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Speaker 1: Bloomberg Audio Studios, Podcasts, radio news from.

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Speaker 2: The Heart where Innovation, money and power. Collie in Silicon Valley, Nbon.

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Speaker 3: This is Bloomberg Technology with Caroline Hyde and Ed Ludlow

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Speaker 3: live from New York.

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Speaker 2: I'm Tim Steneveeck in for Caroline Hyde. This is Bloomberg

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Speaker 2: Technology coming up. Cloud nine. Broadcom up around twenty percent,

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Speaker 2: soaring the most going all the way back to twenty

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Speaker 2: twenty and topping one trillion dollars in valuation after posting

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Speaker 2: it better than expected results. Plus Jeff Bezos looks to

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Speaker 2: President Elect Trump to help with his space ambitions against

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Speaker 2: yes Elon Musk and San Francisco's incoming mayor Daniel Lurie

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Speaker 2: certainly wants to take advantage of the AI boom for

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Speaker 2: the revival of the city, but for him it's more

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Speaker 2: than just AI. More on that later this hour. First off, though,

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Speaker 2: let's get a check on it Broadcom with Bloomberg's abigailty

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Speaker 2: Do a little Hey I we.

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Speaker 4: Go, Hey Tim, Yeah, this is a really impressive rally.

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Speaker 4: Take a look at the shares of Broadcom, up about

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Speaker 4: nineteen percent on the day right near session hives. This

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Speaker 4: is a two day chart so that you can really

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Speaker 4: see today's spike HIRER. That tells you that investors were

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Speaker 4: surprised by the degree of the positivity.

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Speaker 2: Coming out of the quarter.

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Speaker 4: Now, the quarter they reported was sort of mixed, but

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Speaker 4: what investors love it's all about AI. They are saying

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Speaker 4: that they can grow AI, their AI part of the

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Speaker 4: business in the first quarter by sixty five percent. They're

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Speaker 4: also saying by twenty twenty seven, they see that the

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Speaker 4: AI components market could be ninety billion dollars. So investors

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Speaker 4: absolutely loving this. But this is not the only positive

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Speaker 4: day for Broadcom this year. Let's put Broadcom in context

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Speaker 4: of one of the most well known AI chip companies,

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Speaker 4: and that of course is in Vidia, and then the

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Speaker 4: SMP five hundred, excuse me, the socks that chips over

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Speaker 4: all index just to see, and here's Broadcom's big spike

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Speaker 4: record high today. I think tim based on my work

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Speaker 4: in the Bloomberg, I think it may actually be the

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Speaker 4: best day ever going back to two thousand and nine,

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Speaker 4: and it is trading at a record high. There's NVIDI

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Speaker 4: and there's the SMT five hundred. Not so shabby for

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Speaker 4: Broadcom this year at all. Today a big piece of

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Speaker 4: the rally.

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Speaker 2: Yeah, you're right, most since going all the way back

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Speaker 2: to two thousand and nine. Thanks so much, Av Gail

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Speaker 2: do a little appreciate that. Let's get a deeper dive

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Speaker 2: into Broadcom with Kun John Sabani of Bloomberg Intelligence. Kuonjohn,

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Speaker 2: you joined us live on a Bloomberg BusinessWeek just yesterday.

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Speaker 2: As Broadcom's numbers broke, shares bounced around up two percent

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Speaker 2: even when negative. What happened on the earnings call that

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Speaker 2: gave investors the conviction to send shares hired by twenty percent,

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Speaker 2: giving Broadcom a market cap of a trillion dollars for

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Speaker 2: the first time ever.

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Speaker 5: Yeah, it was really that massive sixty to ninety billion

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Speaker 5: sam by twenty twenty seven, just across three of its

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Speaker 5: largest hyper sale customers. That's about three to four times

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Speaker 5: fold growth in over the three years. So what it

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Speaker 5: did is give investors there is a clear, quantifiable target

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Speaker 5: to focus on over the next three years instead of

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Speaker 5: constantly worrying about the near term. How's the next water

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Speaker 5: going to look like? How's the next year going to

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Speaker 5: look like?

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Speaker 2: Kunjohn. Ai revenue grew two hundred and twenty percent during

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Speaker 2: the year. It was fueled by demand for processors and

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Speaker 2: networking components. Hottan said that on the call, demand for

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Speaker 2: non AI chips, though we'll be down in the first quarter,

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Speaker 2: our investors should investors just kind of right off non

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Speaker 2: AI chips at this point.

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Speaker 5: At this point they should, especially given the growth rates

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Speaker 5: he is given for the AI business. I mean, look,

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Speaker 5: the AI business is going to grow to be the

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Speaker 5: majority of portion. I think the non AI business right

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Speaker 5: now sort of twenty percent of that will continue even

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Speaker 5: shrinking down. So if we didn't have those massive temps, yes,

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Speaker 5: people would have looked at what's happened in wireless, what's

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Speaker 5: happening with software, what's happening in one que slowing down?

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Speaker 5: But at this point all of those worries are out

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Speaker 5: the window.

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Speaker 2: Kun John Sabani of Bloomberg Intelligence out there in San Francisco,

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Speaker 2: thanks so much from more on broad in the company's

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Speaker 2: nearly one hundred percent rallies so far this year. We're

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Speaker 2: joined by Bloomberg's Ian King Ian. One of the ways

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Speaker 2: that hog ten has been able to build Broadcom into

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Speaker 2: one of the most valuable companies in the chip industry

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Speaker 2: is through acquisitions. Does this trend continue? I mean, he

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Speaker 2: was asked about that.

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Speaker 6: He said he was asked, look, hey, Hawk, you've got

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Speaker 6: a lot of cash. Does that mean you're getting ready

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Speaker 6: to do another big one? And they said no, no,

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Speaker 6: we're going to focus on bringing down our debt. But

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Speaker 6: then later on in Nicoll he was asked, well, does

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Speaker 6: this mean your your strategy of making acquisitions is the

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Speaker 6: thing of the past, that you're going to focus on

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Speaker 6: organic growth in AI And he was like, oh no,

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Speaker 6: we're still looking so kind of beast message there.

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Speaker 2: Okay, So what kind of companies have they acquired in

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Speaker 2: the past and what kind of companies could potentially be

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Speaker 2: on their radar?

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Speaker 6: Yeah, I mean they've they've gone through the whole Panoplio

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Speaker 6: that they started off in semiconduct has he acquires what

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Speaker 6: he calls franchises. These are really sort of long standing,

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Speaker 6: important parts of the industry that he believes are kind

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Speaker 6: of undervalued, and then he kind of strips out, makes

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Speaker 6: them sort of lean and mean again, and that's been

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Speaker 6: a really successful policy. And then he took that strategy

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Speaker 6: and spun it into software and most recently he went

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Speaker 6: for VMware. And what he's going to do next, who knows.

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Speaker 6: He said he's open to software and semiconductor. Obviously, all

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Speaker 6: eyes are on Intel right now and whether this is

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Speaker 6: something which might figure into his calculations.

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Speaker 2: Okay, well that's a perfect segue. Let's go to Intel

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Speaker 2: right now, because CFO Dave Disner said that a formal

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Speaker 2: separation of the company's factory and product development divisions is

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Speaker 2: an open question. It'll be decided by the next leader

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Speaker 2: of the company. Ian I thought that this had been

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Speaker 2: kind of put to bed and Intel was going to

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Speaker 2: stay the type of company that it's been for over

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Speaker 2: the last couple of years. What's the latest time in it.

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Speaker 6: Yeah, No, it had been put to bed by Pat Gelsinger.

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Speaker 6: Unfortunately for him, he's not in that job anymore. Right,

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Speaker 6: he's not in a position to say he said, stronger together,

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Speaker 6: better together. One of the co CEO replacements, Michelle Johnson

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Speaker 6: hold House, who was on stage as well, said yeah, no, yeah,

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Speaker 6: we think we're matched together. But both her and Dave's instner,

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Speaker 6: the CFO and COCO said yeah, but you know, it's

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Speaker 6: not our call. We'll see what happens, And that, really,

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Speaker 6: I guess in Wall Street's minds kind of opened the

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Speaker 6: door to this being a much more firm possibility.

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Speaker 2: Okay, So what part of the company could be spun off?

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Speaker 2: Where could that company go? Would it be a public company,

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Speaker 2: would Broadcom be interested in part of the company? What

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Speaker 2: do you see? Yeah?

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Speaker 6: I mean, the focus was on what happens to the

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Speaker 6: product side of the company and the manufacturing side of

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Speaker 6: the company, that perhaps these two entities become something separate. Frankly,

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Speaker 6: the manufacturing side right now is piling on the losses.

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Speaker 6: It's really not in a financial position that would make

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Speaker 6: an IPO even a vague possibility right now and probably

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Speaker 6: not for you know, a matter of years while it

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Speaker 6: tries to build up its presence with outside customers. That's

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Speaker 6: not really an option. That would have to be new ownership,

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Speaker 6: new ownership with very deep pockets. Whether that's Broadcom or

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Speaker 6: anybody else, we don't know. The product side is arguably

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Speaker 6: a bit more healthy, particularly in PCs. It might be

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Speaker 6: something that somebody like Qualcom or Broadcom might.

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Speaker 2: See a useful Okay, well, certainly, busy days ahead for

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Speaker 2: Ian King and for all of us. Ian King certainly

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Speaker 2: appreciate you joining us. Thanks so much. Let's continue the

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Speaker 2: conversation with epac Oscar Deshkai, a senior analyst over at

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Speaker 2: Swiss Code. It's a banking group specializing in providing online

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Speaker 2: financial and trading services. EPEC record highs for Broadcom, our

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Speaker 2: Bel Technology, and this week for meta platforms, Apple, Alphabet, Tesla,

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Speaker 2: the names continue. What inning are we in in your

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Speaker 2: view when it comes to this megacap tech bull.

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Speaker 7: Run, Well, absolutely well, good news keep coming in and

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Speaker 7: they actually fund this rally and extend. Really they do

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Speaker 7: justify the extension of the rally for Broadcom, for example, Well,

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Speaker 7: they actually announce a revenue growth for the AI business

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Speaker 7: of two hundred and twenty percent. They are looking for

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Speaker 7: sixty five percent growth in their revenue in the first quartum.

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Speaker 7: Those are the big, big numbers that we are used

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Speaker 7: to that we like, especially in the AI and technology stock.

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Speaker 7: So that's actually giving a boost to the companies and

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Speaker 7: to Com today.

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Speaker 8: Well, we are also.

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Speaker 7: Very much impressed by cooms projection of a boom in

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Speaker 7: their AI business, especially the custom AI chips in the

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Speaker 7: next few years. That actually fits exactly right in the

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Speaker 7: middle of this narrative that's unfolding right now that the

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Speaker 7: big technology companies are actually building their own chips, so

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Speaker 7: that means that they are going to be users and

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Speaker 7: they're going to be winners. So we expect to see

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Speaker 7: still a little change of the scenery when twenty twenty

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Speaker 7: five begins.

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Speaker 2: Okay, you mentioned there will be winners and there will

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Speaker 2: be losers. Let's start with the losers. Who are they

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Speaker 2: going to be?

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Speaker 7: I mean, I don't want to say losers. Nvidia is

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Speaker 7: not smiling today, and they are right because we are

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Speaker 7: now in this narrative of big technology companies, which actually

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Speaker 7: made up to fifty percent of its revenue last quarter,

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Speaker 7: trying to build their own chips. So we're talking about

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Speaker 7: Amazon with their Trainium chips. Google came out with his

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Speaker 7: own I mean, everybody is up now building their own

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Speaker 7: chips in order to well cost efficient for cost efficiency reason.

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Speaker 7: So this means that Nvidia will have to replace these

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Speaker 7: big technology companies by other customers. Now, we know that

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Speaker 7: Jensen one didn't look worried at all up until now,

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Speaker 7: but that's still a fly.

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Speaker 2: So are you saying that that folks who have ridden

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Speaker 2: this high for Nvidia should be thinking about getting out

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Speaker 2: at some point soon.

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Speaker 7: Well, I want to say that right now, because these

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Speaker 7: worries of big technology companies that will start slowing their

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Speaker 7: spending has not materialized just yet, because earlier this week

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Speaker 7: we had TSM sales numbers for November and they actually

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Speaker 7: announced a thirty four percent growth in their sales in November,

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Speaker 7: which actually continues to back this narrative of robust AI

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Speaker 7: demand for Nvidia's chips. But it is a certainty that

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Speaker 7: this high concentration of big technology companies in their client

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Speaker 7: book is something to be watched.

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Speaker 2: Okay, we know you've mentioned in video and not a

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Speaker 2: company that should be smiling today Broadcom certainly one that is,

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Speaker 2: what are the other names that you're bullish on going

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Speaker 2: into twenty twenty five.

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Speaker 7: Well, AMD is not smiling today, But we actually like

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Speaker 7: AMD for one particular reason, and is the fact that

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Speaker 7: AMD proposes cost efficient and more affordable but as efficient

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Speaker 7: as efficient, very efficient chips and that could actually be

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Speaker 7: interesting for those sectors and companies who do not necessarily

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Speaker 7: want the most premium chips out there, but who want

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Speaker 7: good chips sale for you know, doing their day to

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Speaker 7: day task with AI. And that's going to be very interesting.

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Speaker 7: We think that there is an opportune to window for

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Speaker 7: AMD to get into this race more seriously and well,

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Speaker 7: question the the NVIDIAs or eat a part of mvda's

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Speaker 7: cake in the coming years.

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Speaker 2: A lot of the exuberance around AI has certainly focused

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Speaker 2: on the chip companies, but what if we move beyond

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Speaker 2: those chip companies. Who else do you see as winners

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Speaker 2: when it comes to this boom and AI.

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Speaker 7: Well, actually we see, for example, well we see all

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Speaker 7: the clients as winners because they are going to get

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Speaker 7: an important part of their important efficiency and cost efficiencies

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Speaker 7: in this process. So this is obviously one thing, and

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Speaker 7: this is why this whole thing is happening. But we're

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Speaker 7: also looking very closely to what's happening in the energy sector,

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Speaker 7: and we think that the nuclear power providers are going

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Speaker 7: to be in a good position to benefit from the

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Speaker 7: ar really, given that it is clear right now that

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Speaker 7: the alternative energy sources like wind and solar are not

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Speaker 7: going to offer the enough scalability actually for satisfying all

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Speaker 7: these exponentially arising energy demands.

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Speaker 2: Nuclear power so little intensive to develop, especially here in

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Speaker 2: the United States, We've only had a couple new generators

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Speaker 2: come online over the last couple of decades. Who do

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Speaker 2: you think can pull this off in the next few

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Speaker 2: years or are we talking like a generational shift here.

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Speaker 7: Well, yes, you're right. It has been controversial as well,

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Speaker 7: so it's here in Europe as well. We have been

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Speaker 7: closing the nuclear plans and not to the contrary. But

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Speaker 7: this year we have started seeing the mentality change a

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Speaker 7: little bit, especially when big technology companies started announcing that

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Speaker 7: they are going to be interested in using nuclear power

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Speaker 7: instead of while using fossil fuel or fossil well, actually,

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Speaker 7: excell as, it was saying that they are going to

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Speaker 7: offer gas for gas powered plans to big technology companies

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Speaker 7: that's going to be built in half time, like in

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Speaker 7: five years, and they're going to offer these companies and

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Speaker 7: after good energy source. But at the end of the day,

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Speaker 7: when we are talking about tackling climate change and offering

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Speaker 7: an alternative and clean energy source, well, today nuclear looks

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Speaker 7: like the only plausable option that could satisfy our increasing

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Speaker 7: and exponentially increasing needs.

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Speaker 2: May pec Oscar Deshkaia, senior analyst at Swiss Quote joining

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Speaker 2: us from Geneva, thanks for standing up late for us.

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Speaker 2: Do appreciate that Jeff Bezos is expected to meet with

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Speaker 2: President elect Tromp to discuss Amazon's Project Kuiper. It's a

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Speaker 2: satellite Internet service that is facing delays and cost overruns.

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Speaker 2: Bezos look into the new administration for help in the

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Speaker 2: space race against fellow cent a billionaire Elon Musk. Bloomberg's

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Speaker 2: Bruce Einhorn joins US now Bruce. Project Kuiper supposed to

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Speaker 2: be this competitor to SpaceX's Starlink. Is it fair at

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Speaker 2: this point to even call it a competitor.

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Speaker 9: Well, it aspires to be, but at the moment it's

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Speaker 9: not there yet. So Starlink has more than six thousand

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Speaker 9: satellites operating, providing high speed Internet service around the world.

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Speaker 9: Amazon wants Project hyper to do something similar. The original

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Speaker 9: goal was to have the first batch of operational satellites

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Speaker 9: launch first half of this year, and by this time

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Speaker 9: they would have beta service starting. They've encountered delays though

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Speaker 9: in launching the satellites. They're now looking to launch the

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Speaker 9: first batch of satellites early next year and then have

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Speaker 9: service starting later in the year. The big problem for

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Speaker 9: them is, well, one big problem is that they do

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Speaker 9: have a deadline that they received from the Federal Communications

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Speaker 9: Commission when they first got the license for this back

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Speaker 9: in twenty twenty. They need to have half of their satellites.

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Speaker 9: It's over sixteen hundred satellites up and operating by the

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Speaker 9: middle of July, I mean by middle of twenty twenty six,

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Speaker 9: July twenty twenty six. They don't get that, then they're

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Speaker 9: going to need the FCC to give them an extension,

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Speaker 9: to give them a waiver.

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Speaker 2: One challenge is get those satellites into orbit. Blue Origin

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Speaker 2: is certainly a possibility, but if they can't pull it off,

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Speaker 2: can they rely on SpaceX to do this? Would that

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Speaker 2: ever happen?

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Speaker 9: While they do have a contract with SpaceX to launch

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Speaker 9: on I think three SpaceX rockets, but that's just a

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Speaker 9: tiny part of their total launch needs. So for the

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Speaker 9: most part, Amazon is looking to new rockets from Blue Origin,

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Speaker 9: which is Jeff Bezos founded company, as well as europe

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Speaker 9: Arian Spots and United Launch Alliance, which is joint venture

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Speaker 9: between Boeing and Lockheed Martin. The challenge though, is that

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Speaker 9: those three companies all have new rockets. Among the three

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Speaker 9: of them, those rockets have launched a total of three times,

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Speaker 9: so they don't really have a huge track record, and

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Speaker 9: it takes a while to get rockets up and going

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Speaker 9: to a frequent, frequent launch schedule. So it's a big

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Speaker 9: challenge that they face. On the other Cant of course,

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Speaker 9: has its own rockets. They don't have to worry about

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Speaker 9: it exactly. And it seems like, speaking of SpaceX, Elon

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Speaker 9: Musk and President elect Trump are extremely tight. After what

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Speaker 9: happened over the last few months and the more than

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Speaker 9: two hundred million dollars Musk spent to help get Trump elected.

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Speaker 9: How bad is that for Jeff Bezos. Well, of course,

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Speaker 9: Musk and the President elect are very close. President Trump

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Speaker 9: during his first term did have some run ins with

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Speaker 9: Jeff Bezos. There was some criticism from the president of

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Speaker 9: Jeff Bezos, who of course owns the Washington Post. Amazon

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Speaker 9: did go to court in the first Trump administration alleging

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Speaker 9: unfair treatment of the company, saying that they had been

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Speaker 9: cut out of a contract with the Defense Department. So

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Speaker 9: there is history there. More recently, we have seen pretty

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Speaker 9: upby comments from Jeff Bezos about the President elect and

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Speaker 9: the new administration.

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Speaker 2: Bruse ein Horn, thanks so much for joining us. Do

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Speaker 2: appreciate that today. Well, speaking of another story that we

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Speaker 2: are watching, Elon Musk looking to transform his SpaceX Star

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Speaker 2: based site into a new city. The site in Boca Chica,

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Speaker 2: Texas currently the primary location for building and launching SpaceX's

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Speaker 2: Starship Rockets, and it's created over three thousand jobs. Several

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Speaker 2: steps need to occur before Starbase can be created as

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Speaker 2: a new city, including permission from local authorities. Coming up,

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Speaker 2: we'll discuss the intersection of AI and sports with the

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Speaker 2: CEO of VM. That's next. This is Bloomberg. A new

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Speaker 2: partnership could change the way millions of fans experience live

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Speaker 2: sports around the world. New York Islanders and Ubs Arena

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Speaker 2: have teamed up with VM to develop quick Q. It's

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Speaker 2: a tool that directs fans to the shortest lines so

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Speaker 2: then can get back to their seats as soon as possible.

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Speaker 2: The company putting AI into action and other industries too,

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Speaker 2: including marine manufacturing, robotics, as well as food and beverage.

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Speaker 2: Here with us is Elliott Horow, a CEO and founder

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Speaker 2: at VM. Elliott, good to see you. I want to

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Speaker 2: get to the Ubs are in a partnership in a minute.

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Speaker 2: But you co founded Mango dB. Before that, you co

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Speaker 2: founded shop Wiki. This is not your first rodeo. What's

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Speaker 2: the problem that you identified that VM would solve?

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Speaker 10: Well, thanks for having us, Tim So the problem that

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Speaker 10: I was focused on after I thus Mango dB, it

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Speaker 10: was all about physical.

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Speaker 2: Devices in the real world. Right.

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Speaker 10: We all live in the real world. We all want

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Speaker 10: to have the real world be better for us in

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Speaker 10: whatever way, and so we built VM to be an

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Speaker 10: engineering platform for physical devices.

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Speaker 11: Right.

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Speaker 10: And that's from air conditioners in your house to robots

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Speaker 10: on a factory floor.

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Speaker 12: Right.

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Speaker 10: It's all about making it easier to build these products.

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Speaker 5: Right.

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Speaker 10: You need a lot of different engineering counts to make

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Speaker 10: that happen, from software engineers to mechanical engineers to AI engineers.

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Speaker 10: So how do you make a platform that makes it

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Speaker 10: ten times easier to bring these products to life?

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Speaker 2: Okay, so let's get to this UBS partnership. The idea

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Speaker 2: is you're watching an Islanders game, You've got to use

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Speaker 2: the restroom. You can tell by opening the Islanders app

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Speaker 2: where to go and how long it'll take exactly right.

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Speaker 10: The Islanders, the Islanders ownership and you know John the

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Speaker 10: Decky who we partnered with, are all about fan experience, Right.

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Speaker 10: How do you have the experience of going to an

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Speaker 10: Islanders game, going to any event at UBS arena be

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Speaker 10: as great as possible? And so the biggest problem with

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Speaker 10: one of the biggest problems with going to a game

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Speaker 10: is when do I go to the bathroom? How do

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Speaker 10: I have to wait in line? And so you can

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Speaker 10: open up the Islanders app and see immediately which bathrooms

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Speaker 10: have the shortest line, if there's a line right now,

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Speaker 10: and so you can know when to go, where to

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Speaker 10: go and make that part of the experience much better.

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Speaker 2: What's the hardware that has to be installed at ubs

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Speaker 2: arena in order to make this happen.

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Speaker 10: So one of the great things we were able to

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Speaker 10: do was actually add almost no hardware. Right, We're able

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Speaker 10: to add this to the existing security cameras that they

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Speaker 10: already had in place, you know, just monitoring for security

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Speaker 10: and safety around the arena, and so to tap into

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Speaker 10: the existing cameras and just look at those cameras and

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Speaker 10: determine what the line was for the bathrooms.

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Speaker 2: So what's the tech layer there?

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Speaker 10: So the entire tech layer is the existing security cameras

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Speaker 10: and then just VM outside of that, Right, So VM

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Speaker 10: is tapping into those existing cameras, looking at those feeds

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Speaker 10: in real time, doing AI actually in the arena itself,

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Speaker 10: and then pushing that data to the Islanders up.

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Speaker 2: Okay, let's talk fundraising here. You've raised just shy of

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Speaker 2: ninety million dollars at this point. How long does that

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Speaker 2: runway give you? When do you need to raise more money?

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Speaker 10: We're always talking to investors about raising more money.

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Speaker 2: You know.

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Speaker 10: One of the things about VM is we're not a

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Speaker 10: lacking ambition company, right. We're thinking about everything from in

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Speaker 10: your house again to arenas, lots of things we want

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Speaker 10: to do about fan experience and lots of arenas, but

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Speaker 10: then also everything to cleaning oceans, and so we will

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Speaker 10: be raising more money and we're doing a lot of

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Speaker 10: interesting projects all over the place.

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Speaker 2: Are you actively raising money at this point? Like, are

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Speaker 2: you out there talking to investors right now? I mean

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Speaker 2: I talk to investors probably every week. Are they give

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Speaker 2: you are you getting incoming though? Are they saying, hey,

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Speaker 2: we want to give you money? Is that the environment

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Speaker 2: out there? There's a lot of you You have a

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Speaker 2: strong track record too, right, And there's a.

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Speaker 10: Lot of interest in physical devices, physical world and AI right.

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Speaker 10: And we're taking a pretty unique approach, and we're really

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Speaker 10: focused on short term wins and how do people make

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Speaker 10: practical things better on an everyday basis?

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Speaker 2: What do you envision for the home. That really intrigues me.

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Speaker 2: What's in your perfect world do you imagine happening with

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Speaker 2: VM in the home.

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Speaker 10: I think a lot of people have something in their

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Speaker 10: house that is somewhat smart, right, Maybe it's an air

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Speaker 10: conditioning system that's supposed to adjust the temperatures, or lights

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Speaker 10: that are supposed to be smart, or even just devices

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Speaker 10: that aren't smart, like an old air conditioner. Most of

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Speaker 10: those aren't very smart and really aren't great user experiences.

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Speaker 10: Or the number of people who've come to me and said, yeah,

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Speaker 10: my air conditioner broke down in August, I'm like, why

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Speaker 10: did that happen?

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Speaker 2: Why don't you know that it's going to break down?

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Speaker 10: When an air conditioner breaks, someone usually come to your house,

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Speaker 10: look at it, and then maybe go and get another part.

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Speaker 10: Why can't they have a computer that's always attached to

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Speaker 10: the air conditioner, always monitoring the air conditioner, so they

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Speaker 10: know exactly what part they need, and we can tell

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Speaker 10: you ahead of time, like, Hey, it's getting noisier, it's

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Speaker 10: starting to rattle, it's probably going to break in two weeks.

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Speaker 10: Should we become fixed it before you're stuck with no

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Speaker 10: AC and it's one hundred degrees outside, right, those sort

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Speaker 10: of very practical, real world things that just get in

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Speaker 10: the way of day to day life.

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Speaker 2: We had to get a new washing machine in dry

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Speaker 2: and it's supposed to connect to the internet. It doesn't

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Speaker 2: even connect to the internet, right.

438
00:22:04,000 --> 00:22:05,639
Speaker 10: And this is what we hear over and over again

439
00:22:05,800 --> 00:22:08,879
Speaker 10: is that building devices right now is just simply too hard. Right,

440
00:22:09,000 --> 00:22:11,120
Speaker 10: It's too hard to connect these devices in your house

441
00:22:11,119 --> 00:22:12,760
Speaker 10: and in the real world to AI.

442
00:22:13,200 --> 00:22:16,440
Speaker 2: Elliott Horowitz, CEO and founder at VM joining us here

443
00:22:16,480 --> 00:22:25,920
Speaker 2: in New York. Welcome back to Bloomberg Technology. I'm Tim

444
00:22:25,920 --> 00:22:28,640
Speaker 2: Stenevek in New York. Let's get a check on the markets.

445
00:22:28,840 --> 00:22:32,000
Speaker 2: Taking a look at what's going on on a with Broadcom.

446
00:22:32,160 --> 00:22:36,000
Speaker 2: Look at that shares up right now, close to twenty percent.

447
00:22:36,520 --> 00:22:38,880
Speaker 2: Two hundred and fifteen dollars is where it's trading at

448
00:22:38,960 --> 00:22:41,320
Speaker 2: right now. WISES High is twenty two percent a little

449
00:22:41,359 --> 00:22:44,840
Speaker 2: earlier in the session, surging today to a one trillion

450
00:22:44,880 --> 00:22:48,080
Speaker 2: dollar market cap for the first time ever. After predicting

451
00:22:48,080 --> 00:22:50,960
Speaker 2: a boom in demand for its AI chip. Sales of

452
00:22:51,040 --> 00:22:53,240
Speaker 2: AI products are going to gain sixty five percent in

453
00:22:53,240 --> 00:22:56,200
Speaker 2: the fiscal first quarter. That's far faster than its overall

454
00:22:56,240 --> 00:22:59,200
Speaker 2: semiconductor growth of about ten percent. The chip maker also

455
00:22:59,240 --> 00:23:02,359
Speaker 2: predicting that the dressful market for AI components that it

456
00:23:02,400 --> 00:23:06,320
Speaker 2: designs for those data centers, those hyperscalers would reach as

457
00:23:06,400 --> 00:23:11,200
Speaker 2: high as ninety billion dollars by fiscal twenty twenty seven. Also,

458
00:23:11,320 --> 00:23:13,760
Speaker 2: let's take a look at what shares of Tesla not

459
00:23:13,920 --> 00:23:17,320
Speaker 2: just doing today, which yes, they're at a new record,

460
00:23:17,480 --> 00:23:20,400
Speaker 2: but over the last couple of months, they've almost doubled

461
00:23:20,440 --> 00:23:25,680
Speaker 2: in value since the election. Today's news is that the

462
00:23:25,800 --> 00:23:30,640
Speaker 2: Trump administration transition team could scrap an order that requires

463
00:23:30,680 --> 00:23:34,879
Speaker 2: car makers to report crashes involving self driving systems that

464
00:23:35,160 --> 00:23:39,439
Speaker 2: coming from Reuter's a little earlier in the day. Certainly,

465
00:23:39,480 --> 00:23:41,840
Speaker 2: those who've bet on Tesla over the last couple of

466
00:23:41,840 --> 00:23:45,720
Speaker 2: months and even before that, have gotten big payoffs. Well,

467
00:23:45,760 --> 00:23:48,840
Speaker 2: let's keep digging into the Musk trade now, because as

468
00:23:48,880 --> 00:23:51,320
Speaker 2: I mentioned, those who've bet on Elon Musk's business empire

469
00:23:51,560 --> 00:23:53,720
Speaker 2: are closing out in the year with some hefty payoffs.

470
00:23:53,800 --> 00:23:57,399
Speaker 2: Bloomberg's Nitsa Soakova looks into this for usdnitsa good to

471
00:23:57,440 --> 00:24:00,800
Speaker 2: see you give us an understanding of we've stuck by

472
00:24:01,080 --> 00:24:04,240
Speaker 2: Elon Musk over the past few years and how their

473
00:24:04,280 --> 00:24:05,760
Speaker 2: payoff looks at the end of this year.

474
00:24:06,440 --> 00:24:08,520
Speaker 8: Yeah, for sure. We have quite a few funds who

475
00:24:08,600 --> 00:24:11,200
Speaker 8: had placed big bets on in one Musk, which I

476
00:24:11,240 --> 00:24:13,359
Speaker 8: can imagine for the start of the year it wasn't

477
00:24:13,359 --> 00:24:17,000
Speaker 8: really a great performance, but now we're seeing really rapid

478
00:24:17,040 --> 00:24:20,440
Speaker 8: shifting fortituns. We of course love to talk about Destney

479
00:24:20,520 --> 00:24:23,200
Speaker 8: Tech one hundred, which is one of the few funds

480
00:24:23,240 --> 00:24:26,480
Speaker 8: who has so much exposure to SpaceX. That fund has

481
00:24:26,520 --> 00:24:29,480
Speaker 8: sold more than five hundred percent since the election. Just

482
00:24:29,600 --> 00:24:32,960
Speaker 8: incredible rally. This is both due to the price of

483
00:24:33,000 --> 00:24:36,520
Speaker 8: the underlying growing, but more importantly it's due to the

484
00:24:36,640 --> 00:24:39,960
Speaker 8: very big demand we're seeing from retail traders, and they're

485
00:24:40,000 --> 00:24:43,840
Speaker 8: paying ten times more than the actual price of the

486
00:24:43,960 --> 00:24:46,560
Speaker 8: underlying assets, so there is definitely a chase to do that.

487
00:24:46,840 --> 00:24:49,280
Speaker 8: We also have a few big names like traditional stock

488
00:24:49,320 --> 00:24:53,159
Speaker 8: pickers like Ron Barron, which famously bets on Tessa. He

489
00:24:53,240 --> 00:24:56,280
Speaker 8: invests in SpaceX, and he was actually flat on the year,

490
00:24:56,720 --> 00:24:58,800
Speaker 8: and just in a couple of weeks now he's up

491
00:24:58,960 --> 00:25:02,040
Speaker 8: forty percent on the year, So really massive change for

492
00:25:02,160 --> 00:25:05,520
Speaker 8: everyone who placed the boat bet on anything New and Musk.

493
00:25:05,920 --> 00:25:08,920
Speaker 2: I wonder to what extent. This depends on a close

494
00:25:08,960 --> 00:25:12,800
Speaker 2: relationship with the president elect and what happens if this

495
00:25:12,960 --> 00:25:17,520
Speaker 2: relationship sours given the increase that we've seen in such

496
00:25:17,520 --> 00:25:19,240
Speaker 2: a short time, for sure.

497
00:25:19,160 --> 00:25:21,160
Speaker 1: Yeah, a lot of the speculation, a lot of the

498
00:25:21,359 --> 00:25:24,199
Speaker 1: rally we have seen lately, it is based on the

499
00:25:24,240 --> 00:25:28,879
Speaker 1: new cycle we've seen. We've seen obviously SpaceX get a

500
00:25:28,880 --> 00:25:32,160
Speaker 1: lot of its contracts, our government contracts, so you can imagine.

501
00:25:31,800 --> 00:25:34,960
Speaker 8: People are quite happy with that. Even the elimination of

502
00:25:35,000 --> 00:25:38,919
Speaker 8: the tax credits for electric vehicles, which came as news,

503
00:25:39,040 --> 00:25:41,000
Speaker 8: a lot of people are thinking that's going to be

504
00:25:41,040 --> 00:25:45,800
Speaker 8: favorable for tests. So a lot of the incoming administration

505
00:25:46,000 --> 00:25:48,640
Speaker 8: news cycles we have seen has been perceived to be

506
00:25:48,760 --> 00:25:52,359
Speaker 8: quite favorable for those companies. And you can imagine, like

507
00:25:52,680 --> 00:25:55,679
Speaker 8: more broadly, the rally, we're seeing a little bit of

508
00:25:56,800 --> 00:25:58,440
Speaker 8: a stop in the moment. We're seeing a lot of

509
00:25:58,440 --> 00:26:01,800
Speaker 8: the big company struggle. But Teslo continues to score gains,

510
00:26:01,800 --> 00:26:04,440
Speaker 8: and the gains have been incredible. Tesso has added more

511
00:26:04,480 --> 00:26:08,000
Speaker 8: than five hundred billions. Is the election just incredible rallity?

512
00:26:08,080 --> 00:26:11,240
Speaker 2: Yeah, it's pretty remarkable. And Elon Musk of course remains

513
00:26:11,240 --> 00:26:13,480
Speaker 2: the world's wealthiest person. But sur past four hundred billion

514
00:26:13,520 --> 00:26:16,480
Speaker 2: dollars in net Worth just this week, Dniita Sikova. Always

515
00:26:16,480 --> 00:26:19,240
Speaker 2: appreciate you joining us, Thanks so much well. Elon Musk's

516
00:26:19,240 --> 00:26:22,240
Speaker 2: influence looms large on the next administration, even heading the

517
00:26:22,320 --> 00:26:25,440
Speaker 2: newly created Department of Government Efficiency. Yes, we know what's

518
00:26:25,480 --> 00:26:29,520
Speaker 2: called DOGE. With the incoming Trump administration showing strong support

519
00:26:29,560 --> 00:26:33,320
Speaker 2: for crypto, let's bring in Aya Kantarovich, co CEO and

520
00:26:33,400 --> 00:26:36,760
Speaker 2: co founder of the digital assets management platform August for

521
00:26:36,840 --> 00:26:39,520
Speaker 2: her read on crypto markets in at twenty twenty five.

522
00:26:40,040 --> 00:26:42,840
Speaker 2: So the amazing run up that we've seen in many

523
00:26:42,840 --> 00:26:46,800
Speaker 2: different cryptocurrencies, but namely Bitcoin, over the last few months

524
00:26:47,160 --> 00:26:50,199
Speaker 2: has been on hopes of a Trump administration that is

525
00:26:50,240 --> 00:26:53,920
Speaker 2: more lenient when it comes to regulations. So that's the hope.

526
00:26:54,160 --> 00:26:56,520
Speaker 2: Now the administration has to deliver. What do you want

527
00:26:56,520 --> 00:26:58,600
Speaker 2: to say, Yeah, you're absolutely right.

528
00:26:58,640 --> 00:26:59,199
Speaker 10: You know.

529
00:26:59,240 --> 00:27:01,480
Speaker 11: We even saw it yesterday with Trump at the New

530
00:27:01,560 --> 00:27:04,520
Speaker 11: York Stock Exchange. He mentioned that he wants the United

531
00:27:04,560 --> 00:27:07,159
Speaker 11: States to be the number one leader in cryptocurrency in

532
00:27:07,200 --> 00:27:09,600
Speaker 11: the world. That's a very different narrative than what we've

533
00:27:09,600 --> 00:27:11,879
Speaker 11: seen in the last four years. We've also seen the

534
00:27:11,880 --> 00:27:14,919
Speaker 11: Trump administration anchor on this one hundred and fifty k

535
00:27:15,320 --> 00:27:17,879
Speaker 11: bitcoin price, and so we've seen, you know, markets respond

536
00:27:17,920 --> 00:27:20,200
Speaker 11: to that. We've seen a lot of option call buyers

537
00:27:20,200 --> 00:27:22,760
Speaker 11: with March twenty twenty five expirees, and so really a

538
00:27:22,760 --> 00:27:25,440
Speaker 11: lot of people, as you mentioned, are kind of basing

539
00:27:25,480 --> 00:27:29,720
Speaker 11: their expectation on a much more favorable administration. Now that

540
00:27:29,760 --> 00:27:33,160
Speaker 11: can be you know, many subsets. We see Paul Atkins

541
00:27:33,160 --> 00:27:36,639
Speaker 11: coming in as the SEC Chairman and commissioner, and that

542
00:27:36,800 --> 00:27:40,119
Speaker 11: is going to be very positive for crypto companies that

543
00:27:40,160 --> 00:27:43,000
Speaker 11: are centralized. We still need to see what that means

544
00:27:43,000 --> 00:27:46,320
Speaker 11: for decentralized finance as well, especially as it pertains to

545
00:27:46,359 --> 00:27:49,280
Speaker 11: KISEE sanctions. But overall, it really does mean that the

546
00:27:49,359 --> 00:27:51,880
Speaker 11: narrative is front and center, and you're seeing that momentum

547
00:27:51,880 --> 00:27:52,920
Speaker 11: in ETF inflows.

548
00:27:52,960 --> 00:27:54,520
Speaker 2: Does it seem like the wild like it could become

549
00:27:54,560 --> 00:27:55,399
Speaker 2: the wild West? To you?

550
00:27:56,480 --> 00:27:58,640
Speaker 11: We're very much hoping that we're actually going to get

551
00:27:58,760 --> 00:28:01,240
Speaker 11: very clear guidelines and I think that's one of the

552
00:28:01,280 --> 00:28:04,440
Speaker 11: main pieces of also having a role within the White

553
00:28:04,440 --> 00:28:06,520
Speaker 11: House that is focused on crypto. You know, you have

554
00:28:06,600 --> 00:28:08,760
Speaker 11: David Zachs who's going to be spearheading a lot of

555
00:28:08,800 --> 00:28:11,119
Speaker 11: that and what we're actually looking to get from that,

556
00:28:11,359 --> 00:28:13,320
Speaker 11: I mean, he's invested in a bunch of these companies,

557
00:28:13,359 --> 00:28:16,000
Speaker 11: is actually rules and regulations on what we need to do.

558
00:28:16,000 --> 00:28:17,560
Speaker 2: Do you see that as a conflict of interest that

559
00:28:17,600 --> 00:28:19,520
Speaker 2: he's invested in a lot of these companies, but he's

560
00:28:19,520 --> 00:28:21,879
Speaker 2: going to help advise the President and at least people

561
00:28:21,880 --> 00:28:24,040
Speaker 2: in the White House on making rules around these I.

562
00:28:23,960 --> 00:28:25,800
Speaker 11: Think you could probably say that about you know, a

563
00:28:25,800 --> 00:28:28,960
Speaker 11: couple people that you know are advising in the administration.

564
00:28:29,080 --> 00:28:30,800
Speaker 11: But that said, you know, you still need to have

565
00:28:30,840 --> 00:28:33,040
Speaker 11: all of this get approved by Congress. You need to

566
00:28:33,080 --> 00:28:34,919
Speaker 11: have it approved also on a state level, and so

567
00:28:34,960 --> 00:28:38,280
Speaker 11: you're seeing a lot of states actually start to jumpstart this.

568
00:28:38,400 --> 00:28:41,479
Speaker 11: And so you're seeing states such as Texas most recently

569
00:28:41,520 --> 00:28:43,360
Speaker 11: this week, say that they want to have bitcoin as

570
00:28:43,400 --> 00:28:45,920
Speaker 11: a reserve currency for the state. The US has spoken

571
00:28:45,920 --> 00:28:48,200
Speaker 11: about it. You're seeing a number of states now four

572
00:28:48,680 --> 00:28:51,040
Speaker 11: actually say that they're going to go ahead and do that.

573
00:28:51,160 --> 00:28:52,840
Speaker 11: And so I think you'll see a lot of the

574
00:28:52,920 --> 00:28:55,360
Speaker 11: checks and balances on both a state and federal level,

575
00:28:55,560 --> 00:28:57,000
Speaker 11: and we're excited to see that play out.

576
00:28:57,320 --> 00:29:00,840
Speaker 2: And recent Horowitz is crypto policy lead Brian Quintez is

577
00:29:00,880 --> 00:29:04,400
Speaker 2: a top contender to lead the CFTC under President lex Trump.

578
00:29:05,120 --> 00:29:06,920
Speaker 2: What kind of role do you see that he would

579
00:29:06,920 --> 00:29:08,360
Speaker 2: play in shaping cryptopolicy.

580
00:29:09,080 --> 00:29:12,240
Speaker 11: He's been pretty favorable in both what he said very

581
00:29:12,240 --> 00:29:14,600
Speaker 11: publicly and also in the guidance that he's given for

582
00:29:14,880 --> 00:29:17,520
Speaker 11: a lot of the A sixteen Z companies. For example,

583
00:29:17,600 --> 00:29:20,600
Speaker 11: UNISWAP is one of the largest ones that's a decentralized

584
00:29:20,600 --> 00:29:23,120
Speaker 11: exchange platform. It touches a number of users, and I

585
00:29:23,160 --> 00:29:25,200
Speaker 11: think what you'll see is that a lot of these

586
00:29:25,200 --> 00:29:29,000
Speaker 11: currencies will fall under the CFDC. CFDC has given very

587
00:29:29,000 --> 00:29:31,400
Speaker 11: clear guidelines and so we're very excited to continue to

588
00:29:31,440 --> 00:29:32,800
Speaker 11: push in partnership with them.

589
00:29:32,840 --> 00:29:34,600
Speaker 2: Are you concerned that there could be clear winners and

590
00:29:34,640 --> 00:29:38,600
Speaker 2: losers here given that there are people from certain venture

591
00:29:38,640 --> 00:29:42,280
Speaker 2: capital firms who have the presidentallex Ear, Elon Musk has

592
00:29:42,320 --> 00:29:45,520
Speaker 2: the president of x ear, but not everybody is going

593
00:29:45,560 --> 00:29:47,200
Speaker 2: to have his ear. Are there are there going to

594
00:29:47,200 --> 00:29:49,120
Speaker 2: be clear winners and losers as a result of who

595
00:29:49,160 --> 00:29:49,760
Speaker 2: has access.

596
00:29:50,120 --> 00:29:51,840
Speaker 11: That's a very very good question, and I think it

597
00:29:51,920 --> 00:29:54,719
Speaker 11: still boils down to what are the guidelines and rules?

598
00:29:54,720 --> 00:29:56,800
Speaker 11: So if you do pick, you know, call it a

599
00:29:56,840 --> 00:30:01,240
Speaker 11: clear winner based on someone's relationship with a specific company

600
00:30:01,520 --> 00:30:05,240
Speaker 11: or their previous investments. It really depends on why is

601
00:30:05,240 --> 00:30:07,920
Speaker 11: it a commodity? Is it a security? And then boiling

602
00:30:07,960 --> 00:30:09,720
Speaker 11: that down and then we can take that guideline and

603
00:30:09,720 --> 00:30:11,680
Speaker 11: apply that to many other winners as well.

604
00:30:11,800 --> 00:30:15,200
Speaker 2: Ayah, what happens if there is some sort of meltdown

605
00:30:15,200 --> 00:30:17,920
Speaker 2: akin to what we saw at FTX two years ago

606
00:30:18,560 --> 00:30:21,120
Speaker 2: in the coming years and you see a large number

607
00:30:21,520 --> 00:30:26,600
Speaker 2: of people who have holdings of cryptocurrencies get burned. Maybe

608
00:30:26,640 --> 00:30:32,320
Speaker 2: it's the result of a more lax regulatory environment. The

609
00:30:32,360 --> 00:30:34,400
Speaker 2: whole idea with regulations is these are supposed to be

610
00:30:34,400 --> 00:30:38,000
Speaker 2: guardrails and protect consumers. Does this whole thing backfire if

611
00:30:38,040 --> 00:30:39,040
Speaker 2: consumers get burned?

612
00:30:39,680 --> 00:30:41,800
Speaker 11: So my personal opinion, and I think that of the

613
00:30:41,840 --> 00:30:44,120
Speaker 11: industry is not a lot of the things that happened

614
00:30:44,120 --> 00:30:48,120
Speaker 11: with FTX were personal people issues and people management issues

615
00:30:48,160 --> 00:30:51,920
Speaker 11: and lack of operational back end systems in order that

616
00:30:51,960 --> 00:30:55,640
Speaker 11: you see both in traditional finance but also in centralized exchanges.

617
00:30:55,720 --> 00:30:57,600
Speaker 2: That may be true, but it didn't happen in a vacuum.

618
00:30:57,600 --> 00:30:59,160
Speaker 2: We saw the failure of a lot of crypto firms

619
00:30:59,240 --> 00:31:01,760
Speaker 2: during that time. We saw the real depression of many

620
00:31:01,760 --> 00:31:04,040
Speaker 2: crypto asset prices can one.

621
00:31:03,960 --> 00:31:07,240
Speaker 11: Hundred percent agree. We also saw that in traditional finance

622
00:31:07,240 --> 00:31:10,160
Speaker 11: with our Kegoes for example, and that took down Credit Suite.

623
00:31:10,240 --> 00:31:13,400
Speaker 11: So it's not unique to crypto. These are still financial

624
00:31:13,440 --> 00:31:17,720
Speaker 11: companies and they still require very clear guidelines on operations,

625
00:31:17,840 --> 00:31:20,480
Speaker 11: on people management, and on flow funds. And I think

626
00:31:20,480 --> 00:31:23,000
Speaker 11: what we're going to get from this administration is exactly

627
00:31:23,000 --> 00:31:24,960
Speaker 11: what that needs to look like in the United States.

628
00:31:25,160 --> 00:31:27,960
Speaker 11: We can copypaste that into these companies and then we can,

629
00:31:28,160 --> 00:31:29,560
Speaker 11: you know, with that clear guideline.

630
00:31:29,560 --> 00:31:30,280
Speaker 12: That's the issue.

631
00:31:30,360 --> 00:31:32,640
Speaker 11: Since we don't have the clear guidelines, we don't really

632
00:31:32,680 --> 00:31:35,400
Speaker 11: know how and where to operate, and that creates more confusion.

633
00:31:35,960 --> 00:31:38,560
Speaker 11: Even with less regulation, as long as the guidelines are

634
00:31:38,720 --> 00:31:41,880
Speaker 11: very clear, we can operate within those, hire the right people,

635
00:31:42,440 --> 00:31:45,880
Speaker 11: whether it's for compliance or again back in operations and

636
00:31:45,920 --> 00:31:46,640
Speaker 11: continue forward.

637
00:31:46,760 --> 00:31:48,760
Speaker 2: What are you seeing on August platform right now, Like,

638
00:31:48,760 --> 00:31:50,560
Speaker 2: what's the activity that you see that you can tell

639
00:31:50,640 --> 00:31:51,040
Speaker 2: us about.

640
00:31:51,280 --> 00:31:54,720
Speaker 11: Yes, our volumes have really spiked tremendously. It's very very exciting.

641
00:31:54,840 --> 00:31:57,280
Speaker 11: You know, yields are spiking, and so we're seeing, for example,

642
00:31:57,280 --> 00:32:00,200
Speaker 11: our clients get yields over five percent on bitcoin and

643
00:32:00,280 --> 00:32:03,400
Speaker 11: majors on basis. Right now, we're seeing roughly eleven percent

644
00:32:03,440 --> 00:32:06,280
Speaker 11: for majors, over twenty five percent for some all coins,

645
00:32:06,480 --> 00:32:10,120
Speaker 11: and then even for for example, lending rates for stable coins,

646
00:32:10,120 --> 00:32:13,360
Speaker 11: the seven day average is around sixteen percent. So it's

647
00:32:13,400 --> 00:32:15,720
Speaker 11: really tracting more capital on chain and we're excited to

648
00:32:15,720 --> 00:32:16,480
Speaker 11: continue to see that.

649
00:32:16,840 --> 00:32:18,400
Speaker 2: I always get to see you. Thanks so much for

650
00:32:18,480 --> 00:32:22,680
Speaker 2: stopping by Bloomberg HQ. That's August CEO Aya Kantorovitch joining

651
00:32:22,720 --> 00:32:26,440
Speaker 2: us here at Bloomberg. Well, coming up, Archer teaming up

652
00:32:26,480 --> 00:32:30,040
Speaker 2: with Anderill. Archer CEO Adam Goldstein joins us. Next for more,

653
00:32:30,200 --> 00:32:50,760
Speaker 2: This is Bloomberg. Archer, the electric aircraft maker, has a

654
00:32:50,760 --> 00:32:53,680
Speaker 2: new partnership with defense tech firm Anderill to build a

655
00:32:53,760 --> 00:32:56,880
Speaker 2: hybrid at military aircraft. This as the company also announced

656
00:32:56,920 --> 00:32:59,280
Speaker 2: it has brought in four hundred and thirty million dollars

657
00:32:59,320 --> 00:33:03,560
Speaker 2: from investors including Stillantis and United Airlines. Archer CEO Adam

658
00:33:03,600 --> 00:33:06,280
Speaker 2: Goldstein joins us now. Adam, I think a lot of

659
00:33:06,280 --> 00:33:09,239
Speaker 2: people when they envision Archer, when they hear Archer, they

660
00:33:09,280 --> 00:33:12,760
Speaker 2: think of air taxis, they think of urban mobility. What

661
00:33:12,920 --> 00:33:14,600
Speaker 2: is the opportunity and defense for Archer?

662
00:33:16,040 --> 00:33:19,160
Speaker 12: Yeah, well, I think it's quite common for aircraft manufacturers

663
00:33:19,200 --> 00:33:22,480
Speaker 12: to participate in both the commercial aspects of the industry

664
00:33:22,520 --> 00:33:25,640
Speaker 12: as well as the defense aspects. The commercial side of

665
00:33:25,720 --> 00:33:28,080
Speaker 12: Archer's business has become very mature, and the aircraft is

666
00:33:28,080 --> 00:33:31,000
Speaker 12: in the late stages of its development and certification program,

667
00:33:31,200 --> 00:33:33,120
Speaker 12: and so it was a great opportunity for us to

668
00:33:33,160 --> 00:33:36,680
Speaker 12: really extend and expand our capabilities and move into the

669
00:33:36,720 --> 00:33:39,960
Speaker 12: defense side. And of course partnering with Androl is an

670
00:33:40,040 --> 00:33:43,360
Speaker 12: amazing opportunity as they're the premier defense tech company in

671
00:33:43,400 --> 00:33:43,720
Speaker 12: the world.

672
00:33:43,760 --> 00:33:46,120
Speaker 2: So what does that product look like when it's all

673
00:33:46,160 --> 00:33:48,800
Speaker 2: said and done in partnership with Androl.

674
00:33:49,720 --> 00:33:53,840
Speaker 12: So we're building a hybrid electric vertical takeoff and landing aircraft.

675
00:33:54,360 --> 00:33:56,640
Speaker 12: It will have a lot of the same capabilities that

676
00:33:56,680 --> 00:33:58,880
Speaker 12: you've seen on the commercial side. So these are vehicles

677
00:33:58,880 --> 00:34:01,520
Speaker 12: that can be produced at much lower costs. There are

678
00:34:01,600 --> 00:34:05,000
Speaker 12: vehicles that have low acoustic, low thermal signatures, and so

679
00:34:05,200 --> 00:34:10,400
Speaker 12: applications that will be very helpful towards defense vehicles. I

680
00:34:10,400 --> 00:34:13,759
Speaker 12: think it's also really important to the US Department of

681
00:34:13,760 --> 00:34:16,399
Speaker 12: Defense that we add new capabilities. There's this whole new

682
00:34:16,440 --> 00:34:19,879
Speaker 12: trend in affordable autonomous aircraft that can help bring new

683
00:34:19,920 --> 00:34:23,000
Speaker 12: capabilities but also at the same time dramatically lower costs.

684
00:34:23,320 --> 00:34:25,320
Speaker 2: You've been working with the Department of Defense for a

685
00:34:25,360 --> 00:34:27,560
Speaker 2: few years, going back to twenty twenty one, but now

686
00:34:27,600 --> 00:34:31,239
Speaker 2: you're just creating this separate defense division. Why are you

687
00:34:31,280 --> 00:34:34,319
Speaker 2: doing it now and what's different about defense tech going

688
00:34:34,320 --> 00:34:36,680
Speaker 2: into twenty twenty five. Is this about a new administration?

689
00:34:38,239 --> 00:34:41,440
Speaker 12: Yeah, So Archer has a team of around one thousand people,

690
00:34:41,480 --> 00:34:43,520
Speaker 12: and we've been working for a long time on building

691
00:34:43,560 --> 00:34:46,640
Speaker 12: out the capabilities of our aircraft. As the aircraft matured,

692
00:34:46,719 --> 00:34:49,200
Speaker 12: it allows us to take that platform and build variants

693
00:34:49,239 --> 00:34:51,920
Speaker 12: of it that can be useful across different applications. You

694
00:34:51,960 --> 00:34:54,359
Speaker 12: combine that with the new administration and you have an

695
00:34:54,360 --> 00:34:57,839
Speaker 12: incredible opportunity for us to dramatically expand our business. So

696
00:34:58,040 --> 00:35:00,640
Speaker 12: on the commercial side, it can be certainly very big,

697
00:35:01,200 --> 00:35:03,520
Speaker 12: but it also is for some people hard to define.

698
00:35:03,680 --> 00:35:06,560
Speaker 12: On the defense side, it's very clear that there are

699
00:35:06,640 --> 00:35:10,480
Speaker 12: new needs that the Defense Department is looking for and

700
00:35:10,520 --> 00:35:13,000
Speaker 12: we can certainly fill those as well. So the opportunity

701
00:35:13,040 --> 00:35:14,880
Speaker 12: here really is pretty impressive.

702
00:35:14,960 --> 00:35:16,839
Speaker 2: What's the type of infrastructure that has to be in

703
00:35:16,880 --> 00:35:21,799
Speaker 2: place for the Defense Department at bases here and at

704
00:35:22,200 --> 00:35:25,160
Speaker 2: outposts around the world in order for this product to

705
00:35:25,200 --> 00:35:27,239
Speaker 2: succeed well.

706
00:35:27,280 --> 00:35:29,920
Speaker 12: The beauty is that they're vertical takeoff and landing aircraft,

707
00:35:29,960 --> 00:35:32,560
Speaker 12: which means we don't need runways. And so that's one

708
00:35:32,560 --> 00:35:34,680
Speaker 12: of the big benefits that you can have these aircraft

709
00:35:34,880 --> 00:35:37,560
Speaker 12: that could be utilized across many different applications. So you

710
00:35:37,560 --> 00:35:40,160
Speaker 12: can think about all things that helicopters do, and then

711
00:35:40,200 --> 00:35:42,800
Speaker 12: there's certainly things that you can envision that go beyond

712
00:35:42,800 --> 00:35:45,360
Speaker 12: those use cases. So when you don't need runways, you

713
00:35:45,400 --> 00:35:46,600
Speaker 12: need limited infrastructure.

714
00:35:47,320 --> 00:35:48,960
Speaker 2: I look up at the sky in New York City

715
00:35:50,200 --> 00:35:54,640
Speaker 2: and I see airplanes from bowling In, Airbus and Breyer

716
00:35:55,080 --> 00:35:58,520
Speaker 2: and the like. I still don't see air taxis. When

717
00:35:58,520 --> 00:36:00,399
Speaker 2: will I see air taxis?

718
00:36:01,239 --> 00:36:03,640
Speaker 12: Well, the air taxis will come to the US as

719
00:36:03,640 --> 00:36:07,000
Speaker 12: soon as the regulatory pathway is clear. And one of

720
00:36:07,000 --> 00:36:09,880
Speaker 12: the benefits of the new administration is that they are

721
00:36:10,239 --> 00:36:12,319
Speaker 12: projecting that there will be an easier time to get

722
00:36:12,360 --> 00:36:14,920
Speaker 12: through some of the regulatory pathways. That being said, it

723
00:36:14,960 --> 00:36:16,520
Speaker 12: is still up to Archer to make sure that we

724
00:36:16,600 --> 00:36:19,040
Speaker 12: produce a safe aircraft, and that's where we really focus,

725
00:36:19,480 --> 00:36:21,400
Speaker 12: and I think you'll start to see things sooner than

726
00:36:21,440 --> 00:36:22,160
Speaker 12: you might expect.

727
00:36:22,480 --> 00:36:24,160
Speaker 2: What sooner than you and I expect. What does that

728
00:36:24,200 --> 00:36:25,960
Speaker 2: mean in terms of number of years? Am I counting

729
00:36:25,960 --> 00:36:26,920
Speaker 2: on one hand?

730
00:36:27,840 --> 00:36:28,000
Speaker 13: Oh?

731
00:36:28,080 --> 00:36:28,800
Speaker 3: Yeah, absolutely.

732
00:36:28,840 --> 00:36:31,960
Speaker 12: Our goal is to have aircraft commercial in the marketplace

733
00:36:32,000 --> 00:36:32,919
Speaker 12: by the end of next year.

734
00:36:34,040 --> 00:36:35,000
Speaker 2: And where would that be.

735
00:36:36,320 --> 00:36:38,440
Speaker 12: Well, the starting point is in the UAE. So the

736
00:36:38,520 --> 00:36:41,000
Speaker 12: UE has created a framework for us to get to

737
00:36:41,080 --> 00:36:43,120
Speaker 12: market by the fourth quarter of next year, and so

738
00:36:43,160 --> 00:36:46,040
Speaker 12: we've been working very closely with the regulators there.

739
00:36:46,120 --> 00:36:47,399
Speaker 2: But I do think you'll start to.

740
00:36:47,360 --> 00:36:52,480
Speaker 12: See an increasing amount of excitement coming from the FAA

741
00:36:52,520 --> 00:36:54,719
Speaker 12: as these products get a lot of hours under them

742
00:36:54,719 --> 00:36:57,759
Speaker 12: in flight tests and really advanced in the certification programs,

743
00:36:57,960 --> 00:36:59,680
Speaker 12: And so my guess it will be a short time

744
00:36:59,680 --> 00:37:01,799
Speaker 12: after to just see these aircraft come to market in

745
00:37:01,800 --> 00:37:02,240
Speaker 12: the US.

746
00:37:02,280 --> 00:37:03,799
Speaker 2: And if they do come or when they do come

747
00:37:03,800 --> 00:37:05,600
Speaker 2: to market in the US, give us a year that

748
00:37:05,600 --> 00:37:07,160
Speaker 2: you think it would happen if all goes according to

749
00:37:07,160 --> 00:37:09,719
Speaker 2: a plan from a regulatory perspective, and where we'll see

750
00:37:09,719 --> 00:37:11,640
Speaker 2: it in the US? What city, what state will this

751
00:37:11,680 --> 00:37:12,280
Speaker 2: happen first?

752
00:37:13,480 --> 00:37:16,480
Speaker 12: Yeah, So we've announced several key markets that are important

753
00:37:16,520 --> 00:37:20,120
Speaker 12: to US. LA is a fantastic market that are over

754
00:37:20,440 --> 00:37:24,040
Speaker 12: five million daily trips that take greater than an hour

755
00:37:24,200 --> 00:37:26,400
Speaker 12: by car going less than twenty miles. So when you

756
00:37:26,400 --> 00:37:28,520
Speaker 12: start to think about that, just the city of La

757
00:37:28,600 --> 00:37:32,200
Speaker 12: alone could be bigger than the entire aviation industry globally.

758
00:37:32,520 --> 00:37:34,040
Speaker 12: And then you start to think about the other big

759
00:37:34,040 --> 00:37:37,640
Speaker 12: markets in the US that we concentrate on New York, Miami,

760
00:37:38,000 --> 00:37:41,040
Speaker 12: and so there's an amazing opportunity here. It's our job

761
00:37:41,080 --> 00:37:43,839
Speaker 12: to build safe aircraft and once the regulators d must safe,

762
00:37:43,880 --> 00:37:45,640
Speaker 12: and that's when we'll ultimately get to market.

763
00:37:45,840 --> 00:37:48,520
Speaker 2: Archer CEO Adam Goldstein, Adam, good to talk to you.

764
00:37:48,560 --> 00:37:58,920
Speaker 2: Thanks for checking in. Do appreciate it. San Francisco has

765
00:37:58,920 --> 00:38:01,240
Speaker 2: been at the center of the boom, yet the city

766
00:38:01,560 --> 00:38:05,359
Speaker 2: still running up against its issues. Locally, Carolin Hyde sat

767
00:38:05,440 --> 00:38:08,719
Speaker 2: down with San Francisco Mayor elect Daniel Lurie to discuss

768
00:38:08,760 --> 00:38:11,000
Speaker 2: the future of the city under the new age of AI.

769
00:38:11,600 --> 00:38:14,839
Speaker 2: This after he assembled a transition team that includes Open

770
00:38:14,880 --> 00:38:16,919
Speaker 2: AI co founder Sam Alman. Check it out.

771
00:38:17,400 --> 00:38:21,160
Speaker 14: Sam Alman has been great as a transition code chair.

772
00:38:22,040 --> 00:38:25,480
Speaker 14: We are committed to leaning into being the home of AI.

773
00:38:26,239 --> 00:38:30,680
Speaker 14: We have historic investments already here in San Francisco. We're

774
00:38:30,719 --> 00:38:34,600
Speaker 14: going to continue to lean in not only AI, not

775
00:38:34,719 --> 00:38:37,920
Speaker 14: only technology, but really once again being the epicenter for

776
00:38:38,160 --> 00:38:41,640
Speaker 14: business again. There is no better place to do business

777
00:38:41,880 --> 00:38:45,600
Speaker 14: on the globe than San Francisco when we're at our best.

778
00:38:46,120 --> 00:38:48,839
Speaker 14: But it's not just about business. It's about bringing our

779
00:38:48,960 --> 00:38:53,840
Speaker 14: arts and culture back to San Francisco, because that's where people.

780
00:38:54,120 --> 00:38:57,000
Speaker 14: When people think of San Francisco, they think of culture.

781
00:38:57,040 --> 00:39:01,280
Speaker 14: They think that everything starts here. Yes, I started here

782
00:39:01,320 --> 00:39:03,279
Speaker 14: and we wanted to grow here, but we kind of

783
00:39:03,320 --> 00:39:06,200
Speaker 14: want the best of everything coming back to San Francisco.

784
00:39:06,600 --> 00:39:09,239
Speaker 15: I mean, you're someone who knows well how to make

785
00:39:09,239 --> 00:39:13,399
Speaker 15: cultural events bound together, big cultural movement benefit concert raise

786
00:39:13,480 --> 00:39:15,759
Speaker 15: seventeen million dollars. You've done other philanthropic work. But you're

787
00:39:15,760 --> 00:39:19,200
Speaker 15: also from a business dynasty of Levi and what parts

788
00:39:19,239 --> 00:39:21,279
Speaker 15: of industry do you want to cultivate here? You just

789
00:39:21,320 --> 00:39:24,560
Speaker 15: mentioned financial services there, you mentioned sports, but it's going

790
00:39:24,640 --> 00:39:25,400
Speaker 15: to be broader than that.

791
00:39:26,120 --> 00:39:33,320
Speaker 14: Absolutely, we are calling healthcare executives, biotech AI, we want

792
00:39:33,600 --> 00:39:36,239
Speaker 14: real estate thinking that San Francisco is a place that

793
00:39:36,280 --> 00:39:39,720
Speaker 14: they want to invest in again. Because when you get

794
00:39:39,880 --> 00:39:42,920
Speaker 14: these business leaders back, what that tells me is that

795
00:39:42,960 --> 00:39:46,319
Speaker 14: we get the small businesses back to San Francisco, back

796
00:39:46,480 --> 00:39:47,280
Speaker 14: thriving again.

797
00:39:48,040 --> 00:39:50,920
Speaker 2: That was San Francisco's Mayor elect Daniel Lurie with Caroline

798
00:39:50,960 --> 00:39:54,240
Speaker 2: Hyde there and from San Francisco to Boston. Liquid AI

799
00:39:54,360 --> 00:39:58,480
Speaker 2: and MIT spinoff designing AI systems inspired by the tiny

800
00:39:58,520 --> 00:40:01,400
Speaker 2: brains of a worm, set to raise two hundred and

801
00:40:01,440 --> 00:40:04,320
Speaker 2: fifty million dollars in funding at a two point three

802
00:40:04,360 --> 00:40:08,320
Speaker 2: billion dollar valuation Bloomberg. Sharen Gafari joins US now for

803
00:40:08,480 --> 00:40:13,400
Speaker 2: moreen neural networks. Typically they're modeled after, you know, the

804
00:40:13,440 --> 00:40:16,040
Speaker 2: old human brain. These things that have proved to work

805
00:40:16,360 --> 00:40:18,600
Speaker 2: really well. What's up with worm brains? Why is this

806
00:40:18,640 --> 00:40:20,640
Speaker 2: an exciting new frontier? That's right.

807
00:40:20,719 --> 00:40:23,280
Speaker 13: So the neural networks of power things like chat ship

808
00:40:23,360 --> 00:40:26,360
Speaker 13: tee that we all use are loosely modeled off of

809
00:40:26,360 --> 00:40:29,400
Speaker 13: a human brain. However, there's a lot of complexities there.

810
00:40:29,560 --> 00:40:32,280
Speaker 13: The human brain has a lot of neurons. It's difficult

811
00:40:32,320 --> 00:40:34,759
Speaker 13: to understand. And so the idea is that a worm brain,

812
00:40:35,160 --> 00:40:37,640
Speaker 13: if you can still get some reasoning out of it,

813
00:40:38,160 --> 00:40:42,040
Speaker 13: might be simpler and actually more intuitive to study than

814
00:40:42,080 --> 00:40:43,800
Speaker 13: a more complex human brain like system.

815
00:40:43,880 --> 00:40:46,920
Speaker 2: But I thought worms were again not here. Not to

816
00:40:46,920 --> 00:40:50,560
Speaker 2: be a biologist, but aren't worms the type of creatures

817
00:40:50,560 --> 00:40:56,320
Speaker 2: that are incredibly simple and don't necessarily have reasoning capabilities

818
00:40:56,600 --> 00:40:59,520
Speaker 2: akin to other animals let's say a pig, for example.

819
00:41:00,080 --> 00:41:03,560
Speaker 2: Could a neural network designed after a worm brain actually

820
00:41:03,600 --> 00:41:05,399
Speaker 2: bring us in terms of AI?

821
00:41:06,120 --> 00:41:08,759
Speaker 13: Yeah, Look, it is still you know, experimental technology that

822
00:41:08,760 --> 00:41:11,600
Speaker 13: they're stealing up, but actually in some early research that

823
00:41:11,640 --> 00:41:15,440
Speaker 13: the founders did, they were showing that potentially this kind

824
00:41:15,480 --> 00:41:17,720
Speaker 13: of tech could be used to steer self driving cars

825
00:41:17,719 --> 00:41:21,479
Speaker 13: to help analyze that data. So there's big potential here

826
00:41:21,520 --> 00:41:23,719
Speaker 13: and you always have to be open to exploring you

827
00:41:23,880 --> 00:41:28,000
Speaker 13: and sometimes kind of almost incredible sounding models in AI.

828
00:41:28,080 --> 00:41:30,200
Speaker 13: And I think this is a reflection of investor interest

829
00:41:30,200 --> 00:41:33,440
Speaker 13: in going beyond kind of the standard transformer neural network

830
00:41:33,480 --> 00:41:34,560
Speaker 13: type models that we use just.

831
00:41:34,600 --> 00:41:37,200
Speaker 2: Envisioning a worm being driving a self driving car. But

832
00:41:37,440 --> 00:41:40,120
Speaker 2: that's neither here nor there. Some real money coming into

833
00:41:40,120 --> 00:41:44,080
Speaker 2: this in some established companies, not just vcs, but also

834
00:41:44,360 --> 00:41:47,600
Speaker 2: establish publicly traded firms that are betting big on this tech.

835
00:41:47,719 --> 00:41:50,680
Speaker 13: Who's there, that's right, So AMD is a lead investor,

836
00:41:51,920 --> 00:41:54,520
Speaker 13: and you know, again, I think this reflects sort of

837
00:41:54,560 --> 00:41:59,040
Speaker 13: the interests that we're seeing and going beyond what's been

838
00:41:59,080 --> 00:42:02,000
Speaker 13: out there for a while now, which are transformer based models.

839
00:42:03,000 --> 00:42:05,000
Speaker 2: You know, I think what would be sort of the

840
00:42:05,080 --> 00:42:08,200
Speaker 2: test to see when this technology or if this technology works,

841
00:42:08,239 --> 00:42:11,120
Speaker 2: because this is such a hefty valuation for something that

842
00:42:11,120 --> 00:42:13,120
Speaker 2: at this point is in the early stages. Or does

843
00:42:13,120 --> 00:42:15,880
Speaker 2: that just show that there's so much exuberance for AI

844
00:42:15,960 --> 00:42:16,399
Speaker 2: out there.

845
00:42:17,040 --> 00:42:18,600
Speaker 13: I think the proof will be in the putting about

846
00:42:18,640 --> 00:42:20,440
Speaker 13: these models. You know, there are some early tests that

847
00:42:20,440 --> 00:42:22,840
Speaker 13: they've brun. These are you know, benchmarks that they do internally,

848
00:42:22,920 --> 00:42:26,480
Speaker 13: seeing that on certain tasks this is competitive with some

849
00:42:26,520 --> 00:42:30,360
Speaker 13: of the similar sized, more traditional models out there. But again,

850
00:42:30,440 --> 00:42:32,279
Speaker 13: you know, it's one thing to test something in a lab.

851
00:42:32,320 --> 00:42:33,920
Speaker 13: It's another thing when you go out there and get

852
00:42:33,920 --> 00:42:36,840
Speaker 13: this product in front of people. Is it actually providing value?

853
00:42:36,840 --> 00:42:39,120
Speaker 13: I think that will be the ultimate sign of whether

854
00:42:39,239 --> 00:42:41,120
Speaker 13: this is going to work on a bigger scale.

855
00:42:41,160 --> 00:42:42,800
Speaker 2: Seren, always good to see you, Thanks so much for

856
00:42:42,880 --> 00:42:46,200
Speaker 2: joining us. Thank you, Bumberg Technology, Bloomberg. Serene Gafari here

857
00:42:46,200 --> 00:42:48,080
Speaker 2: in the studio that is going to do it for

858
00:42:48,120 --> 00:42:51,000
Speaker 2: this Faraday edition of a Bloomberg Technology. Don't forget to

859
00:42:51,080 --> 00:42:53,200
Speaker 2: check out our podcast. You can find it on the

860
00:42:53,280 --> 00:42:57,279
Speaker 2: terminal as well as online. On Apple, Spotify, and iHeart

861
00:42:57,520 --> 00:42:58,719
Speaker 2: this is Bloomberg.

862
00:42:59,160 --> 00:43:02,480
Speaker 13: Thank you wh