Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. Bloomberg Tech is a
Speaker 1: live from coast to coast with Caroline Hide in New
Speaker 1: York and Eva Low in San Francisco.
Speaker 2: This is Bloomberg Tech coming up. Can Apple be the
Speaker 2: AI comeback kid? Details on the company's push into robots
Speaker 2: and a lifelike Siri.
Speaker 3: Plus, we talked to the Cisco CEO, Chuck Robins, fresh
Speaker 3: off earnings, the company seeing AI sales pick up but
Speaker 3: remains cautious on its outlook.
Speaker 2: Perhaps and Bitcoin retreats from record highs are reminder to
Speaker 2: investors that the ditital asset remains a volatile.
Speaker 3: One and it's AI that that is story for Apple
Speaker 3: because as tech giants are really trying to plot their
Speaker 3: AI focus, it's plotting it's comeback. The efforts centers on robotics,
Speaker 3: on lifelike syriad as you said, and home security. Yesterday,
Speaker 3: some two percent as investors bet this move could really
Speaker 3: help Apple and get its mojo back. Let's go to
Speaker 3: Mark German, who breaks the story yesterday on the future
Speaker 3: of AI. Today, we're going into blood Oxygen readings as well,
Speaker 3: but start with the AI focus.
Speaker 4: What can we expect?
Speaker 5: You know, Apple is a hardware company, right, all these
Speaker 5: companies Chat, GPT, Google, Gemini, Microsoft, they have all these
Speaker 5: AI features, but from a consumer standpoint, it really hasn't
Speaker 5: been monetized. How does Apple monetize its products well by
Speaker 5: selling hardware, getting people to go to Apple stores and
Speaker 5: buy new stuff every year or two. And so they're
Speaker 5: going to replay that strategy when it comes to artificial intelligence,
Speaker 5: and the way they see AI is by integrating it
Speaker 5: and creating devices around the smart home, home cameras and robotics.
Speaker 5: So the company is working on several items that are
Speaker 5: reported yesterday. The centerpiece of the strategy is a tabletop robot.
Speaker 5: This is essentially a virtual companion that you would have
Speaker 5: in your bedroom on your nightstand, you could have in
Speaker 5: your office on your desk, can have on a kitchen counter.
Speaker 5: It uses a robotic arm to move around in space.
Speaker 6: It's like an.
Speaker 5: iPad that can move through thin air on that robotic limb.
Speaker 5: He could help you get things done through your day.
Speaker 5: You can hold conversations with it. If you're having a
Speaker 5: conversation with another human being, it can even interject and
Speaker 5: jump in as if it's a third person in the room.
Speaker 6: You can consume video on it.
Speaker 7: It has FaceTime.
Speaker 5: There's also a smart home POB basically a home pod
Speaker 5: with a screen coming out next spring. This is going
Speaker 5: to have similar functionality to that device, without the conversational
Speaker 5: abilities and without the robotic arm. And they're developing a
Speaker 5: suite of home security in home automation products designed to
Speaker 5: rival what Amazon has been doing with a ring and
Speaker 5: Blink and what Google has been doing with Nest and
Speaker 5: other companies of course in the space include ADT and Roku.
Speaker 7: There is a software component, and that is Siri.
Speaker 2: You write about a lifelike Siri, sources describe it to
Speaker 2: you park.
Speaker 5: Well, the lifelike Siri is the ability to hold conversations,
Speaker 5: help you get things done, interject into conversations with other
Speaker 5: human beings as if it's another person in the room,
Speaker 5: very similar to what you're seeing on voice mode from Chat,
Speaker 5: GPT and from Gemini and some of these other LM
Speaker 5: based assistants. There's also a revamp next year to Siri
Speaker 5: on the iPhone, the iPad and the Mac that's coming.
Speaker 5: It's an underlying infrastructural change, but there's also a redesign,
Speaker 5: like a visual redesign to Siri coming as well to
Speaker 5: the iPhone and iPad on the home devices. Specifically, they're
Speaker 5: going to be creating a visual personality for Siri. Obviously Siri,
Speaker 5: obviously you heard it and you spoke to it. Now
Speaker 5: you're going to be able to see it too. If
Speaker 5: you remember Microsoft Clippy's Clippy from the nineties and the
Speaker 5: early two thousands in Microsoft Suite of Office apps, including Word,
Speaker 5: something similar to that. It floats around your display. You
Speaker 5: can interact with it at any time. They're actually trying
Speaker 5: to create a virtual character, either based on a memoji
Speaker 5: or the finder icon that's the filesystem logo that Apple's
Speaker 5: used for years on the Mac.
Speaker 3: Very briefly mark the Blood Oxygen the workaround versus Messimo's
Speaker 3: fight on Apple.
Speaker 4: Is it going to make much of an effect in
Speaker 4: the long term?
Speaker 5: You know, it's interesting because this workaround is, like you said,
Speaker 5: a real workaround. You're not going to have the blood
Speaker 5: Oxygen app like you had before on the Apple Watch. Instead,
Speaker 5: the sensors will be used and that will allow you
Speaker 5: to read that data on the phone itself through the
Speaker 5: health app.
Speaker 6: So it took them two years.
Speaker 5: The US Customs Agency finally allowed them to do this
Speaker 5: workaround and it comes at a pretty opportune time. In
Speaker 5: a few weeks they'll be announcing the next Apple watches,
Speaker 5: and now they'll be able.
Speaker 6: To market in the US. Blood oxygen saturation tracking is
Speaker 6: part of that.
Speaker 2: Bloomberg's Mark Guerman, who leads our coverage of consumer electrolics
Speaker 2: and broke detail on what happens next on Apple for
Speaker 2: more and what Apple's doing than I's web Bush joins us.
Speaker 6: Look.
Speaker 2: Mark's reporting moves the needle right. We know that this
Speaker 2: tabletop robot will be the centerpiece on the hardware side.
Speaker 2: We know that Siri will be made more lifelike. Has
Speaker 2: this changed things for you, Dan in what you're modeling
Speaker 2: for Apple? And to kind of comeback that many think
Speaker 2: that Apple needs to have in the AI domain, Look.
Speaker 8: In their AI strategy has been a disaster, and you
Speaker 8: know it's if you look at every other big tech company,
Speaker 8: you know Apple is massively behind. And I think when
Speaker 8: you look at this as a potential opportunity, I think
Speaker 8: Street is basically shrugged the shoulders. I mean robotics, Apple's
Speaker 8: going to come out in another device. Look look it
Speaker 8: up in AI Bok, a Microsoft book and meta. I
Speaker 8: mean it speaks to our view right now, it's an
Speaker 8: F one race and Manza. It's all passing thereby an
Speaker 8: Apple and cooker watch from a park bench drinking a cappuccino.
Speaker 2: That's actually a really interesting I think maybe veiled dan
Speaker 2: reference to WWDC, which opened up with the F one sequence.
Speaker 2: If you remember, then that puts the emphasis back on Siri.
Speaker 2: What how much better does Siri need to be then?
Speaker 2: If it is to be a tool use daily by
Speaker 2: technology users around the world in the same way that
Speaker 2: chat GPT is an Apple on my iPhone?
Speaker 6: Look, what's just call it? It is like Siri.
Speaker 8: Nothing's going to happen internally, I mean internally, this has
Speaker 8: been a disaster. Right If you go back to WWDC,
Speaker 8: it felt like Michael J. Fox back to the future
Speaker 8: moment in twenty sixteen. They continue to promise what's on
Speaker 8: the come, what's next? They're going to have to do
Speaker 8: an acquisition. I mean, look, it's just it's the reality
Speaker 8: of the situation. It's not happening internally, and there's no
Speaker 8: one on the street that believes any innovation is coming
Speaker 8: out of Apple when it comes to AI organically.
Speaker 3: Dan, you still got an outperform and a two and
Speaker 3: seventy dollars price target on Apple.
Speaker 4: You're sounding way more.
Speaker 3: Cautious than your money perspective is leading us.
Speaker 8: Yeah, look to get to two seventies. No, AI, this
Speaker 8: is a stock that's going to move higher. And even
Speaker 8: saw what happened last week with the tariffs, Cook obviously
Speaker 8: playing nice in the sandbox with Trump, that was a
Speaker 8: huge relief and the stocks had to move. And I
Speaker 8: think there's a stock that could go to two seventy
Speaker 8: or potentially two eighty without AI. But for this to
Speaker 8: be a three point fifty four hundred, four hundred and
Speaker 8: fifty dollars stock, it's AI and it's not happening internally.
Speaker 8: And I think that's the problem that the street has
Speaker 8: is that things like robotics next Gen or three thousand
Speaker 8: dollars buys to four thousand dollars. It's all about software
Speaker 8: and it comes down to like they need two essentially,
Speaker 8: and we've talked about perplexity. Other acquisitions are going to
Speaker 8: have to do. It's not happening internally. That's just the reality.
Speaker 3: What's interesting, Dan is the notes you have been putting out,
Speaker 3: for example today, have been more around. As you just said,
Speaker 3: there was a relief when Tim Cook was alongside President
Speaker 3: Trump last week. Well, this week it's all been about
Speaker 3: what President Trump has meant for in video of AMD
Speaker 3: and for paying to play. What do you make of
Speaker 3: the moves that we've seen and to gain access in China.
Speaker 8: Look, it speaks to I mean, you know a godfather quote, right,
Speaker 8: I mean it's a deal you can't refuse. And I
Speaker 8: think the reality is is that big tech CEOs are
Speaker 8: learning the new rules.
Speaker 6: Of the game.
Speaker 8: Now, of course it's wed godfather of AI, Jensen and video.
Speaker 8: They need to do with fifteen percent, it's breadcrumbs relative
Speaker 8: to getting into a China market. They can't give this
Speaker 8: the fall in a silver platter, and I viewed as
Speaker 8: bullish and it's going to put more fuel in the
Speaker 8: engine of this AI round.
Speaker 7: Dan super quickly.
Speaker 2: We broke the story last week that Dojo is no
Speaker 2: more at Tesla, and Musk has come out on x
Speaker 2: ray and kind of explained it the focus on AI
Speaker 2: five and a six.
Speaker 7: But how did you react to that. I don't think
Speaker 7: I saw a note.
Speaker 2: And what do you think about the stop gap between
Speaker 2: those generations of customs silicon?
Speaker 8: Yeah, that that's a great story that you guys, Broke,
Speaker 8: I mean I view it as this is to me,
Speaker 8: it's more certainty that Xai. They're going to have a
Speaker 8: massive investment XAI. That'll come at the shareholder meeting, but
Speaker 8: it speaks to our view. It's why Tesla stocklifting. I
Speaker 8: think more and more recognizing this is going to be
Speaker 8: a holistic strategy Tesla Xai.
Speaker 6: It's all about autonomous and robotics.
Speaker 8: And I think that was a view you kind of
Speaker 8: read through the tea leaves that that was my view.
Speaker 4: That nice web Bush. Great to catch up with you.
Speaker 4: Thank you.
Speaker 3: Meanwhile, coming up, ciscosio Chuck Robbins joining us to discuss
Speaker 3: the company's earnings, the state of AI infrastructure demand.
Speaker 4: This is Bloomberg Tech.
Speaker 2: So Cisco shares it down about one point two one
Speaker 2: point three percent. They've made an effort earlier in the
Speaker 2: session to kind of bounce back. We got this full
Speaker 2: year revenue outlook for fiscal twenty six. Some analysts felt
Speaker 2: it was a little cautious, but we're seeing AI infrastructure
Speaker 2: orders pick up. Delighted to say that we're joined now
Speaker 2: by Cisco CEO Chuck Robins, and actually, Chuck, I'm going
Speaker 2: to ask you something that I felt like the analyst
Speaker 2: community didn't really get to, and that is that there
Speaker 2: is this big products refresh happening mere term overcoming years.
Speaker 2: And I feel like you've been trying to talk about
Speaker 2: Cisco as a platform offering for a while and if
Speaker 2: we look at that fiscal twenty six outlook is that
Speaker 2: baked into that where Cisco is a platform offering and
Speaker 2: you folded security into it. That's kind of what I
Speaker 2: think people want to know.
Speaker 9: Yes, well, first of all, thanks for having me, and
Speaker 9: I do I want to thank the team and all
Speaker 9: of the Cisco folks for just a great year. We
Speaker 9: obviously had good order growth in Q four we had
Speaker 9: the great performance in the AI infrastructure order. We actually
Speaker 9: reported that we had taken down a approximately a billion
Speaker 9: dollars of revenue from those orders, which was something that
Speaker 9: everybody wanted to talk about. We talked through how we
Speaker 9: filled the progress kicking in on security, and then to
Speaker 9: your point, this product refresh cycle that we are beginning
Speaker 9: will happen over years, and honestly, we just turned on orderability.
Speaker 9: Large customers take a lot of time to evaluate put
Speaker 9: these things in labs before they.
Speaker 6: Put it in their critical infrastructure.
Speaker 9: But the points you make about the platform is really
Speaker 9: important because as we get into agentic AI, with the
Speaker 9: low latency constant communication that's going to occur, we're going
Speaker 9: to have to do security in the network.
Speaker 6: There is no other alternative.
Speaker 9: You cannot introduce latency by sending it to a security appliance,
Speaker 9: and we are the only company that has both networking
Speaker 9: and security technology to fuse it together to create that
Speaker 9: platform effect that you're describing.
Speaker 2: AI is a double edged sword, Chuck, It's margin dilutive.
Speaker 2: How do you think about that?
Speaker 9: Well, I think we have always had a portfolio of
Speaker 9: products that had various margin profiles. I mean, we had
Speaker 9: a point in our history where the Tolco and the
Speaker 9: service provider world was as much as thirty five thirty
Speaker 9: six percent of our business, and that was a different
Speaker 9: margin profile than the enterprise and so we just manage
Speaker 9: it the same way we have all along.
Speaker 6: So I'm not too worried about that.
Speaker 3: Meanwhile, Chuck, that massive opportunity ahead that you articulate with
Speaker 3: AI infrastructure, that bringing in of two billion of orders,
Speaker 3: the billion dollars of revenue already. Is it the platform
Speaker 3: offering that helps you push out and fend against some
Speaker 3: of the other competitors that want in on that.
Speaker 4: Of course HPE is trying to get in. You've got
Speaker 4: broad Com. Is that how you set yourself apart?
Speaker 9: Well, I think the key to remember with this is
Speaker 9: that it's networking systems and it's optics. That's primarily what
Speaker 9: we're selling for AI infrastructure, and there's really only three
Speaker 9: companies on the planet that can deliver the networking silicon
Speaker 9: that these customers require, and we're one of them. And so,
Speaker 9: you know, they're looking for low power requirements, they're looking
Speaker 9: for meeting their dates, they're looking for speed, bandwidth deployment,
Speaker 9: you know, and we're hitting that right now with them.
Speaker 9: And we've really built great relationships. If you if you
Speaker 9: go back five or six years ago, I had to
Speaker 9: try to convince people that we were rebuilding relationships here.
Speaker 9: And even if you go back fifty twelve fourteen months
Speaker 9: ago when we gave them the target of one billion
Speaker 9: dollars in orders, I think there were a lot of
Speaker 9: skeptics and the team actually delivered really well and we
Speaker 9: have great relationships with these customers.
Speaker 3: Now we are joined by Chuck Robins, Cisco CEO, and
Speaker 3: you know, you beat your things that previously others were
Speaker 3: cynical of, but the market moves with you. Many wanted
Speaker 3: even more in terms of your full year revenue guidance.
Speaker 3: Some are even going as far as to say that
Speaker 3: maybe you're suggesting a little bit of a cautious it
Speaker 3: spend for the next fiscal year.
Speaker 7: Do you abide by that, Chuck, No, we don't see that.
Speaker 9: We see we haven't seen any sort of slowdown at all.
Speaker 9: The only place we've seen that challenge, as has been reported,
Speaker 9: in US Federal our product order growth was seven percent.
Speaker 9: If you take out US Federal, we grew ten percent.
Speaker 9: And if you think about security, same thing. If we
Speaker 9: take out a US federal we grew double digits and
Speaker 9: security on orders. And I also talked about the fact
Speaker 9: that if we look at the fiscal year that we
Speaker 9: just entered, our US Federal team is actually forecasting a
Speaker 9: return to growth, so hopefully that won't be a head
Speaker 9: win in the next year. So we haven't seen anything meaningful,
Speaker 9: but we're also cognizant that we were operating in a
Speaker 9: pretty complex and dynamic environment.
Speaker 7: Chuck.
Speaker 2: We love to talk about the big projects on Bloomberg Tech,
Speaker 2: the big data center projects. Are there any specific examples
Speaker 2: of projects you're involved in that do you think are
Speaker 2: really needle moving for Cisco?
Speaker 9: Well, all the cloud providers are needle moving, and over
Speaker 9: time the neo cloud segment as well as the sovereign
Speaker 9: clouds we think are going to will be a big
Speaker 9: part of our business. Also we're just getting started in those.
Speaker 9: If I hit on a few of those. The sovereign
Speaker 9: AI data centers that we talked about in UAE as
Speaker 9: well as in Saudi are the early ones. We're having
Speaker 9: discussions in other Asian countries, in Africa, in Europe, you
Speaker 9: have this push for on prem sovereign applications, So from
Speaker 9: geopolitical perspective and a risk perspective, they want more control
Speaker 9: over the tech stack that they have in their countries.
Speaker 9: So that's more of a sovereign play, and we're one
Speaker 9: of the unique companies who can actually deliver say Splunk
Speaker 9: on prem or they're asking for WebEx on prem, which
Speaker 9: we can do so. And then the neo clouds we
Speaker 9: could talk about as well, but that's another emerging opportunity
Speaker 9: for US.
Speaker 2: I don't think many appreciate the scale of Cisco. Sometimes
Speaker 2: you've got a lot of credit by the way, on
Speaker 2: this program at least about how you've communicated tariff's impact.
Speaker 2: But you're basically one of the biggest and leading network
Speaker 2: chip producers globally, and this is an administration that wants
Speaker 2: more US manufacturing. So you have the volume of gear,
Speaker 2: you design your own chips, TSMC makes them for you.
Speaker 2: The economics kind of works in your favor. Have you
Speaker 2: made some commitment to do what this administration is trying
Speaker 2: to do, which is take that process that you've mastered,
Speaker 2: but just bring it to the States in some form.
Speaker 9: Well, I think that much like you know, Nvidia, AMDUS others,
Speaker 9: there are a lot of companies that actually rely on
Speaker 9: TSMC the for the fabrication of the silicon, and they've
Speaker 9: obviously made commitments on their side to actually build out
Speaker 9: capacity in the United States, and so we're happy to
Speaker 9: see that happening. The thing that people don't really realize
Speaker 9: is that we've maintained a US manufacturing footprint all along,
Speaker 9: and so we have a footprint in the US today
Speaker 9: that we can look at expanding. But I think it's
Speaker 9: just important for us right now to wait and see
Speaker 9: exactly where all this stuff lands. If you go back
Speaker 9: to twenty eighteen when the China tariffs hit. Our teams
Speaker 9: have made moves and mitigated roughly eighty percent or so
Speaker 9: of those, and so we just continue to look at
Speaker 9: these things as they come out, figure out what the
Speaker 9: best plan of action is, and then we act.
Speaker 3: When you think about planning ahead a business continuity, Chuck,
Speaker 3: when you see what's happened with MD and Video and
Speaker 3: the deal they've cut to access China, when you think
Speaker 3: about exporting more broadly, you're thinking that might come your
Speaker 3: way of pay to play in the future.
Speaker 6: I have no idea.
Speaker 9: We wake up every day and we try to figure
Speaker 9: out what's transpired and what's happening in the world, and
Speaker 9: how do we react to it. I've talked about over
Speaker 9: time that the current crop of CEOs in the United
Speaker 9: States have basically been operating in times of uncertainty or
Speaker 9: crisis or certainly very dynamic environments, and so we're all
Speaker 9: used to just dealing with whatever changes are coming our way.
Speaker 9: You know, there's the old saying that you can deal
Speaker 9: with the world as it is or how you'd like
Speaker 9: it to be, and just we just wake up and
Speaker 9: we deal with what comes at us and try to
Speaker 9: plan a accordingly, try to do scenario planning, but then
Speaker 9: deal with.
Speaker 6: It as it is.
Speaker 3: And when you're controlling your own destiny. You've been doing
Speaker 3: a bit of M and A and you mentioned the
Speaker 3: Sprung coffering and how that helps you access the likes
Speaker 3: of view Up for example. Anymore M and A on
Speaker 3: the rise in particularly when it comes to AI.
Speaker 9: We're always looking Our strategy hasn't changed. Obviously, valuations are
Speaker 9: quite frothy in that space. But if there's something that
Speaker 9: helps us advance our strategy more effectively, then we're always
Speaker 9: willing to take a look at it. I would say
Speaker 9: that M and A is not the strategy. We have
Speaker 9: our product strategy and our solution strategy for our customers,
Speaker 9: and if there's an acquisition that helps us accelerate that,
Speaker 9: then that's what we're really interested in. And you think
Speaker 9: about places like AI, infrastructure or security or observability.
Speaker 6: In those kind of areas, they're always interesting to us.
Speaker 2: Chuck, how's the relationship with Nvidia evolving since it was
Speaker 2: all announced?
Speaker 6: It's great.
Speaker 9: Our team and their team's execs had dinner last night
Speaker 9: and we're working on architectures for Neocloud architectures for the enterprise.
Speaker 9: We're working on go to market, joint go to market together.
Speaker 9: So I'd say it just continues to get stronger. And
Speaker 9: we're really on the front end now of a lot
Speaker 9: of the technology integrations that we've been working on, and
Speaker 9: we're on the front end of the real enterprise wave
Speaker 9: of this AI. If you think about it, it started
Speaker 9: in the back end networks of the cloud providers.
Speaker 6: It's moving.
Speaker 9: It's obviously going to have an impact on the front
Speaker 9: end networks, it's going to have an impact on the
Speaker 9: enterprise and even the telco business that we saw this quarter.
Speaker 9: We had telco and cable. Our orders were up greater
Speaker 9: than twenty percent, and a lot of that was attributed
Speaker 9: to their preparation for AI.
Speaker 3: Chuck Robins, Cisco CEO and Fantastic speak with you today,
Speaker 3: Time Now for Talking Tech and First Up and Video
Speaker 3: partner on HI. But it's expecting sales of its servers
Speaker 3: to more than double this quarter. The company sees one
Speaker 3: hundred seventy percent rise in revenue just from its AI service,
Speaker 3: but executives are warning look that consumer electronics business could
Speaker 3: shrink this year as it faces potential US tariffs plus
Speaker 3: Oracle is coming back. Jobs in its cloud unit are
Speaker 3: coming in the latest company to take steps to control
Speaker 3: costs amid heavy spending on AI infrastructure. Now, according to sources,
Speaker 3: more than one hundred and fifty jobs work cut in
Speaker 3: the Seattle area, which traditionally the unit's hub. Oracle said
Speaker 3: last year it was moving its headquarters to Nashville, and
Speaker 3: the company currently has more jobs listed in Tennessee and
Speaker 3: any other stake And Airbnb will.
Speaker 4: Now allow guests to.
Speaker 3: Reserve some US trips without paying up front, and a
Speaker 3: feature is.
Speaker 4: Called reserve now, Pay later.
Speaker 3: It lets use this book in advance without the need
Speaker 3: to pay the full amount till eight days before the
Speaker 3: end of the listening's cancelation period. Now, the move comes
Speaker 3: after the company of horse worn last week of moderate
Speaker 3: gains through the remainder of the year.
Speaker 2: And if we got okay coming up prices a Bitcoin
Speaker 2: and ether down following stronger than anticipated inflation. But crypto
Speaker 2: and crypto related companies, it's been on a bit of
Speaker 2: a tear recently to talk about what is going on
Speaker 2: in the crypto market. Next, let's think about some of
Speaker 2: the names you've been looking at. Apple had a really
Speaker 2: strong day yesterday, a little softer today, nine percent.
Speaker 7: Cisco.
Speaker 2: We've just had that conversation with Chuck Robbins and the
Speaker 2: market will digest his outlook. Core weaves down eleven percent.
Speaker 2: It fell twenty one percent yesterday. Is basically the cost
Speaker 2: of its build out in its scaling is spooking investors.
Speaker 2: Check out our interview from yesterday. It was a big one.
Speaker 2: This is Bloomberg Tech. Welcome back to Bloomberg Tech. I'm
Speaker 2: looking at the crypto frankly and also sort of the
Speaker 2: industry at large. It's been like a very heavy news
Speaker 2: flow twenty four hours. If you take about bitcoin and
Speaker 2: ether in particular, we were pushing fresh record highs. Largely
Speaker 2: is like this appetite for risk assets. But then we
Speaker 2: got this PPI print or wholesale inflation print that that
Speaker 2: was high and there was a little jitter. And it's
Speaker 2: not just stocks. You see that in the specific digital
Speaker 2: currencies as well. Bullish in its second day of trading
Speaker 2: up another nine percent after an astonishing day yesterday. We
Speaker 2: just throw that in there, given you know, it's sort
Speaker 2: of an adjacent crypto platform, but that would indicate that
Speaker 2: in that single name, at least Caroline there's still a
Speaker 2: lot of bullish sentiment out there. I can't believe I
Speaker 2: did that gross.
Speaker 3: Let's move on, will excuse you and pardon you the pun.
Speaker 3: Let's stick with a crypto market and bullish sentiment across
Speaker 3: the world. Cavitagupta is with us, founder and general partner
Speaker 3: of Delta Blockchain Fund. It's a venture firm focusing on
Speaker 3: early stage blockchain innovation and computer to that end, is
Speaker 3: it helpful or not that there is a lot of
Speaker 3: risk on attitude in the market that is pushing us
Speaker 3: into new IPOs, into the cryptosphere when also it is
Speaker 3: dictated by macro perspective and where interest rates are going.
Speaker 4: Is it helpful for the formation of new businesses right
Speaker 4: now or one hundred percent?
Speaker 10: But what's happening with digital asset treasures in the market
Speaker 10: like five hundred million dollar new digital asset TRUSS three,
Speaker 10: five hundred million dollar for hyper liquids for also assets
Speaker 10: which are not luted coming into the market directly at
Speaker 10: NASDAK now listed having access is creating a very interesting
Speaker 10: by pressure for the first time in.
Speaker 4: The history EAT.
Speaker 10: Actually we have a shortage of EAT available in the
Speaker 10: market to buy because we have over four billion dollar
Speaker 10: treasuries coming into the market to buy eat. That's it,
Speaker 10: and so we are seeing a lot of changes.
Speaker 3: Let's move into that because this is the micro strategy
Speaker 3: or now strategy strategy of basically being able to hold
Speaker 3: bitcoin initially, now moving to eat Salana other assets on
Speaker 3: basically your balance sheet using it as a treasury. It's
Speaker 3: starting to trickle down into slightly more riskier asset paths.
Speaker 3: I mean, just look at what listed yesterday or five
Speaker 3: on the NASTAC. They've done a spac where we're seeing
Speaker 3: now they're going to be buying up World's Liberty coin,
Speaker 3: yes one that you can't trade freely anyway as a crypto,
Speaker 3: and now they're having a publicly traded entity that's going
Speaker 3: to be there eventually to buy up a.
Speaker 4: Load of that asset.
Speaker 3: It's got, you know, the Trump's involved, the wickoffs involved.
Speaker 4: Is it good to see that happen in your ecosystem?
Speaker 10: I think it's good and bad at the same time.
Speaker 10: The good is that there is an appetite. There are
Speaker 10: people who are pumping in a billion dollars into entities
Speaker 10: like this, right, so there is definitely a demand for it,
Speaker 10: which is really good for the crypto market. The downside
Speaker 10: is where does the buck stop?
Speaker 4: Right?
Speaker 10: And so we are now seeing assets which don't even
Speaker 10: have a billion dollar FTV in the market coming in
Speaker 10: and raising three hundred million, four hundred millions and completely
Speaker 10: going crazy, and not only.
Speaker 4: In US and reads how investory they're raising.
Speaker 10: A bunch of them are crypto investors, like most of
Speaker 10: the crypto funds, including ours, are now doing a lot
Speaker 10: of digital asset tressrees. But apart from that also a
Speaker 10: lot of retail investors and institution investors who do not
Speaker 10: have access still because there is no ATF of Salana,
Speaker 10: there is no ETF of Souis, so where do they
Speaker 10: get access to these? And that does raise a question, Hey,
Speaker 10: is it another pump and dump on the Wall Street
Speaker 10: from crypto market to now Wall Street? And who is
Speaker 10: really going to have a real exit liquidity here? It's
Speaker 10: still going to be the insider circle or outsider or
Speaker 10: is it the new landscape for it at least for
Speaker 10: next two and a half three years till we have
Speaker 10: the Trump government.
Speaker 2: KIVIDA, you invest at the earliest stage, at the bottom
Speaker 2: of the curve, those founded on the technological underpinning of everything.
Speaker 7: We're talking about.
Speaker 2: But I see robin Hood and Stripe and the bigger
Speaker 2: FinTechs and the banks looking at stable coin in particular
Speaker 2: wanting to do their own thing. How disrupted is that
Speaker 2: to you? You know, if you at that scale that
Speaker 2: activity is happening and you have all of your portfolio
Speaker 2: companies doing something at a different scale.
Speaker 10: Yeah, it's very fascinating. Thanks it for that question, because
Speaker 10: now we are completely as an early stage investment fund.
Speaker 10: We are going into a space where we have demand
Speaker 10: for so many acquisitions of our companies and so many
Speaker 10: brain powermand Like some of the top banking CEOs, which
Speaker 10: four years back would not even give me a day,
Speaker 10: give me a second in their schedule, are now hosting
Speaker 10: us for dinners trying to understand how are these cross
Speaker 10: chain stable coins gonna settle, How are the money markets
Speaker 10: and reposts and all these eels are gonna happen, And
Speaker 10: everybody wants to do their own stable coin settlement platform
Speaker 10: and want to issue.
Speaker 4: Their own stable coin. I have a feeling in next.
Speaker 10: Year and a half, not only Circle, We're gonna have
Speaker 10: like twenty IPOs of some of the top companies, try Probinhood.
Speaker 10: I'm pretty sure Square is gonna come on the block
Speaker 10: for that Facebook and Instagram will have their own stable coin.
Speaker 10: It's only going to be about who's going to have
Speaker 10: a distribution and everybody's gonna have their stable cooin blockchain platform.
Speaker 3: Now, okay, more Proaly, if everyone's getting into the spaces
Speaker 3: stable coins, if we're seeing companies being developed more and
Speaker 3: more activity in the space, how do you protect any
Speaker 3: downside here? Or is it just doing your due diliges
Speaker 3: and showing that you understand how tradable the asset is
Speaker 3: that you're getting into. And indeed the future of actually
Speaker 3: the digital asset is. From a project perspective, I.
Speaker 10: Think the fundamental of investing in digital assets will always
Speaker 10: remain the same technology.
Speaker 4: Is it scalable?
Speaker 10: Of course, now we have a new Now we have
Speaker 10: a new exit place acquisitions by some of the top companies.
Speaker 10: So is it an institutional adoption product? Can the founders
Speaker 10: take it to let's say a top bank and say, hey,
Speaker 10: we can settle all your repos on this. But the
Speaker 10: other part of this is if I just look at
Speaker 10: the liquid fund, which is doing way better than a
Speaker 10: lot of early stage investment in the technology platform just
Speaker 10: because where the market is today, I'm realizing that digital
Speaker 10: assets restrend is not done yet. It's going to go,
Speaker 10: and it's still not there at the peak because more
Speaker 10: and more people in Hong Kong market, UK market, a
Speaker 10: lot of smaller European and Asian markets are now suddenly
Speaker 10: waking up to it, and that's the demand we are getting.
Speaker 10: Anything under billion dollar FTV is now going into those
Speaker 10: Asian markets and completely raising another layer of investments, and
Speaker 10: that excites me, bothers me and makes me very curious.
Speaker 7: At the same time, tov to go to.
Speaker 2: A general partner at Delta Blockchain Fund. It's great to
Speaker 2: have you back on the show. Thank you very much.
Speaker 2: Now coming up, parag Agrowole, the former CEO of Twitter
Speaker 2: who's squared off against Elon Musk.
Speaker 7: Well he's back.
Speaker 2: He's got a new AI startup and he's going to
Speaker 2: join us to talk about that experience and what he's
Speaker 2: doing now. This is Bloomberg Tech, the former CEO of
Speaker 2: what was then known as Twitter. Parag Agrowole has moved
Speaker 2: on from his days sparring with Elon Musk and he
Speaker 2: stepped into the world of AI startups. Agrowyle's new company,
Speaker 2: Parallel Web Systems is building a tool to help AI
Speaker 2: agents navigate the web.
Speaker 7: Parag Agroyle joins us.
Speaker 2: Now, it's good to see you back in the world
Speaker 2: of technology, at least publicly, back in the world of technology.
Speaker 2: You know, I was reading about parallel web systems, the
Speaker 2: idea that the customer is the AI agent, and it's
Speaker 2: just a place to start. Tell us about this startup,
Speaker 2: what you're doing, why you're doing it.
Speaker 11: Hey, Ed, First of all, thank you so much for
Speaker 11: having me after leaving Twitter. One of the things I
Speaker 11: was doing was this writing a bunch of code, tinkering around.
Speaker 11: I was actually building AI agents a couple of years
Speaker 11: ago that were mostly collecting information from the web, bringing
Speaker 11: it back to me so that I could create it.
Speaker 11: And I had a couple of realizations doing so. One
Speaker 11: that the AI agents are going to be the primary
Speaker 11: customer of the web going forward. They will use the
Speaker 11: web a lot more than humans ever have. And two,
Speaker 11: the web that exists isn't built for them. It's not
Speaker 11: ready for them. Everything I and so many people have
Speaker 11: built over the last thirty years has been built for
Speaker 11: humans and for eis. Their needs are different, and that's
Speaker 11: the problem that we're starting at Parallel, and.
Speaker 6: That's why we describe EI.
Speaker 11: Agents as a primary customer for all the technology that
Speaker 11: we're building.
Speaker 2: There is actually some news that we're breaking here right
Speaker 2: which is that you've raised around thirty million dollars for Parallel.
Speaker 2: You know, that's a lot out the gate. Just tell
Speaker 2: us about about how that went, that came about and
Speaker 2: the team that you've built.
Speaker 11: We when we've started with this vision or visions like
Speaker 11: a big vision in order to really transform what the open.
Speaker 6: Web looks like.
Speaker 11: Doing so requires reimagining from the ground up every part
Speaker 11: of the infrastructure that spans the crawl, the index ranking systems,
Speaker 11: reasoning systems, completely new interfaces built for a systems. And
Speaker 11: as we sort of thought about what it would take
Speaker 11: to build all of this, I think that was the
Speaker 11: appropriate amount of money to raise. The team we have
Speaker 11: is also the one needed to take on this problem.
Speaker 11: The team around me is the team that built a
Speaker 11: lot of the key primitives of the current human web,
Speaker 11: whether it be at social networks like Twitter and Snap,
Speaker 11: or at scripe and even marketplaces at Airbnb and so
Speaker 11: the best people who've sort of built the previous version
Speaker 11: of the web, recognizing ways in which it does not
Speaker 11: serve the needs of what's coming. Yes, have now come
Speaker 11: together to build this future web aar We too.
Speaker 3: Had started off by saying the customer is the agent here,
Speaker 3: but who actually is the customer?
Speaker 4: And seeing the integration with.
Speaker 3: Lindy for example, with AI agents, but more broadly, who
Speaker 3: buys you? Whose problems you solving? Is it those of
Speaker 3: open AI and perplexity you are busy building the agentic platforms.
Speaker 11: I think one way to think about our customer set
Speaker 11: right if you think of any piece of software or
Speaker 11: any workflow, both of those are changing. They're changing by
Speaker 11: incoorporating models like lllms into them that give them intelligence. Now,
Speaker 11: once you have those, it almost feel silly to not
Speaker 11: have access to the open Web in order to serve
Speaker 11: your customers or do your Workflorce.
Speaker 6: Let me give you an example.
Speaker 11: We work with an insurance a large insurance company. One
Speaker 11: of the things they do is underwriting, wherein there's a
Speaker 11: bunch of people that spend thirty minutes, perhaps even two hours,
Speaker 11: understanding a business they're about to underwrite, to understand everything
Speaker 11: about it and discover all long tail risk signals anywhere
Speaker 11: on the web. Now they've been doing that with human
Speaker 11: operations forever. As we started working with them and they
Speaker 11: incorporated our APIs into how they do things, combining all
Speaker 11: of the data from the web with all of the
Speaker 11: internal proprietary information that they have collected, they're actually able
Speaker 11: to outperform humans meaningfully, not just in terms of cost
Speaker 11: and how you can do things, but in terms of quality,
Speaker 11: because it turns out humans cellucinate it too.
Speaker 3: Briefly, Parak, you built parallel web systems hot on the
Speaker 3: heels of a very combative few years having led Twitter,
Speaker 3: but you were known as building the machine learning systems
Speaker 3: over Twitter and now X.
Speaker 4: What lessons have you learned to bring to this new company.
Speaker 11: One, A lot of the lessons from the past no
Speaker 11: longer apply when you're thinking of building machine learning systems.
Speaker 11: When we're building those at Twitter at twenty fourteen, they
Speaker 11: look very very different from the systems we are now
Speaker 11: able to build, velocity at which we were able to move,
Speaker 11: and the kinds of problems we are able to take on.
Speaker 11: What remains similar, though, for people who've been doing machine
Speaker 11: learning for a while, is the mindset of solving problems
Speaker 11: end to end, understanding evils, dealing with stochastics, systems, and
Speaker 11: I think those are the lessons that truly inform us.
Speaker 2: Parrague, Sun Valley twenty twenty two. I was there, I
Speaker 2: remember seeing you there, and then everything that followed, just
Speaker 2: for the first time, reflects a little bit on what happened.
Speaker 7: In Yeah please.
Speaker 11: What happened was we built over eleven years that I
Speaker 11: was at Twitter, one of the most consequential platforms to exist.
Speaker 11: It allowed everyone to speak and hear directly from others,
Speaker 11: and there is nothing like it, and I'm very proud
Speaker 11: of what I was able to achieve there with my years. Now,
Speaker 11: of course there was a lot more to be done.
Speaker 11: It remains a platform that matters in the world.
Speaker 6: But my new mission pulls.
Speaker 11: A thread from that, which is how do you keep
Speaker 11: the web open. It's the same mission around allowing everyone
Speaker 11: to publish openly on the web, around every AI being
Speaker 11: able to access what everyone is publishing freely. There is
Speaker 11: a risk on the open web, wherein we might have
Speaker 11: a bunch of payballs and silos, and an AI model
Speaker 11: from one vendor is able to access certain parts of
Speaker 11: the web, while the agent you might run on your
Speaker 11: computer using open source software cannot And that's not the
Speaker 11: future I want and that's why we're building Parallel all.
Speaker 3: Raight Agrowell, thanks for joining us, found our CEO Parallel
Speaker 3: Web Systems and of course pre you to see the
Speaker 3: CEO of Twitter. Fitness ban maker Woop is refusing to
Speaker 3: disable it's blood pressure tracking tool following warnings from the
Speaker 3: FDA saying that the company is operating as a medical device.
Speaker 3: Joining us now to discuss CEO Will almed Will, what's
Speaker 3: your view that the FDA does not have authority in
Speaker 3: this moment. Your wellness not medical device.
Speaker 12: Well, thanks for having me on you know Whoop spent
Speaker 12: the last three years developing a very innovative feature called
Speaker 12: blood Pressure Insights, and this takes our wrist worn wearable
Speaker 12: alongside a calibration with a cuff and is allowed to
Speaker 12: provide you with a daily estimate of your blood pressure
Speaker 12: and in turn it also then gives you insights how
Speaker 12: your blood pressure may be affecting other things in your wellness.
Speaker 12: This could be sleep, stress, nutrition, a variety of different
Speaker 12: wellness factors, and the FDA has come forward saying that
Speaker 12: they believe that this should be regulated now. The twenty
Speaker 12: first Century Cures Act makes it very clear that wellness
Speaker 12: intended features are not supposed to be regulated by the FDA,
Speaker 12: and the FDA is intended to actually just regulate medical
Speaker 12: devices that are diagnosing something. So there's this key question
Speaker 12: of intended use. And you can see this with other
Speaker 12: physiological metrics like r A monitoring for example, where HORRY
Speaker 12: monitoring has wellness applications and medical applications.
Speaker 6: The wellness applications.
Speaker 12: Might be things like exercise or stress monitoring or sleep monitoring,
Speaker 12: and we do all that and then alternatively, there could be,
Speaker 12: you know, a diagnosis for a fib and that would
Speaker 12: be an example where.
Speaker 2: The fall will That's what the FDA is interpreted, right,
Speaker 2: But you're a smart guy and you employ lots of
Speaker 2: smart people, why not just go through the FDA process
Speaker 2: in the first place, kind of foreseeing that this might
Speaker 2: come up.
Speaker 12: Well, you have to understand there's different use cases, right.
Speaker 12: One use case for blood pressure is around wellness, and
Speaker 12: there's other use cases that might be a medical diagnosis.
Speaker 12: And we're certainly looking at you know, cleared products as
Speaker 12: well on a longer term horizon. But we're providing a
Speaker 12: lot of value today and following the law again the
Speaker 12: twenty first century Cures Act makes it very clear if
Speaker 12: a product is intended for a wellness use case, it's
Speaker 12: not supposed to be regulated by the FDA. So then
Speaker 12: the fundamental question becomes, does blood pressure have wellness intended
Speaker 12: use cases? We believe it does, right, There's an avalanche
Speaker 12: of pure reviewed research that shows that blood pressure, not
Speaker 12: surprisingly is influenced and influences other aspects of your wealth.
Speaker 4: Will why call it medical grade? Why market it that way?
Speaker 12: Well, we recently came out with the Whoop five DOTZHO
Speaker 12: and the Whoop MG, and a key distinguishing factor between
Speaker 12: the WOOP five dot OHO and the MG is that
Speaker 12: the MG has a medically cleared feature on it. Now,
Speaker 12: both of those products have a number of wellness features
Speaker 12: associated with it. The WOOP MG happens to have an
Speaker 12: ECG monitor as part of that that can detect aphib
Speaker 12: and by the way, we spent two and a half
Speaker 12: years working with the FDA to have that cleared feature.
Speaker 12: So that is the distinguishing factor between those two hardwares.
Speaker 12: And I want to be very clear in the app
Speaker 12: there's an enormous number of medical disclaimers explaining what is
Speaker 12: for wellness and what is for medical capabilities.
Speaker 2: Well, you've said this is a misunderstanding. What happens next?
Speaker 2: Will you continue to fight the FDA on it or
Speaker 2: in the background are you trying to reach some solution.
Speaker 6: We have a lot of respect for the FDA.
Speaker 12: I mean, we've engaged with them on a number of
Speaker 12: different features over the years. We think in this specific
Speaker 12: case they have it wrong, and so we're going to
Speaker 12: continue engaging.
Speaker 6: With them on it.
Speaker 12: We've responded to their warning letter outlining how we feel
Speaker 12: about this and why we think we're following the law,
Speaker 12: and we look forward to continuing to engage with them
Speaker 12: on it.
Speaker 3: Well, that must take up headspace and ultimately your time.
Speaker 3: How does that impact your future product roadmap? How does
Speaker 3: more broadly, the FDA acting this way affect innovation more broadly?
Speaker 4: Do you think ultimately?
Speaker 12: I think that you know, innovation needs to be able
Speaker 12: to thrive in the United States. Whoop is one of
Speaker 12: the first wearables in the world that can measure blood
Speaker 12: pressure accurately from the risk that's a really big deal,
Speaker 12: and it's also being accepted in fifty other markets around
Speaker 12: the world.
Speaker 6: So, you know, we want.
Speaker 12: To make sure that there's policies that are consistent here
Speaker 12: in the US that really allow companies to innovate and
Speaker 12: to operate. It's also worth noting, you know, we have
Speaker 12: a lot of people using this every single day, and
Speaker 12: overwhelmingly if you look at the feedback from our members,
Speaker 12: they absolutely love this feature and they talk about how
Speaker 12: accurate it is and how it's helping them understand their wellness.
Speaker 12: So we feel like we're on the right side of history,
Speaker 12: and we're going to continue educating the FDA on what
Speaker 12: we're doing.
Speaker 6: Well.
Speaker 2: I'm very quickly I'm not a Whoop user, but I'm
Speaker 2: very conscious that in the Premier League and other international
Speaker 2: football players, it's very in the public conscience. I just wonder, like,
Speaker 2: is this a good pr moment for you to fight
Speaker 2: America's regulator.
Speaker 6: I think in the long.
Speaker 12: Run we'll be on the right side of history, and
Speaker 12: that maybe in a very short period of time too.
Speaker 12: I think that fighting for innovation, fighting for Americans access
Speaker 12: to health data is the right thing to do. And
Speaker 12: I've spent thirteen years building this company. When I first started,
Speaker 12: the idea that you could measure sleep or heart rate
Speaker 12: accurately from the wrist seemed impossible, and now we're able
Speaker 12: to do blood pressure accurately from the risk. That's a
Speaker 12: really big deal and I think it should be celebrated
Speaker 12: as long as there's the right guidelines in place and
Speaker 12: the right education in place for members to understand how
Speaker 12: to use it. And that's what we've done with this feature,
Speaker 12: and that's why we're proud of it.
Speaker 7: Whip CEO Will Almed, Thank you very much, Caro.
Speaker 3: Ah great conversation to round out. What is the end
Speaker 3: of this edition of Bloomberg Tech Ed programming note, make
Speaker 3: sure to check out the next edition of Bloomberg Tech Europe.
Speaker 3: Tom McKenzie can be exploring how AI is changing the wing.
Speaker 3: We work six thirty am London time on Friday.
Speaker 2: And give and I have twenty seconds. I didn't expect.
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