Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is alive
Speaker 1: from coast to coast with Caroline Hide in New York
Speaker 1: and v Lovelow in San Francisco.
Speaker 2: This is Bloomberg Tech. Coming up. Tech helps stocks close
Speaker 2: in on record highs with Mag seven earnings.
Speaker 3: Plus Bridget Mendland Northwood and raises one hundred million dollars
Speaker 3: to modernize space infrastructure on Earth.
Speaker 2: And Amazon shuddering its physical stores but doubling down on
Speaker 2: deliveries Walmart, Uber and door Dash all drop.
Speaker 3: Let's check out more broad moves on the market right now.
Speaker 4: And because we have a wall of call it worry.
Speaker 3: Whether you're thinking about what the mag seven is going
Speaker 3: to report, whether you're thinking about the federal rate decision
Speaker 3: on Wednesday, a lot for the market time digest, but
Speaker 3: still were pushed to record highs the S and P
Speaker 3: five hundred. We have up nine ten percent on the
Speaker 3: Nasdaq one hundred, and I know you're checking on individual movers.
Speaker 3: They've been helping some moves in the benchmark.
Speaker 2: Yeah, an interesting deal up to six billion dollar partnership
Speaker 2: between Meta and Corning for fiber optic cabling to support
Speaker 2: Meada's data center efforts over a number of years. You
Speaker 2: know Corning, right, it's a key optics supplier to Apple,
Speaker 2: for example, But look at that stock absolutely flying up
Speaker 2: more than seventeen percent. There's a lot going on as
Speaker 2: well in the semiconductor space. Micron is long term trying
Speaker 2: to triage the shortage of supply, investing a lot of
Speaker 2: money up to twenty four billion dollars over years in
Speaker 2: Singapore that's focused on land and then overnight and career
Speaker 2: sk Heinex the biggest move of the upside. Basically, there's
Speaker 2: dip buying, there's retail investors coming in, and there's a
Speaker 2: lot of focus. What's happening in the context of a
Speaker 2: US career trade agreement agreement where there might be exemptions.
Speaker 2: Let's get to all of that. Bloomberg Senior Tech editor
Speaker 2: Mike Shephard joins us. Now, let's start with the Micron piece. Right,
Speaker 2: Like the story is well told if I say to
Speaker 2: myself on this program about the memory shortage and memory
Speaker 2: pricing situation. But Micron here is looking at where it
Speaker 2: can expand supply. It's looking at Singapore.
Speaker 5: What do we need to know, Well, it's looking at
Speaker 5: Singapore ed and this is over a ten year period
Speaker 5: and twenty four billion dollar investment there. And what they're
Speaker 5: looking at a specifically is so called nand memory, and
Speaker 5: this is something that is in demand to meet the
Speaker 5: needs of artificial intelligence chips and processors more broadly, and
Speaker 5: it's an area of focus because for AI, the memory
Speaker 5: needs are enormous and they are not fully being met.
Speaker 5: Of course, Micron competes with Samsung and s k Heinex
Speaker 5: in this memory market, and all three companies have warned
Speaker 5: of increasingly tight supplies. And this supply issue also has
Speaker 5: spillover effects. It It actually touches on smartphonemakers and PC
Speaker 5: makers too, because as those companies that we just mentioned
Speaker 5: shift their efforts to meet the needs of the AI
Speaker 5: data centers, the areas for PCs and smartphones risk going
Speaker 5: wanting in the SSD type memory and flash memory that
Speaker 5: is needed for those kinds of devices. So we're seeing
Speaker 5: that expansion by Micron. This just comes at less than
Speaker 5: two weeks after Micron cut the ribbon on a one
Speaker 5: hundred billion dollar plant in upstate New York one that's
Speaker 5: been a couple of years in coming. So we are
Speaker 5: watching to see how much more these companies are going
Speaker 5: to be investing not only in Asia but also in
Speaker 5: the US.
Speaker 3: As well, and how much more of our shares can fly.
Speaker 3: Just think sk Heinis at a new record high, even
Speaker 3: as we see the threat of well broader tariffs in
Speaker 3: South Korea. We know the chip makers are excluded, but
Speaker 3: sk Heinis in a record because it's going to be benefiting
Speaker 3: from Microsoft's push into AI chips as well.
Speaker 2: Mike, Well, that's right.
Speaker 5: And I'm glad you brought that up, Carol, because we
Speaker 5: saw the news yesterday. We all followed it so closely
Speaker 5: on this plan by Microsoft to introduce a new generation
Speaker 5: of its Maya AI chip. The Maya two hundred and
Speaker 5: local business paper in South Korea, the mainly business newspaper,
Speaker 5: is reporting that as many as six Skhinex HBM three
Speaker 5: E units will go into each Maya processor. We don't
Speaker 5: know how many of these Maya two hundred processors Microsoft
Speaker 5: will ultimately have produced for its needs for its data
Speaker 5: centers and for other customers as well, but the promise
Speaker 5: is big, and it signals that there could be a
Speaker 5: lot of demand for this HBM THREEE processor that sk
Speaker 5: Heinex has developed to meet those AI memory needs, and
Speaker 5: it could be something else. Now you mentioned the threat
Speaker 5: of additional tariffs. The President yesterday warned that the South
Speaker 5: Korea trade deal could be reworked to jack up the
Speaker 5: teriff freight on South Korean imports to twenty five percent.
Speaker 5: For now, we're not seeing anything effect memory, but we'll
Speaker 5: be watching that closely because there is a lot of
Speaker 5: pressure from the administration for more investment by South Korean
Speaker 5: companies here in the US.
Speaker 3: Mike Shepherd breaking it down so well as always, we
Speaker 3: thank you AT's return to us stox right now because
Speaker 3: if you said, the near record highs tech shares have
Speaker 3: been leading the way again as we brace for earning season,
Speaker 3: it comes thick and fast. At Weekles's discussed it all
Speaker 3: with Christina who for Chief Market Strategists and Man Group,
Speaker 3: and we still have tariff anxiety. You still have the
Speaker 3: warriors of what the Friend's going to do tomorrow, and
Speaker 3: yet we push higher. Is that the fundamental analysis we
Speaker 3: should have that their numbers are going to be good.
Speaker 6: I do think the numbers will be good, but I
Speaker 6: think there could be obstacles as we move through the year.
Speaker 6: And first off, I would anticipate that if we do
Speaker 6: see a big increase or at least a substantial increase
Speaker 6: in yields on the long end that could very easily
Speaker 6: exert downward pressure on tech stock prices. So I think
Speaker 6: that could be the first problem. But as we move
Speaker 6: through the year, we could see problems with financing, some
Speaker 6: issues with Nimby.
Speaker 3: Okay, so go there the financing you mean around AI
Speaker 3: data centers. You think about the anxiety building up around
Speaker 3: Oracle and the debt that it has to take on.
Speaker 6: Absolutely, I think that that could very well slow down
Speaker 6: the AI data center build out. So there are a
Speaker 6: number of different things that could slow progress over the
Speaker 6: course of the year and really tamp down stock prices.
Speaker 2: Christina, so stock's in near record highs and tech is
Speaker 2: pushing the way and the Nasdaq one hundreds up for
Speaker 2: a fifth consecutive session right ahead of earnings. Explain that
Speaker 2: that psychology of the market, why they would push the
Speaker 2: market higher ahead of what is a critical week for
Speaker 2: some of the biggest technology names in the world.
Speaker 6: Well, there is an old adage buy on the rumor
Speaker 6: sell on the news, and I do think there is
Speaker 6: a lot of positive sentiment right now around these companies
Speaker 6: being able to meet and potentially exceed earning ze expectations.
Speaker 6: So I think that's what's happening right now. I also
Speaker 6: believe something else is occurring, and we have to recognize
Speaker 6: that the backdrop is an economy that is sputtering. I
Speaker 6: am in the minority in this view, but I do
Speaker 6: think the economy is facing some very significant headwinds right now.
Speaker 6: We just saw consumer confidence reading that was the lowest
Speaker 6: since twenty fourteen, and I think what happens typically is
Speaker 6: in an environment like that, investors move to technology. They
Speaker 6: move to areas that are more defensive, that can perform
Speaker 6: well in a variety of different environments, the secular place.
Speaker 6: And again tech has been the poster child for secular
Speaker 6: place for some time now.
Speaker 2: So in that sense, though like nothing changes, we write
Speaker 2: in our markets wrap on the terminal, which is like
Speaker 2: it's the first thing you read every morning, right, but
Speaker 2: it says, in spite or not, even a slide in
Speaker 2: consumer confidence could stop the market rally. At the end
Speaker 2: of the day, we'll go into this earnings period at
Speaker 2: the same things capital expenditures and top line growth of
Speaker 2: the biggest companies, and then you'll come back or your
Speaker 2: peers will say well, these companies have really strong balance
Speaker 2: sheets and they're quite well diversified to weather an economic
Speaker 2: slow down. Nothing's really new.
Speaker 6: Well, I think what is becoming increasingly true is that
Speaker 6: there is a divorcing, a decoupling between Wall Street and
Speaker 6: Main Street, and that is most obvious in the tech sector.
Speaker 6: So we can see strong balance sheets, we can see
Speaker 6: companies that are performing well. But and this is a
Speaker 6: big butt, we could see external forces like yields on
Speaker 6: the long end, the ten year treasure yield, if it
Speaker 6: were to get to five percent or higher, I think
Speaker 6: that would exert downward pressure, especially on tech stock prices.
Speaker 3: So Christina, do you sell into that or do you
Speaker 3: just load up when the prices get lower?
Speaker 4: And longer term? Still they committed to tech briefly, please, So.
Speaker 6: I would say staying committed longer term to tech, but
Speaker 6: ensuring you're well diversified. You are taking some profit and
Speaker 6: moving your exposure because tech is not just in the
Speaker 6: United States, it's also in China, where valuations are significantly lower.
Speaker 6: So this is an opportunity I think to diversify portfolios.
Speaker 2: Christina Hooper, chief market strategist in the Man Group. Thank
Speaker 2: you very much, Amazon is closing its Amazon branded grocery
Speaker 2: stores and automated grab and go markets, eliminating two centerpieces
Speaker 2: of its push into physical retail and caro. Very interesting
Speaker 2: here because actually Amazon's continue to push higher since the news.
Speaker 2: The main takeaway is not that they're closing fourteen ghost
Speaker 2: stores and fifty eight fresh stores. That's small footprint, but
Speaker 2: actually even more committed to delivery. You tell me about
Speaker 2: the names that dropped in reaction, I.
Speaker 4: Mean, isn't it interesting?
Speaker 3: Well, exactly to your point, the fact that we see
Speaker 3: door Dash, we'll see other of those delivery companies maybe
Speaker 3: see it feeling the effects from all of this. But
Speaker 3: what's really interesting as well to sort of take on
Speaker 3: board is they're also deploying massive scale in terms of
Speaker 3: bricks and water in Chicago.
Speaker 4: But it's alongside the.
Speaker 3: Element that's also going to be helping delivery.
Speaker 4: It's also going to be about warehouse space.
Speaker 3: So they're just rethinking the way in which they put
Speaker 3: bricks and water on the ground.
Speaker 7: Right.
Speaker 3: Well, we're looking Walmarts, off, Ubers, off, door Dashes off.
Speaker 3: It really speaks to maybe Amazon investors thinking this is
Speaker 3: a sign of strength, a good pivot.
Speaker 2: Yeah, And lastly, grocery commitment, right, Like, they're not saying
Speaker 2: we're done with grocery, they're just saying we're moving it online.
Speaker 2: And that's reflected in that market reaction.
Speaker 3: Though it's quite like those Paler stores though, got to
Speaker 3: say rest in peace. Coming up, autonomous trucking startup Gatick.
Speaker 4: Into a new deal. We'll discuss the self.
Speaker 3: Driving companies growth with its CEO. That's next list blue
Speaker 3: bag Tech.
Speaker 2: Autonomous trucking company Gatick has landed a deal with a
Speaker 2: major consumer goods company. Gatic's not named the customer yet,
Speaker 2: but says the deal will double its contracted revenue to
Speaker 2: six hundred million dollars over the next five years, joining
Speaker 2: us as Gatti CEO and co founder Galton Nrang. Look, yeah,
Speaker 2: I'm going to few the opportunity to day in the customer.
Speaker 2: I know that you're not going to. I've pushed you
Speaker 2: over a number of days. But I think the main
Speaker 2: thing our audience wants to get a sense of is
Speaker 2: this is real. You have trucks on roads with major
Speaker 2: customers that are paying you, and therefore you're booking revenues
Speaker 2: on it. Take it from there and explain the reality
Speaker 2: for sure.
Speaker 8: So as you know, God Think is in the business
Speaker 8: of autonomous route and today we're announcing that we're operating
Speaker 8: fully driver lists, faith only drugs with no safety driver,
Speaker 8: no safety observer across real faith operations, multiple markets.
Speaker 2: To do it is small though, like ten trucks right
Speaker 2: now in today, by year end all one hundreds of drugs.
Speaker 8: But very soon in the coming weeks, we'll have over
Speaker 8: sixty drugs fully driver lists on public roads doing daily
Speaker 8: commercial operations.
Speaker 2: That's cool.
Speaker 3: Talk to us how legislatively this has worked? Regularly this
Speaker 3: has worked? How have you managed to make this a reality?
Speaker 3: While yes, we see real impact from waymowing cars, but
Speaker 3: in certain states, in certain areas.
Speaker 8: Where are you working so you know today we're live
Speaker 8: across multiple markets. This is Texas, Northwest, Arkansas, Phoenix. We
Speaker 8: work very closely with the regulators at the local, Lebel,
Speaker 8: state level, federal level, and from the early days we
Speaker 8: decided to focus on automating these regional networks, which is
Speaker 8: within the states, and that's one of the fastest ways
Speaker 8: to commercialize this technology.
Speaker 3: Commercializing then to where we've talked about six herremillion, just
Speaker 3: one key customer.
Speaker 4: What do you think your revenue run?
Speaker 6: Right?
Speaker 4: Is going to look like.
Speaker 8: So today we're working with some of the largest companies
Speaker 8: across retail, grocery, e commerce, and distribution. So each of
Speaker 8: these customers have made multi year commitment. What's unique about
Speaker 8: these commitments is these are non cancellable commitments where our
Speaker 8: technology is now being absorbed across their supply chain at scale.
Speaker 2: Those are the customers that you can name. We're showing
Speaker 2: them on the screen, Kroger, Tyson, Walmart. People will say, well,
Speaker 2: if you can't name this one, how real is it,
Speaker 2: I'm going to put it out there, right, because we're
Speaker 2: transparent on this show. The business model is interesting. You
Speaker 2: don't sell them the trucks. What is the business model?
Speaker 8: So it's an autonomous transportation as a service model as
Speaker 8: a service as a service, yes, where we charge a
Speaker 8: fixed feed prodrug pert a year, and each of these
Speaker 8: commit commitments are multi year long. So we have revenue
Speaker 8: certainty from each of these customers and that's also very
Speaker 8: unique compared to some of the other models.
Speaker 9: In our space.
Speaker 2: You have some peers in industry. One of them is Aurora, right,
Speaker 2: there are some similarities and differences. One is that they're public.
Speaker 2: You're private, sure, let's talk about that first. I mean,
Speaker 2: you know, you've been pretty open that there's a route
Speaker 2: to the public markets. What would be the motive to
Speaker 2: do that?
Speaker 8: So let me start with the fact that we have
Speaker 8: a lot of respect for all the peers in the space.
Speaker 8: But what has been our focus from day one is
Speaker 8: helping our customers move freight from their real how to
Speaker 8: retail stores and doing that at scale. And with this milestone,
Speaker 8: we have been able to prove that it's real, it's
Speaker 8: happening at scale. So today, truly there is no safety driver,
Speaker 8: no observer on public roads and in our space, no
Speaker 8: one can make that claim today public well, we are
Speaker 8: well caplized today with the very strong runway and have
Speaker 8: clear line of sight towards profitability, and we're always evaluating
Speaker 8: all the options that we have and keeping a very
Speaker 8: close watch on the market conditions.
Speaker 3: Partners From a technology perspective, obviously, in Nvidia, how much
Speaker 3: do you rely on on the hardware at the moment?
Speaker 4: How much is that cost base? Where do you look
Speaker 4: for these partnerships.
Speaker 8: So with our latest generation, generation three, the hardware is
Speaker 8: fully hardened and we're working very closely with the Nvidia
Speaker 8: with the Suzu Motors to mass produce these drugs, and
Speaker 8: towards the end of next year, Isuzu's production plant in
Speaker 8: South Carolina will be up and running and we expect
Speaker 8: to have these vehicles coming off the line at the
Speaker 8: big volumes. We're looking at tens of thousands of vehicles annually.
Speaker 2: Caroline's really asked this, right, but we should go back
Speaker 2: to it, which is the regulatory environment. Yes, you know
Speaker 2: you've launched in these markets because you can. How much
Speaker 2: do you think we need this federal level framework for
Speaker 2: you to go from very small to something more substantial.
Speaker 8: So it's really important to like have a nationwide av framework, right,
Speaker 8: So we work and we don't. Well, we're working very
Speaker 8: closely with the current administration to inform them, educate them
Speaker 8: on the safelod lot of this technology, and we expect
Speaker 8: to have a nation wide framework really soon.
Speaker 3: Come back when you've helped work that one out. Golton Narraang.
Speaker 3: It's great has in time with the GETIC CEO. Meanwhile,
Speaker 3: elsewhere in vehicles, GM CEO Mary Barras As a regulatory.
Speaker 4: Shift away from EVS.
Speaker 3: We'll see slower adoption, but the company is still committed
Speaker 3: to its EV pipeline MEGS, Matt Miller sat down with
Speaker 3: the GM CEO, Mary Barrow, take a listen.
Speaker 9: The whole industry.
Speaker 7: We were on a p as that we were working
Speaker 7: to get to forty to fifty percent evs by twenty thirty.
Speaker 7: So now that the regulatory environment has changed and the
Speaker 7: consumer incentives have gone, there is going to be slower
Speaker 7: EV adoption. We're still committed evs and we've got a
Speaker 7: great portfolio that we're working on taking costs out. But
Speaker 7: in the meantime, we also have a great internal combustion
Speaker 7: engine platform, and you're right, full size trucks are one
Speaker 7: of the strengths we have, as well as full size SUVs,
Speaker 7: mid sized crossovers. So we really have a strong line
Speaker 7: up across the board and that is really what is
Speaker 7: fueling our business success.
Speaker 10: I have had as the host of Hot Pursuit of
Speaker 10: Bloomberg podcast about cars, the opportunity to drive a lot
Speaker 10: of your evs, from the Sierra EV to the Hummer
Speaker 10: EV to the Escalaid IQ and they're fantastic products. Are
Speaker 10: you not deterred that Americans aren't buying more of these vehicles?
Speaker 10: You know how capable, how capable they are you know
Speaker 10: how useful they are in daily life. What needs to
Speaker 10: happen for more Americans to buy these evs?
Speaker 7: Well, I think the consumer is very rational when they're
Speaker 7: making a decision about what card by.
Speaker 9: Let's remember it's one.
Speaker 7: Of the most important and expensive decisions that they make.
Speaker 7: And one of the things we have to continue to
Speaker 7: work on to drive ev adaption is a more robust
Speaker 7: charging infrastructure, and that still is continuing to happen, So
Speaker 7: every quarter more and more chargers are available. I think
Speaker 7: we as people in their individual communities see that they've
Speaker 7: got a robust charging network and believe if they have
Speaker 7: to go on a road trip there's that as well,
Speaker 7: they're going to make that choice.
Speaker 2: That was GM CEO Mary Barras speaking with Bloomberg's Matt Miller.
Speaker 2: Now coming up, we will dive into anthropics new tool
Speaker 2: and how it could broadly impact jobs. Come up next,
Speaker 2: this is Bloomberg Tech Silicon Valley leaders adjoining tech workers
Speaker 2: decrying tensions in Minnesota after two US citizens were fatally
Speaker 2: shot by federal agents. Anthropic CEO Dario Emma Day posting
Speaker 2: about the quote importance of preserving democratic values and rights.
Speaker 2: Open AI CEO Sam Altman wrote in an internal memo
Speaker 2: to staff yesterday, that's what quote. What's happening with Ice
Speaker 2: is going too far. That's according to a Bloomberg source.
Speaker 2: The executives joined the chorus of other tech leaders, including
Speaker 2: LinkedIn co founder Reid Hoffman, Reddit co founder Alexis o'hanian,
Speaker 2: and venture capitalist Vinode Koestler, who have spoken out.
Speaker 3: Karen one to watch now, let's shift elsewhere for Anthropic
Speaker 3: right now, because it is released a new version on
Speaker 3: its Claude chatbot called claud cowork. They can take actions
Speaker 3: on a computer on your computer. Bloomberg opinion columnist parme
Speaker 3: Olsen writes that this could have broad repercussions and potentially
Speaker 3: be painful for some white collar workers, even as Anthropic
Speaker 3: frames itself as the most safety conscious of the AI developers.
Speaker 3: Parmi Elsen joins us, Now, so the redefinement of the
Speaker 3: engineering talent right now, the companies you've spoken to, How
Speaker 3: is Claudes products changing that?
Speaker 2: Yeah?
Speaker 11: I mean, first of all, claud cowork is the new product.
Speaker 11: And before that was claud Code, which is an AI
Speaker 11: tool for writing software programs, and that's been around for
Speaker 11: about a year and it's been getting rave reviews among
Speaker 11: technologists and coders who can use it to spin up
Speaker 11: a website within hours, and the people an Anthropic effectually
Speaker 11: use that tool to build this new tool. They did
Speaker 11: it in ten days. They didn't write a single line
Speaker 11: of code, or very little code. And this new version
Speaker 11: is something that it's sort of like people have been
Speaker 11: talking about the word AI agents. That was a big
Speaker 11: buzzword last year, but it sort of fell flat.
Speaker 9: There were issues with reliability.
Speaker 11: This could be perhaps the first mainstream breakout of an
Speaker 11: AI agent because it does work on your computer, accesses
Speaker 11: files and applications, and not just saying that it does
Speaker 11: that people are actually using I've used it, and there's
Speaker 11: been a lot of general kind of excitement and buzz
Speaker 11: about this tool that is able to just take action,
Speaker 11: not just you know if you research in.
Speaker 2: Part of the industry is paying attention. Like I think
Speaker 2: that CS Caroline was speaking to a Montenesia from General Catalyst.
Speaker 2: I think he summed it up pretty well.
Speaker 12: Just listen to this, yeah, squad, it's it's really redefining
Speaker 12: the engineering department, and just think about the size of
Speaker 12: that market you might you spend on tools and engineers
Speaker 12: to be able to build products, and you know, the
Speaker 12: amount of progress is like Silicon Value companies now code
Speaker 12: self rights for most of what they do. I think
Speaker 12: it's a real transformation with clouds really enabled.
Speaker 2: There there's a line in your Bloomberg opinion column, which
Speaker 2: by the way, is one of the most read things
Speaker 2: today on Bloomberg about the relevance to Microsoft. You know,
Speaker 2: Microsoft historically is very good at selling software that you
Speaker 2: could otherwise get for free. Just just talk a little
Speaker 2: bit more about that. You kind of flicked it.
Speaker 11: I just looked at it because I thought Cowork is
Speaker 11: pretty much what Copilot could have been and probably should
Speaker 11: have been. Copilot is the AI tool that's underpinned by CHATGBT,
Speaker 11: GPT four point five or whatever the latest model is,
Speaker 11: and it has access to all your office tools, so
Speaker 11: it should be able to, you know, take documents from
Speaker 11: a particular folder and turn them into a spreadsheet, as
Speaker 11: claud Cowork can do, but it doesn't have quite that
Speaker 11: same capability. So I think the speed at which Anthropic
Speaker 11: was able to do this and using an AI tool
Speaker 11: to build the software in the first place, really speaks
Speaker 11: to how effective AI coding has become. You know, coders
Speaker 11: are saying now they don't even write code anymore. They
Speaker 11: just talked to it in plain language. And the reason
Speaker 11: I think this is kind of meaningful for other jobs
Speaker 11: is coding AI coding a tool that can do that
Speaker 11: can generalize to other domains. This is what Anthropics CEO
Speaker 11: has been saying. That's why they're moving into healthcare and
Speaker 11: who knows what other areas they will move into. But
Speaker 11: I think because computer code is such a perfect digital
Speaker 11: representation of you know, the behavior that you and the
Speaker 11: actions that you can take online. That's why it can
Speaker 11: be so good as a tool to do other things
Speaker 11: like operate a computer.
Speaker 2: Bloomberg Opinions, PA me awesome with today's must read, Thank
Speaker 2: you very much, so coming up Northward raises one hundred
Speaker 2: million dollars in its latest funding. We speak with the
Speaker 2: CEO Bridget Menla. That conversation coming up next and you
Speaker 2: don't want to miss it. This is Bloomberg Tech.
Speaker 4: Welcome back to Bloomberg Tech.
Speaker 3: A quick check on these markets Nasdaq one hundred shows
Speaker 3: big tech is back on top. We're still almost a
Speaker 3: percentage point as we brace for mag seven earnings. Interesting
Speaker 3: move for bitcoin, we call it digital gold Well it's
Speaker 3: not getting the debasement trade that real gold is. At
Speaker 3: the moment, we're an eighty two hundred and forty six though,
Speaker 3: just up in the green ever so slightly. Move on
Speaker 3: to the individual movers. We want you to keep an
Speaker 3: eye on Amazon up almost one and a half percent.
Speaker 3: They're closing Amazon Fresh Amazon ghost stores with some locations
Speaker 3: are going to be converted into whole foods market stores. Look,
Speaker 3: they are not moving away from groceries. They're going to
Speaker 3: sell them online and offline. But really this is about
Speaker 3: delivery once again. And you also have to look at
Speaker 3: what's happening over at Pinterest. We're going to dwell on
Speaker 3: that for a minute. We're off by almost ten percent.
Speaker 3: They are letting go of people less than fifteen percent
Speaker 3: of its workforce. We understand that they're planning to reduce
Speaker 3: office space as well, and Bloomberg Intelligence is saying it
Speaker 3: likely suggests more aggressive investments in building AI capabilities. Let's
Speaker 3: stick in with blouemmeg Exiti's reporter around Verastelica, a company.
Speaker 4: That has seen competition ride.
Speaker 3: Maybe as we talk more and more about Agendaki, we're
Speaker 3: just talking about it in terms of anthropic For example.
Speaker 13: Yes, good morning, thanks for having me. So pinterest is
Speaker 13: down quite significantly today. It does seem like there is
Speaker 13: a lot of concern that these workforce reductions and other
Speaker 13: steps that they're taking in terms of this restructuring, that
Speaker 13: maybe this pours in some weaker growth trends at the company.
Speaker 13: As I'm sure you know, this stock has struggled for
Speaker 13: quite a bit of time as it really just has
Speaker 13: a lot of difficulty going up against the bigger players
Speaker 13: in the space, most notably Meta. So the stock is
Speaker 13: quite down, and I think people are sort of like
Speaker 13: wondering what's going to be sort of a catalyst or
Speaker 13: revive growth here.
Speaker 2: Ryan, Data is fun. I really hope that you agree
Speaker 2: with that. And so I'm looking at the Bloomberg terminal.
Speaker 2: The Nazak one hundred is for a five day stretch
Speaker 2: the first time this year. It had a five day
Speaker 2: stretch at the end of December, so not that long ago.
Speaker 2: We're right on the cusp of huge earnings and tech
Speaker 2: is driving this market higher. Why great question.
Speaker 13: So going into this recent rally, obviously there had been
Speaker 13: a rotation out of Tech, a lot of people looking
Speaker 13: elsewhere in the market, especially sort of cyclical parts of
Speaker 13: the market.
Speaker 2: There was some concern about Tech's earnings.
Speaker 13: Is growth decelerating or is this going to be enough
Speaker 13: to justify the valuations there. At the same time, people
Speaker 13: continue to view tech as really a port of safety
Speaker 13: in the market, continues to be very dominant and still
Speaker 13: has the highest growth among the S and P five
Speaker 13: hundred sectors. People remain pretty positive about his prospects, about
Speaker 13: the potential of AI, all that is there. It's not
Speaker 13: surprising to me to see a little bit of people
Speaker 13: wanting to jump in buy that dip, you know, especially
Speaker 13: ahead of earnings.
Speaker 2: The most ryan for Stelica. Oh sorry, carry, I got
Speaker 2: excited about the data thing I do with the earnings
Speaker 2: preview and embraced right, let's go to private markets for
Speaker 2: a second. Northwood has announced it's raised one hundred million
Speaker 2: dollars in new funding led by Washington Harbor Partners and
Speaker 2: Indres and Horowitz. The Southern California based company makes phased
Speaker 2: array and tenors and other things that help increase satellite
Speaker 2: connectivity here on Earth. Here with the latest is Bridget
Speaker 2: Menla Northwood CEO. You know, Bridget, We've been fortunate to
Speaker 2: talk to you, you know, a number of times over
Speaker 2: over the last year. Actually, like this is less than
Speaker 2: a year from your Series A. And the thing that
Speaker 2: I've learned speaking to us future investors is that you
Speaker 2: move quickly, right, you move quickly on deployment of the tech.
Speaker 2: But you've also let's start by just asking like, why
Speaker 2: did you need to raise one hundred million dollars here?
Speaker 2: There must be a need for that capital.
Speaker 14: Yeah, absolutely, thanks for having me again, It's great to
Speaker 14: be speaking with you all. For us, it's really about
Speaker 14: taking space missions further faster. I think you guys have
Speaker 14: been really tracking the developments in the space industry over
Speaker 14: the past year, both on the commercial side and on
Speaker 14: government side.
Speaker 9: Domestically and abroad.
Speaker 14: There's a ton of enthusiasm for what we can do
Speaker 14: in space and really changing our.
Speaker 9: Perceptions on what's possible.
Speaker 14: Oftentimes, there winds up being more friction and taking those
Speaker 14: space missions live due to the ground and that's something
Speaker 14: that has to change. We have to be able to
Speaker 14: push the boundaries on capabilities, and we have to be
Speaker 14: able to do that on a rapid time scale. So
Speaker 14: for us, what this funding represents is a significant amount
Speaker 14: of demand that we've seen from a wide variety of
Speaker 14: customers and being able to enable their missions to go
Speaker 14: further faster. So this year has been a really exciting
Speaker 14: example for us to kind of show what that end
Speaker 14: to end concept looks like for Northwood. Many people do
Speaker 14: know us by our Phase raise, which is critical to
Speaker 14: how we think about the ground really introducing novel hardware
Speaker 14: solutions so that we can do more in space. But
Speaker 14: we view ourselves as an end to end partner for
Speaker 14: these space missions all the way from the concept that
Speaker 14: they are initially coming up with to the time when
Speaker 14: their data is streaming live and actually you know, delivered
Speaker 14: to end users.
Speaker 9: And we've actually done that.
Speaker 14: We've gone from an initial concept of saying, hey, let's
Speaker 14: have dynamic links that you can access not just from
Speaker 14: low Earth orbit but all the way up to geostationary
Speaker 14: orbit in the same system, and then let's show how
Speaker 14: fast we can bring that concept into reality. And so
Speaker 14: you know, we're talking today as well about our contract
Speaker 14: that we close with the US Space Force.
Speaker 2: Well, bridget let me jump in here. Like they know,
Speaker 2: it's a forty nine million dollar contract with the Space Force.
Speaker 2: You know, what will you be doing with them specifically?
Speaker 2: But also my understanding is that there is a link
Speaker 2: here between the money that you raised in the Series
Speaker 2: B and being able to kind of just execute on
Speaker 2: that contract.
Speaker 14: Absolutely well, we've already executed on that contract across a
Speaker 14: number of milestones. So contract was executed and at this
Speaker 14: point there's been a three month turnaround time from kickoff
Speaker 14: of that contract to actually delivering links live in the field.
Speaker 14: So we have those links live in the field already,
Speaker 14: and so what the funding represents for us is, let's
Speaker 14: scale that model, Let's do it more. Let's demonstrate how
Speaker 14: we're able to deploy a global network of this portal
Speaker 14: product that supports the dynamic links between lower orbit and
Speaker 14: geostationary orbit, but also serve up more space capabilities that
Speaker 14: we're getting a lot of appetite for. So the funding
Speaker 14: really represents being able to serve the appetite that we're
Speaker 14: seeing and hit larger production volumes.
Speaker 3: We've been lucky enough to talk to some of your
Speaker 3: key investors and Mina has been on the show before
Speaker 3: from Washington Harbor Partners, and you put it to Ed
Speaker 3: that Northwood provides the only viable approach capable of scaling
Speaker 3: ground station capacity, but you're not actually technically the only
Speaker 3: approach that could be taken because you could also go
Speaker 3: to blue Halo for example. So what is your unique
Speaker 3: setting point, how you differentiate it from others that have
Speaker 3: been winning contracts.
Speaker 14: Yeah, I think the way that we view our difference
Speaker 14: is really for space providers today, they wind up running
Speaker 14: two companies. They wind up having to run the space
Speaker 14: mission that they're supporting, but they also have to stitch
Speaker 14: together a complex value chain of different pieces of the ground.
Speaker 9: You know, they have to think about ground hardware like you.
Speaker 14: Mentioned, you know, blue Halo and other developer of phase
Speaker 14: or A hardware, but they also have to think about,
Speaker 14: you know, sites, global shipping logistics operations around the world.
Speaker 14: They have to think about the software interfaces in the
Speaker 14: network backbone attached to that. And so where we find
Speaker 14: ourselves really differentiated is we take on that full problem scope.
Speaker 14: And I think you know, what we've connected with with
Speaker 14: MINA specifically on is the importance of being able to
Speaker 14: deliver the end to end solution and do it on
Speaker 14: a condensed timeline. And we feel like there's huge value
Speaker 14: in being able to do that, and that's why we've
Speaker 14: invested in that kind of differentiated approach.
Speaker 3: You've kindly said, we've been focused on space for quite
Speaker 3: a while here on the show, and many are now
Speaker 3: training that advice on SpaceX.
Speaker 4: But are you winning contract? How's your relationship being built
Speaker 4: with Starlink for example? Are the I any talks along
Speaker 4: that motion?
Speaker 11: Yeah.
Speaker 14: I think for us, we've seen significant interests from commercial
Speaker 14: as well as government use cases. The ambition and the
Speaker 14: challenge for space just continues to grow. And for ourselves,
Speaker 14: we've had contact with that company and with other companies,
Speaker 14: and we're excited to have our capabilities just kind of
Speaker 14: be the proof in themselves that we are the infrastructure
Speaker 14: provider that makes sense for a whole host of industry
Speaker 14: use cases.
Speaker 2: Bridgie, I know you don't want to focus on this necessarily.
Speaker 2: You know, your former actor, platinum singer songwriter, you went away,
Speaker 2: turned to academia, founded Northwood right at the end of
Speaker 2: twenty twenty two, did a series A at the beginning
Speaker 2: of twenty four and now here we are, and I
Speaker 2: think there's a lot of interest to learn how big
Speaker 2: is Northwood now? How many people? What is your footprint?
Speaker 2: Where are you deployed around the world, because you have
Speaker 2: done it quite quickly.
Speaker 14: Yeah, we're just around seventy people. We have sites deployed
Speaker 14: across two continents. At this point in time, we have
Speaker 14: a full production facility running not just our Phasory product,
Speaker 14: but two other hardware products that both fit in with
Speaker 14: that hardware stack as well as work and complement to it.
Speaker 14: So excited to be sharing those product lines as well.
Speaker 14: And this year is going to be a really big
Speaker 14: year for us. We're planning on deploying eighteen sites across
Speaker 14: five continents. So just continuing to ramp up our production
Speaker 14: and the offerings that we can provide to the space
Speaker 14: industry this year, Bridget.
Speaker 2: As you know, Caroline and I are very thorough on
Speaker 2: Bloomberg Tech. Just very quickly, the company did not disclose
Speaker 2: its valuation. Is northward at Unicorn status yet? Is that
Speaker 2: a milestone that you've achieved.
Speaker 14: We will not disclose valuation at this point in time,
Speaker 14: but we're very.
Speaker 9: Happy with where we ended up.
Speaker 3: Nice answer, Briship Lendler of Northwood.
Speaker 4: We always have to ask.
Speaker 3: We appreciate you coming back, Thank you very much, indeed, congrats. Meanwhile,
Speaker 3: coming up the AI landscape, it shifts from general AI
Speaker 3: to highly specialized intelligence systems. We're going to be discussing
Speaker 3: that with constantin Ula, of course, a partner at Sekoia.
Speaker 4: This is bluebg Tech.
Speaker 3: This is Bloomberg Tech, and you are looking at a
Speaker 3: live shot at the principal room.
Speaker 4: Check out the Bloomberg Tech podcast. Find it on the
Speaker 4: terminal as well as online.
Speaker 3: On Apple, Spotify, and iHeart this is Bloomberg. Moonshot AI
Speaker 3: has released an upgrade to its flagship model. I'm thing
Speaker 3: up pressure in China's domestic AI race look. The company's
Speaker 3: K two point five model is said to outperform its
Speaker 3: open source peers and can process text, images, videos simultaneously.
Speaker 4: From just a single prompt now.
Speaker 3: The release comes ahead of deep Seak's next major update,
Speaker 3: which has been teasing now four weeks ed.
Speaker 2: What have you got. Let's stay on the topic of
Speaker 2: AI and not just general purpose models, but the rise
Speaker 2: of artificial specialized intelligence. Joining us now Constantine Buler partner
Speaker 2: at Sequoia, and this is your bet for the year.
Speaker 2: You think and where you will focus your investments going
Speaker 2: forward is in the area of do we call it
Speaker 2: asi specialized intelligence as a place to start, define that
Speaker 2: what is the difference? Absolutely?
Speaker 15: Ad Caroline, Thanks for having me twenty twenty six is
Speaker 15: going to be the year all about AI capabilities in
Speaker 15: specialized areas.
Speaker 2: And we've got a taste of this.
Speaker 15: In twenty twenty five in some pretty big important categories.
Speaker 2: Think about self driving.
Speaker 15: We now have waymos on the streets of San Francisco
Speaker 15: and any other places and many other places, and those
Speaker 15: are operating ten times safer than the average human driver,
Speaker 15: ten times safer. Also, you see other specialized areas. Anthropic,
Speaker 15: for example, focused on coding and in twenty twenty five
Speaker 15: went mainstream with their cloud code product where developers can
Speaker 15: choose to work with cloud code agents to prototype and
Speaker 15: even put software into production much faster. We're going to
Speaker 15: see a lot more of that in twenty twenty six.
Speaker 15: It's going to be specialized capabilities in many new areas.
Speaker 2: Now, how big are the checks? Then you're going to
Speaker 2: have to write because what weimo Anthropy and even like
Speaker 2: in the legal sector, like a Harvey having common is
Speaker 2: that they are well capitalized at this point. They had
Speaker 2: to commit a lot of capital to train those specialized
Speaker 2: models in the first place and then deploy them absolutely well.
Speaker 15: You mentioned to Harvey, I'm focused on the early stage
Speaker 15: investing and in the case of Harvey, they started really small.
Speaker 15: They basically focused on an area and they said, hey,
Speaker 15: this is an area we're going to be deep experts in.
Speaker 15: That's the legal area, and they focused on the actual
Speaker 15: user obsession. They now have over one thousand customers for
Speaker 15: the legal tech space, and they are kind of a
Speaker 15: right hand person to the lawyer. In fact, one of
Speaker 15: their customers said, I would sooner lose my coffee for
Speaker 15: the year than my Harvey license. My sister's is a lawyer,
Speaker 15: she uses Harvey. She'd probably say the same exact thing.
Speaker 15: Twenty twenty six, We're going to look back at the
Speaker 15: end of the year and realize how many areas in
Speaker 15: AI we just couldn't live without.
Speaker 4: Constantin Where is next?
Speaker 3: Therefore, because you actually already have made these bets in
Speaker 3: these very focused areas and applications of AI.
Speaker 4: We just named Harvey, but you're.
Speaker 3: Also in eleven labs if you're thinking about the way
Speaker 3: in which we're going to interact with it from a
Speaker 3: vocal perspective and create ourselves. But Where's next hasn't been
Speaker 3: disrupted absolutely.
Speaker 15: I'll give two tastes of what's coming next, one in
Speaker 15: the physical world, and then one in the digital world.
Speaker 15: In the physical world, were investors in a company called Vercata.
Speaker 15: They are the leading AI physical security company and they're
Speaker 15: basically an extension to those physical security guards who walk
Speaker 15: around a premise and can now monitor an even larger
Speaker 15: premis for physical security. They help investigations go thirty percent faster,
Speaker 15: dramatically faster. And that sounds like a statistic, but let's make.
Speaker 2: It very real.
Speaker 15: They were working with a major airport that had a
Speaker 15: bomb threat and they were able to help close that
Speaker 15: investigation significantly faster, which means that the airplanes actually boarded, flights,
Speaker 15: got out on time, and passengers got to their destination.
Speaker 2: We're going to see a lot of that now.
Speaker 15: In the digital world. We work with a company called Expo.
Speaker 15: It's a AI penetration tester. They set out to get
Speaker 15: really good at finding vulnerabilities in websites and applications. Within
Speaker 15: six months, they became as good as a human penetration tester,
Speaker 15: a profession at finding vulnerabilities. Within eighteen months, they've actually
Speaker 15: become best in the world. They're top ranked on hacker one,
Speaker 15: which is the global leader board for individual hackers, and
Speaker 15: they're finding major vulnerabilities at companies, reporting those to the companies,
Speaker 15: helping them patch them so that the bad guys don't
Speaker 15: get there. We'll have a lot more capabilities like that
Speaker 15: in twenty twenty six.
Speaker 3: What's interesting is how therefore you're going to build and
Speaker 3: scale at the pace that's necessary. If there's a lot
Speaker 3: of capital looking for these more specialized areas, there are
Speaker 3: people building in it, how do you talk to your
Speaker 3: portfolio companies at this moment being like, you need to
Speaker 3: get that edge, you need to lead the market at
Speaker 3: this moment because there's an opportunity that's moving fast.
Speaker 2: Absolutely right, Caroline.
Speaker 15: And you know, we think about the word courage in
Speaker 15: twenty twenty six. There's been so much focus on the
Speaker 15: frontier four Open AI and Anthropic and Google and Xai.
Speaker 15: They're doing amazing work, and it can be intimidating for
Speaker 15: the early stage founder to say, you know what, I'm
Speaker 15: going to go up and build an amazing big company
Speaker 15: in the presence of these giants. But we encourage founders
Speaker 15: to be courageous in twenty twenty six. They know areas deeply,
Speaker 15: know those areas specialize in that delight your customers, and
Speaker 15: there will be amazing opportunity. For example, in the healthcare space,
Speaker 15: we work with a company called Open Evidence, which helps
Speaker 15: physicians diagnose really complicated problems. In fact, my wife is
Speaker 15: a surgeon. She uses Open Evidence to help diagnose problems.
Speaker 15: She takes that extra time and puts it back into patients.
Speaker 15: That was started by someone who said, you know what,
Speaker 15: the healthcare area is so important that it's going to
Speaker 15: need specialization, it's going to need these specific capabilities. And
Speaker 15: they've been absolutely right. That type of courage will continue
Speaker 15: to pay off.
Speaker 2: In twenty twenty six, I started the week with my
Speaker 2: column about how there's no point using the term seed
Speaker 2: round anymore because some of them are in the hundreds
Speaker 2: of millions of dollars right out the gate with a
Speaker 2: team of a dozen people. That's the domain that you
Speaker 2: oper eight in. But it particularly in the field of AI.
Speaker 2: How much do you expect that trend to keep happen?
Speaker 2: You know, you keep saying I invest early, but you
Speaker 2: know that that actually you're not the only person that's
Speaker 2: looking at ASI. And you know the whole point is
Speaker 2: standing up sometimes a research lab from scratch.
Speaker 15: I loved your article the coconut round, right the coconut
Speaker 15: round or the avocado round or the mango seed round. Yeah, yeah,
Speaker 15: these massive seeds. I'll say, how we think about it? Sure,
Speaker 15: First and foremost, we don't think about the size of
Speaker 15: the seed. We think about the quality of the company.
Speaker 15: So we take a step back and we look at
Speaker 15: an AI business, and first of all, we might say,
Speaker 15: this is an AI business that does X, Y or Z,
Speaker 15: and we'll cover the term AI. We'll put our finger
Speaker 15: over the term AI and say does it still make
Speaker 15: sense as a business even without AI?
Speaker 2: That's test number one.
Speaker 15: And secondly, if it does, then we say, is this
Speaker 15: the kind of business that we want to spend years
Speaker 15: really being company builders for? And once we go through
Speaker 15: those phases, then we look at the financing dynamics and
Speaker 15: the size of the round and we decide, hey, is
Speaker 15: this something that we want to do with that scale.
Speaker 15: I've consistently found that great founders are willing to pick
Speaker 15: the best possible partners and shape rounds that are smart
Speaker 15: for the business in the long term and then attract
Speaker 15: more and more capital in the years to come. That's
Speaker 15: how we've been approaching these sizable seat rounds.
Speaker 4: Constantine come back.
Speaker 3: We always of it Constantine, Buna of Sequoia appreciate it.
Speaker 3: Now we turn our attention to France because the National
Speaker 3: Assembly there has followed in the footsteps of Australia, passing
Speaker 3: a bill last night to ban under fifteen year olds
Speaker 3: from social media. Legislation now heads to France's Senate. The move,
Speaker 3: of course, comes as Meta TikTok YouTube they head to
Speaker 3: court in the United States over allegations that they misled
Speaker 3: the public about the safety of their apps, accusations the
Speaker 3: companies have rejected.
Speaker 2: Ed coming up, there is no one quite like Jensen Wang.
Speaker 2: What does that mean for succession planning at Nvidia. We'll
Speaker 2: have that discussion next. This is Bloomberg Tech. When you
Speaker 2: see the future of AI is resting on the shoulders
Speaker 2: of Nvidia, But the future of the chip maker after
Speaker 2: its current CEO and co founder Jensen Wong departs one day, well,
Speaker 2: that's unclear. Bloomberg's semiconductor reporter in King has written a
Speaker 2: pretty wonderful piece. I mean, Jensen Wong has been at
Speaker 2: the helm of Nvidia for more than three decades. He
Speaker 2: is the longest seven Silicon Valley CEO. There is no
Speaker 2: suggestion that he's wants to pack it in. But what
Speaker 2: you're writing about is nor is there any evidence that
Speaker 2: Nvidia has really done anything in succession either. Yeah.
Speaker 16: I mean, you know, with a company that's become as important,
Speaker 16: it has to a whole industry and arguably the stock
Speaker 16: market and the economy as well. Usually like to have
Speaker 16: a better idea of who the people at the top are,
Speaker 16: and even people like myself who've been looking at this
Speaker 16: company for a very long time, it's him, right. The
Speaker 16: whole company is built around him, and that's all there
Speaker 16: is to it.
Speaker 3: And what's really interesting is you interview people who talk
Speaker 3: about how flat the organization is and alsomate how difficult
Speaker 3: would be to run by.
Speaker 4: Anyone else than Chansten.
Speaker 3: One can he talks to who the other well key
Speaker 3: presidents are, but perhaps and not in line to.
Speaker 4: Take the throne.
Speaker 16: Yeah, I mean, you know, the way to do this
Speaker 16: is to think about things through Jensen's eyes, because he's
Speaker 16: explicit about this. He created an organization where he wants
Speaker 16: to know where he believes the CEO needs to know
Speaker 16: what's going on, and the way to do that is
Speaker 16: to have less of the traditional corporate structure and just
Speaker 16: a large group forty to fifty sixty depends on the
Speaker 16: day as to the number he gives you. Of people
Speaker 16: who don't directly report to him, they have responsibilities.
Speaker 2: But we've spoken to Jensen quite a lot in the
Speaker 2: last few years. There are other people though, like collect Cress.
Speaker 2: The CFO is a highly capable person. But as you
Speaker 2: write in Silicon Valley and Tech, you don't usually hire
Speaker 2: the CEO from the finance department.
Speaker 16: Correct, I mean, you know, has a good reputation on
Speaker 16: Wall Street. She was brought in and she's obviously presided
Speaker 16: over the company when it's been enormously successful. But this
Speaker 16: is a very technical job, and it's also a very
Speaker 16: dynamic job. He's on the one hand a science leader,
Speaker 16: and he's on the other hand an advocate and driving
Speaker 16: the whole industry forward.
Speaker 4: And spends a lot of time on planes.
Speaker 3: It feels like at the age of sixty three, Bloomberg
Speaker 3: zin king, thank you very much, I urge of yours
Speaker 3: to go read that Deep Dive. It's a great piece
Speaker 3: and video's lack clear successor for superstar CEO.
Speaker 4: That does it though for this edition a Bloomberg techech.
Speaker 2: Yeah, there's a lot happening in public markets and in
Speaker 2: private markets, but we are bracing for big tech earnings
Speaker 2: in earnest check out the pods so much to recap
Speaker 2: you know where to find it on iHeart, Spotify, Apple,
Speaker 2: and of course in all the Bloomberg platforms as well.
Speaker 2: Two days into an astonishingly busy week in the world
Speaker 2: of technology. This is Bloomberg Tech