1 00:00:02,600 --> 00:00:07,320 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:08,800 --> 00:00:09,520 Speaker 2: From Mahard. 3 00:00:09,640 --> 00:00:14,080 Speaker 3: We're Innovation, Money and Power Collie in Silicon Valley, NBN. 4 00:00:14,440 --> 00:00:18,440 Speaker 4: This is Bloomberg Technology with Caroline Hyde and Ed Ludlow. 5 00:00:32,280 --> 00:00:34,839 Speaker 5: I'm Caroline Heid at Bloomberg's World headquarters in New York. 6 00:00:34,960 --> 00:00:37,880 Speaker 6: And I Amed Ludlow in San Francisco. This is Bloomberg. 7 00:00:37,440 --> 00:00:38,680 Speaker 7: Technology coming up. 8 00:00:38,760 --> 00:00:42,600 Speaker 5: Intel, it slides amid some tepid forecasts. We're going to 9 00:00:42,680 --> 00:00:45,080 Speaker 5: discuss all of that with the CEO, Pat Girl Singer. 10 00:00:45,720 --> 00:00:49,200 Speaker 6: Plus Microsoft and Google posts strong results on AI demand 11 00:00:49,280 --> 00:00:50,960 Speaker 6: for cloud full coverage ahead. 12 00:00:50,760 --> 00:00:54,000 Speaker 5: And Jeff Bezos and Andy Jesse deleting chats in an 13 00:00:53,960 --> 00:00:57,200 Speaker 5: anti trust probe. Now that's according to the FTC. We 14 00:00:57,240 --> 00:00:59,720 Speaker 5: bring you their response and the details right now. 15 00:00:59,760 --> 00:01:01,440 Speaker 7: Caro, we start with semiconductors. 16 00:01:01,480 --> 00:01:01,760 Speaker 4: We do. 17 00:01:01,840 --> 00:01:05,040 Speaker 5: Let's dig in on ill things Intel. Blumberg's in king 18 00:01:05,200 --> 00:01:08,960 Speaker 5: was on, of course, across the earnings last night, discussing 19 00:01:09,040 --> 00:01:11,240 Speaker 5: with the business and look, this seems to be a 20 00:01:11,240 --> 00:01:12,440 Speaker 5: worry about forecasts. 21 00:01:12,520 --> 00:01:15,080 Speaker 8: Q one actually pretty resilient. The forecast Teppid. 22 00:01:16,319 --> 00:01:19,479 Speaker 1: Yeah, no, you're absolutely right. All of the divisions performed 23 00:01:19,600 --> 00:01:21,600 Speaker 1: roughly where Wall Street was expecting. 24 00:01:21,640 --> 00:01:22,840 Speaker 2: If not a little bit better. 25 00:01:23,360 --> 00:01:26,600 Speaker 1: The issue that investors had was with the forecast that 26 00:01:26,720 --> 00:01:30,480 Speaker 1: Partner's team put out there, and I was considerably lighter 27 00:01:30,520 --> 00:01:35,200 Speaker 1: than the consensus, and that was explained by Partner's management 28 00:01:35,200 --> 00:01:38,039 Speaker 1: team as that being related to a structural issue that 29 00:01:38,440 --> 00:01:40,600 Speaker 1: some of the excess demand that out there can't be 30 00:01:40,680 --> 00:01:43,760 Speaker 1: met because of an issue with a shortages of a 31 00:01:43,800 --> 00:01:45,200 Speaker 1: certain type of manufacturing. 32 00:01:46,760 --> 00:01:49,000 Speaker 6: It's important about the server market. What did we learn 33 00:01:49,040 --> 00:01:51,080 Speaker 6: about Intel's place in the server market? 34 00:01:51,360 --> 00:01:54,760 Speaker 1: Yeah? I mean, as I forwarded along to you and 35 00:01:54,880 --> 00:01:57,600 Speaker 1: analyst to put it this way, look at the server market. 36 00:01:58,200 --> 00:02:00,639 Speaker 1: The fund you know, the basic server market that Intel 37 00:02:00,680 --> 00:02:03,920 Speaker 1: has owned for many years just isn't growing at a 38 00:02:04,040 --> 00:02:07,680 Speaker 1: rate that it has in the past because spending is 39 00:02:07,680 --> 00:02:11,320 Speaker 1: going elsewhere. It's going into AI accelerators and that isn't 40 00:02:11,320 --> 00:02:12,720 Speaker 1: a big market for Intel yet. 41 00:02:12,880 --> 00:02:16,000 Speaker 6: And finally, we should talk about foundry. Intel is unique 42 00:02:16,000 --> 00:02:18,560 Speaker 6: in that sense that it is pursuing two business models. 43 00:02:18,560 --> 00:02:19,399 Speaker 7: What did you learn there? 44 00:02:19,840 --> 00:02:22,040 Speaker 1: Yeah, I mean that's the big story, isn't it. That 45 00:02:22,639 --> 00:02:26,400 Speaker 1: you know, Pap is pursuing some long term fundamental changes 46 00:02:26,440 --> 00:02:30,120 Speaker 1: to the chip industry and if it plays out how 47 00:02:30,160 --> 00:02:33,080 Speaker 1: he projects, we're going to see a whole different Intel 48 00:02:33,080 --> 00:02:34,600 Speaker 1: and a whole different industry. 49 00:02:34,960 --> 00:02:36,079 Speaker 2: But in the meantime, he's. 50 00:02:35,960 --> 00:02:38,960 Speaker 1: Got a report quarterly earnings based upon what's happening right now. 51 00:02:39,160 --> 00:02:41,840 Speaker 6: Bloomberg's in king who leads our semiconduct to coverage here 52 00:02:41,840 --> 00:02:44,080 Speaker 6: at Bloomberg. Thank you very much, And Caro, you know 53 00:02:44,280 --> 00:02:47,240 Speaker 6: it's the earnings context, right. They are numbers relative to 54 00:02:47,280 --> 00:02:51,000 Speaker 6: street expectations, But like every earnings, it's about. 55 00:02:50,720 --> 00:02:52,560 Speaker 7: An outlook and the long term. 56 00:02:52,680 --> 00:02:55,359 Speaker 6: The story with Intel that I think the market's seizing 57 00:02:55,400 --> 00:02:56,000 Speaker 6: on right now. 58 00:02:56,120 --> 00:02:58,040 Speaker 8: The long term we want to dig into with a CEO. 59 00:02:58,120 --> 00:03:00,400 Speaker 5: In the short term, though, we have to ignore the 60 00:03:00,400 --> 00:03:02,560 Speaker 5: market reaction and one point the worst sell off that 61 00:03:02,600 --> 00:03:05,880 Speaker 5: we've seen since twenty twenty July of twenty twenty. We're 62 00:03:05,880 --> 00:03:07,600 Speaker 5: now coming off of those lows ed but we're now 63 00:03:07,600 --> 00:03:10,200 Speaker 5: at the worst since January twenty twenty four. But just 64 00:03:10,200 --> 00:03:11,680 Speaker 5: to add to the fact that this is a company 65 00:03:11,680 --> 00:03:15,040 Speaker 5: that's lost a third of its market capitalization in this year. 66 00:03:14,919 --> 00:03:19,679 Speaker 6: Alone, we know that AI is a complicated story. Yes, 67 00:03:19,840 --> 00:03:23,760 Speaker 6: AI accelerators, but the server market needs CPUs. It also 68 00:03:23,800 --> 00:03:27,200 Speaker 6: needs memory, which we discussed with Micron just the other day. 69 00:03:27,600 --> 00:03:30,040 Speaker 6: A lot of this is happening in parallel, and as 70 00:03:30,080 --> 00:03:32,760 Speaker 6: we learned with Microsoft and Google, some of the cloud 71 00:03:32,800 --> 00:03:37,320 Speaker 6: growth is not necessarily AI related. Data center infrastructure is 72 00:03:37,360 --> 00:03:41,000 Speaker 6: needed for non AI reasons as well. So let's try 73 00:03:41,000 --> 00:03:44,480 Speaker 6: and unpick what's happening in a name that, as you say, 74 00:03:44,800 --> 00:03:48,920 Speaker 6: is down. We welcome now our Bloomberg TV and radio 75 00:03:48,960 --> 00:03:53,640 Speaker 6: audiences worldwide, and joining us is the Intel CEO Pat Gelsinger. 76 00:03:53,680 --> 00:03:55,880 Speaker 6: A Pat, good morning to you and thank you for 77 00:03:55,920 --> 00:03:58,040 Speaker 6: your time. You know, the stock is down more than 78 00:03:58,080 --> 00:04:00,800 Speaker 6: ten percent, and we're kind of here again right where 79 00:04:01,360 --> 00:04:03,960 Speaker 6: there's the short term and the long term where you're 80 00:04:03,960 --> 00:04:07,920 Speaker 6: trying to convince investors of a return to technology leadership 81 00:04:08,680 --> 00:04:13,800 Speaker 6: and also grow a foundry business. Have you an updated 82 00:04:13,880 --> 00:04:16,440 Speaker 6: timeline and when you think you will achieve that target? 83 00:04:17,320 --> 00:04:17,560 Speaker 2: Yeah? 84 00:04:17,600 --> 00:04:20,840 Speaker 9: Thanks Ed, And obviously, hey, we delivered a solid Q one, right, 85 00:04:20,880 --> 00:04:24,520 Speaker 9: We met on revenue, We beat on earnings a bit 86 00:04:24,640 --> 00:04:26,520 Speaker 9: tep it in the first half, as we said, but 87 00:04:26,560 --> 00:04:29,320 Speaker 9: we see a lot of improvement as we go through 88 00:04:29,360 --> 00:04:33,120 Speaker 9: the year. And with that, obviously the foundry business, as 89 00:04:33,160 --> 00:04:35,080 Speaker 9: I would say, we're going to see progress in the 90 00:04:35,080 --> 00:04:37,919 Speaker 9: foundry business every quarter from now to the end of 91 00:04:37,920 --> 00:04:40,560 Speaker 9: the decade. It just gets better and better as we 92 00:04:40,600 --> 00:04:43,360 Speaker 9: move into our new technologies, you know, as we've said, 93 00:04:43,400 --> 00:04:47,560 Speaker 9: getting back to process leadership, which have better asps and 94 00:04:47,600 --> 00:04:50,360 Speaker 9: we can build better products with them. We win more 95 00:04:50,400 --> 00:04:54,080 Speaker 9: external foundry customers as our scale growth, and we also 96 00:04:54,160 --> 00:04:56,440 Speaker 9: get past this period where we had to invest to 97 00:04:56,560 --> 00:04:59,640 Speaker 9: catch up right and create the capacity for a decade 98 00:04:59,680 --> 00:05:03,120 Speaker 9: plus of under investment. So everything there becomes a tailwind 99 00:05:03,160 --> 00:05:06,279 Speaker 9: going forward. And we hit key milestones and one of 100 00:05:06,279 --> 00:05:08,400 Speaker 9: those I was very proud of just this week we 101 00:05:08,480 --> 00:05:11,919 Speaker 9: went to production with our first server part on Intel three. 102 00:05:12,360 --> 00:05:17,520 Speaker 9: The US is back to leadership process technology being manufactured 103 00:05:17,520 --> 00:05:19,080 Speaker 9: on our shores for the first. 104 00:05:18,920 --> 00:05:19,919 Speaker 7: Time in a decade. 105 00:05:20,080 --> 00:05:22,680 Speaker 9: So some key milestones, and I'll just say everything is 106 00:05:22,680 --> 00:05:25,839 Speaker 9: coming together as we would say, and we're very optimistic 107 00:05:25,880 --> 00:05:29,599 Speaker 9: that yes, in fact, we will deliver the foundry business 108 00:05:29,640 --> 00:05:33,080 Speaker 9: and the manufacturing capabilities as we've laid out for the company, 109 00:05:33,240 --> 00:05:36,040 Speaker 9: the industry, and the world Stiphil. 110 00:05:36,160 --> 00:05:37,599 Speaker 8: Interestingly, anais over there. 111 00:05:38,120 --> 00:05:41,240 Speaker 5: Twenty twenty four should mark the bottom in many aspects. 112 00:05:41,279 --> 00:05:42,320 Speaker 7: Pat but they. 113 00:05:42,200 --> 00:05:45,159 Speaker 5: Really want to understand the pace of the climb that 114 00:05:45,279 --> 00:05:49,520 Speaker 5: is necessary. How can you tell us about how quickly 115 00:05:49,560 --> 00:05:52,520 Speaker 5: you'll be able to scale that market share that. 116 00:05:52,480 --> 00:05:53,359 Speaker 8: You're so far lost. 117 00:05:54,120 --> 00:05:56,360 Speaker 9: Yeah, And you know, we look at Intel now in 118 00:05:56,440 --> 00:06:01,479 Speaker 9: these two different perspectives Intel products, and we expose through 119 00:06:01,520 --> 00:06:05,320 Speaker 9: our recast financials that we have a very solid, fabulous 120 00:06:05,400 --> 00:06:08,560 Speaker 9: business with healthy financials and we expect those to improve 121 00:06:08,600 --> 00:06:11,400 Speaker 9: over time. But the big story has been about exposing 122 00:06:11,440 --> 00:06:15,120 Speaker 9: the foundry financials and the losses associated with those. And 123 00:06:15,160 --> 00:06:17,599 Speaker 9: what we see is over the decade, you know that 124 00:06:17,640 --> 00:06:21,000 Speaker 9: we'll cross through profitability in the middle of the period 125 00:06:21,560 --> 00:06:24,520 Speaker 9: for that business as we get back to process leadership 126 00:06:24,839 --> 00:06:29,440 Speaker 9: and start to moderate the level of investment required to 127 00:06:29,480 --> 00:06:33,440 Speaker 9: go rebuild that decade of under investment. And as we 128 00:06:33,480 --> 00:06:36,320 Speaker 9: do that, if we would have that today, we'd be 129 00:06:36,400 --> 00:06:39,120 Speaker 9: more than double the earnings this year that we're forecasting. 130 00:06:39,200 --> 00:06:42,039 Speaker 9: So it becomes a huge positive lever for us. And 131 00:06:42,080 --> 00:06:44,200 Speaker 9: as I like to say, all of that's in our control, 132 00:06:45,080 --> 00:06:48,800 Speaker 9: the wafers, getting back to leadership, the product implications of it, 133 00:06:48,920 --> 00:06:50,960 Speaker 9: all of these things are our control, and it gets 134 00:06:51,040 --> 00:06:54,159 Speaker 9: better as we win additional external foundry customers. 135 00:06:55,560 --> 00:06:58,360 Speaker 6: The link I think pat is that is about growing 136 00:06:58,400 --> 00:07:02,880 Speaker 6: market share a server to support the costs necessary for 137 00:07:02,920 --> 00:07:06,680 Speaker 6: the foundry business. You're asked an interesting question on the 138 00:07:06,760 --> 00:07:11,080 Speaker 6: call in the context of servers built on x eighty 139 00:07:11,120 --> 00:07:15,200 Speaker 6: six versus on based alternatives, And you gave a pretty 140 00:07:15,200 --> 00:07:18,080 Speaker 6: thorough explanation about the place of all of those particular 141 00:07:18,200 --> 00:07:21,600 Speaker 6: data center CPUs. But what I didn't hear was what's 142 00:07:21,680 --> 00:07:24,400 Speaker 6: happening out there in the real world. Where are data 143 00:07:24,440 --> 00:07:26,600 Speaker 6: centers being built and what are they being built on 144 00:07:26,760 --> 00:07:27,239 Speaker 6: right now? 145 00:07:28,360 --> 00:07:30,440 Speaker 9: Yeah, and this is important because we've been at the 146 00:07:30,520 --> 00:07:33,840 Speaker 9: period now for a number of quarters where data centers 147 00:07:33,920 --> 00:07:38,280 Speaker 9: CPUs have been fairly tepid, and we do see that improving. 148 00:07:38,360 --> 00:07:41,240 Speaker 9: We had good improvement in the first quarter of the year, 149 00:07:41,280 --> 00:07:43,920 Speaker 9: and we expect that to continue through the year, and 150 00:07:44,000 --> 00:07:46,480 Speaker 9: you know, there's time for refrash in those data centers. 151 00:07:46,640 --> 00:07:47,920 Speaker 2: But we're also seeing that the. 152 00:07:47,920 --> 00:07:51,840 Speaker 9: CPUs now has head nodes for AI use cases. We've 153 00:07:51,880 --> 00:07:54,920 Speaker 9: posted some pretty incredible results that we can now run 154 00:07:55,080 --> 00:07:58,840 Speaker 9: seventy billion parameter models natively. 155 00:07:58,360 --> 00:07:59,080 Speaker 2: On the CPU. 156 00:07:59,240 --> 00:08:02,600 Speaker 9: I don't need accelerator. I can do everything on the 157 00:08:02,640 --> 00:08:06,280 Speaker 9: software stack that I already use inside of data centers. 158 00:08:06,680 --> 00:08:09,960 Speaker 9: And we're seeing that these power efficient products that we're 159 00:08:09,960 --> 00:08:13,200 Speaker 9: bringing to the marketplace, such as our Xeon six that 160 00:08:13,240 --> 00:08:16,600 Speaker 9: we just announced, are going to enable us to stabilize 161 00:08:16,640 --> 00:08:19,840 Speaker 9: and regain market share with much higher core counts. The 162 00:08:19,920 --> 00:08:23,360 Speaker 9: asps are going up very nicely on that through the year, 163 00:08:23,480 --> 00:08:25,880 Speaker 9: So we saw growth in Q one. We expect that 164 00:08:25,960 --> 00:08:28,640 Speaker 9: to continue through the year, and as we get to 165 00:08:28,680 --> 00:08:31,480 Speaker 9: the back half of the year, our Accelerator product line 166 00:08:31,520 --> 00:08:35,760 Speaker 9: with Goudy Xeon plus Goudy, we become, we believe, becomes 167 00:08:35,800 --> 00:08:39,319 Speaker 9: a very compelling solution for enterprise customers, and we have 168 00:08:39,440 --> 00:08:42,920 Speaker 9: quite a number of announcements of those this quarter. Customers 169 00:08:42,920 --> 00:08:49,560 Speaker 9: such as Bosh and Dell and super Micro all bringing 170 00:08:49,600 --> 00:08:54,160 Speaker 9: those into the marketplace, Roach and IBM, and eCloud partners 171 00:08:54,240 --> 00:08:58,080 Speaker 9: like Nahvor, the fastest growing cloud provider in Asia, all 172 00:08:58,120 --> 00:09:00,440 Speaker 9: of those coming alongside the Intel strategy. 173 00:09:00,520 --> 00:09:02,160 Speaker 7: So we see that momentum. 174 00:09:01,679 --> 00:09:04,920 Speaker 5: Building it momentum, and we want to just remind us 175 00:09:04,960 --> 00:09:08,760 Speaker 5: that we are with TV radio audiences. The CEO of Intel, 176 00:09:08,800 --> 00:09:12,319 Speaker 5: Pat Gelsinger, Pat on the momentum. Everyone wants to talk 177 00:09:12,320 --> 00:09:13,480 Speaker 5: about AI in all. 178 00:09:13,280 --> 00:09:14,600 Speaker 8: Of its ways and means. 179 00:09:14,640 --> 00:09:17,200 Speaker 5: You've been focusing in on an AIPC and I'm just 180 00:09:17,240 --> 00:09:20,360 Speaker 5: really interested in Ultimately you're going to be watch shipping 181 00:09:20,360 --> 00:09:24,920 Speaker 5: in excess. Originally forty million AIPC CPUs that's target for 182 00:09:24,960 --> 00:09:27,839 Speaker 5: twenty twenty four, But what's the demand like at the moment, 183 00:09:27,880 --> 00:09:29,080 Speaker 5: pat and what's the cost like. 184 00:09:30,120 --> 00:09:32,720 Speaker 9: Yeah, And when we announced the category at the end 185 00:09:32,760 --> 00:09:35,800 Speaker 9: of last year, Carolyn, it was sort of like everybody says, Wow, 186 00:09:35,840 --> 00:09:38,840 Speaker 9: what's going on the AIPC And you're seeing a flurry 187 00:09:39,080 --> 00:09:41,920 Speaker 9: of interest of other people coming into that market. But 188 00:09:42,080 --> 00:09:45,800 Speaker 9: Intel unquestionably the leader. You're first to declare the market, 189 00:09:45,840 --> 00:09:48,680 Speaker 9: first to describe the use cases. And our first product, 190 00:09:49,000 --> 00:09:53,480 Speaker 9: Core Ultra, is having a very robust ramp into the marketplace, 191 00:09:53,800 --> 00:09:56,840 Speaker 9: and to some degree, I'm racing the catch up to 192 00:09:56,880 --> 00:09:59,520 Speaker 9: the demand. We're meeting all of our supply commitments, but 193 00:09:59,559 --> 00:10:02,480 Speaker 9: not all of the upside requests yet that we're getting 194 00:10:02,480 --> 00:10:03,320 Speaker 9: from customers. 195 00:10:03,320 --> 00:10:04,680 Speaker 7: So this is very robust. 196 00:10:05,040 --> 00:10:08,640 Speaker 9: We expect that we'll exceed the forty million units this year. 197 00:10:08,920 --> 00:10:12,600 Speaker 9: We'll be introducing our next generation product in the middle 198 00:10:12,600 --> 00:10:14,920 Speaker 9: of this year, so all of these pieces, we are 199 00:10:15,040 --> 00:10:19,720 Speaker 9: very optimistic. And you're seeing use cases and communications where 200 00:10:20,000 --> 00:10:23,840 Speaker 9: all of a sudden, I get summarization, contextualization, translation in 201 00:10:23,920 --> 00:10:28,880 Speaker 9: real time, all running on my PC. Developers, gamers, all 202 00:10:28,920 --> 00:10:31,920 Speaker 9: of these use cases are now becoming AI Enabled and 203 00:10:32,040 --> 00:10:35,680 Speaker 9: Intel leading the AIPC parade. It's a very exciting time 204 00:10:35,960 --> 00:10:39,160 Speaker 9: for I believe will be the biggest cycle of PC 205 00:10:39,480 --> 00:10:42,600 Speaker 9: refrash and expansion that we've seen in likely decades. 206 00:10:43,160 --> 00:10:46,320 Speaker 5: Pat this is a conversation about your technology and about 207 00:10:46,440 --> 00:10:48,960 Speaker 5: ultimately your fundamentals of a business. I'm just going to 208 00:10:48,960 --> 00:10:51,760 Speaker 5: take a turn for a moment, and it's a sensitive question, 209 00:10:51,880 --> 00:10:52,880 Speaker 5: so I give you a moment to. 210 00:10:52,880 --> 00:10:53,480 Speaker 8: Think about it. 211 00:10:53,520 --> 00:10:55,800 Speaker 5: But giving your relationship with Israel and the fact that 212 00:10:55,800 --> 00:10:58,439 Speaker 5: you are one of the largest employers over there, how 213 00:10:58,480 --> 00:11:01,560 Speaker 5: are you currently feeling about Well, students in the United 214 00:11:01,559 --> 00:11:05,959 Speaker 5: States protesting against endowments being invested in companies that are 215 00:11:06,000 --> 00:11:07,400 Speaker 5: associated with Israel. 216 00:11:07,120 --> 00:11:07,679 Speaker 8: At this moment. 217 00:11:09,040 --> 00:11:13,119 Speaker 9: Well, we have been in Israel for forty years now 218 00:11:13,320 --> 00:11:18,720 Speaker 9: and it's been an incredible country for us, incredible innovators, 219 00:11:19,080 --> 00:11:24,800 Speaker 9: and extraordinary resilience by the Israeli people, and they continue, 220 00:11:25,120 --> 00:11:29,400 Speaker 9: despite the challenges of the war that's going on there, 221 00:11:29,559 --> 00:11:33,080 Speaker 9: to deliver against their objectives. So we're very committed to 222 00:11:33,120 --> 00:11:37,000 Speaker 9: support our teams wherever they are in the world that said, hey, 223 00:11:37,160 --> 00:11:42,240 Speaker 9: we seek peace, and we've been clearly emphasizing that we 224 00:11:42,600 --> 00:11:47,640 Speaker 9: need to find routes of sustainable peace in the region. 225 00:11:47,720 --> 00:11:52,040 Speaker 9: I've been supporting perspectives that reinforce that across the region, 226 00:11:52,480 --> 00:11:54,880 Speaker 9: and as we look across the world, we say, boy, 227 00:11:54,960 --> 00:11:57,439 Speaker 9: you know, there continues to be the turbulence. And fundamentally, 228 00:11:57,440 --> 00:12:01,760 Speaker 9: our strategy is around building globally rec zillient supply chains 229 00:12:01,760 --> 00:12:04,840 Speaker 9: that are balanced across the world. So our core strategy 230 00:12:04,920 --> 00:12:07,600 Speaker 9: is so emphasizing that there will be these challenges across 231 00:12:07,640 --> 00:12:11,119 Speaker 9: the world, you know, whether that's in Israel, Ukraine or Asia, 232 00:12:11,160 --> 00:12:13,240 Speaker 9: and we are committed to making sure that we can 233 00:12:13,320 --> 00:12:17,680 Speaker 9: support the global markets that we serve right with a 234 00:12:17,720 --> 00:12:20,559 Speaker 9: strategy that really was built for a turbulent world. 235 00:12:21,920 --> 00:12:25,360 Speaker 6: Pat let's end on AI accelerators. Goudi is on track 236 00:12:25,360 --> 00:12:28,719 Speaker 6: for five hundred million this year, AMD's MI I three 237 00:12:28,800 --> 00:12:31,080 Speaker 6: hundred X will probably do three and a half billion, 238 00:12:31,440 --> 00:12:35,480 Speaker 6: and Nvidia with its generations will do forty billion. You've 239 00:12:35,559 --> 00:12:39,800 Speaker 6: said that choice is important and also the CPU is important, 240 00:12:39,840 --> 00:12:42,320 Speaker 6: and I accept that many share it, but do you 241 00:12:42,440 --> 00:12:45,280 Speaker 6: see a clear path where the numbers I just outlined 242 00:12:45,360 --> 00:12:49,480 Speaker 6: rebalance in your favor in the AI accelerator market going forward. 243 00:12:50,880 --> 00:12:54,080 Speaker 9: Given the strength that we saw at our vision event 244 00:12:54,160 --> 00:12:56,959 Speaker 9: that we had, we had twenty plus customers coming out 245 00:12:57,040 --> 00:13:00,800 Speaker 9: publicly in support of our accelerator and our Z plus 246 00:13:00,840 --> 00:13:04,280 Speaker 9: accelerator strategy. We're really starting to see that pipeline of 247 00:13:04,520 --> 00:13:10,000 Speaker 9: activity convert and ultimately much of the activity that you've 248 00:13:10,040 --> 00:13:13,840 Speaker 9: seen so far on generative AI has been in cloud 249 00:13:14,160 --> 00:13:18,320 Speaker 9: training and now and I think the ultimate monetization of 250 00:13:18,480 --> 00:13:22,199 Speaker 9: AI happens as business deployments start to occur, and those 251 00:13:22,200 --> 00:13:24,360 Speaker 9: are the areas that we see strength. We launch the 252 00:13:24,720 --> 00:13:29,000 Speaker 9: open platform for Enterprise AI. How do we enable these 253 00:13:29,120 --> 00:13:32,439 Speaker 9: use cases inside of the enterprise, but in an open 254 00:13:32,559 --> 00:13:35,720 Speaker 9: architecture that many get to participate in. We announced the 255 00:13:35,840 --> 00:13:39,760 Speaker 9: open AI Networking, you know, from closed proprietary networking to 256 00:13:39,920 --> 00:13:43,640 Speaker 9: standard ethernet based scale up and scale out networking. We 257 00:13:43,679 --> 00:13:46,520 Speaker 9: announced that this quarter, and obviously the momentum that we're 258 00:13:46,520 --> 00:13:49,360 Speaker 9: seeing with Goudy, know, all of that half a billion, 259 00:13:49,360 --> 00:13:51,200 Speaker 9: almost all of it's in the second half of the year, 260 00:13:51,240 --> 00:13:54,400 Speaker 9: so you can see a very accelerated cycle, a lot 261 00:13:54,440 --> 00:13:58,520 Speaker 9: of enthusiasm for Goudy, you know, the unquestioned leader in 262 00:13:58,880 --> 00:14:02,720 Speaker 9: TCO total call the ownership for enterprises, building on the 263 00:14:02,800 --> 00:14:05,600 Speaker 9: Xeon franchise and the position that we have in the 264 00:14:05,760 --> 00:14:10,400 Speaker 9: enterprise and literally ISVs and cloud providers, but most importantly 265 00:14:10,720 --> 00:14:14,400 Speaker 9: enterprise customers seeing that value proposition. Yeah, we feel like 266 00:14:14,440 --> 00:14:17,400 Speaker 9: we're gaining a lot of momentum now in this category 267 00:14:17,440 --> 00:14:21,359 Speaker 9: and feel good about the potential for our AI everywhere AIPC, 268 00:14:21,600 --> 00:14:24,360 Speaker 9: AI Edge, AI Enterprise and AI cloud. 269 00:14:24,840 --> 00:14:27,160 Speaker 5: Ending on an optimistic mote, we thank you so much, 270 00:14:27,160 --> 00:14:30,600 Speaker 5: Intel CEO Pat Gelsinger there on all things AI, all 271 00:14:30,640 --> 00:14:40,360 Speaker 5: things Intel numbers. Got to get back to those earnings, 272 00:14:40,440 --> 00:14:42,760 Speaker 5: got to get back to the new two trillion dollar 273 00:14:43,080 --> 00:14:47,240 Speaker 5: entrant Google Microsoft two shares absolutely popping higher after the 274 00:14:47,320 --> 00:14:47,840 Speaker 5: surge and. 275 00:14:47,840 --> 00:14:49,680 Speaker 8: Cloud revenue those businesses. 276 00:14:49,440 --> 00:14:52,000 Speaker 5: And fueled in part, I guess what booming use of 277 00:14:52,080 --> 00:14:55,960 Speaker 5: artificial intelligence services is helping deliver strong earnings results and 278 00:14:55,960 --> 00:14:57,920 Speaker 5: we want to get to it with Clearbridge Investments Senior 279 00:14:57,920 --> 00:15:01,560 Speaker 5: research analyst Hillary Frish, who just comment on the one 280 00:15:01,560 --> 00:15:03,960 Speaker 5: that's moving the most today and alphabet. 281 00:15:03,680 --> 00:15:04,520 Speaker 8: Parent at Google. 282 00:15:05,040 --> 00:15:08,000 Speaker 5: Interestingly, cloud always been seen as the laggard there, but 283 00:15:08,360 --> 00:15:12,040 Speaker 5: infusing artificient intelligence is helping bring about market share, particularly 284 00:15:12,080 --> 00:15:12,680 Speaker 5: with startups. 285 00:15:12,920 --> 00:15:15,560 Speaker 10: Indeed, it is thanks for having me cure line. 286 00:15:15,800 --> 00:15:16,000 Speaker 3: Yeah. 287 00:15:16,080 --> 00:15:19,560 Speaker 10: Google is well known for having a strong presence among 288 00:15:19,960 --> 00:15:24,880 Speaker 10: startups tech companies and they have among the best AI 289 00:15:25,000 --> 00:15:28,640 Speaker 10: assets around historically, and so they're going to benefit from 290 00:15:28,640 --> 00:15:30,640 Speaker 10: this along with everybody else. And we've seen two quarters 291 00:15:30,640 --> 00:15:32,720 Speaker 10: of improvement at Google Cloud now, and. 292 00:15:32,640 --> 00:15:35,200 Speaker 5: I think many were waiting for Okay, you've got these offerings, 293 00:15:35,240 --> 00:15:37,800 Speaker 5: how are people using them, adopting them and actually boosting 294 00:15:37,800 --> 00:15:40,480 Speaker 5: their own productivity? Microsoft shone a light on the fact 295 00:15:40,520 --> 00:15:43,040 Speaker 5: that what is It's like sixty five percent of the 296 00:15:43,080 --> 00:15:46,640 Speaker 5: Fortune one hundred are using their Azure Cloud at the moment. 297 00:15:46,840 --> 00:15:49,000 Speaker 5: I mean, they must be just ripping away market share 298 00:15:49,040 --> 00:15:52,120 Speaker 5: from everyone else. Even though cloud is still good for Google, 299 00:15:52,480 --> 00:15:54,280 Speaker 5: Microsoft still firing on all the senators for you. 300 00:15:55,360 --> 00:15:57,760 Speaker 10: Indeed, it is, in fact, those cylinders are just really 301 00:15:57,800 --> 00:16:02,160 Speaker 10: starting to get going. It's interesting because Microsoft is absolutely 302 00:16:02,240 --> 00:16:05,560 Speaker 10: benefiting from a share perspective due to their leading position 303 00:16:05,640 --> 00:16:09,000 Speaker 10: in AI across all their businesses. Certainly cross cloud and 304 00:16:09,160 --> 00:16:12,600 Speaker 10: I view AI as ultimately, you know, an ultimate contributor, 305 00:16:12,640 --> 00:16:14,880 Speaker 10: but it's definitely an accelerant to cloud migrations. 306 00:16:16,080 --> 00:16:18,040 Speaker 7: Hillary, good morning, It's ed in San Francisco. 307 00:16:18,360 --> 00:16:21,840 Speaker 6: The share reactions of each are interesting, you know, alphabet 308 00:16:21,880 --> 00:16:24,360 Speaker 6: more pronounced when I talked to Ruth poor Out on 309 00:16:24,400 --> 00:16:26,440 Speaker 6: the phone last night, about cloud. 310 00:16:26,960 --> 00:16:28,280 Speaker 7: She basically said AI. 311 00:16:28,080 --> 00:16:31,640 Speaker 6: Solutions did make a meaningful contribution to that that twenty 312 00:16:31,680 --> 00:16:34,080 Speaker 6: eight percent cloud growth year on year, but she didn't 313 00:16:34,080 --> 00:16:36,920 Speaker 6: put a number on it. Now, Microsoft and amy Hood 314 00:16:36,920 --> 00:16:39,080 Speaker 6: did put a number on it. They said thirty one 315 00:16:39,080 --> 00:16:42,480 Speaker 6: percent asure growth, seven percent of which came from AI. 316 00:16:43,160 --> 00:16:45,560 Speaker 7: So really interesting share reaction. 317 00:16:45,760 --> 00:16:49,120 Speaker 6: I put it to you that Alphabet probably isn't jumping 318 00:16:49,160 --> 00:16:52,520 Speaker 6: as much on that cloud narrative as it is the 319 00:16:52,560 --> 00:16:54,280 Speaker 6: sweetener of a dividend. 320 00:16:55,640 --> 00:16:56,960 Speaker 8: I think you're right about that, Ed. 321 00:16:57,360 --> 00:17:00,720 Speaker 10: I think investors were pleased to see the results across 322 00:17:00,720 --> 00:17:01,120 Speaker 10: the board. 323 00:17:01,160 --> 00:17:02,200 Speaker 8: I think they breathe a. 324 00:17:02,160 --> 00:17:06,040 Speaker 10: Sigh of relief that cloud accelerated, that all businesses accelerated 325 00:17:06,160 --> 00:17:10,080 Speaker 10: quarter over quarter. But the big piece of new information 326 00:17:10,240 --> 00:17:14,520 Speaker 10: here was was operating margin improvement and commitment to that 327 00:17:14,640 --> 00:17:16,679 Speaker 10: through the year, as well as the dividend. And that 328 00:17:16,680 --> 00:17:18,840 Speaker 10: can draw a whole new class of users. But importantly, 329 00:17:18,880 --> 00:17:23,000 Speaker 10: it signals a shareholder friendlier stance than we've seen from 330 00:17:23,040 --> 00:17:24,080 Speaker 10: Google historically. 331 00:17:25,920 --> 00:17:29,640 Speaker 6: Hillary, do you believe now through the lens of Alphabet 332 00:17:29,680 --> 00:17:33,639 Speaker 6: and Microsoft earnings, that corporate America is actually spending on 333 00:17:33,720 --> 00:17:35,720 Speaker 6: and using generative AI. 334 00:17:37,080 --> 00:17:37,960 Speaker 8: I believe they are. 335 00:17:38,160 --> 00:17:42,800 Speaker 10: I believe most of corporate America is experimenting with AI 336 00:17:42,880 --> 00:17:46,800 Speaker 10: and testing generative AI, and in Microsoft's are cloud and elsewhere, 337 00:17:46,800 --> 00:17:50,240 Speaker 10: certainly in Amazon and Google as well, there are some 338 00:17:50,480 --> 00:17:52,960 Speaker 10: early adopters who are starting to get to some level 339 00:17:53,000 --> 00:17:57,760 Speaker 10: of scale. Microsoft seven points of AI contribution were good. 340 00:17:57,960 --> 00:17:59,760 Speaker 10: I would say they were generally in line, though, but 341 00:17:59,840 --> 00:18:02,119 Speaker 10: Mycrosoft did signal on their call that they were actually 342 00:18:02,160 --> 00:18:05,160 Speaker 10: a capacity constrained, alluding to the idea that that number 343 00:18:05,200 --> 00:18:07,920 Speaker 10: would have actually been higher were it not for those constraints. 344 00:18:08,880 --> 00:18:11,600 Speaker 10: I still believe it's going to be starting in the 345 00:18:11,640 --> 00:18:14,879 Speaker 10: second half where we see that Microsoft inferencing base of 346 00:18:15,040 --> 00:18:18,640 Speaker 10: users doing inferencing on their Azure Cloud really broaden out 347 00:18:18,720 --> 00:18:20,399 Speaker 10: and start to drive that number. 348 00:18:20,840 --> 00:18:23,679 Speaker 5: I want to dig into basically the broadening idea. 349 00:18:23,720 --> 00:18:25,480 Speaker 8: Here we're talking about two names. 350 00:18:25,240 --> 00:18:28,000 Speaker 5: That have already done phenomenally well on the hype around AI. 351 00:18:28,440 --> 00:18:31,160 Speaker 5: We're waiting for the spin over effects. Now you shine 352 00:18:31,160 --> 00:18:32,800 Speaker 5: a light on certain companies that I keep an eye 353 00:18:32,800 --> 00:18:34,560 Speaker 5: on because they're New York based Mongo dB. 354 00:18:34,920 --> 00:18:36,879 Speaker 8: We also think about what data dog is up to. 355 00:18:37,280 --> 00:18:39,520 Speaker 5: How are these companies going to benefit from the adoption 356 00:18:39,560 --> 00:18:40,399 Speaker 5: of jener to AI. 357 00:18:40,800 --> 00:18:44,160 Speaker 10: So these companies will benefit the whole consumption complex, Cloud 358 00:18:44,200 --> 00:18:47,520 Speaker 10: Consumption Complex, Mango, dB Snowflake, Data Dog, the. 359 00:18:49,320 --> 00:18:50,520 Speaker 8: First and third being in New York. 360 00:18:50,640 --> 00:18:54,639 Speaker 10: They'll benefit with a lag what they will. So I 361 00:18:54,680 --> 00:18:56,879 Speaker 10: agree with your Caroline that we're not seeing it on 362 00:18:56,920 --> 00:19:00,119 Speaker 10: a broad based basis yet there are select few who 363 00:19:00,160 --> 00:19:02,120 Speaker 10: are actually going to benefit. But what they will benefit 364 00:19:02,200 --> 00:19:05,800 Speaker 10: from is the absence of the extreme cost optimization we 365 00:19:05,840 --> 00:19:08,960 Speaker 10: saw last year, companies going on a buyer strike in 366 00:19:09,040 --> 00:19:11,359 Speaker 10: terms of new projects. They're going to see the flow 367 00:19:11,440 --> 00:19:15,560 Speaker 10: through of what's effectively a cyclical upturn in cloud consumption. 368 00:19:15,600 --> 00:19:18,119 Speaker 10: And we actually heard that from Microsoft last night that 369 00:19:18,200 --> 00:19:21,680 Speaker 10: companies are commencing new projects, that they're starting to do things, 370 00:19:21,680 --> 00:19:25,439 Speaker 10: they're taking out mothballed projects and bringing those back. So 371 00:19:25,520 --> 00:19:27,200 Speaker 10: I think that's a positive for this whole group. 372 00:19:28,560 --> 00:19:32,080 Speaker 6: Hillary, we're down week one of megacap Tech and I'm 373 00:19:32,080 --> 00:19:35,439 Speaker 6: bracing for week two. What do you think is the 374 00:19:35,480 --> 00:19:39,240 Speaker 6: kind of blanket takeaway of this seven day period so far? 375 00:19:40,520 --> 00:19:46,439 Speaker 10: I'd say overall cautiously optimistic. Again, I stick to the 376 00:19:46,520 --> 00:19:53,400 Speaker 10: names where expectations are low, valuations are reasonable, and companies 377 00:19:53,440 --> 00:19:57,719 Speaker 10: have idiosyncratic drivers. Microsoft with AI and share gains the 378 00:19:57,720 --> 00:20:02,080 Speaker 10: cloud consumption complex with the A and some negatives. Amazon 379 00:20:02,119 --> 00:20:05,360 Speaker 10: should show some pretty good results based on the fact 380 00:20:05,400 --> 00:20:07,720 Speaker 10: that they have a lot of tech companies and startups 381 00:20:07,760 --> 00:20:10,040 Speaker 10: on their platform too who are experimenting with AI. But 382 00:20:10,320 --> 00:20:14,320 Speaker 10: it's really company by company and enterprise budgets overall remain 383 00:20:14,680 --> 00:20:17,920 Speaker 10: somewhat constrained in first half. I'd experience more of that 384 00:20:18,000 --> 00:20:19,120 Speaker 10: opening up in second half. 385 00:20:19,680 --> 00:20:20,679 Speaker 8: Lud Fresh all is. 386 00:20:20,680 --> 00:20:22,960 Speaker 5: So good to get your expertise on the time that 387 00:20:23,000 --> 00:20:25,720 Speaker 5: we have earnings and all the time actually clearbridge investments. 388 00:20:25,800 --> 00:20:27,480 Speaker 8: We thank you for being here and what have you got. 389 00:20:28,240 --> 00:20:30,399 Speaker 6: Let's get some news in talking tech and first up 390 00:20:30,400 --> 00:20:33,920 Speaker 6: food delivery service Metwan is planning to launch its international 391 00:20:33,920 --> 00:20:38,000 Speaker 6: platform in Reard, its first location outside of China, according 392 00:20:38,040 --> 00:20:41,560 Speaker 6: to sources involved in discussions. The companies looked into expanding 393 00:20:41,840 --> 00:20:44,280 Speaker 6: in the Middle East for months and could launch as 394 00:20:44,320 --> 00:20:46,800 Speaker 6: early as a few months from now. The move comes 395 00:20:46,920 --> 00:20:51,840 Speaker 6: as Chinese companies seek growth abroad to combat a domestic slowdown. Plus, 396 00:20:52,080 --> 00:20:55,400 Speaker 6: US Secretary of State Anthony Blincoln and Chinese President Jijingping 397 00:20:55,840 --> 00:20:59,480 Speaker 6: met in Beijing. She's China. She issued a warning to 398 00:20:59,480 --> 00:21:03,400 Speaker 6: blink in against quote vicious competition between the two countries, 399 00:21:03,440 --> 00:21:06,240 Speaker 6: saying quote, China and the United States should. 400 00:21:05,960 --> 00:21:07,800 Speaker 7: Be partners rather than rivals. 401 00:21:07,800 --> 00:21:11,920 Speaker 6: The two day meeting composed the dialogue on trade, geopolitical tensions, 402 00:21:11,920 --> 00:21:15,040 Speaker 6: and even an announcement of AI talks that will begin 403 00:21:15,119 --> 00:21:18,520 Speaker 6: in the coming weeks. And finally, Huawei's latest smartphones are 404 00:21:18,520 --> 00:21:21,320 Speaker 6: said to be utilizing an updated version of its made 405 00:21:21,359 --> 00:21:24,920 Speaker 6: in China chips. According to an independent analysis, the purest 406 00:21:24,960 --> 00:21:28,640 Speaker 6: seventy phones sport a kirre In ninety ten processor, which 407 00:21:28,680 --> 00:21:31,000 Speaker 6: is a new version of the nine thousand chips that 408 00:21:31,119 --> 00:21:35,040 Speaker 6: alarmed Washington officials due to their seven nanimeter tech, long 409 00:21:35,080 --> 00:21:38,760 Speaker 6: thought to be beyond China's capabilities. According to Jeffreys, the 410 00:21:38,800 --> 00:21:43,359 Speaker 6: Pure seventy smartphones sold out within two days of being launched. 411 00:21:43,440 --> 00:21:45,160 Speaker 8: Carol, fascinating. 412 00:21:45,480 --> 00:21:49,199 Speaker 5: Coming up, Look, we're going to talk FTC allegations against 413 00:21:49,200 --> 00:21:53,280 Speaker 5: the Amazon founder Jeff Bezos and it's currency Leo Andy Jesse. Apparently, 414 00:21:53,560 --> 00:21:56,040 Speaker 5: according to the FDC, they've been destroying messages amid an 415 00:21:56,040 --> 00:21:58,880 Speaker 5: antitrust probe. We'll get you the details and the response 416 00:21:58,920 --> 00:22:01,520 Speaker 5: from Amazon next you more just of course happening with 417 00:22:01,600 --> 00:22:05,000 Speaker 5: dark Trace today, UK listed company up sixteen percent. Why 418 00:22:05,359 --> 00:22:07,720 Speaker 5: the UK cyber Companies actually agreed to sell itself to 419 00:22:07,760 --> 00:22:10,480 Speaker 5: a private equity firm Tomo Bravo for an equity. 420 00:22:10,240 --> 00:22:12,000 Speaker 8: Value of five point three billion dollars. 421 00:22:12,040 --> 00:22:14,320 Speaker 5: That's basically a twenty percent premium. So still a little 422 00:22:14,320 --> 00:22:15,960 Speaker 5: bit of caution in the market that this deal will 423 00:22:16,000 --> 00:22:18,680 Speaker 5: get done. Remember tom O Bravo actually walked away back 424 00:22:18,680 --> 00:22:21,040 Speaker 5: in twenty twenty two for talks to buy dark Trace. 425 00:22:21,119 --> 00:22:23,399 Speaker 5: But really interesting and this is a company, of course 426 00:22:23,680 --> 00:22:27,440 Speaker 5: in somewhat an interesting relationship with the battle British entrepreneur 427 00:22:27,480 --> 00:22:29,879 Speaker 5: Mike Lynch who is on trial for Ford. Here in 428 00:22:29,960 --> 00:22:32,520 Speaker 5: the US, we shine a light on dark Trace today. 429 00:22:32,560 --> 00:22:43,360 Speaker 5: This is Broome, their technology. 430 00:22:45,440 --> 00:22:48,520 Speaker 6: Welcome back to Bloomberg Technology. Ed Ludlow in San Francisco. 431 00:22:48,680 --> 00:22:49,920 Speaker 8: Aaron Hyed back in New York. 432 00:22:50,240 --> 00:22:52,000 Speaker 6: Let's get to one of the top stories on the 433 00:22:52,000 --> 00:22:56,439 Speaker 6: Bloomberg terminal and dot com. Top Amazon executives, including founder 434 00:22:56,480 --> 00:23:01,520 Speaker 6: Jeff Bezos and CEO Andy Jesse destroy Lloyd's text messages 435 00:23:01,640 --> 00:23:06,399 Speaker 6: discussing business, according to allegations by the FTC, A raising 436 00:23:06,520 --> 00:23:10,080 Speaker 6: evidence the agency could have used in an antitrust case 437 00:23:10,240 --> 00:23:12,359 Speaker 6: against the retail giant. I want to bring in Bloomberg's 438 00:23:12,359 --> 00:23:15,320 Speaker 6: Mike Shepherd, who leads our coverage of the kind of 439 00:23:15,320 --> 00:23:21,600 Speaker 6: intersection of tech and politics. Now, Amazon is pushing back 440 00:23:21,640 --> 00:23:25,000 Speaker 6: against this FTC allegation with some force. We will get 441 00:23:25,000 --> 00:23:28,679 Speaker 6: to that, but we're talking about communications made by executives 442 00:23:28,680 --> 00:23:33,119 Speaker 6: on the Signal app. Mike explain it to us, well, I. 443 00:23:33,119 --> 00:23:35,639 Speaker 3: Think it's important to turn the clock back a couple 444 00:23:35,640 --> 00:23:38,480 Speaker 3: of months to September, and this is when the FTC 445 00:23:38,600 --> 00:23:43,400 Speaker 3: filed its initial anti trust case against Amazon, and they've 446 00:23:43,440 --> 00:23:47,000 Speaker 3: gradually been increasing the pressure on the company in this 447 00:23:47,119 --> 00:23:49,080 Speaker 3: particular matter, in this lawsuit. 448 00:23:49,359 --> 00:23:51,240 Speaker 7: In November, they had. 449 00:23:51,520 --> 00:23:55,000 Speaker 3: A less redactive version of the case released to the public, 450 00:23:55,240 --> 00:23:58,600 Speaker 3: and that indicated that they had concerns executives have been 451 00:23:58,640 --> 00:24:01,760 Speaker 3: concealing some information, but they didn't name names. 452 00:24:02,160 --> 00:24:02,640 Speaker 7: Today. 453 00:24:03,160 --> 00:24:06,679 Speaker 3: We learned last night we're discussing today the latest and 454 00:24:06,720 --> 00:24:09,600 Speaker 3: that is that they are naming names, including CEO Andy 455 00:24:09,680 --> 00:24:13,359 Speaker 3: Jase and the founder of Jeff Bezos. And that indicates 456 00:24:13,359 --> 00:24:16,760 Speaker 3: the kind of pressure that the agency is putting on 457 00:24:16,880 --> 00:24:21,600 Speaker 3: the company, and it echoes what this broader effort against 458 00:24:21,600 --> 00:24:24,520 Speaker 3: big tech by anti trust and forces here in DC. 459 00:24:25,040 --> 00:24:27,760 Speaker 5: Mike, turn the clock back even further, and you go 460 00:24:27,840 --> 00:24:31,520 Speaker 5: to twenty nineteen, when Jeff Bezos indeed made clear and 461 00:24:31,560 --> 00:24:34,160 Speaker 5: evident that his phone had been hacked, he felt and 462 00:24:34,359 --> 00:24:37,000 Speaker 5: that is the argument as to why executives moved to 463 00:24:37,680 --> 00:24:42,240 Speaker 5: signal and these automatic discussions that can delete themselves. 464 00:24:42,320 --> 00:24:43,960 Speaker 8: And I'm noting. 465 00:24:43,600 --> 00:24:46,359 Speaker 5: That Amazon has currently said, Look, the FDC has a 466 00:24:46,359 --> 00:24:48,960 Speaker 5: complete picture of Amazon's decision making in this case, including 467 00:24:49,119 --> 00:24:52,320 Speaker 5: one point seven million documents from sources like email, internal 468 00:24:52,320 --> 00:24:55,720 Speaker 5: messaging applications, and laptops, among other sources, over. 469 00:24:55,600 --> 00:24:57,560 Speaker 8: One hundred terabytes of data. 470 00:24:58,119 --> 00:25:01,520 Speaker 5: What more needed they do to prove that they weren't 471 00:25:01,600 --> 00:25:05,080 Speaker 5: using signal for well, conversations they didn't want seen by 472 00:25:05,080 --> 00:25:05,680 Speaker 5: the FTC. 473 00:25:07,040 --> 00:25:11,360 Speaker 3: Well, you know, the FTC is actually alleging that maybe 474 00:25:11,400 --> 00:25:14,360 Speaker 3: there was more that they needed to know about. 475 00:25:14,680 --> 00:25:16,120 Speaker 2: Maybe there was more in. 476 00:25:16,080 --> 00:25:20,479 Speaker 3: Those conversations that disappeared that they don't have access to 477 00:25:20,720 --> 00:25:22,800 Speaker 3: and are not privy to in the case yet, and 478 00:25:22,880 --> 00:25:26,280 Speaker 3: that they should therefore be able to see to have 479 00:25:26,440 --> 00:25:30,159 Speaker 3: a clear and complete picture. But Amazon is saying that, look, 480 00:25:30,240 --> 00:25:33,120 Speaker 3: you already have enough, You have more than enough. Then 481 00:25:33,520 --> 00:25:36,240 Speaker 3: you need to be able to carry on your work here. 482 00:25:36,520 --> 00:25:38,959 Speaker 3: And I'm glad you brought up, Caroline, the point about 483 00:25:39,000 --> 00:25:43,800 Speaker 3: twenty nineteen, because of course that's when Jeff Bezos's texts 484 00:25:43,880 --> 00:25:49,159 Speaker 3: were purportedly hacked, and his desire to maintain some degree 485 00:25:49,160 --> 00:25:53,200 Speaker 3: of privacy is another driver here, and so the company 486 00:25:53,280 --> 00:25:56,080 Speaker 3: is saying, look, we've done enough, and also we had 487 00:25:56,240 --> 00:25:59,639 Speaker 3: cause to try to protect some of these communications against 488 00:25:59,680 --> 00:26:01,000 Speaker 3: people on the outside. 489 00:26:01,560 --> 00:26:03,760 Speaker 5: Mike Shepherd, you always sum it up so beautifully, Thank 490 00:26:03,760 --> 00:26:06,880 Speaker 5: you very much. Indeed, of all things FTC and Amazon. 491 00:26:06,880 --> 00:26:07,160 Speaker 7: Today. 492 00:26:07,200 --> 00:26:10,240 Speaker 8: Meanwhile, a shift gears a little bit. Elon Musk's artificial 493 00:26:10,240 --> 00:26:11,520 Speaker 8: intelligence startup. 494 00:26:11,240 --> 00:26:13,920 Speaker 5: Xai parently is nearing a deal to raise six billion 495 00:26:13,960 --> 00:26:16,239 Speaker 5: dollars in funding, and that would value the company at 496 00:26:16,280 --> 00:26:18,959 Speaker 5: eighteen billion. It's all according to a person familiar when 497 00:26:18,960 --> 00:26:21,920 Speaker 5: the matter. Bluembg's Max Chafkin all in on Elon Inc. 498 00:26:22,080 --> 00:26:24,760 Speaker 5: Joins us now, and I'm interested by the fact that 499 00:26:24,800 --> 00:26:27,560 Speaker 5: this year at mount they're raising versus the capitalization of 500 00:26:27,600 --> 00:26:29,679 Speaker 5: the business. But we did know they were going for 501 00:26:29,720 --> 00:26:31,160 Speaker 5: funding to beef up XAI. 502 00:26:31,800 --> 00:26:32,640 Speaker 4: Well, here's the thing. 503 00:26:33,240 --> 00:26:36,160 Speaker 11: Elon Musk was able to kind of spin this open 504 00:26:36,160 --> 00:26:39,800 Speaker 11: ai competitor. This is this company basically it makes large 505 00:26:39,880 --> 00:26:42,199 Speaker 11: language models very similar to open ai. 506 00:26:42,359 --> 00:26:44,680 Speaker 4: He did this kind of quickly and with a very 507 00:26:44,680 --> 00:26:45,320 Speaker 4: small staff. 508 00:26:45,320 --> 00:26:48,119 Speaker 11: But the thing is to keep these models training, you 509 00:26:48,200 --> 00:26:52,080 Speaker 11: need an insane number of very very expensive GPUs. 510 00:26:52,119 --> 00:26:55,280 Speaker 4: These are the graphics chips that artificial intelligence companies use. 511 00:26:55,520 --> 00:27:00,240 Speaker 11: Elon Musk on a x spaces interview last month's said 512 00:27:00,280 --> 00:27:03,919 Speaker 11: that they were using twenty thousand already of these Nvidia 513 00:27:03,960 --> 00:27:06,280 Speaker 11: each one hundreds. They would need one hundred thousand of 514 00:27:06,359 --> 00:27:09,120 Speaker 11: these chips. So this is you know, that's an expense 515 00:27:09,160 --> 00:27:11,840 Speaker 11: that's in the hundreds of millions of dollars, if not 516 00:27:11,960 --> 00:27:13,040 Speaker 11: the billions of dollars. 517 00:27:13,040 --> 00:27:15,480 Speaker 4: So that's why he's raising this money and why they 518 00:27:15,520 --> 00:27:15,879 Speaker 4: need it. 519 00:27:17,040 --> 00:27:19,680 Speaker 6: There is a little backstory of all of this that 520 00:27:19,960 --> 00:27:22,560 Speaker 6: the Zett, Chapman and I have. Bloomberg News reported on 521 00:27:22,640 --> 00:27:26,719 Speaker 6: January nineteenth that Xai was in talks to raise funds 522 00:27:26,720 --> 00:27:30,879 Speaker 6: at evaluation between fifteen and twenty billion dollars. Eighteen billion 523 00:27:30,960 --> 00:27:34,440 Speaker 6: is pretty much between fifteen and twenty billion, and Elon. 524 00:27:34,240 --> 00:27:34,800 Speaker 7: Must denied it. 525 00:27:34,880 --> 00:27:37,639 Speaker 6: He said false, fake, and then the ft followed up 526 00:27:37,640 --> 00:27:39,719 Speaker 6: with the same report and he said fake. And then 527 00:27:39,760 --> 00:27:42,480 Speaker 6: the information came out yesterday with the report which Bloomberg 528 00:27:42,520 --> 00:27:45,399 Speaker 6: then reported too, And he hasn't said anything yet. The 529 00:27:45,480 --> 00:27:48,600 Speaker 6: main thing is irrespective of what Elon Musk says. He's 530 00:27:48,600 --> 00:27:51,880 Speaker 6: got an edibility to raise money for pretty much any 531 00:27:51,920 --> 00:27:53,800 Speaker 6: project he's doing max well. 532 00:27:53,960 --> 00:27:56,000 Speaker 11: And it's not that he only has an ability, but 533 00:27:56,080 --> 00:27:58,640 Speaker 11: he has to raise money here because you know, Elon Musk, 534 00:27:58,680 --> 00:28:01,600 Speaker 11: as many people know, is you know, very wealthy, right, 535 00:28:01,640 --> 00:28:04,919 Speaker 11: but he is not very liquid. Most of his wealth 536 00:28:05,160 --> 00:28:09,040 Speaker 11: is tied up in Tesla stock, SpaceX stock. He does 537 00:28:09,080 --> 00:28:11,920 Speaker 11: not have billions of dollars. He spent a lot of 538 00:28:11,920 --> 00:28:13,959 Speaker 11: money to buy Twitter turn it into x. He does 539 00:28:14,000 --> 00:28:17,280 Speaker 11: not have billions of dollars rattling around his pocket without 540 00:28:17,320 --> 00:28:20,600 Speaker 11: selling some assets, which would you know, create some disruption 541 00:28:20,680 --> 00:28:23,840 Speaker 11: within his empire. So he needs this outside money if 542 00:28:23,880 --> 00:28:26,480 Speaker 11: he has any prayer of sort of catching up to 543 00:28:26,520 --> 00:28:28,880 Speaker 11: open Ai. And from the point of view of investors, 544 00:28:28,880 --> 00:28:30,600 Speaker 11: you can see why they're happy to give it to him, 545 00:28:30,640 --> 00:28:33,080 Speaker 11: because Open Ai anthropic. 546 00:28:33,119 --> 00:28:35,080 Speaker 4: These companies, you know, there are some. 547 00:28:35,080 --> 00:28:37,320 Speaker 11: Real questions about the business models, but they have been 548 00:28:37,359 --> 00:28:40,600 Speaker 11: able to achieve huge valuations, a lot of adoption. You know, 549 00:28:40,880 --> 00:28:44,280 Speaker 11: taking a flyer on Elon Musk and the hottest category 550 00:28:44,320 --> 00:28:46,560 Speaker 11: in business makes a lot of sense if you're these 551 00:28:46,640 --> 00:28:48,280 Speaker 11: venture capitalists who are considering this. 552 00:28:48,280 --> 00:28:51,200 Speaker 6: Deal, and to his credit, a lot of these projects 553 00:28:51,240 --> 00:28:53,720 Speaker 6: then do tend out to be influential, and it's a 554 00:28:53,800 --> 00:28:56,200 Speaker 6: lean team at XAI, and it looks like they're making 555 00:28:56,240 --> 00:28:58,920 Speaker 6: progress doing best match Taffick and Happy Friday to you. 556 00:28:59,280 --> 00:29:01,120 Speaker 6: A quick news story that we're looking at shares of 557 00:29:01,160 --> 00:29:03,840 Speaker 6: IBM a little lower down a percentage point, but they're 558 00:29:03,880 --> 00:29:07,440 Speaker 6: backing a project in Canada seven hundred and thirty million 559 00:29:07,560 --> 00:29:11,640 Speaker 6: US dollars one billion Canadian dollars. This is for semiconductors, 560 00:29:11,640 --> 00:29:13,760 Speaker 6: but in the context of what IBM is involved in, 561 00:29:13,800 --> 00:29:17,640 Speaker 6: which is packaging and also testing labs, it's. 562 00:29:17,560 --> 00:29:18,640 Speaker 7: An interesting bet. 563 00:29:18,640 --> 00:29:22,480 Speaker 6: We haven't really talked as much about Canada in the 564 00:29:22,520 --> 00:29:25,040 Speaker 6: context of, well, are they going to be on shoring 565 00:29:25,120 --> 00:29:27,960 Speaker 6: making some kind of domestic effort when it comes to 566 00:29:27,960 --> 00:29:30,960 Speaker 6: semi conductors like the United States are, Well, IBM's doing 567 00:29:31,000 --> 00:29:33,840 Speaker 6: something to the tune seven hundred and thirty million dollars. 568 00:29:34,320 --> 00:29:36,360 Speaker 7: We will be right back. This has Bienbo Technology. 569 00:29:51,440 --> 00:29:56,280 Speaker 5: Cybersecurity firm Rubric remember jumped yesterday on its IPO day. 570 00:29:56,240 --> 00:29:58,400 Speaker 8: And well it's holding on to its gains. 571 00:29:58,760 --> 00:30:02,360 Speaker 5: Remember it about seven hundred and thirty two million dollars on. 572 00:30:02,320 --> 00:30:03,160 Speaker 8: The back of that IPO. 573 00:30:03,480 --> 00:30:05,520 Speaker 5: One of the key backers long term backers was gray 574 00:30:05,520 --> 00:30:07,360 Speaker 5: Lock PRIP please to say that we have grey. 575 00:30:07,200 --> 00:30:09,600 Speaker 8: Lock partner asheme Chanda with us and. 576 00:30:09,760 --> 00:30:13,280 Speaker 5: Ashme you there stock exchange, ringing the bells, celebrating and 577 00:30:14,320 --> 00:30:18,000 Speaker 5: how does it feel ultimately to see an early payoff 578 00:30:18,040 --> 00:30:20,480 Speaker 5: like that? What was the signals that you got early 579 00:30:20,560 --> 00:30:22,560 Speaker 5: on to know that will go public. 580 00:30:22,280 --> 00:30:23,160 Speaker 8: And do so so well? 581 00:30:23,640 --> 00:30:26,160 Speaker 12: Yeah, so now thanks so much for having me. You know, 582 00:30:26,200 --> 00:30:28,480 Speaker 12: the hounderstand sor of when you back a company very early, 583 00:30:28,520 --> 00:30:31,440 Speaker 12: you don't really fully know what lies ahead. I'd say 584 00:30:31,440 --> 00:30:34,080 Speaker 12: this is this company is really a story of an 585 00:30:34,120 --> 00:30:39,240 Speaker 12: exceptional leadership team, exceptional leader targeting a very very large market. 586 00:30:39,520 --> 00:30:42,680 Speaker 12: So I think early on in the company's history it 587 00:30:42,840 --> 00:30:44,960 Speaker 12: was very clear like the size of the markets that 588 00:30:45,000 --> 00:30:47,400 Speaker 12: they were targeting, you know, our market sizes that most 589 00:30:47,400 --> 00:30:49,280 Speaker 12: companies don't really go after, and then the quality of 590 00:30:49,280 --> 00:30:49,640 Speaker 12: the people. 591 00:30:49,760 --> 00:30:51,200 Speaker 7: Yeah. 592 00:30:51,240 --> 00:30:54,680 Speaker 5: And I think what's interesting more broadly about the direction 593 00:30:54,760 --> 00:30:57,840 Speaker 5: of travel with Rubric is that vantage they popped, they've increased, 594 00:30:58,080 --> 00:31:00,760 Speaker 5: but also that there are other cybersecurity companies I'm sure 595 00:31:00,760 --> 00:31:03,200 Speaker 5: in your portfolio eyeing the market, but there's also the 596 00:31:03,240 --> 00:31:05,160 Speaker 5: juggernaut that is Microsoft. And the same day that they 597 00:31:05,200 --> 00:31:07,760 Speaker 5: went public, Microsoft came out with its earnings saying, look, 598 00:31:07,760 --> 00:31:11,040 Speaker 5: we're still making strides in cybersecurity, all interlaced with generator 599 00:31:11,040 --> 00:31:13,200 Speaker 5: of AI. How much room is that for this sort 600 00:31:13,200 --> 00:31:14,520 Speaker 5: of element of competition. 601 00:31:15,080 --> 00:31:19,200 Speaker 12: Yeah, I would say, you know, so cybersecurity is a 602 00:31:19,440 --> 00:31:23,120 Speaker 12: you know, is a secular kind of growing market. These markets, 603 00:31:23,200 --> 00:31:25,480 Speaker 12: you know, have become very, very large and today, you know, 604 00:31:25,520 --> 00:31:27,760 Speaker 12: it's one of the most important parts of intermission technology. 605 00:31:28,120 --> 00:31:30,640 Speaker 12: Most large and mid sized companies spend anywhere from five 606 00:31:30,640 --> 00:31:33,680 Speaker 12: to ten percent of the IT budget on cyber and 607 00:31:33,760 --> 00:31:36,280 Speaker 12: so there's a lot of room for multiple providers, you know, 608 00:31:36,400 --> 00:31:40,080 Speaker 12: provide different pieces of the stack. And then and then 609 00:31:40,600 --> 00:31:42,800 Speaker 12: and then Rubric is an important partner with you know, 610 00:31:42,880 --> 00:31:45,360 Speaker 12: Rubrick and Microsoft have a strong partnership together. 611 00:31:46,880 --> 00:31:51,200 Speaker 6: Ashan, I'm really really interested in Rubik's very close relationship 612 00:31:51,200 --> 00:31:55,040 Speaker 6: with Microsoft. There's a financial element to it. But given 613 00:31:55,160 --> 00:31:58,880 Speaker 6: how AI in all of its guys is playing out, 614 00:31:59,160 --> 00:32:01,400 Speaker 6: I just wondered if you had a particular thesis on 615 00:32:01,480 --> 00:32:03,160 Speaker 6: how that relationship continues. 616 00:32:03,840 --> 00:32:05,600 Speaker 12: Yeah, I would say, it's it's, it's it's it's a 617 00:32:05,640 --> 00:32:10,160 Speaker 12: multifaceted relationship, but fundamentally you know, what what Microsoft and 618 00:32:10,240 --> 00:32:12,480 Speaker 12: Rubric are trying to do is really provide customers with 619 00:32:12,520 --> 00:32:16,520 Speaker 12: cyber resilience, so, you know, and just bring different pieces together. 620 00:32:18,080 --> 00:32:19,960 Speaker 7: So what's next? A gray lot? 621 00:32:20,200 --> 00:32:24,600 Speaker 6: I mean, you have a lot going on, you would claim, 622 00:32:24,640 --> 00:32:27,080 Speaker 6: I think, and and many of your colleagues who said 623 00:32:27,080 --> 00:32:30,080 Speaker 6: on this show that you guys early on generative AI 624 00:32:30,280 --> 00:32:34,240 Speaker 6: and organized on generative AI, wondered if you've kind of 625 00:32:34,280 --> 00:32:36,840 Speaker 6: sharpened your focus on any other areas in particular. 626 00:32:37,920 --> 00:32:39,360 Speaker 12: Yeah, I would say, you know, so I've been a 627 00:32:39,400 --> 00:32:42,560 Speaker 12: greylock now just a little over two decades. It's never 628 00:32:42,600 --> 00:32:44,680 Speaker 12: been a more exciting time to be in venture capital, 629 00:32:45,400 --> 00:32:47,480 Speaker 12: just with everything going on with Jene AI. You know, 630 00:32:47,560 --> 00:32:49,760 Speaker 12: the I'd say that, I'd say the average day in 631 00:32:50,080 --> 00:32:52,280 Speaker 12: the life of a VC has it's really become an 632 00:32:52,280 --> 00:32:54,800 Speaker 12: AI job. And you know, we think of it fundamentally 633 00:32:54,840 --> 00:32:57,240 Speaker 12: at three layers, kind of the foundational layer at the 634 00:32:57,240 --> 00:33:01,360 Speaker 12: lowest level, enabling infrastructure in the middle, and then applications 635 00:33:01,400 --> 00:33:04,280 Speaker 12: at the top. And you know, it's say, in particular 636 00:33:04,440 --> 00:33:07,520 Speaker 12: for VC backed startups, there's a lot of opportunity around 637 00:33:07,680 --> 00:33:11,720 Speaker 12: enabling infrastructure and also in applications. You know, I think 638 00:33:11,760 --> 00:33:14,200 Speaker 12: it's a safe statement to say that over the coming 639 00:33:14,200 --> 00:33:16,560 Speaker 12: five to ten years, you're going to see lots of 640 00:33:16,600 --> 00:33:20,720 Speaker 12: applications completely reinvented, you know, with new workflows, you know, 641 00:33:20,840 --> 00:33:21,920 Speaker 12: leveraging generator AI. 642 00:33:22,440 --> 00:33:25,600 Speaker 5: And you've got companies in the portfolio already doing that, 643 00:33:25,680 --> 00:33:27,920 Speaker 5: and you can name some of the other key AI 644 00:33:28,000 --> 00:33:30,959 Speaker 5: companies that you might want to anticipate coming to the market, 645 00:33:31,000 --> 00:33:34,360 Speaker 5: I'm sure, But what about the companies that aren't in 646 00:33:34,360 --> 00:33:37,720 Speaker 5: inherently AI focused and just tried to become So how 647 00:33:37,720 --> 00:33:38,520 Speaker 5: do you advise those? 648 00:33:38,880 --> 00:33:41,720 Speaker 12: Yeah, I think I think for I think any company 649 00:33:41,760 --> 00:33:44,240 Speaker 12: that started let's say more than three or four years 650 00:33:44,280 --> 00:33:47,560 Speaker 12: ago there at risk of being completely disrupted by a 651 00:33:47,600 --> 00:33:50,360 Speaker 12: new startup. So I think it's as a company that's 652 00:33:50,640 --> 00:33:52,840 Speaker 12: you know, that's that has a product line that whether 653 00:33:52,840 --> 00:33:55,680 Speaker 12: whether it's a publicly traded company or in newer startup, 654 00:33:56,120 --> 00:33:58,280 Speaker 12: they have to really go in AI enable. They have 655 00:33:58,320 --> 00:34:00,480 Speaker 12: to go and look at the application of AI, you know, 656 00:34:00,520 --> 00:34:03,040 Speaker 12: to their product line and you know and kind of 657 00:34:03,040 --> 00:34:06,120 Speaker 12: re imagine you know, other ways and either you know, 658 00:34:06,160 --> 00:34:08,279 Speaker 12: in a copilot mode or really you know, the more 659 00:34:08,320 --> 00:34:10,840 Speaker 12: important trend, if you know, if you take him the 660 00:34:11,000 --> 00:34:13,440 Speaker 12: one year review from here is it's all about asient 661 00:34:13,480 --> 00:34:17,600 Speaker 12: frameworks and agentic approaches. So most companies you know, really 662 00:34:17,600 --> 00:34:20,000 Speaker 12: should be looking at like, you know, how do these 663 00:34:20,000 --> 00:34:22,760 Speaker 12: technologies really apply, you know, to the product area. 664 00:34:24,239 --> 00:34:26,480 Speaker 6: Assuming there's one thing Caroline and I have learned in 665 00:34:26,520 --> 00:34:29,480 Speaker 6: the last I say, twelve months or so, it's that 666 00:34:29,719 --> 00:34:33,440 Speaker 6: not just a company is being founded incredibly quickly, but 667 00:34:33,560 --> 00:34:37,000 Speaker 6: a platform or products being built very quickly. You guys 668 00:34:37,000 --> 00:34:39,640 Speaker 6: have this EDGE program where that basically is what you 669 00:34:39,719 --> 00:34:44,760 Speaker 6: facilitate an idea from an individual through to a business quickly. 670 00:34:46,239 --> 00:34:49,080 Speaker 6: Just explain the process and how that's playing out. 671 00:34:49,520 --> 00:34:51,480 Speaker 12: Yeah, I know, thanks for asking about that, Ed. So, yeah, 672 00:34:51,520 --> 00:34:54,680 Speaker 12: we have a bespoke company building program at Graylock. 673 00:34:55,320 --> 00:34:56,239 Speaker 7: It's called Edge. 674 00:34:56,719 --> 00:34:59,080 Speaker 12: We're very selective about you know, who we pick in 675 00:34:59,120 --> 00:35:02,640 Speaker 12: the program, and uh, you know, once we do mutually 676 00:35:02,640 --> 00:35:04,600 Speaker 12: once an entrepreneur in Graylock, you know, kind of mutually 677 00:35:04,640 --> 00:35:08,440 Speaker 12: select each other. We basically work very closely with engineers 678 00:35:08,719 --> 00:35:12,600 Speaker 12: and founding teams all the way from market segmentation to 679 00:35:12,920 --> 00:35:17,240 Speaker 12: product strategy to insertion you know for initial product, working 680 00:35:17,239 --> 00:35:20,560 Speaker 12: with initial customers, building customer advisory boards. Then you know, 681 00:35:20,600 --> 00:35:23,000 Speaker 12: over time helping you know, recruit go to market. So 682 00:35:23,040 --> 00:35:25,719 Speaker 12: it's a very beastpoke program. And you know many years 683 00:35:25,760 --> 00:35:28,040 Speaker 12: ago Palo Alto Network start in our office through that, 684 00:35:28,719 --> 00:35:31,800 Speaker 12: you know, through you know, through that approach. You know 685 00:35:31,840 --> 00:35:33,960 Speaker 12: another one that when public started through that approach is 686 00:35:34,000 --> 00:35:35,160 Speaker 12: Zoomo Logic as well. 687 00:35:35,719 --> 00:35:35,839 Speaker 3: Uh. 688 00:35:36,000 --> 00:35:38,359 Speaker 12: And you know, more recently, you know a company called 689 00:35:38,400 --> 00:35:42,560 Speaker 12: Abnormal Security started in that process as well. They've rapidly 690 00:35:42,560 --> 00:35:45,200 Speaker 12: grown to become a late stage company. And we have 691 00:35:45,239 --> 00:35:48,240 Speaker 12: another one in stealth mode today, saying the San Francisco office. 692 00:35:48,520 --> 00:35:52,560 Speaker 6: You know in that program, shame Shan now Gray Lot partner. 693 00:35:52,600 --> 00:35:54,040 Speaker 6: It's great to have you on the program out of 694 00:35:54,080 --> 00:36:05,160 Speaker 6: New York. We really appreciate it. The Operator Have Shared 695 00:36:05,280 --> 00:36:08,279 Speaker 6: Electric Bikes and Scooters line, which is backed by the 696 00:36:08,400 --> 00:36:10,800 Speaker 6: likes of Uber, is planning to invest more than fifty 697 00:36:10,800 --> 00:36:14,560 Speaker 6: five million dollars this year to expand its fleet globally. 698 00:36:14,640 --> 00:36:17,440 Speaker 6: Joining us now is the line CEO Wayne Ting and 699 00:36:17,440 --> 00:36:20,160 Speaker 6: Wayne I find this really interesting because it's not just 700 00:36:20,200 --> 00:36:24,120 Speaker 6: San Francisco. The story of and relationship of micro mobility 701 00:36:24,160 --> 00:36:26,520 Speaker 6: here is well told, but you're looking at other regions 702 00:36:26,560 --> 00:36:31,600 Speaker 6: around the world. Which region is most receptive right now 703 00:36:31,640 --> 00:36:33,720 Speaker 6: to adding more to the microability offering? 704 00:36:34,239 --> 00:36:36,760 Speaker 13: Ed Thank you for having me. We actually see demand 705 00:36:37,200 --> 00:36:41,120 Speaker 13: from all of the world. Line is today in thirty countries, 706 00:36:41,160 --> 00:36:44,359 Speaker 13: five continents, three hundred plus cities. And the reason why 707 00:36:44,480 --> 00:36:47,520 Speaker 13: cities are so interested is because the biggest challenge of 708 00:36:47,560 --> 00:36:50,080 Speaker 13: our time is the challenge of the climate crisis. And 709 00:36:50,120 --> 00:36:52,920 Speaker 13: the number one source or corbon pollution in Europe and 710 00:36:53,239 --> 00:36:56,719 Speaker 13: in the United States is from transportation. The vast majority 711 00:36:56,719 --> 00:36:59,319 Speaker 13: of that is from personal cars and trucks. And if 712 00:36:59,360 --> 00:37:02,040 Speaker 13: we're going to need the challenge of climate change, that 713 00:37:02,120 --> 00:37:05,959 Speaker 13: we must transition away from cars and adopt more green 714 00:37:06,000 --> 00:37:09,960 Speaker 13: transportation alternatives like bikes and scooters, which is why I 715 00:37:10,000 --> 00:37:13,520 Speaker 13: think you're seeing cities all around the world embrace microability 716 00:37:13,560 --> 00:37:15,960 Speaker 13: as a way to reduce their reliance on cars. 717 00:37:16,920 --> 00:37:18,520 Speaker 6: Wait and I told our audience who are coming on 718 00:37:18,560 --> 00:37:20,440 Speaker 6: the show, and I put a poll out there to 719 00:37:20,520 --> 00:37:24,680 Speaker 6: ask do cities need more electric scooters and bikes? The 720 00:37:24,760 --> 00:37:28,480 Speaker 6: majority of respondents said no. Yeah, well almost the majority, 721 00:37:29,200 --> 00:37:32,440 Speaker 6: and in some cases they voted for few. There's still 722 00:37:32,840 --> 00:37:37,279 Speaker 6: sort of frustration and skepticism and disinterest out there. 723 00:37:37,280 --> 00:37:38,319 Speaker 7: How do you overcome it? 724 00:37:40,120 --> 00:37:42,360 Speaker 13: I think the best way we need to earn the 725 00:37:42,440 --> 00:37:46,960 Speaker 13: trust of residents and city governments in order to operate. 726 00:37:47,239 --> 00:37:48,719 Speaker 2: I think the best way to. 727 00:37:48,520 --> 00:37:50,719 Speaker 13: Ensure that is to make sure that our scooters and 728 00:37:50,760 --> 00:37:54,520 Speaker 13: bikes are parked responsibly, that we have a great safety record, 729 00:37:54,520 --> 00:37:57,400 Speaker 13: which we do that we continue to invest in technology 730 00:37:57,719 --> 00:38:00,719 Speaker 13: and line builds and r and ds every scooter bike 731 00:38:00,800 --> 00:38:03,439 Speaker 13: that we put on the street to ensure that they're 732 00:38:03,480 --> 00:38:06,640 Speaker 13: the safest, best ride on the out there. And when 733 00:38:06,640 --> 00:38:09,960 Speaker 13: we continue to deliver an excellent service, we will continue 734 00:38:09,960 --> 00:38:12,080 Speaker 13: to hopefully build that trust with cities to expand. 735 00:38:12,760 --> 00:38:16,000 Speaker 8: Waan, you're talking to a bike addict here. 736 00:38:16,400 --> 00:38:19,080 Speaker 5: I actually prefer the non electric ones than the electric 737 00:38:19,120 --> 00:38:21,000 Speaker 5: ones here, but I do it a lot here in 738 00:38:21,000 --> 00:38:21,600 Speaker 5: New York City. 739 00:38:21,640 --> 00:38:22,840 Speaker 8: I do it when I'm over in London. 740 00:38:22,840 --> 00:38:24,680 Speaker 5: I use the Uber apt to get what you're currently 741 00:38:24,680 --> 00:38:26,920 Speaker 5: seeing on your screen the line bike. But they're a 742 00:38:26,960 --> 00:38:28,879 Speaker 5: mess and they're everywhere, and I think that's a key 743 00:38:28,880 --> 00:38:31,120 Speaker 5: concern here. How do you ensure do you have to 744 00:38:31,160 --> 00:38:33,279 Speaker 5: spend more on infrastructure to ensure that people do have 745 00:38:33,360 --> 00:38:35,680 Speaker 5: places to park them? What is the responsibility of you, 746 00:38:35,840 --> 00:38:37,920 Speaker 5: Visa VI, the overall government right now? 747 00:38:38,560 --> 00:38:41,200 Speaker 2: I think it's it's a joint effort. 748 00:38:41,920 --> 00:38:45,160 Speaker 13: So you mentioned London, So London has two. 749 00:38:45,080 --> 00:38:46,320 Speaker 2: And a half million cars. 750 00:38:46,840 --> 00:38:49,279 Speaker 13: There are one hundred times more cars in London than 751 00:38:49,320 --> 00:38:53,520 Speaker 13: there are electric e bikes, and each parking spot can 752 00:38:53,560 --> 00:38:56,759 Speaker 13: fit six to eight e bikes. So if you say 753 00:38:56,800 --> 00:39:00,680 Speaker 13: there's over abundance of something, there's an over of cars 754 00:39:00,680 --> 00:39:04,279 Speaker 13: and London there's you know, if anything, if we can 755 00:39:04,360 --> 00:39:07,439 Speaker 13: even take a tenth of the parking spots of London 756 00:39:07,480 --> 00:39:10,760 Speaker 13: and turn it into bike parking corrals, we can easily 757 00:39:10,800 --> 00:39:13,319 Speaker 13: solve any parking issues we have in London. So we 758 00:39:13,400 --> 00:39:16,120 Speaker 13: have to continue to work with cities and city governments 759 00:39:16,120 --> 00:39:19,600 Speaker 13: the makeage infrastructure transition, to build more bike lanes and 760 00:39:19,640 --> 00:39:20,480 Speaker 13: protective bike. 761 00:39:20,360 --> 00:39:23,400 Speaker 2: Lanes, and to build more places where you can safely 762 00:39:23,520 --> 00:39:25,279 Speaker 2: respectfully park your e bikes. 763 00:39:25,680 --> 00:39:28,799 Speaker 5: You're someone who's building out spending money while you're also 764 00:39:28,800 --> 00:39:30,960 Speaker 5: thinking about profitability. And I know you've been thinking about 765 00:39:30,960 --> 00:39:32,280 Speaker 5: a bit dar positive. 766 00:39:32,040 --> 00:39:32,839 Speaker 8: For a couple of years now. 767 00:39:32,840 --> 00:39:34,239 Speaker 5: You probably took a leief out of the book of 768 00:39:34,320 --> 00:39:37,600 Speaker 5: Uber having worked so closely with Daara Costa Shah and continuing. 769 00:39:37,320 --> 00:39:38,759 Speaker 8: To work with Uber at line now. 770 00:39:38,840 --> 00:39:42,040 Speaker 5: But I'm interested as to what ultimately the goal is 771 00:39:42,040 --> 00:39:43,880 Speaker 5: at the moment you have to remain profitable in this 772 00:39:43,960 --> 00:39:44,760 Speaker 5: current environment. 773 00:39:44,840 --> 00:39:46,040 Speaker 8: Is that what the VCS are asking. 774 00:39:47,840 --> 00:39:51,359 Speaker 13: Yeah, so, Caroline, as you point out, twenty twenty three, 775 00:39:51,440 --> 00:39:54,480 Speaker 13: Line grew by over thirty percent and hit over six 776 00:39:54,560 --> 00:39:58,000 Speaker 13: hundred million dollars in gross bookings. It's actually a third 777 00:39:58,040 --> 00:40:01,520 Speaker 13: year of thirty plus percent growth in a role. More impressively, 778 00:40:01,600 --> 00:40:05,280 Speaker 13: our profitability five x to nearly one hundred million dollars 779 00:40:05,320 --> 00:40:08,480 Speaker 13: and adjust the ebitah, and that is actually what's enabled 780 00:40:08,560 --> 00:40:11,560 Speaker 13: us to invest fifty plus million dollars into. 781 00:40:11,400 --> 00:40:14,400 Speaker 2: Scaling e bikes. And I absolutely think. 782 00:40:14,280 --> 00:40:19,480 Speaker 13: That today's public markets demand sustainable and profitable companies, and 783 00:40:19,600 --> 00:40:21,600 Speaker 13: Line is showing that we can do it in a 784 00:40:21,719 --> 00:40:25,200 Speaker 13: very tough industry. As we continue to expand our profitability 785 00:40:25,200 --> 00:40:29,840 Speaker 13: and profit margins you go in public scene, well, I 786 00:40:29,840 --> 00:40:32,960 Speaker 13: think that depends on both the macro markets and our 787 00:40:32,960 --> 00:40:34,920 Speaker 13: internal business results. 788 00:40:35,200 --> 00:40:36,880 Speaker 2: What we can focus on is making sure that. 789 00:40:36,960 --> 00:40:40,920 Speaker 13: Line continues to grow rapidly and continues to expand our profitability. 790 00:40:41,280 --> 00:40:44,240 Speaker 13: The macro market still, I would say a little bit iffy, 791 00:40:44,560 --> 00:40:47,480 Speaker 13: Like you guys were chatting about Rubric. Rubric great, IICO 792 00:40:48,000 --> 00:40:50,080 Speaker 13: read it had a good ICO and then you had 793 00:40:50,080 --> 00:40:52,000 Speaker 13: an Instacar last year. But then it's still like one 794 00:40:52,000 --> 00:40:54,440 Speaker 13: step forward, three steps back. I would say the overall 795 00:40:54,440 --> 00:40:55,920 Speaker 13: ifield market is probably still. 796 00:40:55,719 --> 00:40:56,600 Speaker 2: A little frosty. 797 00:40:57,040 --> 00:40:59,240 Speaker 13: So we're doing everything we can to ensure that line 798 00:40:59,280 --> 00:41:03,160 Speaker 13: has the business, the profitability and the internal controls to 799 00:41:03,280 --> 00:41:05,200 Speaker 13: be ready to live as a public trading company. And 800 00:41:05,239 --> 00:41:07,160 Speaker 13: whether or not the right time is going to have 801 00:41:07,200 --> 00:41:09,440 Speaker 13: to depend on the macro markets, which is outside of 802 00:41:09,440 --> 00:41:09,920 Speaker 13: our control. 803 00:41:10,239 --> 00:41:13,560 Speaker 5: Waiting Lime CEO eyeing that market. Thank you for telling 804 00:41:13,600 --> 00:41:15,640 Speaker 5: your internals of the business. Meanwhile, let's get back to 805 00:41:15,680 --> 00:41:16,480 Speaker 5: those public markets. 806 00:41:16,480 --> 00:41:16,680 Speaker 12: Sad. 807 00:41:18,320 --> 00:41:21,440 Speaker 6: Yeah, astonishing week in earnings and then next week it's 808 00:41:21,480 --> 00:41:23,080 Speaker 6: another astonishing week in earnings. 809 00:41:24,040 --> 00:41:26,720 Speaker 5: Well, we've just had so much focus on AI spend, 810 00:41:27,080 --> 00:41:29,600 Speaker 5: the fact that they're what forty billion dollars a piece 811 00:41:29,600 --> 00:41:31,600 Speaker 5: on AI spend, But what can you get from that? 812 00:41:31,800 --> 00:41:36,040 Speaker 5: Google A performs, Microsoft performs. Will see what Apple, AMD 813 00:41:36,160 --> 00:41:38,319 Speaker 5: and Amazon have for us. That's it for this edition 814 00:41:38,360 --> 00:41:39,280 Speaker 5: of bringbour Technology. 815 00:41:40,239 --> 00:41:43,000 Speaker 6: Check out the podlodod This is BTech