Speaker 1: From the heart where innovation, money and power. Collie in
Speaker 1: Silicon Valley, NBN. This is Bloomberg Technology with Caroline Hyde
Speaker 1: and Ed Ludlove.
Speaker 2: We are live from New York and San Francisco. This
Speaker 2: is Bloomberg Technology coming up. Open ai gets closer to
Speaker 2: a new AI model that reasons and a new mega
Speaker 2: valuation of one hundred and fifty billion dollars.
Speaker 3: An inteler at a crossroads, the chipmaker reaching a pivotal
Speaker 3: moment with a decade of dominance at risk.
Speaker 2: And the first commercial spacewalk plaras Dawn hits mission goals
Speaker 2: seven hundred kilometers above the Earth. But first, let's just
Speaker 2: check in on these markets, because we are rallying once again,
Speaker 2: four straight days agains on then aw's that one hundred
Speaker 2: I'm looking at ED four and a half the high
Speaker 2: we add a trillion dollars in large part because some
Speaker 2: single names like in video, but in video is also
Speaker 2: linked to the world of artificial intelligence and exactly where
Speaker 2: we want to dig in on.
Speaker 3: Yeah, let's get to our top story. Open ai is
Speaker 3: in talks to raise six point five billion dollars from investors,
Speaker 3: catapulting the AI startup to a one hundred and fifty
Speaker 3: billion dollar valuation. This is the company gets ready to
Speaker 3: release its latest AI model, code named Strawberry. For more Bloombergs,
Speaker 3: Rachel Metz joins us and Rachel You and I working
Speaker 3: with Gillian tan mark Bergen on reporting this primary round
Speaker 3: and long story short, one hundred and fifty billion dollars
Speaker 3: is a very big number in terms of valuation. What
Speaker 3: do we know about open AI's latest fundraise.
Speaker 4: Well, we know that they are trying to raise quite
Speaker 4: a bit of money, and they're also trying to raise
Speaker 4: an amount in the form of debt. And then as
Speaker 4: as you and I and some of our colleagues reported
Speaker 4: that they are hoping to do this at quite a
Speaker 4: high valuation. This would be on hundred fifty billion, would
Speaker 4: be much higher than the amount that we've previously reported,
Speaker 4: which was under one hundred million, sorry, under one hundred billion.
Speaker 4: And I mean, I think we have to think about
Speaker 4: when we think about this company trying to raise a
Speaker 4: lot of money, is that what you're doing is extremely expensive.
Speaker 4: I mean, they are building enormous AI systems and they're
Speaker 4: running enormous AI systems, and that costs a lot of money.
Speaker 2: Let's just talk about where the money is being spent.
Speaker 2: The latest model Strawberry. This is where training of these
Speaker 2: models the compute the talent, but what's the outcome.
Speaker 4: So Strawberry is a model that's been in the works
Speaker 4: for a while, and essentially what they are hoping that
Speaker 4: it can do is some tasks that are similar to
Speaker 4: how humans would conduct reasoning. It's going to be aimed
Speaker 4: at things like more complicated math and coding questions and
Speaker 4: prompts than have been possible in the past. Source that
Speaker 4: I spoke to that has tried it out said it
Speaker 4: was able to solve a problem that's been kind of
Speaker 4: popular on social media lately. Is nine point one point
Speaker 4: one larger than nine point nine, which is the kind
Speaker 4: of thing that a human might find simple but convex computers.
Speaker 3: The other thing we reported rachel our sources telling us
Speaker 3: that open ais one to the banks and is looking
Speaker 3: at doing about five billion dollars of debt in the
Speaker 3: form of a revolving credit line. It's not sort of unusual,
Speaker 3: but it makes me think that open ai is kind
Speaker 3: of getting to company scale. We keep calling it a startup,
Speaker 3: but do we actually have any sense of how much
Speaker 3: money all of this technology is bringing in for them.
Speaker 3: How much of a business they have beyond just constant
Speaker 3: R and D and new model innovation.
Speaker 4: Yeah, they actually have been able to scale their business
Speaker 4: quite a bit over the past year. They've released several
Speaker 4: different enterprise products, and we actually know from our recent
Speaker 4: reporting that they reached over they reached a milestone in
Speaker 4: terms of how many people are using their enterprise versions
Speaker 4: of chat GBT. This would be individual users, not customers.
Speaker 4: So if they're able to keep growing and growing on
Speaker 4: that side, then they're bringing in lots of money. So
Speaker 4: the money that they're raising, perhaps that could be there'd
Speaker 4: be a little less pressure on that.
Speaker 3: Bloombost Rachel Mets brilliant reporting, deep reporting, and something that
Speaker 3: a lot of people talking about online as well. Thank
Speaker 3: you very much. Now, this week is a pivotal one
Speaker 3: for Intel. Intel's board has been weighing how to move
Speaker 3: forward after its latest earnings report and plans to slash
Speaker 3: fifteen thousand job which leaves Intel with a few options,
Speaker 3: including scaling back some of its multi billion dollar factory projects,
Speaker 3: selling off subsidiaries, or splitting Intel's core operations into separate
Speaker 3: units or companies. Bloomberg's Ian King pend this big take
Speaker 3: and actually you kind of get it all in the
Speaker 3: first paragraph is slow motion disaster. Where are they in
Speaker 3: the slow motion action that's happening.
Speaker 5: It's been tough for a while, right, They've been trying
Speaker 5: to do too fundamentally competing things, which is to spend
Speaker 5: a lot of money on restoring this company to where
Speaker 5: it was at a time when business has turned against
Speaker 5: them and away from them.
Speaker 2: And in just jumping in here, what's so interesting is
Speaker 2: what's on the exact agenda over these three days which
Speaker 2: culminates today. Pat Gelsinger in any trouble here.
Speaker 5: Yeah, I mean not according to our reporting. As you
Speaker 5: saw in the story. One of the sources that we
Speaker 5: spoke to said that that's not the kind of board
Speaker 5: meeting that we're up to at this particular point. What
Speaker 5: we're up to is looking at what Intel does. It's
Speaker 5: a huge company, one hundred thousand people, what it does,
Speaker 5: where it's focusing, where it's spending, to look at perhaps
Speaker 5: discontinuing some of the things that are a little bit
Speaker 5: peripheral to save some money to focus on trying to
Speaker 5: push that plan. And that's Pat Gelsinger's plan forward at
Speaker 5: this point that's kind of where we are.
Speaker 3: As best you can then take us inside the room
Speaker 3: of the board meeting and kind of of all the
Speaker 3: options available to them. What are they considering right now?
Speaker 5: Yeah, I mean the first thing on the agenda, as
Speaker 5: far as we understand it, is this factory network. You'll
Speaker 5: remember we've done all of these stories and spoken about
Speaker 5: big plants in Ohio, big plant in Magdeburg and Germany.
Speaker 5: Obviously an extension of what they already have in Arizona,
Speaker 5: and smaller projects around the world. That is a lot
Speaker 5: of money being poured into the ground in anticipation of
Speaker 5: business growing significantly. What we learned from earnings was that
Speaker 5: business is not growing to match that footprint, whether it's
Speaker 5: a footprint physically or whether it's a headcount. So clearly
Speaker 5: that focus is on right sizing the company around what
Speaker 5: they've got coming in in terms of orders and money, and.
Speaker 2: In what you do so well in the story. It's
Speaker 2: a context, isn't it that this isn't an overnight issue.
Speaker 2: This has been long time coming.
Speaker 5: Yeah, I know, that's that's absolutely true. I mean, you know,
Speaker 5: the focus that the traditional Wall Street playbook would be
Speaker 5: or look at the management, do we need a new management.
Speaker 5: Do we need to spit all of those kind of
Speaker 5: standard playbook things don't really apply here, at least not yet.
Speaker 5: I mean Pat Gelsinger, remember, was brought in to fix
Speaker 5: the problems that already existed.
Speaker 2: He gave a.
Speaker 5: Prescription that everybody signed off on and agreed with. The
Speaker 5: problem that we have is that that prescription is being
Speaker 5: proving more painful than perhaps we had expected, and clearly
Speaker 5: the market does not like that.
Speaker 2: We're just looking at the revenue growth that the market
Speaker 2: does not like. Inking we so appreciate it, thank you.
Speaker 2: Let's just talk about what the market's also having to
Speaker 2: digest with Microsoft saying it's going to be cutting six
Speaker 2: hundred and fifty jobs in its Xbox unit, the third
Speaker 2: such layoffs this year, as the company is just trying
Speaker 2: to rein in costs and integrate that massive sixty nine
Speaker 2: billion dollar acquisition of Activision Blizzard. The roles to be
Speaker 2: eliminated are, in quote, mostly corporate and supporting functions, according
Speaker 2: to a memo sent staff like Xbox chief Phil Spencer.
Speaker 2: Today and what have we got coming up?
Speaker 3: Yes, some breaking news on the Bloomberg terminal. Apple has
Speaker 3: got FDA authorization for its AirPods to act as hearing
Speaker 3: aids in a hearing aid feature. We were tracking this
Speaker 3: one because they said just on Monday during the presentation
Speaker 3: that they were going to get it, and they did.
Speaker 3: And you look at some of the other hearing aid stocks,
Speaker 3: they're not moving right now. They were when that news
Speaker 3: first came out. Apple flat in what's been an interesting week.
Speaker 3: But we've got a lot coming up on the show too. Yeah,
Speaker 3: we've got to talk about what's happening up in the Skycarrier.
Speaker 3: Historic day for SpaceX and Polarist.
Speaker 6: Dawn.
Speaker 3: I'm very much looking forward to this one. Stick with us.
Speaker 3: This is Bloomberg Technology. Some quick cause. Micron under pressure
Speaker 3: this morning. They start stock touching it's lowest level nearly
Speaker 3: seven months. As some analyst reactions. BNP with a double downgrade,
Speaker 3: cutting shares to underperform from outperform with a street low
Speaker 3: price target. The analyst warning of a correction in DRAM
Speaker 3: prices due to some oversupply risks.
Speaker 2: Carroc now some breaking new some brumbo that General Motors
Speaker 2: is in discussions to buy EV batteries that we use
Speaker 2: technology from China's c at L and be assembled at
Speaker 2: a new plant slated actually to be built here in
Speaker 2: the United States. It's all according to sources. Gabikopole is
Speaker 2: here to break it down, and well, this is a
Speaker 2: political handball.
Speaker 7: It feels like, yes, you know, it is very sensitive.
Speaker 2: You know, we've got US and China.
Speaker 7: The US is trying really hard to decouple from China,
Speaker 7: and Chinese companies are trying really hard to access the
Speaker 7: US market. And the automakers, the American automakers are cart
Speaker 7: in the middle because you know, GM for you know,
Speaker 7: every st they've all poured billions of dollars into making
Speaker 7: batteries and forming joint ventures with their Korean battery makers,
Speaker 7: and you know, I've gotten a lot of subsidies from
Speaker 7: the US government order to do so. But because evs
Speaker 7: are not selling well, because they've had struggles making batteries,
Speaker 7: which is normal, you know, making batteries and evs for
Speaker 7: the first time in your one hundred year history. It's
Speaker 7: not going to go smoothly right off of bat It
Speaker 7: never does. Didn't for Tesla, it doesn't for anybody. So
Speaker 7: they're under pressure. And so this potential deal, which is
Speaker 7: still tentative, you know, it's just talks. Nothing is finalized.
Speaker 7: Would be a way for American car companies to get
Speaker 7: access to cheap, you know, really cutting edge battery technology
Speaker 7: from China without tripping up all the political wires that
Speaker 7: could you know, potentially trip up when you work with
Speaker 7: a Chinese company.
Speaker 3: Right, Well, I think the basics of what we heard
Speaker 3: from sources is really important. The mechanics are such that
Speaker 3: the battery technology is licensed from c ATL, a Chinese company,
Speaker 3: but the operations around by a conglomerate from Japan called TDK,
Speaker 3: which many of the people on this show probably haven't
Speaker 3: heard of, but they're basically a consumer electronics company, and
Speaker 3: then GM and other automakers, I think is what we're hearing,
Speaker 3: right Gabby would buy the batteries on fixed term contracts,
Speaker 3: so they're kind of insulated from price wings take it
Speaker 3: from there.
Speaker 7: What else do we know, Well, I think, you know,
Speaker 7: I think one of the most interesting things about this
Speaker 7: is that you've got a Japanese company acting as a middleman.
Speaker 7: You know, up until now, we've seen Ford and Tesla
Speaker 7: do these kind of cute kind of licensing the hills
Speaker 7: where they can use c ATL technology without you know,
Speaker 7: violating rules or tripping any political wires. Now this is
Speaker 7: a new development and how the auto industry is adapting
Speaker 7: to the political environment and the UV environment and the
Speaker 7: fact that they're.
Speaker 1: You know, not profitable on making VS yet.
Speaker 7: So we know that, yes, we know that GM and
Speaker 7: CTL and Japan's TDK, which makes battery, there's employer for
Speaker 7: the iPhone. They you know, make batteries consumer electronics. They
Speaker 7: want to get into the EV battery business and this
Speaker 7: could be a way into it. So they're looking at
Speaker 7: states in the southern US, you know. And I think
Speaker 7: that you know, obviously this is so sensitive politically that
Speaker 7: I think the results of the presidential election November it
Speaker 7: could potentially, you know, affect the outcome.
Speaker 8: Of these talks.
Speaker 3: That's what sources told us. Bloombergs Gavy Coppl are great reporting,
Speaker 3: really interesting reporting alongside you. Thank you. Okay. It was
Speaker 3: a historic day for SpaceX. The company's polarist, Dawn Crewe,
Speaker 3: successfully completed the first commercial spacewalk. Tech billionaire Jaredisingcman was
Speaker 3: the first of the crew to step foot outside. Here's
Speaker 3: what he experienced.
Speaker 7: Back at home.
Speaker 9: We all have a lot of working here, but from
Speaker 9: here works looked like a perfect.
Speaker 3: World for more ez in a Uzukoro of the Harvard
Speaker 3: Belfa Center joins us. She was formerly Assistant Director for
Speaker 3: Space Policy at the White House, where she led advancements
Speaker 3: in space launch capabilities, as well as a former NASA
Speaker 3: executive with over sixty space mission contributions. And let's start
Speaker 3: with your reaction to what happened in just a few
Speaker 3: hours ago.
Speaker 10: This is a huge success at its monumental not just
Speaker 10: for astronauts, but for anybody with a dream for space
Speaker 10: ACX to test the market viability of space tourism, for
Speaker 10: us to determine if space tourism can really grow quite
Speaker 10: like the early days of aviation. So this is fantastic.
Speaker 3: The images on the screen that you're seeing are from
Speaker 3: Jared Isaigman's helmet camera from the custom spacesuit, and now
Speaker 3: what you're seeing is the nose cone camera from atop
Speaker 3: the Dragon capsule. But this is the question so many
Speaker 3: people asked me this morning. Was it actually a spacewalk?
Speaker 10: Yes, technically it was because they were outside their capsule,
Speaker 10: their spacecraft, and they have a railing that they were
Speaker 10: holding on to and they were outside their capsule for
Speaker 10: ten minutes each, Both tired and Sarah the other astronaut,
Speaker 10: and this is risky. You think of a spacesuit as
Speaker 10: a spacecraft in itself because it monitors their temperature and
Speaker 10: controls their vitals while they are outside. And what we
Speaker 10: see is is how successful this was after a mere
Speaker 10: few years of training versus the decade that one trains
Speaker 10: for when you were a professional astronaut.
Speaker 2: Phenomenal when it comes to commercial space success as an
Speaker 2: a what we love when they come back and they're tested,
Speaker 2: because this is about radiation exposure as well. How tough
Speaker 2: could this have been on their bodies?
Speaker 10: Absolutely tough. You can be hot for one moment, you
Speaker 10: could be cold another moment. Your fingers could hurt.
Speaker 2: So even though it's.
Speaker 10: Cold in space, there could be pressures within the suit
Speaker 10: that make you feel a very warm. So this was
Speaker 10: a complete thorough test of the spacesuit which SpaceX intends
Speaker 10: to use for future Moon missions, for future Mars missions,
Speaker 10: and so there will be a lot of lessons learned
Speaker 10: in those regards. But I think if you think of
Speaker 10: the trillion dollar space economy that has been discussed for
Speaker 10: decades now, this is really an exciting point to see
Speaker 10: if there is viability in that market, to see how
Speaker 10: much growth the sector will endure due to this SASS Today.
Speaker 2: Sarah Gillis was out there as well, and I think
Speaker 2: it was hers saying, this is really integral for data
Speaker 2: to back to SpaceX, but they don't really know yet
Speaker 2: what they'll be doing with it. At the moment, it
Speaker 2: just feels like SpaceX is cleaning up when it comes
Speaker 2: to space success is.
Speaker 10: It and they are doing remarkably well. It's it's obviously
Speaker 10: due to their their vision, their hard work, and this
Speaker 10: success is just so so impressive because space walks are
Speaker 10: risky and you have astronauts that are not professional astronauts,
Speaker 10: and the company has been planning this mission for years
Speaker 10: and not decades and they pulled it off us successfully.
Speaker 10: So it's it's very critical to realize the feed that
Speaker 10: was accomplished today. It's incredibly impressive.
Speaker 2: Thanks for giving the context it deserves as in a Okura,
Speaker 2: Great to have you with us. Harvid Belfer Center senior
Speaker 2: fellow and former NASSER executive. Broadening out to the world
Speaker 2: of tech investing investing more broadly, Betterment, which builds itself
Speaker 2: as the largest independent digital financial advisor, just come out
Speaker 2: with first of it's kind survey showing four in five
Speaker 2: advisors using AI in their work to discuss how artificial
Speaker 2: intelligence is managing your money. Vetterment CEO Sarah Levy is
Speaker 2: here with us. Sarah, what made you run these sorts
Speaker 2: of numbers. I know that you're looking at this particular
Speaker 2: part of the business, you're rebranding it, but you just
Speaker 2: wanted to understand how these advisors are getting to groups
Speaker 2: of AI.
Speaker 11: So the key for us is that the advisor we
Speaker 11: serve tends to be more of a millennial advisor, and
Speaker 11: this is a growing group and they're much more technically
Speaker 11: sophisticated than their predecessors, and so they don't sort of
Speaker 11: suffer fools lightly when you think about the technology choices,
Speaker 11: the user interface, the power, we really they need to
Speaker 11: provide them with powerful tools and so Betterment Advisor Solutions
Speaker 11: is our advisor arm and our roots were originally with
Speaker 11: the retail investor, where we learned a lot, But what
Speaker 11: we've learned for advisors is they can harness the power
Speaker 11: of technology just so much more, and AI for.
Speaker 8: Me is really a continuation on that spectrum.
Speaker 3: Right.
Speaker 11: We introduced automation to save time, to save money, to
Speaker 11: help with customer retention, and AI just furthers that journey.
Speaker 2: Really, what are they using are they're using generative AIPSA,
Speaker 2: and how are they saving themselves time? How they're more productive?
Speaker 8: So I think of AI a lot like digital.
Speaker 11: If you think back to call it two decades ago,
Speaker 11: when we talked about digital and you said, you have
Speaker 11: digital companies and you have analog companies, right, And at
Speaker 11: the time people would ask, you know, are you going
Speaker 11: to work in digital?
Speaker 8: And then digital became sort of part of the fabric
Speaker 8: of everything we do.
Speaker 11: That's how we think about AI, which is it's really
Speaker 11: just powering the humans to do better, stronger, faster. Right,
Speaker 11: So everything from pair of planning right before you meet
Speaker 11: with a client as advisor, and then after you meet
Speaker 11: with that client, there's a lot of work to do.
Speaker 11: AI can just take a lot of that administrative burden
Speaker 11: off the plate.
Speaker 8: That's just one great example, Sarah.
Speaker 3: The better question posed by the Better Men survey is
Speaker 3: whether those four out of five financial advisors who are
Speaker 3: using AI, because loads of people watching this program will
Speaker 3: have a financial advisor, whether AI actually makes them better
Speaker 3: in managing people's money. Is there any evidence of that?
Speaker 11: Well, I think I wouldn't think about AI as actually
Speaker 11: managing people's money. Remember, as a financial planner, we are fiduciary.
Speaker 11: Our advisors are fiduciaries. We as an RIA or fiduciaries.
Speaker 11: So I think the way you want to think about
Speaker 11: AI is basically giving back time and saving money for
Speaker 11: the advisor so that the advisor can focus on the
Speaker 11: client and on the investment solutions. And that's really the
Speaker 11: benefit that they're getting AI. The computers are not taking
Speaker 11: over the world, right, The human advice is still a
Speaker 11: critical component of getting people to great outcomes and great plans.
Speaker 3: An extension of that is whether it then becomes the
Speaker 3: economics kind of change, right, and fees and the incentive
Speaker 3: of somebody using a service or a digital format such
Speaker 3: as yours.
Speaker 2: Well.
Speaker 11: I think look in the early days of where we began,
Speaker 11: our roots were robo advisory, right, and there was a
Speaker 11: lot of sort of dismay in the advisor community, Right,
Speaker 11: is technology going to take over the human interaction? And
Speaker 11: I just think that was very overblown And I would
Speaker 11: say the same about AI, which is not to diminish
Speaker 11: its potential. I think it is going to be a
Speaker 11: huge sort of power tool enhancer.
Speaker 2: If you will.
Speaker 11: But we've been building power tools for both advisors and
Speaker 11: retail investors for the better part of a decade and
Speaker 11: a half, and this just takes that really to the
Speaker 11: next level. That's the way we're thinking about it.
Speaker 3: Okay, so cools Classic sixty forty portfolio. It's just that
Speaker 3: the financial advisor will have more time being freed up
Speaker 3: by AI Betterment CEO Sarah Levy really appreciate you being
Speaker 3: here on Bloomberg Technology.
Speaker 2: Welcome back to Bloomberg Technology. I'm Caroline Hyed.
Speaker 3: In New York and I met love Low in San Francisco.
Speaker 2: Make check on these market said, because actually we have
Speaker 2: SAD now four straight days and gains on the NASAC
Speaker 2: and NASDAQ one hundred.
Speaker 1: We're on a roll.
Speaker 2: We've actually added a trillion dollars in terms of market
Speaker 2: capitalization over those four days. Despite those headwinds of perhaps
Speaker 2: that CPI coming in a little hot on the core
Speaker 2: basis two year yields actually just pushing up a little bit.
Speaker 2: So maybe we're still anticipating what the Fed will do.
Speaker 2: Will they be able to cut as much has been anticipated?
Speaker 2: Many now seeing just twenty five basis point cup coming
Speaker 2: for September I'm looking at Bitcoin just have a quarter
Speaker 2: of percent, so a little bit of risk on there
Speaker 2: as well. Move on and have a look at the
Speaker 2: individual movers. Look a lot of the push forward in
Speaker 2: the Nasdaq is thanks to Nvidia and some of the
Speaker 2: chip names. I think Broadcom is one of the biggest
Speaker 2: names for points contributing today. Warner Brothers Discovery doing well
Speaker 2: up almost two percent. Child Communications, yes, they will still
Speaker 2: have that distribution deal. Both arising. We're looking at MasterCard
Speaker 2: off by six tens percent, but big deal. More than
Speaker 2: two billion dollars being spent in cybersecurity for this particular company,
Speaker 2: So they're doing a deal. They're focusing on your data.
Speaker 2: But of course when they splash the cash, maybe the
Speaker 2: chairs come under pressure a little bit. Maderna though your
Speaker 2: key underperformer. I'm talking tech pot biotech here, and really
Speaker 2: a lack of clarity coming in future revenue from this
Speaker 2: business that doesn't seem to be amazing analysts. They feel
Speaker 2: that there's a lack of clarity in general on this business.
Speaker 2: But we are seeing revenue and the revenue guide being
Speaker 2: pulled down.
Speaker 3: And what do you got an opportunity to get clarity
Speaker 3: on another business as the Goldman Sachs Tech Conference comes
Speaker 3: to a close in San Francisco. We're thinking about how
Speaker 3: fintech is revolutionizing the financial sector. But we're also joined
Speaker 3: by one of the main players in global e commerce,
Speaker 3: Macado Libre. It's CFO Martin de Los Angeles joins us. Now,
Speaker 3: welcome to Bloomberg in San Francisco. I think about your
Speaker 3: business in this way that e commerce, but fifty percent
Speaker 3: of it is now essentially fintech. You've met with the
Speaker 3: anchors and your investors and the other members of the
Speaker 3: technology community in the last few days. What business outlook
Speaker 3: and update did you give them? Thank you ed for
Speaker 3: having me. It's a pleasure of being here.
Speaker 12: We are celebrating the twenty fifth anniversary of our company
Speaker 12: this quarter, and over the past twenty five years, we
Speaker 12: have built the largest e commerce platform and fintech platform
Speaker 12: in Latin America.
Speaker 3: We recently became the largest the.
Speaker 12: Most valuable company in that of market CUP in Latin
Speaker 12: So we're very excited about the growth and the opportunities
Speaker 12: that we.
Speaker 3: Are facing on.
Speaker 12: The change that we're making in our society is on
Speaker 12: the commerce side of the business. We hope with last
Speaker 12: year we had more than ninety million buyers purchasing one
Speaker 12: point five billion products in our platform for more than
Speaker 12: fifty billion dollars and growing very rapidly. This is one
Speaker 12: of the things that the investor community was very surprised
Speaker 12: of our QUE two results. We build a very large
Speaker 12: logistic infrastructure that enabled us to deliver seventy five percent
Speaker 12: of the products within four day, within two days in
Speaker 12: Latin America.
Speaker 3: That would be something and dream of in Latin America
Speaker 3: ten years ago before.
Speaker 12: We build a logistic infrastructure on the fintech side of
Speaker 12: the business with process payments for over one hundred and
Speaker 12: seventy billion dollars, serving fifty two million active users in
Speaker 12: our fintech solution Mercallo Power platform, and we're serving mostly
Speaker 12: people who had been excluded from the financial system, you know,
Speaker 12: individuals or SMBs who had never had access to credit
Speaker 12: or financial products. So we're doing a lot of financial
Speaker 12: inclusion in Latin America. So I'm very excited about the
Speaker 12: past twenty five years, but we have plenty of row
Speaker 12: opportunities going forward for the next twenty five years.
Speaker 1: Martin.
Speaker 2: We're looking at your shares at a record high. What
Speaker 2: about competition. You've seen the fintech the unbanked opportunity, but
Speaker 2: so have a lot of others. How you as you
Speaker 2: search for a go for a banking license, thinking about
Speaker 2: others wanting in on the space.
Speaker 12: Yes, Carol, and we see a tremendous opportunity on fintech
Speaker 12: in particular because of the banks have done a really
Speaker 12: poor job in Latin America, including people in the system.
Speaker 3: If you look at.
Speaker 12: Mexico, for instance, where we're very active. We are the
Speaker 12: largest fintech in Mexico in terms of a number of
Speaker 12: users and a credit book. For instance, this is a
Speaker 12: country where fifty percent of the people don't have doesn't
Speaker 12: have a banking account, less than twenty percent of people
Speaker 12: have a credit count.
Speaker 1: So there's plenty of room for us to grow.
Speaker 3: And of course in Mexico, it's not just the bank account.
Speaker 3: I'm thinking about deposits and loans, other financial products. Are
Speaker 3: you having success in Mexico exactly.
Speaker 12: Our credit book is rowing fifty one percent year on year.
Speaker 12: We have a one point five billion dollar book in Mexico,
Speaker 12: which is the largest for any fintech in the country.
Speaker 12: Our users on the fintech side of the business are
Speaker 12: rowing at thirty seven percent year on year from a
Speaker 12: very large base. So Mexico is wide open really, so
Speaker 12: there are players who are also going to that market,
Speaker 12: and we think there would be a lot of financial inclusion.
Speaker 1: That would be space for several other players.
Speaker 12: Nike commerce where winner takes most in fintech, there is
Speaker 12: room for several players to be very innovative, to actually create,
Speaker 12: you know, change the lots of people, you know, by
Speaker 12: including them financially.
Speaker 2: Let's go back to the winner takes most in a commerce.
Speaker 2: You've got some Chinese competition. In fact, Mark Cello Clare
Speaker 2: himself is helping chin for example. How are you seeing
Speaker 2: the Chinese competition in in commerce?
Speaker 12: Yeah, we've seen the know, we operated for twenty five
Speaker 12: years in the region with a lot of competition. Initially
Speaker 12: the world platform similar to Marcal.
Speaker 1: Oliria that we competed with.
Speaker 12: Then we be obviously with all the local retailers. More
Speaker 12: recently with you know the Americans Amazon and Walmart, and
Speaker 12: more recently we have seen a lot.
Speaker 3: Of competitions from the Chinese. So the way we face competition.
Speaker 12: Is we base that we compete basing basing on our strength,
Speaker 12: which is the logistic infrastructure, that we have in Latin
Speaker 12: America that enables us to provide a world class service
Speaker 12: to our users. And then the fintech and the payments,
Speaker 12: the solutions that we have built in a region where
Speaker 12: most people don't have a credit card, having our own
Speaker 12: payment solutions is a really big competitive advantage. In case
Speaker 12: of Mexico, twenty five percent of the payments that are
Speaker 12: done on our platform are done with our own payment
Speaker 12: methods to our own credits, our credit cards and so on.
Speaker 3: But I think before we run out of time, we
Speaker 3: should talk about Argentina. A lot of people are trying
Speaker 3: to make a conclusion of the economic policy of MELA.
Speaker 3: How do you view that market? What are you going
Speaker 3: to do in Argentina.
Speaker 12: Yeah, Argentina is a market glob We have a very
Speaker 12: solid position. We actually started the company back back in
Speaker 12: the days in Argentina. We had a tough first quarter,
Speaker 12: but we're regain growth in the second quarter, so we
Speaker 12: see a lot of opportunities there. We're investing in Argentina.
Speaker 12: We opened our new full fillment center there. After five years,
Speaker 12: we're reinvested in Argentina and we see a lot of
Speaker 12: good prospects for the country.
Speaker 3: So the good thing about our business is that we've
Speaker 3: seen it.
Speaker 12: All in Latin America over the past twenty five years,
Speaker 12: and the secular trend of people moving online. You know,
Speaker 12: fifteen percent of the retail is done online in Latin
Speaker 12: America compared to twenty high twenties in the US high
Speaker 12: thirties in China. So it's plenty of room to continue
Speaker 12: growing the e commerce market, and we are the leading
Speaker 12: player in e commerce, so we have we play a
Speaker 12: very important role in that transition. And the fintex side,
Speaker 12: there's plenty of continue growing. So as we say in bergalalibree,
Speaker 12: the best is yet to come.
Speaker 1: We have a very good prospect for the future.
Speaker 3: Beclor libre ce Fo Martin de la Santos, Thank you
Speaker 3: so much, Caroline.
Speaker 2: Let's get to some talking tech now. First up, China
Speaker 2: wants to keep its EV tech to itself. According to sources,
Speaker 2: Beijing has asked carmakers to keep its EV export kits
Speaker 2: from foreign plants, meaning key parts of the vehicle would
Speaker 2: need to be produced domestically now and the move comes
Speaker 2: as more companies build out factories in other territories. Plus
Speaker 2: two of China's most prominent AI chip designers are looking
Speaker 2: to an IPO, calling into sources. Shanghai end Flame and
Speaker 2: rival Shanghai Barn are planning and IPO as soon as
Speaker 2: this year. The move comes as China looks to sure
Speaker 2: up at semiconductor industry to combat US led sanctions and vans.
Speaker 3: Ed a little bit more to come in the show.
Speaker 3: We're going to be joined by Anderill founder Palmer Lucky
Speaker 3: for an exclusive interview on the company's latest set of
Speaker 3: autonomous defense vehicles and CARO. We actually have even more
Speaker 3: breaking news coming up as well.
Speaker 2: We do a new COO over at Microsoft, Slatya Nadella
Speaker 2: saying this is building on capabilities essential in AI and
Speaker 2: operational at Excellence. Carolina Dibeck Habit is joining Microsoft as
Speaker 2: EVP and COO. It's a newly created role, which can
Speaker 2: we be joining the senior leadership team reporting to Satya.
Speaker 2: Still not moving the share price. This is Bluemberg Technology.
Speaker 3: Fuse Energy is raised thirty two million dollars in a
Speaker 3: new funding round, valuing the nuclear fusion testing startup above
Speaker 3: two hundred million dollars. Right now, Industry experts say producing
Speaker 3: commercially viable fusion will require another decade or two of work,
Speaker 3: giving Fuse plenty of runway for customers to test their
Speaker 3: new technology. Bloom Box Lazette Chapman has the story, You
Speaker 3: and I know loads of people in the valley who
Speaker 3: have been talking about fusion for a while, and this
Speaker 3: is like a sort of tangible startup and part of
Speaker 3: the process. But my goodness, it sounds like we're still
Speaker 3: a long way off it being mainstream.
Speaker 13: The technology will take a decade or two at least
Speaker 13: to create commercially viable source of energy. Like you said,
Speaker 13: this company is looking to make money along the way
Speaker 13: by providing radiation as a service to not only the
Speaker 13: private startups that are looking to do this. As we've discussed,
Speaker 13: there's a lot of money and a lot of interests
Speaker 13: being commercializing this, but more importantly to provide revenue and
Speaker 13: testing results immediately by providing radiation as a service to
Speaker 13: harden nuclear weapons testing and then also use that data
Speaker 13: to build their own fusion generator.
Speaker 2: Pulsed power machines is what they're building. Who wants to
Speaker 2: take the financial risk to back this, Who is interested
Speaker 2: in full string? Who is in the round?
Speaker 13: Right, So there are a number of investors. There's Buckley
Speaker 13: Ventures Josh Buckley, there's Tamarek as well as the Chainsmokers,
Speaker 13: the musical group, their their venture capital firm, along with
Speaker 13: former d D and.
Speaker 2: Officials and also.
Speaker 13: Someone from Lucky Martin, the former chief executive of Asia.
Speaker 13: So they'll be looking to use this technology in incremental ways,
Speaker 13: looking to rent their machines, UH to just blast different
Speaker 13: mis machines like cider pilots, etc. To see what the
Speaker 13: effects of a nuclear explosion would be on planes and
Speaker 13: other materials that.
Speaker 2: US would need. And time of war is that Chapman,
Speaker 2: we appreciate it. And talking of time of war, Andreil
Speaker 2: has just unveiled the Barracuda family of autonomous air vehicles,
Speaker 2: revealing its offering of a course to the Defense Department
Speaker 2: program aimed at mass producing aerial vehicles were cheaply, Andreill
Speaker 2: founder Harma Lucky joins us now and the philosophy here,
Speaker 2: Parma is just making it ever more easy, fewer parts
Speaker 2: and making it quicker to make.
Speaker 13: Well.
Speaker 6: You know, I think that having fewer parts easier to
Speaker 6: make that's downstream of the real goal, which is to
Speaker 6: make sure that the United States are allies and our
Speaker 6: partners around the world have the tools that we need
Speaker 6: to deter expansionist dictatorships like China. Right now in a
Speaker 6: lot of war games we are modeling, the United States
Speaker 6: is running out of critical munitions, particularly missiles, in just
Speaker 6: a few days of conflict. And all for years has
Speaker 6: been working to build a family of systems that solves this.
Speaker 6: And we just announced that family of systems today. It's
Speaker 6: called Barracuda. It's made with half the parts, in half
Speaker 6: the time, using ninety five percent less tools than a
Speaker 6: lot of the existing missile systems.
Speaker 1: On the market.
Speaker 6: It is a mass manufacturer product that is designed to
Speaker 6: be made at scale, many thousands of systems at a time.
Speaker 6: Because that's what the United States need, that's what our
Speaker 6: allies need, It's what our partners need.
Speaker 2: Talking of partners and allies, drone AI over in Ukraine
Speaker 2: at the moment, your supplying drones, we understand piloted by AI.
Speaker 2: But how much is it AI? How much is it
Speaker 2: the human? How much autonomy do they have about targets?
Speaker 6: Well, in our case, it's all about AI. Our core
Speaker 6: product is called Lattice. Interol Industries has been working on
Speaker 6: AI powered weapons for about seven years now, and the
Speaker 6: core software is Lattice, this brain that powers all of
Speaker 6: our different systems, including Barracuda, including alts, including Ghost which.
Speaker 1: Are in Ukraine and have been since this a week
Speaker 1: of the war.
Speaker 6: We've destroyed hundreds of millions of dollars in critical Russian
Speaker 6: hardware that can't really be destroyed by things that require
Speaker 6: a real time link to a person, because the Russians
Speaker 6: are quite good at jamming communications links when it comes
Speaker 6: to things that are important to them.
Speaker 1: They don't have enough of these jammers to hit the
Speaker 1: entire battlefield.
Speaker 6: But that's why it's so important that we keep taking
Speaker 6: those things out and eventually hopefully leave them help us
Speaker 6: to these types of systems.
Speaker 3: Palmerate, it's great to have you back on Bloomberg technology.
Speaker 3: You know, in the context of Ukraine, I'm kind of
Speaker 3: thinking about the existing work and then you know what
Speaker 3: we're hearing from Ukraine at the moment, which is they
Speaker 3: kind of want to push deeper or strike deeper into Russia.
Speaker 3: Does Andrew have any technology where you would work with
Speaker 3: Ukraine on that goal or be a part of that process.
Speaker 6: Absolutely, with the caveat that these decisions are not up
Speaker 6: to us, It's up to the United States.
Speaker 1: Government.
Speaker 6: They decide understand who we sell to, how we sell
Speaker 6: to them, and to a large extent, what they do
Speaker 6: with these weapons systems. And I don't think that AROL
Speaker 6: or any private defense company, any private company period should
Speaker 6: be in a position where we're de facto controlling the
Speaker 6: United States foreign policy position by saying, oh, we would
Speaker 6: help with this, we would help with that. I think
Speaker 6: that we need to put that decision with the people
Speaker 6: who are supposed to be making that decision, which are
Speaker 6: people who are accountable to the electorate. In other words,
Speaker 6: you should not trust me, You should not have to
Speaker 6: trust me. You should trust somebody that you can vote
Speaker 6: for and then vote accordingly.
Speaker 3: We're showing images of the barracuted system. And at the
Speaker 3: top of the program you talked about allies, and so
Speaker 3: when I think about scalability, is that because you want
Speaker 3: to be in service of any specific allies beyond the
Speaker 3: US government. What is the sort of benefit of the
Speaker 3: scalability of the design.
Speaker 6: Well, this gets into a little bit of the philosophy
Speaker 6: of it. But I'll tell you how I think about things.
Speaker 6: I don't think the United States needs to be the
Speaker 6: world police. I think we need to be the World
Speaker 6: gun Store. We need to be able to provide our
Speaker 6: allies and our partners around the world with the tools
Speaker 6: that they need to turn themselves into prickly porcupines that
Speaker 6: nobody wants to step on. And I think that sending
Speaker 6: American lives overseas boots on the ground is not going
Speaker 6: to be the future of how we support support our
Speaker 6: friends around the world. I think it's going to be
Speaker 6: making sure that we can make things at a scale
Speaker 6: where they believe that our support for them is more
Speaker 6: than just words. We can actually send them the things
Speaker 6: that we say that we're willing to send them. I
Speaker 6: think Ukraine has really exposed this weakness in the United
Speaker 6: States foreign policy strategy where we say we support all
Speaker 6: of these people, but they look to say, well, they
Speaker 6: can't even manufacture the basics like artillery shells or small missiles.
Speaker 6: How could I possibly count on these people to be
Speaker 6: able to cash these checks if they're writing And I
Speaker 6: think that Barracuda is a response to that.
Speaker 1: Largely.
Speaker 6: It's something that was designed from the beginning for low cost,
Speaker 6: high rate manufacturability, and it's a flying operational system right
Speaker 6: now with multiple customers. I think that partners are going
Speaker 6: to be able to trust that Barracuda is something that
Speaker 6: we could actually make for them and deliver to them
Speaker 6: when they need it, not just now, but also if
Speaker 6: a conflict to erupt and.
Speaker 2: You're delivering by manufacturing ever more in the United States
Speaker 2: and with money doing cash and checks. You've just recently
Speaker 2: got a whopping valuation of fourteen billion dollars by raising
Speaker 2: more money to build in the US as the Arsenal
Speaker 2: one and other manufacturing units. Can you update us as
Speaker 2: to where they might be the sprawling manufacturing areas.
Speaker 1: We just closed a huge round with our investors.
Speaker 6: It was all of our previous investors coming in and
Speaker 6: a whole bunch of new strategic investors who want to
Speaker 6: help us build a lot of things, but particularly Arsenal one,
Speaker 6: which is a five million square foot factory that we're
Speaker 6: building that is going to create thousands of jobs and
Speaker 6: build vast numbers of AI powered autonomous weapons systems. And
Speaker 6: it's not just Barracuda, it's actually the entire product suite
Speaker 6: of things that ANDROL makes. It's all of our missiles,
Speaker 6: it's all of our drones, it's our submarines, it's a
Speaker 6: reconfigurable factory line that is able to share a lot
Speaker 6: of the equipment and tooling between these programs, which gets
Speaker 6: the costs down and it gets the rates up and
Speaker 6: the benefits flow on.
Speaker 1: To our customers.
Speaker 3: Palma is Anderil's selling air defense systems to Israel.
Speaker 6: Well, look, I think I can't comment on any specific
Speaker 6: deployments about especially about something is sensitive to that, but
Speaker 6: I'll tell you this, I have no problem with Israel.
Speaker 6: I have no problem selling things like that to Israel.
Speaker 6: But a better target for your.
Speaker 1: Question would be the United States government.
Speaker 3: And I have to ask you. You mentioned China at
Speaker 3: the top of the conversation. Has Anderil a commercial relationship
Speaker 3: with Taiwan.
Speaker 6: Oh, we have a very strong relationship with Taiwan. I've
Speaker 6: I've been there many times. In fact, I'm going there
Speaker 6: again soon. And I think that you know that strong
Speaker 6: relationship is actually one of the reasons that ANDROL was
Speaker 6: recently sanctioned by the Chinese Communist Party. They announced that
Speaker 6: we are that they're going to seize all our Chinese
Speaker 6: assets and that we're prohibited from entering the country.
Speaker 1: Jokes on them. We don't have any Chinese assets.
Speaker 6: But it was in the wake of a recent deal
Speaker 6: that we did with Taiwan, getting them some systems that
Speaker 6: I think China, frankly, is really afraid of. They know
Speaker 6: that our systems are the real deal, and they know
Speaker 6: they can't jam them, they know they can't hack them,
Speaker 6: and that's because they're powered by AI.
Speaker 3: Ander or founder parme Lucky. It's been a while. It's
Speaker 3: great to have you back here on Bloomberg Technology. Thank
Speaker 3: you very much.
Speaker 2: Sixty seven million viewers tuned into the presidential debate between
Speaker 2: Vice President Kamala Harris and former President Donald Trump. And
Speaker 2: that's only on TV. It's, acording to Nielsen data, blow
Speaker 2: well past the fifty one million who watched the Republican
Speaker 2: nominee take on President Joe Biden. Back in June. Trump
Speaker 2: said he is not inclined to have another debate with Harris,
Speaker 2: though he later added he hadn't completely ruled out another matchup.
Speaker 2: I streamed it ed, So going to know is what
Speaker 2: the numbers we really were?
Speaker 3: Yeah, believe it or not. Earning season is continuing. The
Speaker 3: next wave of generator of AI services may depend whether
Speaker 3: tech companies can find enough detail. Three D renderings of
Speaker 3: tractor trailers and shampoo bottles Adobe and Video Audodesk and
Speaker 3: said that other startups are working on just that. This
Speaker 3: is something Bloomberg's Brady Ford reported, and he did it
Speaker 3: before Adobe's innings after the bell tonight. Let's start with
Speaker 3: the report. I saw the image attached to the story,
Speaker 3: what are you going on about?
Speaker 14: You know, Look, you could go on the internet if
Speaker 14: you're so inclined and scrape a bunch of photos, a
Speaker 14: bunch of videos, a bunch of books. If you want
Speaker 14: to create a three D model that can generate a
Speaker 14: coffee cup or something like that, you need something that
Speaker 14: is not You can't scrape it, right. And so we're
Speaker 14: seeing companies like Adobe going out and note that they're
Speaker 14: not scraping otherwise, but we're seeing them go out and
Speaker 14: buy three D data directly from creators. We're seeing Autodesk
Speaker 14: go to its companies for construction management and design saying, hey,
Speaker 14: you have these three D renderings of bridges, what if
Speaker 14: you share them with us so we can build this
Speaker 14: three D model. I think the same way we've seeing
Speaker 14: photo models get created.
Speaker 9: A year or two down the line, we're gonna start
Speaker 9: seeing these three D models come out more.
Speaker 2: How much is Adobe able to monetize this new AI focus.
Speaker 1: Well, that's a big question for tonight.
Speaker 9: Right, everybody wants to know whether Adobe is going to
Speaker 9: be able to really get money from all of their
Speaker 9: generative AI innovations.
Speaker 6: Right.
Speaker 9: They've rolled out a lot throughout their products through higher
Speaker 9: pricing tiers, some credit packs, but like many software companies,
Speaker 9: it is not totally clear whether they are actually making
Speaker 9: money from it yet.
Speaker 2: We'll wait to see if that revenue can indeed hit
Speaker 2: the ten percent increased level I expected. Brodie Ford, we
Speaker 2: hope you'll join us tomorrow to break down those numbers.
Speaker 2: We appreciate rank you. Meanwhile, that does it for this
Speaker 2: edition of Bloomberg Technology, conning on what.
Speaker 3: An addition it was, from private companies to public companies,
Speaker 3: everything in between. Don't you've recap on the podcast. You
Speaker 3: know where to find it on the terminal, online, on Apple, Spotify,
Speaker 3: and of course on iHeart from New York City with
Speaker 3: Caroline out here in San Francisco with me and a
Speaker 3: visiting Brodie Ford. This is Bloomberg Technology