WEBVTT - Bloomberg Businessweek Weekend - March 10th, 2023 0:00:01.000 --> 0:00:05.400 This is Bloomberg Business Week inside from the reporters and 0:00:05.600 --> 0:00:09.160 editors who bring you America's most trusted business magazine, plus 0:00:09.240 --> 0:00:13.200 global business, finance and tech news as it happen. Sloomberg 0:00:13.240 --> 0:00:19.720 Business Week with Carol Messer and Tim Stenebec on Bloomberg Radio. Hi, everyone, 0:00:19.760 --> 0:00:22.360 Welcome to the weekend edition of Bloomberg Business Week. Call 0:00:22.440 --> 0:00:24.880 at the Wall Street Churn. This past week, as FED 0:00:24.960 --> 0:00:27.560 Chair J. Powell spent two days up on Capitol Hill 0:00:27.560 --> 0:00:31.319 taking questions on the economy and monetary policy, reiterating that 0:00:31.360 --> 0:00:35.360 officials are likely to take rates higher than previously anticipated 0:00:35.640 --> 0:00:38.760 and could move at a faster pace if needed. Based 0:00:38.800 --> 0:00:41.880 on Friday's Mix Jobs report, investors now move their focus 0:00:41.960 --> 0:00:44.720 to this week's CPI report, and that's not the only 0:00:44.800 --> 0:00:47.600 risk for investors. More in a moment. Also, I have 0:00:47.760 --> 0:00:51.920 this CEO of Hpe, Antonio Nari on tech spending, Claire 0:00:52.000 --> 0:00:55.360 Hughes Johnson, former CEO at Stripe on a company's most 0:00:55.400 --> 0:00:59.040 important asset, and Priceline CEO Brett Keller with a global 0:00:59.160 --> 0:01:02.400 travel post. All of that to come. We begin with 0:01:02.440 --> 0:01:04.959 a story in this week's Finance section of the magazine. 0:01:05.360 --> 0:01:08.040 It was also a Bloomberg Big Take It details a 0:01:08.120 --> 0:01:11.640 looming risk that investors simply don't want to consider. We're 0:01:11.680 --> 0:01:14.360 talking about the US debt ceiling and what a default 0:01:14.400 --> 0:01:18.800 on federal debt would actually mean for markets. Bloomberg's Liz McCormick, 0:01:18.920 --> 0:01:22.320 Eric Wasson, Josh Wingrove, and Mike Dorning joined forces to 0:01:22.360 --> 0:01:25.440 bring us both the Wall Street and Washington perspectives. Liz 0:01:25.520 --> 0:01:28.600 is Bloomberg News chief correspondent for Global macro markets. She 0:01:28.720 --> 0:01:31.520 and Bloomberg Business Week editor Joe Webber join us with more. 0:01:31.959 --> 0:01:34.960 We in January hit that debt ceiling in which they 0:01:35.000 --> 0:01:38.559 had set a bit ago. Now the Treasury departments, using 0:01:38.680 --> 0:01:42.119 extraordinary measures kind of a special accounting moves to stay 0:01:42.200 --> 0:01:44.720 under it because they can't go above it. This is 0:01:44.800 --> 0:01:48.040 only going to get worse because there is, of course 0:01:48.080 --> 0:01:51.280 a limit to how long Treasury Secretary Janet Yellen and 0:01:51.320 --> 0:01:53.640 her team can do these maneuvers and stay under the 0:01:53.640 --> 0:01:57.280 debt limits, So they really need Congress to raise it 0:01:57.400 --> 0:01:59.880 or resuspend it, which they do many times. I feel 0:01:59.880 --> 0:02:01.680 like part of the problem, though, is that, you know, 0:02:01.920 --> 0:02:03.920 we come up against the seas ceiling and then we 0:02:03.960 --> 0:02:07.720 always figure something out. What's different this time around. Potentially, Well, 0:02:07.760 --> 0:02:10.240 I think this time around, and you know the gentleman 0:02:10.360 --> 0:02:13.240 on the story with me are the you know, Washington 0:02:13.320 --> 0:02:16.160 politics experts, but that you know, Eric Wason will tell 0:02:16.200 --> 0:02:19.360 you that we have a very contentious situation here where 0:02:19.400 --> 0:02:23.239 both sides you know, are jockeying. You know, the Republicans 0:02:23.280 --> 0:02:25.640 don't want a clean death sailing rays, which means that 0:02:25.720 --> 0:02:27.720 we just raise it. They want to kind of jockey 0:02:27.760 --> 0:02:31.360 for some future spending cuts, and President Biden and his 0:02:31.400 --> 0:02:33.480 team is saying, no, we don't want to do that, 0:02:33.639 --> 0:02:36.720 and you know, they seem pretty entrenched, and it kind 0:02:36.720 --> 0:02:39.360 of hearkens to twenty eleven where we had a very 0:02:39.880 --> 0:02:43.520 contentions death sailing episode that they eventually did come to 0:02:43.560 --> 0:02:46.040 something in the final hour, but it was such a 0:02:46.040 --> 0:02:48.800 messy process that the US for the first time ever 0:02:48.840 --> 0:02:52.400 by SMP got there rating downgraded from triple A, and 0:02:52.480 --> 0:02:54.600 you know that had a sting, even though we didn't 0:02:54.600 --> 0:02:58.400 see rates jump up sharply. Then you know, the stock 0:02:58.440 --> 0:03:01.640 market went down and it was a tumultuous time. So 0:03:01.919 --> 0:03:04.000 I think that's what people think this time it's going 0:03:04.040 --> 0:03:06.280 to go down to the wire. So that that story 0:03:06.280 --> 0:03:10.519 that Eric wasn't did about Brendan Boyle of Pennsylvania Representative, 0:03:10.560 --> 0:03:13.720 top democrat on the budget community. When I read our 0:03:13.800 --> 0:03:16.320 story and then I read that story, I was like, 0:03:16.360 --> 0:03:19.200 oh boy, this is scary. This got scarier all of 0:03:19.240 --> 0:03:22.240 a sudden, right because he's basically saying like, we're not 0:03:22.280 --> 0:03:24.280 going to back down. You know. It's funny, Joel, because 0:03:24.280 --> 0:03:26.520 everyone thinks, which we came to in our story, that 0:03:26.919 --> 0:03:30.680 of course they'll come to something. We've seen this movie before. 0:03:30.720 --> 0:03:33.200 It's a headache, we hate it, but well they'll do it. 0:03:33.639 --> 0:03:35.240 But when you know, you look at some of this 0:03:35.320 --> 0:03:38.800 stuff like Eric's laying out, it's really troublesome, and you know, 0:03:38.960 --> 0:03:41.680 like we hope, you know, cooler heads will prevail. No 0:03:41.760 --> 0:03:45.680 one would jeopardize the US treasuries as the world's safe 0:03:45.720 --> 0:03:49.960 haven security, which some people say. People may not realize 0:03:50.040 --> 0:03:53.000 if there's a default, be it short, you know, because 0:03:53.000 --> 0:03:55.160 they'll say, oh, well it'll be short, you know, but 0:03:55.280 --> 0:03:57.800 that doesn't matter. You know, the US doesn't default on 0:03:57.800 --> 0:04:00.880 their debt, and if they do, it could have repercussions 0:04:00.880 --> 0:04:04.160 for years and years. Okay, so x date, we don't 0:04:04.160 --> 0:04:06.760 know when that is what's our best sense of not 0:04:06.840 --> 0:04:15.360 a new dating app is it's not well. Janet Yellen 0:04:15.440 --> 0:04:18.320 says they have at least until like June. It seems 0:04:18.320 --> 0:04:20.520 like most of Wall Street is saying it probably goes 0:04:20.600 --> 0:04:23.960 until August. But it's very unclear because you know, it's 0:04:24.000 --> 0:04:26.320 kind of coming at the worst time. We're in tax season, 0:04:26.480 --> 0:04:29.480 right and the government doesn't know exactly how tax flows 0:04:29.480 --> 0:04:31.400 are going. I know I want a refund. They're trying 0:04:31.440 --> 0:04:34.440 to figure out of a we didn't get our refunds. 0:04:34.520 --> 0:04:36.440 I know, I know, I mean, that will happen, but 0:04:36.440 --> 0:04:37.880 they don't know how the flows are going to be, 0:04:38.000 --> 0:04:39.919 how much you know, the cash flows are going to go, 0:04:39.960 --> 0:04:42.880 how much refunds they're gonna have to pay out, how 0:04:42.960 --> 0:04:46.560 much inflows people paying their taxes. So it's very hard 0:04:46.560 --> 0:04:49.440 for the Treasury to kind of have a good timing of, 0:04:49.560 --> 0:04:51.920 you know, when we'll run out of these maneuvers didn't 0:04:51.960 --> 0:04:53.680 help if I was getting a refund and I said, 0:04:53.720 --> 0:04:55.720 why don't you guys just sit on it until August, 0:04:55.760 --> 0:04:57.680 and like it's like Social Security a little bit and 0:04:57.720 --> 0:04:59.880 maybe I get a little bonus. Wow, you're the man, 0:05:00.120 --> 0:05:04.680 And I'm just thinking he's got of I don't think 0:05:04.680 --> 0:05:07.800 I'll give mine whatever fund I'm giving nowhere near what 0:05:07.839 --> 0:05:12.560 we need want, Yeah, exactly exactly. So that's made it harder. 0:05:12.640 --> 0:05:14.960 That's why, you know, we know in past times, what 0:05:15.200 --> 0:05:17.400 a lot of the traders do is say, hey, listen, 0:05:17.440 --> 0:05:20.640 I'm not buying any Treasury bills or bonds that have 0:05:21.120 --> 0:05:24.040 coupon payments, which is this semi annual interest that's coming 0:05:24.040 --> 0:05:26.760 around that crazy X day time. But now this X 0:05:26.839 --> 0:05:30.640 date range is so wide that it's kind of murky 0:05:30.680 --> 0:05:32.560 in the market. Right. People are like, I don't know 0:05:32.640 --> 0:05:36.200 yet what debt to avoid, right, So maybe maybe that 0:05:36.440 --> 0:05:39.240 will become more clear as a troublesome when we get 0:05:39.240 --> 0:05:41.239 a better date. You know, maybe we'll get an update 0:05:41.240 --> 0:05:43.120 from the Treasury of when that X date is going 0:05:43.160 --> 0:05:45.560 to be. If the wheels start coming off this car 0:05:46.000 --> 0:05:48.559 ahead of that X date, do we have any sense 0:05:48.680 --> 0:05:51.200 what's going to break? Well, you know, after twenty eleven, 0:05:51.240 --> 0:05:53.760 a lot of the called parties that be that oversee 0:05:53.839 --> 0:05:55.680 the treasury market did a lot They were like, we 0:05:55.680 --> 0:05:57.800 don't want to go through this again with having no idea, 0:05:57.880 --> 0:06:00.320 So they did a lot of backup plans like if 0:06:00.360 --> 0:06:03.560 like maybe Treasury says, well, we'll delay the maturities a day. 0:06:03.720 --> 0:06:05.359 You know they can deal with that because you have 0:06:05.400 --> 0:06:08.480 to remember there's the repurchase agreement market that uses treasuries 0:06:08.520 --> 0:06:11.480 as collateral. So there's a lot of things that you know, 0:06:11.800 --> 0:06:13.920 what if it couldn't even function. So there's been some 0:06:13.960 --> 0:06:18.000 backup plans, but even those officials say, but we're not sure. 0:06:18.200 --> 0:06:20.240 You know, we haven't been through this before. You hope 0:06:20.279 --> 0:06:23.560 the treasury market will function. But Chairman Palell has also said, 0:06:23.800 --> 0:06:26.680 don't expect that the FED can swoop in and make 0:06:26.720 --> 0:06:29.280 a cure all evils. That it would be repercussions on 0:06:29.320 --> 0:06:32.599 the economy for a long time. It may sting borrowing 0:06:32.720 --> 0:06:35.760 costs for years and years or slaying that to me 0:06:35.839 --> 0:06:38.479 that if indeed we get that default, I mean, if 0:06:38.520 --> 0:06:41.039 somehow then there's a fix, quick fix after it, list 0:06:41.080 --> 0:06:44.080 would we still have that long term impact well the economy. 0:06:44.320 --> 0:06:45.960 That's what a lot of people say. Of course, we 0:06:46.000 --> 0:06:48.120 don't know till it happens. But you know, some very 0:06:48.120 --> 0:06:51.039 smart people have said in various stories we've done that 0:06:51.200 --> 0:06:54.520 it could be cured very fast. But you have to think. 0:06:54.680 --> 0:06:58.280 Some big investors say, I might add that I need 0:06:58.320 --> 0:07:01.840 a little cushion because you know, the US has defaulted, right, 0:07:01.920 --> 0:07:03.560 you know, so you would say there might be some 0:07:03.640 --> 0:07:06.479 premium added to yields, not just for a day or 0:07:06.480 --> 0:07:09.920 two maybe maybe small, but as a baseline for a 0:07:09.920 --> 0:07:13.840 long time, because it's totally different dynamic. You know, Yeah, 0:07:13.480 --> 0:07:18.320 what do we think on the Republican side, are they 0:07:18.400 --> 0:07:22.640 Is there any cracks anywhere in the in the in 0:07:22.720 --> 0:07:25.920 the wall that may be exposed here that may lead 0:07:26.120 --> 0:07:28.800 you know, a small group of people to say, you 0:07:28.800 --> 0:07:33.240 know what, we're not standing with McCarthy anymore. Well, not yet. 0:07:33.280 --> 0:07:36.679 There's a few strongholds. Remember McCarthy took so many votes 0:07:36.720 --> 0:07:38.600 to get him in as speaker, and he had to 0:07:38.600 --> 0:07:41.200 cut some deals, and you know that's made it harder 0:07:41.240 --> 0:07:43.800 because they also can kind of, let's just say, in 0:07:43.880 --> 0:07:46.640 light terms, spike him as the speaker. They have that option, 0:07:47.080 --> 0:07:49.520 So he has a lot to kind of payback to, 0:07:49.600 --> 0:07:52.960 do you know. Eric was saying that maybe you know, 0:07:53.160 --> 0:07:55.520 McCarthy in the end, you know, will do the best 0:07:55.560 --> 0:07:58.040 for the country and say, you know, I'll followed by 0:07:58.120 --> 0:08:02.600 sword and you know, we'll make a bipartisan deal. You know, 0:08:02.680 --> 0:08:05.160 so that it may go that way. But again, I 0:08:05.200 --> 0:08:08.000 think it comes down to markets getting ginned. Up stock 0:08:08.040 --> 0:08:10.800 selling off, and that being in the front of the 0:08:10.920 --> 0:08:15.280 local papers and things that policymakers may realize, oh this 0:08:15.400 --> 0:08:18.960 is bad, and you know, we'll come up with a deal. 0:08:19.000 --> 0:08:21.760 So it's just hard for me to believe that they won't. 0:08:23.120 --> 0:08:25.640 But like you know, one investor said to me, I 0:08:25.720 --> 0:08:28.920 don't know, never say never, you know, don't know. You know, Okay, 0:08:28.920 --> 0:08:33.480 So why throughout all of this and whatever may come 0:08:33.600 --> 0:08:38.120 yet Mark has been kind of singling like everything seems 0:08:38.160 --> 0:08:43.360 like it's not quite registered that this could go awry. Well, 0:08:43.559 --> 0:08:45.840 I think there's a few things. One is, like we said, 0:08:45.840 --> 0:08:49.079 they can't kind of know yet exactly when we'll hit 0:08:49.120 --> 0:08:52.400 that wall. Number two, there's a lot of other problems, right, 0:08:52.480 --> 0:08:55.120 you know, inflation is going to be sticky, you know, 0:08:55.240 --> 0:08:57.679 not to minimize traders, but there's only so many things 0:08:57.720 --> 0:08:59.840 they can worry about at once, right, So the deaths 0:09:00.280 --> 0:09:02.840 they're kind of you have far away a little bit. 0:09:03.000 --> 0:09:06.240 We have seen US credit default swaps, which is insurance 0:09:06.240 --> 0:09:08.839 against a default in the US. They're not a huge 0:09:09.000 --> 0:09:11.880 product here and they're not that liquid, but those you know, 0:09:12.000 --> 0:09:13.920 rates have gone up, so there is a few people 0:09:14.000 --> 0:09:16.559 buying some hedges against a default, right so I guess 0:09:16.600 --> 0:09:18.560 there's a little concern, but I think we need to 0:09:18.559 --> 0:09:22.160 get some more clarity. And you know, when this we 0:09:22.200 --> 0:09:24.320 could hit this wall from Marcus to really kind of 0:09:24.360 --> 0:09:27.960 like sell treasuries at that point in etc. Have we 0:09:28.040 --> 0:09:31.000 heard anything from the biggest holders of US treasuries at 0:09:31.000 --> 0:09:32.760 this point? And I think about whether it's to Japan. 0:09:32.880 --> 0:09:35.880 We always think about China when you talk about maybe 0:09:36.000 --> 0:09:37.880 ultimately in the future if we do get a default, 0:09:37.880 --> 0:09:40.880 they a lot more in terms of holding them. But 0:09:40.920 --> 0:09:44.400 have we heard anything from global investors on that front, well, 0:09:44.679 --> 0:09:47.520 sovereign nation, Yeah, no, they haven't. I think they don't 0:09:47.520 --> 0:09:49.840 want to get in the middle of this fight. I'm 0:09:49.880 --> 0:09:52.280 sure if it gets down to the wire, you know, 0:09:52.280 --> 0:09:54.400 we've gone through this before. You know, China's a little 0:09:54.440 --> 0:09:55.839 bit and they still hold a lot, but they're a 0:09:55.880 --> 0:09:57.839 little bit less of a player. US has a lot 0:09:57.880 --> 0:10:00.960 more domestic investors than they ever had, so we're not 0:10:00.960 --> 0:10:04.040 getting into that political jockeying. And I don't think they 0:10:04.040 --> 0:10:07.840 would speak beforehand. But you do have private investors saying like, 0:10:07.960 --> 0:10:10.160 I'm worried, Like I think I had some story saying, oh, 0:10:10.200 --> 0:10:12.240 there's not gonna be too much volatility ahead, and one 0:10:12.280 --> 0:10:15.360 investor emailed me, Liz, the debt ceiling. You know, so 0:10:15.440 --> 0:10:17.480 there are a lot of the private investors that are 0:10:17.559 --> 0:10:20.120 concerned that this could be you know, a lot of havoc. 0:10:20.480 --> 0:10:22.680 And even if we don't get a default, if it 0:10:22.720 --> 0:10:26.400 goes down to the wire and there's real concern, you 0:10:26.520 --> 0:10:28.720 might see just see more selling of treasures. Again, we 0:10:28.760 --> 0:10:32.720 have a backdrop of rates rising, inflation being sticky. There's 0:10:32.720 --> 0:10:35.120 a lot of concern out there. Anyway, That was Bloomberg 0:10:35.200 --> 0:10:38.439 News Chief correspondent for Global macro Markets Liz McCormick, along 0:10:38.440 --> 0:10:40.760 with the editor of Bloomberg Business Week, Joel Webber. Joe 0:10:40.800 --> 0:10:42.960 will be back a little bit later on coming up 0:10:43.040 --> 0:10:47.640 Hewlett Packard Enterprise CEO Antonio Nary on his company's strong quarter. 0:10:47.840 --> 0:10:59.520 You're listening to Bloomberg Business Week. This is Bloomberg. Please 0:10:59.600 --> 0:11:03.760 sees Bloomberg Business Week with Harold Messer and Tim Stenebec 0:11:04.200 --> 0:11:08.079 from Bloomberg Radio. So one way we've been trying to 0:11:08.080 --> 0:11:10.480 figure out what happens next in the global economy and 0:11:10.600 --> 0:11:13.680 financial markets is by listening to what CEOs are saying 0:11:13.679 --> 0:11:16.800 as they report earnings. With this quarter winding down, among 0:11:16.880 --> 0:11:21.080 the last major companies reporting was HPE Hewlett Packard Enterprise, 0:11:21.400 --> 0:11:23.600 which last week gave a strong forecast for the current 0:11:23.679 --> 0:11:26.920 quarter and boosted its annual outlook. The company's results of 0:11:27.040 --> 0:11:31.120 jest corporations are still upgrading their technology infrastructures, even in 0:11:31.200 --> 0:11:35.960 an uncertain economy. Antonio'nery is president CEO of HPE. He 0:11:36.080 --> 0:11:38.719 joined me and Bloomberg News Deputy team leader for US 0:11:38.760 --> 0:11:41.960 Equities Jess Benten to dig into the company's numbers. That 0:11:42.040 --> 0:11:46.840 the it spent is resilient, that it spent obviously shifting 0:11:46.920 --> 0:11:50.520 in different areas, but overall, I will say, continue to 0:11:50.520 --> 0:11:53.640 be a top priority for any enterprise of any size. 0:11:53.679 --> 0:11:56.560 And last week I actually I was in Europe talking 0:11:56.600 --> 0:12:00.280 to customers in France and Northern Europe, and they all 0:12:00.400 --> 0:12:02.520 very clear with me it will continue to be a 0:12:02.520 --> 0:12:05.880 top priority for them, whether it's to improve the resiliency 0:12:06.400 --> 0:12:09.960 of the company, or whether it's to mind data through 0:12:10.000 --> 0:12:13.439 the analytics portion of the investment, or whether it is 0:12:13.480 --> 0:12:17.160 to also digitize their business. So overall, I will say 0:12:17.520 --> 0:12:21.760 is good. There is some unevenness in some aspects, but overall, 0:12:21.800 --> 0:12:24.160 you know, when I think about r Q one performance, 0:12:24.160 --> 0:12:27.160 which was recro setting for the company on every metric 0:12:27.240 --> 0:12:31.440 you look at it, revenue, operating profit, and EPs. And 0:12:31.520 --> 0:12:34.400 the fact that we have a very solid order book, 0:12:34.800 --> 0:12:37.240 you give us the confidence to raise the outlook for 0:12:37.400 --> 0:12:40.120 both revenue and EPs, I will say, and I had 0:12:40.120 --> 0:12:43.720 a conversation with our Bloomberg intelligence analyst Wu Jenhoe, who said, 0:12:43.720 --> 0:12:47.240 you know, they were still a result and you did 0:12:47.360 --> 0:12:50.280 raise your outlook. You know, we also went through Dells 0:12:50.320 --> 0:12:53.400 report last night and your outlook was very different in 0:12:53.480 --> 0:12:56.760 contrast to Dells, which was much more dour. Why do 0:12:56.800 --> 0:12:58.920 you think there is that disparity that we're seeing in 0:12:58.960 --> 0:13:01.440 the industry because it's tough for us as we see 0:13:01.480 --> 0:13:03.520 you guys over port and talk about it. We listen 0:13:03.559 --> 0:13:07.760 to the c suite similar companies having so different outcomes. 0:13:08.400 --> 0:13:10.880 I think it's because people just look names and that 0:13:11.200 --> 0:13:13.480 they kind of put all together in the same back end. 0:13:13.520 --> 0:13:15.240 But the fact of the matter is we have a 0:13:15.240 --> 0:13:19.960 complete different portfolio. Obviously, Hewlett Packer Enterprise does a now 0:13:20.040 --> 0:13:24.640 participate in the PC business. That's our former pattern company 0:13:24.640 --> 0:13:27.440 in them now is independent HP Inc. But we have 0:13:27.480 --> 0:13:31.320 a unique diversified portfolio which makes us very different than Dell. 0:13:31.480 --> 0:13:35.440 We have an intelligence connected business which Dell doesn't not have. 0:13:35.640 --> 0:13:38.880 We have an AI business a scale that Dell doesn't 0:13:38.880 --> 0:13:41.319 not have, So you have to look at the portfolio 0:13:41.320 --> 0:13:43.920 and that's why it makes us very different. But also 0:13:43.960 --> 0:13:46.400 we have a different strategy because our strategy is to 0:13:46.480 --> 0:13:49.920 offer everything that we develop inside the company. Where is 0:13:50.120 --> 0:13:54.120 edge cloud NAI in a platform oriented approach, not swelling 0:13:54.960 --> 0:13:58.600 systems or commodity hardwork. And that's where it is so different. 0:13:58.720 --> 0:14:02.280 That's why customers and investors need to learn more about that, 0:14:03.000 --> 0:14:04.720 and that's why we are a little bit more polish 0:14:04.840 --> 0:14:08.120 than they are. We certainly have seen a fundamental trade 0:14:08.160 --> 0:14:11.160 of specific stories just right, And I'm glad you brought 0:14:11.200 --> 0:14:13.720 up Antonio when it comes to the cloud. You did 0:14:13.800 --> 0:14:16.360 announce how you do have that definitive agreement to acquire 0:14:16.480 --> 0:14:19.880 access security and that could help push you deeper into 0:14:19.920 --> 0:14:22.360 that space. What are you expecting to come out of 0:14:22.360 --> 0:14:24.560 that and are you expecting to have any more potential 0:14:24.600 --> 0:14:28.880 acquisitions on the horizon. Well, over the last eight weeks, 0:14:29.080 --> 0:14:33.480 we acquire four different assets always in this three domains 0:14:33.680 --> 0:14:37.760 edge cloud NAI. The first one was a company called 0:14:37.760 --> 0:14:41.360 packing There that allows us to do data pipeline automation 0:14:41.480 --> 0:14:44.640 for deploying AIA scale. So we have a unique asset 0:14:44.720 --> 0:14:48.080 with supercomputing that now becomes a kind of the old 0:14:48.080 --> 0:14:50.480 tech becomes the new tech in many ways because you 0:14:50.520 --> 0:14:54.240 need supercomputing power to trend these very large models and 0:14:54.320 --> 0:14:56.520 one of the challenge the customers have is to train 0:14:56.560 --> 0:15:00.560 those models in a very large scale data pipeline. The 0:15:00.560 --> 0:15:04.480 second answer we bought was a company that does software 0:15:04.520 --> 0:15:08.680 defined compute for in memory wordloads. Think about those workloads 0:15:08.760 --> 0:15:11.640 like database that needs a law of memory. We can 0:15:11.680 --> 0:15:14.800 now do that a cloud scale. The third one was 0:15:15.160 --> 0:15:17.480 Private five G. So when we think about the edge, 0:15:17.600 --> 0:15:21.400 the ability to provide a ubiquitous connectivity layer from Wi 0:15:21.480 --> 0:15:25.880 Fi to land to software define what they're a network. 0:15:25.920 --> 0:15:29.880 Now we are bolted into the same architecture the Private 0:15:29.920 --> 0:15:32.920 five G because Wi Fi and priv five G are 0:15:33.000 --> 0:15:36.520 very complementary. And that's a company called Athonet. And last 0:15:36.520 --> 0:15:39.240 one unless the one you mentioned, which is access security, 0:15:39.280 --> 0:15:42.240 because you need to wrap all that connectivity layer with 0:15:42.360 --> 0:15:45.760 a secure access secure edge, and we will have the 0:15:45.960 --> 0:15:49.120 most complete portfolio on the connecting intelligent edge. And that's 0:15:49.160 --> 0:15:52.040 an opportunity to continue to growth in the adjustance market. 0:15:52.280 --> 0:15:56.000 But ultimate customer want and integrated secure solution. You've also 0:15:56.000 --> 0:15:58.880 been tied to new Tanics. Is something likely to happen there? 0:15:59.240 --> 0:16:02.600 We always we don't comment on speculation. I will say 0:16:02.680 --> 0:16:06.440 we always look for assets that accelerates our journey into 0:16:06.520 --> 0:16:09.760 the three domains. You know, for us, it's all about 0:16:09.800 --> 0:16:14.760 accelerate accelerated momentum with hp green Lake. Hpeagreen Lake is 0:16:14.760 --> 0:16:17.480 a flagship product and one of the metrics are quoted 0:16:17.600 --> 0:16:20.800 yesterday is that with the HPI green Lake and the 0:16:20.920 --> 0:16:24.760 total as a service business in two twenty one Q 0:16:24.880 --> 0:16:27.840 one twenty twenty one, our total control value was five 0:16:27.880 --> 0:16:31.520 billion dollars. At the end of Q one twenty twenty three, 0:16:31.560 --> 0:16:33.880 a total contra value in the balance sheet is ten 0:16:33.960 --> 0:16:37.520 billion dollars, so we double the business. And obviously we 0:16:37.560 --> 0:16:40.920 look at all these assets that accelerate the strategy, particularly 0:16:40.920 --> 0:16:44.880 in the software the findes kind of a layer as 0:16:44.880 --> 0:16:48.600 well as automation. What about a larger strategic deal. Is 0:16:48.600 --> 0:16:53.320 that something that could happen? You know, we look at 0:16:53.680 --> 0:16:55.720 all a type of assets. But one of the things 0:16:55.840 --> 0:16:59.720 I might CEFO and I hold ourselves accountable to is 0:16:59.760 --> 0:17:05.440 a discipline, return based investment. And you know, with the 0:17:05.520 --> 0:17:08.320 last four acquisitions. I have now done more than three 0:17:08.440 --> 0:17:12.120 acquisitions in the last six years or so, and all 0:17:12.160 --> 0:17:15.879 of them fits in that consistent framework where we bring 0:17:16.080 --> 0:17:19.160 unique ip and talent that we can scale to our 0:17:19.200 --> 0:17:22.440 go to market. And obviously, as valuation come down from 0:17:22.480 --> 0:17:26.640 their highs and multiples that were in some cases not justifiable, 0:17:27.160 --> 0:17:29.800 we look at all of them, but again we stay 0:17:29.880 --> 0:17:33.640 strict to that framework. Yeah, one of the criticisms came 0:17:33.720 --> 0:17:36.320 to the guidance and your momentum moving forward and how 0:17:36.320 --> 0:17:39.159 that momentum could actually slow in the second half of 0:17:39.160 --> 0:17:41.840 the year. Is that something that's more of a potentially 0:17:41.960 --> 0:17:44.960 conservative estimate and something that might be we could see 0:17:45.000 --> 0:17:47.800 some revisions. They're happening depending on how obviously the business 0:17:47.840 --> 0:17:51.760 outlook changes in the macro outlook as well. You know, 0:17:51.800 --> 0:17:54.040 I have to tell you sometimes I'll understand some of 0:17:54.040 --> 0:17:57.239 these questions because when you think about it, you know, 0:17:57.359 --> 0:17:59.720 at the end of QUE four twenty twenty two, which 0:17:59.760 --> 0:18:03.000 we at an outstanding quarterer, we guided for the full 0:18:03.080 --> 0:18:06.760 year two to four percent year over year revenue growth 0:18:06.800 --> 0:18:09.560 for twenty twenty three. With the new guidance, we are 0:18:09.680 --> 0:18:13.800 doubling that revenue from the midpoint three to now five 0:18:13.840 --> 0:18:18.480 to seven million, midpoint six. So Alont call that conservative. 0:18:18.640 --> 0:18:21.920 You know, when you double the revenue guidance. Alont called 0:18:21.960 --> 0:18:26.040 that conservative. And in addition to that, let's remind ourselves, 0:18:26.040 --> 0:18:30.320 we're also raising the earnest per share guidance by another sixpennies. 0:18:31.160 --> 0:18:34.520 Now we stand that we have a massive headwind on currency. 0:18:34.960 --> 0:18:37.920 You know our eighteen percent year over year revenue growth 0:18:38.040 --> 0:18:40.760 that we just posted. Yeah, the five hundred and fifty 0:18:40.800 --> 0:18:43.679 basis points head winds. So we are prudent, you know. 0:18:43.760 --> 0:18:45.480 And this is why, which is early in the year. 0:18:45.720 --> 0:18:49.000 That was Antonio Nary, president CEO of HPE. You joined 0:18:49.000 --> 0:18:51.440 me and Bloomberg News Deputy team leader for US Equities, 0:18:51.480 --> 0:18:53.880 Jess Metton. Jess will be back in the next hour. 0:18:54.400 --> 0:18:57.600 Still ahead on Bloomberg Business Week, a decorated tech executive 0:18:57.840 --> 0:19:01.080 explains the most important building block of a successful company. 0:19:01.320 --> 0:19:04.040 If you're not investing in yourself as a leader and manager, 0:19:04.119 --> 0:19:06.400 or in your talent, you're gonna have a problem because 0:19:06.440 --> 0:19:08.840 you need more out of them, and you can't let 0:19:08.840 --> 0:19:11.800 growth paper over challenges. I mean, I do think the 0:19:11.800 --> 0:19:16.640 pandemic cause more disconnection. So if you're not reconnecting, it's 0:19:16.680 --> 0:19:19.360 going to get worse. There seems to be something soft 0:19:19.480 --> 0:19:22.760 in saying people investment or people matter, when in fact, 0:19:23.119 --> 0:19:25.919 I think the best places, the best managers and leaders 0:19:26.160 --> 0:19:29.960 have very high standards but also deep devotion. Right. It's 0:19:29.960 --> 0:19:33.720 the marriage of the caring and the expectations. And I 0:19:33.800 --> 0:19:35.520 worry people were like, well, we've got to just take 0:19:35.520 --> 0:19:38.280 our foot off the gas, because yeah, there was a pandemic. 0:19:38.600 --> 0:19:41.280 Terrible things have happened in this country and around the world, 0:19:41.720 --> 0:19:44.520 and it is very hard and people are tired. But 0:19:44.640 --> 0:19:46.560 you know what, we want to be inspired. We want 0:19:46.600 --> 0:19:48.280 to be inspired by where we work and the people 0:19:48.280 --> 0:19:50.080 we work with. And if you don't have a high 0:19:50.119 --> 0:19:53.000 standard coupled with that empathy and that devotion and that investment, 0:19:53.200 --> 0:19:54.680 you're not doing your job and you're not going to 0:19:54.760 --> 0:19:58.240 get the results. Stripe executive and Silicon Valley veteran Claire 0:19:58.320 --> 0:20:01.720 Hughes Johnson provides her playbook, Look for Better Business Practices 0:20:01.800 --> 0:20:11.080 in Any Industry. This is Bloomberg Broadcasting from the Financial 0:20:11.119 --> 0:20:14.600 Capital of the World Bloomberg eleven Frio in New York 0:20:14.720 --> 0:20:17.920 to Washington, d C. Bloomberg ninety nine one to Boston, 0:20:18.040 --> 0:20:21.440 Bloomberg one O six one to San Francisco, Bloomberg nine 0:20:21.560 --> 0:20:24.720 sixty to the country, Sirius XM Chado one nineteen and 0:20:24.840 --> 0:20:28.200 around the globe, the Bloomberg Business app and Bloomberg Radio 0:20:28.320 --> 0:20:32.640 dot Com. This is Bloomberg Business Week with Carol Masser 0:20:32.880 --> 0:20:38.399 and Tim Stenebec from Bloomberg Radio. Okay, so you know, 0:20:38.440 --> 0:20:40.919 we've had lots of conversations with heads of companies and 0:20:41.040 --> 0:20:44.520 organizations of all sizes. One common denominator the fight for 0:20:44.560 --> 0:20:47.880 workers in today's tight labor market. We got another read, 0:20:47.920 --> 0:20:50.000 as you know, on the US employment picture with the 0:20:50.040 --> 0:20:53.000 monthly data released on Friday. Well, our next guest knows 0:20:53.080 --> 0:20:55.960 a lot about people management and building a company thanks 0:20:56.000 --> 0:20:59.040 to its people. Claire Hughes Johnson spent ten years at 0:20:59.040 --> 0:21:03.359 Google oversaw some key projects. She is a corporate officer 0:21:03.359 --> 0:21:06.840 and advisor to Stripe. Was COO It's Stripe. She's got 0:21:06.840 --> 0:21:09.720 a new book out, Scaling People, Tactics for Management and 0:21:09.800 --> 0:21:14.199 Company Building. She explained some common pitfalls of today's business leaders. 0:21:14.520 --> 0:21:17.200 What we've probably done is thought that just people management 0:21:17.200 --> 0:21:20.440 will come naturally to us. But I do think it's learnable. 0:21:20.480 --> 0:21:22.560 I mean, I think a lot about scaling people is 0:21:22.560 --> 0:21:24.320