Speaker 1: From the heart of where innovation, money, and power collide
Speaker 1: in Silicon Valley and beyond. This is Bloomberg Technology with
Speaker 1: Caroline Hyde and.
Speaker 2: Ed Ludlow.
Speaker 3: Live from New York and San Francisco. This is Bloomberg
Speaker 3: Technology coming up. President Trump asks Apple CEO to move
Speaker 3: iPhone production from India to the US market.
Speaker 4: Plus the core we've CEO joins on the back of
Speaker 4: the company's first earnings as a public company.
Speaker 3: And the CEO of e Toro joins US after its
Speaker 3: upsized US share sale as the IPO market opens back up.
Speaker 5: But first we.
Speaker 3: Check in on this market, which maybe it's just got
Speaker 3: a little bit over exuberant and dials back on the
Speaker 3: day we hit overbought technical overbought territory on the relative
Speaker 3: strength index when you're looking at the NASZAK one hundred yesterday.
Speaker 3: Today we've paired back only by three tenser percent. Ed
Speaker 3: were on track for a five percent gain so far
Speaker 3: this week, and it seems as though big tech just
Speaker 3: comes off as some of those highs as the macro
Speaker 3: data paints maybe a slightly cooler inflation environment than.
Speaker 5: We were thinking.
Speaker 4: We see the same behavior in Apple, which is our
Speaker 4: top story muted declines, pairing some of its more significant
Speaker 4: declines earlier on High's US listed shares. That's the publicly
Speaker 4: traded arm of fox Conn, the company assembling the iPhone
Speaker 4: softer in.
Speaker 6: Part and earning story but in part.
Speaker 4: The President of the United States, with severe words for
Speaker 4: Apple and Tim Kirk, listened to this.
Speaker 7: I had a little problem with Tim Koky yesterday. I
Speaker 7: said to him, Jimy and my friend I Fru did
Speaker 7: you very good? You're coming here with five hundred billion dollars,
Speaker 7: but now here you're building all over India.
Speaker 8: I don't want your building in Indie.
Speaker 5: Let's get straight to it.
Speaker 3: Bloomberg's Mark Gumman gives us the context because before we
Speaker 3: go as to how realistic this could be, Mark, I
Speaker 3: want to understand for our audience just how much we've
Speaker 3: seen production shift to India to satisfy the US market.
Speaker 2: Yeah, thank you so much for having me.
Speaker 9: These are truly, you know, some harsh comments coming from
Speaker 9: President Trump.
Speaker 2: Obviously, Tim Cook.
Speaker 9: Has had no choice because of the thread of tariffs
Speaker 9: to move a lot of production of the iPhone and
Speaker 9: other devices to elsewhere. Right, So, for the most part,
Speaker 9: they were building things in China, but now they're building
Speaker 9: probably a third of iPhones in India.
Speaker 2: They set on the.
Speaker 9: Earnings call that the majority of iPhone production for the
Speaker 9: US market in this coming quarter is going to be
Speaker 9: done in India. They certainly have aggressive plans to expand
Speaker 9: even further in India for iPhone production.
Speaker 6: Again, that's for.
Speaker 9: The US market, and this is about avoiding trade war
Speaker 9: type of situations between the US and China, geopolitical issues
Speaker 9: having to do with China, but also because of these tariffs.
Speaker 9: A lot of this came into place because of the
Speaker 9: anticipation of these tariffs and how much more it would
Speaker 9: cost Apple to produce iPhones and how much that would
Speaker 9: snip into their margins if they continued to export from
Speaker 9: China to the US. So definitely something Apple had to do,
Speaker 9: and it's understandable that with Donald Trump's agenda, why he
Speaker 9: would not be so happy about it.
Speaker 4: Mark, I want to recap some of the data you
Speaker 4: just shared, which is that basically almost ninety percent of
Speaker 4: iPhones are currently made in China and the balance of
Speaker 4: iPhones are made in India around thirty million units per annum.
Speaker 4: Did we learn anything from Apple's most recent earnings or
Speaker 4: in any of your reporting since on how Apple is
Speaker 4: planning for the long term on its production of the iPhone,
Speaker 4: irrespective of what the White House says.
Speaker 9: Well, right now, the plan is to produce the vast
Speaker 9: majority of iPhones in India for the US market by
Speaker 9: the end of twenty twenty six, so about a year
Speaker 9: and a half from now. There's still going to be
Speaker 9: a nice chunk of iPhones made in China, that is
Speaker 9: the higher end pro models. They're working on basically two
Speaker 9: new iPhone models for the twentieth anniversary. Obviously, Steve Jobs
Speaker 9: unveiled the first iPhone at the beginning of two thousand
Speaker 9: and seven, so across the end of twenty twenty six
Speaker 9: and the end of twenty two they have two major
Speaker 9: new iPhones coming out. They have a foldable iPhone which
Speaker 9: would compete with the Samsung Fold, the Google Pixel Phone,
Speaker 9: some of the other Chinese made foldables.
Speaker 2: They also have a.
Speaker 9: Twentieth anniversary glass wingd phone coming out at the end
Speaker 9: of twenty twenty seven. Uses very advanced curve glass, very
Speaker 9: advanced new chips, very advanced new technology. They're not going
Speaker 9: to be able to pull that off outside of China,
Speaker 9: so those aren't coming to India from the get go.
Speaker 9: But to I guess the larger points, there is no
Speaker 9: plan in place to begin building iPhones in the United States.
Speaker 9: I have an article that I wrote in early April
Speaker 9: which outlines why this one happened. The engineering talent, the
Speaker 9: manufacturing skill sets, the manufacturing space, the cost implicacations, all
Speaker 9: of that essentially makes it imposs impossible for Apple to
Speaker 9: produce iPhones in the US at any rational, reasonable rate
Speaker 9: or scale.
Speaker 6: Bloomber's Mark German, thank you very much.
Speaker 4: Let's get more with Bloomberg's Mike Shephard and the political
Speaker 4: side of this story in Washington, d C.
Speaker 6: And Mike.
Speaker 4: In the last forty eight hours, the President has taken
Speaker 4: to the stage, so to speak, and called out Jensen Wang,
Speaker 4: the Nvidia CEO.
Speaker 6: He called him my friend who's in the room.
Speaker 4: Twenty four to forty eight hours later, he calls out
Speaker 4: Apple CEO Tim Cook with less kind words. This is
Speaker 4: a president who is using the public forum to try
Speaker 4: and get tech companies, American tech companies, to do things
Speaker 4: his administration wants.
Speaker 6: Well, that's right, ed.
Speaker 10: He is using the public space to pressure these companies,
Speaker 10: and he is not shy about doing it. And It
Speaker 10: is a tactic we have seen before. Think back to
Speaker 10: the very early days of the administration when SoftBank was
Speaker 10: pledging one hundred billion dollars of investment in the US
Speaker 10: and Donald Trump turned to Marseoshi's son. This may have
Speaker 10: even been before.
Speaker 6: He took office.
Speaker 10: How about doubling it? Could you make it two hundred
Speaker 10: billion dollars? Right there as the two men were standing
Speaker 10: at a lectern with the announcement being made. And it
Speaker 10: is a tactic we have seen repeatedly. When the Stargate
Speaker 10: announcement was made again, he was asking one hundred billion,
Speaker 10: Why can't we make it five hundred billion, Let's scale
Speaker 10: it up. And so the president really is pushing companies
Speaker 10: to help fulfill his agenda here, which is the expanding
Speaker 10: manufacturing base, and he is leaning heavily in the tech
Speaker 10: industry to do so. Obviously, others like aviation and car
Speaker 10: making too are feeling that pressure. But tech is really
Speaker 10: taking center stage in this and you can see that
Speaker 10: with the connections he's tried to make, as you mentioned
Speaker 10: ed with Jensen Wong and of course with Tim Cook,
Speaker 10: someone he's had a relationship with since the first administration,
Speaker 10: and Mike Thus for.
Speaker 3: Tim Cook or Apple indeed has not responded publicly to
Speaker 3: the President's comments, but they have front run perhaps the
Speaker 3: president's comments in terms of trying to signal the investment
Speaker 3: to come five hundred billion dollars. They say that was
Speaker 3: going to be invested in the US. But that's the
Speaker 3: chips or indeed the AI focus. It's not for making iPhones. Realistically,
Speaker 3: are we going to see Apple try and respond by
Speaker 3: more investment but just not in terms of iPhone production.
Speaker 2: Well, it's a difficult question.
Speaker 10: That President made very clear what he wanted. He wants
Speaker 10: US phones made here in the US and not in
Speaker 10: India and not in China certainly, and to do that,
Speaker 10: perhaps Donald Trump needs to read Mark German's piece from
Speaker 10: back in April laying out all of the difficulties, but
Speaker 10: of course the fine print, those kinds of details. The
Speaker 10: President typically has not paid attention to that. And it
Speaker 10: is up to companies really to use the time that
Speaker 10: they get with Donald Trump and his aids to show Look,
Speaker 10: it will be very difficult to do this. This is
Speaker 10: what the cost would be. Some officials have talked about, well,
Speaker 10: maybe there could be some savings when it comes to AI.
Speaker 10: When it comes to processes. And yet here also we
Speaker 10: do have a talent deficit. We don't nearly have enough
Speaker 10: engineers and assembly line talent to be able to produce
Speaker 10: the vast number of iPhones for the US market that
Speaker 10: are currently planned right now in India.
Speaker 5: Michael sheppind great to check in with you. Thank you.
Speaker 3: Meanwhile, let's return to what President Trump has managed to
Speaker 3: achieve for in video in the like, for example, in
Speaker 3: the Middle East, the tour is opening up though a
Speaker 3: rift within his own administration, Trump's aideals. They're raising alarm
Speaker 3: bells for China hawks in particular concerns growth that the
Speaker 3: projects could put US national security and economic interest at risk.
Speaker 5: Let's bring in Ridy Griffin, who joins us for more.
Speaker 3: This is a really well read story at the moment,
Speaker 3: and this is all to do with basically, how we
Speaker 3: ensure that in video chips going to the Middle East
Speaker 3: don't end up in China's hands.
Speaker 11: Yes, we've seen this week in speaking with several Trump
Speaker 11: administration officials, that they are quite uncomfortable with the fast
Speaker 11: and loose way that these negotiations have happened. And particularly
Speaker 11: we're interested to see that there is concern about the
Speaker 11: way White House AI advisor David Sachs is a part
Speaker 11: of these negotiations. Trump administration officials feel that he is
Speaker 11: not paying sensitive attention to the economic and national security
Speaker 11: concerns that you mentioned.
Speaker 4: I think it's important to explain to the audience the
Speaker 4: basics of the relationships between these nations. The original AI
Speaker 4: diffusion rule took into account third countries, right, which was
Speaker 4: the idea that if you sell a technology to a
Speaker 4: nation like Saudi Arabia or the UAE, those nations also
Speaker 4: have a close relationship with China, an economic relationship. There
Speaker 4: are Chinese nationals working in the fields of AI and UAE,
Speaker 4: for example, and that they might give access indirectly to
Speaker 4: China to US technology. Has the US actually answered any
Speaker 4: of that in everything that's happened in the last four days.
Speaker 11: What's amazing is that the diffusion rule itself has been
Speaker 11: under review in a way, these negotiations have front run
Speaker 11: the answer to that question ed, and we're seeing Congressional
Speaker 11: Republicans raise concerns about this process as well. This isn't
Speaker 11: just happening behind closed doors. It's being discussed out in
Speaker 11: the open. But there are two sides of the Trump
Speaker 11: administration one in which we're seeing concerns about these chips
Speaker 11: simply being in other countries potentially threatening American dominance.
Speaker 5: But David Sachs.
Speaker 11: Himself, the AI White House Advisor, believes and has said
Speaker 11: publicly that having American technology being used abroad helps to
Speaker 11: ensure the dominance, helps to ensure that country's returning to
Speaker 11: China for that same technology.
Speaker 4: One example, G forty two, an investment firm focused on
Speaker 4: AI that has close links not just to the nation
Speaker 4: of China in UAE, but also a relationship with Huawei,
Speaker 4: the national tech champion.
Speaker 6: Bluembo's Riley Griffin top reporting. Thank you very much.
Speaker 3: Core Weave shares pushing higher today the posting the earnings
Speaker 3: after the bell yesterday. There were some concerns around profitability
Speaker 3: the forecast, but really this is as Core Weave works
Speaker 3: to bring forward spending in an effort to meet consumer demand.
Speaker 3: That is just ratcheting higher and higher. Core we CEO
Speaker 3: Michael Entrator joins us now on the back of yet
Speaker 3: a deepening tie up with Open Ai. Their own ed
Speaker 3: Ludlow has been writting about a deal worth yet another
Speaker 3: four billion dollars. You'd already sealed revenue climbing to some
Speaker 3: eleven billion deal with them previously. Michael, are we seeing
Speaker 3: insatiable demand and how can you meet it?
Speaker 7: Yeah?
Speaker 8: Thank you for having me on. The demand for the
Speaker 8: product that we deliver has truly been INSATIONI it. You know,
Speaker 8: it's resulted on us having an opportunity to beat our
Speaker 8: guidance and raise our guidance for the year and beat
Speaker 8: our earnings for the quarter. You know, as we continue
Speaker 8: to try to pull in infrastructure so that we can
Speaker 8: deliver it to our clients that need the type of
Speaker 8: software stack, that need the type of compute that we
Speaker 8: deliver in order to drive their products into the market.
Speaker 3: I want to just pick up on the beat because wow,
Speaker 3: did you beat in terms of revenue and certainly we
Speaker 3: see what four hundred percent growth is extraordinary, But talk
Speaker 3: to us about the fore cost and profitability because the
Speaker 3: area of investor concern is ultimately your capital expenditure. You're
Speaker 3: having to raise capital spending to what to twenty three
Speaker 3: billion dollars? Just vindicate that for the market.
Speaker 8: Sure, Look, you know the structure of our business is
Speaker 8: built around the idea that we have success based finance,
Speaker 8: and so when you see us go out to the
Speaker 8: market and raise our capital budget for the year. You're
Speaker 8: seeing us raise money to fulfill our obligations under signed
Speaker 8: contracts for off take agreements. It's really a wonderful indication
Speaker 8: of the demand for our product and our unique ability
Speaker 8: to deliver such a performance solution to how you drive
Speaker 8: compute into the artificial intelligence ecosystem. It's really been a
Speaker 8: you know, it's a it's an interesting aspect of the
Speaker 8: business that we've put together, but the increase in capital
Speaker 8: is representative of the client demand.
Speaker 4: Michael, I think the sole outstanding question the industry has
Speaker 4: for Corewave is what is the proportion of workload you're
Speaker 4: running that is inference versus the proportion of workload you're.
Speaker 6: Running that is training.
Speaker 4: They're searching for a very specific number, and we can
Speaker 4: get into why.
Speaker 11: Yeah, so.
Speaker 8: I'm going to disagree with you. I'm going to say
Speaker 8: there's a few more questions that we're still working through
Speaker 8: I've got. But look, you know I said this on
Speaker 8: yesterday's earnings call, right, there is no trend that makes
Speaker 8: me more excited about the prospects of our business than
Speaker 8: the continued increase and velocity of inference Because at the
Speaker 8: end of the day. What inference represents is the monetization
Speaker 8: of all of the investment that going on into artificial intelligence.
Speaker 8: It is a representation of the AI labs, of the
Speaker 8: enterprise clients that have invested enormous sums of money into
Speaker 8: the compute, into the software, into all the aspects of it,
Speaker 8: actually turning it on and having clients use it to
Speaker 8: improve the quality of their products delivered to their clients.
Speaker 8: It is by far the most important trend that I
Speaker 8: watch every day.
Speaker 4: This is your first quarter as a public company, right,
Speaker 4: and if you scale back to the basics, it's buying
Speaker 4: GPUs and renting out the GPUs and that becomes a
Speaker 4: little bit like a low margin commoditized business. Primer facie.
Speaker 4: What is it that you're doing that's the value add
Speaker 4: What is it? It's making data centers more efficient now.
Speaker 8: So this is one of the kind of recurring trends
Speaker 8: is that people trying to understand the compute requirements for
Speaker 8: artificial intelligence are relying on the best proxy they have,
Speaker 8: and that is the legacy cloud, and they're looking at
Speaker 8: it and thinking about it as if it is a
Speaker 8: commodity service. The reason that these clients, the reason the
Speaker 8: most demanding consumers of this infrastructure come to core Weave
Speaker 8: is because of the way that we integrate the commodity
Speaker 8: hardware into our specific software solution, which extracts such incredible
Speaker 8: performance games and makes it so incredibly effective to build models,
Speaker 8: to run models, to be able to ultimately build their business.
Speaker 8: It is not a commodity. It's really difficult to run
Speaker 8: this infrastructure. It's really difficult to build this infrastructure. And
Speaker 8: Corewave's entire business, truly from the data center all the
Speaker 8: way up through the software stack, has been built around
Speaker 8: the concept that we are decommoditizing it, that we are
Speaker 8: providing enormous value on top of the compute. Our latest
Speaker 8: acquisition of Weights and Bias that's a great example of
Speaker 8: how our software stack will fundamentally decommoditize the products that
Speaker 8: we're delivering and imbue the products that we have with incredible.
Speaker 4: Vale cour We've CEO Michael and Traded. It's great to
Speaker 4: have you on Bloomberg Technology. Congrats on your first quarter
Speaker 4: as a public company. We want to welcome our worldwide
Speaker 4: TV and radio audiences. We look at shares of an
Speaker 4: investment platform e Toro stabilizing a little bit after a
Speaker 4: pretty hyperbolic debut in public markets. Yesterday the competitors robin
Speaker 4: Hood began publicly trading at fifty two dollars to share
Speaker 4: the upsize IPO raised raised nearly six hundred and twenty
Speaker 4: million dollars for companies and investors.
Speaker 6: Were joined now by Utro's CEO.
Speaker 4: Say, for both Caroline and I, it's a little bit
Speaker 4: of a sort of full circle story because I'd say,
Speaker 4: over the last day, cad or more it TOI is
Speaker 4: a company we probably most consistently talked about. Finally you've
Speaker 4: gone public. Actually, when chair started trading it was well
Speaker 4: above fifty two bucks.
Speaker 6: How does that feel for you?
Speaker 12: It's an amazing feeling, you know, the last two weeks
Speaker 12: on the road show, being inside capital markets here in
Speaker 12: the US, now listing on ASDAK, a super exciting journey.
Speaker 12: Eighteen years in the making of building Etro, the world's
Speaker 12: largest social investment network. Can now our customers can trade
Speaker 12: Toro on Ititorro.
Speaker 4: Educate the audience that doesn't necessarily know about Etro. What
Speaker 4: is the proportion of stock activity on the platform versus
Speaker 4: say crypto, What is the mainstay of your business?
Speaker 12: So we're doing both customers today on it Toro can
Speaker 12: trade stocks from over twenty different capital markets as well
Speaker 12: as more than one hundred and thirty different assets. We
Speaker 12: started the business in Europe and the UK. Our largest
Speaker 12: markets spend into Asia, UA and now the US as well.
Speaker 12: And our customers when they trade, they share of their
Speaker 12: trading activity and you can actually see the portfolios in
Speaker 12: the trek record of our customers, and you can automatically
Speaker 12: copy the most successful investors on the platform. So it's
Speaker 12: not only about trading yourself both crypto and stocks. It's
Speaker 12: about being able to see others that are successful and
Speaker 12: copy them automatically. And the ratio between stocks and crypto
Speaker 12: changes in market dynamics. Last year, twenty five percent of
Speaker 12: total net contribution was actually crypto trading activity. Years when
Speaker 12: crypto was in a bull run like before. Sometimes it's
Speaker 12: up to sixty two percent, so it really changes with
Speaker 12: the markets.
Speaker 3: We keep comparing you to Robin Hood and at the moment,
Speaker 3: I mean you have a social nature of course, spelling
Speaker 3: out in the way that you can copy those and.
Speaker 5: Invest like them. But with Robin Head at a.
Speaker 3: Fifty two billion market cap and yourself at a five
Speaker 3: billion as it currently stands.
Speaker 5: How do you close that gap?
Speaker 3: How do you show that you're more closing terms of competitors.
Speaker 12: I think eventually a lot of great companies are aiming
Speaker 12: at a very very big opportunity, which is the largest
Speaker 12: generational transformation of wealth in history. Eighty four trillion dollars
Speaker 12: here in the US are going to move from older
Speaker 12: generations to younger generations. In Europe not that far behind,
Speaker 12: sixty trillion dollars are going to move from older generations
Speaker 12: to younger generations. And I believe that our generation expects
Speaker 12: to trade, invest, and save in a digital native solution.
Speaker 12: And we're providing more than just the ability to trade
Speaker 12: directly in the markets through the copy trading pattern of technology.
Speaker 12: We provide people to automatically copy top investors from all
Speaker 12: around the world, as well as more than one hundred
Speaker 12: different smart portfolios, where we actually have our own chief
Speaker 12: investment office with sixteen market analysts across the globe who
Speaker 12: help our customers basically find portfolios like Thematics driverless cars.
Speaker 12: We're just launching our also market neutral strategies learning from
Speaker 12: the hedge funds I met here in New York. So
Speaker 12: we're able to create more than just self directed trading,
Speaker 12: but actually the entire world of investments through smart portfolios
Speaker 12: and copy.
Speaker 3: Trader, and that's as the business model MATURESI it's interesting
Speaker 3: that you sort of said you've got yourself to a
Speaker 3: more mature state than back in say twenty twenty one,
Speaker 3: when you were looking at going public virus back. Just
Speaker 3: tell us how different it looks now. What happened then
Speaker 3: to make you push to go for an IPO this time?
Speaker 12: I think you know, we call twenty twenty two the
Speaker 12: year of education. A lot of our customers learned that
Speaker 12: markets don't always go up. And we were focused initially
Speaker 12: in twenty twenty one we need growth at all costs,
Speaker 12: strategy very sort of VC minded, let's just spend money
Speaker 12: to grow. And I think what twenty twenty two to
Speaker 12: us is to change our strategy to profitable growth. And
Speaker 12: we've significantly scale up profitability in it Toro with more
Speaker 12: than three hundred million dollars of adjusted to be the profit.
Speaker 12: So I think that's the significant transition that we've done
Speaker 12: in the private market bring us to profitable growth, which
Speaker 12: is a strategy that I believe is more fit to
Speaker 12: public markets.
Speaker 3: There was a lot of demand and now we see
Speaker 3: a lot of more IPO sideline waiting companies wanting to
Speaker 3: follow your tracks.
Speaker 5: Johnny A Sea, it's great to have you back on
Speaker 5: the show. CEO VI Toro, thank you.
Speaker 7: But I had a little problem with Tim Kky yesterday.
Speaker 7: I said to him, Tim, you and my friend I
Speaker 7: feated you very good. You're coming here with five hundred billionaires.
Speaker 7: But now I hear you're building all over India. I
Speaker 7: don't want your building in India. You can build an
Speaker 7: India if you want to take care of India. We
Speaker 7: want you to build here. And they're going to be
Speaker 7: upling their production in the United States Apple. So Apple's
Speaker 7: already and for five hundred billion, but they're going to
Speaker 7: be upring their production.
Speaker 3: Welcome back to New meag Technology and Caroline Hyde in
Speaker 3: New York and.
Speaker 6: I met Lovelow in San Francisco.
Speaker 5: Carroc I mean, we.
Speaker 3: Think about the ramifications of President Trump following his call
Speaker 3: on Apple CEO Tim Cook there to stop building so
Speaker 3: much in India, satisfy the Indian demand in India. You
Speaker 3: want to sartentisfy US demand closer to home. It's extraordinary,
Speaker 3: really that shares managed to bounce off of their lows.
Speaker 3: We're back flat on the day. More about the macro
Speaker 3: picture here in the US, maybe some resiliency when it
Speaker 3: comes to the inflationary data that we're seeing and retail lackluster,
Speaker 3: but not a disaster.
Speaker 5: And we've got to dig in more.
Speaker 3: To what's happening in terms of Apple and its call
Speaker 3: upon its own supply chain.
Speaker 4: Right now, Okay, let's get out to where the action
Speaker 4: is happening. Bloomberg's Emory Horden joined us now for the
Speaker 4: latest from Donald Trump's visit to the Middle East.
Speaker 6: In amh He's used.
Speaker 4: The public forum, so to speak, in the last forty
Speaker 4: eight hours to specifically name check technology CEOs, some positively,
Speaker 4: for example Jensen, and some more severe words for apples,
Speaker 4: Tim Kirk.
Speaker 6: What have we learned?
Speaker 13: Right?
Speaker 14: This is the second time on the President's Middle East
Speaker 14: tour that he actually called out Tim Cook. The first
Speaker 14: time was on Tuesday in Riot. He looked out into
Speaker 14: the room and he said, my friend, Jensen, you're here,
Speaker 14: he said, but notably missing is Tim Cook.
Speaker 2: But you're here.
Speaker 6: And then before he touched.
Speaker 14: Down in Abu Dhabi, he was talking about Tim Cook
Speaker 14: once again. In Doha, he was talking about the fact
Speaker 14: that India might be prepared to what the President said,
Speaker 14: literally lower their tirefrates to zero. And then he said,
Speaker 14: but I'm having a problem with Tim Cook, and I
Speaker 14: spoke to him about this yesterday. Why are you moving
Speaker 14: all your manufacturing to India. We let it go that
Speaker 14: you built all these plants in China. We want you
Speaker 14: to come to the United States. What's so interesting, of
Speaker 14: course about this. The President has been flanked by corporate America,
Speaker 14: especially tech executives, throughout this entire trip, and notably missing
Speaker 14: was the Apple CEO, and the President found time to
Speaker 14: call him back. What he I guess very frustrating and
Speaker 14: disturbing to him. And the President said, though that he's
Speaker 14: going to be moving that manufacturing to the United States.
Speaker 14: That has not been what Apple's been talking about. They're
Speaker 14: talking about de risking from China, willing to go into
Speaker 14: India potentially maybe more conversations about investments in the United
Speaker 14: States though.
Speaker 3: And of course investments still coming with the Middle East,
Speaker 3: and it's interesting that a lot of that is focused
Speaker 3: around access to AI sophisticated chips going to where you
Speaker 3: currently are, whether it's Abu Dabi also over in Saudi Arabia.
Speaker 3: But this is ringing alarm bells within the president's own
Speaker 3: administration memory.
Speaker 14: Yeah, that's right, and that becomes the national security concerns
Speaker 14: around all of this, getting what many would consider these
Speaker 14: Gulf countries as geopolitical swing states. This administration, especially with
Speaker 14: the China Hawks and this administration and even China Hawks
Speaker 14: Democrats in Washington want to make sure that the technologies
Speaker 14: does not leak to China. We saw a huge win
Speaker 14: for the likes of Nvidia and AMD in Saudi Arabia.
Speaker 14: We are on the heels waiting for a potential announcement
Speaker 14: here in Abu Dhabi of some sort of tech cooperation
Speaker 14: when it comes to AI. This story started in March.
Speaker 14: I reported about Chicktan Noun coming to the United States
Speaker 14: in the Oval Office, and the UAE announced that they
Speaker 14: were willing to invest one point four trillion dollars when
Speaker 14: it comes to AI and building data centers. But in
Speaker 14: order for them to do that, they need to get
Speaker 14: their hands on the chips, and we have reporting and
Speaker 14: potentially we will see these come across the finish line
Speaker 14: where the president is in the Emirates that they would
Speaker 14: likely allow one million high advance chips from Nvidia coming
Speaker 14: into the country. Kei, though, Caroline, to your point, for
Speaker 14: this to happen, they need to make sure that that
Speaker 14: technology does not leak into the hands of Beijing.
Speaker 6: Plums Am Marie Horden, thank you very much.
Speaker 4: The European Union today accused Takeok of breaking digital rules
Speaker 4: by not being transparent enough about advertisements Chinese owned social
Speaker 4: media platform says it's reviewing the decision. It's the latest
Speaker 4: regulatory move by the Bloc against so called big tech.
Speaker 6: I want to get to more.
Speaker 4: On how the European Union is approaching tech regulation and
Speaker 4: development like AI and bring in Hennah Vickenan.
Speaker 6: She's the European Commission's.
Speaker 4: Executive Vice President for Tech, Sovereignty, Security and Democracy. Executive
Speaker 4: vice President. Welcome to San Francisco, into the program. Actually
Speaker 4: you heard Anne, Marie there discuss a number of issues
Speaker 4: on the global stage.
Speaker 6: On your agenda and your calendar this week.
Speaker 4: I believe you've met already with Tim Cook and Sunda Pichai.
Speaker 4: You will meet with leaders like anthropics, Dario Amma Day.
Speaker 4: What were those conversations about and what was the focus.
Speaker 15: For your visit specially of course I want to meet
Speaker 15: American tech companies because for them, European Union is the
Speaker 15: biggest external markets and many of them they are having
Speaker 15: more users in the European Union than in USA. So
Speaker 15: of course it's very important that we have good dialogue
Speaker 15: with the tech companies and specially in the European Union.
Speaker 15: We want to boost investments and innovations when it comes
Speaker 15: to technologies, and we want to make sure that, for example,
Speaker 15: in AI we are building our own capacities. Also on AI,
Speaker 15: so especially we are speaking about our innovation at gender
Speaker 15: where we are willing to boost investments, innovations, create one
Speaker 15: single market, simplify the processes. So we want to make
Speaker 15: Europe faster and easier for businesses.
Speaker 4: The top story in the world today is the idea
Speaker 4: that the President of the United States has made an
Speaker 4: appeal to Tim Kirk to move production of the iPhone
Speaker 4: many millions of iPhones in Europe from India to the
Speaker 4: United States. Does the European Union have an offer to
Speaker 4: American technology companies to think about moving some of their
Speaker 4: industrial base to the block.
Speaker 15: We have, of course our own strengths when it comes
Speaker 15: to European Unions, so we are stable place for investments
Speaker 15: of course, and I think we have also very like
Speaker 15: predictable regulatory framework also and of course very talented work force.
Speaker 15: So I think these are our greatest strengths in the
Speaker 15: European Union and we really want to encourage also more
Speaker 15: investments and innovations in the European Union when it comes
Speaker 15: to technologies.
Speaker 3: Executive Vice President, it's interesting that you say a predictable
Speaker 3: regulatory environment, because many executives from big tech companies find
Speaker 3: it a frustrating regulatory environment. They think that it's too tough.
Speaker 3: What would your response be when you're going to meet
Speaker 3: Mark Zuckerberg in particular, who has lobbied the President of
Speaker 3: the United States. We understand because of some of what
Speaker 3: he sees draconian regulation coming.
Speaker 5: From the EU.
Speaker 15: What we want to make sure in the European Union
Speaker 15: is that we want to have a fair and safe
Speaker 15: and democratic environment. But also when it comes to digital world,
Speaker 15: so we.
Speaker 5: Have very clear roles.
Speaker 15: So we don't think that it's good to have, for example,
Speaker 15: mono police, because those gatekeepers they are often plugging them
Speaker 15: new innovations to enter through the market. So we want
Speaker 15: to make sure that we have fild competition, we have
Speaker 15: level playing feed for everybody. And also when it comes
Speaker 15: to big online platforms, they also have to take the
Speaker 15: responsibility there to make sure that they have not for example,
Speaker 15: spreading illegal content or selling illegal products. And they have
Speaker 15: to make care take care of course, for example, of
Speaker 15: safety when it comes to protection of miners, for example.
Speaker 15: So we have some very important priorities now we are
Speaker 15: also discussing with our online platforms.
Speaker 5: Especially the priorities.
Speaker 15: Are very much connected to our democratic processes and protection
Speaker 15: of miners for example, and transparency is something that we
Speaker 15: are also obliging from the very large online platforms because
Speaker 15: they have a great economic power nowadays in the world
Speaker 15: and also create power in our society. So that's why
Speaker 15: it's important that they are also respecting our rules and values.
Speaker 5: And your fines.
Speaker 3: And you did just levy what was it, five hundred
Speaker 3: million eurofine to Apple recently two hundred million euro two
Speaker 3: Meta because you feel that they didn't align themselves with
Speaker 3: the Digital Markets Act in particular. But some would say
Speaker 3: those fines were smaller than expected. Because we're worried about
Speaker 3: the repercussions within the tariff negotiation. How do you respond
Speaker 3: to that as ecutive vice president, Perhaps you're going softer
Speaker 3: because suddenly Trump is going harder.
Speaker 15: It's not something that we are seeking that we are
Speaker 15: posing fines for the companies. Of course, the main idea
Speaker 15: is all the time to make sure that everybody is
Speaker 15: complying with our roles. And the main tool how we
Speaker 15: are working with the digital companies is to have all
Speaker 15: the time dialogue with them and look that what we
Speaker 15: are expecting from them and how they could comply with
Speaker 15: our roles, and of course all of them always defending
Speaker 15: their business interests, but I think we have also good
Speaker 15: dialogue with them and constructive discussions.
Speaker 6: Executive Vice President.
Speaker 4: Last month, Bloomberg reported that President Trump was pressuring Europe
Speaker 4: to get rid of the AI Code of Practice, which
Speaker 4: is the framework attached to the EUSE Artificial Intelligence Act.
Speaker 4: What conversations have you had with this administration about that issue?
Speaker 4: The administration feels it is too burdensome on US technology
Speaker 4: companies operating in the block.
Speaker 15: It shouldn't be, because we see also that it's important
Speaker 15: that now when we are implementing our AI Act, that
Speaker 15: we are doing it in very innovative and friendly manner,
Speaker 15: and Code of Practice is really something that is supposed
Speaker 15: to help also businesses and industries and sms to comply
Speaker 15: with our al So we are still finalizing code of practice,
Speaker 15: but there has been a month of discussion with the
Speaker 15: different stakeholders and public hearings about it and we are
Speaker 15: still working on it. But how we want to implement
Speaker 15: our AI Act is very much that we want to
Speaker 15: support our industries and SMEs to really develop AI in
Speaker 15: ther Union. But in the same time, we see that
Speaker 15: it's important to be aware of the risks.
Speaker 4: You brought news with you, and that is the TikTok news. Today,
Speaker 4: the EU says that the TikTok ad system breaks consumer
Speaker 4: protection rules.
Speaker 6: Why what is your argument?
Speaker 15: They haven't been transparent in their actions, So it's something
Speaker 15: what is core in our Digital Service Act legislation that
Speaker 15: online platforms they have to be transparent with their actions.
Speaker 15: And that's why we saw that TikTok is not complying
Speaker 15: with our rules. So we published preliminary foundings today and
Speaker 15: now they have time also the review and respond and comply.
Speaker 15: We have several investigations going on in a pipeline now.
Speaker 3: Hannah Beckon, it has been wonderful having some time with you.
Speaker 5: We appreciate it.
Speaker 3: As you said, across all of your meetings and speeches
Speaker 3: European Commissioner for Tech, Sovereignty, Security in Democracy, on all
Speaker 3: things EU regulation.
Speaker 5: Meanwhile, we just bring you some breaking news.
Speaker 3: Toma Bravo is said to be have sold already it's
Speaker 3: remaining stake ink.
Speaker 5: For three point four billion dollars.
Speaker 3: Now, this, of course is the company the NASDAK that
Speaker 3: operates the exchanges and overall the private equity firm working
Speaker 3: with JP Morgan on The sale is conducted in an
Speaker 3: unregistered block of trades on the May seventh and May thirteenth,
Speaker 3: so selling the rest of their remaining Nasdaq holding shares
Speaker 3: flat on the day.
Speaker 4: For that company, Ali Baba earnings failed to impress investors
Speaker 4: as it faces slow in growth in its e commerce
Speaker 4: arm and missed earnings projections for its cloud business. Let's
Speaker 4: get out to Bloomberg's Henry Wren. Those are the two
Speaker 4: key categories. But what do we learn about the underlying reasons?
Speaker 6: Henry?
Speaker 16: Yeah, sure, some worrying signs for Alibaba this quarter. And
Speaker 16: let's start from the core e commerce business. The customer
Speaker 16: management revenue was pretty strong, up by about twelve percent
Speaker 16: from a earlier. However, there has been some more signs
Speaker 16: of competition going on. The company said that it's going
Speaker 16: to invest more heavily in a quick commerce business, which
Speaker 16: is an area that already been under investment under assault
Speaker 16: by its peers such as JD dot Com as well
Speaker 16: as PDD. The company said that its advertising tool as
Speaker 16: well as higher take rates from merchants are taking effect. However,
Speaker 16: it's unclear how much of the GMV has been growing
Speaker 16: for Ali Baba, so that has always been a concern
Speaker 16: for Ali Baba because it has been seeding market share
Speaker 16: to JD dot Com as well as PDD. On the
Speaker 16: other hand, for Cloud, it's growing about eighteen percent in
Speaker 16: terms of revenue. However, on earnings from because it's still
Speaker 16: investing heavily on AI chips, so earnings was a miss,
Speaker 16: and on the sales growth it's also missing more bullish
Speaker 16: investor estimates about twenty percent, so that has been a
Speaker 16: disappointment as well.
Speaker 3: Into these earnings, and Henry just go to the AI
Speaker 3: side of the equation as well, because they've been trying
Speaker 3: to reorientate.
Speaker 5: The logistics side was a weak point.
Speaker 3: But Generator AI and the infrastructure and investment, they're not
Speaker 3: quite living up.
Speaker 2: To the hype. Yeah.
Speaker 16: Indeed, so remember last quarter that Ali Baba told us
Speaker 16: that it's going to be an so called AI first company,
Speaker 16: is going to be pivoting a strategy to or in AGI.
Speaker 16: However we did this, didn't hear so much about AGI
Speaker 16: from the management in this quarter, and the company, to
Speaker 16: its credit, it's still seeing strong demand for AI influencing. However,
Speaker 16: it's probably takes time to invest because it's still kind
Speaker 16: of it told us that it's still in the investment
Speaker 16: phase of this business. And in the meantime, its.
Speaker 6: Models, its Q and models is generating some revenue.
Speaker 16: However, it just takes some time to gain traction.
Speaker 3: Bloom merg Henry Wren on all things Ali Baba and
Speaker 3: in commerce, we appreciate it. Let's stick with China because
Speaker 3: the ATL is set to raise at least four billion
Speaker 3: dollars in its Hong Kong share listing, pricing at the
Speaker 3: top of the end of the range and what is
Speaker 3: indicated based on some really strong demand so all according
Speaker 3: to sources. Let's go out to creator Dell who who
Speaker 3: tell us just how the e battery maker that is
Speaker 3: kind of in the eye of the geopolitical storm between
Speaker 3: China and the US is managing to drum up such
Speaker 3: support for this secondary listing.
Speaker 17: Yeah, and this listing was very much caught up in
Speaker 17: all of that sort of geopolitical tension where you had,
Speaker 17: you know, US banks that maybe we're going to have
Speaker 17: a role have to bow out. You know, CTL going
Speaker 17: back a few years has very much been a political
Speaker 17: football where you know, I'm reminded of the governor of Virginia,
Speaker 17: Glenn Youngkin, you know, was in the running for a
Speaker 17: plant where Ford was going to license c ATL technology,
Speaker 17: and he pulled his state out of the running and said,
Speaker 17: you know, this is a you know, a trojan horse.
Speaker 17: You know, these are just batteries, to be clear. And
Speaker 17: yet because of the dominance of China in this space,
Speaker 17: there's a lot of concern elsewhere in the world about
Speaker 17: how the how the West can possibly sort of catch
Speaker 17: up or compete with you know, the scale that this
Speaker 17: company has now reached.
Speaker 4: I remember that story and that interview with young Can
Speaker 4: very well. The frank reality is is that c at
Speaker 4: L is the world's biggest It is core to the
Speaker 4: EV battery cell supply chain. Where do those batteries get
Speaker 4: made and where do they go? And I'm of course,
Speaker 4: kind of hinting at Tesla's relationship with c at L.
Speaker 17: Yeah, I mean they predominantly make their batteries in China
Speaker 17: for China, and so if you want to buy a
Speaker 17: Tesla and you happen to be in China, you may
Speaker 17: indeed have a car with c at L batteries.
Speaker 2: And in fact, I mean, you know, virtually all.
Speaker 17: Manufacturers, you know, most of the major manufacturers are at
Speaker 17: least using Catel batteries in many of their models, right,
Speaker 17: And so you know, this is a company that is
Speaker 17: going overseas a little bit.
Speaker 2: It is, you know, opening in Germany.
Speaker 17: It's it's not entirely relyant on China, but it is
Speaker 17: very much a dominant aspect of their business.
Speaker 2: I think that's part of why you have so much.
Speaker 17: Concern on the part of government, since it's not so
Speaker 17: much you know, completely being you know, unwilling for this
Speaker 17: company to supply it wants, you know, I think, especially
Speaker 17: over here in Europe, there's a desire for Okay, we're
Speaker 17: open to you supplying to our manufacturers, but you need
Speaker 17: to build here.
Speaker 3: The most credudell As a theme for the day, it
Speaker 3: seems we appreciate you ed what's next.
Speaker 6: Okay, it's between tech and first Up.
Speaker 4: Pony Ai is confidentially filed for Hong Kong listing, with
Speaker 4: an offering set to take place this year. That's according
Speaker 4: to sources. The move comes as the autonomous driving company
Speaker 4: announced to partnership with Uber last week. Pony Ai declined
Speaker 4: to comment about the potential listing, and the offering size
Speaker 4: remains unknown. Plus sales of China Jaumi Su seven sedan
Speaker 4: plunged to around thirty six thousand units in April, continuing
Speaker 4: a lower trend from March after the company faced a
Speaker 4: fatal highway accident involving one of its vehicles. The company,
Speaker 4: you're also facing back clash from consumers over alleged false
Speaker 4: advertising at the vehicle's hood design and bay Do is
Speaker 4: fanning to test and eventually launch its autonomous ride haating
Speaker 4: service called Apollo Go in countries like Turkey.
Speaker 6: And across Europe. That's according to sources.
Speaker 4: The companies in talks with Swiss Posts to roll out
Speaker 4: a robot taxi service in Switzerland.
Speaker 6: We're testing to start by the end of the year.
Speaker 3: Bloomberg Technologies ones to Watch list it's out today this
Speaker 3: year highlights ten people shaping the artificial intelligence sector, and
Speaker 3: Joshua Brustin joins us to talk us through what is
Speaker 3: a myriad of investors, entrepreneurs, regulators, thought leaders and I'm
Speaker 3: really interested in Well, let's start with three. We're going
Speaker 3: to single out Luke Farada. Now he's a software engineer.
Speaker 3: We know him for his DOGE work, but we should
Speaker 3: know him for what he's doing with an ancient scroll Previously.
Speaker 13: Yeah, we actually wrote about Farada last year when he
Speaker 13: won a contest to use artificial intelligence to read the
Speaker 13: words on a series of ancient scrolls that have been
Speaker 13: burnt during the explosion of POMPEII, and this brought him
Speaker 13: to prominence and Ferreder, also a former SpaceX intern, then
Speaker 13: got a new position working with DOJE. We don't know
Speaker 13: a lot about what he's doing now, but we do
Speaker 13: know that a lot of people are trying to watch it.
Speaker 6: At least.
Speaker 4: Sarah Gua has been coming on this program with respect
Speaker 4: for almost two years, so I think I identified her
Speaker 4: as one to watch well before this list.
Speaker 6: But Joshua, she's connected.
Speaker 4: She's influential in Silicon Valley as an investor, but particularly
Speaker 4: in the realm of AI.
Speaker 13: Absolutely, I think She was one of the most nominated
Speaker 13: people when we went out looking for calls here. Had
Speaker 13: a history investing in other sectors, notably Crypto. Recently has
Speaker 13: been looking into the AI sector. She's made investments into
Speaker 13: companies that if you follow away at closely, you may
Speaker 13: have heard of, not the Open Aiyes and Anthropics, but Mistroll,
Speaker 13: the European AI company, and Harvey, a company that's doing
Speaker 13: AI for legal work.
Speaker 3: I think it's really notable that you've got fifty to
Speaker 3: fifty women and men across this particular list, and one
Speaker 3: of the most leading voices when it comes to the new.
Speaker 5: Era of social is ja Over at Blue Sky.
Speaker 3: And the way in which has perhaps taken on Mark
Speaker 3: Zuckerberg at.
Speaker 5: His own game.
Speaker 2: Yeah.
Speaker 6: Absolutely.
Speaker 13: Jay Graber the CEO of Blue Sky, which actually is
Speaker 13: a social network that started with in Twitter and has
Speaker 13: spun out. The idea here is to have a social
Speaker 13: network that has you have more control over what you're seeing,
Speaker 13: what's in your feeds. It's decentralized, so you can't have
Speaker 13: the control that someone like a Mark Zuckerberg has And
Speaker 13: Graber really was notably wearing a shirt that had some
Speaker 13: Latin writing in it, sort of mocking Mark Zuckerberg for
Speaker 13: taking to wearing a shirt that compares himself to Julius Caesar.
Speaker 4: Bloombergs Joshua Breustein, thank you very much, and that that
Speaker 4: does it for this edition of Bloomberg Technology.
Speaker 5: Do not forget to check out our podcast.
Speaker 3: Of course, you can find on the terminal Apple, Spotify,
Speaker 3: iHeart this is Bloomberg