1 00:00:02,520 --> 00:00:13,360 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is alive 2 00:00:13,360 --> 00:00:17,200 Speaker 1: from coast to coast with Caroline Hyde in New York 3 00:00:17,480 --> 00:00:19,439 Speaker 1: and Eva Low in San Francisco. 4 00:00:22,800 --> 00:00:25,520 Speaker 2: This is Bloomberg Tech coming up in Video's latest sale 5 00:00:25,600 --> 00:00:29,560 Speaker 2: forecast draws a bearish response from investors, with concerns over 6 00:00:29,560 --> 00:00:32,040 Speaker 2: a potential bubbles still weighing on the company. 7 00:00:32,120 --> 00:00:34,800 Speaker 3: Plus, we break down more tech earnings for the CEOs 8 00:00:34,800 --> 00:00:36,319 Speaker 3: of Snowflake and Chime later this. 9 00:00:36,320 --> 00:00:39,800 Speaker 2: Hour, and Warner Brothers, Discovery and Paramount both out with 10 00:00:39,840 --> 00:00:44,199 Speaker 2: earnings too. As the bidding war drama continues. Let's get 11 00:00:44,240 --> 00:00:46,120 Speaker 2: right to our top story, and Video is now down 12 00:00:46,200 --> 00:00:49,960 Speaker 2: around five percent. Earlier in the session, it had been 13 00:00:49,960 --> 00:00:52,520 Speaker 2: down and on track for its worst day since April 14 00:00:52,880 --> 00:00:56,920 Speaker 2: of last year. It is a change of direction and 15 00:00:57,160 --> 00:01:00,800 Speaker 2: sentiment from where we traded in after our in its 16 00:01:00,800 --> 00:01:03,960 Speaker 2: earning sprint, the forecast for the fiscal first quarter is 17 00:01:04,000 --> 00:01:07,000 Speaker 2: sales of seventy eight billion dollars plus or minus two percent. 18 00:01:07,680 --> 00:01:11,800 Speaker 2: Interesting margin guidance that sales forecast does not include any 19 00:01:11,800 --> 00:01:15,200 Speaker 2: contribution from data center revenues from China. Let's get to 20 00:01:15,200 --> 00:01:18,840 Speaker 2: Bloombsie inking who leads our coverage of this name. It 21 00:01:18,920 --> 00:01:21,280 Speaker 2: was all about the outlook. So that's the data points 22 00:01:21,319 --> 00:01:24,480 Speaker 2: seventy eight billion dollars of sales there or thereabouts. Actually, 23 00:01:25,600 --> 00:01:28,399 Speaker 2: Jensenwong and collect Crest. The CFO went beyond that to 24 00:01:28,440 --> 00:01:31,039 Speaker 2: say that five hundred billion dollar guide, which is just 25 00:01:31,080 --> 00:01:34,120 Speaker 2: Blackwel and Rubin. Actually they're probably tracking ahead of that now. 26 00:01:34,120 --> 00:01:35,360 Speaker 2: The SOCK is down five percent. 27 00:01:35,720 --> 00:01:38,480 Speaker 4: Yeah, you're breaking down the numbers. And we tried to 28 00:01:38,520 --> 00:01:41,120 Speaker 4: do the same. I spoke to numerous people after the 29 00:01:41,200 --> 00:01:44,600 Speaker 4: report yesterday, and nobody is pointing to any number and 30 00:01:44,640 --> 00:01:47,680 Speaker 4: saying that's a problem. That's worse than what we're expecting. 31 00:01:48,240 --> 00:01:51,200 Speaker 4: Across the board, they were saying other numbers were better 32 00:01:51,280 --> 00:01:55,080 Speaker 4: than we expected if there is an identifiable problem. It 33 00:01:55,200 --> 00:01:58,400 Speaker 4: was this amorphous idea that well, where's the news story, 34 00:01:58,480 --> 00:01:59,520 Speaker 4: what's going to take. 35 00:01:59,360 --> 00:02:02,559 Speaker 3: This to the next and is that GtC ian. 36 00:02:04,240 --> 00:02:07,320 Speaker 4: That was the conclusion that people have come up with that. 37 00:02:07,600 --> 00:02:09,720 Speaker 4: You know, they want Jensen to walk out on stage 38 00:02:09,760 --> 00:02:12,400 Speaker 4: and santase like he does and tell them something new 39 00:02:12,440 --> 00:02:17,840 Speaker 4: and exciting, show them a new path forward, and that 40 00:02:18,000 --> 00:02:18,640 Speaker 4: was the end of it. 41 00:02:18,680 --> 00:02:19,000 Speaker 5: Really. 42 00:02:19,160 --> 00:02:21,880 Speaker 2: GtC is in Nvidia's big showcase for the audience and 43 00:02:21,919 --> 00:02:24,079 Speaker 2: those aren't familiar with it, and often they do come 44 00:02:24,080 --> 00:02:25,919 Speaker 2: out and say something quite big. 45 00:02:26,280 --> 00:02:27,720 Speaker 6: There were other bits in there. 46 00:02:27,560 --> 00:02:30,359 Speaker 2: For example, if we continue to talk about how this 47 00:02:30,440 --> 00:02:34,480 Speaker 2: is a supply constrained industry, right detail about how they 48 00:02:34,480 --> 00:02:37,680 Speaker 2: have inventory and capacity for several quarters, but are warning 49 00:02:37,720 --> 00:02:41,600 Speaker 2: at the same time from collect press that actually supplies 50 00:02:41,680 --> 00:02:45,000 Speaker 2: still something to think about, how are they managing the 51 00:02:45,040 --> 00:02:47,960 Speaker 2: world of intense AI compute demand. 52 00:02:48,120 --> 00:02:50,120 Speaker 4: Yeah, I mean, that's just one of the questions that 53 00:02:50,240 --> 00:02:53,639 Speaker 4: they had to answer and did. And the answer was, look, 54 00:02:53,680 --> 00:02:55,520 Speaker 4: we've spent a lot of money, We've got a lot 55 00:02:55,680 --> 00:02:59,520 Speaker 4: of inventory ready. We can support growth into twenty twenty seven, right, 56 00:03:00,000 --> 00:03:02,880 Speaker 4: as an answered. At the same time, people were like, 57 00:03:03,080 --> 00:03:06,160 Speaker 4: what about memory chips, what about you know, high end capacity, 58 00:03:06,200 --> 00:03:08,080 Speaker 4: and she did said, look, it is tight, but we 59 00:03:08,240 --> 00:03:09,799 Speaker 4: have what we need for now. 60 00:03:10,560 --> 00:03:13,560 Speaker 3: Glimpergsy and King with the breakdown. We thank you, let's 61 00:03:13,560 --> 00:03:16,359 Speaker 3: get more in the video. Sereney Pajuria is with us 62 00:03:16,480 --> 00:03:19,280 Speaker 3: OBBC Capital Markets research analyst. He has an outperform rating 63 00:03:19,320 --> 00:03:21,640 Speaker 3: on the stock, has raised his price target from two 64 00:03:21,680 --> 00:03:25,080 Speaker 3: hundred fourteen to two hundred and fifty. And You're not alone, shoney, 65 00:03:25,160 --> 00:03:27,919 Speaker 3: because I'm looking at True Securities raising their price target, 66 00:03:27,960 --> 00:03:30,800 Speaker 3: City did JP Morgan did Morgan Stanley raise their price target, 67 00:03:30,919 --> 00:03:33,560 Speaker 3: called it the largest cleanest beat and raised in the 68 00:03:33,720 --> 00:03:36,000 Speaker 3: history of semis industry. 69 00:03:36,680 --> 00:03:37,520 Speaker 6: What was missing? 70 00:03:39,120 --> 00:03:42,560 Speaker 7: Right? I mean, they delivered on everything. You know, they 71 00:03:42,800 --> 00:03:45,840 Speaker 7: checked all the boxes. You know, for Nvidia, given their 72 00:03:45,840 --> 00:03:49,640 Speaker 7: track record, the expectations are always high, and they were 73 00:03:49,720 --> 00:03:52,120 Speaker 7: high this quarter. And you know, they came in well 74 00:03:52,360 --> 00:03:55,240 Speaker 7: well even the high end of the so called whisper numbers. 75 00:03:55,600 --> 00:03:59,880 Speaker 7: And also they talked about visibility extending well into you know, 76 00:04:00,400 --> 00:04:03,760 Speaker 7: twenty twenty seven. And if you look at the breakdown 77 00:04:03,800 --> 00:04:07,240 Speaker 7: of the quarter, you know what drew actually what led 78 00:04:07,280 --> 00:04:12,760 Speaker 7: the growth was interestingly the non hyperscaler business, which is 79 00:04:12,840 --> 00:04:15,480 Speaker 7: kind of you know, suggests that you know, the AI 80 00:04:15,720 --> 00:04:19,279 Speaker 7: momentum is spreading into you know, the broader markets like 81 00:04:19,440 --> 00:04:22,640 Speaker 7: enterprise and in a smaller cloud customers, et cetera. And 82 00:04:22,720 --> 00:04:27,479 Speaker 7: then in addition to that, networking was particularly strong. That's 83 00:04:27,520 --> 00:04:31,040 Speaker 7: also a positive sign in our view because networking is 84 00:04:31,080 --> 00:04:34,240 Speaker 7: a market where and video is actually gaining share. You know, 85 00:04:34,279 --> 00:04:36,680 Speaker 7: they don't have as dominant as a position as they 86 00:04:36,760 --> 00:04:39,360 Speaker 7: as they do in compute, So you know, I would 87 00:04:39,400 --> 00:04:42,800 Speaker 7: say those are actually, you know, definite incremental positives in 88 00:04:42,839 --> 00:04:46,160 Speaker 7: the quarter, and then there were some concerns about gross 89 00:04:46,200 --> 00:04:49,719 Speaker 7: margins heading into the print, and you know, they guide 90 00:04:49,720 --> 00:04:52,240 Speaker 7: it to mid seventy percent despite the fact that memory 91 00:04:52,279 --> 00:04:54,279 Speaker 7: pricing is up, you know, more than one hundred percent 92 00:04:54,320 --> 00:04:56,880 Speaker 7: this year. So you know, as I said, you know, 93 00:04:56,880 --> 00:04:59,039 Speaker 7: they checked every every box. I think I think the 94 00:04:59,080 --> 00:05:01,479 Speaker 7: reason for the stock action, if I have to guess, is, 95 00:05:01,520 --> 00:05:05,880 Speaker 7: you know, the concerns about the broader AI spending sustainability. 96 00:05:06,720 --> 00:05:08,800 Speaker 7: So you know, that's more of a market concern as 97 00:05:08,800 --> 00:05:10,240 Speaker 7: a post a thing that this said. 98 00:05:10,880 --> 00:05:14,400 Speaker 3: Call about that sustainability, because you've just outlined how they 99 00:05:14,480 --> 00:05:18,039 Speaker 3: managed to diversify their end customer. About fifty percent of 100 00:05:18,120 --> 00:05:20,520 Speaker 3: data center demand was from hyperscalers, but they are looking 101 00:05:20,560 --> 00:05:23,200 Speaker 3: for sovereign AI and the like. Are we needing to 102 00:05:23,200 --> 00:05:25,680 Speaker 3: hear more about growth in China for example, which again 103 00:05:25,800 --> 00:05:28,400 Speaker 3: isn't being factored into the forecast. How much can we 104 00:05:28,440 --> 00:05:30,800 Speaker 3: support that the capital expenditure is going to last through 105 00:05:30,839 --> 00:05:32,000 Speaker 3: twenty twenty seven. 106 00:05:31,800 --> 00:05:36,279 Speaker 7: Fiscal Yeah, so look, you know it's it's the adaptation 107 00:05:36,480 --> 00:05:38,600 Speaker 7: is broadening that there's no question about it. We are 108 00:05:38,640 --> 00:05:41,159 Speaker 7: seeing that, you know, on the enterprise side. On this 109 00:05:41,240 --> 00:05:44,560 Speaker 7: sovereign side, you know, China is going a little tricky 110 00:05:44,640 --> 00:05:47,359 Speaker 7: because you know, there's a lot of geopolitical issues here. 111 00:05:47,760 --> 00:05:50,159 Speaker 7: The good thing is that the management did not include 112 00:05:50,160 --> 00:05:53,440 Speaker 7: any China revenue in the guidance. So if it comes through, 113 00:05:53,480 --> 00:05:54,880 Speaker 7: it's it's upside to the model. 114 00:05:55,800 --> 00:05:56,040 Speaker 5: I think. 115 00:05:56,160 --> 00:05:58,200 Speaker 7: I think it's going to be incremental longer term. We're 116 00:05:58,240 --> 00:06:00,880 Speaker 7: not counting on China. You know, look at the valuation. 117 00:06:01,800 --> 00:06:03,359 Speaker 7: You know it's in the you know, a load of 118 00:06:03,360 --> 00:06:06,760 Speaker 7: mid twenties today on forward numbers. You know, that's pretty 119 00:06:06,800 --> 00:06:10,560 Speaker 7: attractive for a stock or a company that's growing. You know, 120 00:06:10,600 --> 00:06:13,960 Speaker 7: it grew a seventy percent plus. Obviously that's not sustainable, 121 00:06:14,279 --> 00:06:17,159 Speaker 7: but our expectation is that even in twenty seven this 122 00:06:17,279 --> 00:06:21,120 Speaker 7: company can grow at least thirty percent, and at this 123 00:06:21,240 --> 00:06:23,760 Speaker 7: level of gross margins and profitability, I think that's a 124 00:06:23,760 --> 00:06:25,159 Speaker 7: particularly attractive valuation. 125 00:06:26,000 --> 00:06:29,960 Speaker 2: In your risks rating column, in your research, not very clearly, 126 00:06:30,080 --> 00:06:34,440 Speaker 2: hyper scale spending is a leading indicator for AI demand. 127 00:06:34,800 --> 00:06:37,040 Speaker 2: Gensmung was asked that on the call. This is what 128 00:06:37,080 --> 00:06:37,479 Speaker 2: he said. 129 00:06:38,760 --> 00:06:42,760 Speaker 8: I am confident in their cash flow growing. You need 130 00:06:42,839 --> 00:06:46,680 Speaker 8: compute capacity, and that translates directly to growth, and that 131 00:06:46,720 --> 00:06:48,320 Speaker 8: translates directly to revenues. 132 00:06:50,680 --> 00:06:55,080 Speaker 2: He was asked about capital expenditures growth going forward. His 133 00:06:55,279 --> 00:06:58,720 Speaker 2: answer was confidence in cash flows because of course cash 134 00:06:58,720 --> 00:07:01,920 Speaker 2: flows have been impacted by the capets commitment. He didn't 135 00:07:02,000 --> 00:07:04,960 Speaker 2: really answer the question, but what did you interpret from 136 00:07:05,000 --> 00:07:05,720 Speaker 2: what he did say. 137 00:07:07,160 --> 00:07:09,359 Speaker 7: Look, at the end of the day, you know, the 138 00:07:09,400 --> 00:07:11,880 Speaker 7: spending has to have a return, right The ROI is 139 00:07:12,000 --> 00:07:15,280 Speaker 7: very important, But we're still very early in terms of 140 00:07:15,320 --> 00:07:18,480 Speaker 7: the AI cycle. And part of the reason we are 141 00:07:18,560 --> 00:07:22,040 Speaker 7: speeing we're seeing this, you know, elevated spending, is that 142 00:07:22,120 --> 00:07:25,320 Speaker 7: the competition among these big four or five hyperscalers is 143 00:07:25,320 --> 00:07:29,680 Speaker 7: pretty intense. You know, it's still the battle for leadership 144 00:07:29,760 --> 00:07:32,440 Speaker 7: is still not settled. I mean, just recently, you know, 145 00:07:32,560 --> 00:07:35,640 Speaker 7: Google took the lead in terms of the large language 146 00:07:35,640 --> 00:07:39,200 Speaker 7: model performance, and you know you have open Ai Anthropic 147 00:07:39,280 --> 00:07:43,040 Speaker 7: right behind them and x Ai. So there's the competition 148 00:07:43,120 --> 00:07:45,440 Speaker 7: is quite intense and we don't expect that battle to 149 00:07:45,440 --> 00:07:48,160 Speaker 7: settle anytime soon. So it's not so much about ROI 150 00:07:48,320 --> 00:07:51,160 Speaker 7: right now. Longer term, it does matter, of course, you know, 151 00:07:51,200 --> 00:07:54,360 Speaker 7: we need we need to generate free cashlows for the 152 00:07:54,360 --> 00:07:57,760 Speaker 7: investments that these companies are making but at the same time, 153 00:07:58,120 --> 00:08:00,840 Speaker 7: right now, it's more about the competition and the battle 154 00:08:00,840 --> 00:08:02,520 Speaker 7: for leadership in AI in my view. 155 00:08:04,240 --> 00:08:06,880 Speaker 2: Very quickly, Jensen Wong sprung to the defense of the 156 00:08:06,880 --> 00:08:12,640 Speaker 2: software industry. Is the ecosystem of his other customers healthy. 157 00:08:14,320 --> 00:08:16,440 Speaker 7: Yeah, I mean, look, I'm not an expert in software, 158 00:08:16,480 --> 00:08:19,360 Speaker 7: but at the same time, we are seeing broadening adaptation 159 00:08:19,480 --> 00:08:23,680 Speaker 7: of AI in the enterprise. His views, as he stated yesterday, 160 00:08:24,160 --> 00:08:26,840 Speaker 7: is that you know, AI is you know, it is 161 00:08:26,960 --> 00:08:30,640 Speaker 7: more of an agentic in nature. You know, the software 162 00:08:30,760 --> 00:08:34,760 Speaker 7: essentially the tools. Our software team agrees with that. You know, 163 00:08:34,880 --> 00:08:39,080 Speaker 7: our software has been you know, positive on the sector. 164 00:08:39,600 --> 00:08:41,800 Speaker 7: But at the same time, I'm not an expert in 165 00:08:41,840 --> 00:08:44,920 Speaker 7: that sector. So all right, I'll probably refrain from commenting 166 00:08:44,920 --> 00:08:45,120 Speaker 7: on that. 167 00:08:45,800 --> 00:08:48,679 Speaker 2: Shinny Bajeria Barbously Capital Markets, thank you very much for 168 00:08:48,760 --> 00:08:51,800 Speaker 2: coming up. Snowflake CEO joins us to talk about his 169 00:08:51,840 --> 00:08:55,120 Speaker 2: company's earnings and the fears of AI driven disruption. That's 170 00:08:55,120 --> 00:08:57,840 Speaker 2: one move is to the upside. This is Bloomberg Tech. 171 00:09:02,200 --> 00:09:05,199 Speaker 3: Snowflake another of the tech names that released earnings yesterday 172 00:09:05,240 --> 00:09:07,520 Speaker 3: after the bell and as investors look for signs of 173 00:09:07,559 --> 00:09:11,360 Speaker 3: AI adoption or disruption, it's forecast product revenue for the 174 00:09:11,440 --> 00:09:13,880 Speaker 3: current quarter will be about one point two six billion dollars. 175 00:09:13,920 --> 00:09:16,160 Speaker 3: That's up twenty seven percent. They reported more than nine 176 00:09:16,160 --> 00:09:19,079 Speaker 3: thousand accounts using Snowflake AI features shares. 177 00:09:19,160 --> 00:09:20,400 Speaker 6: You can see three. 178 00:09:20,280 --> 00:09:24,400 Speaker 3: Point seven percent. Let's bringing the Snowflake CEO Shida Ramaswami Shida, 179 00:09:24,520 --> 00:09:27,480 Speaker 3: I'm reading notes f mazoo Ho saying bookings were a standout. 180 00:09:27,480 --> 00:09:30,040 Speaker 3: They're talking about the seven nine figure deals that have come. 181 00:09:30,600 --> 00:09:33,240 Speaker 3: Where are those deals coming from? What are those customers 182 00:09:33,240 --> 00:09:33,920 Speaker 3: demanding of you? 183 00:09:35,880 --> 00:09:38,640 Speaker 9: Great to see you, Caroline. Yes, we had seven nine 184 00:09:38,640 --> 00:09:42,040 Speaker 9: figure deals, including a man of four hundred million dollar deal. 185 00:09:42,760 --> 00:09:47,320 Speaker 9: It reflects the confidence that our customers have, both in 186 00:09:47,800 --> 00:09:51,640 Speaker 9: where Snowflake is right now, but importantly where we are going. 187 00:09:52,040 --> 00:09:55,440 Speaker 9: We all understand that software is being disrupted by AI 188 00:09:55,760 --> 00:09:59,000 Speaker 9: in a very very big way. But what our customers 189 00:09:59,040 --> 00:10:02,839 Speaker 9: understand is that what enterprise AI to truly succeed, they 190 00:10:02,880 --> 00:10:05,520 Speaker 9: need a single source of enterprise true. They need built 191 00:10:05,520 --> 00:10:09,440 Speaker 9: in security, auditibility, trust and access. Of course, you also 192 00:10:09,480 --> 00:10:12,800 Speaker 9: need the best models. That's what Snowflakes provides for them. 193 00:10:13,040 --> 00:10:15,800 Speaker 9: And we're creating great products, products like Snowflake Intelligence that 194 00:10:15,960 --> 00:10:18,720 Speaker 9: put the power of data into the hands of every 195 00:10:18,840 --> 00:10:24,120 Speaker 9: business user. The healthcare company, I mean the health company 196 00:10:24,440 --> 00:10:28,680 Speaker 9: loves using us, and there are lots of partners that 197 00:10:29,000 --> 00:10:31,800 Speaker 9: are using products like Cortex Code to speed up what 198 00:10:31,920 --> 00:10:34,880 Speaker 9: can be done with Snowflake. They're really looking to the 199 00:10:34,960 --> 00:10:38,679 Speaker 9: future and making sure that we can deliver value with Snowflake, 200 00:10:38,840 --> 00:10:41,400 Speaker 9: and we are creating the products that help them deliver 201 00:10:41,480 --> 00:10:43,600 Speaker 9: that kind of value, Dane, and they are. That's why 202 00:10:43,640 --> 00:10:46,080 Speaker 9: you are seeing companies, as you said, make commitments of 203 00:10:46,120 --> 00:10:49,040 Speaker 9: four hundred plus million dollars with Snowflick. 204 00:10:49,360 --> 00:10:51,719 Speaker 3: I'm really interested in codex code with something that was 205 00:10:51,720 --> 00:10:54,760 Speaker 3: talked a lot about recall and people are adopting swiftly. 206 00:10:55,000 --> 00:10:56,959 Speaker 3: But that partnership model that you have, the fact that 207 00:10:57,000 --> 00:11:00,000 Speaker 3: you have integrations with Anthropic, Open ai Cloud, also Google 208 00:11:00,200 --> 00:11:02,920 Speaker 3: how but some of these have very good coding tools 209 00:11:02,920 --> 00:11:05,640 Speaker 3: of their own. How do you see this ecosystem evolving 210 00:11:05,679 --> 00:11:08,400 Speaker 3: because customers get it, but the investments have been questioning 211 00:11:08,440 --> 00:11:10,600 Speaker 3: whether they'll take away your market share. 212 00:11:12,440 --> 00:11:14,559 Speaker 9: Well, so there are a lot of things that are 213 00:11:14,600 --> 00:11:19,680 Speaker 9: specific to Snowflake and to data. Absolutely, there are coding 214 00:11:19,720 --> 00:11:22,880 Speaker 9: agents that are often provided by the model companies themselves. 215 00:11:23,040 --> 00:11:25,320 Speaker 9: But we know a lot about how data systems are 216 00:11:25,320 --> 00:11:27,960 Speaker 9: supposed to work, about how Snowflake is supposed to work, 217 00:11:28,120 --> 00:11:32,319 Speaker 9: and Cortex Code is super tightly integrated with the customer's 218 00:11:32,320 --> 00:11:35,480 Speaker 9: Snowflake account. Data does not go anywhere. And remember we 219 00:11:35,559 --> 00:11:38,720 Speaker 9: have earned the trust of all of these customers with certifications, 220 00:11:38,760 --> 00:11:42,760 Speaker 9: with the guarantee around things like AIUS. We never use 221 00:11:42,800 --> 00:11:46,560 Speaker 9: customer data for things like training models. They get the 222 00:11:47,080 --> 00:11:50,120 Speaker 9: superior models that we get through partnerships with these folks, 223 00:11:50,320 --> 00:11:53,520 Speaker 9: but we also add the secret sauce of data of 224 00:11:53,559 --> 00:11:57,400 Speaker 9: how Snowflake works into products like Cortex Code, and we 225 00:11:57,440 --> 00:12:01,400 Speaker 9: are seeing amazing wins both internally and also externally. One 226 00:12:01,440 --> 00:12:04,400 Speaker 9: of our partners told us that having Cortex Code was 227 00:12:04,559 --> 00:12:08,040 Speaker 9: like Snowflake supplying them with bulldozers were previously they had shovels. 228 00:12:09,240 --> 00:12:09,560 Speaker 6: Shauda. 229 00:12:09,640 --> 00:12:11,840 Speaker 2: One of the core pillars for you to grow is 230 00:12:11,880 --> 00:12:14,480 Speaker 2: to go out and find new customers. And I wondered, 231 00:12:14,520 --> 00:12:16,920 Speaker 2: if you just give some detail on what's happening in 232 00:12:16,920 --> 00:12:20,720 Speaker 2: the world of technology in ai that would bring a 233 00:12:20,760 --> 00:12:23,280 Speaker 2: customer to Snowflake for the first time. What is it 234 00:12:23,320 --> 00:12:24,920 Speaker 2: that they need that they didn't before. 235 00:12:28,080 --> 00:12:30,920 Speaker 9: Typically they come to us because they need better insight 236 00:12:31,160 --> 00:12:34,240 Speaker 9: into data it is sitting somewhere. It's hard for them 237 00:12:34,280 --> 00:12:37,600 Speaker 9: to get these insights. But increasingly what we're able to 238 00:12:37,600 --> 00:12:41,800 Speaker 9: do is have our sales team build an honest to 239 00:12:41,840 --> 00:12:45,959 Speaker 9: goodness customize demo of something like a Snowflake intelligence on 240 00:12:46,360 --> 00:12:48,640 Speaker 9: data that on the kind of data that a customer 241 00:12:48,679 --> 00:12:52,240 Speaker 9: is going to have. It is that easy access that really, 242 00:12:52,640 --> 00:12:55,839 Speaker 9: you know, is the big winner for our customers. And 243 00:12:56,080 --> 00:12:59,679 Speaker 9: smart customers are also quickly realizing that having data in 244 00:12:59,760 --> 00:13:03,520 Speaker 9: snow means that they can think about how this data 245 00:13:03,600 --> 00:13:05,240 Speaker 9: is going to be used in ways that they had 246 00:13:05,280 --> 00:13:08,240 Speaker 9: not done before. Santa Fe, which is an existing customer, 247 00:13:08,520 --> 00:13:12,040 Speaker 9: is now is now using Snowflake intelligence our AI products 248 00:13:12,120 --> 00:13:15,200 Speaker 9: to redefine a lot of workflows, replacing a lot of 249 00:13:15,240 --> 00:13:19,000 Speaker 9: existing software. These are the use cases that drive these 250 00:13:19,040 --> 00:13:21,199 Speaker 9: customers to come to Snowflake and adopt it. 251 00:13:22,080 --> 00:13:22,440 Speaker 6: Shrida. 252 00:13:22,559 --> 00:13:25,600 Speaker 2: Last night, Jensen Wang, who you know very well, talked 253 00:13:25,640 --> 00:13:29,480 Speaker 2: about profitable tokens, the idea that the output of an 254 00:13:29,480 --> 00:13:33,160 Speaker 2: AI model is worth paying for. Customers do pay, and 255 00:13:33,200 --> 00:13:35,920 Speaker 2: they pay it a price that is greater than the 256 00:13:35,960 --> 00:13:37,480 Speaker 2: compute used to generate it. 257 00:13:38,080 --> 00:13:39,400 Speaker 6: Are you able to give me any. 258 00:13:39,200 --> 00:13:42,160 Speaker 2: Evidence through snowflakes lens that you actually see that in 259 00:13:42,200 --> 00:13:42,840 Speaker 2: the real world. 260 00:13:44,320 --> 00:13:49,480 Speaker 9: Well, what I can assure you is getting projects done 261 00:13:49,880 --> 00:13:54,120 Speaker 9: as being changed dramatically. Something like setting up a pipeline 262 00:13:54,559 --> 00:13:56,680 Speaker 9: used to be a multi week task, We can get 263 00:13:56,679 --> 00:13:59,600 Speaker 9: that done in a small number of hours. My team's 264 00:13:59,600 --> 00:14:04,480 Speaker 9: come to me just last weekend with speed ucks going 265 00:14:04,559 --> 00:14:07,880 Speaker 9: from four weeks for a software engineering project that they 266 00:14:07,920 --> 00:14:11,360 Speaker 9: did down to forty minutes. That is one hundred x 267 00:14:11,480 --> 00:14:13,839 Speaker 9: speed up. And we are happy to spend any number 268 00:14:13,840 --> 00:14:16,560 Speaker 9: of tokens in those forty minutes to save that kind 269 00:14:16,600 --> 00:14:19,560 Speaker 9: of time. I think coding agents are really quite magical 270 00:14:19,600 --> 00:14:22,960 Speaker 9: in the value that they deliver, and I think it's 271 00:14:23,000 --> 00:14:26,400 Speaker 9: only going to accelerate from here, and so these investments 272 00:14:26,480 --> 00:14:29,840 Speaker 9: are going to be pretty foundational in every company you 273 00:14:29,840 --> 00:14:33,160 Speaker 9: know succeeding and thriving. And that's why we're so bullish 274 00:14:33,160 --> 00:14:34,160 Speaker 9: about codex. 275 00:14:33,840 --> 00:14:35,920 Speaker 3: Code and how much you have to invest in your 276 00:14:35,920 --> 00:14:38,360 Speaker 3: own business. I mean, the bullet case for many is 277 00:14:38,560 --> 00:14:40,880 Speaker 3: you need to keep up with a furious pace of innovation. 278 00:14:41,080 --> 00:14:42,560 Speaker 3: Can you at this moment? 279 00:14:42,600 --> 00:14:48,400 Speaker 9: Briefly, we can because we are organized to drive rapid innovation. 280 00:14:48,880 --> 00:14:51,720 Speaker 9: The team that is driving a product like Snowflake Intelligence 281 00:14:51,840 --> 00:14:53,960 Speaker 9: is not that large, but we have structured it in 282 00:14:54,000 --> 00:14:57,240 Speaker 9: such a way that they can make rapid progress. And 283 00:14:57,840 --> 00:15:00,480 Speaker 9: it is more the meta structure of how you set 284 00:15:00,520 --> 00:15:04,120 Speaker 9: up environments where people can get work done quickly and effectively. 285 00:15:04,200 --> 00:15:06,600 Speaker 9: That matters a lot more than things like how much 286 00:15:06,600 --> 00:15:10,240 Speaker 9: hardware you are investing in and things like that. The 287 00:15:10,280 --> 00:15:12,800 Speaker 9: current moment is magical because all of us have access 288 00:15:12,840 --> 00:15:16,400 Speaker 9: to great tools. It really comes down to how effectively 289 00:15:16,480 --> 00:15:19,080 Speaker 9: we set up teams on projects to get things done. 290 00:15:19,200 --> 00:15:21,640 Speaker 9: And that's why we are very bullish on how we 291 00:15:21,680 --> 00:15:24,200 Speaker 9: have set things up at Snowflake because we now have 292 00:15:24,320 --> 00:15:28,240 Speaker 9: a demonstrated capability to be right at the cutting edge 293 00:15:28,360 --> 00:15:30,640 Speaker 9: of where AI is having impact. 294 00:15:31,360 --> 00:15:33,920 Speaker 2: Snowflake SEO shreet A Ramaswami. Great to have you back 295 00:15:33,960 --> 00:15:36,320 Speaker 2: on Bloomberg Tech. Thank you very much. Now coming up 296 00:15:37,640 --> 00:15:40,560 Speaker 2: continues and this time it's with Hollywood. We'll discuss results 297 00:15:40,560 --> 00:15:44,440 Speaker 2: from Warner Brothers and Paramount. That's next. This is Bloomberg Tech. 298 00:15:49,480 --> 00:15:53,920 Speaker 10: Ward continues to lead a rigorous, highly competitive and thorough 299 00:15:54,000 --> 00:15:58,880 Speaker 10: sales process. We engage with four bidders which lent to 300 00:15:58,960 --> 00:16:03,360 Speaker 10: eight pricing and have thus far achieved the sixty three 301 00:16:03,400 --> 00:16:06,480 Speaker 10: percent increase in value for it's the first offer the 302 00:16:06,560 --> 00:16:12,200 Speaker 10: seed in September, delivering significant value for WBD shareholders. 303 00:16:12,240 --> 00:16:16,280 Speaker 3: Throughout the process, Warner Brothers Discovery CEO Davids Aslav, they're 304 00:16:16,280 --> 00:16:19,960 Speaker 3: discussing the progress of deal talks. An increased offer from 305 00:16:20,000 --> 00:16:22,280 Speaker 3: Paramount has renewed the take of attention, and it comes 306 00:16:22,360 --> 00:16:25,160 Speaker 3: as Warner Brothers posted a six percent decline in revenue 307 00:16:25,240 --> 00:16:27,400 Speaker 3: during the fourth quarter of Paramounts Guidance also came out 308 00:16:27,440 --> 00:16:30,400 Speaker 3: with this numbers as bringing bring by media reporter Hannah Miller, 309 00:16:30,760 --> 00:16:35,920 Speaker 3: and all of this speaks to still profitable cable companies 310 00:16:36,400 --> 00:16:40,240 Speaker 3: where they're trying to subsidize basically revenue, well profits not 311 00:16:40,280 --> 00:16:43,160 Speaker 3: showing up and streaming thus far. But subscriber growth is there. 312 00:16:43,320 --> 00:16:46,520 Speaker 11: Yeah, this is subscriber growth is there, and you know, 313 00:16:46,560 --> 00:16:48,800 Speaker 11: Warner Brothers has made a point that they want to 314 00:16:48,840 --> 00:16:51,320 Speaker 11: build up that subscriber account. They're shooting for one hundred 315 00:16:51,400 --> 00:16:55,000 Speaker 11: and fifty million people for their streaming services by the 316 00:16:55,040 --> 00:16:57,480 Speaker 11: end of this year. And you know, we have seen 317 00:16:57,520 --> 00:17:00,760 Speaker 11: these gains, but again they're overshadowed by the fact that 318 00:17:00,960 --> 00:17:03,880 Speaker 11: revenue earnings have declined compared. 319 00:17:03,560 --> 00:17:04,160 Speaker 8: To last year. 320 00:17:05,840 --> 00:17:08,040 Speaker 2: There's also this idea of like what's happening with the 321 00:17:08,240 --> 00:17:10,679 Speaker 2: bottom line, and we can't get away from what's happening 322 00:17:10,680 --> 00:17:11,280 Speaker 2: in the background. 323 00:17:11,320 --> 00:17:12,640 Speaker 6: You know, it's awkward when you have. 324 00:17:12,720 --> 00:17:15,520 Speaker 2: Company earnings and all the players involved are in a 325 00:17:15,600 --> 00:17:16,400 Speaker 2: kind of bidding war. 326 00:17:16,520 --> 00:17:19,360 Speaker 6: Did they explain any of that, Hannah. 327 00:17:18,840 --> 00:17:21,960 Speaker 11: Yeah, so, you know, all these earnings results, they've been 328 00:17:22,000 --> 00:17:24,680 Speaker 11: overshadowed by this bidding war. And we saw on birth 329 00:17:24,760 --> 00:17:27,439 Speaker 11: both earnings calls that you know, the CEOs were like, 330 00:17:27,440 --> 00:17:29,239 Speaker 11: we don't really want to comment on this. Things are 331 00:17:29,320 --> 00:17:33,240 Speaker 11: still underway. What's happening right now is the Warner Brothers 332 00:17:33,240 --> 00:17:37,400 Speaker 11: board has to determine whether or not the most paramounts 333 00:17:37,400 --> 00:17:40,720 Speaker 11: most recent offer could be considered superior to their current 334 00:17:40,720 --> 00:17:44,760 Speaker 11: agreement with Netflix. If they do make that declaration, Netflix 335 00:17:44,800 --> 00:17:47,760 Speaker 11: has four days to respond with either sweetened offer or 336 00:17:47,840 --> 00:17:48,639 Speaker 11: just bowing out. 337 00:17:50,160 --> 00:17:50,560 Speaker 6: Playbox. 338 00:17:50,600 --> 00:17:52,840 Speaker 2: Hannah Miller, who's been across all of this in real time, 339 00:17:52,880 --> 00:17:54,720 Speaker 2: Thank you very much. Let's move on to another big 340 00:17:54,720 --> 00:17:57,960 Speaker 2: media named Paramount. It posted eight point one five billion 341 00:17:58,000 --> 00:18:00,440 Speaker 2: dollars in revenue in the shares again, and it's kind 342 00:18:00,440 --> 00:18:04,280 Speaker 2: of interesting they're reacting significantly. We're up eleven percent? Are 343 00:18:04,280 --> 00:18:06,679 Speaker 2: we up eleven percent? Because of the health of the 344 00:18:06,720 --> 00:18:08,879 Speaker 2: business and the content of earnings, or are we up 345 00:18:08,920 --> 00:18:11,560 Speaker 2: for another reason. Let's discuss with Laura Martin, senior Entertainment 346 00:18:11,600 --> 00:18:14,879 Speaker 2: and Internet analysts and Needham and Company. Laura, you're recommending 347 00:18:14,960 --> 00:18:19,320 Speaker 2: fundamental investors. Hello, remain on the sidelines. I just showed 348 00:18:19,359 --> 00:18:22,160 Speaker 2: the chart. Maybe they'll bring it back up sup eleven percent. 349 00:18:23,000 --> 00:18:24,159 Speaker 2: Reconcile that please? 350 00:18:25,320 --> 00:18:25,520 Speaker 5: Right? 351 00:18:25,800 --> 00:18:29,080 Speaker 12: So, I think what Wall Street likes is the fact 352 00:18:29,080 --> 00:18:31,600 Speaker 12: that this is company is subscale, and it looks like 353 00:18:31,680 --> 00:18:35,480 Speaker 12: they're more likely to wish to win a bid for 354 00:18:35,720 --> 00:18:38,960 Speaker 12: Warner Brothers, which would then not make them subscale because 355 00:18:38,960 --> 00:18:41,840 Speaker 12: they would be like a third of total linear channels. 356 00:18:41,880 --> 00:18:46,080 Speaker 12: They've owned two of the largest film studios and so 357 00:18:46,400 --> 00:18:48,680 Speaker 12: and really their revenue was up two percent. They had 358 00:18:48,680 --> 00:18:51,560 Speaker 12: a lot of positive comments about UFC, which was their 359 00:18:52,200 --> 00:18:55,200 Speaker 12: top rated streaming channel, and streaming revenue is up seventeen 360 00:18:55,240 --> 00:18:58,840 Speaker 12: percent at Paramount Plus in the fourth quarter, and it 361 00:18:58,840 --> 00:19:03,040 Speaker 12: should so, I mean all of those numbers, fundamentally we're better. 362 00:19:03,040 --> 00:19:05,560 Speaker 12: At least this business is growing. Warner Brothers is shrinking, 363 00:19:05,640 --> 00:19:09,600 Speaker 12: but Paramount Peace Guy is growing still. 364 00:19:09,640 --> 00:19:11,440 Speaker 2: I think we'll get to Warner Brothers in a moment, 365 00:19:11,560 --> 00:19:14,200 Speaker 2: Like really simple question and it comes from a sincere place. 366 00:19:14,280 --> 00:19:16,639 Speaker 2: A lot of our audience have this based on what 367 00:19:16,680 --> 00:19:21,040 Speaker 2: you've just outlined with Paramount's guide. Once, what does doing 368 00:19:21,080 --> 00:19:24,720 Speaker 2: the deal with Warner Brothers Discovery the whole entirety of 369 00:19:24,760 --> 00:19:27,520 Speaker 2: it fix or improve or accelerate. 370 00:19:28,760 --> 00:19:32,200 Speaker 12: Okay, So if they don't win, if Netflix wins instead, 371 00:19:32,520 --> 00:19:35,600 Speaker 12: they're an eleven billion dollar market cap company and their 372 00:19:35,640 --> 00:19:38,760 Speaker 12: primary competitors will be Netflix, which if affuys Warner will 373 00:19:38,760 --> 00:19:42,560 Speaker 12: be a five hundred billion dollar market cap, and Amazon 374 00:19:42,560 --> 00:19:45,399 Speaker 12: and Google, which are three trillion dollars round numbers, So 375 00:19:45,520 --> 00:19:48,680 Speaker 12: it's competitive. It will be more subscale than it is today. 376 00:19:49,040 --> 00:19:53,240 Speaker 12: If it wins Warner Brothers, it suddenly combines and cut 377 00:19:53,320 --> 00:19:57,199 Speaker 12: costs from several of the largest streaming companies, several of 378 00:19:57,200 --> 00:19:59,720 Speaker 12: the largest. It will be thirty percent of total linear 379 00:20:00,160 --> 00:20:02,640 Speaker 12: TV ownership, and it will combine it will have two 380 00:20:02,640 --> 00:20:04,560 Speaker 12: of the biggest studios, so there's a lot of cost 381 00:20:04,600 --> 00:20:07,000 Speaker 12: cutting in that, and it will not be near a 382 00:20:07,080 --> 00:20:10,240 Speaker 12: subscale round numbers, it will be around the same size 383 00:20:10,400 --> 00:20:14,520 Speaker 12: as Disney and Netflix. If it wins Warners, so it 384 00:20:14,640 --> 00:20:19,080 Speaker 12: basically it basically makes it a legitimate competitor to those 385 00:20:19,119 --> 00:20:20,359 Speaker 12: other streaming companies. 386 00:20:20,520 --> 00:20:22,879 Speaker 3: And I think what Paramount's guide once Laura did in 387 00:20:22,920 --> 00:20:25,840 Speaker 3: its numbers was showed they can cut costs. And then 388 00:20:25,880 --> 00:20:27,960 Speaker 3: some Sunday, when it comes to the cable pot of 389 00:20:27,960 --> 00:20:35,520 Speaker 3: the business, how much does it need Warner Brother's Discovery. 390 00:20:35,800 --> 00:20:38,760 Speaker 12: So good question because price is the thing you're not asking, 391 00:20:38,800 --> 00:20:43,159 Speaker 12: but strategically it must have Warner Brothers Discovery. But of course, 392 00:20:43,359 --> 00:20:45,760 Speaker 12: you know, we do stocks and we do valuations, and 393 00:20:45,800 --> 00:20:49,720 Speaker 12: they're paying an awful premium for a shrinking business. As 394 00:20:49,760 --> 00:20:53,840 Speaker 12: you saw, like every single business segment, every single advertising 395 00:20:54,000 --> 00:20:57,639 Speaker 12: was down. You know, a lot a lot at Peace guys. 396 00:20:57,640 --> 00:21:00,800 Speaker 12: So some of their businesses at Warner Brothers are shrinking 397 00:21:01,320 --> 00:21:04,040 Speaker 12: or a lot of them are shrinking. Actually so I 398 00:21:04,040 --> 00:21:07,840 Speaker 12: mean they're buying a business is weakening fundamentally every single quarter, 399 00:21:07,880 --> 00:21:11,360 Speaker 12: and they're paying piece guys bidding higher and higher values, 400 00:21:11,800 --> 00:21:14,400 Speaker 12: which it implies they're not going to get a good 401 00:21:14,440 --> 00:21:16,399 Speaker 12: price on this asset because of the bidding more. 402 00:21:16,840 --> 00:21:20,720 Speaker 3: I mean, Laurie, you're all about the fundamentals, but are 403 00:21:20,760 --> 00:21:23,560 Speaker 3: we if they do have to pay over and above, 404 00:21:23,640 --> 00:21:25,400 Speaker 3: they have to go to thirty two dollars for Warner 405 00:21:25,400 --> 00:21:27,639 Speaker 3: by the discovery, is that a good deal fundamentally for 406 00:21:27,680 --> 00:21:31,040 Speaker 3: the business longer term, and given maybe Netflix happens to 407 00:21:31,040 --> 00:21:32,119 Speaker 3: be able to push them there. 408 00:21:33,560 --> 00:21:37,760 Speaker 12: You know, I think the answer is if they didn't 409 00:21:37,800 --> 00:21:41,840 Speaker 12: have a billionaire behind this, I cannot imagine a investor, 410 00:21:41,880 --> 00:21:44,560 Speaker 12: a you know, a venture capitalist, a private equity guy, 411 00:21:44,600 --> 00:21:47,800 Speaker 12: or public markets funding this stock price. But you've got 412 00:21:47,840 --> 00:21:50,840 Speaker 12: a billionaire sitting behind them and he can spend his 413 00:21:51,040 --> 00:21:52,800 Speaker 12: money the way he wants. 414 00:21:53,800 --> 00:21:57,000 Speaker 3: I'm talking Larry Ellison, that of David Ellison, of course 415 00:21:57,040 --> 00:21:59,159 Speaker 3: Laura Martin. So it's so great catching up with me. 416 00:21:59,320 --> 00:22:02,600 Speaker 3: Thank you from Needham and Co. Coming up more earnings. 417 00:22:02,840 --> 00:22:06,400 Speaker 3: How are results impacting the AI disruption fears that engulfed 418 00:22:06,440 --> 00:22:08,440 Speaker 3: this market, particularly in the area of software. 419 00:22:09,200 --> 00:22:10,400 Speaker 6: We're discussing that next. 420 00:22:10,400 --> 00:22:13,119 Speaker 3: We're also talking hardware and in video we've got to 421 00:22:13,160 --> 00:22:14,120 Speaker 3: talk about there. 422 00:22:14,640 --> 00:22:14,880 Speaker 6: Yeah. 423 00:22:14,960 --> 00:22:17,640 Speaker 2: Look, it's clearly having a drag on the market. We're 424 00:22:17,640 --> 00:22:19,399 Speaker 2: not down as much as we were, but it's still 425 00:22:19,440 --> 00:22:22,400 Speaker 2: down four percent, and like it is a sentiment change. 426 00:22:22,400 --> 00:22:25,560 Speaker 2: We've gone from basically muted on what was a be 427 00:22:25,800 --> 00:22:29,800 Speaker 2: even against bullish by side expectations to a very bearish 428 00:22:29,840 --> 00:22:33,520 Speaker 2: reaction to what Nvidia had to say about the durability 429 00:22:33,880 --> 00:22:36,360 Speaker 2: of this AI spend, and there is a lot more 430 00:22:36,359 --> 00:22:38,760 Speaker 2: to unpick, so much more analysis and reaction to come. 431 00:22:38,800 --> 00:22:41,040 Speaker 6: It is halftime and this is Bloomberg Tech. 432 00:22:50,720 --> 00:22:52,600 Speaker 3: Welcome back to Bloomberg Tech. It is a big day 433 00:22:52,600 --> 00:22:54,359 Speaker 3: in the markets because it's a big day of earnings 434 00:22:54,359 --> 00:22:56,399 Speaker 3: and the number one most valuable company in the world 435 00:22:56,600 --> 00:22:57,800 Speaker 3: has failed to impress. 436 00:22:57,880 --> 00:22:59,080 Speaker 6: What more is in Vidia to do? 437 00:22:59,280 --> 00:23:02,320 Speaker 3: So by three point nine percent, they saw seventy three 438 00:23:02,440 --> 00:23:05,280 Speaker 3: percent increase in revenue for the quarter that they posted 439 00:23:05,600 --> 00:23:08,000 Speaker 3: for a giant that is worth four point eight million dollars. 440 00:23:08,200 --> 00:23:10,639 Speaker 3: They say that that's going to accelerate to seventy eight percent. 441 00:23:10,800 --> 00:23:13,200 Speaker 3: They see margins that are expanding as well. But yet 442 00:23:13,240 --> 00:23:16,000 Speaker 3: the market isn't convinced, and still we see the stocks 443 00:23:16,080 --> 00:23:19,400 Speaker 3: roll over across the board when you're looking at AMD down, Broadcom, Micron, 444 00:23:19,800 --> 00:23:22,760 Speaker 3: the Force hardware lower. Let's look at software though, because 445 00:23:22,880 --> 00:23:25,359 Speaker 3: earnings have also been coming thick and fast. There both 446 00:23:25,440 --> 00:23:27,679 Speaker 3: actually in the green snowplink. We just had the CEO 447 00:23:27,800 --> 00:23:30,040 Speaker 3: one talking about how they're able to be at the 448 00:23:30,040 --> 00:23:34,040 Speaker 3: epicenter of the enterprise AI adoption and the now investors 449 00:23:34,080 --> 00:23:36,440 Speaker 3: believe that. But I'm looking at Salesforce managing to turn around. 450 00:23:36,440 --> 00:23:38,960 Speaker 3: It was down after the market yesterday. They post a 451 00:23:39,000 --> 00:23:41,960 Speaker 3: fifty billion dollar authorization to buy back shares. We're seeing 452 00:23:41,960 --> 00:23:43,840 Speaker 3: an adoption of Agent Force that is now an eight 453 00:23:43,960 --> 00:23:46,640 Speaker 3: hundred million dollar run rate, up from five hundred. We're 454 00:23:46,680 --> 00:23:48,639 Speaker 3: up two point five percent. But both of these stocks 455 00:23:48,680 --> 00:23:50,960 Speaker 3: have been battered over the course of the last few months. 456 00:23:51,000 --> 00:23:54,200 Speaker 2: The Okay, let's get more on Salesforce's earnings and speak 457 00:23:54,200 --> 00:23:56,679 Speaker 2: with Bloomberg's Brody Ford. In twenty four hours ago when 458 00:23:56,680 --> 00:23:58,480 Speaker 2: you're on the show, we were saying this is going 459 00:23:58,560 --> 00:24:02,879 Speaker 2: to be about them evidence seeing organic growth versus inorganic growth, 460 00:24:02,920 --> 00:24:06,080 Speaker 2: and actually that did come up. They talked about, actually, 461 00:24:06,119 --> 00:24:09,120 Speaker 2: you know, whatever's happening in AI, the thing that they're 462 00:24:09,119 --> 00:24:11,720 Speaker 2: offering will help them grow as opposed to just buying 463 00:24:11,800 --> 00:24:13,359 Speaker 2: up other companies that are growing fast. 464 00:24:13,560 --> 00:24:16,560 Speaker 13: Absolutely, so, I mean, the big concern is that the 465 00:24:16,680 --> 00:24:20,679 Speaker 13: core Salesforce products for let's say, managing your salesforce or 466 00:24:20,720 --> 00:24:24,440 Speaker 13: managing your service, these are slowing down quite a bit. 467 00:24:24,640 --> 00:24:27,320 Speaker 13: And so they're new AI tools. They are making some 468 00:24:27,440 --> 00:24:30,160 Speaker 13: money one hundred million dollars per year at this point. 469 00:24:30,960 --> 00:24:34,000 Speaker 13: Is that enough to offset the slowdown in the core business? 470 00:24:34,080 --> 00:24:35,760 Speaker 13: I mean, they're in the green today, but we have 471 00:24:35,840 --> 00:24:39,760 Speaker 13: to remember application software has been incredibly beat up this year, 472 00:24:39,800 --> 00:24:42,320 Speaker 13: and if you zoom that chart out, it's still not 473 00:24:42,400 --> 00:24:45,040 Speaker 13: an amazing picture as an ugly picture. 474 00:24:45,280 --> 00:24:46,879 Speaker 3: In fact, if you're looking over the course of the 475 00:24:46,920 --> 00:24:50,679 Speaker 3: last twelve months, Brody and in terms of Agent Force adoption, 476 00:24:50,800 --> 00:24:53,159 Speaker 3: in terms of that average revenue run rate, are we 477 00:24:53,280 --> 00:24:56,080 Speaker 3: seeing them being able to prove out that they're so intertwined. 478 00:24:56,119 --> 00:24:58,240 Speaker 3: No one's going to be forcing out the platform, and 479 00:24:58,280 --> 00:24:59,840 Speaker 3: it's more just a question of how much they can 480 00:25:00,080 --> 00:25:01,040 Speaker 3: much for it going forward. 481 00:25:02,760 --> 00:25:05,639 Speaker 13: They have proven at this point that agent Force is 482 00:25:05,680 --> 00:25:08,439 Speaker 13: a real product. People are paying for it. That was 483 00:25:08,480 --> 00:25:12,359 Speaker 13: an open question six twelve months ago. What's less clear 484 00:25:12,640 --> 00:25:16,520 Speaker 13: is do they have a ton of pricing leverage our 485 00:25:16,560 --> 00:25:19,680 Speaker 13: customers increasing total spend with salesforce? 486 00:25:19,800 --> 00:25:20,000 Speaker 5: Right? 487 00:25:20,080 --> 00:25:22,359 Speaker 13: I mean, is this a question of your spending money 488 00:25:22,400 --> 00:25:25,119 Speaker 13: on agent Force but you're not expanding your seats on 489 00:25:25,160 --> 00:25:28,480 Speaker 13: the core platform. The jury is still out on whether 490 00:25:29,040 --> 00:25:33,240 Speaker 13: generative AI means that leading platforms remain this kind of 491 00:25:33,359 --> 00:25:34,440 Speaker 13: center of gravity. 492 00:25:35,359 --> 00:25:38,560 Speaker 3: Ready forward, We thank you, as you always for talking 493 00:25:38,600 --> 00:25:40,520 Speaker 3: us through software. Let's talk about how the markets are 494 00:25:40,520 --> 00:25:42,600 Speaker 3: digesting all of these earnings. We're going to go back, 495 00:25:42,600 --> 00:25:44,600 Speaker 3: of course in videos results as well, with none of 496 00:25:44,600 --> 00:25:48,360 Speaker 3: them than Nancy Tegla CEO CIO Techno Investments, which joins 497 00:25:48,440 --> 00:25:51,080 Speaker 3: us on our birthday and also our super Bowl day 498 00:25:51,320 --> 00:25:53,879 Speaker 3: that is in video. But let's just start with software 499 00:25:53,880 --> 00:25:56,520 Speaker 3: for a minute. Nancy, what do you make of the 500 00:25:56,560 --> 00:25:59,600 Speaker 3: software numbers that we saw from CRM, that we see 501 00:25:59,600 --> 00:26:02,760 Speaker 3: from Snowflake as well. Did they manage to push back 502 00:26:02,800 --> 00:26:07,080 Speaker 3: on this disastrous fear engulfing the market that General to 503 00:26:07,119 --> 00:26:08,200 Speaker 3: AI is going to eat their lunch? 504 00:26:09,480 --> 00:26:14,760 Speaker 14: Yeah, thanks Caroline for mentioning my birthday. Goodness Saints pretending 505 00:26:14,800 --> 00:26:18,439 Speaker 14: like I don't have them anymore. I do think that 506 00:26:18,840 --> 00:26:22,080 Speaker 14: some of these companies are facing some really strong headwinds. 507 00:26:22,359 --> 00:26:25,440 Speaker 14: We got out of Salesforce a while ago, not because 508 00:26:25,480 --> 00:26:28,280 Speaker 14: we knew this narrative would prevail, but we just didn't 509 00:26:28,359 --> 00:26:32,160 Speaker 14: see an exciting growth trajectory for the company. We also 510 00:26:32,200 --> 00:26:34,800 Speaker 14: became a client. It was not a great experience, and 511 00:26:34,840 --> 00:26:38,879 Speaker 14: so we canceled our contract. But in terms of software 512 00:26:38,920 --> 00:26:41,560 Speaker 14: in general, I think some of these companies are going 513 00:26:41,640 --> 00:26:43,399 Speaker 14: to win. And I've talked with you in the past 514 00:26:43,440 --> 00:26:46,320 Speaker 14: about Service. Now we still own it. We added to 515 00:26:46,359 --> 00:26:49,440 Speaker 14: it recently. We think they are going to benefit from 516 00:26:49,440 --> 00:26:53,320 Speaker 14: better margins in the future because they're pivoting and vertically integrating. 517 00:26:53,600 --> 00:26:55,920 Speaker 14: But we got out of Adobe and that was because 518 00:26:55,960 --> 00:26:58,480 Speaker 14: we didn't see the company pivoting, and that was a 519 00:26:58,560 --> 00:26:59,400 Speaker 14: number of years ago. 520 00:27:00,080 --> 00:27:01,200 Speaker 8: About it over a year. 521 00:27:01,040 --> 00:27:04,159 Speaker 14: Ago, and so I think that's what investors have to 522 00:27:04,680 --> 00:27:07,359 Speaker 14: digest is who are going to be the winners? And 523 00:27:07,680 --> 00:27:10,360 Speaker 14: Salesforce will be in business, but they may not put 524 00:27:10,440 --> 00:27:12,359 Speaker 14: up the kind of growth numbers they've put in the past, 525 00:27:12,400 --> 00:27:14,240 Speaker 14: and we won't know for a couple of days because 526 00:27:14,359 --> 00:27:16,600 Speaker 14: it was down pre market, then it's shot up. 527 00:27:16,680 --> 00:27:17,880 Speaker 8: And now it's calling back. 528 00:27:18,000 --> 00:27:19,800 Speaker 14: So I think you have to wait for the hedge 529 00:27:19,800 --> 00:27:22,720 Speaker 14: funds and the algos to settle in and then we'll 530 00:27:22,720 --> 00:27:25,440 Speaker 14: see if investors come back to the name long term investors. 531 00:27:26,040 --> 00:27:28,280 Speaker 3: It's interesting, Natcy, you called out service. Now we know 532 00:27:28,320 --> 00:27:30,399 Speaker 3: that you've caught out before, and indeed Jensen Hang has 533 00:27:30,440 --> 00:27:35,119 Speaker 3: been on calling out service now himself. I'm the winner. Nazie, 534 00:27:35,200 --> 00:27:39,200 Speaker 3: go back to your own well experience with using the 535 00:27:39,240 --> 00:27:41,600 Speaker 3: Salesforce product. Why didn't you like it? Why didn't you 536 00:27:41,640 --> 00:27:44,600 Speaker 3: cut it? What was it that we're not getting offered? 537 00:27:44,840 --> 00:27:45,800 Speaker 3: That keeps it sticky. 538 00:27:47,000 --> 00:27:48,520 Speaker 8: So this is interesting, Caroline. 539 00:27:48,560 --> 00:27:51,240 Speaker 14: I think this is the story of this market. So 540 00:27:51,280 --> 00:27:55,479 Speaker 14: we were going to use it internally and as for 541 00:27:55,520 --> 00:27:56,720 Speaker 14: the obvious reason. 542 00:27:56,560 --> 00:27:57,920 Speaker 8: And it took almost a year. 543 00:27:58,000 --> 00:28:01,320 Speaker 14: They assign you to someone who helps you get set 544 00:28:01,400 --> 00:28:04,399 Speaker 14: up and customize the product. Before we were even up 545 00:28:04,440 --> 00:28:07,760 Speaker 14: and live, we had a price increase. It was very clunky. 546 00:28:07,920 --> 00:28:10,760 Speaker 14: It was not a smooth process. A lot of hard sell, 547 00:28:11,000 --> 00:28:13,680 Speaker 14: not a lot of delivery and service. We are shifting 548 00:28:13,760 --> 00:28:18,280 Speaker 14: our investment management software away from Advent to Ridgeline. Ridgeline 549 00:28:18,320 --> 00:28:22,720 Speaker 14: was founded, built from scratch, new technology, founded by David Duffield. 550 00:28:23,359 --> 00:28:24,200 Speaker 8: He made the pivot. 551 00:28:24,240 --> 00:28:26,720 Speaker 14: I mean he still obviously owns tons of shares in workday, 552 00:28:27,000 --> 00:28:29,919 Speaker 14: but that firm is a joy and a privilege to 553 00:28:30,040 --> 00:28:33,000 Speaker 14: work with. So I think that's what software providers are. 554 00:28:32,880 --> 00:28:35,399 Speaker 8: Going to have to do. They're going to have to. 555 00:28:34,920 --> 00:28:38,120 Speaker 14: Service and show that they add value to the underlying business. 556 00:28:38,920 --> 00:28:41,840 Speaker 2: There is a link here between that and Nvidia's earnings. 557 00:28:41,920 --> 00:28:43,920 Speaker 2: Your main takeaway from the call last night is the 558 00:28:43,960 --> 00:28:48,240 Speaker 2: same that we've been talking about all morning. Computes equals inference, 559 00:28:48,320 --> 00:28:51,240 Speaker 2: which equals revenues, and the way that Jensen Wong explained 560 00:28:51,280 --> 00:28:55,479 Speaker 2: that was profitable tokens. In other words, customers of all 561 00:28:55,560 --> 00:28:58,440 Speaker 2: kinds are willing to pay for the output of an 562 00:28:58,480 --> 00:29:01,600 Speaker 2: AI model, and that actually the economics have improved. The 563 00:29:01,680 --> 00:29:03,760 Speaker 2: thing is, I don't see any evidence of that in 564 00:29:03,800 --> 00:29:07,920 Speaker 2: any of the software company's earnings yet, do you not? 565 00:29:08,440 --> 00:29:08,680 Speaker 6: Yet? 566 00:29:08,720 --> 00:29:09,360 Speaker 8: I don't think so. 567 00:29:09,480 --> 00:29:11,800 Speaker 14: Part of that is capacity though, ed I mean, you 568 00:29:11,880 --> 00:29:15,320 Speaker 14: heard Microsoft say they took some of their own capacity, 569 00:29:15,360 --> 00:29:18,880 Speaker 14: but you heard them say and Amazon two, we can 570 00:29:18,920 --> 00:29:22,040 Speaker 14: fill whatever we get immediately in terms of demand, but 571 00:29:22,080 --> 00:29:25,280 Speaker 14: they don't have enough capacity. So I guess I would. 572 00:29:25,040 --> 00:29:25,920 Speaker 9: Look at it two ways. 573 00:29:25,960 --> 00:29:28,000 Speaker 14: One is, if you go back and look at Capex 574 00:29:28,080 --> 00:29:30,760 Speaker 14: in the nineties, it was about a two standard deviation 575 00:29:30,880 --> 00:29:34,200 Speaker 14: above the means spend in tech capex, we're not even 576 00:29:34,280 --> 00:29:38,000 Speaker 14: one standard deviation away from the mean. And one man's 577 00:29:38,360 --> 00:29:43,040 Speaker 14: Capex spend is another man's revenue. So AMD, Nvidia, broadcom 578 00:29:43,120 --> 00:29:45,640 Speaker 14: names we all own will continue to benefit. 579 00:29:45,760 --> 00:29:46,800 Speaker 8: And here's the last thing. 580 00:29:46,840 --> 00:29:50,880 Speaker 14: I'll say, sixty percent earnings growth at Nvidia, a pe 581 00:29:50,920 --> 00:29:54,240 Speaker 14: of somewhere around twenty three to twenty four Procter and Gamble, 582 00:29:54,360 --> 00:29:57,040 Speaker 14: two percent earnings growth on next year's earnings, and a 583 00:29:57,040 --> 00:30:00,200 Speaker 14: pe of twenty four, so I know which one I 584 00:30:00,280 --> 00:30:02,000 Speaker 14: want to own for the long term. But there's a 585 00:30:02,080 --> 00:30:04,520 Speaker 14: lot of trading going on. There's a lot of hiding 586 00:30:04,560 --> 00:30:07,520 Speaker 14: in the defensive names. That's what happens during this period. 587 00:30:07,640 --> 00:30:10,000 Speaker 14: It happened last year if you look at all these 588 00:30:10,080 --> 00:30:12,960 Speaker 14: names after Deep Seek, where we thought the world was ending. 589 00:30:13,120 --> 00:30:15,480 Speaker 14: I mean, we were buying a video at just over 590 00:30:15,520 --> 00:30:18,560 Speaker 14: one hundred dollars a share. That's still a good investment. 591 00:30:19,600 --> 00:30:22,360 Speaker 2: But you are in a video shareholder, I think you continued 592 00:30:22,400 --> 00:30:24,600 Speaker 2: to like the name. Right, So what was your big 593 00:30:24,640 --> 00:30:28,560 Speaker 2: takeaway from any of the earning sprint or the cool Yeah, 594 00:30:28,600 --> 00:30:29,160 Speaker 2: I think. 595 00:30:29,080 --> 00:30:31,720 Speaker 14: No one's really talking about the growth and Sovereign, which 596 00:30:31,760 --> 00:30:34,680 Speaker 14: is just getting started. So I understand it's a small 597 00:30:34,680 --> 00:30:38,440 Speaker 14: portion of total revenues. It was thirty billion dollars last quarter, 598 00:30:38,600 --> 00:30:41,360 Speaker 14: up three x a year over year, though. 599 00:30:41,400 --> 00:30:44,320 Speaker 6: And I think excluding China, right, yes. 600 00:30:44,600 --> 00:30:49,280 Speaker 14: Yes, excluding China, I think that's important and the company 601 00:30:49,320 --> 00:30:53,239 Speaker 14: It's just like when Tesla's megapack business got started, it 602 00:30:53,280 --> 00:30:56,520 Speaker 14: became the fastest growing, most profitable business. I think we 603 00:30:56,560 --> 00:31:00,479 Speaker 14: will continue to see these companies expand their reach and 604 00:31:00,600 --> 00:31:03,360 Speaker 14: more compute is going to be more demand and we 605 00:31:03,360 --> 00:31:05,400 Speaker 14: are going. You know, I think he made a really 606 00:31:05,480 --> 00:31:09,880 Speaker 14: interesting comment. What if or what what if? When we 607 00:31:09,960 --> 00:31:13,360 Speaker 14: have one hundred percent autonomous calls cars let's call it 608 00:31:13,400 --> 00:31:17,360 Speaker 14: fifty or even thirty five cars that are autonomous, the 609 00:31:17,440 --> 00:31:19,840 Speaker 14: compute demand is going to be great, and those data 610 00:31:19,840 --> 00:31:24,400 Speaker 14: centers in space while super intriguing intellectually and capture the imagination, 611 00:31:24,480 --> 00:31:25,959 Speaker 14: that's not going to happen very quickly. 612 00:31:27,160 --> 00:31:30,320 Speaker 2: Nancy Tengler from LAFA Tengler Investments, thank you very much. Now, 613 00:31:30,320 --> 00:31:32,640 Speaker 2: coming up more earnings, we're going to speak with chime 614 00:31:32,720 --> 00:31:35,840 Speaker 2: CEO Chris Britt following that company's report. 615 00:31:36,080 --> 00:31:45,640 Speaker 6: This is Bloomberg Tech Okay. 616 00:31:45,680 --> 00:31:48,520 Speaker 2: Shares of chime Or up almost eleven percent, more than 617 00:31:48,520 --> 00:31:51,120 Speaker 2: ten percent, on track for their best days since November 618 00:31:51,200 --> 00:31:54,360 Speaker 2: earlier in the session of almost seventeen percent, and on 619 00:31:54,440 --> 00:31:57,720 Speaker 2: track for their best day since the company ipoed last June. 620 00:31:57,720 --> 00:32:01,600 Speaker 2: The fintech firm issued guidance that toppden this expectations, driven 621 00:32:01,640 --> 00:32:05,240 Speaker 2: by rising user growth strong demand for digital banking products. 622 00:32:05,480 --> 00:32:08,560 Speaker 2: Chime CEO Chris Britt joins us, Now, actually, the other 623 00:32:08,560 --> 00:32:10,520 Speaker 2: thing you're getting a lot of credit for is a 624 00:32:10,560 --> 00:32:13,640 Speaker 2: technology story. A lot of the transition to your own 625 00:32:13,680 --> 00:32:17,280 Speaker 2: tech stack. How you've managed the company. You don't need 626 00:32:17,320 --> 00:32:20,600 Speaker 2: to grow headcount necessarily because of the focus and investment 627 00:32:20,640 --> 00:32:22,320 Speaker 2: you've made on take Do you mind if we start 628 00:32:22,360 --> 00:32:25,600 Speaker 2: with that and explain a bit about the strategy behind that. 629 00:32:26,800 --> 00:32:27,080 Speaker 6: Yeah. 630 00:32:27,120 --> 00:32:29,480 Speaker 8: Absolutely, And first of all, thanks for having me today. 631 00:32:29,520 --> 00:32:31,560 Speaker 5: I'm so proud of this team and the way that 632 00:32:31,600 --> 00:32:35,440 Speaker 5: we've executed. I think we're shipping faster than ever. And 633 00:32:36,440 --> 00:32:38,680 Speaker 5: you know, if you just think about this first year 634 00:32:38,800 --> 00:32:40,560 Speaker 5: of this is the first time we're reporting as a 635 00:32:40,560 --> 00:32:44,200 Speaker 5: public company our full year results, and they were outstanding. 636 00:32:44,240 --> 00:32:48,200 Speaker 5: You know, we added a million five new active members 637 00:32:48,240 --> 00:32:50,600 Speaker 5: who are now at nine point five million actives. We 638 00:32:50,640 --> 00:32:54,360 Speaker 5: took the company public, we launched a range of new products, 639 00:32:54,360 --> 00:32:57,520 Speaker 5: we launched a new business in our enterprise channel, and yes, 640 00:32:57,920 --> 00:33:01,560 Speaker 5: to your point, we completed the conversion of our core 641 00:33:01,640 --> 00:33:05,240 Speaker 5: processing and ledtering system onto our own in house tech stack, 642 00:33:05,320 --> 00:33:09,760 Speaker 5: top to bottom, and that's really unleashed not only lowered costs, 643 00:33:09,760 --> 00:33:12,520 Speaker 5: but also unleashed a whole set of new products and 644 00:33:12,560 --> 00:33:15,680 Speaker 5: services for our members. That drove awesome results for the 645 00:33:15,760 --> 00:33:19,280 Speaker 5: year of two point two billion dollars of top line revenue. 646 00:33:20,360 --> 00:33:21,160 Speaker 8: Growing up, we're. 647 00:33:21,040 --> 00:33:24,360 Speaker 5: Thirty percent and we got to a ten percent EBITA 648 00:33:24,480 --> 00:33:27,200 Speaker 5: margin in Q four, So feeling good across the board, 649 00:33:27,320 --> 00:33:30,360 Speaker 5: and this technology platform really is an enabler for our 650 00:33:30,400 --> 00:33:31,080 Speaker 5: future growth. 651 00:33:31,800 --> 00:33:34,080 Speaker 2: Last month I was on your own website. You did 652 00:33:34,080 --> 00:33:36,240 Speaker 2: this kind of blog post. It was what is chime? 653 00:33:36,560 --> 00:33:40,080 Speaker 2: Chime is not a bank, and if you consider, you 654 00:33:40,080 --> 00:33:42,600 Speaker 2: know what the products you're offering are a big part 655 00:33:42,840 --> 00:33:45,920 Speaker 2: of where the streets focused on is new products coming 656 00:33:45,920 --> 00:33:48,000 Speaker 2: to market and how you've monetized that. So you take 657 00:33:48,080 --> 00:33:51,680 Speaker 2: Chime card for example, through that lens, explain what you are, 658 00:33:52,000 --> 00:33:54,600 Speaker 2: but also how you've been able to launch a sort 659 00:33:54,600 --> 00:33:58,000 Speaker 2: of wider offering of financial services. 660 00:33:58,080 --> 00:33:59,520 Speaker 6: Is a fintech company. 661 00:34:00,520 --> 00:34:02,920 Speaker 8: Right, Chime at our core, we're a technology company. 662 00:34:02,960 --> 00:34:05,000 Speaker 5: We partner with banks, and so when you sign up 663 00:34:05,000 --> 00:34:07,800 Speaker 5: for a Chime account, think of it you're basically doing. 664 00:34:07,880 --> 00:34:12,000 Speaker 5: There's a three way relationship between the consumer, Chime as 665 00:34:12,000 --> 00:34:15,920 Speaker 5: the technology enabler and brand and the design and deliver 666 00:34:16,360 --> 00:34:19,719 Speaker 5: delivery of all the actual experience, and then the bank. 667 00:34:19,840 --> 00:34:22,799 Speaker 5: So we have some community bank partners that actually hold 668 00:34:22,800 --> 00:34:26,640 Speaker 5: the deposits in FDIC insured accounts for our members. And 669 00:34:26,680 --> 00:34:29,400 Speaker 5: this approach has worked really, really well, particularly for mainstream 670 00:34:29,400 --> 00:34:33,480 Speaker 5: American people that oftentimes live paycheck to paycheck, basically the 671 00:34:33,480 --> 00:34:36,080 Speaker 5: population that makes up to about one hundred thousand dollars 672 00:34:36,120 --> 00:34:38,040 Speaker 5: a year. That's the segment that we serve, and we 673 00:34:38,120 --> 00:34:42,440 Speaker 5: offer a range of core banking services, fee free checking accounts, 674 00:34:42,800 --> 00:34:45,040 Speaker 5: the ability to get access to short term lines of 675 00:34:45,120 --> 00:34:47,920 Speaker 5: credit at low cost or no cost, the ability to 676 00:34:47,920 --> 00:34:50,480 Speaker 5: build your credit and to earn high real savings. And 677 00:34:51,120 --> 00:34:54,319 Speaker 5: because we're a technology company, we don't have physical branches 678 00:34:55,400 --> 00:34:58,920 Speaker 5: and a heavy infrastructure physical infrastructure, we're able to operate 679 00:34:58,920 --> 00:35:01,360 Speaker 5: at a really low cost tr sure and we deliver 680 00:35:01,440 --> 00:35:04,600 Speaker 5: that value back to our consumers, and that's allowed us 681 00:35:04,600 --> 00:35:06,840 Speaker 5: to really outmaneuver the big banks. 682 00:35:06,880 --> 00:35:09,320 Speaker 8: We've been continuing to increase. 683 00:35:09,120 --> 00:35:14,320 Speaker 5: Our share of new accounts, new checking accounts in America, 684 00:35:14,440 --> 00:35:17,719 Speaker 5: and third party research continues to show that we are 685 00:35:17,760 --> 00:35:20,240 Speaker 5: having an outsized impact and increasing our share. 686 00:35:21,000 --> 00:35:23,320 Speaker 3: Let's go to swipe fees because that is where you 687 00:35:23,360 --> 00:35:26,760 Speaker 3: get a lot of the revenue. Is there any issue, 688 00:35:26,800 --> 00:35:29,400 Speaker 3: any concern longer terms you scale that will become a 689 00:35:29,440 --> 00:35:32,360 Speaker 3: regulatory issue as you hit certain benchmarks and pounds of 690 00:35:32,400 --> 00:35:34,320 Speaker 3: money that you manage. 691 00:35:34,520 --> 00:35:34,759 Speaker 9: Yeah. 692 00:35:34,800 --> 00:35:36,680 Speaker 5: I think as we've grown over the past few years, 693 00:35:36,680 --> 00:35:40,000 Speaker 5: you've seen an increasing balance in our business. So we 694 00:35:40,000 --> 00:35:45,279 Speaker 5: were historically very heavily reliant on fees that we learned 695 00:35:45,280 --> 00:35:49,480 Speaker 5: from Visa when our debit cards get used for everyday transactions, 696 00:35:50,080 --> 00:35:52,440 Speaker 5: and we've now have a secured. 697 00:35:52,080 --> 00:35:52,920 Speaker 8: Credit card product. 698 00:35:52,960 --> 00:35:56,080 Speaker 5: We launched a product called Chimed Card last year that's 699 00:35:56,120 --> 00:35:59,640 Speaker 5: a reward a secured card that has rewards, and that's 700 00:35:59,680 --> 00:36:02,800 Speaker 5: kind of change the game for everyday transactions in America 701 00:36:02,880 --> 00:36:07,400 Speaker 5: for average people, you know, average sort of mainstream consumers, 702 00:36:07,800 --> 00:36:12,880 Speaker 5: and so that's also contributing revenue line. And then increasingly 703 00:36:12,920 --> 00:36:18,279 Speaker 5: we have other services, our short term overdraft services, and 704 00:36:19,480 --> 00:36:22,080 Speaker 5: our my pay product has been announcedstanding you know, just 705 00:36:22,160 --> 00:36:24,040 Speaker 5: one year in. It's almost a half a billion dollar 706 00:36:24,520 --> 00:36:27,080 Speaker 5: revenue run rate. That allows our members to get access 707 00:36:27,120 --> 00:36:31,839 Speaker 5: to their paycheck essentially on demand, and that's also been 708 00:36:31,880 --> 00:36:35,439 Speaker 5: a nice added, some additional balance to our revenue mix. 709 00:36:36,320 --> 00:36:38,800 Speaker 3: I'm going to ask a sort of more complex and 710 00:36:39,239 --> 00:36:43,000 Speaker 3: maybe a more emotive question. In some way, You've talked 711 00:36:43,040 --> 00:36:45,480 Speaker 3: clearly about how your partnerships with banks. You're not the bank, 712 00:36:45,520 --> 00:36:47,279 Speaker 3: you're not taking the details of the customer in so 713 00:36:47,320 --> 00:36:49,440 Speaker 3: many ways. But there has been a consideration from the 714 00:36:49,440 --> 00:36:53,919 Speaker 3: Trump administration that maybe banks should collect citizenship. Now, given 715 00:36:53,960 --> 00:36:55,840 Speaker 3: the people that you serve at the moment, briefly, Chris, 716 00:36:55,960 --> 00:36:57,120 Speaker 3: is this an issue for you? 717 00:36:58,760 --> 00:37:00,000 Speaker 8: It's absolutely not an issue. 718 00:37:00,080 --> 00:37:03,400 Speaker 5: First of all, we open up FDIC insured checking accounts 719 00:37:03,440 --> 00:37:06,840 Speaker 5: in partnership with our bank partners, so we comply with 720 00:37:06,920 --> 00:37:10,400 Speaker 5: the rules and regulations that are required as occ chartered 721 00:37:10,800 --> 00:37:14,279 Speaker 5: banks that offer these FDIC insured accounts. So for every 722 00:37:14,360 --> 00:37:18,400 Speaker 5: new Chime member, we collect the full Social Security number 723 00:37:18,560 --> 00:37:21,880 Speaker 5: and comply with the Patriot Act and all of the 724 00:37:22,280 --> 00:37:25,080 Speaker 5: KYC requirements to open up a checking account. So this 725 00:37:26,320 --> 00:37:28,640 Speaker 5: any rule changes in this area have no impact on 726 00:37:28,680 --> 00:37:29,160 Speaker 5: our business. 727 00:37:29,680 --> 00:37:32,640 Speaker 3: I'm CEO Chris Britt. We thank you for joining us today. 728 00:37:33,120 --> 00:37:36,080 Speaker 3: Now coming up, we'll come back on today's big story 729 00:37:36,239 --> 00:37:39,600 Speaker 3: in video earnings. How investors are digesting the numbers at 730 00:37:39,600 --> 00:37:41,080 Speaker 3: the moment. You can see they're pushing down the stock 731 00:37:41,120 --> 00:37:42,640 Speaker 3: on the back of it. This is a blue bag tech. 732 00:37:46,280 --> 00:37:48,920 Speaker 15: Nvidia continues to surprise and delight the market. 733 00:37:49,040 --> 00:37:50,520 Speaker 8: Nvidia hit it out of the bar. Get again. 734 00:37:50,600 --> 00:37:52,480 Speaker 16: We saw phenomenal result. 735 00:37:52,640 --> 00:37:56,600 Speaker 15: It was a solid set of earnings and more importantly, 736 00:37:56,680 --> 00:37:59,359 Speaker 15: they had a very confident outlook for how that we're 737 00:37:59,360 --> 00:38:02,880 Speaker 15: going to sell more AI chips and data center product 738 00:38:03,000 --> 00:38:05,000 Speaker 15: going forward, and I think we're all looking forward to 739 00:38:05,000 --> 00:38:06,839 Speaker 15: seeing is that going to be a thing. 740 00:38:07,040 --> 00:38:10,640 Speaker 16: I think what was particularly maybe not surprising, but impressive 741 00:38:11,200 --> 00:38:13,320 Speaker 16: was seventy five percent growth you're owning, you're on the 742 00:38:13,360 --> 00:38:14,480 Speaker 16: data center space. 743 00:38:14,320 --> 00:38:15,319 Speaker 6: As the marketplace. 744 00:38:15,360 --> 00:38:19,400 Speaker 17: Tug of war over is the AI economy booming or 745 00:38:19,440 --> 00:38:23,560 Speaker 17: are there concerns around the A economy? And video continues 746 00:38:23,600 --> 00:38:26,480 Speaker 17: to be regardless of what you know, this debate is 747 00:38:26,800 --> 00:38:30,960 Speaker 17: concluding the stock just keeps getting cheaper and cheaper to 748 00:38:31,040 --> 00:38:34,960 Speaker 17: the point where it's becoming an obvious vibe. 749 00:38:35,160 --> 00:38:37,440 Speaker 16: They're still investing and these are going to, you know, 750 00:38:37,520 --> 00:38:39,799 Speaker 16: signal good times to come for in video in our. 751 00:38:39,680 --> 00:38:42,200 Speaker 15: Opinion, could it be any bigger than this? And they 752 00:38:42,200 --> 00:38:43,160 Speaker 15: basically said yes. 753 00:38:44,280 --> 00:38:47,640 Speaker 3: The reaction very positive from some of Bretting Big TV's 754 00:38:47,640 --> 00:38:50,600 Speaker 3: guests after in video posted. It's whopping numbers, but the 755 00:38:50,640 --> 00:38:53,560 Speaker 3: reaction in the shares is not or by four point 756 00:38:53,600 --> 00:38:55,959 Speaker 3: five percent, that's bring able to make equity reporter common 757 00:38:56,000 --> 00:38:58,640 Speaker 3: Rani King, but what your sources. 758 00:38:58,280 --> 00:38:58,879 Speaker 6: Are telling you? 759 00:38:58,960 --> 00:39:03,160 Speaker 3: Because the numbers with SELLA everyone agrees, So what more 760 00:39:03,160 --> 00:39:05,040 Speaker 3: were they not able to demonstrate? 761 00:39:05,400 --> 00:39:05,600 Speaker 6: Yeah? 762 00:39:05,640 --> 00:39:08,200 Speaker 18: What I'm hearing from investors is that they're really worried 763 00:39:08,239 --> 00:39:11,040 Speaker 18: about the cyclicality here. That's sort of what they're seeing is, 764 00:39:11,360 --> 00:39:14,040 Speaker 18: you know, the thing that might be still concerning people. 765 00:39:14,200 --> 00:39:17,200 Speaker 18: So obviously in Vidia continues to beat and raise, and 766 00:39:17,280 --> 00:39:19,520 Speaker 18: Johnson even said, you know, they think that, you know, 767 00:39:19,560 --> 00:39:22,560 Speaker 18: the hyperscialers are going to continue to spend, but investors 768 00:39:22,560 --> 00:39:24,239 Speaker 18: are worried about that. They're worried that that's going to 769 00:39:24,280 --> 00:39:26,960 Speaker 18: stop at some point and that then in Video will 770 00:39:27,000 --> 00:39:27,759 Speaker 18: be impacted. 771 00:39:28,760 --> 00:39:30,879 Speaker 2: Calm, and the market is now moving and the move 772 00:39:30,960 --> 00:39:33,520 Speaker 2: is significant. What are the single names that you're tracking 773 00:39:33,600 --> 00:39:36,120 Speaker 2: and what's the impact bim from in Nvidia's move lower. 774 00:39:36,880 --> 00:39:38,840 Speaker 18: Yeah, so obviously in Vidia is the big one, but 775 00:39:38,880 --> 00:39:41,759 Speaker 18: we're also looking at other chip makers, so shares of Broadcom, 776 00:39:42,120 --> 00:39:45,440 Speaker 18: Micron we're also down today. You know, they spiked with 777 00:39:45,480 --> 00:39:47,560 Speaker 18: in video sort of in after hours and then followed 778 00:39:47,600 --> 00:39:50,279 Speaker 18: them lower. The other thing that's really interesting today is 779 00:39:50,320 --> 00:39:53,439 Speaker 18: that software names are getting a little bit of buying here. 780 00:39:53,480 --> 00:39:56,360 Speaker 18: So we saw salesforce up that's a reverse from what 781 00:39:56,440 --> 00:39:59,400 Speaker 18: they're where they were after hours after their own earnings report. 782 00:39:59,520 --> 00:40:02,000 Speaker 18: And then we're seeing things like service now higher. So 783 00:40:02,360 --> 00:40:05,160 Speaker 18: that's interesting. We've obviously been seeing a lot of weakness 784 00:40:05,239 --> 00:40:08,120 Speaker 18: in software and maybe a little bit more strength on 785 00:40:08,440 --> 00:40:10,799 Speaker 18: you know, in the Nvidia side. All those shares have 786 00:40:10,800 --> 00:40:13,440 Speaker 18: been in range for quite some time, so seeing a 787 00:40:13,480 --> 00:40:15,680 Speaker 18: switch there today is really interesting. 788 00:40:15,880 --> 00:40:18,359 Speaker 3: Was interested in some parts of the supply chain or 789 00:40:18,600 --> 00:40:21,480 Speaker 3: other areas that have benefited from the AI capex spend 790 00:40:21,520 --> 00:40:24,480 Speaker 3: are still showing resilience. I'm looking at some song traded 791 00:40:24,520 --> 00:40:26,880 Speaker 3: in London, for example, is still holding on to gains. 792 00:40:27,080 --> 00:40:29,560 Speaker 3: Schaheinis had whopping day over in Asia. 793 00:40:29,640 --> 00:40:31,560 Speaker 6: So the still areas that resilient. 794 00:40:31,600 --> 00:40:33,800 Speaker 3: The optical part of the equation for example. 795 00:40:33,480 --> 00:40:35,399 Speaker 18: For sure, I think people still are looking at those 796 00:40:35,440 --> 00:40:37,640 Speaker 18: sort of second derivative picks and shovels, kind of the 797 00:40:37,680 --> 00:40:41,040 Speaker 18: other place where capex is going to be directed and saying, okay, 798 00:40:41,040 --> 00:40:43,319 Speaker 18: we still think that there is strength here. There's still 799 00:40:43,680 --> 00:40:46,760 Speaker 18: building data centers that's going to continue, and so maybe 800 00:40:46,800 --> 00:40:49,040 Speaker 18: moving into that piece of the puzzle a little bit more. 801 00:40:49,239 --> 00:40:52,760 Speaker 18: It's so interesting though, because Nvidia is getting really cheap. 802 00:40:53,200 --> 00:40:55,399 Speaker 18: That's something we're going to keep watching. I mean, it's 803 00:40:55,520 --> 00:40:58,320 Speaker 18: like twenty three times forward earnings. That's barely a premium 804 00:40:58,320 --> 00:40:59,759 Speaker 18: to the s and P five hundred. 805 00:41:00,280 --> 00:41:03,560 Speaker 2: Bimbos common Ranicky, thank you very much. Bloomberg Intelligence out 806 00:41:03,560 --> 00:41:06,439 Speaker 2: within video earnings reaction, noting the beats in the fourth quarter, 807 00:41:06,719 --> 00:41:09,799 Speaker 2: but more impressively that first quarter outlook, pointing to a 808 00:41:09,880 --> 00:41:13,160 Speaker 2: stronger ramp of the GB three hundred system. Bloomberg Intelligence 809 00:41:13,160 --> 00:41:16,480 Speaker 2: seen around this, congen Sabani with us. This was what 810 00:41:16,560 --> 00:41:20,000 Speaker 2: they used to explain margins, you know, the Blackwell ramp. 811 00:41:20,440 --> 00:41:22,840 Speaker 2: But then later this year we're going to get Vera Rubin. 812 00:41:22,880 --> 00:41:26,319 Speaker 2: There will be a transition of technology for their biggest customers. 813 00:41:26,520 --> 00:41:27,520 Speaker 6: How have you modeled for that. 814 00:41:27,920 --> 00:41:30,279 Speaker 19: Yeah, So usually at the start of a new product ramp, 815 00:41:30,360 --> 00:41:33,040 Speaker 19: your margins will get hit. But one key thing is 816 00:41:33,080 --> 00:41:36,720 Speaker 19: different this time is the ramp of improvement of margins 817 00:41:36,760 --> 00:41:38,879 Speaker 19: with the black Bel has been very impressive. We all 818 00:41:38,920 --> 00:41:41,360 Speaker 19: know about the rising memory cost, the rising wavefor and 819 00:41:41,400 --> 00:41:44,440 Speaker 19: package costs. Despite of that, and they don't pass on 820 00:41:44,480 --> 00:41:46,719 Speaker 19: the cost to their customer. Despite of that, they've been 821 00:41:46,760 --> 00:41:49,520 Speaker 19: able to hold that seventy five percent margins a software 822 00:41:49,560 --> 00:41:52,120 Speaker 19: level growth margin. So that speaks to two things. Their 823 00:41:52,160 --> 00:41:55,400 Speaker 19: pricing power and that ability to optimize for costs in 824 00:41:55,440 --> 00:41:59,080 Speaker 19: their supply chain. Hence that large purchase commitment increase, which 825 00:41:59,120 --> 00:42:02,279 Speaker 19: really lets them employ their balance sheet in their supply chain. 826 00:42:02,600 --> 00:42:05,160 Speaker 3: I mean it's even the costs that they identify for 827 00:42:05,280 --> 00:42:08,160 Speaker 3: stock recompense to those that work for them. I mean 828 00:42:08,200 --> 00:42:10,640 Speaker 3: people saying, that's a really classy act from the CFO, 829 00:42:10,719 --> 00:42:13,759 Speaker 3: from investor relations to be making that clear within the 830 00:42:13,920 --> 00:42:18,360 Speaker 3: gap numbers congin. But where therefore are we lacking clarity? 831 00:42:18,719 --> 00:42:21,680 Speaker 3: Is it from the China perspective? Is it future build? 832 00:42:21,880 --> 00:42:23,959 Speaker 3: Where did we need a little bit more? 833 00:42:26,040 --> 00:42:28,359 Speaker 19: I couldn't find anything negative in this print. I mean, 834 00:42:28,440 --> 00:42:31,400 Speaker 19: looking at by set expectations, it very clearly cleared the 835 00:42:31,400 --> 00:42:34,239 Speaker 19: most lofty bogies on the byside. I think this is 836 00:42:34,360 --> 00:42:37,319 Speaker 19: just the reaction seems to be overall AI fritig on 837 00:42:37,320 --> 00:42:39,920 Speaker 19: one end, when the top five customers who are raising 838 00:42:39,920 --> 00:42:42,960 Speaker 19: CAPEX targets are being punished for spending that money. You 839 00:42:43,000 --> 00:42:45,920 Speaker 19: can't have it both ways, where the company that's capturing 840 00:42:45,960 --> 00:42:50,320 Speaker 19: all that revenue also does not gets rewarded for taking 841 00:42:50,520 --> 00:42:51,640 Speaker 19: a lot of that high spend. 842 00:42:51,480 --> 00:42:54,480 Speaker 2: Which is very quickly networking provided a lot of the 843 00:42:54,520 --> 00:42:55,759 Speaker 2: outside just explain it. 844 00:42:56,239 --> 00:42:58,719 Speaker 19: Yeah, you know, people have people don't pay it. A 845 00:42:58,719 --> 00:43:01,040 Speaker 19: lot of attention to the networking. But networking has been 846 00:43:01,080 --> 00:43:04,359 Speaker 19: surpassing expeditions every single quarter, and I think it will 847 00:43:04,520 --> 00:43:07,399 Speaker 19: greatly because now they're networking, they can sell it even 848 00:43:07,400 --> 00:43:08,000 Speaker 19: where their. 849 00:43:07,880 --> 00:43:08,680 Speaker 6: GPUs don't go. 850 00:43:08,960 --> 00:43:11,560 Speaker 19: So even like a six for an Amazon, which are 851 00:43:11,560 --> 00:43:13,560 Speaker 19: supposed to be growing and taking share away from the 852 00:43:13,640 --> 00:43:16,880 Speaker 19: Nvidia GPUs, they're going to plug it with Nvidia networking. 853 00:43:16,920 --> 00:43:18,960 Speaker 19: So that's a new source of revenue even where they 854 00:43:19,000 --> 00:43:20,560 Speaker 19: don't have the chips in the servers. 855 00:43:21,000 --> 00:43:24,480 Speaker 3: Qunjian Savani is a bullish take from Bloomberg Intelligence, just 856 00:43:24,520 --> 00:43:26,000 Speaker 3: not a bullish reaction on the stock. 857 00:43:26,080 --> 00:43:26,520 Speaker 6: That does it. 858 00:43:26,560 --> 00:43:29,759 Speaker 3: For this edition of Bloomberg Tech, Extraordinary day on these 859 00:43:29,760 --> 00:43:31,160 Speaker 3: market seat, Yeah. 860 00:43:31,080 --> 00:43:33,440 Speaker 2: We have reaction from the cell side, from the byside 861 00:43:33,480 --> 00:43:35,440 Speaker 2: and in house, the reporting of the things you need 862 00:43:35,480 --> 00:43:38,000 Speaker 2: to know. Recap that on the podcast. You know where 863 00:43:38,000 --> 00:43:40,680 Speaker 2: to find it. It's from the Bloomberg terminal and online 864 00:43:40,760 --> 00:43:43,080 Speaker 2: on Apple, Spotify and Ihea. 865 00:43:43,640 --> 00:43:44,680 Speaker 6: This is Bloomberg Tech