WEBVTT - Airbnb and Uber Earnings, Nancy Pelosi's Taiwan Visit (Podcast) 0:00:01.280 --> 0:00:04.560 From the heart of where innovation, money and power COLLI 0:00:05.400 --> 0:00:09.960 in Silicon Valley and beyond. This is Bloomberg Technology with 0:00:10.000 --> 0:00:26.279 Emily Jay I'm memorily check in San Francisco and this 0:00:26.320 --> 0:00:28.560 is Bloomberg Technology. Coming up in the next hour. It 0:00:28.640 --> 0:00:31.280 looks like we are in for a busy holiday travel season. 0:00:31.360 --> 0:00:35.279 Airbnb is preparing a massive share buyback and anticipating the 0:00:35.280 --> 0:00:38.440 best revenue in the company history in the current quarter. 0:00:38.600 --> 0:00:42.120 We will get into the details, plus a being for 0:00:42.240 --> 0:00:46.680 Uber send share story almost my conversation with CEO dar 0:00:46.800 --> 0:00:50.080 Kasra Shai about the shift in demand supply and whether 0:00:50.200 --> 0:00:54.680 Uber really is as he says, recession proof. And the 0:00:54.720 --> 0:00:58.400 results are in Bloomberg survey more than fift hundred investors 0:00:58.400 --> 0:01:01.240 about the musk Twitter saga, only one in four. I 0:01:01.240 --> 0:01:03.360 believe the world which is man will actually end up 0:01:03.360 --> 0:01:06.320 shelling out that four billion dollars. We'll talk about the 0:01:06.360 --> 0:01:10.720 implications for musk Twitter and Tesla. I do want to 0:01:10.720 --> 0:01:13.119 talk a little more about this big visit. US House 0:01:13.120 --> 0:01:17.280 speaker Nancy Pelosi touching down in Taiwan. This makes her 0:01:17.319 --> 0:01:20.520 the highest ranking American politician to visit the island in 0:01:20.560 --> 0:01:23.399 twenty five years, and the timing of her visit is 0:01:23.440 --> 0:01:27.959 particularly sensitive for China, coming one day after the anniversary 0:01:28.319 --> 0:01:31.480 of the People's Liberation Army. I want to bring in 0:01:31.640 --> 0:01:36.119 our Ian Marlow joining us from Washington, who's been covering 0:01:36.120 --> 0:01:38.760 the story and how it is developing. Ian talk to 0:01:38.880 --> 0:01:43.120 us about just how significant this visit is and and 0:01:43.200 --> 0:01:45.160 what is at stake. We've got Isaac stone Fish, the 0:01:45.160 --> 0:01:48.440 founder and CEO of Strategy Risks here as well. But Ian, 0:01:48.480 --> 0:01:49.840 I want to start with you because I think it's 0:01:49.880 --> 0:01:56.160 hard to overstate, uh, just how significant this visit is. Yeah, 0:01:56.200 --> 0:01:58.680 I think it's significant for a couple of reasons. I mean, obviously, 0:01:58.680 --> 0:02:00.800 she's the highest ranking of like the U s official 0:02:00.840 --> 0:02:03.400 to visit in twenty five years, since Sitting House Speaker 0:02:03.640 --> 0:02:07.640 New Grinkoch went in ninete. But it's also a sensitive 0:02:07.640 --> 0:02:11.880 time in US China relations. You've got forces on both sides. 0:02:12.200 --> 0:02:14.840 In the US, you've got midterm elections, you had a 0:02:14.840 --> 0:02:18.040 lot of uh debate about whether she should go or 0:02:18.080 --> 0:02:20.640 not go, and whether that would look weak on China. 0:02:21.200 --> 0:02:25.679 And then in China itself you have Shi jimping kind 0:02:25.680 --> 0:02:29.280 of balancing UH COVID zero policies with a bit of 0:02:29.280 --> 0:02:33.240 a slowing economy, and also a really important party congress 0:02:33.280 --> 0:02:36.920 coming up later in the fall where he's expected to 0:02:36.919 --> 0:02:39.320 secure a third term. So you've got a lot of 0:02:39.520 --> 0:02:43.440 sensitive dynamics internally. And then uh, you know, internationally, we 0:02:43.520 --> 0:02:46.840 just have a situation with the US leaning on on 0:02:47.040 --> 0:02:51.400 China over Russia and the war in Ukraine. You've got 0:02:51.400 --> 0:02:54.440 a lot of high level dialogues that haven't particularly moved 0:02:54.520 --> 0:02:58.920 the needle on the Biden administration's China policy. Uh. And 0:02:59.000 --> 0:03:03.880 then you're playing with this extremely toxic situation with where 0:03:04.000 --> 0:03:07.720 Taiwan is just the most sensitive issue in US China relations. 0:03:08.120 --> 0:03:12.320 Uh and Pelosi visiting at this point, with the rhetoric 0:03:12.360 --> 0:03:15.400 cranked up on on the Chinese side in particular in 0:03:15.520 --> 0:03:19.799 US US officials kind of failing to calm down and 0:03:19.960 --> 0:03:22.480 kind of convince the Chinese side that that they're not 0:03:22.520 --> 0:03:25.680 trying to, you know, erase the status quo here, it's 0:03:25.720 --> 0:03:27.880 kind of got a bit of a mix where we're 0:03:27.880 --> 0:03:32.519 now seeing some of the more the most extreme sort 0:03:32.560 --> 0:03:35.840 of Chinese military responses since since the mid nineties, in 0:03:35.920 --> 0:03:41.680 decades now. ISAAC China has already announced these various military 0:03:41.800 --> 0:03:46.160 drills at missile tests surrounding the island. How much retaliation 0:03:46.640 --> 0:03:52.040 versus posturing are you expecting to see companies should shear 0:03:52.160 --> 0:03:58.600 retaliation asymmetrically, So worry less about military drills, more about 0:03:59.240 --> 0:04:04.480 executive from US corporations getting arrested or detained or harassed 0:04:04.520 --> 0:04:09.600 in China, or Chinese companies treating US companies differently, or 0:04:09.800 --> 0:04:14.920 Beijing suddenly discovering that a major US corporation committed tax 0:04:14.960 --> 0:04:18.560 fraud or has some regularities in their books. Beijing loves 0:04:18.640 --> 0:04:22.400 to play it this way so that there's plausible deniability, 0:04:22.680 --> 0:04:25.479 and so that it reminds the business world that, in 0:04:25.560 --> 0:04:29.240 Beijing's mind, the business world is also responsible for what 0:04:29.279 --> 0:04:33.120 the US government is or isn't doing. We've already seen 0:04:33.360 --> 0:04:37.760 some retaliation from this big battery company that's pushed back 0:04:37.800 --> 0:04:41.240 its plans to announce a big plant UH in North America. 0:04:41.320 --> 0:04:44.360 Of course, Taiwan is a huge tech hub, a huge 0:04:44.480 --> 0:04:48.360 spoke in the global supply chain. What kind of disruption 0:04:48.440 --> 0:04:51.560 potentially longer term, ISAAC, do you think there could be 0:04:51.839 --> 0:04:55.160 to the global and tech economy. It's hard to imagine 0:04:55.160 --> 0:04:59.600 a more concrete reminder that investing in China Chinese supply 0:04:59.720 --> 0:05:03.440 chain U S China relations will be unstable for the 0:05:03.520 --> 0:05:08.840 foreseeable future. Base case and now is these regular fluctuations, 0:05:08.880 --> 0:05:12.440 the regular risk of not getting the goods when you 0:05:12.520 --> 0:05:15.080 need them, not being able to parse or really understand 0:05:15.160 --> 0:05:18.120 Chinese policy. So people just need to throw out their 0:05:18.160 --> 0:05:21.320 old assumptions and work with the assumptions that supply chains 0:05:21.360 --> 0:05:24.680 will continue to be disrupted. Certain companies that say they're 0:05:24.720 --> 0:05:27.000 going to do something won't be able to do what 0:05:27.080 --> 0:05:30.000 they're saying. And not to be alarmists, but it is 0:05:30.120 --> 0:05:33.919 very possible that moves like these do lead to a war, 0:05:34.160 --> 0:05:36.120 or at the very least the proxy war between the 0:05:36.200 --> 0:05:38.680 U S and China, and if that happens, all of 0:05:38.720 --> 0:05:43.120 the assumptions underpinning US China investments for decades will be 0:05:43.160 --> 0:05:46.320 written off. I talk to us about the plans for 0:05:46.360 --> 0:05:48.479 the rest of this trip and the kind of signaling 0:05:48.600 --> 0:05:52.039 you're expecting to see, not just from Beijing but also 0:05:52.160 --> 0:05:55.760 from the White House. Yeah, I mean, I think we've 0:05:55.760 --> 0:05:58.800 seen the White House playbook. Over the last couple of days. 0:05:58.880 --> 0:06:01.960 There was a shift for um, uh you know, denying 0:06:02.000 --> 0:06:05.040 that the trip was even happening, possibly the worst kept 0:06:05.080 --> 0:06:09.400 secret given it was the most tracked plane. Uh you know, 0:06:09.480 --> 0:06:12.840 almost in history here. Um. I think at the moment, 0:06:12.920 --> 0:06:16.200 we're looking at the White House shifting to uh, putting 0:06:16.200 --> 0:06:21.400 the onus for escalation on on China itself, saying Pelosi's trip, 0:06:21.839 --> 0:06:25.599 which we didn't have any say over, doesn't move the needle. 0:06:25.960 --> 0:06:31.160 It doesn't change US policy towards Taiwan either way. And 0:06:31.240 --> 0:06:34.039 so it's the kind of ball is in is in 0:06:34.120 --> 0:06:38.520 China's court. So the the amount of escalation we see, uh, 0:06:38.560 --> 0:06:41.000 you know. And some people are talking about the military 0:06:41.000 --> 0:06:43.760 exercises off off the ports and off the coast amounting 0:06:43.760 --> 0:06:47.279 to a sort of an effective sort of temporary blockade. 0:06:47.760 --> 0:06:52.680 We're also going to see missiles potentially crossing over Taiwan 0:06:52.800 --> 0:06:55.680 and landing off the coast. Um, so there's a potential 0:06:55.720 --> 0:06:59.000 for miscalculation. I think at the moment we're just kind 0:06:59.000 --> 0:07:01.000 of waiting to see how long this last. We know 0:07:01.040 --> 0:07:03.359 there's going to be drills, uh you know, for the 0:07:03.400 --> 0:07:06.479 next few days. Um. And now I think it's just 0:07:06.560 --> 0:07:10.320 a matter of seeing whether China's telegraphing of this stuff 0:07:10.360 --> 0:07:13.880 in advance is enough to allow US officials to sort 0:07:13.920 --> 0:07:17.160 of manage the situation so that there's no you know, 0:07:17.160 --> 0:07:19.360 as they always talk about in US China relations now 0:07:20.000 --> 0:07:22.440 to make sure there's no miscalculation, uh, you know, and 0:07:22.960 --> 0:07:26.280 veering the competition into conflict. As they also like to say, 0:07:26.800 --> 0:07:29.880 all right, thank you both so much for weighing in here, 0:07:29.920 --> 0:07:34.160 strategy risks CEO Isaac Stonefish, along with Bloomer's own in Marlow. 0:07:34.200 --> 0:07:36.600 Of course, we're going to continue to follow every detail 0:07:37.040 --> 0:07:48.240 of this visit as it plays out. Airbnb shares down 0:07:48.240 --> 0:07:50.800 in late training after reporting second quarter results. This despite 0:07:50.800 --> 0:07:53.040 the home sharing giant saying revenue in the current quarter 0:07:53.360 --> 0:07:56.840 will be the highest in its history. Brent Phil Jeffrey's 0:07:56.840 --> 0:08:00.560 managing director and analyst, joins us now to discuss So, look, 0:08:00.640 --> 0:08:04.480 you've had AIRBNBI benefiting from the travel rebound, but investors 0:08:04.520 --> 0:08:10.520 not happy with this report. Why is that booking's actually 0:08:10.560 --> 0:08:13.720 fell emily for the third quarter in terms of below consensus, 0:08:13.800 --> 0:08:17.360 about five percent below where the street was at. And 0:08:17.400 --> 0:08:20.440 I think ultimately there's also a fear that this was 0:08:20.520 --> 0:08:23.800 the summer of travel that everyone went to Europe. You 0:08:23.840 --> 0:08:28.480 can see local destinations inside California, for example, saw their 0:08:28.480 --> 0:08:32.000 bookings down, but Europe saw this huge boom. Many of us, 0:08:32.120 --> 0:08:35.160 including my own family, who went to Europe came back 0:08:35.200 --> 0:08:37.520 and started to look at our credit card and say, wow, okay, 0:08:37.760 --> 0:08:39.600 we haven't been been anywhere for a couple of years 0:08:39.840 --> 0:08:42.120 to look at the bill. And so I think there's 0:08:42.400 --> 0:08:44.840 perhaps a little bit of a travel hangover coming in 0:08:44.880 --> 0:08:48.200 the fall into the winner. And that may also be 0:08:48.440 --> 0:08:51.640 a fear that many investors that are in my position 0:08:51.679 --> 0:08:53.679 now have said, Hey, I just took the big trip, 0:08:54.080 --> 0:08:57.080 tap time, tap the tap the air brakes and put 0:08:57.120 --> 0:09:00.640 money into other things. Uh. That's that's one element. I think. 0:09:00.720 --> 0:09:05.440 Ultimately the macro condition is starting to show signs of weakness. 0:09:05.480 --> 0:09:09.320 You're seeing gas prices in the or uh you know, 0:09:09.360 --> 0:09:11.960 shift where they're spending dollars. If Walmart called this out, 0:09:12.000 --> 0:09:14.679 a lot of other companies are calling this the shift out. 0:09:14.760 --> 0:09:18.360 Williamson our restoration of hardware obviously saying it's not can 0:09:18.440 --> 0:09:20.480 be is good in the back half. You're you're just 0:09:20.520 --> 0:09:23.760 seeing across many consumers. So we call it a discretionary 0:09:23.920 --> 0:09:28.640 recession that many of us may start to rethink were 0:09:28.720 --> 0:09:32.920 these dollars today that AIRBB for the most part, are 0:09:33.080 --> 0:09:36.440 you know, is spent money that is for fun? It's 0:09:36.480 --> 0:09:38.840 not it's not a must have, it's a it's nice 0:09:38.840 --> 0:09:42.800 to have. They'll argue other otherwise for for myself, but 0:09:42.840 --> 0:09:45.080 I'm trying to What I'm trying to put in is 0:09:45.640 --> 0:09:47.560 what what Why would the stock be down? Why would 0:09:47.559 --> 0:09:50.199 people be barished from here? I think those would be 0:09:50.240 --> 0:09:53.439 the reasons to be bullish. Obviously, they're in an incredible position, 0:09:53.559 --> 0:09:58.679 amazing management team, incredible selection of uh and portfolio, and 0:09:58.720 --> 0:10:01.439 I think they're really innovating on the platform, and there's 0:10:01.440 --> 0:10:05.679 just incredible innovation relative to any other consumer brand you 0:10:06.040 --> 0:10:08.760 travel to on the web. I still think this is 0:10:08.800 --> 0:10:11.720 the best you want, best experience. Some of the best 0:10:11.800 --> 0:10:15.520 content They did come out with categories, which was their 0:10:15.520 --> 0:10:18.640 big design change in the last few months. You do 0:10:18.760 --> 0:10:22.120 cover Uber as well, and I'm kind of interested in 0:10:22.160 --> 0:10:24.199 comparing them. But first I want you to hear this 0:10:24.559 --> 0:10:26.880 quote from Dar cause were showing you from our interview 0:10:27.200 --> 0:10:28.959 earlier today. He is said in the past he thinks 0:10:29.080 --> 0:10:34.880 Uber is recession proof. Take a listen to why. Because 0:10:34.920 --> 0:10:38.520 we're in multiple businesses, both in mobility and delivery. I 0:10:38.559 --> 0:10:41.400 think we have a kind of business that can perform 0:10:41.559 --> 0:10:44.400 in all weather. But at the same time, we are 0:10:44.480 --> 0:10:47.480 being disciplined in terms of costs to make sure that 0:10:47.800 --> 0:10:51.240 as the environment if it gets tougher, we are prepared. 0:10:53.720 --> 0:10:55.760 Right you saw Uber's nembers today. Do you think Uber 0:10:55.800 --> 0:10:59.520 really is recession proof and is it more recession proof 0:10:59.559 --> 0:11:02.959 and air being be I think to some degree, because 0:11:02.960 --> 0:11:05.760 we're starting to go back to work or going back 0:11:05.760 --> 0:11:09.880 to events, we're traveling to kids sporting events, like we're 0:11:09.960 --> 0:11:13.320 using we're using their transportation, not only the cars, but 0:11:13.360 --> 0:11:16.080 the bikes and scooters. And again I was a huge 0:11:16.080 --> 0:11:19.880 adopter of of of the line uh scooter line this 0:11:19.960 --> 0:11:23.079 summer with my family in Europe and as a part 0:11:23.120 --> 0:11:25.760 in the partnership with Uber, and and I think ultimately 0:11:26.480 --> 0:11:29.559 I agree with that to to some degree. I think 0:11:29.640 --> 0:11:32.640 ultimately the question mark is going to be around the 0:11:32.720 --> 0:11:36.040 discretionary travel. And again when we look at Airbnb, if 0:11:36.080 --> 0:11:37.679 you look at other travel names, if we start to 0:11:37.679 --> 0:11:41.000 see a little bit of a travel hangover post this summer, 0:11:41.040 --> 0:11:43.200 there could be a little bit of a setback on 0:11:43.240 --> 0:11:47.959 that side. The positive thing for Uber is employers, including 0:11:48.000 --> 0:11:50.880 in our own employer, is saying get back in the office. 0:11:50.960 --> 0:11:54.080 We need you back multiple days a week. Obviously, we 0:11:54.120 --> 0:11:58.280 still have COVID cases flaring, and I think ultimately people 0:11:58.400 --> 0:12:01.439 are still reluctant to want to be a mass transport 0:12:01.480 --> 0:12:04.080 in a big way, and they feel comfortable, you know, 0:12:04.160 --> 0:12:06.240 perhaps being in the back of a car going into 0:12:06.280 --> 0:12:09.439 the winter. If if, if we'd see another UH phase 0:12:09.480 --> 0:12:12.120 of COVID cases. So I think, look, I I don't 0:12:12.120 --> 0:12:14.480 disagree with them. I do think there's an element of 0:12:14.480 --> 0:12:17.000 the business that I could feel the pain. But one 0:12:17.040 --> 0:12:19.600 thing that's going for Uber right now is evaluation. It's 0:12:19.640 --> 0:12:22.440 the worst sentiment of any Internet company and perhaps any 0:12:22.480 --> 0:12:25.360 tech company we cover. And the sentiment going into this 0:12:25.480 --> 0:12:27.800 print was awful, and now they're showing cash flow and 0:12:27.840 --> 0:12:30.559 they're effectively doing what we think is the right thing 0:12:30.600 --> 0:12:33.319 was that it's just not a top it's got a 0:12:33.360 --> 0:12:35.640 bottom line, and they're showing they can be very profitable 0:12:36.160 --> 0:12:41.599 with with their network. Interesting, all right, Brent Phil Jefferies, 0:12:41.640 --> 0:12:43.880 managing Director, Thanks for giving us your quick reacts on 0:12:44.000 --> 0:12:47.400 both of those companies. Coming up a tale of two coasts. 0:12:47.559 --> 0:12:49.640 Uber is seeing a slowdown on the West coast but 0:12:49.800 --> 0:12:52.200 a pickup in the East. I have more of my 0:12:52.240 --> 0:12:55.280 post earnings conversation with Uber CEO dark cosbra Shy, who 0:12:55.280 --> 0:12:57.680 was quite happy about the stock pop when we talked 0:12:57.760 --> 0:13:22.080 this morning. He's coming up next. This is Bloomberg. Uber 0:13:22.200 --> 0:13:25.760 defied inflation in the second quarter, reporting better than expected earnings. 0:13:25.760 --> 0:13:29.240 Shares popped on that news that Lubers gross bookings including 0:13:29.320 --> 0:13:32.839 ride sharing, food delivery, and frank rose to an all 0:13:32.840 --> 0:13:35.640 time high. I spoke with CEO dar Causra Shay about 0:13:35.679 --> 0:13:38.800 everything from surge pricing to a slowdown in demand on 0:13:38.840 --> 0:13:42.240 the West Coast. Take a listen to some extent, it's 0:13:42.240 --> 0:13:46.240 a continuation of the last few quarters, but we're really 0:13:46.440 --> 0:13:49.760 hitting a scale point here. Like you said, twenty nine 0:13:49.840 --> 0:13:53.600 billion dollars in gross bookings of thirty six percent on 0:13:53.640 --> 0:13:56.560 a year on your basis, uh as, it relates on 0:13:56.600 --> 0:14:00.920 a constant currency basis or three sixty two million, well 0:14:01.040 --> 0:14:03.840 above our guidance range. And the guidance that we gave 0:14:03.880 --> 0:14:08.359 forward was well above street estimates, etcetera. So an indication 0:14:08.440 --> 0:14:11.760 of anticipated strength coming. And then a really important factor 0:14:11.800 --> 0:14:15.040 for us is we're free cash full positive two million 0:14:15.080 --> 0:14:19.400 dollars in free cash flow, which is a big positive 0:14:19.440 --> 0:14:22.920 factor in our being self sustaining and profitable going forward. 0:14:23.360 --> 0:14:26.640 And when we look at the environment, the marketplace is 0:14:26.640 --> 0:14:29.440 more balanced. The number of new drivers that we're adding 0:14:29.440 --> 0:14:31.800 in the US is up over seventy on a year 0:14:31.840 --> 0:14:36.560 on your basis surges down E T A s or down. Uh, 0:14:36.600 --> 0:14:39.240 So the business is really hitting on all cylinders and 0:14:39.240 --> 0:14:41.320 it's reflected in the stock press, which is great. I 0:14:41.320 --> 0:14:42.560 do want to ask you a little bit about the 0:14:42.560 --> 0:14:47.160 broader environment, Dara. I still hear people say Uber is expensive, 0:14:47.160 --> 0:14:50.000 and we're seeing Uber benefiting from this. When you look 0:14:50.120 --> 0:14:52.480 at your earnings and the bottom line, how do you 0:14:52.520 --> 0:14:55.080 think about this dynamic longer term? Do you worry at 0:14:55.080 --> 0:14:58.760 all about alienating customers when they're already getting squeezed given 0:14:58.760 --> 0:15:04.040 that this is the worst inflationary environment in Uber's history. Yeah, 0:15:04.040 --> 0:15:06.400 I think inflation is hitting all of us, whether it's 0:15:06.440 --> 0:15:10.720 grocery prices or fuel prices. And remember fuel is a 0:15:10.720 --> 0:15:15.080 big component of our driver costs, so that affects Uber 0:15:15.120 --> 0:15:17.920 prices as well, and you do see it in a result. 0:15:18.120 --> 0:15:23.920 While trips were up, which is really really healthy growth growth, 0:15:23.960 --> 0:15:28.040 bookings were up faster than that, which indicates some inflationary 0:15:28.160 --> 0:15:30.840 effect on our results. I think the good news for 0:15:30.960 --> 0:15:33.640 US is that surge levels are actually coming down E 0:15:33.800 --> 0:15:36.440 T A s are coming down, so as the marketplace 0:15:36.520 --> 0:15:40.160 becomes more balanced, we actually see strength in terms of 0:15:40.240 --> 0:15:43.240 trip growth going forward, and we're hoping if we do 0:15:43.360 --> 0:15:46.200 our jobs and so far, so good onboarding more and 0:15:46.240 --> 0:15:50.120 more drivers, that prices on Uber will ease going forward. 0:15:50.560 --> 0:15:54.360 At the same time, drivers will make really strong earnings 0:15:54.360 --> 0:15:56.960 as well. At the same time, we've heard so many 0:15:57.000 --> 0:15:59.640 dire warnings about the economy. Jamie Diamond has said he's 0:15:59.640 --> 0:16:02.760 prepared for an economic hurricane. I just spoke to Apple 0:16:02.840 --> 0:16:05.200 CEO Tim Cook, who said, you know, he plans to 0:16:05.240 --> 0:16:08.440 be deliberate in Apple spending. You said in the past 0:16:08.440 --> 0:16:11.120 that you think Uber is recession resistant. Do you still 0:16:11.480 --> 0:16:14.960 believe that if we continue to see these down downward 0:16:15.000 --> 0:16:20.720 trends and what is uber strategy to navigate continuing downward trends? Well, 0:16:20.760 --> 0:16:23.960 I think you're certainly seeing in earn results, which is uh. 0:16:24.000 --> 0:16:26.360 There's been a bunch of earnings results out there, and 0:16:26.360 --> 0:16:29.040 and sometimes they've been less than great. I think Uber's 0:16:29.040 --> 0:16:33.680 earnings have been terrific in every way, top line growth, 0:16:33.680 --> 0:16:38.040 profitability growth as well. Um. At the same time, we 0:16:38.120 --> 0:16:42.160 are being disciplined in terms of how we grow going forward. 0:16:42.240 --> 0:16:44.240 This is why our margins are improving so much on 0:16:44.280 --> 0:16:47.280 a year. On your basis free cash flow is now 0:16:47.320 --> 0:16:50.280 positive as well. Because of the scale that we have, 0:16:50.880 --> 0:16:54.800 because we're in multiple businesses, both in mobility and delivery. 0:16:54.920 --> 0:16:57.400 I think we have a kind of business that can 0:16:57.400 --> 0:17:00.640 perform in all weather. But at the same time, we 0:17:00.680 --> 0:17:03.600 are being disciplined in terms of costs to make sure 0:17:03.680 --> 0:17:07.680 that as the environment, if it gets tougher, we are prepared. 0:17:08.200 --> 0:17:10.639 You mentioned on the call that West coast markets are 0:17:10.640 --> 0:17:13.520 taking a little bit longer to come back, and I'm 0:17:13.680 --> 0:17:16.840 I'm thinking about San Francisco and how it's been a 0:17:16.840 --> 0:17:19.320 struggle to get workers back to the office. How are 0:17:19.359 --> 0:17:22.199 you thinking about this and Uber's, for example, Uber's own 0:17:22.240 --> 0:17:25.880 flexible work policies. Do you see the flexibility that you're 0:17:25.920 --> 0:17:29.640 giving workers holding up into next year, for example? Does 0:17:29.800 --> 0:17:32.000 it does feel like the tail of two coasts? You know, 0:17:32.000 --> 0:17:35.399 when we look at the East coast New York, Miami, 0:17:35.520 --> 0:17:42.080 even UH cities, Atlanta, Austin, Dallas. Our business is coming back, 0:17:42.160 --> 0:17:45.320 is roaring back UH at this point, and we feel 0:17:45.320 --> 0:17:49.800 great about that business. Now. The San Francisco market's Los Angeles, Seattle, 0:17:50.160 --> 0:17:52.919 they're certainly coming back. But when you look at the 0:17:52.960 --> 0:17:57.240 absolute levels versus pre pandemic levels, UH, it's a very 0:17:57.480 --> 0:18:01.360 very different story. UM, and you know, we'll keep pushing 0:18:01.520 --> 0:18:03.000 and we will do our part to make sure that 0:18:03.000 --> 0:18:06.520 we've got an ample supply in those markets. Uh. And 0:18:06.600 --> 0:18:11.399 the service works very well. You can check out the 0:18:11.440 --> 0:18:13.600 full interview with uber ceo Dark Cause with Shaw here 0:18:13.600 --> 0:18:24.879 at Bloomberg dot com. Welcome back to Bloomberg Technology. I'm 0:18:24.880 --> 0:18:26.600 Emily checking in San Francisco. I want to get back 0:18:26.600 --> 0:18:29.240 to our top story, and that is US House Speaker 0:18:29.280 --> 0:18:32.480 Nancy Pelosi's visit to Taiwan. We are already seeing a 0:18:32.560 --> 0:18:36.040 major company react. In a Bloomberg scoop c A t L, 0:18:36.160 --> 0:18:39.520 the world's biggest maker of Evy battery cells, has pushed 0:18:39.560 --> 0:18:42.840 back plans to announce a North American plant because of 0:18:42.920 --> 0:18:46.000 this visit to Taiwan. Are at Ludlow help break this 0:18:46.080 --> 0:18:49.080 story at what exactly do we know about this decision? Yes, 0:18:49.119 --> 0:18:53.560 the sources say that CTL was considering sites in Mexico 0:18:53.640 --> 0:18:55.680 and the United States. As we reported a month ago, 0:18:55.760 --> 0:18:58.760 they were close, they were agreeing incentives, they were choosing 0:18:58.800 --> 0:19:03.440 their preferred site. And given the geopolitical tension between the 0:19:03.480 --> 0:19:06.880 United States and China due to Speaker Pelosi's business Taiwan, 0:19:07.080 --> 0:19:10.320 they've decided to push it back to September October. So 0:19:10.359 --> 0:19:12.520 they're not necessarily saying this is not going to happen. 0:19:13.000 --> 0:19:16.359 It's just the announcement has been exactly So there's a 0:19:16.400 --> 0:19:20.120 commitment from CTL, according sources, to do this right. They're 0:19:20.200 --> 0:19:22.440 they're key customers are here. There are a big supplier 0:19:22.440 --> 0:19:25.239 to Tesla for Tesla's China built vehicles. They have an 0:19:25.240 --> 0:19:28.360 agreement to supply Forward in the future. And as we've reported, 0:19:28.400 --> 0:19:30.360 Forward and Tesla were kind of key to those talks. 0:19:30.840 --> 0:19:32.919 But it's too hot right now, and and and you know, 0:19:33.040 --> 0:19:36.399 they are also trying to think about potential incentives in 0:19:36.400 --> 0:19:39.200 the background from the federal government here in the United States. 0:19:39.720 --> 0:19:41.280 They just don't want to get caught up in this 0:19:41.440 --> 0:19:44.919 with what's happening. How strategically important is this company to 0:19:45.520 --> 0:19:49.520 say a Tesla or Afford. Yeah, the reality is CTL 0:19:49.800 --> 0:19:52.080 is a Chinese company. It is the kind of crown 0:19:52.160 --> 0:19:54.679 jewel in China's EV industry. It's the biggest maker, as 0:19:54.760 --> 0:19:57.720 you said, of EV battery cells. But the issue the 0:19:57.720 --> 0:20:01.040 whole industry faces is there is not enough supply. We 0:20:01.119 --> 0:20:05.119 need more battery cells, more players, and having that ct 0:20:05.359 --> 0:20:06.920 L plant, whether it ends up being in the US 0:20:07.040 --> 0:20:09.840 or in Mexico, nearer to where vehicles are actually being 0:20:09.880 --> 0:20:13.119 built by tests or by ford is so important. If 0:20:13.160 --> 0:20:14.840 we've learned one thing in the last two years, it's 0:20:15.080 --> 0:20:18.440 supply chains can on revel really quickly overseas, So on 0:20:18.560 --> 0:20:21.159 shoring this production would really help. Now we have these 0:20:21.200 --> 0:20:24.560 geopolitical issues in the way. Long term though, are you 0:20:24.600 --> 0:20:26.320 seeing this as a company that could have a very 0:20:26.359 --> 0:20:30.440 significant presence on this side of the Pacific Ocean. So 0:20:30.960 --> 0:20:34.240 the commitment that they're making initially is five billion dollars. 0:20:34.280 --> 0:20:36.040 That gets you quite a lot of factory, you know, 0:20:36.119 --> 0:20:38.560 quite a lot of plant. The footprint that we've reported 0:20:38.560 --> 0:20:41.400 on is very big. You know, we're talking about EV 0:20:41.560 --> 0:20:44.880 battery cells at a mass scale and for multiple players. 0:20:45.560 --> 0:20:48.000 Think about the giga factories for example, that the Panasonic 0:20:48.040 --> 0:20:49.960 has a Nevada and others have done deals on the 0:20:50.000 --> 0:20:52.399 West coast, East coast. Sorry, so this is big and 0:20:52.440 --> 0:20:56.720 it's important, all right, I'd love them, thank you well. 0:20:57.040 --> 0:21:00.919 See Bloomberg terminal clients think Elon schiill be forced to 0:21:00.960 --> 0:21:04.240 own Twitter by the end of this saga about and 0:21:04.280 --> 0:21:08.200 more than respondents to include portfolio managers and retail traders 0:21:08.520 --> 0:21:11.600 say Mask won't end up owning Twitter, the deal that 0:21:11.680 --> 0:21:13.960 led Mosque to offload about eight and a half billion 0:21:14.040 --> 0:21:16.880 dollars worth of Tesla shares back in April. One third 0:21:16.920 --> 0:21:19.639 of respondents protect he'll settle with a social media company 0:21:19.640 --> 0:21:22.440 for more than a billion dollars rather than seeing through 0:21:22.600 --> 0:21:25.240 that forty four billion dollar takeover. Joining me now Grace 0:21:25.280 --> 0:21:27.960 Capital founder and chief investment officer Katherine Faddis, who took 0:21:28.040 --> 0:21:31.240 questions about the survey with Luke Ventures Gene Munster. Uh 0:21:31.280 --> 0:21:34.880 this Tuesday morning. So what's your take, Katherine? How does 0:21:34.880 --> 0:21:39.120 this play out in Delaware court? Yeah? I think I'm 0:21:39.119 --> 0:21:43.439 going to agree with the respondents. I think ultimately this 0:21:43.560 --> 0:21:46.560 deal doesn't happen. I'm not It's not clear to me 0:21:47.160 --> 0:21:49.520 why it made sense to begin with. And I understand 0:21:49.840 --> 0:21:53.200 um Elon Musk is very smart. He took testl off 0:21:53.280 --> 0:21:56.800 from loss making deal and he's made it a success. 0:21:56.840 --> 0:21:59.560 He made pay palace success. Maybe there's a theory he 0:21:59.680 --> 0:22:02.920 was going turn around Twitter and you know, pull something 0:22:02.960 --> 0:22:05.920 else out of his hat. But apparently he's lost interest 0:22:06.080 --> 0:22:08.720 and I think it's time to move on Dot Org. 0:22:09.880 --> 0:22:12.359 What does this mean for Twitter and what would it 0:22:12.400 --> 0:22:16.920 mean for Tesla. You know, for Twitter, I think it's 0:22:16.920 --> 0:22:19.920 been quite disruptive and I'm almost wondering if they're going 0:22:20.000 --> 0:22:23.200 to try to get more than the billion dollars. And 0:22:23.359 --> 0:22:26.119 I think if there was the people who believe in 0:22:26.200 --> 0:22:29.159 Elon Must thought wow, he's going to get involved in 0:22:29.240 --> 0:22:31.760 Twitter and he's going to turn it into a gold mine. 0:22:32.280 --> 0:22:35.480 So I think for Twitter it's it's not good either way. 0:22:35.560 --> 0:22:38.480 I think it's been disruptive. I think if there was hope, 0:22:38.720 --> 0:22:40.840 you know, Twitter shareholders were going to get a lot 0:22:40.840 --> 0:22:44.040 of money. Now they're not. It's just not good. And 0:22:44.040 --> 0:22:48.680 I think Twitter's business model is struggling anyway. And for Tesla, 0:22:49.320 --> 0:22:51.359 I think it might be good news because I think 0:22:51.400 --> 0:22:53.800 that it was a distraction. It was a distraction for 0:22:53.920 --> 0:22:58.200 Tesla shareholders. They want Elon must focusing on Tesla, solving 0:22:58.240 --> 0:23:02.359 the problems, bringing you know, the wonderful things he's done operationally, 0:23:02.440 --> 0:23:06.680 supply chain efficiency, all the great things that make Tesla 0:23:06.800 --> 0:23:09.600 what it is. So I think it's good news for Tesla. 0:23:10.080 --> 0:23:14.720 Tesla has a huge footprint in China, and I'm curious 0:23:14.880 --> 0:23:18.960 how you think this big visit Nancy Pelosi going to 0:23:19.040 --> 0:23:22.560 Taiwan against the wishes of the Chinese government. If there's 0:23:22.600 --> 0:23:26.600 an impact for Tesla here, clearly there will be an 0:23:26.640 --> 0:23:30.080