WEBVTT - Super Micro and Snap Warn of Economic Headwinds, Grab Raises Forecast 0:00:02.520 --> 0:00:09.119 Bloomberg Audio Studios, podcasts, radio news from the heart of 0:00:09.200 --> 0:00:14.920 where innovation, money and power collide in Silicon Valley and beyond. 0:00:15.360 --> 0:00:31.400 This is Bloomberg Technology with Caroline Hyde and Ed Ludlow. 0:00:33.960 --> 0:00:36.920 We are live from New York. This is Bloomberg Technology 0:00:36.960 --> 0:00:39.960 and Markets. They stumble off. The worst contraction in US 0:00:40.080 --> 0:00:43.839 GDP since twenty twenty two suggests the economy is at 0:00:43.960 --> 0:00:46.280 risk of buckling under the way of President Trump's tariff. 0:00:46.800 --> 0:00:50.000 This haulting a week long recovery inequities. We're down on 0:00:50.040 --> 0:00:52.000 the S and P five hundred, We're down on NASBA 0:00:52.159 --> 0:00:54.160 one point six percent ed. And you're looking at some 0:00:54.200 --> 0:00:55.800 of the individual names that drag us low US. 0:00:55.840 --> 0:00:58.440 Yeah, let's start with super Micro. This is a severe decline. 0:00:58.560 --> 0:01:02.560 Prelim third quarter results show softness. What super Micro is 0:01:02.600 --> 0:01:06.040 saying is that customers are delaying orders. We're showing you 0:01:06.040 --> 0:01:08.320 in video on the screen because the question the market's 0:01:08.360 --> 0:01:12.039 asking itself is how much is super Micro a proxy 0:01:12.160 --> 0:01:13.200 for in Vidia demand? 0:01:13.240 --> 0:01:13.479 Why? 0:01:13.760 --> 0:01:17.080 Super Micro takes in Video's technology and packages it into 0:01:17.120 --> 0:01:19.880 a server, And there's evidence that customers may be holding 0:01:19.880 --> 0:01:22.760 off of obsolete chips waiting for the new stuff or 0:01:22.880 --> 0:01:24.800 we've got a bigger picture demand problem. And video is 0:01:24.800 --> 0:01:27.640 also in the headlines, of course, because it's CEO is 0:01:27.680 --> 0:01:31.000 on Capitol Hill. Bloomberg's Amory Horden just spoke to Invidia 0:01:31.080 --> 0:01:32.639 CEO jensenmong earlier this morning. 0:01:32.680 --> 0:01:33.120 Listen to this. 0:01:34.440 --> 0:01:37.440 In order to produce five hundred billion dollars worth of 0:01:37.440 --> 0:01:41.200 AI infrastructure requires enormous amounts of investment from a lot 0:01:41.240 --> 0:01:45.280 of different partners, and so we've brought on shore many 0:01:45.319 --> 0:01:47.520 partners to help us do that, and we're going to 0:01:47.560 --> 0:01:49.120 have to build our own factories. 0:01:48.720 --> 0:01:49.440 In order to do that. 0:01:49.600 --> 0:01:51.640 What's your message and conversation can be like today with 0:01:51.680 --> 0:01:52.680 the President when. 0:01:52.480 --> 0:01:53.880 It comes to tariffs. 0:01:55.160 --> 0:01:57.520 Or our football I'm going to count on the fact 0:01:57.520 --> 0:02:02.080 that the administration that has a good plan and from 0:02:02.080 --> 0:02:05.520 our perspective, we would like to have policies that support 0:02:05.800 --> 0:02:08.840 and help accelerate the development of artificial intelligence in this 0:02:08.919 --> 0:02:09.680 new industry. 0:02:10.000 --> 0:02:11.360 Do you think they're going to have an edit of 0:02:11.360 --> 0:02:14.400 the diffusion rule that was under the bienn administration, basically 0:02:14.480 --> 0:02:16.680 placing all these different countries in different buckets. 0:02:17.639 --> 0:02:21.120 Well, I'm not sure what the new diffusion rule is 0:02:21.160 --> 0:02:24.960 going to be, but whatever happens to be it becomes 0:02:25.200 --> 0:02:28.240 it really has to recognize that the world has changed 0:02:28.400 --> 0:02:34.239 fundamentally since the previous diffusion rule was released. We need 0:02:34.280 --> 0:02:38.480 to accelerate the diffusion of American AI technology around the world, 0:02:38.800 --> 0:02:42.680 and so the policies and the encouragement from the administration 0:02:42.840 --> 0:02:44.000 really needs to be behind that. 0:02:44.840 --> 0:02:47.440 In Vidia CEO Chasin Hwang, they're along with our own 0:02:47.480 --> 0:02:50.480 ann Marie Horden. Look, let's stick with the AI sector. 0:02:50.600 --> 0:02:52.760 Go back to super micro sinking. As we heard from 0:02:52.919 --> 0:02:55.440 ED after pre announcing results that fell well short of 0:02:55.440 --> 0:02:58.160 balanced estimates, and as a server maker said, some customers 0:02:58.160 --> 0:03:02.080 are delaying their purchasing. Intelligence analyst Wu Jinhoe joins us 0:03:02.080 --> 0:03:02.400 now and. 0:03:02.360 --> 0:03:04.160 Look amsts to interview. 0:03:04.200 --> 0:03:07.280 This is pretty specific to the new and Video Blackwell 0:03:07.400 --> 0:03:08.480 chip transition, right. 0:03:09.240 --> 0:03:12.920 Yeah, hey Caroline, so it seems to be specific to 0:03:13.120 --> 0:03:16.560 the Nvidio black Well. I will tell you that customers 0:03:16.600 --> 0:03:19.560 are waiting for the leaders generationships. We saw this not 0:03:19.600 --> 0:03:21.600 only a super Micro, but we also saw with HPE 0:03:21.720 --> 0:03:25.280 when they missed their expectations last quarter. So you know, 0:03:25.680 --> 0:03:31.000 customers are essentially delaying these these these deals and just 0:03:31.040 --> 0:03:33.360 moving on to the black loss. 0:03:33.560 --> 0:03:35.920 I think we're Jim, what we heard from the interview 0:03:35.960 --> 0:03:39.200 of Jensen Hangji. Just then, is long term goals right 0:03:39.280 --> 0:03:42.760 for the manufacturing of accelerated computing in this country in 0:03:42.800 --> 0:03:46.600 the short term, help our audience understand in video's commitment 0:03:46.880 --> 0:03:50.040 to a new generation of chip every year and annual cadence, 0:03:50.320 --> 0:03:53.080 and how difficult that is for the server assemblers like 0:03:53.400 --> 0:03:56.120 super Micro, who have to be the go to market 0:03:56.200 --> 0:03:57.480 channel for that company. 0:03:58.240 --> 0:04:01.400 Yeah, and then that's that's a good question, and it 0:04:01.480 --> 0:04:08.080 is actually somewhat problematic to some of the server manufacturers. 0:04:08.160 --> 0:04:10.640 I will tell you a couple of things. The server 0:04:10.760 --> 0:04:13.240 manufacturers do have a couple of years of lead time 0:04:13.280 --> 0:04:15.960 in terms of the product roadmaps, so there is some 0:04:16.040 --> 0:04:19.200 preparation in terms of preparing for those chips. Now, now 0:04:19.240 --> 0:04:21.840 the issue is the customers may not have that level 0:04:21.839 --> 0:04:25.360 of visibility in terms of assembling all of these together, 0:04:25.400 --> 0:04:29.839 because every generation of chips add on to a new 0:04:29.960 --> 0:04:32.520 level of complexity. If we think about the H one 0:04:32.600 --> 0:04:35.560 hundred series, the Hoppa series, you didn't have to have 0:04:35.600 --> 0:04:39.799 as much cooling unecessary. Now as we move into Blackwell, 0:04:40.040 --> 0:04:42.120 you're going to have to have a cooling to support 0:04:42.120 --> 0:04:45.040 one hundred and forty killer watts per RAQ and if 0:04:45.240 --> 0:04:48.320 once we get into the next generation of chips, we're 0:04:48.320 --> 0:04:51.360 talking about six hundred kilowats paract. So it's more of 0:04:51.400 --> 0:04:55.120 an infrastructure problem, but also not only an infrastructre problem, 0:04:55.120 --> 0:04:57.919 but also an architecture problem that the customers need to 0:04:57.920 --> 0:04:58.280 deal with. 0:04:58.320 --> 0:05:00.640 The last time I spake to Jensen last month, he said, 0:05:00.680 --> 0:05:02.520 I'm the only CEO on the planet that will tell 0:05:02.560 --> 0:05:04.680 you what I'm doing for the next five years, and 0:05:04.760 --> 0:05:08.000 all my suppliers upstream downstream can follow suit. I think 0:05:08.040 --> 0:05:10.920 that's your point. Bloomberg Intelligence analyst Wu Jinho. Great to 0:05:11.000 --> 0:05:14.080 have you on the program. Turning to more earnings, Microsoft 0:05:14.279 --> 0:05:17.160 reports results after the bell, and investors are expected to 0:05:17.200 --> 0:05:20.080 pay close attention to the company's data center spending. 0:05:20.160 --> 0:05:20.520 For more. 0:05:20.640 --> 0:05:23.720 We're joined by Rebecca wednerman CEO and principle of Valuaye. 0:05:24.320 --> 0:05:27.960 That's the link right that Jensen Vwang Vinvidia says, here's 0:05:27.960 --> 0:05:31.480 my technology for the next five years. In the short term, 0:05:31.640 --> 0:05:35.039 we look at the capital expenditures of the hyperscalers and 0:05:35.080 --> 0:05:37.279 see if they're willing to plan to spend on that 0:05:37.320 --> 0:05:38.279 technology in advance. 0:05:38.279 --> 0:05:42.039 Rebecca absolutely ed great to be here, Thanks for having me. 0:05:42.480 --> 0:05:44.279 We have to look at what they're willing to spend, 0:05:44.279 --> 0:05:46.839 but also look at what customers are willing to spend 0:05:46.880 --> 0:05:49.920 to drive that AI demand so they can actually generate 0:05:49.960 --> 0:05:50.640 revenues from it. 0:05:51.440 --> 0:05:53.680 And when they're thinking about spending, we had a commitment 0:05:53.720 --> 0:05:56.760 from Alphabet sticking to its seventy five billion. Microsoft has 0:05:56.800 --> 0:05:58.800 been there saying we're spending more than eighty billion, but 0:05:58.839 --> 0:06:01.560 there have been so many courts Rebecca that they might 0:06:01.600 --> 0:06:05.359 be ending leases. We've had TD Cowen and others. What 0:06:05.440 --> 0:06:08.320 if you listened to what's noise what's reality? 0:06:09.839 --> 0:06:11.720 Well, I think Carol, and we have to look at 0:06:12.160 --> 0:06:13.920 the profit and margin picture. 0:06:14.040 --> 0:06:14.200 Right. 0:06:14.240 --> 0:06:17.400 If customers aren't willing to spend on consumption for AI 0:06:18.000 --> 0:06:20.960 demand is not maybe what Microsoft expected it would be, 0:06:21.279 --> 0:06:24.240 they're building out capacity in a way that's not supported 0:06:24.279 --> 0:06:26.400 by revenues. And at the same time, if we look 0:06:26.440 --> 0:06:29.400 at terrorf uncertainty, you know, there's a lot of things 0:06:29.400 --> 0:06:32.200 that go into building out data centers that are expensive 0:06:32.640 --> 0:06:35.560 beyond just in video chips and those kind of things 0:06:35.600 --> 0:06:37.560 have got to be considerations as well as we think 0:06:37.600 --> 0:06:39.960 about the overall data center class structure. 0:06:40.320 --> 0:06:42.520 I'm really interested in that. So we're expecting what eleven 0:06:42.560 --> 0:06:44.960 percent growth in revenue for Microsoft for this fiscal quart 0:06:44.960 --> 0:06:47.720 to Rebecca, but where are you seeing the weakness and 0:06:47.880 --> 0:06:50.800 ultimate demand for their AI products? Where are we likely 0:06:50.839 --> 0:06:53.440 to see that they're spending a lot but people aren't 0:06:53.440 --> 0:06:55.559 buying a lot when it comes to the Copilot offering, 0:06:55.640 --> 0:06:57.560 and that's being offered to the enterprise. 0:06:58.640 --> 0:06:59.000 Yeah, I know. 0:06:59.040 --> 0:07:01.320 I think if you loot copilot. There have been a 0:07:01.320 --> 0:07:03.200 lot of challenges with adoption and really a lot of 0:07:03.240 --> 0:07:06.400 challenges with Microsoft being able to prove the value of 0:07:06.440 --> 0:07:08.479 what they deliver with Copilot. You know, I think they 0:07:08.480 --> 0:07:11.640 did themselves a disservice putting copilots out there in the 0:07:11.680 --> 0:07:15.920 beginning that weren't necessarily ready for prime time. Customers tried 0:07:15.960 --> 0:07:18.160 them once, didn't get the results they expected, and they're 0:07:18.200 --> 0:07:21.760 hesitant to go back. So now, without that broader picture 0:07:21.760 --> 0:07:26.120 of enterprise data grounding Copilot, Microsoft's struggling with their own 0:07:26.160 --> 0:07:28.920 AI to get it out there and get customers paying 0:07:28.960 --> 0:07:29.200 for it. 0:07:29.400 --> 0:07:32.320 I find this fascinating. Like Caroline, I think we share 0:07:32.320 --> 0:07:32.840 this in common. 0:07:32.920 --> 0:07:33.160 Right. 0:07:34.000 --> 0:07:37.560 I grew up using Microsoft software. It's what was available 0:07:37.880 --> 0:07:40.440 on my Dell desktop at home, and as I've got older, 0:07:40.800 --> 0:07:42.840 I have options I'm now a Mac user and I 0:07:42.960 --> 0:07:45.320 use OS. And the thing that I'm always reminded of 0:07:45.440 --> 0:07:49.640 is that Microsoft has spent many years selling software you 0:07:49.680 --> 0:07:53.200 can otherwise get for free somewhere else. So we're focused 0:07:53.240 --> 0:07:55.600 on their capital expenditures, but I still don't see the 0:07:55.600 --> 0:07:58.120 other side of it. The idea that you can look 0:07:58.160 --> 0:08:00.120 at Copilot and say, I'm going to pay at the 0:08:00.240 --> 0:08:02.480 enterprise level was just me personally for that and get 0:08:02.520 --> 0:08:06.200 good value? Is that kind of what you're saying here, Rebecca, Yeah, I. 0:08:06.200 --> 0:08:09.400 Think we're seeing customers say, when I can go out 0:08:09.440 --> 0:08:12.360 to chat GPT on my own, right, why am I 0:08:12.400 --> 0:08:15.640 paying Microsoft for that capability? If it's not grounded in 0:08:15.800 --> 0:08:18.640 enterprise data? And if you in contrast at some of 0:08:18.680 --> 0:08:22.360 Microsoft's competitors in the enterprise software space, you've got your Oracles, 0:08:22.360 --> 0:08:25.000 your Service, and now your salesforces where they're saying it's 0:08:25.000 --> 0:08:28.360 not just what's on your desktop that's important for Copilot 0:08:28.680 --> 0:08:31.400 or for any sort of AI agent, but what's in 0:08:31.440 --> 0:08:35.360 those enterprise data sources you're helping to create more context, 0:08:35.440 --> 0:08:38.400 to give better answers, to give better recommendations, to really 0:08:38.480 --> 0:08:39.600 have more intelligent AI. 0:08:39.920 --> 0:08:42.360 What we're forgetting about is that Azure is the number 0:08:42.360 --> 0:08:45.320 two player in cloud. And so if everyone is out 0:08:45.360 --> 0:08:49.200 there spending on AI through the application layer like Salesforce, 0:08:49.240 --> 0:08:51.760 all those names, doesn't Microsoft just win anyway? 0:08:53.040 --> 0:08:58.240 Well? Absolutely, I mean Microsoft wins when it's competitor's AI win. Right. 0:08:58.280 --> 0:09:01.200 If you look at the folks that are running on 0:09:01.720 --> 0:09:05.600 Azure today, whether it's Service Now or Genesis day Force, 0:09:05.760 --> 0:09:09.720 tons of folks are those spending that their customers are 0:09:09.720 --> 0:09:12.480 spending on their AI or driving up Azure credits. 0:09:13.440 --> 0:09:16.800 Where is therefore the weakness that we might see in 0:09:16.840 --> 0:09:20.320 this particular quarter and the guidance going forward, the small 0:09:20.360 --> 0:09:21.320 exposure to hardware. 0:09:21.520 --> 0:09:23.280 We think about the gaming side, but. 0:09:23.320 --> 0:09:25.640 Ultimately tariffs, is it going to be an economic a 0:09:25.720 --> 0:09:28.480 macroeconomic impact that we want to hear from Satya that 0:09:28.480 --> 0:09:30.600 we want to hear from Amy as well. When we 0:09:30.600 --> 0:09:33.360 think about the CFO perspective, I think. 0:09:33.280 --> 0:09:35.680 The macropipiece is going to be really big Caroline, because 0:09:35.679 --> 0:09:40.320 as we think about overall slowing of enterprise purchases that's 0:09:40.360 --> 0:09:43.360 already happening right, The question is how long is it 0:09:43.440 --> 0:09:46.520 going to last? And how much can the innovation that 0:09:46.559 --> 0:09:49.680 Microsoft is driving in AI in areas help it to 0:09:49.760 --> 0:09:52.160 catch up in terms of sort of capturing the imagination 0:09:52.240 --> 0:09:55.920 of customers. And when we're all risk averse and hesitant 0:09:55.960 --> 0:09:59.880 about making decisions, it's tough to spark that imagination. 0:10:00.040 --> 0:10:02.280 Spin that forward with Amazon, right you know, it's it's 0:10:02.400 --> 0:10:05.839 fast and furious. For forty eight hours, AWS is the 0:10:05.920 --> 0:10:09.760 number one player in cloud computing. All of the logic 0:10:09.800 --> 0:10:12.160 you've just outlined. What do you expect to be your 0:10:12.200 --> 0:10:14.080 conclusion by Friday morning. 0:10:13.920 --> 0:10:17.840 Of this week? Sorry, you know my cool question, but 0:10:18.120 --> 0:10:18.480 have a go. 0:10:19.640 --> 0:10:21.880 Well, you know, if I had the perfect answer, I 0:10:21.880 --> 0:10:23.960 wouldn't be on the show, and I'd be somewhere else 0:10:24.000 --> 0:10:26.160 on a boat, But you'd always be on this show. 0:10:27.400 --> 0:10:30.319 You'd always be coming back on giving us your expertise, 0:10:30.360 --> 0:10:32.360 no matter how many billions you have on that boat. 0:10:33.360 --> 0:10:36.839 That's right, you know, I think we're going to see 0:10:37.679 --> 0:10:41.520 in general, slowly growth. Amazon has some different pieces towards 0:10:41.520 --> 0:10:44.600 growthfolio that are very compelling for customers that are looking 0:10:44.640 --> 0:10:48.040 at cost cutting measures, that are looking at streamlining and rationalization. 0:10:48.160 --> 0:10:51.000 Right now, Amazon has a lot to offer in that area. 0:10:51.320 --> 0:10:53.520 You know, we see Microsoft Azure. I think we'll still 0:10:53.559 --> 0:10:57.400 see pretty strong growth there, but it's going to slow 0:10:57.440 --> 0:10:59.040 over the next couple of quarters. And I think what 0:10:59.080 --> 0:11:02.480 we'll see this week is sort of the beginning of 0:11:02.520 --> 0:11:05.680 that sign of if you don't have a compelling cost 0:11:05.760 --> 0:11:09.920 cunning rationalization proposition, like we saw, for example, from Service 0:11:09.920 --> 0:11:12.960 Now last week, you're going to struggle. It's as one 0:11:13.000 --> 0:11:13.680 of the big players. 0:11:13.960 --> 0:11:16.160 Rebecca's great to have you on, even if you're not 0:11:16.200 --> 0:11:19.400 on a boat. Rebecca Wetterman, see principal at Valoir. We 0:11:19.480 --> 0:11:22.520 appreciate it. Now coming up Snap, it wants the headwinds 0:11:22.600 --> 0:11:25.040 impacting its AD business more on the details next. We're 0:11:25.080 --> 0:11:32.120 down by fifteen percent. This is Bloomberg Technology. 0:11:36.679 --> 0:11:37.920 Look Snap's numbers. 0:11:38.040 --> 0:11:41.559 They actually narrowly beat expectations from analysts for the first 0:11:41.640 --> 0:11:44.520 quarter in terms of revenue, but they declined to issue 0:11:44.520 --> 0:11:46.480 a sales forecast for the current period and they say 0:11:46.480 --> 0:11:48.520 they're navigating macroeconomic headwinds. 0:11:49.120 --> 0:11:50.720 It's all about the ad business. 0:11:50.720 --> 0:11:53.200 We're seeing the worst drop since August twenty twenty four 0:11:53.240 --> 0:11:55.800 on the stock Emarketers. Senior analyst Minne Smiley is with 0:11:55.880 --> 0:11:59.040 us for more. And it looks like Chinese retailers, for example, 0:11:59.080 --> 0:12:01.800 are already holding back spending on Snap haats. 0:12:02.240 --> 0:12:04.840 Yes, exactly, there are already holding back spend, and I 0:12:04.840 --> 0:12:06.600 think in their earnings call they did say that that's 0:12:06.640 --> 0:12:09.680 partly why they're you know, delaying issuing any guidance. 0:12:09.720 --> 0:12:10.720 They are worried about that. 0:12:11.000 --> 0:12:13.720 And I think just overall, the issue with Snap is 0:12:13.720 --> 0:12:16.240 it it's one of those businesses where when we start 0:12:16.280 --> 0:12:18.920 to see these advertiser pullbacks, you know, pullbacks and spend 0:12:19.040 --> 0:12:21.559 pauses and spend, platforms like Snap end up taking a 0:12:21.679 --> 0:12:22.120 hit first. 0:12:22.120 --> 0:12:23.640 You know, advertisers want to put their. 0:12:23.559 --> 0:12:26.880 Money into Meta, into TikTok, into Google, into platforms that 0:12:26.920 --> 0:12:29.720 are just more you know, bigger, more proven, and so 0:12:30.080 --> 0:12:32.160 I think we're already seeing Snap feel the impact. 0:12:32.480 --> 0:12:33.560 But you know, pretty early on. 0:12:33.880 --> 0:12:36.240 It's why it's in our calendar, right because apart from Google, 0:12:36.280 --> 0:12:38.079 we always talk about how well Snap goes first and 0:12:38.120 --> 0:12:40.800 then we extrapolate out to Meta in its platforms. I 0:12:40.800 --> 0:12:44.520 haven't used Snap since high school, frankly, but Caro's intro 0:12:44.720 --> 0:12:47.160 summed it up perfectly, like, you don't give guidance, that's 0:12:47.200 --> 0:12:51.400 a market thing. The platform is growing, Yes, what can 0:12:51.440 --> 0:12:53.760 you tell us about your reaction to that and where 0:12:53.800 --> 0:12:56.679 you see it doing well against those other platforms? 0:12:56.840 --> 0:12:57.400 Yeah, for sure. 0:12:57.400 --> 0:12:59.360 I mean, all in all Snap had a good quarter. 0:12:59.400 --> 0:13:01.360 I mean all of its major metrics. You know, it 0:13:01.440 --> 0:13:03.400 saw user growth, it saw ad revenue and growth. It's 0:13:03.400 --> 0:13:05.600 our revenue growth, which really speaks to the fact that 0:13:05.640 --> 0:13:07.600 it has done a good job of investing in its 0:13:07.600 --> 0:13:11.000 ad platform over the past few years. Its subscription business 0:13:11.000 --> 0:13:13.680 remains small, but it's becoming a meaningful portion of revenue 0:13:13.920 --> 0:13:16.400 for the company. So yes, they are seeing growth, but 0:13:16.440 --> 0:13:18.360 I think we're now seeing that growth maybe kind of 0:13:18.360 --> 0:13:20.640 have within a silo in Q one. I think for 0:13:20.679 --> 0:13:22.960 the remainder of the year, things might get shaky for 0:13:23.000 --> 0:13:25.240 them as they kind of balance, you know, all the 0:13:25.800 --> 0:13:28.560 economic uncertainly we're facing. But you know, the actual core 0:13:28.640 --> 0:13:31.319 business does show some some pretty healthy signs. 0:13:31.480 --> 0:13:34.760 We've been asking our investor in markets guests for about 0:13:34.760 --> 0:13:38.000 a week what happens if a technology company doesn't issue guidance, 0:13:38.400 --> 0:13:42.000 your stock goes down fifteen percent. You know what I'd 0:13:42.000 --> 0:13:45.920 love to help our audience understand is tariffs, trade, uncertainty, 0:13:46.160 --> 0:13:47.240 advertising market. 0:13:47.520 --> 0:13:50.320 Why did the advertisers care? 0:13:51.040 --> 0:13:51.280 Yeah? 0:13:51.320 --> 0:13:52.960 I mean, I think for for a lot of people, 0:13:53.000 --> 0:13:56.040 when they see advertisers spend becoming, you know, starting to 0:13:56.080 --> 0:13:58.400 pull back, it's a sign of bigger bigger concerns, bigger 0:13:58.440 --> 0:14:00.840 issues to come because a lot of marketers, you know, 0:14:01.200 --> 0:14:02.840 for a lot of these companies, one of the first 0:14:02.840 --> 0:14:04.520 things they're going to pull back is marketing when they 0:14:04.520 --> 0:14:08.120 start to see signs of a shaky economy, periods of instability, 0:14:08.559 --> 0:14:11.240 and especially you know when we talk about tariffs, companies 0:14:11.240 --> 0:14:12.960 that might be hit harder by tariffs, you know, maybe 0:14:12.960 --> 0:14:16.719 they have manufacturing in China or whatnot. You know, those companies, retailers, 0:14:16.760 --> 0:14:19.800 you know that maybe rely heavily on other countries. 0:14:20.120 --> 0:14:21.480 They're they're going to have an impact. 0:14:21.480 --> 0:14:24.200 And AD spend always does to kind of take one 0:14:24.240 --> 0:14:26.280 of the first hits when you look across the whole company. 0:14:26.360 --> 0:14:29.000 And so so yeah, these platforms. 0:14:28.680 --> 0:14:31.280 AD revenues are bread and butter, and we talk about 0:14:31.280 --> 0:14:34.200 Snap specifically. They're lucky in that they're you know, because 0:14:34.200 --> 0:14:36.800 they have their subscription subscription business, they are able to 0:14:36.800 --> 0:14:38.760 diversify a little bit. But again, I think it all 0:14:38.800 --> 0:14:41.040 the represents about ten percent of their business right now, 0:14:41.080 --> 0:14:43.320 so of course they're very concerned about AD revenue. 0:14:43.640 --> 0:14:46.480 What blows my mind is that Snap has almost a 0:14:46.560 --> 0:14:50.360 billion users, right but they have a first quarter net 0:14:50.520 --> 0:14:52.320 loss of one hundred. 0:14:52.080 --> 0:14:55.440 And forty million dollars. Just where is the money going? 0:14:55.480 --> 0:14:58.040 What leavers do they have to pull to be a 0:14:58.080 --> 0:15:00.560 long term competitor that actually is profitable. 0:15:00.880 --> 0:15:03.640 Yes, I mean they definitely are running into some issues 0:15:03.680 --> 0:15:07.480 when specifically when you talk about user growth, they are 0:15:07.520 --> 0:15:09.280 seeing user growth here every year, but when you look 0:15:09.280 --> 0:15:10.960 at their key markets, when you look at North America, 0:15:10.960 --> 0:15:12.880 they actually posted declines. I think it went from one 0:15:12.960 --> 0:15:16.920 hundred million two to ninety nine. So they are seeing 0:15:17.000 --> 0:15:19.360 some concerns there around you know this, you know the 0:15:19.400 --> 0:15:22.280 market of the North America, that is their most profitable market, 0:15:23.480 --> 0:15:24.120 but it's saturated. 0:15:24.160 --> 0:15:25.520 They're really struggling to grow there. 0:15:25.600 --> 0:15:27.920 And these and these markets where they are seeing user growth, 0:15:28.000 --> 0:15:29.880 those are the markets where they're not monetizing as well. 0:15:29.920 --> 0:15:31.560 So they definitely have, Like I said. 0:15:31.360 --> 0:15:33.120 They had a good quarter, but they have some big 0:15:33.160 --> 0:15:34.520 long term challenges ahead of them. 0:15:34.640 --> 0:15:37.040 Let's say that there's still a question mark about TikTok 0:15:37.080 --> 0:15:41.200 in the United States, does Snaps stand to benefit from 0:15:41.200 --> 0:15:44.440 that whatever happens with that platform they have that they. 0:15:44.320 --> 0:15:46.240 Do stand the benefit and they have benefited already. 0:15:46.240 --> 0:15:48.360 I mean, I think the uncertainty around TikTok, of course, 0:15:48.400 --> 0:15:49.359 it's its future. 0:15:49.120 --> 0:15:51.480 Is still in flux. But I think just this general. 0:15:51.240 --> 0:15:53.640 Uncertainty that's been happening over the past few years has 0:15:53.680 --> 0:15:56.640 benefited all these other platforms. That being said, I don't 0:15:56.640 --> 0:15:59.520 think Snap will be one of the main beneficiaries we're 0:15:59.520 --> 0:16:01.840 going to see. So that money go to YouTube, you know, 0:16:01.880 --> 0:16:05.120 go to YouTube shorts, go to Instagram, Instagram reels, even Facebook. 0:16:05.240 --> 0:16:07.760 I think Snap, yes, they will benefit, but not so 0:16:07.840 --> 0:16:09.680 much that it'll really kind of, you know, save their 0:16:09.800 --> 0:16:11.080 entire business by any means. 0:16:11.120 --> 0:16:12.840 Okay, what are you watching for with Meta? What do 0:16:12.880 --> 0:16:14.040 we need to know? Oh? 0:16:14.040 --> 0:16:14.280 Wow? 0:16:14.360 --> 0:16:16.560 I mean in some ways, Meta is actually a similar 0:16:16.560 --> 0:16:18.680 story to Snap in some ways in that you know, 0:16:18.760 --> 0:16:20.520 I think we're expecting a good quarter. They're going to 0:16:20.520 --> 0:16:22.640 post advertising growth. You know, they're going to kind of 0:16:22.680 --> 0:16:24.520 buy all their major metrics. We're going to see growth. 0:16:24.560 --> 0:16:26.880 But between the anti trust try all their facing here 0:16:26.880 --> 0:16:29.720 in the US, between tear ups, and especially for Meta, 0:16:29.800 --> 0:16:32.480 I mean, they will be impacted by Chinese retailers like 0:16:32.480 --> 0:16:34.240 She and Timu pulling back on D spend. 0:16:34.440 --> 0:16:36.760 That's going to hit them pretty hard, we expect. 0:16:37.240 --> 0:16:39.600 And so yeah, they they're probably going to post a 0:16:39.680 --> 0:16:42.520 good quarter, But I think there's going to be some 0:16:42.520 --> 0:16:44.600 some issues people will be paying attention to for sure 0:16:44.680 --> 0:16:45.800 in the quarters to come. 0:16:46.000 --> 0:16:48.280 EMOCS the senior analyst mind the Smiley Greats having on 0:16:48.320 --> 0:16:58.320 the show, Thank you righte Hailing and food delivery company 0:16:58.320 --> 0:17:02.160 GRAB Holdings raised it's all year earnings forecast, boosting sentiment 0:17:02.400 --> 0:17:05.200 that the sector could be more resilient amid global trade 0:17:05.200 --> 0:17:07.800 wars for more delighted to say, we're joined by Peter 0:17:07.880 --> 0:17:09.240 Owey Grab CFO. 0:17:09.840 --> 0:17:11.240 I'm here in the United States. 0:17:11.320 --> 0:17:13.960 Grab is Southeast Asia and everyone that I talked to 0:17:14.560 --> 0:17:18.280 talks about your scale across those different nations and your 0:17:18.359 --> 0:17:21.560 use of AI, particularly to manage operating costs. That's the 0:17:21.560 --> 0:17:25.040 boring stuff, Peter. What is it you're able to do 0:17:25.600 --> 0:17:28.480 in those markets and those Southeast Asian companies at scale 0:17:28.680 --> 0:17:30.159 that's helping you perform like this? 0:17:31.880 --> 0:17:35.040 Yeah, we had a very strong Q one results, record revenues, 0:17:35.119 --> 0:17:38.280 a record number of transacting users on our platform, and 0:17:38.400 --> 0:17:41.760 also a growing profitability in our business today. And what's 0:17:42.000 --> 0:17:44.639 unique about our business is that the scale that we 0:17:44.760 --> 0:17:48.320 built is around adoptability of our products and it's a 0:17:48.440 --> 0:17:51.280 super app. So what does that mean? We have multiple 0:17:51.359 --> 0:17:54.680 products that's on one single app it cell, whether it's 0:17:55.000 --> 0:17:57.680 all forms of deliveries, whether it's food delivery, whether it's 0:17:57.720 --> 0:18:02.080 grocery delivery. You've got transport two wheels, three wheels, four wheels, 0:18:02.520 --> 0:18:05.520 and that's our taxi services also on our platform. 0:18:05.800 --> 0:18:07.880 And we also have fintech also. 0:18:07.800 --> 0:18:12.280 Where there is low appurance payments business also, and it's 0:18:12.480 --> 0:18:15.840 unique in Southeast Asia where all these products are interrelated 0:18:15.880 --> 0:18:19.400 and they're all working through one ecosystem. We're seeing more 0:18:19.520 --> 0:18:23.639 traction before on our platform than ever before. Part of 0:18:24.440 --> 0:18:27.439 product is around affordability, and we continue to push that 0:18:27.640 --> 0:18:29.880 affordability as we expand the user base. 0:18:30.320 --> 0:18:32.200 Okay, so let's talk about affordability. 0:18:32.280 --> 0:18:35.000 Is that coming through the new products, because actually you're 0:18:35.000 --> 0:18:38.160 trying to increase spending from your users. You're doing well, 0:18:38.200 --> 0:18:41.200 whether you're doing family accounts, whether you're offering. 0:18:40.920 --> 0:18:43.320 People to pull some of their deliveries for example. Peter, 0:18:44.520 --> 0:18:44.919 that's right. 0:18:45.040 --> 0:18:47.960 Yes, we're actually adding more products, but those products are 0:18:47.960 --> 0:18:51.399 also catering for segments of users on our platform there 0:18:51.480 --> 0:18:53.600 might be a little bit more pro sensitive. That's why 0:18:53.600 --> 0:18:56.480 we have about a third of our transactions today are 0:18:56.520 --> 0:19:00.240 coming from these more affordable suite of products. In transport 0:19:00.600 --> 0:19:03.560 or own deliveries, or we also have the more the 0:19:03.640 --> 0:19:06.200 premium side also, which are really important for those who 0:19:06.200 --> 0:19:10.000 are less price sensitive, who are less more they wanted 0:19:10.040 --> 0:19:13.080 a food much quicker, for an example, and that's also 0:19:14.080 --> 0:19:16.800 so it's a combination of this product mix that's really 0:19:16.840 --> 0:19:19.680 important and we need to give customers choice and that's 0:19:19.720 --> 0:19:21.880 what we've been doing more and more over the last 0:19:21.960 --> 0:19:23.120 two years in our business. 0:19:23.359 --> 0:19:26.239 It's even so we have a trade war, what are 0:19:26.280 --> 0:19:30.600 the indirect economic impacts of tariffs on those Southeast Asian markets? 0:19:30.680 --> 0:19:33.560 And on the financing side loans, what are you doing 0:19:33.720 --> 0:19:35.280 to insulate yourself. 0:19:36.880 --> 0:19:41.000 Yeah, we've built a business where we feel and we 0:19:41.080 --> 0:19:43.600 believe that it's counter sickly goal. What does that mean 0:19:43.760 --> 0:19:45.439 If you look at the type of service that we 0:19:45.480 --> 0:19:48.679 do today, people still need to eat, and we have 0:19:48.840 --> 0:19:51.920 also an ability where we can bring cook food home 0:19:52.320 --> 0:19:55.280 or we can also get grocery into their homes. So 0:19:55.440 --> 0:19:58.680 at the same time at an affordable price, people still 0:19:58.680 --> 0:20:00.560 need to go to work, they still need to commute 0:20:00.560 --> 0:20:03.320 from point at a point B, and we're making services 0:20:03.359 --> 0:20:06.280 more affordable also at the same time. So we feel 0:20:06.320 --> 0:20:09.800 that whether it's an economic downturn or whether the economy 0:20:09.880 --> 0:20:12.399 is doing well. The services that we have today are 0:20:12.480 --> 0:20:17.119 relevant for these consumers and also with fintech. Also, payments 0:20:17.160 --> 0:20:20.400 also is still very prevalent, whether it is in any 0:20:20.480 --> 0:20:23.680 economic cycles. People need still need to pay for things, 0:20:23.680 --> 0:20:27.880 whether to pay their bills. So it's an important part 0:20:27.920 --> 0:20:30.360 of this ecosystem that we continue to harness. 0:20:30.800 --> 0:20:35.879 Peter and mentioned that potential protection of yourself via taking 0:20:35.920 --> 0:20:38.320 out loans. Now you were taking out alone, we understand 0:20:38.359 --> 0:20:40.800 to the tune of about two billion to help finance potential 0:20:40.880 --> 0:20:43.560 deal go to How is that M and A going 0:20:43.600 --> 0:20:44.640 in this current environment. 0:20:46.359 --> 0:20:49.919 Well, can't command caroline on the speculation of those M 0:20:49.920 --> 0:20:54.280 and A. What we are focusing where especially Indonesia where 0:20:54.320 --> 0:20:56.880 it's a very important market for US. It's about three 0:20:56.920 --> 0:21:00.119 hundred million people and it's a very critical market. What 0:21:00.160 --> 0:21:03.040 we are seeing in Indonesia is a continuing growth. Actually, 0:21:03.040 --> 0:21:05.720 if we look at the number of users quorter on quarter, 0:21:05.760 --> 0:21:09.520 we continue to expand that business margin also is expanding, 0:21:09.800 --> 0:21:12.639 so we can do it on Indonesia. Then we are 0:21:12.800 --> 0:21:15.639 making selective m and as in the first quarter we 0:21:15.720 --> 0:21:17.920 made a number of small M and a's which are 0:21:17.960 --> 0:21:21.200 more around ecosystem and that's really important also as again 0:21:21.240 --> 0:21:24.280 as we bring more products and services, more capabilities to 0:21:24.440 --> 0:21:25.160 our user base. 0:21:25.320 --> 0:21:28.320 Its briefly the cost control you've got, how much is 0:21:28.320 --> 0:21:29.080 that because of AI? 0:21:31.160 --> 0:21:33.280 I would say it's very hard to measure with its 0:21:33.320 --> 0:21:37.280 pinpoint is specifically to AI. What we are measuring is 0:21:37.359 --> 0:21:41.080 more the productivity output that we can harness from using 0:21:41.119 --> 0:21:45.600 AI internally. Here a grab for an example, behalf of 0:21:45.640 --> 0:21:49.119 our engineers today are using some sort of AI assists 0:21:49.119 --> 0:21:51.520 for them to be able to do their work more efficiently. 0:21:52.440 --> 0:21:54.879 I would say that one measurement also is the number 0:21:54.880 --> 0:21:58.040 of headcount that we are increasing also in our organization, 0:21:58.080 --> 0:22:00.439 which actually have slowed down because of some of these 0:22:00.520 --> 0:22:03.000 automation and some of these AI agents that would be 0:22:03.080 --> 0:22:08.320 labeled to deploy email organizations. So measured this productivity p. 0:22:08.440 --> 0:22:10.919 Dewey, I've grabbed. Great to have some time with you 0:22:10.960 --> 0:22:21.000 a long day. Appreciate you coming on. Welcome back to 0:22:21.000 --> 0:22:23.440 Blueberg Technology. I'm Caroline Hider, New York and I met. 0:22:23.400 --> 0:22:24.520 Love Loow right alongside her. 0:22:24.600 --> 0:22:28.440 The market story for the technology sector is anxiety about economics. Really, 0:22:28.760 --> 0:22:31.439 data out of China on the manufacturing side not great 0:22:31.840 --> 0:22:34.399 on US levies and you see the US listed shares 0:22:34.640 --> 0:22:37.879 of Chinese tech companies lower. Another name that I've got 0:22:37.920 --> 0:22:40.240 to point out, Tesla. Morgan Stanley is out with a 0:22:40.359 --> 0:22:43.720 note that the tie up between Waimo, the autonomous driving 0:22:43.800 --> 0:22:49.200 arm of Google, and Toyota is quote legit competition for Tesla, 0:22:49.400 --> 0:22:51.359 the stock under a little pressure there, and we go 0:22:51.480 --> 0:22:55.240 back to Nvidia Caro because Jensen one's on Capitol Hill. 0:22:55.280 --> 0:22:57.800 But also the read through and downward pressure that came 0:22:57.800 --> 0:23:01.240 from super Micro, one of its key manufacturing partners in 0:23:01.240 --> 0:23:02.359 the server design space. 0:23:02.840 --> 0:23:05.119 It is, and let's just stick with all things in video, 0:23:05.160 --> 0:23:07.600 but also all things President Trump. Because marking one hundred 0:23:07.680 --> 0:23:10.199 days ed in office as a rally in Michigan was 0:23:10.240 --> 0:23:13.680 taken out yesterday, he doubled down on his tough stance 0:23:13.720 --> 0:23:16.200 on immigration and the impact of Tara's on China's quote 0:23:16.240 --> 0:23:19.399 unfair trade now moves that sent ripples through the tech industry, 0:23:19.440 --> 0:23:21.600 of course, from supply chains to AI development. Now in 0:23:21.680 --> 0:23:24.000 Vidio CEO Jensen Wang, as you mentioned, ed just joined 0:23:24.000 --> 0:23:26.879 from Washington. He's sounded confident on the administration's tarast stance, 0:23:26.960 --> 0:23:30.119 but sounding the alarm when it comes to China's AI strength. 0:23:31.240 --> 0:23:36.479 China is not behind anybody who's in you. China's right 0:23:36.520 --> 0:23:39.600 behind us. I mean they're more very very close. But 0:23:39.760 --> 0:23:43.200 remember this is a long term. This is an infinite race. 0:23:43.560 --> 0:23:45.680 There is no you know, in the in the world 0:23:45.680 --> 0:23:48.240 of life, there is no those you know, there's no 0:23:48.320 --> 0:23:50.520 two minute here, end. 0:23:50.480 --> 0:23:51.000 Of the quarter. 0:23:51.160 --> 0:23:53.480 There's there's no such thing. And so we're going to 0:23:53.480 --> 0:23:54.520 compete for a long time. 0:23:55.520 --> 0:23:55.760 Murgs. 0:23:55.800 --> 0:23:58.240 Mike Shepherd joins us now a warning for the administration 0:23:58.359 --> 0:23:59.560 that China is close behind. 0:24:00.520 --> 0:24:02.400 Well, that's right, and it's one that he'll be able 0:24:02.440 --> 0:24:06.399 to deliver to the President in person this afternoon in video, 0:24:06.440 --> 0:24:09.440 of course, is one of the featured companies at an 0:24:09.440 --> 0:24:14.119 Investing in America meeting with the President later this afternoon. 0:24:14.440 --> 0:24:17.159 It's a part of the one hundred days in office 0:24:17.160 --> 0:24:20.440 celebration that is really extending over a few days, as 0:24:20.560 --> 0:24:23.199 Trump tries to look back at some of the successes he, 0:24:23.480 --> 0:24:26.879 in his view, has already had since taking office in January, 0:24:26.920 --> 0:24:30.040 and looks ahead to some more of the policy areas 0:24:30.040 --> 0:24:32.840 where they would like to gain ground. AI certainly is 0:24:32.880 --> 0:24:35.800 one of them. We're waiting this AI blueprint from David 0:24:35.840 --> 0:24:38.080 Sachs and others and We're also looking to see how 0:24:38.119 --> 0:24:40.800 the administration will act in a key area of concern 0:24:40.880 --> 0:24:43.960 for Jensen Wong, and that is those export controls on 0:24:44.040 --> 0:24:46.760 AI chips, especially the ones that his company makes. 0:24:46.840 --> 0:24:49.600 Caro probably is Mike Shepperd keeping us on us out 0:24:49.600 --> 0:24:50.399 of Washington, d C. 0:24:50.560 --> 0:24:51.199 Thank you very much. 0:24:51.280 --> 0:24:53.080 Let's get back to what is a top story and 0:24:53.160 --> 0:24:57.639 news overnight of China's President Gee's visit to a tech incubator, 0:24:57.720 --> 0:25:01.919 which sent some robotics stocks soaring. Then there was a 0:25:01.920 --> 0:25:04.640 slump in Chinese manufacturing data in the face of US 0:25:04.720 --> 0:25:07.880 tarrist that's also putting more focus on supply chains four 0:25:07.960 --> 0:25:11.480 key domains like robotics. Here in North America, competition in 0:25:11.560 --> 0:25:14.160 robotics is heating up, and some of that's coming from 0:25:14.240 --> 0:25:18.000 long standing robotics names like Boston Dynamics. Like's say, the 0:25:18.000 --> 0:25:21.399 company's CEO, Robert Plater, joins us. Now, Robert, welcome to 0:25:21.400 --> 0:25:25.520 Bloomberg Technology. Let's actually just start with basic data and facts. 0:25:25.920 --> 0:25:29.560 Where is Boston Dynamics today in its production of robots? 0:25:29.680 --> 0:25:31.679 Where does it take place? And what does the supply 0:25:31.760 --> 0:25:32.320 chain look like? 0:25:34.080 --> 0:25:37.320 Thanks for having me ed so, Boston Dynamics is building 0:25:37.400 --> 0:25:39.480 three products right now and two of them are in 0:25:39.520 --> 0:25:43.280 the market. Spot was our initial product, and we have 0:25:43.480 --> 0:25:46.440 about two thousand of those robots out with customers. We've 0:25:46.520 --> 0:25:49.960 launched a second product stretch, which is a warehousing robot, 0:25:50.080 --> 0:25:53.840 and that's having success with big players like DHL, and 0:25:53.880 --> 0:25:56.960 our third product will be humanoids. We are manufacturing all 0:25:57.000 --> 0:26:00.880 of these in the United States and to deploy them 0:26:01.840 --> 0:26:04.120 internationally as well as in the United States. 0:26:04.680 --> 0:26:06.679 Robert I always like to go to our audience on 0:26:06.720 --> 0:26:09.159 social media and say, the following CEO is coming on 0:26:09.200 --> 0:26:10.679 the show, what would you ask them? And based on 0:26:10.720 --> 0:26:13.000 what you just said, the first customer was if you 0:26:13.280 --> 0:26:16.200 are approaching a new customer, how would you go about 0:26:16.240 --> 0:26:19.080 a new task, What does the teaching process for the 0:26:19.119 --> 0:26:21.399 specific form facts of robot look like? And how long 0:26:21.440 --> 0:26:24.080 does it take to go from sort of inception to 0:26:24.160 --> 0:26:26.119 deployment in that industrial use case. 0:26:27.119 --> 0:26:28.600 That's a great question. 0:26:28.640 --> 0:26:30.480 Thank you. I didn't think of it any with someone 0:26:30.480 --> 0:26:31.399 else's go ahead. 0:26:32.600 --> 0:26:35.920 AI has definitely changed the game here and it's accelerated 0:26:35.920 --> 0:26:37.399 the rate at which you can teach. 0:26:37.200 --> 0:26:38.320 Robots new tasks. 0:26:39.200 --> 0:26:41.439 But much of the AI that you need to make 0:26:41.520 --> 0:26:45.399 humanoids successful is still to be built. What we found 0:26:45.520 --> 0:26:48.639 practically is that when you introduce a new robot like Spot, 0:26:48.920 --> 0:26:51.800 which we introduced in twenty twenty, it took us until 0:26:51.840 --> 0:26:54.960 about twenty twenty three before you really were starting to 0:26:55.040 --> 0:26:58.960 nail the applications that customers wanted and they generated value 0:26:58.960 --> 0:27:02.520 for them. So it's not an overnight activity. It's really 0:27:02.600 --> 0:27:06.560 learning about the customer problem and building a solution, not 0:27:06.640 --> 0:27:07.879 just a prototype robot. 0:27:08.440 --> 0:27:13.200 Let's talk about whether the solution of Optimus over at Tesla. 0:27:13.359 --> 0:27:15.840 Is that a competitive threat for you right now? 0:27:15.920 --> 0:27:18.399 Robert, how realistic do you think the timeframes are on 0:27:18.480 --> 0:27:19.080 that from Elon? 0:27:19.760 --> 0:27:23.880 Well, you know, Elon I think exaggerates often. He's got 0:27:23.960 --> 0:27:27.920 history of doing that, but he's also proven the ability 0:27:27.960 --> 0:27:31.400 to invent the future. So we take Tesla and Optimists 0:27:31.480 --> 0:27:35.560 very seriously. They also share an advantage that Boston Dynamics has, 0:27:35.600 --> 0:27:39.359 which is we're attached to a major automotive manufacturer and 0:27:39.400 --> 0:27:42.679 that creates a unique opportunity for us, but also for 0:27:42.800 --> 0:27:46.320 Tesla to not only build a scale, but deploy at 0:27:46.359 --> 0:27:49.840 scale and basically have consume your own robots. 0:27:50.040 --> 0:27:52.600 I mean, you've got a collaboration with Hyundai for example. 0:27:52.640 --> 0:27:55.640 You've also got partnerships long standing within Video and others. 0:27:55.680 --> 0:27:58.520 Just how resilient to those partnerships and do those end 0:27:58.560 --> 0:28:00.920 customers seem at this economic moment. 0:28:00.760 --> 0:28:03.840 Robert, Well, I think the partnership with Hyundai is going 0:28:03.880 --> 0:28:08.120 to be really amazing because they can be both our 0:28:08.440 --> 0:28:12.399 manufacturer and largest consumer. We can if we need to 0:28:12.440 --> 0:28:16.600 adjust manufacturing of automotives to make robots more successful, there 0:28:16.800 --> 0:28:18.960 we can do so, and that will really be key 0:28:19.000 --> 0:28:23.280 to achieving success. So I think the whole world is 0:28:23.320 --> 0:28:26.920 seeing the opportunity for this new generation of robots to 0:28:28.280 --> 0:28:31.680 expand significantly, and so I think there's just a lot 0:28:31.680 --> 0:28:33.280 of promise in this industry right now. 0:28:33.520 --> 0:28:33.800 Robert. 0:28:33.880 --> 0:28:36.520 The critical line of questioning I get for you, and 0:28:36.560 --> 0:28:39.080 maybe the criticism is that Boston has been at this 0:28:39.160 --> 0:28:42.200 a long time, and the skepticism is that you haven't 0:28:42.200 --> 0:28:45.120 moved beyond prototype phase. You've just said in the opening 0:28:45.160 --> 0:28:47.520 of this interview that actually you have. Would you go 0:28:47.640 --> 0:28:51.240 as actually bear with Robert, I'm afraid to say, We've 0:28:51.240 --> 0:28:53.200 got to leave it here for a second. The President 0:28:53.360 --> 0:28:57.560 is hosting a cabinet meeting in Washington, DC, and the 0:28:57.640 --> 0:28:58.440 right people. 0:28:58.680 --> 0:29:02.640 Working at Congratulations by the way, into tom for two 0:29:02.680 --> 0:29:05.360 months in a row. We have set the all time 0:29:05.440 --> 0:29:09.000 records for the lowest number of illegal border crossings ever recorded. 0:29:09.480 --> 0:29:13.440 The number of illegal boat crosses released into the United States. 0:29:13.080 --> 0:29:19.719 Is down ninety nine point nine percent. That is usually 0:29:20.760 --> 0:29:21.640 one hundred percent. 0:29:22.560 --> 0:29:27.560 So I think it's an amazing tribute, and Christy, congratulations. 0:29:26.640 --> 0:29:27.920 And Tom and everybody else. 0:29:27.960 --> 0:29:31.600 It's an amazing job actually, and it was done very quickly. 0:29:32.160 --> 0:29:35.760 We officially designated trend de Iragua MS thirteen and the 0:29:35.840 --> 0:29:41.800 Mexican drug cartels is foreign terrorist organizations and we're expelling 0:29:41.880 --> 0:29:46.600 these monsters from our country rapidly and working with the 0:29:46.640 --> 0:29:47.680 Department of Justice. 0:29:47.720 --> 0:29:50.400 Pam, You're doing fantastic. Your people are amazing. 0:29:50.880 --> 0:29:56.360 We're having some judge problems and everybody's reading some judges 0:29:56.400 --> 0:29:59.360 that don't like, you know, killers, murderers being thrown out 0:29:59.400 --> 0:30:01.520 of the country. So I don't know what their problem is, 0:30:01.560 --> 0:30:04.520 but we have a little difficulty. We won on the 0:30:04.560 --> 0:30:08.160 basis of a great border and of getting criminals out 0:30:08.200 --> 0:30:11.880 of our country. That was why we won every swing state. 0:30:12.440 --> 0:30:16.600 We won by millions of votes. We won everything, every metric, 0:30:16.680 --> 0:30:19.000 We won by a lot. It was a massive victory 0:30:19.040 --> 0:30:22.600 and we won I think largely because of this issue. 0:30:22.760 --> 0:30:26.240 I put this issue, it's number one issue, and they 0:30:26.400 --> 0:30:28.560 don't want us to do what we're supposed to do. 0:30:28.640 --> 0:30:30.320 And I don't think that can be I hope the 0:30:30.360 --> 0:30:34.360 Supreme Court is going to fully understand what's going on. 0:30:34.720 --> 0:30:36.720 We have to get the criminals out of our country, 0:30:36.760 --> 0:30:39.640 and that's the basis under which we won the election. 0:30:40.160 --> 0:30:43.560 Core gdpked and this is you know, you brobably saw 0:30:43.680 --> 0:30:46.000 some numbers today and I have to start off, I 0:30:46.080 --> 0:30:49.479 say that's Biden, that's not Trump, because we came in 0:30:49.520 --> 0:30:52.920 on January just a quarterly numbers, and we came in 0:30:53.200 --> 0:30:59.400 and I was very against everything that Biden was doing 0:30:59.440 --> 0:31:02.400 in terms of the economy, destroying our country in so 0:31:02.480 --> 0:31:03.240 many ways, not. 0:31:03.160 --> 0:31:03.880 Only at the border. 0:31:03.920 --> 0:31:06.920 The border was more obvious, but we took over his 0:31:07.320 --> 0:31:09.200 mess in so many different ways. 0:31:09.640 --> 0:31:11.840 Core GDP removing. 0:31:11.760 --> 0:31:17.200 Distortions from imports, inventories, and government spending was up close 0:31:17.320 --> 0:31:21.360 three percent when you edit, we had numbers that despite 0:31:21.560 --> 0:31:23.720 what we were handed, we turned them around, and we 0:31:23.760 --> 0:31:27.680 were getting them really turned around. Gross domestic investment was 0:31:27.720 --> 0:31:31.200 a whopping twenty two percent. Now that is a number 0:31:31.280 --> 0:31:33.800 that people are coming in at numbers. For instance, I 0:31:33.880 --> 0:31:37.160 just walked in IRN sam sub Is now because of 0:31:37.240 --> 0:31:39.960 the tariffs, they're going to build massive facilities in the 0:31:40.040 --> 0:31:40.840 United States. 0:31:41.640 --> 0:31:43.640 If we didn't do the tariffs, they wouldn't be doing that. 0:31:44.280 --> 0:31:46.840 So it takes a little while to get those facilities built. 0:31:46.840 --> 0:31:49.160 But they're coming in with big, big numbers. They're all 0:31:49.200 --> 0:31:52.800 coming in with big numbers. We have more moneys being 0:31:52.840 --> 0:31:55.560 spent than any at any time in the history of 0:31:55.560 --> 0:31:58.719 our country. We're up to close to eight trillion dollars, 0:31:58.760 --> 0:32:02.320 I think I can say, and really it's going to 0:32:02.320 --> 0:32:04.320 be a lot higher than that. Those are just the 0:32:04.320 --> 0:32:05.920 ones that we know about. Eight trillion. 0:32:07.080 --> 0:32:09.160 I'm not going to say, but I don't think. 0:32:09.320 --> 0:32:11.840 I'm not sure if Biden did a trillion for four years, 0:32:11.880 --> 0:32:16.440 one trillions, but we're eight trillion for two months, because 0:32:16.560 --> 0:32:19.560 let's give us a pass. On the first month, we 0:32:19.560 --> 0:32:22.080 were sort of getting a little bit used to things. 0:32:22.440 --> 0:32:25.640 But after two months we have eight trillion dollars. There 0:32:25.640 --> 0:32:28.760 has never been a number like that, and that includes 0:32:28.920 --> 0:32:34.080 chip companies, car companies, every form of manufacturing, high tech companies. 0:32:34.960 --> 0:32:36.560 Nobody's ever seen anything like it. 0:32:36.680 --> 0:32:42.480 So eight trillion dollars, I can talk about gross domestic product, 0:32:42.600 --> 0:32:45.720 gross domestic investment. I can talk about a lot of things, 0:32:45.760 --> 0:32:48.560 but to me, the biggest numbers the kind of numbers 0:32:48.600 --> 0:32:52.040 that are and these people are coming in. Our Secretary 0:32:52.080 --> 0:32:56.200 of Commerce spent the weekend he went down to Arizona 0:32:56.240 --> 0:32:58.280 to see what was happening with the chip the biggest 0:32:58.360 --> 0:33:02.880 chip company in the world, and he said, Howard, he said, you've. 0:33:02.680 --> 0:33:05.120 Never seen anything like it. You want to just describe 0:33:05.120 --> 0:33:05.680 what you saw. 0:33:06.120 --> 0:33:10.160 So they're investing one hundred and sixty five billion dollars 0:33:10.160 --> 0:33:14.600 in eleven hundred acres in Arizona and they're building the 0:33:14.680 --> 0:33:20.120 highest tech chip manufacturing semi conductors and four thousand employees. 0:33:20.440 --> 0:33:25.040 You know American trade craft, right, technicians doing every kind 0:33:25.080 --> 0:33:29.000 of work. The classic foundation of America is building it. 0:33:29.000 --> 0:33:33.040 They have fourteen thousand people. They're expecting forty thousand people to. 0:33:32.960 --> 0:33:35.400 Build the rest of their plants and to employ twenty 0:33:35.440 --> 0:33:37.200 thousand people for the rest of time. 0:33:37.240 --> 0:33:39.480 And it is old driven. You never saw a site 0:33:39.480 --> 0:33:40.400 type and this is. 0:33:40.400 --> 0:33:43.640 Old driven by your tower policies, no chance to be 0:33:43.720 --> 0:33:44.720 happening with having. 0:33:45.760 --> 0:33:48.040 It's going to be about forty percent of the chip 0:33:48.080 --> 0:33:50.480 market from that one section. And this is the biggest 0:33:50.560 --> 0:33:52.840 chip maker they have ninety nine percent of the market. 0:33:53.440 --> 0:33:54.520 They come from Taiwan. 0:33:55.320 --> 0:33:58.200 And unlike the Chip Act, which was done by Biden, 0:33:58.200 --> 0:34:00.400 where they hand everybody billions of dollars, the thing they 0:34:00.440 --> 0:34:02.800 don't need is money. They got plenty of money. What 0:34:02.880 --> 0:34:05.480 they need is an incentive to come in and the tariffs. 0:34:05.760 --> 0:34:08.400 They're building because of the tariffs. If without the tariffs, 0:34:08.440 --> 0:34:11.880 and I'd like to say they're building because of November fifth, 0:34:12.200 --> 0:34:14.080 the election and the tariffs. 0:34:13.640 --> 0:34:15.680 But I'm going to building more blunder. 0:34:15.840 --> 0:34:19.120 They're building because of the tariffs, and November fifth gave 0:34:19.200 --> 0:34:24.040 them the tariffs. So it's amazing when you look and 0:34:24.400 --> 0:34:26.600 these are not companies that go out and say, well, 0:34:26.600 --> 0:34:28.759 we're going to build, we have to go get our financing. 0:34:28.840 --> 0:34:33.600 Let's go like we would in New York. Everybody would look. 0:34:33.680 --> 0:34:35.319 You know, you'd get a building site and then you'd 0:34:35.320 --> 0:34:37.640 look around for money, you look around for financing for 0:34:37.719 --> 0:34:41.040 six months, you'd get your financing, you'd build your building. 0:34:41.080 --> 0:34:43.200 The market would be good, you'd make money. The market 0:34:43.239 --> 0:34:45.040 would be bad, it wouldn't be so pretty. You'd have 0:34:45.080 --> 0:34:45.799 to negotiate. 0:34:45.880 --> 0:34:46.560 Bab bab bob. 0:34:47.080 --> 0:34:49.200 This is different. These people have so much money they 0:34:49.239 --> 0:34:52.359 don't know what to do. They are asked, howard did 0:34:52.360 --> 0:34:54.960 they finance it? No, they do it through cash, and 0:34:55.000 --> 0:34:57.880 they stay that site. And they just started, you know, 0:34:58.280 --> 0:35:01.080 they just announced it like a month ago and they've 0:35:01.080 --> 0:35:01.800 already started. 0:35:01.840 --> 0:35:04.040 He said, I've never seen a sight like it's so big. 0:35:04.800 --> 0:35:07.360 So you know, you're talking about a fifty essentially a 0:35:07.400 --> 0:35:08.800 fifty billion dollar building. 0:35:08.840 --> 0:35:09.560 Now, if you built a. 0:35:09.480 --> 0:35:12.640 Warehouse for fifty million dollars, that's a big warehouse gotten, 0:35:13.440 --> 0:35:16.520 but a fifty billion dollar building, that's a lot. 0:35:16.600 --> 0:35:17.120 They're building. 0:35:17.160 --> 0:35:20.719 The electric they're building, They've become a utility, and I'm 0:35:20.760 --> 0:35:22.799 giving him the right to become. They're going to build 0:35:22.800 --> 0:35:25.600 their own electric They're going to build their own electricity, 0:35:25.640 --> 0:35:27.680 which they need tremendous amounts of electricity. 0:35:27.760 --> 0:35:29.040 They're gonna build it themselves. 0:35:29.480 --> 0:35:32.600 Anything they have looked, you know, left over, they'll hook 0:35:32.680 --> 0:35:35.480 that into the grid. But the grid is old and 0:35:35.480 --> 0:35:38.480 they're unreliable, and bad things can happen to grids. I said, 0:35:38.480 --> 0:35:40.920 if you want, you can hook into the grid, but 0:35:41.440 --> 0:35:44.440 that's a little bit risky, or you can build your 0:35:44.480 --> 0:35:45.279 own electricity. 0:35:45.280 --> 0:35:46.000 Have become your. 0:35:45.920 --> 0:35:49.719 Own utility, and they, I think in all cases, are 0:35:49.760 --> 0:35:50.759 deciding to do that. 0:35:51.400 --> 0:35:53.840 So it's very exciting and we have a lot of 0:35:53.880 --> 0:35:54.520 things going. 0:35:55.560 --> 0:35:58.680 We took over on January twenty of these are quarterly reports. 0:35:58.719 --> 0:36:02.959 We took over on January twentieth. The tariffs haven't kicked 0:36:02.960 --> 0:36:05.200 in yet. I know that, and I don't want this 0:36:05.320 --> 0:36:07.960 to happen, but I know that China is doing very 0:36:08.000 --> 0:36:11.040 poorly right now. I just saw some reports coming out, 0:36:11.080 --> 0:36:12.720 and I don't want that to happen to China. 0:36:12.880 --> 0:36:13.440 I like the. 0:36:13.440 --> 0:36:17.000 President a lot. President she, I don't want it to happen. 0:36:17.000 --> 0:36:20.120 I was actually sanden to hear it. But they are 0:36:20.160 --> 0:36:25.880 getting absolutely hammered in China. And you know, they're sending boats, 0:36:25.880 --> 0:36:30.080 the biggest boats in the world, carrying cargo like nobody's 0:36:30.120 --> 0:36:32.319 ever seen before. These are the biggest boats in the world, 0:36:32.360 --> 0:36:35.040 biggest cargo ships in the world, and they're coming and 0:36:35.040 --> 0:36:38.040 they're turning around in the Pacific Ocean. They're doing a 0:36:38.040 --> 0:36:40.880 big u turney going back because they don't want to 0:36:41.000 --> 0:36:44.080 do this because one hundred and forty five percent tariff. 0:36:44.160 --> 0:36:45.960 But at a certain point, I hope we're going to 0:36:46.320 --> 0:36:48.440 make a deal with China. We're talking to China, but 0:36:48.440 --> 0:36:51.839 their factories are closing all over China because we're not. 0:36:51.760 --> 0:36:54.160 Taking their product. We don't want their product. 0:36:54.160 --> 0:36:55.880 Unless they're going to be fair with us, and that 0:36:55.920 --> 0:36:58.600 includes intellectual property and other things. There are a lot 0:36:58.640 --> 0:37:02.319 of things far beyond just by sell. So we'll see 0:37:02.320 --> 0:37:05.520 what happens. But you know I was not because somebody said, well, 0:37:05.520 --> 0:37:07.360 were you happy? I said, I am not happy. I 0:37:07.360 --> 0:37:09.800 want you on it to do well. I want every 0:37:09.840 --> 0:37:12.640 country to do well, but they have to treat us 0:37:12.680 --> 0:37:13.360 fairly also. 0:37:13.520 --> 0:37:15.759 So with that, I think we're going to maybe go 0:37:15.840 --> 0:37:21.120 around and we have some letters where the secretaris and 0:37:21.239 --> 0:37:25.160 people around the table are making statements about how they're 0:37:25.200 --> 0:37:27.960 doing and what's happening. And I could start with Pete 0:37:28.480 --> 0:37:32.040 on the left, because he's my least controversial person. 0:37:31.840 --> 0:37:35.719 At the world. I don't know how good he is. 0:37:36.320 --> 0:37:38.560 So we'll go around the table and you can hear it. 0:37:38.600 --> 0:37:41.879 And these are cabinet meetings where they're very open and transparent, 0:37:41.960 --> 0:37:44.600 and I can guarantee you Biden didn't do this. 0:37:45.200 --> 0:37:47.600 He didn't do this. Go ahead, be well, mister president. 0:37:47.960 --> 0:37:50.000 I think we're controversial because we're over the target. 0:37:50.880 --> 0:37:54.000 And like so many things, mister President, you inherited a 0:37:54.040 --> 0:37:55.520 demoralized military. 0:37:55.640 --> 0:37:56.480 It couldn't recruit. 0:37:56.880 --> 0:37:59.400 It was perceived as weak after what happened in Afghanistan 0:37:59.480 --> 0:38:02.120 and elsewhere because of Joe Biden, and what we have 0:38:02.200 --> 0:38:05.479 seen since your election and the inauguration has been nothing 0:38:05.480 --> 0:38:06.920 short of a recruiting renaissance. 0:38:09.280 --> 0:38:09.840 Decades. 0:38:09.920 --> 0:38:12.200 It has been been decades since we've seen this kind 0:38:12.239 --> 0:38:13.359 of recruiting in the. 0:38:13.400 --> 0:38:15.400 Army, the Navy, the Marine Corps, the Air Force. 0:38:15.719 --> 0:38:18.239 The men and women of America want to join the 0:38:18.320 --> 0:38:22.080 United States military led by President Donald Trump, and the police, 0:38:22.239 --> 0:38:23.960 by the ways, and fire. 0:38:24.360 --> 0:38:26.600 I always mentioned the fire, but the police and fire. 0:38:26.719 --> 0:38:29.839 But the police and fire likewise are I mean they 0:38:29.840 --> 0:38:32.360 have waiting lists now and six months ago as a 0:38:32.400 --> 0:38:33.160 disaster of. 0:38:33.200 --> 0:38:37.160 Truly historic we can barely absorb the volume and retention 0:38:37.280 --> 0:38:39.640 as well, men and women in the military who don't 0:38:39.640 --> 0:38:42.200 want to get out now that they have a real commander, 0:38:42.200 --> 0:38:45.239 a chief. We're reinforcing standards. We're going to be fit, 0:38:45.840 --> 0:38:49.600 not fat in our formations. Welcome back all the COVID 0:38:50.040 --> 0:38:53.200 The folks that were forced out because of the COVID mandate, 0:38:53.960 --> 0:38:55.320 ripped woiteness. 0:38:54.840 --> 0:38:58.440 Out of the military, Star DEI trans. 0:38:57.840 --> 0:39:02.040 And it's Fort Benning and were bragg again at the 0:39:02.120 --> 0:39:04.600 DoD We're rebuilding the military SERP. 0:39:04.880 --> 0:39:08.320 The Golden Dome is well under way. F forty seven. 0:39:08.480 --> 0:39:10.320 Reassuring allies and deterring enemies. 0:39:10.440 --> 0:39:13.680 We found nearly President Trump in a cabinet meeting. We 0:39:13.800 --> 0:39:17.080 leave it on Peter hag Seth, of course, talking about defense, 0:39:17.200 --> 0:39:20.240 but so much said when it comes to the GDP figure, 0:39:20.280 --> 0:39:23.520 for example, and Trump blaming perhaps the decline that we've 0:39:23.520 --> 0:39:25.560 seen the worse since twenty twenty two, on what he 0:39:25.600 --> 0:39:28.640 inherited from the Biden administration, talking about core GDP actually 0:39:28.719 --> 0:39:31.120 being up, taking a while to get domestic facilities built. 0:39:31.239 --> 0:39:32.280 He went to Howard Luckneck. 0:39:32.320 --> 0:39:35.000 Of course, the comments secretary talking about the TSMC investment 0:39:35.000 --> 0:39:37.600 in Arizona, Key and Tech. Also is the fact that 0:39:37.640 --> 0:39:40.440 tarifs haven't yet kicked in, he says, And they know 0:39:40.480 --> 0:39:43.200 that China is currently doing very poorly, but he wants 0:39:43.280 --> 0:39:46.359 China to do well. Let's get the analysis me leg 0:39:46.440 --> 0:39:48.960 Kayly Lions is joining us. And what's so interesting about 0:39:48.960 --> 0:39:51.239 that core GDP number that he says, I'm assuming he's 0:39:51.239 --> 0:39:53.600 trying to reflect the final sales of domestic purchases or 0:39:53.640 --> 0:39:57.160 GDP based excluding inventory or international trade. But this is 0:39:57.200 --> 0:40:00.319 all about international trade implications acts. 0:40:00.480 --> 0:40:03.120 That's exactly right, Caroline, and he referred to that surge 0:40:03.160 --> 0:40:05.640 we saw in imports, which of course detracted from GDP 0:40:05.760 --> 0:40:08.000 as just being a distortion, kind of echoing what we 0:40:08.040 --> 0:40:10.640 heard from his trade advisor Peter Navarro that said, this 0:40:10.680 --> 0:40:13.120 is the best negative GDP print he's ever seen because 0:40:13.120 --> 0:40:15.800 it shows that countries want to sell to the US. 0:40:15.840 --> 0:40:17.840 Although another way of reading the data, of course, is 0:40:17.880 --> 0:40:21.240 that US companies are d really trying to get everything 0:40:21.280 --> 0:40:23.920 they can from other countries in before the tariffs fully 0:40:23.960 --> 0:40:26.040 take effects. So clearly the White House trying to spin 0:40:26.160 --> 0:40:28.440 this as still being the Biden economy, or, as President 0:40:28.480 --> 0:40:30.719 Trump said earlier, the Biden stock market, although he has 0:40:30.800 --> 0:40:33.600 now passed a hundred days in office. As he makes 0:40:33.600 --> 0:40:36.040 his way though calling on different sec secretaries in the 0:40:36.040 --> 0:40:38.560 Cabinet around the table, it'll be interesting to hear from 0:40:38.600 --> 0:40:41.319 the Treasury Secretary, Scott Besson, in particular around what we 0:40:41.440 --> 0:40:44.200 just heard from the President on China, a suggestion that 0:40:44.239 --> 0:40:46.480 he does want to make a deal and that talks 0:40:46.520 --> 0:40:48.759 are happening. The White House has repeatedly said this, even 0:40:48.800 --> 0:40:52.880 though China maintains that no negotiations have actually begun, so 0:40:52.880 --> 0:40:54.640 we'll see if we get a status update from beston 0:40:54.719 --> 0:40:57.080 on that or on other deals. Keeping in mind of 0:40:57.120 --> 0:41:00.080 course that uh, the ninety day window is rapidly shrinking, 0:41:00.120 --> 0:41:02.440 and they are trying to bring on short investment to 0:41:02.440 --> 0:41:04.680 the United States in that time, or at least get 0:41:04.719 --> 0:41:07.880 commitments from companies. He was referring to that as domestic 0:41:07.920 --> 0:41:10.720 facilities taking a while to be built. But the TSMC 0:41:11.120 --> 0:41:13.760 call out in particular interesting to hear from the Commerce 0:41:13.800 --> 0:41:16.520 Secretary and the President because those are actually investment pledges 0:41:16.520 --> 0:41:20.880 that were initially made during the Biden administration. TSMC received 0:41:20.880 --> 0:41:23.719 money from the Chips Act in order to build those 0:41:23.719 --> 0:41:26.279 facilities in Arizona. And yes, a new facility has just 0:41:26.320 --> 0:41:29.000 broken ground, so an expansion of what we saw during 0:41:29.040 --> 0:41:31.640 the Biden years, but it is still worth noting where 0:41:31.680 --> 0:41:35.279 that investment initially came from, so we may hear more 0:41:35.280 --> 0:41:37.240 about that. Keeping in mind as well that President Trump 0:41:37.320 --> 0:41:39.680 is expected to speak from the White House again later 0:41:39.680 --> 0:41:42.279 today four pm Eastern Time for a speech that's being 0:41:42.320 --> 0:41:44.080 built about investment in America. 0:41:44.640 --> 0:41:47.840 Katie lines, we appreciate it wrapping up for us. Meanwhile, 0:41:47.840 --> 0:41:49.879 we've got plenty more happening in Washington, and A Marie 0:41:49.880 --> 0:41:53.640 Hoddan has just been chatting with Palanis CTO Shom Sanka 0:41:53.880 --> 0:41:56.279 early today as part of the Helen Valley Form. Now 0:41:56.280 --> 0:41:58.359 it's a summit focused on how tech com bolston national 0:41:58.360 --> 0:42:01.160 security in the US manufacturing. He discussed his perspective on 0:42:01.200 --> 0:42:04.000 the military industrial complex under Trump administration. 0:42:04.080 --> 0:42:04.640 Just take listen. 0:42:05.719 --> 0:42:07.600 I think this is an opportunity to really fix a 0:42:07.600 --> 0:42:09.600 lot of the problems that have built up over the 0:42:09.640 --> 0:42:11.680 last thirty or so years since the end. 0:42:11.600 --> 0:42:12.239 Of the Cold War. 0:42:12.560 --> 0:42:14.040 If you go back to what it was like, what 0:42:14.280 --> 0:42:15.400 did the industrial base look. 0:42:15.280 --> 0:42:17.000 Like when we were winning World War Two? 0:42:17.239 --> 0:42:21.279 In the early Cold War, it was actually a very 0:42:21.280 --> 0:42:25.200 different economic structure. Chrysler built cars and missiles. We had 0:42:25.239 --> 0:42:27.720 a Deputy Secretary of Defense that was the co founder 0:42:27.719 --> 0:42:30.719 of HP. Bill Perry was the co founder of a 0:42:30.760 --> 0:42:33.600 Silicon Valley startup before he became Secretary of Defense. So 0:42:33.640 --> 0:42:37.680 it's a return to the functioning cross pollination of innovation 0:42:37.760 --> 0:42:40.600 that's always existed and been in the bedrock of how 0:42:40.640 --> 0:42:41.880 the American economy worked. 0:42:42.239 --> 0:42:45.719 Fifty percent of pallanteers revenue comes from government contracts. Do 0:42:45.719 --> 0:42:48.360 you expect that level to stay the same? Will accelerate 0:42:48.440 --> 0:42:49.640 under the Trump administration. 0:42:50.160 --> 0:42:53.320 I think it's been that way for a pretty long time. Obviously, 0:42:53.360 --> 0:42:57.040 we started entirely government. The commercial sector is bigger. It's 0:42:57.040 --> 0:42:59.480 growing very, very rapidly. But I think there's something quite 0:42:59.480 --> 0:43:02.280 healthy about having this diversified R and D base where 0:43:02.680 --> 0:43:05.800 everything we're learning and inventing in the very dynamic American 0:43:05.920 --> 0:43:09.840 private sectors actually benefiting our national security and broader functioning 0:43:09.840 --> 0:43:12.160 of government. You know, we were able to develop and 0:43:12.200 --> 0:43:15.640 deploy the operation Warp speed supply chain in two weeks 0:43:15.640 --> 0:43:17.680 because actually two years prior, we had solved a very 0:43:17.680 --> 0:43:20.480 structurally similar problem for VP and oil and gas. And 0:43:20.520 --> 0:43:23.120 you really cannot connect those dots prospectively. You can only 0:43:23.200 --> 0:43:26.800 see that retrospectively. And that's exactly what happened with SpaceX. 0:43:26.800 --> 0:43:28.440 You know, when I was a kid growing up in 0:43:28.480 --> 0:43:30.200 the shadow of the Space Coast, it used to cost 0:43:30.200 --> 0:43:32.440 fifty thousand dollars a kilogram to get to orbit on 0:43:32.480 --> 0:43:35.840 the Shuttle with Starship heavy reuse. It's now ten to 0:43:35.880 --> 0:43:38.400 twenty bucks. I'm not missing any zeros there, you know. 0:43:38.640 --> 0:43:41.360 It's just wild innovation that comes from that cross palmination. 0:43:41.680 --> 0:43:44.880 This happened with Intel and in the late sixties, ninety 0:43:44.920 --> 0:43:47.880 six percent of Intel's revenue actually came from the Apollo program. 0:43:48.000 --> 0:43:51.520 It was effectively a government contractor. But actually Bob Noys, 0:43:51.600 --> 0:43:53.880 the inventor of the transistor, the CEO of Intel, he 0:43:54.000 --> 0:43:56.640 always had a vision that integrated circuits were going to 0:43:56.680 --> 0:44:00.799 be in every consumer device, and he invested in that 0:44:01.080 --> 0:44:04.279 capability and in the seventies and eighties that enabled us 0:44:04.280 --> 0:44:06.479 to build a salt breaker, which meant that we didn't 0:44:06.520 --> 0:44:08.719 have to match the Soviets weapon for weapon. We could 0:44:08.719 --> 0:44:11.080 actually build smarter weapons and have many fewer of them 0:44:11.080 --> 0:44:13.320 that we could afford and still have deterrence. 0:44:13.800 --> 0:44:16.479 So even if your government revenue comes down, it's because 0:44:16.520 --> 0:44:18.400 you're making money elsewhere in the private sector. 0:44:18.440 --> 0:44:19.720 Yeah, And to be clear, I don't think the revenue 0:44:19.760 --> 0:44:20.880 is going to come down, It's just that they're going 0:44:20.920 --> 0:44:22.239 to be differential growths here. 0:44:22.520 --> 0:44:23.480 Yeah. 0:44:23.640 --> 0:44:26.960 That was Palenteer CTO Scham Sanka along with Bloomberg's A 0:44:27.040 --> 0:44:28.280 Marie Horden Cary. 0:44:28.560 --> 0:44:31.320 I'm coming up investors, I Big Tech Earning said, we 0:44:31.400 --> 0:44:34.080 got Meta, we got Microsoft. They're reporting after the bell 0:44:34.400 --> 0:44:40.880 plenty more on those ahead. That's Bloomberg Technology. 0:44:45.640 --> 0:44:49.280 Turning back to earnings investors eagerly awaiting big tech names 0:44:49.360 --> 0:44:51.920 Meta and Microsoft after the bell and carry like it's 0:44:51.960 --> 0:44:56.160 really a simple equation for Microsoft AI costs capex. It's 0:44:56.200 --> 0:44:58.440 a good story to follow because that's how anyone cares 0:44:58.480 --> 0:44:59.120 about really and. 0:44:59.040 --> 0:45:01.000 Are they sinking to about eight billion? What happens in 0:45:01.040 --> 0:45:04.319 the next year, And what's so interesting is the geopolitical implications. 0:45:04.360 --> 0:45:07.160 You just spotted a Microsoft blog today saying we're still 0:45:07.160 --> 0:45:09.520 expanding our data center footprint in Europe. 0:45:09.760 --> 0:45:12.840 Right They're going to add data centers across sixteen countries, 0:45:12.880 --> 0:45:14.360 they said in this blog post. With the timing of 0:45:14.360 --> 0:45:17.120 it's like very curious. I said to the guests earlier, 0:45:17.320 --> 0:45:19.680 We've all used Microsoft software, m paid for it for 0:45:19.680 --> 0:45:21.799 a long time. And now investors maybe a little bit 0:45:21.840 --> 0:45:24.200 of going like okay, investment. Yeah, but showed me a 0:45:24.200 --> 0:45:26.120 bit of like the end result of all of this. 0:45:26.000 --> 0:45:29.759 And where have analysts and investors reorientated their numbers going 0:45:29.800 --> 0:45:30.239 into this. 0:45:30.320 --> 0:45:32.200 Of course this quarter is not the real tell. It's 0:45:32.200 --> 0:45:32.879 going to be next quarter. 0:45:32.920 --> 0:45:36.439 But Microsoft has sixty five buys on it zero cell. 0:45:37.000 --> 0:45:39.080 Yeah, it's still like the darling of whatever it is 0:45:39.120 --> 0:45:41.799 that's happening in AI. Like Meta also interesting, maybe even 0:45:41.800 --> 0:45:45.120 more straightforward as a story like Google. Yeah, we track 0:45:45.200 --> 0:45:48.000 the capital expenditures. It's a big operator of data centers itself. 0:45:48.200 --> 0:45:51.560 But is its core AD business able to sustain the spending? 0:45:51.880 --> 0:45:54.480 And what about the implications that snapped the read across 0:45:54.520 --> 0:45:58.640 Already sheen already Temu bringing back their spending on ads 0:45:58.719 --> 0:46:02.799 in real time, Will Mark Zuckerberg will seasonally signal that 0:46:03.040 --> 0:46:05.120 for the current quarter we're already in, not just the 0:46:05.160 --> 0:46:06.720 backward looking quarter that they've achieved. 0:46:06.719 --> 0:46:08.640 And very quickly then you remember that in twenty four 0:46:08.680 --> 0:46:10.920 as I was time to go again with Apple and 0:46:10.960 --> 0:46:12.440 Amazon relentless. 0:46:12.040 --> 0:46:14.960 Ye brace yourself. And I'm so pleased that he sat 0:46:15.040 --> 0:46:17.480 right next to me here in New York. Meanwhile, that 0:46:17.480 --> 0:46:19.359 does it for this edition of Blue Meg Technology. Don't 0:46:19.360 --> 0:46:21.200 forget to check out our podcast. Find it on the 0:46:21.280 --> 0:46:24.520 terminal as well as online on Apple, Spotify, and iHeart 0:46:24.920 --> 0:46:26.880 from New York for the next couple of days. 0:46:27.160 --> 0:46:28.320 This is Blue Meg Technology.