WEBVTT - Nvidia Earnings In Focus; SpaceX Eyes Historic IPO 0:00:00.080 --> 0:00:13.480 Bloomberg Audio Studios, Podcasts, radio news. Bloomberg Tech is alive 0:00:13.560 --> 0:00:17.360 from coast to coast with Caroline Hyde and New York 0:00:17.680 --> 0:00:20.800 and Vla Low in San Francisco. 0:00:22.880 --> 0:00:26.000 This is Bloomberg Tech coming up in video. Earnings on deck, 0:00:26.079 --> 0:00:29.000 a huge moment to the world's most valuable company in 0:00:29.080 --> 0:00:32.320 the stock at the center of the AI Boom plus 0:00:32.360 --> 0:00:34.680 SpaceX inches closer to launch. 0:00:34.720 --> 0:00:35.239 It could be. 0:00:35.240 --> 0:00:39.239 Today that must company unveils it's IPO filing and we 0:00:39.280 --> 0:00:42.400 take a deep dive into soft banks bet on open 0:00:42.440 --> 0:00:46.879 AI insiders worried the Masoschi sun is too tight to 0:00:46.920 --> 0:00:50.479 the AI giant. Right now in video is everything that 0:00:50.479 --> 0:00:53.880 the Bloomberg Tech audience is clicking on reading about, talking 0:00:53.880 --> 0:00:55.880 about We're up two percent, taking our year to D 0:00:55.880 --> 0:00:59.640 eight game twenty percent. We expect eighty percent top line growth, 0:01:00.040 --> 0:01:02.880 eighty five percent growth in earnings per share. But there 0:01:02.880 --> 0:01:06.480 are questions about China and how much momentum this AI 0:01:06.600 --> 0:01:07.440 story has. 0:01:07.760 --> 0:01:09.720 Let's get the stock story for the world's. 0:01:09.440 --> 0:01:14.640 Most valuable company with Bloomberg Tech Equasies Reporter Carmen Ryanikey Friday, 0:01:14.840 --> 0:01:19.479 Monday Tuesday, we were almost in correction territory within video 0:01:19.520 --> 0:01:21.199 at the heart of what was happening in chip stocks. 0:01:21.240 --> 0:01:23.959 You write today that in Videa's earnings will either make 0:01:24.360 --> 0:01:29.080 or will break the rally and chips, why, Yeah, So. 0:01:29.160 --> 0:01:32.080 It's been so important in video overall. Right, we know 0:01:32.120 --> 0:01:34.520 it's sort of the king maker of the AI trade. 0:01:34.640 --> 0:01:37.000 It's the stock that all investors are watching really to 0:01:37.040 --> 0:01:39.679 see the demand going forward and if that story is 0:01:39.720 --> 0:01:42.680 still strong. And so this huge rally that we've seen 0:01:42.760 --> 0:01:45.280 in the chip making space really from this March thirtieth 0:01:45.360 --> 0:01:49.240 low up through last week, it's had incredible momentum. But 0:01:49.320 --> 0:01:51.640 in video is really the thing that investors are going 0:01:51.680 --> 0:01:53.880 to watch to see if this can go forward. We 0:01:54.040 --> 0:01:56.240 got a little bit of a rest fit over the 0:01:56.280 --> 0:01:58.160 last few days, we saw a sell off, but we're 0:01:58.240 --> 0:02:00.840 kind of back up that rally is going stronger today. 0:02:00.960 --> 0:02:04.040 So how Nvidia talks about the future demand here is 0:02:04.080 --> 0:02:06.200 going to be paramount to that entire sector. 0:02:07.040 --> 0:02:09.120 Calm and the m Live and macro View team go 0:02:09.240 --> 0:02:13.840 back and say, what typically happens post earnings for Nvidia, 0:02:13.880 --> 0:02:17.040 even if it is a blowout, and this is the answer. 0:02:17.520 --> 0:02:20.560 It's a pretty mixed picture, right. There is no guarantee 0:02:20.840 --> 0:02:23.960 that even if Nvidia has a bond storming print that 0:02:24.080 --> 0:02:26.560 in the days that follow, even the month that follows, 0:02:27.280 --> 0:02:29.920 the market will go with it exactly. 0:02:29.960 --> 0:02:32.400 So, something that we've seen over the last few earnings 0:02:32.440 --> 0:02:35.119 reports for in video is that shares at actually fall 0:02:35.200 --> 0:02:37.800 in the day after results, even if they're very strong, 0:02:37.840 --> 0:02:40.000 even if it's a blowout report. Some of that is 0:02:40.040 --> 0:02:42.720 pretty typical around earnings. You get a little bit of 0:02:42.760 --> 0:02:45.880 a buy the rumor sell the news. Obviously, this could 0:02:45.919 --> 0:02:48.280 be a good place for investors to trim to sort 0:02:48.320 --> 0:02:51.520 of take some profits, especially after such an incredible rally. 0:02:51.880 --> 0:02:53.560 And the other thing I'd say is that so in 0:02:53.680 --> 0:02:56.040 Vidia is still the most important stock in the S 0:02:56.080 --> 0:02:58.160 and P five hundred, it's the largest company in the world, 0:02:58.160 --> 0:03:00.680 it commands the most weight in the index, but it's 0:03:00.720 --> 0:03:03.960 not immune to broader macro pressures. And we have seen 0:03:04.320 --> 0:03:08.919 sort of the pull and of the AI trade continuing 0:03:09.000 --> 0:03:12.280 over this year. So while it's very important to see 0:03:12.320 --> 0:03:15.640 the future demand there for these stocks, it's also no 0:03:15.760 --> 0:03:18.680 guarantee that this is going to continue to march forward 0:03:18.720 --> 0:03:21.040 and up to the right, especially just in the days 0:03:21.080 --> 0:03:21.799 after the report. 0:03:22.000 --> 0:03:25.280 Hey common how often before the show and before big 0:03:25.280 --> 0:03:27.880 moments are Ibu, and I say, calm and check me 0:03:27.919 --> 0:03:28.240 on this. 0:03:28.840 --> 0:03:29.680 Let's do it again. 0:03:30.160 --> 0:03:33.400 In Vidia's twenty four times forward earnings twelve month forward 0:03:33.400 --> 0:03:36.440 earnings that seems below. 0:03:36.520 --> 0:03:37.720 It's historical average. 0:03:37.880 --> 0:03:40.560 I'm basically saying, tell me about the valuation of this 0:03:40.640 --> 0:03:41.880 company going into this print. 0:03:42.400 --> 0:03:46.320 Yeah, So we've seen in Vidia's valuation sort of continuously 0:03:46.480 --> 0:03:49.920 tick down even through the stocks rally, because its earnings 0:03:49.960 --> 0:03:54.440 growth is so astronomical. So basically, what investors are paying 0:03:54.640 --> 0:03:57.080 for that forward earnings growth is less than a lot 0:03:57.120 --> 0:03:59.760 of other companies, even other companies in the space that 0:03:59.800 --> 0:04:01.440 come manda much higher valuation. 0:04:01.720 --> 0:04:03.960 So it's interesting that it's so cheap. 0:04:04.120 --> 0:04:07.560 Usually that entices investors to jump back into the stock, 0:04:07.920 --> 0:04:11.119 but that remains to be seen. We'll see what happens 0:04:11.160 --> 0:04:12.440 in the after hours today. 0:04:13.360 --> 0:04:15.800 So smart and given the impact at the index level, 0:04:15.880 --> 0:04:17.640 that's why I wanted to start on the stock story. 0:04:17.640 --> 0:04:21.360 Bloomberg's Carmen Ryinike, thank you very much. That's the broader picture. 0:04:21.480 --> 0:04:24.839 Let's dive into Nvidia's specific concerns. We've got to Bloomberg's 0:04:24.839 --> 0:04:28.279 Maggie Eastland, and this is about a story of AI momentum, 0:04:28.440 --> 0:04:32.039 the infrastructure build out, the basics, What does the world 0:04:32.080 --> 0:04:34.920 think Nvidia is going to say after the market closed. 0:04:34.680 --> 0:04:39.800 Today, Well, look across the board, folks are expecting a 0:04:39.920 --> 0:04:43.640 really strong performance from Nvidia, But like we discussed earlier, 0:04:43.680 --> 0:04:46.800 that might not necessarily translate to stock market gains because 0:04:46.839 --> 0:04:48.480 at this point they're expected to do well. 0:04:48.640 --> 0:04:49.840 AI demand is strong. 0:04:50.120 --> 0:04:52.720 Jensen Wong has said that repeatedly. The thing that they're 0:04:52.720 --> 0:04:56.200 going to be looking through is trying to determine how 0:04:56.279 --> 0:05:00.000 long can this AI boom really last? Is this sustainable 0:05:00.160 --> 0:05:03.000 for demand to be this strong for this long? And 0:05:03.040 --> 0:05:05.760 then more specifically, what are some of the supply constraints. 0:05:06.000 --> 0:05:07.880 Obviously demand is skyrocketing. 0:05:08.080 --> 0:05:09.080 There are things like. 0:05:09.279 --> 0:05:12.800 Memory, like networking that in video could run into bottlenecks 0:05:12.960 --> 0:05:16.080 that ultimately limit how much of their AI compute they're 0:05:16.080 --> 0:05:18.480 able to supply to hyperscalers and other customers. 0:05:20.160 --> 0:05:24.120 Maggie, we're in the unusual situation, aren't we, Where it's Wednesday, 0:05:24.240 --> 0:05:26.920 we have earnings. I just got back from Las Vegas. 0:05:26.920 --> 0:05:27.359 We spoke to. 0:05:27.400 --> 0:05:29.880 Jensen Wong on Monday, and to your point on the 0:05:29.920 --> 0:05:32.520 supply demand dynamic, this is what he had to say. 0:05:33.320 --> 0:05:35.159 We have the largest supply chain in the world. 0:05:35.760 --> 0:05:39.920 Our partners have done a great job securing supply for us, 0:05:40.279 --> 0:05:43.080 and so all of the pieces go together. The silicon, 0:05:43.160 --> 0:05:46.440 photonics is lined up, Everything is all lined up. It's 0:05:46.480 --> 0:05:49.839 just that the demand is much greater than the overall 0:05:49.880 --> 0:05:51.000 capacity of the world. 0:05:52.520 --> 0:05:55.039 Then there's the overhang, and I think you and I 0:05:55.080 --> 0:05:57.640 both know the overhang on in Video is probably China, 0:05:57.839 --> 0:06:01.159 even if it's not material in some sense, where do 0:06:01.240 --> 0:06:02.200 we stand on China? 0:06:04.440 --> 0:06:08.400 Look, the outlook is still very cloudy. So back in March, 0:06:08.920 --> 0:06:12.520 Jensen Wong told investors that he was firing up H 0:06:12.560 --> 0:06:15.520 two hundred production and he had US permissions. Now the 0:06:15.600 --> 0:06:18.520 US has confirmed that. But what we're seeing, even after 0:06:18.640 --> 0:06:21.760 Jensen joined for the trip to China last week, is 0:06:21.800 --> 0:06:24.680 that US officials are saying China is blocking its companies 0:06:24.720 --> 0:06:27.320 from purchasing H two hundreds. So that's a question that 0:06:27.360 --> 0:06:29.880 investors are going to be asking, and in Video is 0:06:30.080 --> 0:06:33.520 likely to address some of that cloudiness during its earnings. 0:06:33.120 --> 0:06:33.920 Call after hours. 0:06:34.960 --> 0:06:37.680 It's been really interesting sitting next to you at some 0:06:37.720 --> 0:06:39.560 of the events of the last twelve months. Right we 0:06:39.600 --> 0:06:43.080 started with CS in January, then GtC. A lot of 0:06:43.120 --> 0:06:45.760 this is about Jensen one trying to convince the world 0:06:46.240 --> 0:06:49.520 that AI is doing things that are meaningful and useful. 0:06:49.960 --> 0:06:51.719 How much do you expect him to kind of linger 0:06:51.760 --> 0:06:53.560 on that on the call, not necessarily talk about the 0:06:53.600 --> 0:06:56.840 data centers getting built within video GPUs, but he tends 0:06:56.880 --> 0:06:59.080 to offer up, hey, this is what I'm doing with 0:06:59.120 --> 0:07:01.440 this particular piece of software, or this is what I 0:07:01.440 --> 0:07:02.480 see in the enterprise. 0:07:04.600 --> 0:07:08.159 Absolutely, I'm fully expecting Judson to emphasize all of the 0:07:08.240 --> 0:07:11.680 applications for AI. Right That's the question that hyperskillers are 0:07:11.720 --> 0:07:13.640 also sort of facing, is what is the end use 0:07:13.680 --> 0:07:16.000 of this? Where is the return on investment going to 0:07:16.040 --> 0:07:18.520 finally arrive? So we're definitely going to see and focus 0:07:18.560 --> 0:07:21.040 on that. You also may see a focus on imprinting 0:07:21.400 --> 0:07:24.520 with that Grock acquisition. You know, there is this story 0:07:24.560 --> 0:07:28.280 in AI land that essentially compute demand is moving from 0:07:28.320 --> 0:07:31.200 training to imprincing, and the question for nvideo is are 0:07:31.200 --> 0:07:33.679 they going to be able to maintain their competitive mode 0:07:33.920 --> 0:07:35.520 as the industry makes that shift. 0:07:36.440 --> 0:07:40.440 Kloomberg's Maggie Eastland top Top Reporting. Thank you very much. 0:07:40.760 --> 0:07:42.800 There's another big one out there today and come in up. 0:07:43.280 --> 0:07:46.880 SpaceX moves closer to what could be the biggest IPO 0:07:46.960 --> 0:07:49.680 in market history. We're waiting on a pretty key document 0:07:49.920 --> 0:07:52.280 and we're going to break down what to expect. It 0:07:52.320 --> 0:07:56.000 is primed for list off. This is what financial markets 0:07:56.040 --> 0:07:58.600 look like right now. Then a's that one hundred rebounding 0:07:58.680 --> 0:08:03.320 up more than a percentage point. Semiconductors rebounding again. Friday, Monday, Tuesday, 0:08:03.320 --> 0:08:05.800 we were headed for correction territory. We're up almost four 0:08:05.840 --> 0:08:07.760 percent on the socks in videos at the heart of 0:08:07.760 --> 0:08:10.360 the story, and we're going to keep that story throughout 0:08:10.400 --> 0:08:10.800 the show. 0:08:11.040 --> 0:08:12.720 We'll be right back. This is Bloomberg Tech. 0:08:27.440 --> 0:08:32.600 Investors are watching waiting for SPACEXIPO. The s one could 0:08:32.640 --> 0:08:35.200 flip public as soon as today. That's the reporting, and 0:08:35.240 --> 0:08:39.080 the company reportedly targeting a seventy five billion dollar raise 0:08:39.320 --> 0:08:42.760 in a listing that could value SpaceX up to more 0:08:42.840 --> 0:08:45.360 than two trillion. We also learn more about the banks. 0:08:45.440 --> 0:08:49.520 Let's talk to Bloomberg's Anthony Hughes. It looks like Goldman 0:08:49.640 --> 0:08:54.240 is flush lead left. Surprising because Morgan Stanley is also 0:08:54.480 --> 0:08:55.720 a lead bank. 0:08:56.559 --> 0:09:00.480 Ah Hi ed, Yes, well, I think that's not that's prizing. 0:09:01.840 --> 0:09:04.800 Goldman has got the coveted lead left role here, But 0:09:04.840 --> 0:09:07.400 whether that really means they're leading the IPO. I mean, 0:09:07.440 --> 0:09:09.960 they are leading the IPO, but to what extent they 0:09:09.960 --> 0:09:12.720 are leading it in a joint capacity with Morgan Stanley 0:09:12.760 --> 0:09:15.320 will be sort of you know, a big copic of 0:09:15.360 --> 0:09:19.040 debate in banking circles. But as we you know, we 0:09:19.080 --> 0:09:22.280 are expecting the prospectives to show that Goldman is named 0:09:22.320 --> 0:09:26.400 first and Morgan Stanley second, and then three or four 0:09:26.720 --> 0:09:29.120 of the other big banks will be you know, on 0:09:29.160 --> 0:09:32.079 the top top line. But you know it's a it's 0:09:32.120 --> 0:09:35.200 a it's for Golden Sacks. There's there's the bragging rights 0:09:35.200 --> 0:09:37.200 associated with that. But we know that Morgan Stanley's very 0:09:37.200 --> 0:09:40.400 heavily involved in the IPO as well, and you know, 0:09:40.440 --> 0:09:43.320 it may be that those those names are in alphabetical order. 0:09:43.360 --> 0:09:44.280 It's possible. 0:09:44.640 --> 0:09:47.319 And also you know, we know the Golden Sacks has 0:09:47.520 --> 0:09:49.440 obviously done a lot of work for Tesla in the 0:09:49.440 --> 0:09:52.240 past as well, so you know, we knew that Golden 0:09:52.280 --> 0:09:53.760 Sacks was going to have a pretty big role on 0:09:53.800 --> 0:09:55.400 this as well. 0:09:56.080 --> 0:09:58.800 We've must is anything as straightforward as things being in 0:09:58.800 --> 0:10:02.280 alphabetical order. I mean, Morgan Stanley too, Wright has done 0:10:02.280 --> 0:10:04.640 a lot with XAI, did a lot with Twitter at 0:10:04.679 --> 0:10:07.040 the time that must bought it. The thing about you, 0:10:07.080 --> 0:10:09.599 Anthony is you're a student of history. You've covered a 0:10:09.640 --> 0:10:11.560 lot of these IPOs tech IPOs, Like if you look 0:10:11.559 --> 0:10:14.440 at Ali Barber, there was a flush lead left then, 0:10:14.640 --> 0:10:17.480 but after the fact, when you pour through it, it 0:10:17.559 --> 0:10:19.040 was pretty much equal economics. 0:10:19.360 --> 0:10:20.920 Yeah, if we go back to Ali Barber, which was 0:10:20.960 --> 0:10:23.680 in twenty fourteen, and you know, that was the biggest 0:10:23.760 --> 0:10:26.800 IPO of the biggest us IPO, it is still the 0:10:26.800 --> 0:10:29.480 biggest us IPO of all time. But that IPO actually 0:10:29.480 --> 0:10:32.720 listed Credit Swiss in that lead left spot, and Credit 0:10:32.800 --> 0:10:36.600 Swiss doesn't exist in the form that it did anymore. 0:10:36.640 --> 0:10:39.440 But you know, at that time, I do remember that, 0:10:40.320 --> 0:10:41.400 you know, there was a lot of debate in the 0:10:41.400 --> 0:10:44.640 bank and banking circles about which bank was really, you know, 0:10:44.880 --> 0:10:47.320 really leading the IPO. And I think if you talk 0:10:47.320 --> 0:10:49.760 to people who are involved in that transaction, Credit Swiss 0:10:49.760 --> 0:10:53.000 wasn't necessarily the bank that did the bulk of the work. 0:10:53.080 --> 0:10:56.920 But you know, what we'll actually see. What we'll see 0:10:56.920 --> 0:11:00.959 here is that what we're expecting. I think what is 0:11:01.760 --> 0:11:05.480 rumored is that the top five banks would actually get 0:11:05.760 --> 0:11:09.079 ecoeconomics or similar fees. So you know, there'll be some 0:11:09.120 --> 0:11:11.560 differentiation between the roles that the banks play, but they 0:11:11.559 --> 0:11:14.760 are those top five banks or so we'll likely be 0:11:14.760 --> 0:11:16.960 getting similar fees. And if you go back to Ali 0:11:17.000 --> 0:11:19.679 Barbara in twenty fourteen, the top five or six banks 0:11:19.679 --> 0:11:22.079 did get the same fees, so you know there is 0:11:22.160 --> 0:11:23.520 some parallels with that transaction. 0:11:24.640 --> 0:11:27.600 Again, we are expecting the biggest IPO of all time, 0:11:27.840 --> 0:11:29.960 and those banks are going to get big business from that. 0:11:29.960 --> 0:11:33.800 Bloomberg is Anthony Hughes, thank you very much. Indeed, staying 0:11:33.840 --> 0:11:37.880 with SpaceX. The company is reportedly planning to acquire coding 0:11:37.920 --> 0:11:42.359 startup Cursor just thirty days or within thirty days. 0:11:42.240 --> 0:11:43.960 After its IPO. That's according to sources. 0:11:43.960 --> 0:11:46.640 In April, SpaceX said it reached an agreement giving it 0:11:46.679 --> 0:11:50.120 the right to acquire Cursor for sixty billion dollars later 0:11:50.160 --> 0:11:53.560 this year, alternatively pay a ten billion dollar fee tied 0:11:53.720 --> 0:11:57.640 to the company's partnership. Bloomberg's Rachel Metz has been across this, 0:11:58.040 --> 0:12:01.360 the chaos of it, every twist in turn. I mean, 0:12:01.400 --> 0:12:04.000 it's so interesting, right. We were asking ourselves at the 0:12:04.040 --> 0:12:07.240 time in April, like why is it structured this way? 0:12:07.480 --> 0:12:10.680 And then you break the news last night that actually 0:12:11.000 --> 0:12:13.400 they go public and then there's a race to get 0:12:13.400 --> 0:12:14.800 this transaction done. 0:12:16.080 --> 0:12:16.440 Yeah. 0:12:16.520 --> 0:12:20.840 So this transaction, according to our reporting, is set to 0:12:20.920 --> 0:12:27.560 proceed thirty days after the IPO. So what that doesn't 0:12:27.600 --> 0:12:30.280 mean that it will close necessarily right then. Sometimes there's 0:12:31.160 --> 0:12:34.200 regulatory looking into that happens, and that could take up 0:12:34.240 --> 0:12:36.440 to a few months, but it is set to go 0:12:36.520 --> 0:12:40.319 ahead or expected, I should say, to go ahead around 0:12:40.400 --> 0:12:43.560 that time. And the other thing that we found that 0:12:43.640 --> 0:12:47.360 was interesting is that this ten billion dollar fee we 0:12:47.440 --> 0:12:50.200 knew in the past from past reporting that it was 0:12:50.280 --> 0:12:53.800 essentially a breakup fee if the transaction didn't happen. But 0:12:53.880 --> 0:12:56.520 we also found that it's going to be in all cash, 0:12:56.559 --> 0:12:59.079 it's not going to be in credits for computer or 0:12:59.120 --> 0:12:59.840 something like that. 0:13:00.840 --> 0:13:02.360 There's going to be a section of the blombog tech 0:13:02.400 --> 0:13:04.800 audience with respect that they're going to say, hold on, 0:13:05.520 --> 0:13:11.080 SpaceX is acquiring a coding startup, Cursor, and let's fill 0:13:11.120 --> 0:13:14.600 the gaps for them. SpaceX acquired Xai just before it 0:13:14.640 --> 0:13:18.760 plans to go public. Spacexai is like this bigger entity. 0:13:18.840 --> 0:13:20.480 Where does Cursor fit in. 0:13:21.679 --> 0:13:24.360 Yeah, that's a really good question, and I think part 0:13:24.400 --> 0:13:27.439 of it, as you mentioned, is this combination between SpaceX 0:13:27.480 --> 0:13:28.120 and Xai. 0:13:28.760 --> 0:13:31.359 Xai has a ton of compute. 0:13:31.440 --> 0:13:35.000 Compute is something that Cursor really really needs more of, 0:13:35.800 --> 0:13:38.480 as we saw just the other day, they announced their 0:13:38.559 --> 0:13:41.920 latest model, which is meant to help people with coding, 0:13:42.120 --> 0:13:44.240 as some of its past have done, and it was 0:13:44.280 --> 0:13:48.640 partially trained on Colossus two, which is a new data 0:13:48.679 --> 0:13:52.720 center from Xai. So you're starting to see the companies 0:13:52.760 --> 0:13:56.840 already working together and this sense that they can be 0:13:56.880 --> 0:13:57.960 really helpful to each other. 0:14:01.120 --> 0:14:05.960 What I understand is about people. Something that happened post 0:14:06.120 --> 0:14:09.079 Xai SpaceX integration, a lot of talent left. 0:14:09.679 --> 0:14:12.040 Do you have any sense of how Cursor feels about that? Right? 0:14:12.080 --> 0:14:14.120 There is the wow, we get to work with Elon Musk, 0:14:14.160 --> 0:14:16.280 and there's also the ut, oh we have to work 0:14:16.320 --> 0:14:17.319 for Elon Musk. 0:14:18.240 --> 0:14:19.280 That's a really good question. 0:14:19.440 --> 0:14:21.760 I mean, I think these two companies have been familiar 0:14:21.760 --> 0:14:24.040 with each other for a while that there have been 0:14:24.080 --> 0:14:26.800 a few Cursor people. I believe that I've gone over 0:14:26.840 --> 0:14:29.800 to Xai. So it's going to be interesting to see 0:14:29.800 --> 0:14:33.080 what happens, right. I mean, as we know, as you mentioned, 0:14:33.080 --> 0:14:36.600 a lot of people had left Xai over time, but 0:14:36.720 --> 0:14:39.120 I mean Cursor they feels a really strong team, and 0:14:40.280 --> 0:14:41.440 we'll just have to wait and see. 0:14:42.480 --> 0:14:46.160 Bloomboa's Rachel Matt's top Reporting. Thank you very much. Coming 0:14:46.160 --> 0:14:48.479 out from the program, we're going to speak to AMCA 0:14:48.560 --> 0:14:52.320 CEO Joi Malik after raising a three hundred million dollars 0:14:52.360 --> 0:14:58.200 Series B Unicorn status manufacturing in critical Defense and Aerospace. 0:14:58.240 --> 0:15:16.520 That's next. This is Bloomberg Tech. Let's take a look 0:15:16.520 --> 0:15:20.240 at today's big number. Eight thousand. That's how many employees 0:15:20.360 --> 0:15:23.320 Meta is laying off starting today as part of a 0:15:23.360 --> 0:15:28.480 previously announced restructuring aimed at reducing costs while investing in AI. 0:15:28.560 --> 0:15:31.720 The company began notifying workers around the world this morning. 0:15:32.240 --> 0:15:34.800 Metas engineering and product teams are expected to be the 0:15:34.840 --> 0:15:38.480 most impacted. Meanwhile, remember we told you yesterday about Standard 0:15:38.560 --> 0:15:41.520 Chartered CEO Bill Winter saying his company plans to cut 0:15:41.560 --> 0:15:46.280 staff too, to replace quote lower value human capital with AI. 0:15:46.720 --> 0:15:46.880 Well. 0:15:46.920 --> 0:15:49.440 Those comments received a bit of a backlash online, including 0:15:49.680 --> 0:15:53.960 from former Singapore President Halimi Yakob, calling it disturbing to 0:15:54.040 --> 0:15:57.280 describe workers in such clinical terms. Singapore and Hong Kong 0:15:57.520 --> 0:16:00.960 serve as the primary hubs for Standard CHARTSOBAL operations. That's 0:16:01.000 --> 0:16:04.120 all prompted the CEO to reassure staff in a memo 0:16:04.200 --> 0:16:07.600 seen by Bloomberg, Winters is striking a more empathetic tone 0:16:07.640 --> 0:16:13.960 and emphasizing the bank's commitment to transitioning its workforce really 0:16:14.000 --> 0:16:17.440 well read Today on Bloomberg, AMKA has announced a three 0:16:17.520 --> 0:16:21.400 hundred million Series B, valuing the company the more than 0:16:21.440 --> 0:16:24.520 a billion dollars. The company offers an integrated platform to 0:16:24.640 --> 0:16:29.720 rapidly develop and manufacture critical aerospace and defense of components, 0:16:29.800 --> 0:16:33.640 joining us as AMCA CEO J Malik in the private markets, 0:16:33.720 --> 0:16:36.600 this space is alive and well, right, we've talked so 0:16:36.760 --> 0:16:42.240 much about reindustrializing America. Help me understand what AMKA is. 0:16:42.320 --> 0:16:45.640 You know, it sounds like contract manufacturing for the industries 0:16:45.960 --> 0:16:50.040 defense technology, aerospace that are a forefront of what's happening 0:16:50.080 --> 0:16:50.480 right now. 0:16:51.160 --> 0:16:54.680 Absolutely, So what AMCA is actually doing is we're developing 0:16:55.520 --> 0:17:01.000 and then manufacturing critical components, not just contract manufacturing, for 0:17:01.280 --> 0:17:05.560 critical readiness and production gaps that our customers have. And 0:17:05.640 --> 0:17:08.600 so typically these components there's only a single source for 0:17:08.680 --> 0:17:13.040 in the country, unlike other contract manufacturing categories, and our 0:17:13.080 --> 0:17:17.840 business designs these components, qualifies them rapidly and then manufactures them. 0:17:17.840 --> 0:17:19.160 So it's a little bit different. 0:17:19.000 --> 0:17:21.879 Than your typical contract manufacturing business, which is, you know, 0:17:21.960 --> 0:17:27.160 just a machine shop you're looking to produce at scale. 0:17:26.720 --> 0:17:30.600 Jay case study Why harness right, That's something we talked 0:17:30.640 --> 0:17:33.879 about a lot in this program. Heavy dependence in that 0:17:34.040 --> 0:17:38.399 case study on China. Give me a similar product, a 0:17:38.480 --> 0:17:42.280 similar sort of component that you are solving for where 0:17:42.320 --> 0:17:45.600 there might be a reliance on an external country to 0:17:45.920 --> 0:17:46.280 get it. 0:17:47.280 --> 0:17:49.679 Yeah, you know. I'll give you two examples. 0:17:50.119 --> 0:17:52.360 One example are the sensors that we put onto our 0:17:52.480 --> 0:17:54.440 you know, put on put onto almost all of our industrial 0:17:54.440 --> 0:17:57.800 platforms today. A lot of those sensors are sourced to 0:17:57.880 --> 0:18:01.480 sensing elements are sourced from off or you know, offshore 0:18:01.600 --> 0:18:04.000 companies and nations allied with them. 0:18:04.800 --> 0:18:04.960 You know. 0:18:05.119 --> 0:18:05.840 That's one example. 0:18:05.840 --> 0:18:08.800 Another example would be, you know, capacitors in other passive 0:18:08.800 --> 0:18:12.679 electronic electrical components. These are often components that have been 0:18:12.680 --> 0:18:16.400 offshore you know, to Asian countries over the past three decades. 0:18:16.600 --> 0:18:18.320 In America today has. 0:18:18.200 --> 0:18:20.840 A very very lowd windling supply base for these types 0:18:20.840 --> 0:18:23.639 of entergy components. And so that those are two examples 0:18:24.040 --> 0:18:26.679 of areas where we are designing in the country and 0:18:26.680 --> 0:18:27.879 then manufacturing into the country. 0:18:27.880 --> 0:18:30.080 Those components for the warfighter. 0:18:31.400 --> 0:18:33.600 Jay, just have a few rapid fire questions if I may, 0:18:33.840 --> 0:18:35.520 what years have you found this company? 0:18:36.960 --> 0:18:40.280 Twenty twenty four in November twenty. 0:18:40.000 --> 0:18:42.320 Twenty four in November? And is this one billion dollar 0:18:42.400 --> 0:18:44.240 valuation post money or pre money? 0:18:44.800 --> 0:18:46.800 That is post money? 0:18:46.880 --> 0:18:51.560 So in about eighteen months you've founded, launched, and scaled 0:18:51.640 --> 0:18:54.400 up this company and got to a billion dollar valuation. 0:18:55.520 --> 0:18:57.880 What should I infer from that? The pace at which 0:18:57.920 --> 0:18:58.480 you've done. 0:18:58.280 --> 0:19:00.920 That, you should infer that you know, we're living at 0:19:01.280 --> 0:19:05.159 I would say the largest gap between what America needs 0:19:05.480 --> 0:19:06.639 and what America. 0:19:06.320 --> 0:19:08.680 Is able to produce in generations. 0:19:08.720 --> 0:19:11.879 It's a generational opportunity for folks who are looking to 0:19:11.920 --> 0:19:14.160 build in this country. I think over the next five 0:19:14.160 --> 0:19:16.240 to ten years you will see a lot more manufacturing 0:19:16.240 --> 0:19:20.240 companies in America building for America. And we're just, you know, 0:19:20.280 --> 0:19:23.320 sitting at the forefront of this. I think immense growth 0:19:23.400 --> 0:19:25.879 growth curve that's that's coming and will and it is 0:19:25.920 --> 0:19:29.280 already happening in the nation, both for defense and aerospace 0:19:29.320 --> 0:19:33.320 customers as well as in other categories like AI, infrastructure, energy, robotics, 0:19:33.320 --> 0:19:33.720 et cetera. 0:19:34.560 --> 0:19:35.720 Jay, who are your customers? 0:19:37.359 --> 0:19:41.159 You know, do the sensitive nature of you know, of 0:19:41.200 --> 0:19:43.040 the work that we do. I can you know, disclose 0:19:43.280 --> 0:19:45.680 any specific names, you know, but some of the names 0:19:45.680 --> 0:19:47.720 that that we are we have been able to disclose 0:19:47.720 --> 0:19:51.560 are you know, Boeing, Airbus, Honeywell, Lockheed Martin and then 0:19:51.800 --> 0:19:55.560 you know certain branches of the military. But you know, 0:19:55.640 --> 0:19:57.840 all of our components today that go on to platforms. 0:19:57.880 --> 0:20:00.960 We all know about seven thirty seven, MAS, Triple seven, 0:20:01.160 --> 0:20:05.239 F thirty five's, F fifteen's, F sixteen's, you know our 0:20:05.840 --> 0:20:09.320 tanks and m K one abrams. So there's there's plenty 0:20:09.320 --> 0:20:12.520 of plenty of your different platforms that we're on today 0:20:12.960 --> 0:20:14.320 that the country actively uses. 0:20:15.520 --> 0:20:18.800 You know, it's interesting we've we've probably spent a lot 0:20:18.800 --> 0:20:22.000 of time understanding some of the problems that those customers 0:20:22.040 --> 0:20:25.240 that you've just outlined have, but probably of ancor it's 0:20:25.240 --> 0:20:27.680 better to talk about what your constraints are, where the 0:20:27.720 --> 0:20:29.960 bottlenecks are for you and your own supply chain. 0:20:31.680 --> 0:20:34.600 You know, in our own supply chain, there are certainly, 0:20:34.680 --> 0:20:37.320 you know, big gaps right now at the sort of 0:20:37.400 --> 0:20:41.200 like infrastructure level, like I mentioned, you know, for sensors, 0:20:41.240 --> 0:20:44.200 for example, you know, we need sensing elements these are 0:20:44.320 --> 0:20:48.040 highly precise, you know, elements that go into sensors that 0:20:48.400 --> 0:20:50.639 the country doesn't have a lot of suppliers for. So 0:20:50.680 --> 0:20:52.800 in those cases, you know, we're taking a new approach. 0:20:52.840 --> 0:20:56.800 We're vertically integrating a lot of our you know, our supply, 0:20:57.280 --> 0:20:59.840