Speaker 1: I'm Caroline Hyder Bloomberg's world. I got us in New
Speaker 1: York and I med Ludlow in San Francisco. This is
Speaker 1: Bloomberg Technology. Artificial intelligence still driving markets, carro over earnings
Speaker 1: front and center. Yeah, let's get straight to it. As
Speaker 1: the plunge is clear, with Lift after hours, the ride
Speaker 1: sharing company falling after evidence it's losing share to Uber,
Speaker 1: a weak profit in sales, outlook and social media in
Speaker 1: the spotlight on Capitol Hill, but former Twitter executives are
Speaker 1: telling lawmakers to hold off on regulating online content. Will
Speaker 1: bring you the y plus the latest details on Disney
Speaker 1: as activist investor Nelson Peltz stands down on his proxy fight.
Speaker 1: But is the battle over all that so much more
Speaker 1: coming up? We dig in first and foremost to those
Speaker 1: markets that once again swoon the first two day lows
Speaker 1: we've seen since December, the worst two days, sal off
Speaker 1: about two points of the course of two days, and
Speaker 1: then AzaC of by another percentage point on the day.
Speaker 1: We're worried as again on the macro, on the federal reserve,
Speaker 1: on interest rates going higher. That's why we see well
Speaker 1: overall concerned anxiety as evidence in the vix. The volatility
Speaker 1: index picks up to a twenty handle. The ten year
Speaker 1: yields of boring costs they rise. No wander stocks full.
Speaker 1: Let's switch it on because I want to show also
Speaker 1: this worry about the canary in the cold mine. That
Speaker 1: is well, the retail investor, they're getting bullish, the first
Speaker 1: time we've seen that since April. Many say, oh, we're
Speaker 1: now late to the party. Had Yeah, it's interesting. So
Speaker 1: many stories for individual stocks as well. Alphabet down another
Speaker 1: four point four percent this Thursday or two day drop,
Speaker 1: the biggest two day drops since March, as we continue
Speaker 1: to have worries about their barred AI search. Disney is
Speaker 1: so interesting. We're gonna get into it later in the show.
Speaker 1: But it was up significantly, ending up lower one point
Speaker 1: three percent. We'll get into Tiger's success story so far
Speaker 1: at the entertainment company. Global Foundries is an't to deal
Speaker 1: with GM to supply semi conductors your Homemaker, boosting that
Speaker 1: stock up three and a half percent, and continued momentum
Speaker 1: in Tesla. But right now it is all about earnings.
Speaker 1: Let's get straight to PayPal actually giving a pretty tepid
Speaker 1: forecast in terms of dollar value of bookings or transactions
Speaker 1: through their platform. But crucially CEO Dan Shaman, he is
Speaker 1: going to step down and retire at year end. That
Speaker 1: as we see sales growth slowing and Lift, oh my
Speaker 1: goodness down after hours. Really, what the market seeson on
Speaker 1: is the fiscal first quarter forecast for ebit dar adjusted
Speaker 1: basis five million to fifteen million. The street was looking
Speaker 1: for a forecast of around eighty four million. So that
Speaker 1: is a significant miss on expectations. Let's get more and
Speaker 1: bringing row Hit called Carnie, an analyst at rough m
Speaker 1: K M row Hit, you have a whole rating on
Speaker 1: Lift twenty dollar price target. What's your reaction to the numbers? Um?
Speaker 1: This is this feels like a big recent quarter, one
Speaker 1: more recent quarter from coming from left. There is more
Speaker 1: evidence that they're probably losing market share to uber Um.
Speaker 1: They're landing on the recovery from West coast exposure, and
Speaker 1: on top of it, there are kind of execution issues
Speaker 1: that they have their own insidence kind of way of
Speaker 1: doing things, which which is probably placerbating how things are
Speaker 1: being reported. Here. Hey, right here, Dara Kostrasha, here the
Speaker 1: uber sere It's hold Bloomberg twenty four hours ago that
Speaker 1: he thinks Uber is taking market share from Left. Do
Speaker 1: you see the numbers as evidence of that? Absolutely over
Speaker 1: the last three quarters when we look at the mobility trends,
Speaker 1: but Uber is showing on a sequential growth, although the
Speaker 1: disclosures across both companies are highly inconsistent. So it's not
Speaker 1: apples to apples, it's probably apples to pineapples. But having
Speaker 1: said that, I think just the growth rate that these
Speaker 1: companies are putting up are diverging in a way that
Speaker 1: they weren't a while back. So I feel Uber is
Speaker 1: definitely gaining market share and probably that share gain is
Speaker 1: accelerating as we speak. So what do you want to
Speaker 1: hear from Left leadership right now? As it I think
Speaker 1: the most important thing here is what is the path
Speaker 1: to sustainable cash flow generation UM? The company did put
Speaker 1: out UM target with regards to how high of a
Speaker 1: cash flow generation that they can have. I feel given
Speaker 1: the given the guidance that they have of software revenues
Speaker 1: and much software bit da, I feel they just need
Speaker 1: to provide some confidence to the investors that look, this
Speaker 1: is what these are the steps we can take to
Speaker 1: get to a point that we can generate incremental cash
Speaker 1: and then we can be UM investing in investing for growth.
Speaker 1: I feel that confidence is completely lost after looking at
Speaker 1: their numbers today. There is definitely some noise and confusion,
Speaker 1: But I feel that's what we need to hear when
Speaker 1: that confidence is lost. Do you have to change the ratings?
Speaker 1: You have to change the whole positions. You have to
Speaker 1: change the price target that is now well off that
Speaker 1: twenty large you currently have at the momentum. Again, what
Speaker 1: I would say is everybody on the street will revisit
Speaker 1: their financial models after earnings, so we are in the
Speaker 1: process of doing that. And ANU here from more from us.
Speaker 1: Right here, we asked our audience on Twitter, does Lift
Speaker 1: need to go outside of his existing lane move into
Speaker 1: other areas to stay relevant? These are the conclusions of
Speaker 1: respondents saying, no, stay in your lane. I ask you
Speaker 1: the same question to Lift need to move into delivery
Speaker 1: UM That is going to be a very very expensive
Speaker 1: value proposition right now. I think staying in their own lane,
Speaker 1: UM focusing on mobility and focusing on profitability. I think
Speaker 1: that's that's what is UH something that they need to
Speaker 1: focus on even more. UM that's expanding into lateral markets
Speaker 1: is just going to be more expensive. That is just
Speaker 1: going to push the cash flow generation point much more
Speaker 1: further down the road, and that's going to be hurtful
Speaker 1: to the stock even more. Right here, industry colleagues Tom
Speaker 1: Why at d A. Davidson told us twenty four hours
Speaker 1: ago that the advantage Lift has is its brand. It's
Speaker 1: it's resonance with gen Z. Can it leverage that to
Speaker 1: fight back against you that So far we are finding
Speaker 1: very limited evidence of the fact that they are able
Speaker 1: to leverage that brand. Yes, there is definitely a certain
Speaker 1: cohort of the population that prefers left over Uber, but
Speaker 1: I think at the end of the day, right sharing
Speaker 1: has has very limited amount of loyalty. To some extent,
Speaker 1: both companies are trying to build loyalty around their subscription plans.
Speaker 1: But this is a very very price sensitive product. So
Speaker 1: I feel, regardless of affinity with a certain cohort off consumers,
Speaker 1: that affinity may not linger if the company has to
Speaker 1: change their value proposition increased prices. And at the same time,
Speaker 1: Uber is improved in the marketplace at a much more
Speaker 1: rapid clip, so they have market care to hold onto. Yeah,
Speaker 1: I mean many, I mean include myself. I love using
Speaker 1: the lift bikes, but they need some investment here in
Speaker 1: New York. There's been a lot of handwringing about it.
Speaker 1: I'm interested. Therefore, as we point ourselves forwards, do you
Speaker 1: feel frustrated with management that they didn't guide you to
Speaker 1: this sort of a slow down earlier? When you see
Speaker 1: such a share price hit UM, it's it's hard to
Speaker 1: hard to have that level of visibility nowadays. Again, there
Speaker 1: are a lot of macro factors. There are micro factors
Speaker 1: industry trends that make it even harder for management teams
Speaker 1: to UM to have that level of visibility under normal circumstances.
Speaker 1: This there is there is nothing called as normal from
Speaker 1: a UM from a visibility standpoint nowadays, there are kind
Speaker 1: of driver trends, there is gas prices that are reopening,
Speaker 1: travel trends. Just the externalities just complicate their lives. But
Speaker 1: having said that, a little bit of consistency of our
Speaker 1: predictability in UM in fundamentals is something that any investors appreciates.
Speaker 1: It may be lawer, but still that's consistency is what
Speaker 1: we're looking for. Well, we love your consistency on the
Speaker 1: show and coming on giving your viewpoint ahead of reworking
Speaker 1: some of those models will let you get back to it.
Speaker 1: Our head kill Kany, We thank him a roth M
Speaker 1: k M. China's spy balloons onboard or antennae and solar panels,
Speaker 1: so the US says it could collect US electronic communications.
Speaker 1: In short, this is no ordinary weather research balloon, as
Speaker 1: China is trying to claim. Overall. The US also thinks
Speaker 1: it's managed to identify which company makes these spy balloons
Speaker 1: and says they have direct relationships with the Chinese military.
Speaker 1: The Binn administration could therefore be forced to take yet
Speaker 1: further harsher steps of US technology export to China. They
Speaker 1: don't want the sort of thing getting in the hands
Speaker 1: of the Chinese military and security agencies to be used
Speaker 1: against them. And in fact, the whole saga has completely
Speaker 1: consumed Washington and indeed the rest of the United States.
Speaker 1: We've just seen a resolution passed by Congress condemning the
Speaker 1: actions of China and saying that it was in brazen
Speaker 1: violation of the US sovereignty. They want more information from
Speaker 1: the White House and if really tensions weren't enough between
Speaker 1: China and the US already, particularly from a business perspective,
Speaker 1: right right, Yeah, I think what's so astonishing about the
Speaker 1: reporting is the US making the case this is part
Speaker 1: of a program of espionage and led espionage. We cover
Speaker 1: tech on the show. We haven't quite gone there yet
Speaker 1: on the tech used for spying. And it's an astonishing
Speaker 1: picture they've painted about what's not just one isolated incident. Yeah,
Speaker 1: and that's whether or not this was made in China
Speaker 1: technology or whether it was Western made. And they're in
Speaker 1: lies some of the tension that's just going to be
Speaker 1: I'm sure talked around around again over in Capitol Hill
Speaker 1: and right here, all right, exactly so, and I want
Speaker 1: to stay with Washington actually for a second. The idea
Speaker 1: of oversight, the idea of lawmaking, because former Twitter officials
Speaker 1: testified on Wednesday and basically told lawmakers that they should
Speaker 1: hold off on regulating online content until they better understand
Speaker 1: how social media companies work, telling lawmakers you don't quite
Speaker 1: get it yet, let's bring in Kurt Wagner for more.
Speaker 1: I mean, is that the idea they're saying, actually, you,
Speaker 1: the oversight bodies, should actually have a deeper understanding of
Speaker 1: how we actually work before you go jumping into regulating. Yeah,
Speaker 1: and remember we have been having this conversation for years now, right,
Speaker 1: We've been talking about it with Facebook, with YouTube, with Twitter.
Speaker 1: There is a big misunderstanding, I would say, among lawmakers
Speaker 1: as to, uh, you know what section through two thirty
Speaker 1: does for companies and in some cases sort of the
Speaker 1: difference between that and the First Amendment, right and what
Speaker 1: companies are required by law to do and not. And
Speaker 1: so I think there's this feeling that everyone Democrats and
Speaker 1: Republicans are kind of rushing for order to change this.
Speaker 1: They think it's not working how it is, and they
Speaker 1: all want to change it, but that they don't necessarily
Speaker 1: have a grasp on how it should be changed. Let's
Speaker 1: look at it from the company's perspective. You've been very
Speaker 1: busy for a year or so covering Twitter, but you
Speaker 1: do cover social media broadly. How important is Section to
Speaker 1: thirty from the company's perspective, It's incredibly important. It's it's
Speaker 1: probably the most important kind of legal protection that they have,
Speaker 1: right because in general, what this means is that they
Speaker 1: can't be legally liable when some of their users post things. Right,
Speaker 1: so long as they're taking down things like child pornography
Speaker 1: or terrorists content or other things, you know, they're not
Speaker 1: going to be legally held when you know you d
Speaker 1: or Nie Kurt comes and says something that might get
Speaker 1: them into trouble, and so um. You know, they've said
Speaker 1: that if these are protections are repealed, it will actually
Speaker 1: be worse because they'll have to take down a lot
Speaker 1: more stuff to protect their own back many that much
Speaker 1: of that is sort of looking at fact checking, their
Speaker 1: own fact checkers and how you protect that. Interesting me
Speaker 1: over in Europe, Twitter has also caught the eye of
Speaker 1: the regulators because they're worried that there's just not enough
Speaker 1: power in place, enough commitment to empowering fact checkers. They're
Speaker 1: they're worried about disinformation in particular. Right, Yeah, well, Carolina,
Speaker 1: what's interesting as we're seeing this not just in the EU,
Speaker 1: but kind of in general, that regulators are really taking
Speaker 1: a tough look at Twitter because they've just lost so
Speaker 1: many people. There's a lot of skepticism that they can
Speaker 1: continue to do the kinds of things they need to
Speaker 1: do from a privacy or in this case, fact checking standpoint.
Speaker 1: As you mentioned the EU, you know, a bunch of
Speaker 1: tech companies are supposed to hand over sort of their
Speaker 1: plans for misinformation. Twitter's was inadequate, and so you know,
Speaker 1: again there's there's a concern that because Ellen came in
Speaker 1: and just fired so many people with institutional knowledge of
Speaker 1: the company, that they just are having enough troubles keeping
Speaker 1: the site up. They're not necessarily able to do the
Speaker 1: other things that the regulators expect them to do. And
Speaker 1: I just want to take a bit of a pivot cut.
Speaker 1: And it's an emotive subject Turkey at the moment, the
Speaker 1: need for social media, the need for sharing of information.
Speaker 1: But Twitter itself was down at one point. Can you
Speaker 1: talk us through anything you know on that front. Yeah,
Speaker 1: I mean there's still a lot that is unknown. But
Speaker 1: the timing was, of course terrible. Right. We saw that
Speaker 1: Twitter was down earlier this week, right when a lot
Speaker 1: of the safety groups were trying to organize on Twitter,
Speaker 1: when it was being used for important and critical information sharing.
Speaker 1: You know, we saw Elon Musk, you know who's now
Speaker 1: running Twitter, of course say that. Um, you know, they
Speaker 1: got word from the government that that was going to
Speaker 1: be reinstated, and I believe it has been. But again,
Speaker 1: the timing was terrible. Um, it's always bad when something
Speaker 1: like that happens, but in the wake of a natural
Speaker 1: disaster like that. Um it just really you know, put
Speaker 1: Twitter once again in the lime light. There, well said
Speaker 1: cut Wag. Now, we thank you so much for the
Speaker 1: latest in terms of the business. What is facing let's
Speaker 1: talk about well, the pressure from a regulatory perspective and
Speaker 1: perhaps the lack of investors now able to push for
Speaker 1: that too. A junior capital is no, well, it's a
Speaker 1: real expert in this field. In fact, the managing partner
Speaker 1: and former Twitter activists investor joined us. Now Natasha Lamb
Speaker 1: for more on this. And you know you are of
Speaker 1: course deeply knowledgeable on when it was a publicly traded
Speaker 1: company and the pressure you could exert it no longer is.
Speaker 1: And how difficult does that therefore mean in terms of
Speaker 1: making change and making sure that the right regulation and
Speaker 1: the right compliance is in place. Oh, I think unfortunately
Speaker 1: we've just frozen on, Natasha. But let's talk about this, said,
Speaker 1: because I think where our junior capital had found it was.
Speaker 1: I think she's back, Natasha. We can go to you.
Speaker 1: The fact that you no longer can exert pressure from
Speaker 1: a publicly traded an investor perspective, But what pressure can
Speaker 1: regulators now wield on something like Twitter? I mean I
Speaker 1: think that's that's the crux of it that you know,
Speaker 1: decide the fact that investors for the last six years
Speaker 1: have been asking companies to clean up their act have
Speaker 1: had some success in getting transparency. UM, it's clear that
Speaker 1: the companies are not doing enough. Twitter is not doing enough.
Speaker 1: It's now private, and it brings up a host of
Speaker 1: concerns as to whom Twitter is accountable to, other than
Speaker 1: Elon musk UM. So now with Twitter no longer a
Speaker 1: public company, no longer having that level of accountability to investors,
Speaker 1: it's going to have to be accountable to regulators because
Speaker 1: you know, time just keeps going by and nothing, uh,
Speaker 1: nothing's happened. There is not UM a level of standard
Speaker 1: here that is preventing some of the harm that's being done.
Speaker 1: And recently you've seen action on a number of fronts.
Speaker 1: We saw President Biden call for bipartisan regulation of social
Speaker 1: media companies. Just like last night at the sort of
Speaker 1: Union UM, this month's expected Twitter will have to think
Speaker 1: the strictest content rules UM in the European Union because
Speaker 1: of the number of large active users that it has UM.
Speaker 1: And we're seeing cases go before the Supreme Court UM,
Speaker 1: who's hearing cases this month on weather. Social media companies
Speaker 1: it or being one of them, are responsible for propagating
Speaker 1: growist content and attached on delights to have you on
Speaker 1: the program. You've been coming on for a very long time,
Speaker 1: and respectfully, I feel a sense of deja vu. UM.
Speaker 1: My question is, you know, when are these things that
Speaker 1: you're going you're calling for going to happen. I'm not
Speaker 1: sure what's changed now from say two or four years ago.
Speaker 1: I mean, I think it's a really fair question. And
Speaker 1: you know, obviously investors were not able to exert enough
Speaker 1: pressure for the companies to clean up their act on
Speaker 1: their own UM, and so regulations seems to be kind
Speaker 1: of the last ditch effort UM. And you know, I
Speaker 1: if you look at you know, section to thirty, which
Speaker 1: the previous gentleman was speaking about, UM to protect these
Speaker 1: companies against legal liability. But it's clear the policy needs
Speaker 1: to evolve because of the level of harm that's being done.
Speaker 1: Look at a lects, look at genocide that's happened, UM,
Speaker 1: public health crime, the government insurrection, UM. These they are
Speaker 1: all issues that ride to a level that government regulation
Speaker 1: is needed. And we know how difficult it is in
Speaker 1: this country to get bipartisan support. Um, but really that's
Speaker 1: what's needed, Natasha, dig in there, because this is so nuanced.
Speaker 1: This argument you want it to evolve is the regulation.
Speaker 1: Do you have confidence that the regulators get the need
Speaker 1: to protect certain elements, perhaps that companies might argue for
Speaker 1: their own self moderation so that to thirty can evolve
Speaker 1: in the right ways. Do you think Yeah? I mean,
Speaker 1: I think it's a fair point. Policymakers are policymakers, and um,
Speaker 1: you know they're they're not tech experts, and this space
Speaker 1: has evolved so much over the last decade that regulators
Speaker 1: are looking to catch up that that I think is
Speaker 1: why it's Oh, dear, we've just had another technical glitch.
Speaker 1: Are you still there, Natasha? I think we might have
Speaker 1: lost her carrow, which is a shame, because you know,
Speaker 1: her point is something has to happen, and she's signing
Speaker 1: the recent references of President Biden addressing this last night.
Speaker 1: The point I was trying to make to her is
Speaker 1: we've heard President Biden say that before in previous speeches.
Speaker 1: It's sort of not new territory. What I would have
Speaker 1: asked her is just because Twitter is now private, and
Speaker 1: just because it's owned by Elon Musk. Does that add
Speaker 1: more impetus or more energy from lawmakers to do something
Speaker 1: or regulate to do something. It's hard to say yeah.
Speaker 1: And in many ways Europe is worried by the fact
Speaker 1: that this is now a privately held company. They've been
Speaker 1: flagging ever since he took the company private, that they
Speaker 1: want to see the right commitments put in place to
Speaker 1: tackle things and disinformation. I hate to set as a
Speaker 1: brit but time and time again it feels like Europe
Speaker 1: needs the charge. And actually, you know, the Britain doesn't
Speaker 1: have much to do with some of the European regulation
Speaker 1: that's now coming into place. But ultimately Europe does seem
Speaker 1: to be able to get the right regulation in place
Speaker 1: in many ways, or at least drive it forward, and
Speaker 1: it often leaves the US playing catch up in some way. Well,
Speaker 1: what is it that the said Ellen Musk in Twitter
Speaker 1: will fly by our rules? Which I thought was a
Speaker 1: very quick and witty poke, and we know that Elon
Speaker 1: Muster has been talking to Europe. It's one will continue
Speaker 1: to track now coming up. Unfortunately, more job cuts underway,
Speaker 1: with Delivery slashing nine percent of its staff. Will get
Speaker 1: more of the details in Talking Tech. That's next Curac
Speaker 1: And let's a quick look at another after ours, Mover,
Speaker 1: because there have been plenty after this, earnings coming thick
Speaker 1: and fast. Actually Experience managing to bounce off of its loans.
Speaker 1: We're currently off by only two percent now had some
Speaker 1: more than sem percent at one point. All of this
Speaker 1: regarding the online travel agency, Yes they missed estimates in
Speaker 1: terms of the holiday sales, but all that to do
Speaker 1: with weather. So some analysts out there saying, look, actually
Speaker 1: this was a miss, but there were temporary reasons behind
Speaker 1: it related to some poor weather, and demand remains robust.
Speaker 1: Well to come in terms of the earnings front, visa
Speaker 1: bloom time Now for Talking Tech. First up, Apple hiring
Speaker 1: its first Chief People Officer and removing HR responsibilities from
Speaker 1: its head of retail, overhauling the way the company hires
Speaker 1: and supports employees. In a memo to employees, Tim Cook
Speaker 1: announced Carol Surface will assume the role and said quote
Speaker 1: she brings an incredible depth of experience. Microsoft will begin
Speaker 1: color coding employees expense reports as part of a new
Speaker 1: agreement with American Express. This comes as the tech giant
Speaker 1: already announced its slashing thousands of jobs The company will
Speaker 1: integrate the technology into its internal expense system later this year,
Speaker 1: with employees uploading photo is of receipts, which will be
Speaker 1: coded as green if automatic approval is recommended, yellow if
Speaker 1: it needs another look, or red Caroline if it should
Speaker 1: be denied. And Delivery a latest company, unfortunately to announce
Speaker 1: job cuts. The food delivery business will slash three fifty jobs,
Speaker 1: focusing of course on profits and a way to deal
Speaker 1: with what is difficult consumer environments right now. CEO Will
Speaker 1: Shoe said the cuts will effect roles at all levels,
Speaker 1: although some employees will be really deployed. Caroline certainly company
Speaker 1: that has been used a lot in London over the years,
Speaker 1: and I know we are going to take a really
Speaker 1: hard look at the cost for everything that we make,
Speaker 1: both across television and film, because things in a very
Speaker 1: competitive world have just simply gotten more expensive. And that's
Speaker 1: something that is already under right here, I'll come back
Speaker 1: to Bloomberg Technology. I'm Caroline had in New York and
Speaker 1: well Disney CEO Bob Biger. They're speaking on the company's
Speaker 1: earnings call that was about twenty four hours ago. Ed
Speaker 1: what a lot has changed in those twenty four hours,
Speaker 1: it feels like, yeah, it's all about restructuring. And you know,
Speaker 1: the bigger news probably that Peltz has pulled back this
Speaker 1: activist investors stepping away from ambition to take a board seat,
Speaker 1: push for change at Disney, because change is what we've got.
Speaker 1: The statements short and sweet. The proxy fight is over.
Speaker 1: This is a win for all shareholders. And the question
Speaker 1: we've been asking for twenty four hours or so is
Speaker 1: what placated Pelts. I've got this terminal chart that kind
Speaker 1: of tells the story and the challenge for Eiger. They're
Speaker 1: targeting five point five billion dollars of cost savings. Right,
Speaker 1: you look at the white line, which is the top line,
Speaker 1: essentially revenues at record levels but sales slowing. Then you
Speaker 1: go down to their income and operating profit or net
Speaker 1: profit down the bottom were still at half where we
Speaker 1: were from the pandemic peak. And that's really SEMs to
Speaker 1: be what is going off to and it also seems
Speaker 1: to be enough to cheer investors. So let's get more
Speaker 1: in that and bring in Bloomberg's entertainment editor out in
Speaker 1: our l A, Chris Palm Mary. Same question to you, Chris,
Speaker 1: what placated Pelts. Well, you could see a lot of
Speaker 1: reasons for this, you know, despite his reputation Try and
Speaker 1: Partners since it's founding in two thousand five. They know
Speaker 1: this was only their fourth proxy fight out of thirty
Speaker 1: times they've engaged these companies that you know, this isn't
Speaker 1: something they really want to do. They preferred to sort
Speaker 1: of negotiate an appearance on the board. And uh, it's expensive.
Speaker 1: And I think they've spent twenty five million fighting Procter
Speaker 1: and Gamble proxy fight. So that's number one. Number two
Speaker 1: is Eiger addressed a lot of the things that Nelson
Speaker 1: Peltz was complaining about on the call yesterday. Cost Cutting
Speaker 1: said the board would consider reinstating the divid end. Already,
Speaker 1: the stocks up quite a bit this year since Nelson
Speaker 1: Peltz started buying, so he's sitting on an ice game.
Speaker 1: So I think all of those factors and just maybe
Speaker 1: the fear of losing if if it came down to
Speaker 1: that in a vote Naple made him rethink interesting talk
Speaker 1: to us. Therefore, also the enthusiasm perhaps being served up
Speaker 1: around the restructuring Ultimately previous activist investors. I'm thinking of
Speaker 1: Dan loeb Wold want to see the spinoff of ESPN.
Speaker 1: A lot of talk around that after this restructuring, the
Speaker 1: fact that it's now stand alone, But actually we all
Speaker 1: started talking about Hunu as well after today, right, I mean,
Speaker 1: so Bob Iger said on a call yesterday that yeah,
Speaker 1: they are for the first time really spelling out exactly
Speaker 1: how much money ESPN makes, which you could see as
Speaker 1: a signis im prepping it first spin off, But he
Speaker 1: said that's not why they're doing it, but certainly it
Speaker 1: is going to allow investors to take a look at
Speaker 1: that piece of the business in a way that they
Speaker 1: haven't before. And and so on Hulu, he said this
Speaker 1: morning that, um, you know, he said he has a
Speaker 1: deal to buy the other third of it from Comcast
Speaker 1: next year, but the price is not there's a floor price,
Speaker 1: but not a specific price, and so both Comcasts and
Speaker 1: he said, oh, you know, we're interested. You know, maybe
Speaker 1: we're not. I mean, I think there's a bit of
Speaker 1: game dismanship going on here. I think ultimately Bob Iger
Speaker 1: would like to own the rest of Hulu and incorporated
Speaker 1: in the rest of Disney streaming businesses. What else would
Speaker 1: Bob blake in terms of how long he's going to
Speaker 1: be there for example, Well, of course, you know, the
Speaker 1: perennial issue is who's going to replace him, and he's
Speaker 1: he said he's going to stick around for just two
Speaker 1: more years. Big you know announcements today in terms of
Speaker 1: the people running the major businesses. Uh and so, um,
Speaker 1: you know that's going to be a focus of him
Speaker 1: and Mark Parker, the new chairman who takes over in April.
Speaker 1: Uh and uh, but you know, I think Bob fundamentally
Speaker 1: he'll say this, Uh, it really cares about the creative.
Speaker 1: And he's admitted that animation and Disney needs a little work.
Speaker 1: He said, they've you know, produced a little too much content. Uh.
Speaker 1: You know, Disney has always been kind of about you
Speaker 1: know a few big great movies and not you know,
Speaker 1: everything everywhere, uh to quote another film. So so I
Speaker 1: think creative is going to be a big focus. Hey, Chris,
Speaker 1: let's go about to basics to finish. What does the
Speaker 1: new look Disney look like? The three parts that it's
Speaker 1: being reformed into. Well, you're seeing the merger definitively of
Speaker 1: movies and TV there's basically one division and and streaming.
Speaker 1: So so that's all becoming just basic general entertainment and
Speaker 1: family content than a separate sports streaming business and TV business,
Speaker 1: and then of course the parks and the cruise ships
Speaker 1: and the consumer products. So it's it's pretty clearly defined.
Speaker 1: I think, um, you know, maybe some people would like
Speaker 1: to see more. You know, the film businesses exists separately,
Speaker 1: but you know that's the direction it's going now. You know,
Speaker 1: theaters are less important than streaming. Chris pal marry and
Speaker 1: has been a busy twenty four hours for you as well.
Speaker 1: We thank you so much for bringing us up to
Speaker 1: speed with the audience and the outs of Disney versus
Speaker 1: no longer Pelts it would feel like I meanwhile, another
Speaker 1: story that we continue to watch. It's been busy in
Speaker 1: crypto crack and will pay thirty million dollars to settle
Speaker 1: SEC allegations that it broke US rules with its crypto
Speaker 1: asset staking products and it will discontinue them in the
Speaker 1: United States as part of the agreement with the regulator
Speaker 1: to break it all down. As she always does so well,
Speaker 1: bloom Berg's Snelly Bassett is here with more And was
Speaker 1: this ultimately a surprise for you? I don't think it was. However,
Speaker 1: it is a really really big deal. We knew that
Speaker 1: staking was one of the things that the SEC would
Speaker 1: ultimately look out when they looked at the broader crypto ecosystem,
Speaker 1: but in all the things that they were looking at,
Speaker 1: when you think about other forms of tokenization and f
Speaker 1: t s, the fact that steaking has really made its
Speaker 1: way up on the list of things a SEC is
Speaker 1: looking at is a surprise. Now, the thirty million dollars,
Speaker 1: it's not a it's not a small sum, but it's not,
Speaker 1: you know, a sum that would really break the bank
Speaker 1: here for many of these companies. But it's about future activity.
Speaker 1: You had this thread yesterday from the CEO of coin
Speaker 1: base on Twitter. Are really talking about how staking is
Speaker 1: such an important innovation for crypto, allowing scalability, increased security,
Speaker 1: reduced carbon footprints for the industry, and you saw that
Speaker 1: as a lot of the rationale for the reason of
Speaker 1: the theory, I'm really moving to the proof of steak
Speaker 1: model to begin with. So this is a big deal
Speaker 1: for a theory m it's a big deal for the
Speaker 1: exchanges that have been offering staking as a service. Coin Based,
Speaker 1: by the way, the shares were down more than on
Speaker 1: the day because of how much they've been moving to
Speaker 1: these services for clients. In the most recent quarter they
Speaker 1: had talked about how investing in Staking as a service
Speaker 1: had been really benefiting them since and when users moved
Speaker 1: from trading to non trading transactions like staking, it really
Speaker 1: helped boost their subscription and services revenues. So let's see
Speaker 1: what they have to say at the end of the
Speaker 1: month when they report earnings, because as a public company
Speaker 1: you see it most directly in results like that for
Speaker 1: full disclosure of my husband's a senior manager over it
Speaker 1: coin base, But ultimately with how big a deal is
Speaker 1: staking for the ecosystem more generally? And and does this
Speaker 1: signal that the SEC could get his head around it
Speaker 1: in a different format and just cracking wasn't there in
Speaker 1: the right way at the right means or is this
Speaker 1: sort of dead in the water as many would fear now.
Speaker 1: Listen the statement from the SEC chair Gary Gansler in
Speaker 1: this Krakens settlement, if you will, had a very broad statement.
Speaker 1: It was whether it's staking as a service, lending or
Speaker 1: other means, crypto untermediaries and they're offering investment contracts in
Speaker 1: exchange for investors token need to provide proper disclosures and
Speaker 1: safeguards required by our securities law. So he's bringing in
Speaker 1: the staking business under the securities umbrella. Remember, hester Parse,
Speaker 1: a commissioner, had also said that she really disputes what
Speaker 1: happened here today because there should have been better guidelines
Speaker 1: from the beginning, and by the way that has been
Speaker 1: the industry kind of exactly set the guidelines first and
Speaker 1: then let us follow them, rather than finding us for
Speaker 1: not following guidelines that we have not set. Excuse me
Speaker 1: if I'm like going outside of your field au pur view,
Speaker 1: but I feel like you cover it all. What are
Speaker 1: the rest of the world thinking about staking? Ultimately? You know,
Speaker 1: I think if you're an individual investor and you are
Speaker 1: into crypto and want to be more engaged, it is
Speaker 1: a kind of difficult calculation here because moving from mining
Speaker 1: to staking. In theory, staking should have been allowing more
Speaker 1: people to get in at scale, especially if you work
Speaker 1: through a service like coin base or crack in or
Speaker 1: some of these other services that allow staking at scale
Speaker 1: for a more wide range of investors. In f t X, well,
Speaker 1: that's the thing. So we were talking about this in
Speaker 1: the commercial break and interestingly, according to my sources, f
Speaker 1: t X in the US as they were considering the
Speaker 1: businesses when they were still, you know, a proper business
Speaker 1: before the bankruptcy and before these allegations, they had not
Speaker 1: offered staking from my knowledge, because they were worried about
Speaker 1: the SEC coming down on it. So it's hard to
Speaker 1: say that the industry didn't know that this was going
Speaker 1: to be an issue at some point, and now it
Speaker 1: clearly is. Joan Ai Bassak, we thank you so much.
Speaker 1: I mean, what have you got some more? Yeah, I'm
Speaker 1: really looking forward to what's next. Two billion dollar loan
Speaker 1: commitment from the White House to produce a million evs
Speaker 1: a year. Redwood Materials CEO and of course one of
Speaker 1: Tesla's co founders, JB. Struggle, joins us next for more
Speaker 1: on that loan, which was the same program, by the way, Carrol,
Speaker 1: that helped launch Tesla all those year years ago. Look,
Speaker 1: we've got to get back to lift declines accelerating in
Speaker 1: after hours towards the thirty percent mark and deeper at
Speaker 1: some point, headlines crossing from the cool lift cut prices
Speaker 1: for rides in January to quote remain competitive, They're going
Speaker 1: to go deep into cock cut costs. Cuts. They're going
Speaker 1: to reduce stock based compensation. This does not look good, Caroline,
Speaker 1: and clearly the share reaction after ours speaks to that.
Speaker 1: We'll keep tracking more details. This is Bloomberg America's battery
Speaker 1: supply chains getting a bit of a jump start. Redwood Materials,
Speaker 1: which was created by Tesla co founder JB. Strawbile, received
Speaker 1: a two billion dollar lone commitment from the Biden administration
Speaker 1: to build enough critical battery components to produce a million
Speaker 1: e vis a year. I'm pleased to say that JB.
Speaker 1: Strawble joins us now. JB. We were talking in the
Speaker 1: preamble about how back in the day Tesla went through
Speaker 1: down a similar path. But this is a fair chunk
Speaker 1: of change. More, my colleagues have written so much, including
Speaker 1: Gabby Coppler, about the supply chain emphasis here in the
Speaker 1: United States. What are you going to do with two
Speaker 1: billion dollars? Give me the gritty details of what that
Speaker 1: does for Redwood Materials. Well, this, this is a huge
Speaker 1: word of confidence, I'd say, into the American supply chain
Speaker 1: and building the supply chain here, expanding the capacity of
Speaker 1: it here. You know, it is a very capital intensive industry.
Speaker 1: And you know, even though this is a vast amount,
Speaker 1: a large sum of money. Um, this is not funding
Speaker 1: the entire project. You know, we have to match that
Speaker 1: project with private capital, private equity that that we raise
Speaker 1: and invest. And you know, even even with this large
Speaker 1: of a project, you know, we're still only meeting a
Speaker 1: relatively small percentage of the overall US demand for battery materials.
Speaker 1: So it is, uh, is quite phenomenal. How much growth
Speaker 1: has to happen into the future and how much investment
Speaker 1: has to happen JB. You alluded to it. So I'll
Speaker 1: go there, two billion dollars a lot of money. But
Speaker 1: will you have to raise more funds and how will
Speaker 1: you go about doing that? We we have raised a
Speaker 1: lot of private funding in the past through the history
Speaker 1: of our company, and uh we'll continue to. Um, you
Speaker 1: know it. It does make it easier as we see
Speaker 1: the strong support and these strong indications of support from
Speaker 1: the federal government. Really for the first time in this sector.
Speaker 1: I mean this, this is the very first federal funding
Speaker 1: that we've seieved of any sort, and I believe some
Speaker 1: of the first federal funding that's that's going into the
Speaker 1: battery supply chain at this magnitude. So while we will
Speaker 1: raise additional private capital and you know, continue doing that
Speaker 1: in in in turn, um, you know, it'll it'll match
Speaker 1: with this and enjoying with federal loans as well. Talk
Speaker 1: to us about the politicization to a certain extent of
Speaker 1: the federal loans, but ultimately people worry about not just
Speaker 1: how much due diligence has done in the companies that
Speaker 1: ultimately get the funding. Previous issues have been in the
Speaker 1: prior naughties. But talk to us about China as well.
Speaker 1: Is there reality to some of the concerns, particularly by
Speaker 1: the GOP, about that this gives in some way China
Speaker 1: access to such money. Well, I can definitely say firsthand
Speaker 1: that there's extensive diligence that goes into these programs. You know,
Speaker 1: we've been working on this, this particular loan application for
Speaker 1: well over a year, almost a year and a half, um,
Speaker 1: you know, and going through multiple layers of diligence on finance,
Speaker 1: on technology, on market uh and customer you know fit.
Speaker 1: So I feel that there's quite a robust process that
Speaker 1: the Department of Energy and the loan program has rolled
Speaker 1: out for this, and it's been refined over many years.
Speaker 1: As you've you've mentioned, um, you know, even more than
Speaker 1: ten years ago, the same exact program UH was still
Speaker 1: in existence and was making loans to companies that targeted specific,
Speaker 1: very strategic areas for the country. Yeah, cylinder, of course
Speaker 1: is kind of the prior concern that some have, But
Speaker 1: give us the real concerns now in terms of a
Speaker 1: focus on a supply chain that people want to bring
Speaker 1: to the United States that you're trying to answer that
Speaker 1: call of and ultimately whether we can rump up the
Speaker 1: amount of evs made while cutting out China from the
Speaker 1: supply chain. Well, I think it's going to be a transition.
Speaker 1: And uh, you know, today the vast majority of the
Speaker 1: mattery supply chain is imported from overseas, and much of
Speaker 1: that from China. So I think, um, you know, the
Speaker 1: key is to have is an organized transition and to
Speaker 1: start investing today in building this capability. But we can't
Speaker 1: turn it on overnight, even you know, with all of
Speaker 1: the efforts we're doing and more, this will take you know,
Speaker 1: several years, many years to to ramp and build that
Speaker 1: that supply chain and capability here. Um, but this is
Speaker 1: a huge economic incentive for the country. There are many,
Speaker 1: many billions of dollars that would be exported overseas to
Speaker 1: build the same supply chain. If we don't begin the
Speaker 1: work now, JB. You tolkeds about many years of planning
Speaker 1: marks the first we get master Plan part three from
Speaker 1: your friend and former colleague Elon Masque actually is here
Speaker 1: current colleague. Is Tesla a customer of Redwood Materials. Well,
Speaker 1: we we don't have any partnership with Tusla that I
Speaker 1: can talk about today. But um, but I would say,
Speaker 1: you know, Ellen is very much a friend. I'm still
Speaker 1: rooting work Tesla. Um. I think it's a fabulous company.
Speaker 1: And you know they've clearly been the leader in this
Speaker 1: entire movement and really remains so. All right, J V.
Speaker 1: Strawbol Redwoods material founder and CEO. When Tesla is officially
Speaker 1: a customer, come back on the show with Caroline and
Speaker 1: I and talk about how that's gonna work. Okay, fair enough. Now,
Speaker 1: as the generative AI race heats up, we all talk
Speaker 1: about it. The impact on a company share price something
Speaker 1: to be pretty significant. Take Google for example, parent is
Speaker 1: course Alphabet It's a hundred million dollars wiped from its
Speaker 1: market capitalization after unveiling its barred AI technology that fas
Speaker 1: questions over accuracy. That's far bigger than the two point
Speaker 1: eight percent drop on the day after Alphabet's earnings missed estimates,
Speaker 1: So clearly the impact there were seeing remarkable moves and
Speaker 1: some of the AI link tickers and names that we've
Speaker 1: seen C three aig Bear is another one. AI keep
Speaker 1: a clean eye on these sorts of companies. But let's
Speaker 1: stick with the overall artificial intelligence theme. Because Trip Actions,
Speaker 1: as a name you used to know as a business
Speaker 1: travel software startup, their plans to integrate open a eyes
Speaker 1: chat chypt capabilities across its online platform, an effort aimed
Speaker 1: at seizing market share by making expense reports easier to use.
Speaker 1: That As part of a move, the company is also rebranding.
Speaker 1: It's changing its name Navan, joining us now as Aerial
Speaker 1: Cohen Navan, CEO co founder talk to us about the rebrand,
Speaker 1: but ultimately talk to us about how important is for
Speaker 1: B to B, for enterprise companies and software companies to
Speaker 1: integrate chat chypt. What lift does it give your business? Yeah,
Speaker 1: first of all, I'm very happy to be here and
Speaker 1: share with you a new blend and now you're kind
Speaker 1: of everything that we do, and it's all kind of
Speaker 1: designed to support in one side the company and all
Speaker 1: of the needs of the company policy, safety, saving costs,
Speaker 1: which is very importantly in the recession, but on the
Speaker 1: other s, supporting the employees, really making them out of
Speaker 1: this journey and church AI is actually it was always
Speaker 1: an integral part of our solution for seven years and
Speaker 1: really making sure that the employees can book stuff super
Speaker 1: super fast, expense things extremely fast. And the recent addition
Speaker 1: takes it to the next level. UM I can give
Speaker 1: you some examples of how much it is becoming more
Speaker 1: and more powerful for our users and for everybody. I
Speaker 1: promise we get to examples. I really want to know
Speaker 1: what it's like doing a transaction with the open AI.
Speaker 1: We talked about them every day. Closed profit business. Everyone
Speaker 1: wants to get access to the underlying algorithms. You've had
Speaker 1: access for a little while. Do they charge you a lot?
Speaker 1: What's the business relationship? Was this the best deal you've
Speaker 1: ever done in your career? No? Like now it's a
Speaker 1: it's a it's actually services business, very very similar to
Speaker 1: what you get with a WS and and the stuff
Speaker 1: like that. But we're at the beginning, so we need
Speaker 1: to see how the inputs and outputs of data will walk.
Speaker 1: So we still don't know, and I think that they
Speaker 1: still don't know. We're learning it together. Okay, so we
Speaker 1: just write what you offer at the beginning of the segment. Respectfully.
Speaker 1: You know it's a very business transactional, heavily service. But
Speaker 1: how has the underlying tech improved your offering? So we
Speaker 1: always had the chetbot that you can actually ask dead
Speaker 1: boat to book your trip, your entire trip, if you'd
Speaker 1: ask that before we integrated open ai. If you want
Speaker 1: to book a hotel in in New York, you'll ask
Speaker 1: the book the West Inn and it will ask you
Speaker 1: why do you want me to book? Now it will
Speaker 1: actually know the West Inn and it will ask you
Speaker 1: in what dates do you want to book it? So
Speaker 1: context matters a lot, and this is really what this
Speaker 1: integration gives us. A lot of context ultimately does set
Speaker 1: you apart from your competitors. How big a modes do
Speaker 1: you think you can build by educrating chat GPT if
Speaker 1: others can license this sort of productivity software and chat board. Yeah,
Speaker 1: the first mode was actually to move business travel and
Speaker 1: expense management to be an online process because I'll compere
Speaker 1: it will basically you're still call an agent, right, and
Speaker 1: we've moved it to online seven years ago and now
Speaker 1: we are taking it to the next level by really
Speaker 1: riding on the capabilities of online. What's the risk? What
Speaker 1: happens if your chat box says something that is not
Speaker 1: true or inaccurate, or causes a customer to do something
Speaker 1: they didn't want to do. Yeah, we are playing a
Speaker 1: lot with this and like any technology, it definitely has
Speaker 1: its limitation. So we actually like anything that you implement,
Speaker 1: we know its limitations. We know when we need to
Speaker 1: kick off an agent, a re agent that will actually
Speaker 1: intervene and do the right thing. There. Really interesting. Thank
Speaker 1: you for sharing us the journey and also the rebrand
Speaker 1: aerial Cohen Navan, CEO and co founder. Now that does
Speaker 1: it for this edition of bloom Bag Technology, Do not
Speaker 1: forget to tune in tomorrow. Bloomberg Technology has got a
Speaker 1: special Twitter Spaces too, So before you get this joyous
Speaker 1: show and they come and join us at twelve o'clock
Speaker 1: New York time, it's nine am in your time for
Speaker 1: Twitter Spaces conversation. Yeah, I'm going to do what I
Speaker 1: do every week. We have a special guest and I'm
Speaker 1: not going to tell you who it is, but I
Speaker 1: will say, is this person's birthday. They've been on the
Speaker 1: show this week and they've got a really important story
Speaker 1: to talk about. Yeah, And there's also so many important
Speaker 1: stories to get up close and personal with some of
Speaker 1: our on the ground reporters. So we're going to have
Speaker 1: the main key stories take away and just the inside
Speaker 1: track on what these reporters are hearing, seeing, feeling, and
Speaker 1: ultimately how they break the stories in. Yeah. And I
Speaker 1: think what I'm most excited about is it's not just
Speaker 1: earnings continuing to drive markets. Individual headlines and artificial intelligence
Speaker 1: such a big part of that, CAAC. And what's important
Speaker 1: is that this is a two way street. Get to
Speaker 1: ask your questions directly within the Twitter spaces. Come join us.
Speaker 1: This is Bloomberg