WEBVTT - US Targets China EVs With Tariffs, More Tech Earnings 0:00:01.600 --> 0:00:06.880 From Mahard where Innovation, Money and Power Collie in Silicon Valley, NBN. 0:00:07.240 --> 0:00:10.520 This is Bloomberg Technology with Caroline Hyde and. 0:00:10.640 --> 0:00:11.480 Ed lud Love. 0:00:24.880 --> 0:00:27.840 And Caroline Hyde in San Francisco. Ed Lulow is off. 0:00:28.080 --> 0:00:30.680 This is Bloomberg Technology coming up the US set to 0:00:30.800 --> 0:00:35.320 unveil sweeping tarras on China targeting EVS, batteries and more 0:00:35.800 --> 0:00:38.839 details ahead. Plus we'll sit down with the CEOs of 0:00:38.880 --> 0:00:42.199 Grinder of Akamai to break down their latest earnings results 0:00:43.000 --> 0:00:47.240 and Apple apologizing for its latest ad after the online backlash. 0:00:47.400 --> 0:00:50.560 We'll discuss that and so much more throughout this hour. First, 0:00:50.880 --> 0:00:52.840 it's going to quick check on these markets and look, 0:00:52.880 --> 0:00:55.720 it is three straight weeks of games, folks. That is 0:00:55.760 --> 0:00:58.160 the best winning street we've seen since back in February. 0:00:58.200 --> 0:00:59.960 But on the day, we're actually just pulling back a little, 0:01:00.160 --> 0:01:03.280 only two percent on the NASDAK. Some mixed economic data 0:01:03.280 --> 0:01:06.399 coming through, in particular some of the confidence consumer confidence 0:01:06.480 --> 0:01:10.080 actually falling quite significantly in the previous month. That because 0:01:10.120 --> 0:01:14.319 of lingering inflationary issues, labor side concerns. But nevertheless we're 0:01:14.319 --> 0:01:16.200 down some two tens percent. But the sock six hundred 0:01:16.200 --> 0:01:17.800 over in Europe on a tear are up eight tens 0:01:17.840 --> 0:01:19.959 ofven percent, and in fact we are have just a 0:01:20.000 --> 0:01:23.039 real run of good gains in Europe as we see 0:01:23.240 --> 0:01:26.520 earnings beat time after time, every single industry group up 0:01:26.560 --> 0:01:29.280 to finish the day over in Europe. Bitcoin echoing some 0:01:29.319 --> 0:01:31.919 of that slight risker version, but notably we're also seeing 0:01:32.120 --> 0:01:35.520 well the first time you're seeing crypto exchange volume are 0:01:35.520 --> 0:01:39.839 actually falling in about seven months. So post bitcoin etf 0:01:40.080 --> 0:01:42.759 slight pullback, slight reality bump, we're off by two point 0:01:42.760 --> 0:01:44.240 six percent. Move on, have a look at some of 0:01:44.319 --> 0:01:47.120 the individual movers that we're looking on the micro perspective, 0:01:47.520 --> 0:01:49.960 and Warner brother Discovery actually your best performer when you're 0:01:49.960 --> 0:01:52.720 looking at the Nasdaq one hundred at more than three percent. Yesterday, 0:01:52.800 --> 0:01:55.840 Lucashaw breaking the news that David Saslav is looking to 0:01:55.880 --> 0:01:58.600 control costs here once again. Maybe even more job cuts come. 0:01:58.720 --> 0:02:01.280 Remember they've already fired some two thousand people. We could 0:02:01.320 --> 0:02:05.240 see a real focus on ultimately profitability at the moment. 0:02:05.240 --> 0:02:08.560 For Warner Brothers Discovery, we're seeing actually Apple off by 0:02:08.600 --> 0:02:10.720 more than a percentage point. That we'll get into the 0:02:10.720 --> 0:02:13.800 woes that is the pulling of the ad when it 0:02:13.800 --> 0:02:18.000 comes to the iPad that's seemingly crushing of ingenuity and 0:02:18.160 --> 0:02:22.200 human expression, suddenly not being liked. Apple apologizes we were 0:02:22.200 --> 0:02:24.760 down a percentage point. Tesla also down two point three 0:02:24.760 --> 0:02:27.919 percent earlier. I've been training higher. Now Is this something 0:02:27.919 --> 0:02:29.440 to do with the fact that now we've got a 0:02:29.480 --> 0:02:32.560 flip reverse on what Elon Musk is currently doing with superchargers. Yes, 0:02:32.600 --> 0:02:34.800 he is going to be selling focusing on some five 0:02:34.919 --> 0:02:38.200 hundred million dollars of investment in that area, swift reversal 0:02:38.200 --> 0:02:40.040 from what we'd heard the previous week, the fact that 0:02:40.080 --> 0:02:43.679 he was of course firing the entire team of the superchargers. 0:02:44.080 --> 0:02:46.720 But also is this more to do with geopolitics? Is 0:02:46.760 --> 0:02:48.120 this more to do with the fact that the Biden 0:02:48.120 --> 0:02:51.480 administration is potentially set to unveil a sweeping decision on 0:02:51.560 --> 0:02:55.040 China tarras next week, targeting key industries, including of for 0:02:55.120 --> 0:02:58.520 Tesla's perspective, electric vehicles and batteries and solar cells. Would 0:02:58.520 --> 0:03:01.679 that mean we get Chinese backlack on US producers such 0:03:01.680 --> 0:03:04.720 as Tesla joining US and Wall Bloomberg's Mike Shephard, who's 0:03:04.720 --> 0:03:08.280 in Washington, and my incredible reporting coming from the team 0:03:08.400 --> 0:03:11.720 at Bloomberg, and it does seem that what this is 0:03:11.840 --> 0:03:15.440 finally after years of decision, more focus on China and 0:03:15.480 --> 0:03:16.359 a targeted manner. 0:03:17.960 --> 0:03:20.040 Well, it certainly is, and I'm glad you brought it 0:03:20.120 --> 0:03:22.639 up in that context. The team did such a terrific 0:03:22.760 --> 0:03:26.280 job really going after this for weeks and weeks to 0:03:26.360 --> 0:03:29.480 try to figure out when and in what manner this 0:03:29.600 --> 0:03:33.480 decision would take place and how it would hit. And 0:03:33.600 --> 0:03:35.960 it is really shaping up in those three areas that 0:03:36.000 --> 0:03:38.400 you outlined. This is going to be one of the 0:03:38.400 --> 0:03:42.200 most significant moves that Biden has made since taking office 0:03:42.280 --> 0:03:44.640 with respect to China. It is one of the most 0:03:44.640 --> 0:03:48.760 consequential because it affects that big round of tariffs that 0:03:48.800 --> 0:03:51.880 Donald Trump announced back in twenty eighteen, and that has 0:03:51.920 --> 0:03:53.960 been the subject of a lot of back and forth 0:03:54.040 --> 0:03:56.520 with the world's second largest economy since then. 0:03:58.720 --> 0:04:02.560 Therefore, are we expecting more back and forth? Are we 0:04:02.640 --> 0:04:05.040 bracing ourselves to the fact that if this comes that 0:04:05.120 --> 0:04:08.240 this does indeed target more of the evs, the solar 0:04:08.640 --> 0:04:11.360 anity We've already seen some focus on metals, even though 0:04:11.400 --> 0:04:14.040 then have a broad implication. Are we going to have 0:04:14.080 --> 0:04:15.640 more tip for tat here is China going. 0:04:15.600 --> 0:04:19.560 To respond, Well, China respond to this morning at least 0:04:19.600 --> 0:04:24.599 with a verbal volley objecting to this. You'll recall that, 0:04:24.720 --> 0:04:27.920 you know, with the emergence of news about the export 0:04:28.000 --> 0:04:32.920 controls aimed against Huahwei, that they saw that as economic coercion. 0:04:33.560 --> 0:04:36.960 They're complaining about this as well. The response to the 0:04:37.000 --> 0:04:40.200 news last night was swift from the Chinese government. 0:04:40.480 --> 0:04:41.359 They're concerned. 0:04:41.640 --> 0:04:44.320 However, the retaliation from China may not come in the 0:04:44.400 --> 0:04:48.240 areas that are directly aligned with the policy that we're seeing, 0:04:48.640 --> 0:04:52.440 and we'll expect next week. Senator Chuck Grassley, according to 0:04:52.480 --> 0:04:55.000 our reporting, is indicating that we may see a retaliation 0:04:55.160 --> 0:04:59.719 in agricultural products, trying to hit America where it hurts 0:05:00.080 --> 0:05:02.599 a different place, and it's something that in the past 0:05:02.880 --> 0:05:04.320 has been targeted by Beijing. 0:05:05.400 --> 0:05:06.839 Just to stay with us, Mike, we've got some breaking 0:05:06.880 --> 0:05:08.839 news this being reported by the Wall Street Journal. So 0:05:08.880 --> 0:05:12.160 building on the Bloomberg reporting that apparently min administration is 0:05:12.160 --> 0:05:17.280 actually going to quadruple tariffs on Chinese evs. Now, how 0:05:17.680 --> 0:05:21.080 broader implication is that, considering not many electric vehicles are 0:05:21.080 --> 0:05:23.239 actually shipped from China to the United States. 0:05:24.480 --> 0:05:28.200 Well, you're right, and the whole idea of this, at 0:05:28.279 --> 0:05:31.800 least with EVS is it's symbolic in a way, it's 0:05:31.800 --> 0:05:35.000 low cost for the Biden administration to quadruple EVS because 0:05:35.040 --> 0:05:38.640 there is no consumer impact at home. Remember, when you 0:05:38.760 --> 0:05:42.440 raise tariffs, it is not the country that is targeted 0:05:42.440 --> 0:05:44.880 with the tariffs that pays the cost. It is actually 0:05:44.960 --> 0:05:49.839 the consumers in the purchasing country that actually pay the price, 0:05:50.120 --> 0:05:54.080 and in this case there are. China does not have 0:05:54.200 --> 0:05:57.200 much of an ev market presence here in the US 0:05:57.240 --> 0:06:00.520 with its makers, So the administration is trying to do 0:06:00.560 --> 0:06:03.520 two things. It's trying to show that it's tough without 0:06:03.560 --> 0:06:05.839 imposing too much cost, but it is also trying to 0:06:05.880 --> 0:06:08.640 create a bullwark so that it is harder for Chinese 0:06:08.640 --> 0:06:11.440 makers to break into the US market, which is becoming 0:06:11.480 --> 0:06:14.320 increasingly amenable to the idea of EVS. 0:06:15.400 --> 0:06:17.839 We'll see also what Europe does. We know that Europe 0:06:17.839 --> 0:06:20.200 has been focusing a lot on EVS when it comes 0:06:20.240 --> 0:06:22.719 to China as well. Mike Shepherd bring in to have you, 0:06:22.880 --> 0:06:24.840 thank you so much on the latest when it comes 0:06:24.880 --> 0:06:27.920 to tariffs. Now, all of this, well is the context 0:06:27.920 --> 0:06:30.440 with which you're trying to invest more broadly across assets 0:06:30.480 --> 0:06:33.160 At the moment, the geopolitics is a key headwind. Let's 0:06:33.240 --> 0:06:35.280 dive into that and the impact on equities in tech 0:06:35.320 --> 0:06:37.920 in particular with Mona Mahazan. She's senior investment strategist to 0:06:38.040 --> 0:06:41.320 Edward Jones. And once again we're just Monas seeing more 0:06:41.360 --> 0:06:46.560 and more navigation necessary by big tech companies of geopolitics. 0:06:46.600 --> 0:06:49.520 Is that an overhang for you? Yeah? 0:06:49.600 --> 0:06:51.800 Thanks, Carolyn, It's a great question. Look, I think as 0:06:51.839 --> 0:06:54.760 we get closer and closer at election time period, we 0:06:54.839 --> 0:06:56.840 will be hearing more and more about the policies that 0:06:56.920 --> 0:06:59.520 both sides of the aisle will be proposing, and a 0:06:59.560 --> 0:07:02.000 lot of times what we see is the impact is 0:07:02.440 --> 0:07:05.039 felt in an outside way way in certain sectors, and 0:07:05.200 --> 0:07:07.480 technology is certainly one of them. I'd point to healthcare 0:07:07.520 --> 0:07:12.760 as another, depending on regulation and policy that's administered. Higher taxes, 0:07:12.840 --> 0:07:16.840 as was noted earlier, higher tariffs taxes in general does 0:07:16.920 --> 0:07:19.400 tend to be inflationary, so we have to think about that. 0:07:19.480 --> 0:07:22.280 Will the administration want to take that step or is 0:07:22.280 --> 0:07:25.679 this more symbolic in nature in that we don't want 0:07:25.760 --> 0:07:28.760 to one enter a more meaningful trade war with China, 0:07:28.800 --> 0:07:31.520 but two we want to signal to them that they 0:07:31.600 --> 0:07:35.000 cannot be flooding the market, whether it's EVS or any 0:07:35.040 --> 0:07:38.760 other end market or good that they may be trying 0:07:38.800 --> 0:07:41.280 to get into into the US. So keep in mind 0:07:41.320 --> 0:07:43.000 some of it is signaling, some of it has real 0:07:43.160 --> 0:07:47.080 meaningful implications for areas like technology. But we will get 0:07:47.120 --> 0:07:50.200 more and more insight into how these policies manfold. I 0:07:50.240 --> 0:07:53.040 think as we get closer to the November time period, 0:07:53.320 --> 0:07:56.120 I'd say more broadly, we are looking at a market 0:07:56.160 --> 0:07:59.600 that has been driven still by the momentum behind AI 0:07:59.640 --> 0:08:03.640 and tech anology and megacap technology in particular, But we 0:08:03.720 --> 0:08:06.160 do expect that to broaden over time. 0:08:07.080 --> 0:08:11.360 And can that broadening with stan still issues you mentioned 0:08:11.360 --> 0:08:14.280 infrastory pressure coming from Taris. Infrastry pressure is still something 0:08:14.320 --> 0:08:16.400 that the FED is still very focused on. We're hearing 0:08:16.400 --> 0:08:18.160 from many a FED member at the moment saying we're 0:08:18.160 --> 0:08:20.200 going to be higher for longer. We see the stocks 0:08:20.280 --> 0:08:21.520 just take a little bit of a dip on the 0:08:21.520 --> 0:08:25.680 back of that context, Mona, are you expecting inflatory headwinds 0:08:25.720 --> 0:08:27.840 to limit some of the increase in the stock markets 0:08:27.840 --> 0:08:28.160 from here? 0:08:29.080 --> 0:08:32.120 You know, Actually we are in the Jerome Powell camp, 0:08:32.240 --> 0:08:34.480 who he did outline. You know, he had the famous 0:08:34.520 --> 0:08:36.520 line he doesn't see the stag and he doesn't see 0:08:36.520 --> 0:08:39.280 the flation. We are also of the mindset that we 0:08:39.320 --> 0:08:42.360 do think inflation can gradually, perhaps not in a straight line, 0:08:42.360 --> 0:08:45.760 but gradually move more meaningfully towards at two percent target. 0:08:45.880 --> 0:08:48.640 For a couple of reasons. One, we do see that 0:08:48.720 --> 0:08:51.280 shelter and rent component playing some catch up. We are 0:08:51.320 --> 0:08:52.920 seeing the data in real time if you look at 0:08:52.920 --> 0:08:56.280 a ZILLA rent index move meaningfully lower. That has not 0:08:56.440 --> 0:08:58.920 yet showed up in any of the CPI baskets, And 0:08:58.960 --> 0:09:01.560 even the PC basket, which is a lower part has 0:09:01.600 --> 0:09:04.959 a lower exposure to shelter and rent still hasn't moved 0:09:05.000 --> 0:09:08.079 meaningfully lower, So we think that's coming. Number two, we 0:09:08.120 --> 0:09:12.720 are starting to see more meaningful potential slowdown in the 0:09:12.760 --> 0:09:16.000 wage gains component of the labor market. So labor market 0:09:16.280 --> 0:09:18.640 a couple of early signals of softening, not only the 0:09:18.679 --> 0:09:20.679 non farm jobs are poured on Friday, but also the 0:09:20.760 --> 0:09:24.760 jobless claims figure this week was elevated. We think over 0:09:24.840 --> 0:09:27.200 time there'll be better balanced in the labor force, more 0:09:27.200 --> 0:09:30.480 supply coming in, less demand for jobs, which will lead 0:09:30.520 --> 0:09:33.560 to softer wage gains, which has a direct implication on 0:09:33.679 --> 0:09:36.520 services inflation. So a combination of shelter and rent and 0:09:36.600 --> 0:09:39.000 a softening labor market we think will lead to better 0:09:39.040 --> 0:09:41.560 inflationary trends going forward. 0:09:42.200 --> 0:09:43.360 That, combined with. 0:09:43.320 --> 0:09:46.600 This earnings growth picture that we are seeing continuing to 0:09:46.679 --> 0:09:50.439 outperform and improve meaningfully, we think is a good headwind 0:09:50.880 --> 0:09:53.040 or sorry, tailwind for equities broadly. 0:09:54.280 --> 0:09:57.440 Interestingly, here in San Francisco, the one key thing that 0:09:57.440 --> 0:10:00.800 comes up time and time again is how expensive engineers are. 0:10:01.240 --> 0:10:04.240 Whether it's particularly in the field of AI, software developers 0:10:04.240 --> 0:10:06.800 a little bit less but still arguably about a million 0:10:06.840 --> 0:10:09.080 in terms of their overall pay at the moment. Mona, 0:10:09.160 --> 0:10:12.520 I'm interested in what you make there for of AI, 0:10:13.640 --> 0:10:16.760 the tailwinds of AI more broadly, are we going to 0:10:16.760 --> 0:10:19.800 see you mentioned the broadening out which industry groups in 0:10:19.840 --> 0:10:22.080 particular is the healthcare industry groups that we start to 0:10:22.080 --> 0:10:22.640 pile into. 0:10:23.640 --> 0:10:25.719 Yeah, you know, it's a great point because thus far, 0:10:25.800 --> 0:10:28.760 what we've seen is most of the gains from the 0:10:28.760 --> 0:10:31.240 AI trade have been felt by the enablers of AI, 0:10:31.400 --> 0:10:35.080 the infrastructure players, the semiconductors for example. We do think 0:10:35.160 --> 0:10:37.680 over time you will see the sectors that will benefit 0:10:37.720 --> 0:10:40.480 from the productivity gains of AI start to place a 0:10:40.559 --> 0:10:43.880 meaningful catchup as well. They mentioned healthcare, that's certainly one 0:10:43.880 --> 0:10:46.479 of the sectors, but if you look at financial services, 0:10:46.520 --> 0:10:50.040 if you look at manufacturing and industrials, all of those 0:10:50.040 --> 0:10:53.120 sectors we think will be beneficiaries. And this is over 0:10:53.280 --> 0:10:55.680 you know, not a twelve month period, but probably more 0:10:55.720 --> 0:10:58.240 like a three to five year period. We will start 0:10:58.280 --> 0:11:00.439 to see those productivity gains come through. And keep in 0:11:00.520 --> 0:11:03.120 mind those sectors are not only prevalent here in the US, 0:11:03.200 --> 0:11:07.400 but globally. When you think about where manufacturing, financials, industrials 0:11:07.600 --> 0:11:10.280 tend to lie, it does tend to be in non 0:11:10.480 --> 0:11:12.600 US markets as well. So we think there is a 0:11:12.640 --> 0:11:15.160 case to be made to have exposure to the US. 0:11:15.360 --> 0:11:18.400 We like having exposure that megacap technology, but also the 0:11:18.480 --> 0:11:21.360 sectors that may benefit from AI, but also international we 0:11:21.440 --> 0:11:23.720 think still plays a meaningful part of your portfolio. 0:11:24.600 --> 0:11:27.120 Thanks for going global with us. We love it. Menahajen, 0:11:27.200 --> 0:11:29.760 great to have you on Senior Investments. Stanks Jone had 0:11:29.880 --> 0:11:33.160 Edward Jones stay well, happy weekend. Meanwhile, well, look, maybe 0:11:33.200 --> 0:11:34.920 not a happy weekend for some if you're looking at 0:11:34.960 --> 0:11:37.600 the infrastructure here in the US, it's severe solar storm 0:11:37.960 --> 0:11:40.880 is expected this weekend and it threatens to trigger blackouts, 0:11:40.920 --> 0:11:44.800 disrupt navigation systems, knock out high frequency radios around the world. 0:11:45.040 --> 0:11:46.760 And this is the first time, it's January two thousand 0:11:46.800 --> 0:11:49.160 and five that the US Space where the Prediction Center, 0:11:49.160 --> 0:11:52.640 has actually issued a G four geomagnetic storm watch. It's 0:11:52.679 --> 0:11:54.839 the second highest on a five step scale, and it 0:11:54.920 --> 0:11:57.720 says multiple waves of solar energy are going to be 0:11:57.720 --> 0:12:00.520 bearing down on the planet now five eruptions, some material 0:12:00.600 --> 0:12:03.400 from the Sun's atmosphere of forecast to arrive starting late 0:12:03.400 --> 0:12:08.520 on Friday and persist through Sunday. Coming up, we'll hear 0:12:08.559 --> 0:12:13.040 from Snapchat CEO Evan Spiegel. Spiegel when talking all things 0:12:13.120 --> 0:12:17.120 social media as TikTok ban looms here in the United States, 0:12:17.240 --> 0:12:20.000 what did he have to say at yesterday's San Francisco 0:12:20.040 --> 0:12:22.679 tech e Ben Meanwhile, t SMC on an absolute tear. 0:12:22.760 --> 0:12:24.720 Let's focus in on the fact that it's April sales 0:12:24.800 --> 0:12:28.240 jumped sixty percent. You won't guess that it's a stayed 0:12:28.240 --> 0:12:30.880 demand for AI chips with me, there's a broadening out 0:12:30.880 --> 0:12:32.840 here as well. We've seen perhaps a bit of a 0:12:32.840 --> 0:12:35.360 bottoming out in the global smartphone industry as well, returning 0:12:35.400 --> 0:12:37.920 to growth for them. We're seeing it really paying out 0:12:37.960 --> 0:12:40.720 for the world's largest contract chip maker, this will be 0:12:40.760 --> 0:12:53.880 their technology time now for Talking Tech first up Elon 0:12:53.960 --> 0:12:57.680 Musk's U turn on superchargers Now, the Tesla founder says 0:12:57.880 --> 0:13:01.400 that the company will still spend well over five hundred 0:13:01.440 --> 0:13:03.559 million dollars to grow its charging network this year. Now. 0:13:03.559 --> 0:13:06.320 The news comes just over a week when Tesla actually 0:13:06.320 --> 0:13:09.720 fired nearly roughly five hundred people who were running the 0:13:09.800 --> 0:13:14.160 charging business plus for years. Now. Soft Bank has quietly 0:13:14.160 --> 0:13:16.680 sold off billions of dollars of assets from its flagship 0:13:16.760 --> 0:13:19.600 Vision Fund now, a sign that basically found in Masseosti's 0:13:19.600 --> 0:13:23.040 son is shifting away from broader venture capital deals towards 0:13:23.080 --> 0:13:25.000 investments in just semiconductors and AI. 0:13:25.240 --> 0:13:25.320 Now. 0:13:25.360 --> 0:13:27.240 Since the end of twenty twenty one, soft Bank's Vision 0:13:27.240 --> 0:13:31.199 funds sort its US portfolio shrink almost twenty nine billion dollars, 0:13:31.960 --> 0:13:34.920 and Microsoft enters the mobile gaming arena, announcing it will 0:13:34.960 --> 0:13:38.000 launch its own version of a mobile game store by July, 0:13:38.280 --> 0:13:40.160 taking on the likes of Apple and Google Now, the 0:13:40.160 --> 0:13:43.520 browser based store will debut Microsoft's own games and offer 0:13:43.600 --> 0:13:46.960 discounts on in game items Misoft says that eventually it 0:13:46.960 --> 0:13:49.680 will open the store to other publishers at a later date. 0:13:50.720 --> 0:13:53.880 Let's turn from gaming to social and snap CEO Evan 0:13:53.920 --> 0:13:57.280 Spiegel is urging the government to develop a more comprehensive 0:13:57.320 --> 0:14:01.319 framework for dealing with national security issues. Social media rival 0:14:01.400 --> 0:14:05.280 TikTok faces a divestment or band ultimatum. Now here's part 0:14:05.320 --> 0:14:07.160 of what he had to say at Bluebog's technology event 0:14:07.200 --> 0:14:07.880 in San Francisco. 0:14:09.880 --> 0:14:13.360 Always focused on communication between family and friends and making 0:14:13.400 --> 0:14:16.079 that really fast and fun and visual, and I think 0:14:16.080 --> 0:14:18.600 that's why we've been able to continue to grow through 0:14:18.640 --> 0:14:21.000 all the changes that you mentioned. Now reach more than 0:14:21.040 --> 0:14:23.760 eight hundred million people. So, you know, I think just 0:14:23.800 --> 0:14:28.000 sticking you know, really staying focused on those close relationships. 0:14:28.160 --> 0:14:30.040 They're the relationships that mean the most to us, are 0:14:30.040 --> 0:14:31.560 the people we talk to most frequently. 0:14:31.880 --> 0:14:34.560 And enriching that, you know, through Snapchat. 0:14:34.160 --> 0:14:37.440 With visual communication, with stories, with the math that allows 0:14:37.440 --> 0:14:39.520 people to see what their friends are up to, where 0:14:39.520 --> 0:14:41.920 they are, what they're doing. All these sorts of products 0:14:41.920 --> 0:14:44.040 I think help bring people close together with the people 0:14:44.160 --> 0:14:45.960 that mean the most to them. And I think that's 0:14:46.000 --> 0:14:48.360 really what's you know, led to our just enduring growth. 0:14:48.880 --> 0:14:52.160 We actually have a poll, a TikTok specific poll. 0:14:52.680 --> 0:14:54.680 What is your opinion on the TikTok ban. 0:14:55.320 --> 0:14:58.440 I'll be bummed when TikTok is banned. TikTok should be 0:14:58.520 --> 0:15:04.040 totally banned care either way, So please vote. Are you 0:15:04.080 --> 0:15:07.080 a TikTok should be totally banned kind of guy like that? 0:15:07.160 --> 0:15:08.760 Seems like it would be an opportunity for you. 0:15:08.840 --> 0:15:09.760 It's probably a no brainer. 0:15:12.360 --> 0:15:18.960 But really, what I think is is really important is 0:15:19.000 --> 0:15:21.800 that we come up with a durable framework to deal 0:15:21.840 --> 0:15:24.240 with these sorts of national security issues. I think the 0:15:24.320 --> 0:15:26.680 United States has recognized that there are these issues, but 0:15:27.000 --> 0:15:28.800 has sort of been dealing with them in sort of 0:15:28.800 --> 0:15:31.560 an ad hoc, one off kind of way, And I 0:15:31.600 --> 0:15:33.960 think that has real implications for the economy looking forward. 0:15:34.000 --> 0:15:35.240 If you think about how. 0:15:35.040 --> 0:15:37.520 Many businesses in the United States, you know, have a 0:15:37.560 --> 0:15:40.160 relationship with China, you know, whether or not they manufacture 0:15:40.200 --> 0:15:42.600 there or they sell their products there. I think it's 0:15:42.640 --> 0:15:45.040 going to be really important for those businesses here in 0:15:45.040 --> 0:15:47.720 the United States to get a lot of clarity around 0:15:47.760 --> 0:15:50.320 what the government thinks is totally okay. Maybe that's like 0:15:50.400 --> 0:15:53.120 kids toys and diapers and those sorts of things, no problem, 0:15:53.680 --> 0:15:56.560 you know, but sensitive technology chips, you know, things that 0:15:56.600 --> 0:15:59.120 could be used in weapons, probably not okay. And I 0:15:59.160 --> 0:16:01.160 think the sooner that the United States government can be 0:16:01.240 --> 0:16:04.080 clear about the areas where they think business cooperation makes 0:16:04.080 --> 0:16:06.160 a lot of sense, and also clear about the areas 0:16:06.160 --> 0:16:09.080 where it's you know, maybe not not okay, the more 0:16:09.120 --> 0:16:11.120 stability we can have in our economy, and I think 0:16:11.160 --> 0:16:14.200 we can you know, maybe better strengthen that relationship. 0:16:14.240 --> 0:16:15.720 I think it's the uncertainty that's tricky. 0:16:15.840 --> 0:16:17.600 So you know, I think the more the government can 0:16:17.600 --> 0:16:20.320 share about how they're thinking about those risks and you know, 0:16:20.360 --> 0:16:22.480 really create some clarity for business, that'll be helpful. 0:16:22.560 --> 0:16:25.160 Now TikTok's not banned yet, there is uncertainty for some 0:16:25.200 --> 0:16:29.080 of their really important stakeholders, like creators or advertisers. What 0:16:29.160 --> 0:16:31.760 are you guys doing to take advantage of that uncertainty 0:16:31.840 --> 0:16:32.200 right now? 0:16:32.880 --> 0:16:34.400 The most important thing we can do is just focus 0:16:34.480 --> 0:16:36.760 on our own business. Folks have lots of alternatives when 0:16:36.760 --> 0:16:38.720 it comes to short video. You know, they can use Spotlight, 0:16:38.720 --> 0:16:40.960 which is on our platform, or YouTube. 0:16:40.520 --> 0:16:42.320 Shorts or you know, Instagram reels. 0:16:42.720 --> 0:16:44.680 So I think there are a lot of different opportunities 0:16:44.640 --> 0:16:47.240 in the short video space. So what we've continued to 0:16:47.280 --> 0:16:49.800 do is just focus on what creators love about our platform, 0:16:49.840 --> 0:16:52.520 which is the relationship they can form with their audience, 0:16:52.600 --> 0:16:55.720 and that's primarily through our stories products. So creators love 0:16:55.800 --> 0:16:58.720 using stories to just show what they're doing throughout their day. 0:16:58.760 --> 0:17:01.880 And because we revenue, creators don't feel pressure to do 0:17:01.920 --> 0:17:05.400 all these brand deals. So Snapchat content just feels very authentic, 0:17:05.440 --> 0:17:07.359 which is why their viewers and their audience, you know, 0:17:07.400 --> 0:17:09.440 really love it and why that resonates with them. 0:17:09.640 --> 0:17:11.680 And then they use tools like Spotlight. 0:17:11.240 --> 0:17:13.960 To get more distribution to help people discover them so 0:17:14.000 --> 0:17:16.199 that they'll add them and watch their story on an 0:17:16.240 --> 0:17:19.040 ongoing basis. So I think that's a pretty unique value 0:17:19.040 --> 0:17:21.840 proposition we have for creators, and we're just going to, 0:17:21.920 --> 0:17:23.280 you know, really stay focused on that. 0:17:25.119 --> 0:17:38.960 Snap CEO even Spiegel yesterday, let's talk earnings now, with 0:17:39.040 --> 0:17:42.600 Grinder posting its first quarter results showing revenue growth thirty 0:17:42.600 --> 0:17:44.919 five percent year every year, let's discuss all of it, 0:17:44.960 --> 0:17:47.280 the margin as well, and the expansion of products. Grinder 0:17:47.359 --> 0:17:50.200 CEO George Arrison is here with me, and George you're 0:17:50.240 --> 0:17:52.200 saying in your statement, this is a really strong set 0:17:52.200 --> 0:17:55.399 of numbers. Still loss making, but much smaller loss. 0:17:56.040 --> 0:17:59.159 How are you not a real lass from the financial perspective, 0:17:59.320 --> 0:18:02.440 because it's all weren't related, So we'd have warrants because 0:18:02.520 --> 0:18:04.800 we did as back and warrants are held as a 0:18:04.880 --> 0:18:08.360 liability right, and so when you're we have an operating 0:18:08.359 --> 0:18:11.040 profit and then a loss because of the warrants. So 0:18:11.080 --> 0:18:13.159 from the business perspective, we didn't lose anyone and. 0:18:13.480 --> 0:18:16.520 An adjusted EBITDAR that's showing margin, that's improving. 0:18:17.320 --> 0:18:19.280 I mean, we did very well on even are fourty 0:18:19.320 --> 0:18:21.320 two percent, which I think is really healthy. And we're 0:18:21.359 --> 0:18:22.680 investing in the busines at the same time. 0:18:22.760 --> 0:18:24.639 So and where are you investing because you do talk 0:18:24.680 --> 0:18:26.920 about your product roadmap. In fact, you're bringing two key 0:18:26.960 --> 0:18:30.160 products to bear a lot of technical innovation that comes 0:18:30.160 --> 0:18:31.000 to the chat parts. 0:18:31.080 --> 0:18:33.080 Well, yeah, so that was a really big launch for us. 0:18:33.119 --> 0:18:35.760 We launched a new chat architecture. People would lose chats 0:18:35.760 --> 0:18:37.520 every time they switched phones before and there was a 0:18:37.600 --> 0:18:40.080 huge complaint. So that's not going to happen anymore because 0:18:40.119 --> 0:18:42.600 chats were hosted locally on your device, So we moved 0:18:42.640 --> 0:18:46.520 away from that. We are when I joined, we didn't 0:18:46.560 --> 0:18:48.639 really have a long term part problemap. We spent a 0:18:48.640 --> 0:18:51.359 lot of time last year working on that. We believe 0:18:51.359 --> 0:18:54.640 there's huge extension opportunities for the product, extending it into 0:18:54.720 --> 0:18:57.800 more into dating, building feature sets to support dating and 0:18:57.920 --> 0:19:00.239 do that not in terms of what other people did day, 0:19:00.320 --> 0:19:03.119 but what dating world will look like in two years 0:19:03.160 --> 0:19:05.879 one A What like, well, AI is going to be first, right, Like, 0:19:05.960 --> 0:19:09.520 I think people will expect that social networks will actually 0:19:10.280 --> 0:19:14.240 drive connections through AI rather than through filtering, because today 0:19:14.359 --> 0:19:16.600 the dating problems haven't really fundamentally changed. It is you 0:19:16.640 --> 0:19:18.240 come to a page and then you filter what you're 0:19:18.440 --> 0:19:20.800 interested in. I think that's going to really change. 0:19:21.119 --> 0:19:23.040 So you're going to be pushed people because they can 0:19:23.160 --> 0:19:25.760 the AI can already understand you exactly. 0:19:25.359 --> 0:19:27.040 Even from activity that you do on the app, or 0:19:27.080 --> 0:19:29.480 even activity from the outside the app. Right, Like, there's 0:19:29.480 --> 0:19:31.680 so much information your text messages about who you are, 0:19:31.760 --> 0:19:33.840 what you're into. What if there's a world where you 0:19:33.920 --> 0:19:35.719 uploaded a bunch of your text messages and we use 0:19:35.760 --> 0:19:38.120 that to understand who you are. I'm not necessarily saying 0:19:38.119 --> 0:19:39.680 we're going to do that, but those are the kinds 0:19:39.720 --> 0:19:42.160 of things I think that ay, I will allow companies 0:19:42.200 --> 0:19:44.359 like us to do and so we don't have a 0:19:44.520 --> 0:19:47.760 broad dating specific features are today. We have a lot 0:19:47.800 --> 0:19:51.240 of dating that happens on the app through conversations and chat, 0:19:51.320 --> 0:19:53.960 but not in terms of like features for dating specifically. 0:19:53.960 --> 0:19:55.880 And so as we build that out, I think there's 0:19:55.880 --> 0:19:58.200