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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. Bloomberg Tech is alive

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Speaker 1: from coast to coast, with Caroline Hide in New York

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Speaker 1: and Eva Low into San Francisco.

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Speaker 2: This is Bloomberg Tech coming up. Amazon cuts sixteen thousand

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Speaker 2: corporate jobs to remove letyers of bureaucracy and quote increase ownership.

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Speaker 3: That's ASML also announcing job cuts to boost efficiency and posting.

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Speaker 4: Strong fourth quarter orders, and.

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Speaker 2: Sources tell Bloomberg that SoftBank is in talks to invest

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Speaker 2: as much as thirty billion dollars more into Open AI.

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Speaker 3: Let's check in on these markets though, because there's been

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Speaker 3: some interesting whipsawing airsm hell among them.

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Speaker 4: But we go more macro right now.

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Speaker 3: One point, we saw the S and P five hundred

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Speaker 3: above that seven thousand dollars seven thousand level. We have

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Speaker 3: never seen that before, and that is as we see

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Speaker 3: the momentum in AI continuing.

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Speaker 4: But we have a crucial FED meeting. What is going

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Speaker 4: to be put to J.

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Speaker 3: Powell later today that independence of the Federal Reserve. We're

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Speaker 3: not thinking that there will be any move in terms

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Speaker 3: of race, but still there's nervousness, nervousness around Iran as well.

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Speaker 3: And there's a lot to be focusing in on. But

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Speaker 3: for now, now as that one hundred holds on to

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Speaker 3: a gains of four tens percent, what are you looking.

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Speaker 5: At the breaking new story of the morning.

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Speaker 2: Amazon is cutting sixteen thousand more corporate roles, eliminate middle management, streamline.

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Speaker 2: It confirms a lot of what Bloomberg had already reported.

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Speaker 2: The slot kind of bouncing around in the session now

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Speaker 2: softer by seven tenths of one percent. We're going to

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Speaker 2: get to that later in the program and go deep

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Speaker 2: on what's happening in Amazon and tech more broadly. Then

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Speaker 2: there's ASML at one point in the session up more

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Speaker 2: than seven percent and pushing to a fresh record high,

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Speaker 2: great blockbuster bookings, bookending the thirteenth consecutive year of growth,

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Speaker 2: and also doing its own job cuts. I guess, you know,

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Speaker 2: fix the roof while the sun is shining. Kind of

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Speaker 2: an allergy carrow. But now the stock is down softer

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Speaker 2: two and a half percent, something might have been happening

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Speaker 2: on the core.

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Speaker 4: Yeah, we've got to.

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Speaker 3: Dig into it because, as you mentioned, seventeen hundred jobs

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Speaker 3: to go in the Dutch maker.

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Speaker 4: The semiconductor equipment is.

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Speaker 3: World used, says it plans to cut seventeen hundred roles,

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Speaker 3: around four percent of the workforce, as an effort to

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Speaker 3: streamline the organization. The CEO has said. This is as

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Speaker 3: the company reported earnings that you mentioned, showing record fourth

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Speaker 3: quarter bookings field of course by AI demand. The SML

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Speaker 3: CEO Christophe Fuget, did speak with Bloomberg on the phone earlier.

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Speaker 4: Take to listen to what he had to say.

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Speaker 6: The last three months have brought a lot of clarity,

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Speaker 6: and I think what you see basically is that the

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Speaker 6: semi industry, our customers start to believe that this AI

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Speaker 6: demand is sustainable, and therefore they have moved into building

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Speaker 6: capacity and they are moving very aggressively. And I think

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Speaker 6: this has been very nicely translated indeed into a record

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Speaker 6: booking number. So that's of course very good news for

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Speaker 6: the mid term.

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Speaker 4: Why are the shares down, then, let's talk about.

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Speaker 3: The results when PFO is higher, global tech, infrastructure and

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Speaker 3: new street research. Why did we sell the rally the

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Speaker 3: record high and the shares earlier today?

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Speaker 7: Yes, that's a great question. So I think.

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Speaker 8: A SML basically confirmed what everybody suspected that twenty twenty

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Speaker 8: six is going to be a great year. Now you

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Speaker 8: have to take a step back and think what does that.

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Speaker 7: Mean agrate great year?

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Speaker 8: The guided revenue grows between four and nineteen percent, which

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Speaker 8: in absolute term is very strong growth. As you mentioned,

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Speaker 8: like the bookings were never seen. We've never seen that

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Speaker 8: level of orders at the SML, like exceeding thirteen billion

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Speaker 8: in a single in a single quarter. Now, when you

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Speaker 8: take a step back, think about what is the downstream

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Speaker 8: of SML.

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Speaker 7: Who are the clients. It's a Micron, it's a high.

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Speaker 8: Nix, it's a Samsuing, it's a TSMC, and these player

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Speaker 8: are actually growing much much faster than that. They're growing,

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Speaker 8: Like if you take for instance, c SMC is probably

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Speaker 8: going to grow like between thirteen and thirty five percent

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Speaker 8: this year. So we already see that semiicap equipment starts

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Speaker 8: lagging a bit their clients in terms of growth, and

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Speaker 8: that's a very natural thing because they sell equipment to

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Speaker 8: add capacity. And when you look at the trajectory of

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Speaker 8: growth of air, we are actually just passing the inflection points.

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Speaker 8: Going forward, gross is going to continue to be very strong,

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Speaker 8: but it is going too slow and so it's going

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Speaker 8: to translate into slower growth at semicap equipment manufacturers. And

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Speaker 8: I really think this is the way the street is

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Speaker 8: digesting the news today and overnight. Initially the stock was

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Speaker 8: up and now the street is raising. Okay, but if

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Speaker 8: twenty twenty six is a peak spending air, maybe it's

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Speaker 8: time to actually take profits on SML as a stock.

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Speaker 3: So you think this is peak, I mean, that's not

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Speaker 3: what one would hear from Johnson one who thinks we

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Speaker 3: still got trillions to go. Still in this mode of

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Speaker 3: trying to question whether we're in an AI bubble or not,

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Speaker 3: do you think that we've got any curacy on that

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Speaker 3: from ASML after we of course got TSMC of skah

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Speaker 3: next showed such strength and memory.

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Speaker 8: Yeah, so we're definitely not at peak on AI. And

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Speaker 8: you look at the TSMC guide to twenty twenty nine

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Speaker 8: growth between fifty five and sixty percent, so we are

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Speaker 8: still in a very.

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Speaker 7: High growth environment in AI. The peak I refer to

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Speaker 7: Caroline is.

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Speaker 8: A peak in actually capacity increase, because if in twenty

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Speaker 8: twenty seven you still grow very fast but a bit

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Speaker 8: slower than twenty twenty six, you will not need more

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Speaker 8: equipment than you needed in twenty twenty six. So this

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Speaker 8: is this idea that Semica players are driven by incremental capacity,

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Speaker 8: not by growth directly. It's the first order of derivative

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Speaker 8: of the growth of their clients. And that's the reason

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Speaker 8: why the market is right to be a bit nervous

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Speaker 8: specifically on submitting now when it comes to their clients.

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Speaker 8: Like the groser for twenty six is amazing. It's already

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Speaker 8: very strong for twenty twenty seven, and it looks really

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Speaker 8: good for twenty twenty eighteen, twenty twenty nine. So we

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Speaker 8: are still in very, very very strong growth environments in AI.

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Speaker 2: Yeah, if the stocks down and twenty twenty six is

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Speaker 2: the peak, the market doesn't believe mister Fuque, he thinks

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Speaker 2: it's about sustainability.

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Speaker 5: Listen to this real quick.

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Speaker 6: I think we have all been surprised by the magnitude

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Speaker 6: of AI, and we all saw it coming a bit.

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Speaker 6: But at the same time, you know, we see those

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Speaker 6: investment coming out and it's really big, and I think

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Speaker 6: that all of us are continuing to watch basically for

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Speaker 6: the sustainability of those investments. I think sustainability is a keyword.

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Speaker 6: I think the question is always.

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Speaker 7: Is this going to last?

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Speaker 6: I think that more and more of our customer are

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Speaker 6: responding positively to that question.

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Speaker 2: Is this going to last? And he's saying that the

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Speaker 2: signals from its customers are that it is going to last.

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Speaker 2: And you're saying the market isn't showing us.

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Speaker 8: That, whereas the market is showing is being careful about

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Speaker 8: it because this is going to last. For the CEO

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Speaker 8: of might mean we still have very good level of

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Speaker 8: spending in twenty twenty seven. But if twenty twenty seven

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Speaker 8: is as good as twenty twenty six, how is the

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Speaker 8: STUG going to work on that?

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Speaker 7: It's rightly not going to work.

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Speaker 2: Well, I have a question for you, what is the

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Speaker 2: leading indicator in the world of tech?

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Speaker 7: Right?

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Speaker 5: I can give you a chart right now.

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Speaker 2: It shows you expected capital expenditures for the hyperscalers and

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Speaker 2: other associated names like Meta and Oracle. Right, is that

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Speaker 2: the leading indicator? Or Bloomberg's Ian King is going to

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Speaker 2: come on next and tell us that Texas Instruments is

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Speaker 2: a leading indicator for the health of the economy, or

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Speaker 2: ASML and EUV demand is a leading indicator? Which data

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Speaker 2: set is most critically important to you right now?

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Speaker 8: Per So what's most critically important? Ed east to connect

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Speaker 8: these data sets rightfully?

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Speaker 7: I love that chart you just showed.

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Speaker 8: This is like capex and you see that we expect

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Speaker 8: capex to grow a lot this year growth next year,

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Speaker 8: and as we are not too sure, we don't model

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Speaker 8: much beyond that. This is a leading indicator. Now, what

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Speaker 8: is going to drive the business of ASML is how

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Speaker 8: much incremental capex you add every year. And what you

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Speaker 8: see very clearly is that this incremental capex is now

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Speaker 8: plateauing and coming down. And that's the reason why in

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Speaker 8: semi cap equipment you have to be careful and expect

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Speaker 8: like a significant slowdown.

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Speaker 7: In revenue growth for the rest of the industry.

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Speaker 8: Capex growth is a very very good indicator and it

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Speaker 8: takes us instrument is actually a very interesting indicator. That

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Speaker 8: is the most important indicator today outside of AI, because

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Speaker 8: it's quite important to understand what is the global economy

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Speaker 8: doing outside of AI. And we've been into like a

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Speaker 8: very very painful, lengthy downce I can in automotives, in

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Speaker 8: industry roles and what simply said, it's confirmed signals that

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Speaker 8: we've had already for a few weeks that we are

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Speaker 8: at the bottom and things are improving.

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Speaker 2: Just trying to answer the question is this going to last,

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Speaker 2: Pierre fair Agree from New Street Research, thank you very much.

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Speaker 2: I alluded to it just then. Shares of texts instruments

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Speaker 2: soaring after the company gave a surprisingly robust forecast for

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Speaker 2: the first quarter, signaling that customers have worked through inventory

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Speaker 2: and a returning for chips analog chips. Multiple analysts are

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Speaker 2: raising price targets, calling the outlook encouraging. Bloomberg's inking is

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Speaker 2: here analog chips simple translation of a touch of a

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Speaker 2: button into a signal. But we always write in our story,

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Speaker 2: in our summary of earnings, this is like the bell weather,

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Speaker 2: the crystal ball for the economy. What do we learn

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Speaker 2: through their earnings prece.

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Speaker 9: I mean, they've got tens of thousands of products, tens

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Speaker 9: of thousands of customers, so they are literally everywhere everything

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Speaker 9: that's got a on and off switch, that's where they are.

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Speaker 9: What they said was again, you were very careful, and

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Speaker 9: they're incrementally better. They had been talking about a recovery

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Speaker 9: being kind of off pace, not as kind of robust

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Speaker 9: as we would normally get. Now they're saying, actually orders

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Speaker 9: are improving and are continuing to improve. The signs are

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Speaker 9: now better.

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Speaker 3: How much are they able to harness any of the

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Speaker 3: AI vibes rather than auto's industrials, the bell Weather part.

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Speaker 9: Yeah, that's a very good question. The answer is they

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Speaker 9: confirmed the AI vibe is good for them. It's now

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Speaker 9: a significant business, but really it's not the main business.

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Speaker 9: The main business for them remains industrial and automotive, the

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Speaker 9: things that are a broader I mean, we know that

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Speaker 9: data centers is a big right and they confirm that. What

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Speaker 9: they told us was that industrial is getting better as well,

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Speaker 9: which is what we want to hear.

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Speaker 2: We've really focused right now on how global these companies are,

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Speaker 2: like currency impacts, like China, what's going on with China.

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Speaker 2: Is there anything kind of extra that Texas Instruments can

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Speaker 2: tell us about different geographies, other industries? Industrial good? Is

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Speaker 2: there anything that's pretty bad?

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Speaker 7: Yeah?

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Speaker 9: I mean they talked about consumer electronics not being fantastic,

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Speaker 9: and that's because consumer electronic actually recovered earlier than other

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Speaker 9: markets and now it's kind of slowing down a little bit.

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Speaker 9: Some of the consumer electronics devices, home theater maybe PCs

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Speaker 9: a little bit memory dependent. We talked about memory. The

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Speaker 9: press of memory is going up. That's snow secret and

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Speaker 9: that has a knock on impact.

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Speaker 3: Thinking as always breaking it down, and you mentioned memory,

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Speaker 3: We're going to go there check out Skhiinex shares. They

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Speaker 3: have really rocketed on the back of their earnings, and

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Speaker 3: there's this relentless appetite for AI memory, which s CA

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Speaker 3: Heinex serves. They're also in fact going to be establishing

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Speaker 3: an AI data center. Solutions from here in the usaid

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Speaker 3: how much has that to do with South Korea US

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Speaker 3: relationships going forward and the need to invest in the

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Speaker 3: United States. It's going to be backed by ten billion

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Speaker 3: dollars of capital to pursue partnerships and investments in the sector.

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Speaker 4: So keep an eye on that stock. And that was

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Speaker 4: its training in South Korea today.

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Speaker 2: Hey, coming out, trade tensions rise between the US and

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Speaker 2: South Korea.

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Speaker 5: More on the why. Next, this is Bloomberg Tech.

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Speaker 2: Taking a look at shares of Amazon softer seven tens

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Speaker 2: of one percent, the company announcing the card of sixteen

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Speaker 2: thousand corporate jobs worldwide, saying it's an effort to remove

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Speaker 2: layers of bureaucracy and to quote, increase ownership. It also

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Speaker 2: confirms quite a lot of what Bloomberg has been reporting

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Speaker 2: of late. Bloomberg Spencer Soper, who covers Amazon joins us. Now,

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Speaker 2: sixteen thousand corporate jobs is the latest.

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Speaker 5: Wave of more than one wave.

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Speaker 2: And the messaging and in line with your reporting, right

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Speaker 2: is that this is about efficiency and streamlining, not about AI.

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Speaker 2: What are the details of this particular trim that we're seeing.

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Speaker 10: Yeah, definitely delayering, the kind of targeting the middle. And

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Speaker 10: this is something that goes back to last year when

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Speaker 10: Jase was talking about you know, more more people who

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Speaker 10: are doing the direct work and fewer people managing the

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Speaker 10: work you know in the middle. So there's that in there.

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Speaker 10: It also hit a large you know, different parts of

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Speaker 10: the organization. So when they had initially laid off fourteen

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Speaker 10: thousand back in October, departments were given a choice, they

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Speaker 10: said they had to hit some numbers. They were given

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Speaker 10: a choice, do you want to cut people now or

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Speaker 10: wait until after after the holiday season. And so a

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Speaker 10: lot of departments, particularly the retail division, waited until after

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Speaker 10: Christmas to do their cuts. So now we're seeing a

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Speaker 10: total of thirty thousand, which is the biggest in Amazon's

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Speaker 10: history for the corporate side.

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Speaker 5: And that's you know, compared.

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Speaker 10: To I think twenty seven thousand, which was a few

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Speaker 10: years ago, Back in twenty twenty one and twenty two now.

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Speaker 3: Phil Spencer that they've been at length to say this

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Speaker 3: isn't some regular occurrence. I know, Beth Galetti, who's really

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Speaker 3: in charge of people experience technology, is this isn't going

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Speaker 3: to be some rolling set of cuts that we see

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Speaker 3: every few months. But thirty thousand last three months is

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Speaker 3: a huge amount.

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Speaker 10: Yeah, thirty thousand is a big amount. But also if

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Speaker 10: you read her statement very carefully, it's really corporate goblety

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Speaker 10: Google trying to strike that tone between you know, reassuring

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Speaker 10: employees but also not making any promises, you know what

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Speaker 10: I mean. So's she's saying some might ask if this

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Speaker 10: is going to be a rolling theme and you know,

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Speaker 10: but she's not really saying, hey, we're not going to

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Speaker 10: cut anymore over this period of time. So it's kind

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Speaker 10: of just not noncommittal Gobletygoog if you really read it carefully.

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Speaker 4: Yeah, saying is this the beginning of a new rhythm.

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Speaker 4: That's not our plan.

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Speaker 3: But just as we always have, every team will continue

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Speaker 3: to evaluate the ownership, speeding capacity to invent for customers.

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Speaker 3: Bloomberg Expense of Sofa thanks for breaking it down for us. Now,

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Speaker 3: the Trump administration is demanding the South Korea implement it's

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Speaker 3: a six month old trade deal with the US to

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Speaker 3: prevent Harrison rising to twenty five percent. Trade Tensions between

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Speaker 3: the two countries have been rising mean worse by the

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Speaker 3: US's frustration with Korean digital services regulations. New Vaccinia tech

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Speaker 3: editor Mike Shephard joined US Now to unpack what is

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Speaker 3: a tech centric story in many ways because it involves

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Speaker 3: key chip makers over in Korea, for example, Well, it

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Speaker 3: really does.

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Speaker 11: And we saw actually the flashes of this growing as

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Speaker 11: long as ten days ago Caroen, we saw Howard Lutnik

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Speaker 11: threatening those memory makers with tariffs of up to one

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Speaker 11: hundred percent if they didn't step up their investments here.

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Speaker 7: In the US.

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Speaker 11: And that is one of the issues that we have

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Speaker 11: seen surge more recently with the president's threat of increasing

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Speaker 11: tariffs to twenty five percent from the current agreed upon

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Speaker 11: fifteen percent level. And a lot of that has to

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Speaker 11: do with what is happening with those investments. Remember, under

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Speaker 11: the deal, South Korea had promised to invest as much

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Speaker 11: as three hundred and fifty billion dollars in the US

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Speaker 11: over the next several years, but that step has been

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Speaker 11: installed in the South Korean parliament. They are just beset

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Speaker 11: by a lot of issues, including currency woes and capital outflows,

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Speaker 11: and so lawmakers there have really not been able to

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Speaker 11: codify how this investment would go forward.

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Speaker 12: But we heard this morning from.

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Speaker 11: US Trade Representative Jamison Greer that time is up in

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Speaker 11: South Korea needs to start moving otherwise the US will

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Speaker 11: move to the next step, perhaps, and that is implementing

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Speaker 11: a potential tarer of increase.

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Speaker 5: Mike.

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Speaker 2: The other news story at the intersection of tech and

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Speaker 2: what's happening in Washington, DC is Intel pledging to match

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Speaker 2: Trump account contributions for its employees.

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Speaker 5: What do we need to know about that?

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Speaker 11: Well, it's an interesting step, and it's one that other companies,

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Speaker 11: including Blackrock, have already taken and that they are in Dell,

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Speaker 11: of course, Michael Dell, the founder of Dell Computing, is

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Speaker 11: one of the pioneers behind this Trump accounts project and

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Speaker 11: has made some big pledges that we've talked about.

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Speaker 7: On this program before.

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Speaker 11: But Intel is getting in line with that. And of

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Speaker 11: course the stakes for Intel are quite different. And when

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Speaker 11: I say stakes, it's quite literal. The US government owns

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Speaker 11: currently five point five percent of the company and is

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Speaker 11: on course to own as much as ten percent of

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Speaker 11: the chip maker. And it's also interesting ed that in

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Speaker 11: December the company hired Robin Colwell from the White House

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Speaker 11: to serve as its next government head of government affairs

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Speaker 11: here in Washington. So Intel is in a way really

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Speaker 11: aligning with this initiative, the Trump Accounts, which are designed

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Speaker 11: to encourage saving and investment by parents four young children

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Speaker 11: over the next several years, to try to get people

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Speaker 11: not only invested in the stock market, but saving over

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Speaker 11: the long haul. And in this way, Intel is trained

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Speaker 11: to get on the right side of the story with

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Speaker 11: the administration in another one of the president's priorities.

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Speaker 2: Blouemberg's Mike Shefard, thank you very much, Caro.

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Speaker 4: It's time now for talking tech ed first up.

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Speaker 3: Elil Musk has suggested the timing of SpaceX is possible.

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Speaker 3: Blockbuster IPO could come in mid June and is according

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Speaker 3: to a report in the Financial Times. The owner of

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Speaker 3: the rocket maker, of course, is wanted to be targeting

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Speaker 3: the IPO for when Jupiter and Venus will appear very

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Speaker 3: close together in the sky.

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Speaker 4: Mask's fifty fifth birthday is also in June.

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Speaker 3: Plus, Snap has created a subsidiary dedicated to augmented reality

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Speaker 3: glasses specs. Now the unit is intended to give the

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Speaker 3: smart Iwear team more independence.

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Speaker 4: Will allow it to raise some money.

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Speaker 3: A spokesperson confirmed Snap will launch the AAR glasses regardless

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Speaker 3: of external investment, and Apple CEO Tim Cook, who has

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Speaker 3: joined other tech leaders weighing in on the killing of

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Speaker 3: Alex Pretti by federal agents in Minnesota. In an internal memo,

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Speaker 3: Cook called for de escalation. He said he had spoken

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Speaker 3: to President Trump about the situation. Soft Bank as in

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Speaker 3: talks to invest as much as thirty billion dollars.

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Speaker 4: More into Open Ai. And now that's according to sources, the.

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Speaker 3: Japanese firm is already one of opening Ice big as

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Speaker 3: backers within eleven percent steak in the chatchipt maker and

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Speaker 3: with More's bloomgs AI and data centers are Lin Dwan.

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Speaker 3: And so thirty billion really makes massa all in. I mean,

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Speaker 3: we know he takes big bets.

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Speaker 13: Yeah, and I think we had one of the nalysts

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Speaker 13: out in Asia saying he is literally betting the house

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Speaker 13: on open in other AI.

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Speaker 4: Six.

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Speaker 13: Now that being said, it's probably worth pointing out that

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Speaker 13: it's as much as thirty billion dollars as opposed to

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Speaker 13: thirty billion dollars itself, So we'll see exactly where he

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Speaker 13: lands there. But I mean, let's face it, like Saffink

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Speaker 13: has already invested tens of billions of dollars in open Ai,

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Speaker 13: so it's another thirty billion dollars at this point, right.

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Speaker 2: Lynn, There are lots of people in my world asking

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Speaker 2: equally if open ai is good for it in all

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Speaker 2: their capital commitments for infrastructure and where the soft bank

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Speaker 2: has up to thirty billion dollars. But the main thrust

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Speaker 2: of it is that this is part of a that

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Speaker 2: we know is happening. Right open ai wants to raise money.

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Speaker 2: What do we know about its target raise overall and

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Speaker 2: the valuation it wants to hit irrespective of how much

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Speaker 2: soft Bank contributes to that.

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Speaker 13: That's exactly right, and we've been reporting on this funding

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Speaker 13: round that open ai has been orchestrating over the past

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Speaker 13: several months for a while now. Obviously stop Bank isn't

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Speaker 13: the only name that is intended to invest in this round.

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Speaker 13: We very recently broke the news that open ai has

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Speaker 13: been in conversations with very big name investors in the

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Speaker 13: Middle East, and so it's possible that we see some

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Speaker 13: sovereign wealth money wind up in this round. Now in

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Speaker 13: terms of like what their targeting valuation wise, very difficult

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Speaker 13: to say. It's even like difficult to say exactly how

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Speaker 13: much they may end.

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Speaker 4: Up raising in the end.

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Speaker 13: The ranges that you see out there from us, from

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Speaker 13: others in the media are kind of all over the place.

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Speaker 13: It's like anywhere from some hundred and fifty billion dollars

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Speaker 13: to eight hundred than fifty billion dollars depending on where

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Speaker 13: investors in Open AI decide to land in the end.

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Speaker 13: So it's very much an active round and we continue

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Speaker 13: to try to keep tabs of exactly where it lands.

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Speaker 3: What's interesting is how SoftBank has been very focused on

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Speaker 3: the AI play, but also selling down an invidio to

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Speaker 3: be able to loosen up some cash. They made a

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Speaker 3: purchase of Ampare, for example in the chips area. Are

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Speaker 3: they deemed winner in the AI space right now?

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Speaker 13: Well, I think it's probably two different questions that you're

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Speaker 13: looking to unpack there. One is what does stopping selling

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Speaker 13: down its sake and in VideA really mean? And I

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Speaker 13: think that for a moment, people were making the mistake

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Speaker 13: of interpreting that as ooh, stopping sees that it's getting

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Speaker 13: like way over its skis and it's not really you know,

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Speaker 13: all in on AI, when in fact, what it was

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Speaker 13: really doing is trying to raise enough money to make

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Speaker 13: even more bets on AI. Your other question though, was like,

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Speaker 13: is Stoppank a winner in AI? I mean, is anybody

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Speaker 13: a winner in AI? I think that the concerns of

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Speaker 13: an AI bubble are still relevant. We saw is Sameltho

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Speaker 13: report some strong bookings, So.

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Speaker 4: Welcome back to Bloomberg Tech.

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Speaker 3: Let's check in on these markets which I've been flip flopping,

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Speaker 3: and we build anticipation of the FED decision and indeed

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Speaker 3: many feeling we're not going to get a rate change.

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Speaker 4: But what will J Powell say at the press conference.

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Speaker 3: We also got building geopolitical anxiety where it's about Iram,

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Speaker 3: whether we've got still tensions with South Korea in terms

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Speaker 3: of trade. Nevertheless, one point, the S and P five

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Speaker 3: hundred go is above seven thousand, and then as that

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Speaker 3: one hundred holds onto its gains, earnings are coming thick

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Speaker 3: and fast. This is where we see the fundamental picture

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Speaker 3: of this tech rally that we're so used to seagate

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Speaker 3: best performer in terms of actual percentage move when you're

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Speaker 3: look at the nast that one hundred and twenty percent.

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Speaker 3: This is again winning formula on memory and it is

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Speaker 3: calling the numbers that came put out last night terrific.

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Speaker 3: Texas Instruments also came out with numbers. This is like

442
00:22:53,920 --> 00:22:55,719
Speaker 3: the bell weather when you're thinking about industrials and ththing

443
00:22:55,720 --> 00:22:57,880
Speaker 3: about autos and we've hit a bottom word coming back

444
00:22:57,880 --> 00:22:59,720
Speaker 3: out of it. Were up almost eight percent on that

445
00:22:59,800 --> 00:23:03,960
Speaker 3: now ASML actually turns red it had blowout orders. But

446
00:23:04,080 --> 00:23:06,840
Speaker 3: see many people questioning perhaps where they can keep on

447
00:23:07,040 --> 00:23:11,040
Speaker 3: building momentums selling chip equipment to those chip makers such

448
00:23:11,040 --> 00:23:13,720
Speaker 3: as TSMC Intel here in the United States, Intel, as

449
00:23:13,760 --> 00:23:16,840
Speaker 3: I say, up ten percent. Keep an eye on how

450
00:23:17,080 --> 00:23:19,600
Speaker 3: the moon music has changed around AI or whether there's

451
00:23:19,600 --> 00:23:21,400
Speaker 3: a bubble or not ed. It's all about these.

452
00:23:21,320 --> 00:23:22,000
Speaker 4: Earnings right now.

453
00:23:22,920 --> 00:23:25,600
Speaker 2: It is, and big tech earnings are well and truly

454
00:23:25,800 --> 00:23:29,120
Speaker 2: upon us, and that includes service now. Bloomberg Intelligence says

455
00:23:29,160 --> 00:23:33,080
Speaker 2: investors want to hear about the pending acquisition of cybersecurity

456
00:23:33,119 --> 00:23:36,199
Speaker 2: startup Arms, along with new AI sales and a lot more.

457
00:23:36,280 --> 00:23:39,480
Speaker 2: Bloomberg's Brady Ford, who covers the software space, is here

458
00:23:39,560 --> 00:23:43,400
Speaker 2: with us generally right now that the IT spending environment

459
00:23:43,600 --> 00:23:46,199
Speaker 2: isn't great. What is the kind of read through an

460
00:23:46,240 --> 00:23:50,120
Speaker 2: expectation from the street on how service Now will talk

461
00:23:50,200 --> 00:23:52,080
Speaker 2: about that, right and how it will show up in

462
00:23:52,080 --> 00:23:52,760
Speaker 2: their own numbers.

463
00:23:53,200 --> 00:23:56,200
Speaker 14: Application software has just had a really tough stretch the

464
00:23:56,320 --> 00:23:58,800
Speaker 14: last year, right. I Mean we've seen all of these

465
00:23:58,840 --> 00:24:01,920
Speaker 14: big vendors, whether it be Salesforce or Service Now, talk

466
00:24:02,000 --> 00:24:05,200
Speaker 14: up their new AI tools, but it just seems that

467
00:24:05,320 --> 00:24:07,800
Speaker 14: we can't quite see it in the numbers that there's

468
00:24:07,840 --> 00:24:10,639
Speaker 14: a real revenue uplift and with service Now, add on

469
00:24:10,760 --> 00:24:13,400
Speaker 14: top that they've made two big deals in the last years,

470
00:24:13,480 --> 00:24:16,840
Speaker 14: so I just see a lot more investor anxiety about

471
00:24:16,880 --> 00:24:18,920
Speaker 14: them than I had at any point in recent years.

472
00:24:19,600 --> 00:24:21,159
Speaker 3: I mean, you just have to look back to how

473
00:24:21,200 --> 00:24:24,679
Speaker 3: their shares have deeply underperformed last year, where they were

474
00:24:24,720 --> 00:24:28,600
Speaker 3: off by basically almost thirty percent. When you flip into

475
00:24:28,680 --> 00:24:32,240
Speaker 3: what we might hear from IBM, it has actually outperformed

476
00:24:32,320 --> 00:24:35,920
Speaker 3: software names, But their consultancy side of the business is

477
00:24:35,960 --> 00:24:38,280
Speaker 3: maybe the one that you get the AI part of

478
00:24:38,320 --> 00:24:41,120
Speaker 3: the equation coming in exactly.

479
00:24:41,320 --> 00:24:45,760
Speaker 14: IBM is facing this moment where the discretionary spending is

480
00:24:45,840 --> 00:24:49,960
Speaker 14: being taken out of those traditional consulting projects. But it

481
00:24:50,080 --> 00:24:52,119
Speaker 14: doesn't seem to matter too much for them because a

482
00:24:52,200 --> 00:24:54,920
Speaker 14: lot of their infrastructure software is doing quite well and

483
00:24:55,040 --> 00:24:57,640
Speaker 14: people are still buying a ton of mainframes. Who knew

484
00:24:58,440 --> 00:25:02,200
Speaker 14: so IBM has actually face study pretty you know, positive

485
00:25:02,400 --> 00:25:05,600
Speaker 14: environment for a name that in the past was associated

486
00:25:05,680 --> 00:25:09,399
Speaker 14: with kind of stargy, boring, slow growth company.

487
00:25:09,440 --> 00:25:09,600
Speaker 2: You know.

488
00:25:09,880 --> 00:25:12,239
Speaker 3: Don't even get them started on quantum, Brody, We've got

489
00:25:12,280 --> 00:25:13,800
Speaker 3: a lot to digest after the biles.

490
00:25:13,840 --> 00:25:16,520
Speaker 4: Thanks to you. We appreciate it, Brodie Forward. Now, another

491
00:25:16,560 --> 00:25:18,440
Speaker 4: stock we're watching is Microsoft.

492
00:25:18,680 --> 00:25:21,520
Speaker 3: Investors are paying close attention to its cloud computing service

493
00:25:21,600 --> 00:25:24,520
Speaker 3: as You and the impact of AI generalor AI how

494
00:25:24,680 --> 00:25:25,280
Speaker 3: thin can is.

495
00:25:25,280 --> 00:25:26,840
Speaker 4: A Wolf Research analyst.

496
00:25:26,720 --> 00:25:30,040
Speaker 3: Expects the platform's growth to exceed guidance at thirty nine percent, writing,

497
00:25:30,320 --> 00:25:33,760
Speaker 3: we believe that open ai training revenue will begin contributing

498
00:25:33,800 --> 00:25:36,200
Speaker 3: more materialy to as You're in the second fiscal quarter

499
00:25:36,320 --> 00:25:39,720
Speaker 3: and beyond, which could provide incremental upside to our preview.

500
00:25:40,080 --> 00:25:42,919
Speaker 4: Alex joins us. Now, the question is do.

501
00:25:43,040 --> 00:25:46,560
Speaker 3: They have the capacity to serve the relentless demand from

502
00:25:46,600 --> 00:25:48,119
Speaker 3: a player such as open ai ad it.

503
00:25:49,480 --> 00:25:52,440
Speaker 15: Yeah, I mean that's the I think the big question

504
00:25:52,720 --> 00:25:55,960
Speaker 15: and look We're excited. We think this is the bell

505
00:25:56,040 --> 00:25:59,080
Speaker 15: weather that's going to help usher AI into the enterprise era,

506
00:25:59,720 --> 00:26:02,880
Speaker 15: the mo from co pilot to coworker that never sleeps,

507
00:26:03,720 --> 00:26:07,200
Speaker 15: never eats, never complains, just works on complicated problems all

508
00:26:07,280 --> 00:26:09,480
Speaker 15: the time with the same tool chain that you're used

509
00:26:09,480 --> 00:26:11,920
Speaker 15: to as a human. We think Microsoft is very well

510
00:26:11,960 --> 00:26:15,359
Speaker 15: positioned as a platform to deliver on all parts of

511
00:26:15,480 --> 00:26:18,840
Speaker 15: that stack and journey, the most important metric being Azure.

512
00:26:19,240 --> 00:26:22,640
Speaker 15: The capacity constraint issues we think do start to get

513
00:26:22,720 --> 00:26:25,960
Speaker 15: resolved as they bring the Fairwater data centers online. We

514
00:26:26,119 --> 00:26:30,159
Speaker 15: see both the Wisconsin and Atlanta data center starting to

515
00:26:30,560 --> 00:26:34,200
Speaker 15: ramp and contribute. We think that unlocks about a gigawatt

516
00:26:34,200 --> 00:26:36,840
Speaker 15: of capacity over the course of the next year, which

517
00:26:37,080 --> 00:26:40,280
Speaker 15: we estimate about twenty billion dollars of incremental Azure unlock.

518
00:26:40,840 --> 00:26:44,600
Speaker 15: We think that they also are contracting and expanding their

519
00:26:44,640 --> 00:26:49,480
Speaker 15: capacity with third parties like the Neo Clouds, n Scale, Nebius,

520
00:26:50,119 --> 00:26:52,320
Speaker 15: and a few others that could be up to another

521
00:26:52,359 --> 00:26:56,040
Speaker 15: gigawatt of capacity or another potential twenty billion. So we

522
00:26:56,119 --> 00:26:58,560
Speaker 15: think that you start to see those resolutions come through

523
00:26:58,640 --> 00:27:01,000
Speaker 15: over the course of the next few quarters.

524
00:27:01,160 --> 00:27:03,080
Speaker 3: I want to go back to where you started co

525
00:27:03,359 --> 00:27:06,480
Speaker 3: pilot and then you went coworker. What's so interesting really

526
00:27:06,560 --> 00:27:08,440
Speaker 3: on the show the last few days and really thinking

527
00:27:08,480 --> 00:27:13,760
Speaker 3: about anthropics offering cowork how much is that potentially a

528
00:27:13,880 --> 00:27:15,480
Speaker 3: real competitor to Microsoft?

529
00:27:15,520 --> 00:27:17,399
Speaker 4: Could it up end it in the space?

530
00:27:20,280 --> 00:27:20,520
Speaker 16: To me?

531
00:27:21,400 --> 00:27:24,000
Speaker 15: And the way we think about it is that we're

532
00:27:24,160 --> 00:27:26,959
Speaker 15: in phase zero of adoption in the enterprise. A lot

533
00:27:27,040 --> 00:27:29,399
Speaker 15: of the tools, the way they're being used right now,

534
00:27:29,600 --> 00:27:33,240
Speaker 15: we're in the discovery phase of what's possible. We think

535
00:27:33,320 --> 00:27:37,359
Speaker 15: that anthropic open AI really all the model companies have

536
00:27:37,520 --> 00:27:41,960
Speaker 15: an opportunity to massively expand the value creation that they're

537
00:27:42,000 --> 00:27:46,000
Speaker 15: delivering in their offerings in the enterprise specifically, and so

538
00:27:46,320 --> 00:27:50,639
Speaker 15: this is a demonstration, we believe where different vendors at

539
00:27:50,680 --> 00:27:53,960
Speaker 15: different times will be able to exhibit share gains with

540
00:27:54,160 --> 00:27:59,560
Speaker 15: functionality that they launch in their ecosystems to enable value creation.

541
00:28:00,240 --> 00:28:03,040
Speaker 15: We view it less as a zero sum and more

542
00:28:03,119 --> 00:28:05,520
Speaker 15: of as an infinite game that we're just starting to play.

543
00:28:06,400 --> 00:28:08,760
Speaker 2: A I find this so interesting that we started this

544
00:28:08,840 --> 00:28:11,720
Speaker 2: conversation about top line growth and Azure right almost the

545
00:28:11,800 --> 00:28:14,440
Speaker 2: reverse of a conversation we might have had one or

546
00:28:14,480 --> 00:28:17,960
Speaker 2: two quarters ago, which would have started with kappas or expenditures.

547
00:28:18,840 --> 00:28:22,200
Speaker 5: How much do you need to just get a projection.

548
00:28:21,960 --> 00:28:25,440
Speaker 2: Of confidence from Microsoft on their capital expenditure figures to

549
00:28:25,600 --> 00:28:27,320
Speaker 2: keep this big story alive.

550
00:28:29,160 --> 00:28:32,560
Speaker 15: Yeah, So look, last quarter was the big shift quarter

551
00:28:32,680 --> 00:28:35,920
Speaker 15: in terms of CAPEX, going from you know something where

552
00:28:35,960 --> 00:28:37,480
Speaker 15: we thought it was going to be one hundred billion

553
00:28:37,520 --> 00:28:39,120
Speaker 15: to one hundred and fifty billion this year.

554
00:28:39,760 --> 00:28:43,160
Speaker 12: We think that the CAPEX shift has been made.

555
00:28:43,240 --> 00:28:46,880
Speaker 15: We think now it's a question of stability and you know,

556
00:28:47,120 --> 00:28:51,080
Speaker 15: to some extent, maybe aligning the increase from here with

557
00:28:51,560 --> 00:28:54,600
Speaker 15: some of your kind of core revenue growth assumptions.

558
00:28:54,640 --> 00:28:57,800
Speaker 12: But look, that could change too. Over the last month, we.

559
00:28:57,880 --> 00:29:01,320
Speaker 15: Think inference has quite frankly exploded with the amount of

560
00:29:01,360 --> 00:29:05,120
Speaker 15: tokens being generated for autonomous coding tasks that are now

561
00:29:05,240 --> 00:29:10,560
Speaker 15: running you know, at large when people sleep, as well

562
00:29:10,600 --> 00:29:14,080
Speaker 15: as some of the possible functionalities exhibited by things like

563
00:29:14,200 --> 00:29:18,160
Speaker 15: clog bot and these other kind of orchestration engines. So

564
00:29:18,880 --> 00:29:22,560
Speaker 15: it's anyone's guest. We don't think CAPEX is going down

565
00:29:22,640 --> 00:29:25,400
Speaker 15: anytime soon. We think kind of stable to up is

566
00:29:25,480 --> 00:29:26,520
Speaker 15: how we are thinking about it.

567
00:29:28,360 --> 00:29:32,080
Speaker 2: When it comes to genuinely autonomous agents. You know, Microsoft's

568
00:29:32,080 --> 00:29:34,080
Speaker 2: are very good. I always say this on the program.

569
00:29:34,200 --> 00:29:36,560
Speaker 2: That's what I grew up with, selling software that you

570
00:29:36,600 --> 00:29:40,960
Speaker 2: can otherwise get for free elsewhere. They're not the only game, right.

571
00:29:41,040 --> 00:29:43,560
Speaker 2: When it comes to the coworker, AWS has a very

572
00:29:43,640 --> 00:29:46,080
Speaker 2: similar story they like to tell. They like to talk

573
00:29:46,200 --> 00:29:50,720
Speaker 2: up their prowess in observability, right, really important critical factor

574
00:29:50,760 --> 00:29:53,040
Speaker 2: when an agent is an autonomous and they talk up

575
00:29:53,040 --> 00:29:56,320
Speaker 2: at AWS how well they're doing to help engineers get

576
00:29:56,360 --> 00:29:59,120
Speaker 2: through backlog. How are you going to discern addicts which

577
00:29:59,200 --> 00:30:02,320
Speaker 2: companies better at that you know, and therefore which will

578
00:30:02,360 --> 00:30:03,640
Speaker 2: be adopted in the enterprise.

579
00:30:04,880 --> 00:30:07,800
Speaker 12: Well, look, I think all three hyperscalers have a role

580
00:30:07,880 --> 00:30:08,240
Speaker 12: to play.

581
00:30:08,400 --> 00:30:13,080
Speaker 15: I think the one element about autonomous agents, particularly ones

582
00:30:13,120 --> 00:30:18,960
Speaker 15: that have to handle sensitive, oftentimes customer privileged information is security. Now,

583
00:30:19,040 --> 00:30:22,240
Speaker 15: we think one of the key differentiators for Microsoft is

584
00:30:22,720 --> 00:30:27,600
Speaker 15: their security portfolio, their security stack, their security graph as

585
00:30:27,680 --> 00:30:30,200
Speaker 15: well as you know, all of the investments that they've

586
00:30:30,320 --> 00:30:33,280
Speaker 15: made in other parts of the data platform has stayed

587
00:30:33,280 --> 00:30:35,600
Speaker 15: over time. So we think that is a critical piece

588
00:30:35,640 --> 00:30:39,080
Speaker 15: of the puzzle that will help them gain share of

589
00:30:39,240 --> 00:30:42,760
Speaker 15: this developing market that we're just kind of starting to discover.

590
00:30:42,840 --> 00:30:47,080
Speaker 2: The use cases around Alex Zuchin and four research greats.

591
00:30:47,120 --> 00:30:49,760
Speaker 2: Have you on the show in Advanced Microsoft now coming up?

592
00:30:49,800 --> 00:30:52,640
Speaker 2: While b CEO Raquel Eredison joins us to talk about

593
00:30:52,680 --> 00:30:57,720
Speaker 2: the self driving startups, latest funding and push into robotaxis.

594
00:30:58,160 --> 00:30:59,880
Speaker 5: A's next. This is Bloomberg Tech.

595
00:31:08,160 --> 00:31:11,360
Speaker 3: Self driving startup warbe I secured one billion dollars in

596
00:31:11,440 --> 00:31:13,600
Speaker 3: new funding and includes a seven hundred and fifty million

597
00:31:13,680 --> 00:31:15,920
Speaker 3: Series C that was led by Coast Adventures by G

598
00:31:16,040 --> 00:31:18,520
Speaker 3: two venture partners, plus two hundred and fifty million in

599
00:31:18,800 --> 00:31:21,880
Speaker 3: a milestone based investment from Uber to lunch.

600
00:31:22,040 --> 00:31:25,000
Speaker 4: Wabi enabled robotaxis.

601
00:31:24,520 --> 00:31:28,520
Speaker 3: Joining us now Raquel Rotisen, she's a CEO founder of Wabi.

602
00:31:29,000 --> 00:31:31,880
Speaker 3: How important is this focus on physical AI in the

603
00:31:31,960 --> 00:31:34,080
Speaker 3: trucking space now moving to the robo taxi?

604
00:31:34,160 --> 00:31:35,440
Speaker 4: How significant is that for you?

605
00:31:36,200 --> 00:31:38,440
Speaker 17: Yeah, so it's a really exciting moment. I will say,

606
00:31:38,560 --> 00:31:40,960
Speaker 17: where you know, the physically a revolution is here and

607
00:31:41,080 --> 00:31:43,560
Speaker 17: sold Iran is what is going to skill first, and

608
00:31:43,880 --> 00:31:46,040
Speaker 17: you know we have a very Advanne system in tracking

609
00:31:46,280 --> 00:31:49,440
Speaker 17: and now we are entering rowo taxi with a massive

610
00:31:49,480 --> 00:31:52,320
Speaker 17: furnitshire with with Uber and you know it's really the

611
00:31:52,400 --> 00:31:55,200
Speaker 17: next stage for that company is really exciting to be

612
00:31:55,400 --> 00:31:56,840
Speaker 17: you know, reading their way in physical AI.

613
00:31:57,240 --> 00:32:00,720
Speaker 3: What's interesting is we had gatekon yesterday also raising fun well,

614
00:32:00,800 --> 00:32:04,320
Speaker 3: they're securing new deals, they're already commercializing.

615
00:32:04,720 --> 00:32:07,120
Speaker 4: How is your go to market looking?

616
00:32:07,360 --> 00:32:09,760
Speaker 3: It's all about the platform that you offer when it

617
00:32:09,840 --> 00:32:11,800
Speaker 3: comes to trucking and now robotaxis.

618
00:32:11,840 --> 00:32:13,320
Speaker 4: What is it that makes you so distinct?

619
00:32:14,200 --> 00:32:16,360
Speaker 17: So what makes us very very unique is the fact

620
00:32:16,440 --> 00:32:19,760
Speaker 17: that we have next generation technology physically I platform that

621
00:32:19,880 --> 00:32:22,160
Speaker 17: for the first time in the industry, in the industry

622
00:32:22,520 --> 00:32:25,880
Speaker 17: is going to be able to drive both fhon factors

623
00:32:26,000 --> 00:32:28,920
Speaker 17: robotaxes as well as the driving trucks. We are very

624
00:32:29,000 --> 00:32:31,800
Speaker 17: advanced in terms of both the technology as well as

625
00:32:31,880 --> 00:32:36,080
Speaker 17: commercialization in trucking and now you know entering robotaxi, and

626
00:32:36,160 --> 00:32:38,479
Speaker 17: we're going to enter robotaxi really really quickly. So it's

627
00:32:38,600 --> 00:32:41,520
Speaker 17: very you know, it's great to see that, you know,

628
00:32:41,600 --> 00:32:45,320
Speaker 17: this next generation technology enables you to go so much faster,

629
00:32:45,520 --> 00:32:48,240
Speaker 17: so much more capital efficient, and with a product that

630
00:32:48,400 --> 00:32:49,840
Speaker 17: really miss the customer demands.

631
00:32:51,600 --> 00:32:55,000
Speaker 2: Okue, Well, congratulations on the round, you know, really notable.

632
00:32:56,000 --> 00:32:59,080
Speaker 2: It reads like the money that's coming in from Uber

633
00:32:59,360 --> 00:33:03,440
Speaker 2: is continue on. You hitding some milestones in robotaxi, right,

634
00:33:03,560 --> 00:33:06,160
Speaker 2: your focus has been autonomous trucking.

635
00:33:06,280 --> 00:33:07,640
Speaker 5: What are those milestones in.

636
00:33:07,800 --> 00:33:10,960
Speaker 2: Robotaxi that Uber requires you to hit so you can

637
00:33:11,080 --> 00:33:12,400
Speaker 2: unlock access to that cash.

638
00:33:14,080 --> 00:33:16,560
Speaker 17: So so not sharing a lot of details yet on

639
00:33:16,960 --> 00:33:20,400
Speaker 17: the amazing partnership with Uber, but those are simple milestones

640
00:33:20,440 --> 00:33:23,480
Speaker 17: that we can you know, we can achieve quickly and

641
00:33:24,120 --> 00:33:26,280
Speaker 17: you know, thanks to the technology that we have, you know,

642
00:33:26,360 --> 00:33:29,240
Speaker 17: already today we have the capabilities to you know, the

643
00:33:29,280 --> 00:33:32,440
Speaker 17: core capabilities required for robot taxis with our cell arriving

644
00:33:32,480 --> 00:33:35,920
Speaker 17: trucks unless the Unlike the rest of the industry, we

645
00:33:36,000 --> 00:33:39,160
Speaker 17: can drive not only on highways but in generalized surface streets.

646
00:33:40,120 --> 00:33:42,760
Speaker 17: So that's why you know, we feel, you know, very

647
00:33:42,880 --> 00:33:45,840
Speaker 17: confident that you know, we can enter robot taxi and

648
00:33:45,920 --> 00:33:48,640
Speaker 17: dis wrapted market really really, you know, swiftly.

649
00:33:50,320 --> 00:33:54,320
Speaker 2: You're Canadian company essentially, and one of the conversations that

650
00:33:54,360 --> 00:33:58,120
Speaker 2: we were having yesterday with Gattik is in American US

651
00:33:58,400 --> 00:34:01,720
Speaker 2: a need for a federal regulation. Your framework you able

652
00:34:01,720 --> 00:34:04,280
Speaker 2: to give me a kind of assessment of going to

653
00:34:04,440 --> 00:34:08,560
Speaker 2: market in Canada versus the United States, which jurisdiction you

654
00:34:08,760 --> 00:34:13,360
Speaker 2: think is ahead right in accommodating this nascent technology.

655
00:34:14,360 --> 00:34:17,640
Speaker 17: Yeah, the US is definitely ahead of the Canadian market

656
00:34:18,560 --> 00:34:22,320
Speaker 17: in terms of you know, regulatory peace as well as adoption,

657
00:34:23,600 --> 00:34:26,279
Speaker 17: and Canada has to do you know, quite a bit

658
00:34:26,320 --> 00:34:28,520
Speaker 17: to catch up. But there is a lot of excitement

659
00:34:28,560 --> 00:34:32,000
Speaker 17: on the Canadian eical system to make this possible. They

660
00:34:32,080 --> 00:34:34,759
Speaker 17: really understand that this technology has so many benefits from

661
00:34:34,840 --> 00:34:39,760
Speaker 17: safety to you know, all the efficiency that is, sustainability,

662
00:34:39,880 --> 00:34:43,000
Speaker 17: extra sustainability that is going to come with the technology.

663
00:34:43,080 --> 00:34:46,560
Speaker 17: So definitely there is a desire, but the US is

664
00:34:46,840 --> 00:34:50,400
Speaker 17: way ahead of Canada. So we will you know, for us,

665
00:34:50,440 --> 00:34:52,640
Speaker 17: our first market has been over the last couple of

666
00:34:52,760 --> 00:34:57,360
Speaker 17: years for tracking really the US or a march lagger

667
00:34:58,080 --> 00:35:00,560
Speaker 17: market and then we will see a out you know,

668
00:35:01,120 --> 00:35:02,719
Speaker 17: more expansion in the years to come.

669
00:35:04,640 --> 00:35:09,760
Speaker 3: What's interesting is that you've been in AI deeply entrenched

670
00:35:09,840 --> 00:35:12,240
Speaker 3: in the academic side of it, still a full professor

671
00:35:12,320 --> 00:35:14,959
Speaker 3: over in the University of Toronto for twenty five years.

672
00:35:15,520 --> 00:35:17,879
Speaker 4: Is talent everyone is for you people, so know who

673
00:35:17,920 --> 00:35:18,120
Speaker 4: you are.

674
00:35:18,120 --> 00:35:20,680
Speaker 3: They must gravitate towards the expertise you've brought in physical AI.

675
00:35:20,840 --> 00:35:23,400
Speaker 3: But it's getting very expensive. Is that almost what some

676
00:35:23,480 --> 00:35:24,560
Speaker 3: of this funding round is for.

677
00:35:26,320 --> 00:35:29,640
Speaker 17: It's a great, great point, Caroline. So there is definitely

678
00:35:29,760 --> 00:35:32,759
Speaker 17: you know, a lot of you know, talent war for

679
00:35:33,360 --> 00:35:36,480
Speaker 17: EI these days with obviously the revolution that is happening.

680
00:35:37,480 --> 00:35:40,160
Speaker 17: But you know why we can't attract the best in

681
00:35:40,280 --> 00:35:41,719
Speaker 17: class without paying premiums.

682
00:35:42,760 --> 00:35:44,960
Speaker 4: And the reason why is that if you're.

683
00:35:44,840 --> 00:35:48,360
Speaker 17: Interested in physically, if you're interested in you know, bringing

684
00:35:48,440 --> 00:35:50,200
Speaker 17: a product that is you know, you said, once in

685
00:35:50,320 --> 00:35:54,600
Speaker 17: a lifetime or in a generation sort of opportunity to

686
00:35:54,920 --> 00:35:57,239
Speaker 17: really change the world as we know it today, and

687
00:35:57,360 --> 00:36:00,840
Speaker 17: you want to do it with innovative technology that and

688
00:36:00,920 --> 00:36:03,200
Speaker 17: really pushing the industry to the next level, then what

689
00:36:03,480 --> 00:36:05,759
Speaker 17: is the place to be? And that's what you know,

690
00:36:05,920 --> 00:36:09,080
Speaker 17: we have hired divesting class, you know, talent team, and

691
00:36:09,120 --> 00:36:11,640
Speaker 17: we continue to attract the best in class. And you

692
00:36:11,719 --> 00:36:14,320
Speaker 17: know also what attention numbers are of the chart, so

693
00:36:14,480 --> 00:36:18,120
Speaker 17: definitely you know, amassing team and we continue to double

694
00:36:18,239 --> 00:36:19,320
Speaker 17: down in terms of hiring.

695
00:36:20,840 --> 00:36:23,160
Speaker 2: Okay, I have another question about Canada, and you know,

696
00:36:23,280 --> 00:36:25,279
Speaker 2: forgive me, it's just been so much in the news

697
00:36:25,360 --> 00:36:29,080
Speaker 2: recently the ecosystem in Canada. You probably saw that why

698
00:36:29,239 --> 00:36:34,360
Speaker 2: Combinator cut Canada from its list of countries that it

699
00:36:34,360 --> 00:36:37,680
Speaker 2: would invest in startups in what do you make of that?

700
00:36:37,840 --> 00:36:40,120
Speaker 2: And like what is the ecosystem in Canada right now?

701
00:36:40,200 --> 00:36:42,640
Speaker 2: Like on the software and hardware side, do you see

702
00:36:42,719 --> 00:36:46,560
Speaker 2: the talent pool that you need available in your home country.

703
00:36:47,360 --> 00:36:49,600
Speaker 17: Yeah, so I'm not going to comment on you know,

704
00:36:50,040 --> 00:36:53,080
Speaker 17: you know why combinitory specifically, but I will say that,

705
00:36:53,280 --> 00:36:55,560
Speaker 17: you know, there is a vibrant, you know, take an

706
00:36:55,640 --> 00:36:59,400
Speaker 17: ecosystem in Canada. You know, as you as you know,

707
00:37:00,120 --> 00:37:02,080
Speaker 17: Canada has been at the forefront of really all the

708
00:37:02,200 --> 00:37:04,879
Speaker 17: innovation and the majority of the innovation that under pin

709
00:37:05,400 --> 00:37:08,080
Speaker 17: the AI revolution that we're seeing today with folks like

710
00:37:08,160 --> 00:37:11,279
Speaker 17: you know, give Hinton, Nobel, Price, et cetera. Right, So,

711
00:37:11,760 --> 00:37:15,200
Speaker 17: so the talent is there, the CoSystem is there, and uh,

712
00:37:15,520 --> 00:37:17,320
Speaker 17: you know, from my perspective, you know, Wabi is a

713
00:37:17,360 --> 00:37:20,120
Speaker 17: proud Canadian company and there is you know a few

714
00:37:20,200 --> 00:37:23,239
Speaker 17: others that are really leading the way. And it's a mass.

715
00:37:23,280 --> 00:37:25,080
Speaker 17: You know, it's an amazing market. And if you look

716
00:37:25,120 --> 00:37:28,200
Speaker 17: at that list of investors, you know, we have plenty

717
00:37:28,280 --> 00:37:30,680
Speaker 17: from the value plenty for Canada from Canada as well

718
00:37:30,719 --> 00:37:33,239
Speaker 17: as Europe and the even me the list now, so

719
00:37:34,239 --> 00:37:36,000
Speaker 17: you know, I will say that we you know, Canada

720
00:37:36,080 --> 00:37:39,520
Speaker 17: can really attract capital from you know, across the globe

721
00:37:40,040 --> 00:37:42,879
Speaker 17: and and you know it's it's a miss if you don't,

722
00:37:43,000 --> 00:37:44,040
Speaker 17: you don't invest in Canada.

723
00:37:45,320 --> 00:37:45,640
Speaker 5: Thank you.

724
00:37:45,880 --> 00:37:49,520
Speaker 2: Riquel Edison, CEO and founder of WARB closing seven hundred

725
00:37:49,520 --> 00:37:52,480
Speaker 2: and fifty million dollar Series C, taking up to a

726
00:37:52,560 --> 00:37:54,200
Speaker 2: billion dollars with support from Uber to.

727
00:37:56,960 --> 00:37:57,440
Speaker 4: Wool Street.

728
00:37:58,400 --> 00:38:01,040
Speaker 3: Feeling some mixed signals on has ahead of its earnings

729
00:38:01,120 --> 00:38:04,400
Speaker 3: price targets. For the ev maker, they're rising despite investor

730
00:38:04,440 --> 00:38:06,239
Speaker 3: concerns over its earnings potential this year.

731
00:38:06,800 --> 00:38:09,320
Speaker 4: Here with more is Steve Man a Bluemeg Intelligence and

732
00:38:09,440 --> 00:38:09,880
Speaker 4: for Tesla.

733
00:38:09,960 --> 00:38:11,800
Speaker 3: It's always a question of whether you care about the

734
00:38:11,840 --> 00:38:14,520
Speaker 3: fundamentals and the court are just gone, or whether you're

735
00:38:14,560 --> 00:38:17,719
Speaker 3: betting on AI optimists and the future of robotics.

736
00:38:18,920 --> 00:38:19,080
Speaker 6: Yeah.

737
00:38:19,200 --> 00:38:20,960
Speaker 16: I think if you look at the stock price over

738
00:38:21,000 --> 00:38:23,719
Speaker 16: the last quarter, there's definitely some push and pull on

739
00:38:23,800 --> 00:38:27,359
Speaker 16: the stock price. It's been pretty steady where it's at

740
00:38:28,440 --> 00:38:32,120
Speaker 16: at the moment. So there are two camps. One is

741
00:38:32,280 --> 00:38:34,960
Speaker 16: looking at the business fundamentals. You know, sales in the

742
00:38:34,960 --> 00:38:38,000
Speaker 16: fourth quarter was down fifteen to sixteen percent, not you know,

743
00:38:38,080 --> 00:38:40,080
Speaker 16: there's been a lot of pull ahead before the seventy

744
00:38:40,120 --> 00:38:45,240
Speaker 16: five hundred dollars US tax credit went away, so earnings

745
00:38:45,280 --> 00:38:48,839
Speaker 16: are probably not gonna be pretty. But on the other camp,

746
00:38:49,360 --> 00:38:53,520
Speaker 16: you know, investors are really stoked with their cybercav robot

747
00:38:53,600 --> 00:38:54,280
Speaker 16: taxi rollout.

748
00:38:55,480 --> 00:38:59,040
Speaker 2: Steve, in your January twelfth preview, you wrote that twenty

749
00:38:59,080 --> 00:39:01,800
Speaker 2: six is the pivot for AI and robotics, right, and

750
00:39:02,360 --> 00:39:04,920
Speaker 2: that you expect management to talk up those things.

751
00:39:05,480 --> 00:39:06,960
Speaker 5: But what do you actually need to hear?

752
00:39:07,600 --> 00:39:10,160
Speaker 2: What things of substance do you want Musks to say

753
00:39:10,320 --> 00:39:12,880
Speaker 2: on the call that actually will be a driver of

754
00:39:13,000 --> 00:39:16,319
Speaker 2: confidence in the near term, even if that is this year.

755
00:39:17,520 --> 00:39:20,560
Speaker 16: Yeah, I think investors is very anxious about that. You know,

756
00:39:20,920 --> 00:39:24,280
Speaker 16: Elon Musk has talked about you know, the vision system,

757
00:39:24,760 --> 00:39:28,759
Speaker 16: self driving vision system that they're rolling out. There's a

758
00:39:28,800 --> 00:39:32,600
Speaker 16: lot of anticipation because you know, I think the next

759
00:39:32,800 --> 00:39:36,560
Speaker 16: leg for the company is really scaling that business. So

760
00:39:36,760 --> 00:39:41,080
Speaker 16: it's about robotaxi, it's about rolling out the cybercab, the

761
00:39:41,239 --> 00:39:48,040
Speaker 16: new you know, steering wheelless brake, pedaliss vehicle, and the

762
00:39:48,360 --> 00:39:55,120
Speaker 16: f ST subscription. So, I mean there's investors are very

763
00:39:55,200 --> 00:39:59,359
Speaker 16: stoked about this, and they're really looking for Elon mus

764
00:39:59,440 --> 00:40:02,160
Speaker 16: to tell them that, hey, in the next three to

765
00:40:02,239 --> 00:40:04,480
Speaker 16: six months. We are really going to scale it up

766
00:40:04,560 --> 00:40:05,759
Speaker 16: beyond astin.

767
00:40:06,760 --> 00:40:08,920
Speaker 2: See Man of bloom Megan Intelligence. We're all bracing for

768
00:40:09,000 --> 00:40:12,480
Speaker 2: aftermarket today and Tesla. We're also bracing for Meta, which

769
00:40:12,520 --> 00:40:15,800
Speaker 2: reports after the bow. Investors are focused on AI capital

770
00:40:15,840 --> 00:40:18,839
Speaker 2: expenditure plans for twenty twenty six, which analysts say could

771
00:40:18,920 --> 00:40:24,040
Speaker 2: overshadow the company's advertising revenue growth. Luvis Kurt Wagner joins

772
00:40:24,080 --> 00:40:27,319
Speaker 2: us for the details. It's a pretty familiar formula at

773
00:40:27,360 --> 00:40:30,040
Speaker 2: this point. I hand it over to you. Give us

774
00:40:30,080 --> 00:40:32,040
Speaker 2: the Meta earnings preview as best you can.

775
00:40:33,120 --> 00:40:34,920
Speaker 18: I feel like we've been talking about a lot of

776
00:40:34,960 --> 00:40:37,160
Speaker 18: the same stuff for the past year, which is what

777
00:40:37,400 --> 00:40:40,120
Speaker 18: is spending going to look like? And can the company

778
00:40:40,239 --> 00:40:43,000
Speaker 18: paint this picture for investors that all the spending ultimately

779
00:40:43,080 --> 00:40:45,840
Speaker 18: pay off down the line. And you remember it was

780
00:40:45,920 --> 00:40:48,120
Speaker 18: just a year ago that Mark Zuckerberg was saying, hey,

781
00:40:48,200 --> 00:40:51,320
Speaker 18: record spending up to sixty five billion in capital expenditures,

782
00:40:51,360 --> 00:40:54,040
Speaker 18: and everyone's head spun around, you know, crazy to think

783
00:40:54,080 --> 00:40:56,280
Speaker 18: of that. I saw the estimates on the Bloomberg today

784
00:40:56,360 --> 00:40:59,239
Speaker 18: that they think capital expenditures could be one hundred and

785
00:40:59,280 --> 00:41:02,279
Speaker 18: eleven billion dollars for Meta in twenty twenty six, and

786
00:41:02,400 --> 00:41:05,239
Speaker 18: so it's just hard to quantify, you know, easy to

787
00:41:05,320 --> 00:41:08,600
Speaker 18: quantify a harder rager head around the jump we've seen

788
00:41:08,680 --> 00:41:11,040
Speaker 18: and spending from this company in particular as they rush

789
00:41:11,120 --> 00:41:12,800
Speaker 18: toward AI, and there's going to be a lot of

790
00:41:12,880 --> 00:41:15,960
Speaker 18: questions about what the ROI on that is going forward.

791
00:41:16,400 --> 00:41:19,520
Speaker 4: And that is why the stock has taken some hits.

792
00:41:19,600 --> 00:41:21,680
Speaker 3: I mean, initially it was talk up your capex and

793
00:41:21,760 --> 00:41:24,320
Speaker 3: you're rewarded for it, but then in the last innings,

794
00:41:24,400 --> 00:41:26,200
Speaker 3: I'm just looking at the chart of how swiftly they

795
00:41:26,280 --> 00:41:28,759
Speaker 3: fell back in October as maybe we then started to

796
00:41:28,800 --> 00:41:31,880
Speaker 3: be worried about the commitment of capital expenditure.

797
00:41:32,080 --> 00:41:34,320
Speaker 4: How can they steady nerves in other parts of the business.

798
00:41:34,360 --> 00:41:35,400
Speaker 3: What do we need to hear on the bread and

799
00:41:35,480 --> 00:41:36,520
Speaker 3: butter of ads sales?

800
00:41:36,560 --> 00:41:39,719
Speaker 18: And they like, well, I imagine we'll hear them talk

801
00:41:39,760 --> 00:41:43,239
Speaker 18: about how AI is improving ads today, right, and that's

802
00:41:43,320 --> 00:41:45,600
Speaker 18: going to be in automated campaigns, that's going to be

803
00:41:45,640 --> 00:41:48,440
Speaker 18: in better targeting, pretty much anything they can do to show, hey,

804
00:41:48,480 --> 00:41:51,280
Speaker 18: look this this fifty billion dollar data center we're building

805
00:41:51,320 --> 00:41:54,440
Speaker 18: in Louisiana is actually helping our revenue or will help

806
00:41:54,480 --> 00:41:57,200
Speaker 18: our revenue immediately. I think that's going to be very

807
00:41:57,239 --> 00:42:00,279
Speaker 18: important because a lot of their futuristic bets we talked

808
00:42:00,320 --> 00:42:03,520
Speaker 18: about the metaverse on here, virtual reality, even the AI glasses,

809
00:42:03,560 --> 00:42:05,080
Speaker 18: which seem to be going well. I mean, these are

810
00:42:05,239 --> 00:42:08,279
Speaker 18: not driving meaningful revenue to the company, and yet they

811
00:42:08,320 --> 00:42:13,279
Speaker 18: are sucking tons of cash to operate, and so that

812
00:42:13,560 --> 00:42:15,439
Speaker 18: is the trade off. A lot of the big bets

813
00:42:15,480 --> 00:42:19,000
Speaker 18: still haven't materialized on the revenue side just yet. So

814
00:42:19,120 --> 00:42:21,040
Speaker 18: they need to show that AI is continuing to help

815
00:42:21,080 --> 00:42:21,960
Speaker 18: on that ads business.

816
00:42:22,760 --> 00:42:24,879
Speaker 3: Most Kurt Wagner, He's going to be all over them

817
00:42:25,400 --> 00:42:26,600
Speaker 3: post the bell today.

818
00:42:26,719 --> 00:42:30,279
Speaker 4: Thank you. That does it for this meeting edition of

819
00:42:30,320 --> 00:42:32,000
Speaker 4: Bloomberg Tech. So much more to comment.

820
00:42:32,880 --> 00:42:35,520
Speaker 2: Yeah, the mag seven starts in ernest. Today is the

821
00:42:35,640 --> 00:42:39,040
Speaker 2: day and it's the market run up going into it

822
00:42:39,920 --> 00:42:40,439
Speaker 2: kind of got.

823
00:42:40,400 --> 00:42:43,239
Speaker 5: Me on edge, you know, recap on the podcast. Carry's right,

824
00:42:43,280 --> 00:42:43,719
Speaker 5: it was meeting.

825
00:42:43,760 --> 00:42:47,440
Speaker 2: You know where to find it on the Bloomberg platforms online, Apple, Spotify,

826
00:42:47,920 --> 00:42:50,919
Speaker 2: and iHeart. I know I'll be at my desk after

827
00:42:51,000 --> 00:42:53,719
Speaker 2: the market bell. I know what I'm bracing for. Question

828
00:42:53,920 --> 00:42:56,480
Speaker 2: is will you be back with us? This is Bloomberg

829
00:42:56,520 --> 00:42:56,719
Speaker 2: Tech