Apple's presence in China, and I
Speaker 9: actually think it accomplished that. But the reality of the
Speaker 9: situation is foldable devices are very expensive. It's been a
Speaker 9: limited market for some time. Samsung has been pushing that
Speaker 9: rock up the hill for quite a while, and it
Speaker 9: has also not made that break. So it makes perfect
Speaker 9: sense to me. If you're looking at a mainstream market,
Speaker 9: then foldability isn't going to be where it's at. But
Speaker 9: if you want to talk tech factor cool, fold ability
Speaker 9: is absolutely that.
Speaker 2: Parabell Lopez, principal analyst at Lopez Research, wonderful take Thank you.
Speaker 2: Coming up, we're going to be joined by Rubric CEO
Speaker 2: if we'll seener for a conversation on the firm's earnings
Speaker 2: doubts around growth in the second half.
Speaker 3: Is that what's pulling the shares lower.
Speaker 2: This is putting big technology.
Speaker 5: Too.
Speaker 4: Notable calls from the cell side this morning, first out
Speaker 4: DA Davidson initiating coverage and Alphabet with a neutral recommendation,
Speaker 4: the analysts highlighting numerous headwinds within the company's core search business.
Speaker 4: And our second goal comes from Deutship Bank naming Tesla
Speaker 4: it's top pick within the auto sector, noting that shares
Speaker 4: deserve a unique valuation, giving its potential to reshape business
Speaker 4: models across multiple industries.
Speaker 2: Caart, do have another stock that we should be looking at,
Speaker 2: Rubric posting a thirty five percent gain in revenue.
Speaker 3: Raising for your guidance.
Speaker 2: Yeah, shares are off six percent, joining us now to
Speaker 2: dive in as Rubric CEO before seen. Now who you
Speaker 2: know must be looking at the stock with some surprise.
Speaker 2: You've got analysts such as Guggenheim saying you significantly outperformed
Speaker 2: on all key metrics, but Bloomberg Intelligence they're flagging. Perhaps
Speaker 2: some questions around growth dynamics in the second half.
Speaker 3: Can you speak to that.
Speaker 6: Thank you, Caroline for this opportunity. Look, I leave this
Speaker 6: stock to the expert. But we are building a long
Speaker 6: term business and if you look at the growth and
Speaker 6: a very important market that is cyber resilience. We grew
Speaker 6: forty percent year over year on our subscription era to
Speaker 6: over nine hundred million. I mean we are growing at
Speaker 6: this speed at that scale. And last quarter we beat
Speaker 6: the quarter handsomely. Q two, then quarter before we beat
Speaker 6: the quarter handsomely. We are continuing to outperform both on
Speaker 6: top line and our profitability metrics, and this quarter we
Speaker 6: also raise the guidance for the rest of the year.
Speaker 6: So we are very bullish about what is in front
Speaker 6: of us. We are confident in our execution, what we
Speaker 6: see and we want. We'll finish our years strong.
Speaker 4: Before in the context is like what Rubric actually does.
Speaker 4: It seems like when enterprises invest more in cloud or
Speaker 4: shift to the cloud, there's a benefit that you derive
Speaker 4: from that. Could you explain the basics of that relationship
Speaker 4: and those mechanics.
Speaker 6: As more in board businesses and governments have realized that
Speaker 6: just doing cyber prevention will not allow them to run
Speaker 6: their business when there is a successful cyber attack. Because
Speaker 6: cyber attacks are inevitable. They are all thinking about cyber resilience.
Speaker 6: How do they continue to run their business win in
Speaker 6: presents of attacks? How do hospitals continue to admit patients?
Speaker 6: Banks continue to dole out money? And that's what we do.
Speaker 6: We help businesses ensure that their applications are running and
Speaker 6: applications could be in their enterprise, could be in the
Speaker 6: SaaS could be in the cloud. And as businesses are
Speaker 6: doing more digital transformation to gain productivity, cyber is the
Speaker 6: number one rest and ability to run their services all
Speaker 6: the time. Irrespective of successful cyber attack is what we
Speaker 6: help their businesses with. So more cloud transformation, more SaaS adoption,
Speaker 6: more digital transformation is actually helping our business.
Speaker 4: People switching gear, Sally, I think we asked you, let's
Speaker 4: say a dozen times over the course of a year
Speaker 4: when you were going to go public, and eventually it happens,
Speaker 4: and it feel like it all happened quite fast. So
Speaker 4: I just wanted to ask what it's like being a
Speaker 4: public company and how that you think that's going.
Speaker 6: It's going great as a public company. But for me
Speaker 6: as a CEO, there is no real different friends other
Speaker 6: than reporting to public market and doing callbacks with our stakeholders,
Speaker 6: because from the day one of the company, we wanted
Speaker 6: to build a long term company, a company that lasts
Speaker 6: longer than my own professional career in life. And there's
Speaker 6: no difference in terms of how we build our product,
Speaker 6: how we think about the next chapter of Rubric. We
Speaker 6: are coming up on a billion dollar that we actually
Speaker 6: guided to thinking about how do we go to three
Speaker 6: billion and beyond what are the product configurations that we
Speaker 6: do today so that we have high acceleration four years
Speaker 6: down the line. That's how we think as a business,
Speaker 6: and there's no real change in how we operate our business.
Speaker 3: Since you've gone public.
Speaker 2: Though we had the most major global IT outage and
Speaker 2: everyone started thinking about resiliency all over again now today,
Speaker 2: in fact, I think Microsoft is currently hosting a cybersecurity
Speaker 2: summit for the first time since that outage with government
Speaker 2: participation to really get their learnings. People, how many customers
Speaker 2: did you suddenly sign from that event? How have you
Speaker 2: seen the market shift after it?
Speaker 6: It was an unfortunate event, but it actually previewed what
Speaker 6: a real cyber attack could do to our digital, interconnected
Speaker 6: global economy, and it really, as you mentioned, brought the
Speaker 6: discussion of resilience at the top. And so we are
Speaker 6: seeing a lot of CIOs and board of directors and
Speaker 6: csows and CEOs having this conversation that how do we
Speaker 6: keep our businesses up and running irrespective of what happens.
Speaker 6: So we are definitely seeing anecdotal evidence of like a
Speaker 6: renewed interest, renewed focus, and cyber resilience is the number
Speaker 6: one topic in cybersecurity, but this is one of the
Speaker 6: many factors and over time it will be clear how
Speaker 6: much impacts it does to actual demand and top line people.
Speaker 4: Very simply did you get invited to this summit that
Speaker 4: Microsoft's hosting and what are you hearing about it?
Speaker 6: We have a great partnership with Microsoft. In fact, they
Speaker 6: gave us a Healthcare Partner of the Year because we
Speaker 6: are really going after protect the unprotected, which is the
Speaker 6: healthcare segment of the market. And obviously Microsoft is very
Speaker 6: serious about cybersecurity. If you look at the number of
Speaker 6: initiatives that they are doing, number of partnerships that we
Speaker 6: are creating with microsoftware. We are bringing the cyber resilience,
Speaker 6: They are bringing the cloud and infrastructure security, and together
Speaker 6: we are delivering end to end security. So as far
Speaker 6: as Microsoft is concerned, our partnership around security is very
Speaker 6: strong and they are quite serious about it.
Speaker 2: What about global growth more broadly before and where are
Speaker 2: you seeing CEOs CSOs willing to spend at this moment?
Speaker 6: So I was in Asia three four weeks ago and
Speaker 6: spent almost a week in Japan. And if you look
Speaker 6: at a country like Japan, which is a large industrial economy,
Speaker 6: they are also undertaking digital transformation because they want to
Speaker 6: gain productivity. They want to have this whole digital moment
Speaker 6: for themselves. And the number one concern for Their digital
Speaker 6: transform is cybersecurity because in a manufacturing oriented economy, if
Speaker 6: you have digital disruption because of cyber attacks, I mean
Speaker 6: the whole economy could come to stand still, or the
Speaker 6: whole company could come to stand still. So folks are
Speaker 6: very serious about investing in cybersecurity, particularly around cyber resilience,
Speaker 6: because they have done a lot of investment in prevention
Speaker 6: of attack, but they're not able to prevent the unpreventable.
Speaker 6: So the focus is how do I keep my services
Speaker 6: up and running, how do I ensure that I confidently
Speaker 6: do digital transformation and.
Speaker 4: More BRICO people saying yea, it's great to have you
Speaker 4: back here on Booming Back Technology. Thank you very much.
Speaker 4: It's time for talking tech. And first off, Amazon's Audible
Speaker 4: is set to begin selecting US based narrators to help
Speaker 4: train AI their own voices. The company plans to use
Speaker 4: cloned voices to quickly and cheaply increase their audiobook offerings.
Speaker 4: Amazon currently offers the option for self published authors to
Speaker 4: use a generic virtual voice narration for their works. Plus
Speaker 4: shares of Avali Barber rising in Hong Kong trading. This
Speaker 4: is the e commerce giant made its stock debut to
Speaker 4: investors from mainland China. For the first time, shares of
Speaker 4: Vali Barber were added to the stock connect program that
Speaker 4: linked Shanghai and Shenzen with the Hong Kong Exchange. The
Speaker 4: stock rose four point two percent, the most since August sixteen,
Speaker 4: and a sigh of relief for AI investors. TSMC revenue
Speaker 4: rows thirty three percent in August for sales reaching seven
Speaker 4: point eight billion dollars, Taiwan's largest company, now making more
Speaker 4: than half of its revenue from high performance computing driven
Speaker 4: by AI demand for the third quarter, and this expect
Speaker 4: TSMC's revenue to grow thirty seven percent.
Speaker 1: Correct.
Speaker 2: Let's just check in some stocks again and ed you
Speaker 2: referenced this earlier Tesla having a very good day one
Speaker 2: of the biggest points to the higher side for the Nasdaq,
Speaker 2: Deutsche Bank naming the ev maker it's top pic with
Speaker 2: auto sector. Also and interestingly, the EU maybe actually reducing
Speaker 2: those tariffs on Tesla's and other evs from China.
Speaker 3: Interesting as we get that news on Google and Apple
Speaker 3: from the EU today.
Speaker 4: And i'd also point out it's thirty days until Robotaxi
Speaker 4: Day and elon Musk if you're watching, I'm still waiting
Speaker 4: on my invite, La.
Speaker 3: You come, We're coming up. It's the first ever private
Speaker 3: spacewalk mission for SpaceX. I'll have all the details on
Speaker 3: today's launch.
Speaker 2: That's next. This is Blue Big Technology. Welcome back to
Speaker 2: Bloomberg Technology.
Speaker 4: I'm Caroline Hyde, New York and our medlad Low in
Speaker 4: San Francisco.
Speaker 2: Quick check on these markets for yeah, because we're trying
Speaker 2: to remain risk on. It will feel on the day.
Speaker 2: We're up five tens of a percent. Let's call it
Speaker 2: on then as that one hundred after remember a decent
Speaker 2: woman in one percentage point game yesterday, So riding high
Speaker 2: even though we got the anxiety of an inflation print
Speaker 2: and of course a presidential debate that comes later tonight.
Speaker 3: The tenure yield, they're getting a bid.
Speaker 2: Maybe there is some anxiety and we're wanting to get
Speaker 2: into some of these well more haven trades, that is
Speaker 2: the bond market. Despite we've got some auctions coming up.
Speaker 2: We're down some three four basis points. Let's call it
Speaker 2: on the tenure. Looking at Bitcoin, just catching a slight
Speaker 2: bid up two tens percent. It's been a bit volatile
Speaker 2: on the day. Move on and have a look at
Speaker 2: the individual movers because it's a day of micro news today.
Speaker 2: Apple drag lower off of it's lows, but still trading
Speaker 2: three tens percent to the downside.
Speaker 3: After well, we're still.
Speaker 2: Wondering what appen intelligence really comes and what it means
Speaker 2: for sales with the new iPhone sixteen. But it loses
Speaker 2: that fight it had with the EU over at more
Speaker 2: than few fourteen billion dollar tax debt that they owe.
Speaker 2: Of course they have preferential treatment coming from Ireland. EU
Speaker 2: says we still want that money. Look Bloomberg Intelligence other
Speaker 2: Ana is saying, this isn't going to affect the business
Speaker 2: from a fundamental business, one of the few ones that
Speaker 2: could afford it. But Google also loses its fight and
Speaker 2: more than two billion one in terms of exerting its power,
Speaker 2: it would seem when it comes to e commerce and
Speaker 2: its own search platform. And look once again May it's owing.
Speaker 2: They're both disappointed. We understand. Let's have a look at
Speaker 2: Oracle though record high for the stock up more than well,
Speaker 2: let's call it twelve percent. Now AI a driving force
Speaker 2: in terms of cloud what are you watching it?
Speaker 4: Well? Earlier today SpaceX launched a rocket carrying four private
Speaker 4: astronauts to space.
Speaker 2: Got you one alf.
Speaker 10: Do you fought us?
Speaker 1: You can be on range.
Speaker 4: Flying crew on board Dragon and Falcon nine of New Heights,
Speaker 4: all part of a groundbreaking mission aimed at performing the
Speaker 4: world's first commercial spacewalk. After a number of days of delay, Carrow,
Speaker 4: the Polarist Dawn mission is underway.
Speaker 2: Jared isaacman billionaire, happens to run a company also now
Speaker 2: in space. It would seem just remind us why the
Speaker 2: spacewalk is so ground king.
Speaker 4: Yeah, I think that it just hasn't been done before.
Speaker 4: And the point of Jared's ambition to go back to space,
Speaker 4: because remember he was part of the Inspiration four crew,
Speaker 4: is he is this adrenaline junkie billionaire. He is bankrolling
Speaker 4: this threat thing in partnership with SpaceX. He's fascinated by
Speaker 4: pushing the boundary of technology but also sort of human
Speaker 4: kinds achievements in space. I'd also point out like he's
Speaker 4: not alone up there. He's with Sarah Gillison and Ana Mennon,
Speaker 4: two very senior SpaceX engineers who go as mission spen
Speaker 4: specialist and medical officer respectively. On the right. Scott Petite,
Speaker 4: mission pilot, is Jared's best friend, essentially another adrenaline junkie
Speaker 4: and fighter jet pilot.
Speaker 2: And Sarah and Jered they're the ones that are going
Speaker 2: to open the hatch, walk on out and make history.
Speaker 4: Ultimately, what's different about this space walk is not just
Speaker 4: the sort of altitude that they'll do it at, but
Speaker 4: also the mechanism kind of used to historic pictures of
Speaker 4: spacewalks on the outside of the ISS where they have
Speaker 4: a air lock and they're tethered up. This time they'll
Speaker 4: be tethered up, but the only way to do it
Speaker 4: inside the Dragon capsule is to open up the hatch.
Speaker 4: So it means that the two of them will go
Speaker 4: out one by one, but there'll be a vacuum inside
Speaker 4: the capsule itself, meaning that the other two who are
Speaker 4: not doing the spacewalk also have to sort of don
Speaker 4: these specialist suits and just sit in there, floating in
Speaker 4: a vacuum. And then when the two return, hopefully they
Speaker 4: close the hatch, repressurize and add oxygen to the chamber,
Speaker 4: and all being well and equal, they'll come home.
Speaker 3: Let's hope.
Speaker 2: Now we want to turn from one race, the space race,
Speaker 2: to another one to the White House. Presidential nominee Kamala Harris.
Speaker 2: Of course, VP and Donald Trump are set to debate stage.
Speaker 2: Set to debate on the stage later tonight at nine
Speaker 2: pm Eastern. For more, let's bringing Katie Lines, who joins.
Speaker 3: US and Kayleie Technology Show. Is it corporate tax for us?
Speaker 1: Is it? Well?
Speaker 3: The focus on innovation? Anything you think we might get, well,
Speaker 3: you could get some on innovation.
Speaker 11: Investing in US innovation is actually something both of these
Speaker 11: campaigns have talked about. There is a whole segment in
Speaker 11: that regard on Kamala Harris's policy Paige the issues page
Speaker 11: on her website, so you could get some of that.
Speaker 11: Donald Trump may even bring crypto into the conversation, as
Speaker 11: he has been talking about that more and more given
Speaker 11: the money the crypto industry is throwing into this election cycle.
Speaker 11: He wants to make America the crypto capital of the world,
Speaker 11: he says, But for business as a whole, beyond just technology,
Speaker 11: they of course will be affected by things like taxes too.
Speaker 11: Kamala Harris obviously wants to raise the corporate tax rate
Speaker 11: to twenty eight percent. She also wants to lift to
Speaker 11: twenty eight percent the tax on long term capital gains
Speaker 11: for those making over a million dollars. She of course
Speaker 11: hasn't specifically said anything about unrealized capital gains, although Donald
Speaker 11: Trump has accused her of that, it is true. Her
Speaker 11: campaign initially said it supported a number of policy ideas
Speaker 11: in the President Biden's last budget proposal, which included a
Speaker 11: tax on unrealized capital gains for those making over one
Speaker 11: hundred million dollars a year who had less than twenty
Speaker 11: five percent tax rate on their income.
Speaker 3: But she has an outright.
Speaker 11: Said that that is not on her policy platform, and
Speaker 11: of course she wants to raise taxes on regular capital
Speaker 11: gains for those making over a million dollars and help
Speaker 11: to fund some of her other initiatives, including down payment
Speaker 11: assistants for first time home buyers and no tax on tips,
Speaker 11: that kind of thing. Donald Trump, of course, wants to
Speaker 11: cut the corporate tax rate for companies that make things
Speaker 11: in America down to fifteen percent, and also wants to
Speaker 11: make permanent his twenty seventeen tax cuts. All of those
Speaker 11: proposals are estimated to cost about ten and a half
Speaker 11: trillion dollars over the next ten years, and there just
Speaker 11: simply isn't enough non defense discretionary spending projected over the
Speaker 11: next ten years to pay.
Speaker 4: For that, and he also wants to cut government spending
Speaker 4: or make it more efficient with the help of one
Speaker 4: Elon musk Helly.
Speaker 1: In my more.
Speaker 4: Limited experience of presidential debates, having only lived in this
Speaker 4: country since twenty eighteen, the news cycle also kind of
Speaker 4: informs what they'll discuss. Sometimes you have the idea of
Speaker 4: a sovereign wealth fund in the headlines, and you've kind
Speaker 4: of outlined cryptso just is there a stage of what
Speaker 4: we'll be asked and the key battleground.
Speaker 11: Well, no questions have actually been told of the candidates
Speaker 11: or to us ABC, and those moderators are keeping them
Speaker 11: close to the chest. That is part of the rules
Speaker 11: for this debate, including of course the rule that the
Speaker 11: microphone will be off for the candidate whose turn it
Speaker 11: is not to speak, which will be an interesting dynamic there.
Speaker 11: But yeah, you're right, news does indeed drive questioning often
Speaker 11: on the sovereign wealth fund. We're getting that, frankly from
Speaker 11: both the Democrat and Republican sides of the aisle. First,
Speaker 11: Donald Trump floated a US sovereign wealth fund at the
Speaker 11: Economic Club of New York last week. Then Bloomberg reported
Speaker 11: just a day later that this is actually something that
Speaker 11: Biden needs, including Jake Sullivan have also been pursuing. That
Speaker 11: is a question of how exactly that would be funded.
Speaker 11: We don't know those details yet. Donald Trump has suggested
Speaker 11: it could be funded and perhaps by tariffs, and tariffs
Speaker 11: of course is another thing we expect could come up
Speaker 11: on the stage tonight, as Donald Trump has floated a
Speaker 11: blanket tariff on all US imports potentially of ten percent,
Speaker 11: and even higher tariffs on China. And China of course
Speaker 11: gets us to the foreign policy aspects that could be
Speaker 11: present in this debate as well, not just on China,
Speaker 11: but the ongoing war between Russia and Ukraine. Of course,
Speaker 11: perhaps most difficulty for Kamala Harris in particular as the
Speaker 11: vice president of this Biden administration, could be questions around
Speaker 11: Israel and the ongoing war in Gaza, and of course
Speaker 11: here domestically, it's the economy always.
Speaker 4: Bloomba's Kaylee Lynes, thank.
Speaker 1: You very much.
Speaker 3: Time now for our VC roundup.
Speaker 2: First up, Singapore based firm Genesis Alternative Ventures, a private
Speaker 2: lender to venture and growth stage companies, has closed its
Speaker 2: second debt fund and the lower end of its target.
Speaker 2: That's as global investors remain somewhat cautious about Southeast Asia's
Speaker 2: startup industry, and the firm is raised one hundred and
Speaker 2: twenty five million for the fund, securing new investors including
Speaker 2: Japan's Mazoo Home Bank and Israel's our Crowd plus Amco.
Speaker 2: It's a London based bench firm that has backed fintech diling,
Speaker 2: Stripe and Karana. It's raised one point two four billion
Speaker 2: dollars for two new funds. The dual fund strategy includes
Speaker 2: its first dedicated arm for growth capital and acts as
Speaker 2: a response to a dearth of late stage technology financing
Speaker 2: in Europe. According to the firm, CEO and Exo Watt
Speaker 2: is a startup backed by open Ay. Sam Altman, just
Speaker 2: launched a modular system to generate, store, and dispatch clean
Speaker 2: energy to data centers. So the startup is relatively new,
Speaker 2: it already has a demand backlog of some one point
Speaker 2: two gigawatts from some of the world's largest data center
Speaker 2: operators and wind and solar developers.
Speaker 4: Ed another story, Lara Belle, an open source startup in Arkansas,
Speaker 4: just raised fifty seven million dollars from Excel and Excel
Speaker 4: partner Mars Clements, who led this investment joins us here
Speaker 4: in San Francisco. Curiously enough, I've got a bit of
Speaker 4: experience covering tech in Arkansas. I've spoken a lot with
Speaker 4: like Stuart Walton and the up partnership who kind of
Speaker 4: like wanted to be a tech club. I was surprised
Speaker 4: to see the headline tell me about the round and
Speaker 4: a bit about the company and also the state.
Speaker 12: Yeah, sure thing, So the accent was not a dead
Speaker 12: giveaway for Little Rock, Arkansas. But I'm glad to know
Speaker 12: that you spend time in that tech ecosystem too. Larravel
Speaker 12: is an exceptional company founded by a really generational founder,
Speaker 12: Tailor Otwell. And the fact that it's in Little Rock,
Speaker 12: the fact that it is bootstrapped and profitable and really
Speaker 12: a company that controls its own destiny, is entirely consistent
Speaker 12: with what our growth investing strategy is at Excel and
Speaker 12: has been for sixteen years.
Speaker 4: Right, Miles, I'll bite you strap some profitable definition explanation.
Speaker 12: Yeah, sure thing. So we have this kind of peculiar
Speaker 12: growth investing strategy with fits which fits in with Excel
Speaker 12: strategy that we have devoid for forty years across all
Speaker 12: of our firm, which is that at the most fundamental level,
Speaker 12: we want to be the first partner the founder's turn
Speaker 12: to when they go to raise capital. Now, doing that
Speaker 12: requires a certain degree of flexibility. Some companies want to
Speaker 12: raise a million dollars in the heart of San Francisco
Speaker 12: in a seed round. Other companies want to raise a
Speaker 12: fifty seven million dollars bootstrap Series A, as was the case
Speaker 12: Wither in Little Rock, or I would point to a
Speaker 12: company like one Password, which raised a two hundred million
Speaker 12: dollars Series A in Toronto, which my partner a rou
Speaker 12: Matthew led a couple of years ago.
Speaker 2: One Password might see competition coming from well a pretty
Speaker 2: age old firm, favorite Silicon valley that is Apple. How
Speaker 2: are you seeing competition coming from the huge publicly traded
Speaker 2: companies and can there still be room for these startups?
Speaker 1: Absolutely?
Speaker 12: I mean the technology industry today is so humbling. There
Speaker 12: are so many great incumbents, there's so many great startups.
Speaker 12: You're seeing companies move at warp speed with the assistance
Speaker 12: of AI. But with that said, the companies that we
Speaker 12: really have built our growth practice around are just growing durably, sustainably,
Speaker 12: profitably at kind of a different cadence and It's a
Speaker 12: cadence of growth and a discipline that we really really
Speaker 12: appreciate and that we seek out when we spend time
Speaker 12: in geographies like Toronto with one Password, Sydney Australia with Alassian,
Speaker 12: probo Utah with qual Tricks, etc.
Speaker 3: We're humbled.
Speaker 12: We're always sort of paranoid and aware of the competition
Speaker 12: out there, but we think these companies are special in
Speaker 12: their ability to be durable and compound for decades at
Speaker 12: a time.
Speaker 2: It's interesting about open source, and we had Chi Discovery
Speaker 2: on yesterday just raised around that sort of open source
Speaker 2: large language model, particularly around biotech. Now, when you're thinking
Speaker 2: about the open source area you just mentioned AI. We
Speaker 2: think about open source a lot with AI, but you're
Speaker 2: actually talking about open source to build full stack web applications.
Speaker 2: When it comes to lavarel, what is the business model there?
Speaker 2: Because interestingly Chi Discovery didn't talk about how they go monetize.
Speaker 2: How already is Lavarell cloud monetizing right?
Speaker 12: Well, the thing that we love about open source, whether
Speaker 12: it is biotech and pharma or developer tooling, is that
Speaker 12: they tend to be rooted in these vibrant organic ecosystems.
Speaker 12: And if you are loyal and faithful to the ecosystem
Speaker 12: if you serve your company, your customers, and end users
Speaker 12: well over time. I think the best open source software
Speaker 12: companies in the world have demonstrated this win win capability
Speaker 12: of monetizing where you can build this revenue flywheel. But
Speaker 12: I think the best company is in open source invest
Speaker 12: the profits back into the ecosystem. They invest the profits
Speaker 12: back into enhancing the product roadmap. And that is exactly
Speaker 12: what Taylor wants to do with this capital that he's
Speaker 12: raised from Excel.
Speaker 3: It's seven million.
Speaker 2: You've also backed Versa and Century, so not unaccustomed to
Speaker 2: the open source area. Miles Climent's Excel partner, thanks for
Speaker 2: joining us today. Shares of Oracle all time his today
Speaker 2: that's his artificial intelligence demand continues to boost its cloud
Speaker 2: computing business, and there's some new agreements being made, for example,
Speaker 2: with Amazon Web Services to make intelligence. Senior analyst Ana
Speaker 2: Agrano joins us some more and Oracle managing to really
Speaker 2: focus on this new area of growth.
Speaker 13: Yeah. I think of this as the downstreaming effect and
Speaker 13: all the video sales that you're seeing, because at the
Speaker 13: end of the day, it's these cloud providers that are
Speaker 13: buying those GPUs and then in turn offering those services
Speaker 13: to clients to experiment on Genai to run new workloads.
Speaker 13: And that's really where Oracle is getting a lot of
Speaker 13: that bump. Not to mention the brand new deal that
Speaker 13: they have with AAWS.
Speaker 4: Well, let's jump on it. I don't understand the deal
Speaker 4: with AWS. I thought that for a long time they
Speaker 4: had some pretty frosty relations. Where does that work? And
Speaker 4: also that is this way about on prem versus not
Speaker 4: on prem which is a big part of Oracle's history, right.
Speaker 13: Yeah, Now, I was surprised to see this particular deal.
Speaker 13: I mean, I would say a year ago, I was
Speaker 13: surprised to see them do a deal with Microsoft and
Speaker 13: then again with Google. So a couple of things are
Speaker 13: happening over here. If I run an on premise application,
Speaker 13: it was theoretically possible for me to take that application
Speaker 13: up from my data center, move it to AWS, and
Speaker 13: at the same time run an Oracle database on it.
Speaker 13: It can be done, but it was expensive. Oracle was
Speaker 13: trying to say, well, if you want to run an application,
Speaker 13: why don't you come to my cloud, which is the
Speaker 13: oraticle cloud infrastructure, And that has been the friction. At
Speaker 13: the same time, the people want to train on the
Speaker 13: data that resides on the article database. So Articles figured
Speaker 13: out one thing that the end demand is so wide
Speaker 13: that they won't mind, you know, losing a little bit
Speaker 13: of money on one side or the other. In the
Speaker 13: net it will actually be beneficial for them if more
Speaker 13: of their databases move to the cloud. So I think
Speaker 13: for Oracle this may be actually helpful for their database
Speaker 13: business down the road. And given the shortage of workloads
Speaker 13: out there, I think they have enough in this you
Speaker 13: could say in the pipeline that for the next couple
Speaker 13: of years you're not going to have a problem in
Speaker 13: terms of their cloud growth rate.
Speaker 4: Alight, ran or a Plamberg Intelligence. Thank you. That was
Speaker 4: the analysis. Let's get the take from one of the
Speaker 4: companies involved in bringing ruber BORNO VP of Worldwide Channels
Speaker 4: and Alliances at AWUS. I'd love to start Ruba by
Speaker 4: say say be asking how this deal and how this
Speaker 4: relationship with Oracle came about.
Speaker 10: Thank you for having me ed.
Speaker 8: It's great to be here.
Speaker 10: We always work backwards from our customers and just like
Speaker 10: Unerug said, the pace of innovation is accelerating and with
Speaker 10: generative AI our customers want to be able to take
Speaker 10: advantage of their biggest assets, which is their data. That's
Speaker 10: their differentiation, and so with this partnership, we're announcing that
Speaker 10: customers can move their data seamlessly from Oracle Database at
Speaker 10: AWS to AWS in order to be able to take
Speaker 10: advantage of their assets and innovate at the pace that's
Speaker 10: required today.
Speaker 2: Ribo, what do you make of perhaps Anerog's take that
Speaker 2: this was surprising There is sort of frenemies going on
Speaker 2: at the moment.
Speaker 3: What is it like working alongside Oracle.
Speaker 10: You know, we've actually been working alongside them for a
Speaker 10: very long time. In fact, we've had joint customers with
Speaker 10: Oracle since two thousand and eight. So our focus has
Speaker 10: always been working backwards from the custom it's in our DNA,
Speaker 10: and the time was right for us to bring this
Speaker 10: offer to our customers as they're thinking about how to
Speaker 10: transform their businesses.
Speaker 8: They want to move faster.
Speaker 10: They want to be able to take the data that
Speaker 10: they have stored in Oracle and be able to take
Speaker 10: advantage of aws's large offerings of services like Amazon Q,
Speaker 10: Amazon Bedrock, the other services that they've gotten accustomed to,
Speaker 10: and that made it the time right right now for
Speaker 10: us to work together. So it's not new, we've been
Speaker 10: doing it for a long time, but it became a
Speaker 10: lot more urgent to support our customers on their transformations.
Speaker 4: Rub We got a lot of questions from Morbeling technology
Speaker 4: audience that have a relationship with either AWS, Oracle or both,
Speaker 4: and they're very simple, like how does this work in practice?
Speaker 4: Is there revenue split or revenue sharing? What are the
Speaker 4: obligations that the customer has to sign up to?
Speaker 10: Well, we're not sharing our own commercial terms between AWS
Speaker 10: and Oracle. But from a customer perspective, this is a
Speaker 10: great opportunity for customers to leverage this service. They've got
Speaker 10: their existing relationship with Oracle, their existing relationship with AWS.
Speaker 10: When we launch it later this year, we'll provide all
Speaker 10: of that information to our customers, but it should be
Speaker 10: just as seamless. It'll be single billing through their AWS console,
Speaker 10: the same way they subscribe to any services from AWS.
Speaker 2: Your very title, RUBA is alliances? Is this a new
Speaker 2: world of alliances at the moment as people search out compute,
Speaker 2: as they work within operators, are you seeing that more
Speaker 2: and more?
Speaker 3: Globally speaking?
Speaker 10: I think that we've been seeing it for a long time.
Speaker 10: AWS has the largest cloud native partner network in the world,
Speaker 10: and we've had that because it is in our ethos
Speaker 10: to provide our customers with choice and provide them with
Speaker 10: simplicity so that they can run their businesses as seamlessly
Speaker 10: as possible and innovate not just through AWS first party services,
Speaker 10: but also through the breadth of third party services that
Speaker 10: they need to run their businesses. It's not a new
Speaker 10: concept for AWS, and we're trying to make it easier
Speaker 10: on our customers to take advantage of all of that innovation.
Speaker 4: Just very quickly. Are you seeing more SMEs kind of
Speaker 4: take note now we're trying to move beyond sort of
Speaker 4: the biggest companies thinking about their access to compute and
Speaker 4: the software that they're using.
Speaker 10: Absolutely, I mean small medium enterprises are continuing to be
Speaker 10: a high growth engine for technology adoption. I wouldn't say
Speaker 10: that they've been laggards, but they are now certainly moving faster.
Speaker 10: It is easier for them to take advantage of it,
Speaker 10: and so we are working directly with those customers. We
Speaker 10: are working through many of our channel partners to reach
Speaker 10: those customers and help them adopt innovation that's available in
Speaker 10: the cloud, and so we'll continue to see that. We're
Speaker 10: going to continue to build services with them, for them and.
Speaker 2: With our partners Rivavona, VP of Worldwide Channels, Analyances and AWS.
Speaker 2: Busy time and we thank you now it's been a
Speaker 2: busy time for the show as well. That does it
Speaker 2: for this edition of Bloomberg Technology.
Speaker 3: So many market moves, more guests to come out.
Speaker 4: Yeah, tomorrow, we're going to be joined by Waimo co
Speaker 4: CEO Takedra Manakar for an exclusive interview. A lot of
Speaker 4: data points coming out of Weaimo and a lot of
Speaker 4: questions ask about the ongoing tie up with Alphabet, parent
Speaker 4: of Google. Don't forget also to check out the podcast.
Speaker 4: You know where to find it on the Bloomberg terminal
Speaker 4: as well as online on Apple, Spotify, and iHeart from
Speaker 4: the team out in New York City and all the
Speaker 4: team here in San Francisco. This is Bloomberg Technology.