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Speaker 1: Bloomberg Audio Studios, podcasts, radio news from the heart of

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Speaker 1: where innovation, money and power collide in Silicon Valley and beyond.

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Speaker 1: This is Bloomberg Technology with Caroline Hyde.

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Speaker 2: And Ed Ludlow.

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Speaker 3: Live from New York and San Francisco. This is Bloomberg

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Speaker 3: Technology Coming up. Tesla is first up for the MAGS

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Speaker 3: seven Tech earnings. Can Elon Musk inject some excitement back

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Speaker 3: into the company.

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Speaker 4: Plus Verizon sinks as it loses more mobile phone subscribers

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Speaker 4: than expected in the face of competition and cuts across government.

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Speaker 3: And data center drama. Amazon confirms strong AWS demand. That's

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Speaker 3: as analysts call out concerns in cloud computing leases. But

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Speaker 3: first we check in on these markets, and we've got

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Speaker 3: a bounce back after yesterday's sell off. We almost make

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Speaker 3: up for it today up two point four percent. Let's

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Speaker 3: call it on the Nasdaq one hundred. Look, there's still

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Speaker 3: anxiety as we head into earnings, and many people are

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Speaker 3: buying out options to protect any downside moves in some

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Speaker 3: of these MAGS seven names. But we are managing to

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Speaker 3: shake off some of yesterday's sell off, and indeed we're

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Speaker 3: still worrying about the future of j Powell, but for

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Speaker 3: now tentative buying. I'm looking at Bitcoin on the up

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Speaker 3: and up ninety thousand now many feeling that this is

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Speaker 3: becoming to trade more like gold than it has been

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Speaker 3: tech stocks. That decoupling pushes the way from maybe ninety

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Speaker 3: two to ninety four thousand to be hit in terms

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Speaker 3: of a price point end. But what are you digging

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Speaker 3: in on the micro Tesla?

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Speaker 4: And it's one of the many names that are up

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Speaker 4: in the session, but over the course of twenty twenty

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Speaker 4: five so far is down more than forty percent year

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Speaker 4: to date. It is the worst performing of the mag

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Speaker 4: seven so far this year by far, almost double the decline.

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Speaker 4: And what you see in some of the other names,

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Speaker 4: including in video for example, earnings are after the well.

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Speaker 4: And as much as people will talk about fundamentals and

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Speaker 4: the fact that in the first three months of this

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Speaker 4: year deliveries were at their lowest level for almost three years,

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Speaker 4: it is solely about Elon Musk right, his relationship with

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Speaker 4: the administration. How focused is Elon Musk on Tesla relative

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Speaker 4: to all the other companies involved in and his duties

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Speaker 4: in government care.

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Speaker 3: Such a good point, and now let's just dig into

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Speaker 3: Tesla a little bit more the broader implications on tech

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Speaker 3: on tech more for livery megs Zha Day is with us.

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Speaker 3: You've put out some great pieces just looking ahead to earnings.

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Speaker 3: This is a company that trades on vibes more often

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Speaker 3: than fundamentals. Can Elon Musk inject the vibes back in here?

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Speaker 5: I mean that's sort of the main focus right now.

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Speaker 5: And this is not really a new thing for Tesla,

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Speaker 5: right like, it always is really important how Elon Musk

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Speaker 5: feels and kind of how confident or not his sounds

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Speaker 5: on the call, But I feel like this time it's

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Speaker 5: ever more so. And that's because there's like the company

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Speaker 5: right now is sort of in an information air pocket

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Speaker 5: sort of speak people more or less understand the results

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Speaker 5: are not going to be kind of really strong. There

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Speaker 5: are not huge expectations around margins, around sales, around profit.

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Speaker 5: Everything's more or less expected to be disappointing. We also

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Speaker 5: have a big focus on Robotaxi, but we also know

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Speaker 5: that the Robotaxi launch is going to be in Austin

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Speaker 5: in June. So right now, what can you know on

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Speaker 5: mask bring to the table. It really is about whether

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Speaker 5: his focus is going to be moving away from doors

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Speaker 5: and what else he can talk about about the cheaper car. Yeah,

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Speaker 5: it's really about the vibes right now.

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Speaker 4: Lindberg's act today out of New York City, Thank you

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Speaker 4: very much. Meanwhile, Amazon Web Services is putting some of

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Speaker 4: its data center leases on pause. That's according to a

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Speaker 4: Wells Fargo and List note, citing industry sources. Amazon's head

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Speaker 4: of Data Centers pushing back, writing quote, this is routine

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Speaker 4: capacity management and there haven't been any recent fundamental changes

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Speaker 4: in our expansion plans. Fortunately for our customers, they're able

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Speaker 4: to focus on their business and leave these details to us.

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Speaker 4: We called it data center drama at the top. Mnigrafeo

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Speaker 4: is here with the full of picture.

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Speaker 6: What do we know?

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Speaker 2: M right ed.

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Speaker 6: So.

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Speaker 7: Miller was responding to a note that Wells Fargo had

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Speaker 7: put out yesterday that they had spoken to analysts over

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Speaker 7: the weekend who said our industry sources over the weekend

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Speaker 7: who said that AWS had paused a portion of its

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Speaker 7: data center leasing discussions on the co location side, particularly

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Speaker 7: in international markets. Well said that it wasn't clear of

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Speaker 7: the magnitude of the pause, but it's following a similar

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Speaker 7: trend that we've already seen from Microsoft that these two

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Speaker 7: companies are pulling back on spending on those data centers.

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Speaker 8: And the reason why investors care about.

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Speaker 3: This is because they want to watch to get a.

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Speaker 7: Kind of read on consumer demand how these companies are

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Speaker 7: thinking about demand for cloud and AI. You can get

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Speaker 7: a read on that if these companies are spending more

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Speaker 7: on data centers now. Wells Fargo also said that it's

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Speaker 7: not clear whether AWS slowing some leases is an area

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Speaker 7: of concern or just the natural ebbs and flows of

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Speaker 7: hyper scale activity. And we did see Miller pull up,

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Speaker 7: I guess pushing back on those comments today, saying that

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Speaker 7: the demand here is still strong. The shares dropped yesterday

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Speaker 7: in Amazon, but they are rebounding and actually outperforming the

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Speaker 7: nabscack right now, but still down very much year to

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Speaker 7: date ed as.

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Speaker 3: We can see, off by twenty one percent. Emily Graffeo

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Speaker 3: with all things Amazon, we thank you. Look, let's get

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Speaker 3: you a broader a wider impact of TARIS onto the

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Speaker 3: tech sector and what we think about AI demand. Martin

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Speaker 3: Orton's with us in Power, Chief investment strategist. Look, let's

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Speaker 3: take your case for the moment as to the bounce

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Speaker 3: back on the day Marta, are people really putting any

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Speaker 3: new money to work or is this more protecting on

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Speaker 3: the downside.

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Speaker 9: Well, it is kind of interesting because there has been

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Speaker 9: reports that while we initially saw that big by the

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Speaker 9: dip movement come back and play in the wake of

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Speaker 9: the Liberation Day, in the wake of April second, we

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Speaker 9: have seen a little bit more of a cautious tone

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Speaker 9: more recently, and that relates to hedging activity and the like.

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Speaker 9: I think when we're taking a look at the environment

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Speaker 9: today and we're thinking about how this terriff environment compares

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Speaker 9: to other periods of uncertainty like COVID, this has something

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Speaker 9: that at least seems to have a little bit more

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Speaker 9: legs to it, a little bit more kind of prolonged uncertainty,

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Speaker 9: and I think that can at least shake some of

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Speaker 9: the weak buyers off that decision tree in the sense

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Speaker 9: that they're not necessarily going to move necessarily as quickly

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Speaker 9: as they had into this market. But on the positive side,

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Speaker 9: I think we are seeing valuations improve and so that

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Speaker 9: would suggest to me that while you know, we could

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Speaker 9: see uncertainty persists for a while, at least there's a

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Speaker 9: bit more margin of safety baked into prices.

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Speaker 4: We were showing at the top of the program Tesla's

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Speaker 4: year to date performance, Amazon's year to date performance. It

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Speaker 4: sounds like you're a bit more comfortable with where things

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Speaker 4: sit from evaluation perspective, at least, even if the leaders

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Speaker 4: of those companies can't quantify for us or tell us

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Speaker 4: what's going to happen next.

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Speaker 6: With Tariff's where you're bringing.

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Speaker 9: Up that juxtas position where we're looking to earnings and

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Speaker 9: to management to give us certainty, but they might not

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Speaker 9: have it at these early days when we're looking at

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Speaker 9: this terrafor and yet at the same time prices are

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Speaker 9: pulling back and giving us that margin of safety. So

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Speaker 9: you know, if we're looking at the start of the

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Speaker 9: year December twenty twenty four, those valuations for the market

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Speaker 9: at large and technology in particular the mag seven were very,

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Speaker 9: very stretched. In fact, if you're looking at it on

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Speaker 9: a historical basis, they're in the ninth or tenth decile

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Speaker 9: of their own histories. And yet as we roll forward

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Speaker 9: to today and we look at the impact from deep

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Speaker 9: seek and the cell off we saw in January February,

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Speaker 9: and then the continued volatility from tariffs, we're looking at

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Speaker 9: valuations that are a lot more approachable, not necessarily cheap,

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Speaker 9: but more in line with historical levels. So for an

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Speaker 9: investor who has been conservatively positioned, has been on the sidelines,

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Speaker 9: now may be a time to edge in with the

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Speaker 9: understanding that this uncertainty could persist for quite some time.

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Speaker 3: That has been some certainty. Voice five leaders over at

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Speaker 3: AWS trying to push back on this narrative that maybe

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Speaker 3: they're curtailing their leases for data centers, but still it

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Speaker 3: just builds into this worry about whether AI demand, AI

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Speaker 3: use is really there to the extent we thought, Marta,

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Speaker 3: give us your read on data centers on the AI

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Speaker 3: trade here.

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Speaker 9: Well, it's interesting because even before we enter this macroeconomic

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Speaker 9: uncertainty period, we have uncertainty around AI. We saw the

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Speaker 9: big spend, we saw the big numbers, we saw the

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Speaker 9: enthusiasm from the mag seven, from tech leaders, and yet

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Speaker 9: we were still looking for that return on investment and

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Speaker 9: that continues today. So it's as though the narrative hasn't

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Speaker 9: really shifted. We're still looking for those sparks, those hopes,

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Speaker 9: and I think we're going to have investors on the

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Speaker 9: edge of their seats as they're looking at earnings this

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Speaker 9: quarter to see if there's any sort of revelation there.

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Speaker 9: But so far there hasn't been a whole lot of

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Speaker 9: new information. Maybe some green shoots when we look at

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Speaker 9: how some of these companies had been able to monetize

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Speaker 9: on the margin, but still those color apps and massive

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Speaker 9: use case across the economy, it continues to remain a

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Speaker 9: little bit further out. So I think this is, you know,

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Speaker 9: yet one more uncertainty that we're going to have to

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Speaker 9: deal with in this quarter in the coming months.

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Speaker 4: We so, I keep hearing from leaders in the semiconductor

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Speaker 4: industry that they are highly confident capital expenditures will rise

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Speaker 4: again this year, and they'll rise by more than they

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Speaker 4: did last year, and next year they will rise by

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Speaker 4: more than they.

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Speaker 6: Do in twenty twenty five.

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Speaker 4: But what happens if we get to the key earning

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Speaker 4: states this week, next week, and the week after and

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Speaker 4: there's no guidance issued at all, they just say we

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Speaker 4: can't give you the information. What would that do for

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Speaker 4: the technology investors' confidence?

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Speaker 9: Well, you know, it's kind of an interesting question. I

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Speaker 9: think it's a very relevant one because we've already seen

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Speaker 9: that in earnings a bit so far, this season. Early

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Speaker 9: in this season, we've seen different companies say, hey, we're

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Speaker 9: going to give you a few different scenarios, or we

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Speaker 9: can't reconfirm our guidance, or we just don't have a

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Speaker 9: great great deal of clarity on how the coming months

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Speaker 9: will unfold. And so I think that is a possibility

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Speaker 9: that we have to plan for as investors that while

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Speaker 9: we're looking for earning season to provide us that clarity

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Speaker 9: on how tariffs are impacting businesses, we simply might not

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Speaker 9: have it. Liberation Day was only a few weeks ago.

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Speaker 9: The scale of the tariffs are changing in real time,

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Speaker 9: so it's a very hard time for companies to truly

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Speaker 9: understand how they're going to position and how they might

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Speaker 9: respond to this environment. So I think what a lot

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Speaker 9: of companies would do. I would imagine, especially some of

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Speaker 9: these companies with a longer term orientation when it comes

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Speaker 9: to AI, is they're going to say, hey, we see

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Speaker 9: this long term, massive opportunity that is in front of us.

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Speaker 9: We know there's going to be kind of the management

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Speaker 9: of it as we deal with macroeconomic uncertainty in the

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Speaker 9: here and now, but we're not going to lose sight

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Speaker 9: of our long term goal of you know, what we

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Speaker 9: can do with AI and making it this world dominant technology.

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Speaker 9: So I think there's going to be some kind of

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Speaker 9: time horizon management that we see with these earnings. But

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Speaker 9: as investors, we might be weathering more volatility without greater

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Speaker 9: information in the here and now, just the tech sector.

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Speaker 3: Whether this uncertainty around Powell better or worse than other industries.

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Speaker 9: You know, that's a great question, you know when I

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Speaker 9: think about that, that can you know, that added dynamic

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Speaker 9: to the environment that we're in.

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Speaker 8: I think that's.

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Speaker 9: Something that will affect sectors broadly and affect asset classes broadly.

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Speaker 9: If we have some sort of prolonged, deepening uncertainty over

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Speaker 9: the power to replace you know, a FED chairman and

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Speaker 9: maybe more politicize the FED. I don't think there's a

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Speaker 9: whole lot of places to hide there. Maybe that's something

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Speaker 9: you know, some of the enthusiasm around gold, maybe there's

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Speaker 9: some enthusiasm around cash. But when we think about the

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Speaker 9: equity sectors, that seems to be kind of a something

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Speaker 9: that kind of blankets the equity sectors broadly in terms

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Speaker 9: of impact.

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Speaker 3: Oh, Martha, there's been excitement around bitcoin.

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Speaker 8: Have you been.

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Speaker 3: Asking or indeed in discussing with any of your clients

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Speaker 3: about more exposure into crypto.

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Speaker 9: You know, it's so interesting. I had a question yesterday

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Speaker 9: about crypto and bitcoin. I think there's a real enthusiasm

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Speaker 9: for that trade. Were speaking about the numbers a bit

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Speaker 9: earlier here that decoupling from technology moving a bit more

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Speaker 9: toward gold. Personally speaking, I find bitcoin a difficult asset

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Speaker 9: class to necessarily predict its future movements. One of the

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Speaker 9: troubles with cryptocurrency broadly is knowing what that fair value prices,

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Speaker 9: which can help kind of determine overvaluation, undervaluation future movements.

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Speaker 9: And while there's certainly utility and enthusiasm around it, predicting

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Speaker 9: its behavior is a bit.

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Speaker 3: More difficult now.

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Speaker 9: Maybe conversations around Powell and to social posts give bitcoin

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Speaker 9: a little bit more of a shiny look when we're

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Speaker 9: thinking about volatility on monetary policy. But I do think

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Speaker 9: that's one of the asset classes that has that unpredictable

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Speaker 9: flavor that makes it a little bit more difficult to handicap.

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Speaker 4: What bitcoin and some areas of the technology industry have

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Speaker 4: in common, for example, the manufacturing of chips or electronics,

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Speaker 4: is that the administration have policies for it, right, they

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Speaker 4: have people that Trump is brought in to be zas

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Speaker 4: I'm thinking about David Sachs. If you're an investor and

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Speaker 4: you're thinking which areas or corners of the tech market

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Speaker 4: should I go to, why don't you just go to

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Speaker 4: the ones that the president keeps talking about.

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Speaker 8: I mean, that's a great point.

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Speaker 9: If we're thinking about twenty twenty five and what has

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Speaker 9: driven market action in twenty twenty five, It's been fiscal policy,

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Speaker 9: It's been what's happening in the Trump administration and what's

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Speaker 9: in favor with the Trump administration and what's out of

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Speaker 9: favor with the Trump administration. So the extent that that

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Speaker 9: is that marginal push for how asset classes behave, then

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Speaker 9: I think there's there's good reason to have enthusiasm around

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Speaker 9: something like technology, which has you know, especially from an

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Speaker 9: AI perspective, a lot of Trump administration enthusiasm is to

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Speaker 9: building out the US as as a superpower there and

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Speaker 9: then to your point, around crypto and making that a

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Speaker 9: more fairly or friendly regulated area. But you know the

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Speaker 9: question is is that already in the price is that

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Speaker 9: enthusiasm already den at least as it comes to.

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Speaker 4: Cryptel, Martin Norton, Bempare great conversation, Thank you very much, joining.

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Speaker 10: Us time now for talking tech and first up.

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Speaker 3: Boeing It's agreed to sell off its digital flight navigation

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Speaker 3: unit to Toma Bravo in a ten point six billion

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Speaker 3: dollar cash deal. It's the latest move by the company

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Speaker 3: to lower its fifty eight billion dollar debt load.

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Speaker 8: Now the deal.

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Speaker 3: Involves the Japesson business and its subsidiaries. I will allow

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Speaker 3: Boeing to continue capturing data for maintenance and repairs. Plus

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Speaker 3: an increasing rivalry between China's jd dot Com and mat One.

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Speaker 3: Look at sent Chez tumbling in Hong Kong, training falling

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Speaker 3: by as much as eight percent. This is his investors

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Speaker 3: begin to worry about a hit in profitability for the competition.

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Speaker 3: Now both stocks have fallen more than twenty five percent

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Speaker 3: from their highs in March, underperforming the Hangsang Tech Index

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Speaker 3: and more Chinese tech companies rashally eyeing potential usipos. Beijing

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Speaker 3: Smart Walnut could seek to raise a one hundred million

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Speaker 3: dollars alongside other firms and similar goals like Shenzhen Cloudsky

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Speaker 3: and Zongie Group. That's according to sources, all of this

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Speaker 3: is actually despite the US market turmoil and rising geopolitical

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Speaker 3: tensions between Washington and Beijing.

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Speaker 6: Ed.

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Speaker 4: Yeah, let's stick with this story and bring in Bloomberg's

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Speaker 4: Henry Ren out London. The thing about this, right that

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Speaker 4: we understand them resources is these are US listings under

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Speaker 4: consideration by Chinese technology companies, not firm commitments. They might

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Speaker 4: not have to happen, but we do have some size

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Speaker 4: and scope on what they try to raise. And it's

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Speaker 4: interesting that some of them are our data center infrastructure

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Speaker 4: names as well.

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Speaker 2: Henry.

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Speaker 8: Yeah.

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Speaker 11: Indeed, so we're seeing, actually, despite all those trade tensions,

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Speaker 11: we're seeing more Chinese companies actually more willing to list

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Speaker 11: in the US in recent months. That's arguably after the

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Speaker 11: recent Deep Seats tech breakthrough in China and arising investors

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Speaker 11: sentiment toward those Chinese tech companies.

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Speaker 8: And it's not necessarily just tech.

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Speaker 11: We mentioned the smart oneut which is a firm that's

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Speaker 11: specializing in coaching young kids of doing computer programming, and

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Speaker 11: not just about infrastructure tech companies, software companies as well,

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Speaker 11: and we've also just last week saw Charji, which is

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Speaker 11: a famous tea chain China also pursued US listing and

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Speaker 11: this deal is actually bigger, with four hundred million US

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Speaker 11: dollars being raised in an IPO price at the upper

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Speaker 11: bound of the price range in the last week, so

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Speaker 11: we can see that there actually has been a revival

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Speaker 11: investor interest into Chinese names after the Deep Seek's breakthrough.

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Speaker 3: How does the Chinese government feel about that, the tapping

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Speaker 3: of liquidity in the United States.

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Speaker 11: Yeah, I think that's an important goal of Chinese companies

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Speaker 11: despite all those trade tensions between US and China, protecting

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Speaker 11: those private companies is one of the key goals of

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Speaker 11: the government. That's actually a bit different from the things

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Speaker 11: that we've been seeing over the past two years during

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Speaker 11: the tech crackdown phase of the regulation crackdown.

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Speaker 8: And so expecting more to come.

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Speaker 11: Actually, but one thing that we need to monitor closely

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Speaker 11: is whether the US sanctions on those Chinese firms is

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Speaker 11: on the rise.

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Speaker 4: Henry Caroy brought us the moves over nine in Hong

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Speaker 4: Kong on JD in May twe what's the story in

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Speaker 4: the competition between those two.

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Speaker 11: Yeah, that's actually a very interesting one because this has

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Speaker 11: been a story that we've been.

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Speaker 8: Tracked for the past few months.

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Speaker 11: But the tension, the excalation between the competition of those

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Speaker 11: two Chinese tech companies is really on the rise in

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Speaker 11: the past few days, because there have been some several

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Speaker 11: things over the weekend, including JD saying that it's planning

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Speaker 11: to hire about one hundred thousand more delivery men in China.

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Speaker 11: JD's funder, Richard Liu, appeared in a press story that

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Speaker 11: he's delivering meal orders to clients by himself. JD signed

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Speaker 11: a deal with Starbucks in China to delivery to deliver

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Speaker 11: coffee for the coffee chain.

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Speaker 8: And at the end and these two.

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Speaker 11: Companies JD and may twey came, they were involved in

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Speaker 11: a heated exchange on Chinese social media, with JD saying

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Speaker 11: that may twe is forbidding its own own drivers of

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Speaker 11: delivering JD's orders, while made One is saying that it's

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Speaker 11: actually not the case. So lots of developments recently and

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Speaker 11: competition is definitely on the rice in China's food delivery arena.

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Speaker 4: Bloomberg's Henry Renn, thank you very much. Now coming out,

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Speaker 4: Verizon sees mobile phone subscribers full in the first quarter.

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Speaker 4: We'll discuss why Telecoms Giant is pointing to moves by

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Speaker 4: the Trump administration as the reason snacks.

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Speaker 6: This is Bloomberg Technology.

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Speaker 4: Verizon shares flat after the company reported a larger than

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Speaker 4: expected decline in mobile phone subscribers in the first quart

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Speaker 4: of Verizon is the first of the big three US

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Speaker 4: telecon companies to report first quarter results. Let's get the

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Speaker 4: details with Bloomberg's Kelsey Griffiths.

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Speaker 9: What do we know.

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Speaker 12: Yeah, so Verizon reported their first quarter earnings today and

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Speaker 12: they lost a lot of subscribers. It was more than

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Speaker 12: a Wall Street analysts we're expecting, and they're attributing that

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Speaker 12: to a couple of factors. One of them is just

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Speaker 12: a drop in seasonal promotions and that very tight competition

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Speaker 12: we're seen in the mobile market. However, there is also

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Speaker 12: another factor, which is a lot of downsizing in the

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Speaker 12: federal government, and that's something that Verizon CEO Hans Vesberg

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Speaker 12: actually cited on a call with analysts today.

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Speaker 3: Broad Bands still going strong though, Kelsey Griffiths, we thank

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Speaker 3: you very much for the latest in terms of earnings.

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Speaker 3: Let's go to another tech giant, which has earnings later

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Speaker 3: in the week, but right now, Alphabet is back in

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Speaker 3: court today fighting to stop the government's push to break

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Speaker 3: up Google. It follows last year's ruling that the company

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Speaker 3: has a monopoly oversearch. Bloombox Sarah Forden joins us for

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Speaker 3: more really interesting details coming out when it regards to

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Speaker 3: the Generative AI, the Gemini offering, and the payments being

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Speaker 3: made to Samsung for example.

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Speaker 13: Yes, so the government is actually not only concerned about

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Speaker 13: Google's monopoly of research, but they're also alleging that the

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Speaker 13: AI capacity has helped it to enshrine its monopoly of research.

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Speaker 13: So we had testimony yesterday and today from a Google

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Speaker 13: executive talking about how they paid Samsung inordinate amounts of

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Speaker 13: money to pre install their Gemini AI product on Samsung phones.

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Speaker 3: Meanwhile, the pushback is that the extreme remedies being considered

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Speaker 3: are selling off of chrome or access to their data

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Speaker 3: to rivals. Well, that seems to be the narrative coming

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Speaker 3: from Google. When do we expect to hear from some

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Speaker 3: of the key leaders of the business.

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Speaker 13: So this trial is expected to last three weeks, so

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Speaker 13: we're going to have at least the rest of this

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Speaker 13: week and probably a good portion of next week with

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Speaker 13: the government presenting its case for breaking up Google. We

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Speaker 13: are not going to see probably the Google side of

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Speaker 13: the case until the end of that process, so could

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Speaker 13: be like a couple of weeks away, sir.

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Speaker 4: What's extreme about this case is that the government wants

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Speaker 4: all four of the sort of remedies as a bucket

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Speaker 4: combined together, and Google will argue that is too severe.

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Speaker 4: It's unprecedented to an extent. How do you see this

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Speaker 4: one going up. It's a multi week's trial, but it's

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Speaker 4: going to come close.

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Speaker 13: Yeah, So this is really what the judge is going

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Speaker 13: to have to weigh, and of course it is very

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Speaker 13: complex and he's you know, getting you know, technical testimony

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Speaker 13: from the experts on this. The government is saying that

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Speaker 13: Google is basically kind of controlling the gateway to the

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Speaker 13: Internet and it needs to open it up to allow

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Speaker 13: the potential for other browsers to compete. So we could

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Speaker 13: have other search engines that could be just as attractive

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Speaker 13: to consumers to users as as Google's currently is. Google

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Speaker 13: is saying, you know, these remedies are are not really

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Speaker 13: addressed in a problem. They want to do something much

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Speaker 13: more limited, maybe focusing on you know, sharing browser installs,

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Speaker 13: so you would have a drop down menu where you

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Speaker 13: could click on other browsers if you if you wanted to,

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Speaker 13: and then they would propose a revenue sharing arrangement.

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Speaker 3: Bloomberg Sarah fordan great breakdown, We thank you, welcome back

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Speaker 3: to Bloomberg Technology, and Caroline Hide.

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Speaker 6: In New York and I medal'd low in San Francisco.

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Speaker 4: Let's take a look at the markets, and the story

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Speaker 4: really is big tech leading US higher. But then as

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Speaker 4: that one hundred is up two and a half percent,

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Speaker 4: it fell two and a half percent in yesterday's session

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Speaker 4: or Monday session, so we are sort of to an

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Speaker 4: extent treading water as big tech earning start in earnest.

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Speaker 2: Bitcoin is interesting.

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Speaker 4: It's up twenty percent from an April seventh low, and

442
00:22:41,400 --> 00:22:43,560
Speaker 4: what the market commentators are saying is that in this

443
00:22:43,640 --> 00:22:47,320
Speaker 4: time of uncertainty, it is behaving more like gold is

444
00:22:47,359 --> 00:22:50,760
Speaker 4: an asset class when you're riding the uncertay of the voluntility.

445
00:22:50,800 --> 00:22:53,439
Speaker 4: But we're now above ninety one thousand US dollars per token.

446
00:22:53,680 --> 00:22:55,600
Speaker 4: There's two other single names that I'm looking at Cara

447
00:22:55,720 --> 00:22:58,040
Speaker 4: One is Netflix. It's up for a third straight session

448
00:22:58,400 --> 00:23:00,800
Speaker 4: since it's earning sprint where it hit record profit in

449
00:23:00,840 --> 00:23:04,000
Speaker 4: the quarter. It no longer issues that subscriber number. But

450
00:23:04,080 --> 00:23:06,080
Speaker 4: the stock is also at an all time high, up

451
00:23:06,160 --> 00:23:08,040
Speaker 4: seven percent in the session at one point of session

452
00:23:08,240 --> 00:23:10,760
Speaker 4: up seven point eight percent. A lot of momentum there,

453
00:23:11,160 --> 00:23:13,879
Speaker 4: and then Tesla we're up four point six percent. But again,

454
00:23:14,160 --> 00:23:16,920
Speaker 4: you're about to tell us why one single session a

455
00:23:17,000 --> 00:23:19,000
Speaker 4: market does not make because it might be up almost

456
00:23:19,000 --> 00:23:21,320
Speaker 4: five percent now, but twenty twenty five is not being

457
00:23:21,359 --> 00:23:22,040
Speaker 4: kind to Tesla.

458
00:23:22,359 --> 00:23:25,840
Speaker 3: So true, certainly we're expecting their results after the closing

459
00:23:25,840 --> 00:23:29,320
Speaker 3: bell ed amid mounting pressure, whether it's slowing ev demand,

460
00:23:29,359 --> 00:23:31,920
Speaker 3: whether it's rising competition, whether it's questions around growth strategy.

461
00:23:32,000 --> 00:23:34,439
Speaker 3: Not to mention, of course, of the political backlash to

462
00:23:34,440 --> 00:23:36,840
Speaker 3: Elon Musk. But as you point out, ed, let's look

463
00:23:36,880 --> 00:23:40,640
Speaker 3: at the year to date trading off by forty one percent.

464
00:23:41,400 --> 00:23:44,199
Speaker 3: What can we expect what injection of enthusiasm when we're

465
00:23:44,200 --> 00:23:47,280
Speaker 3: going to get from Elon? From these Creatudell joins us Craig.

466
00:23:47,560 --> 00:23:51,719
Speaker 3: I mean, this company doesn't trade on fundamentals. It's already

467
00:23:51,720 --> 00:23:54,840
Speaker 3: trading at seventy eight times future earnings at the moment

468
00:23:54,960 --> 00:23:57,800
Speaker 3: despite the sellof, and often it rides on how much

469
00:23:57,920 --> 00:23:59,159
Speaker 3: enthusiasm Mealon brings.

470
00:24:00,480 --> 00:24:03,560
Speaker 14: Yeah, that's absolutely right, and it may be the case

471
00:24:03,600 --> 00:24:06,280
Speaker 14: that we get a set of numbers from from Tesla

472
00:24:06,359 --> 00:24:08,679
Speaker 14: after the clothes that you know, are as bad as

473
00:24:08,720 --> 00:24:12,359
Speaker 14: we've seen in years, based on how how rough the

474
00:24:12,600 --> 00:24:16,800
Speaker 14: deliveries numbers were that were reported weeks ago. Morgan Stanley

475
00:24:16,920 --> 00:24:20,560
Speaker 14: was out with a report this morning, you know, sort

476
00:24:20,560 --> 00:24:24,080
Speaker 14: of estimating that the automotive gross margins for the company

477
00:24:24,119 --> 00:24:27,520
Speaker 14: excluding regulatory credits may be as bad as we've seen

478
00:24:27,600 --> 00:24:30,560
Speaker 14: in more than a decade. But you know that won't

479
00:24:30,600 --> 00:24:34,720
Speaker 14: necessarily matter if if you know, Musk sort of waves

480
00:24:34,720 --> 00:24:38,280
Speaker 14: some bright shiny objects, because this stock is we've seen

481
00:24:38,320 --> 00:24:41,560
Speaker 14: time and time again that you know, his his rhetoric

482
00:24:41,680 --> 00:24:44,160
Speaker 14: is as is as important as anything.

483
00:24:45,000 --> 00:24:48,520
Speaker 4: There is some particular and specific excitement from the retail

484
00:24:48,520 --> 00:24:52,440
Speaker 4: investor or the Tesla vehicle and stock owner that looked

485
00:24:52,440 --> 00:24:54,720
Speaker 4: at the wording on the IR site, which reads, in

486
00:24:54,720 --> 00:24:57,960
Speaker 4: addition to posting first quarter results, Tesla management will hold

487
00:24:57,960 --> 00:25:01,760
Speaker 4: a live company update and question and answer webcast. A

488
00:25:01,840 --> 00:25:05,000
Speaker 4: company update is being taken to mean we might get

489
00:25:05,000 --> 00:25:07,120
Speaker 4: something more than just commentary on the numbers.

490
00:25:08,680 --> 00:25:11,520
Speaker 14: Yeah, and that's a perfect example out of just you know,

491
00:25:11,880 --> 00:25:14,800
Speaker 14: how little it takes to move these these shares right

492
00:25:14,840 --> 00:25:18,200
Speaker 14: where it may be the case that this is strictly,

493
00:25:18,400 --> 00:25:21,800
Speaker 14: you know, a slight change in language to describe an

494
00:25:21,840 --> 00:25:25,280
Speaker 14: earnings call, and we don't know whether whether that's all

495
00:25:25,320 --> 00:25:27,640
Speaker 14: this is or if there is something you know, sort

496
00:25:27,640 --> 00:25:29,960
Speaker 14: of more up the company's sleeve for after the close.

497
00:25:30,400 --> 00:25:33,199
Speaker 14: You know, the timing is in line with you know,

498
00:25:33,240 --> 00:25:36,159
Speaker 14: when they've passed, how just you know, regular earnings calls.

499
00:25:36,880 --> 00:25:39,399
Speaker 14: In the past, we've heard you know, Musk sort of

500
00:25:39,840 --> 00:25:42,280
Speaker 14: refuse to answer certain questions and say, you know, these

501
00:25:42,320 --> 00:25:44,960
Speaker 14: earnings calls aren't the right form for this. We'll see

502
00:25:45,000 --> 00:25:48,919
Speaker 14: whether he takes a different approach to this conversation post earnings.

503
00:25:48,960 --> 00:25:51,399
Speaker 3: I mean, Craig, timing is everything when it comes to

504
00:25:52,040 --> 00:25:54,280
Speaker 3: how long Enalmusk is going to be doing his special

505
00:25:54,359 --> 00:25:56,320
Speaker 3: job over at the White House. One hundred and thirty

506
00:25:56,400 --> 00:25:59,200
Speaker 3: days is technically what he's actually allowed per year. That'll

507
00:25:59,240 --> 00:26:01,520
Speaker 3: be the end of May.

508
00:26:01,680 --> 00:26:04,159
Speaker 14: Yeah, and I think people are really fixated on this.

509
00:26:04,240 --> 00:26:06,359
Speaker 14: You had Dan Ives just in the last couple of

510
00:26:06,400 --> 00:26:09,359
Speaker 14: days again sort of say that Musk needs to to

511
00:26:09,600 --> 00:26:12,760
Speaker 14: leave Doge and sort of end that chapter. I think

512
00:26:12,920 --> 00:26:15,800
Speaker 14: all of this sort of talking speculation about you know,

513
00:26:15,840 --> 00:26:20,080
Speaker 14: when officially he'll step back. I do wonder whether we'll

514
00:26:20,160 --> 00:26:22,879
Speaker 14: sort of you know, second guests, whether we were putting

515
00:26:22,960 --> 00:26:26,840
Speaker 14: too much, you know, into all that when we've seen,

516
00:26:26,960 --> 00:26:29,960
Speaker 14: we've had every indication that Musk is going to continue

517
00:26:30,000 --> 00:26:33,240
Speaker 14: to play, you know, an outsize role in US politics.

518
00:26:33,720 --> 00:26:36,920
Speaker 14: And you know, even if he does officially step back

519
00:26:36,920 --> 00:26:40,440
Speaker 14: from from Doge, he himself has said and Vice President

520
00:26:40,480 --> 00:26:42,239
Speaker 14: Ja d Vance have said, you know, he's going to

521
00:26:42,280 --> 00:26:45,560
Speaker 14: continue to have a close relationship with the White House.

522
00:26:45,600 --> 00:26:48,800
Speaker 14: And so you know, officially that that chapter might be

523
00:26:48,840 --> 00:26:52,400
Speaker 14: done or or you know, getting close to the final chapters.

524
00:26:53,080 --> 00:26:55,399
Speaker 14: But you know, I would be skeptical that this is

525
00:26:55,440 --> 00:26:58,000
Speaker 14: going to be something that there's a sort of post

526
00:26:58,080 --> 00:26:59,960
Speaker 14: political Elon Musk in our near future.

527
00:27:01,200 --> 00:27:04,000
Speaker 4: Prey Trudell, who leads Auto's coverage around the world, thank

528
00:27:04,000 --> 00:27:04,640
Speaker 4: you very much.

529
00:27:04,720 --> 00:27:05,560
Speaker 2: Let's stick with Tesla.

530
00:27:05,640 --> 00:27:06,200
Speaker 8: Dan Levy.

531
00:27:06,280 --> 00:27:08,760
Speaker 4: Barclays has a price target on the stock of two

532
00:27:08,800 --> 00:27:11,119
Speaker 4: hundred and seventy five dollars. Dan, I'm going to go

533
00:27:11,160 --> 00:27:13,439
Speaker 4: straight to the boiler plate and the footnote in the

534
00:27:13,440 --> 00:27:16,160
Speaker 4: ten K which came out in January and the New Year,

535
00:27:16,480 --> 00:27:19,320
Speaker 4: and Tesla in it talks about how it's highly dependent

536
00:27:19,600 --> 00:27:23,359
Speaker 4: on Elon Musk, and it explains that although he is

537
00:27:23,480 --> 00:27:26,520
Speaker 4: highly active in our management. He does not devote his

538
00:27:26,640 --> 00:27:29,240
Speaker 4: full time and attention to Tesla. They list all the

539
00:27:29,240 --> 00:27:32,200
Speaker 4: other obligations that he has across private companies and now.

540
00:27:32,160 --> 00:27:33,720
Speaker 6: Of course that includes Doge.

541
00:27:33,920 --> 00:27:36,359
Speaker 4: You wrote this morning that a source of potential webside

542
00:27:36,400 --> 00:27:40,040
Speaker 4: for this stock could be a re engaged Musk. Where

543
00:27:40,080 --> 00:27:41,760
Speaker 4: do you want to see him re engage and how

544
00:27:41,760 --> 00:27:43,200
Speaker 4: on earth are you going to measure that based on

545
00:27:43,240 --> 00:27:43,920
Speaker 4: an earnings call?

546
00:27:45,400 --> 00:27:48,159
Speaker 2: Yeah, thanks Head and Caroline for having me.

547
00:27:48,800 --> 00:27:51,240
Speaker 15: I think what we need to see is an Elon

548
00:27:51,440 --> 00:27:56,800
Speaker 15: mask that is increasingly devoting his time, resource and attention

549
00:27:57,080 --> 00:28:00,520
Speaker 15: to Tesla. We know that the key man rich for

550
00:28:00,840 --> 00:28:04,960
Speaker 15: Tesla is very high. Elon is Tesla. Tesla is Elon

551
00:28:05,280 --> 00:28:09,080
Speaker 15: more so than ever. There is not much in the

552
00:28:09,080 --> 00:28:12,760
Speaker 15: way of other sort of key management that's as pronounced,

553
00:28:13,080 --> 00:28:15,200
Speaker 15: and so I think what could go a long way

554
00:28:15,480 --> 00:28:17,919
Speaker 15: for the stock, or what could help the stock is

555
00:28:18,000 --> 00:28:21,080
Speaker 15: Elon musk reminding people that he is there, that he

556
00:28:21,200 --> 00:28:25,639
Speaker 15: is present and is still a very central part of

557
00:28:25,720 --> 00:28:29,080
Speaker 15: the strategy and operations at Tesla.

558
00:28:29,280 --> 00:28:32,560
Speaker 4: Dan, what are automotive gross margins excluding the sale of

559
00:28:32,560 --> 00:28:33,280
Speaker 4: regulatory credit?

560
00:28:33,280 --> 00:28:36,440
Speaker 6: It's going to tell us about Tesla.

561
00:28:37,440 --> 00:28:39,800
Speaker 2: Well, people will tell you two sides of that.

562
00:28:40,800 --> 00:28:43,080
Speaker 15: One side of it is that this is a company

563
00:28:43,120 --> 00:28:46,320
Speaker 15: that has come a long way from where they were

564
00:28:46,360 --> 00:28:49,040
Speaker 15: several years ago. Just to give some context, we were

565
00:28:49,080 --> 00:28:51,760
Speaker 15: at one point three years ago at thirty percent automotive

566
00:28:51,760 --> 00:28:55,000
Speaker 15: gross margins. We're at just more than ten percent for

567
00:28:55,080 --> 00:28:58,520
Speaker 15: this quarter. I think it's a reminder of where the

568
00:28:58,560 --> 00:29:04,120
Speaker 15: automotive business is. At the same time, I think it

569
00:29:04,200 --> 00:29:07,280
Speaker 15: is also a view from some people of Okay, the

570
00:29:07,320 --> 00:29:12,400
Speaker 15: future of Tesla really is in non automotive streams. That's

571
00:29:12,400 --> 00:29:15,480
Speaker 15: where the growth is going to come from, from FSD,

572
00:29:15,760 --> 00:29:19,560
Speaker 15: from optimists, etc. And so that's why you could theoretically

573
00:29:19,640 --> 00:29:23,440
Speaker 15: have a result tonight that is weak. From the fundamentals,

574
00:29:23,680 --> 00:29:26,960
Speaker 15: it's a miss. You get weak gross margins. Potentially there's

575
00:29:27,040 --> 00:29:31,560
Speaker 15: downside on volume for the year. But reiterating that FSD

576
00:29:31,760 --> 00:29:36,000
Speaker 15: driverless date in June, or that opportunity in June, Elon

577
00:29:36,160 --> 00:29:39,360
Speaker 15: re engaging himself is the narrative piece that sort of

578
00:29:39,400 --> 00:29:40,240
Speaker 15: weighs out.

579
00:29:40,000 --> 00:29:40,600
Speaker 2: On all of this.

580
00:29:40,960 --> 00:29:44,160
Speaker 3: Remind us Dan of the business model that comes with

581
00:29:44,360 --> 00:29:49,120
Speaker 3: getting these robotaxis on the road in Austin in June.

582
00:29:50,080 --> 00:29:54,720
Speaker 15: Well, June will be an event that's arguably the easier

583
00:29:54,800 --> 00:29:57,240
Speaker 15: part of it. The business model that you talk about,

584
00:29:57,280 --> 00:30:00,440
Speaker 15: that's the much harder part. It is a very long

585
00:30:00,520 --> 00:30:05,600
Speaker 15: path to monetization with a lot of spend. It won't

586
00:30:05,600 --> 00:30:09,600
Speaker 15: be easy, and then there's obviously a regulatory angle to that.

587
00:30:10,080 --> 00:30:11,760
Speaker 2: But I think Tesla is.

588
00:30:11,760 --> 00:30:13,959
Speaker 15: You know, as far as the stock goes, it is

589
00:30:14,280 --> 00:30:16,800
Speaker 15: more about the narrative than anything.

590
00:30:16,520 --> 00:30:17,800
Speaker 2: Else in our model.

591
00:30:17,840 --> 00:30:21,080
Speaker 15: We think it will take years before this actually shows

592
00:30:21,160 --> 00:30:24,680
Speaker 15: up as a positive any sort. Just a reminder Weaimo,

593
00:30:24,920 --> 00:30:30,920
Speaker 15: which many view as the leader in driverless robotaxi operations

594
00:30:30,920 --> 00:30:33,160
Speaker 15: and really is one of the only ones that are

595
00:30:33,240 --> 00:30:37,800
Speaker 15: still doing it, is still burning a significant amount of

596
00:30:37,800 --> 00:30:40,400
Speaker 15: cash on these operations and on the scaling.

597
00:30:40,440 --> 00:30:41,720
Speaker 2: Scaling isn't easy and.

598
00:30:41,680 --> 00:30:43,520
Speaker 3: They're already on the road in plenty of places.

599
00:30:43,600 --> 00:30:43,800
Speaker 8: Dan.

600
00:30:44,000 --> 00:30:48,120
Speaker 3: Lastly, is there brand damage that is undoable?

601
00:30:48,160 --> 00:30:54,000
Speaker 15: Now undoable is a question mark, but clearly there's been

602
00:30:54,080 --> 00:30:58,960
Speaker 15: some brand damage or some some pressure on sales related

603
00:30:59,000 --> 00:31:04,000
Speaker 15: to Elon Musk's political dealings. I think we've seen that,

604
00:31:04,080 --> 00:31:07,960
Speaker 15: you know Europe especially you know, that's been reported throughout

605
00:31:08,000 --> 00:31:11,760
Speaker 15: the media. I think it remains to be seen how

606
00:31:12,120 --> 00:31:15,840
Speaker 15: how much that actually weighs on sales in the long term.

607
00:31:16,520 --> 00:31:18,960
Speaker 15: Just a reminder that you know, in this environment, you know,

608
00:31:18,960 --> 00:31:23,400
Speaker 15: at least in the US, Tesla is now you know,

609
00:31:24,000 --> 00:31:27,880
Speaker 15: on a relative basis, more affordable. It's certainly one of

610
00:31:27,920 --> 00:31:31,160
Speaker 15: the remaining vehicles on the EV market that's still available

611
00:31:31,200 --> 00:31:35,800
Speaker 15: at a good price tag. And arguably there there's an

612
00:31:35,840 --> 00:31:41,480
Speaker 15: opportunity here with with Tesla having the tariff advantage on

613
00:31:41,520 --> 00:31:45,520
Speaker 15: their side with limited non US content in their vehicles.

614
00:31:45,840 --> 00:31:49,280
Speaker 3: Dan Levy a Barclice, We thank you. Coming up, I'm

615
00:31:49,280 --> 00:31:51,719
Speaker 3: going to speak for the Dana Grayson of Construct Capital.

616
00:31:51,880 --> 00:31:54,800
Speaker 3: This company raises three hundred million dollars in its latest fund.

617
00:31:55,280 --> 00:32:13,160
Speaker 3: This is a three by technology. Construct Capital has announced its

618
00:32:13,200 --> 00:32:17,280
Speaker 3: third fund, raising three hundred million dollars to reimagine industrial

619
00:32:17,320 --> 00:32:20,360
Speaker 3: sectors in the United States. Dana Grayson, as co founder

620
00:32:20,440 --> 00:32:24,120
Speaker 3: and general partner, joins us Now, Dana, three hundred million

621
00:32:24,360 --> 00:32:26,920
Speaker 3: is a lot when you're looking at the seed and

622
00:32:27,320 --> 00:32:30,760
Speaker 3: first injection of money into these sorts of companies. Where

623
00:32:30,800 --> 00:32:32,880
Speaker 3: is this coming from? What al Peace is still interested

624
00:32:32,880 --> 00:32:34,840
Speaker 3: in manufacturing and logistics here in the US.

625
00:32:36,040 --> 00:32:39,239
Speaker 16: Yes, that's a great question. You know, I think what

626
00:32:39,280 --> 00:32:42,280
Speaker 16: we've seen over the past, you know, two decades that

627
00:32:42,320 --> 00:32:44,520
Speaker 16: I've actually been investing in the space, but in particular

628
00:32:44,560 --> 00:32:47,480
Speaker 16: over the past five years, is a ton of renewed

629
00:32:47,520 --> 00:32:51,240
Speaker 16: interest in the space, most importantly, first and foremost from

630
00:32:51,400 --> 00:32:55,440
Speaker 16: entrepreneurs who have built their careers in traditional tech sectors

631
00:32:55,480 --> 00:32:58,400
Speaker 16: over the last twenty years, some more recent than that,

632
00:32:58,560 --> 00:33:03,080
Speaker 16: turning their attention to the industrial spaces from the LP side,

633
00:33:03,200 --> 00:33:06,320
Speaker 16: you know, urlps were very thankful for our strong, stable,

634
00:33:06,480 --> 00:33:12,680
Speaker 16: LP based traditional endowments, foundations, large family offices. They're investing

635
00:33:12,720 --> 00:33:15,920
Speaker 16: for the next ten twenty years. They're really looking at

636
00:33:15,960 --> 00:33:20,080
Speaker 16: long term returns and building new swaths of the public markets,

637
00:33:20,360 --> 00:33:22,680
Speaker 16: and that's where we think a lot of this industrial

638
00:33:22,720 --> 00:33:26,320
Speaker 16: innovation will end up. These tech first industrial companies can

639
00:33:26,400 --> 00:33:30,160
Speaker 16: create a whole new segment of the public markets that

640
00:33:30,280 --> 00:33:31,960
Speaker 16: hasn't really been appreciated today.

641
00:33:32,240 --> 00:33:35,360
Speaker 3: You're based out in Washington. How much more helpful has

642
00:33:35,360 --> 00:33:38,120
Speaker 3: it been to have sort of the winds of change

643
00:33:38,320 --> 00:33:41,080
Speaker 3: over at Washington, sort of being at the back of

644
00:33:41,160 --> 00:33:44,200
Speaker 3: American dynamism. Is it's cool to at least local manufacturing.

645
00:33:44,200 --> 00:33:45,480
Speaker 3: That's what all the towers are about.

646
00:33:46,680 --> 00:33:50,520
Speaker 16: Sure, we think of them as the foundational industries of

647
00:33:50,560 --> 00:33:54,160
Speaker 16: our economy. Again, we think about it on the long term,

648
00:33:54,280 --> 00:33:57,960
Speaker 16: if you look back twenty years, you look at labor arbitrage,

649
00:33:58,080 --> 00:34:00,280
Speaker 16: which was the main toolkit that a lot of US

650
00:34:00,320 --> 00:34:04,760
Speaker 16: corporates use to recover from financial crises, most notably the

651
00:34:04,800 --> 00:34:07,960
Speaker 16: dot com bubble. They sent a lot of jobs offshore

652
00:34:08,080 --> 00:34:12,400
Speaker 16: to save money, and they stopped investing in technology that

653
00:34:12,560 --> 00:34:15,919
Speaker 16: this has more recently and rightfully so become a governmental

654
00:34:16,040 --> 00:34:19,960
Speaker 16: concern and issue, not just this administration, but administration's previous

655
00:34:19,960 --> 00:34:22,880
Speaker 16: to this as well. Especially over the last five to

656
00:34:22,920 --> 00:34:26,959
Speaker 16: eight to ten years, we realize how drastically far behind

657
00:34:27,080 --> 00:34:30,479
Speaker 16: we are in our manufacturing base, in our industrial base,

658
00:34:30,640 --> 00:34:33,840
Speaker 16: not having the tools and the technology to actually be

659
00:34:34,040 --> 00:34:37,240
Speaker 16: productive at the scale we should be as an American economy.

660
00:34:38,480 --> 00:34:41,200
Speaker 4: Dana Karr mentioned American dynamism, and I think Andrees and

661
00:34:41,239 --> 00:34:44,360
Speaker 4: Horowitz's approach is that they'll say it's about the national interest,

662
00:34:44,880 --> 00:34:48,319
Speaker 4: or Founder's fund will say it's about the military industrial complex.

663
00:34:48,840 --> 00:34:51,719
Speaker 4: But they're at the growth stage mostly right, You're at

664
00:34:51,760 --> 00:34:55,320
Speaker 4: the very early stage in which specific areas of industry

665
00:34:55,360 --> 00:34:58,680
Speaker 4: are you seeing innovations that need to be supported financially

666
00:34:58,760 --> 00:34:59,200
Speaker 4: Right now?

667
00:35:00,400 --> 00:35:04,080
Speaker 16: Absolutely, I think there is an America first need to it,

668
00:35:04,120 --> 00:35:08,080
Speaker 16: but it's more about the technologies. It's about the workers.

669
00:35:08,120 --> 00:35:13,240
Speaker 16: It's about setting up competitive jobs that they can start

670
00:35:13,280 --> 00:35:15,680
Speaker 16: at the brass tack, start at the first principles of

671
00:35:15,719 --> 00:35:17,920
Speaker 16: how they go to work every day, what they do,

672
00:35:18,000 --> 00:35:20,040
Speaker 16: and how that bubbles up in the economy.

673
00:35:20,840 --> 00:35:22,000
Speaker 3: So if you look.

674
00:35:21,800 --> 00:35:23,480
Speaker 16: Back, we look at this as sort of a new

675
00:35:23,560 --> 00:35:27,839
Speaker 16: tech sector, not just an American thing, not just an

676
00:35:27,840 --> 00:35:31,759
Speaker 16: industrial sector. It's how do we turn these industrial industries

677
00:35:31,800 --> 00:35:35,399
Speaker 16: into tech industries like we've done with it jobs since

678
00:35:35,440 --> 00:35:39,160
Speaker 16: the dawning of the Internet. We enjoyed mobile, we enjoyed

679
00:35:39,200 --> 00:35:43,480
Speaker 16: big data, we are now really enjoying the advances of AI.

680
00:35:44,040 --> 00:35:47,399
Speaker 16: And all of these industrial jobs aren't even connected, let

681
00:35:47,440 --> 00:35:50,560
Speaker 16: alone you know, built on top of mobile technology. So

682
00:35:50,640 --> 00:35:54,200
Speaker 16: there is a national interest in competitive, dynamic and comparative

683
00:35:54,239 --> 00:35:57,360
Speaker 16: advantage that comes out of that, but it's been woefully

684
00:35:57,400 --> 00:36:01,000
Speaker 16: neglected for the past twenty five years, and that's a

685
00:36:01,080 --> 00:36:03,480
Speaker 16: lot of technical debt we have to dig ourselves out of.

686
00:36:04,680 --> 00:36:09,279
Speaker 4: When the pitch book hits your desk, how close are

687
00:36:09,320 --> 00:36:12,160
Speaker 4: you looking at that startup's ability to get access to

688
00:36:12,200 --> 00:36:15,759
Speaker 4: public funding or I guess down the road be acquired

689
00:36:15,800 --> 00:36:18,799
Speaker 4: by a bigger company that isn't really innovating right now

690
00:36:18,840 --> 00:36:20,919
Speaker 4: and whatever their manufacturing processes are.

691
00:36:22,200 --> 00:36:24,799
Speaker 16: Yeah, I mean I think first and foremost we look

692
00:36:24,880 --> 00:36:27,480
Speaker 16: for you know, you mentioned early stage. You know, the

693
00:36:27,840 --> 00:36:31,840
Speaker 16: early stage investing sector is really built on incredible founders.

694
00:36:32,200 --> 00:36:35,839
Speaker 16: Incredible founders that can move at a pace that they

695
00:36:35,920 --> 00:36:38,120
Speaker 16: just couldn't do inside a big company or the big

696
00:36:38,160 --> 00:36:42,040
Speaker 16: companies cannot do on their own. We do think about

697
00:36:42,080 --> 00:36:44,560
Speaker 16: companies that should be acquired one day. We think about

698
00:36:44,600 --> 00:36:48,359
Speaker 16: companies that can go public one day. You know, we

699
00:36:48,400 --> 00:36:52,240
Speaker 16: think of ourselves as early stage but full life cycle.

700
00:36:52,120 --> 00:36:53,600
Speaker 2: Investors or boutique.

701
00:36:53,719 --> 00:36:56,319
Speaker 16: We can help entrepreneurs at the beginning, but we can

702
00:36:56,600 --> 00:36:59,520
Speaker 16: also help them with that full commercial scale up to

703
00:36:59,560 --> 00:37:01,959
Speaker 16: help them think about a public market exit one day.

704
00:37:02,320 --> 00:37:04,839
Speaker 16: So we think about true disruption. You know, we look

705
00:37:04,880 --> 00:37:08,720
Speaker 16: at what's missing in the economy. What are the technologies AI,

706
00:37:09,000 --> 00:37:12,160
Speaker 16: physical AI, the things that we're good at here in

707
00:37:12,160 --> 00:37:15,680
Speaker 16: this country, and how do we apply that to these sectors.

708
00:37:16,320 --> 00:37:20,160
Speaker 4: Dana Race and of construct Capital, thank you. A critical

709
00:37:20,160 --> 00:37:23,680
Speaker 4: piece of infrastructure for the growing commercial space industry is

710
00:37:23,760 --> 00:37:24,560
Speaker 4: right here on Earth.

711
00:37:24,719 --> 00:37:25,040
Speaker 2: Ground.

712
00:37:25,080 --> 00:37:28,279
Speaker 4: Antennas send and receive data from satellites in orbit, but

713
00:37:28,320 --> 00:37:32,319
Speaker 4: the infrastructure is aging the tech obsolete and historically it's

714
00:37:32,320 --> 00:37:34,520
Speaker 4: been expensive and time consuming to build the start up.

715
00:37:34,600 --> 00:37:35,799
Speaker 6: Northward just closed the.

716
00:37:35,719 --> 00:37:40,840
Speaker 4: Thirty million dollars Series A to fund address mass produced

717
00:37:41,160 --> 00:37:44,520
Speaker 4: phased array Antenna's Bridget Memla is the co founder and

718
00:37:44,640 --> 00:37:45,960
Speaker 4: CEO and joins us.

719
00:37:46,040 --> 00:37:48,360
Speaker 2: Now in this environment, how.

720
00:37:48,080 --> 00:37:50,200
Speaker 6: Difficult was it to raise that round?

721
00:37:50,280 --> 00:37:52,839
Speaker 17: Good morning, good morning, Thank you for having me. Glad

722
00:37:52,840 --> 00:37:55,040
Speaker 17: to be here. You know, I think we're in a

723
00:37:55,080 --> 00:37:59,360
Speaker 17: really fortunate position where we're building a capability that is

724
00:37:59,640 --> 00:38:04,640
Speaker 17: relevant and so, you know, we had an oversubscribed funding

725
00:38:04,640 --> 00:38:08,400
Speaker 17: ground and we were really emphasizing just getting into the

726
00:38:08,400 --> 00:38:11,560
Speaker 17: field quickly to meet customer demand. There's a lot of

727
00:38:11,560 --> 00:38:14,240
Speaker 17: appetite to serve up increased capacity for grounds.

728
00:38:14,280 --> 00:38:14,759
Speaker 2: That's why we're here.

729
00:38:14,800 --> 00:38:15,759
Speaker 17: That's why we're doing what we're doing.

730
00:38:15,800 --> 00:38:19,319
Speaker 4: Andreas and Horowitz led the round with Ourpine Space founder's fund.

731
00:38:19,360 --> 00:38:21,960
Speaker 4: Is that is a returning investor. I went down a

732
00:38:22,000 --> 00:38:24,759
Speaker 4: deep rabbit hole on phased array antenna.

733
00:38:24,880 --> 00:38:26,359
Speaker 2: Yeah, there are others out there.

734
00:38:26,520 --> 00:38:30,200
Speaker 4: Bel three Harris has done some work Blue Halo. What

735
00:38:30,520 --> 00:38:34,279
Speaker 4: technologically speaking is different about your design and what you

736
00:38:34,320 --> 00:38:34,920
Speaker 4: want to build.

737
00:38:35,520 --> 00:38:41,880
Speaker 17: For us, we're really emphasizing increased manufacturing capacity and lower cost.

738
00:38:42,000 --> 00:38:44,200
Speaker 17: And so that kind of comes in from being a

739
00:38:44,280 --> 00:38:48,239
Speaker 17: vertically integrated company where we're able to not look at

740
00:38:48,280 --> 00:38:52,200
Speaker 17: one silver bullet solution, but our ability to look across

741
00:38:52,239 --> 00:38:56,280
Speaker 17: the technology stack and in diligence every piece of material

742
00:38:56,320 --> 00:38:58,680
Speaker 17: in our system to be able to hit a lower

743
00:38:58,719 --> 00:39:02,800
Speaker 17: price point. And so our systems are intentionally designed for

744
00:39:03,040 --> 00:39:06,040
Speaker 17: deployability and designed to get into the field quickly with

745
00:39:06,080 --> 00:39:09,600
Speaker 17: that capability. And so we were able to with our

746
00:39:09,640 --> 00:39:12,759
Speaker 17: last demonstration with Planet Labs, hit a ten x cost

747
00:39:12,800 --> 00:39:16,520
Speaker 17: reduction relative to existing PHASEORAY technology as well as a

748
00:39:16,520 --> 00:39:20,080
Speaker 17: five x reduction in time to actually field the technology.

749
00:39:20,120 --> 00:39:23,920
Speaker 3: This money, you're going to be increasing production facilities budget,

750
00:39:24,320 --> 00:39:26,279
Speaker 3: Where is it all going to be local, all US

751
00:39:26,400 --> 00:39:27,319
Speaker 3: or all California?

752
00:39:28,160 --> 00:39:31,239
Speaker 17: Oh yeah, yeah, we're operating out of Torrents, California. We

753
00:39:31,320 --> 00:39:34,200
Speaker 17: have a thirty five thousand square foot manufacturing facility that

754
00:39:34,560 --> 00:39:37,880
Speaker 17: we're spinning up so that we can meet the demand

755
00:39:37,960 --> 00:39:40,640
Speaker 17: for the capacity and we're looking to actually begin some

756
00:39:40,719 --> 00:39:42,799
Speaker 17: operational capability later this calendar year.

757
00:39:43,280 --> 00:39:45,920
Speaker 4: How exposed is the supply chain to China when we

758
00:39:45,960 --> 00:39:48,920
Speaker 4: think about integrated circuits and sort of the wire harness

759
00:39:49,040 --> 00:39:53,560
Speaker 4: legacy satellite biz, which is but also you want to

760
00:39:53,600 --> 00:39:56,160
Speaker 4: do business outside of America, this is a global network

761
00:39:56,239 --> 00:39:56,960
Speaker 4: you want to support.

762
00:39:57,280 --> 00:39:59,560
Speaker 17: Yeah, I mean, I think we're benefiting in our supply

763
00:39:59,680 --> 00:40:03,239
Speaker 17: chain from parts where a lot of a lot of

764
00:40:03,239 --> 00:40:05,319
Speaker 17: parts do have optionality to them, and that's something that

765
00:40:05,320 --> 00:40:08,560
Speaker 17: we're intentionally designing for. So we're intentionally designing for systems

766
00:40:08,800 --> 00:40:11,760
Speaker 17: where we can have the benefit of choice.

767
00:40:12,440 --> 00:40:13,319
Speaker 8: And largely we.

768
00:40:13,280 --> 00:40:18,240
Speaker 17: Do choose a lot of domestic companies to support different

769
00:40:18,239 --> 00:40:20,560
Speaker 17: pieces of our supply chain and our components. We do

770
00:40:20,640 --> 00:40:23,520
Speaker 17: have that kind of lean to ourselves. But you know,

771
00:40:23,600 --> 00:40:25,960
Speaker 17: like you mentioned, we're planning to be a company that

772
00:40:26,000 --> 00:40:29,520
Speaker 17: has international deployments. We want to be friendly to other

773
00:40:29,600 --> 00:40:33,240
Speaker 17: nations and so we've been really fortunate to have positive

774
00:40:33,239 --> 00:40:34,560
Speaker 17: collaborations with that so far.

775
00:40:34,680 --> 00:40:38,080
Speaker 4: And recent Horowitz and Founders Fund are both investors in SpaceX,

776
00:40:38,120 --> 00:40:42,120
Speaker 4: actually both investors in Anderil, another Southern California example. Beyond

777
00:40:42,120 --> 00:40:44,000
Speaker 4: the money, how much is it about you know, your

778
00:40:44,000 --> 00:40:47,200
Speaker 4: investors opening the door to those people being your customers.

779
00:40:47,920 --> 00:40:48,120
Speaker 2: Yeah.

780
00:40:48,160 --> 00:40:51,839
Speaker 17: I think they have been tremendously valuable and supportive. That's why,

781
00:40:51,920 --> 00:40:54,000
Speaker 17: you know, we were excited to double down with them

782
00:40:54,160 --> 00:40:58,480
Speaker 17: as well in this latest funding ground, I think, you know,

783
00:40:58,520 --> 00:41:01,440
Speaker 17: for our capabilities there. Uh, you know, we're getting a

784
00:41:01,480 --> 00:41:05,840
Speaker 17: lot of inbound interest from customers directly, but they both

785
00:41:05,880 --> 00:41:09,799
Speaker 17: commercial and government we're having you know, I think for us,

786
00:41:09,800 --> 00:41:12,359
Speaker 17: we're excited to be a dual use company where we

787
00:41:12,600 --> 00:41:16,680
Speaker 17: are building you know, common capabilities, common geographies, being able

788
00:41:16,680 --> 00:41:19,440
Speaker 17: to pass on those economies of scale to our customers.

789
00:41:20,040 --> 00:41:21,920
Speaker 17: So you know, if you look at the government sector,

790
00:41:22,040 --> 00:41:25,600
Speaker 17: those are companies that are you know, dealing with existing

791
00:41:25,640 --> 00:41:28,080
Speaker 17: networks that are more brittle and that are low in capacity.

792
00:41:28,120 --> 00:41:32,399
Speaker 17: And so the opportunity to leverage commercial to get more

793
00:41:32,480 --> 00:41:36,200
Speaker 17: capacity fielded very quickly and to be able to inform

794
00:41:36,280 --> 00:41:38,920
Speaker 17: our capabilities in that way is something that we've actually, like,

795
00:41:38,960 --> 00:41:44,080
Speaker 17: I've even received LinkedIn dms from from different folks that

796
00:41:44,160 --> 00:41:46,640
Speaker 17: are really enthusiastic about the capabilities.

797
00:41:46,640 --> 00:41:49,800
Speaker 8: And so yeah, both both commercial.

798
00:41:49,400 --> 00:41:53,320
Speaker 3: And government has name dropping linked in the capital intensity.

799
00:41:53,680 --> 00:41:55,759
Speaker 3: How long is thaty million gonna last? Your bridget? You've

800
00:41:55,760 --> 00:41:57,279
Speaker 3: just raised it, but I hate to Oscar and you're

801
00:41:57,280 --> 00:41:58,160
Speaker 3: gonna have to do it again.

802
00:41:59,040 --> 00:42:00,160
Speaker 8: Yeah, yeah, we are.

803
00:42:00,719 --> 00:42:02,960
Speaker 17: You know, we're operating in the hard tech sector. It

804
00:42:03,000 --> 00:42:05,680
Speaker 17: is a more capital intensive sector. I think we are

805
00:42:05,719 --> 00:42:09,480
Speaker 17: benefiting from a system that is designed to be efficient

806
00:42:09,480 --> 00:42:12,200
Speaker 17: with capital, and we're also a system that you know,

807
00:42:12,200 --> 00:42:15,360
Speaker 17: we're planning to be operational in the near term horizon.

808
00:42:15,400 --> 00:42:16,719
Speaker 17: You know, it's it's not the kind of thing where

809
00:42:16,719 --> 00:42:18,960
Speaker 17: you have, you know, a ten year timeline before you

810
00:42:18,960 --> 00:42:21,600
Speaker 17: can have an operational capability. For us, it's really important

811
00:42:21,600 --> 00:42:23,879
Speaker 17: to get into the field quickly. I think that's both

812
00:42:23,960 --> 00:42:28,200
Speaker 17: a business incentive for us, but it's also a mission incentive.

813
00:42:28,400 --> 00:42:32,000
Speaker 17: You know, space is now the domain of much of

814
00:42:32,040 --> 00:42:36,600
Speaker 17: our critical infrastructure. It's it's not you know, an experimental territory.

815
00:42:36,680 --> 00:42:40,080
Speaker 17: Space is it's industrialized. That's very core to our mission

816
00:42:40,120 --> 00:42:44,200
Speaker 17: is supporting an industrialized space economy where missions can't go down.

817
00:42:44,719 --> 00:42:48,600
Speaker 17: And so from a mission standpoint, we are very passionate

818
00:42:48,600 --> 00:42:50,160
Speaker 17: about fielding our technology quickly.

819
00:42:50,560 --> 00:42:51,760
Speaker 6: Five seconds valuation.

820
00:42:53,360 --> 00:42:54,920
Speaker 3: I don't know if I can speak to that.

821
00:42:55,480 --> 00:42:56,919
Speaker 6: Yeah, we'll cut it another time.

822
00:42:56,960 --> 00:42:59,080
Speaker 4: Bridget Men, the CEO, northward at the end of a

823
00:42:59,160 --> 00:43:02,560
Speaker 4: packed Bloomberg Technology from San Francisco, New York City. So

824
00:43:02,640 --> 00:43:05,080
Speaker 4: much more to come this week earning starting in earnest.

825
00:43:05,120 --> 00:43:05,880
Speaker 8: This is Bloomberg