WEBVTT - Salesforce, Figma Decline After Earnings 0:00:02.520 --> 0:00:13.239 Bloomberg Audio Studios, Podcasts, radio news. Bloomberg Tech is a 0:00:13.320 --> 0:00:17.080 live from Coast to Coast with Caroline Hide in New 0:00:17.160 --> 0:00:19.640 York and Va Lowe in Sentrancisco. 0:00:22.800 --> 0:00:26.160 This is Bloomberg Tech coming up. Salesforce sell off as 0:00:26.239 --> 0:00:30.400 lackluster top line growth forecast suggests AI isn't paying. 0:00:30.120 --> 0:00:30.840 Off just yet. 0:00:30.920 --> 0:00:32.240 Plus, Apple plans. 0:00:31.920 --> 0:00:34.159 To up its AI game with a web search for 0:00:34.240 --> 0:00:37.560 Siri as it leans towards Google's Gemini for its next 0:00:37.640 --> 0:00:39.360 gen voice assistant. 0:00:39.640 --> 0:00:43.200 An HPE, where there's a profit squeeze as AI hits 0:00:43.240 --> 0:00:45.680 the server maker's margins despite demand. 0:00:46.040 --> 0:00:48.080 First, let's take a look at the broader markets. 0:00:48.080 --> 0:00:49.960 You're going to dig into the details of these earnings. 0:00:50.040 --> 0:00:52.000 Z I look at a context that it's up three 0:00:52.120 --> 0:00:56.080 ten percent on the NASDAG. We are digesting pretty woful 0:00:56.120 --> 0:00:58.560 labor data once more, but all eyes on the FED 0:00:58.600 --> 0:01:01.320 to cut ninety chance the money markets that there will 0:01:01.320 --> 0:01:04.280 move as soon as this month, as we still are 0:01:04.319 --> 0:01:06.960 looking at what the Senate is discussing on the future 0:01:07.040 --> 0:01:09.240 of the FED and who's actually sitting on it. 0:01:10.400 --> 0:01:13.000 There's a lot going on this week, but software in 0:01:13.040 --> 0:01:16.360 particular now earnings in that context are driving markets lower 0:01:16.600 --> 0:01:19.160 in this case. So Salesforce is talking of its kind 0:01:19.160 --> 0:01:23.120 of historic growth rates, but the outlook for its top 0:01:23.160 --> 0:01:25.240 line growth, particularly as it relates to AI, it's just 0:01:25.240 --> 0:01:27.399 not there yet. We're going to get into the analysis 0:01:27.400 --> 0:01:29.920 in just a second now, Figma, this is its first 0:01:29.959 --> 0:01:31.960 earnings post IPO at the end of July. 0:01:32.560 --> 0:01:33.640 Big drop on the stock. 0:01:33.680 --> 0:01:35.840 Remember it jumped to one hundred and fifty percent in 0:01:35.920 --> 0:01:38.480 its debut. Carrow, you were there, you lived through it. 0:01:38.480 --> 0:01:41.400 It basically met estimates, but it just shows how high 0:01:41.440 --> 0:01:44.039 and lofty expectations of the market are. Right now, I 0:01:44.080 --> 0:01:46.400 want to dig into numbers, starting with Salesforce. Let's get 0:01:46.400 --> 0:01:49.320 out to Blomberg Intelligence senior tech analyst and rag Rana. 0:01:49.400 --> 0:01:51.040 Maybe you caught Benny off on the call, maybe you 0:01:51.080 --> 0:01:53.600 caught him in interviews on other networks. He was talking 0:01:53.680 --> 0:01:56.240 up about like Salesforce growth rates and a RAG they 0:01:56.240 --> 0:01:59.360 are better than anyone out there. But the story seems 0:01:59.360 --> 0:02:01.760 to be the out and how AI is contributing. 0:02:01.760 --> 0:02:05.160 What do you think? Yeah, I think the expectations were 0:02:05.200 --> 0:02:07.000 a little bit high in that case from the AI 0:02:07.040 --> 0:02:09.800 contribution point of view, But if you look at results 0:02:09.800 --> 0:02:13.400 from Workday and other tech companies, out there. We are 0:02:13.520 --> 0:02:17.320 still struggling to see discritionary it spending bounce back. We 0:02:17.360 --> 0:02:19.640 have not seen any of that stuff. And given the 0:02:19.680 --> 0:02:22.480 size of a company salesforces, you're going to see the 0:02:22.600 --> 0:02:24.920 impact of that on bottom lines. If there are no 0:02:25.000 --> 0:02:27.800 massive secrets out there, you're not going to see revenue 0:02:27.800 --> 0:02:30.080 acce rate. And I think that's the story, which is, 0:02:30.440 --> 0:02:33.480 you know, I think common to most of the software landscape, 0:02:33.560 --> 0:02:37.320 except the companies that you know only work on AI, infrastructure, parking. 0:02:37.600 --> 0:02:39.840 If you leave them alone, the rest of the industry 0:02:39.880 --> 0:02:40.799 is struggling. 0:02:40.440 --> 0:02:44.440 Right now, what do you make the first numbers from Figma, 0:02:44.560 --> 0:02:47.399 because in many ways it was a company that pivoted 0:02:47.440 --> 0:02:50.000 well embraced generator of AI was able to show how 0:02:50.000 --> 0:02:52.520 it's working for its bottom line as a public company. 0:02:52.880 --> 0:02:54.400 We are seeing a tunnel in the shares. 0:02:55.320 --> 0:02:57.880 Yeah, I would say that my expectations were pretty bad 0:02:58.120 --> 0:03:00.359 or wrong in this case. I was looking for a 0:03:00.480 --> 0:03:03.359 revenue to improve because of a price increase they have 0:03:03.440 --> 0:03:06.040 put in. But it seems like, you know, they basically 0:03:06.120 --> 0:03:08.919 met the expectations that they gave. And to be very frank, 0:03:08.960 --> 0:03:11.360 in an IPO landscape, it doesn't work like that. The 0:03:11.400 --> 0:03:13.960 first few quoters. You really need to showcase, you know, 0:03:14.000 --> 0:03:17.520 an improvement in fundamentals. This just shows that there is 0:03:17.560 --> 0:03:19.519 a lot they have to do in order to get 0:03:19.560 --> 0:03:21.760 and I would say match up to the valuation that 0:03:21.800 --> 0:03:23.000 they have achieved right now. 0:03:23.520 --> 0:03:27.440 An Agrana holding yourself accountable. We appreciate that. Bluemeg Intelligence. 0:03:27.680 --> 0:03:30.440 We always love the expertise. Let's get a broader look 0:03:30.480 --> 0:03:32.800 at the tech sector right now because Carol Schlife is 0:03:32.800 --> 0:03:35.720 with us BIMO Private Wealth Chief market Strategist. 0:03:36.040 --> 0:03:37.000 Carol, it's been a while. 0:03:37.240 --> 0:03:40.280 Great to have you on Bloomberg Tech and more broadly, 0:03:40.320 --> 0:03:42.760 how are you thinking of the software story the AI 0:03:42.880 --> 0:03:45.000 winners versus Lewis's right now. 0:03:45.960 --> 0:03:48.600 Now we really first up, thanks for having me on. 0:03:48.720 --> 0:03:52.200 It's great to be back again, and it really is important. 0:03:52.360 --> 0:03:55.440 It takes you know, investors are very black and white. 0:03:55.440 --> 0:03:58.000 They want to see instantaneous results, but all of this 0:03:58.040 --> 0:04:00.520 stuff takes some time to filter through a figure out 0:04:00.560 --> 0:04:04.560 how we're going to deploy it. But the software and 0:04:04.320 --> 0:04:07.600 that moving away from, if you will, the picks and 0:04:07.640 --> 0:04:11.200 shovels of building out the infrastructure into the use cases 0:04:11.240 --> 0:04:14.080 and how that factors in. That is definitely a way 0:04:14.120 --> 0:04:17.600 that we see things playing out in the intermediate to 0:04:17.720 --> 0:04:20.520 longer term because you're not going to be able to 0:04:20.520 --> 0:04:22.880 get away from AI. A lot of companies are trying 0:04:22.920 --> 0:04:24.880 to figure out how to deploy it, how to use it, 0:04:25.360 --> 0:04:28.279 how to train their employees in using it. Because you've 0:04:28.279 --> 0:04:30.839 got those early adopters who are using it actively, and 0:04:30.880 --> 0:04:33.839 you've got the others that are not as willing to 0:04:33.839 --> 0:04:35.760 be on the bleeding edge, if you will, of the 0:04:35.839 --> 0:04:36.839 day to day use case. 0:04:37.680 --> 0:04:41.880 What therefore, is the likelihood that some of the older 0:04:42.120 --> 0:04:45.719 companies with big presence in the market, such as a salesforce, 0:04:46.160 --> 0:04:48.599 can fend off new competition. How much you having to 0:04:48.640 --> 0:04:51.400 build that in to an invest the risk right now 0:04:51.440 --> 0:04:54.200 that we are seeing a totally new cohort come to 0:04:54.279 --> 0:04:58.560 a powerful place in general to AI, you are, but. 0:04:58.520 --> 0:05:02.479 You're also seeing those the old line, old guard have 0:05:02.640 --> 0:05:05.040 the cash flow to be able to snap up some 0:05:05.120 --> 0:05:08.200 of those. It's almost like a whales and krill kind 0:05:08.279 --> 0:05:12.160 of scenario out there, and you look at, for example, 0:05:12.200 --> 0:05:14.240 in the build out of the infrastructure, You've got a 0:05:14.240 --> 0:05:16.760 lot of that going on too, where the largest companies 0:05:17.120 --> 0:05:20.560 are buying up the smaller companies in the competition, so 0:05:20.640 --> 0:05:25.160 that really smart, really useful competition. One of the ways 0:05:25.200 --> 0:05:29.120 they get leverage and into a lot of end users too, 0:05:29.440 --> 0:05:32.560 is through the distribution channel of some of those larger companies. 0:05:32.600 --> 0:05:35.000 So there's a use case to be made or an 0:05:35.040 --> 0:05:37.400 investment case to be made for a whole lot of 0:05:37.760 --> 0:05:39.840 sizes in that software industry. 0:05:40.720 --> 0:05:43.360 Carol, I really appreciate that the command you've got over 0:05:43.440 --> 0:05:47.000 what's happening right particularly in software. We've been talking about 0:05:47.000 --> 0:05:49.480 it all week. I mean, one of our guests this 0:05:49.560 --> 0:05:53.080 week said that September was the most hated month for investors. 0:05:53.400 --> 0:05:57.440 But basically, you know, we're going back to old fashioned 0:05:57.440 --> 0:06:01.719 earnings talk. Did they meet or excited high expectation, particularly 0:06:01.720 --> 0:06:05.400 in software sense? Not really? Did AI have a tangible 0:06:05.400 --> 0:06:06.840 contribution to top line growth? 0:06:07.120 --> 0:06:07.200 Not? 0:06:07.320 --> 0:06:07.640 Really? 0:06:07.960 --> 0:06:11.719 Is that the way that you approach a week like this, Well, I. 0:06:11.760 --> 0:06:14.560 Think a piece of it is is investors have to 0:06:14.640 --> 0:06:19.000 understand where what timeframe they're using, and where their expectations are, 0:06:19.000 --> 0:06:21.880 because you know, we've looked at a lot of these 0:06:21.920 --> 0:06:25.520 companies and you've got very active. When you step back 0:06:25.520 --> 0:06:27.600 from it, you look at the margins on these companies 0:06:27.680 --> 0:06:29.520 relative to most of the rest of the S and 0:06:29.600 --> 0:06:33.320 P those margins are great margins are cash flowing businesses, 0:06:33.760 --> 0:06:36.480 and as we all know, once you put a software 0:06:36.640 --> 0:06:40.039 system into a company, it's really hard to make a 0:06:40.080 --> 0:06:42.800 decision to change that or move that. And so from 0:06:42.839 --> 0:06:46.560 that perspective, I think investors have to ask themselves on 0:06:46.640 --> 0:06:49.599 an absolute basis, are these companies generating the kinds of 0:06:49.640 --> 0:06:52.920 revenues that I want? Even if they didn't be what 0:06:53.120 --> 0:06:57.039 the wildest expectations that I was hoping for. Because the 0:06:57.080 --> 0:07:00.240 industry tends to run or investors tend to run ahead 0:07:00.240 --> 0:07:03.000 of themselves, and the whisper numbers always a little bit 0:07:03.080 --> 0:07:06.880 higher than where they're at, and yet the companies, the 0:07:06.960 --> 0:07:11.120 industry in general are generating amazing returns. 0:07:12.000 --> 0:07:14.680 Carol, this week we talked at about concentration risk, and 0:07:14.720 --> 0:07:17.680 the more sanguine of your peers in the market would say, well, 0:07:18.040 --> 0:07:21.520 we look at profit estimates for the MAG seven in particular, 0:07:21.600 --> 0:07:24.200 but tech generally so much better than the S and 0:07:24.200 --> 0:07:27.440 P five hundred aggregate. But you have concentration risk. How 0:07:27.480 --> 0:07:29.080 are you thinking about that at the moment. 0:07:30.120 --> 0:07:33.120 I think one of the ways that we deal with 0:07:33.160 --> 0:07:37.000 it is barbelling portfolios and really leaning into that diversification 0:07:37.080 --> 0:07:42.280 because there is concentration risk. You've also got higher valuations overall, 0:07:42.560 --> 0:07:46.240 and you've got markets that are primed for perfection if 0:07:46.240 --> 0:07:48.720 you will, so they don't, they don't leave. That doesn't 0:07:48.800 --> 0:07:51.560 leave much wiggle room other than when you get big 0:07:51.600 --> 0:07:53.680 pullbacks like we had in April. It's one of the 0:07:53.680 --> 0:07:56.400 reasons why I think the pullback was so short lived 0:07:56.480 --> 0:07:59.040 back then and the reset was quick is people who 0:07:59.040 --> 0:08:01.720 have been sitting on the sidelines looking for an opportunity 0:08:01.760 --> 0:08:03.880 to get in dead. So one of the ways that 0:08:03.920 --> 0:08:08.240 you deal with that is you school yourself to expect 0:08:08.320 --> 0:08:12.080 some level of volatility, don't freak out when it first happens, 0:08:12.360 --> 0:08:15.600 and maybe own some other industries, some other segments, some 0:08:15.720 --> 0:08:18.880 other parts of the globe, and maybe some fixed incomers 0:08:19.200 --> 0:08:22.720 to balance the portfolio and to allow it to be 0:08:22.760 --> 0:08:24.560 able to ride through those storms. 0:08:25.200 --> 0:08:26.360 Diversification key. 0:08:26.480 --> 0:08:29.360 But just going back to the concentration risk and the 0:08:29.440 --> 0:08:31.480 area of hardware having been the most loved. 0:08:31.520 --> 0:08:33.160 Salesforce is down thirty. 0:08:32.920 --> 0:08:37.320 Percent basically year to date with looking at Broadcom up 0:08:37.440 --> 0:08:39.600 thirty percent year to date, and we got their earnings 0:08:39.600 --> 0:08:42.280 after the ball is hardware and picks and shovels still 0:08:42.280 --> 0:08:44.880 where it's at Carol, Well, I think. 0:08:44.760 --> 0:08:46.839 A piece of it. We're not through with that build 0:08:46.920 --> 0:08:49.440 ut segment yet, but you know, a piece of the 0:08:49.520 --> 0:08:52.240 questions you're starting to ask yourself is particularly as it 0:08:52.280 --> 0:08:54.880 relates to data centers and some of the other things 0:08:54.880 --> 0:08:56.880 that are going on. It's great if you can put 0:08:56.880 --> 0:08:59.240 them up, if you can put a side, then not 0:08:59.360 --> 0:09:01.600 in my backyard, and sorts of pushback you're getting in 0:09:01.679 --> 0:09:03.839 some of those, but then when you're getting told it's 0:09:03.840 --> 0:09:05.440 going to take five or six years to hook it 0:09:05.480 --> 0:09:07.800 to the grid. So there's lots of different ways to 0:09:07.880 --> 0:09:11.600 play the hardware and the buildout and who's got capacity 0:09:11.600 --> 0:09:13.600 and able to do it. But there's a whole other 0:09:13.679 --> 0:09:18.000 segment of bringing in some of the reshoring activities that 0:09:18.040 --> 0:09:19.959 are going on as well. 0:09:20.040 --> 0:09:22.040 Carol, it's got to that time of the show where 0:09:22.040 --> 0:09:25.680 I ask you the impossible question, what happens next in 0:09:25.720 --> 0:09:28.640 the balance of twenty twenty five for the technology sector? 0:09:28.679 --> 0:09:30.920 Your big predictions, please, We. 0:09:31.440 --> 0:09:34.040 Do think that you'll see continued grind higher. I mean, 0:09:34.160 --> 0:09:37.240 markets have been climbing a wall of worry technology as 0:09:37.280 --> 0:09:40.280 well all year, and we think you'll see a continued 0:09:40.320 --> 0:09:44.119 sort of grudging climb higher. You know, many company managements 0:09:44.120 --> 0:09:47.880 have told us they're nauseously optimistic for this final quarter, 0:09:47.920 --> 0:09:49.640 and I would think we're in that camp too. 0:09:51.360 --> 0:09:53.720 Carol's life a bemo private wealth. It's great to have 0:09:53.760 --> 0:09:56.280 you back on the show and we always appreciate a prediction. 0:09:56.400 --> 0:09:58.839 Thank you very much. Now we have some breaking news 0:09:58.880 --> 0:10:01.800 crossing the Bloomberg time or. Rhode Island and Connecticut have 0:10:01.920 --> 0:10:06.360 sued the Trump administration over the administration order blocking further 0:10:06.440 --> 0:10:09.880 construction of a nearly completed offshore wind palm, which was 0:10:09.920 --> 0:10:12.680 meant to provide power to the two New England states. 0:10:12.720 --> 0:10:16.000 You'll remember, Carra, August twenty second, the administration issued that 0:10:16.160 --> 0:10:19.520 stop work order. We also had the companies involved have 0:10:19.600 --> 0:10:22.720 a parallel suit against the US in order that the 0:10:22.760 --> 0:10:25.320 wind farm work can continue. But the breaking news right 0:10:25.320 --> 0:10:27.360 now is that Rhode Island and Connecticut, two of the 0:10:27.400 --> 0:10:30.880 New England states, participating in a suit against the administration, 0:10:31.320 --> 0:10:33.200 trying to get the judge to allow that work to 0:10:33.280 --> 0:10:33.840 move forward. 0:10:34.080 --> 0:10:35.559 What we got next future. 0:10:35.240 --> 0:10:37.160 Of energy is important to AI. We go back to 0:10:37.240 --> 0:10:40.520 aied coming up, Apple looking to go toe to toe 0:10:41.040 --> 0:10:43.400 with Open AI. Of course company it has a partnership with, 0:10:43.559 --> 0:10:46.520 but it's launching its own AI web search, integrating it 0:10:46.520 --> 0:10:46.920 in SyRI. 0:10:47.000 --> 0:10:49.360 We'll dig into that next. This is Bloomberg Tech. 0:11:16.320 --> 0:11:19.480 Apple said to be launching its own AI web search 0:11:19.559 --> 0:11:23.240 tool integrated into Siri, basically rivaling the likes of Open AI. 0:11:23.360 --> 0:11:26.560 Of Perplexity megs Mark German joins us, Now, it is 0:11:26.679 --> 0:11:29.480 such a thoroughly reported piece you put out yesterday and 0:11:29.520 --> 0:11:32.320 moved the stock. What's interesting is who's going to be 0:11:32.320 --> 0:11:36.600 helping build the underlying LLM and generator of AI within it. 0:11:36.679 --> 0:11:40.160 And it's not Perplexity, and it's seemingly not anthropic either. 0:11:41.360 --> 0:11:43.559 Yeah, that's right. We've known for some time that Apple's 0:11:43.600 --> 0:11:46.960 launching an overhauled version of Siri around March. This is 0:11:47.000 --> 0:11:49.960 going to include delayed features like the ability to tap 0:11:50.000 --> 0:11:53.960 into your personal data to fulfill queries. Obviously it's surprising 0:11:54.000 --> 0:11:57.040 it couldn't do that till now after launching fifteen years ago. 0:11:57.440 --> 0:12:00.280 But the feature that we didn't know was coming until 0:12:00.320 --> 0:12:04.800 yesterday is an AI web search tool, sort of an 0:12:04.840 --> 0:12:09.599 answer engine. Siri right now is able to answer questions, 0:12:09.760 --> 0:12:13.240 broad strokes of information it can provide, can control your phone, 0:12:13.640 --> 0:12:16.200 send messages, and what have you. What it doesn't do 0:12:16.280 --> 0:12:18.920 well is tap into the open web to get information 0:12:19.160 --> 0:12:21.120 and to still it down for you in the way 0:12:21.160 --> 0:12:24.760 that AI search engines today can do things like perplexity, 0:12:24.800 --> 0:12:27.840 things like CHATCHGPT. So now Apple will be launching their 0:12:27.840 --> 0:12:30.679 own answer engine that's going to come in March as 0:12:30.720 --> 0:12:33.280 part of an update called iOS twenty six point four, 0:12:33.679 --> 0:12:36.719 and over time I anticipate them to integrate it into Safari, 0:12:36.800 --> 0:12:40.440 into Spotlight and other parts of its operating systems. You know, 0:12:40.559 --> 0:12:43.000 Google Search is very important to Apple. It makes them 0:12:43.160 --> 0:12:47.080 roughly twenty billion plus per year. But the industry is shifting. 0:12:47.360 --> 0:12:49.559 You know, how many times are you going to Google 0:12:49.600 --> 0:12:52.319 Search right now? Probably fewer than you used to a 0:12:52.400 --> 0:12:55.600 lot of people are doing their searches from CHATCHGPT or perplexity. 0:12:55.840 --> 0:12:58.720 It's an increasing number of people. So this is important 0:12:58.720 --> 0:12:59.720 for Apple for its long term. 0:12:59.760 --> 0:13:03.640 Few world knowledge answers is just one part. You know, 0:13:03.679 --> 0:13:06.360 you're reporting shows us what the market has actually been 0:13:06.400 --> 0:13:09.679 asking for, which is when this revamp SERI comes as 0:13:09.679 --> 0:13:14.400 a package, so spring next year. I see basically three parts, right, 0:13:14.440 --> 0:13:18.240 a Siri redesign, a health AI subscription service, and then 0:13:18.280 --> 0:13:21.079 some conversational features on the home devices which we've discussed 0:13:21.080 --> 0:13:23.400 on the show What are we waiting for? That's coming 0:13:23.480 --> 0:13:23.920 in March? 0:13:23.960 --> 0:13:28.040 Mark in total, So what's coming in March is this 0:13:28.120 --> 0:13:31.240 AI search product I mentioned. The ability to tap into 0:13:31.280 --> 0:13:34.440 personal data to fulfill queries, things like who did I 0:13:34.480 --> 0:13:37.280 meet with a month ago? What song did ED text 0:13:37.320 --> 0:13:41.000 me last week? The ability to fulfill queries based on 0:13:41.000 --> 0:13:43.240 on screen content. You're looking at a picture of someone, 0:13:43.280 --> 0:13:46.240 tell me more. And then you have voice based navigation, 0:13:46.360 --> 0:13:48.840 so using your voice to control your phone, move around 0:13:48.880 --> 0:13:53.040 your operating system, telling Siri to like something on Instagram. 0:13:53.200 --> 0:13:56.680 Later in the year, you'll see the Health Plus subscription service, 0:13:56.920 --> 0:14:00.280 which is basically an AI agent for health. And you're 0:14:00.280 --> 0:14:03.040 also going to see a visual redesign for Siri later 0:14:03.120 --> 0:14:05.719 next year, and then the year after is likely when 0:14:05.720 --> 0:14:08.800 you're going to see the conversational Siri tied to that 0:14:08.920 --> 0:14:13.160 new robotic home device, the tabletop Robot, which is essentially 0:14:13.559 --> 0:14:16.600 a virtual person to have in your workspace to help 0:14:16.640 --> 0:14:18.040 you get things done throughout your day. 0:14:18.880 --> 0:14:23.320 So my question is, first, ed, what song did you 0:14:23.800 --> 0:14:25.000 message Mark German? 0:14:25.760 --> 0:14:26.000 Was it? 0:14:26.040 --> 0:14:28.160 I believe it was, Yeah, it was Pink Pony Club. 0:14:28.200 --> 0:14:31.680 That's no surprise any regular followers on social media. But 0:14:31.720 --> 0:14:33.760 I'm interested, Like you know, when I look at how 0:14:33.840 --> 0:14:37.080 Siri works right now, or Apple Intelligence, it summarizes what's 0:14:37.080 --> 0:14:39.160 in my email. It often will be like, here's your 0:14:39.160 --> 0:14:42.000 Spotify playlist of the day. Spotify sends updates as well. 0:14:42.160 --> 0:14:43.440 What would you have sent, Mark Carrot? 0:14:44.600 --> 0:14:47.200 What would I have sent? I? Did you see Oasis? 0:14:47.440 --> 0:14:50.520 So probably an Oasis song? But Mark Brawley, the question 0:14:50.560 --> 0:14:52.640 that I'm also going to ask you is, therefore I 0:14:52.720 --> 0:14:56.280 go back to the underlying technology here, the relationship between 0:14:56.320 --> 0:14:58.680 Google and Apple. We've just had such an update on 0:14:58.720 --> 0:14:59.560 it from Judge. 0:14:59.280 --> 0:14:59.960 Meta this week. 0:15:00.240 --> 0:15:02.120 That's going to be integral for what's going to be 0:15:02.120 --> 0:15:04.400 building the underlying technology for this product. 0:15:04.480 --> 0:15:07.000 Right Ah, Yes, you asked me that earlier. 0:15:07.000 --> 0:15:12.240 I did not answer the question, So. 0:15:10.640 --> 0:15:11.080 Go for it. 0:15:11.200 --> 0:15:11.520 Yes. 0:15:12.000 --> 0:15:15.640 So Apple has talked to open Ai and Thropic and 0:15:15.800 --> 0:15:19.600 Google most recently to partner with them to rebuild Siri 0:15:19.880 --> 0:15:22.800 as one of the components underlying the new Serie engine, 0:15:23.240 --> 0:15:25.240 and a lot of signs right now are pointing to 0:15:25.320 --> 0:15:28.520 them working with Gemini. Google has built a model for them. 0:15:28.960 --> 0:15:31.560 The two companies signed an agreement earlier this week a 0:15:31.640 --> 0:15:34.720 formal evaluation agreement. This doesn't mean they have a commercial agreement. 0:15:34.920 --> 0:15:37.960 That means they've agreed for Apple to evaluate a model. 0:15:38.600 --> 0:15:41.960 They're fine tuning it, and they're heavily considering it. They've 0:15:42.040 --> 0:15:46.080 also considered Anthropic very heavily, and they still are for 0:15:46.160 --> 0:15:49.640 different parts of Siri. The problem is is that Anthropic 0:15:49.720 --> 0:15:51.880 wants north of one point five billion a year and 0:15:51.880 --> 0:15:54.600 then revenue number that's going to escalate annually for the 0:15:54.640 --> 0:15:58.480 next three years, and that is a pretty a very 0:15:58.520 --> 0:16:01.560 big dollar amount to pay for technology like this. In 0:16:01.600 --> 0:16:04.760 Apple's mind, they feel they have little leverage here, and 0:16:04.880 --> 0:16:07.400 Google's a longtime partner and obviously that partnership is going 0:16:07.440 --> 0:16:09.960 to continue, so it all seems to fit. So we'll 0:16:09.960 --> 0:16:12.400 see what ends up happening, but I'm thinking Google. 0:16:12.120 --> 0:16:12.600 As of now. 0:16:13.600 --> 0:16:16.800 Bloomberg's Mark German, who, as Cary said, very detailed report 0:16:16.840 --> 0:16:19.960 on what happens next with Siri, Thank you very much. Meanwhile, 0:16:20.000 --> 0:16:23.120 open AI rival deep Seek's said to be developing an 0:16:23.160 --> 0:16:26.280 AI model with more advanced AI agent features. I want 0:16:26.280 --> 0:16:28.840 to get out to our AI editor Bloomberg Seth Figureman. 0:16:29.400 --> 0:16:32.480 Very interesting story that Bloomberg broke because like deep Seek, 0:16:32.720 --> 0:16:35.760 actually despite the sort of volatility of April, which deep 0:16:35.800 --> 0:16:39.000 Seat calls in markets. It moves slower than some of 0:16:39.000 --> 0:16:41.760 the other Chinese names working on models, but the whole 0:16:41.800 --> 0:16:44.120 point is that this is a gentic AI. They want 0:16:44.120 --> 0:16:45.640 something that goes beyond the chatbot. 0:16:46.080 --> 0:16:47.720 Yeah, that's right. I think we've all been a little 0:16:47.760 --> 0:16:50.400 bit surprised at how little we've heard from deep Seek 0:16:50.400 --> 0:16:53.280 in the last eight months since up ended the markets. 0:16:53.320 --> 0:16:56.200 We've seen a lot of products from Chinese and US rivals, 0:16:56.480 --> 0:16:57.960 and there's a lot of speculation mat what's going on 0:16:58.000 --> 0:17:00.080 behind the scenes. There are other challenges that might be facing, 0:17:00.120 --> 0:17:02.640 but what we've hurt and reported today is that its 0:17:02.640 --> 0:17:04.840 focus is really trying to make a splash in the 0:17:04.880 --> 0:17:06.919 agent market. And you know, for viewers here, this has 0:17:06.960 --> 0:17:09.679 really been where the tech industry has shifted to in 0:17:09.720 --> 0:17:12.439 the last six months or so. Open the eye, Anthropic, 0:17:12.560 --> 0:17:15.679 Google and others are all pushing out AI agent products. 0:17:15.720 --> 0:17:17.720 I think what Deepseeek is trying to do is basically 0:17:18.119 --> 0:17:21.359 build a new model that has agentic capabilities you know, 0:17:21.440 --> 0:17:24.280 embeded within it so that it can field more complex, 0:17:24.760 --> 0:17:28.560 multi step tasks on your behalf with minimal intervention. Again, 0:17:28.640 --> 0:17:30.119 a lot of companies are trying to do this, and 0:17:30.160 --> 0:17:33.560 we are seeing very mixed range of execution here, and 0:17:33.640 --> 0:17:35.800 it seems like deep Sea probably wants to make sure 0:17:35.800 --> 0:17:38.359 they put out something that will move the needle in 0:17:38.440 --> 0:17:39.880 this potentially crowded market. 0:17:40.440 --> 0:17:44.520 But the crowding really for deep Seek is its popularity 0:17:44.520 --> 0:17:46.960 in China. At the moment, is still the most popular 0:17:47.080 --> 0:17:50.440 chatbot tool. But as we say, Ali Baba Tencent, they've 0:17:50.480 --> 0:17:53.119 just had a rapid rate of innovations in their models. 0:17:53.119 --> 0:17:55.040 When do we anticipate R two will come out? 0:17:55.240 --> 0:17:56.919 Yeah, so again we gotta know if this one is 0:17:57.040 --> 0:17:58.640 R two, but this model is supposed to come out 0:17:58.640 --> 0:18:00.840 before the end of the Year's interesting though, is that 0:18:00.880 --> 0:18:03.600 Ali Baba tends up the ones you mentioned haven't been 0:18:03.720 --> 0:18:06.199 as active I think in the agent marketplace. I mean, 0:18:06.240 --> 0:18:08.640 they're doing a lot of image and digo generation technology, 0:18:08.680 --> 0:18:12.000 a lot of more sophisticated chatbots manners which we and 0:18:12.040 --> 0:18:15.800 others have covered, which is originally from Chinese origin, but 0:18:15.840 --> 0:18:17.720 now trying to move into Singapore. They have made a 0:18:17.720 --> 0:18:19.760 bigger splash with agent products, So there might be a 0:18:19.800 --> 0:18:22.879 bigger market within China and globally if deep Sea can 0:18:22.920 --> 0:18:24.920 do something competitive on the agent front. But it's hard 0:18:24.960 --> 0:18:27.199 to say right now how much it'll be different from 0:18:27.240 --> 0:18:27.879 what's out there. 0:18:28.200 --> 0:18:30.440 Seth Fiegerman breaking it down on Deep Seat. We so 0:18:30.600 --> 0:18:37.199 appreciate it. 0:18:37.200 --> 0:18:39.240 It is time now for talking tech and first up. 0:18:39.240 --> 0:18:40.400 Red Note so its. 0:18:40.320 --> 0:18:43.240 Valuation served nineteen percent in just three months. 0:18:43.320 --> 0:18:45.359 I think thirty one billion dollars now. The social media 0:18:45.400 --> 0:18:47.320 firm emerged the year this year. 0:18:47.280 --> 0:18:50.639 As a real viable competitor to TikTok, which faces threats 0:18:50.640 --> 0:18:52.679 of a ban in the United States. Remember some Red 0:18:52.760 --> 0:18:56.280 Note investors anticipate in an imminent IPO plus s k 0:18:56.440 --> 0:18:58.919 Heinex is set to pay two week seven billion dollars 0:18:58.920 --> 0:19:02.200 in bonuses to twelve labour tensions. Now, the company's labor 0:19:02.240 --> 0:19:05.520 union has improven landmark agreement allocating ten percent of the 0:19:05.520 --> 0:19:09.000 company's annual profitence to a bonus pool of its thirty 0:19:09.000 --> 0:19:12.240 three thousand, six and twenty five employees. For twenty twenty 0:19:12.320 --> 0:19:15.880 five alone, employees could receive only eighty thousand. 0:19:15.600 --> 0:19:16.960 Dollars in bonus. 0:19:17.200 --> 0:19:19.720 And in Vidia's venture capital arm is set to invest 0:19:19.920 --> 0:19:22.280 in Honeywell's Quantinum for. 0:19:22.280 --> 0:19:22.920 The first time. 0:19:23.200 --> 0:19:25.359 In Vidier is the latest big name backer behind the 0:19:25.440 --> 0:19:28.800 quantum computing company with the latest investment set to value 0:19:28.880 --> 0:19:31.680 quantinum at ten million dollars ed. 0:19:32.640 --> 0:19:35.119 All right, this week British finance app Revelue offered a 0:19:35.200 --> 0:19:37.840 secondary share sale with a seventy five billion dollar valuation. 0:19:37.880 --> 0:19:40.520 We covered it on the show Bloomberg's learned that Revolute 0:19:40.520 --> 0:19:44.400 is putting in extra work to remain private while retaining 0:19:44.440 --> 0:19:47.120